[Federal Register Volume 64, Number 124 (Tuesday, June 29, 1999)]
[Rules and Regulations]
[Pages 34705-34707]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-16508]



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  Federal Register / Vol. 64, No. 124 / Tuesday, June 29, 1999 / Rules 
and Regulations  

[[Page 34705]]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 929

[Docket No. FV99-929-1 FIR]


Cranberries Grown in the States of Massachusetts, et al.; 
Temporary Suspension of a Provision on Producer Continuance Referenda 
Under the Cranberry Marketing Order

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 
which temporarily suspended an order provision requiring a producer 
continuance referendum to be conducted on the marketing order during 
the month of May 1999. The industry currently is experiencing unsettled 
marketing conditions due to a surplus of product. The temporary delay 
in holding the continuance referendum is allowing the Cranberry 
Marketing Committee (Committee) to finalize the development of a plan 
to improve the marketing situation, hold producer meetings throughout 
the production area to update them on the situation, and begin 
implementing the plan.

EFFECTIVE DATE: July 29, 1999.

FOR FURTHER INFORMATION CONTACT: Patricia A. Petrella or Kenneth G. 
Johnson, Marketing Order Administration Branch, F&V, AMS, USDA, room 
2530-S, P.O. Box 96456, Washington, DC 20090-6456, telephone: (202) 
720-2491; Fax: (202) 720-5698 or Anne M. Dec, 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) 720-5698. 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, P.O. 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 also view the marketing 
agreements and orders small business compliance guide at the following 
website: http://www.ams.usda.gov/fv/moab.html.

SUPPLEMENTARY INFORMATION: This rule is issued under Marketing Order 
No. 929, as amended (7 CFR part 929), regulating the handling of 
cranberries grown in 10 States. The order is 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 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.
    The action temporarily suspended a provision in Sec. 929.69(d) of 
the order which specifies the month and year when a continuance 
referendum should be conducted to determine if producers favor 
continuance of the cranberry marketing order. This action was 
unanimously recommended by the Committee at its March 15, 1999, 
meeting.
    Section 929.69(d) of the order provides that the Secretary shall 
conduct a referendum during the month of May 1975 to ascertain whether 
continuance of the order is favored by the producers, and that the 
Secretary shall conduct such a referendum during the month of May of 
every fourth year thereafter. The next continuance referendum was 
scheduled to be conducted in May 1999. The last continuance referendum 
was held in May 1995.
    Section 929.69(b) of the order authorizes the Secretary to 
terminate or suspend the operation of any or all of the provisions of 
this part whenever the Secretary finds that such provisions do not tend 
to effectuate the declared policy of the Act.
    At its March 15, 1999, meeting, the Committee recommended delaying 
the May 1999 referendum because the cranberry industry currently is 
experiencing significant marketing problems. Over the last few months, 
inventories of cranberry juice have been at record levels and producer 
prices have dropped significantly.
    The Committee reported that, over the last five years, the industry 
has enjoyed increasing demand for cranberry products, primarily due to 
the success of numerous cranberry juice based beverages. However, such 
success has attracted additional production. With increased production 
and a leveling of demand, carry-out stocks of cranberry juice and juice 
products are at record levels and are predicted to increase 
significantly over the next few years. The Committee reported that 
carryout stocks at the end of August were approximately 1.2 million 
(mill.) barrels (bbls) in 1997, 2.1 mill. bbls in 1998, and are 
projected to be 2.7 and 3.2 mill. bbls in 1999 and 2000, respectively. 
The Committee also reported that, in recent months, producer prices 
have responded to this surplus by dropping from $70-80/barrel to $38/
barrel.
    The Committee plans a series of producer meetings throughout the 
10-State production area to inform producers about positive actions 
being

[[Page 34706]]

undertaken by the Committee to help strengthen marketing conditions. 
Some of these actions include proposing amendments to the order, and 
filing an application with the Department's Foreign Agricultural 
Service for Market Access Program funds to help the industry further 
develop export markets for cranberries and cranberry products. The 
industry also is working with Congress on amendments to the Act to 
include reporting requirements for processors and importers, and adding 
cranberries to the list of commodities with the authority to establish 
marketing research projects, including paid advertising, to more 
effectively promote cranberries and cranberry products.
    The Committee believes that a temporary delay in holding the 
continuance referendum provided time for its actions to help stabilize 
the current marketing situation. The Committee further believes that 
holding a continuance referendum in May 1999, given the current 
unsettled marketing situation, would not have provided a true indicator 
of support for and the value of the order.
    Pursuant to Sec. 929.69(b), the interim final rule suspended 
provisions in Sec. 929.69(d) to postpone the May 1999 continuance 
referendum under the cranberry marketing order. The Department 
currently plans to conduct a producer continuance referendum in May 
2000. However, a final decision on holding that referendum will not be 
made until the spring of 2000. The Committee traditionally meets each 
year during the months of February or March to assess the current 
marketing situation and prospects for the upcoming season. The 
Committee's assessment of marketing conditions at that time will be 
used in making the final decision. In accordance with Sec. 929.69(d) of 
the order, a continuance referendum is required to be held in May 2003.

The Regulatory Flexibility Act and Effects on Small Businesses

    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA), 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 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 20 handlers of cranberries who are subject 
to regulation under the order and approximately 1,100 producers of 
cranberries in the regulated area. Small agricultural service firms, 
which include handlers, 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. The majority of handlers 
and producers of cranberries may be classified as small entities.
    The interim final rule temporarily suspended a provision in the 
order requiring a producer referendum to be held in May 1999 to 
determine whether producers favor continuance of the order.
    Section 929.69(d) of the order provides that the Secretary shall 
conduct a referendum during the month of May 1975 to ascertain whether 
continuance of the order is favored by the producers, and that the 
Secretary shall conduct such a referendum during the month of May of 
every fourth year thereafter. The next continuance referendum was 
scheduled to be conducted in May 1999. The last continuance referendum 
was held in May 1995.
    Section 929.69(b) of the order authorizes the Secretary to 
terminate or suspend the operation of any or all of the provisions of 
this part whenever the Secretary finds that such provisions do not tend 
to effectuate the declared policy of the Act.
    At its March 15, 1999, meeting, the Committee recommended delaying 
the May 1999 referendum because the cranberry industry currently is 
experiencing significant marketing problems. Over the last few months, 
inventories of cranberry juice have been at record levels and producer 
prices have dropped significantly.
    The Committee reported that, over the last five years, the industry 
has enjoyed increasing demand for cranberry products, primarily due to 
the success of numerous cranberry juice based beverages. However, such 
success has attracted additional production. With increased production 
and a leveling of demand, carry-out stocks of cranberry juice and juice 
products are at record levels and are predicted to increase 
significantly over the next few years. The Committee reported that 
carryout stocks at the end of August were approximately 1.2 million 
(mill.) barrels (bbls) in 1997, 2.1 mill. bbls in 1998, and are 
projected to be 2.7 and 3.2 mill. bbls in 1999 and 2000, respectively. 
The Committee also reported that, in recent months, producer prices 
have responded to this surplus by dropping from $70-80/barrel to $38/
barrel.
    The Committee plans a series of producer meetings throughout the 
10-State production area to inform producers about positive actions 
being undertaken by the Committee to help strengthen marketing 
conditions. Some of these actions include proposing amendments to the 
order, and filing an application with the Department's Foreign 
Agricultural Service for Market Access Program funds to help the 
industry further develop export markets for cranberries and cranberry 
products. The industry also is working with Congress on amendments to 
the Act to include reporting requirements for processors and importers, 
and adding cranberries to the list of commodities with the authority to 
establish marketing research projects, including paid advertising, to 
more effectively promote cranberries and cranberry products.
    The Committee believes that a temporary delay in holding the 
continuance referendum provided time for its actions to help stabilize 
the current marketing situation. The Committee further believes that 
holding a continuance referendum in May 1999, given the current 
unsettled marketing situation, would not have provided a true indicator 
of support for and the value of the order.
    Pursuant to Sec. 929.69(b), this action suspended provisions in 
Sec. 929.69(d) to postpone the May 1999 continuance referendum under 
the cranberry marketing order. The Department currently plans to 
conduct a producer continuance referendum in May 2000. This should 
serve as an alternative to just suspending the May 1999 continuance 
referendum. However, a final decision on holding that referendum will 
not be made until the spring of 2000. The Committee traditionally meets 
each year during the months of February or March to assess the current 
marketing situation and prospects for the upcoming season. The 
Committee's assessment of marketing conditions at that time will be 
used in making the final decision. In accordance with Sec. 929.69(d) of 
the order, a continuance referendum is required to be held in May 2003.
    This action did not impose any additional recordkeeping 
requirements on either small or large cranberry handlers. As with all 
Federal marketing order programs, reports and forms are periodically 
reviewed to reduce information requirements and

[[Page 34707]]

duplication by industry and public sectors. In addition, the Department 
has not identified any relevant Federal rules which duplicate, overlap 
or conflict with this rule.
    In compliance with Office of Management and Budget (OMB) 
regulations (5 CFR part 1320) which implement the Paperwork Reduction 
Act of 1995 (44 U.S.C. Chapter 35), the information collection and 
recordkeeping requirements imposed by Part 929 have been previously 
approved by OMB and assigned OMB Number 0581-0103.
    Committee meetings are widely publicized throughout the cranberry 
industry and are open to all industry members and entities (including 
both small and large business entities) and other interested persons--
who are encouraged to participate in the deliberations and voice their 
opinions on topics under discussion. Like all Committee meetings, the 
March 1999 meeting was a public meeting and all entities, both large 
and small, were able to express their views on these issues. The 
Committee itself is composed of eight members, of which seven members 
are growers and one represents the public.
    The interim final rule concerning this action was published in the 
Federal Register (64 FR 24023, May 5, 1999) with an effective date of 
May 6, 1999, through May 31, 1999. Copies of the rule were mailed by 
the Committee's staff to all Committee members and cranberry producers. 
In addition, the rule was made available through the Internet by the 
Office of the Federal Register. That rule provided for a 15-day comment 
period which ended May 20, 1999. No comments were received.
    After consideration of all available information, and pursuant to 
Sec. 929.69(b), it is found that the second sentence in Sec. 929.69(d) 
does not tend to effectuate the declared policy of the Act for the 
period specified in the interim final rule and it is temporarily 
suspended.

List of Subjects in 7 CFR Part 929

    Cranberries, Marketing agreements, Reporting and recordkeeping 
requirements.

PART 929--CRANBERRIES GROWN IN THE STATES OF MASSACHUSETTS, RHODE 
ISLAND, CONNECTICUT, NEW JERSEY, WISCONSIN, MICHIGAN, MINNESOTA, 
OREGON, WASHINGTON, AND LONG ISLAND IN THE STATE OF NEW YORK

    Accordingly the interim final rule amending 7 CFR part 929 which 
was published at 64 FR 24023 on May 5, 1999, is adopted as a final rule 
without change.

    Dated: June 17, 1999.
Enrique E. Figueroa,
Administrator, Agricultural Marketing Service.
[FR Doc. 99-16508 Filed 6-28-99; 8:45 am]
BILLING CODE 3410-02-P