[Federal Register Volume 65, Number 152 (Monday, August 7, 2000)]
[Rules and Regulations]
[Pages 48139-48142]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-19873]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 930

[Docket No. FV00-930-3 FR]


Tart Cherries Grown in the States of Michigan, New York, 
Pennsylvania, Oregon, Utah, Washington, and Wisconsin; Decreased 
Assessment Rates

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

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SUMMARY: This rule decreases the assessment rate for cherries that are 
utilized in the production of tart cherry products other than juice, 
juice concentrate, or puree from $0.00225 to $0.0017 per pound. This 
rule also decreases the assessment rate for cherries utilized for 
juice, juice concentrate, or puree from $0.001125 to $0.00085 per 
pound. Both assessment rates are established for the Cherry Industry 
Administrative Board (Board) under Marketing Order No. 930 for the 
2000-2001 and subsequent fiscal periods. The Board is responsible for 
local administration of the marketing order which regulates the 
handling of tart cherries grown in the production area. Authorization 
to assess tart cherry handlers enables the Board to incur expenses that 
are reasonable and necessary to administer the program. The fiscal 
period begins July 1 and ends June 30. The assessment rate will remain 
in effect indefinitely unless modified, suspended, or terminated.

EFFECTIVE DATE: August 8, 2000.

FOR FURTHER INFORMATION CONTACT: Patricia A. Petrella or Kenneth G. 
Johnson, Marketing Order Administration Branch, Fruit and Vegetable 
Programs, AMS, USDA, Suite 2A04, Unit 155, 4700 River Road, Riverdale, 
Maryland 20737 telephone: (301) 734-5243; 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) 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: 
[email protected].

SUPPLEMENTARY INFORMATION: This rule is issued under Marketing 
Agreement and Order No. 930, both as amended (7 CFR part 930), 
regulating the handling of tart cherries grown in the States of 
Michigan, New York, Pennsylvania, Oregon, Utah, Washington, and 
Wisconsin, 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, tart cherry 
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 tart cherries 
beginning July 1, 2000, and continue until amended, suspended, or

[[Page 48140]]

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 Board 
for the 2000-2001 and subsequent fiscal periods for cherries that are 
utilized in the production of tart cherry products other than juice, 
juice concentrate, or puree from $0.00225 to $0.0017 per pound of 
cherries. The assessment rate for cherries utilized for juice, juice 
concentrate, or puree is decreased from $0.001125 to $0.00085 per 
pound.
    The tart cherry marketing order provides authority for the Board, 
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 Board are producers and handlers of tart 
cherries. They are familiar with the Board'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 1999-2000 fiscal period, the Board recommended, and the 
Department approved, an assessment rate that would continue in effect 
from fiscal period to fiscal period unless modified, suspended or 
terminated by the Secretary upon recommendation and information 
submitted by the Board or other information available to the Secretary.
    The Board met on March 2, 2000, and unanimously recommended 2000-
2001 expenditures of $455,000 and an assessment rate of $0.0017 per 
pound for cherries that are utilized in the production of tart cherry 
products other than juice, juice concentrate, or puree and an 
assessment rate of $0.00085 per pound of cherries utilized for juice, 
juice concentrate, or puree. In comparison, last year's budgeted 
expenditures were $497,780. Decreased assessment rates were recommended 
by the Board because the 2000 crop is expected to be large. In 
addition, the Board wants to reduce handler costs and keep its monetary 
reserve within the authorized maximum of approximately one year's 
operational expenses specified in Sec. 930.42(a) of the order. The 
decreased assessment rates together with funds from the Board's 
operating reserve and interest income are expected to generate enough 
income to meet the Board's reduced operating expenses in 2000-2001.
    The major expenditures recommended by the Board for the 2000-2001 
fiscal period include $175,000 for personnel, $120,000 for compliance, 
and $75,000 for Board meetings. Budgeted expenses for these items in 
1999-2000 were $222,780 for personnel, $100,000 for Board meetings, and 
$100,000 for compliance.
    The order provides that when an assessment rate based on the number 
of pounds of tart cherries handled is established, it should provide 
for differences in relative market values for various cherry products. 
The discussion of this provision in the order's promulgation record 
indicates that proponents testified that cherries utilized in high 
value products such as frozen, canned, or dried cherries should be 
assessed one rate while cherries used to make low value products such 
as juice concentrate or puree should be assessed at one-half that rate.
    Data from the National Agricultural Statistics Service (NASS) 
states that for 1998, tart cherry utilization for juice, wine, or 
brined uses was 28.3 million pounds for all districts covered under the 
order. The total processed amount for 1998 was 303.8 million pounds. 
Juice, wine, and brined tart cherries represented less than 10 percent 
of the total processed crop, and about 8 percent over the last three 
seasons (1996 through 1998).
    In deriving the recommended the assessment rates, the Board 
estimated assessable tart cherry production for the 2000-2001 crop year 
at 260 million pounds. It further estimated that about 245 million 
pounds of the assessable poundage would be utilized in the production 
of high-valued products, like frozen, canned, or dried cherries, and 
that about 15 million pounds would be utilized in the production of 
low-valued products, like juice, juice concentrate, or puree. Potential 
assessment income from the high valued products would be approximately 
$416,500 (245 million pounds  x  $0.0017 per pound). The potential 
income from tart cherries utilized for juice, juice concentrate, or 
puree would be $12,750 (15 million pounds  x  $0.00085 per pound). 
Therefore, the total assessment income for 2000-2001 is estimated at 
$429,250. This amount plus adequate supplies in the reserve and 
interest income will be sufficient to cover budgeted expenses. Funds in 
the reserve (currently $300,000) will be kept within the approximately 
one year's operational expenses permitted by the order (7 CFR 
930.42(a)).
    The assessment rates established in this rule will continue in 
effect indefinitely unless modified, suspended, or terminated by the 
Secretary upon recommendation and information submitted by the Board or 
other available information.
    Although the assessment rates are effective for an indefinite 
period, the Board will continue to meet prior to or during each fiscal 
period to recommend a budget of expenses and consider recommendations 
for modification of the assessment rate. The dates and times of Board 
meetings are available from the Board or the Department. Board meetings 
are open to the public and interested persons may express their views 
at these meetings. The Department will evaluate Board recommendations 
and other available information to determine whether modification of 
the assessment rates are needed. Further rulemaking will be undertaken 
as necessary. The Board's 2000-2001 budget and those for subsequent 
fiscal periods will be reviewed and, as appropriate, approved by the 
Department.

The Regulatory Flexibility Act and Effects on Small Businesses

    The Agricultural Marketing Service (AMS) has considered the 
economic impact of this action on small entities and has prepared this 
final regulatory flexibility analysis. The Regulatory Flexibility Act 
(RFA) would allow AMS to certify that regulations do not have a 
significant economic impact on a substantial number of small entities. 
However, as a matter of general policy, AMS' Fruit and Vegetable 
Programs (Programs) no longer opt for such certification, but rather 
perform regulatory flexibility analyses for any rulemaking that would 
generate the interest of a significant number of small entities. 
Performing such analyses shifts

[[Page 48141]]

the Programs' efforts from determining whether regulatory flexibility 
analyses are required to the consideration of regulatory options and 
economic or regulatory impacts.
    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 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 900 producers of tart cherries in the 
production area and approximately 40 handlers subject to regulation 
under the marketing order. Small agricultural producers have been 
defined by the Small Business Administration (13 CFR 121.201) 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. The majority of tart cherry producers and handlers may be 
classified as small entities.
    This rule decreases the assessment rate established for the Board 
and collected from handlers for the 2000-2001 and subsequent fiscal 
periods cherries that are utilized in the production of tart cherry 
products other than juice, juice concentrate, or puree from $0.00225 to 
$0.0017 per pound, and the assessment rate for cherries utilized for 
juice, juice concentrate, or puree from $0.001125 to $0.00085 per 
pound. The Board unanimously recommended 2000-2001 expenditures of 
$455,000 and the reduced assessment rates. The quantity of assessable 
tart cherries for the 2000-2001 crop year is estimated at 260 million 
pounds. Assessment income, based on this crop, along with interest 
income and reserves will be adequate to cover budgeted expenses.
    The major expenditures recommended by the Board for the 2000-2001 
fiscal period include $175,000 for personnel, $120,000 for compliance, 
and $75,000 for Board meetings. Budgeted expenses for these items in 
1999-2000 were $222,780 for personnel, $100,000 for compliance, and 
$100,000 for Board meetings.
    Decreased assessment rates were recommended by the Board this year 
because the Board expects the 2000 crop to be large. In addition, the 
Board wants to reduce handler costs and wants to keep its monetary 
reserve within the authorized maximum of approximately one year's 
operational expenses as specified in Sec. 930.42(a).
    The Board discussed the alternative of continuing the existing 
assessment rates, but concluded that the Board should operate as 
efficiently as possible and the amount collected at the higher rates 
could cause the operating reserve to exceed what is actually needed. In 
deriving the recommended assessment rates, the Board estimated 
assessable tart cherry production for the crop year at 260 million 
pounds. It further estimated that about 245 million pounds of the 
assessable poundage would be utilized in the production of high-valued 
products, like frozen, canned, or dried cherries, and that about 15 
million pounds would be utilized in the production of low-valued 
products, like juice, juice concentrate, or puree. Potential assessment 
income from the high valued products would be approximately $416,500 
(245 million pounds  x  $0.0017 per pound). The potential income from 
tart cherries utilized for juice, juice concentrate, or puree would be 
$12,750 (15 million pounds  x  $0.00085 per pound). Therefore, the 
total assessment income for 2000-2001 is estimated at $429,250. This 
amount plus adequate supplies in the reserve and interest income will 
be sufficient to cover budgeted expenses. Funds in the reserve 
(currently $300,000) will be kept within the approximately one year's 
operational expenses permitted by the order (7 CFR 930.42(a)).
    This action decreases the assessment obligation imposed on 
handlers. Assessments are applied uniformly on all handlers, and some 
of the costs may be passed on to producers. However, decreasing the 
assessment rate reduces the burden on handlers, and may reduce the 
burden on producers. In addition, the Board's meeting was widely 
publicized throughout the tart cherry industry and all interested 
persons were invited to attend the meeting and participate in Board 
deliberations on all issues. Like all Board meetings, the March 2, 
2000, meeting was a public meeting and all entities, both large and 
small, were able to express views on this issue. Finally, interested 
persons were invited to submit 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 tart cherry 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 proposed rule concerning this action was published in the Federal 
Register on May 22, 2000. Copies of the rule were mailed by the Board's 
staff to all Board members and cherry handlers. In addition, the rule 
was made available through the Internet by the Office of the Federal 
Register. That rule provided a 30-day comment period which ended June 
21, 2000. No comments were received.
    A small business guide on complying with fruit, vegetable, and 
specialty crop marketing agreements and orders may be viewed at: 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 Board and other 
available information, it is hereby found that this final 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 that good 
cause exists for not postponing the effective date of this rule until 
30 days after publication in the Federal Register because the fiscal 
period began July 1, 2000, and the assessment rates apply to all 
cherries received during the 2000-2001 and subsequent fiscal periods. 
Further, handlers are aware of this rule which was recommended at a 
public meeting. Also, a 30-day comment period was provided for in the 
proposed rule.

List of Subjects in 7 CFR Part 930

    Marketing agreements, Reporting and recordkeeping requirements, 
Tart cherries.

    For the reasons set forth in the preamble, 7 CFR part 930 is 
amended as follows:

PART 930--TART CHERRIES GROWN IN THE STATES OF MICHIGAN, NEW YORK, 
PENNSYLVANIA, OREGON, UTAH, WASHINGTON, AND WISCONSIN

    1. The authority citation for 7 CFR part 930 continues to read as 
follows:

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

    2. Section 930.200 is revised to read as follows:

[[Page 48142]]

Sec. 930.200  Handler assessment rates.

    On and after July 1, 2000, the assessment rate imposed on handlers 
shall be $0.0017 per pound of cherries handled for tart cherries grown 
in the production area and utilized in the production of tart cherry 
products other than juice, juice concentrate, or puree. The assessment 
rate for juice, juice concentrate, and puree products shall be $0.00085 
per pound.

    Dated: August 1, 2000.
Robert C. Keeney,
Deputy Administrator, Fruit and Vegetable Programs.
[FR Doc. 00-19873 Filed 8-4-00; 8:45 am]
BILLING CODE 3410-02-P