[Federal Register Volume 69, Number 145 (Thursday, July 29, 2004)]
[Rules and Regulations]
[Pages 45233-45236]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-17272]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Parts 922 and 923

[Docket No. FV04-922-1 IFR]


Decreased Assessment Rates for Specified Marketing Orders

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Interim final rule with request for comments.

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SUMMARY: This rule decreases the assessment rates established for the 
Washington Apricot Marketing Committee and the Washington Cherry 
Marketing Committee (Committees) for the 2004-2005 and subsequent 
fiscal periods. This rule decreases the assessment rates established 
for the Committees from $3.00 to $2.50 per ton for Washington apricots 
and from $1.00 to $0.75 per ton for Washington sweet cherries. The 
Committees are responsible for local administration of the marketing 
orders that regulate the handling of apricots and cherries grown in 
designated counties in Washington. Authorization to assess apricot and 
cherry handlers enables the Committees to incur expenses that are 
reasonable

[[Page 45234]]

and necessary to administer the programs. The fiscal period for both 
marketing orders began April 1 and ends March 31. The assessment rates 
will remain in effect indefinitely unless modified, suspended, or 
terminated.

DATES: Effective July 30, 2004. Comments received by September 27, 
2004, 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; E-mail: [email protected]; or 
Internet: http://www.regulations.gov. 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: Teresa L. Hutchinson, Marketing 
Specialist, Northwest Marketing Field Office, Marketing Order 
Administration Branch, Fruit and Vegetable Programs, AMS, USDA, 1220 
SW. Third Avenue, suite 385, Portland, OR 97204; telephone: (503) 326-
2724, Fax: (503) 326-7440; or George J. 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, 
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. 922 (7 CFR part 922) regulating the handling of 
apricots grown in designated counties in Washington, and Marketing 
Agreement and Order No. 923 (7 CFR part 923) regulating the handling of 
sweet cherries grown in designated counties in Washington, hereinafter 
referred to as the ``orders.'' The orders are effective under the 
Agricultural Marketing Agreement Act of 1937, as amended (7 U.S.C. 601-
674), hereinafter referred to as the ``Act.''
    The Department 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 orders now in effect, handlers in 
designated counties in Washington are subject to assessments. Funds to 
administer the orders are derived from such assessments. It is intended 
that the assessment rates as issued herein will be applicable to all 
assessable Washington apricots and Washington sweet cherries beginning 
April 1, 2004, 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 rates established for the 
Committees for the 2004-2005 and subsequent fiscal periods from $3.00 
to $2.50 per ton for Washington apricots and from $1.00 to $0.75 per 
ton for Washington sweet cherries.
    The orders provide authority for the Committees, with the approval 
of USDA, to formulate annual budgets of expenses and collect 
assessments from handlers to administer the program. The members of the 
Committees are producers and handlers of apricots and sweet cherries in 
designated counties in Washington. They are familiar with the 
Committees' needs and with the costs for goods and services in their 
local areas and are thus in a position to formulate appropriate budgets 
and assessment rates. The assessment rates are formulated and discussed 
in public meetings. Thus, all directly affected persons have an 
opportunity to participate and provide input.
    For the 2003-2004 and subsequent fiscal periods, the Washington 
Apricot Marketing Committee (Apricot Committee) recommended, and USDA 
approved, an assessment rate of $3.00 per ton of apricots handled. This 
assessment rate continues in effect from fiscal period to fiscal period 
unless modified, suspended, or terminated by USDA upon recommendation 
and information submitted by the Apricot Committee or other information 
available to USDA.
    The Apricot Committee met on May 17, 2004, and unanimously 
recommended 2004-2005 expenditures of $10,594 and a decreased 
assessment rate of $2.50 per ton of assessable apricots handled. In 
comparison, last year's budgeted expenditures were $10,559. The 
assessment rate of $2.50 is $0.50 lower than the rate currently in 
effect. Due to an anticipated increase in apricot production this 
season, the Apricot Committee recommended the assessment rate decrease 
to maintain the level of income at or near the level of expenses.
    The assessment rate recommended by the Apricot Committee was 
derived by dividing anticipated expenses by expected shipments of 
Washington apricots. Applying the $2.50 per ton rate of assessment to 
the Apricot Committee's 4,350-ton crop estimate should provide $10,875 
in assessment income. Thus, income derived from handler assessments 
will be adequate to cover the recommended 2004-2005 budget of $10,594. 
Funds in the reserve ($11,418 as of March 31, 2004) will be maintained 
at a level equal to approximately one fiscal period's operational 
expenses as authorized by the order (Sec.  922.42).
    For the 2003-2004 and subsequent fiscal periods, the Washington 
Cherry Marketing Committee (Cherry Committee) recommended, and the USDA 
approved, an assessment rate of $1.00 per ton of sweet cherries 
handled. This rate continues in effect from fiscal period to fiscal 
period unless modified, suspended, or terminated by USDA upon 
recommendation and information submitted by the Cherry Committee or 
other information available to USDA.
    The Cherry Committee met on May 18, 2004, and unanimously 
recommended 2004-2005 expenditures of $72,297 and a decreased 
assessment rate of $0.75 per ton of assessable cherries handled. In 
comparison, last year's budgeted expenditures were $71,865. The 
assessment rate of $0.75 is $0.25 lower than the rate previously in 
effect. Due to an anticipated increase in

[[Page 45235]]

cherry production this season, the Cherry Committee recommended the 
assessment rate decrease in order to maintain the level of income near 
the level of expenses.
    The assessment rate recommended by the Cherry Committee was derived 
by dividing anticipated expenses by expected shipments of Washington 
sweet cherries. Applying the $0.75 per ton rate of assessment to the 
Cherry Committee's 112,600-ton crop estimate should provide $84,450 in 
assessment income. Thus, income derived from handler assessments will 
be adequate to cover the recommended 2004-2005 budget of $72,297. Funds 
in the reserve ($58,970 as of March 31, 2004), will be kept within the 
maximum permitted by the order of approximately one fiscal period's 
operational expenses (Sec.  923.42).
    Both Committees are managed from the same office, thus combined 
major expenses recommended by the Committees for the 2004-2005 year 
include staff salaries ($50,572), rent and maintenance ($6,624), 
compliance ($4,740), and Committee travel and compensation ($3,200). 
These budgeted expenses are the same as those approved for the 2003-
2004 fiscal period.
    The assessment rates established in this rule will continue in 
effect indefinitely unless modified, suspended, or terminated by USDA 
upon recommendation and information submitted by the Committees or 
other available information.
    Although these assessment rates are effective for an indefinite 
period, the Committees will continue to meet prior to or during each 
fiscal period to recommend budgets of expenses and consider 
recommendations for modification of the assessment rates. The dates and 
times of the Committees' meetings are available from the Committees or 
USDA. The Committees' meetings are open to the public and interested 
persons may express their views at these meetings. USDA will evaluate 
the Committees' recommendations and other available information to 
determine whether modification of the assessment rates is needed. 
Further rulemaking will be undertaken as necessary. The Committees' 
2004-2005 budgets and those for subsequent fiscal periods 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 272 apricot producers and 1,800 sweet 
cherry producers in designated counties in Washington. In addition, 
there are approximately 28 Washington apricot handlers and 69 
Washington sweet cherry handlers subject to regulation under the 
respective marketing orders. Small agricultural producers are defined 
by the Small Business Administration (13 CFR 121.201) as those having 
annual receipts of less than $750,000, and small agricultural service 
firms are defined as those whose annual receipts are less than 
$5,000,000.
    Based on the total number of apricot producers (272), the most 
recent three-year average fresh apricot production of 3,975 tons 
(Apricot Committee records), and the most recent three-year average 
producer price of $355 per ton as reported by National Agricultural 
Statistics Service (NASS), average annual revenue per producer from the 
sale of apricots is approximately $5,188. In addition, based on Apricot 
Committee records and 2003 f.o.b. prices ranging from $10.50 to $12.50 
per 24-pound container as reported by USDA's Market News Service (MNS), 
the entire Washington apricot industry handles less than $5,000,000 
worth of apricots.
    Based on the total number of sweet cherry producers (1,800), the 
most recent three-year average fresh cherry production of 79,763 tons 
(Cherry Committee records), and the most recent three-year average 
producer price of $1,390 per ton as reported by NASS, the average 
annual revenue per producer from the sale of cherries is approximately 
$61,595. In addition, based on Cherry Committee records and an average 
2003 f.o.b. price of $28.00 per 20-pound container as reported by the 
MNS, 75 percent of the Washington cherry handlers ship under $5,000,000 
worth of cherries. In view of the forgoing, the majority of Washington 
cherry producers and handlers may be classified as small entities.
    This rule decreases the assessment rates established for the 
Committees and collected from handlers for the 2004-2005 and subsequent 
fiscal periods from $3.00 to $2.50 per ton for apricots and from $1.00 
to $0.75 per ton for sweet cherries. The Apricot Committee and the 
Cherry Committee unanimously recommended 2004-2005 expenditures of 
$10,594 and $72,297, respectively. With the 2004-2005 crop estimates of 
4,350 tons for apricots and 112,600 tons for sweet cherries, the 
Committees anticipate assessment income of $10,875 and $84,450, 
respectively, which will be adequate to cover budgeted expenses for 
both programs. These assessment incomes will maintain the Committees' 
reserve funds at or near the levels authorized by the orders of 
approximately one fiscal period's operational expenses (Sec. Sec.  
922.42 and 923.42).
    Both Committees are managed from the same office, thus combined 
major expenses recommended by the Committees for the 2004-2005 year 
include staff salaries ($50,572), rent and maintenance ($6,624), 
compliance ($4,740), and Committee travel and compensation ($3,200). 
These budgeted expenses are the same as those approved for the 2003-
2004 fiscal period.
    The Committees discussed alternatives to this rule, including 
alternative expenditure levels, but determined that the recommended 
expenses were reasonable and necessary to adequately cover program 
operations. Lower assessment rates were considered, but not recommended 
because they would not generate the income necessary to administer the 
programs.
    A review of historical information and preliminary information 
pertaining to the upcoming crop year indicates that the producer price 
for the 2004-2005 season could range between $353 and $357 per ton for 
Washington apricots and between $1,230 and $1,550 per ton for 
Washington sweet cherries. Therefore, the estimated assessment revenue 
for the 2004-2005 fiscal period as a percentage of total producer 
revenue could range between 0.70 and 0.71 percent for Washington 
apricots and between 0.05 and 0.06 percent for Washington sweet 
cherries.
    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 rates reduces the burden on handlers, and may reduce the 
burden on producers. In addition, the Committees' meetings were widely 
publicized throughout the Washington apricot and Washington sweet 
cherry industries and all interested persons

[[Page 45236]]

were invited to attend and participate in the Committees' deliberations 
on all issues. Like all Committee meetings, the May 17 and May 18, 
2004, meetings were public meetings and all entities, both large and 
small, were able to express views on the issues. 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 Washington apricot or Washington 
sweet cherry 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.ama.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 Committees 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 2004-2005 fiscal period for both orders began 
on April 1, 2004, and both orders require that the rate of assessment 
apply to all assessable Washington apricots and Washington sweet 
cherries handled during such fiscal period; (2) the Committees need to 
have sufficient funds to pay for expenses which are incurred on a 
continuous basis; (3) handlers are aware of this action which was 
unanimously recommended by both Committees at public meetings and are 
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

7 CFR Part 922

    Apricots, Marketing agreements, Reporting and recordkeeping 
requirements.

7 CFR Part 923

    Cherries, Marketing agreements, Reporting and recordkeeping 
requirements.q

0
For the reasons set forth in the preamble, 7 CFR parts 922 and 923 are 
amended as follows:
0
1. The authority citation for 7 CFR parts 922 and 923 continues to read 
as follows:

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

PART 922--APRICOTS GROWN IN DESIGNATED COUNTIES IN WASHINGTON

0
2. Section 922.235 is revised to read as follows:


Sec.  922.235  Assessment rate.

    On or after April 1, 2004, an assessment rate of $2.50 per ton is 
established for the Washington Apricot Marketing Committee.

PART 923--SWEET CHERRIES GROWN IN DESIGNATED COUNTIES IN WASHINGTON

0
3. Section 923.236 is revised to read as follows:


Sec.  923.236  Assessment rate.

    On or after April 1, 2004, an assessment rate of $0.75 per ton is 
established for the Washington Cherry Marketing Committee.

    Dated: July 23, 2004.
Kenneth C. Clayton,
Associate Administrator, Agricultural Marketing Service.
[FR Doc. 04-17272 Filed 7-28-04; 8:45 am]
BILLING CODE 3410-02-P