[Federal Register Volume 63, Number 31 (Tuesday, February 17, 1998)]
[Proposed Rules]
[Pages 7732-7734]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-3869]


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 Proposed Rules
                                                 Federal Register
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 This section of the FEDERAL REGISTER contains notices to the public of 
 the proposed issuance of rules and regulations. The purpose of these 
 notices is to give interested persons an opportunity to participate in 
 the rule making prior to the adoption of the final rules.
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  Federal Register / Vol. 63, No. 31 / Tuesday, February 17, 1998 / 
Proposed Rules  

[[Page 7732]]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 932

[Docket No. FV98-932-1 PR]


Olives Grown in California; Increased Assessment Rate

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule.

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SUMMARY: This rule would increase the assessment rate established for 
the California Olive Committee (Committee) under Marketing Order No. 
932 for the 1998 and subsequent fiscal years. The Committee is 
responsible for local administration of the marketing order which 
regulates the handling of olives grown in California. Authority to 
assess olive handlers enables the Committee to incur expenses that are 
reasonable and necessary to administer the program. The fiscal year 
began January 1 and ends December 31. The assessment rate would remain 
in effect indefinitely unless modified, suspended, or terminated.

DATES: Comments must be received by March 19, 1998.

ADDRESSES: Interested persons are invited to submit written comments 
concerning this rule. Comments must be sent in triplicate to the Docket 
Clerk, Fruit and Vegetable Programs, AMS, USDA, room 2525-S, PO Box 
96456, Washington, DC 20090-6456; Fax: (202) 205-6632. Comments should 
reference the docket number and the date and page number of this issue 
of the Federal Register and will be available for public inspection in 
the Office of the Docket Clerk during regular business hours.

FOR FURTHER INFORMATION CONTACT: Diane Purvis, Marketing Assistant, or 
Terry Vawter, Marketing Specialist, California Marketing Field Office, 
Fruit and Vegetable Programs, AMS, USDA, 2202 Monterey Street, Suite 
102B, Fresno, California 93721; telephone: (209) 487-5901, Fax: (209) 
487-5906; or George Kelhart, Technical Advisor, Marketing Order 
Administration Branch, Fruit and Vegetable Programs, AMS, USDA, room 
2525-S, PO Box 96456, Washington, DC 20090-6456; telephone: (202) 720-
2491, Fax: (202) 205-6632. Small businesses may request information on 
compliance with this regulation by contacting Jay Guerber, Marketing 
Order Administration Branch, Fruit and Vegetable Programs, AMS, USDA, 
room 2525-S, P.O. Box 96456, Washington, DC 20090-6456; telephone: 
(202) 720-2491, Fax: (202) 205-6632.

SUPPLEMENTARY INFORMATION: This rule is issued under Marketing 
Agreement No. 148 and Order No. 932, both as amended (7 CFR part 932), 
regulating the handling of olives grown in California, hereinafter 
referred to as the ``order.'' The marketing agreement and order are 
effective under the Agricultural Marketing Agreement Act of 1937, as 
amended (7 U.S.C. 601-674), hereinafter referred to as the ``Act.''
    The Department of Agriculture (Department) is issuing this rule in 
conformance with Executive Order 12866.
    This rule has been reviewed under Executive Order 12988, Civil 
Justice Reform. Under the marketing order now in effect, California 
olive handlers are subject to assessments. Funds to administer the 
order are derived from such assessments. It is intended that the 
assessment rate as issued herein will be applicable to all assessable 
olives beginning January 1, 1998, and continuing until amended, 
suspended, or terminated. This rule will not preempt any State or local 
laws, regulations, or policies, unless they present an irreconcilable 
conflict with this rule.
    The Act provides that administrative proceedings must be exhausted 
before parties may file suit in court. Under section 608c(15)(A) of the 
Act, any handler subject to an order may file with the Secretary a 
petition stating that the order, any provision of the order, or any 
obligation imposed in connection with the order is not in accordance 
with law and request a modification of the order or to be exempted 
therefrom. Such handler is afforded the opportunity for a hearing on 
the petition. After the hearing the Secretary would rule on the 
petition. The Act provides that the district court of the United States 
in any district in which the handler is an inhabitant, or has his or 
her principal place of business, has jurisdiction to review the 
Secretary's ruling on the petition, provided an action is filed not 
later than 20 days after the date of the entry of the ruling.
    This rule would increase the assessment rate established for the 
Committee for the 1998 fiscal year and subsequent fiscal years from 
$14.99 per ton to $17.10 per ton.
    The California olive marketing order provides authority for the 
Committee, with the approval of the Department, to formulate an annual 
budget of expenses and collect assessments from handlers to administer 
the program. The members of the Committee are producers and handlers of 
California olives. They are familiar with the Committee's needs and 
with the costs for goods and services in their local area and are thus 
in a position to formulate an appropriate budget and assessment rate. 
The assessment rate is formulated and discussed in a public meeting. 
Thus, all directly affected persons have an opportunity to participate 
and provide input.
    For the 1997 fiscal year and subsequent fiscal years, the Committee 
recommended, and the Department approved, an assessment rate that would 
continue in effect from fiscal year to fiscal year unless modified, 
suspended, or terminated by the Secretary upon recommendation and 
information submitted by the Committee or other information available 
to the Secretary.
    The Committee met on December 11, 1997, and unanimously recommended 
1998 fiscal year expenditures of $1,750,400 and an assessment rate of 
$17.10 per ton of olives received during the 1997-98 crop year, which 
began August 1, 1997, and ends July 31, 1998. In comparison, last 
year's budgeted expenditures were $2,159,265. The assessment rate of 
$17.10 is $2.11 higher than the rate currently in effect.
    Olive trees have an alternate-bearing characteristic causing a 
large crop one year and a small crop the next. Handler receipts of 
olives for the 1997-98 crop year were 85,585 tons, which is 59% less 
than the 144,075 tons received in 1996-97. Although the 1998 fiscal 
year budgeted expenditures are less than those in the prior year, the 
decrease in olive receipts necessitates an increase in the assessment 
rate to cover all

[[Page 7733]]

anticipated expenditures. If the assessment rate is not increased from 
the 1997 fiscal year assessment rate of $14.99, funds will fall 
approximately $467,481 short of 1998 fiscal year's budgeted expenses.
    The major expenditures recommended by the Committee for the 1998 
year include $357,900 for administration, $50,000 for research, and 
$1,308,500 for market development. Budgeted expenses for these items in 
1997 were $390,890, $173,375, and $1,595,000, respectively.
    The assessment rate recommended by the Committee was derived by 
considering anticipated expenses, actual receipts of olives, and 
additional pertinent factors. The revised assessment rate should 
provide $1,463,504 in assessment income. Income derived from handler 
assessments, interest, and carryover of reserve funds would be adequate 
to cover budgeted expenses. Funds in the reserve (currently $287,996) 
would be kept within the maximum permitted by the order (approximately 
one fiscal year's expenses; Sec. 932.40).
    The assessment rate established in this rule would continue in 
effect indefinitely unless modified, suspended, or terminated by the 
Secretary upon recommendation and information submitted by the 
Committee or other available information.
    Although this assessment rate is effective for an indefinite 
period, the Committee would continue to meet prior to or during each 
fiscal year to recommend a budget of expenses and consider 
recommendations for modification of the assessment rate. The dates and 
times of Committee meetings are available from the Committee or the 
Department and are published in local newspapers. Committee meetings 
are open to the public and interested persons may express their views 
at these meetings. The Department would evaluate Committee 
recommendations and other available information to determine whether 
modification of the assessment rate is needed. Further rulemaking would 
be undertaken as necessary. The Committee's 1998 fiscal year budget and 
those for subsequent fiscal years would be reviewed and, as 
appropriate, approved by the Department.
    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA), the Agricultural Marketing Service (AMS) has considered the 
economic impact of this rule on small entities. Accordingly, AMS has 
prepared this initial regulatory flexibility analysis.
    The purpose of the RFA is to fit regulatory actions to the scale of 
business subject to such actions in order that small businesses will 
not be unduly or disproportionately burdened. Marketing orders issued 
pursuant to the Act, and the rules issued thereunder, are unique in 
that they are brought about through group action of essentially small 
entities acting on their own behalf. Thus, both statutes have small 
entity orientation and compatibility.
    There are approximately 1,200 producers of olives in the production 
area and 4 handlers subject to regulation under the marketing order. 
Small agricultural producers have been defined by the Small Business 
Administration (13 CFR 121.601) as those having annual receipts less 
than $500,000, and small agricultural service firms are defined as 
those whose annual receipts are less than $5,000,000. None of the olive 
handlers may be classified as small entities, while the majority of 
olive producers may be classified as small entities.
    This rule would increase the assessment rate established for the 
Committee and collected from handlers for the 1998 fiscal year and 
subsequent fiscal years from $14.99 per ton to $17.10 per ton. The 
Committee unanimously recommended 1998 fiscal year expenditures of 
$1,750,400 and an assessment rate of $17.10 per ton. The increased 
assessment rate is needed because the quantity of assessable olives for 
the 1998 fiscal year is 85,585 tons, a decrease of 59% from last year's 
crop of 144,075 tons. The $17.10 rate should provide $1,463,504 in 
assessment income and be adequate to meet this year's budgeted 
expenses, when combined with funds from the authorized reserve and 
interest income.
    A review of historical and preliminary information pertaining to 
the upcoming fiscal year indicates that the grower prices for the 1997-
98 crop year could range from $150 to $825 per ton of olives for 
canning sizes. Therefore, the estimated assessment revenue for the 1998 
fiscal year as a percentage of total grower revenue could range between 
11.4 and 2 percent, respectively. Because most of the canning sizes 
will probably be sold closer to the $825 per ton price, the estimated 
assessment revenue for the 1998 fiscal year as a percentage of total 
grower revenue will be closer to 2 percent.
    This action would increase the assessment obligation imposed on 
handlers. While assessments impose some additional costs on handlers, 
the costs are minimal and uniform on all handlers. Some of the 
additional costs may be passed on to producers. However, these costs 
are expected to be offset by the benefits derived by the operation of 
the marketing order. In addition, the Committee's meeting was widely 
publicized throughout the California olive industry and all interested 
persons were invited to attend the meeting and participate in Committee 
deliberations on all issues. Like all Committee meetings, the December 
11, 1997, meeting was a public meeting and all entities, both large and 
small, were able to express views on this issue. Finally, interested 
persons are invited to submit information on the regulatory and 
informational impacts of this action on small businesses.
    This proposed rule would impose no additional reporting or 
recordkeeping requirements on California olive handlers, none of which 
are small entities. As with all Federal marketing order programs, 
reports and forms are periodically reviewed to reduce information 
requirements and duplication by industry and public sector agencies.
    The Department has not identified any relevant Federal rules that 
duplicate, overlap, or conflict with this rule.
    A 30-day comment period is provided to allow interested persons to 
respond to this proposed rule. Thirty days is deemed appropriate 
because: (1) The Committee needs to have sufficient funds to pay its 
expenses which are incurred on a continuous basis; (2) the 1998 fiscal 
year began on January 1, 1998, and the marketing order requires that 
the rate of assessment for each fiscal year apply to all assessable 
olives handled during such fiscal year; (3) all four handlers are 
represented on the Committee and participated in deliberations; and (4) 
handlers are aware of this action which was unanimously recommended by 
the Committee at a public meeting and is similar to other assessment 
rate actions issued in past years.

List of Subjects in 7 CFR Part 932

    Marketing agreements, Olives, Reporting and recordkeeping 
requirements.

    For the reasons set forth in the preamble, 7 CFR part 932 is 
proposed to be amended as follows:

PART 932--OLIVES GROWN IN CALIFORNIA

    1. The authority citation for 7 CFR part 932 continues to read as 
follows:

    Authority: 7 U.S.C. 601-674.

    2. Section 932.230 is proposed to be revised to read as follows:

[[Page 7734]]

Sec. 932.230  Assessment rate.

    On and after January 1, 1998, an assessment rate of $17.10 per ton 
is established for assessable olives grown in California.

    Dated: February 9, 1998.
Robert C. Keeney,
Deputy Administrator, Fruit and Vegetable Programs.
[FR Doc. 98-3869 Filed 2-13-98; 8:45 am]
BILLING CODE 3410-02-P