[Federal Register Volume 69, Number 205 (Monday, October 25, 2004)]
[Rules and Regulations]
[Pages 62177-62179]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-23826]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Parts 922 and 923

[Docket No. FV04-922-1 FIR]


Decreased Assessment Rates for Specified Marketing Orders

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

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SUMMARY: The Department of Agriculture (USDA) is adopting, as a final 
rule, without change, an interim final rule which decreased 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 final 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 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: November 24, 2004.

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.''
    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 continues to decrease 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

[[Page 62178]]

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 was to continue 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 previously 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 was to continue 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 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 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.

Final 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 final 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 this, the majority of the apricot producers 
and handlers may be classified as small entities.
    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

[[Page 62179]]

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 foregoing, the majority of Washington cherry producers and 
handlers may be classified as small entities.
    This rule continues to decrease 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 periods 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 information pertaining to 
the 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 continues to decrease 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 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.
    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.
    The interim final rule concerning this action was published in the 
Federal Register on July, 29, 2004 (69 FR 45233). Copies of that rule 
were also mailed or sent via facsimile to all Committee members. 
Finally, the interim final rule was made available through the Internet 
by USDA and the Office of the Federal Register. A 60-day comment period 
was provided for interested persons to respond to the interim final 
rule. The comment period ended on September 27, 2004. One comment was 
received during that period. The commenter questioned the 
understandability of the rule. The comment did not address the 
substance of the interim final rule. We believe that the rule is clear 
and understandable. Thus, no changes are made as a result of this 
comment.
    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.

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.

PART 922--APRICOTS GROWN IN DESIGNATED COUNTIES IN WASHINGTON

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

0
Accordingly, the interim final rule amending 7 CFR parts 922 and 923 
which was published at 69 FR 45233 on July 29, 2004, is adopted as a 
final rule without change.

    Dated: October 19, 2004.
A.J. Yates,
Administrator, Agricultural Marketing Service.
[FR Doc. 04-23826 Filed 10-22-04; 8:45 am]
BILLING CODE 3410-02-P