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[Federal Register Volume 78, Number 93 (Tuesday, May 14, 2013)]
[Proposed Rules]
[Pages 28149-28152]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-11392]

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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 929

[Doc. No. AMS-FV-12-0042; FV12-929-2 PR]

Cranberries Grown in States of Massachusetts, Rhode Island, 
Connecticut, New Jersey, Wisconsin, Michigan, Minnesota, Oregon, 
Washington, and Long Island in the State of New York; Revising 
Determination of Sales History

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule.

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SUMMARY: This proposed rule invites comments on revisions to the 
determination of sales history provisions currently prescribed under 
the cranberry marketing order (order). The order regulates the handling 
of cranberries grown in Massachusetts, Rhode Island, Connecticut, New 
Jersey, Wisconsin, Michigan, Minnesota, Oregon, Washington, and Long 
Island in the State of New York, and is administered locally by the 
Cranberry Marketing Committee (Committee). This change would modify 
sales history calculations so that they would be applicable for future 
seasons and would adjust the number of years that could be considered 
when determining the highest four years of past sales.

DATES: Comments must be received by June 13, 2013.

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 
proposal 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 comments will be made public on the Internet at the 
address provided above.

FOR FURTHER INFORMATION CONTACT: Doris Jamieson, Marketing Specialist, 
or Christian D. Nissen, Regional Director, Southeast Marketing Field 
Office, Marketing Order and Agreement Division, Fruit and Vegetable 
Program, AMS, USDA; Telephone: (863) 324-3375, Fax: (863) 325-8793, or 
Email: Doris.Jamieson@ams.usda.gov or Christian.Nissen@ams.usda.gov.
    Small businesses may request information on complying with this 
proposed regulation by contacting Jeffrey Smutny, Marketing Order and 
Agreement Division, Fruit and Vegetable Program, AMS, USDA, 1400 
Independence Avenue SW., STOP 0237, Washington, DC 20250-0237; 
Telephone: (202) 720-2491, Fax: (202) 720-8938, or Email: 
Jeffrey.Smutny@ams.usda.gov.

SUPPLEMENTARY INFORMATION: This proposed rule is issued under Marketing 
Agreement and Order No. 929, as amended (7 CFR part 929), regulating 
the handling of cranberries produced in Massachusetts, Rhode Island, 
Connecticut, New Jersey, Wisconsin, Michigan, Minnesota, Oregon, 
Washington, and Long Island in the State of New York, 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 proposed rule 
in conformance with Executive Order 12866.
    This proposal has been reviewed under Executive Order 12988, Civil 
Justice Reform. This proposed rule is not intended to have retroactive 
effect.
    The Act provides that administrative proceedings must be exhausted 
before

[[Page 28150]]

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 proposal invites comments on revisions to the rules and 
regulations pertaining to the determination of grower sales history 
currently prescribed under the order. This change would modify sales 
history calculations so that they would be applicable for future 
seasons and would adjust the number of years that could be considered 
when determining the highest four years of past sales. These changes 
were unanimously recommended by the Committee at a meeting on February 
20, 2012.
    The order provides authority for volume control in the form of a 
grower allotment program. This program provides a method for limiting 
the quantity of cranberries that handlers may purchase or handle on 
behalf of growers in years of oversupply. Under this program, a 
marketable quantity and allotment percentage are established by the 
Committee. Each grower's sales history is calculated by averaging 
recent years' sales data using information submitted by the grower on a 
production and eligibility report filed with the Committee. If volume 
control regulations are to be implemented, each grower's allotment is 
then calculated by multiplying the allotment percentage by the grower's 
sales history.
    Section 929.48 of the order prescribes provisions for computing 
grower sales history. These provisions include a requirement that a new 
sales history be calculated for each grower after each crop year, using 
the formula established in Sec.  929.48(a) or such other formula as 
determined by the Committee, with the approval of the Secretary. 
Section 929.149 provides another formula for calculating grower sales 
history, which includes provisions for additional sales history to make 
calculations more equitable for growers with new acreage. The 
calculations in this section are currently based on, and specifically 
reference, the six years immediately preceding the last year volume 
regulation was in effect, 2001-02, making them applicable for only the 
one season. This section also specifies that sales history can be 
calculated using the average of the highest four of the most recent 
seven years of sales for acreage with seven or more years of sales 
history.
    In an effort to update the regulations pertaining to the 
calculation of grower sales history, the Committee recommended two 
changes to Sec.  929.149. The first change would remove the outdated 
references to specific years used in calculating sales history. The 
second change would reduce the maximum number of years of sales that 
could be used to determine the highest four years of sales from seven 
years to six years.
    The formula for determining sales history in Sec.  929.149 was 
developed specifically for the implementation of volume regulation 
during the 2001-02 season, the last time volume regulation was used 
under the order. The Committee developed the formula to address 
potential inequities that could result when calculating sales history, 
especially in regards to new acreage. Because a cranberry bog does not 
reach full production capacity until several years after being planted, 
using an average of early sales for bogs which have not reached 
maturity could result in a sales history that does not reflect future 
sales potential. Because calculated sales history impacts the amount of 
allotment received under volume regulation, it is important that the 
calculated sales history is as representative of grower sales as 
possible.
    Therefore, in 2001 the Committee created a formula to determine an 
amount of additional sales history per acre to be applied to acreage 
planted in 1995, 1996, 1997, 1998, 1999, and 2000. To help establish 
the additional amount of sales volume to be provided for new acreage, 
the Committee and USDA conducted surveys to determine average yields on 
new acreage over the first five years of production. Recognizing that 
the averages may not be reflective of all growers, the averages were 
adjusted upward by 25 barrels and were used to calculate the numbers 
for additional sales history provided in Table 1 in Sec.  929.149 for 
bogs planted from 1995 through 2000.
    At its February 20, 2012, meeting, the Committee discussed the 
volume regulation provisions in the order's rules and regulations and 
how these provisions may need to be updated for upcoming seasons in the 
event volume regulation is implemented. The Committee reviewed Sec.  
929.149 and how it calculates sales history and agreed that the 
adjustments for additional sales history were still important in 
establishing equity for new acreage.
    Recognizing the specific dates currently in Sec.  929.149 are not 
applicable for future seasons, the Committee recommended revising this 
section to remove the date-specific language so that it would be 
applicable to each individual season. Rather than referring to acreage 
planted in the years 1995 through 2000, the proposed amendment would 
refer to acreage planted between one and six years prior to the current 
season. With this change, Sec.  929.149 would be applicable to the 
calculation of grower sales history for any season, making the 
additional sales history adjustment available to growers with new 
acreage.
    In regards to the specific amounts of additional sales history per 
acre provided for new acreage in Table 1 in Sec.  929.149, the 
Committee recommended no change. While the amounts were based on 
production data collected in 2000, the majority of cranberry production 
still comes from the same variety as in 2000, as do the majority of new 
plantings. Further, with the average yields used to calculate the 
amounts increased by 25 barrels, the calculated yields used to develop 
the additional sales history should still be reflective of the average 
yields for new acreage. Therefore, the current amounts of additional 
sales history to be applied per acre for new or re-planted cranberry 
acreage would remain unchanged by this proposed rule.
    The Committee also discussed the time period that should be used to 
determine a grower's highest four years of sales when calculating sales 
history. Section 929.149 currently uses the average of the highest four 
of the most recent seven years of sales for acreage with seven or more 
years of sales history. The formula in Sec.  929.48 calculates sales 
history using the average of the highest four of the most recent six 
years of sales. The additional year provided for in Sec.  929.149 was 
to compensate growers for possible lower sales numbers stemming from 
volume regulation in 2000-01, so that grower sales history would be 
more reflective of their typical sales. Committee members agreed that 
since volume regulation has not been implemented for more than six 
years, the additional year is no longer needed, and that the most 
recent six years of sales data would be adequate for determining a 
grower's highest four years of sales.

[[Page 28151]]

    Therefore, this proposed rule would revise Sec.  929.149 to remove 
the outdated references to specific years so that its provisions could 
be utilized to calculate a grower's sales history for all future 
seasons. The proposed rule would also reduce the time period used to 
determine the highest four years of sales from seven years to six 
years.

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 55 handlers of cranberries who are subject 
to regulation under the marketing order and approximately 1,200 
cranberry producers in the regulated area. Small agricultural service 
firms are 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).
    Based on Committee data and information from the National 
Agricultural Statistics Service, the average annual f.o.b. price of 
cranberries during the 2011 season was approximately $43.90 per barrel 
and total shipments were approximately 7.5 million barrels. Using the 
average f.o.b. price and shipment data, the majority of cranberry 
handlers could be considered small businesses under SBA's definition. 
In addition, based on production, producer prices, and the total number 
of cranberry growers, the average grower revenue is less than $750,000. 
Therefore, the majority of growers and handlers of cranberries may be 
considered small entities.
    This proposal would revise the rules and regulations pertaining to 
the determination of sales history currently prescribed under the order 
in Sec.  929.149. This change would update sales history calculations 
so that they would be applicable for future seasons and would adjust 
the number of years that could be considered when determining the 
highest four years of past sales. These changes were unanimously 
recommended by the Committee at a meeting on February 20, 2012. 
Authority for these changes is provided in Sec.  929.48 of the order.
    It is not anticipated that this action would impose any additional 
costs on the industry. Each year, the Committee is required to 
calculate a sales history for each grower. This rule would update Sec.  
929.149 making its provisions for calculating grower sales history 
applicable to any season. Reducing the number of seasons that can be 
considered when determining the highest four years of sales from seven 
years to six years in this section, could result in a slightly lower 
average for the highest four years. However, as this change makes this 
section reflect the calculation currently used by the industry for the 
highest four, and given that a grower allotment volume regulation has 
not been implemented in more than ten years, the effects of this change 
should be minimal.
    Further, the provisions in Sec.  929.149 were developed to make the 
calculations of sales history more equitable for growers with new 
acreage. Because a cranberry bog does not reach full production 
capacity until several years after being planted, using an average of 
early sales for bogs which have not reached maturity could result in 
sales histories that do not reflect future sales potential. As 
calculated sales history impacts the amount of allotment received under 
volume regulation, it is important that the calculated sales history is 
as representative of grower sales as possible. Revising the 
calculations in Sec.  929.149 could actually increase the calculated 
amount of sales history for new acreage, which in turn would provide 
the grower with additional allotment should volume regulation be 
implemented. The benefits of this rule are not expected to be 
disproportionately greater or less for small handlers or growers than 
for large entities.
    The Committee considered one alternative to these changes: making 
no change to the rules and regulations pertaining to the determination 
of sales history. The Committee recognized making no revisions to the 
way sales history is calculated under Sec.  929.149 could mean new 
acreage not yet producing at full capacity could receive sales history 
below their potential average. Therefore, this alternative was 
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. 0581-0189, Generic Fruit Crops. 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 cranberry 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.
    In addition, USDA has not identified any relevant Federal rules 
that duplicate, overlap or conflict with this proposed rule.
    Further, the Committee's meeting was widely publicized throughout 
the cranberry industry and all interested persons were invited to 
attend the meeting and participate in Committee deliberations on all 
issues. Like all Committee meetings, the February 20, 2012, 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 Jeffrey Smutny 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 so this 
rule would be in place prior to August, when the Committee is planning 
its next industry meeting. At this meeting, the Committee members would 
need to know how sales history would be calculated for any discussions 
they may have regarding producer allotment volume regulation. All 
written comments timely received will be considered before a final 
determination is made on this matter.

[[Page 28152]]

List of Subjects in 7 CFR Part 929

    Cranberries, Marketing agreements, Reporting and recordkeeping 
requirements.

    For the reasons set forth in the preamble, 7 CFR part 929 is 
proposed to be amended as follows:

PART 929--CRANBERRIES GROWN IN THE STATES OF MASSACHUSETTS, RHODE 
ISLAND, CONNECTICUT, NEW JERSEY, WISCONSIN, MICHIGAN, MINNESOTA, 
OREGON, WASHINGTON, AND LONG ISLAND IN THE STATE OF NEW YORK

0
1. The authority citation for 7 CFR part 929 continues to read as 
follows:

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

0
2. Section 929.149 is amended by
0
a. Revising paragraph (a);
0
b. Revising the first sentence in paragraph (b);
0
c. Revising paragraphs (c) and (d), and Table 1 to read as follows:

Sec.  929.149  Determination of sales history.

* * * * *
    (a) For each grower with acreage with 6 or more years of sales 
history, a new sales history shall be computed using an average of the 
highest 4 of the most recent 6 years of sales. If the grower has 
acreage with 5 years of sales history and such acreage was planted more 
than 6 years ago, a new sales history shall be computed by averaging 
the highest 4 of the 5 years.
    (b) For growers whose acreage has 5 years of sales history and was 
planted 6 years ago or later, the sales history shall be computed by 
averaging the highest 4 of the 5 years and shall be adjusted as 
provided in paragraph (d). * * *
    (c) For growers with acreage with no sales history or for the first 
harvest of re-planted acres, the sales history will be 75 barrels per 
acre for acres planted or re-planted 1 year ago and first harvested in 
the current crop year and 156 barrels per acre for acres planted or re-
planted 2 years ago and first harvested in the current crop year.
    (d) In addition to the sales history computed in accordance with 
paragraphs (a) and (b) of this section, additional sales history shall 
be assigned to growers with acreage planted in the last 6 years. The 
additional sales histories depending on the date the acreage is planted 
are shown in Table 1.

          Table 1--Additional Sales History Assigned to Acreage
------------------------------------------------------------------------
                                                           Additional
                                                       current crop year
                     Date planted                      sales history per
                                                              acre
------------------------------------------------------------------------
6 years ago..........................................                 49
5 years ago..........................................                117
4 years ago..........................................                157
3 years ago..........................................                183
2 years ago..........................................                156
1 year ago...........................................                 75
------------------------------------------------------------------------

* * * * *

    Dated: May 9, 2013.
David R. Shipman,
Administrator, Agricultural Marketing Service.
[FR Doc. 2013-11392 Filed 5-13-13; 8:45 am]
BILLING CODE 3410-02-P
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