[Federal Register Volume 70, Number 147 (Tuesday, August 2, 2005)]
[Rules and Regulations]
[Pages 44249-44252]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-15169]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 923

[Docket Nos. AO-F&V-923-3 FV03-923-01 FR]


Sweet Cherries Grown in Designated Counties in Washington; Order 
Amending Marketing Order No. 923

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

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SUMMARY: This rule amends the marketing order (order) for sweet 
cherries grown in Washington. Sweet cherry growers, voting in a mail 
referendum held March 1 through March 21, 2005, voted on four 
amendments proposed by the Washington Cherry Marketing Committee 
(Committee), which is responsible for local administration of the 
order, and two amendments proposed by the Agricultural Marketing 
Service of USDA. Of the six amendments proposed, three were favored, 
including: Adding authority for the Committee to accept voluntary 
contributions for research and promotion; establishing tenure 
limitations for Committee members; and requiring that continuance 
referenda be conducted every 6 years. The three amendments that failed 
include: adding authority for promotion, including paid advertising, 
and production research projects; adding authority for supplemental 
rates of assessment for individual varieties of cherries; and, adding a 
public member to the Committee. These amendments will not be 
implemented.

EFFECTIVE DATE: This rule is effective August 3, 2005.

FOR FURTHER INFORMATION CONTACT: Melissa Schmaedick, Marketing Order 
Administration Branch, Fruit and Vegetable Programs, Agricultural 
Marketing Service, USDA, Post Office Box 1035, Moab, UT 84532, 
telephone: (435) 259-7988, fax: (435) 259-4945; or Robert J. Curry, 
Marketing Order Administration Branch, Fruit and Vegetable Programs, 
AMS, USDA, Northwest Marketing Field Office, 1220 SW., Third Avenue, 
Room 385, Portland, OR 97204; telephone (503) 326-2724 or Fax (503) 
326-7440.
    Small businesses may request information on this proceeding 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: Prior documents in this proceeding include: 
Notice of Hearing issued on October 6, 2003, and published in the 
October 10, 2003, issue of the Federal Register (68 FR 58636); 
Recommended Decision issued on September 29, 2004 and published in the 
October 5, 2004 issue of the Federal Register (69 FR 59551); and a 
Secretary's Decision and Referendum Order issued January 11, 2005 and 
published in the Federal Register on January 14, 2005 (70 FR 2573).
    This administrative action is governed by the provisions of 
sections 556 and 557 of title 5 of the United States Code and is 
therefore excluded from the requirements of Executive Order 12866.

Preliminary Statement

    This final rule was formulated on the record of a public hearing 
held November 18, 2003, in Yakima, Washington. Notice of the public 
hearing was issued on October 6, 2003, and published in the October 10, 
2003, issue of the Federal Register (68 FR 58636). The hearing was held 
to consider the proposed amendment of Marketing Agreement and Order No. 
923, regulating the handling of sweet cherries grown in the State of 
Washington, hereinafter referred to as the ``order''. The hearing was 
held pursuant to the provisions of the Agricultural Marketing Agreement 
Act of 1937, as amended (7 U.S.C. 601 et seq.), hereinafter referred to 
as the ``Act,'' and the applicable rules of practice and procedure 
governing the formulation of marketing agreements and marketing orders 
(7 CFR part 900). The Notice of Hearing contained six proposals: four 
proposals submitted by the Committee and two proposals by the

[[Page 44250]]

Agricultural Marketing Committee (AMS).
    Upon the basis of evidence introduced at the hearing and the record 
thereof, the Administrator of AMS on September 29, 2004, filed with the 
Hearing Clerk, U.S. Department of Agriculture, a Recommended Decision 
and Opportunity to File Written Exceptions thereto by November 4, 2004. 
No comments or exceptions were filed.
    A Secretary's Decision and Referendum Order was issued on January 
11, 2005, directing that a referendum be conducted during the period 
March 1 through March 25, 2005, among growers of sweet cherries to 
determine whether they favored the proposed amendments to the order. 
Voters voting in the referendum favored three out of the six amendments 
proposed by the Committee and USDA.
    The amendments favored by the voters and included in this order 
will:
    1. Add authority for the Committee to accept voluntary 
contributions for production research, marketing research and 
promotion. Any voluntary contributions received under this new 
authority may be used to support marketing research and development 
projects designed to assist, improve or promote the marketing, 
distribution, and consumption of sweet cherries. Voluntary 
contributions may not, however, be used for production research or paid 
advertising, as the authority to conduct such activities under the 
order was not approved in the referendum.
    2. Impose term limitations on Committee members. Upon 
implementation, Committee members will be limited to serving no more 
than three consecutive two-year terms in one position without a break 
in service.
    3. Require that continuance referenda be held every 6 years among 
Washington sweet cherry producers to determine their support for 
continuation of their marketing order program.
    The proposals to add authority for production research and paid 
advertising, additional rates of assessments for individual varieties 
of cherries and a public member to the committee, failed to obtain the 
requisite number of votes needed, in number or in volume, to pass.
    To become effective, the amendments had to be approved by at least 
two-thirds of those producers voting or by voters representing at least 
two-thirds of the volume of sweet cherries represented by voters voting 
in the referendum.
    AMS also proposed to allow such changes as may be necessary to the 
order so that all of the order's provisions conform to the effectuated 
amendments. None were deemed necessary.

Small Business Considerations

    Pursuant to the 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, the 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 so that small businesses will not be 
unduly or disproportionately burdened. Small agricultural growers have 
been defined by the Small Business Administration (SBA) (13 CFR 
121.201) as those having annual receipts of less than $750,000. Small 
agricultural service firms are defined as those with annual receipts of 
less than $6,000,000.
    The record shows that there are approximately 1,500 growers of 
sweet cherries in the production area and approximately 62 handlers 
subject to regulation under the order. The average production of sweet 
cherries in Washington State for the last three years is 64,676 tons 
with an average grower price of $1,943 per ton. Using this number, the 
average annual grower revenue is calculated to be approximately 
$83,777, thus indicating that the average Washington sweet cherry 
grower would qualify as a small entity according to the SBA definition.
    Using Committee data regarding each individual handler's total 
shipments during the 2002 marketing year, and an estimated average FOB 
price of $24 per 20-pound container, 79 percent of the Washington sweet 
cherry handlers shipped under $5 million worth of sweet cherries, and 
21 percent shipped over $5 million worth of sweet cherries. Therefore, 
the majority of Washington sweet cherry handlers may be classified as 
small entities.
    At a May 22, 2003, full Committee meeting, all industry 
representatives present could present their views concerning the 
recommended amendments. Both large and small businesses were 
represented. The Committee believes that small and large entities will 
benefit equally from the amendments.
    This final rule amends Sec.  923.43 of the order to authorize 
acceptance of voluntary contributions. The proposal to add authority 
for the Committee to accept voluntary contributions will not result in 
any increased costs or burdens to the industry. In fact, witnesses 
stated that this authority will benefit the industry greatly as it 
could provide for additional funding sources for research activities. 
Safeguards against donor control over the use of voluntary 
contributions will ensure that these funds will be used in the best 
interest of the industry. The Committee will decide how to use those 
funds, and the decision-making process will be open to industry input 
and feedback.
    This final rule amends Sec.  923.21 of the order to authorize term 
limits. The amendment to add tenure requirements for Committee members 
will allow more persons the opportunity to serve as members of the 
Committee. It will provide for more diverse membership, provide the 
Committee with new perspectives and ideas, and increase the number of 
individuals in the industry with Committee experience.
    This final rule amends Sec.  923.64 of the order to authorize 
continuance referenda. The amendment to require continuance referenda 
on a periodic basis to ascertain grower support for the order will 
allow growers to vote on whether to continue the operation of the 
program. The referenda will be conducted by USDA.
    Interested persons were invited to present evidence at the hearing 
on the probable regulatory and informational impacts of the proposed 
amendments to the order on small entities. The record evidence is that 
while some minimal costs may occur, those costs are expected to be 
outweighed by the benefits expected to accrue to the sweet cherry 
industry in designated counties of Washington.

Paperwork Reduction Act

    In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 
Chapter 35), any reporting and recordkeeping provision changes that 
would be generated by these amendments would be submitted to the Office 
of Management and Budget (OMB). Current information collection 
requirements for Part 923 are approved by OMB under the generic Fruit 
Crops package OMB number 0581-0189.
    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 proposed rule. These amendments are 
designed to enhance the administration and functioning of the marketing 
order to the benefit of the industry.
    Committee meetings regarding these proposals as well as the hearing 
dates were widely publicized throughout the

[[Page 44251]]

Washington sweet cherry industry, and all interested persons were 
invited to attend the meetings and the hearing and participate in 
Committee deliberations on all issues. All Committee meetings and the 
hearing were public forums and all entities, both large and small, were 
able to express views on these issues.

Civil Justice Reform

    The amendments contained in this rule have been reviewed under 
Executive Order 12988, Civil Justice Reform. They are not intended to 
have retroactive effect. These amendments will not preempt any State or 
local laws, regulations, or policies, unless they present an 
irreconcilable conflict with this proposal.
    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 the Department 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 
there from. A handler is afforded the opportunity for a hearing on the 
petition. After the hearing, the 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 the 
Department's ruling on the petition, provided an action is filed not 
later than 20 days after the date of the entry of the ruling.

Order Amending the Order Regulating Sweet Cherries Grown in Washington

Findings and Determinations
    The findings and determinations set forth hereinafter are 
supplementary and in addition to the findings and determination 
previously made in connection with the issuance of the order; and all 
of said previous findings and determinations are hereby ratified and 
affirmed, except as such findings and determinations may be in conflict 
with the findings and determinations set forth herein.
    (a) Findings and Determinations Upon the Basis of the Hearing 
Record.
    Pursuant to the provisions of the Agricultural Marketing Agreement 
Act of 1937, as amended (7 U.S.C. 601 et seq.) and the applicable rules 
of practice and procedure effective thereunder (7 CFR part 900), a 
public hearing was held upon the proposed amendments to Marketing Order 
No. 923 (7 CFR part 923), regulating the handling of sweet cherries 
grown in Washington.
    Upon the basis of the evidence introduced at such hearing and the 
record thereof it is found that:
    (1) The marketing order, as amended, and as hereby further amended, 
and all of the terms and conditions thereof, will tend to effectuate 
the declared policy of the Act;
    (2) The marketing order, as amended, and as hereby further amended, 
regulates the handling of sweet cherries grown in the production area 
in the same manner as, and is applicable only to persons in the 
respective classes of commercial and industrial activity specified in 
the marketing order upon which hearings have been held;
    (3) The marketing order, as amended, and as hereby further amended, 
is limited in application to the smallest regional production area 
which is practicable, consistent with carrying out the declared policy 
of the Act, and the issuance of several orders applicable to 
subdivision of the production area would not effectively carry out the 
declared policy of the Act;
    (4) The marketing order, as amended, and as hereby further amended, 
prescribes, insofar as practicable, such different terms applicable to 
different parts of the production area as are necessary to give due 
recognition to the differences in the production and marketing of sweet 
cherries grown in the production area; and
    (5) All handling of sweet cherries grown in the production area is 
in the current of interstate or foreign commerce or directly burdens, 
obstructs, or affects such commerce.
    (b) Additional findings. It is necessary and in the public interest 
to make the amendments to this order effective not later than one day 
after publication in the Federal Register. A later effective date would 
unnecessarily delay implementation of the approved changes, which are 
expected to benefit the Washington sweet cherry industry. Immediate 
implementation of the amendments is necessary in order to make the 
amendments effective as specified.
    In view of the foregoing, it is hereby found and determined that 
good cause exists for making these amendments effective one day after 
publication in the Federal Register, and that it would be contrary to 
the public interest to delay the effective date for 30 days after 
publication in the Federal Register (Sec. 553(d), Administrative 
Procedure Act; 5 U.S.C. 551-559).
    (c) Determinations. It is hereby determined that:
    (1) Handlers (excluding cooperative associations of producers who 
are not engaged in processing, distributing, or shipping sweet cherries 
covered by the order as hereby amended) who, during the period April 1, 
2004, through February 28, 2005, handled 50 percent or more of the 
volume of such sweet cherries covered by said order, as hereby amended, 
have not signed an amended marketing agreement;
    (2) The issuance of this amendatory order, further amending the 
aforesaid order, is favored or approved by at least two-thirds of the 
producers who participated in a referendum on the question of approval 
and who, during the period of April 1, 2004, through February 28, 2005 
(which has been deemed to be a representative period), have been 
engaged within the production area in the production of such sweet 
cherries, such producers having also produced for market at least two-
thirds of the volume of such commodity represented in the referendum; 
and
    (3) In the absence of a signed marketing agreement, the issuance of 
this amendatory order is the only practical means pursuant to the 
declared policy of the Act of advancing the interests of producers of 
sweet cherries in the production area.

Order Relative To Handling of Sweet Cherries Grown in Washington

    It is therefore ordered, that on and after the effective date 
hereof, all handling of sweet cherries grown in Washington shall be in 
conformity to, and in compliance with, the terms and conditions of the 
said order as hereby amended as follows:
    The provisions of proposals 3, 5 and 6 of the proposed order 
amending the order contained in the Recommended Decision issued by the 
Administrator on September 29, 2004, and published in the Federal 
Register on October 5, 2004, shall be and are the terms and provisions 
of this order amending the order and set forth in full herein.

List of Subjects in 7 CFR Part 923

    Cherries, Marketing agreements, Reporting and recordkeeping 
requirements.


0
For the reasons set out it the preamble, 7 CFR part 923 is amended as 
follows:

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

0
1. The authority citation for 7 CFR part 923 continues to read as 
follows:

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


[[Page 44252]]



0
2. Section 923.21 is revised to read as follows:


Sec.  923.21  Term of office.

    The term of office of each member and alternate member of the 
committee shall be for two years beginning April 1 and ending March 31. 
Members and alternate members shall serve in such capacities for the 
portion of the term of office for which they are selected and have 
qualified and until their respective successors are selected and have 
qualified. Committee members shall not serve more than three 
consecutive terms. Members who have served for three consecutive terms 
must leave the committee for at least one year before becoming eligible 
to serve again.


0
3. A new Sec.  923.43 is added to read as follows:


Sec.  923.43  Contributions.

    The committee may accept voluntary contributions but these shall 
only be used to pay expenses incurred pursuant to Sec.  923.45. 
Furthermore, such contributions shall be free from any encumbrances by 
the donor and the committee shall retain complete control of their use.


0
4. Section 923.64 is amended by:
0
A. Revising paragraph (c).
0
B. Redesignating paragraph (d) as paragraph (e).
0
C. Adding a new paragraph (d).
    The revisions read as follows:


Sec.  923.64  Termination.

* * * * *
    (c) The Secretary shall terminate the provisions of this part 
whenever it is found that such termination is favored by a majority of 
growers who, during a representative period, have been engaged in the 
production of cherries: Provided, that such majority has, during such 
representative period, produced for market more than 50 percent of the 
volume of such cherries produced for market.
    (d) The Secretary shall conduct a referendum six years after the 
effective date of this section and every sixth year thereafter, to 
ascertain whether continuance of this subpart is favored by growers. 
The Secretary may terminate the provisions of this subpart at the end 
of any fiscal period in which the Secretary has found that continuance 
of this subpart is not favored by growers who, during a representative 
period determined by the Secretary, have been engaged in the production 
of cherries in the production area.
* * * * *

    Dated: July 27, 2005.
Kenneth C. Clayton,
Acting Administrator, Agricultural Marketing Service.
[FR Doc. 05-15169 Filed 8-1-05; 8:45 am]
BILLING CODE 3410-02-P