This section of the FEDERAL REGISTER

contains regulatory documents having general

applicability and legal effect, most of which

are keyed to and codified in the Code of

Federal Regulations, which is published under

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REGISTER issue of each week.

Rules and Regulations Federal Register

66643 

Vol. 71, No. 221 

Thursday, November 16, 2006 

DEPARTMENT OF AGRICULTURE 

Agricultural Marketing Service 

7 CFR Part 983 

[Docket No. FV06–983–3 FR] 

Pistachios Grown in California; 

Decreased Assessment Rate 

AGENCY: Agricultural Marketing Service, 

USDA. 

ACTION: Final rule. 

SUMMARY: This rule decreases the 

assessment rate established for the 

Administrative Committee for 

Pistachios (committee) for the 2006–07 

and subsequent production years from 

$0.0014 to $0.0007 per pound of 

assessed-weight pistachios. The 

committee, which locally administers 

the marketing order regulating the 

handling of pistachios grown in 

California (order), made this 

recommendation to help reduce the 

monetary reserve and ensure that it 

remains at a level consistent with order 

requirements. Assessments upon 

pistachio handlers are used by the 

committee to fund reasonable and 

necessary expenses of the program. The 

production year begins September 1 and 

ends August 31. The assessment rate 

will remain in effect indefinitely unless 

modified, suspended, or terminated. 

EFFECTIVE DATE: November 17, 2006. 

FOR FURTHER INFORMATION CONTACT: 

Terry Vawter, Marketing Specialist, or 

Kurt J. Kimmel, Regional Manager, 

California Marketing Field Office, Fruit 

and Vegetable Programs, AMS, USDA, 

2202 Monterey Street, suite 102B, 

Fresno, California 93721; telephone: 

(559) 487–5901; Fax (559) 487–5906, or 

E-mail: Terry.Vawter@usda.gov or 

Kurt.Kimmel@usda.gov. 

Small businesses may request 

information on complying with this 

regulation by contacting Jay Guerber, 

Marketing Order Administration 

Branch, Fruit and Vegetable Programs, 

AMS, USDA, 1400 Independence 

Avenue, SW., STOP 0237, Washington, 

DC, 20250–0237; telephone: (202) 720– 

2491, Fax: (202) 720–8938, or E-mail: 

Jay.Guerber@usda.gov. 

SUPPLEMENTARY INFORMATION: This rule 

is issued under Marketing Agreement 

and Order No. 983, regulating the 

handling of pistachios grown in 

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 Department of Agriculture 

(USDA) is issuing this rule in 

conformance with Executive Order 

12866. 

This rule has been reviewed under 

Executive Order 12988, Civil Justice 

Reform. Under the marketing order now 

in effect, California pistachio handlers 

are subject to assessments. Funds to 

administer the order are derived from 

such assessments. It is intended that the 

assessment rate as issued herein will be 

applicable to all assessable pistachios 

beginning September 1, 2006, and 

continue until amended, suspended, or 

terminated. This rule will not preempt 

any State or local laws, regulations, or 

policies, unless they present an 

irreconcilable conflict with this rule. 

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 rule decreases the assessment 

rate established for the committee for 

the 2006–07 and subsequent production 

years from $0.0014 to $0.0007 per 

pound of assessed-weight pistachios. 

The assessment obligation for each 

handler is computed by applying the 

assessment rate to each handler’s 

assessed weight, computed pursuant to 

§ 983.6 of the order. 

Sections 983.52 and 983.53 of the 

order provide authority for the 

committee, with the approval of USDA, 

to formulate an annual budget of 

expenses and to collect assessments 

from handlers to administer the 

program. In addition, the order 

authorizes the use of a monetary reserve 

to cover program expenses (§ 983.56). 

The monetary reserve may not exceed 

approximately two production years’ 

budgeted expenses. That section also 

requires the committee to reduce future 

assessments so that the reserve funds 

are less than or equal to two production 

years’ budgeted expenses. 

The members of the committee are 

producers and handlers of California 

pistachios. They are familiar with the 

committee’s needs and with the costs 

for 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. Therefore, all directly affected 

persons have an opportunity to 

participate and provide input. 

For the 2004–05 production year, the 

committee recommended, and USDA 

approved, an assessment rate of $0.0014 

per pound of assessed-weight pistachios 

(§ 983.253). The assessment rate would 

continue in effect from production year 

to production year unless modified, 

suspended, or terminated by USDA 

upon recommendation and information 

submitted by the committee or other 

information available to USDA. 

The committee met on May 23, 2006, 

and unanimously recommended 2006– 

07 expenditures of $340,906 and an 

assessment rate of $0.0007 per pound of 

assessed-weight pistachios received for 

processing. By comparison, expenses for 

the 2005–06 production year totaled 

$324,403 and the assessment rate was 

$0.0014 per pound of assessed-weight 

pistachios received for processing. The 

$0.0007 assessment rate is one-half of 

the $0.0014 assessment rate. Reducing 

the assessment rate will help reduce the 

reserve and ensure that it remains at a 

level consistent with order 

requirements. 

The major expenditures 

recommended by the committee for the 


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66644 Federal Register / Vol. 71, No. 221 / Thursday, November 16, 2006 / Rules and Regulations 

2006–07 production year include: 

$80,952 for administrative expenses; 

$10,000 for compliance expenses; 

$149,954 for salaries; and $100,000 for 

a contingency reserve. In comparison, 

major expenditures for the 2005–06 

production year included: $85,046 for 

administrative expenses; $10,000 for 

compliance expenses; $129,357 for 

salaries; and $100,000 for a contingency 

reserve. 

The committee believes that 

maintaining the current assessment rate 

could eventually result in a financial 

reserve balance beyond order 

requirements that the reserve not exceed 

approximately two production years’

expenses. Based on this, the committee 

determined that decreasing the 

assessment rate at this time will help to 

reduce the monetary reserve and ensure 

the reserve is maintained at a level 

consistent with order requirements. 

The assessment rate recommended by 

the committee was derived by dividing 

anticipated expenses minus the reserve 

funds that will be utilized to meet 

expenses by expected receipts (the 

assessed weight) of California pistachios 

during the 2006–07 season ($340,906 

minus $200,906 divided by 200,000,000 

pounds = $0.0007 per pound). With 

pistachio receipts for the year estimated 

at 200,000,000 pounds, assessment 

income is expected to total $140,000. 

If the assessment rate remained at 

$0.0014 per pound (estimated $280,000 

assessment income), the estimated 

reserve on August 31, 2007, would be 

$448,741. Although this amount would 

still be within the order’s reserve 

requirements, the committee believes it 

should reduce the reserve in the event 

that some of the variable components, 

such as crop estimate, are understated. 

The assessment rate established in 

this rule will continue in effect 

indefinitely unless modified, 

suspended, or terminated by USDA 

upon recommendation and information 

submitted by the committee or other 

available information. 

Although this assessment rate will be 

in effect for an indefinite period, the 

committee will continue to meet prior to 

or during each production year to 

recommend a budget of expenses and 

consider recommendations for 

modification of the assessment rate. The 

dates and times of committee meetings 

are available from the committee or 

USDA. Committee meetings are open to 

the public and interested persons may 

express their views at these meetings. 

USDA will evaluate committee 

recommendations and other available 

information to determine whether 

modification of the assessment rate is 

needed. Further rulemaking will be 

undertaken as necessary. The 

committee’s 2006–07 budget and those 

for subsequent production years will be 

reviewed and, as appropriate, approved 

by USDA. 

Final Regulatory Flexibility Analysis 

Pursuant to requirements set forth in 

the Regulatory Flexibility Act (RFA), the 

Agricultural Marketing Service (AMS) 

has considered the economic impact of 

this rule on small entities. Accordingly, 

AMS has prepared this final 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 the rules issued thereunder, are 

unique in that they are brought about 

through group action of essentially 

small entities acting on their own 

behalf. Thus, both statutes have small 

entity orientation and compatibility. 

There are approximately 50 handlers 

of California pistachios subject to 

regulation under the order and 

approximately 740 producers in the 

production area. The Small Business 

Administration (13 CFR 121.201) 

defines small agricultural producers as 

those having annual receipts less than 

$750,000, and defines small agricultural 

service firms as those whose annual 

receipts are less than $6,500,000. Of the 

740 producers, approximately 722 have 

annual receipts of less than $750,000. 

Eight of the 50 handlers subject to 

regulation have annual pistachio 

receipts of at least $6,500,000. Thus, the 

majority of handlers and producers of 

California pistachios may be classified 

as small entities. 

This rule decreases the assessment 

rate established for the committee and 

collected from handlers for the 2006–07 

and subsequent production years from 

$0.0014 to $0.0007 per pound of 

assessed-weight pistachios received for 

processing. The committee unanimously 

recommended 2006–07 expenditures of 

$340,906 and an assessment rate of 

$0.0007 per pound of assessed-weight 

pistachios. The recommendation was 

made to reduce the monetary reserve to 

ensure that it remains at a level 

consistent with order requirements. The 

quantity of assessed-weight pistachios 

anticipated for the 2006–07 production 

year is estimated at 200,000,000 pounds. 

The total assessments collected are 

estimated to be $140,000. Assessment 

income coupled with funds on hand at 

the beginning of the production year of 

nearly $500,000 should provide the 

committee with adequate funds to meet 

its 2006–07 expenses and maintain an 

adequate reserve that is within the 

requirements of the order. 

The major expenditures 

recommended by the committee for the 

2006–07 production year include: 

$80,952 for administrative expenses; 

$10,000 for compliance expenses; 

$149,954 for salaries; and $100,000 for 

a contingency reserve. In comparison, 

major expenditures for the 2005–06 

production year included: $85,046 for 

administrative expenses; $10,000 for 

compliance expenses; $129,357 for 

salaries; and $100,000 for a contingency 

reserve. 

The assessment rate recommended by 

the committee was derived by dividing 

anticipated expenses minus the reserve 

funds that will be utilized to meet 

expenses by expected receipts (the 

assessed weight) of California pistachios 

during the 2006–07 season ($340,906 

minus $200,906 divided by 200,000,000 

pounds = $0.0007 per pound). With 

pistachio receipts for the year estimated 

at 200,000,000 pounds, assessment 

income is expected to total $140,000. 

If the assessment rate remained at 

$0.0014 per pound (estimated $280,000 

assessment income), the estimated 

reserve on August 31, 2007, would be 

$448,741. Although this amount would 

still be within the order’s reserve 

requirements, the committee believed it 

should reduce the reserve in the event 

that some of the variable components, 

such as crop estimate, are understated. 

At its meeting on May 23, 2006, the 

committee discussed the alternative 

levels of assessments it believed would 

provide both adequate funding of 

expenses and result in a reduced 

financial reserve. The committee also 

reviewed information from its Executive 

Subcommittee, which met on March 1, 

2006. Some committee members 

believed that the reserve funds alone 

would be adequate to sustain committee 

operations in the absence of any 

assessment rate. Others believed a 

smaller assessment rate was prudent, 

thus keeping consistent assessment 

collections from one production year to 

the next. That way, the committee 

reasoned, handlers would be in a better 

position to plan for assessments from 

year to year. After deliberating the value 

of both proposals, the committee 

ultimately unanimously recommended a 

reduced assessment rate of $0.0007 per 

pound of assessed-weight pistachios 

and expenses totaling $340,906. 

A review of historical information and 

preliminary information pertaining to 

the production year indicates that the 

grower price for the 2006–07 production 

year could range between $1.65 and 

$1.75 per pound of assessed-weight 

pistachios. Therefore, the estimated 


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Federal Register / Vol. 71, No. 221 / Thursday, November 16, 2006 / Rules and Regulations 66645 

assessment revenue for the 2006–07 

production year as a percentage of total 

grower revenue could range between 

.040 and .042 percent. 

While assessments impose some 

additional costs on handlers, the costs 

are minimal and uniform on all 

handlers. Some of the additional costs 

may be passed on to producers. 

However, decreasing the assessment rate 

will reduce the burden on handlers, and 

may reduce the burden on producers. In 

addition, the committee’s meeting was 

widely publicized throughout the 

California pistachio industry and all 

interested persons were invited to 

attend the meeting and encouraged to 

participate in committee deliberations 

on all issues. Like all committee 

meetings, the May 23, 2006, meeting 

was a public meeting and all entities, 

both large and small, were able to 

express views on this issue. 

This rule imposes no additional 

reporting and recordkeeping on either 

small or large pistachio 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. 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. 

A proposed rule concerning this 

action was published in the Federal 

Register on August 25, 2006 (71 FR 

50374). Copies of the proposed rule 

were also mailed or sent via facsimile to 

all pistachio handlers. Finally, the 

proposal was made available through 

the Internet by USDA and the Office of 

the Federal Register. A 30-day comment 

period ending September 25, 2006, was 

provided for interested persons to 

respond to the proposal. No comments 

were received. 

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/ 

fv/moab.html. Any questions about the 

compliance guide should be sent to Jay 

Guerber at the previously mentioned 

address in the FOR FURTHER INFORMATION

CONTACT section. 

After consideration of all relevant 

material presented, including the 

information and recommendation 

submitted by the committee and other 

available information, it is hereby found 

that this rule, as hereinafter set forth, 

will tend to effectuate the declared 

policy of the Act. 

Pursuant to 5 U.S.C. 553, it is also 

found and determined that good cause 

exists for not postponing the effective 

date of this rule until 30 days after 

publication in the Federal Register 

because the 2006–07 production year 

began on September 1, 2006, and 

pistachio handlers are already receiving 

2006–07 crop pistachios from growers. 

The decreased assessment rate applies 

to all pistachios received during the 

2006–07 year and subsequent seasons. 

Further, handlers are aware of this rule 

which was unanimously recommended 

at a public meeting. Also, a 30-day 

comment period was provided for in the 

proposed rule, and no comments were 

received. 

List of Subjects in 7 CFR Part 983 

Marketing agreements, Pistachios, 

Reporting and recordkeeping 

requirements. 

■ For the reasons set forth in the 

preamble, 7 CFR part 983 is amended as 

follows: 

PART 983—PISTACHIOS GROWN IN 

CALIFORNIA 

■ 1. The authority citation for 7 CFR 

part 983 continues to read as follows: 

Authority: 7 U.S.C. 601–674. 

■ 2. Section 983.253 is amended by 

revising paragraph (a) to read as follows: 

§ 983.253 Assessment rate. 

(a) On and after September 1, 2006, a 

continuing assessment rate of $0.0007 

per pound of assessed-weight pistachios 

is established for California pistachios. 

The assessment obligation of each 

handler shall be computed by applying 

the assessment rate to the assessed 

weight computed pursuant to § 983.6. 

* * * * * 

Dated: November 14, 2006. 

Lloyd C. Day, 

Administrator, Agricultural Marketing 

Service. 

[FR Doc. 06–9252 Filed 11–14–06; 1:09 pm] 

BILLING CODE 3410–02–P 

DEPARTMENT OF AGRICULTURE 

Agricultural Marketing Service 

7 CFR Part 984 

[Docket No. FV06–984–2 IFR] 

Walnuts Grown in California; Increased 

Assessment Rate 

AGENCY: Agricultural Marketing Service, 

USDA. 

ACTION: Interim final rule with request 

for comments. 

SUMMARY: This rule increases the 

assessment rate established for the 

Walnut Marketing Board (Board) for the 

2006–07 and subsequent marketing 

years from $0.0096 to $0.0101 per 

kernelweight pound of assessable 

walnuts. The Board locally administers 

the marketing order which regulates the 

handling of walnuts grown in 

California. Assessments upon walnut 

handlers are used by the Board to fund 

reasonable and necessary expenses of 

the program. The marketing year begins 

August 1 and ends July 31. The 

assessment rate will remain in effect 

indefinitely unless modified, 

suspended, or terminated. 

DATES: November 17, 2006. Comments 

received by January 16, 2007 will be 

considered prior to issuance of a final 

rule. 

ADDRESSES: Interested persons are 

invited to submit written comments 

concerning this rule. Comments must be 

sent 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, E-mail: 

moab.docketclerk@usda.gov, or Internet: 

http://www.regulations.gov. Comments 

should reference the docket 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.ams.usda.gov/fv/ 

moab.html. 

FOR FURTHER INFORMATION CONTACT: 

Shereen Marino, Marketing Specialist, 

or Kurt Kimmel, Regional Manager, 

California Marketing Field Office, 

Marketing Order Administration 

Branch, Fruit and Vegetable Programs, 

AMS, USDA; Telephone: (559) 487–

5901, Fax: (559) 487–5906, or E-mail: 

Shereen.Marino@usda.gov or 

Kurt.Kimmel@usda.gov. 

Small businesses may request 

information on complying with this 

regulation by contacting Jay Guerber, 


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