[Federal Register Volume 67, Number 25 (Wednesday, February 6, 2002)]
[Rules and Regulations]
[Pages 5438-5440]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-2847]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 932

[Docket No. FV02-932-1 IFR]


Olives Grown in California; 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 
California Olive Committee (Committee) for the 2002 and subsequent 
fiscal years from $27.90 to $10.09 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, 2002, and ends December 31, 2002. The assessment rate will remain in 
effect indefinitely unless modified, suspended, or terminated.

DATES: Effective: February 7, 2002. Comments received by April 8, 2002, 
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, 1400 Independence Avenue, SW STOP 0237, Washington, DC 
20250-0237; Fax: (202) 720-8938, 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: 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, 1400 
Independence Avenue, SW STOP 0237, Washington, DC 20250-0237; 
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, 1400 Independence 
Avenue, SW STOP 0237, Washington, DC 20250-0237; 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 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 (USDA) 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 January 1, 2002, 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 USDA 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 USDA 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 USDA'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 2002 and subsequent fiscal years from $27.90 per ton 
to $10.09 per ton of olives.
    The California olive marketing order provides authority for the 
Committee, with the approval of USDA, 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 2001 and subsequent fiscal years, the Committee 
recommended, and USDA approved, an assessment rate that would continue 
in effect from fiscal year to fiscal year unless modified, suspended, 
or terminated by USDA upon recommendation and information submitted by 
the Committee or other information available to USDA.
    The Committee met on December 11, 2001, and unanimously recommended 
fiscal year 2002 expenditures of $1,428,585 and an assessment rate of 
$10.09 per ton of olives. In comparison, last year's budgeted 
expenditures were $1,348,242 and the assessment rate was $27.90. The 
assessment rate of $10.09 is

[[Page 5439]]

$17.81 lower than the rate currently in effect.
    Expenditures recommended by the Committee for the 2002 fiscal year 
include $811,935 for marketing development, $339,650 for 
administration, $250,000 for research, and $27,000 for capital 
expenditures. Budgeted expenses for these items in 2001 were $596,415, 
$343,490, $408,337, and $0, respectively.
    Last year's assessable tonnage was 46,374 tons, and this year's 
assessable tonnage is 123,439 tons. Although the Committee increased 
2002 marketing development and capital expenditures, the significant 
increase in assessable tonnage makes possible the lower assessment 
rate.
    Funds budgeted for research activities are reduced due to 
completion of the mechanical harvester project. The reduced research 
expenditures will fund 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 higher as the Committee's website will 
be redesigned and outreach programs will be implemented for students 
and teachers. Capital expenditures are higher as the Committee will 
purchase a vehicle for Committee staff.
    The assessment rate recommended by the Committee was derived by 
considering anticipated expenses, actual tonnage, and additional 
pertinent factors. As mentioned earlier olive shipments for the year 
are estimated at 123,439 for fiscal year 2002. This compares to an 
assessable tonnage of 46,374 for fiscal year 2001. The significant 
tonnage increase in fiscal year 2002, due in part to the alternate-
bearing nature of olives, has made it possible for the Committee to 
decrease the assessment rate from $27.90 to $10.09 per ton. Income 
derived from handler assessments, along with interest income and funds 
from the Committee's authorized reserve, will be adequate to cover 
budgeted expenses. Funds in the reserve will be kept within the maximum 
permitted by the order--approximately one fiscal periods' expenses, or 
$1,428,585 (Sec. 932.40).
    The assessment rate established in this rule will continue in 
effect indefinitely unless modified, suspended, or terminated by USDA 
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 USDA. 
Committee meetings are open to the public and interested persons may 
express their views at these meetings. USDA 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 2002 budget and those for 
subsequent fiscal years will be reviewed and, as appropriate, approved 
by USDA.

Initial 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 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 1,200 producers of olives in the production 
area and approximately 3 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 $750,000, and small agricultural service firms are 
defined as those whose annual receipts are less than $5,000,000.
    The majority of olive producers may be classified as small 
entities. One of the handlers may be classified as a small entity. 
Thus, the majority of handlers may be classified as large entities.
    This rule decreases the assessment rate established for the 
Committee and collected from handlers for the 2002 and subsequent 
fiscal years from $27.90 to $10.09 per ton of olives. The Committee 
unanimously recommended 2002 expenditures of $1,428,585 and an 
assessment rate of $10.09 per ton. The assessment rate of $10.09 is 
$17.81 lower than the 2001 rate. The quantity of assessable olives for 
the 2002 fiscal year is estimated at 123,439 tons. Thus, the $10.09 
rate should provide $1,245,500 in assessment income and should be 
adequate, when combined with funds from the authorized reserve and 
interest income to meet this year's expenses.
    The expenditures recommended by the Committee for the 2002 fiscal 
year include $811,935 for marketing development, $339,650 for 
administration, $250,000 for research, and $27,000 for capital 
expenditures. Budgeted expenses for these items in 2001 were $596,415, 
$343,490, $408,337, and $0, respectively.
    Last year's assessable tonnage was 46,374 tons, and this year's 
assessable tonnage is 123,439 tons. Although the Committee increased 
2002 marketing development and capital expenditures, the significant 
increase in tonnage makes the lower assessment rate possible.
    Funds budgeted for research activities are reduced due to 
completion of the mechanical harvester project. The reduced research 
expenditures will fund 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 higher as the Committee's website will 
be redesigned and outreach programs will be implemented for students 
and teachers. Capital expenditures are higher as the Committee will 
purchase a vehicle for Committee staff.
    Prior to arriving at this budget, the Committee considered 
information from various sources, such as the Committee's Executive 
Subcommittee, and Market Development Subcommittee. Alternative 
expenditure levels were discussed by these groups, based upon the 
relative value of various research and marketing projects to the olive 
industry. The assessment rate of $10.09 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 information and preliminary information 
pertaining to the upcoming fiscal year indicates that the grower price 
for the 2002 season is estimated to be approximately $502.27 per ton of 
olives. Therefore, the estimated assessment revenue for the 2002 fiscal 
year as a percentage of total grower revenue will be approximately 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

[[Page 5440]]

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 11, 2001, 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 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 olive 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.
    USDA 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 2002 fiscal year began on January 1, 2002, 
and the marketing order requires that the rate of assessment for each 
fiscal year apply to all assessable olives handled during such fiscal 
year; (2) the action decreases the assessment rate for assessable 
olives beginning with the 2002 fiscal 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.

List of Subjects in 7 CFR Part 932

    Marketing agreements, Olives, Reporting and recordkeeping 
requirements.

    For the reasons set forth in the preamble, 7 CFR part 932 is 
amended as follows:

PART 932--OLIVES GROWN IN CALIFORNIA

    1. The authority citation for 7 CFR part 932 continues to read as 
follows:

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


    2. Section 932.230 is revised to read as follows:


Sec. 932.230  Assessment rate.

    On and after January, 1, 2002, an assessment rate of $10.09 per ton 
is established for California olives.

    Dated: January 31, 2002.
A.J. Yates,
Administrator, Agricultural Marketing Service.
[FR Doc. 02-2847 Filed 2-5-02; 8:45 am]
BILLING CODE 3410-02-P