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

12748 

Vol. 77, No. 42 

Friday, March 2, 2012 

DEPARTMENT OF AGRICULTURE 

Agricultural Marketing Service 

7 CFR Part 930 

[Doc. No. AMS–FV–11–0085; FV11–930–3 

PR] 

Tart Cherries Grown in the States of 

Michigan, et al.; Final Free and 

Restricted Percentages for the 2011–12 

Crop Year for Tart Cherries 

AGENCY: Agricultural Marketing Service, 

USDA. 

ACTION: Proposed rule. 

SUMMARY: This rule invites comments 

on the establishment of final free and 

restricted percentages for the 2011–12 

crop year under the marketing order for 

tart cherries grown in the states of 

Michigan, New York, Pennsylvania, 

Oregon, Utah, Washington, and 

Wisconsin (order). The order is 

administered locally by the Cherry 

Industry Administrative Board (Board). 

This action would establish the 

proportion of tart cherries from the 2011 

crop which may be handled in 

commercial outlets at 88 percent free 

and 12 percent restricted. These 

percentages should stabilize marketing 

conditions by adjusting supply to meet 

market demand and help improve 

grower returns. 

DATES: Comments must be received by 

April 2, 2012. 

ADDRESSES: Interested persons are 

invited to submit written comments 

concerning this proposal. Comments 

must be sent to the Docket Clerk, 

Marketing Order and Agreement 

Division, Fruit and Vegetable Program, 

AMS, USDA, 1400 Independence 

Avenue SW., STOP 0237, Washington, 

DC 20250–0237; Fax: (202) 720–8938; or 

Internet: http://www.regulations.gov. All 

comments should reference the 

document number and the date and 

page number of this issue of the Federal 

Register and will be made available for 

public inspection in the Office of the 

Docket Clerk during regular business 

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

www.regulations.gov. All comments 

submitted in response to this rule will 

be included in the record and will be 

made available to the public. 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: 

Jennie M. Varela, Marketing Specialist, 

or Christian D. Nissen, Regional 

Manager, Southeast Marketing Field 

Office, Marketing Order and Agreement 

Division, Fruit and Vegetable Programs, 

AMS, USDA; Telephone: (863) 324– 

3375, Fax: (863) 325–8793, or Email: 

Jennie.Varela@ams.usda.gov or 

Christian.Nissen@ams.usda.gov. 

Small businesses may request 

information on complying with this 

regulation by contacting Laurel May, 

Marketing Order and Agreement 

Division, 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 Email: 

Laurel.May@ams.usda.gov. 

SUPPLEMENTARY INFORMATION: This 

proposal is issued under Marketing 

Agreement and Order No. 930, both as 

amended (7 CFR part 930), regulating 

the handling of tart cherries produced in 

the States of Michigan, New York, 

Pennsylvania, Oregon, Utah, 

Washington and Wisconsin, 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 proposal has been reviewed 

under Executive Order 12988, Civil 

Justice Reform. Under the order 

provisions now in effect, final free and 

restricted percentages may be 

established for tart cherries handled 

during the crop year. This proposed rule 

would establish final free and restricted 

percentages for tart cherries for the 

2011–12 crop year, beginning July 1, 

2011, through June 30, 2012. 

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. A 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 invites comments on the 

establishment of final free and restricted 

percentages for the 2011–12 crop year. 

This action would establish the 

proportion of tart cherries from the 2011 

crop which may be handled in 

commercial outlets at 88 percent free 

and 12 percent restricted. These 

percentages should stabilize marketing 

conditions by adjusting supply to meet 

market demand and help improve 

grower returns. The action was 

recommended by the Board at a meeting 

on September 15, 2011. 

Section 930.51(a) of the order 

provides authority to regulate volume 

by designating free and restricted 

percentages for any tart cherries 

acquired by handlers in a given crop 

year. Section 930.50 prescribes 

procedures for computing an optimum 

supply based on sales history and for 

calculating these free and restricted 

percentages. Free percentage volume 

may be shipped to any market, while 

restricted percentage volume must be 

held by handlers in a primary or 

secondary reserve, or be diverted or 

used for exempt purposes as prescribed 

in §§ 930.159 and 930.162 of the 

regulations. These activities include, in 

part, the development of new products, 

sales into new markets, the 

development of export markets, and 

charitable contributions. 

Under § 930.52, only those districts 

with an annual average production of at 

least six million pounds are subject to 

regulation and any district producing a 

crop which is less than 50 percent of its 

annual average is exempt. The regulated 

districts for the 2011–2012 crop year 

would be: District 1—Northern 

Michigan; District 2—Central Michigan; 

District 3—Southern Michigan; District 

mstockstill on DSK4VPTVN1PROD with PROPOSALS

Federal Register / Vol. 77, No. 42 / Friday, March 2, 2012 / Proposed Rules 12749 

4—New York; District 7—Utah; and 

District 8—Washington. Districts 5, 6, 

and 9 (Oregon, Pennsylvania, and 

Wisconsin, respectively) would not be 

regulated for the 2011–12 season. 

Demand for tart cherries and tart 

cherry products tends to be relatively 

stable from year to year. Conversely, 

annual tart cherry production can vary 

greatly. In addition, tart cherries are 

processed and can be stored and carried 

over from crop year to crop year, further 

impacting supply. As a result, supply 

and demand for tart cherries are rarely 

in balance. 

Because demand for tart cherries is 

inelastic, total sales volume is not very 

responsive to changes in price. 

However, prices are very sensitive to 

changes in supply. As such, an 

oversupply of cherries would have a 

sharp negative effect on prices, driving 

down grower returns. The Board, aware 

of this economic relationship, focuses 

on using the volume control provisions 

in the order to balance supply and 

demand to stabilize industry returns. 

Pursuant to § 930.50 of the order, the 

Board meets on or about July 1 to review 

sales data, inventory data, current crop 

forecasts and market conditions for the 

upcoming season and, if necessary, to 

recommend preliminary free and 

restricted percentages if anticipated 

supply would exceed demand. After 

harvest is complete, but no later than 

September 15, the Board meets again to 

update their calculations using actual 

production data, consider any necessary 

adjustments to the preliminary 

percentages, and determine if final free 

and restricted percentages should be 

recommended to the Secretary. 

To assist in this process, the Board 

uses an optimum supply formula (OSF), 

a series of mathematical calculations 

using sales history, inventory, and 

production data to determine whether 

there is a surplus, and if so, how much 

volume should be restricted to maintain 

optimum supply. The optimum supply 

represents the desirable volume of tart 

cherries that should be available for sale 

in the coming crop year. Optimum 

supply is defined as the average free 

sales of the prior three years plus 

desirable carry-out inventory. Desirable 

carry-out is the amount of fruit needed 

by the industry to be carried into the 

succeeding crop year to meet marketing 

demand until the new crop is available. 

Desirable carry-out is set by the Board 

after considering market circumstances 

and needs. This figure can range from 

zero to a maximum of 20 million 

pounds. 

To determine whether the industry 

would be in an oversupply situation for 

the coming year, the Board compares 

the optimum supply figure and the total 

anticipated supply for the coming year. 

Anticipated supply includes any 

inventory available at the beginning of 

the season (carry-in) and the current 

year’s estimated production. The carryin figure is subtracted from the optimum 

supply to determine the volume of 

cherries that would need to be produced 

in the current year to provide what is 

needed to meet the optimum supply. If 

estimated production is less than the 

optimum supply minus carry-in, the 

Board is required to establish a free 

percentage of 100 percent and a 

restricted percentage of zero. If 

production is greater than the optimum 

supply minus carry-in, the difference is 

considered surplus. To calculate the 

restricted percentage, this surplus 

tonnage is divided by the sum of 

production in the regulated districts. 

The Board met on June 23, 2011, and 

computed an optimum supply of 174 

million pounds for the 2011–12 crop 

year, using the free sales for the three 

previous seasons and setting the 

desirable carry-out at zero. The Board 

then subtracted the estimated carry-in of 

57 million pounds from the optimum 

supply to calculate the production 

needed from the 2011–12 crop to meet 

optimum supply. This number, 117 

million pounds, was subtracted from 

USDA’s estimated 2011–12 production 

of 266 million pounds to calculate a 

surplus of 149 million pounds of tart 

cherries. The surplus was then divided 

by the expected production in the 

regulated districts (253 million pounds) 

to reach a preliminary restricted 

percentage of 59 percent for the 2011– 

12 crop year. 

In discussing the results of the OSF 

calculations, members were in 

agreement that a restriction was 

necessary in order to avoid 

oversupplying the market. However, 

there was discussion that a 59 percent 

restriction may be too restrictive 

considering current market conditions. 

Board members recognized that the 

previous season, inventory had been 

tight, requiring two releases from 

reserves to meet sales needs. Further, it 

was stated that exports would likely 

remain strong in the coming season due 

to poor production in Europe. 

Consequently, the Board concluded 

market conditions justified making an 

economic adjustment, and the Board 

voted to add 30 million pounds to free 

supply, reducing the calculated surplus 

from 149 million pounds to 119 million 

pounds. 

In addition, USDA’s ‘‘Guidelines for 

Fruit, Vegetable, and Specialty Crop 

Marketing Orders’’ specify that 110 

percent of recent years’ sales should be 

made available to primary markets each 

season before recommendations for 

volume regulation are approved. 

Accordingly, § 930.50(g) of the order 

specifies that in years when restricted 

percentages are established, the Board 

shall make available tonnage equivalent 

to an additional 10 percent of the 

average sales of the prior three years for 

market expansion (market growth 

factor). The Board complied with this 

requirement by adding 17 million 

pounds (174 million times 10 percent) 

to the free supply, further reducing the 

surplus to 102 million pounds. After 

these two adjustments, the preliminary 

restricted percentage was recalculated 

as 40 percent, as outlined in the 

following table: 

Millions of 

pounds 

Preliminary Calculations: 

(1) Average sales of the prior 

three years ............................ 174 

(2) Plus desirable carry-out ...... 0 

(3) Optimum supply calculated 

by the Board .......................... 174 

(4) Carry-in as of June 23, 

2011 ....................................... 57 

(5) Adjusted optimum supply 

(item 3 minus item 4) ............ 117 

(6) USDA crop estimate ............ 266 

(7) Surplus (item 6 minus item 

5) ........................................... 149 

(8) Economic adjustment .......... 30 

(9) Market growth factor ........... 17 

(10) Adjusted Surplus (item 7 

minus items 8 and 9) ............ 102 

(11) Crop estimate for regulated 

districts .................................. 253 

Percent 

Preliminary Percentages: 

Restricted (item 10 divided by 

item 11 × 100) ....................... 40 

Free (100 minus restricted percentage) ................................. 60 

The Board met again September 15, 

2011, to consider establishing final 

volume regulation percentages for the 

2011–12 season. The final percentages 

are based on the Board’s reported 

production figures and the supply and 

demand information available in 

September. The actual production for 

the 2011–12 season was 231 million 

pounds, 35 million pounds below 

USDA’s June estimate. Concerned about 

having an adequate volume of cherries 

in the free market with actual 

production below the estimate, the 

Board voted to make a further 

adjustment of 40 million pounds in 

addition to the June adjustment. Using 

the actual production numbers, and 

accounting for the two adjustments, as 

well as the market growth factor, the 

restricted percentage was recalculated. 

mstockstill on DSK4VPTVN1PROD with PROPOSALS

12750 Federal Register / Vol. 77, No. 42 / Friday, March 2, 2012 / Proposed Rules 

The Board used the same carry-in 

figure used in June of 57 million 

pounds, and subtracted it from the 

optimum supply of 174 million pounds, 

calculating the 2011–12 production 

volume required to meet the optimum 

supply of 117 million pounds. The 117 

million pounds was subtracted from the 

actual production of 231 million 

pounds, resulting in a surplus of 114 

million pounds of tart cherries. The 

surplus was then reduced by subtracting 

the two economic adjustments of 30 

million pounds and 40 million pounds, 

and the market growth factor of 17 

million pounds, resulting in an adjusted 

surplus of 27 million pounds. This 

surplus was then divided by the actual 

production in the regulated districts 

(218 million pounds) to calculate a 

restricted percentage of 12 percent with 

a corresponding free percentage of 88 

percent for the 2011–12 crop year, as 

outlined in the following table: 

Millions of 

pounds 

Final Calculations: 

(1) Average sales of the prior 

three years ............................ 174 

(2) Plus desirable carry-out ...... 0 

(3) Optimum supply calculated 

by the Board .......................... 174 

(4) Carry-in as of July 1, 2011 .. 57 

(5) Adjusted optimum supply 

(item 3 minus item 4) ............ 117 

(6) Board reported production .. 231 

(7) Surplus (item 6 minus item 

5) ........................................... 114 

(8) Total economic adjustments 70 

(9) Market growth factor ........... 17 

(10) Adjusted Surplus (item 7 

minus items 8 and 9) ............ 27 

(11) Crop estimate for regulated 

districts .................................. 218 

Percent 

Final Percentages: 

Restricted (item 10 divided by 

item 11 × 100) ....................... 12 

Free (100 minus restricted percentage) ................................. 88 

The primary purpose of setting 

restricted percentages is an attempt to 

bring supply and demand into balance. 

If the primary market is oversupplied 

with cherries, grower prices decline 

substantially. Restricted percentages 

have benefited grower returns and 

helped stabilize the market as compared 

to those seasons prior to the 

implementation of the order. The Board 

believes the available information 

indicates that a restricted percentage 

should be established for the 2011–12 

crop year to avoid oversupplying the 

market with tart cherries. Consequently, 

based on its discussion of this issue and 

the result of the above calculations, the 

Board recommended final percentages 

of 88 percent free and 12 percent 

restricted by a vote of 13 in favor and 

4 against. 

Of the four Board members who 

opposed the recommendation, one 

believed regulation was unnecessary for 

the current crop year, while the other 

three believed the recommended 

percentages were not restrictive enough. 

The member who believed the 

regulation was too restrictive cited 

strong sales in the previous season and 

moderate production volume for this 

crop year. In its discussion regarding the 

establishment of a restricted percentage 

for the 2011–12 crop year, the Board did 

recognize the strong sales in the 

previous season, as well as the fact that 

actual production had come in below 

the production estimate. In response, 

the Board voted to make two 

adjustments to make additional volume 

available. However, the majority of 

Board members still held that market 

conditions warranted some level of 

restriction. Further, the Board could 

meet and recommend the release of 

additional volume during the crop year, 

if warranted. 

One of those who opposed the 

recommendation as not being restrictive 

enough stated that making the two 

adjustments and increasing the free 

volume this season could result in large 

inventories carrying over into the next 

season, which would require increased 

restrictions and dampen prices. Another 

stated that strong demand might not be 

sustained in the coming year and 

making additional fruit available at the 

onset of the season was premature and 

could result in an oversupply of the 

market. One opponent also stated that 

rather than making adjustments now, 

the Board could vote to release a portion 

of reserves later in the season to provide 

more fruit if necessary. However, most 

Board members believed that making 

more fruit available to the market was 

warranted. Board members cited the two 

releases from the previous season, sales 

volume from last year, and the smaller 

than anticipated crop in support of 

making more free tonnage available. It 

was also argued that increasing the 

volume of cherries available at the onset 

of the season could facilitate additional 

sales. 

After reviewing the available data, 

and considering the concerns expressed, 

the majority of the Board determined 

that a 12 percent restriction would meet 

sales needs without oversupplying the 

market. Thus, the Board recommended 

establishing final percentages of 88 

percent free and 12 percent restricted. 

Initial Regulatory Flexibility Analysis 

Pursuant to requirements set forth in 

the Regulatory Flexibility Act (RFA) (5 

U.S.C. 601–612), the Agricultural 

Marketing Service (AMS) has 

considered the economic impact of this 

action 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 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 40 handlers 

of tart cherries who are subject to 

regulation under the marketing order 

and approximately 600 producers of tart 

cherries in the regulated area. Small 

agricultural service firms have been 

defined by the Small Business 

Administration (SBA) as those having 

annual receipts of less than $7,000,000, 

and small agricultural producers are 

defined as those having annual receipts 

of less than $750,000 (13 CFR 121.201). 

According to the National 

Agricultural Statistics Service, and 

Board data, the average annual grower 

price for tart cherries during the 2010– 

11 season was $0.221 per pound, and 

total shipments were around 270 

million pounds. Therefore, average 

receipts for tart cherry producers were 

around $99,000, well below the SBA 

threshold for small producers. In 2010, 

The Food Institute estimated an f.o.b. 

price of $0.84 per pound for frozen tart 

cherries, which make up the majority of 

processed tart cherries. Using this data, 

average annual handler receipts were 

about $5.7 million, also below the SBA 

threshold for small agricultural service 

firms. Assuming a normal distribution, 

the majority of producers and handlers 

of tart cherries may be classified as 

small entities. 

The tart cherry industry in the United 

States is characterized by wide annual 

fluctuations in production. According to 

the National Agricultural Statistics 

Service, tart cherry production in 2007 

was 253 million pounds, 214 million 

pounds in 2008, 359 million pounds in 

2009, and in 2010, production was 190 

million pounds. Because of these 

fluctuations, the supply and demand for 

tart cherries are rarely in equilibrium. 

Demand for tart cherries is inelastic, 

meaning changes in price have a 

minimal effect on total sales volume. 

However, prices are very sensitive to 

mstockstill on DSK4VPTVN1PROD with PROPOSALS

Federal Register / Vol. 77, No. 42 / Friday, March 2, 2012 / Proposed Rules 12751 

changes in supply, and grower prices 

vary widely in response to the large 

swings in annual supply, with prices 

ranging from a low of 7.3 cents in 1987 

to a high of 46.4 cents in 1991. 

Because of this relationship between 

supply and price, oversupplying the 

market with tart cherries would have a 

sharp negative effect on prices, driving 

down grower returns. The Board, aware 

of this economic relationship, focuses 

on using the volume control authority in 

the order in an effort to balance supply 

and demand in order to stabilize 

industry returns. This authority allows 

the industry to set free and restricted 

percentages as a way to bring supply 

and demand into balance. Free 

percentage cherries can be marketed by 

handlers to any outlet, while restricted 

percentage volume must be held by 

handlers in reserve, be diverted or used 

for exempted purposes. 

This proposal would establish final 

free and restricted percentages for the 

2011–12 crop year under the order for 

tart cherries. This action would control 

the supply of tart cherries by 

establishing percentages of 88 percent 

free and 12 percent restricted for the 

2011–12 crop year. These percentages 

should stabilize marketing conditions 

by adjusting supply to meet market 

demand and help improve grower 

returns. The action would regulate tart 

cherries handled in Michigan, New 

York, Utah, and Washington. The 

authority for this action is provided for 

in §§ 930.51(a) and 930.52 of the order. 

The Board recommended this action at 

a meeting on September 15, 2011. 

As mentioned earlier, the USDA’s 

‘‘Guidelines for Fruit, Vegetable, and 

Specialty Crop Marketing Orders’’ 

specify that 110 percent of recent years’ 

sales should be made available to 

primary markets each season before 

recommendations for volume regulation 

are approved. The quantity available 

under this rule is 110 percent of the 

quantity shipped in the prior three 

years. 

This action would result in some fruit 

being diverted from the primary 

domestic markets. However, there are 

secondary uses available for restricted 

fruit, including the development of new 

products, sales into new markets, the 

development of export markets, and 

being placed in reserve. While these 

alternatives may provide different levels 

of return than the sales to primary 

markets, they play an important role for 

the industry. The areas of new products, 

new markets, and the development of 

export markets utilize restricted fruit to 

develop and expand the market for tart 

cherries. Last season, these areas 

accounted for more than 50 million 

pounds in sales. 

Placing tart cherries into reserves is a 

key part of balancing supply and 

demand. Although the industry must 

bear the costs of handling and storage 

for fruit in reserve, reserves warehouse 

supplies in large crop years in order to 

supplement supplies in short crop 

years. The reserves allow the industry to 

mitigate the impact of oversupply in 

large crop years, while allowing the 

industry to maintain and supply 

markets in years where production falls 

below demand. Further, the costs for 

storage, interest, and handling of the 

cherries are more than offset by the 

increase in price when moving from a 

large crop to a short crop year. 

In addition, this action would be less 

restrictive than in previous seasons and 

would be the lowest restricted 

percentage since 2008. At this level of 

restriction, nearly all restricted fruit 

should be utilized by the end of the crop 

year. Consequently, it is not anticipated 

that this action would unduly burden 

growers or handlers. 

While this action could result in some 

additional costs to the industry, these 

costs are more than outweighed by the 

benefits. The purpose of setting 

restricted percentages is to attempt to 

bring supply and demand into balance. 

If the primary market (domestic) is 

oversupplied with cherries, grower 

prices decline substantially. Without 

volume control, the primary market 

would likely be oversupplied, resulting 

in lower grower prices. 

The three districts in Michigan, along 

with the districts in Utah, New York, 

and Washington are the restricted areas 

for this crop year with a combined total 

production of 218.4 million pounds. A 

12 percent restriction means 192.2 

million pounds would be available to be 

shipped to primary markets from these 

four states. The 192.2 million pounds 

from the restricted districts, the 12.2 

million pounds from the unrestricted 

districts (Oregon, Pennsylvania, and 

Wisconsin), and the 57 million pound 

carry-in inventory would make a total of 

261.4 million pounds available as free 

tonnage for the primary markets. 

To assess the impact that volume 

control has on the prices growers 

receive for their product, an 

econometric model has been developed. 

Based on the model, the use of volume 

control would have a positive impact on 

grower returns for this crop year. With 

volume control, grower prices are 

estimated to be approximately $0.06 per 

pound higher, and total grower revenue 

from processed cherries is estimated to 

be $6.2 million higher than without 

restrictions. The without-restrictions 

scenario assumes that all tart cherries 

produced would be delivered to 

processors for payments. 

Prior to the implementation of the 

order, grower price often did not come 

close to covering the cost of production. 

For the 2011–12 crop year, yield is 

estimated at approximately 6,470 

pounds per acre. At this level of yield, 

the cost of production is estimated to be 

$0.33 per pound (costs were estimated 

by representatives of Michigan State 

University). 

In addition, absent volume control, 

the industry could start to build large 

amounts of unwanted inventories. 

These inventories would have a 

depressing effect on grower prices. The 

econometric model shows for every 1 

million-pound increase in carry-in 

inventories, a decrease in grower prices 

of $0.0037 per pound occurs. 

Retail demand is assumed to be 

highly inelastic which indicates that 

changes in price do not result in 

significant changes in the quantity 

demanded. Consumer prices largely do 

not reflect fluctuations in cherry 

supplies. Therefore, this action should 

have little or no effect on consumer 

prices and should not result in a 

reduction in retail sales. 

The free and restricted percentages 

established by this rule would provide 

the market with optimum supply and 

apply uniformly to all regulated 

handlers in the industry, regardless of 

size. As the restriction represents a 

percentage of a handler’s volume, the 

costs, when applicable, are 

proportionate and should not place an 

extra burden on small entities as 

compared to large entities. 

The stabilizing effects of this action 

would benefit all handlers by helping 

them maintain and expand markets, 

despite seasonal supply fluctuations. 

Likewise, price stability positively 

impacts all growers and handlers by 

allowing them to better anticipate the 

revenues their tart cherries would 

generate. Growers and handlers, 

regardless of size, would benefit from 

the stabilizing effects of this restriction. 

One alternative to this action 

considered was to not regulate the 

volume of the 2011–12 crop. However, 

Board members believed that although 

sales have been strong, there is enough 

of a surplus to necessitate restricting a 

portion of the crop to keep prices stable. 

Another alternative considered was 

setting the carry-out value at 10 or 20 

million pounds in the OSF. Board 

members indicated that such a change 

would require further consideration by 

the Board, and did not receive sufficient 

support. 

mstockstill on DSK4VPTVN1PROD with PROPOSALS

12752 Federal Register / Vol. 77, No. 42 / Friday, March 2, 2012 / Proposed Rules 

The Board also considered differing 

levels of adjustments under the OSF 

when considering supply. The 

alternative adjustments were deemed to 

be either too small to address industry 

needs, or so large that members were 

concerned with creating an oversupply. 

Therefore, these alternatives were 

rejected. 

In accordance with the Paperwork 

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

Chapter 35), the order’s information 

collection requirements have been 

previously approved by the Office of 

Management and Budget (OMB) and 

assigned OMB No. 0581–0177, Tart 

cherries Grown in the States of MI, NY, 

PA, OR, UT, WA, and WI. No changes 

in those requirements as a result of this 

action are necessary. Should any 

changes become necessary, they would 

be submitted to OMB for approval. 

This action would not impose any 

additional reporting or recordkeeping 

requirements on either small or large 

tart cherry handlers. As with all Federal 

marketing order programs, reports and 

forms are periodically reviewed to 

reduce information requirements and 

duplication by industry and public 

sector agencies. 

AMS is committed to complying with 

the E–Government Act, to promote the 

use of the Internet and other 

information technologies to provide 

increased opportunities for citizen 

access to Government information and 

services, and for other purposes. 

USDA has not identified any relevant 

Federal rules that duplicate, overlap or 

conflict with this proposed rule. 

In addition, the Board’s meeting was 

widely publicized throughout the tart 

cherry industry and all interested 

persons were invited to attend the 

meeting and participate in Board 

deliberations on all issues. Like all 

Board meetings, the September 15, 

2011, 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 proposed rule, 

including the regulatory and 

informational impacts of this action on 

small businesses. 

A small business guide on complying 

with fruit, vegetable, and specialty crop 

marketing agreements and orders may 

be viewed at: www.ams.usda.gov/ 

MarketingOrdersSmallBusinessGuide. 

Any questions about the compliance 

guide should be sent to Laurel May at 

the previously mentioned address in the 

FOR FURTHER INFORMATION CONTACT

section. 

A 30-day comment period is provided 

to allow interested persons to respond 

to this proposal. Thirty days is deemed 

appropriate because this rule would 

need to be in place as soon as possible 

since handlers are already shipping tart 

cherries from the 2011–12 crop. All 

written comments timely received will 

be considered before a final 

determination is made on this matter. 

List of Subjects in 7 CFR Part 930 

Marketing agreements, Reporting and 

recordkeeping requirements, Tart 

cherries. 

For the reasons set forth in the 

preamble, 7 CFR part 930 is proposed to 

be amended as follows: 

PART 930—TART CHERRIES GROWN 

IN THE STATES OF MICHIGAN, NEW 

YORK, PENNSYLVANIA, OREGON, 

UTAH, WASHINGTON, AND 

WISCONSIN 

1. The authority citation for 7 CFR 

part 930 continues to read as follows: 

Authority: 7 U.S.C. 601–674. 

2. Section 930.256 is added to read as 

follows: 

Note: This section will not appear in the 

annual Code of Federal Regulations. 

§ 930.256 Final free and restricted 

percentages for the 2011–12 crop year. 

The final percentages for tart cherries 

handled by handlers during the crop 

year beginning on July 1, 2011, which 

shall be free and restricted, respectively, 

are designated as follows: Free 

percentage, 88 percent and restricted 

percentage, 12 percent. 

Dated: February 28, 2012. 

Robert C. Keeney, 

Acting Administrator, Agricultural Marketing 

Service. 

[FR Doc. 2012–5171 Filed 3–1–12; 8:45 am] 

BILLING CODE 3410–02–P 

DEPARTMENT OF AGRICULTURE 

Agricultural Marketing Service 

7 CFR Part 1260 

[Doc. No. AMS–LS–11–0086] 

Beef Promotion and Research; 

Amendment to the Order 

AGENCY: Agricultural Marketing Service, 

USDA. 

ACTION: Proposed rule. 

SUMMARY: This proposed rule would 

expand the contracting authority as 

established under the Beef Promotion 

and Research (Order). The Beef 

Research and Information Act (Act) 

requires that the Beef Promotion 

Operating Committee (BPOC) enter into 

contracts with established national nonprofit industry-governed organizations 

including the Federation of State Beef 

Councils to implement programs of 

promotion, research, consumer 

information, and industry information. 

The Act does not define ‘‘national nonprofit industry governed organization,’’ 

however, the Order states that these 

organizations must be governed by a 

board of directors representing the cattle 

or beef industry on a national basis and 

that they were active and ongoing prior 

to enactment of the Act. This proposed 

rule would change the date requirement 

in the Order so that organizations 

otherwise qualified could be eligible to 

contract with the BPOC for the 

implementation and conduct of Beef 

Checkoff programs if they have been 

active and ongoing for at least two years. 

DATES: Written comments must be 

received by May 1, 2012. 

ADDRESSES: Comments must be posted 

online at www.regulations.gov or sent to 

Craig Shackelford, Agricultural 

Marketing Specialist, Marketing 

Programs Division, Livestock and Seed 

Program, Agricultural Marketing 

Service, USDA, Room 2628–S, STOP 

0251, 1400 Independence Avenue SW., 

Washington, DC 20250–0251; or fax to 

(202) 720–1125. All comments should 

reference the docket number, the date, 

and the page number of this issue of the 

Federal Register. Comments will be 

available for public inspection at the 

aforementioned address, as well as on 

the Internet at http:// 

www.regulations.gov/. 

FOR FURTHER INFORMATION CONTACT: 

Craig Shackelford, Agricultural 

Marketing Specialist, Marketing 

Programs Division, on 202/720–1115, 

fax 202/720–1125, or by email at 

craig.shackelford@ams.usda.gov. 

SUPPLEMENTARY INFORMATION: 

Executive Order 12866 

The Office of Management and Budget 

has waived the review process required 

by Executive Order 12866 for this 

action. 

Executive Order 12988 

This proposed rule has been reviewed 

under Executive Order 12988, Civil 

Justice Reform. It is not intended to 

have retroactive effect. 

Section 11 of the Act provides that 

nothing in the Act may be construed to 

preempt or supersede any other program 

relating to beef promotion organized 

and operated under the laws of the 

United States or any State. There are no 

administrative proceedings that must be 

exhausted prior to any judicial 

challenge to the provisions of this rule. 

mstockstill on DSK4VPTVN1PROD with PROPOSALS