[Federal Register: August 26, 2008 (Volume 73, Number 166)]
[
Rules and Regulations]               
[Page 50188-50191]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr26au08-3]                         

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DEPARTMENT OF AGRICULTURE



Agricultural Marketing Service



7 CFR Part 987



[Docket No. AMS-FV-08-0056; FV08-987-1 IFR]



 
Domestic Dates Produced or Packed in Riverside County, CA; 

Decreased Assessment Rate



AGENCY: Agricultural Marketing Service, USDA.



ACTION: Interim final rule with request for comments.



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[[Page 50189]]



SUMMARY: This rule decreases the assessment rate established for the 

California Date Administrative Committee (Committee) for the 2008-09 

and subsequent crop years from $0.75 to $0.60 per hundredweight of 

dates handled. The Committee locally administers the marketing order 

which regulates the handling of dates grown or packed in Riverside 

County, California. Assessments upon date handlers are used by the 

Committee to fund reasonable and necessary expenses of the program. The 

crop year begins October 1 and ends September 30. The assessment rate 

will remain in effect indefinitely unless modified, suspended, or 

terminated.



DATES: Effective August 27, 2008. Comments received by October 27, 

2008, will be considered prior to issuance of a final rule.



ADDRESSES: Interested persons are invited to submit written comments 

concerning this rule. Comments must be sent to the Docket Clerk, 

Marketing Order Administration Branch, Fruit and Vegetable Programs, 

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 docket 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.



FOR FURTHER INFORMATION CONTACT: Terry Vawter, Senior Marketing 

Specialist, or Kurt J. Kimmel, Regional Manager, California Marketing 

Field Office, Marketing Order Administration Branch, Fruit and 

Vegetable Programs, AMS, USDA; Telephone: (559) 487-5901, Fax: (559) 

487-5906, or E-mail: Terry.Vawter@usda.gov or Kurt.Kimmel@usda.gov.

    Small businesses may request information on complying with this 

regulation by contacting Jay Guerber, Marketing Order Administration 

Branch, Fruit and Vegetable Programs, AMS, USDA, 1400 Independence 

Avenue SW., STOP 0237, Washington, DC 20250-0237; Telephone: (202) 720-

2491, Fax: (202) 720-8938, or E-mail: Jay.Guerber@usda.gov.



SUPPLEMENTARY INFORMATION: This rule is issued under Marketing Order 

No. 987, as amended (7 CFR part 987), regulating the handling of dates 

grown or packed in Riverside County, California, hereinafter referred 

to as the ``order.'' 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 Department of Agriculture (USDA) is issuing this rule in 

conformance with Executive Order 12866.

    This rule has been reviewed under Executive Order 12988, Civil 

Justice Reform. Under the marketing 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 as issued herein will be applicable to all assessable dates 

beginning October 1, 2008, and continue until amended, suspended, or 

terminated. This rule will not preempt any State or local laws, 

regulations, or policies, unless they present an irreconcilable 

conflict with this rule.

    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 rule decreases the assessment rate established for the 

Committee for the 2008-09 and subsequent crop years from $0.75 per to 

$0.60 per hundredweight of dates.

    The California date marketing 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 

California dates. 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 2007-08 and subsequent crop years, the Committee 

recommended, and USDA approved, an assessment rate that would continue 

in effect from crop year to crop 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 May 29, 2008, and unanimously recommended 

2008-09 expenditures of $176,384 and an assessment rate of $0.60 per 

hundredweight of California dates. In comparison, last year's budgeted 

expenditures were $209,182. The assessment rate of $0.60 is $0.15 lower 

than the rate currently in effect. The Committee recommended a lower 

assessment rate because the 2007 crop was larger than expected, 

resulting in excess assessment income and thus a larger reserve. Income 

generated through the lower assessment rate combined with reserve funds 

should be sufficient to cover anticipated 2008-09 expenses.

    Section 987.72(c) states that the reserve may not exceed 50 percent 

of the average of expenses incurred during the most recent five 

preceding crop years. With the larger 2007 crop, the reserve at the end 

of the 2007-08 crop year is projected to exceed this limit. Excess 

assessment funds will be refunded to handlers to reduce the reserve and 

bring it in line with order requirements.

    Proceeds from sales of cull dates are deposited in a surplus 

account for subsequent use by the Committee in covering the surplus 

pool share of the Committee's expenses. Handlers may also dispose of 

cull dates of their own production within their own livestock-feeding 

operation; otherwise, such cull dates must be shipped or delivered to 

the Committee for sale to non-human food product outlets. Pursuant to 

Sec.  987.72(b), the Committee is authorized to temporarily use funds 

derived from assessments to defray expenses incurred in disposing of 

surplus dates. All such expenses are required to be deducted from 

proceeds obtained by the Committee from the disposal of surplus dates. 

For the 2008-09 crop year, the Committee estimated that $4,500 from the 

surplus account would be needed to temporarily defray expenses incurred 

in disposing of surplus dates.

    The major expenditures recommended by the Committee for the 2008-09 

crop year include $66,384 for general and administrative programs, 

$82,000 for promotional programs, and $28,000 for marketing and media 

consulting. The Committee also budgeted $10,000 as a contingency 

reserve for other marketing and promotion projects that it may wish to



[[Page 50190]]



support later in the year. By comparison, expenditures recommended by 

the Committee for the 2007-08 crop year include $87,312 for general and 

administrative programs, $67,870 for promotional programs, $24,000 for 

marketing and media consulting, $5,000 for moving expenses, and $5,000 

for updating marketing materials. The Committee budgeted $20,000 as a 

contingency reserve for other marketing and promotion projects.

    The assessment rate of $0.60 per hundredweight of assessable dates 

was derived by applying the following formula where:

    A= 2007-08 estimated reserve on 09/30/08 ($134,757);

    B= 2008-09 estimated reserve on 10/01/09 ($78,996);

    C= 2008-09 expenses ($176,384);

    D= Cull Surplus Fund ($4,500);

    E= Assessment Refund ($15,877); and

    F= 2008-09 expected shipments (22,000,000 pounds).

    [(B-A+C-D+E)/F] *100.

    The assessment rate established in this rule will 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 is effective for an indefinite 

period, the Committee will 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 USDA. 

Committee meetings are open to the public and interested persons may 

express their views at these meetings. USDA will evaluate Committee 

recommendations and other available information to determine whether 

modification of the assessment rate is needed. Further rulemaking will 

be undertaken as necessary. The Committee's 2008-09 budget and those 

for subsequent crop years will be reviewed and, as appropriate, 

approved by USDA.



Initial Regulatory Flexibility Analysis



    Pursuant to requirements set forth in the Regulatory Flexibility 

Act (RFA), the Agricultural Marketing Service (AMS) has considered the 

economic impact of this 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 

business 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 85 producers of dates in the production 

area and 9 handlers subject to regulation under the marketing order. 

The Small Business Administration (13 CFR 121.201) defines small 

agricultural producers as those having annual receipts of less than 

$750,000, and small agricultural service firms are defined as those 

having annual receipts of less than $6,500,000.

    According to the National Agricultural Statistics Service (NASS), 

data for the most recently completed crop year (2006) shows that about 

3.12 tons, or 6,240 pounds, of dates were produced per acre. The 2006 

grower price published by the NASS was $1,320 per ton, or $.66 per 

pound. Thus, the value of date production per acre in 2006 averaged 

about $4,118 (6,240 pounds times $.66 per pound). At that average 

price, a producer would have to farm over 182 acres to receive an 

annual income from dates of $750,000 ($750,000 divided by $4,118 per 

acre equals 182 acres). According to Committee staff, the majority of 

California date producers farm less than 182 acres. Thus, it can be 

concluded that the majority of date producers could be considered small 

entities. The majority of handlers of California dates may also be 

considered small entities.

    This rule decreases the assessment rate established for the 

Committee and collected from handlers for the 2008-09 and subsequent 

crop years from $0.75 to $0.60 per hundredweight of dates handled. The 

Committee unanimously recommended 2008-09 expenditures of $176,384 and 

an assessment rate of $0.60 per hundredweight of dates, which is $0.15 

lower than the 2007-08 rate, currently in effect. The quantity of 

assessable dates for the 2008-09 crop year is estimated at 22,000,000 

pounds. Thus, the $0.60 rate should provide $132,000 in assessment 

income and, with reserve funds of $39,884 and the $4,500 contribution 

from the surplus program, will be adequate to meet the 2008-09 crop 

year expenses.

    The major expenditures recommended by the Committee for the 2008-09 

crop year include $66,384 for general and administrative programs, 

$82,000 for promotional programs, and $28,000 for marketing and media 

consulting. The Committee also budgeted $10,000 as a contingency 

reserve for other marketing and promotion projects that it may wish to 

support later in the year.

    The Committee recommended a lower assessment rate because the 2007 

crop was larger than expected, resulting in excess assessment income 

and thus a larger reserve. Income generated through the lower 

assessment rate combined with reserve funds should be sufficient to 

cover anticipated 2008-09 expenses.

    The Committee reviewed and unanimously recommended 2008-09 crop 

year expenditures of $176,384. Prior to arriving at this budget, the 

Committee considered information from various sources, such as the 

Committee's Marketing Subcommittee. Alternative expenditure levels were 

an option available to the Committee, but given the extra assessment 

income generated from the larger-than-expected 2007-08 crop, it was 

ultimately determined that a $176,384 budget would be appropriate. The 

assessment rate of $0.60 per hundredweight of dates was then derived, 

based upon the Committee's estimates of the incoming reserve, income, 

and anticipated expenses.

    According to the NASS, the season average grower price for 2007 

crop dates is projected at $1,800 per ton, or $90 per hundredweight. No 

official NASS estimate is available yet for 2008. The average grower 

price for 2005-07 is $1,517 per ton, or $76 per hundredweight.

    To calculate the percentage of grower revenue represented by the 

assessment rate for 2007, the assessment rate of $0.75 (per 

hundredweight) is divided by the estimated average grower price. This 

results in estimated assessment revenue for the 2007-08 crop year as a 

percentage of grower revenue of .83 percent ($0.75 divided by $90 per 

hundredweight). As previously mentioned, NASS data for 2008 is not yet 

available. However, applying the same calculations above using the 

average grower price for 2005-07 would result in estimated assessment 

revenue as a percentage total grower revenue of .79 percent for the 

2008-09 crop year ($0.60 divided by $76 per hundredweight). Thus, the 

assessment revenue should be well below 1 percent of estimated grower 

revenue in 2008.

    This action decreases 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 reduces the burden on handlers, and may reduce the 

burden on producers. In addition, the Committee's meeting was widely 

publicized throughout the California date industry and all interested 

persons were invited to attend the meeting and



[[Page 50191]]



participate in Committee deliberations on all issues. Like all 

Committee meetings, the May 29, 2008, 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 interim final rule, including the regulatory and informational 

impacts of this action on small businesses.

    This action imposes no 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 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/ AMSv1.0/ ams.fetchTemplateData.do? 

template=TemplateN&page= MarketingOrdersSmallBusinessGuide. Any 

questions about the compliance guide should be sent to Jay Guerber 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, as 

hereinafter set forth, will tend to effectuate the declared policy of 

the Act.

    Pursuant to 5 U.S.C. 553, it is also found and determined upon good 

cause that it is impracticable, unnecessary, and contrary to the public 

interest to give preliminary notice prior to putting this rule into 

effect, and that good cause exists for not postponing the effective 

date of this rule until 30 days after publication in the Federal 

Register because: (1) The 2008-09 crop year begins on October 1, 2008, 

and the marketing order requires that the rate of assessment for each 

crop year applies to all assessable dates handled during such crop 

year; (2) the action decreases the assessment rate for assessable dates 

beginning with the 2008-09 crop year; (3) handlers are aware of this 

action which was unanimously recommended by the Committee at a public 

meeting and is similar to other assessment rate actions issued in past 

years; and (4) this interim final rule provides a 60-day comment 

period, and all comments timely received will be considered prior to 

finalization of this rule.



List of Subjects in 7 CFR Part 987



    Dates, Marketing agreements, Reporting and recordkeeping 

requirements.



0

For the reasons set forth in the preamble, 7 CFR part 987 is amended as 

follows:



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



0

1. The authority citation for 7 CFR 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, 2008, an assessment rate of $0.60 per 

hundredweight is established for California dates.



    Dated: August 20, 2008.

Lloyd C. Day,

Administrator, Agricultural Marketing Service.

[FR Doc. E8-19697 Filed 8-25-08; 8:45 am]

BILLING CODE 3410-02-P