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.

Proposed Rules Federal Register

59551

Vol. 69, No. 192

Tuesday, October 5, 2004

DEPARTMENT OF AGRICULTURE 

Agricultural Marketing Service 

7 CFR Part 923 

[Docket Nos. AO–F&V–923–3; FV03–923–01] 

Sweet Cherries Grown in Designated 

Counties in Washington; 

Recommended Decision and 

Opportunity To File Written Exceptions 

to Proposed Amendments to Marketing 

Agreement and Order No. 923

AGENCY: Agricultural Marketing Service, 

USDA.

ACTION: Proposed rule and opportunity 

to file exceptions. 

SUMMARY: This recommended decision 

invites written exceptions on proposed 

amendments to the marketing agreement 

and order (order) for sweet cherries 

grown in Washington. Four 

amendments were proposed by the 

Washington Cherry Marketing 

Committee (Committee), which is 

responsible for local administration of 

the order: adding authority for 

promotion, including paid advertising, 

and production research projects; 

adding authority for supplemental rates 

of assessment for individual varieties of 

cherries; adding authority for the 

Committee to accept voluntary 

contributions for research and 

promotion; and, adding a public 

member to the Committee. Two 

additional amendments are proposed by 

the Agricultural Marketing Service: 

establishing tenure limitations for 

Committee members; and, requiring that 

continuance referenda be conducted 

every 6 years.

DATES: Written exceptions must be filed 

by November 4, 2004.

ADDRESSES: Written exceptions should 

be filed with the Hearing Clerk, U.S. 

Department of Agriculture, room 1081–

S, Washington, DC 20250–9200, 

Facsimile number (202) 720–9776 or 

http://www.regulations.gov. All 

comments should reference the docket 

number and the date and page number 

of this issue of the Federal Register. 

Comments will be made available for 

public inspection in the Office of the 

Hearing Clerk during regular business 

hours, or can be viewed at: http://

www.ams.usda.gov/fv/moab.html.

FOR FURTHER INFORMATION CONTACT:

Melissa Schmaedick, Marketing Order 

Administration Branch, Fruit and 

Vegetable Programs, Agricultural 

Marketing Service, USDA, Post Office 

Box 1035, Moab, UT 84532, telephone: 

(435) 259–7988, fax: (435) 259–4945. 

Small businesses may request 

information on this proceeding 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.

SUPPLEMENTARY INFORMATION: Prior 

documents in this proceeding include a 

Notice of Hearing issued on October 6, 

2003, and published in the October 10, 

2003, issue of the Federal Register (68 

FR 58636). 

This action is governed by the 

provisions of sections 556 and 557 of 

title 5 of the United States Code and is 

therefore excluded from the 

requirements of Executive Order 12866. 

Preliminary Statement 

Notice is hereby given of the filing 

with the Hearing Clerk of this 

recommended decision with respect to 

the proposed amendment of Marketing 

Agreement and Order No. 923 regulating 

the handling of sweet cherries grown in 

designated counties in Washington, and 

the opportunity to file written 

exceptions thereto. Copies of this 

decision can be obtained from Melissa 

Schmaedick, whose address is listed 

above. 

This recommended decision is issued 

pursuant to the provisions of the 

Agricultural Marketing Agreement Act 

of 1937, as amended (7 U.S.C. 601 et 

seq.), hereinafter referred to as the 

‘‘Act,’’ and the applicable rules of 

practice and procedure governing the 

formulation of marketing agreements 

and orders (7 CFR part 900). 

The proposed amendments are based 

on the record of a public hearing held 

November 18, 2003, in Yakima, 

Washington. Notice of this hearing was 

published in the Federal Register on 

October 10, 2003. The notice of hearing 

contained proposals submitted by the 

Committee and by AMS. 

The Committee’s proposed 

amendments include: (1) Adding the 

authority for promotion, including paid 

advertising, and production research 

projects; (2) adding the authority for 

supplemental rates of assessment for 

individual varieties of cherries; (3) 

adding the authority for the Committee 

to accept voluntary contributions for 

marketing research and promotion, 

including paid advertising, and 

production research projects; and (4) 

adding a public member and alternate 

public member to the Committee. 

The Fruit and Vegetable Programs of 

AMS proposed two additional 

amendments: to establish tenure 

limitations for Committee members and 

require that continuance referenda be 

conducted on a periodic basis to 

ascertain grower support for the order. 

In addition, AMS proposed to allow 

such changes as may be necessary to the 

order, if any of the proposed changes are 

adopted, so that all of the order’s 

provisions conform to the effectuated 

amendments.

Six industry witnesses testified at the 

hearing. These witnesses represented 

sweet cherry growers and handlers in 

the production area, and they all 

supported the Committee’s 

recommended changes. 

Witnesses addressed the need for 

adding the authority for promotion, 

including paid advertising, and 

production research projects. This 

authority would enable the Committee 

to develop more efficient growing, 

harvesting, marketing and distribution 

techniques for sweet cherries produced 

in the production area. Promotional 

activities, including paid advertising, 

could lead to greater market exposure 

and consumer demand for sweet 

cherries, thereby supporting increased 

grower returns. 

Witnesses stated their approval of the 

Committee’s recommendation to add the 

authority for supplemental rates of 

assessment for individual varieties of 

cherries. Funds generated from 

supplemental rates of assessment would 

be used for research or promotion 

projects specific to an individual variety 

of sweet cherry. 

Witnesses also supported the proposal 

to add authority for the Committee to 

accept voluntary contributions for 

marketing research and promotion, 

59552 Federal Register / Vol. 69, No. 192 / Tuesday, October 5, 2004 / Proposed Rules 

including paid advertising, and 

production research projects. Witnesses 

stated that the industry would benefit 

from this authority as contributions 

could provide the industry with 

additional research and marketing 

opportunities. 

Lastly, the Committee recommended 

adding a public member and alternate 

public member to the Committee. 

Witnesses stated that a public member 

would benefit Committee deliberations 

by bringing a non-industry, consumer 

perspective to the table. 

An AMS witness testified in support 

of tenure limitations as a way to 

broaden industry participation in the 

program. That witness also supported 

continuance referenda as a means of 

determining grower sentiment on the 

order’s operations. 

At the conclusion of the hearing, the 

Administrative Law Judge stated that 

the final date for interested persons to 

file proposed findings and conclusions 

or written arguments and briefs based 

on the evidence received at the hearing 

would be 30 days after USDA’s receipt 

of the hearing record transcript. No 

briefs were filed. 

Material Issues 

The material issues presented on the 

record of hearing are as follows: 

(1) Whether to add authority for 

promotion, including paid advertising, 

and production research projects; 

(2) Whether to add authority for 

supplemental rates of assessment for 

individual varieties of cherries; 

(3) Whether to add authority for the 

Committee to accept voluntary 

contributions for marketing research 

and promotion, including paid 

advertising, and production research 

projects; 

(4) Whether to add a public member 

and alternate public member seat to the 

Committee; 

(5) Whether to impose term 

limitations on Committee members; and 

(6) Whether to add a requirement that 

continuance referenda be held every 6 

years. 

Findings and Conclusions 

The following findings and 

conclusions on the material issues are 

based on evidence presented at the 

hearing and the record thereof. 

Material Issue Number 1—Authority 

for Production Research and 

Promotion, Including Paid Advertising 

Section 923.45 of the order should be 

amended to add authority for 

production research and promotion, 

including paid advertising. That order 

provision currently authorizes only 

marketing research and development 

activities.

This authority would enable the 

Committee to develop more efficient 

growing, harvesting, marketing and 

distribution techniques for sweet 

cherries produced in the production 

area. Promotional activities, including 

paid advertising, could lead to greater 

market exposure and consumer demand 

for Washington sweet cherries, thereby 

supporting increased returns for 

growers. 

This authority would enable the 

Committee to fund production research 

and promotion efforts. Such activities 

could be conducted by the Committee 

itself or be contracted out to other 

parties. The industry believes that it is 

important to include promotion and 

production research under the Federal 

marketing order as these activities are 

vital to the long-term health of the 

industry. 

The record evidence shows that sweet 

cherry acreage in Washington has 

increased from 21,000 acres in 1997 to 

an estimated 30,000 acres in 2004. In 

that same time period, overall tonnage 

of Washington sweet cherries increased 

from 62,000 tons to 120,000 tons. 

Witnesses testified that acreage and 

production will continue to increase, 

making promotion and research all that 

more important. As production 

increases, there is an increasing need to 

identify means of increasing quality and 

more accurately determining the volume 

of cherries that will be available to 

consumers in a given year. 

For many years, production research 

and promotion has been carried out by 

the Washington State Fruit Commission 

(Commission) and other entities within 

the industry. Demonstrated success of 

these research and promotion programs 

has led to industry support for adding 

this authority to the order. 

Testimony indicated that current 

industry production research and 

promotion activities range from the 

development of more accurate weather 

detection systems and timely 

distribution strategies, to in-store 

promotion activities and paid 

advertising. 

According to the record, production 

research in forecasting crop yield and 

harvest timing through Global 

Positioning Systems (GPS), satellite 

imagery, and real-time reporting 

technology has been particularly 

successful. Sweet cherries are a highly 

perishable crop. Accurate prediction of 

crop size and harvest timing is vital to 

the effective marketing and distribution 

of high quality cherries to the retail 

sectors. Because of the new advances in 

production technology, the industry was 

able to effectively anticipate the timing 

and record-breaking volume of the 2003 

sweet cherry crop. In 2003, 8.5 million 

boxes were harvested, marketed and 

sold over a four week period (June 15 

to July 15). Before that year, the 

industry’s record volume for those four 

weeks was 5.5 million boxes. 

Another example of research 

conducted by the industry involves taste 

testing of newly developed sweet cherry 

varieties. According to the record, new 

varieties developed in Prosser, 

Washington, were taken to the United 

Kingdom for consumer taste tests in 

2000. This project was a cooperative 

effort by the Commission, Washington 

State University and the Washington 

State Research Commission. This 

project helped the industry determine 

consumer receptivity of new varieties 

introduced into the market. 

A representative of the Commission 

testifying at the hearing stated that, 

since 1997, both volume and prices of 

Washington sweet cherries have shown 

annual increases. Increased market 

demand can be tied to the Commission’s 

success in working with the retail 

sector. From 1997 to 2003, the number 

of retailers running 4-week promotion 

ads increased from 30 to 79. At the same 

time, the number of retail chains 

decreased from 250 to 160. The witness 

stated that these numbers indicate that 

the relative proportion of retail exposure 

for sweet cherries since 1997 has 

increased considerably.

Consumers have responded to 

marketing efforts by doubling their 

purchase volume during targeted retail 

promotion periods. According to the 

witness, since 1997, sweet cherries have 

become a focus item for retail, as they 

have grown to make up at least 3.5 

percent of the total produce category 

sales. Sweet cherry sales also continue 

to drive just over 10 percent sales lifts 

in the U.S. domestic retail market in the 

months of June and July. 

The witness estimates that the dollar 

impact on the local economy, or the 

residual benefit of the Commission’s 

marketing efforts and increased sweet 

cherry demand within the State of 

Washington, has increased 29.74 

percent over the past 5 years. With 

nearly 70 percent of total sweet cherry 

production sold domestically, the 

industry’s marketing efforts have 

enabled the Washington sweet cherry 

industry to remain profitable in light of 

increasing production, rather than fall 

into a non-sustaining oversupply 

situation with low producer returns. 

One witness who produces other 

crops in addition to sweet cherries 

indicated that the recent loss of the 

Washington State Apple Commission 

Federal Register / Vol. 69, No. 192 / Tuesday, October 5, 2004 / Proposed Rules 59553

has had a negative impact on his returns 

for apples. More specifically, the 

witness indicated that the lack of 

promotional activities for Washington 

apples resulted in that industry’s 

inability to respond effectively to last 

year’s increased production. With 

increased volume in the market and few 

tools to assist in marketing and 

distributing that product, grower returns 

fell below subsistence levels. The 

witness stated that the Washington 

sweet cherry industry’s ability to 

continue to meet the industry’s 

challenges of increasing production 

through research and promotion has 

resulted in that industry’s continued 

success. While to date that work has 

been done under the auspices of the 

Commission, the industry wants to 

further its ability to conduct these 

activities by adding research and 

promotion authority to the order. 

When asked whether a voluntary 

promotion program would work for the 

Washington sweet cherry industry, 

witnesses responded that the authority 

to conduct research and promotion 

activities under the order would ensure 

that those activities continue in a 

consistent manner, and that they would 

not be subject to economic cycles within 

the industry. One witness explained 

that a cooperative approach to funding 

these activities would operate as an 

‘‘umbrella’’ mechanism for the entire 

industry by providing research and 

promotion solutions to all industry 

participants. Witnesses also indicated 

that this authority would be equally 

beneficial to small and large grower and 

handler entities. Grower input into the 

development of any research or 

promotion programs would also ensure 

that these activities, and the use of 

assessment funds to support them, 

would remain responsive to industry 

needs. 

Adding this authority to the order 

would provide the Committee with the 

flexibility to use research and 

promotional activities, including paid 

advertising, to assist and improve 

production techniques, and promote the 

marketing, distribution and 

consumption of Washington sweet 

cherries. The use of assessments and 

available funding sources for research 

and promotion, including paid 

advertising, would be an important 

component to increasing demand and 

consumption of Washington sweet 

cherries. 

The record supports adding authority 

for production research and promotion 

to § 923.45 of the order. There was no 

opposition testimony on this issue. 

Material Issue Number 2—

Supplemental Rates of Assessment 

Section 923.41, Assessments, of the 

order should be amended to allow 

additional rates of assessment for 

individual varieties of cherries. 

Currently, the order provides for a 

single rate of assessment for all cherries, 

regardless of variety, to be established. 

The base assessment rate is 

recommended by the Committee for 

approval by the Department. If authority 

to establish supplemental rates of 

assessment by variety was added to the 

order, those rates would also be 

recommended by the Committee for 

approval by USDA. Assessments are 

used to fund the administrative 

functions of the Committee, as well as 

any research and promotion activities. 

According to the record, supplemental 

rates of assessment would be used for 

expenses specific to an individual 

variety of sweet cherry. 

Witnesses stated that there are a 

number of reasons for which specific 

varieties may warrant supplemental 

assessment rates, including differences 

in production and marketing needs. 

Supplemental assessments could be 

used to fund research that is particular 

to the needs of a specific variety, or 

could be used to fund promotional 

projects to market lesser known or offseason varieties. Supplemental rates 

could also be applied when a particular 

variety of cherries produces a larger 

than anticipated crop in a given year. In 

those cases, extra funds generated 

through a supplemental rate could be 

used to support additional marketing 

efforts needed to stimulate demand and 

move that crop within the market. 

Witnesses stated that any 

supplemental assessments collected by 

variety of cherry should only be used to 

fund projects associated with that 

variety. While all growers within the 

production area benefit from general 

sweet cherry production research and 

marketing efforts, growers of specific 

varieties should fund any projects 

aimed at benefiting that particular 

variety. For example, if a new variety of 

sweet cherry is developed, special 

marketing may be needed to introduce 

that variety to consumers in the market. 

While there is a risk associated with the 

production of that new variety, both the 

costs and the benefits of producing a 

unique and potentially higher price 

product should be attributed to the 

growers of that product.

It is not anticipated that this authority 

would unduly burden small growers or 

handlers. While a supplemental 

assessment would represent an 

additional cost, witnesses stated that the 

benefits derived from that assessment 

would outweigh its cost. Adding this 

authority in conjunction with the 

proposal to add authority to conduct 

production research and promotion 

activities, including paid advertising, 

would allow the Committee to 

streamline and more specifically focus 

its research and promotion activities to 

the needs of the industry. 

Record evidence supports amending 

the marketing order to authorize 

supplemental rates of assessment for 

specific varieties of sweet cherries. This 

proposal would allow the Committee to 

collect assessment funds to be used for 

research and promotion activities that 

are specific to a single variety of sweet 

cherry in addition to projects that are 

beneficial to the Washington sweet 

cherry industry as a whole. There was 

no opposition expressed with respect to 

this proposal. 

Material Issue Number 3—Voluntary 

Contributions 

A new § 923.43, Contributions, should 

be added to the order to allow the 

Washington Cherry Marketing 

Committee to accept voluntary 

contributions for the purpose of funding 

marketing research and promotion 

(including paid advertising), and 

production research projects. Such 

contributions should be free from any 

encumbrances by the donor so that the 

Committee would retain complete 

control of their use. 

Currently, the marketing order 

program does not contain authority for 

the Committee to accept contributions. 

All marketing order activities are 

funded through handler assessments. 

Witnesses stated that the industry 

would benefit from this authority as 

contributions from groups and 

businesses could provide the industry 

with additional research and marketing 

opportunities. 

The record shows that contributions 

could come from equipment and 

machinery dealers, fertilizer, chemical 

or seed dealers, container manufacturers 

and dealers, and companies that 

currently have their own marketing 

activities. One witness stated that this 

authority would have healthy, longrange effects on the industry. 

Ultimately, this would benefit all 

growers, handlers and consumers of 

Washington sweet cherries. 

Witnesses testified that voluntary 

contributions should only be accepted 

with the understanding that the 

Committee would retain full discretion 

over how those funds would be used. 

Witnesses stated that project selection 

and spending decisions would rest with 

the Committee. While a donor could 

59554 Federal Register / Vol. 69, No. 192 / Tuesday, October 5, 2004 / Proposed Rules 

indicate a specific project that he or she 

supports, the Committee would decide 

how those funds should be spent. 

Record evidence supports revising the 

marketing order to incorporate the 

authority to accept voluntary 

contributions. There was no opposition 

given to this proposal. 

Material Issue Number 4—Public 

Member 

The marketing order should be 

revised to add a public member and 

alternate public member to the 

Washington Cherry Marketing 

Committee. This amendment would 

necessitate revising language in 

§ 923.20, Establishment and 

membership, and 923.22, Nomination.

If this change were implemented, 

Committee membership would increase 

from 16 to 17 members. The public 

member could not have any financial 

interest in the Washington sweet cherry 

industry. The public member would 

have the same rights and 

responsibilities as other Committee 

members, including reimbursement for 

expenses as approved by the Committee. 

Witnesses stated that the addition of 

a public member to the Committee 

would be beneficial in that it would 

bring a non-industry perspective to 

Committee deliberations and decisionmaking. The public member and 

alternate should be persons who can 

present constructive criticism when 

needed, and who can work together 

with other Committee members to build 

a bridge for better understanding 

between consumers and agriculture. 

The evidence of record is that a nonindustry perspective could be especially 

useful in deliberations over production 

research and promotion activities. 

Research and promotion activities are 

aimed not only at improving production 

and harvest techniques, but also product 

quality. High quality is important to the 

industry’s ability to boost consumer 

demand and maintain adequate grower 

returns. Moreover, promotion activities 

are intended to attract or increase 

consumer interest in the product. Often 

promotion activities include an 

educational element about the benefits 

of the product, or ideas for using the 

product in cooking or food presentation. 

A public member could help the 

Committee to decide which types of 

production research or promotion 

activities would be most beneficial in 

the eyes of the consumer. 

Persons serving as public 

representatives should not be, at the 

time of selection, nomination or during 

the term of office, engaged in the 

commercial production, buying, 

grading, processing of any agricultural 

product, nor should they be an officer, 

director, member, or employee of any 

firm engaged in the production or 

processing of any agricultural product. 

Should the public member or alternate 

public member become involved in 

such activities at any time during their 

term of office, they would become 

ineligible to continue to serve and a 

replacement would be nominated for 

the Department’s appointment. 

Testimony indicates that the initial 

public member and alternate public 

member should be nominated at the first 

Committee meeting following the 

selection of industry members for a new 

term of office, which starts on April 1. 

Normally, the Committee holds its 

marketing policy and organization 

meeting during May of each year, so 

such meeting could be used to nominate 

the public member and the alternate. 

Witnesses recognized that some delay 

would occur in the nomination and 

seating of the initial public member and 

alternate public member, as 

recommendation of those candidates 

would occur after the grower and 

handler members the Committee were 

appointed. Witnesses stated that it 

would be better to have the public 

member positions vacant for a short 

period of time until the new Committee 

members are seated by the Department, 

rather than create a second later term of 

office just applicable to the public 

member and alternate member. This 

situation would only occur once since 

all subsequent public members and 

their alternates would serve until their 

respective successors are appointed, as 

is currently practiced for all Committee 

grower and handler members. 

Record evidence supports the 

addition of a public member and 

alternate public member to the 

Washington Cherry Marketing 

Committee. No opposition to this 

proposal was presented at the hearing. 

Material Issue Number 5—Tenure 

Limitations 

Section 923.21, Term of office, should 

be revised to establish a limit on the 

number of consecutive terms a person 

may serve on the Committee. Currently, 

the term of office of each member and 

alternate member of the Committee is 

three years. There are no provisions 

related to tenure in the marketing order. 

Members and alternates may serve on 

the Committee until their respective 

successors are selected and have 

qualified. 

The record shows that USDA 

proposed tenure requirements for 

Committee members as a means to 

increase industry participation on the 

Committee, provide for more diverse 

membership, provide the Committee 

with new perspectives and ideas, and 

increase the number of individuals in 

the industry with Committee 

experience. 

Experience with other marketing 

order programs suggests that a period of 

six years would be appropriate. Since 

the current term of office for 

Washington Cherry Marketing 

Committee members and alternates is 

two years, the Department is proposing 

that no member serve more than three 

consecutive two-year terms or a total of 

six years. This proposal for a limitation 

on tenure would not apply to alternates. 

Once a member has served on the 

Committee for three consecutive terms, 

or six years, the member would sit out 

for one year before being eligible to 

serve as a member again. The member 

could serve as an alternate during that 

time.

One witness testified in opposition to 

tenure limitations. He indicated that 

finding growers and handlers willing to 

serve on the Committee could become 

more difficult, and the knowledge of 

experienced Committee members would 

be difficult to replace. 

The Department believes that any 

additional efforts necessary to find 

eligible growers and handlers who are 

willing to serve on the Committee offset 

by the benefits derived by broader 

industry participation in order 

operations. 

Therefore, it is recommended that the 

order be amended to establish tenure 

requirements for Committee members. 

Material Issue Number 6—Continuance 

Referenda 

Section 923.64, Termination, should 

be amended to require that continuance 

referenda be conducted every six years 

to ascertain industry support for the 

order. 

Currently, there is no provision in the 

marketing order that requires periodic 

continuance referenda. The record 

evidence is that growers should have an 

opportunity to periodically vote on 

whether the marketing order should 

continue. Continuance referenda 

provide an industry with a means to 

measure grower support for the 

marketing order program. Experience 

has shown that programs need 

significant industry support to operate 

effectively. Under this proposal, the 

Department would consider termination 

of the marketing order if continuance is 

not favored by at least two-thirds of 

those voting, or at least two-thirds of the 

volume represented in the referendum. 

This is the same as that for issuance of 

an order. Experience in recent years 

indicates that six years is an appropriate 

Federal Register / Vol. 69, No. 192 / Tuesday, October 5, 2004 / Proposed Rules 59555

period to allow growers an opportunity 

to vote for continuance of the program. 

Therefore, the proposal sets forth that a 

referendum would be conducted six 

years after the effective date of this 

amendment and every sixth year 

thereafter. 

One industry witness testified in 

opposition to this proposal. He 

indicated that the industry currently has 

the ability to request a continuance 

referendum at any time, and requiring 

unnecessary referenda would be costly 

and of little value to the industry or the 

Department. The program has worked 

successfully since its inception, and 

growers have been supportive of the 

order since that time. 

The Department believes that growers 

should have an opportunity to 

periodically vote on whether the 

marketing order should continue. 

Accordingly, it is recommended that the 

order be amended to require a 

continuance referendum every six years. 

The Agricultural Marketing Service 

also proposed to make such changes as 

may be necessary to the order to 

conform to any amendment that may 

result from the hearing. The Department 

has identified no necessary conforming 

changes. 

Small Business Consideration 

Pursuant to the requirements set forth 

in the Regulatory Flexibility Act (RFA), 

the Agricultural Marketing Service 

(AMS) has considered the economic 

impact of this action on small entities. 

Accordingly, the 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 so that 

small businesses will not be unduly or 

disproportionately burdened. Small 

agricultural growers have been defined 

by the Small Business Administration 

(SBA) (13 CFR 121.201) as those having 

annual receipts of less than $750,000. 

Small agricultural service firms are 

defined as those with annual receipts of 

less than $5,000,000. 

The record shows that there are 

approximately 1,500 growers of sweet 

cherries in the production area and 

approximately 62 handlers subject to 

regulation under the order. The average 

production of sweet cherries in 

Washington State for the last three years 

is 64,676 tons with an average grower 

price of $1,943 per ton. Using this 

number, the average annual grower 

revenue is calculated to be 

approximately $83,777, thus indicating 

that the average Washington sweet 

cherry grower would qualify as a small 

entity according to the SBA definition. 

Using Committee data regarding each 

individual handler’s total shipments 

during the 2002 marketing year, and an 

estimated average FOB price of $24 per 

20-pound container, 79 percent of the 

Washington sweet cherry handlers 

shipped under $5 million worth of 

sweet cherries, and 21 percent shipped 

over $5 million worth of sweet cherries. 

Therefore, the majority of Washington 

sweet cherry handlers may be classified 

as small entities. 

The Committee is currently 

comprised of 10 growers and 6 handlers. 

Both small and large growers and 

handlers are members and member 

alternates on the Committee. Committee 

meetings are widely publicized in 

advance of the meetings and are held in 

a location central to the production area. 

The meetings are open to all industry 

members and all other interested 

persons, who are encouraged to 

participate in the deliberations and 

voice their opinions on topics under 

discussion. 

At a May 22, 2003, full Committee 

meeting, all industry representatives 

present could present their views 

concerning the recommended 

amendments. Both large and small 

businesses were represented. The 

Committee believes that small and large 

entities would benefit equally from the 

proposed amendments. 

Testimony indicates that the proposal 

to include paid advertising and 

production research under the order 

would assist both small and large 

growers and handlers in marketing 

Washington sweet cherry crops. While 

addition of this authority could result in 

increased assessments under the order, 

witnesses stated that the benefits arising 

from these activities, as evidenced by 

similar activities under the Commission, 

would outweigh the costs. 

Similarly, the proposal to add 

authority for supplemental varietal 

assessments could require additional 

payments per individual variety of 

sweet cherry. However, witnesses stated 

that they believed the benefits of those 

research and promotion activities would 

outweigh the costs. 

Witnesses used the example of recent 

Commission activities as evidence that 

research and promotion activities would 

lead to increased grower returns and 

market stability by providing tools to 

the industry to address expanding 

production and evolving consumer 

trends in the industry. Witnesses were 

unanimous in their belief that the 

benefits of the Commission’s activities 

more than outweigh the costs of these 

programs. They stated that the same 

results would be expected from any 

such activities conducted under the 

order.

The proposal to add authority for the 

Committee to accept voluntary 

contributions would not result in any 

increased costs or burdens to the 

industry. In fact, witnesses stated that 

this authority would benefit the 

industry greatly as it could provide for 

additional funding sources of research 

and promotional activities. Safeguards 

against donor control over the use of 

voluntary contributions would ensure 

that these funds would be used in the 

best interest of the industry. The 

Committee would decide how to use 

those funds, and the decision-making 

process would be open to industry input 

and feedback. 

The proposal to add a public member 

and alternate public member to the 

Committee is not expected to result in 

any substantial cost increases. While the 

new members would be entitled to 

reimbursement for their expenses, the 

additional cost would be minimal. 

Additionally, the benefit of adding a 

non-industry, consumer perspective to 

Committee deliberations and decisionmaking could prove very beneficial. 

Witnesses stated that this additional 

perspective would improve the 

Committee’s understanding of the 

consumer in the marketplace and could 

enhance Committee activities aimed at 

increasing consumer demand for 

Washington sweet cherries. 

The proposed amendment to add 

tenure requirements for Committee 

members would allow more persons the 

opportunity to serve as members of the 

Committee. It would provide for more 

diverse membership, provide the 

Committee with new perspectives and 

ideas, and increase the number of 

individuals in the industry with 

Committee experience. 

The proposal to require continuance 

referenda on a periodic basis to 

ascertain grower support for the order 

would allow growers to vote on whether 

to continue the operation of the 

program. The referenda would be 

conducted by USDA. 

Interested persons were invited to 

present evidence at the hearing on the 

probable regulatory and informational 

impacts of the proposed amendments to 

the order on small entities. The record 

evidence is that while some minimal 

costs may occur, those costs would be 

outweighed by the benefits expected to 

accrue to the sweet cherry industry in 

designated counties of Washington. 

The Department has not identified 

any relevant Federal rules that 

duplicate, overlap or conflict with this 

proposed rule. All of the amendments 

are designed to enhance the 

59556 Federal Register / Vol. 69, No. 192 / Tuesday, October 5, 2004 / Proposed Rules 

administration and functioning of the 

program to the benefit of Washington 

cherry growers and handlers. 

A 30-day comment period is provided 

to allow interested persons to respond 

to this proposal. Thirty days is deemed 

appropriate so that this rulemaking may 

be completed prior to the 2005–2006 

season. All written exceptions timely 

received will be considered and a 

grower referendum will be conducted 

before these proposals are implemented. 

Paperwork Reduction Act 

In accordance with the Paperwork 

Reduction Act of 1995 (44 U.S.C. 

Chapter 35), AMS announces its 

intention to request OMB approval of 

any increase in information collection 

burden for the Washington Cherry 

marketing order. 

The Washington Cherry Marketing 

Committee (Committee) recommended 

adding a public member and alternate 

public member to the Committee. In 

conformance with the recommendation, 

a confidential qualification and 

acceptance statement would be used to 

nominate and appoint the public and 

alternate public committee members. 

This form is based on the currently 

approved Confidential Background 

Statement for the Washington Cherry 

Marketing Committee. If this proposal is 

implemented the form would only be 

used after approval by OMB. 

Civil Justice Reform 

The amendments to Marketing Order 

923 proposed herein have been 

reviewed under Executive Order 12988, 

Civil Justice Reform. They are not 

intended to have retroactive effect. If 

adopted, the proposed amendments 

would not preempt any State or local 

laws, regulations, or policies, unless 

they present an irreconcilable conflict 

with this proposal. 

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 Department 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. A handler is 

afforded the opportunity for a hearing 

on the petition. After the hearing, the 

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 the 

Department’s ruling on the petition, 

provided an action is filed not later than 

20 days after the date of the entry of the 

ruling. 

General Findings 

The findings hereinafter set forth are 

supplementary to the findings and 

determinations which were previously 

made in connection with the issuance of 

the marketing agreement and order; and 

all said previous findings and 

determinations are hereby ratified and 

affirmed, except insofar as such findings 

and determinations may be in conflict 

with the findings and determinations set 

forth herein. 

(1) The marketing agreement and 

order, as amended, and as hereby 

proposed to be further amended, and all 

of the terms and conditions thereof, 

would tend to effectuate the declared 

policy of the Act; 

(2) The marketing agreement and 

order, as amended, and as hereby 

proposed to be further amended, 

regulate the handling of sweet cherries 

grown in the production area in the 

same manner as, and are applicable only 

to, persons in the respective classes of 

commercial and industrial activity 

specified in the marketing agreement 

and order upon which a hearing has 

been held; 

(3) The marketing agreement and 

order, as amended, and as hereby 

proposed to be further amended, are 

limited in their application to the 

smallest regional production area which 

is practicable, consistent with carrying 

out the declared policy of the Act, and 

the issuance of several orders applicable 

to subdivisions of the production area 

would not effectively carry out the 

declared policy of the Act; 

(4) The marketing agreement and 

order, as amended, and as hereby 

proposed to be further amended, 

prescribe, insofar as practicable, such 

different terms applicable to different 

parts of the production area as are 

necessary to give due recognition to the 

differences in the production and 

marketing of sweet cherries grown in 

the production area; and 

(5) All handling of sweet cherries 

grown in the production area as defined 

in the marketing agreement and order, is 

in the current of interstate or foreign 

commerce or directly burdens, 

obstructs, or affects such commerce.

List of Subjects in 7 CFR Part 923 

Cherries, Marketing agreements, 

Reporting and recordkeeping 

requirements.

For the reasons set forth in the 

preamble, 7 CFR part 923, is proposed 

to be amended as follows:

PART 923—SWEET CHERRIES 

GROWN IN DESIGNATED COUNTIES 

IN WASHINGTON

1. The authority citation for 7 CFR 

part 923 continues to read as follows:

Authority: 7 U.S.C. 601–674.

2. Section 923.20 is revised to read as 

follows:

§ 923.20 Establishment and membership. 

There is hereby established a 

Washington Cherry Marketing 

Committee consisting of seventeen 

members, each of whom shall have an 

alternate who shall have the same 

qualifications as the member for whom 

he or she is an alternate. Ten members 

and their respective alternates shall be 

growers or officers or employees of 

corporate growers. Six of the members 

and their respective alternates shall be 

handlers, or officers or employees of 

handlers. One member and his or her 

respective alternate shall be a public 

member who is neither a grower nor a 

handler. The ten members of the 

committee who are growers or 

employees or officers of corporate 

growers are referred to in this part as 

‘‘grower members’’ of the committee; 

and six members of the committee who 

shall be handlers, or officers or 

employees of handlers are referred to in 

this part as ‘‘handler members’’ of the 

committee. Five of the grower members 

and their respective alternates shall be 

growers of cherries in District 1, and 

five of the grower members and their 

respective alternates shall be growers of 

cherries in District 2. Three of the 

handler members and their respective 

alternates shall be handlers of cherries 

in District 1, and three of the handler 

members and their representative 

alternates shall be handlers of cherries 

in District 2. 

3. Revise § 923.21 to read as follows:

§ 923.21 Term of office. 

The term of office of each member 

and alternate member of the committee 

shall be for two years beginning April 1 

and ending March 31. Members and 

alternate members shall serve in such 

capacities for the portion of the term of 

office for which they are selected and 

have qualified and until their respective 

successors are selected and have 

qualified. Committee members shall not 

serve more than three consecutive 

terms. Members who have served for 

three consecutive terms must leave the 

committee for at least one year before 

becoming eligible to serve again. 

4. Amend § 923.22 by adding a new 

paragraph (b)(4) to read as follows:

Federal Register / Vol. 69, No. 192 / Tuesday, October 5, 2004 / Proposed Rules 59557

§ 923.22 Nomination.

* * * * *

(b) * * * 

(4) The grower and handler members 

of the committee shall nominate the 

public member and alternate public 

member at the first meeting following 

the selection of members for a new term 

of office. 

5. In § 923.41, paragraph (c) is 

redesignated as paragraph (d) and a new 

paragraph (c) is added to read as 

follows:

§ 923.41 Assessments.

* * * * *

(c) Based upon a recommendation of 

the committee or other available 

information, the Secretary shall fix the 

rate of assessment that handlers shall 

pay on all cherries handled during each 

fiscal period, and may also fix 

supplemental rates of assessment on 

individual varieties or subvarieties to 

secure sufficient funds to provide for 

projects authorized under § 923.45. At 

any time during the fiscal period when 

it is determined on the basis of a 

committee recommendation or other 

information that a different rate is 

necessary for all cherries or for any 

varieties or subvarieties, the Secretary 

may modify a rate of assessment and 

such new rate shall apply to any or all 

varieties or subvarieties that are shipped 

during the fiscal period.

* * * * *

6. A new § 923.43 is added to read as 

follows:

§ 923.43 Contributions. 

The committee may accept voluntary 

contributions but these shall only be 

used to pay expenses incurred pursuant 

to § 923.45. Furthermore, such 

contributions shall be free from any 

encumbrances by the donor and the 

committee shall retain complete control 

of their use. 

7. Section § 923.45 is revised to read 

as follows:

§ 923.45 Production and marketing 

research, promotion and market 

development. 

The committee, with the approval of 

the Secretary, may establish or provide 

for the establishment of projects 

involving production research, 

marketing research and development, 

and marketing promotion, including 

paid advertising, designed to assist, 

improve, or promote the marketing, 

distribution, consumption or efficient 

production of cherries. The expense of 

such projects shall be paid from funds 

collected pursuant to §§ 923.41 and 

923.43. 

8. Section 923.64 is amended by: 

A. Revising paragraph (c). 

B. Redesignating paragraph (d) as 

paragraph (e). 

C. Adding a new paragraph (d). 

The revisions read as follows:

§ 923.64 Termination.

* * * * *

(c) The Secretary shall terminate the 

provisions of this part whenever it is 

found that such termination is favored 

by a majority of growers who, during a 

representative period, have been 

engaged in the production of cherries: 

Provided, that such majority has, during 

such representative period, produced 

for market more than 50 percent of the 

volume of such cherries produced for 

market. 

(d) The Secretary shall conduct a 

referendum six years after the effective 

date of this section and every sixth year 

thereafter, to ascertain whether 

continuance of this subpart is favored 

by growers. The Secretary may 

terminate the provisions of this subpart 

at the end of any fiscal period in which 

the Secretary has found that 

continuance of this subpart is not 

favored by growers who, during a 

representative period determined by the 

Secretary, have been engaged in the 

production of cherries in the production 

area.

* * * * *

Dated: September 29, 2004. 

A.J. Yates, 

Administrator, Agricultural Marketing 

Service.

[FR Doc. 04–22303 Filed 10–4–04; 8:45 am] 

BILLING CODE 3410–02–P

DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration 

14 CFR Part 39 

[Docket No. 2003–NM–16–AD] 

RIN 2120–AA64 

Airworthiness Directives; Airbus Model 

A300 B2 and B4 Series Airplanes

AGENCY: Federal Aviation 

Administration, DOT.

ACTION: Supplemental notice of 

proposed rulemaking; reopening of 

comment period. 

SUMMARY: This document revises an 

earlier proposed airworthiness directive 

(AD), applicable to all Airbus Model 

A300 B2 and B4 series airplanes, that 

would have superseded an existing AD 

that currently requires determining the 

part and amendment numbers of the 

variable lever arm (VLA) of the rudder 

control system to verify that the parts 

were installed using the correct 

standard, and corrective actions if 

necessary. For certain VLAs, the 

proposed AD would also have required 

repetitive inspections for damage, and 

replacement with a new VLA if 

necessary. This new action revises the 

proposed AD by mandating a 

terminating modification of the VLA, 

which would end the repetitive 

inspections. This new action also 

changes the applicability in the 

proposed AD. The actions specified by 

this new proposed AD are intended to 

prevent failure of both spring boxes of 

certain VLAs due to corrosion damage, 

which could result in loss of rudder 

control and consequent reduced 

controllability of the airplane. This 

action is intended to address the 

identified unsafe condition.

DATES: Comments must be received by 

October 26, 2004.

ADDRESSES: Submit comments in 

triplicate to the Federal Aviation 

Administration (FAA), Transport 

Airplane Directorate, ANM–114, 

Attention: Rules Docket No. 2003–NM–

16–AD, 1601 Lind Avenue, SW., 

Renton, Washington 98055–4056. 

Comments may be inspected at this 

location between 9 a.m. and 3 p.m., 

Monday through Friday, except Federal 

holidays. Comments may be submitted 

via fax to (425) 227–1232. Comments 

may also be sent via the Internet using 

the following address: 9-anmnprmcomment@faa.gov. Comments sent 

via fax or the Internet must contain 

‘‘Docket No. 2003–NM–16–AD’’ in the 

subject line and need not be submitted 

in triplicate. Comments sent via the 

Internet as attached electronic files must 

be formatted in Microsoft Word 97 or 

2000 or ASCII text. 

The service information referenced in 

the proposed rule may be obtained from 

Airbus, 1 Rond Point Maurice Bellonte, 

31707 Blagnac Cedex, France. This 

information may be examined at the 

FAA, Transport Airplane Directorate, 

1601 Lind Avenue, SW., Renton, 

Washington.

FOR FURTHER INFORMATION CONTACT: Dan 

Rodina, Aerospace Engineer, 

International Branch, ANM–116, FAA, 

Transport Airplane Directorate, 1601 

Lind Avenue, SW., Renton, Washington 

98055–4056; telephone (425) 227–2125; 

fax (425) 227–1149.

SUPPLEMENTARY INFORMATION: 

Comments Invited 

Interested persons are invited to 

participate in the making of the 

proposed rule by submitting such 

written data, views, or arguments as