[Federal Register Volume 63, Number 243 (Friday, December 18, 1998)]
[Proposed Rules]
[Pages 70063-70065]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-33573]


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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. 243 / Friday, December 18, 1998 / 
Proposed Rules  

[[Page 70063]]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 993

[Docket No. FV99-993-1 PR]


Dried Prunes Produced in California; Increased Assessment Rate

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule.

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SUMMARY: This rule would increase the current assessment rate from 
$2.16 to $3.28 per ton of salable dried prunes for the Prune Marketing 
Committee (Committee) under Marketing Order No. 993 for the 1998-99 and 
subsequent crop years. The Committee is responsible for local 
administration of the marketing order which regulates the handling of 
dried prunes grown in California. Authorization to assess dried prune 
handlers enables the Committee to incur expenses that are reasonable 
and necessary to administer the program. The increased assessment rate 
is needed because the assessable tonnage is expected to be 99,750 
salable tons, or 38 percent less than the Committee's initial estimate 
for 1998-99. Increasing the assessment rate to $3.28 per ton of salable 
dried prunes would allow the Committee to meet its 1998-99 expenses and 
to operate for the first three months of the 1999-2000 crop year before 
monies become available from that year's assessments. The higher 
assessment rate would apply for the entire 1998-99 crop year, which 
began August 1 and ends July 31. The assessment rate would remain in 
effect indefinitely unless modified, suspended, or terminated.

DATES: Comments must be received by December 28, 1998.

ADDRESSES: Interested persons are invited to submit written comments 
concerning this rule. Comments must be sent to the Docket Clerk, Fruit 
and Vegetable Programs, AMS, USDA, room 2525-S, P.O. Box 96456, 
Washington, DC 20090-6456; Fax: (202) 205-6632; or E-mail: 
[email protected]. 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 
Richard P. Van Diest, Marketing Specialist, California Marketing Field 
Office, Fruit and Vegetable Programs, AMS, USDA, 2202 Monterey Street, 
suite 102B, Fresno, California 93721; telephone (559) 487-5901; Fax 
(559) 487-5906; or George Kelhart, Technical Advisor, 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. Small businesses may request information 
on compliance with this regulation, or obtain a guide on complying with 
fruit, vegetable, and specialty crop marketing agreements and orders 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, or E-mail: Jay__N__G[email protected]. You may view the marketing 
agreement and order small business compliance guide at the following 
web site: http://www.ams.usda.gov/fv/moab.html.

SUPPLEMENTARY INFORMATION: This rule is issued under Marketing 
Agreement and Order No. 993, both as amended (7 CFR part 993), 
regulating the handling of dried prunes 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 
dried prune 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 
dried prunes beginning on August 1, 1998, and continue 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 1998-99 and subsequent crop years from $2.16 per ton 
to $3.28 per ton of salable dried prunes.
    The California dried prune 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 dried prunes. 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 1998-99 and subsequent crop years, the Committee 
recommended, and the Department approved, an assessment rate that would 
continue in effect from crop year to crop year unless modified, 
suspended, or terminated by

[[Page 70064]]

the Secretary upon recommendation and information submitted by the 
Committee or other information available to the Secretary.
    The Committee met on December 1, 1998, and unanimously recommended 
to reduce its 1998-99 budget from $348,840 to $327,180 and increase the 
current assessment rate from $2.16 to $3.28 per ton of salable dried 
prunes. The assessment rate of $2.16 per ton was approved by the 
Department in a final rule published in the Federal Register on October 
2, 1998 (63 FR 52959). The $1.22 per ton increase in the assessment 
rate to $3.28 per ton is needed to allow the Committee to meet its 
1998-99 expenses and to operate for the first three months of the 1999-
2000 crop year before monies become available from next year's 
assessments. The California Agricultural Statistical Service originally 
estimated a 170,000 ton crop (161,500 salable tons) for the 1998-99 
crop year. Due to unusually cool and wet weather conditions caused by 
the El Nino this season, the 1998-99 crop harvest is about four weeks 
late, of poor quality, and approximately 50 percent less than normal 
size. The Committee now expects the salable prune tonnage to be 99,750 
salable tons, or 38 percent less than the Committee's initial estimate 
for 1998-99.
    The following table compares major budget expenditures recommended 
by the Committee on June 25, 1998, and major budget expenditures in the 
revised budget recommended on December 1, 1998.

------------------------------------------------------------------------
                                                         ($1,000)
            Budget expense categories            -----------------------
                                                    6/25/98     12/1/98
------------------------------------------------------------------------
Salaries, Wages & Benefits......................      191.5       189.7
Research & Development..........................       30           0
Office Rent.....................................       23          23
Travel..........................................       21          18.5
Acreage Survey..................................       21           0
Reserve (Contingencies).........................        9.14       50.93
Equipment Rental................................        9           9
Data Processing.................................        8           3.85
Stationary & Printing...........................        5.5         5
Office Supplies.................................        5           5
Postage & Messenger.............................        5           5
------------------------------------------------------------------------

    The assessment rate recommended by the Committee was derived by 
dividing the reduced expenses by its reduced estimate of salable 
California dried prunes. Production of dried prunes for the year is 
estimated at 99,750 salable tons which should provide $327,180 in 
assessment income. Interest income also will be available to cover 
anticipated expenses. The Committee is authorized to use excess 
assessment funds from the 1997-98 crop year (currently estimated at 
$58,088) for up to five months beyond the end of the crop year to meet 
1998-99 crop year expenses. At the end of the five months, the 
Committee refunds or credits excess funds to handlers (Sec. 993.81(c)). 
Income derived from handler assessments, along with interest income, 
would be adequate to cover budgeted expenses.
    The proposed assessment rate 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 would be in effect for an indefinite 
period, the Committee would continue to meet prior to or during each 
crop 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. 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 
1998-99 budget and those for subsequent crop 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 1,250 producers of dried prunes in the 
production area and approximately 20 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.
    An updated prune industry profile shows that 8 of the 20 handlers 
(40 percent) shipped over $5,000,000 of dried prunes and could be 
considered large handlers by the Small Business Administration. Twelve 
of the 20 handlers (60 percent) shipped under $5,000,000 of dried 
prunes and could be considered small handlers. An estimated 90 
producers, or about 7 percent of the 1,250 total producers, would be 
considered large growers with annual income over $500,000. The majority 
of handlers and producers of California dried prunes may be classified 
as small entities.
    This rule would increase the current assessment rate established 
for the Committee and collected from handlers for the 1998-99 and 
subsequent crop years from $2.16 per ton to $3.28 per ton of salable 
dried prunes. The Committee unanimously recommended 1998-99 
expenditures of $327,180 and an assessment rate of $3.28 per ton of 
salable dried prunes. The proposed assessment rate of $3.28 is $1.22 
higher than the current 1998-99 rate (63 FR 52959, October 2, 1998). 
The quantity of assessable dried prunes for the 1998-99 crop year is 
now estimated at 99,750 salable tons. Thus, the $3.28 rate should 
provide $327,180 in assessment income and be adequate to meet this 
year's expenses. Interest income also would be available to cover 
budgeted expenses if the 1998-99 expected assessment income falls 
short.
    The following table compares major budget expenditures recommended 
by the Committee on June 25, 1998, with major budget expenditures in 
the revised budget recommended on December 1, 1998.

------------------------------------------------------------------------
                                                         ($1,000)
            Budget expense categories            -----------------------
                                                    6/25/98     12/1/98
------------------------------------------------------------------------
Salaries, Wages & Benefits......................      191.5       189.7
Research & Development..........................       30           0
Office Rent.....................................       23          23
Travel..........................................       21          18.5
Acreage Survey..................................       21           0
Reserve (Contingencies).........................        9.14       50.93
Equipment Rental................................        9           9
Data Processing.................................        8           3.85
Stationary & Printing...........................        5.5         5
Office Supplies.................................        5           5
Postage & Messenger.............................        5           5
------------------------------------------------------------------------


[[Page 70065]]

    Due to unusually cool and wet weather conditions caused by the El 
Nino this season, the 1998-99 crop harvest is about four weeks late, of 
poor quality, and approximately 50 percent less than normal size. At 
its December 1, 1998, meeting, the Committee reduced the California 
Agricultural Statistical Service's dried prune crop estimate for 1998-
99 from 170,000 tons (161,500 salable tons) to 103,000 tons (99,750 
salable tons).
    The Committee reviewed and unanimously recommended 1998-99 
expenditures of $327,180. The assessment rate of $3.28 per ton of 
salable dried prunes was then determined by dividing the total 
recommended budget by the reduced estimate for salable dried prunes. 
The Committee is authorized to use excess assessment funds from the 
1997-98 crop year (currently estimated at $58,088) for up to five 
months beyond the end of the crop year to fund 1998-99 crop year 
expenses. At the end of the five months, the Committee refunds or 
credits excess funds to handlers (Sec. 993.81(c)). Anticipated 
assessment income and interest income during 1998-99 would be adequate 
to cover authorized expenses.
    Recent price information indicates that the grower price for the 
1998-99 season should average about $800 per salable ton of dried 
prunes. Based on estimated shipments of 99,750 salable tons, assessment 
revenue during the 1998-99 crop year is expected to be less than 1 
percent of the total expected grower revenue.
    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 
would 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 dried prune 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 1, 1998, 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 either small or large California dried 
prune handlers. 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 10-day comment period is provided to allow interested persons to 
respond to this proposed rule. Ten days is deemed appropriate because: 
(1) The 1998-99 crop year began on August 1, 1998, and the marketing 
order requires that the rate of assessment for each crop year apply to 
all assessable dried prunes handled during such crop year; (2) the 
Committee needs to have sufficient funds to pay its expenses which are 
incurred on a continuous basis; (3) 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; 
and (4) the Committee's excess funds are nearly exhausted and the 
assessment increase must be implemented promptly so the Committee can 
collect assessments based on the higher rate and meet its financial 
obligations.

List of Subjects in 7 CFR Part 993

    Marketing agreements, Plums, Prunes, Reporting and recordkeeping 
requirements.

    For the reasons set forth in the preamble, 7 CFR part 993 is 
proposed to be amended as follows:

PART 993--DRIED PRUNES PRODUCED IN CALIFORNIA

    1. The authority citation for 7 CFR part 993 continues to read as 
follows:

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

    2. Section 993.347 is proposed to be revised to read as follows:


Sec. 993.347  Assessment rate.

    On and after August 1, 1998, an assessment rate of $3.28 per ton is 
established for California dried prunes.

    Dated: December 14, 1998.
Robert C. Keeney,
Deputy Administrator, Fruit and Vegetable Programs.
[FR Doc. 98-33573 Filed 12-17-98; 8:45 am]
BILLING CODE 3410-02-P