[Federal Register Volume 64, Number 82 (Thursday, April 29, 1999)]
[Rules and Regulations]
[Pages 23009-23011]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-10773]



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  Federal Register / Vol. 64, No. 82 / Thursday, April 29, 1999 / Rules 
and Regulations  

[[Page 23009]]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 932

[Docket No. FV99-932-2 FIR]


Olives Grown in California; Modification to Handler Membership on 
the California Olive Committee

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule

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SUMMARY: The Department of Agriculture (Department) is adopting, as a 
final rule, without change, the provisions of an interim final rule 
modifying the handler membership on the California Olive Committee 
(committee). The committee locally administers the California olive 
marketing order (order) which regulates the handling of olives grown in 
California. The committee is composed of 16 industry members of which 8 
are producers and 8 are handlers. Previously, handler membership was 
allocated between cooperative marketing organizations and independent 
handlers (handlers not affiliated with cooperatives), and the number of 
handler members who may have been affiliated with any one handler was 
limited to two. This rule continues in effect the removal of the 
distinction between cooperative and independent handlers, continues in 
effect the removal of the limitation on handler affiliation, and 
continues in effect the reallocation of handler membership on the basis 
of the total quantity of olives handled. These modifications will allow 
two vacant handler member positions on the committee to be filled. This 
rule was unanimously recommended by the committee.

EFFECTIVE DATE: June 1, 1999.

FOR FURTHER INFORMATION CONTACT: Terry Vawter, Marketing Specialist, 
California Marketing Field Office, Marketing Order Administration 
Branch, F&V, 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, F&V, AMS, USDA, room 2525-S, PO Box 96456, Washington, DC 
20090-6456; telephone: (202) 720-2491; Fax: (202) 720-5698. Small 
businesses may request information on complying 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, PO Box 96456, room 2525-S, Washington, DC 20090-6456; 
telephone: (202) 720-2491; Fax: (202) 720-5698, or E-mail: 
Jay.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 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 is issuing this rule in conformance with Executive 
Order 12866.
    This final rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. This rule is not intended to have retroactive 
effect. 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. A 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.
    Section 932.25 of the order provides for the establishment of the 
committee to locally administer the terms and provisions of the order. 
The committee is composed of 16 industry members, each with an 
alternate. Of the 16 industry members, 8 are producers and 8 are 
handlers. This section also specifies how the handler membership on the 
committee is allocated. Authority is provided for the committee, with 
the approval of the Secretary, to change the allocation of both 
producer and handler members as may be necessary to assure equitable 
representation.
    Section 932.159 of the administrative rules and regulations 
provides that two members shall represent cooperative marketing 
organizations and six members shall represent handlers who are not 
cooperative marketing organizations. In addition, Sec. 932.160 limits 
to two the number of handler members that may be affiliated with the 
same handler.
    The committee met on December 10, 1998, and unanimously recommended 
modifying the rules and regulations to remove the distinction between 
cooperative and independent handlers, and increase the limitation on 
the number of handler members that may be affiliated with the same 
handler. It also unanimously recommended that the two handlers who 
handled the largest and second largest total volume of olives during 
the crop year in which nominations are made and the preceding crop year 
be represented by three members each, and that the third largest 
handler be represented by two members. This rule continues in effect 
the modification of the committee's handler membership to reflect 
changes within the handler segment of the industry, and to enable the 
committee to operate at full strength; i.e., with all eight handler and 
producer positions filled.

[[Page 23010]]

    The structure of the olive industry has changed over the years and 
the number of handlers, both cooperative and independent, has 
decreased. At one time, there were a number of cooperative marketing 
organizations and independent handlers and the committee's structure 
was designed so that four of the eight handler seats were held by 
cooperatives and four were held by independents. This representation 
was also weighted by the volume of olives handled so that if one group, 
either cooperatives or independents, handled 65 percent or more of the 
total industry's volume handled during the nominating crop year and the 
preceding crop year, that group would have five seats on the committee 
and the other group would have three seats.
    In 1993, handler membership on the committee was reallocated to 
reflect changes within the industry. The number of industry handlers 
declined to only five handlers--one cooperative and four independents. 
At that time, Sec. 932.159 of the order's rules and regulations was 
modified to reapportion handler membership to provide cooperative 
handlers with two seats on the committee and independent handlers with 
six seats.
    Since 1993, the number of handlers in the olive industry has 
continued to decline. Today there are three handlers remaining--one 
cooperative and two independents. Because there is only one existing 
cooperative, the committee believes that the distinction regarding 
cooperative and independent handlers on the committee is no longer 
appropriate or necessary.
    Additionally, prior to the issuance of the interim final rule, 
Sec. 932.160 specified that no more than two nominees for member and 
alternate member positions may be affiliated with the same handler. 
Because there are only three handlers remaining in the industry, this 
restriction resulted in two vacant handler positions on the committee 
that could not be filled.
    To allow these positions to be filled and enable the committee to 
operate at full strength, the committee recommended that Sec. 932.159 
be revised to eliminate the distinction between cooperative marketing 
organizations and independent handlers (or handlers not affiliated with 
a cooperative marketing organization). It also recommended that the 
eight handler seats on the committee be reallocated based on the total 
volume of olives handled during the crop year in which nominations are 
made and the preceding crop year, with the handlers handling the first 
and second largest volume being represented with three members each, 
and the remaining handler being represented with two members.
    The reallocation of handler membership in Sec. 932.159 makes the 
two-nominee limitation on affiliation with the same handler specified 
in Sec. 932.160 unnecessary, and that section is continued to be 
removed.
    These changes are designed to modify the committee's handler 
membership to reflect structural changes within the handler segment of 
the industry, and to remove the former barriers to filling the two 
vacant handler positions on the committee.
    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA), the Agricultural Marketing Service (AMS) has considered the 
economic impact of this action on small entities. Accordingly, AMS has 
prepared this final 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 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 3 handlers of California olives who are subject to 
regulation under the marketing order and approximately 1,200 olive 
producers in the regulated area. Small agricultural service firms have 
been defined by the Small Business Administration (13 CFR 121.601) as 
those having annual receipts of less than $5,000,000, and small 
agricultural producers are defined as those having annual receipts of 
less than $500,000. None of the olive handlers may be classified as 
small entities.
    Based on a review of historical and preliminary price and marketing 
information, total grower revenue for the 1998-99 crop year (August 1 
through July 31) is estimated to be approximately $39,500,000, and the 
average grower revenue will be approximately $33,000. Thus, it can be 
concluded that the majority of producers of California olives may be 
classified as small entities.
    This rule continues in effect the modification of the order's 
administrative rules and regulations regarding the structure of handler 
membership on the committee. The committee locally administers the 
order and is composed of 16 industry members. Eight of the 16 industry 
members are producers and 8 are handlers. Previously, handler 
membership provisions distinguished between cooperative marketing 
organizations and independent handlers specifying that two members 
shall represent cooperative marketing organizations and six members 
shall represent handlers who are not cooperative marketing 
organizations. The handler nominee provisions also specified that no 
more than two nominees for handler member and alternate member 
positions may be affiliated with the same handler.
    This rule also continues in effect the modification of the order's 
rules and regulations to remove the distinction between cooperative and 
independent handlers, and to specify that the number of members 
representing each of the three currently existing industry handlers 
shall be based on the total volume of olives handled during the 
nominating crop year and the preceding crop year, with the two handlers 
handling the largest and second largest volume of olives represented by 
three members and alternates each, and the remaining handler 
represented by two members and alternates. In addition, this rule 
continues in effect the removal of provisions limiting the number of 
members to which each handler is entitled because the limitation is no 
longer necessary. The changes were unanimously recommended by the 
committee and are intended to modify the committee's handler membership 
to reflect structural changes within the handler segment of the 
industry, and to remove former barriers to filling two vacant handler 
positions on the committee. Authority for this rule is provided in 
Sec. 932.25 which allows the committee, with the approval of the 
Secretary, to reallocate the committee's producer or handler membership 
as necessary to assure equitable representation.
    Continuing in effect the removal of the distinction between 
cooperative and independent handlers will not have any impact on 
handlers or producers in the California olive industry.
    One alternative to this rule discussed at the meeting was to leave 
the language in Sec. 932.159 unchanged; however, the committee believed 
that the distinction between cooperative and independent was no longer 
appropriate, because there is only one existing cooperative in the 
industry and two independent handlers. Another alternative discussed at 
the meeting was to leave Sec. 932.160 of the order's rules and 
regulations unchanged so that only two members may be affiliated with 
the same handler, but with only three handlers currently in the 
industry that would have resulted in uneven representation between 
growers with eight members and

[[Page 23011]]

handlers with six members, and would have failed to assure equitable 
representation on the committee as is required pursuant to Sec. 932.25.
    This rule will not impose any additional reporting or recordkeeping 
requirements on any of the three olive 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. In addition, as noted in the initial regulatory 
flexibility analysis, the Department has not identified any relevant 
Federal rules that duplicate, overlap, or conflict with this rule.
    Further, the committee's meeting was widely publicized throughout 
the 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 10, 1998, meeting was a 
public meeting and all entities, both large and small, were able to 
express their views on this issue. All three industry handlers are 
currently represented on the committee and participated in the 
deliberations.
    An interim final rule concerning this action was published in the 
Federal Register on January 28, 1999. The committee staff advised each 
handler of such publication by personal contact. In addition, the rule 
was made available through the Internet by the Office of the Federal 
Register. That rule provided a 60-day comment period, which ended March 
29, 1999. No comments were received.
    After consideration of all relevant material presented, including 
the committee's recommendation, and other information, it is found that 
finalizing the interim final rule, without change, as published in the 
Federal Register (64 FR 4286), will tend to effectuate the declared 
policy of the Act.

List of Subjects in 7 CFR Part 932

    Marketing agreements, Olives, Reporting and recordkeeping 
requirements.

PART 932--OLIVES GROWN IN CALIFORNIA

    Accordingly, the interim final rule amending 7 CFR part 932 which 
was published at 64 FR 4286 on January 28, 1999, is adopted as a final 
rule without change.

    Dated: April 21, 1999.
Robert C. Keeney,
Deputy Administrator, Fruit and Vegetable Programs.
[FR Doc. 99-10773 Filed 4-28-99; 8:45 am]
BILLING CODE 3410-02-P