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

12837 

Vol. 86, No. 42 

Friday, March 5, 2021 

DEPARTMENT OF AGRICULTURE 

Agricultural Marketing Service 

7 CFR Part 984 

[Doc. No. AMS–SC–20–0075; SC20–984–2 

PR] 

Walnuts Grown in California; 

Decreased Assessment Rate 

AGENCY: Agricultural Marketing Service, 

USDA. 

ACTION: Proposed rule. 

SUMMARY: This proposed rule would 

implement a recommendation from the 

California Walnut Board (Board) to 

decrease the assessment rate established 

for the 2020–21 and subsequent 

marketing years. The proposed 

assessment rate would remain in effect 

indefinitely unless modified, 

suspended, or terminated. 

DATES: Comments must be received by 

April 5, 2021. 

ADDRESSES: Interested persons are 

invited to submit written comments 

concerning this proposed rule. 

Comments must be sent to the Docket 

Clerk, Marketing Order and Agreement 

Division, Specialty Crops Program, 

AMS, USDA, 1400 Independence 

Avenue SW, Stop 0237, Washington, DC 

20250–0237; Fax: (202) 720–8938; or 

internet: https://www.regulations.gov. 

Comments should reference the 

document number and the date and 

page number of this issue of the Federal 

Register and will be available for public 

inspection in the Office of the Docket 

Clerk during regular business hours, or 

can be viewed at: https://

www.regulations.gov. All comments 

submitted in response to this proposed 

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: 

Bianca Bertrand, Management and 

Program Analyst, or Jeffery Rymer, 

Marketing Specialist, California 

Marketing Field Office, Marketing Order 

and Agreement Division, Specialty 

Crops Program, AMS, USDA; 

Telephone: (559) 487–5901, Fax: (559) 

487–5906, or Email: Biancam.Bertrand@

usda.gov or JefferyM.Rymer@usda.gov. 

Small businesses may request 

information on complying with this 

regulation by contacting Richard Lower, 

Marketing Order and Agreement 

Division, Specialty Crops Program, 

AMS, USDA, 1400 Independence 

Avenue SW, Stop 0237, Washington, DC 

20250–0237; Telephone: (202) 720– 

2491, Fax: (202) 720–8938, or Email: 

Richard.Lower@usda.gov. 

SUPPLEMENTARY INFORMATION: This 

action, pursuant to 5 U.S.C. 553, 

proposes an amendment to regulations 

issued to carry out a marketing order as 

defined in 7 CFR 900.2(j). This proposed 

rule is issued under Marketing Order 

No. 984, as amended (7 CFR part 984), 

regulating the handling of walnuts 

grown in California. Part 984, (referred 

to as ‘‘the Order’’) is effective under the 

Agricultural Marketing Agreement Act 

of 1937, as amended (7 U.S.C. 601–674), 

hereinafter referred to as the ‘‘Act.’’ The 

Board locally administers the Order and 

is comprised of growers and handlers 

operating within the area of production, 

and a public member. 

The Department of Agriculture 

(USDA) is issuing this proposed rule in 

conformance with Executive Orders 

13563 and 13175. This proposed rule 

falls within a category of regulatory 

actions that the Office of Management 

and Budget (OMB) exempted from 

Executive Order 12866 review. 

This proposed rule has been reviewed 

under Executive Order 12988, Civil 

Justice Reform. Under the Order now in 

effect, California walnut handlers are 

subject to assessments. Funds to 

administer the Order are derived from 

such assessments. It is intended that the 

assessment rate would be applicable to 

all assessable walnuts for the 2020–21 

marketing year, and continue until 

amended, suspended, or terminated. 

The Act provides that administrative 

proceedings must be exhausted before 

parties may file suit in court. Under 

section 608c(15)(A) of the Act, any 

handler subject to an order may file 

with USDA a petition stating that the 

order, any provision of the order, or any 

obligation imposed in connection with 

the order is not in accordance with law 

and request a modification of the order 

or to be exempted therefrom. Such 

handler is afforded the opportunity for 

a hearing on the petition. After the 

hearing, USDA would rule on the 

petition. The Act provides that the 

district court of the United States in any 

district in which the handler is an 

inhabitant, or has his or her principal 

place of business, has jurisdiction to 

review USDA’s ruling on the petition, 

provided an action is filed not later than 

20 days after the date of the entry of the 

ruling. 

This proposed rule would decrease 

the assessment rate from $0.0400 per 

kernelweight pound assessable walnuts, 

the rate that was established for the 

2017–18 and subsequent marketing 

years, to $0.0250 per kernelweight 

pound of assessable walnuts handled for 

the 2020–21 and subsequent marketing 

years. 

The Order provides authority for the 

Board, with the approval of USDA, to 

formulate an annual budget of expenses 

and collect assessments from handlers 

to administer the program. The 

members are familiar with the Board’s 

needs and with the costs of goods and 

services in their local area and are thus 

in a position to formulate an appropriate 

budget and assessment rate. The 

assessment rate is formulated and 

discussed in a public meeting. Thus, all 

directly affected persons have an 

opportunity to participate and provide 

input. 

For the 2017–18 and subsequent 

marketing periods, the Board 

recommended, and USDA approved, an 

assessment rate of $0.0400 per 

kernelweight pound of assessable 

walnuts handled. That assessment rate 

would continue in effect from marketing 

year to marketing year unless modified, 

suspended, or terminated by USDA 

upon recommendation and information 

submitted by the Board or other 

information available to USDA. 

On September 11, 2020, the Board 

unanimously recommended 2020–21 

expenditures of $17,990,000 and an 

assessment rate of $0.0250 per 

kernelweight pound of assessable 

walnuts. In comparison, last year’s 

budgeted expenditures were 

$25,760,000. The proposed assessment 

rate of $0.0250 is $0.0150 lower than the 

rate currently in effect. The Board 

recommended decreasing the 

assessment rate to reduce the 


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12838 Federal Register / Vol. 86, No. 42 / Friday, March 5, 2021 / Proposed Rules 

assessment burden on handlers. Funds 

from assessments and from the Board’s 

reserve would be sufficient to cover 

proposed expenses, while maintaining 

the Board’s reserve within the 

requirements of the Order at no more 

than two years’ budgeted expenses. 

The major expenditures 

recommended by the Board for the 

2020–21 marketing year include 

$1,930,000 for employee expenses, 

$283,000 for office expenses, $1,600,000 

for production research, $825,000 for 

grades and standards activities, and 

$13,112,000 for domestic market 

development. Budgeted expenses for 

these items in 2019–20 were $1,896,000, 

$293,000, $2,000,000, $825,000, and 

$20,700,000, respectively. 

The Board derived the recommended 

assessment rate by considering 

anticipated expenses; estimated 

certification (‘‘certification’’ means 

having the walnuts inspected) of 

650,000 tons (inshell), based on a threeyear average; and the amount of funds 

available in the authorized reserve. 

Pursuant to § 984.51(b) of the Order, 

the estimated production is converted to 

a merchantable kernelweight basis using 

a factor of 0.45 (650,000 tons × 2,000 

pounds per ton × 0.45), which yields 

585,000,000 kernelweight pounds. At 

$0.0250 per pound, the new assessment 

rate should generate $14,625,000 in 

assessment income, along with funds 

from the reserve should meet estimated 

expenses of $17,990,000. 

Funds in the reserve (currently 

$20,133,075) would be kept within the 

maximum permitted in § 984.69 of the 

Order of approximately two marketing 

years’ budgeted expenses. The reserve at 

the end of the 2020–21 marketing year 

is anticipated to be $13,258,075. 

The assessment rate proposed in this 

rule would continue in effect 

indefinitely unless modified, 

suspended, or terminated by USDA 

upon recommendation and information 

submitted by the Board or other 

available information. 

Although the modified assessment 

rate would be effective for an indefinite 

period, the Board would continue to 

meet prior to or during each marketing 

year to recommend a budget of expenses 

and consider recommendations for 

modification of the assessment rate. The 

dates and times of Board meetings are 

available from the Board or USDA. 

Board meetings are open to the public 

and interested persons may express 

their views at these meetings. USDA 

would evaluate Board recommendations 

and other available information to 

determine whether modification of the 

assessment rate is needed. Further 

rulemaking would be undertaken as 

necessary. The Board’s 2020–21 budget 

and those for subsequent marketing 

years would be reviewed and, as 

appropriate, approved by USDA. 

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 

proposed rule on small entities. 

Accordingly, AMS has prepared this 

initial regulatory flexibility analysis. 

The purpose of the RFA is to fit 

regulatory actions to the scale of 

businesses subject to such actions in 

order that small businesses will not be 

unduly or disproportionately burdened. 

Marketing orders issued pursuant to the 

Act, and the rules issued thereunder, are 

unique in that they are brought about 

through group action of essentially 

small entities acting on their own 

behalf. 

There are approximately 90 handlers 

subject to regulation under the Order 

and approximately 4,400 walnut 

growers in the production area. The 

Small Business Administration (SBA) 

defines small agricultural service firms 

as those having annual receipts of less 

than $30,000,000, and small agricultural 

producers as those having annual 

receipts of less than $1,000,000 (13 CFR 

121.201). 

The Board reported that 

approximately 82 percent of California’s 

walnut handlers shipped merchantable 

walnuts valued under $30 million 

during the 2018–2019 marketing year 

and would, therefore, be considered 

small handlers according to the SBA 

definition. 

Data from the 2017 Agricultural 

Census, published by USDA’s National 

Agricultural Statistics Service (NASS), 

show that 86 percent of California farms 

growing walnuts had walnut sales of 

less than $1 million. 

An alternative computation that 

includes more recent NASS data starting 

with three-year average value of utilized 

production of $1.263 billion for the 

most recent seasons for which data is 

available (2017/18 through 2019/20). 

Dividing that figure by the number of 

walnut growers (4,400) yields an 

average annual crop value per grower of 

approximately $287,045. This figure is 

well below the SBA small agricultural 

producer threshold of $1,000,000 in 

annual sales. Assuming a normal 

distribution, this provides evidence that 

a large majority of walnut growers can 

be considered small agricultural 

producers according to the SBA 

definition. 

This proposal would decrease the 

assessment rate collected from handlers 

for the 2020–21 and subsequent 

marketing years from $0.0400 to $0.0250 

per kernelweight pound of assessable 

walnuts. The Board unanimously 

recommended 2020–21 expenditures of 

$17,990,000 and an assessment rate of 

$0.0250 per kernelweight pound of 

assessable walnuts. The proposed 

assessment rate of $0.0250 is $0.0150 

lower than the rate currently in effect. 

The quantity of assessable walnuts for 

the 2020–21 marketing year is estimated 

at 650,000 tons (inshell), which is 

equivalent to 585,000,000 kernelweight 

pounds. Thus, the $0.0250 rate should 

provide $14,625,000 in assessment 

income. The Board anticipates that the 

income derived from handler 

assessments, along with funds from the 

Board’s authorized reserve, would be 

adequate to cover budgeted expenses for 

the 2020–2021 marketing year. 

The major expenditures 

recommended by the Board for the 

2020–21 marketing year include 

$1,930,000 for employee expenses, 

$283,000 for office expenses, $1,600,000 

for production research, $825,000 for 

grades and standards activities, and 

$13,112,000 for domestic market 

development. Budgeted expenses for 

these items in 2019–20 were $1,896,000, 

$293,000, $2,000,000, $825,000, and 

$20,700,000, respectively. 

The Board unanimously 

recommended decreasing the 

assessment rate to reduce the 

assessment burden on handlers, and 

recommended utilizing funds from the 

authorized reserve to help cover the 

portion of the Board expenses. 

Prior to arriving at this budget and 

assessment rate, the Board considered 

information from various sources, such 

as the Board’s Executive Committee. 

The Board discussed alternative 

expenditure levels, based upon the 

relative value of various activities to the 

California walnut industry. The Board 

recommended the assessment rate of 

$0.0250 to provide $14,625,000 in 

assessment income based on the 

estimation. The Board determined that 

assessment revenue, along with funds 

from the authorized reserve would be 

adequate to cover budgeted expenses for 

the 2020–21 marketing year. 

Based upon information from the 

National Agricultural Statistics Service 

(NASS), the grower price reported for 

walnuts in 2019 was $1,970 per ton 

($0.99 per pound) of walnuts. In order 

to determine the estimated assessment 

revenue as a percentage of the total 

grower revenue, we calculate the 

assessment rate ($0.0250 per 

kernelweight pound) times the 


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Federal Register / Vol. 86, No. 42 / Friday, March 5, 2021 / Proposed Rules 12839 

estimated production (585,000,000 

kernelweight pounds), which equals the 

assessment revenue of $14,625,000. The 

grower revenue is calculated by 

multiplying the grower price of $1,970 

per ton ($0.99 per kernelweight pound) 

times the estimated production 

(585,000,000 kernelweight pounds), 

which equals the grower revenue of 

$579,150,000. In the final step, dividing 

the assessment revenue by the grower 

revenue, indicates that, for the 2020–21 

marketing year, the estimated 

assessment revenue as a percentage of 

total grower revenue would be about 2.5 

percent. 

This proposed rule would decrease 

the assessment obligation imposed on 

handlers. Assessments are applied 

uniformly on all handlers, and some of 

the costs may be passed on to growers. 

However, decreasing the assessment rate 

reduces the burden on handlers and 

may also reduce the burden on growers. 

The Board’s meeting was widely 

publicized throughout the California 

walnut industry. All interested persons 

were invited to attend the meeting and 

participate in Board deliberations on all 

issues. Like all Board meetings, the 

September 11, 2020, meeting was a 

public meeting and all entities, both 

large and small, were able to express 

views on this issue. Interested persons 

are invited to submit comments on this 

proposed rule, including the regulatory 

and information collection impacts of 

this action on small businesses. 

In accordance with the Paperwork 

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

Chapter 35), the Order’s information 

collection requirements have been 

previously approved by the OMB and 

assigned OMB No. 0581–0178 Vegetable 

and Specialty Crops. No changes in 

those requirements would be necessary 

as a result of this proposed rule. Should 

any changes become necessary, they 

would be submitted to OMB for 

approval. 

This proposed rule would not impose 

any additional reporting or 

recordkeeping requirements on either 

small or large California walnut 

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. 

A small business guide on complying 

with fruit, vegetable, and specialty crop 

marketing agreements and orders may 

be viewed at: https://

www.ams.usda.gov/rules-regulations/ 

moa/small-businesses. Any questions 

about the compliance guide should be 

sent to Richard Lower at the previously 

mentioned address in the FOR FURTHER

INFORMATION CONTACT section. 

A 30-day comment period is provided 

to allow interested persons to respond 

to this proposed rule. 

List of Subjects in 7 CFR Part 984 

Marketing agreements, Reporting and 

recordkeeping requirements, and 

Walnuts. 

For the reasons set forth in the 

preamble, 7 CFR part 984 is proposed to 

be amended as follows: 

PART 984—WALNUTS GROWN IN 

CALIFORNIA 

■ 1. The authority citation for 7 CFR 

part 984 continues to read as follows: 

Authority: 7 U.S.C. 601–674. 

■ 2. Section 984.347 is revised to read 

as follows: 

§ 984.347 Assessment rate. 

On and after September 1, 2020, an 

assessment rate of $0.0250 per 

kernelweight pound is established for 

California merchantable walnuts. 

Bruce Summers, 

Administrator, Agricultural Marketing 

Service. 

[FR Doc. 2021–04569 Filed 3–4–21; 8:45 am] 

BILLING CODE P 

BUREAU OF CONSUMER FINANCIAL 

PROTECTION 

12 CFR Part 1026 

[Docket No. CFPB–2021–0003] 

RIN 3170–AA98 

Qualified Mortgage Definition Under 

the Truth in Lending Act (Regulation 

Z): General QM Loan Definition; Delay 

of Mandatory Compliance Date 

AGENCY: Bureau of Consumer Financial 

Protection. 

ACTION: Proposed rule; request for 

comment. 

SUMMARY: The Bureau of Consumer 

Financial Protection (Bureau) is 

proposing to delay the mandatory 

compliance date of the final rule titled 

Qualified Mortgage Definition under the 

Truth in Lending Act (Regulation Z): 

General QM Loan Definition (General 

QM Final Rule) until October 1, 2022. 

DATES: Comments must be received on 

or before April 5, 2021. 

ADDRESSES: You may submit comments, 

identified by Docket No. CFPB–2021– 

0003 or RIN 3170–AA98, by any of the 

following methods: 

• Federal eRulemaking Portal: http:// 

www.regulations.gov. Follow the 

instructions for submitting comments. 

• Email: 2021-NPRMQMComplianceDateDelay@cfpb.gov. 

Include Docket No. CFPB–2021–0003 or 

RIN 3170–AA98 in the subject line of 

the message. 

• Mail/Hand Delivery/Courier: 

Comment Intake—QM Compliance Date 

Delay, Bureau of Consumer Financial 

Protection, 1700 G Street NW, 

Washington, DC 20552. 

Instructions: The Bureau encourages 

the early submission of comments. All 

submissions should include the agency 

name and docket number or Regulatory 

Information Number (RIN) for this 

rulemaking. Because paper mail in the 

Washington, DC, area and at the Bureau 

is subject to delay, and in light of 

difficulties associated with mail and 

hand deliveries during the COVID–19 

pandemic, commenters are encouraged 

to submit comments electronically. In 

general, all comments received will be 

posted without change to https://

www.regulations.gov. In addition, once 

the Bureau’s headquarters reopens, 

comments will be available for public 

inspection and copying at 1700 G Street 

NW, Washington, DC 20552, on official 

business days between the hours of 10 

a.m. and 5 p.m. Eastern Time. You can 

make an appointment to inspect the 

documents by telephoning 202–435– 

7275. 

All comments, including attachments 

and other supporting materials, will 

become part of the public record and 

subject to public disclosure. Proprietary 

information or sensitive personal 

information, such as account numbers 

or Social Security numbers, or names of 

other individuals, should not be 

included. Comments will not be edited 

to remove any identifying or contact 

information. 

FOR FURTHER INFORMATION CONTACT: Ben 

Cady, Mark Morelli, Amanda Quester, 

or Priscilla Walton-Fein, Senior 

Counsels, Office of Regulations, at 202– 

435–7700. If you require this document 

in an alternative electronic format, 

please contact CFPB_Accessibility@

cfpb.gov. 


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