[Federal Register Volume 74, Number 6 (Friday, January 9, 2009)]
[Rules and Regulations]
[Pages 855-857]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-174]



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  Federal Register / Vol. 74, No. 6 / Friday, January 9, 2009 / Rules 
and Regulations  

[[Page 855]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 966

[Docket No. AMS-FV-08-0081; FV08-966-1 FR]


Tomatoes Grown In Florida; Increased Assessment Rate

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

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SUMMARY: This rule increases the assessment rate established for the 
Florida Tomato Committee (Committee) for the 2008-09 and subsequent 
fiscal periods from $0.0325 to $0.0375 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: January 12, 2009.

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 final 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.''
    The Department of Agriculture (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 on August 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 increases the assessment rate established for the 
Committee for the 2008-09 and subsequent fiscal periods from $0.0325 to 
$0.0375 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 2007-08 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 14, 2008, and unanimously recommended 
2008-09 expenditures of $2,438,200 and an assessment rate of $0.0375 
per 25-pound carton of tomatoes. In comparison, last year's budgeted 
expenditures were $2,101,000. The assessment rate of $0.0375 is $0.005 
higher than the rate currently in effect. The assessment increase is 
needed to offset the 2008-09 increase in education and promotion 
expenses, salaries, and employee retirement. Without the increase in 
the assessment rate, the Committee will need to utilize an additional 
$250,000 from the authorized reserve. Therefore, the Committee voted to 
increase the assessment rate.
    The major expenditures recommended by the Committee for the 2008-09 
year include $1,200,000 for education and promotion, $505,500 for 
salaries, $320,000 for research, and $77,000 for employee retirement. 
Budgeted expenses for these items in 2007-08 were $900,000, $467,000, 
$320,000, and $71,000, respectively.
    The assessment rate recommended by the Committee was derived by 
dividing anticipated expenses, less anticipated funds from the USDA 
Market Access Program (MAP), by expected shipments of Florida tomatoes. 
Tomato shipments for the year are estimated at 50 million 25-pound 
cartons and should provide $1,875,000 in assessment income.

[[Page 856]]

Income derived from handler assessments, along with interest income, 
MAP funds, and funds from the Committee's authorized reserve, will be 
adequate to cover budgeted expenses. Funds in the reserve (currently 
approximately $593,000) will be kept within the maximum permitted by 
the order of not to exceed one fiscal period's expenses as stated in 
Sec.  966.44 of the order.
    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 will be in effect 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 2008-09 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 (5 U.S.C. 601-612) (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 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 (SBA) as those having annual receipts less than 
$750,000, and small agricultural service firms are defined as those 
whose annual receipts are less than $7,000,000 (13 CFR 121.201).
    Based on industry and Committee data, the average annual price for 
fresh Florida tomatoes during the 2007-08 season was approximately 
$13.71 per 25-pound container, and total fresh shipments for the 2007-
08 season were 45,177,457 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 increases the assessment rate established for the 
Committee and collected from handlers for the 2008-09 and subsequent 
fiscal periods from $0.0325 to $0.0375 per 25-pound carton of tomatoes. 
The Committee unanimously recommended 2008-09 expenditures of 
$2,438,200 and an assessment rate of $0.0375 per 25-pound carton. The 
assessment rate of $0.0375 is $0.005 higher than the 2007-08 rate. The 
quantity of assessable tomatoes for the 2008-09 season is estimated at 
50 million 25-pound cartons. Thus, the $0.0375 rate should provide 
$1,875,000 in assessments. Income derived from handler assessments, 
along with interest income and funds from the Committee's authorized 
reserve, and other income, should be adequate to cover budgeted 
expenses.
    The major expenditures recommended by the Committee for the 2008-09 
year include $1,200,000 for education and promotion, $505,500 for 
salaries, $320,000 for research, and $77,000 for employee retirement. 
Budgeted expenses for these items in 2007-08 were $900,000, $467,000, 
$320,000, and $71,000, respectively.
    The assessment increase is needed to offset the 2008-09 increase in 
education and promotion expenses, salaries, and employee retirement. 
Without the increase in the assessment rate, the Committee would need 
to utilize an additional $250,000 from the authorized reserve. 
Therefore, the Committee voted to increase the assessment rate.
    The Committee reviewed and unanimously recommended 2008-09 
expenditures of $2,438,200, which included increases in education and 
promotion, salaries, and employee retirement. 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 education and promotion projects to 
the tomato industry. The assessment rate of $0.0375 per 25-pound 
container of assessable tomatoes was determined by examining the 
anticipated expenses, expected shipments, MAP funds, and available 
reserves. The recommended assessment rate should generate $1,875,000 in 
income. Considering income from assessments, interest, and other 
sources, total income will be approximately $27,000 below the 
anticipated expenses, which the Committee determined to be acceptable.
    A review of historical information and preliminary information 
pertaining to the 2008-09 fiscal period indicates that the grower price 
for the 2008-09 season could range between $7.98 and $12.95 per 25-
pound carton of tomatoes. Therefore, the estimated assessment revenue 
for the 2008-09 season as a percentage of total grower revenue could 
range between 0.3 and 0.5 percent.
    This action increases the assessment obligation imposed on 
handlers. While assessments impose some additional costs on handlers, 
the costs are minimal and uniform on all handlers. Some of the 
additional costs may be passed on to producers. However, these costs 
are offset by the benefits derived by the operation of the marketing 
order. 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 
14, 2008, meeting was a public meeting and all entities, both large and 
small, were able to express views on this issue.
    This rule 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. As noted in the 
initial regulatory flexibility analysis, USDA has not identified any 
relevant Federal rules that duplicate, overlap, or conflict with this 
final rule.

[[Page 857]]

    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.
    A proposed rule concerning this action was published in the Federal 
Register on October 20, 2008 (73 FR 62218). Copies of the proposed rule 
were mailed or sent via facsimile to all Committee members and Florida 
tomato handlers. Finally, the proposal was made available through the 
Internet by USDA and the Office of the Federal Register. A 30-day 
comment period ending November 19, 2008, was provided for interested 
persons to respond to the proposal. 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.
    Pursuant to 5 U.S.C. 553, it also found and determined that good 
cause exists for not postponing the effective date of this rule until 
30 days after publication in the Federal Register because handlers are 
already receiving tomatoes from the 2008-09 crop, and the marketing 
order requires that the rate of assessment for each fiscal period apply 
to all assessable tomatoes handled during such period. In addition, the 
Committee needs to have sufficient funds to pay its expenses which are 
incurred on a continuous basis. Further, handlers are aware of this 
rule which was recommended at a public meeting. Also, a 30-day comment 
period was provided for in the proposed rule.

List of Subjects in 7 CFR Part 966

    Marketing agreements, Reporting and recordkeeping requirements, 
Tomatoes.

0
For the reasons set forth in the preamble, 7 CFR part 966 is amended as 
follows:

PART 966--TOMATOES GROWN IN FLORIDA

0
1. The authority citation for 7 CFR part 966 continues to read as 
follows:

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


0
2. Section 966.234 is revised to read as follows:


Sec.  966.234  Assessment Rate.

    On and after August 1, 2008, an assessment rate of $0.0375 per 25-
pound carton is established for Florida tomatoes.

    Dated: January 5, 2009.
James E. Link,
Administrator, Agricultural Marketing Service.
[FR Doc. E9-174 Filed 1-8-09; 8:45 am]
BILLING CODE 3410-02-P