[Federal Register Volume 80, Number 227 (Wednesday, November 25, 2015)]
[Rules and Regulations]
[Pages 73642-73644]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-30018]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 966

[Doc. No. AMS-FV-15-0058; FV15-966-1 IR]


Tomatoes Grown in Florida; Decreased Assessment Rate

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Interim rule with request for comments.

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SUMMARY: This rule implements a recommendation from the Florida Tomato 
Committee (Committee) for a decrease in the assessment rate established 
for the 2015-16 and subsequent fiscal periods from $0.0375 to $0.03 per 
25-pound carton of tomatoes handled under the marketing order (order). 
The Committee locally administers the order and is comprised of 
producers of tomatoes operating within the area of production. 
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 November 27, 2015. Comments received by January 25, 
2016, will be considered prior to issuance of a final rule.

ADDRESSES: Interested persons are invited to submit written comments 
concerning this rule. Comments must be sent to the Docket Clerk, 
Marketing Order and Agreement Division, Specialty Crops 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 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: Steven Kauffman, Marketing Specialist 
or Christian D. Nissen, Regional Director, Southeast Marketing Field 
Office, Marketing Order and Agreement Division, Specialty Crops 
Program, AMS, USDA; Telephone: (863) 837-3375, Fax: (863) 291-8614, or 
Email: [email protected] or [email protected].
    Small businesses may request information on complying with this 
regulation by contacting Jeffery Smutny, Marketing Order and Agreement 
Division, Specialty Crops 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 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 Orders 12866, 13563, and 13175.
    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 Florida tomatoes 
beginning August 1, 2015, 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 rule decreases the assessment rate established for the 
Committee for the 2015-16 and subsequent fiscal periods from $0.0375 to 
$0.03 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 2013-14 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

[[Page 73643]]

submitted by the Committee or other information available to USDA.
    The Committee met on August 25, 2015, and unanimously recommended 
2015-16 expenditures of $1,513,177 and an assessment rate of $0.03 per 
25-pound carton of tomatoes. In comparison, last year's budgeted 
expenditures were $1,823,925. The assessment rate of $0.03 is $0.0075 
lower than the rate currently in effect. The budget recommended for 
2015-16 include decreases in education and promotion expenditures and 
personnel costs. The Committee recommended decreasing the assessment 
rate to more closely align assessment income to the lower budget.
    The major expenditures recommended by the Committee for the 2015-16 
year include $435,377 for salaries, $400,000 for education and 
promotion, and $400,000 for research. Budgeted expenses for these items 
in 2014-15 were $498,500, $750,000, and $300,000, respectively.
    The assessment rate recommended by the Committee was derived by 
reviewing anticipated expenses, shipments, funds from block grants, 
interest income, and available reserves. Florida tomato shipments for 
the year are estimated at 33 million 25-pound cartons which should 
provide $990,000 in assessment income. Income derived from handler 
assessments, along with funds from the Committee's authorized reserve, 
interest income, and funds from block grants, will be adequate to cover 
budgeted expenses. Funds in the reserve (currently $1,136,195) will be 
kept within the maximum permitted by the order of not to exceed one 
fiscal period's expenses as authorized in Sec.  966.44.
    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 
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 2015-16 budget and those 
for subsequent fiscal periods will 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 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 100 producers of tomatoes in the production 
area and approximately 80 handlers subject to regulation under the 
marketing order. Small agricultural producers are defined by the Small 
Business Administration (SBA) as those having annual receipts of 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 2014-15 season was approximately 
$10.58 per 25-pound container, and total fresh shipments for the 2014-
15 season were approximately 36.5 million cartons. Based on the average 
price, about 80 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 decreases the assessment rate established by the 
Committee and collected from handlers for the 2015-16 and subsequent 
fiscal periods from $0.0375 to $0.03 per 25-pound carton of tomatoes. 
The Committee unanimously recommended 2015-16 expenditures of 
$1,513,177 and an assessment rate of $0.03 per 25-pound carton. The 
assessment rate of $0.03 is $0.0075 lower than the 2013-14 rate. The 
quantity of assessable tomatoes for the 2015-16 season is estimated at 
33 million cartons. Thus, the $0.03 rate should provide $990,000 in 
assessment income. Income derived from handler assessments, along with 
funds from the Committee's authorized reserve, interest income, and 
funds from block grants, will be adequate to cover budgeted expenses.
    The major expenditures recommended by the Committee for the 2015-16 
year include $435,377 for salaries, $400,000 for education and 
promotion, and $400,000 for research. Budgeted expenses for these items 
in 2014-15 were $498,500, $750,000, and $300,000, respectively. The 
Committee recommended a decrease in the assessment rate based on a 
reduction in expenditures for education and promotion, and personnel 
expenses.
    Prior to arriving at this budget and assessment rate, the Committee 
considered information from various sources, such as the Committee 
Executive Subcommittee, Research Subcommittee, and Education and 
Promotion Subcommittee. Alternative expenditure levels were discussed 
by these groups, based upon the relative value of various activities to 
the tomato industry. The Committee ultimately determined that 
assessment revenue, along with grant funds, funds from reserves and 
interest income, would generate sufficient revenue to meet its 
expenses.
    A review of historical information and preliminary information 
pertaining to the upcoming crop year indicates that the average grower 
price for the 2015-16 season may be around $10.50 per 25-pound carton 
of tomatoes. Therefore, the estimated assessment revenue for the 2015-
16 crop year as a percentage of total grower revenue could be 
approximately 0.3 percent.
    This action decreases 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. 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 25, 2015, 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 interim rule, including the regulatory and informational 
impacts of this action on small businesses.

[[Page 73644]]

    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 Vegetable and Specialty Crops. No changes in 
those requirements are necessary as a result of this action. Should any 
changes become necessary, they would be submitted to OMB for approval.
    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.
    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 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/rules-regulations/moa/small-businesses. Any questions 
about the compliance guide should be sent to Jeffery Smutny 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 is also found and determined upon good 
cause that it is impracticable, unnecessary, and contrary to the public 
interest to give preliminary notice prior to putting this rule into 
effect, and that good cause exists for not postponing the effective 
date of this rule until 30 days after publication in the Federal 
Register because: (1) The 2015-16 fiscal period began on August 1, 
2015, and the marketing order requires that the rate of assessment for 
each fiscal period apply to all assessable Florida tomatoes handled 
during such fiscal period; (2) the Committee needs to have sufficient 
funds to pay its expenses which are incurred on a continuous basis and 
this action decreases the assessment rate for assessable tomatoes 
beginning with the 2015-16 fiscal period; (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; and (4) this interim rule provides a 60-day comment 
period, and all comments timely received will be considered prior to 
finalization of this rule.

List of Subjects in 7 CFR Part 966

    Marketing agreements, Reporting and recordkeeping requirements, 
Tomatoes.

    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, 2015, an assessment rate of $0.03 per 25-
pound container is established for Florida tomatoes.

    Dated: November 20, 2015.
Rex A. Barnes,
Associate Administrator, Agricultural Marketing Service.
[FR Doc. 2015-30018 Filed 11-24-15; 8:45 am]
BILLING CODE P