[Federal Register Volume 87, Number 165 (Friday, August 26, 2022)]
[Rules and Regulations]
[Pages 52431-52433]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-18455]



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 Rules and Regulations
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  Federal Register / Vol. 87, No. 165 / Friday, August 26, 2022 / Rules 
and Regulations  

[[Page 52431]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 915

[Doc. No. AMS-SC-22-0004; SC22-915-1 FR]


Avocados Grown in South Florida; Increased Assessment Rate

AGENCY: Agricultural Marketing Service, Department of Agriculture 
(USDA).

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: This rule implements a recommendation from the Avocado 
Administrative Committee to increase the assessment rate established 
for the 2022-23 and subsequent fiscal years. The assessment rate will 
remain in effect indefinitely unless modified, suspended, or 
terminated.

DATES: Effective September 26, 2022.

FOR FURTHER INFORMATION CONTACT: Delaney Fuhrmeister, Marketing 
Specialist, or Christian D. Nissen, Chief, Southeast Region Branch, 
Market Development 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, Market Development 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, 
amends regulations issued to carry out a marketing order as defined in 
7 CFR 900.2(j). This 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 Agricultural Marketing Service (AMS) is issuing this 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 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 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 rule has been reviewed under Executive Order 12988, Civil 
Justice Reform. Under the 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 will be 
applicable to all assessable Florida avocados for the 2022-23 fiscal 
year, and continue until amended, suspended, or terminated.
    The Act provides that the 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 
the United States Department of Agriculture (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 no later than 20 days after the date of 
entry of the ruling.
    This rule increases the assessment rate established for the 2022-23 
and subsequent fiscal years from $0.45 to $0.50 per 55-pound container 
or equivalent of avocados.
    The Order authorizes the Committee, with the approval of AMS, to 
formulate an annual budget of expenses and collect assessments from 
handlers to administer the program. The members of the Committee are 
familiar with the Committee's needs and with the 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 2021-22 and subsequent fiscal years, the Committee 
recommended, and AMS approved, an assessment rate that would continue 
in effect from fiscal year to fiscal year unless modified, suspended, 
or terminated by AMS upon recommendation and information submitted by 
the Committee or other information available to AMS.
    The Committee met on January 12, 2022, and recommended 2022-23 
expenditures of $268,484 and an assessment rate of $0.50 per 55-pound 
container or equivalent of avocados. In comparison, last year's 
budgeted expenditures were $348,484. The assessment rate of $0.50 is 
$0.05 higher than the rate currently in effect. The Committee discussed 
the need to increase the assessment rate based on the 2022-23 crop 
estimate of 500,000 55-pound containers, a decrease from 800,000 from 
the previous year. At the current assessment rate, assessment income 
would equal only $225,000, an

[[Page 52432]]

amount insufficient to cover the Committee's anticipated expenditures 
of $268,484. By increasing the assessment rate by $0.05, assessment 
income will be $250,000, which will reduce the amount of funds needed 
from the Committee's authorized reserve to cover the 2022-23 budgeted 
expenses. This amount, along with interest income, and funds from the 
reserve, should provide sufficient funds to meet 2022-23 anticipated 
expenses.
    Major expenditures recommended by the Committee for the 2022-23 
year include $116,164 for salaries, $53,350 for employee benefits, and 
$26,500 for office rent and supplies. Budgeted expenses for these items 
in 2021-22 were $116,164, $53,350, and $26,500 respectively.
    The assessment rate recommended by the Committee was derived by 
reviewing anticipated expenses, expected shipments of Florida avocados, 
and the level of funds in reserve. Avocado shipments for the year are 
estimated at 500,000 55-pound containers, which should provide $250,000 
in assessment income (500,000 containers x $0.50). Income derived from 
handler assessments at the increased rate, along with interest income, 
and funds from the Committee's authorized reserve, should be adequate 
to cover budgeted expenses. Funds in the reserve (currently about 
$230,000) are expected to be kept within the maximum permitted by the 
Order (approximately three fiscal years' expenses as authorized in 
Sec.  915.42).
    The assessment rate will continue in effect indefinitely unless 
modified, suspended, or terminated by AMS upon 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 
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 AMS. 
Committee meetings are open to the public and interested persons may 
express their views at these meetings. AMS 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 2022-23 budget and those 
for subsequent fiscal years will be reviewed and, as appropriate, 
approved by AMS.

Final Regulatory Flexibility Analysis

    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA) (5 U.S.C. 601-612), 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 315 growers of Florida avocados in the production area 
and 24 handlers subject to regulation under the Order. Small 
agricultural avocado growers are defined by the Small Business 
Administration (SBA) as those having annual receipts less than 
$3,000,000, and small agricultural service firms are defined as those 
whose annual receipts are less than $30,000,000 (13 CFR 121.201). The 
SBA threshold for growers changed in between the proposed and the final 
rule. Thus, AMS changed the RFA to reflect the new amount in this final 
rule. The change did not impact the number of growers considered to be 
small.
    According to the National Agricultural Statistics Service, the 
average grower price paid for Florida avocados during the 2020-21 
season was $21.97 per 55-pound container. Utilized production was 
equivalent to 624,364 55-pound containers for a total value of over 
$13,717,277 ($21.97 multiplied by 624,364 55-pound containers). 
Dividing the crop value by the estimated number of growers yields an 
estimated average receipt per grower of $43,547 ($13,717,277 divided by 
315), so the majority of growers would have annual receipts of less 
than $3,000,000.
    AMS Market News reported that April 2021 terminal market prices for 
green skinned avocados were about $83.60 per 55-pound container. Using 
this price and the total utilization, the total 2020-21 handler crop 
value is estimated at $52.2 million ($83.60 multiplied by 624,364 55-
pound containers). Dividing this figure by the number of handlers 
yields an estimated average annual handler receipt of $2.18 million 
($52.2 million divided by 24), which is below the SBA threshold for 
small agricultural service firms. Thus, the majority of Florida avocado 
growers and handlers may be classified as small entities.
    This rule increases the assessment rate collected from handlers for 
the 2022-23 and subsequent fiscal years from $0.45 to $0.50 per 55-
pound container or equivalent of avocados. The Committee recommended 
2022-23 expenditures of $268,484 and an assessment rate of $0.50 per 
55-pound container or equivalent of avocados. The assessment rate of 
$0.50 is $0.05 higher than the previous rate. The quantity of 
assessable avocados for the 2022-23 season is estimated at 500,000 55-
pound containers. Thus, the $0.50 rate should provide $250,000 in 
assessment income. Income derived from handler assessments, along with 
interest income, and funds from the Committee's authorized reserve, 
should be adequate to cover budgeted expenses.
    Major expenditures recommended by the Committee for the 2022-23 
fiscal year include $116,164 for salaries, $53,350 for employee 
benefits, and $26,500 for office rent and supplies. Budgeted expenses 
for these items in 2021-22 were $116,164, $53,350, and $26,500, 
respectively.
    The Committee recommended increasing the assessment based on the 
2022-23 crop estimate of 500,000 55-pound containers, which is a 
decrease from the 800,000 55-pound containers estimated for the 
previous year. At the current assessment rate, assessment income would 
equal $225,000, an amount insufficient to cover the Committee's 
anticipated expenditures of $268,484. By increasing the assessment rate 
by $0.05, assessment income would be $250,000, which would reduce the 
amount of funds needed from the reserve. This amount, along with 
interest income, and funds from the reserve, should provide sufficient 
funds to meet 2022-23 anticipated expenses.
    Prior to arriving at this budget and assessment rate, the Committee 
considered maintaining the current assessment rate of $0.45. The 
Committee ultimately determined that leaving the assessment rate 
unchanged would not generate sufficient revenue to meet the Committee's 
2022-23 expenditures of $268,484. Therefore, the Committee rejected the 
idea of maintaining the current assessment rate.
    A review of historical information and preliminary information 
pertaining to the upcoming fiscal year indicates that the grower price 
for the 2022-23 fiscal year should be around $22.50 per 55-pound 
container or equivalent of avocados. The increased assessment rate of 
$0.50 per 55-pound container or equivalent of avocados represents 2.2 
percent of the $22.50 estimated average grower price ($0.50 divided by 
$22.50 x 100).

[[Page 52433]]

    This action increases the assessment obligation imposed on 
handlers. While assessments impose additional costs on handlers, the 
costs are minimal and uniform on all handlers, and some of the costs 
may be passed on to growers. However, these costs are expected to be 
offset by the benefits derived by the operation of the Order.
    The Committee meetings are widely publicized throughout the Florida 
avocado industry and all interested persons are invited to attend 
meetings and participate in Committee deliberations on all issues. Like 
all Committee meetings, the January 12, 2022, meeting was a public 
meeting and all entities, both large 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 OMB and assigned OMB No. 0581-0189 Fruit Crops. 
No changes in those requirements are necessary as a result of this 
rule. 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 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. As noted in the 
initial regulatory flexibility analysis, AMS has not identified any 
relevant Federal rules that duplicate, overlap, or conflict with this 
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 April 22, 2022 (87 FR 24070). Copies of the proposed rule 
were also mailed or sent via email to all south Florida avocado 
handlers. The proposal was made available through the internet by USDA 
and https://www.regulations.gov. A 30-day comment period ending May 23, 
2022, was provided for interested persons to respond to the proposal. 
No comments were received. Accordingly, no changes will be made to the 
rule as proposed.
    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.
    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 will tend to 
effectuate the declared policy of the Act.

List of Subjects in 7 CFR Part 915

    Avocados, Marketing agreements, Reporting and recordkeeping 
requirements.

    For the reasons set forth in the preamble, the Agricultural 
Marketing Service amends 7 CFR part 915 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, 2022, an assessment rate of $0.50 per 55-
pound container or equivalent is established for avocados grown in 
South Florida.

Erin Morris,
Associate Administrator, Agricultural Marketing Service.
[FR Doc. 2022-18455 Filed 8-25-22; 8:45 am]
BILLING CODE P