[Federal Register Volume 65, Number 66 (Wednesday, April 5, 2000)]
[Rules and Regulations]
[Pages 17756-17758]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-8299]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 985

[Docket No. FV00-985-4 IFR]


Marketing Order Regulating the Handling of Spearmint Oil Produced 
in the Far West; Decreased Assessment Rate

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Interim final rule with request for comments.

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SUMMARY: This rule decreases the assessment rate established for the 
Spearmint Oil Administrative Committee (Committee) for the 2000-2001 
and subsequent marketing years from $0.10 per pound to $0.09 per pound 
of spearmint oil handled. The Committee is responsible for local 
administration of the marketing order which regulates the handling of 
spearmint oil produced in the Far West. Authorization to assess 
spearmint oil handlers enables the Committee to incur expenses that are 
reasonable and necessary to administer the program. The marketing year 
begins June 1 and ends May 31. The assessment rate will remain in 
effect indefinitely unless modified, suspended, or terminated.

DATES: Effective June 1, 2000. Comments received by May 5, 2000, will 
be considered prior to issuance of a final rule.

ADDRESSES: Interested persons are invited to submit written comments 
concerning this rule. Comments must be sent to the Docket Clerk, 
Marketing Order Administration Branch, 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]. 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: Robert J. Curry, Northwest Marketing 
Field Office, Marketing Order Administration Branch, Fruit and 
Vegetable Programs, AMS, USDA, 1220 SW Third Avenue, room 369, 
Portland, Oregon 97204; telephone: (503) 326-2724, Fax: (503) 326-7440; 
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 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: [email protected].

SUPPLEMENTARY INFORMATION: This rule is issued under Marketing Order 
No. 985, as amended (7 CFR part 985), regulating the handling of 
spearmint oil produced in the Far West (Washington, Idaho, Oregon, and 
designated parts of Nevada and Utah), hereinafter referred to as the 
``order.'' 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 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, Far West 
spearmint oil 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 
spearmint oil beginning June 1, 2000, 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 decreases the assessment rate established for the 
Committee for the 2000-2001 and subsequent marketing years from $0.10 
per pound to $0.09 per pound of spearmint oil handled.
    The spearmint oil 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 of spearmint oil. 
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 1995-1996 and subsequent marketing years, the Committee 
recommended, and the Department approved, an assessment rate that would 
continue in effect from marketing year to marketing 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 February 23, 2000, and unanimously recommended 
2000-2001 expenditures of $212,900 and an assessment rate of $0.09 per 
pound of spearmint oil handled. In comparison, last year's budgeted 
expenditures were $219,028. The assessment rate of $0.09 is $0.01 lower 
than the rate currently in effect. The Committee discussed assessment 
rates both lower and greater than $0.09 per pound. However, the 
Committee decided that an assessment rate of less than $0.09 would not 
generate the income necessary to administer the program with an 
adequate reserve. The Committee recommended the decreased assessment 
rate to help offset the negative effects the current depressed 
spearmint oil market is having on the industry.
    Expenditures recommended by the Committee for the 2000-2001 
marketing year include $178,500 for Committee expenses and $34,400 for 
administrative expenses. For 2000-2001, a total of $156,000 is budgeted 
for agency fees, $21,000 is budgeted for Committee per diem and travel, 
$16,500 is budgeted for agency staff travel, and $10,700 is budgeted 
for copying, mail handling,

[[Page 17757]]

postage, telephone and fax, cellular phone charges, officer liability 
insurance, and auditing. Actual expenses for these items in 1999-2000 
are estimated to total $165,000, $22,133, $16,843, and $10,900. For 
2000-2001, funds also are budgeted for market development ($5,000) and 
for compliance ($1,000). Expenditures for these items in 1999-2000 are 
expected to total $5,000.
    The Committee estimates that spearmint oil sales for the 2000-2001 
marketing year will be approximately 2,058,474 pounds, which should 
provide $185,263 in assessment income. This assessment income, when 
combined with $13,029 from the monetary reserve, $3,500 in interest 
income, and $11,108 from the sale of certain assets should be adequate 
to meet this year's expenses of $212,900. The Committee estimates that 
its monetary reserve will be approximately $156,757 at the beginning of 
the 2000-2001 marketing year. It is not anticipated that the reserve 
fund will exceed the maximum permitted by the order of approximately 
one marketing year's operational expense (Sec. 985.42).
    The assessment rate established in this rule will 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 will continue to meet prior to or during each 
marketing 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 will 
evaluate Committee recommendations and other available information to 
determine whether modification of the assessment rate is needed. 
Further rulemaking will be undertaken as necessary. The Committee's 
2000-2001 budget and those for subsequent marketing years will 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, the 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 7 spearmint oil 
handlers subject to regulation under the marketing order and 
approximately 119 producers of Scotch spearmint oil and 105 producers 
of Native spearmint oil in the regulated production area. Small 
agricultural service firms are defined by the Small Business 
Administration (SBA) (13 CFR 121.201) as those having annual receipts 
of less than $5,000,000, and small agricultural producers have been 
defined as those whose annual receipts are less than $500,000.
    Based on the SBA's definition of small entities, the Committee 
estimates that 2 of the 7 handlers regulated by the order could be 
considered small entities. Most of the handlers are large corporations 
involved in the international trading of essential oils and the 
products of essential oils. In addition, the Committee estimates that 
25 of the 119 Scotch spearmint oil producers and 7 of the 105 Native 
spearmint oil producers would be classified as small entities under the 
SBA definition. Thus, a majority of handlers and producers of Far West 
spearmint oil may not be classified as small entities.
    This rule decreases the assessment rate established for the 
Committee and collected from handlers for the 2000-2001 and subsequent 
marketing years from $0.10 per pound to $0.09 per pound of spearmint 
oil handled. The Committee estimates that spearmint oil sales will 
total 2,058,474 pounds in the 2000-2001 marketing year. The $0.09 per 
pound assessment rate should provide an estimated income of $185,263, 
which, when combined with $13,029 from the monetary reserve, $3,500 in 
interest income, and $11,108 from the sale of certain assets should be 
adequate to meet this year's expenses of $212,900. The Committee 
estimates that its monetary reserve will be approximately $156,757 at 
the beginning of the 2000-2001 marketing year and that the fund will 
not exceed the maximum permitted by the order of approximately one 
marketing year's operational expense (Sec. 985.42).
    The Committee reviewed and unanimously recommended 2000-2001 
expenditures of $212,900 which is $6,128 less than approved for last 
year. Prior to arriving at this budget, the Committee considered 
information from various sources, including the Committee's Executive 
Committee and the current marketing year's actual and anticipated 
expenditures. Alternative expenditure levels and assessment rates were 
discussed by the Committee officers prior to presentation to the full 
Committee for approval. The Committee decided that an assessment rate 
of less than $0.09 would not generate the income necessary to 
administer the program with an adequate reserve. The Committee 
recommended the decreased assessment rate to help offset the negative 
effects the current depressed spearmint oil market is having on the 
industry.
    Expenditures recommended by the Committee for the 2000-2001 
marketing year include $178,500 for Committee expenses and $34,400 for 
administrative expenses. For 2000-2001, a total of $156,000 is budgeted 
for agency fees, $21,000 is budgeted for Committee per diem and travel, 
$16,500 is budgeted for agency staff travel, and $10,700 is budgeted 
for copying, mail handling, postage, telephone and fax, cellular phone 
charges, officer liability insurance, and auditing. Actual expenses for 
these items in 1999-2000 are estimated to total $165,000, $22,133, 
$16,843, and $10,900. For 2000-2001, funds also are budgeted for market 
development ($5,000) and for compliance ($1,000). Expenditures for 
these items in 1999-2000 are expected to total $5,000.
    Based on 1999 prices, the average price paid to producers for both 
Scotch and Native spearmint oils during the 2000-2001 marketing year 
could be about $9.80 per pound. Therefore, the estimated assessment 
revenue for the 2000-2001 marketing year as a percentage of total 
producer revenue could be about 0.92 percent.
    This action decreases the assessment obligation imposed on 
handlers. While this rule will impose some additional costs on 
handlers, the costs are minimal and in the form of uniform assessments 
on all handlers. Some of the additional costs may be passed on to 
producers. However, these costs will be offset by the benefits derived 
by the operation of the order. In addition, the Committee's meeting was 
widely publicized throughout the Far West spearmint oil industry and 
all interested persons were invited to attend the meeting and 
participate in Committee deliberations on all issues. Like all 
Committee meetings, the February 23, 2000, 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

[[Page 17758]]

information on the regulatory and informational impacts of this action 
on small businesses.
    This action imposes no additional reporting or recordkeeping 
requirements on either small or large spearmint oil 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 small business guide on complying with fruit, vegetable, and 
specialty crop marketing agreements and orders may be viewed at the 
following web site: http://www.ams.usda.gov/fv/moab.html. Any questions 
about the compliance guide should be sent to Jay Guerber at the 
previously mentioned address in the FOR FURTHER INFORMATION CONTACT 
section.
    After consideration of all relevant material presented, including 
the information and recommendation submitted by the Committee and other 
available information, it is hereby found that this rule, as 
hereinafter set forth, will tend to effectuate the declared policy of 
the Act.
    Pursuant to 5 U.S.C. 553, it is also found and determined upon good 
cause that it is impracticable, unnecessary, and contrary to the public 
interest to give preliminary notice prior to putting this rule into 
effect because: (1) The 2000-2001 marketing year begins June 1, 2000, 
and the marketing order requires that the rate of assessment for each 
marketing year apply to all assessable spearmint oil handled during 
such marketing year; (2) this action decreases the assessment rate for 
assessable spearmint oil beginning with the 2000-2001 marketing year; 
(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) this interim final rule 
provides a 60-day comment period, and all comments timely received will 
be considered prior to finalization of this rule.
    Interested persons are invited to comment on this rule. A 30-day 
comment period is provided. This period is deemed appropriate because 
the 2000-2001 marketing year begins June 1, 2000.

List of Subjects in 7 CFR Part 985

    Marketing agreements, Oils and fats, Reporting and recordkeeping 
requirements, Spearmint oil.

    For the reasons set forth in the preamble, 7 CFR part 985 is 
amended as follows:

PART 985--MARKETING ORDER REGULATING THE HANDLING OF SPEARMINT OIL 
PRODUCED IN THE FAR WEST

    1. The authority citation for 7 CFR part 985 continues to read as 
follows:

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


    2. Section 985.141 is revised to read as follows:


Sec. 985.141  Assessment rate.

    On and after June 1, 2000, an assessment rate of $0.09 per pound is 
established for Far West spearmint oil. Unexpended funds may be carried 
over as a reserve.

    Dated: March 30, 2000.
Robert C. Keeney,
Deputy Administrator, Fruit and Vegetable Programs.
[FR Doc. 00-8299 Filed 4-4-00; 8:45 am]
BILLING CODE 3410-02-P