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[Federal Register Volume 76, Number 114 (Tuesday, June 14, 2011)]
[Proposed Rules]
[Pages 34618-34625]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-14429]

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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 987

[Doc. No. AMS-FV-10-0025; FV10-987-1 PR]

Domestic Dates Produced or Packed in Riverside County, CA; 
Proposed Amendments to Marketing Order

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule.

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SUMMARY: Five amendments to Marketing Agreement and Order No.987 which 
regulates the handling of domestic dates produced or packed in 
Riverside County, California, were proposed by the California Date 
Administrative Committee (CDAC or committee), which is responsible for 
local administration of the order. These proposed amendments are 
intended to improve administration of and compliance with the order and 
reflect current industry practices.
    In addition to the committee's proposals, the Agricultural 
Marketing Service (AMS) proposes to further amend the order by 
providing for a continuance referendum every six years, and by 
establishing term limits of up to six consecutive years for committee 
members. These proposals would allow producers to indicate continued 
support for the order and provide all interested industry members the 
opportunity to serve on the committee.

DATES: Comments must be received by July 14, 2011.

ADDRESSES: Written comments should be submitted to the Docket Clerk, 
Marketing Order Administration Branch, Fruit and Vegetable Programs, 
AMS, USDA, 1400 Independence Avenue, SW., STOP 0237, Washington, DC 
20250-0237; Fax: (202) 720-8938; or Internet: http://www.regulations.gov. All comments should reference the document number 
and the date and page number of this issue of the Federal Register. All 
comments submitted in response to this proposed rule will be included 
in the record 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. 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.
    To the extent practicable, all documents filed with the Docket 
Clerk should also be submitted electronically to Laurel May at the e-
mail address noted for her in the FOR FURTHER INFORMATION CONTACT 
section.

FOR FURTHER INFORMATION CONTACT: Laurel May, Senior Marketing 
Specialist, or Kathleen Finn, Rulemaking Team Program Manager, 
Marketing Order Administration Branch, Fruit and Vegetable Programs, 
AMS, USDA; 1400 Independence Avenue, SW., Stop 0237, Washington, DC 
20250-0237; Telephone: (202) 720-2491, Fax: (202) 720-8938, or E-mail: 
Laurel.May@ams.usda.gov or Kathy.Finn@ams.usda.gov.
    Small businesses may request information on complying with this 
regulation by contacting Antoinette

[[Page 34619]]

Carter, Marketing Order Administration Branch, Fruit and Vegetable 
Programs, AMS, USDA, 1400 Independence Avenue, SW., STOP 0237, 
Washington, DC 20250-0237; Telephone: (202) 720-2491, Fax: (202) 720-
8938, or E-mail: Antoinette.Carter@ams.usda.gov.

SUPPLEMENTARY INFORMATION: This proposal is issued under Marketing 
Agreement and Order No. 987, both as amended (7 CFR part 987), 
regulating the handling of domestic dates produced or packed in 
Riverside County, California, hereinafter referred to as the ``order.'' 
The order is effective under the Agricultural Marketing Agreement Act 
of 1937, as amended (7 U.S.C. 601-674), hereinafter referred to as the 
``Act.'' The applicable rules of practice and procedure governing the 
formulation of marketing agreements and orders (7 CFR part 900) 
authorize amendment of the order through this informal rulemaking 
action. A producer referendum will be held in the future to determine 
support for the proposed order amendments, if the amendments are deemed 
appropriate.
    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. This rule is not intended to have retroactive effect.
    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.
    Section 1504 of the Food, Conservation, and Energy Act of 2008 
(2008 Farm Bill) (Pub. L. 110-246) made changes to section 18c(17) of 
the Act, which in turn required the addition of supplemental rules of 
practice to 7 CFR part 900 (73 FR 49307; August, 21, 2008). The 
additional supplemental rules of practice authorize the use of informal 
rulemaking (5 U.S.C. 553) to amend Federal fruit, vegetable, and nut 
marketing agreements and orders if certain criteria are met.
    AMS has considered the nature and complexity of the proposed 
amendments, the potential regulatory and economic impacts on affected 
entities, and other relevant matters, and has determined that amending 
the order as proposed by the committee could appropriately be 
accomplished through informal rulemaking. AMS will analyze any comments 
received on the amendments proposed in this rule, and if appropriate, 
AMS will conduct a producer referendum. If appropriate, a final rule 
will then be issued to effectuate the amendments favored by producers 
participating in the referendum.
    The proposed amendments were recommended by the committee following 
deliberations at public meetings on October 30, 2008; October 29, 2009; 
and February 25, 2010. The proposed amendments were first submitted to 
AMS on May 29, 2009. After further discussions with AMS, the committee 
submitted revised proposals to AMS on March 2, 2010.
    The committee's proposed amendments would: (1) Authorize the 
committee to recommend regulatory exemptions for certain date varieties 
if market conditions warrant such exemption. Currently the order only 
provides for exemptions for handlers who sell dates directly to 
consumers in limited market outlets; (2) Increase the terms of office 
for committee members and alternates from two to three years; (3) 
Authorize the committee to conduct business by means of telephone or 
video conference technologies. Currently all committee meetings must be 
assembled; (4) Authorize the committee to collect interest charges and 
late fees on delinquent assessment payments. Currently, the order does 
not provide authority for the collection of interest and late fees; and 
(5) Authorize the committee to build and maintain an operating reserve 
not to exceed the average of one year's average expenses. Currently, 
the committee is authorized to maintain an operating reserve not to 
exceed 50 percent of an average year's expenses.
    AMS further proposes to amend the order by: (1) Requiring that a 
producer referendum be conducted every six years to determine continued 
support for the order; and (2) establishing term limits of no longer 
than two consecutive terms of office or six consecutive years for 
committee members and alternates. Finally, AMS proposes to make 
conforming changes to the order as may be necessary to conform to any 
amendment to the order that may result from this rulemaking action.

Proposal Number 1--Regulatory Exemptions

    Section 987.5 of the order defines the date varieties that are 
regulated under the order. Regulated varieties are subject to the 
minimum grade, size, inspection, certification, volume control, 
interhandler transfer, container, reporting, and assessment 
requirements authorized under Sec. Sec.  987.39 through 987.51, 
Sec. Sec.  987.61 through 987.68, and Sec.  987.72 of the order.
    Currently, Sec.  987.5 lists four date varieties for regulation 
under the order, including the Deglet Noor, Zahidi, Halawy, and 
Khadrawy varieties. At the time the order was established, these four 
varieties were produced or handled in Riverside County in sufficient 
quantities to warrant regulation. At times, production of some 
varieties may decline to the point that the committee believes that the 
cost to handlers of inspecting and reporting those varieties outweighs 
the benefits of doing so. For instance, the committee reports that the 
cost of regulating two date varieties currently outweighs the benefit 
of doing so as very little assessment revenue is generated by the 
handling of those two varieties. In such cases, the committee believes 
it should have the authority to recommend regulatory exemption of those 
varieties until such time as it is again appropriate to regulate them.
    To address this issue, the committee proposed amending the order by 
temporarily suspending the varieties currently produced in minimal 
quantities from inclusion in Sec.  987.5--DATES. However, AMS believes 
that the committee would have greater flexibility if it were authorized 
to recommend regulatory exemptions for varieties produced, with the 
approval of the Secretary, through the informal rulemaking process. In 
this way, any future changes in production levels or other market 
considerations for any variety could be addressed through informal 
rulemaking.
    Section 987.52 authorizes the committee to exempt handlers of dates 
for sale in certain market outlets from regulation if those sales are 
unlikely to interfere with the objectives of the order. However, the 
section does not authorize the exemption of dates sold into regular 
markets by variety. Such authority would allow the committee to 
recommend, subject to approval of the Secretary, that certain varieties 
be exempted from the order's regulations through informal rulemaking. 
Such authority should be broad enough to include exemptions for a 
variety of

[[Page 34620]]

reasons, including periods of minimal production. This flexibility 
would allow the committee to respond to changes in the production and 
marketing environment in a timely manner. As production and market 
conditions change, the committee could recommend lifting the regulatory 
exemptions, as appropriate.
    For example, two varieties regulated under the order are currently 
being produced in very small quantities. New date garden plantings of 
those varieties are still immature, and have not reached full 
production. Under the proposed amendment, the committee could 
recommend, through the informal rulemaking process, that those two 
varieties be exempted from the order's regulations. When the trees of 
each variety mature and are producing in sufficient quantities to 
warrant regulation, the committee could recommend that the variety-
specific exemptions be removed.
    For the reasons stated above, it is proposed that Sec.  987.52, 
Exemption, be amended by designating the current text of that section 
as paragraph (a) and adding a new paragraph (b) providing authority for 
the committee to recommend that any variety may be exempt from 
regulations established pursuant to Sec. Sec.  987.39 through 987.50, 
Sec. Sec.  987.61 through 987.68, and Sec.  987.72.

Proposal Number 2--Terms of Office

    Section 987.23 of the order specifies that the terms of office for 
committee members and alternates are two years, beginning on August 1. 
Section 987.24 of the order specifies that nominations for committee 
positions are held by June 15, every other year. The committee proposed 
amending the order to extend member and alternate terms of office from 
two to three years.
    The terms of office for another California date industry program, 
the California Date Commission (commission), are three years. Some 
committee members may also serve on the commission. Nominations for the 
two programs occasionally, but not always, take place within a few 
weeks of each other. Because nominations coincide in some years and 
don't coincide in others, the committee believes that voters can become 
confused about whether or not they have submitted ballots, and thus are 
less likely to participate in the committee's nomination process. The 
committee believes that extending terms of office to three years and 
synchronizing nominations with those of the commission would improve 
the nomination process and encourage greater participation in committee 
nominations.
    Additionally, the number of date producers and handlers in the 
production area has declined over time, making it increasingly 
difficult to find new candidates to serve as members and alternates on 
the nine-member committee every other year. The committee believes that 
extending the terms of office for one year would give the industry more 
time to identify and recruit potential new committee members between 
nomination periods.
    The current committee was nominated in 2010 and is expected to 
serve until 2012. If this amendment is adopted, terms of office of the 
current committee members and alternates would be extended until 2014, 
or whenever a new committee is selected by the Secretary. Thereafter, 
the three-year terms of office would commence with the new committee 
selected in 2014. This would coincide with the commission's nomination 
cycle.
    For the reasons stated above, it is proposed that Sec.  987.23 of 
the order be amended to change committee member and alternate terms of 
office from two to three years. The section should also specify that 
the terms of office of members and alternates serving at the time the 
amendment is effectuated would end on July 31, 2014. Further, Section 
987.24 should be amended to specify that nominations for committee 
positions are held by June 15 of every third year rather than every 
other year.

Proposal Number 3--Committee Meetings

    Section 987.31 of the order specifies procedures for conducting 
committee business. Quorum requirements are defined, and the minimum 
voting requirements for various matters are specified. The section 
specifies that votes cast at assembled meetings shall be cast in 
person. The section also authorizes the committee to vote on any 
proposition by mail, telephone, or telegram after all members and 
alternates acting as members have received identical explanations about 
the proposition. Telephone votes must be confirmed in writing within 
two weeks. Actions approved by mail, telephone, or telegram voting must 
be unanimous to be valid.
    Currently, the order does not authorize the committee to conduct 
business meetings by telephone or other means of modern communication 
technology, such as video conference. The committee proposed amending 
the order to authorize the use of such technology in certain 
situations.
    The use of telephone conference and video conference capability has 
become standard in the date industry, as well as in other marketing 
order programs. Use of such technology allows producers and handlers to 
address urgent committee business with minimal disruption to their 
individual business responsibilities. Telephone and video conferences 
also bolster participation by other interested parties who would 
otherwise be unable to participate in industry meetings due to the 
constraints of time and distance.
    The committee believes that the use of telephone and video 
conference technology would be appropriate in certain situations, such 
as when the matters to be discussed are minor, or when emergencies 
demand immediate decisions by the committee. The committee also 
believes that some business matters should be addressed at assembled 
meetings, and that alternate meeting formats would not be appropriate 
for all situations. The committee proposed that the chairperson should 
have the discretion to determine the appropriate format for any 
committee meeting.
    There could be some situations in which the chairperson determines 
that members may participate in assembled meetings by telephone or 
other means of communication. Although the member's alternate may be 
present at the same assembled meeting, the committee believes that the 
member should retain the right to vote on any issue that comes before 
the committee in that meeting, even if he or she is participating via 
telephone or videoconference. Therefore, the requirement that votes at 
assembled meetings shall be cast in person should be removed. 
Nevertheless, the committee believes that votes cast by telephone 
should continue to be confirmed in writing within two weeks of the 
meeting. Finally, because telegrams are no longer in standard use, 
authority to vote by telegram should be removed.
    For the reasons stated above, it is proposed that Sec.  987.31, 
Procedure, be amended by: Revising paragraph (d) to provide for 
participation in assembled committee meetings as well as telephone, 
video conference, or other types of meetings; providing the committee 
chairperson with discretion to determine the appropriate meeting format 
and whether members may participate in assembled meetings by telephone 
or other means; clarifying that members attending assembled meetings by 
alternate means of communication retain the same voting privileges they 
would otherwise have; and removing the requirement that votes at 
assembled

[[Page 34621]]

meetings shall be cast in person. Paragraph (e) of Sec.  987.31 would 
be amended by removing the words ``or telegram.''

Proposal Number 4--Interest and Late Payment Charges

    Section 987.72 requires date handlers to pay the committee 
assessments upon merchantable and utility dates they have certified as 
such. Funds to administer the order are derived from such assessments. 
The committee, with USDA approval, formulates annual budgets of 
expenses and recommends appropriate assessment rates. The committee's 
budgeted expenditures include those for general administration of the 
program, as well as the cost of promotional programs and marketing and 
media consultants.
    Currently, the order does not authorize the committee to charge 
interest or late payment charges for delinquent assessment payments. 
The committee believes that adding such authority would provide greater 
incentive for handlers to make assessment payments on time. This in 
turn would help ensure that the committee is able to meet its financial 
obligations and continue to fund its programs on a continuing basis.
    Charging interest and late payment charges on unpaid financial 
obligations is commonplace in the business world, and implementation of 
such charges would bring the committee's financial operations in line 
with standard business practices. Such charges would remove any 
financial advantage for those who do not pay on time while they benefit 
from committee programs, creating a more level playing field for the 
industry.
    The committee recommended amending the order to authorize the 
collection of interest and late payment charges for delinquent 
payments. Such authority would allow the committee to establish, 
through informal rulemaking, parameters for implementation, including 
timeframes and appropriate interest and late payment charges that would 
be imposed if necessary. This authority is intended to strengthen 
compliance with the order's assessment requirements.
    For the reasons stated above, it is proposed that paragraphs (b) 
through (d) of Sec.  987.72 be redesignated paragraphs (c) through (e), 
respectively, and that a new paragraph (b) be added to the order to 
specify that any assessment not paid by a handler within a period of 
time specified by the committee may be subject to an interest or late 
payment charge, or both. The new paragraph would further specify that 
the period of time, interest rate, and late payment charge shall be as 
recommended by the committee and approved by the Secretary.

Proposal Number 5--Operating Reserve

    Paragraph (c) of Sec.  987.72 currently authorizes the committee to 
establish and maintain a monetary operating reserve in an amount not to 
exceed 50 percent of an average year's expenses. The average year's 
expenses are calculated using the actual expenses of the five most 
recent crop years. Should the existing reserve ever exceed the 
recalculated average, there is no requirement to lower the reserve to 
meet that average. Funds in the reserve are available for use by the 
committee to meet its financial obligations in connection with 
administration of the order and its programs. Annual budgets and 
assessment rates are revised as appropriate in an effort to maintain 
the authorized operating reserve balance.
    The committee occasionally uses reserve funds when the assessment 
revenues they have collected are not sufficient to meet their budgeted 
expenses. This may happen when the date crop is smaller than expected, 
which reduces the total amount of assessments paid by handlers. In 
other instances, the committee may desire later in the year to take 
advantage of a promotional opportunity for which it had not budgeted at 
the beginning of the year. With the approval of the Secretary, the 
committee could revise their budget to include the promotional program 
and use reserve funds to cover its costs without increasing the current 
assessment rate.
    In crop years with unexpectedly high production, the approved 
assessment rate may generate excess funds. Under the order's current 
provisions, the committee is only authorized to retain an amount not to 
exceed 50 percent of an average year's expenses. Any excess funds must 
be returned to handlers or applied as a credit against their accounts 
for the upcoming year.
    The committee proposed raising the operating reserve limit from 50 
percent of an average year's expenses to an amount not to exceed one 
year's average expenses. This would allow the committee to retain more 
surplus assessment revenues they may collect. A larger operating 
reserve would strengthen the committee's continuity and confidence in 
managing committee business. A larger reserve would provide sufficient 
funds to meet the committee's budgeted financial obligations, including 
the maintenance of strategic marketing programs, in short crop years as 
well as provide the flexibility to respond to unexpected opportunities. 
The committee could recommend annual assessment rates. Over a number of 
years, the reserve could gradually increase until the balance 
approximates one year's average expenses, as calculated using the five 
most recent years' actual expenses.
    For the reasons stated above, it is proposed that paragraph (c) of 
Sec.  987.72, which would be redesignated paragraph (d) as described 
under amendment Proposal Number 4 above, be further amended to 
authorize the committee to build and maintain an operating monetary 
reserve not to exceed one year's average expenses, based upon the 
actual expenses of the five most recent crop years.

Proposal Number 6--Continuance Referenda

    AMS proposes to amend the order by adding a provision for 
continuance referenda every six years. Provision for periodic 
continuance referenda would offer producers the opportunity to indicate 
ongoing support for the order and its programs. Experience has shown 
that marketing order programs need significant industry support to 
operate effectively. Continuance of the date order would require the 
favorable vote of at least two-thirds of those voting, or of those 
representing at least two-thirds of the production volume represented 
in the referendum. This is the same support that is typically required 
for issuance or amendment of an order.
    The order was last amended on February 1, 1978 (43 FR 4253). Since 
that time, USDA has recommended that producers of commodities regulated 
under Federal marketing orders be offered the opportunity to 
participate in periodic continuance referenda. The California date 
marketing order does not currently provide for continuance referenda. 
Therefore, it is recommended that Sec.  987.82--Effective time, 
suspension, or termination, be amended by redesignating paragraph 
(b)(3) as paragraph (b)(4) and adding a new paragraph (b)(3) to provide 
that a continuance referendum shall be conducted six years after the 
amendment becomes effective and every six years thereafter. The new 
paragraph (b)(3) of Sec.  987.82 should further specify that 
continuation of the order would require the approval of two-thirds of 
the producers participating in the referendum, or of voters 
representing two-thirds of the date production represented in the 
referendum.
    In paragraph (b)(2) of Sec.  987.82, the word ``growers,'' which 
appears in the heading and in the text of that paragraph, should be 
replaced with the

[[Page 34622]]

word ``producers'' to conform with the definition provided in Sec.  
987.7 of the order; and the word ``he,'' in reference to the Secretary, 
should be replaced by the words ``he or she'' to modernize the section.

Proposal Number 7--Term Limits

    AMS proposes to amend the order by establishing term limits on the 
number of consecutive terms a person may serve on the committee.
    Currently, the term of office for each member and alternate member 
of the committee is two years. Committee members and alternates 
continue to serve until their successors have been selected by the 
Secretary and have qualified. The order does not specify any term 
limits for members or alternates. Members and alternates may be 
selected to serve consecutive terms in those positions, as long as they 
continue to be eligible and willing to do so.
    As explained under Proposal number 2 above, the committee has 
proposed to amend the order to provide for three-year terms of office. 
AMS's is proposing to further amend the order to specify that members 
may serve up to two consecutive three-year terms, not to exceed six 
consecutive years. This proposal for a limitation on tenure would not 
apply to alternates. Once a member has served on the committee for two 
consecutive terms, or six years, the member would be required to step 
down for at least one year before being eligible to serve as a member 
again. The member could serve as an alternate during that time.
    AMS's experience with similar marketing programs is that 
establishing tenure limits is a means to increase industry 
participation on the committee and in its programs. By inviting 
potential new members to serve, small and large entities who have not 
been actively involved previously may be encouraged to take part in the 
order's activities and gain committee experience.
    For the reasons stated above, it is proposed that Sec.  987.23 be 
further amended by specifying that members may serve up to two 
consecutive three-year terms, not to exceed six consecutive years as 
members. There would be no such limitation for alternates. After 
serving for six consecutive years, members would be required to step 
down for at least one year before being eligible to serve again. If the 
order is amended to allow three-year terms of office, members who were 
appointed in 2010 and continued to serve until 2014 would be allowed to 
serve one additional three-year term of office before being required to 
step down. Any other service prior to the order amendment would not 
count toward the term limit.

Conforming Changes to Administrative Rules and Regulations

    Adoption of two of the proposed amendments to the order would 
require that conforming changes be made to Sec.  987.124 of the order's 
administrative rules and regulations. These changes would not be voted 
upon by producers in the referendum, but would be made as conforming 
changes if Proposal Number 2, to make terms of office three years long, 
and/or Proposal Number 7, to add term limits, are approved by voters 
participating in the referendum.
    Currently, paragraph (a) of Sec.  987.124 specifies that 
nominations materials are provided to producers and producer-handlers 
no later than June 15 of each even numbered year. If the order is 
amended to provide for three year terms of office as explained in 
Proposal number 2 above, nominations would be conducted every three 
years, rather than every two years. Therefore, Sec.  987.124(a) should 
be changed to specify that ballot materials are provided to producers 
and producer handlers no later than June 15 of every third year.
    Paragraph (a)(1) of Sec.  987.124 currently specifies that the 
ballots should contain the list of incumbents who are willing to 
continue to serve on the committee. As explained above, some incumbents 
may no longer be eligible to serve in their positions if the proposal 
to add term limits is adopted. Therefore, Sec.  987.124(a)(1) should be 
revised to clarify that the names of incumbents who are both willing 
and eligible to continue serving should be listed on the ballots.

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 85 producers of dates in the production 
area and 8 handlers subject to regulation under the marketing order. 
The Small Business Administration (13 CFR 121.201) defines small 
agricultural producers as those having annual receipts of less than 
$750,000, and small agricultural service firms are defined as those 
having annual receipts of less than $7,000,000.
    According to the National Agricultural Statistics Service (NASS), 
the 2010 crop yield was approximately 7,080 pounds, or 3.54 tons, of 
dates per acre. NASS estimates that the 2010 grower price was 
approximately $0.585 per pound, or $1,170 per ton. Thus, the value of 
date production in 2010 averaged about $4,142 per acre (7,080 pounds 
per acre times $0.585 per pound). At that average price, a producer 
would have to farm over 181 acres to receive an annual income from 
dates of $750,000 ($750,000 divided by $4,142 per acre equals 181.1 
acres). According to committee staff, the majority of California date 
producers farm fewer than 181 acres. Thus, it can be concluded that the 
majority of date producers could be considered small entities. 
According to data from the committee, the majority of handlers of 
California dates may also be considered small entities.
    The amendments proposed by the committee would authorize the 
committee to recommend regulatory exemptions for dates by variety, 
provide for three years terms of office for committee members, provide 
for committee meetings by telephone and other means of communication, 
authorize an operating monetary reserve not to exceed one year's 
average expenses, and authorize the collection of interest and late 
payment charges on delinquent assessment payments.
    Amendments proposed by AMS would provide for continuance referenda 
every six years, and would specify term limits of not more than six 
consecutive years for committee positions. Conforming changes to the 
order's administrative rules and regulations would be made as necessary 
to facilitate implementation of any amendments approved by voters in 
the referendum. Specifically, the committee's nomination and polling 
procedures would be modified to require that balloting materials be 
provided to producers by June 15 of every third year.
    The committee's proposed amendments were unanimously recommended at 
public meetings held on October 30, 2008; October 29, 2009; and 
February 25, 2010. The committee believes that each of their proposed 
amendments would benefit producers and handlers of all sizes.

[[Page 34623]]

    If granted authority to temporarily exempt certain date varieties 
from regulation, the committee could determine whether the costs of 
collecting assessments and reports on individual varieties are 
warranted. Handler burden related to those functions would be reduced 
for exempted varieties. Decreases in handler assessment obligation and 
reporting costs could be passed on to producers. Administrative costs 
related to enforcing regulatory compliance for those varieties would 
also be reduced.
    Producer and handler participation in committee nominations is 
expected to improve if member terms of office are extended from two to 
three years. Extending the terms of office would afford the committee 
more time to identify and develop potential new members between 
committee selections. Coordinating committee nomination periods with 
those of other industry programs is expected to reduce voter confusion 
and increase the number of ballots returned, thus improving producer 
and handler representation on the committee.
    Adding authority for alternative meeting formats is expected to 
improve participation in committee deliberations by industry members of 
all sizes. Such authority would minimize the time that committee 
members would be required to be away from their individual businesses. 
Authorizing the chairperson to determine the format for each meeting 
would ensure that critical committee business is addressed 
appropriately. By providing greater flexibility for meeting attendance 
and participation, the committee hopes to benefit from the input of a 
greater number of interested persons whose perspectives and ideas could 
improve the marketing of California dates, which would in turn benefit 
both producers and handlers.
    Authorizing the committee to impose interest and late payment 
charges on delinquent assessments is intended to encourage handlers to 
make payments on a timely basis. There would be no additional cost to 
handlers who comply with the order's assessment requirements. Timely 
assessment payments allow the committee to make and keep financial 
obligations with regard to operation of its programs, including 
marketing and promotion, which are intended to benefit all producers 
and handlers.
    If authority to build and maintain an operating reserve equal to 
one year's average expenses is added to the order, the committee could 
recommend increases to their assessment rate in order to gradually 
build the reserve. During high production years, excess assessments 
could be added to the reserve until the fund's limit is reached. The 
larger operating reserve would help ensure that the committee has 
sufficient funds to meet its financial obligations and maintain 
critical marketing programs, even during short crop years. Such 
stability is expected to allow the committee to conduct programs that 
will benefit all entities, regardless of size.
    AMS's proposal to add provision for continuance referenda is 
expected to afford producers the opportunity to indicate ongoing 
support for the order and its programs. The proposal to add term limits 
is expected to encourage participation on the committee by all 
interested industry members. Support for the program, and active 
participation on the committee by a diverse group of industry members, 
are expected to benefit all producers and handlers by ensuring that the 
program continues to meet the industry's evolving needs.
    Proposed changes to the order's nomination and polling regulations 
are administrative in nature and are intended to facilitate 
implementation of the proposed amendments, if adopted.
    Where measurable, the costs outlined in this analysis are expected 
to be proportional to the size of business, so smaller businesses 
should not be unduly burdened. Benefits associated with improved 
efficiencies and greater representation on the committee should accrue 
to all entities, regardless of size.
    Alternatives to these proposals include making no changes at this 
time. However, the proposed changes are necessary to update 
administration of the order to reflect current industry practices, 
provide consistent funding that will enable the committee to maintain 
valuable marketing programs, and provide greater opportunity for 
committee participation.
    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. 0581-0178, Vegetable and Specialty Crops. No changes 
in those requirements as a result of this proceeding are anticipated. 
Should any changes become necessary, they would be submitted to OMB for 
approval.
    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.
    In addition, USDA has not identified any relevant Federal rules 
that duplicate, overlap, or conflict with this rule.
    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.
    The committee's meetings, at which these proposals were discussed, 
were widely publicized throughout the date industry. All interested 
persons were invited to attend the meetings and encouraged to 
participate in committee deliberations on all issues. Like all 
committee meetings, the meetings were public, and all entities, both 
large and small, were encouraged to express their views on these 
proposals.
    Finally, interested persons are invited to submit comments on the 
proposed amendments to the order as well as on the proposed revisions 
to the administrative rules and regulations that would be made if the 
amendments are adopted, including comments on the regulatory and 
informational impacts of this action on small businesses.
    Following analysis of any comments received on the amendments 
proposed in this rule, AMS would conduct a producer referendum, if 
appropriate. Information about the referendum, including dates and 
voter eligibility requirements, would be published in a future issue of 
the Federal Register. If appropriate, a final rule would then be issued 
to effectuate the amendments favored by producers participating in the 
referendum and to finalize any conforming changes necessary to reflect 
amendments to the order.
    A small business guide on complying with fruit, vegetable, and 
specialty crop marketing agreements and orders may be viewed at: http://www.ams.usda.gov/MarketingOrdersSmallBusinessGuide. Any questions 
about the compliance guide should be sent to Antoinette Carter at the 
previously mentioned address in the FOR FURTHER INFORMATION CONTACT 
section.

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.

[[Page 34624]]

    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 dates produced 
or packed in the production area (Riverside County, California) 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;
    3. The marketing agreement and order, as amended, and as hereby 
proposed to be further amended, is limited in its 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, prescribes, 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 dates produced or packed in the production 
area; and
    5. All handling of dates produced or packed 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.
    A 30-day comment period is provided to allow interested persons to 
respond to these proposals. Thirty days is deemed appropriate because 
the proposed changes have been widely publicized, and implementation of 
the changes, if adopted, would be desirable to benefit the industry as 
soon as possible. All written comments timely received will be 
considered, and a grower referendum will be conducted before any of the 
proposed amendments are implemented.

List of Subjects in 7 CFR Part 987

    Dates, Marketing agreements, Reporting and recordkeeping 
requirements.

    For the reasons set forth in the preamble, 7 CFR part 987 is 
proposed to be amended as follows:

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

    1. The authority citation for 7 CFR part 987 continues to read as 
follows:

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

    2. Revise Sec.  987.23 to read as follows:

Sec.  987.23  Term of office.

    The term of office for members and alternate members shall be three 
years beginning August 1, except that such term may be shorter if the 
Committee composition is changed in the interim pursuant to Sec.  
987.21. Provided, That the terms of office of all members and 
alternates currently serving at the time of the amendment will end on 
July 31, 2014. Commencing with the term of office that begins on August 
1, 2014, members may serve up to two consecutive three-year terms, not 
to exceed six consecutive years as members: Provided, That members who 
were serving at the time of the amendment and who continued to serve 
until 2014 may serve only one additional three-year term of office. 
Members who have served two consecutive terms or six years may not 
serve as members for at least one year before becoming eligible to 
serve again. Except as provided above, the limitation on consecutive 
terms of office and years of service does not apply to service on the 
committee prior to enactment of the amendment, and does not apply to 
alternates. Each member and alternate member shall, unless otherwise 
ordered by the Secretary, continue to serve until his or her successor 
has been selected and has qualified.
    3. Revise paragraph (a) of Sec.  987.24 to read as follows:

Sec.  987.24  Nomination and selection.

    (a) Nomination for members and alternate members of the Committee 
shall be made not later than June 15 of every third year.
* * * * *
    4. Amend Sec.  987.31 by revising paragraphs (d) and (e) to read as 
follows:

Sec.  987.31  [Amended]

* * * * *
    (d) At the discretion of the chairperson, Committee meetings may be 
assembled or conducted by means of teleconference, video conference, or 
other means of communication that may be developed. Assembled meetings 
may also allow for participation by means of teleconference or video 
conference or other communication methods, at the discretion of the 
chair. Members participating in meetings via any of these alternative 
means retain the same voting privileges that they would otherwise have.
    (e) The Committee may vote upon any proposition by mail, or by 
telephone when confirmed in writing within two weeks, upon due notice 
and full and identical explanation to all members, including alternates 
acting as members, but any such action shall not be considered valid 
unless unanimously approved.
* * * * *
    5. Amend Sec.  987.52 by designating the existing text as paragraph 
(a) and by adding a new paragraph (b) to read as follows:

Sec.  987.52  [Amended]

    (a) * * *
    (b) The Committee may, with the approval of the Secretary, 
recommend that the handling of any date variety be exempted from 
regulations established pursuant to Sec. Sec.  987.39 through 987.51 
and Sec. Sec.  987.61 through 987.72.
    6. Amend Sec.  987.72 by redesignating paragraphs (b) through (d) 
as paragraphs (c) through (e), respectively; by adding a new paragraph 
(b); and by revising redesignated paragraph (d) to read as follows:

Sec.  987.72  [Amended]

* * * * *
    (b) Delinquent payments. Any assessment not paid by a handler 
within a period of time prescribed by the Committee may be subject to 
an interest or late payment charge, or both. The period of time, rate 
of interest, and late payment charge shall be as recommended by the 
Committee and approved by the Secretary.
    (c) * * *
    (d) Operating reserve. The Committee, with the approval of the 
Secretary, may establish and maintain during one or more crop years an 
operating monetary reserve in an amount not to exceed the average of 
one year's expenses incurred during the most recent five preceding crop 
years, except that an established reserve need not be reduced to 
conform to any recomputed average. Funds in reserve shall be available 
for use by the Committee for expenses authorized pursuant to Sec.  
987.71.
* * * * *
    7. Amend Sec.  987.82 by revising paragraph (b)(2), redesignating 
paragraph (b)(3) as paragraph (b)(4), and adding a new paragraph (b)(3) 
to read as follows:

Sec.  987.82  [Amended]

* * * * *
    (b) * * *
    (2) When favored by producers. The Secretary shall terminate the 
provisions

[[Page 34625]]

of this part at the end of any crop year whenever he or she finds that 
such termination is favored by a majority of the producers of dates 
who, during that crop year, have been engaged in the production for 
market of dates in the area of production: Provided, That such majority 
have, during such period, produced for market more than 50 percent of 
the volume of such dates produced for market within said area; but such 
termination shall be effective only if announced on or before August 1 
of the then current crop year.
    (3) Continuance referendum. 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 part is 
favored by producers. The Secretary may terminate the provisions of 
this part at the end of any crop year in which he or she has found that 
continuance of this part is not favored by producers who, during a 
representative period determined by the Secretary, have been engaged in 
the production for market of dates in the production area.
* * * * *
    8. Revise Sec.  987.124(a) to read as follows:

Sec.  987.124  Nomination and polling.

    (a) Date producers and producer-handlers shall be provided an 
opportunity to nominate and vote for individuals to serve on the 
Committee. For this purpose, the Committee shall, no later than June 15 
of every third year, provide date producers and producer-handlers 
nomination and balloting material by mail or equivalent electronic 
means, upon which producers and producer-handlers may nominate 
candidates and cast their votes for members and alternate members of 
the Committee in accordance with the requirements in paragraphs (b)(1) 
and (b)(2) of this section, respectively. All ballots are subject to 
verification. Balloting material should be provided to voters at least 
two weeks before the due date and should contain, at least, the 
following information:
    (1) The names of incumbents who are willing and eligible to 
continue to serve on the Committee;
    (2) The names of other persons willing and eligible to serve;
    (3) Instructions on how voters may add write-in candidates;
    (4) The date on which the ballot is due to the Committee or its 
agent; and
    (5) How and where to return ballots.

    Dated: June 6, 2011.
Ellen King,
Acting Administrator, Agricultural Marketing Service.
[FR Doc. 2011-14429 Filed 6-13-11; 8:45 am]
BILLING CODE 3410-02-P
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