[Federal Register Volume 72, Number 61 (Friday, March 30, 2007)]
[Proposed Rules]
[Pages 15056-15063]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-5792]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 915

[Docket No. AO-254-A10; AMS-FV-06-0220; FV06-915-2]


Avocados Grown in South Florida; Recommended Decision on Proposed 
Amendments of Marketing Order No. 915

AGENCY: Agricultural Marketing Service (AMS), USDA.

ACTION: Proposed rule and opportunity to file exceptions.

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SUMMARY: This is a recommended decision regarding proposed

[[Page 15057]]

amendments to Marketing Order No. 915 (order), which regulates the 
handling of avocados grown in Florida. The amendments were proposed by 
the Florida Avocado Administrative Committee (Committee), which is 
responsible for local administration of the order. The amendments 
included in this recommended decision would: add authority for the 
Committee to borrow funds; revise voting requirements for changing the 
assessment rate; allow for District 1 nominations to be conducted by 
mail; and add authority for the Committee to accept voluntary 
contributions. The proposed amendments are intended to improve the 
operation and functioning of the marketing order program. This 
recommended decision invites written exceptions on the proposed 
amendments. This rule also announces AMS's intention to request 
approval by the Office of Management and Budget (OMB) of a new 
information collection.

DATES: Written exceptions must be filed by April 30, 2007. Pursuant to 
the Paperwork Reduction Act, comments on the information collection 
burden must be received by May 29, 2007.

ADDRESSES: Written exceptions should be filed with the Hearing Clerk, 
U.S. Department of Agriculture, room 1081-S, Washington, DC 20250-9200, 
Fax: (202) 720-9776 or via the Internet at http://www.regulations.gov. 
All comments should reference the docket number and the date and page 
number of this issue of the Federal Register. Comments will be made 
available for public inspection in the Office of the Hearing Clerk 
during regular business hours, or can be viewed at: http://www.regulations.gov.

FOR FURTHER INFORMATION CONTACT: Marc McFetridge or Melissa Schmaedick, 
Marketing Specialists, Fruit and Vegetable Programs, Marketing Order 
Administration Branch (MOAB), AMS, USDA, 1400 Independence Ave. SW., 
Washington, DC 20250-0237; Telephone: (202) 720-2491, Fax: (202) 720-
8938, or e-mail: [email protected] or 
[email protected].
    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, e-mail: [email protected].

SUPPLEMENTARY INFORMATION: Prior documents in this proceeding: Notice 
of Hearing issued on July 18, 2006, and published in the July 24, 2006 
issue of the Federal Register (71 FR 41740).
    This 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

    Notice is hereby given of the filing with the Hearing Clerk of this 
recommended decision with respect to the proposed amendments to 
Marketing Order 915 regulating the handling of avocados grown in 
Florida, and the opportunity to file written exceptions thereto. Copies 
of this decision can be obtained from Marc McFetridge whose address is 
listed above.
    This recommended decision is issued 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 orders (7 CFR part 900).
    The proposed amendments are based on the record of a public hearing 
held August 16, 2006, in Homestead, Florida. Notice of this hearing was 
published in the Federal Register on July 24, 2006 (71 FR 41740). The 
notice of hearing contained proposals submitted by the Committee.
    The proposed amendments are the result of the Committee's review of 
the order. The Committee met several times in 2005 and drafted proposed 
amendments to the order and presented them at industry meetings. The 
proposed amendments were then unanimously approved by the Committee. 
The amendments are intended to streamline organization and 
administration of the marketing order program. The Committee's request 
for a public hearing was submitted to the USDA on May 1, 2006.
    The Committee's proposed amendments to the order are summarized 
below:
    1. Amend the order to provide the Committee authority to borrow 
funds. This proposal would amend Sec.  915.41, Assessments.
    2. Amend the order by revising the voting requirements for changing 
the assessment rate. This change would remove the current voting 
requirement for rate increases above $0.20 per bushel that provides for 
a quorum of eight Committee members and eight concurring votes for 
approval. The new voting requirement would be applicable to all 
assessment rate increases and would provide for a quorum of seven 
Committee members and a two-thirds majority vote of those in attendance 
for approval. This proposal would amend Sec.  915.30, Procedure.
    3. Amend the order to allow District 1 nominations to be conducted 
by mail. District 2 nomination procedures already provide that 
authority. This proposal would amend Sec.  915.22, Nomination.
    4. Add authority to the order for the Committee to accept voluntary 
contributions. This proposal would add a new Sec.  915.43, 
Contributions.
    USDA also proposes to make changes to the order as may be 
necessary, if any of the proposed changes are adopted, so that all of 
the order's provisions conform to the effectuated amendments.
    Nine industry witnesses testified at the hearing. These witnesses 
represented fresh avocado producers and handlers in the production 
area. All of the witnesses testified in support of the proposed 
amendments to the order.
    Industry witnesses addressed the need for adding authority to 
borrow funds. Witnesses indicated that multiple years of weather-
related disasters have led to economic hardships for the Florida 
avocado industry and, as a result, lower assessment collections to fund 
the administrative costs of the Committee. The authority to borrow 
funds would enable the Committee access to an additional source for 
cash flow in addition to assessments, thereby providing the Committee 
with flexibility in covering their operational costs during times of 
economic hardship.
    Industry witnesses stated their support for revising the voting 
requirements for changing the assessment rate. This amendment would 
remove the current voting requirement for rate increases above $0.20 
per bushel that provides for a quorum of eight Committee members and 
eight concurring votes for approval. The new voting requirement would 
be applicable to all assessment rate increases and would provide for a 
quorum of seven Committee members and a two-thirds majority vote of 
those in attendance for approval. Revising these voting requirements 
would allow the Committee to become more flexible in responding to 
budgetary emergencies due to economic fluctuations in the avocado 
industry.
    Witnesses also supported the proposal to allow for District 1 
nominations to be conducted by mail. While the authority already exists 
to conduct nominations in District 2 by mail, voters in District 1 are 
required to travel to nomination meetings to cast their vote in 
District 1. Many witnesses cited grower reluctance to attend these 
meetings because of

[[Page 15058]]

travel related expenses and lost wages due to time away from the 
workplace. Thus, voter participation in District 1 nominations has been 
consistently lower compared to those held in District 2. Witnesses 
stated that this proposal would broaden grower participation in the 
Committee nominations for District 1.
    Lastly, industry witnesses testified in support of adding authority 
to accept voluntary contributions. According to the record, the 
authority to accept voluntary contributions would enable the Committee 
access to an additional source of revenue besides assessments. Some 
witnesses stated that voluntary contributions could also eliminate the 
need to raise the assessment rate and could support Committee research 
and development activities.
    At the conclusion of the hearing, the Administrative Law Judge 
stated that the final date for interested persons to file proposed 
findings and conclusions or written arguments and briefs based on the 
evidence received at the hearing would be 30 days after USDA's posting 
of the hearing record transcript. The transcript was posted on 
September 13, 2006. Therefore, the briefing period ended October 13, 
2006. One brief was filed. The brief stated a need for a technical 
change to Sec.  915.11. The brief noted that the name of Dade County 
has changed to Miami-Dade County. This correction has been incorporated 
as a technical change throughout this amendatory proceeding.

Material Issues

    The material issues presented on the record of hearing are as 
follows:
    (1) Whether to add authority to borrow funds;
    (2) Whether to revise the voting requirements for changing the 
assessment rate;
    (3) Whether to allow for District 1 nominations to be conducted by 
mail; and
    (4) Whether to add authority to accept voluntary contributions.

Findings and Conclusions

    The following findings and conclusions on the material issues are 
based on evidence presented at the hearing and the record thereof.

Material Issue Number 1--Authority to Borrow Funds

    Section 915.41, Assessments, should be amended to provide the 
Committee with authority to borrow funds. Any such funds would be 
limited for use by the Committee to meet its administrative 
responsibilities under the order during times of economic hardship and 
would be subject to prior approval by USDA.
    Under the current definition of the order, the Committee does not 
have the authority to borrow funds. Witnesses explained that without 
the authority to borrow funds or access to other non-assessment 
resources, the Committee is reliant on production-related revenue to 
fund its administrative operations.
    According to the record, multiple years of weather related-
disasters have resulted in lower assessment collections due to heavy 
losses of crops and production capacity. As a result, the Committee has 
relied on its financial reserves to continue its administrative 
operations. After more than five years of consecutive weather damage 
and low assessment collections, the Committee has depleted its 
reserves. Witnesses stated that the authority to borrow funds would be 
essential to the Committee's ability to continue operations during any 
future times of economic hardship.
    As an example, witnesses cited USDA's grant of special emergency, 
short-term authority to borrow funds during fiscal year 2005-2006. It 
was indicated that without those borrowed funds, the Committee would 
not have been able to continue to operate. The Committee has since 
repaid its loan, and witnesses stated that the borrowed funds were 
critical to the Committee's ability to continue functioning during that 
time.
    If implemented, the authority to borrow funds would be limited to 
use by the Committee to meet its administrative responsibilities under 
the order only during times of economic hardship. According to record 
evidence, the Committee's ability to borrow funds would be based on the 
financial history and assets of the Committee. If a loan, or a line of 
credit, for example, were approved, the Committee would be required to 
repay the loan by the end of the fiscal year in which the funds were 
borrowed. Loans could be renewed for the following fiscal year and 
would be subject to USDA oversight as part of the Committee's annual 
budgetary process. Witnesses explained that any interest incurred on 
the loan would be offset by the benefit of allowing the Committee to 
finance its operations.
    Based on record evidence, USDA recommends modifying the language 
for this proposed amendment to clarify that the authority to borrow 
funds would only be used in emergency situations, on a short-term basis 
and to meet financial obligations as those obligations occur, or to 
allow the Committee to adjust its reserve funds to meet such 
obligations. In addition, the language should be clarified to specify 
that any borrowing activities of the Committee would be subject to 
prior review and approval by USDA. These clarifying changes have been 
incorporated in the amendatory text section of this recommended 
decision.
    It is recommended that the order be amended to provide the 
Committee with authority to borrow funds. Without access to additional 
funds during times of economic hardship the Committee may not be able 
to meet their administrative responsibilities. The amount of the loan 
would be based on the financial history of the assessments collected by 
the Committee and would be repaid by the end of the fiscal year with 
the possibility for renewal. Any such loan would require prior approval 
by USDA.
    For the reasons outlined above, Sec.  915.41 should be amended to 
provide the Committee the authority to borrow funds, subject to USDA 
approval. USDA recommends modifying the amendatory text of this 
proposal so that the authority to borrow funds would only be used in 
emergency, short-term situations, and that such authority would be 
subject to USDA's prior approval. There was no opposition testimony on 
this issue.

Material Issue Number 2--Revision of the Voting Requirements for 
Committee Recommendations To Increase the Assessment Rate

    Section 915.30, Procedures, should be amended to revise the voting 
requirements for Committee recommendations for assessment rate changes 
above $0.20 per bushel. This change would remove the current voting 
requirement for rate increases above $0.20 per bushel provides for a 
quorum of eight Committee members and eight concurring votes for 
approval. The new voting requirement would be applicable to all 
assessment rate increases and would provide for a quorum of seven 
Committee members and a two-thirds majority vote of those in attendance 
for approval.
    The avocado marketing order provides authority for the Committee, 
with approval of USDA, to formulate an annual budget of expenses and 
collect assessments from handlers to administer the program. The 
members of the Board are producers and handlers of avocados. They are 
familiar with the Board'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

[[Page 15059]]

input. The assessment rate can be revised when it is recommended by the 
Committee and approved the USDA.
    Authority to fix the rate of assessment to be paid by each handler 
and to collect such assessment appears in Sec.  915.41 of the order. In 
addition, Sec.  915.45 of the order provides that the Committee, with 
the approval of USDA, may establish or provide for the establishment of 
production research, marketing research, and market development 
projects designed to assist, improve, or promote the marketing, 
distribution, consumption, or efficient production of avocados. The 
expense of such projects is paid from funds collected pursuant to Sec.  
915.41 (Assessments).
    Under the current definition of the order, the Committee must have 
a quorum of eight and at least eight concurring votes to increase 
assessment rates above $0.20 per bushel. The Committee consists of ten 
members, and the quorum requirement for all other voting purposes is 
seven members.
    According to record evidence, the Committee has had difficulties 
meeting the eight-member quorum and consensus requirement specific to 
assessment rate increases above $0.20 per bushel. Witnesses explained 
that recommendations to increase the assessment rate above this level 
typically arise during periods of economic hardship, such as crop loss 
after a hurricane. During the 2004-2005 season, the last time the 
assessment rate was changed to a level above $0.20 per bushel, it took 
three separate meeting attempts to receive the required quorum votes of 
eight. The assessment rate change was needed to increase the reserve 
funds for continued operation of the committee because crop estimates 
were below expectations and reserve funds had become low. As a result, 
the Committee has not been able to be as responsive as it wanted to be 
in obtaining adequate funds to operate the Committee.
    The Committee's proposal to relax voting requirements for increases 
in the assessment rate would facilitate the Committee's ability to be 
responsive. The amendment would require that for any change in the 
assessment rate a quorum of seven Committee members would be required 
and a two-thirds consensus vote of attending members would be needed to 
approve the change.
    According to the record, the original intent regarding voting 
requirements for assessment rates above $0.20 per bushel was to provide 
growers with a voice in significant changes in the assessment rate. 
Historically there has been tension between growers and handlers, so 
the order was written to provide balance between growers and handlers 
when changes in the assessment rate above the specified threshold were 
proposed. According to witnesses there now exists general unity between 
handlers and growers, especially with regard to this specific proposal. 
Handlers and growers agree that especially during times of economic 
hardships it is beneficial to relax the voting requirements to 
facilitate the Committee's ability to be responsive.
    The language for this proposed amendment published in the Notice of 
Hearing only states a \2/3\ majority requirement but did not clarify 
that a quorum was necessary. For this reason, USDA proposes that 
proposed amendatory language for Sec.  915.30, Procedure, be modified 
to clarify that a quorum of seven Committee members is required in 
addition to the two-thirds majority vote to recommend an assessment 
rate change. The modified language would read as follows: ``For any 
recommendation of the Committee for an assessment rate change, a quorum 
of seven Committee members and a two-thirds majority vote of approval 
of those in attendance is required.''
    It is recommended that the order be amended to revise the voting 
requirements to increase the assessment rate above $0.20 per bushel. 
The ability to recommend any rate change with a two-thirds majority 
vote, given that the quorum requirement is met, would allow the 
Committee more flexibility in responding to the needs of the industry. 
Without this authority, the Committee's ability to react and modify the 
assessment rate to cover operational costs would be unnecessarily 
limited.
    For the reasons above, it is recommended that Sec.  915.30 be 
amended. This amendment would remove the current voting requirement for 
rate increases above $0.20 per bushel that stipulates a quorum of eight 
Committee members and eight concurring votes for approval. The new 
voting requirement, modified by USDA as recommended above, would be 
applicable to all assessment rate increases and would provide for a 
quorum of seven Committee members and a two-thirds majority vote of 
those in attendance for approval. There was no opposition testimony on 
this issue.

Material Issue Number 3--Allow for District 1 Nominations To Be 
Conducted by Mail

    Section 915.22, Nomination, should be amended to provide District 1 
with the authority to conduct nominations by mail.
    Under the current nomination rules of the order, growers residing 
in District 1 must vote in person at the designated polling office, 
which is located at the Miami-Dade County Extension office. The 
proposed amendment would allow growers to vote via mail on nominations 
for the Committee. If implemented, this amendment would also remove the 
Committee's financial outlays associated with holding a nomination 
meeting, and would reduce the financial and other burdens currently 
required of growers commuting to vote.
    Witnesses testified that a considerable amount of growers in 
District 1 do not live within an easily commutable radius of the 
nomination meeting location. According to the record, some growers can 
spend hours commuting to the meeting due to both distance and traffic 
congestion. Witnesses stated that time spent commuting often results in 
lost wages because of time spent away from the workplace. Along with 
lost wages, growers are also burdened with the costs of fuel for their 
commute.
    According to witnesses, the burdens of commuting to a nomination 
meeting have led to poor voter turnout. Witnesses stated that during 
the previous District 1 nomination, voter turnout equaled less than 30 
growers, which is fewer than 15% of the total 220 registered growers in 
that district. According to the record, growers in District 1 have 
stated a reluctance to participate because the burdens associated with 
traveling to the meeting are too great.
    A witness also testified that the costs associated with conducting 
a nomination meeting are not justified due to low voter participation. 
The witness stated that both a USDA representative and a Committee 
staff member are required to conduct nomination meetings. Given that 
few growers in District 1 elect to attend the nomination meetings, two 
employee work days are used to accommodate a very low level of grower 
participation.
    Witnesses also stated that growers in District 2 have the authority 
to vote via mail. The benefits of voting by mail in District 1 could be 
obtained without additional costs incurred by the Committee. The cost 
of mailing the ballots within District 1 would be less than the costs 
associated with staffing a voting location.
    Also, continuance referenda, considered by witnesses to be the most 
important vote that growers participate in, are conducted by mail. 
Thus, witnesses stated that the precedence for successful voter 
participation by mail exists under the order and should be extended to 
nomination voting for District 1.

[[Page 15060]]

    Witnesses supported the Committee's recommendation to change the 
date for submitting names of the nominees from February 15 to March 1. 
The extra time is needed to accommodate mail balloting.
    According to the record, the benefits of allowing District 1 vote 
by mail include: increased voter grower participation in the District 1 
Committee nominations, reduced costs on growers' time and money, and 
reduced costs associated with conducting a nomination meeting. Allowing 
District 1 to vote by mail would increase grower participation in the 
voting process without incurring additional expenses.
    For the reasons above, it is recommended that Sec.  915.22 be 
amended to provide the Committee with the authority to conduct 
nominations by mail in District 1. There was no opposition testimony on 
this issue.

Material Issue Number 4--Authority To Accept Voluntary Contributions

    A new Sec.  915.43, Contribution, should be added to provide the 
Committee with the authority to accept voluntary contributions. Such 
contributions should be free from any encumbrances by the donor so that 
the Committee would retain complete control of their use.
    Under the current order, the Committee does not have the authority 
to accept voluntary contributions. All marketing order activities are 
funded through handler assessments. Adding Sec.  915.43 to the order 
would provide the Committee with the authority to accept voluntary 
contributions. According to the record, voluntary contributions could 
help the Committee meet its administrative responsibilities under the 
order during times of economic hardships and may also provide 
additional funds for Committee research and development activities.
    Witnesses testified that the authority to accept voluntary 
contributions would be beneficial, especially during times of 
emergency, and that such monies could potentially assist in averting 
the need to increase handler assessments during those times. According 
to witnesses, if contributions are available, then the Committee should 
have the authority to accept them.
    Voluntary contributions could also assist the Committee in 
addressing complex crop growth and development issues facing the 
avocado industry. Witnesses stated that voluntary contributions could 
fund research on disease and pest issues that threaten the industry 
which, due to a lack of adequate funds, the Committee has not been able 
to address. The proposal to add authority to the order to use voluntary 
contributions for production research, marketing research and 
development activities was discussed and supported by witnesses at the 
hearing. For this reason, and based on supporting evidence found in the 
record of hearing, USDA recommends a conforming change to Sec.  915.45, 
Production research, marketing research and development, of the order. 
This section should be modified to allow for such activities to be to 
be paid for by either assessment funds (provided for under Sec.  
915.41, Assessments) or any receipts received as contributions 
(proposed under the new Sec.  915.43, Contributions). This proposed 
conforming change has been included in the regulatory text of this 
recommended decision.
    It is recommended that the order be amended to add the authority 
for the Committee to accept voluntary contributions. Currently the 
Committee does not have the authority under the order to accept 
voluntary contributions from any source. Providing the Committee with 
the authority to accept voluntary contributions could help the 
Committee meet its administrative responsibilities under the order. 
Also, voluntary contributions could be used to conduct research. For 
the reasons above, it is recommended that Sec.  915.43 be added to 
provide the authority for the Committee to accept voluntary 
contributions. Based on the record, USDA is also recommending a 
conforming change to Sec.  915.45, Production research, marketing 
research and development, so that voluntary contributions, in addition 
to assessments, may be used for activities provided for under this 
provision. There was no opposition testimony on this issue.

Small Business Consideration

    Pursuant to the requirements set forth in the Regulatory 
Flexibility Act (RFA), 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 so that small businesses will not be 
unduly or disproportionately burdened. Marketing orders and amendments 
thereto are unique in that they are normally brought about through 
group action of essentially small entities for their own benefit.
    Small agricultural producers 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, which 
include handlers regulated under the order, are defined as those with 
annual receipts of less than $6,500,000.
    Interested persons were invited to present evidence at the hearing 
on the probable regulatory and informational impact of the proposed 
amendments to the order on small business. The record evidence is that 
while minimal costs may occur upon implementation of some of the 
proposed amendments, those costs would be outweighed by the benefits 
expected to accrue to the Florida fresh market avocado industry.

Avocado Industry Background and Overview

    There are approximately 300 producers of avocados in the production 
area and approximately 35 handlers subject to regulation under the 
order.
    According to the National Agricultural Statistics Service (NASS) 
and Committee data, the average price for Florida avocados during the 
2005-06 season was around $46.75 per 55-pound bushel container, and 
total shipments were near 470,000 55-pound bushel equivalent. Using the 
average price and shipment information provided by the Committee, the 
majority of avocado handlers could be considered small businesses under 
the SBA definition. In addition, based on avocado production, grower 
prices, and the total number of Florida avocado growers, the average 
annual grower revenue is less than $750,000. Thus, the majority of 
Florida avocado producers may also be classified as small entities.
    The NASS reported that in 2005, total Florida avocado bearing acres 
were 5,300 and the average yield per acre was 2.26 tons. The total 
Florida production reported in 2005 was 12,000 tons, with growers 
receiving an average (farm gate) price of $940/ton. The estimated total 
value of 2005 Florida avocado production was $11.28 million.
    Over the past 30 years the U.S. avocado industry has seen many 
changes. According to NASS, the total U.S. production acres for 
avocados have decreased by 13 percent, from 78,000 acres in 1982 to 
67,600 acres in 2005. Prices have trended upward from 1959 to 2005, 
although there has been significant variability in prices from year to 
year. The average grower price for the U.S. in 1959 was $109 per ton 
and in 2005 the average grower price was $1,280 per ton. The total 
value of U.S. avocado production has increased dramatically since 1959, 
reaching a peak of $394 million in 2003. The per capital consumption of 
fresh avocados has risen significantly since 1970. Between 1970

[[Page 15061]]

and 2004, per capital consumption increased almost five-fold to 2.9 
pounds per person in 2004. According to the record, the availability of 
imported avocados, in addition to domestically produced avocados, 
resulting in year-round availability could be contributing to this 
increase.
    Comparatively, Florida's avocado industry has seen similar trends. 
According to NASS, the production acreage has decreased by 53 percent 
over the last three decades. According to record evidence, the rapid 
decrease in Florida production acreage compared to that of U.S. acreage 
can be directly associated with crop damage resulting from hurricanes. 
Florida's production trended upward to 34,700 tons in the early 1980's 
and has shown great variability since. Production in 2005 was at a 10 
year low of 12,000 tons. After Hurricane Andrew, which affected the 
value of production in 1992 and 1993, the value of Florida's production 
has ranged from a high of $17.2 million in 2003 to a low of $11.3 
million in 2005.

Proposal 1, Adding the Authority To Borrow Funds

    The proposal described in Material Issue No. 1 would amend Sec.  
915.41, Assessments, to add authority for the Committee to borrow 
funds. If implemented, the authority to borrow funds would be limited 
to use by the Committee to meet its administrative responsibilities 
under the order during times of economic hardship.
    Witnesses supported this proposal by stating that the authority to 
borrow funds would provide the Committee with an alternative revenue 
source besides assessments. The industry has experienced multiple years 
of economic hardship resulting in decreased production levels. Lower 
production levels reduce the amount of assessments collected from the 
handlers, which has resulted in depleting the Committee's monetary 
reserve over past years.
    According to the record, any interest incurred by the Committee on 
the borrowed funds would be offset by the benefit of keeping the 
Committee operating. Thus, no significant impact on small business 
entities is anticipated.

Proposal 2, Revising the Voting Requirements for Committee 
Recommendations To Increase the Assessment Rate

    The proposal described in Material Issue No. 2 would amend Sec.  
915.30, Procedure, to revise the current voting requirements for 
Committee recommendations to increase the assessment rate above $0.20 
per bushel from eight concurring votes to a two-thirds majority vote of 
those Committee members in attendance. If implemented, this proposed 
amendment would allow the Committee to be more flexible in dealing with 
inflation and economic hardships that impact the Committee's monetary 
reserves.
    Witnesses supported this proposal by stating that the current 
voting requirements have resulted in delaying the Committee's ability 
to quickly respond to needs for an increase in assessments. According 
to the record, during the 2004-2005 season, the last time the 
assessment rate was changed, it took three separate meeting attempts to 
receive the required quorum votes of eight. The assessment rate change 
was needed to increase the reserve funds for continued operation of the 
Committee because crop estimates were below expectations and reserve 
funds were low.
    Relaxing the voting requirements would reduce the probability that 
multiple meetings would need to be held before quorum was met, as well 
as increase the Committee's ability to effectively respond to budget 
needs. Therefore the costs of revising the voting requirements should 
be out weighed by the benefits.

Proposal 3, Allowing for District 1 Nominations To Be Conducted by Mail

    The proposal described in Material Issue No. 3 would amend Sec.  
915.22, Nomination, to provide the Committee with the authority to 
conduct nominations for District 1 by mail.
    Under the current nomination rules, growers living in District 1 
must vote in person at the designated polling office, which is located 
at the Miami-Dade County Extension office. The proposed amendment would 
allow growers to vote via mail on nominations for the Committee. If 
implemented, this amendment would reduce financial outlays associated 
with maintaining a physical voting location, and would reduce the 
financial and physical burdens currently required of growers commuting 
to vote.
    The impact for providing the Committee with the authority to 
conduct nominations by mail for District 1 would result with increased 
mailing costs. Any increased mailing cost would be less than or equal 
to current staffing costs. Witnesses testified that the benefits of 
increased grower participation and reduced transportation costs for 
growers would offset any possible costs associated with this proposal.

Proposal 4, Adding Authority To Accept Voluntary Contributions

    The proposal described in Material Issue No. 4 would add a new 
Sec.  915.43, Contributions, and would allow the Committee to accept 
voluntary contributions. Contributions would be free from any 
encumbrances by the donor and, according to the record, the 
contributions could be used to cover operational costs during times of 
economic hardships or fund research. According to the hearing record, 
the Committee would retain oversight over such contributions.
    Witnesses supported this proposal by stating that it would provide 
the Committee and the industry with an additional source of revenue to 
cover operational costs or to fund research. It is not expected that 
this proposal would result in any additional costs to growers or 
handlers.

Paperwork Reduction Act

    In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 
Chapter 35), this notice announces that AMS is seeking approval from 
OMB for a new information collection request for Avocados Grown in 
South Florida, Marketing Order No. 915, under OMB No. 0581-New. Upon 
OMB approval, the additional burden will be merged into the information 
collection currently approved under OMB No. 0581-0189, ``Generic OMB 
Fruit Crops.''
    Title: Avocados Grown in South Florida, Marketing Order No. 915.
    OMB No.: 0581-NEW.
    Expiration Date of Approval: Three years from OMB date of approval.
    Type of Request: New collection.
    Abstract: The information collection requirement in this request is 
essential to provide growers and handlers with ballots so that 
nominations for the Committee can be conducted by mail.
    This information collected is used only by authorized 
representatives of USDA, including AMS, Fruit and Vegetable Programs 
regional and headquarters' staff, and authorized employees and agents 
of the Committee. Authorized Committee employees, agents, and the 
industry are the primary users of the information and AMS is the 
secondary user.

Grower Ballot To Nominate Members and Alternate Members for District 1 
or District 2

    Avocado growers would use this ballot to nominate members and 
alternative members, either for District 1 or District 2 (whichever is 
applicable), to serve on the Committee. The ballot would be used when 
voting by mail.

[[Page 15062]]

    Estimate of Burden: Public reporting burden for this collection of 
information is estimated to average 0.083 hour per response.
    Respondents: Avocado growers.
    Estimated Number of Respondents: 352.
    Estimated Number of Responses per Respondent: 1.
    Estimated Total Annual Burden on Respondents: 29 hours.

Handler Ballot To Nominate Members and Alternate Members for District 1 
or District 2

    Avocado handlers would use this ballot to nominate members and 
alternate members for either District 1 or District 2 (whichever is 
applicable), to serve on the Committee. This ballot would be used when 
voting by mail.
    Estimate of Burden: Public reporting burden for this collection of 
information is estimated to average 0.083 hour per response.
    Respondents: Avocado handlers.
    Estimated Number of Respondents: 32.
    Estimated Number of Responses per Respondent: 1.
    Estimated Total Annual Burden on Respondents: 3 hours.
    The Committee recommended amending the nomination process to allow 
for District 1 nominations to be conducted by mail.
    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 
date were widely publicized throughout the Florida avocado industry, 
and all interested persons were invited to attend the meetings, 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. 
Finally, interested persons are invited to submit information on the 
regulatory and informational impacts of this action on small 
businesses.
    The 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.

Civil Justice Reform

    The amendments to Marketing Order 915 proposed herein have been 
reviewed under Executive Order 12988, Civil Justice Reform. They are 
not intended to have retroactive effect. If adopted, the proposed 
amendments would 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 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 no later than 20 days after the date of the 
entry of the ruling.

Rulings on Briefs of Interested Persons

    Briefs, proposed findings and conclusions, and the evidence in the 
record were considered in making the findings and conclusions set forth 
in this recommended decision. To the extent that the suggested findings 
and conclusions filed by interested persons are inconsistent with the 
findings and conclusions of this recommended decision, the requests to 
make such findings or to reach such conclusions are denied.

General Findings

    The findings hereinafter set forth are supplementary to the 
findings and determinations which were previously made in connection 
with the issuance of the marketing agreement and order; and all said 
previous findings and determinations are hereby ratified and affirmed, 
except insofar as such findings and determinations may be in conflict 
with the findings and determinations set forth herein:
    (1) The marketing agreement and order, as amended, and as hereby 
proposed to be further amended, and all of the terms and conditions 
thereof, would tend to effectuate the declared policy of the Act;
    (2) The marketing agreement and order, as amended, and as hereby 
proposed to be further amended, regulate the handling of avocados grown 
in the production area in the same manner as, and are applicable only 
to, persons in the respective classes of commercial and industrial 
activity specified in the marketing agreement and order upon which a 
hearing has been held;
    (3) The marketing agreement and order, as amended, and as hereby 
proposed to be further amended, are limited to their 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 subdivisions of the production area would 
not effectively carry out the declared policy of the Act;
    (4) The marketing agreement and order, as amended, and as hereby 
proposed to be further amended, prescribe, 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 avocados grown in the production area; and
    (5) All handling of avocados grown in the production area as 
defined in the marketing agreement and order, is in the current of 
interstate or foreign commerce or directly burdens, obstructs, or 
affects such commerce.
    A 30-day comment period is provided to allow interested persons to 
respond to this proposal. Thirty days is deemed appropriate so that the 
proposed amendments may be implemented as close to the beginning of the 
coming crop year as possible. The next crop year begins April 1. All 
written exceptions timely received will be considered and a grower 
referendum will be conducted before these proposals are implemented.

List of Subjects in 7 CFR Part 915

    Avocados, Marketing agreements, Reporting and recordkeeping 
requirements.

    For the reasons set forth in the preamble the Agricultural 
Marketing Service proposes to amend title 7 part 915 of the Code of 
Federal Regulations as follows:

PART 915--AVOCADOS GROWN IN SOUTH FLORIDA

    1. The authority citation for 7 CFR part 915 continues to read as 
follows:

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

    2. In Sec.  915.11, paragraphs (a) and (b) are revised to read as 
follows:

[[Page 15063]]

Sec.  915.11  District.

    (a) District 1 shall include Miami-Dade County.
    (b) District 2 shall include all of the production area except 
Miami-Dade County.
    3. In Sec.  915.22, paragraph (b)(1) is revised to read as follows:


Sec.  915.22  Nomination.

    (a) * * *
    (b) Successor members. (1) The Committee shall hold or cause to be 
held a meeting or meetings of growers and handlers in each district to 
designate nominees for successor members and alternate members of the 
Committee; or the Committee may conduct nominations in Districts 1 and 
2 by mail in a manner recommended by the Committee and approved by the 
Secretary. Such nominations shall be submitted to the Secretary by the 
Committee not later than March 1 of each year. The Committee shall 
prescribe procedural rules, not inconsistent with the provisions of 
this section, for the conduct of nomination.
* * * * *
    4. In Sec.  915.30, paragraph (c) is revised to read as follows:


Sec.  915.30  Procedure.

    (a) * * *
    (b) * * *
    (c) For any recommendation of the Committee for an assessment rate 
change, a quorum of seven Committee members and a two-thirds majority 
vote of approval of those in attendance is required.
    5. In Sec.  915.41, paragraph (b) is revised to read as follows:


Sec.  915.41  Assessments.

    (a) * * *
    (b) The Secretary shall fix the rate of assessment per 55-pounds of 
fruit or equivalent in any container or in bulk, to be paid by each 
such handler. At any time during or after a fiscal year, the Secretary 
may increase the rate of assessment, in order to secure sufficient 
funds to cover any later finding by the Secretary relative to the 
expense which may be incurred. Such increase shall be applied to all 
fruit handled during the applicable fiscal year. In order to provide 
funds for the administration of the provisions of this part, the 
Committee may accept the payment of assessments in advance, or borrow 
money on an emergency short-term basis. The authority of the Committee 
to borrow money is subject to approval of the Secretary and may be used 
only to meet financial obligations as the obligations occur or to allow 
the Committee to adjust its reserve funds to meet such obligations.
    6. Add a new Sec.  915.43 to read as follows:


Sec.  915.43  Contributions.

    The Committee may accept voluntary contributions. Such 
contributions shall be free from any encumbrances by the donor and the 
Committee shall retain complete control of their use.
    7. Revise Sec.  915.45 to read as follows:


Sec.  915.45  Production research, marketing research and development.

    The committee may, with the approval of the Secretary, establish or 
provide for the establishment of production research, marketing 
research and development projects designed to assist, improve or 
promote the marketing, distribution, and consumption or efficient 
production of avocados. Such products may provide for any form of 
marketing promotion, including paid advertising. The expenses of such 
projects shall be paid from funds collected pursuant to the applicable 
provisions of Sec.  915.41, or from such other funds as approved by the 
USDA.

    Dated: March 23, 2007.
Lloyd C. Day,
Administrator, Agricultural Marketing Service.
[FR Doc. E7-5792 Filed 3-29-07; 8:45 am]
BILLING CODE 3410-02-P