[Federal Register Volume 82, Number 178 (Friday, September 15, 2017)]
[Rules and Regulations]
[Pages 43297-43299]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-19553]



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 Rules and Regulations
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  Federal Register / Vol. 82, No. 178 / Friday, September 15, 2017 / 
Rules and Regulations  

[[Page 43297]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 922

[Doc. No. AMS-SC-17-0033; SC17-922-1 IR]


Apricots Grown in Designated Counties in Washington; 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 Washington 
Apricot Marketing Committee (Committee) for a decrease in the 
assessment rate established for the 2017-2018 and subsequent fiscal 
periods from $1.40 to $1.00 per ton of apricots handled. The Committee 
locally administers the marketing order and is comprised of growers and 
handlers of apricots operating within the area of production. 
Assessments upon apricot handlers are used by the Committee to fund 
reasonable and necessary expenses of the program. The fiscal period 
begins April 1 and ends March 31. The assessment rate will remain in 
effect indefinitely unless modified, suspended, or terminated.

DATES: Effective September 18, 2017. Comments received by November 14, 
2017, 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: Dale Novotny, Marketing Specialist, or 
Gary D. Olson, Regional Director, Northwest Marketing Field Office, 
Marketing Order and Agreement Division, Specialty Crops 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 Richard Lower, 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. 922, both as amended (7 CFR part 922), 
regulating the handling of apricots grown in designated counties in 
Washington, 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 13563, and 13175.
    This rule does not meet the definition of a significant regulatory 
action contained in section 3(f) of Executive Order, and is not subject 
to review by the Office of Management and Budget (OMB). Additionally, 
because this rule does not meet the definition of a significant 
regulatory action it does not trigger the requirements contained in 
Executive Order 13771. See OMB's Memorandum titled ``Interim Guidance 
Implementing Section 2 of the Executive Order of January 30, 2017, 
titled `Reducing Regulation and Controlling Regulatory Costs' '' 
(February 2, 2017).
    This rule has been reviewed under Executive Order 12988, Civil 
Justice Reform. Under the marketing order now in effect, Washington 
apricot 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 
apricots beginning April 1, 2017, 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 under the order 
for the 2017-2018 and subsequent fiscal periods from $1.40 to $1.00 per 
ton of apricots handled.
    The 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 growers and handlers of Washington apricots. 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 2016-2017 and subsequent fiscal periods, the Committee 
recommended, and USDA approved, an assessment rate of $1.40 per ton of 
apricots handled, that would continue

[[Page 43298]]

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 May 3, 2017, and unanimously recommended 2017-
2018 fiscal period expenditures of $8,225 and a decreased assessment 
rate of $1.00 per ton of apricots handled. In comparison, 2016-2017 
fiscal period's budgeted expenditures were $7,160. The assessment rate 
of $1.00 per ton is $0.40 lower than the rate currently in effect.
    Favorable growing conditions led to a 2016 crop which was 1,028 
tons higher than estimated by the Committee. The extra revenue from the 
larger than anticipated crop during the 2016-2017 fiscal period, 
combined with lower than anticipated expenses, resulted in a $3,064 
increase in the Committee's financial reserve.
    The major expenditures recommended by the Committee for the 2017-
2018 fiscal period include $4,000 in management contract services; 
$2,000 for the annual audit; $1,300 for Committee travel expenses; $500 
for technological services, software, and equipment; and $425 in 
miscellaneous office expenses. Budgeted expenses for these items in the 
2016-2017 fiscal period were $3,000, $2,000, $1,200, $500, and $460, 
respectively.
    The assessment rate recommended by the Committee was derived by 
dividing anticipated expenses by expected shipments of Washington 
apricots. After an open discussion with growers, handlers, and industry 
personnel, the Committee established a crop estimate for the 2017-2018 
fiscal period of 6,000 tons. The Committee considered the crop 
estimate, the recommended 2017-2018 fiscal period expenses, and the 
Committee's financial reserve when it recommended the assessment rate 
decrease.
    The estimated 6,000 tons of apricot shipments should provide $6,000 
in assessment income at the $1.00 per ton assessment rate. Income 
derived from handler assessments, along with interest income and funds 
from the Committee's authorized reserve, will be adequate to cover 
budgeted expenses.
    Sections 922.42(a)(2) and 922.142 of the order authorize the 
Committee to carry over excess funds into subsequent marketing years as 
a reserve, provided that funds do not exceed approximately one year's 
operational expenses. The Committee's financial reserve balance was 
$10,365 on March 31, 2017, the end of the 2016-2017 fiscal period. The 
Committee anticipates a reserve balance of $8,140 at the end of the 
2017-2018 fiscal period, a level which would be within the maximum 
permitted by 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 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 2017-2018 budget, and those 
for subsequent fiscal periods, will be reviewed and, as appropriate, 
approved by USDA.

Regulatory Flexibility Act

    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 17 Washington apricot handlers subject to 
regulation under the order and approximately 100 apricot growers in the 
regulated production area. Small agricultural service firms (handlers) 
are defined by the Small Business Administration (SBA) as those whose 
annual receipts are less than $7,500,000, and small agricultural 
producers (growers) are defined as those having annual receipts less 
than $750,000 (13 CFR 121.201).
    Committee reports indicate that the industry shipped 6,028 tons of 
Washington apricots over the 2016-2017 fiscal period. Based on 
information from the USDA's Market News Service, 2016 f.o.b. prices for 
Washington No. 1 apricots ranged from $18.00 to $23.00 per 24-pound 
container, for both loose pack and 2-layer tray-pack containers. Using 
those prices, and the shipment information provided by the Committee, 
the approximate total value of Washington apricot shipments likely 
ranged between $9.0 million and $11.6 million, with the average revenue 
per handler ranging from $532,000 to $680,000. It is therefore 
determined that most, if not all, of the Washington apricot handlers 
ship less than $7,500,000 worth of apricots on an annual basis.
    In addition, using shipment data from the Committee and the 2016 
National Agricultural Statistics Service (NASS) average freight on 
board (f.o.b.) price of $1,210 per ton for fresh apricots, total 
revenue for Washington apricot growers for the 2016-2017 fiscal period 
is estimated to be approximately $7.3 million. Based on these reports 
and the number of apricot growers within the production area, it is 
estimated that the average per grower revenue from the sale of apricots 
in 2016 was approximately $73,000. In view of the foregoing, it is 
concluded that most of the handlers and growers of Washington apricots 
may be classified as small entities.
    This rule decreases the assessment rate collected from handlers, 
for the 2017-2018 and subsequent fiscal periods from $1.40 to $1.00 per 
ton of apricots. The Committee unanimously recommended 2017-2018 
expenditures of $8,225. The assessment rate of $1.00 per ton is $0.40 
lower than the previously established rate.
    The quantity of assessable apricots for the 2017-2018 fiscal period 
is estimated at 6,000 tons. Thus, the $1.00 per ton rate should provide 
$6,000 in assessment income. Income derived from handler assessments, 
along with interest income and funds from the Committee's authorized 
reserve, will be adequate to cover budgeted expenses.
    The major expenditures recommended by the Committee for the 2017-
2018 fiscal period include $4,000 in management contract services; 
$2,000 for the annual audit; $1,300 for Committee travel expenses; $500 
for technological services, software, and equipment; and $425 for 
miscellaneous office expenses. Budgeted expenses for these items in the 
2016-2017 fiscal period were $3,000, $2,000, $1,200, $500, and $460, 
respectively.
    The assessment rate recommended by the Committee was derived by 
dividing anticipated expenses by expected

[[Page 43299]]

shipments of Washington apricots. After an open discussion with 
growers, handlers, and industry personnel, the Committee established a 
crop estimate for the 2017-2018 fiscal period of 6,000 tons. The 
Committee considered the crop estimate, the recommended 2017-2018 
fiscal period expenses, and the Committee's financial reserve when it 
recommended the assessment rate decrease.
    Prior to arriving at this budget and assessment rate, the Committee 
considered information from various sources, such as a presentation 
from representatives of the Washington Stone Fruit Commission and 
comments from other industry participants. Alternative expenditure 
levels and assessment rates were discussed by these groups, based upon 
the relative value of various activities to the apricot industry. The 
Committee ultimately determined that the recommended budget was 
appropriate and that assessments at $1.00 per ton, along with interest 
income and the authorized reserve fund, would generate sufficient 
revenue to meet those budgeted expenses.
    A review of historical information and preliminary information 
pertaining to the upcoming fiscal period indicates that the grower 
price for the 2017-2018 season could range between $800 and $1,600 per 
ton of apricots. Therefore, the estimated assessment revenue for the 
2017-2018 fiscal period as a percentage of total grower revenue could 
range between 0.06 and 0.13 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 growers. However, decreasing the 
assessment rate reduces the burden on handlers, and may reduce the 
burden on growers. In addition, the Committee's meeting was widely 
publicized throughout the Washington apricot 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 3, 2017, 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.
    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 OMB and assigned OMB No. 0581-0178; 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 action imposes no additional reporting or recordkeeping 
requirements on either small or large Washington apricot 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 Richard Lower 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) This action decreases the assessment rate for 
assessable apricots beginning with the 2017-2018 fiscal period; (2) 
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 (3) 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 922

    Apricots, Marketing agreements, Reporting and recordkeeping 
requirements.

    For the reasons set forth in the preamble, 7 CFR part 922 is 
amended as follows:

PART 922--APRICOTS GROWN IN DESIGNATED COUNTIES IN WASHINGTON

0
1. The authority citation for part 922 continues to read as follows:

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


0
2. Section 922.235 is revised to read as follows:


Sec.  922.235   Assessment rate.

    On and after April 1, 2017, an assessment rate of $1.00 per ton is 
established for Washington apricots handled in the production area.

    Dated: September 11, 2017.
Bruce Summers,
Acting Administrator, Agricultural Marketing Service.
[FR Doc. 2017-19553 Filed 9-14-17; 8:45 am]
 BILLING CODE 3410-02-P