[Federal Register Volume 83, Number 41 (Thursday, March 1, 2018)]
[Proposed Rules]
[Pages 8802-8804]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-04010]
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Proposed Rules
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains notices to the public of
the proposed issuance of rules and regulations. The purpose of these
notices is to give interested persons an opportunity to participate in
the rule making prior to the adoption of the final rules.
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Federal Register / Vol. 83, No. 41 / Thursday, March 1, 2018 /
Proposed Rules
[[Page 8802]]
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 925
[Doc. No. AMS-SC-17-0082; SC18-925-1 PR]
Grapes Grown in a Designated Area of Southeastern California;
Decreased Assessment Rate
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Proposed rule.
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SUMMARY: This proposed rule would implement a recommendation from the
California Desert Grape Administrative Committee (Committee) to
decrease the assessment rate established for the 2018 fiscal period and
subsequent fiscal periods. This proposed rule also makes administrative
revisions to the subpart headings to bring the language into
conformance with the Office of Federal Register requirements.
DATES: Comments must be received by April 2, 2018.
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, 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
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: Maria Stobbe, 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 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 action, pursuant to 5 U.S.C. 553,
proposes an amendment to regulations issued to carry out a marketing
order as defined in 7 CFR 900.2(j). This proposed rule is issued under
Marketing Agreement No. 925 and Order No. 925, as amended (7 CFR part
925), regulating the handling of grapes grown in a designated area of
southeastern California. Part 925 (referred to as 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
Committee locally administers the Order and is comprised of producers
and handlers of grapes operating within the area of production, and a
member of the public.
The Department of Agriculture (USDA) is issuing this rule in
conformance with Executive Orders 13563 and 13175. This action falls
within a category of regulatory actions that the Office of Management
and Budget (OMB) exempted from Executive Order 12866 review.
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'[thinsp]'' (February 2, 2017).
This proposed rule has been reviewed under Executive Order 12988,
Civil Justice Reform. Under the Order now in effect, grape handlers in
a designated area of southeastern California are subject to
assessments. Funds to administer the Order are derived from such
assessments. Assessment fees charged to grape handlers are used by the
Committee to fund reasonable and necessary expenses of the program. It
is intended that the assessment rate as proposed herein would be
applicable to all assessable grapes beginning on January 1, 2018, 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 for the 2018
and subsequent fiscal periods from $0.030 to $0.020 per 18-pound lug of
grapes 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 producers and handlers of grapes grown in a designated
area of southeastern California, and a member of the public. 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 and subsequent fiscal periods the Committee
recommended, and USDA approved, an assessment rate
[[Page 8803]]
of $0.030 per 18-pound lug of grapes. That rate would continue in
effect 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 30, 2017 and unanimously recommended
2018 fiscal year expenditures of $119,000, with an estimated cash
reserve of $115,000, and an assessment rate of $0.020 per 18-pound lug
of grapes. In comparison, last fiscal year's budgeted expenditures were
$108,500. The assessment rate of $.020 is $0.010 lower than the rate
currently in effect. The 2017 crop, at the higher assessment rate
currently in effect, provided more income than required to cover
expenses, resulting in an estimated cash reserve of $140,000. The cash
reserves are sufficient to supplement this fiscal year's revenues at an
assessment rate of $0.020 per 18-pound lug of grapes to fully fund the
recommended 2018 budgeted expenditures.
The major expenditures recommended by the Committee for the 2018
fiscal year include $65,000 for management and compliance services,
$25,500 in office expenditures, and $28,500 for research. Budgeted
expenses for these items in fiscal year 2017 were $50,000 for
management and compliance services, $28,330 in office expenditures, and
$28,500 for research.
The assessment rate recommended by the Committee was derived by
considering anticipated expenses, expected shipments of grapes in the
production area, and the level of funds in the authorized reserve.
Grape shipments for fiscal year 2018 are estimated at 4,700,000 18-
pound lugs, which should provide $94,000 in assessment income. Income
derived from handler assessments, along with interest income and funds
from the Committee's authorized reserve, would be adequate to cover
budgeted expenses. Funds in the reserve (currently $140,000) would be
reduced by $25,000 and would be within the maximum permitted by the
Order. Section 925.42(a)(2) authorizes the Committee to carry over
excess funds into subsequent fiscal years provided that funds in the
reserve not exceed approximately one fiscal period's expenses. The
Committee may utilize the reserve funds to defray expenses during any
fiscal period. The Committee proposes to utilize approximately $25,000
of its carry-over reserve funds to fully fund the fiscal year 2018
proposed budget, while assessing the new fiscal year 2018 crop at the
proposed lower rate; thereby maintaining the carry-over reserve fund
within the authorized limit allowed by the Order.
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 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 budget for fiscal year 2018
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 38 producers of grapes in the production
area and approximately 14 handlers subject to regulation under the
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 $7,500,000 (13 CFR 121.201).
Eleven of the 14 handlers subject to the Order have annual grape
sales of less than $7,500,000, according to USDA Market News Service
and Committee data. In addition, information from the Committee and
USDA's Market News indicates that at least ten of 38 producers have
annual receipts of less than $750,000. Thus, it may be concluded that a
majority of the grape handlers regulated under the Order and about ten
of the producers could be classified as small entities under the SBA's
definitions.
This proposal would decrease the assessment rate collected from
handlers for the 2018 and subsequent fiscal periods from $0.030 to
$0.020 per 18-pound lug of grapes. The Committee unanimously
recommended fiscal year 2018 expenditures of $119,000 and an assessment
rate of $0.020 per 18-pound lug. The proposed assessment rate of $0.020
is $0.010 lower than the 2017 rate. The quantity of assessable
commodity for the 2018 fiscal year is estimated at 4,700,000 18-pound
lugs. Thus, the $0.020 rate should provide $94,000 in assessment
income. That amount plus the use of reserve funds of $25,000 should be
adequate to meet this 2018 fiscal year's expenses. Income derived from
handler assessments, along with interest income and funds from the
Committee's authorized reserve, would be adequate to cover budgeted
expenses.
The major expenditures recommended by the Committee for the 2018
fiscal year include $65,000 for management and compliance services,
$25,500 in office expenditures, and $28,500 for research. Budgeted
expenses for these items in 2017 were $50,000 for management and
compliance services, $28,330 in office expenditures, and $28,500 for
research.
Funds in the reserve (currently $140,000) would be reduced by
$25,000 to be within the maximum permitted by the Order. Section 925.42
provides the Committee authority to carry over excess funds into
subsequent fiscal years provided that funds in the reserve do not
exceed approximately one fiscal period's expenses. The Committee is
authorized to utilize the excess funds to defray expenses during any
fiscal period. The Committee proposes to utilize approximately $25,000
of its carry-over reserve funds to fully fund the 2018 proposed budget,
while assessing the new 2018 crop at the proposed lower rate; thereby
maintaining the carry-over reserve fund within the authorized limit
stated in the Order, approximately one fiscal period's expenses.
Prior to arriving at this budget and assessment rate, the Committee
considered various options, such as maintaining the current assessment
rate and expenditure levels. Alternative expenditure levels were
discussed by the Committee, based upon the relative value of various
activities to the grape
[[Page 8804]]
industry. The Committee ultimately determined that 2018 expenditures of
$119,000 were appropriate, and the recommended assessment rate and the
use of $25,000 from the carry-over financial reserves would provide
sufficient revenue to meet its expenses.
A review of historical crop and price information, as well as
preliminary information pertaining to the upcoming fiscal period,
indicates that the shipping point price for the 2017 season averaged
about $21.62 per 18-pound lug of California desert grapes handled. If
the 2018 price is similar to the 2017 price, estimated assessment
revenue as a percentage of total estimated handler revenue would be
0.09 percent for the 2018 season ($0.020 divided by $21.62 per 18-pound
lug).
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 production area. The grape 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 30, 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
proposed rule, including the regulatory and information collection
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. 0581-0189. 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 proposed rule would impose no additional reporting or
recordkeeping requirements on either small or large southeastern
California grape 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/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.
A 30-day comment period is provided to allow interested persons to
respond to this proposed rule. All written comments timely received
will be considered before a final determination is made on this rule.
List of Subjects in 7 CFR Part 925
Grapes, Marketing agreements, Reporting and recordkeeping
requirements.
For the reasons set forth in the preamble, 7 CFR part 925 is
proposed to be amended as follows:
PART 925--GRAPES GROWN IN A DESIGNATED AREA OF SOUTHEASTERN
CALIFORNIA
0
1. The authority citation for part 925 continues to read as follows:
Authority: 7 U.S.C. 601-674.
0
2. Sections 925.1 through 925.69 are designated as subpart A under a
heading to read as follows:
Subpart A--Order Regulating Handling [Subpart Redesignated as
Subpart B and Amended]
0
3. Redesignate ``Subpart--Rules and Regulations'' as subpart B and
revise the heading to read as follows:
Subpart B--Administrative Requirements [Subpart Redesignated as
Subpart C]
0
4. Redesignate ``Subpart--Assessment Rates'' as ``Subpart C Assessment
Rates''.
0
5. Section 925.215 is revised to read as follows:
Sec. 925.215 Assessment rate.
On and after January 1, 2018, an assessment rate of $0.020 per 18-
pound lug is established for grapes grown in a designated area of
southeastern California.
Dated: February 22, 2018.
Bruce Summers,
Acting Administrator, Agricultural Marketing Service.
[FR Doc. 2018-04010 Filed 2-28-18; 8:45 am]
BILLING CODE 3410-02-P