[Federal Register Volume 72, Number 134 (Friday, July 13, 2007)]
[Rules and Regulations]
[Pages 38465-38467]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E7-13580]


-----------------------------------------------------------------------

DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 928

Docket No. AMS-FV-07-0024; FV02-928-3 FR]


Papayas Grown in Hawaii; Termination of Marketing Order 928 and 
Implementing Rules and Regulations

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule, termination order.

-----------------------------------------------------------------------

SUMMARY: This final rule terminates the Federal marketing order (order) 
for papayas grown in Hawaii, and the rules and regulations established 
under the order. The Department of Agriculture (USDA) previously 
determined the order should be terminated due to the results of a 
referendum in which growers indicated a lack of support for the 
continuation of the order. However, USDA postponed the termination 
until licensing agreements regarding development and use of transgenic 
papaya varieties could be resolved. Sufficient time has elapsed for the 
industry to resolve any outstanding licensing issues. Therefore, USDA 
is proceeding with the termination of the order.

DATES: Effective Date: July 16, 2007.

FOR FURTHER INFORMATION CONTACT: Marc McFetridge, Marketing Specialist, 
Marketing Order Administration Branch, Fruit and Vegetable Programs, 
AMS, USDA, 1400 Independence Ave., SW., Stop 0237, Washington, DC 
20250-0237; telephone (202) 720-1509, Fax (202) 720-8938; 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 action is being taken pursuant to Sec.  
608c(16)(A) of the Agricultural Marketing Agreement Act of 1937, as 
amended (7 U.S.C. 601-674), hereinafter referred to as the ``Act,'' and 
Sec.  928.64 of the order.
    USDA is issuing this rule in conformance with Executive Order 
12866.
    This final rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. This rule is not intended to have retroactive 
effect. 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. 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 terminates the marketing order for papayas grown in 
Hawaii and the rules and regulations issued thereunder. The order 
provides the authority to regulate the handling of papayas grown in 
Hawaii and was administered locally by the Papaya Administrative 
Committee (PAC).
    The order has been in effect since 1971. The order authorizes the 
establishment of grade, size, quality, pack, and container 
requirements. The order also authorizes production and marketing 
research, market development, and paid advertising for Hawaii papayas. 
The program was funded by assessments imposed on papaya handlers.
    Section 928.64(e) of the order specifies that continuance referenda 
must be conducted among papaya producers every sixth year before 
October 1. In accordance with this section, USDA conducted a referendum 
among papaya growers during the

[[Page 38466]]

period from May 6 to May 31, 2002, to determine if they favored 
continuation of their program. The referendum order provided that USDA 
would consider terminating the provisions of the order if less than 
two-thirds of the number of growers voting and growers of less than 
two-thirds of the papaya volume represented in the referendum favored 
continuance.
    Ballots were mailed to 462 known papaya growers in Hawaii. By the 
close of the voting period, 55 valid votes had been cast. The results 
show that 49 percent of the growers voting, who produced 21 percent of 
the volume represented in the referendum, favored continuation of the 
program. The order failed to pass both criteria for continuance, 
demonstrating a lack of producer support needed to carry out the 
objectives of the Act. Thus, USDA determined that the order should be 
terminated.
    However, the papaya industry requested that USDA postpone the 
termination of the order until licensing issues concerning development 
and use of transgenic papaya varieties were resolved. It was important 
for the industry to continue to commercially grow and sell the 
transgenic papayas. The PAC was authorized to use the patented papayas 
varieties and wished to transfer this authority to another entity 
before dissolution of the PAC with the termination of the order. USDA 
agreed to postpone the termination allowing the PAC to remain in 
existence while the issues were resolved.
    USDA has been in contact with the papaya industry periodically to 
monitor the papaya industry's progress in resolving the licensing 
issues. According to the president of the HPIA, the agreements were 
expected to be finalized within a few months. Sufficient time has 
elapsed for the industry to resolve any outstanding licensing issues. 
Therefore, USDA is proceeding with the termination of the order.
    Pursuant to section 608c(16)(A) of the Act and Sec.  928.64 of the 
order, it has been previously found that the order provisions should be 
terminated. Section 608c(16)(A) of the Act requires USDA to notify 
Congress at least 60 days before terminating a Federal marketing order 
program. Congress was so notified on July 12, 2002.
    Effective August 1, 2002 (67 FR 50581), the reporting and 
assessment requirements specified in Sec. Sec.  928.160 and 928.226, 
respectively, were suspended. This termination order removes these 
provisions and other rules and regulations established under the order.
    Pursuant to Sec.  928.65 of the order, the members of the Papaya 
Administrative Committee shall serve as trustees to conclude and 
liquidate the affairs of the committee.

Final Regulatory Flexibility Analysis

    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA), the Agricultural Marketing Service (AMS) has considered the 
economic impact of this action on small entities. Accordingly, AMS has 
prepared this final regulatory flexibility analysis.
    The purpose of the RFA is to fit regulatory actions to the scale of 
business subject to such actions in order that those 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.
    In 2005 there were 205 producers of papayas in the production area 
and approximately 60 handlers. Small agricultural producers are defined 
as those having annual receipts of less than $750,000, and small 
agricultural service firms, which include handlers, are defined by the 
Small Business Administration (13 CFR 121.201) as those having annual 
receipts of less than $6,500,000.
    Based on a reported average Philadelphia wholesale terminal market 
price in 2006 for fresh papayas of $0.53 per pound, a handler would 
have to ship in excess of 12 million pounds to have annual receipts of 
$6.5 million in 2006. Based on a reported average grower price in 2006 
of $0.391 per pound, and average annual industry shipments of 
approximately 28.7 million pounds in 2006, annual total grower revenues 
would be $11.2 million. Average annual grower revenue would, therefore, 
be $54,740 in 2006. Thus, the majority of handlers and producers of 
papayas may be classified as small entities, excluding receipts from 
other sources.
    This final rule terminates the Hawaii papaya marketing order and 
the rules and regulations established under the order. The order is 
being terminated because in a referendum held in 2002, papaya producers 
failed to support continuation of the program. The papaya industry 
requested postponing the termination of the order until licensing 
issues were resolved regarding development and use of transgenic papaya 
varieties. Sufficient time has elapsed for the industry to resolve any 
outstanding licensing issues. Therefore USDA is proceeding with the 
termination of the order.
    This action eliminates program requirements that were imposed on 
papaya handlers through July 31, 2002. Until that time, handlers were 
required to pay an assessment rate of $0.008 per pound handled. 
Additionally, handlers were required to file monthly reports with the 
committee.
    In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 
Chapter 35), the information collection requirements being terminated 
by this rule were previously approved by the Office of Management and 
Budget (OMB) under OMB No. 0581-0102, Papayas Grown in Hawaii. This 
information collection was terminated by OMB on August 19, 2002.
    USDA has not identified any relevant Federal rules that duplicate, 
overlap or conflict with this final rule.
    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.
    After consideration of all relevant matter presented, including the 
results of a producer referendum held in 2002, it is hereby found that 
the papaya marketing order and the rules and regulations in effect 
under the order do not tend to effectuate the declared policy of the 
Act and, therefore, are terminated.
    It is further found that it is impracticable, unnecessary, and 
contrary to the public interest to give preliminary notice and that 
good cause exists for not postponing the effective date of this rule 
until 30 days after publication in the Federal Register (5 U.S.C. 553) 
because: (1) This action relieves restrictions on handlers by 
terminating the requirements of the papaya marketing order; (2) 
regulations under the order have been suspended for the past five crop 
years; and (3) no useful purpose would be served by delaying the 
effective date.

List of Subjects in 7 CFR Part 928

    Marketing agreements, Papayas, Reporting and recordkeeping 
requirements.

PART 928--[REMOVED]

0
For the reasons set forth in the preamble, and under authority of 7 
U.S.C. 601-674, 7 CFR part 928 is removed.


[[Page 38467]]


    Dated: July 9, 2007.
Lloyd C. Day,
Administrator, Agricultural Marketing Service.
[FR Doc. E7-13580 Filed 7-12-07; 8:45 am]
BILLING CODE 3410-02-P