[Federal Register Volume 69, Number 157 (Monday, August 16, 2004)]
[Proposed Rules]
[Pages 50337-50339]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-18611]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 993

[Docket No. FV04-993-2 PR]


Dried Prunes Produced 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 Prune Marketing Committee (Committee) under Marketing Order No. 993 
for the 2004-05 and subsequent crop years from $2.00 to $4.00 per ton 
of salable dried prunes. The Committee locally administers the 
marketing order which regulates the handling of dried prunes grown in 
California. Authorization to assess dried prune handlers enables the 
Committee to incur expenses that are reasonable and necessary to 
administer the program. The Committee recommended a higher assessment 
rate because the 2004-05 crop is expected to be very small and a higher 
assessment rate is needed to generate sufficient funds to meet program 
expenses. The crop year begins August 1 and ends July 31. The 
assessment rate would remain in effect indefinitely unless modified, 
suspended, or terminated.

DATES: Comments must be received by September 7, 2004.

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], 
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: Toni Sasselli, Program Analyst, or 
Richard P. Van Diest, Marketing Specialist, California Marketing Field 
Office, 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. 993, both as amended (7 CFR part 993), 
regulating the handling of dried prunes grown in California, 
hereinafter referred to as the ``order.'' The marketing agreement and 
order 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 order now in effect, California 
dried prune 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 dried prunes beginning on August 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 would increase the assessment rate established for the 
Committee for the 2004-05 and subsequent crop years from $2.00 to $4.00 
per ton of salable dried prunes.
    The California dried prune marketing order provides authority for 
the Committee, with the approval of USDA, to formulate an annual budget 
of expenses and collect assessments from handlers to administer the 
program. The members of the Committee are producers and handlers of 
California dried prunes. 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 2003-04 and subsequent crop years, the Committee 
recommended, and USDA approved, an assessment rate that would continue 
in effect from crop year to crop year unless modified, suspended, or 
terminated by USDA upon recommendation and information submitted by the 
Committee or other information available to USDA.
    The Committee met on June 23, 2004, and unanimously recommended 
2004-05 expenditures of $275,800 and an assessment rate of $4.00 per 
ton of salable dried prunes. In comparison, last year's budgeted 
expenditures were $322,022. The assessment rate of $4.00 per ton is 
$2.00 higher than the rate currently in effect. The Committee 
recommended a higher assessment rate because a very small crop is 
expected this year. The salable prune production this year is expected 
to be 68,950 tons, the smallest crop since the early 1900's. The 
assessment rate of $4.00 per ton is expected to provide sufficient 
funds for Committee operations this year.
    The following table compares major budget expenditures recommended 
by the Committee on June 23, 2004, and major budget expenditures in the 
2003-04 budget.

[[Page 50338]]



------------------------------------------------------------------------
           Budget expense categories              2003-04      2004-05
------------------------------------------------------------------------
Total Personnel Salaries......................     $179,726     $181,335
Total Operating Expenses......................       96,876       85,080
Reserve for Contingencies.....................       45,420        9,385
------------------------------------------------------------------------

    The assessment rate recommended by the Committee was derived by 
dividing anticipated expenses by the estimated salable tons of 
California dried prunes. Production of dried prunes for the year is 
estimated at 68,950 salable tons, which should provide $275,800 in 
assessment income. Income derived from handler assessments is expected 
to be adequate to cover budgeted expenses. Interest income also would 
be available if assessment income is reduced for some reason. The 
Committee is authorized to use excess assessment funds from the 2003-04 
crop year (currently estimated at $105,000) for up to 5 months beyond 
the end of the crop year to meet 2004-05 crop year expenses. At the end 
of the 5 months, the Committee refunds or credits excess funds to 
handlers (Sec.  993.81(c)).
    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 
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 will 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 2004-05 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 rule on small entities. Accordingly, AMS has 
prepared this initial regulatory flexibility analysis.
    The purpose of the RFA is to fit regulatory actions to the scale of 
business subject to such actions in order that small businesses will 
not be unduly or disproportionately burdened. Marketing orders issued 
pursuant to the Act, and the rules issued thereunder, are unique in 
that they are brought about through group action of essentially small 
entities acting on their own behalf. Thus, both statutes have small 
entity orientation and compatibility.
    There are approximately 1,100 producers of dried prunes in the 
production area and approximately 22 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.
    Eight of the 22 handlers (36.4 percent) shipped over $5,000,000 of 
dried prunes and could be considered large handlers by the Small 
Business Administration. Fourteen of the 22 handlers (63.6 percent) 
shipped under $5,000,000 of dried prunes and could be considered small 
handlers. An estimated 32 producers, or less than 3 percent of the 
1,100 total producers, would be considered large growers with annual 
income over $750,000. The majority of handlers and producers of 
California dried prunes may be classified as small entities.
    This rule would increase the assessment rate established for the 
Committee and collected from handlers for the 2004-05 and subsequent 
crop years from $2.00 to $4.00 per ton of salable dried prunes. The 
Committee unanimously recommended 2004-05 expenditures of $275,800 and 
an assessment rate of $4.00 per ton of salable dried prunes. The 
proposed assessment rate of $4.00 per ton is $2.00 higher than the 
current rate. The quantity of assessable dried prunes for the 2004-05 
crop year is now estimated at 68,950 salable tons. Thus, the $4.00 rate 
should provide $275,800 in assessment income and be adequate to meet 
this year's expenses. Interest income also would be available to cover 
budgeted expenses if the 2004-05 expected assessment income falls 
short.
    The following table compares major budget expenditures recommended 
by the Committee on June 23, 2004, and major budget expenditures in the 
2003-04 budget.

------------------------------------------------------------------------
           Budget expense categories              2003-04      2004-05
------------------------------------------------------------------------
Total Personnel Salaries......................     $179,726     $181,335
Total Operating Expenses......................       96,876       85,080
Reserve for Contingencies.....................       45,420        9,385
------------------------------------------------------------------------

    Prior to arriving at its budget of $275,800, the Committee 
considered information from various sources, such as the Committee's 
Executive Subcommittee. An alternative to this action would be to 
continue with the $2.00 per ton assessment rate. However, an assessment 
rate of $2.00 per ton in combination with the estimated crop of 68,950 
salable tons would not generate sufficient monies needed to fund all 
the budget items for 2004-05. The assessment rate of $4.00 per ton of 
salable dried prunes was determined by dividing the total recommended 
budget by the estimated salable dried prunes. The Committee is 
authorized to use excess assessment funds from the 2003-04 crop year 
(currently estimated at $105,000) for up to 5 months beyond the end of 
the crop year to fund 2003-04 crop year expenses. At the end of the 5 
months, the Committee refunds or credits excess funds to handlers 
(Sec.  993.81(c)). Anticipated assessment income and interest income 
during 2004-05 would be adequate to cover authorized expenses.
    The grower price for the 2004-05 season is expected to average 
above the estimated 2003-04 average grower price of about $750 per 
salable ton of dried prunes. Based on an estimated 68,950 salable tons 
of dried prunes, assessment revenue during the 2004-05 crop year is

[[Page 50339]]

expected to be less than 1 percent of the total expected grower 
revenue.
    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 California dried prune industry and all 
interested persons were invited to attend the meeting and participate 
in Committee deliberations on all issues. Like all Committee meetings, 
the June 23, 2004, 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 California dried 
prune 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 20-day comment period is provided to allow interested persons to 
respond to this proposed rule. Twenty days is deemed appropriate 
because: (1) The 2004-05 crop year begins on August 1, 2004, and the 
marketing order requires that the rate of assessment for each crop year 
apply to all assessable prunes handled during such crop year; (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 
years.

List of Subjects in 7 CFR Part 993

    Marketing agreements, Plums, Prunes, Reporting and recordkeeping 
requirements.

    For the reasons set forth in the preamble, 7 CFR part 993 is 
proposed to be amended as follows:

PART 993--DRIED PRUNES PRODUCED IN CALIFORNIA

    1. The authority citation for 7 CFR part 993 continues to read as 
follows:

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

    2. Section 993.347 is revised to read as follows:


Sec.  993.347  Assessment rate.

    On and after August 1, 2004, an assessment rate of $4.00 per ton is 
established for California dried prunes.

    Dated: August 10, 2004.
A.J. Yates,
Administrator, Agricultural Marketing Service.
[FR Doc. 04-18611 Filed 8-13-04; 8:45 am]
BILLING CODE 3410-02-P