[Federal Register Volume 88, Number 220 (Thursday, November 16, 2023)]
[Proposed Rules]
[Pages 78679-78681]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-25247]


 ========================================================================
 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.
 
 ========================================================================
 

  Federal Register / Vol. 88, No. 220 / Thursday, November 16, 2023 / 
Proposed Rules  

[[Page 78679]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 989

[Doc. No. AMS-SC-23-0038]


Raisins Produced From Grapes Grown in California; Increased 
Assessment Rate

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

ACTION: Proposed rule.

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

SUMMARY: The Agricultural Marketing Service (AMS) proposes to implement 
a recommendation from the Raisin Administrative Committee (Committee) 
to increase the assessment rate established for the 2023-2024 and 
subsequent crop years. The proposed assessment rate would remain in 
effect indefinitely unless modified, suspended, or terminated.

DATES: Comments must be received by December 18, 2023.

ADDRESSES: Interested persons are invited to submit written comments 
concerning this proposed rulemaking. Comments may be sent to the Docket 
Clerk, Market Development Division, Specialty Crops Program, AMS, USDA, 
1400 Independence Avenue SW, STOP 0237, Washington, DC 20250-0237. 
Comments can also be submitted to the Docket Clerk electronically by 
Email: [email protected] or via the internet at: https://www.regulations.gov. Comments should reference the document number, and 
date and page number of this issue of the Federal Register. Comments 
submitted in response to this proposed rulemaking will be included in 
the record, will be made available to the public, and can be viewed at: 
https://www.regulations.gov. 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: Kathie Notoro, Marketing Specialist, 
or Gary Olson, Chief, West Region Branch, Market Development Division, 
Specialty Crops Program, AMS, USDA; Telephone: (559) 487-5901 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) 720-8085, or Email: 
[email protected].

SUPPLEMENTARY INFORMATION: This action, pursuant to 5 U.S.C. 553, 
proposes to amend regulations issued to carry out a marketing order as 
defined in 7 CFR 900.2(j). This proposed rulemaking is issued under 
Marketing Agreement and Order No. 989, as amended (7 CFR part 989), 
regulating the handling of raisins produced from grapes grown in 
California. Part 989 (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 
raisins operating within the area of production, and a public member.
    AMS is issuing this proposed rulemaking in conformance with 
Executive Orders 12866, 13563, and 14094. Executive Orders 12866, 
13563, and 14094 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. Executive Order 14094 
directs agencies to conduct proactive outreach to engage interested and 
affected parties through a variety of means, such as through field 
offices, and alternative platforms and media. 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 rulemaking 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 
rulemaking 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 rulemaking has been reviewed under Executive Order 
12988, Civil Justice Reform. Under the order now in effect, California 
raisin handlers are subject to assessments. Funds to administer the 
order are derived from such assessments. It is intended that the 
proposed assessment rate would be applicable to all assessable raisins 
beginning on August 1, 2023, 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 the U.S. 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 not later than 20 
days after the date of the entry of the ruling.
    Section 989.79 provides authority for 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 are 
familiar with the Committee's needs and with the costs of 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

[[Page 78680]]

and discussed in a public meeting. Thus, all directly affected persons 
have an opportunity to participate and provide input.
    For the 2018-2019 and subsequent crop years, an assessment rate of 
$22 per assessable ton of raisins handled (84 FR 2049) was in place. 
That rate continues in effect from crop year to crop year until 
modified, suspended, or terminated by AMS upon recommendation and 
information submitted by the Committee or other information available 
to AMS.
    This proposed rulemaking would increase the assessment rate from 
$22 per ton to $24 per ton of assessable raisins for the 2023-2024 and 
subsequent crop years. Prior to arriving at this proposed assessment 
rate, the Committee considered information from its Audit Subcommittee 
(Subcommittee), which met on June 21, 2023. The Subcommittee discussed 
alternative spending levels before making a recommendation to the full 
Committee. On June 28, 2023, the full Committee discussed the 
recommendation of the Subcommittee and voted unanimously to recommend a 
budget of $5,241,000 and an assessment rate of $24 per ton as 
reasonable and necessary to properly administer the Order.
    The Committee last amended the assessment rate in 2019 to $22 per 
ton, which continues to remain in effect; however, California raisin 
acreage and volume have steadily declined since 2019. The Committee 
determined the level of assessment revenue under the current rate as 
now insufficient to meet the rising costs of program operations given a 
production estimate of 192,000 tons of assessable raisins for the 2023-
2024 crop year.
    The proposed assessment rate of $24 is $2 higher than the rate 
currently in effect and is expected to generate assessment income of 
approximately $4,608,000 ($24 per ton multiplied by 192,000 assessable 
tons) for the 2023-2024 crop year. This assessment revenue, combined 
with other Committee income and monetary reserves is sufficient to 
cover the balance of $633,000 ($5,241,000 minus $4,608,000).
    The major expenditures recommended by the Committee for the 2023-
2024 crop year include $3,303,000 for marketing promotion; $1,205,000 
for salaries and employee-related costs; $658,000 for administrative 
expenses; $55,000 for compliance activities; and $20,000 for research 
and studies. Budgeted expenditures for the 2022-2023 crop year were 
$3,592,000; $1,232,000; $703,900; $55,000; and $45,000, respectively. 
The proposed assessment rate increase would help cover the expenditures 
for the 2023-2024 crop year, while reducing the amount of money needing 
to be expended from reserves.
    This proposed assessment rate would 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 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. The 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 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 AMS.

Initial Regulatory Flexibility Analysis

    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA) (5 U.S.C. 601-612), the AMS has considered the economic 
impact of this proposed rulemaking 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 1,700 producers of California raisins and 
approximately 17 handlers subject to regulation under the marketing 
order. Small agricultural producers of raisins are defined by the Small 
Business Administration (SBA) as those having annual receipts equal to 
or less than $4.0 million (NAICS code 111332, Grape Vineyards) and 
small agricultural service firms are defined as those whose annual 
receipts are equal to or less than $34.0 million (NAICS code 115114, 
Postharvest Crop Activities) (13 CFR 121.201).
    Using USDA National Agricultural Statistics Service (NASS) data, 
the 2022 season average value of utilized production of California 
processed raisin-type grapes (most of which are dried into raisins) is 
$376.618 million. Dividing that figure by 1,700 producers yields an 
annual average revenue per producer of $221,540, well below the SBA 
large farm size threshold of $4.0 million. Therefore, in terms of 
average annual sales of processed raisin-type grapes, the majority of 
California raisin producers may be classified as small entities.
    To make a similar computation for handlers, the first step is to 
estimate a representative handler price received per pound for packaged 
raisins. Recent USDA purchases under the Commodity Procurement Program 
provide such an estimate. For the most recent raisin crop year used by 
the RAC (August 2022-July 2023) the average price paid for packaged 
raisins purchased by the USDA for feeding programs was $1.56 per pound. 
For that time period, the RAC provided a list of quantities delivered 
by handlers. When multiplied by the $1.56 price per pound, the results 
showed that 5 handlers had annual raisin receipts greater than $34 
million, the SBA threshold level for a large handler. The remaining 12 
handlers out of 17 are small handlers, using the SBA criterion.
    This proposed rulemaking would increase the assessment rate 
collected from handlers for the 2023-2024 and subsequent crop years 
from $22 to $24 per ton of assessable raisins acquired by handlers. The 
Committee reviewed its ongoing activities and determined the expenses 
that would be reasonable and necessary to continue program operations 
for the 2023-2024 crop year. Additionally, the Committee considered 
that California raisin acreage and volume have steadily declined. 
Consequently, the revenue collected from assessments also decreased, 
while program operating costs have continued to increase. Ultimately, 
the Committee recommended budget totals $5,241,000 for the 2023-2024 
crop year. With the current assessment of $22 a ton, and an operating 
budget of $5,241,000, the Committee would face a deficit of over $1MM. 
At the recommended assessment rate of $24 per ton, the anticipated 
assessment income would be $4,608,000 and would help reduce the 
estimated deficit by approximately $384,000.
    The major expenditures recommended by the Committee for the 2023-
2024 crop year include $3,303,000 for marketing promotion; $1,205,000 
for salaries and employee-related costs; $658,000 for administrative 
expenses;

[[Page 78681]]

$55,000 for compliance activities; and $20,000 for research and 
studies. Budgeted expenditures for the 2022-2023 crop year were 
$3,592,000; $1,232,000; $703,900; $55,000; and $45,000, respectively. 
The increased assessment rate is necessary to help cover the 
expenditures for the 2023-2024 crop year, while reducing the amount of 
money needing to be expended from reserves.
    The Order provides authority for the Committee to formulate an 
annual budget of expenses and propose an assessment rate to cover such 
expenses authorized by AMS. Prior to arriving at this budget and 
assessment rate, the Committee considered alternative spending levels 
at its June 28, 2023, meeting but ultimately decided that the 
recommended budget and assessment rate were reasonable and necessary to 
properly administer the Order.
    This proposed rulemaking would increase the assessment obligation 
imposed on handlers. While the increased assessment rate would impose 
some additional costs on handlers, the costs are minimal and applied 
uniformly on all handlers. Some of the additional costs may be passed 
on to producers. However, these costs would be offset by the benefits 
derived by the industry from the operation of the Order.
    The Committee's meetings are widely publicized throughout the 
production area. The raisin industry and all interested persons are 
invited to attend the meetings and participate in Committee 
deliberations on all issues. Like all Committee meetings, the June 28, 
2023, meeting was public meeting and all entities, both large and 
small, were able to express views on this issue. In addition, 
interested persons are invited to submit comments on this proposed 
rulemaking, 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. 0581-0178, Vegetable 
and Specialty Crops. 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 rulemaking would not impose any additional reporting 
or recordkeeping requirements on either small or large California 
raisin 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.
    AMS has not identified any relevant Federal rules that duplicate, 
overlap, or conflict with this proposed rulemaking.
    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 recommendations submitted by the Committee and 
other available information, USDA has determined that this proposed 
rulemaking is consistent with and will effectuate the purposes of the 
Act.
    A 30-day comment period is provided to allow interested persons to 
respond to this proposed rulemaking. All written comments timely 
received will be considered before a final determination is made on 
this proposed rule.

List of Subjects in 7 CFR Part 989

    Grapes, Marketing agreements, Raisins, Reporting and recordkeeping 
requirements.

    For the reasons set forth in the preamble, the Agricultural 
Marketing Service proposes to amend 7 CFR part 989 as follows:

PART 989--RAISINS PRODUCED FROM GRAPES GROWN IN CALIFORNIA

0
1. The authority citation for 7 CFR part 989 continues to read as 
follows:

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

0
2. Section 989.347 is revised to read as follows:


Sec.  989.347  Assessment rate.

    On and after August 1, 2023, an assessment rate of $24 per ton is 
established for assessable raisins produced from grapes in California.

Erin Morris,
Associate Administrator, Agricultural Marketing Service.
[FR Doc. 2023-25247 Filed 11-15-23; 8:45 am]
BILLING CODE P