[Federal Register Volume 65, Number 209 (Friday, October 27, 2000)]
[Rules and Regulations]
[Pages 64338-64340]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-27618]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 920

[Docket No. FV00-920-3 FIR]


Kiwifruit Grown in California; Decreased Assessment Rate

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 decreased 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.

EFFECTIVE DATE: November 27, 2000.

FOR FURTHER INFORMATION CONTACT: 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, 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, room 2525-S, PO 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 continues to decrease 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 had 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 previously in effect. The Committee voted to reduce 2000-
2001 budgeted expenditures and the assessment rate to lessen the 
financial burden on California kiwifruit handlers.
    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...................................      4,000      2,300
Account...........................................
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

[[Page 64339]]

rate of $.03 per container, $439 less than the estimated expenses. 
Income derived from handler assessments, along with $24,000 carry-in 
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 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 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 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 continues to decrease 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 previous rate. The quantity of assessable 
kiwifruit for the 2000-2001 fiscal period is estimated at 2,704,545 22-
pound volume fill containers or equivalent. 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 operation 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...................................      4,000      2,300
Account...........................................
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 alternative expenditure 
levels. The subcommittee looked at maintaining the assessment rate at 
its current level, but determined that the 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 carry-in 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 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 continues to decrease 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 conference call to 
be conducted on July 13, 2000. Finally, interested persons were invited 
to

[[Page 64340]]

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.
    An interim final rule concerning this action was published in the 
Federal Register on August 14, 2000 (65 FR 49472). Copies of that rule 
were also mailed or sent via facsimile to all kiwifruit handlers. 
Finally, the interim final rule was made available through the Internet 
by the Office of the Federal Register. A 60-day comment period was 
provided for interested persons to respond to the interim final rule. 
The comment period ended on October 13, 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 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.

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

    Accordingly, the interim final rule amending 7 CFR part 920 which 
was published at 65 FR 49472 on August 14, 2000, is adopted as a final 
rule without change.

    Dated: October 23, 2000.
Robert C. Keeney,
Deputy Administrator, Fruit and Vegetable Programs.
[FR Doc. 00-27618 Filed 10-26-00; 8:45 am]
BILLING CODE 3410-02-P