[Federal Register Volume 81, Number 38 (Friday, February 26, 2016)]
[Rules and Regulations]
[Pages 9741-9743]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-04049]



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  Federal Register / Vol. 81, No. 38 / Friday, February 26, 2016 / 
Rules and Regulations  

[[Page 9741]]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 983

[Doc. No. AMS-FV-15-0038; FV15-983-1 FR]


Pistachios Grown in California, Arizona, and New Mexico; 
Increased Assessment Rate

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

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SUMMARY: This rule implements a recommendation from the Administrative 
Committee for Pistachios (Committee) for an increase of the assessment 
rate established for the 2015-16 and subsequent production years from 
$0.0005 to $0.0035 per pound of assessed weight pistachios handled 
under the marketing order for pistachios grown in California, Arizona, 
and New Mexico. The Committee locally administers the order and is 
comprised of producers and handlers of pistachios operating within the 
area of production. Assessments upon pistachio handlers are used by the 
Committee to fund reasonable and necessary expenses of the program. The 
production year begins on September 1 and ends August 31. The 
assessment rate would remain in effect indefinitely unless modified, 
suspended, or terminated.

DATES: Effective February 29, 2016.

FOR FURTHER INFORMATION CONTACT: Peter Sommers, Marketing Specialist, 
or Jeffrey Smutny, Regional Director, California Marketing Field 
Office, Marketing Order and Agreement Division, Specialty Crops 
Program, AMS, USDA; Telephone: (559) 487-5901, Fax: (559) 487-5906, or 
Email: [email protected] or [email protected].
    Small businesses may request information on complying with this 
regulation by contacting Antoinette Carter, 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 and Order No. 983, as amended (7 CFR part 983), regulating 
the handling of pistachios grown in California, Arizona, and New 
Mexico, 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 Orders 12866, 13563, and 13175.
    This rule has been reviewed under Executive Order 12988, Civil 
Justice Reform. Under the marketing order now in effect, California, 
Arizona, and New Mexico pistachio 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 pistachios beginning on September 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 increases the assessment rate established for the 
Committee for the 2015-16 and subsequent production years from $0.0005 
to $0.0035 per pound of assessed weight pistachios handled.
    The California, Arizona, and New Mexico pistachio 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, Arizona, and New Mexico 
pistachios. 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 2011-12 and subsequent production years, the Committee 
recommended, and the USDA approved, an assessment rate that would 
continue in effect from production year to production 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 July 9, 2015, and October 20, 2015, and 
unanimously recommended 2015-16 production year expenditures of 
$1,056,402 and an assessment rate of $0.0035 per pound of assessed 
weight pistachios handled to fund Committee expenses. This represents 
an increase over the prior year's budget and assessment rate. In 
comparison, last year's budgeted expenditures were $1,001,400. The 
assessment rate of $0.0035 is $0.0030 higher than the rate currently in 
effect. The Committee's recommended 2015-16 expenditures are $55,002 
higher than last year's budgeted expenditures. The primary reason for 
the increase is to provide $560,000 in funding for Sterile Insect 
Technology/Navel Orange Worm (SIT/NOW) research. When applied to the 
Committee's crop estimate for the 2015-16 production year of 265 
million pounds, the current assessment rate of $0.0005 would not 
generate sufficient income to cover anticipated expenses. The 
assessment rate of $0.0035 per pound of assessed weight pistachios 
would generate assessment income of $927,500. Anticipated assessment

[[Page 9742]]

income combined with financial reserves and other income would provide 
sufficient revenue for the Committee to meet its budgeted expenses 
while maintaining its financial reserve within the limit authorized 
under the order.
    The major expenditures recommended by the Committee for the 2015-16 
production year include $560,000 for SIT/NOW research, $92,401 for 
administrative expenses, $314,000 for salary and related employee 
expenses, $10,000 for compliance expenses, and $80,000 for a 
contingency fund. Budgeted expenses in 2014-15 were $360,000 for 
Technical Assistance Specialty Crop (TASC) Program research, $125,000 
for other research, $117,400 for administrative expenses, $314,000 for 
salary and related employee expenses, $10,000 for compliance expenses, 
and $75,000 for a contingency fund. Actual expenses in 2014-15 were 
significantly lower, at $547,199, as the TASC research was not funded.
    The assessment rate recommended by the Committee was derived by 
considering anticipated expenses and production levels of California, 
Arizona, and New Mexico pistachios, and other pertinent factors. As 
mentioned earlier, pistachio production levels are estimated at 265 
million pounds, which should generate $927,500 in assessment income. 
Income derived from handler assessments, along with other income and 
financial reserves would provide sufficient revenue for the Committee 
to meet its budgeted expenses while maintaining its financial reserve 
within the limit authorized under the order.
    The assessment rate established in this rule will continue in 
effect indefinitely unless modified, suspended, or terminated by USDA 
based upon a 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 
production 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 would 
be undertaken as necessary. The Committee's 2015-16 budget and those 
for subsequent production years would be reviewed and, as appropriate, 
approved by USDA.

Final 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 final 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 1,152 producers of pistachios in the 
production area and approximately 19 handlers subject to regulation 
under the marketing order. Small agricultural producers are defined by 
the Small Business Administration 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 Committee data, it is estimated that about 47 percent of 
the handlers annually ship less than $7,000,000 worth of pistachios, 
and it is also estimated that 68 percent of the producers have annual 
receipts less than $750,000. Thus, the majority of handlers in the 
production area may be classified as large entities, and the majority 
of the producers may be classified as small entities.
    This rule increases the assessment rate established for the 
Committee and collected from handlers for the 2015-16 and subsequent 
production years from $0.0005 to $0.0035 per pound of assessed weight 
pistachios. The Committee unanimously recommended 2015-16 expenditures 
of $1,056,402 and an assessment rate of $0.0035 per pound of assessed 
weight pistachios. The assessment rate of $0.0035 is $0.0030 higher 
than the 2014-15 rate. The quantity of assessable pistachios for the 
2015-16 production year is estimated at 265 million pounds. Thus, the 
$0.0035 rate should provide $927,500 in assessment income. Income 
derived from handler assessments, along with other income and financial 
reserves would provide sufficient revenue for the Committee to meet its 
budgeted expenses while maintaining its financial reserve within the 
limit authorized under the order.
    The major expenditures recommended by the Committee for the 2015-16 
production year include $560,000 for SIT/NOW research, $92,401 for 
administrative expenses, $314,000 for salary and related employee 
expenses, $10,000 for compliance expenses, and $80,000 for a 
contingency fund. Budgeted expenses in 2014-15 were $360,000 for TASC 
Program research, $125,000 for other research, $117,400 for 
administrative expenses, $314,000 for salary and related employee 
expenses, $10,000 for compliance expenses, and $75,000 for a 
contingency fund. The reasons for the proposed increase include a 
significant increase in budgeted expenses in 2015 over actual expenses 
in 2014, a significantly smaller crop estimate in 2015, and allocation 
of funds for Sterile Insect Technology/Navel Orange Worm (SIT/NOW) 
research.
    Prior to arriving at this budget and assessment rate, the Committee 
considered alternative expenditure levels but ultimately determined 
that 2015-16 expenditures of $1,056,402 were appropriate and that the 
current assessment rate would generate insufficient revenue to meet its 
expenses.
    According to data from the National Agricultural Statistics 
Service, the season average producer price was $3.48 per pound of 
assessed weight pistachios in 2013 and $3.10 per pound in 2014. A 
review of historical information and preliminary information pertaining 
to the upcoming production year indicates that the producer price for 
the 2015-16 production year could range between $3.48 and $3.10 per 
pound of assessed weight pistachios. Therefore, the estimated 
assessment revenue for the 2015-16 production year as a percentage of 
total producer revenue could range between 0.10 and 0.11 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. These costs are 
offset by the benefits derived from the operation of the marketing 
order. In addition, the Committee's meeting was widely publicized 
throughout the California, Arizona, and New Mexico pistachio industry, 
and all interested persons were invited to attend the meeting and 
participate in Committee deliberations on all issues. Like all 
Committee meetings, the July 9, 2015, and October 20, 2015, meetings 
were public and all entities, both large

[[Page 9743]]

and small, were able to express views on this issue.
    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. 0581-0215. 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 rule imposes no additional reporting or recordkeeping 
requirements on either small or large California, Arizona, and New 
Mexico pistachio 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.
    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 December 14, 2015. Copies of the proposed rule were also 
mailed or sent via facsimile to all California, Arizona, and New Mexico 
pistachio handlers. Finally, the proposal was made available through 
the Internet by USDA and the Office of the Federal Register. A 15-day 
comment period ending December 29, 2015, 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/rules-regulations/moa/small-businesses. Any questions 
about the compliance guide should be sent to Antoinette Carter 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: (1) The 
2015-16 production year began on September 1, 2015 and the marketing 
order requires that the rate of assessment for each production year 
apply to all assessable pistachios handled during such production year; 
(2) the Committee needs to have sufficient funds to pay its expenses, 
which are incurred on a continuous basis; (3) handlers are aware of 
this rule which was recommended at a public meeting and is similar to 
assessment rate actions issued in past years. Also, a 15-day comment 
period was provided in the proposed rule, and no comments were 
received.

List of Subjects in 7 CFR Part 983

    Marketing agreements, Pistachios, Reporting and recordkeeping 
requirements.
    For the reasons set forth in the preamble, 7 CFR part 983 is 
amended as follows:

PART 983--PISTACHIOS GROWN IN CALIFORNIA, ARIZONA, and NEW MEXICO

0
1. The authority citation for 7 CFR part 983 continues to read as 
follows:

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


0
2. In Sec.  983.253, paragraph (a) is revised to read as follows:


Sec.  983.253  Assessment rate.

    (a) On and after September 1, 2015, an assessment rate of $0.0035 
per pound is established for California, Arizona, and New Mexico 
pistachios.
* * * * *

    Dated: February 22, 2016.
Elanor Starmer,
Acting Administrator, Agricultural Marketing Service.
[FR Doc. 2016-04049 Filed 2-25-16; 8:45 am]
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