[Federal Register Volume 86, Number 163 (Thursday, August 26, 2021)]
[Proposed Rules]
[Pages 47599-47601]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-17912]


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 Proposed Rules
                                                 Federal Register
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 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. 86, No. 163 / Thursday, August 26, 2021 / 
Proposed Rules  

[[Page 47599]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 987

[Doc. No. AMS-SC-21-0056; SC21-987-1 PR]


Domestic Dates Produced or Packed in Riverside County, 
California; Increased 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 Date Administrative Committee to increase the assessment 
rate for the 2020-21 and subsequent crop years. The assessment rate 
would remain in effect indefinitely unless modified, suspended, or 
terminated.

DATES: Comments must be received by September 10, 2021.

ADDRESSES: Interested persons are invited to submit comments concerning 
this proposed rule. Comments must be submitted via the internet at: 
http://www.regulations.gov. All comments should reference the document 
number and the date and page number of this issue of the Federal 
Register. All comments submitted in response to this proposed rule will 
be included in the record and 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: Barry Broadbent, Senior Marketing 
Specialist, Northwest Marketing Field Office, Marketing Order and 
Agreement Division, Specialty Crops Program, AMS, USDA; Telephone: 
(503) 326-2724, or Email: [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 Order No. 987, as amended (7 CFR part 987), regulating the 
handling of domestic dates produced or packed in Riverside County, 
California. Part 987, (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 California 
Date Administrative Committee (Committee) locally administers the Order 
and is comprised of producers and producer-handlers operating within 
the area of production.
    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 Order now in effect, California date 
handlers are subject to assessments. Funds to administer the Order are 
derived from such assessments. It is intended that the assessment rate 
would be applicable to all assessable dates for the 2020-21 crop 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 (7 U.S.C. 608(15)(A)), 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.
    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. Members are 
familiar with the Committee's needs and costs of goods and services in 
their local area, and they can 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.
    This proposed rule would increase the assessment rate from $0.15 
per hundredweight, the rate that was established for the 2018-19 and 
subsequent crop years, to $0.20 per hundredweight of dates handled for 
the 2020-21 and subsequent crop years. The Committee met on June 25, 
2020, and unanimously recommended increasing the assessment rate to 
fund necessary administrative expenses and maintain a sufficient 
operating reserve. The rate increase should provide sufficient funds to 
cover most of the Committee's 2020-21 crop year budgeted expenses, with 
the balance coming from other revenue sources and reserve funds.

[[Page 47600]]

    The Committee estimates the 2020-21 domestic date crop to be 
32,000,000 pounds (320,000 hundredweight), which would generate $64,000 
in assessment income at the recommended $0.20 per hundredweight 
assessment rate. The Committee expects other income of approximately 
$5,000. Total income of $69,000, combined with $6,250 from the 
financial reserve, should provide enough funds to cover 2020-21 crop 
year budgeted expenditures. Reserve funds remaining at the end of the 
2020-21 crop year are expected to be $28,750.
    The Committee's budget for the 2020-21 crop year is estimated to be 
$75,250. Committee's expenses include $47,000 for management, $19,250 
for office administration, and $9,000 for the financial audit. In 
comparison, the previous crop year's total budget was $74,200, and the 
administrative expenses were $43,000, $21,200, and $10,000, 
respectively.
    The assessment rate recommended by the Committee was derived by 
considering anticipated expenses, the expected volume of dates handled, 
and the amount of funds available in the operating reserve. Income 
derived from handler assessments of $64,000 (320,000 hundredweight 
assessed at the proposed rate of $0.20) should be adequate to cover 
most budgeted expenses of $75,250, with the balance covered from $5,000 
in other income and $6,250 from reserve funds. After expending $6,250, 
the ending 2020-21 crop year balance in the financial reserve is 
expected to be $28,750, which would be less than the average of the 
annual expenses of the preceding five years, as mandated by Sec.  
987.72(d).
    The assessment rate proposed in this rule 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 
crop 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. 
Meetings are public and held virtually or in a hybrid style with 
participants having a choice whether to attend in person or virtually. 
All 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 subsequent crop 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 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 70 date producers in the production area 
and 11 date handlers subject to regulation under the Order. The Small 
Business Administration defines small agricultural producers as those 
having annual receipts of less than $1,000,000, and small agricultural 
service firms as those whose annual receipts are less than $30,000,000. 
(13 CFR 121.201)
    According to the National Agricultural Statistics Service (NASS), 
data for the most-recently completed crop year (2019) shows that 
producer price for fresh market California dates was $4,130 per ton. 
With the estimated 16,000-ton crop, the total farm gate value for 
California date producers was approximately $66,080,000 (16,000 times 
$4,130). Therefore, the average fresh market date revenue for the 70 
producers within the production area would be about $944,000 
($66,080,000 divided by 70). Thus, assuming a normal bell-curve 
distribution of receipts among producers, AMS estimates the majority of 
producers would qualify as small businesses under the SBA definition.
    Furthermore, USDA Market News reported an average terminal market 
price of $50.88 per 11-pound carton for the 2019-20 crop year. With 
approximately 32,000,000 pounds handled, the industry would have 
shipped an estimated 2,909,091 11-pound cartons (32,000,000 divided by 
11) of packaged dates for a total value of $148,014,550 (2,909,091 
times $50.88). With 11 date handlers within the production area, the 
average revenue per handler is estimated to be $13,455,868 for the 
2019-20 crop year ($148,014,550 divided by 11). Thus, most California 
date handlers would be considered small businesses under the SBA 
definition.
    This proposed rule would increase the assessment rate collected 
from handlers for the 2020-21 and subsequent crop years from $0.15 to 
$0.20 per hundredweight of dates handled. The Committee unanimously 
recommended 2020-21 crop year expenditures of $75,250 and an assessment 
rate of $0.20 per hundredweight of dates, which is $0.05 higher than 
the rate currently in effect. The quantity of assessable dates for the 
2020-21 crop year is estimated to be 32,000,000 pounds (320,000 
hundredweight). The proposed $0.20 rate should provide $64,000 in 
assessment income. Income derived from handlers' assessments, plus 
$5,000 of other income and $6,250 from the Committee's authorized 
reserve, should be adequate to cover the Committee's budgeted expenses 
for the 2020-21 crop year.
    The total budget recommended by the Committee for the 2020-21 crop 
year is $75,250, compared to $74,200 for the 2019-20 crop year. The 
Committee recommended the higher assessment rate to fully fund ongoing 
program expenses without depleting its operating reserve.
    The income generated from the proposed higher assessment rate, 
combined with other income and a small amount from the financial 
reserve, should be sufficient to cover anticipated 2020-21 expenses and 
to maintain a financial reserve within the limit specified by the 
Order.
    Section 987.72(d) states that the Committee may maintain an 
operating monetary reserve not to exceed the average of one year's 
expenses incurred during the most recent five preceding crop years, 
except that an established reserve need not be reduced to conform to 
any recomputed average. The Committee estimated that funds in its 
reserve would be approximately $35,000 at the beginning of the 2020-21 
crop year. It expects to utilize $6,250 of the reserve during the year, 
leaving a reserve of approximately $28,750 to start the 2021-22 crop 
year, which would be within the limit specified in the Order.
    The Committee reviewed and unanimously recommended 2020-21 crop 
year expenditures of $75,250. The Committee considered several factors 
before making its recommendation, including the size of the anticipated 
2020-21 crop, the Committee's estimated 2020-21 reserve carry-in,

[[Page 47601]]

other sources of income, and its anticipated expenses. Further, the 
Committee considered several alternative expenditure levels and 
assessment rates, including not changing the assessment rate or 
adjusting expenses. Ultimately, the Committee recommended the $0.20 per 
hundredweight assessment rate to fund the program's expenses and 
maintain its reserve at a reasonable level.
    A review of historical and preliminary information pertaining to 
the upcoming crop year indicates that the producer price for the 2020-
21 crop year is estimated to be $201.50 per hundredweight of dates. 
Utilizing that price, the estimated crop size, and the proposed 
assessment rate of $0.20 per hundredweight, the estimated assessment 
revenue for the 2020-21 crop year as a percentage of total producer 
revenue will be approximately 0.1 percent ($0.20 per hundredweight 
divided by $201.50 per hundredweight).
    This proposed action would increase the assessment obligation 
imposed on handlers. While assessments impose some additional costs on 
handlers, the costs are minimal and uniform on all handlers. Some 
additional costs may be passed on to producers. However, these costs 
would be offset by the benefits derived by the operation of the Order. 
In addition, the Committee's and the Subcommittee's meetings were 
widely publicized throughout the California date industry. All 
interested persons were invited to attend the meetings and encouraged 
to participate in Committee deliberations on all issues. The June 25, 
2020 Committee meeting was a virtually held public meeting and all 
entities, both large and small, were able to express views on this 
issue. 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 the Office of Management and Budget (OMB) and 
assigned OMB No. 0581-0178 Vegetable and Specialty Crops. No changes in 
these requirements would be necessary as a result of this action. 
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 California date 
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 proposed 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.

List of Subjects in 7 CFR Part 987

    Dates, Marketing agreements, Reporting and recordkeeping 
requirements.

    For reasons set forth in the preamble, 7 CFR part 987 is proposed 
to be amended as follows:

PART 987--DOMESTIC DATES PRODUCED OR PACKED IN RIVERSIDE COUNTY, 
CALIFORNIA

0
1. The authority citation for part 987 continues to read as follows:

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

0
2. Section 987.339 is revised to read as follows:


Sec.  987.339  Assessment rate.

    On and after October 1, 2020, an assessment rate of $0.20 per 
hundredweight is established for dates produced or packed in Riverside 
County, California.

Erin Morris,
Associate Administrator, Agricultural Marketing Service.
[FR Doc. 2021-17912 Filed 8-25-21; 8:45 am]
BILLING CODE 3410-02-P