[Federal Register Volume 70, Number 122 (Monday, June 27, 2005)]
[Rules and Regulations]
[Pages 36814-36816]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-12619]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 948

[Docket No. FV05-948-2 IFR]


Irish Potatoes Grown in Colorado; Decreased Assessment Rate

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Interim final rule with request for comments.

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SUMMARY: This rule decreases the assessment rate established for the 
Area No. 3 Colorado Potato Administrative Committee (Committee) for the 
2005-2006 and subsequent fiscal periods from $0.03 to $0.02 per 
hundredweight of potatoes. The Committee locally administers the 
marketing order which regulates the handling of potatoes grown in 
Colorado. Authorization to assess Colorado potato handlers enables the 
Committee to incur expenses that are reasonable and necessary to 
administer the program. The fiscal period begins July 1 and ends June 
30. The assessment rate will remain in effect indefinitely unless 
modified, suspended, or terminated.

DATES: Effective June 28, 2005. Comments received by August 26, 2005, 
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 
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 No. 97 and Marketing Order No. 948, both as amended (7 CFR 
part 948), regulating the handling of potatoes grown in Colorado, 
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, Colorado 
potato handlers are subject to assessments. Funds to administer the 
order are derived from such assessments. It is intended that the 
assessment rate as issued herein will be applicable to all assessable 
Colorado potatoes beginning July 1, 2005, 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

[[Page 36815]]

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 rate established for the 
Committee for the 2005-2006 and subsequent fiscal periods from $0.03 to 
$0.02 per hundredweight of Colorado potatoes.
    The 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 Colorado potatoes. 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 2003-2004 and subsequent fiscal periods, the Committee 
recommended, and USDA approved, an assessment rate of $0.03 per 
hundredweight of potatoes 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 Committee or other information available to USDA.
    The Committee met on May 12, 2005, and unanimously recommended 
2005-2006 expenditures of $20,368 and an assessment rate of $0.02 per 
hundredweight of assessable potatoes handled. In comparison, last 
year's budgeted expenditures were $20,668. The assessment rate of $0.02 
is $0.01 lower than the rate in effect since the 2003-2004 fiscal 
period. Due to increased potato yields and a reduction in expenses, the 
Committee's reserve has increased more than anticipated. The decreased 
assessment rate will allow the Committee to draw from the reserve to 
help cover 2005-2006 expenditures. This action should effectively lower 
the reserve to within the program limit of approximately two fiscal 
periods' operational expenses.
    The major expenditures recommended by the Committee for the 2005-
2006 fiscal period include $8,610 for salary, $3,000 for office rent, 
$1,750 for office expenses, and $1,000 for utilities. These budgeted 
expenses are the same as those approved for the 2004-2005 fiscal 
period.
    The assessment rate recommended by the Committee was derived by 
dividing anticipated expenses by expected shipments of Colorado 
potatoes. Applying the $0.02 per hundredweight rate of assessment to 
the Committee's 585,475 hundredweight crop estimate should provide 
$11,709 in assessment income. Income derived from handler assessments, 
along with interest income and funds from the Committee s authorized 
reserve, will be adequate to cover budgeted expenses. Funds in the 
reserve ($42,792 as of July 1, 2004) will be kept within the maximum of 
approximately two fiscal periods' operational expenses as authorized by 
the order (Sec.  948.78).The assessment rate established in this rule 
will 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 is effective for an indefinite 
period, the Committee will continue to meet prior to or during each 
fiscal period 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 will 
be undertaken as necessary. The Committee's 2005-2006 budget 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.
    Based on Committee data, there are 8 producers and 8 handlers in 
the production area subject to regulation under the order. 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 $6,000,000.
    Based on the total number of Colorado Area No. 3 potato producers 
(8), 2003 fresh potato production of 1,041,958 hundredweight (Committee 
records), and the average 2003 producer price of $5.05 per 
hundredweight as reported by National Agricultural Statistics Service 
(NASS), average annual revenue per producer from the sale of potatoes 
can be estimated at approximately $657,736. In addition, based on 
Committee records and an estimated average 2003 f.o.b. price of $7.15 
per hundredweight ($5.05 per hundredweight NASS producer price plus 
Committee estimated packing and handling costs of $2.10 per 
hundredweight), all of the Colorado Area No. 3 potato handlers ship 
under $6,000,000 worth of potatoes. In view of the foregoing, it can be 
concluded that the majority of the Colorado Area No. 3 potato producers 
and handlers may be classified as small entities.
    This rule decreases the assessment rate established for the 
Committee and collected from handlers for the 2005-2006 and subsequent 
fiscal periods from $0.03 to $0.02 per hundredweight of potatoes. The 
assessment rate of $0.02 is $0.01 less than the 2004-2005 rate. The 
quantity of assessable potatoes for the 2005-2006 fiscal period is 
estimated at 585,475 hundredweight. Income derived from handler 
assessments, along with interest income and funds from the Committee's 
authorized reserve, will be adequate to cover budgeted expenses. Funds 
in the reserve ($42,792 as of July 1, 2004) will be kept within the 
maximum of approximately two fiscal periods' operational expenses as 
authorized by the order (Sec.  948.78).
    The major expenditures recommended by the Committee for the 2005-
2006 fiscal period include $8,610 for salary, $3,000 for office rent, 
$1,750 for office expenses, and $1,000 for utilities. These budgeted 
expenses are the same as those approved for the 2004-2005 fiscal 
period.
    Due to increased potato yields and a reduction in expenses, the 
Committee's reserve has increased more than anticipated. Therefore, the 
Committee recommended a decreased assessment rate to enable an 
increased draw on the reserve, thus maintaining the level of the 
reserve within program limits of approximately two fiscal periods' 
operational expenses.

[[Page 36816]]

    The Committee 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 
program.
    A review of historical information and preliminary information 
pertaining to the upcoming crop year indicates that the producer price 
for the 2005-2006 season could range between $5.05 and $7.75 per 
hundredweight. Therefore, the estimated assessment revenue for the 
2005-2006 fiscal period as a percentage of total producer revenue could 
range between 0.40 and 0.26 percent.
    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 rate reduces the burden on handlers, and may reduce the 
burden on producers. In addition, the Committee's meeting was widely 
publicized throughout the Colorado potato industry and all interested 
persons were invited to attend and participate in the Committee's 
deliberations on all issues. Like all Committee meetings, the May 12, 
2005, meeting was a public meeting 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 Colorado potato 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 Committee 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 2005-2006 fiscal period begins on July 1, 
2005, and the order requires that the rate of assessment apply to all 
assessable Colorado potatoes handled during such fiscal period; (2) 
this action decreases the assessment rate for assessable potatoes 
beginning with the 2005-2006 fiscal period; (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; 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 in 7 CFR Part 948

    Marketing agreements, Potatoes, Reporting and recordkeeping 
requirements.

0
For the reasons set forth in the preamble, 7 CFR part 948 is amended as 
follows:

PART 948--IRISH POTATOES GROWN IN COLORADO

0
1. The authority citation for 7 CFR part 948 continues to read as 
follows:

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


0
2. Section 948.215 is revised to read as follows:


Sec.  948.215  Assessment rate.

    On or after July 1, 2005, an assessment rate of $0.02 per 
hundredweight is established for Colorado Area No. 3 potatoes.

    Dated: June 20, 2005.
Kenneth C. Clayton,
Acting Administrator, Agricultural Marketing Service.
[FR Doc. 05-12619 Filed 6-24-05; 8:45 am]
BILLING CODE 3410-02-P