[Federal Register Volume 72, Number 9 (Tuesday, January 16, 2007)]
[Proposed Rules]
[Pages 1685-1688]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-425]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 946

[Docket No. AMS-FV-06-0177; FV06-946-1 PR]


Irish Potatoes Grown in Washington; Modification of 
Administrative Rules Governing Committee Representation

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule.

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SUMMARY: This rule invites comments on modifications to the 
administrative rules governing committee representation under the 
Washington potato marketing order. The marketing order regulates the 
handling of Irish potatoes grown in Washington, and is administered 
locally by the State of Washington Potato Committee (Committee). This 
rule would reestablish districts within the production area, 
reestablish the Committee with fewer members, and

[[Page 1686]]

reapportion members among districts. These changes would result in more 
efficient administration of the program while providing for more 
effective representation of the Washington fresh potato industry on the 
Committee.

DATES: Comments must be received by March 19, 2007.

ADDRESSES: Interested persons are invited to submit written comments 
concerning this proposal. 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. All comments should reference the 
docket number and the date and page number of this issue of the Federal 
Register and will be made 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 Hutchinson or Gary Olson, 
Northwest Marketing Field Office, Marketing Order Administration 
Branch, Fruit and Vegetable Programs, AMS, USDA; Telephone: (503) 326-
2724, Fax: (503) 326-7440, or E-Mail: [email protected] or 
[email protected].
    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 proposal is issued under Marketing 
Order No. 946, as amended (7 CFR part 946), regulating the handling of 
Irish potatoes grown in Washington, 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 proposal has been reviewed under Executive Order 12988, Civil 
Justice Reform. This rule is not intended to have retroactive effect. 
This proposal 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. A 
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 invites comments on proposed modifications to the 
administrative rules governing committee representation under the 
Washington potato marketing order. This rule would reestablish 
districts within the production area, reestablish the Committee with 
fewer members, and reapportion members among the new districts. 
Specifically, this rule would reestablish the order's five districts as 
three districts; decrease Committee membership from fifteen members and 
fifteen alternate members to nine members and nine alternate members; 
and reapportion the members such that one handler member and alternate 
member, and two producer members and their respective alternate members 
would be elected from each of the three reestablished districts. These 
changes would result in more efficient administration of the program 
while providing for more effective representation of the fresh potato 
industry on the Committee. The Committee unanimously recommended these 
changes at a meeting held on June 6, 2006, with a request that they be 
made effective on July 1, 2007.
    The order provides in Sec.  946.22 that USDA, upon recommendation 
of the Committee, may reestablish districts, may reapportion members 
among districts, may change the number of members and alternate 
members, and may change the composition by changing the ratio of 
members, including their alternates. In recommending any such changes, 
the order requires that the Committee consider the following: (1) 
Shifts in acreage within districts and within the production area 
during recent years; (2) the importance of new production in its 
relation to existing districts; (3) the equitable relationship between 
Committee apportionment and districts; and (4) other relevant factors.
    As previously noted, the Committee currently has fifteen members, 
with membership apportioned among five districts. Sections 946.31 and 
946.103 currently define the districts as follows:
    District No. 1--The counties of Ferry, Stevens, Pend Oreille, 
Spokane, Whitman, and Lincoln, plus the East Irrigation District of the 
Columbia Basin Project, plus the area of Grant County not included in 
either the Quincy or South Irrigation Districts which lies east of 
township vertical line R27E, plus the area of Adams County not included 
in either of the South or Quincy Irrigation Districts.
    District No. 2--The counties of Kittitas, Douglas, Chelan, and 
Okanogan, plus the Quincy Irrigation District of the Columbia Basin 
Project, plus the area of Grant County not included in the East or 
South Irrigation Districts which lies west of township line R28E.
    District No. 3--The counties of Benton, Klickitat, and Yakima.
    District No. 4--The counties of Walla Walla, Columbia, Garfield, 
and Asotin, plus the South Irrigation District of the Columbia Basin 
Project, plus the area of Franklin County not included in the South 
District.
    District No. 5--All of the remaining counties in the State of 
Washington not included in Districts No. 1, 2, 3, and 4 of this 
section.
    Further, Sec. Sec.  946.25 and 946.104 currently provide in part 
that each of the five districts are represented as follows: District 
No. 1: Three producer members and one handler member; District No. 2: 
Two producer members and one handler member; District No. 3: Two 
producer members and one handler member; District No. 4: Two producer 
members and one handler member; District No. 5: One producer member and 
one handler member.
    The Committee's districts were last reestablished on July 1, 1975, 
largely due to changes in the production area brought about by the 
Columbia Basin Project (CBP). The CBP is a large scale irrigation 
project administered by the Bureau of Reclamation, U.S. Department of 
Interior. The CBP is comprised of three irrigation districts centered 
in Grant County, Washington.
    The Committee's districts were originally established using county 
boundaries, whereas the 1975 redistricting process reestablished the 
districts by utilizing existing county and township lines, as well as 
the three irrigation districts formed under the CBP. As a consequence, 
the Committee utilized the CBP irrigation district

[[Page 1687]]

boundaries in redistricting. At the time, the boundaries of the three 
irrigation districts were well known to producers in the area. However, 
as more producers installed wells to irrigate their potatoes, the CBP 
irrigation district boundaries became less relevant.
    Also, the Committee reports that it is having difficulty recruiting 
members. This recruitment issue is largely due to a decreasing number 
of qualified individuals willing to take the time away from their 
families and farms to serve on the Committee.
    Finally, the Washington State Potato Commission (Commission), an 
agency of the State of Washington, has recently reestablished its 
production area into three districts. The Committee recommended 
reestablishing the order's districts to align with the Commission's new 
districts.
    After comparing current acreage and production statistics, as well 
as the current number of fresh potato producers in each of the order's 
five districts to statistics for the Commission's three new districts, 
the Committee found that reestablishment of its districts from five to 
three would not only be feasible, but could enhance the Committee's 
administration of the order. In considering the trend towards less 
industry participation on the Committee, as well as the decreasing 
relative size of the fresh potato producer population (the 5 year 
average fresh production is 13% of the total Washington potato 
production), the Committee also determined that it could more 
effectively serve the industry if it were to reestablish with as few as 
nine members.
    The Committee currently is comprised of ten producer members and 
five handler members and their respective alternates. The Committee 
felt that this ratio--two producer members to each handler member--
should also be used in reestablishing and reapportioning the Committee. 
Based on statistical information available from USDA, the Committee 
therefore determined that the reestablished Committee should be 
comprised of nine members--six producer members and three handler 
members--with two producer members and respective alternates, and one 
handler member and respective alternate representing each of the three 
new districts.
    In determining how to appropriately divide the production area into 
three districts, as well as the correct apportionment of nine members 
in three new districts, the Committee reviewed the relative differences 
in fresh production and acreage estimates in Washington's various 
potato producing counties. Using data from the USDA's National 
Agriculture Statistics Service (NASS), the Committee's research 
indicated that proposed District No. 1 would have 41 percent of the 
fresh potato producers, 36 percent of the fresh potato production, and 
32 percent of the fresh potato acreage in the order's production area. 
Proposed District No. 2 would have 31 percent of the producers, 43 
percent of the production, and 36 percent of the acreage. Finally, 
proposed District No. 3 would have 28 percent of the producers, 21 
percent of the production, and 32 percent of the acreage.
    Although these statistics show that the number of fresh potato 
farms and the related production figures are not evenly divided among 
the proposed districts, acreage figures are nearly equal. Additionally, 
the Committee reports that there are widely variable yields among the 
various table-stock potato varieties produced in Washington's diverse 
production areas. In equitably apportioning the proposed nine members 
among the three districts, the Committee chose not to provide districts 
that predominately produce a lower yielding variety of potato with less 
representation on the Committee. As previously noted, the Committee's 
recommendation therefore includes provision that two producer members 
and one handler member, as well as their respective alternates, would 
represent each district.
    The proposed districts would provide consistency in the Washington 
potato industry. All of Grant County would be located in the 
reestablished District No. 1 instead of being divided between Districts 
No. 1, 2 and 4, as is currently the case. As proposed in this rule, 
District No. 1 would consist of the counties of Douglas, Chelan, 
Okanogan, Grant, Adams, Ferry, Stevens, Pend Oreille, Spokane, Whitman, 
and Lincoln. District No. 2 would consist of the counties of Kittitas, 
Yakima, Klickitat, Benton, Franklin, Walla Walla, Columbia, Garfield, 
and Asotin. Finally, District No. 3 would consist of all the remaining 
counties in the State of Washington not included in Districts No. 1 and 
2 (essentially all of the counties west of the Cascade Mountains).

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 action 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 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 45 handlers of Washington potatoes subject 
to regulation under the order and approximately 267 potato producers in 
the regulated area. Small agricultural service firms are defined by the 
Small Business Administration (13 CFR 121.201) as those having annual 
receipts of less than $6,500,000, and small agricultural producers are 
defined as those having annual receipts of less than $750,000.
    During the 2005-2006 marketing year, 10,516,095 hundredweight of 
Washington potatoes were inspected under the order and sold into the 
fresh market. Based on an estimated average f.o.b. price of $7.80 per 
hundredweight, the Committee estimates that 43 handlers, or about 96 
percent, had annual receipts of less than $6,500,000.
    In addition, based on information provided by NASS, the average 
producer price for Washington potatoes for the 2005 marketing year (the 
most recent period that final statistics are available) was $5.60 per 
hundredweight. The average annual producer revenue for each of the 267 
Washington potato producers is therefore calculated to be approximately 
$220,562. In view of the foregoing, the majority of the handlers and 
producers of Washington potatoes may be classified as small entities.
    This rule would modify Sec. Sec.  946.103 and 946.104 of the 
order's administrative rules and regulations by reestablishing the 
order's districts from the current five districts to three districts, 
reestablishing the Committee with nine members rather than fifteen 
members, and reapportioning the membership such that each district is 
represented by two producers and one handler and their respective 
alternates. This rule would be effective July 1, 2007. Authority for 
reestablishing the districts, as well as reestablishing and 
reapportioning the Committee is provided in Sec.  946.22 of the order.
    The Committee believes that these proposed changes would not 
negatively impact handlers and producers in terms of cost. Costs for 
Committee meetings should actually decrease because of the reduction in 
the number of members and their respective alternates traveling

[[Page 1688]]

to meetings. Such savings could ultimately be passed on to handlers and 
producers in the form of reduced assessments. The benefits for this 
rule are not expected to be disproportionately greater or less for 
small handlers or producers than for larger entities.
    The Committee discussed various alternative reductions in Committee 
size and how to reapportion fewer members among the districts. 
Ultimately, the Committee determined that reducing its size to nine 
members would best mitigate the problems associated with recruitment of 
qualified members.
    Since this rule would modify the administrative rules governing 
committee representation by reestablishing districts, reestablishing 
the Committee, and reapportioning members among districts, additional 
reporting or recordkeeping requirements would not be imposed on either 
small or large potato handlers. The information collection requirements 
contained in this rule have been previously approved by the Office of 
Management and Budget under No. 0581-0178, Vegetable and Specialty 
Crops. 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. Furthermore, USDA 
has not identified any relevant Federal rules that duplicate, overlap 
or conflict with this proposed rule.
    AMS is committed to complying with the E-Government Act, to promote 
the use of the Internet and other information technologies to provide 
increased opportunities for citizen access to Government information 
and services, and for other purposes.
    The Committee's meeting was widely publicized throughout the 
Washington potato industry and all interested persons were invited to 
attend and participate in Committee deliberations on all issues. Like 
all Committee meetings, the February 9, 2006, 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.
    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 60-day comment period is provided to allow interested persons to 
respond to this proposal. All written comments timely received will be 
considered before a final determination is made on this matter.

List of Subjects in 7 CFR Part 946

    Marketing agreements, Potatoes, Reporting and recordkeeping 
requirements.

    For the reasons set forth in the preamble, 7 CFR part 946 is 
proposed to be amended as follows:

PART 946--IRISH POTATOES GROWN IN WASHINGTON

    1. The authority citation for 7 CFR part 946 continues to read as 
follows:

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

    2. Section 946.103 is revised to read as follows:


Sec.  946.103  Reestablishment of districts.

    Pursuant to Sec.  946.22, on and after July 1, 2007, the following 
districts are reestablished:
    (a) District No. 1--the counties of Douglas, Chelan, Okanogan, 
Grant, Adams, Ferry, Stevens, Pend Oreille, Spokane, Whitman, and 
Lincoln.
    (b) District No. 2--the counties of Kittitas, Yakima, Klickitat, 
Benton, Franklin, Walla Walla, Columbia, Garfield, and Asotin.
    (c) District No. 3--all of the remaining counties in the State of 
Washington, not included in Districts No. 1 and No. 2 of this 
paragraph.
    3. Section 946.104 is revised to read as follows:


Sec.  946.104  Reestablishment and Reapportionment of committee.

    (a) Pursuant to Sec.  946.22, on and after July 1, 2007, the State 
of Washington Potato Committee consisting of nine members, of whom six 
shall be producers and three shall be handlers, is hereby 
reestablished. For each member of the committee there shall be an 
alternate who shall have the same qualifications as the member.
    (b) Pursuant to Sec.  946.22, on and after July 1, 2007, membership 
representation of the State of Washington Potato Committee shall be 
reapportioned among the districts of the production area so as to 
provide that each of the three districts as defined in Sec.  946.103 
are represented by two producer members and one handler member and 
their respective alternates.

    Dated: January 9, 2007.
Lloyd C. Day,
Administrator, Agricultural Marketing Service.
[FR Doc. E7-425 Filed 1-12-07; 8:45 am]
BILLING CODE 3410-02-P