[Federal Register Volume 67, Number 64 (Wednesday, April 3, 2002)]
[Proposed Rules]
[Pages 15747-15753]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-7918]


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 Proposed Rules
                                                 Federal Register
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 This section of the FEDERAL REGISTER contains notices to the public of 
 the proposed issuance of rules and regulations. The purpose of these 
 notices is to give interested persons an opportunity to participate in 
 the rule making prior to the adoption of the final rules.
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  Federal Register / Vol. 67, No. 64 / Wednesday, April 3, 2002 / 
Proposed Rules  

[[Page 15747]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 927

[Docket No. FV00-927-3]


Winter Pears Grown in Oregon and Washington; Recommended Decision 
and Opportunity To File Written Exceptions to Proposed Amendment of 
Marketing Agreement and Order No. 927

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule and opportunity to file exceptions.

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SUMMARY: This recommended decision invites written exceptions on 
proposed amendments to the marketing agreement and order for winter 
pears grown in Oregon and Washington (order). The amendments are based 
on those proposed by the Winter Pear Control Committee (Committee), 
which is responsible for local administration of the order. The 
amendments include: authorizing the Committee to recommend maturity 
regulations; authorizing the Committee to recommend container or 
marking requirements; and changing provisions related to alternate 
Committee members serving for absent members at Committee meetings. The 
proposed amendments are intended to improve the operation and 
functioning of the winter pear marketing order program.

DATES: Written exceptions must be filed by May 3, 2002.

ADDRESSES: Written exceptions should be filed with the Hearing Clerk, 
U.S. Department of Agriculture, room 1081-S, Washington, DC 20250-9200, 
Facsimile number (202) 720-9776. Four copies of all written exceptions 
should be submitted and they should reference the docket number and the 
date and page number of this issue of the Federal Register. Exceptions 
will be made available for public inspection in the Office of the 
Hearing Clerk during regular business hours, or can be viewed at: 
http://www.ams.usda.gov/fv/moab.html.

FOR FURTHER INFORMATION CONTACT: Melissa Schmaedick, Marketing 
Specialist, Marketing Order Administration Branch, Fruit and Vegetable 
Programs, AMS, USDA, 1400 Independence Avenue, Stop 0237, room 2522-S, 
Washington, DC 20250-0237; telephone: (202) 720-2491, or Fax: (202) 
720-8938. Small businesses may request information on compliance with 
this proposed regulation by contacting Jay Guerber, Marketing Order 
Administration Branch, Fruit and Vegetable Programs, AMS, USDA, 1400 
Independence Avenue, Stop 0237, room 2525-S, Washington, DC 20250-0237; 
telephone (202) 720-2491; Fax (202) 720-8938, or E-mail: 
[email protected].

SUPPLEMENTARY INFORMATION: Prior documents in this proceeding: Notice 
of Hearing issued on November 2, 2000, and published in the November 8, 
2000, issue of the Federal Register (65 FR 66935).
    This administrative action is governed by the provisions of 
sections 556 and 557 of Title 5 of the United States Code and, 
therefore, is excluded from the requirements of Executive Order 12866.

Preliminary Statement

    Notice is hereby given of the filing with the Hearing Clerk of this 
recommended decision with respect to the proposed amendment of 
Marketing Agreement and Order No. 927 regulating the handling of winter 
pears grown in Oregon and Washington, and the opportunity to file 
written exceptions thereto. Copies of this decision can be obtained 
from Melissa Schmaedick whose address is listed above.
    This action is issued pursuant to the provisions of the 
Agricultural Marketing Agreement Act of 1937, as amended (7 U.S.C. 601 
et seq.), hereinafter referred to as the ``Act,'' and the applicable 
rules of practice and procedure governing the formulation of marketing 
agreements and orders (7 CFR Part 900).
    The proposed amendments of the order are based on the record of a 
public hearing held in Portland, Oregon, on November 29, 2000. Notice 
of this hearing was published in the Federal Register on November 8, 
2000. The notice of hearing contained proposals submitted by the 
Committee and AMS.
    The Committee's proposed amendments included: Authorizing the 
Committee to recommend maturity regulations; authorizing the Committee 
to recommend container and marking requirements; and changing 
provisions related to alternate Committee members serving for absent 
members at Committee meetings.
    The Fruit and Vegetable Programs of AMS proposed to allow such 
changes as may be necessary to the order, if any of the proposed 
changes are adopted, so that all of the order's provisions conform with 
the effectuated amendments.
    Seven witnesses testified at the hearing. These witnesses 
represented winter pear growers and handlers throughout the production 
area. All witnesses supported the Committee's recommended changes. Most 
witnesses addressed the need for maturity requirements and the 
perceived impact those requirements could have on market returns. 
Witnesses also spoke to the need for the Committee to have container 
and marking regulatory authority, and the effect uniform regulations 
would have on marketing practices and costs of production. In 
conjunction with this proposed amendment, it was put forth by witnesses 
at the hearing that definitions for pack and container be added to the 
order's list of definitions. Another amendment that was supported at 
the hearing was the proposal to allow additional alternates to serve at 
Committee meetings when both a member and his or her alternates are 
unable to attend.
    At the conclusion of the hearing, the Administrative Law Judge 
fixed January 12, 2001, as the final date for interested persons to 
file proposed findings and conclusions or written arguments and briefs 
based on the evidence received at the hearing. None were filed.

Material Issues

    The material issues of record addressed in this decision are as 
follows:
    (1) Whether to add ``maturity'' to the list of attributes that may 
be regulated under the order;
    (2) Whether to add authority to the order to allow the Committee to 
recommend container and marking requirements; and
    (3) Whether to amend the order to authorize additional alternates 
to serve

[[Page 15748]]

in the place of absent Committee members.

Findings and Conclusions

    The following findings and conclusions on the material issues are 
based on evidence presented at the hearing and the record thereof.

Material Issue Number 1: The Authority To Recommend Maturity Regulation

    The order should be amended to include maturity among the 
characteristics of winter pears which may be regulated by USDA based on 
recommendation of the Committee.
    The order currently provides for regulation to limit the grade, 
size, quality or combination thereof, of any variety of pears grown in 
the production area. Whenever such regulations are in effect, pears are 
required to be inspected and certified as meeting those requirements as 
provided in Sec. 927.60 of the order. The Committee proposes adding 
specific authority to set maturity regulations.
    According to testimony given during the hearing, ``maturity'', as 
it is commonly used in the winter pear industry, describes a 
characteristic or phase of senescence in the cycle of a pear when it 
reaches its ideal time for harvest based primarily upon a pressure 
index. Testing for maturity can be accomplished through the use of 
pressure testing devices and inspection.
    In the winter pear industry, maturity is a characteristic, and 
partial consideration, in determining the ripening ability of the 
fruit. Ripeness is not a precursor criteria for maturity. Rather, 
adequate maturity in terms of the growth process of the pear is a 
necessary element to the successful ripening of the fruit after 
harvest. One witness during the hearing described the relationship 
between maturity and ripeness by explaining immaturity, which can be 
detected by a high pressure test result, results in a pear's inability 
to ripen after harvest. A maturity test would indicate whether a pear 
is fully mature at the time of harvest, therefore also indicating the 
pear's ability to ripen after harvest and in the hands of the consumer.
    Maturity of pears is tracked throughout the season through pressure 
indices. As pressure indices reduce from their initial harvest level to 
lower pressures, pears approach that stage of senescence known as 
maturity. Maturity indices are used to harvest winter pear varieties at 
the optimum time that accommodates eventual ripening, as well as long-
term cold storage and full season marketability. Because of differences 
in varietal growing patterns, maturity criteria would most likely vary 
by variety.
    While the current method for measuring maturity is via pressure 
test, witnesses testifying understood that, by adding the authority to 
define maturity regulations, testing methods would be allowed to evolve 
with advances in industry technology. As one witness stated, the 
authority to regulate maturity would give the Committee not only the 
ability to set maturity regulations based on current research, but to 
update and revise those regulations as maturity testing methods evolve 
over time.
    According to record testimony, the proposed amendment to add 
maturity to the list of regulated attributes would allow the Committee 
to set uniform regulations within the industry. This would assure that 
pears will physiologically have the ability to ripen properly at any 
stage of the marketing season. It was considered by witnesses that this 
additional quality definition is imperative to the industry's future 
ability to uniformly address and set regulations for ripen ability.
    By establishing maturity regulations, the Winter Pear industry also 
aims to present a more consumer-friendly product to the market. 
Historically, the winter pear industry has not directly concerned 
itself with the ripening process of pears once they reach the retail 
sector or the consumer. The task of ripening prior to consumption has 
generally been left to the end buyer, while the Committee provided 
basic education about how a pear can be ripened at home.
    One witness stated that the proposed authority to regulate maturity 
would enable the industry to ensure that winter pears have the best 
opportunity to either ripen or be ripe at time of purchase. Under the 
current system without maturity regulations, it can take up to seven 
days for a winter pear to ripen at room temperature. The witness 
further added that in today's modern lifestyle, convenience is often 
the greatest consideration for consumers when selecting food products. 
For this reason, maturity requirements are needed in order for the 
industry to better meet consumer needs and satisfaction.
    In addition, increasing competition from imported fruit in the 
domestic market has caused the Oregon and Washington winter pear 
industry to market its harvest much earlier than in previous years. 
However, selling too early in the harvest season places the Oregon and 
Washington winter pear industry at a disadvantage as without careful 
monitoring of maturity indices to ensure timely picking, ripening is 
more difficult to achieve. Traditionally, the industry has relied upon 
the late Spring and early Summer sales to profitably move the crop as, 
under these conditions, winter pears are more inclined to ripen 
naturally and maturity indices are not as much of a concern.
    Another witness testifying at the hearing explained that 
geometrically increasing imported pears from outside the production 
area have seriously disrupted the traditional marketing scheme for 
Oregon and Washington pears. According to his testimony, imported pears 
currently approach five million boxes per marketing season, directly 
competing with Northwest product in the late Winter and Spring months. 
One of the main competitors, Bartlett pears imported from the Southern 
Hemisphere, poses a particularly difficult challenge, as Bartletts 
ripen more easily than winter pears and are considered more consumer 
friendly by announcing their edibility through a color change. Winter 
pears from Oregon and Washington are considered by some to be less user 
friendly, remaining green throughout the process of senescence.
    The dramatically increasing imports are altering Oregon and 
Washington winter pear marketing schemes, forcing more sales early in 
the season when pears are less inclined to ripen naturally. In order to 
meet consumer requirements and expectations, the Committee has 
identified maturity indices as a method to improve harvesting 
techniques earlier in the growing and harvest process. By having the 
authority to establish maturity regulations, the Committee envisions 
being able to market a more salable, more desirable product earlier in 
the market season.
    The authority to consider maturity in the regulatory criteria could 
feasibly enhance product quality throughout the industry harvest and 
storage regimen by establishing pressure regulations, shorten the 
consumer's waiting period for the fruit to ripen, and provide greater 
assurance to the consumer that the product will properly ripen at the 
time of purchase.
    The Oregon and Washington winter pear grower community has also 
recently demonstrated their support for pressure testing by 
recommending to the USDA the establishment of a maximum pressure limit 
for all D'Anjou pears entering the marketplace in 2000. While this 
standard was established through the informal rulemaking process under 
the authority to establish quality regulations, witnesses attending the 
hearing expressed the importance of including specific authority in the 
order

[[Page 15749]]

to regulate maturity regulations for any or all varieties of winter 
pears grown in the production area.
    Record evidence supports amending the marketing order to authorize 
the Committee to recommend maturity regulations for any or all 
varieties of pears grown in the winter pear industry. This would allow 
the Committee to recommend, and USDA to implement, minimum maturity 
requirements through informal rulemaking procedures. Furthermore, there 
was no opposition to the above proposal, described as Material Issue 
Number 1 in this recommended decision, voiced at the hearing.
    The Department is proposing that Sec. 927.51 of the order be 
amended to include the authority to establish maturity requirements.

Material Issue Number 2: The Authority To Fix the Size, Capacity, 
Weight, Dimensions, Markings, or Pack of Winter Pear Packaging or 
Handling Containers

    The order should be amended to add authority to fix the size, 
capacity, weight, dimensions, markings, or pack of the container, or 
containers, which may be used in the packaging or handling of winter 
pears. The definition of ``Size'' should also be amended to remove the 
currently defined dimensions of a standard pear box.
    Currently, the Winter Pear Control Committee, under the order, has 
no authority to implement container regulations. The Committee believes 
that adding this authority to the marketing order is necessary to 
engender coherency and consistency in the Washington and Oregon winter 
pear industry. The primary reasons to allow container regulations are: 
to eliminate confusion in the marketplace, standardize containers, 
provide for compliance, and, most importantly, to level the playing 
field, in terms of calculating the cost per unit of carton sales, among 
all suppliers to the market. The Committee believes that this authority 
would help reduce instances of confusion in the marketplace.
    The Committee also believes that any additional costs to the 
industry would be minimal and outweighed by the gains outlined above. 
Growers would benefit because their returns would be measurable against 
other industry returns, and production/packing systems would become 
more streamlined and efficient.
    Record testimony stated that widespread retail consolidation in the 
domestic market has resulted in a shrinking number of terminal market 
sellers. As such, Oregon and Washington winter pear growers and 
handlers have come under increasing pressure to compete against growers 
and handlers from outside the production area for retailer business. 
This pressure has been compounded by an influx of imported pears into 
the domestic market. The net result has been an oversupply of product 
in the market, and downward pressure on producer prices.
    In addition to competition with imported product, the Washington 
and Oregon winter pear industry is facing international marketing 
disadvantages associated with a strong U.S. dollar and lower demand for 
U.S. products abroad. The combination of increased supply and limited 
market outlets has presented ever-increasing challenges to the winter 
pear industry, causing it to consider competition and efficiency 
gaining techniques, such as container regulations.
    While the standard container used in the Washington and Oregon pear 
industry has historically been the ``Pakcart'', a 44-pound net weight 
box, retailer demand for new and innovative packaging of pears has 
resulted in a proliferation of new packages in the marketplace. While 
many packers have conformed to new packaging demands, maintaining 
competitiveness has become increasingly difficult due to the increase 
in container variety and the cost of maintaining inventories.
    Maintaining a varied inventory of package types, especially for 
smaller handlers, is costly and inefficient in warehouse packing 
systems. The majority of the increased container related production 
costs are passed on to the producer in the form of a lower net return 
on his or her product. As one witness testifying at the hearing stated, 
``Unfortunately, the way the industry works is all of the costs are 
accumulated and deducted from the (free on board) FOB price, and then 
the grower gets what's left.''
    A witness testifying at the hearing noted that due to consolidation 
of retail supermarkets, one of the main sources of distribution for 
winter pears, substantial pressure is placed on individual growers, 
packers and shippers to conform to container shipment demands. The 
witness indicated that it was not unusual for retail supermarkets to 
request special packaging, including special carton sizes, weights and 
other characteristics. With each special request for a unique package 
type, handling costs increase due to the need to keep a variety of 
containers in inventory and special packing requirements for each type 
of container. Uniform regulations for packaging would assist the 
handlers in not only avoiding additional costs but gaining increased 
operational efficiencies. Moreover, increased handling costs are more 
often than not passed on to the grower in the form of reduced payment 
for their product. Thus, it was argued that uniform packing 
requirements would also benefit the grower in the form of potentially 
higher returns.
    Witnesses also indicated that it is in the industry's best interest 
to work with its customers, specifically retail supermarkets, to 
provide efficient packaging for the mutual benefit of all parties, 
including growers, customers and consumers. As a representative of the 
industry and local administrative body of the order, it was suggested 
that the Winter Pear Control Committee is in the best position to work 
with the industry and customers to develop the correct regulations 
relating to container size, capacity, weight, and dimensions.
    Witnesses demonstrated the need for uniformity in container size 
and dimensions by describing some of the various container varieties 
currently at use in the market. It was explained that cartons not only 
differ in dimension, but also in the number of stacking tabs, container 
material and liners. One type of container described was the ``Defore 
carton,'' also referred to as the ``Euro carton.'' This container, 
measuring 60 x 40 centimeters, is smaller and generally has a lighter 
net weight than the traditional container used in the production area. 
In addition to being a smaller box, some retailers differentiate their 
requests by specifying the number of desired tabs for stacking. The 
number of stacking tabs requested per Euro carton can vary from four to 
six to eight.
    Another type of carton requested by retailers is known as a 
corrugated ``Kraft carton'' (similar to the Packart, described above), 
while others request the Kraft carton with a black inside liner.
    In addition to differing container dimensions and other physical 
characteristics, containers of varying weight have become prevalent in 
the market. One witness used as an example the California Bartlett 
industry, which has implemented a system in which some fruit is at a 
40-pound net weight, and some at a 44-pound net weight. Moreover, 
imported South American pears are packed in an 18-kilogram carton, or a 
40-pound net weight box, while pears imported from New Zealand and 
South Africa are generally packed in the Euro 60 x 40 carton.
    Witnesses testifying on the need for the authority to establish 
container regulation argued that a market supplied

[[Page 15750]]

with a proliferation of container types and weights leads to confusion 
among buyers and sellers, inevitably resulting in inequitable net 
returns to producers. Packages that are not consistent in size or 
weight across the market make it difficult for retailers to easily 
conduct cost per unit comparisons among packers. The authority to 
regulate container regulations would level the playing field by 
standardizing transaction units between all sellers and buyers. One 
witness reasoned that with uniform container and packing regulations, a 
buyer would know exactly what he or she is purchasing regardless of 
where or from what source it is purchased. Packers would have the same 
size, weight, marking and pack requirements, assuring that the buyer is 
getting the same product. Growers would know exactly what amount of 
product is being sold and promoted at what return. Furthermore, the 
witness stated that, ``Presently it is not uncommon for us to be 
comparing `pears to apples' because of the lack of standardization 
within our industry. The proposal will eliminate confusion in the 
market and I believe help streamline the process.'' It was further 
argued that the adoption of this proposal would allow buyers, 
consumers, packers and growers of winter pears to compare ``pears to 
pears,'' regardless of the source.
    Without a consistent standard developed by the industry, individual 
growers and packers will attempt to respond to each individual 
customer's demand, adding confusion in the marketplace. A packer may 
have multiple inventories of the same package, once again increasing 
costs to the parties involved.
    Moreover, without enforced container regulations, buyers of winter 
pears are not always aware of the net weight of the container that they 
are being quoted. As winter pear sales are typically negotiated in 
numbers of cartons, markedly different carton weights result in pears 
being purchased at differing prices per pound.
    The authority to establish container regulations, and to adjust 
those regulations in step with changing retailer demand, would enable 
the Committee to maintain coherency within the winter pear market 
packaging regulations.
    Historically, the size of winter pears is determined by the number 
of pears contained in a standard 44-pound container. This concept is 
also commonly referred to as ``Pack.'' As one witness explained at the 
hearing, ``Pack'' refers to the amount of product that is put in each 
box and describes to the purchaser the size of the product that they 
are buying. For example, if purchaser is buying size 100 pears, the 
pack definition indicates that there are 100 pears in a standard 44-
pound box. However, with non-traditional boxes entering the 
marketplace, the term pack has lost some significance in that the 
standard 44-pound box is no longer the industry point of reference.
    As one witness testified, retail price calculations, which have 
traditionally been based on the number of pears per standard 44-pound 
box, are no longer uniform throughout the marketplace as industry 
packing material is not standardized. If a retailer is in error on what 
the actual poundage of a box is, he or she may be computing higher or 
lower retail prices, which ultimately affects the volume of product 
sold.
    Members of the Committee attending the hearing testified that the 
proposal to grant authority to fix the size, capacity, weight, 
dimensions, markings, or pack of a container, or containers, used in 
the packaging or handling of winter pears has been widely discussed 
within the grower community. Among the witnesses testifying, it was 
widely stated that implementing this authority would equally benefit 
small and large producers by standardizing containers and packing 
requirements and enhancing uniformity in the market.
    It was also requested by witnesses at the hearing that definitions 
for ``pack'' and ``container'' be added to the list of definitions in 
the order to further clarify Proposal No. 2. Adding these two 
definitions would assist in clarifying future requirements established 
under the above proposed authority. Proposed definitions of both terms 
were presented at the hearing and are supported by the hearing record.
    Record evidence supports amending the marketing order to authorize 
the Committee to recommend size, capacity, weight, dimensions, 
markings, or pack of the container, or containers, which may be used in 
the packaging or handling of winter pears. This would allow the 
Committee to recommend, and USDA to implement, such pack and container 
requirements through informal rulemaking procedures. Furthermore, there 
was no opposition to the above proposal, described as Material Issue 
Number 2 in this recommended decision, voiced at the hearing.
    Accordingly, the Department is proposing that Sec. 927.51 be 
amended by adding a new subparagraph (a)(3), which would provide the 
authority to fix the size, capacity, weight, dimensions, markings, or 
pack of the container, or containers, which may be used in the 
packaging or handling of winter pears. The Department is also proposing 
that Sec. 927.5 be amended to remove the currently defined dimensions 
of a standard pear box. This would allow the flexibility to establish, 
and revise as needed, new container dimensions, and would be consistent 
with this amendment.
    The Department is also proposing that definitions for ``pack'' and 
``container'' be added to the order. Adding these two definitions would 
assist in defining future requirements established under the above 
proposed authority.

Material Issue Number 3: Designation of a Temporary Alternate To Act 
for an Absent Committee Member

    The order should be amended to include the authority for a 
Committee member, when that Committee member and his or her alternates 
are unable to attend a Committee meeting, to designate any alternate 
from the same group (handler or grower) to serve in their stead. 
However, the Department believes that this discretion should not be 
given to the Committee or its chairperson in the event the member in 
question chooses not to designate another alternate to serve in his or 
her place.
    The Committee is composed of 12 members, with the industry members 
allocated among four geographic districts. Each Committee member has 
two alternates who have the same qualifications as the member. 
Committee members and alternates are nominated by their peers in the 
district they represent.
    Section 927.28 of the order provides that if a Committee member is 
absent from a meeting, one of his or her alternates shall act in that 
member's place. There is no provision for a situation in which both the 
member and that member's alternates are unavailable.
    The Committee proposed changing Sec. 927.28 as follows. If both a 
member and his or her alternates cannot attend a Committee meeting, the 
member or the alternates (in that order) could designate another 
alternate member to act in their stead. The temporary alternate would 
be chosen from the group of other Committee member alternates and would 
represent both the same district and group (grower or handler) as the 
Committee member needing an alternate. If neither the Committee member 
nor that Committee member's alternates choose to make such a 
designation, the Committee chairperson would be free to do so with the 
concurrence of a majority of the present members.

[[Page 15751]]

    In support of the Committee's proposal, witnesses testifying at the 
hearing felt strongly about the need to ensure grower and handler 
representation at all meetings. One witness stated, ``Being denied an 
important vote because of a technicality of succession, and thus not 
being represented, is not fair to the growers who pay the assessment to 
the Winter Pear Control Committee.''
    Witnesses testifying believed that the authority to temporarily 
appoint additional alternates was justifiable for many reasons. Most 
importantly, the small size of grower districts, and the proximity of 
growers and handlers in their local communities, makes for a tight-knit 
group who are generally savvy of their community's needs and opinions. 
Thus, testimony strongly supported the idea that district positions 
could be accurately represented by appointing temporary alternates from 
the same district and group (grower or handler). As one witness pointed 
out, ``We're not strangers to each other, and our views on pear 
marketing are generally well known.''
    According to the record, it was recommended that the selection 
process of temporary alternates would be somewhat of an ``informal'' 
process, whereby a temporary alternate would be recommended to the 
Control Committee by the absent Committee member, or one of his or her 
alternates. Selection of the temporary alternate would ultimately be 
overseen and rely on the discretion of the Control Committee.
    An example presented at the hearing is as follows. In the Hood 
River district, there are four Committee members (two growers and two 
handlers), each having two alternates. In the event that one of the 
Hood River Committee members and both his or her alternates were unable 
to attend a Committee meeting, a temporary alternate would be selected 
from the second (grower or handler) Hood River Committee member's two 
alternates. As described above, the selection would be recommended by 
the absent Committee member and approved by the Control Committee. If 
the Committee member was absent, then the selection would be made by 
one of his or her alternates and approved by the Control Committee.
    The Department agrees that full participation at Committee meetings 
should be encouraged. The Department also believes that there is merit 
in allocating membership among districts because the conditions in one 
district may vary considerably from those in another. However, if a 
member chooses not to name someone to fill his or her seat and cast 
votes on his or her behalf, the choice should neither revert to the 
Committee or its chairperson nor the absent member's alternates. 
Committee members are nominated by their grower and handler peers to 
represent them at Committee meetings. The absent Committee member's 
charge to represent, or provide alternate representation for, his or 
her peers is an important part of fulfilling his or her 
responsibilities as a Committee member for that district. In light of 
the above, should a situation arise where neither a Committee member 
nor his or her alternates are able to attend a meeting, the Committee 
member should arrange for a temporary alternate. For these reasons, we 
believe that only a Committee member should be able to choose a 
temporary alternate to serve in his or her place when that member and 
that member's alternates are unavailable.
    With regard to the language suggested by the Committee that would 
only apply to two out of the four winter pear production area 
districts, the proposed language does not take into consideration a 
selection process for districts having only one grower or one handler 
Committee member.
    Only the Hood River-White Salmon-Underwood and Wenatchee districts 
have four Committee members (two growers and two handlers), hence a 
total of four alternate members for each group meeting the proposed 
district and group criteria. However, the Medford and Yakima districts 
only have two Committee members (one grower and one handler) each. In 
the event that a Medford or Yakima Committee member and both of that 
member's alternates could not attend a Committee meeting, their ability 
to find a temporary alternate who would meet both the district and 
group criteria would be restricted under the Committee's proposal.
    In order to make the proposed amendment more practicable, the 
Committee's proposed language has been modified to provide that a 
temporary alternate may be selected from the collective pool of all 
Committee member alternates, but must represent the same group (grower 
or handler) as the absent member. Thus, in the event that all 
alternates for Committee members in the same group representing a given 
district are unavailable, selection of a temporary alternate would rely 
on the availability of other Committee members' alternates from the 
remaining districts, provided that the selected temporary alternate 
represented the same group (grower or handler).
    Drawing from the Hood River district example given above, in the 
event that one of the Hood River grower Committee members and both his 
or her alternates were unable to attend a Committee meeting, the 
selection process of a temporary alternate for that meeting would begin 
with the second Hood River grower Committee member's two alternates. If 
neither of those two alternates were available, the selection process 
would proceed to the availability of other, non-Hood River grower 
Committee members' alternates until a temporary alternate was found.
    In the case of districts having only two Committee members, a 
temporary alternate would be selected by the absent Committee member 
from the collective pool of alternates from all districts and would 
represent the same group (grower or handler).
    Given these considerations, the Department proposes the following 
language be added to Sec. 927.28: In the event that both a member of 
the Control Committee and that member's alternates are unable to attend 
a Control Committee meeting, the member may designate any other 
alternate member from the same group (handler or grower) to serve in 
that member's place and stead.

The Regulatory Flexibility Act and Effects on Small Businesses

    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA), the Agricultural Marketing Service (AMS) has considered the 
economic impact of this action 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 so that small businesses will not be 
unduly or disproportionately burdened. Marketing orders issued pursuant 
to the Act and amendments thereto are unique in that they are normally 
brought about through group action of essentially small entities acting 
on their own behalf. Thus, both the RFA and the Act are compatible with 
respect to small entities.
    According to the Small Business Administration (13 CFR 121.201) 
small handlers are those having annual receipts of less than $5,000,000 
and small agricultural producers are defined as those with annual 
receipts of less than $750,000. Based on testimony presented at the 
hearing, a majority of the winter pear producers are considered small 
under the SBA definition. Of the 1,800 winter pear growers, 80 to 85 
percent are estimated to have sales equal to or less than $750,000. 
There are 90 handlers

[[Page 15752]]

operating in the production area. The majority of these handlers fit 
the SBA definition of a small handler. Thus, this action will apply 
primarily to small entities.
    This recommended decision proposes making the following amendments 
to the winter pear marketing order: (1) To amend Sec. 927.51(a)(1) of 
the order to specifically authorize the establishment of maturity 
regulations; (2) To amend Sec. 927.51 of the order to authorize the 
establishment of container requirements which would encompass capacity, 
weight, dimensions, and packing of the container, or containers, which 
may be used in packaging or handling of pears; and (3) To amend 
Sec. 927.28 of the order to authorize additional alternates to serve 
for a Committee member in the event that both that member and that 
member's alternates are unable to attend a Committee meeting.
    These actions are designed to enhance the quality of winter pears 
at consumer outlets through the regulation of maturity regulations, to 
create more orderly marketing conditions for winter pears through the 
implementation of container uniformity, to improve grower returns 
through these combined actions, and to ensure grower and handler 
representation at all Committee meetings.
    Members of the Winter Pear Control Committee attending the hearing 
testified that the proposal to grant authority to establish maturity 
regulations has been widely discussed within the grower community, an 
estimated 80 to 85 percent of which qualify as small producers. 
Moreover, among the witnesses testifying, it was often stated that 
implementing maturity requirements would equally benefit small and 
large producers by standardizing industry requirements and enhancing 
overall product quality in the market.
    Small handlers from both Oregon and Washington were present and 
participated in the hearing, and indicated their support for this 
proposal. When asked if such regulations would increase handler costs, 
one small handler responded that while some additional inspection costs 
would be incurred, those costs are expected to be offset with the 
increase in consumption. Ultimately, witnesses testifying at the 
hearing indicated that net returns to both handlers and producers would 
increase.
    Testimony also indicated that the proposal to grant authority to 
fix the size, capacity, weight, dimensions, markings, or pack of the 
container, or containers, used in the packaging or handling of winter 
pears has been widely discussed within the winter pear industry. The 
proposed provisions in this recommended decision also include 
definitions of ``pack'' and ``container'' that are added based upon 
testimony at the hearing. Among the witnesses testifying, it was widely 
stated that implementing this authority would equally benefit both 
small and large handlers and growers. By standardizing container and 
packing requirements, handling costs would decrease through reduced 
inventories and more efficient packing procedures. Uniformity in the 
market would also facilitate standardized transactions by ensuring more 
equitable cost per unit comparisons and producer returns on product.
    Small handlers testifying at the hearing indicated their support 
for this proposal. When asked if such regulations would increase 
handler costs, one small handler explained that the costs of new 
containers are likely to be offset by gains in packing efficiency and a 
more transparent cost per unit comparisons in handler to retailer 
transactions. Small producers testifying to this issue realized that 
increased costs in packing material would more than likely be passed 
from the handler to the grower, but the net gain from container 
standardization will ultimately benefit the industry as a whole, 
including the small producer. It was stated that by removing confusion 
related to container size in the marketplace, growers should get a 
fairer return on their product.
    In the case of districts having only two Committee members, a 
temporary alternate will be selected by the absent Committee member 
from the collective pool of alternates from all districts and will 
represent the same group (grower or handler). The proposed provisions 
in this recommended decision represents a modification to the 
Committee's proposal in order to better effectuate its terms. This 
method of selecting a temporary alternate would ensure representation 
of all growers and handlers (both large and small) at Committee 
meetings while having little or no increase in Committee administrative 
costs. Moreover, testimony demonstrated that the authority to 
temporarily assign alternates would improve representation of the small 
producers and handlers.
    USDA has not identified any relevant Federal rules that duplicate, 
overlap or conflict with this proposed rule. All of these amendments 
are designed to enhance the administration and functioning of the 
marketing order to the benefit of the industry.
    Committee meetings held to discuss these proposals, as well as the 
hearing, were widely publicized throughout the Oregon and Washington 
winter pear production area. All interested persons were invited to 
attend the meetings and the hearing, and participate in Committee 
deliberations on all issues. All Committee meetings and the hearing 
were public forums, and all entities, both large and small, were able 
to express views on these issues. The Committee itself is composed of 
12 members, of whom six are handlers and six are producers. Finally, 
interested persons are invited to submit information on the regulatory 
and informational impacts of this action on small businesses.
    A small business guide on complying with fruit, vegetable, and 
specialty crop marketing agreements and orders may be viewed at the 
following web site: 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 deemed to allow interested persons to 
respond to this proposal and facilitate the completion of this 
proceeding.

Civil Justice Reform

    The amendments proposed herein have been reviewed under Executive 
Order 12988, Civil Justice Reform. They are not intended to have 
retroactive effect. If adopted, the proposed amendments will not 
preempt any State or local laws, regulations, or policies, unless they 
present an irreconcilable conflict with the amendments.
    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. A 
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 date of the 
entry of the ruling.

[[Page 15753]]

General Findings

    The findings hereinafter set forth are supplementary to the 
findings and determinations which were previously made in connection 
with the issuance of the marketing agreement and order; and all said 
previous findings and determinations are hereby ratified and affirmed, 
except insofar as such findings and determinations may be in conflict 
with the findings and determinations set forth herein.
    (1) The marketing agreement and order, as amended, and as hereby 
proposed to be further amended, and all of the terms and conditions 
thereof, would tend to effectuate the declared policy of the Act;
    (2) The marketing agreement and order, as amended, and as hereby 
proposed to be further amended, regulate the handling of winter pears 
grown in the production area in the same manner as, and are applicable 
only to, persons in the respective classes of commercial and industrial 
activity specified in the marketing agreement and order upon which a 
hearing has been held;
    (3) The marketing agreement and order, as amended, and as hereby 
proposed to be further amended, are limited in their application to the 
smallest regional production area which is practicable, consistent with 
carrying out the declared policy of the Act, and the issuance of 
several orders applicable to subdivisions of the production area would 
not effectively carry out the declared policy of the Act;
    (4) The marketing agreement and order, as amended, and as hereby 
proposed to be further amended, prescribe, insofar as practicable, such 
different terms applicable to different parts of the production area as 
are necessary to give due recognition to the differences in the 
production and marketing of winter pears cherries grown in the 
production area; and
    (5) All handling of winter pears grown in the production area as 
defined in the marketing agreement and order, is in the current of 
interstate or foreign commerce or directly burdens, obstructs, or 
affects such commerce.

List of Subjects in 7 CFR Part 927

    Marketing agreements, Pears, Reporting and record keeping 
requirements.

Recommended Amendment of the Marketing Agreement and Order

    For the reasons set out in the preamble, 7 CFR part 927 is proposed 
to be amended as follows:

PART 927--WINTER PEARS GROWN IN OREGON AND WASHINGTON

    1. The authority citation for 7 CFR part 927 continues to read as 
follows:

    Authority: 7 U.S.C. 601-674.
* * * * *
    2. Revise Sec. 927.5 to read as follows:


Sec. 927.5  Size

    Size means the number of pears which can be packed in a standard 
pear box when packed in accordance with the packing requirements of the 
U.S. Standards for Pears (part 51 of this title), or as such 
regulations hereafter may be modified or as ``size'' may be more 
specifically defined in a regulation issued under this part.
    3. Add new Secs. 927.14 and 927.15 under the undesignated center 
heading ``Definitions'' to read as follows:


Sec. 927.14  Pack.

    Pack means the specific arrangement, size, weight, count, or grade 
of a quantity of pears in a particular type and size of container, or 
any combination thereof.


Sec. 927.15  Container.

    Container means a box, bag, crate, lug, basket, carton, package, or 
any other type of receptacle used in the packaging or handling of 
pears.
    5. Revise Sec. 927.28 to read as follows:


Sec. 927.28  Alternates for members of the Control Committee.

    The first alternate for a member shall act in the place and stead 
of the member for whom he or she is an alternate during such member's 
absence. In the event of the death, removal, resignation, or 
disqualification of a member, his or her first alternate shall act as a 
member until a successor for the member is selected and has qualified. 
The second alternate for a member shall serve in the place and stead of 
the member for whom he or she is an alternate whenever both the member 
and his or her first alternate are unable to serve. In the event that 
both a member of the Control Committee and that member's alternates are 
unable to attend a Control Committee meeting, the member may designate 
any other alternate member from the same group (handler or grower) to 
serve in that member's place and stead.
    4. Amend Sec. 927.51 by revising paragraph (a) to read as follows:


Sec. 927.51  Issuance of regulations; and modification suspension, or 
termination thereof.

    (a) Whenever the Secretary finds, from the recommendations and 
information submitted by the Control Committee, or from other available 
information, that regulation, in the manner specified in the section, 
of the shipment of pears would tend to effectuate the declared policy 
of the act, he or she shall so limit the shipment of pears during a 
specified period or periods. Such regulation:
    (1) May limit the total quantity of any grade, size, quality, 
maturity, or combination thereof, of any variety of pears grown in any 
district and may prescribe different requirements applicable to 
shipments to different export markets; or
    (2) May prescribe minimum standards of quality for any variety of 
pears and limit the shipment thereof to those meeting such minimum 
standards; or
    (3) Fix the size, capacity, weight, dimensions, markings, or pack 
of the container, or containers, which may be used in packaging or 
handling of pears.

    Dated: March 27, 2002.
A.J. Yates,
Administrator, Agricultural Marketing Service.
[FR Doc. 02-7918 Filed 4-2-02; 8:45 am]
BILLING CODE 3410-02-P