[Federal Register Volume 86, Number 161 (Tuesday, August 24, 2021)]
[Proposed Rules]
[Pages 47248-47251]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-18067]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 915

[Doc. No. AMS-SC-21-0040]


Avocados Grown in South Florida; Increased Assessment Rate

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule.

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SUMMARY: This proposed rule would implement an Avocado Administrative 
Committee recommendation to increase the assessment rate established 
for the 2021-22 and subsequent fiscal years. The proposed assessment 
rate would remain in effect indefinitely unless modified, suspended, or 
terminated.

DATES: Comments must be received by September 23, 2021.

ADDRESSES: Interested persons are invited to submit written comments 
concerning this proposed rule. Comments must be submitted on the 
internet at: https://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

[[Page 47249]]

inspection in the Office of the Docket Clerk during regular business 
hours, or can be viewed at: https://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 individuals or entities submitting comments will be 
made public on the internet at the address provided above.

FOR FURTHER INFORMATION CONTACT: Abigail Campos, Marketing Specialist, 
or Christian D. Nissen, Regional Director, Southeast Marketing Field 
Office, Marketing Order and Agreement Division, Specialty Crops 
Program, AMS, USDA; Telephone: (863) 324-3375, Fax: (863) 291-8614, 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, 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. 121 and Marketing Order No. 915, both as 
amended (7 CFR part 915), regulating the handling of avocados grown in 
south Florida. Part 915, (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 Avocado 
Administrative Committee (Committee) locally administers the Order and 
is comprised of growers and handlers operating within the area of 
production, and a public member.
    The Department of Agriculture (USDA) is issuing this proposed rule 
in conformance with Executive Orders 12866 and 13563. Executive Orders 
12866 and 13563 direct agencies to assess all costs and benefits of 
available regulatory alternatives and, if regulation is necessary, to 
select regulatory approaches that maximize net benefits (including 
potential economic, environmental, public health and safety effects, 
distributive impacts and equity). Executive Order 13563 emphasizes the 
importance of quantifying both costs and benefits, reducing costs, 
harmonizing rules, and promoting flexibility. This action falls within 
a category of regulatory actions that the Office of Management and 
Budget (OMB) exempted from Executive Order 12866 review.
    This proposed rule has been reviewed under Executive Order 13175--
Consultation and Coordination with Indian Tribal Governments, which 
requires agencies to consider whether their rulemaking actions would 
have tribal implications. AMS has determined that this proposed rule is 
unlikely to have substantial direct effects on one or more Indian 
tribes, on the relationship between the Federal Government and Indian 
tribes, or on the distribution of power and responsibilities between 
the Federal Government and Indian tribes.
    This proposed rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. Under the marketing Order now in effect, Florida 
avocado 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 Florida avocados for the 2021-22 fiscal year, 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 increase the assessment rate established 
for the Committee for the 2021-22 and subsequent fiscal years from 
$0.35 to $0.45 per 55-pound bushel container of avocados.
    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. Nine of ten 
members of the Committee are producers and handlers of Florida 
avocados. They are familiar with the Committee's needs and with costs 
for goods and services in their local area and are able to formulate an 
appropriate budget and assessment rate. The assessment rate is 
formulated and discussed in a public meeting and all directly affected 
persons have an opportunity to participate and provide input.
    For the 2016-17 and subsequent fiscal years, the Committee 
recommended, and USDA approved, an assessment rate that would continue 
in effect from fiscal year to fiscal 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 April 14, 2021 and recommended 2021-22 
expenditures of $348,484 and an assessment rate of $0.45 per 55-pound 
bushel container of avocados. In comparison, last year's budgeted 
expenditures were $280,484. The assessment rate of $0.45 is $0.10 
higher than the rate currently in effect. During the last few seasons, 
the Committee has not funded research projects. However, the laurel 
wilt disease continues to challenge the avocado industry. The Committee 
discussed the need for research funding and added $80,000 to its 
proposed budget for this research and recommended increasing the 
assessment rate to cover the additional expense. At the current 
assessment rate, assessment income would equal only $280,000, an amount 
insufficient to cover the Committee's anticipated expenditures of 
$348,484. By increasing the assessment rate by $0.10, assessment income 
would be $360,000. This amount should provide sufficient funds to meet 
2021-2022 anticipated expenses.
    Major expenditures recommended by the Committee for the 2021-22 
year include $116,164 for salaries, $80,000 for research, and $53,350 
for employee benefits. Budgeted expenses for these items in 2020-21 
were $116,164, $0, and $53,350, respectively.
    The assessment rate recommended by the Committee was derived by 
reviewing anticipated expenses, expected shipments of Florida avocados, 
and the amount of funds in reserve. Avocado shipments for the year are 
estimated at 800,000 55-pound bushel containers, which, as mentioned 
before, should provide $360,000 in assessment income (80,000 containers 
x $0.45). Income derived from handler assessments at the proposed rate, 
along with interest income, should be adequate to cover budgeted 
expenses. Funds in the reserve (currently about $250,000) are expected 
to be kept within the maximum permitted by the Order

[[Page 47250]]

(approximately three fiscal years' expenses as authorized in Sec.  
915.42).
    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 will continue to meet prior to or during each 
fiscal year to recommend a budget of expenses and consider 
recommendations for modification of the assessment rate. 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 2021-22 budget and those 
for subsequent fiscal years 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 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 325 producers of Florida avocados in the 
production area and 25 handlers subject to regulation under the 
marketing order. Small agricultural producers are defined by the Small 
Business Administration (SBA) as those having annual receipts less than 
$1,000,000, and small agricultural service firms are defined as those 
whose annual receipts are less than $30,000,000 (13 CFR 121.201).
    According to the National Agricultural Statistical Service (NASS), 
the average grower price paid for Florida avocados during the 2020-21 
season was $21.97 per 55-pound bushel. Utilized production was 
equivalent to 624,364 55-pound bushels for a total value of over 
$13,718,830. Dividing the crop value by the estimated number of 
producers (325) yields an estimated average receipt per producer of 
$42,212, so the majority of producers would have annual receipts of 
less than $1,000,000.
    USDA Market News reported April 2021 terminal market prices for 
green skinned avocados were about $36.43 per 24-pound container. Using 
this price and the total utilization, the total 2020-21 handler crop 
value is estimated at $52.1 million. Dividing this figure by the number 
of handlers (25) yields an estimated average annual handler receipts of 
over $2 million, which is below the SBA threshold for small 
agricultural service firms. Thus, the majority of Florida avocado 
producers and handlers are classified as small entities.
    This proposal would increase the assessment rate established for 
the Committee and collected from handlers for the 2021-22 and 
subsequent fiscal years from $0.35 to $0.45 per 55-pound bushel 
container of avocados. The Committee recommended 2021-22 expenditures 
of $348,484 and an assessment rate of $0.45 per 55-pound bushel 
container. The proposed assessment rate of $0.45 is $0.10 higher than 
the previous rate. The quantity of assessable avocados for the 2021-22 
season is estimated at 800,000 55-pound bushel containers. Thus, the 
$0.45 rate should provide $360,000 in assessment income and be adequate 
to meet this year's expenses.
    Major expenditures recommended by the Committee for the 2021-22 
fiscal year include $116,164 for salaries, $80,000 for research, and 
$53,350 for employee benefits. Budgeted expenses for these items in 
2020-21 were $116,164, $0, and $53,350, respectively.
    In recent years, the Committee did not fund any research. However, 
Committee members believe further research is needed to address laurel 
wilt disease and voted to commit $80,000 to research in the coming 
fiscal year. At the current assessment rate and with the 2021-22 crop 
estimated to be 800,000 55-pound bushel containers, assessment income 
would equal only $280,000, an amount insufficient to cover the 
Committee's anticipated expenditures of $348,484. By increasing the 
assessment rate by $0.10, assessment income would be approximately 
$360,000. This amount should provide sufficient funds to meet 2021-22 
anticipated expenses. Consequently, the Committee recommended 
increasing the assessment rate.
    Prior to arriving at this budget and assessment rate, the Committee 
considered information from various sources, including its Research 
Subcommittee. The Committee discussed alternative expenditure levels 
based upon the relative value of various activities to the south 
Florida avocado industry. The Committee ultimately determined that 
2021-22 expenditures of $348,484, including additional funds for 
research, were appropriate, and the recommended assessment rate, along 
with interest income, should generate sufficient revenue to meet its 
expenses.
    A review of historical information and preliminary information 
pertaining to the upcoming season indicates that the grower price for 
the 2021-22 season should be around $20-25 per 55-pound bushel 
container of avocados. Therefore, the estimated assessment revenue for 
the 2021-22 fiscal year as a percentage of total grower revenue would 
be between 1.8 and 2.25 percent.
    This action would increase the assessment obligation imposed on 
handlers. While assessments impose some additional costs on handlers, 
these costs are minimal and uniform on all handlers. Additionally, 
these costs would be offset by benefits derived by the operation of the 
marketing order.
    The Committee's meeting was widely publicized throughout the 
Florida avocado industry and all interested persons were invited to 
attend the meeting and participate in Committee deliberations on all 
issues. Like all Committee meetings, the April 14, 2021 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 
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. 0581-0189 Fruit Crops. No changes in those 
requirements would be necessary as a result of this proposed rule. 
Should any changes become necessary, they would be submitted to OMB for 
approval.
    This proposed rule would not impose any additional reporting or 
recordkeeping requirements on either small or large Florida avocado 
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.

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    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: 
https://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.

List of Subjects in 7 CFR Part 915

    Avocados, Marketing agreements, Reporting and recordkeeping 
requirements.

    For reasons set forth in the preamble, 7 CFR part 915 is proposed 
to be amended as follows:

PART 915--AVOCADOS GROWN IN SOUTH FLORIDA

0
1. The authority citation for 7 CFR part 915 continues to read as 
follows:

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

0
2. Section 915.235 is revised to read as follows:


Sec.  915.235  Assessment rate.

    On and after April 1, 2021, an assessment rate of $0.45 per 55-
pound container or equivalent is established for avocados grown in 
South Florida.

Erin Morris,
Associate Administrator, Agricultural Marketing Service.
[FR Doc. 2021-18067 Filed 8-23-21; 8:45 am]
BILLING CODE P