[Federal Register Volume 64, Number 206 (Tuesday, October 26, 1999)]
[Proposed Rules]
[Pages 57597-57600]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-27744]


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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. 64, No. 206 / Tuesday, October 26, 1999 / 
Proposed Rules  

[[Page 57597]]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 932

[Docket No. FV99-932-3 PR]


Olives Grown in California; Revisions to Handling Requirements 
and Notice of Request for Revision of a Currently Approved Information 
Collection

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule.

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SUMMARY: This proposal invites comments on revisions to the handling 
requirements under the California olive marketing order and announces 
the Agricultural Marketing Service's (AMS) intention to request a 
revision to the currently approved information collection requirements 
issued under the marketing order. The olive marketing order regulates 
the handling of olives grown in California, and is administered locally 
by the California Olive Committee (committee). This rule would 
establish exemption and safeguard requirements for handlers desiring to 
ship a small portion of their olives as new packaged olive products for 
test marketing and market development projects. If implemented, this 
rule would help provide uniform procedures under the order and improve 
overall program administration.

DATES: Comments must be received by December 27, 1999.

ADDRESSES: Interested persons are invited to submit written comments 
concerning this proposal. Comments must be sent to the Docket Clerk, 
Fruit and Vegetable Programs, AMS, USDA, room 2525-S, PO Box 96456, 
Washington, DC 20090-6456; Fax: (202) 720-5698; or E-mail: 
[email protected]. All comments should reference the docket 
number and the date and page number of this issue of the Federal 
Register and will be made available for public inspection in the Office 
of the Docket Clerk during regular business hours.

FOR FURTHER INFORMATION CONTACT: Terry Vawter, 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, Fruit and Vegetable 
Programs, 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 proposal is issued under Marketing 
Agreement No. 148 and Marketing 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 proposed 
rule in conformance with Executive Order 12866.
    This proposal has been reviewed under Executive Order 12988, Civil 
Justice Reform. This rule is not intended to have retroactive effect. 
This proposal 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.
    This proposal invites comments on revisions to handling 
requirements under the order for olives grown in California. The 
revision would implement procedures and reporting requirements for 
handlers desiring to use a small portion of their olives to test market 
and initiate market development projects for new packaged olive 
products. The procedures include completion and submission of a new 
form, the COC Form 155, and approval by committee staff. This rule also 
announces AMS's intention to request a revision to the currently-
approved information collection requirements issued under the marketing 
order.
    Sections 932.51 and 932.52 of the olive marketing order authorize 
regulatory requirements regarding the handling of California packaged 
olives. Such requirements include incoming and outgoing handling 
requirements with regard to quality, size, and style of olives. Certain 
of these requirements are implemented under Sec. 932.149. Styles of 
olives include whole, pitted, sliced, segmented (wedged), halved, 
chopped, and broken pitted. Under this proposal, handlers would be 
permitted to use other styles of olives and to add other ingredients to 
the finished product, such as flavorings, pieces of garlic, or jalapeno 
peppers.
    Section 932.55 of the order provides authority for exempting from 
any or all requirements handlers handling olives which are used for 
specified purposes, including shipments of olives used to facilitate 
the conduct of marketing research and development projects. Section 
932.55 of the order also provides authority for the committee to 
recommend rules, regulations, and safeguards necessary to ensure that

[[Page 57598]]

olives exempted under the provisions of this section are handled only 
as authorized.
    Section 932.155 of the order's rules and regulations provides 
specific safeguards for certain special purpose shipments of packaged 
olives. However, these regulations do not include requirements and 
procedures related to shipping packaged olives for test marketing and 
market development. In the past, the committee has on occasion approved 
such marketing projects. This rule proposes revising Sec. 932.155 for 
the purpose of clarifying the language and to include an exemption and 
safeguards in the rules and regulations for shipments of new packaged 
products for test marketing and market development. This would clarify 
existing practices in the regulations, and would establish uniform 
procedures for all handlers to ensure that the handling of new product 
packaged olives exempted under the provisions of Sec. 932.55 will be 
handled only as authorized. Such new products could include packaged 
olives of different styles than those earlier mentioned containing 
various ingredients or flavorings, such as pieces of garlic, or 
jalapeno peppers.
    The proposed rule includes a new form, the COC 155. Prior to 
engaging in test marketing and initiating market development projects 
for a new product, a handler would be required to file the COC 155 with 
the committee. The form includes: (1) The name and address of the 
requesting handler; (2) the quantity of olives to be utilized (limited 
to not more than five percent of the applicant handler's crop year 
acquisitions); (3) specific market outlet; (4) flavorings or other 
ingredients added to the olives; (5) style of olives used; (6) type of 
olives used, either black or green ripe; (7) container sizes; (8) 
varieties used, whether Ascolano, Barouni, Manzanillo, Mission, 
Sevillano, etc.; (9) sizes of olives utilized; (10) approximate dates 
on which the new product will be packaged; (11) place of inspection; 
(12) certification that all assessments and reporting in effect under 
the marketing order will be met prior to shipment; (13) certification 
that all such fruit will be kept separate from other packaged olives 
and will be so identified by control cards or other means acceptable to 
the Inspection Service; (14) purpose and nature of the request, whether 
for test marketing, evaluation, market research, etc.; and (15) an 
estimate of the amount of time required to complete the market-test. 
The committee shall promptly approve or deny the application, and may 
add limitations to any such approval.
    Any product remaining at the end of the test-market period shall be 
disposed of according to paragraph (a) of Sec. 932.155, which specifies 
procedures for disposing of packaged olives in the production of olive 
oil, donating to a charitable organization, and by dumping.
    On December 10, 1998, the committee met to discuss the 
recommendation. Additional discussion occurred at various subcommittee 
meetings prior to the December 10, 1998, committee meeting.
    According to the committee, demand for packaged olives has remained 
relatively stagnant in recent years. The committee believes that to 
improve returns to producers and handlers, handlers must have the 
flexibility to respond to shifting trends in the marketplace by test 
marketing new products. Handlers must be allowed the opportunity to try 
marketing innovative new products free from certain marketing order 
obligations, such as style and flavor requirements, which appear to be 
too restrictive for these new products. Such shipments, will, 
therefore, be exempt from the requirements of Sec. 932.149. Because it 
appears that such shipments can comply with all other order 
requirements, they will remain applicable. This would allow the 
handlers to respond to marketing opportunities and requests from 
buyers, which could result in increased olive sales. In addition, since 
handlers have large amounts of capital invested in their processing 
plants, any increase in the amount of olives processed yields a 
reduction of per unit processing costs, which is a benefit to handlers 
and producers.
    It has been the industry's experience that the ability to ship new 
products for test marketing and market development helps to encourage 
handlers to develop new product lines. The committee believes that this 
option should continue to be available, allowing handlers to take 
advantage of additional marketing opportunities to expand the market 
for processed olives. Adding procedures to the rules and regulations 
will help clarify the existing practice, and will provide uniform 
requirements for handlers.
    Therefore, when the committee met in December, it unanimously 
recommended modifying the rules and regulations to specify procedures 
and reporting requirements to permit handlers to ship a small portion 
of their olives for new packed olive products for test marketing and 
market development projects. In addition, the committee recommended 
development of a new form, the COC Form 155, that handlers interested 
in test marketing and market development projects for new olive 
products must complete and file with the committee.
    The information supplied by the applicant handler would provide the 
committee with information necessary to ensure that the product is used 
for test marketing or for marketing development projects and that the 
Inspection Service is aware of the product.
    The new COC Form 155 will require a revision in the information 
collection requirements under the order. It is estimated that COC Form 
155 would require 20 minutes for the applicant handlers to complete. It 
is expected that this could result in an increased reporting burden to 
handlers. The increased burden is estimated to be 20 minutes per 
handler annually. If all three handlers applied, the COC Form 155 would 
add 1 hour in total annual hours to the current response burden.
    The information collection requirements contained in the referenced 
Sec. 932.155 will require approval by the Office of Management and 
Budget (OMB) under the provisions of 44 U.S.C. Chapter 35.
    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 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 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 subject to regulation under the order and 
approximately 1,200 producers of olives 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. The majority of producers 
may be classified as small entities.
    A review of historical and preliminary information pertaining to 
the current fiscal year (January 1 through December 31) indicates that 
the total grower revenue for the 1999 crop year (August

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1 through July 31) is estimated to be approximately $39,500,000, and 
the average grower revenue approximately $33,000. Thus, it can be 
concluded that the majority of producers of California olives may be 
classified as small entities.
    This rule would revise Sec. 932.155 to include requirements for 
handlers desiring to ship olives to test markets and initiate market 
development projects for small quantities of new olive products. This 
rule would also reformat Sec. 932.155 for purposes of clarity.
    An alternative to this action would be to maintain the status quo, 
whereby the regulations would not address the needs of handlers 
desiring to ship new products for test marketing and market 
development. However, the committee and the Department believe that 
regulations should be modified to address these needs. This would help 
ensure uniform requirements and procedures are followed by handlers who 
desire to test market and initiate market development projects. Such 
activity could ultimately result in increasing sales of processed 
olives.
    Under this proposed rule, the committee would review written 
requests from handlers interested in test marketing and market 
development of new product lines. Such requests would be made on a new 
form, the COC 155, which would require uniform information from all 
applicant 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. 
This new form is anticipated to be utilized when handlers have 
developed new product lines which they desire to test market. 
Accordingly, this action would impose an additional reporting or 
recordkeeping requirement on three olive handlers by requiring COC Form 
155 to be filed prior to the test marketing of a new canned olive 
product. The form is estimated to take approximately 20 minutes to 
complete. There are only three handlers regulated under the order, and 
the additional burden created by the use of this form by all handlers 
is estimated to be 1 annual hour.
    The Department has not identified any relevant Federal rules that 
duplicate, overlap, or conflict with this proposed rule.
    In addition, the committee's meeting was widely publicized 
throughout the olive industry and all interested persons were 
encouraged 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 encouraged to express views on this issue. The committee is 
comprised of 16 members, of which 8 are producers and 8 are handlers. 
Each of the three handler entities is presently represented on the 
committee. Finally, interested persons are invited to submit 
information on the regulatory and informational impacts of this action 
on small businesses.

Paperwork Reduction Act

    In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 
Chapter 35), AMS announces its intention to request a revision to a 
currently approved information collection for olives grown in 
California, Marketing Order No. 932.
    Title: Olives Grown in California, Marketing Order 932.
    OMB Number: 0581-0142.
    Expiration Date of Approval: October 31, 2000.
    Type of Request: Revision of a currently approved information 
collection.
    Abstract: Marketing order programs provide an opportunity for 
producers of fresh fruits, vegetables, and specialty crops, in a 
specified production area, to work together to solve marketing problems 
that cannot be solved individually. Order regulations help ensure 
adequate supplies of good quality product and adequate returns to 
producers. Under the Agricultural Marketing Agreement Act of 1937 
(Act), as amended (7 U.S.C. 601-674), marketing order programs are 
established if favored by producers in referenda. The handling of the 
commodity is regulated. The Secretary of Agriculture is authorized to 
oversee order operations and issue regulations recommended by a 
committee of representatives from each commodity industry.
    The information collection requirements in this request are 
essential to carry out the intent of the Act, to provide the 
respondents the type of service they request, and to administer the 
California olive marketing order program, which has been operating 
since 1965.
    The California olive marketing order authorizes the issuance of 
quality, size, and inspection requirements. The order also has 
authority for research and development projects, including paid 
advertising. Pursuant to section 8e of the Act, import grade and size 
requirements are implemented on olives imported into the United States.
    The order and its rules and regulations authorize the California 
Olive Committee (committee), the agency responsible for local 
administration of the order, to require handlers and producers to 
submit certain information. Much of this information is compiled in 
aggregate and provided to the industry to assist in marketing 
decisions.
    The committee has developed forms as a means for persons to file 
required information with the committee relating to olive supplies, 
shipments, dispositions, and other information necessary to effectively 
carry out the purpose of the Act and the order. California olives are 
shipped year-round and these forms are used accordingly.
    These forms require the minimum information necessary to 
effectively carry out the requirements of the order, and their use is 
necessary to fulfill the intent of the Act as expressed in the order.
    The information collected would be used only by authorized 
representatives of the USDA, including AMS, Fruit and Vegetable 
Programs regional and headquarter's staff, and authorized employees of 
the committee. Authorized committee employees and the industry are the 
primary users of the information and AMS is the secondary user.
    This proposed collection consists of a requirement for handlers to 
file a form with the committee for approval to ship new olive products 
to be test marketed.
    The committee believes that to improve returns to producers and 
handlers, handlers should be encouraged to look for outlets for new 
product lines. One method to encourage development of new products is 
to continue to allow test marketing of such products by including 
authority in the rules and regulations that is uniformly applied to all 
handlers. The information supplied by the applicant handler would 
provide the committee with information necessary to ensure that the 
product is used for test marketing or for marketing development 
projects and that the inspection service is aware of the product.
    Estimate of Burden: Public reporting burden for this collection of 
information is estimated to average \1/3\ hour per response.
    Respondents: California olive handlers.
    Estimated Number of Respondents: 3
    Estimated Number of Responses per Respondent: one annually.
    Estimated Total Annual Burden on Respondents: 1 hour.
    Comments are invited on: (1) Whether the proposed collection of the 
information is necessary for the proper performance of the functions of 
the agency, including whether the

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information will have practical utility; (2) the accuracy of the 
agency's estimate of the burden of the proposed collection of 
information, including the validity of the methodology and assumptions 
used; (3) ways to enhance the quality, utility and clarity of the 
information to be collected; and (4) ways to minimize the burden of the 
collection of information on those who are to respond, including 
through the use of appropriate automated, electronic, mechanical, or 
other technological collection techniques or other forms of information 
technology.
    Comments should reference OMB No. 0581-0142 and California Olive 
Marketing Order No. 932, and be sent to the USDA in care of the docket 
clerk at the address referenced above. All comments received will be 
available for public inspection during regular business hours at the 
same address and will become a matter of public record.
    A 60-day comment period is provided to allow interested persons to 
respond to this proposal. All responses to this notice will be 
summarized and included in the request for OMB approval.

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. In Sec. 932.155, paragraphs (a) and (b) are revised to read as 
follows:


Sec. 932.155  Special purpose shipments.

    (a) The disposition of packaged olives covered by Sec. 932.152(d) 
which are not reprocessed, and new packaged olive products covered 
under paragraph (b) of this section which have not been disposed of by 
the end of the test market period, shall be handled in conformity with 
the applicable provisions of this paragraph.
    (1) Under supervision of the Inspection Service, such packaged 
olives may be disposed of for use in the production of olive oil or 
dumped.
    (2) Such packaged olives may be disposed of to a charitable 
organization for use by such organization, provided the following 
conditions are met:
    (i) Any handler who wishes to so dispose of olives shall first file 
a written application with, and obtain written approval thereof from, 
the committee. Each such application shall contain at least:
    (A) The name and address of the handler and the charitable 
organization;
    (B) The physical location of the charitable organization's 
facilities;
    (C) The quantity in cases, the variety, size, can size, and can 
code of the packaged olives; and
    (D) A certification from the charitable organization that such 
olives will be used by the organization and will not be sold.
    (ii) Prior to approval, the committee shall perform such 
verification of the accuracy of the information on the application as 
it deems necessary. The committee may deny any application if it finds 
that the required information is incomplete or incorrect, or has reason 
to believe that the intended receiver is not a charitable organization, 
or that the handler or the organization has disposed of packaged olives 
contrary to a previously approved application. The committee shall 
notify the applicant and the organization in writing of its approval, 
or denial, of the application. Any such approval shall continue in 
effect so long as the packaged olives covered thereby are disposed of 
consistent with this section. The committee shall notify the handler 
and the organization of each such termination of approval. The handler 
shall furnish the committee upon demand such evidence of disposition of 
the packaged olives covered by an approved application as may be 
satisfactory to the committee.
    (b) In accordance with the provisions of Sec. 932.55(b), packaged 
olives to be used in marketing development projects may be handled 
without regard to Sec. 932.149 provided the following conditions are 
met. Such olives must be identified to the satisfaction of the 
Inspection Service and kept separate from other packaged olives. The 
handler shall submit to the committee for its approval ``COC Form 155'' 
at least 10 working days prior to the shipment of such packaged olives 
to test markets, and report progress or changes to the committee, as 
requested. The applicant handler shall provide the following 
information on COC Form 155:
    (1) The quantity of olives to be utilized (limited to not more than 
five percent of the handler's crop year acquisitions);
    (2) Specific market outlet;
    (3) Flavorings or other ingredients added to the olives;
    (4) Style of olives used;
    (5) Type of olives used, either black or green ripe;
    (6) Container sizes;
    (7) Varieties used, whether Ascolano, Barouni, Manzanillo, Mission, 
Sevillano, etc.;
    (8) Sizes of olives utilized;
    (9) Approximate dates when the new product will be packaged;
    (10) Name and address of requesting handler;
    (11) Place of inspection;
    (12) Certification that all assessment and reporting requirements 
in effect under the marketing order will be met prior to shipment;
    (13) Certification that all such fruit will be kept separate from 
other packaged olives and will be so identified by control cards or 
other means acceptable to the Inspection Service;
    (14) Purpose and nature of the request, whether for test marketing, 
evaluation, market research, etc.; and
    (15) An estimate of the amount of time required to complete the 
test. The committee shall promptly approve or deny the application, and 
may add limitations to any such approval. Upon approval, the applicant 
handler shall notify the Inspection Service. Packaged olives so 
identified and remaining unused at the end of the approved test-market 
period shall be disposed of according to paragraph (a) of this section.
* * * * *
    Dated: October 18, 1999.
Robert C. Keeney,
Deputy Administrator, Fruit and Vegetable Programs.
[FR Doc. 99-27744 Filed 10-25-99; 8:45 am]
BILLING CODE 3410-02-P