[Federal Register Volume 73, Number 41 (Friday, February 29, 2008)]
[Rules and Regulations]
[Pages 10976-10978]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-3801]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 966

[Docket No. AMS-FV-07-0014; FV07-966-2 FIR]


Tomatoes Grown in Florida; Decreased Assessment Rate

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

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SUMMARY: The Department of Agriculture (USDA) is adopting, as a final 
rule, without change, an interim final rule which decreased the 
assessment rate established for the Florida Tomato Committee 
(Committee) for the 2007-08 and subsequent fiscal periods from $0.035 
to $0.0325 per 25-pound carton of tomatoes handled. The Committee 
locally administers the marketing order which regulates the handling of 
tomatoes grown in Florida. Assessments upon tomato handlers are used by 
the Committee to fund reasonable and necessary expenses of the program. 
The fiscal period begins August 1 and ends July 31. The assessment rate 
will remain in effect indefinitely unless modified, suspended, or 
terminated.

DATES: Effective Date: March 31,2008.

FOR FURTHER INFORMATION CONTACT: William G. Pimental, Marketing 
Specialist or Christian D. Nissen, Regional Manager, Southeast 
Marketing Field Office, Marketing Order Administration Branch, Fruit 
and Vegetable Programs, AMS, USDA; Telephone: (863) 324-3375, Fax: 
(863) 325-8793, 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 rule is issued under Marketing 
Agreement No. 125 and Order No. 966, both as amended (7 CFR part 966), 
regulating the handling of tomatoes grown in Florida, 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.''
    USDA is issuing this rule in conformance with Executive Order 
12866.
    This rule has been reviewed under Executive Order 12988, Civil 
Justice Reform. Under the marketing order now in effect, Florida tomato 
handlers are subject to assessments. Funds to administer the order are 
derived from such assessments. It is intended that the assessment rate 
as issued herein will be applicable to all assessable tomatoes 
beginning August 1, 2007, and continue until amended, suspended, or 
terminated. This rule will not preempt any State or local laws, 
regulations, or policies, unless they present an irreconcilable 
conflict with this rule.
    The Act provides that administrative proceedings must be exhausted 
before parties may file suit in court. Under section 608c(15)(A) of the 
Act, any handler subject to an order may file with USDA a petition 
stating that the order, any provision of the order, or any obligation 
imposed in connection with the order is not in accordance with law and 
request a modification of the order or to be exempted therefrom. 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.

[[Page 10977]]

    This rule continues in effect the action that decreased the 
assessment rate established for the Committee for the 2007-08 and 
subsequent fiscal periods from $0.035 per 25-pound carton to $0.0325 
per 25-pound carton of tomatoes.
    The Florida tomato marketing order provides authority for the 
Committee, with the approval of USDA, to formulate an annual budget of 
expenses and collect assessments from handlers to administer the 
program. The members of the Committee are producers of Florida 
tomatoes. They are familiar with the Committee's needs and with the 
costs for goods and services in their local area and are thus in a 
position to formulate an appropriate budget and assessment rate. The 
assessment rate is formulated and discussed in a public meeting. Thus, 
all directly affected persons have an opportunity to participate and 
provide input.
    For the 2006-07 and subsequent fiscal periods, the Committee 
recommended, and USDA approved, an assessment rate that would continue 
in effect from fiscal period to fiscal period unless modified, 
suspended, or terminated by USDA upon recommendation and information 
submitted by the Committee or other information available to USDA.
    The Committee met on August 23, 2007, and unanimously recommended 
2007-08 expenditures of $2,101,000.00 and an assessment rate of $0.0325 
per 25-pound carton of tomatoes. In comparison, last year's budgeted 
expenditures were $2,193,700. The assessment rate of $0.0325 is $0.0025 
lower than the rate previously in effect. Last season the industry 
shipped 2.6 million 25-pound cartons more than the Committee had 
anticipated, providing greater revenues than expected from assessments. 
The Committee's 2006-07 expenses were $200,000 less than budgeted, and 
they utilized less from reserves than anticipated. The Committee also 
recommended a reduced budget for 2007-08. Therefore, the Committee 
voted to recommend a reduced assessment rate.
    The major expenditures recommended by the Committee for the 2007-08 
year include $900,000 for education and promotion, $467,000 for 
salaries, $320,000 for research, and $71,000 for employee retirement. 
Budgeted expenses for these items in 2006-07 were $1,000,000, $445,900, 
$320,000, and $67,000, respectively.
    The assessment rate recommended by the Committee was derived by 
dividing anticipated expenses, less carry-in and reserve revenues 
totaling $476,000, by expected shipments of Florida tomatoes. Tomato 
shipments for the year are estimated at 50 million 25-pound cartons, 
which should provide $1,625,000 in assessment income. Income derived 
from handler assessments, along with interest income and funds from the 
Committee's authorized reserve will be adequate to cover budgeted 
expenses. Funds in the reserve (currently approximately $780,000) will 
be kept within the maximum permitted by Sec.  966.44 of the order, 
which states that excess funds cannot exceed one fiscal period's 
expenses.
    The assessment rate will continue in effect indefinitely unless 
modified, suspended, or terminated by USDA upon recommendation and 
information submitted by the Committee or other available information.
    Although this assessment rate is effective for an indefinite 
period, the Committee will continue to meet prior to or during each 
fiscal period to recommend a budget of expenses and consider 
recommendations for modification of the assessment rate. The dates and 
times of Committee meetings are available from the Committee or USDA. 
Committee meetings are open to the public and interested persons may 
express their views at these meetings. USDA will evaluate Committee 
recommendations and other available information to determine whether 
modification of the assessment rate is needed. Further rulemaking will 
be undertaken as necessary. The Committee's 2007-08 budget and those 
for subsequent fiscal periods will be reviewed and, as appropriate, 
approved by USDA.

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 small businesses will 
not be unduly or disproportionately burdened. Marketing orders issued 
pursuant to the Act, and the rules issued thereunder, are unique in 
that they are brought about through group action of essentially small 
entities acting on their own behalf.
    There are approximately 100 producers of tomatoes in the production 
area and approximately 70 handlers subject to regulation under the 
marketing order. Small agricultural producers are defined by the Small 
Business Administration (13 CFR 121.201) as those having annual 
receipts less than $750,000, and small agricultural service firms are 
defined as those whose annual receipts are less than $6,500,000.
    Based on industry and Committee data, the average annual price for 
fresh Florida tomatoes during the 2006-07 season was approximately 
$7.69 per 25-pound container, and total fresh shipments for the 2006-07 
season were 52,505,687 25-pound cartons of tomatoes. Committee data 
indicates that approximately 25 percent of the handlers handle 94 
percent of the total volume shipped outside the regulated area. Based 
on the average price, about 75 percent of handlers could be considered 
small businesses under SBA's definition. In addition, based on 
production data, grower prices as reported by the National Agricultural 
Statistics Service, and the total number of Florida tomato growers, the 
average annual grower revenue is below $750,000. Thus, the majority of 
handlers and producers of Florida tomatoes may be classified as small 
entities.
    This rule continues in effect the action that decreased the 
assessment rate established for the Committee and collected from 
handlers for the 2007-08 and subsequent fiscal periods from $0.035 to 
$0.0325 per 25-pound carton of tomatoes. The Committee unanimously 
recommended 2007-08 expenditures of $2,101,000 and an assessment rate 
of $0.0325 per 25-pound carton. The assessment rate of $0.0325 is 
$0.0025 lower than the 2006-07 rate. The quantity of assessable 
tomatoes for the 2007-08 season is estimated at 50 million 25-pound 
cartons. Thus, the $0.0325 rate should provide $1,625,000 in assessment 
income. Income derived from handler assessments, along with interest 
income and funds from the Committee's authorized reserve will be 
adequate to cover budgeted expenses.
    The major expenditures recommended by the Committee for the 2007-08 
year include $900,000 for education and promotion, $467,000 for 
salaries, $320,000 for research, and $71,000 for employee retirement. 
Budgeted expenses for these items in 2006-07 were $1,000,000, $445,900, 
$320,000, and $67,000, respectively.
    Last season the industry shipped 2.6 million 25-pound cartons more 
than the Committee had anticipated, providing greater revenues than 
expected from assessments. The Committee's 2006-07 expenses were 
$200,000 less than budgeted, and they utilized less from reserves than 
anticipated. The Committee also recommended a reduced budget for 2007-
08. Therefore,

[[Page 10978]]

the Committee voted to recommend a reduced assessment rate.
    The Committee reviewed and unanimously recommended 2007-08 
expenditures of $2,101,000, which included a decrease in the education 
and promotion budget. Prior to arriving at this budget, the Committee 
considered information from various sources, such as the Committee's 
Executive Subcommittee, Finance Subcommittee, Research Subcommittee, 
and Education and Promotion Subcommittee. Alternative expenditure 
levels were discussed by these groups, based upon the relative value of 
various research projects to the tomato industry. The assessment rate 
of $0.0325 per 25-pound carton of assessable tomatoes was then 
determined by dividing the total recommended budget, less carry-in and 
reserve revenues totaling $476,000, by the quantity of tomatoes, 
estimated at 50 million 25-pound cartons for the 2007-08 fiscal period.
    A review of historical information and preliminary information 
pertaining to the upcoming 2007-08 fiscal period indicates that the 
grower price for the 2007-08 season could range between $3.89 and 
$16.05 per 25-pound carton of tomatoes. Therefore, the estimated 
assessment revenue for the 2007-08 fiscal period as a percentage of 
total grower revenue could range between 0.2 and 0.8 percent.
    This action continues in effect the action that decreased the 
assessment obligation imposed on handlers. Assessments are applied 
uniformly on all handlers, and some of the costs may be passed on to 
producers. However, decreasing the assessment rate reduces the burden 
on handlers, and may reduce the burden on producers. In addition, the 
Committee's meeting was widely publicized throughout the Florida tomato 
industry and all interested persons were invited to attend the meeting 
and participate in Committee deliberations on all issues. Like all 
Committee meetings, the August 23, 2007, meeting was a public meeting 
and all entities, both large and small, were able to express views on 
this issue.
    This action imposes no additional reporting or recordkeeping 
requirements on either small or large Florida tomato handlers. As with 
all Federal marketing order programs, reports and forms are 
periodically reviewed to reduce information requirements and 
duplication by industry and public sector agencies. In addition, as 
noted in the initial regulatory flexibility analysis, USDA has not 
identified any relevant Federal rules that duplicate, overlap, or 
conflict with this 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.
    An interim final rule concerning this action was published in the 
Federal Register on November 15, 2007 (72 FR 64123). Copies of that 
rule were also mailed or sent via facsimile to all Florida tomato 
handlers. Finally, the interim final rule was made available through 
the Internet by USDA and the Office of the Federal Register. A 60-day 
comment period was provided for interested persons to respond to the 
interim final rule. The comment period ended January 14, 2008, and no 
comments were received.
    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 material presented, including 
the information and recommendation submitted by the Committee and other 
available information, it is hereby found that this rule, as 
hereinafter set forth, will tend to effectuate the declared policy of 
the Act.

List of Subjects in 7 CFR Part 966

    Marketing agreements, Reporting and recordkeeping requirements, 
Tomatoes.

PART 966--TOMATOES GROWN IN FLORIDA

0
Accordingly, the interim final rule amending 7 CFR part 966 which was 
published at 72 FR 64123 on November 15, 2007, is adopted as a final 
rule without change.

    Dated: February 25, 2008.
Lloyd C. Day,
Administrator, Agricultural Marketing Service.
 [FR Doc. E8-3801 Filed 2-28-08; 8:45 am]
BILLING CODE 3410-02-P