[Federal Register Volume 79, Number 37 (Tuesday, February 25, 2014)]
[Proposed Rules]
[Pages 10423-10426]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-03852]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 945

[Doc. No. AMS-FV-13-0093; FV14-945-1 PR]


Irish Potatoes Grown in Certain Designated Counties in Idaho, and 
Malheur County, Oregon; Decreased Assessment Rate

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule.

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SUMMARY: This proposed rule would decrease the assessment rate 
established for the Idaho-Eastern Oregon Potato Committee (Committee) 
for the 2014-2015 and subsequent fiscal periods from $0.0045 to $0.0025 
per hundredweight of potatoes handled. The Committee locally 
administers the marketing order, which regulates the handling of 
potatoes grown in certain designated counties in

[[Page 10424]]

Idaho, and Malheur County, Oregon. Assessments upon potato 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 would remain in effect indefinitely unless modified, 
suspended, or terminated.

DATES: Comments must be received by March 27, 2014.

ADDRESSES: Interested persons are invited to submit written comments 
concerning this proposed rule. Comments must be sent to the Docket 
Clerk, Marketing Order and Agreement Division, Fruit and Vegetable 
Program, AMS, USDA, 1400 Independence Avenue SW., STOP 0237, 
Washington, DC 20250-0237; Fax: (202) 720-8938; or Internet: http://www.regulations.gov. Comments should reference the document number and 
the date and page number of this issue of the Federal Register and will 
be available for public inspection in the Office of the Docket Clerk 
during regular business hours, or can be viewed at: http://www.regulations.gov. All comments submitted in response to this 
proposed rule will be included in the record and will be made available 
to the public. Please be advised that the identity of the individuals 
or entities submitting the comments will be made public on the internet 
at the address provided above.

FOR FURTHER INFORMATION CONTACT: Sue Coleman, Marketing Specialist, or 
Gary D. Olson, Regional Director, Northwest Marketing Field Office, 
Marketing Order and Agreement Division, Fruit and Vegetable Program, 
AMS, USDA; Telephone: (503) 326-2724, Fax: (503) 326-7440, or Email: 
[email protected] or [email protected].
    Small businesses may request information on complying with this 
regulation by contacting Jeffrey Smutny, Marketing Order and Agreement 
Division, Fruit and Vegetable Program, AMS, USDA, 1400 Independence 
Avenue SW., STOP 0237, Washington, DC 20250-0237; Telephone: (202) 720-
2491, Fax: (202) 720-8938, or Email: [email protected].

SUPPLEMENTARY INFORMATION: This proposed rule is issued under Marketing 
Agreement No. 98 and Order No. 945, both as amended (7 CFR part 945), 
regulating the handling of Irish potatoes grown in certain designated 
counties in Idaho, and Malheur County, Oregon, 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 proposed rule 
in conformance with Executive Order 12866 and Executive Order 13563.
    This proposed rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. Under the marketing order now in effect, Idaho-
Eastern Oregon potato handlers are subject to assessments. Funds to 
administer the order are derived from such assessments. It is intended 
that the assessment rate as proposed herein would be applicable to all 
assessable potatoes beginning August 1, 2014, and continue until 
amended, suspended, or terminated.
    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 proposed rule would decrease the assessment rate established 
for the Committee for the 2014-2015 and subsequent fiscal periods from 
$0.0045 to $0.0025 per hundredweight of potatoes.
    The Idaho-Eastern Oregon potato 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 
Idaho-Eastern Oregon potatoes. 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 2013-2014 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 November 21, 2013, to consider the Committee's 
projected 2014-2015 budget, the size of the Committee's operating 
reserve, and the order's continuing assessment rate. The Committee 
unanimously recommended an assessment rate of $0.0025 per hundredweight 
of potatoes for the 2014-2015 fiscal period. The assessment rate of 
$0.0025 is $0.002 lower than the rate currently in effect. The 
assessment rate decrease is necessary to reduce the funds held in 
reserve to less than approximately one fiscal period's budgeted 
expenses, the maximum level allowed by the order.
    The Committee expects to recommend budgeted expenditures of 
$112,883 for the 2014-2015 fiscal period at its next scheduled meeting 
in June of 2014. In comparison, 2013-2014 budgeted expenditures were 
$101,662. The major expenditures projected by the Committee for the 
2014-2015 fiscal period include $62,743 for administrative expenses; 
$35,140 for travel/office expenses; and $15,000 for a marketing order 
contingency fund. Budgeted expenses for these items in 2013-2014 were 
$62,022, $35,640, and $4,000, respectively.
    The assessment rate recommended by the Committee was derived by 
dividing anticipated expenses by expected shipments of Idaho-Eastern 
Oregon potatoes. Potato shipments for 2014-2015 are estimated at 32 
million hundredweight which should provide $80,000 in assessment 
income. Income derived from handler assessments, along with reimbursed 
expenses, interest earned, and funds from the Committee's authorized 
reserve, would be adequate to cover budgeted expenses. Funds in the 
reserve (projected to be $168,084 on July 31, 2014) would be reduced to 
comply with the maximum permitted by the order of approximately one 
fiscal period's expenses.
    The proposed assessment rate would 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 would be in effect for an indefinite 
period, the Committee would 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

[[Page 10425]]

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 would evaluate Committee recommendations and other 
available information to determine whether modification of the 
assessment rate is needed. Further rulemaking would be undertaken as 
necessary. The Committee's 2014-2015 budget and those for subsequent 
fiscal periods would be reviewed and, as appropriate, approved by USDA.

Initial Regulatory Flexibility Analysis

    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA) (5 U.S.C. 601-612), the Agricultural Marketing Service (AMS) 
has considered the economic impact of this proposed rule 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 
businesses 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 450 producers of potatoes in the production 
area and approximately 32 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 $7,000,000.
    During the 2012-2013 fiscal period, the most recent for which 
statistics are available, 35,148,900 hundredweight of Idaho-Eastern 
Oregon potatoes were inspected under the order and sold into the fresh 
market. Based on information provided by the National Agricultural 
Statistics Service, the average producer price for the 2012 Idaho 
potato crop was $6.55 per hundredweight. Multiplying $6.55 by the 
shipment quantity of 35,148,900 hundredweight yields an annual crop 
revenue estimate of $230,225,295. The average annual fresh potato 
revenue for each of the 450 producers is therefore calculated to be 
$511,612 ($230,225,295 divided by 450), which is less than the Small 
Business Administration's threshold of $750,000. Consequently, on 
average most all of the Idaho-Eastern Oregon potato producers may be 
classified as small entities.
    In addition, based on information reported by USDA's Market News 
Service, the average f.o.b. shipping point price for the 2012 Idaho 
potato crop was $5.87 per hundredweight. Multiplying $5.87 by the 
shipment quantity of 35,148,900 hundredweight yields an annual crop 
revenue estimate of $206,324,043. The average annual fresh potato 
revenue for each of the 32 handlers is therefore calculated to be 
$6,447,626 ($206,324,043 divided by 32), which is less than the Small 
Business Administration's threshold of $7,000,000. Consequently, on 
average most all of the Idaho-Eastern Oregon potato handlers may be 
classified as small entities.
    This proposed rule would decrease the assessment rate established 
for the Committee and collected from handlers for the 2014-2015 and 
subsequent fiscal periods from $0.0045 to $0.0025 per hundredweight of 
potatoes. The Committee unanimously recommended an assessment rate of 
$0.0025 per hundredweight of potatoes for the 2014-2015 fiscal period. 
The assessment rate of $0.0025 is $0.002 lower than the 2013-2014 rate. 
The quantity of assessable potatoes for the 2014-2015 fiscal period is 
estimated at 32 million hundredweight. Thus, the $0.0025 rate should 
provide $80,000 in assessment income. Income derived from handler 
assessments, along with reimbursed expenses, interest earned, and funds 
from the Committee's authorized reserve, would be adequate to cover 
budgeted expenses.
    The Committee expects to recommend $112,883 in budgeted 
expenditures for the 2014-2015 fiscal period at its next scheduled 
meeting in June of 2014. In comparison, 2013-2014 budgeted expenditures 
were $101,662. The major expenditures projected by the Committee for 
the 2014-2015 year include $62,743 for administrative expenses; $35,140 
for travel/office expenses; and $15,000 for the marketing order 
contingency fund. Budgeted expenses for these items in 2013-2014 were 
$62,022, $35,640, and $4,000, respectively.
    The lower assessment rate is necessary to reduce the reserve 
balance to less than approximately one fiscal period's budgeted 
expenses. The reserve balance on July 31, 2014, is projected to be 
$168,084. Assessment income for the 2014-2015 fiscal period is 
estimated at $80,000, while expenses are estimated to be $112,883. The 
Committee anticipates compensating for the reduced assessment revenue 
with $4,300 from reimbursed expenses, $100 from interest income, and 
$28,483 from its reserve fund. The reserve fund is projected to exceed 
the maximum authorized level by $26,718 at the end of the 2014-2015 
fiscal period. However, it was noted that it is possible that the 
Committee may receive less assessments than estimated, as well as incur 
unanticipated expenses. In addition, the Committee expects to draw 
funds from the reserve in subsequent fiscal periods that would further 
reduce the balance.
    The Committee discussed alternatives to this proposed change, 
including other assessment rate levels and leaving the current rate in 
place. Prior to arriving at this assessment rate recommendation, the 
Committee considered information from the Board's Executive Committee 
on the cost savings resulting from recent administrative changes in the 
Committee office and the level of anticipated Committee expenses moving 
forward. The Committee debated between an assessment rate of $0.003 and 
$0.0025 per hundredweight of potatoes. Based on the market and shipping 
quantities, the Committee recommended the rate of $0.0025 per 
hundredweight. The Committee believes assessment income combined with 
income from reimbursed expenses, interest income, and funds from the 
Committee's financial reserve, would provide sufficient funds to meet 
its expenses.
    A review of historical information and preliminary information 
pertaining to the upcoming fiscal period indicates that the producer 
price for the 2014-2015 crop could range between $6.55 and $8.10 per 
hundredweight of potatoes. Therefore, the estimated assessment revenue 
for the 2014-2015 fiscal period as a percentage of total producer 
revenue could range between 0.03 and 0.04 percent.
    This action would decrease 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 would reduce the burden on handlers, and may reduce the 
burden on producers. In addition, the Committee's meeting was widely 
publicized throughout the Idaho-Eastern Oregon potato industry and all 
interested persons were invited to attend the meeting and participate 
in Committee deliberations on all issues. Like all Committee meetings, 
the November 21, 2013, meeting was a public meeting and all entities, 
both large and small, were able to express views on this issue. 
Finally, interested persons are invited to submit comments on this 
proposed rule, including the

[[Page 10426]]

regulatory and informational impacts of this action on small 
businesses.
    In accordance with the Paperwork Reduction Act of 1995, (44 U.S.C. 
Chapter 35), the order's information collection requirements have been 
previously approved by the Office of Management and Budget (OMB) and 
assigned OMB No. 0581-0178 (Generic Vegetable and Specialty Crops). No 
changes in those requirements as a result of this action are necessary. 
Should any changes become necessary, they would be submitted to OMB for 
approval.
    This proposed rule would impose no additional reporting or 
recordkeeping requirements on either small or large Idaho-Eastern 
Oregon potato 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 information technologies to provide 
increased opportunities for citizen access to Government information 
and services, and for other purposes.
    USDA has not identified any relevant Federal rules that duplicate, 
overlap, or conflict with this action.
    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/MarketingOrdersSmallBusinessGuide. Any questions 
about the compliance guide should be sent to Jeffrey Smutny at the 
previously mentioned address in the FOR FURTHER INFORMATION CONTACT 
section.
    A 30-day comment period is provided to allow interested persons to 
respond to this proposed rule. Thirty days is deemed appropriate 
because: (1) The 2014-2015 fiscal period begins on August 1, 2014, and 
the marketing order requires that the rate of assessment for each 
fiscal period apply to all assessable potatoes handled during such 
fiscal period; (2) the proposed rule would decrease the assessment rate 
for assessable potatoes beginning with the 2014-2015 fiscal period; and 
(3) handlers are aware of this action which was unanimously recommended 
by the Committee at a public meeting and is similar to other assessment 
rate actions issued in past years.

List of Subjects in 7 CFR Part 945

    Marketing agreements, Potatoes, Reporting and recordkeeping 
requirements.

    For the reasons set forth in the preamble, 7 CFR part 945 is 
proposed to be amended as follows:

PART 945--IRISH POTATOES GROWN IN CERTAIN DESIGNATED COUNTIES IN 
IDAHO, AND MALHEUR COUNTY, OREGON

0
1. The authority citation for 7 CFR part 945 continues to read as 
follows:

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

0
2. Section 945.249 is revised to read as follows:


Sec.  945.249  Assessment rate.

    On and after August 1, 2014, an assessment rate of $0.0025 per 
hundredweight is established for Idaho-Eastern Oregon potatoes.

    Dated: February 18, 2014.
Rex A. Barnes,
Associate Administrator, Agricultural Marketing Service.
[FR Doc. 2014-03852 Filed 2-24-14; 8:45 am]
BILLING CODE 3410-02-P