[Federal Register Volume 73, Number 241 (Monday, December 15, 2008)]
[Rules and Regulations]
[Pages 75931-75934]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-29597]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 987

[Docket No. AMS-FV-08-0056; FV08-987-1 FIR]


Domestic Dates Produced or Packed in Riverside County, CA; 
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

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final rule, without change, an interim final rule which decreased the 
assessment rate established for the California Date Administrative 
Committee (Committee) for the 2008-09 and subsequent crop years from 
$0.75 to $0.60 per hundredweight of dates handled. The Committee 
locally administers the marketing order which regulates the handling of 
dates grown or packed in Riverside County, California. Assessments upon 
date handlers are used by the Committee to fund reasonable and 
necessary expenses of the program. The crop year began October 1 and 
ends September 30. The assessment rate will remain in effect 
indefinitely unless modified, suspended, or terminated.

DATES: Effective Date: January 14, 2009.

FOR FURTHER INFORMATION CONTACT: Terry Vawter, Senior Marketing 
Specialist, or Kurt J. Kimmel, Regional Manager, California Marketing 
Field Office, Marketing Order Administration Branch, Fruit and 
Vegetable Programs, AMS, USDA; Telephone: (559) 487-5901, Fax: (559) 
487-5906, 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 Order 
No. 987, as amended (7 CFR part 987), regulating the handling of dates 
grown or packed in Riverside County, California, 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, California 
date 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 dates 
beginning October 1, 2008, 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. Such 
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 continues in effect the action that decreased the 
assessment rate established for the Committee for the 2008-09 and 
subsequent crop years from $0.75 per to $0.60 per hundredweight of 
dates.
    The California date 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 and handlers of 
California dates. 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 2007-08 and subsequent crop years, the Committee 
recommended, and USDA approved, an assessment rate that would continue 
in effect from crop year to crop year 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 May 29, 2008, and unanimously recommended 
2008-09 expenditures of $176,384 and an assessment rate of $0.60 per 
hundredweight of California dates. In comparison, last year's budgeted 
expenditures were $209,182. The assessment rate of $0.75 is $0.15 lower 
than the rate previously in effect. The Committee recommended a lower 
assessment rate because the 2007 crop was larger than expected, 
resulting in excess assessment income and thus a larger reserve. Income 
generated through the lower assessment rate combined with reserve funds 
should be sufficient to cover anticipated 2008-09 expenses.
    Section 987.72(c) states that the reserve may not exceed 50 percent 
of the average of expenses incurred during the most recent five 
preceding crop years. With the larger 2007 crop, the reserve at the end 
of the 2007-08 crop year is projected to exceed this limit. Excess 
assessment funds will be refunded to handlers to reduce the reserve and 
bring it in line with order requirements.
    Proceeds from sales of cull dates are deposited in a surplus 
account for subsequent use by the Committee in covering the surplus 
pool share of the Committee's expenses. Handlers may also dispose of 
cull dates of their own production within their own livestock-feeding 
operation; otherwise, such cull dates must be shipped or delivered to 
the Committee for sale to non-human food product outlets. Pursuant to 
Sec.  987.72(b), the Committee is authorized to temporarily use funds 
derived from assessments to defray expenses incurred in disposing of 
surplus dates. All such expenses are required to be deducted from 
proceeds obtained by the Committee from the disposal of surplus dates. 
For the 2008-09 crop year, the Committee estimated that $4,500 from the 
surplus account would be needed to temporarily defray expenses incurred 
in disposing of surplus dates.
    The major expenditures recommended by the Committee for the 2008-09 
crop year include $66,384 for general and administrative programs, 
$82,000 for promotional programs, and $28,000 for marketing and media 
consulting. The Committee also budgeted $10,000 as a contingency 
reserve for other marketing and promotion projects that it may wish to 
support later in the year. By comparison, expenditures recommended by 
the Committee for the 2007-08 crop year include $87,312 for general and 
administrative programs, $67,870 for promotional programs, $24,000 for 
marketing and media consulting, $5,000 for moving expenses, and $5,000 
for updating marketing materials. The Committee budgeted $20,000 as a 
contingency reserve for other marketing and promotion projects.
    The assessment rate of $0.60 per hundredweight of assessable dates 
was derived by applying the following formula where:

A = 2007-08 estimated reserve on 09/30/08 ($134,757);
B = 2008-09 estimated reserve on 10/01/09 ($78,996);

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C = 2008-09 expenses ($176,384);
D = Cull Surplus Fund ($4,500);
E = Assessment Refund ($15,877); and
F = 2008-09 expected shipments (22,000,000 pounds).
[(B-A+C-D+E)/F] *100.

    The assessment rate established in this rule 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 
crop year 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 2008-09 budget and those 
for subsequent crop years 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 rule 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 85 producers of dates in the production 
area and 9 handlers subject to regulation under the marketing order. 
The Small Business Administration (13 CFR 121.201) defines small 
agricultural producers as those having annual receipts of less than 
$750,000, and small agricultural service firms are defined as those 
having annual receipts of less than $7,000,000.
    According to the National Agricultural Statistics Service (NASS), 
data for the 2006 crop year shows that about 3.12 tons, or 6,240 
pounds, of dates were produced per acre. The 2006 grower price 
published by the NASS was $1,320 per ton, or $.66 per pound. Thus, the 
value of date production per acre in 2006 averaged about $4,118 (6,240 
pounds times $.66 per pound). At that average price, a producer would 
have to farm over 182 acres to receive an annual income from dates of 
$750,000 ($750,000 divided by $4,118 per acre equals 182 acres). 
According to Committee staff, the majority of California date producers 
farm less than 182 acres. Thus, it can be concluded that the majority 
of date producers could be considered small entities. The majority of 
handlers of California dates may also be considered small entities.
    This rule continues in effect the action that decreased the 
assessment rate established for the Committee and collected from 
handlers for the 2008-09 and subsequent crop years from $0.75 to $0.60 
per hundredweight of dates handled. The Committee unanimously 
recommended 2008-09 expenditures of $176,384 and an assessment rate of 
$0.60 per hundredweight of dates, which is $0.15 lower than the 2007-08 
rate, previously in effect. The quantity of assessable dates for the 
2008-09 crop year is estimated at 22,000,000 pounds. Thus, the $0.60 
per hundredweight assessment rate should provide $132,000 in assessment 
income and, with reserve funds of $39,884 and the $4,500 contribution 
from the surplus program, will be adequate to meet the 2008-09 crop 
year expenses.
    The major expenditures recommended by the Committee for the 2008-09 
crop year include $66,384 for general and administrative programs, 
$82,000 for promotional programs, and $28,000 for marketing and media 
consulting. The Committee also budgeted $10,000 as a contingency 
reserve for other marketing and promotion projects that it may wish to 
support later in the year.
    The Committee recommended a lower assessment rate because the 2007 
crop was larger than expected, resulting in excess assessment income 
and thus a larger reserve. Income generated through the lower 
assessment rate combined with reserve funds should be sufficient to 
cover anticipated 2008-09 expenses.
    The Committee reviewed and unanimously recommended 2008-09 crop 
year expenditures of $176,384. Prior to arriving at this budget, the 
Committee considered information from various sources, such as the 
Committee's Marketing Subcommittee. Alternative expenditure levels were 
an option available to the Committee, but given the extra assessment 
income generated from the larger-than-expected 2007-08 crop, it was 
ultimately determined that a $176,384 budget would be appropriate. The 
assessment rate of $0.60 per hundredweight of dates was then derived, 
based upon the Committee's estimates of the incoming reserve, income, 
and anticipated expenses.
    According to the NASS, the season average grower price for 2007 
crop dates is projected at $2,290 per ton, or $114 per hundredweight. 
No official NASS estimate is available yet for 2008. The average grower 
price for 2005-07 is $1,953 per ton, or $98 per hundredweight.
    To calculate the percentage of grower revenue represented by the 
assessment rate for 2007, the assessment rate of $0.75 (per 
hundredweight) is divided by the estimated average grower price. This 
results in estimated assessment revenue for the 2007-08 crop year as a 
percentage of grower revenue of 0.66 percent ($0.75 divided by $114 per 
hundredweight). As previously mentioned, NASS data for 2008 is not yet 
available. However, applying the same calculations above using the 
average grower price for 2005-07 would result in estimated assessment 
revenue as a percentage total grower revenue of .61 percent for the 
2008-09 crop year ($0.60 divided by $98 per hundredweight). Thus, the 
assessment revenue should be well below 1 percent of estimated grower 
revenue in 2008.
    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 California 
date industry and all interested persons were invited to attend the 
meeting and participate in Committee deliberations on all issues. Like 
all Committee meetings, the May 29, 2008, 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 California date 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.
    AMS is committed to complying with the E-Government Act, to promote 
the use of the Internet and other

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information technologies to provide increased opportunities for citizen 
access to Government information and services, and for other purposes.
    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.
    An interim final rule concerning this action was published in the 
Federal Register on August 26, 2008 (73 FR 50188). Copies of that rule 
were also mailed or sent via facsimile to all date 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 on October 27, 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/AMSv1.0/ams.fetchTemplateData.do?template=TemplateN&page=MarketingOrdersSmallBusinessGuide. 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 987

    Dates, Marketing agreements, Reporting and recordkeeping 
requirements.

PART 987--DATES PRODUCED OR PACKED IN RIVERSIDE COUNTY, CALIFORNIA

0
Accordingly, the interim final rule amending 7 CFR part 987 which was 
published at 73 FR 50188 on August 26, 2008, is adopted as a final rule 
without change.

    Dated: December 8, 2008.
James E. Link,
Administrator, Agricultural Marketing Service.
[FR Doc. E8-29597 Filed 12-12-08; 8:45 am]
BILLING CODE 3410-02-P