[Federal Register Volume 67, Number 51 (Friday, March 15, 2002)]
[Proposed Rules]
[Pages 11614-11616]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-6139]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 915

[Docket No. FV02-915-2 PR]


Avocados Grown in South Florida; Increased Assessment Rate

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule.

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SUMMARY: This rule would increase the assessment rate established for 
the Avocado Administrative Committee (Committee) for the 2002-03 and 
subsequent fiscal periods from $0.19 per 55-pound bushel container or 
equivalent to $0.20 per 55-pound bushel container or equivalent of 
avocados handled. The Committee locally administers the marketing order 
which regulates the handling of avocados grown in South Florida. 
Authorization to assess avocado handlers enables the Committee to incur 
expenses that are reasonable and necessary to administer the program. 
The fiscal period begins April 1 and ends March 31. The assessment rate 
would remain in effect indefinitely unless modified, suspended, or 
terminated.

DATES: Comments must be received by April 15, 2002.

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: Doris Jamieson, Marketing Specialist, 
Southeast Marketing Field Office, Fruit and Vegetable Programs, AMS, 
USDA, 799 Overlook Drive, Suite A, Winter Haven, Florida 33884: 
telephone: (863) 324-3375, Fax: (863) 325-8793; 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. 121 and Order No. 915, both as amended (7 CFR part 915), 
regulating the handling of avocados grown in South Florida, 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, Florida 
avocado handlers are subject to assessments. Funds to administer the 
order are derived from such assessments. It is intended that the 
assessment rate as proposed herein would be applicable to all 
assessable avocados beginning on April 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 would increase the assessment rate established for the 
Committee for the 2002-03 and subsequent fiscal periods from $0.19 per 
55-pound bushel container or

[[Page 11615]]

equivalent to $0.20 per 55-pound bushel container or equivalent of 
avocados.
    The Florida avocado 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 
Florida avocados. 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 2000-01 and subsequent fiscal periods, the Committee 
recommended, and USDA approved, an assessment rate that would continue 
in effect from fiscal period to fiscal period 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 January 9, 2002, and unanimously recommended 
2002-03 expenditures of $211,082 and an assessment rate of $0.20 per 
55-pound bushel container or equivalent of avocados. In comparison, 
last year's budgeted expenditures were $187,384. The assessment rate of 
$0.20 is $0.01 higher than the rate currently in effect.
    The Florida Lime Administrative Committee and the Avocado 
Administrative Committee have shared certain costs (staff, office 
space, and equipment) for economy and efficiency. Each Committee's 
share of these costs was based upon the amount of work and time devoted 
to their particular programs. In April 2001, the Lime Administrative 
Committee voted to suspend its regulations, including assessment 
collection. They will not need an administrative staff, office space, 
or equipment during the suspension period. Therefore, the Avocado 
Administrative Committee must assume increased costs. The increased 
assessment is needed to generate more assessment funds to cover the 
increased expenses, and to reduce the amount of reserve funds the 
avocado committee would have to use to pay those expenses. Without the 
assessment rate increase, the avocado committee would have to use 
$26,582 of its operating reserve to cover the estimated expenses. With 
the increase, the avocado committee would only have to use $17,082 of 
its operating reserve to cover expenses.
    The major expenditures recommended by the Committee for the 2002-03 
year include $76,800 for salaries, $39,850 for local & national 
enforcement, $20,000 for research, $19,499 for insurance and bonds, and 
$17,958 for employee benefits. Budgeted expenses for these items in 
2001-02 were $60,000, $45,615, $17,000, $14,336, and $15,180, 
respectively.
    The assessment rate recommended by the Committee was derived by 
dividing anticipated expense by expected shipments of Florida avocados. 
Avocado shipments for the year are estimated at 950,000 bushels which 
should provide $190,000 in assessment income. Income derived from 
handler assessments, along with interest income and funds from the 
Committee's authorized reserve, would be adequate to cover budgeted 
expenses. Funds in the reserve (currently $96,633) would be kept within 
the maximum permitted by the order (approximately three fiscal periods' 
expenses).
    The proposed assessment rate would 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 would be in effect for an indefinite 
period, the Committee would 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 USDA. 
Committee meetings are open to the public and interested persons may 
express their views at these meetings. USDA would evaluate Committee 
recommendations and other available information to determine whether 
modification of the assessment rate is needed. Further rulemaking would 
be undertaken as necessary. The Committee's 2002-03 budget and those 
for subsequent fiscal periods would 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 150 producers or avocados in the production 
area and approximately 33 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.
    According to the Florida Agricultural Statistics Service, the 
average f.o.b. price for fresh avocados during the 2000-01 season was 
$14.60 per 55-pound bushel container or equivalent for all domestic 
shipments and total shipments were 1,005,000 bushels. Using these 
prices, virtually all avocado handlers could be considered small 
businesses under the SBA definition. The majority of Florida avocado 
handlers and producers may be classified as small entities.
    This rule would increase the assessment rate established for the 
Committee and collected from handlers for the 2002-03 and subsequent 
fiscal periods from $0.19 per 55-pound bushel container or equivalent 
to $0.20 per 55-pound bushel container or equivalent of avocados. The 
Committee unanimously recommended 2002-03 expenditures of $211,082 and 
an assessment rate of $0.20 per 55-pound bushel container. The proposed 
assessment rate of $0.20 is $0.01 higher than the 2001-02 rate. The 
quantity of assessable avocados for the 2002-03 season is estimated at 
950,000. Thus, the $0.20 rate should provide $190,000 in assessment 
income. Income derived from handler assessments, along with interest 
income and funds from the Committee's authorized reserve, would be 
adequate to cover budgeted expenses.
    The major expenditures recommended by the Committee for the 2002-03 
fiscal year include $76,800 for salaries, $39,850 for local & national 
enforcement, $20,000 for research, $19,499 for insurance and bonds, and 
$17,958 for employee benefits. Budgeted expenses for these items in 
2001-02 were $60,000, $45,615, $17,000, $14,336, and $15,180, 
respectively.
    The Florida Lime Administrative Committee and the Avocado 
Administrative Committee shared certain costs (staff, office space, and 
equipment) for economy and efficiency. Each Committee's share of these 
costs

[[Page 11616]]

was based upon the amount of work and time devoted to their particular 
programs. In April 2001, the Lime Administrative Committee voted to 
suspend its regulations, including assessment collection. They will not 
need an administrative staff, office space, or equipment during the 
suspension period. Therefore, the Avocado Administrative Committee must 
assume increased costs. The increased assessment is needed to cover the 
increased costs and to keep its operating reserve at an acceptable 
level.
    The Committee reviewed and unanimously recommended 2002-03 
expenditures of $211,082 which included increases in administrative and 
office salaries, and research programs. Prior to arriving at this 
budget, the Committee considered information from various sources, such 
as the Committee's Budget Subcommittee. These groups discussed 
alternative expenditure levels. The assessment rate of $0.20 per 55-
pound bushel container of assessable avocados was then determined by 
dividing the total recommended budget by the quantity of assessable 
avocados, estimated at 950,000 55-pound bushel containers or 
equivalents for the 2002-03 fiscal year. This is approximately $21,000 
below the anticipated expenses, which the Committee determined to be 
acceptable.
    A review of historical information and preliminary information 
pertaining to the upcoming fiscal year indicates that the average 
grower price for the 2002-03 season could range between $10.00 and 
$60.00 per 55-pound bushel container or equivalent of avocados. 
Therefore, the estimated assessment revenue fro the 2002-03 fiscal year 
as a percentage of total grower revenue could range between .3 and 2 
percent.
    This action would increase the assessment obligation imposed on 
handlers. While assessments impose some additional costs on handlers, 
the costs are minimal and uniform on all handlers. Some of the 
additional costs may be passed on to producers. However, these costs 
would be offset by the benefits derived by the operation of the 
marketing order. In addition, the Committee's meeting was widely 
publicized throughout the Florida avocado industry and all interested 
persons were invited to attend the meeting and participate in Committee 
deliberations on all issues. Like all Committee meetings, the January 
9, 2002, 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 proposed rule would impose no additional reporting or 
recordkeeping requirements on either small or large Florida avocado 
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.
    A 30-day comment period is provided to allow interested persons to 
respond to this proposed rule. Thirty days is deemed appropriate 
because: (1) The 2002-03 fiscal period begins on April 1, 2002, and the 
marketing order requires that the rate of assessment for each fiscal 
period apply to all assessable avocados handled during such fiscal 
period; (2) the Committee needs to have sufficient funds to pay its 
expenses which are incurred on a continuous basis; and (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 year.

List of Subjects in 7 CFR Part 915

    Avocados, Marketing agreements, Reporting and recordkeeping 
requirements.
    For the reasons set forth in the preamble, 7 CFR part 915 is 
proposed to be amended as follows:

PART 915--AVOCADOS GROWN IN SOUTH FLORIDA

    1. The authority citation for 7 CFR part 915 continues to read as 
follows:

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

    2. Section 915.235 is revised to read as follows:


Sec. 915.235  Assessment rate.

    On and after April 1, 2002, an assessment rate of $0.20 per 55-
pound container or equivalent is established for avocados grown in 
South Florida.

    Dated: March 11, 2002.
A.J. Yates,
Administrator, Agricultural Marketing Service.
[FR Doc. 02-6139 Filed 3-14-02; 8:45 am]
BILLING CODE 3410-02-M