[Federal Register Volume 65, Number 157 (Monday, August 14, 2000)]
[Rules and Regulations]
[Pages 49472-49474]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-20490]


-----------------------------------------------------------------------

DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 920

[Docket No. FV00-920-3 IFR]


Kiwifruit Grown in California; Decreased Assessment Rate

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Interim final rule with request for comments.

-----------------------------------------------------------------------

SUMMARY: This rule decreases the assessment rate established for the 
Kiwifruit Administrative Committee (Committee) for the 2000-2001 and 
subsequent fiscal periods from $0.05 to $0.03 per 22-pound volume fill 
container or equivalent of kiwifruit. The Committee locally administers 
the marketing order which regulates the handling of kiwifruit grown in 
California. Authorization to assess kiwifruit handlers enables the 
Committee to incur expenses that are reasonable and necessary to 
administer the program. The fiscal period begins August 1 and ends July 
31. The assessment rate will remain in effect indefinitely unless 
modified, suspended, or terminated.

DATES: August 15, 2000. Comments received by October 13, 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, P.O. Box 96456, Washington, DC 20090-6456; Fax: 
(202) 205-5698, 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, or can be 
viewed at: http://www.ams.usda.gov/fv/moab.html.

FOR FURTHER INFORMATION CONTACT:

Diane Purvis, Marketing Assistant or Rose M. Aguayo, Marketing 
Specialist, California Marketing Field Office, Marketing Order 
Administration Branch, Fruit and Vegetable Programs, 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, P.O. 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, room 2525-S, P.O. Box 
96456, 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. 920, as amended (7 CFR part 920), regulating the handling of 
kiwifruit grown in California, hereinafter referred to as the 
``order.'' The marketing 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, California 
kiwifruit 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 
kiwifruit beginning August 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 fiscal periods from $0.05 to 
$0.03 per 22-pound volume fill container or equivalent of kiwifruit.
    The California kiwifruit marketing 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 California 
kiwifruit. They are familiar with the Committee's needs and 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 is normally formulated and discussed in a public 
meeting. A public meeting was held on July 11, 2000. Because a 
Committee quorum (eight Committee representatives) was not present at 
the meeting, the Committee voted on the budget and assessment rate by 
telephone on July 13, 2000. Thus, all directly affected persons were 
provided an opportunity to participate and provide input.
    For the 1998-1999 and subsequent fiscal periods, the Committee 
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 Committee or other information available 
to the Secretary.
    In the telephone conference call on July 13, 2000, the Committee 
unanimously recommended 2000-2001 expenditures of $81,575 and an 
assessment rate of $0.03 per 22-pound volume fill container or 
equivalent of kiwifruit. In comparison, last year's budgeted 
expenditures were $83,800. The assessment rate of $0.03 is $0.02 lower 
than the rate currently in effect.
    The Committee voted to reduce 2000-2001 budgeted expenditures and 
the assessment rate to lessen the financial burden on California 
kiwifruit handlers.

[[Page 49473]]

The following table compares major budget expenditures recommended by 
the Committee for the 2000-2001 and 1999-2000 fiscal periods:

------------------------------------------------------------------------
            Budget expense  categories              2000-2001  1999-2000
------------------------------------------------------------------------
Administrative Staff & Field Salaries.............     52,000     56,000
Travel, Food & Lodging............................      9,500      7,500
Office Costs......................................     12,000     14,000
Vehicle Expense Account...........................      4,000      2,300
Annual Audit......................................      4,075      4,000
------------------------------------------------------------------------

    The assessment rate recommended by the Committee was derived by 
considering the amount of funds in the Committee's operating reserve, 
anticipated expenses, and expected shipments of California kiwifruit. 
Kiwifruit shipments for the year are estimated at 2,704,545 22-pound 
volume fill containers or equivalents of kiwifruit, which should 
provide $81,136 in assessment income at an assessment rate of $.03 per 
container, $439 less than the estimated expenses. Income derived from 
handler assessments, along with $24,000 from the Committee's operating 
reserve, will be adequate to meet budgeted expenses and to establish an 
adequate reserve (estimated to be $23,561 at the end of the 2000-2001 
fiscal period). Reserve funds will be kept within 1 fiscal period's 
expenses, the maximum permitted under Sec. 920.42 of the order.
    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 
fiscal period 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 
fiscal periods 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, 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 approximately 400 producers of kiwifruit in the 
production area and approximately 56 handlers subject to regulation 
under the marketing order. Small agricultural producers are 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.
    None of the 56 handlers subject to regulation have annual kiwifruit 
sales of at least $5,000,000, excluding receipts from any other 
sources. Ten of the 400 producers subject to regulation have annual 
sales of at least $500,000; and the remaining 390 producers have sales 
less than $500,000, excluding receipts from any other sources. The 
majority of California kiwifruit producers and handlers may 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 
fiscal periods from $0.05 to $0.03 per 22-pound volume fill container 
or equivalent. The Committee unanimously recommended 2000-2001 
expenditures of $81,575 and an assessment rate of $0.03 per 22-pound 
volume fill container or equivalent. The assessment rate of $0.03 is 
$0.02 lower than the current rate. The quantity of assessable kiwifruit 
for the 2000-2001 fiscal period is estimated at 2,704,545 22-pound 
volume fill containers or equivalents. Thus, the $0.03 rate should 
provide $81,136 in assessment income, $439 less than the estimated 
expenses.
    The estimated assessments of $81,136, combined with the $24,000 
from the Committee's operating reserve will allow the Committee to meet 
its expenses and to establish an adequate reserve (estimated to be 
$23,561 at the end of the 2000-2001 fiscal period). Reserve funds will 
be kept within 1 fiscal period's expenses, the maximum permitted under 
Sec. 920.42 of the order.
    The following table compares major budget expenditures recommended 
by the Committee for the 2000-2001 and 1999-2000 fiscal years:

------------------------------------------------------------------------
            Budget expense  categories              2000-2001  1999-2000
------------------------------------------------------------------------
Administrative Staff & Field Salaries.............     52,000     56,000
Travel, Food & Lodging............................      9,500      7,500
Office Costs......................................     12,000     14,000
Vehicle Expense Account...........................      4,000      2,300
Annual Audit......................................      4,075      4,000
------------------------------------------------------------------------

    The Committee reviewed and unanimously recommended 2000-2001 
expenditures of $81,575 which includes decreases in Administrative 
Staff and Field Salaries, and office costs. The Committee also 
unanimously recommended lowering the assessment rate from $0.05 to 
$0.03 to lessen the financial burden on handlers.
    Prior to arriving at this budget, the Committee considered 
information from various sources, such as the Committee's Finance and 
Assessment Subcommittee. These groups discussed alternate expenditure 
levels. The subcommittee looked at maintaining the assessment rate at 
its current level, but determined that handler financial burden should 
be lessened. The assessment rate of $0.03 per 22-pound volume fill 
container or equivalent of assessable kiwifruit was recommended by the 
Committee and was derived by considering the funds in the Committee's 
operating reserve, anticipated expenses, and expected shipments of 
California kiwifruit.
    Kiwifruit shipments for the year are estimated at 2,704,545 22-
pound volume fill containers or equivalents of kiwifruit, which should 
provide $81,136 in assessment income, $439 less than the estimated 
expenses. Income derived from handler assessments, along with the 
$24,000 from the Committee's operating reserve, will be adequate to 
meet budgeted expenses and to establish an adequate reserve (estimated 
to be $23,561 at the end of the 2000-2001 fiscal period). Reserve funds 
will be kept within 1 fiscal period's expenses, the maximum permitted 
under Sec. 920.42 of the order.
    A review of historical information and preliminary information 
pertaining to the upcoming fiscal period indicates that the grower 
price for the 2000-2001 season will be approximately $12.32 per 22-
pound volume fill container or

[[Page 49474]]

equivalent of kiwifruit. Therefore, the estimated assessment revenue 
for the 2000-2001 fiscal period as a percentage of total grower revenue 
is estimated at 0.2 percent.
    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 Committee's July 11, 2000, meeting was widely 
publicized throughout the California kiwifruit industry and all 
interested persons were invited to attend the meeting and participate 
in Committee deliberations on all issues. Like all Committee meetings, 
the July 11, 2000, meeting was a public meeting and all entities, both 
large and small, were able to express views on this issue.
    Additionally, all attendees were advised of the telephone 
conference call to be conducted on July 13, 2000. Finally, interested 
persons are 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 California kiwifruit 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: 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, and that good cause exists for not postponing the effective 
date of this rule until 30 days after publication in the Federal 
Register because: (1) The 2000-2001 fiscal period begins on August 1, 
2000, and the marketing order requires that the rate of assessment for 
each fiscal period apply to all assessable kiwifruit handled during 
such fiscal period; (2) this action decreases the assessment rate for 
assessable kiwifruit beginning with the 2000-2001 fiscal period; (3) 
handlers are aware of this action which was unanimously recommended by 
the Committee during a telephone conference 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.

List of Subjects in 7 CFR Part 920

    Kiwifruit, Marketing agreements.

    For the reasons set forth in the preamble, 7 CFR part 920 is 
amended as follows:

PART 920--KIWIFRUIT GROWN IN CALIFORNIA

    1. The authority citation for 7 CFR part 920 continues to read as 
follows:

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

    2. Section 920.213 is revised to read as follows:


Sec. 920.213  Assessment rate.

    On and after August 1, 2000, an assessment rate of $0.03 per 22-
pound volume fill container or equivalent is established for kiwifruit 
grown in California.

    Dated: August 8, 2000.
Robert C. Keeney,
Deputy Administrator, Fruit and Vegetable Programs.
[FR Doc. 00-20490 Filed 8-11-00; 8:45 am]
BILLING CODE 3410-02-P