[Federal Register Volume 66, Number 109 (Wednesday, June 6, 2001)]
[Rules and Regulations]
[Pages 30289-30291]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-14270]



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  Federal Register / Vol. 66, No. 109 / Wednesday, June 6, 2001 / Rules 
and Regulations  

[[Page 30289]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 932

[Docket No. FV01-932-1 FIR]


Olives Grown in California; Increased Assessment Rate

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

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

SUMMARY: The Department of Agriculture (Department) is adopting, as a 
final rule, without change, the provisions of an interim final rule 
which increased the assessment rate established for the California 
Olive Committee (Committee) for the 2001 and subsequent fiscal years 
from $21.73 to $27.90 per ton of olives handled. The Committee locally 
administers the marketing order which regulates the handling of olives 
grown in California. Authorization to assess olive handlers enables the 
Committee to incur expenses that are reasonable and necessary to 
administer the program. The fiscal year began January 1 and ends 
December 31. The assessment rate will remain in effect indefinitely 
unless modified, suspended, or terminated.

EFFECTIVE DATE: July 6, 2001.

FOR FURTHER INFORMATION CONTACT: Rose 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) 720-8938.
    Small businesses may request information on complying with this 
regulation 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) 
720-8938, or E-mail: [email protected].

SUPPLEMENTARY INFORMATION: This rule is issued under Marketing 
Agreement No. 148 and 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 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 
olive 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 
olives beginning on January 1, 2001, 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 increase the assessment rate established for 
the Committee for the 2001 and subsequent fiscal years from $21.73 per 
ton to $27.90 per ton of olives handled.
    The California olive 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 and handlers of 
California olives. 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 2000 and subsequent fiscal years, the Committee 
recommended, and the Department approved, an assessment rate that would 
continue in effect from fiscal year to fiscal 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 December 12, 2000, and unanimously recommended 
fiscal year 2001 expenditures of $1,348,242 and an assessment rate of 
$27.90 per ton of olives. In comparison, last year's budgeted 
expenditures were $2,472,235 and the assessment rate was $21.73. 
Assessable tonnage for 2001 was estimated at 46,374, significantly 
below last year's 113,750 tons. Although the Committee reduced 
expenditures in marketing development and research, the significant 
decrease in tonnage necessitates a higher assessment rate. The reduced 
research expenditures will fund: (1) Continued research and development 
of the mechanical olive harvester and (2) scientific studies to develop 
chemical and scientific defenses to counteract a potential threat from 
the olive fruit fly in the California production area. Market 
development expenditures are significantly lower because handlers have 
taken more responsibility for market development.
    The following table compares major budget expenditure 
recommendations for the 2001 fiscal year with those from last year.

[[Page 30290]]



------------------------------------------------------------------------
              Budget expenditure                    2000         2001
------------------------------------------------------------------------
Administration................................     $356,190     $343,490
                  Research....................      868,550      408,337
Market Development............................    1,212,495      596,415
------------------------------------------------------------------------

    The assessment rate recommended by the Committee was derived by 
considering anticipated expenses, actual tonnage, and additional 
pertinent factors. The significant tonnage decrease in 2001, due in 
large part to the alternate-bearing nature of olives, has made it 
necessary for the Committee to increase the assessment rate from $21.73 
to $27.90 per ton, an increase of $6.17. Income derived from handler 
assessments, interest, and reserve funds will be adequate to cover 
budgeted expenses. Funds in the reserve will continue to be less than 
the maximum permitted by Sec. 932.40 of the order (approximately one 
fiscal year's expenses) by the end of 2001.
    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 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 
2001 budget and those for subsequent fiscal years will be reviewed and, 
as appropriate, approved by the Department.

Final Regulatory Flexibility Analysis

    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 1,200 producers of olives in the production 
area and 2 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 olive 
handlers may be classified as small entities, while the majority of 
olive producers may be classified as small entities.
    This rule continues to increase the assessment rate established for 
the Committee and collected from handlers for the 2001 and subsequent 
fiscal years from $21.73 per ton to $27.90 per ton of olives. The 
Committee unanimously recommended 2001 expenditures of $1,348,242 and 
an assessment rate of $27.90 per ton. The assessment rate of $27.90 is 
$6.17 higher than the 2000 rate. The estimated quantity of assessable 
olives for the 2001 fiscal year is 46,374 tons. Thus, the $27.90 rate 
should generate enough funds to meet this year's budgeted expenses, 
when combined with funds from the authorized reserve and interest 
income.
    The following table compares major budget expenditure 
recommendations for the 2001 fiscal year with those from last year.

------------------------------------------------------------------------
              Budget expenditure                    2000         2001
------------------------------------------------------------------------
Administration................................     $356,190     $343,490
Research......................................      868,550      408,337
Market Development............................    1,212,495      596,415
------------------------------------------------------------------------

    The reduced research expenditures will fund: 1) Continued research 
and development of the mechanical olive harvester and 2) scientific 
studies to develop chemical and scientific defenses to counteract a 
potential threat from the olive fruit fly in the California production 
area. Market development expenditures are significantly lower because 
handlers have taken more responsibility for market development.
    A higher assessment rate was recommended for 2001 because the 2001 
fiscal year assessable tonnage is approximately 59 percent smaller than 
last fiscal year's tonnage, due in large part to the alternate bearing 
nature of the crop:

------------------------------------------------------------------------
                     1999                           2000         2001
------------------------------------------------------------------------
67,900........................................      113,750       46,374
------------------------------------------------------------------------

    The Committee reviewed and unanimously recommended 2001 
expenditures of $1,348,242, which reflects decreases in the research, 
market development and administrative budgets. Prior to arriving at 
this budget, the Committee considered information from various sources, 
such as the Committee's Executive Subcommittee, the Research 
Subcommittee, and the Marketing Subcommittee. Alternate spending levels 
were discussed by these groups, based upon potential reductions in the 
funding of various research and market development projects. The 
Committee determined it was necessary to increase the assessment rate 
to cover these expenses because the significant decrease in tonnage 
will not provide sufficient funds to cover anticipated expenses. The 
assessment rate of $27.90 per ton of assessable olives was derived by 
considering anticipated expenses, the Committee's estimate of 
assessable olives, and additional pertinent factors.
    A review of historical and preliminary information pertaining to 
the upcoming fiscal year indicates that the grower revenue for the 
2000-2001 crop year is estimated to be approximately $36,068,864. With 
an assessment rate of $27.90 per ton, the estimated assessment revenue 
to the Committee will be $1,293,834 for the 2001 fiscal year, or 
approximately 3.59 percent of grower revenue.
    This action continues to increase the assessment obligation imposed 
on handlers for fiscal year 2001 by $286,128 ($6.17 difference between 
the new and past rate x 46,374 assessable tonnage estimate for 2001). 
Assessments are applied uniformly on all handlers, and some of the 
costs may be passed on to producers. However, increasing the assessment 
rate increases the burden on handlers, and may increase the burden on 
producers. In addition, the Committee's meeting was widely publicized 
throughout the California olive industry and all interested persons 
were invited to attend the meeting and participate in Committee 
deliberations on all issues. Like all Committee meetings, the December 
12, 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 California olive handlers. As with all

[[Page 30291]]

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 March 6, 2001 (66 FR 13389). Copies of that rule 
were also mailed or sent via facsimile to all olive 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 May 7, 2001, and 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 932

    Marketing agreements, Olives, Reporting and recordkeeping 
requirements.

PART 932--OLIVES GROWN IN CALIFORNIA

    Accordingly, the interim final rule amending 7 CFR part 932 which 
was published at 66 FR 13389 on March 6, 2001, is adopted as a final 
rule without change.

    Dated: June 1, 2001.
Kenneth C. Clayton,
Acting Administrator, Agricultural Marketing Service.
[FR Doc. 01-14270 Filed 6-5-01; 8:45 am]
BILLING CODE 3410-02-P