[Federal Register Volume 67, Number 225 (Thursday, November 21, 2002)]
[Proposed Rules]
[Pages 70182-70184]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-29600]


 ========================================================================
 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. 225 / Thursday, November 21, 2002 / 
Proposed Rules  

[[Page 70182]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 989

[Docket No. FV02-989-7 PR]


Raisins Produced From Grapes Grown in California; 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 Raisin Administrative Committee (Committee) for the 2002-03 and 
subsequent crop years from $6.50 to $8.00 per ton of free tonnage 
raisins acquired by handlers, and reserve tonnage raisins released or 
sold to handlers for use in free tonnage outlets. The Committee locally 
administers the Federal marketing order which regulates the handling of 
raisins produced from grapes grown in California (order). Authorization 
to assess raisin handlers enables the Committee to incur expenses that 
are reasonable and necessary to administer the program. The crop year 
runs from August 1 through July 31. The assessment rate would remain in 
effect indefinitely unless modified, suspended, or terminated.

DATES: Comments must be received by December 2, 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 made 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: Maureen T. Pello, Senior 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 and Order No. 989 (7 CFR part 989), both as amended, 
regulating the handling of raisins produced from grapes 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 
raisin 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 raisins beginning on August 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 crop years from $6.50 to $8.00 
per ton of free tonnage raisins acquired by handlers, and reserve 
tonnage raisins released or sold to handlers for use in free tonnage 
outlets. The order authorizes volume control provisions that establish 
free and reserve percentages for raisins acquired by handlers. Free 
tonnage raisins may be sold by handlers to any outlet, and reserve 
tonnage raisins are held by handlers for the account of the Committee 
or released or sold to handlers for sale to free tonnage outlets. 
Reserve raisins held for the account of the Committee are not 
assessable. With projected assessable tonnage about 81,000 tons less 
than last year's assessable tonnage, sufficient income should be 
generated at the higher assessment rate for the Committee to meet its 
anticipated expenses. This action was recommended by the Committee at a 
meeting on July 24, 2002.
    Sections 989.79 and 989.80, respectively, of the order provide 
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 raisins. They are familiar with the Committee's 
needs and with the costs of goods and services in their local area and 
are thus in a position to formulate an appropriate budget and

[[Page 70183]]

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.
    A continuous assessment rate of $6.50 per ton has been in effect 
since the 2000-01 crop year. For the 2002-03 crop year, the Committee 
recommended increasing the assessment rate to $8.00 per ton of 
assessable raisins to cover recommended administrative expenditures of 
$1,912,000. This compares to budgeted expenses of $2,080,000 for the 
2001-02 crop year. Major expenditures include $663,000 for export 
program administration and related activities, $500,000 for salaries, 
$164,800 for contingencies, and $160,000 for compliance activities. 
Budgeted expenses for these items in 2001-02 were $662,500, $500,000, 
$303,500, and $220,000, respectively.
    The recommended $8.00 per ton assessment rate was derived by 
dividing the $1,912,000 in anticipated expenses by an estimated 239,000 
tons of assessable raisins. The Committee recommended increasing its 
assessment rate because the projected 2002-03 assessable tonnage of 
239,000 tons is 81,000 tons lower than last year's assessable tonnage. 
Sufficient income should be generated at the higher assessment rate for 
the Committee to meet its anticipated expenses. Pursuant to Sec.  
989.81(a) of the order, any unexpended assessment funds from the crop 
year must be credited or refunded to the handlers from whom collected.
    The proposed assessment rate would continue in effect indefinitely 
unless modified, suspended, or terminated by USDA upon recommendation 
and other 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 
crop 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 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 crop years 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 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 in order that small businesses will 
not be unduly or disproportionately burdened. Marketing orders issued 
pursuant to the Act, and 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 20 handlers of California raisins who are 
subject to regulation under the order and approximately 4,500 raisin 
producers in the regulated area. Small agricultural firms are defined 
by the Small Business Administration (13 CFR 121.201) as those having 
annual receipts of less that $5,000,000, and small agricultural 
producers are defined as those having annual receipts of less than 
$750,000. Thirteen of the 20 handlers subject to regulation have annual 
sales estimated to be at least $5,000,000, and the remaining seven 
handlers have sales less than $5,000,000. No more than seven handlers, 
and a majority of producers, of California raisins 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 
crop years from $6.50 to $8.00 per ton of assessable raisins acquired 
by handlers. The Committee recommended 2002-03 expenditures of 
$1,912,000. Major expenditures include $663,000 for export program 
administration and related activities, $500,000 for salaries, $164,800 
for contingencies, and $160,000 for compliance activities. Budgeted 
expenses for these items in 2001-02 were $662,500, $500,000, $303,500, 
and $220,000, respectively. With anticipated assessable tonnage at 
239,000 tons, about 81,000 tons lower than last year's assessable 
tonnage, sufficient income should be generated at the $8.00 per ton 
assessment rate to meet expenses. Pursuant to Sec.  989.81(a) of the 
order, any unexpended assessment funds from the crop year must be 
credited or refunded to the handlers from whom collected.
    The industry considered various alternative assessment rates prior 
to arriving at the $8.00 per ton recommendation. The Committee's Audit 
Subcommittee met on July 24, 2002, to review preliminary budget 
information. The subcommittee was aware that the full Committee would 
be meeting later that day to consider actions that would impact the 
2002 free tonnage percentage and, thus, the quantity of 2002 assessable 
tonnage. The Audit Subcommittee considered assessment rates of $7.50 
and $8.00 per ton based on varying levels of assessable tonnage. 
Ultimately, the full Committee adopted the subcommittee's 
recommendation of $8.00 per ton based on 239,000 tons of assessable 
tonnage.
    A review of statistical data on the California raisin industry 
indicates that assessment revenue has consistently been less than one 
percent of grower revenue in recent years. Although no official 
estimates or data are available for the upcoming season, it is 
anticipated that assessment revenue will likely continue to be less 
than one percent of grower revenue in the 2002-03 crop year, even with 
the increased assessment rate.
    Regarding the impact of this action on affected entities, 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.
    Additionally, the Audit Subcommittee and full Committee meetings 
held on July 24, 2002, where this action was deliberated were public 
meetings widely publicized throughout the California raisin industry. 
All interested persons were invited to attend the meetings and 
participate in the industry's deliberations. Finally, all 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 raisin 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. Finally, 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

[[Page 70184]]

compliance guide should be sent to Jay Guerber at the previously 
mentioned address in the FOR FURTHER INFORMATION CONTACT section.
    A 10-day comment period is provided to allow interested persons to 
respond to this proposed rule. Ten days is deemed appropriate because a 
final decision on increasing the rate as proposed should be made by 
mid-November. This is when the Committee is anticipated to begin 
billing handlers for assessments.

List of Subjects in 7 CFR Part 989

    Grapes, Marketing agreements, Raisins, Reporting and recordkeeping 
requirements.
    For the reasons set forth in the preamble, 7 CFR part 989 is 
proposed to be amended as follows:

PART 989--RAISINS PRODUCED FROM GRAPES GROWN IN CALIFORNIA

    1. The authority citation for 7 CFR part 989 continues to read as 
follows:

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

    2. Section 989.347 is revised to read as follows:


Sec.  989.347  Assessment rate.

    On and after August 1, 2002, an assessment rate of $8.00 per ton is 
established for assessable raisins produced from grapes grown in 
California.

    Dated: November 14, 2002.
A.J. Yates,
Administrator, Agricultural Marketing Service.
[FR Doc. 02-29600 Filed 11-18-02; 4:50 pm]
BILLING CODE 3410-02-P