66702 Federal Register / Vol. 71, No. 221 / Thursday, November 16, 2006 / Proposed Rules 

to determine the amount of production to 

count.); or 

(B) If you elect to continue to care for the 

crop, the amount of production to count for 

the acreage will be the harvested production, 

or our reappraisal if additional damage 

occurs and the crop is not harvested; and 

(2) All harvested production from the 

insurable acreage. 

(3) Any other uninsurable mustard 

production that is delivered to fulfill the 

processor contract. 

(d) Mature mustard may be adjusted for 

excess moisture and quality deficiencies. If 

moisture adjustment is applicable, it will be 

made prior to any adjustment for quality. 

(1) Mustard production will be reduced by 

0.12 percent for each 0.1 percentage point of 

moisture in excess of 10.0 percent. We may 

obtain samples of the production to 

determine the moisture content. 

(2) Mustard production will be eligible for 

quality adjustment only if: 

(i) Deficiencies in quality result in the 

mustard not meeting the requirements for 

acceptance under the processor contract 

because of damaged seeds (excluding heat 

damage), or a musty, sour, or commercially 

objectionable foreign odor; or 

(ii) Substances or conditions are present 

that are identified by the Food and Drug 

Administration or other public health 

organizations of the United States as being 

injurious to human or animal health. 

(3) Quality will be a factor in determining 

your loss in mustard production only if: 

(i) The deficiencies, substances, or 

conditions specified in section 13(d)(2) 

resulted from a cause of loss specified in 

section 10 that occurs within the insurance 

period; 

(ii) The deficiencies, substances, or 

conditions specified in section 13(d)(2) result 

in a salvage price less than the base contract 

price; 

(iii) All determinations of these 

deficiencies, substances, or conditions 

specified in section 13(d)(2) are made using 

samples of the production obtained by us or 

by a disinterested third party approved by us; 

and 

(iv) The samples are analyzed by a grader 

in accordance with the Directive for 

Inspection of Mustard Seed, provided by the 

Federal Grain Inspection Service or such 

other directive or standards that may be 

issued by FCIC. 

(4) Mustard production that is eligible for 

quality adjustment, as specified in sections 

13(d)(2) and (3), will be reduced by 

multiplying the quality adjustment factors 

contained in the Special Provisions (or the 

quality adjustment factors determined by 

dividing the salvage price by the base 

contract price (not to exceed 1.000) if the 

quality adjustment factors are not contained 

in the Special Provisions) by the number of 

pounds remaining after any reduction due to 

excessive moisture (the moisture-adjusted 

gross pounds) of the damaged or conditioned 

production. 

(i) The salvage price will be determined at 

the earlier of the date such quality adjusted 

production is sold or the date of final 

inspection for the unit subject to the 

following conditions: 

(A) Discounts used to establish the salvage 

price will be limited to those that are usual, 

customary, and reasonable. 

(B) The salvage price will not include any 

reductions for: 

(1) Moisture content; 

(2) Damage due to uninsured causes; 

(3) Drying, handling, processing, or any 

other costs associated with normal 

harvesting, handling, and marketing of the 

mustard; except, if the salvage price can be 

increased by conditioning, we may reduce 

the salvage price, after the production has 

been conditioned, by the cost of conditioning 

but not lower than the salvage price before 

conditioning; and 

(ii) We may obtain salvage prices from any 

buyer of our choice. If we obtain salvage 

prices from one or more buyers located 

outside your local market area, we will 

reduce such price by the additional costs 

required to deliver the mustard to those 

buyers. 

(iii) Factors not associated with grading 

under the Directive for Inspection of Mustard 

Seed, provided by the Federal Grain 

Inspection Service or such other directive or 

standards that may be issued by FCIC 

including, but not limited to, protein and oil 

will not be considered. 

(e) Any production harvested from plants 

growing in the insured crop may be counted 

as production of the insured crop on an 

unadjusted weight basis. 

14. Late Planting 

In lieu of section 16(a) of the Basic 

Provisions, the production guarantee 

(per acre) for each acre planted to the 

insured crop during the late planting 

period will be reduced by 1 percent per 

day for each day planted after the final 

planting date, unless otherwise 

specified in the Special Provisions. 

15. Prevented Planting 

In addition to the provisions 

contained in section 17 of the Basic 

Provisions, your prevented planting 

coverage will be 60 percent of your 

production guarantee (per acre) for 

timely planted acreage. If you have 

limited or additional levels of coverage, 

as specified in 7 CFR part 400, subpart 

T, and pay an additional premium, you 

may increase your prevented planting 

coverage to the levels specified in the 

actuarial documents. 

Signed in Washington, DC, on November 7, 

2006. 

Eldon Gould, 

Manager, Federal Crop Insurance 

Corporation. 

[FR Doc. E6–19320 Filed 11–15–06; 8:45 am] 

BILLING CODE 3410–08–P 

DEPARTMENT OF AGRICULTURE 

Agricultural Marketing Service 

7 CFR Part 966 

[Docket No. FV06–966–2 PR] 

Tomatoes Grown in Florida; Increased 

Assessment Rate 

AGENCY: Agricultural Marketing Service, 

USDA. 

ACTION: Proposed rule. 

SUMMARY: This rule would increase the 

assessment rate established for the 

Florida Tomato Committee (Committee) 

for the 2006–07 and subsequent fiscal 

periods from $0.025 to $0.035 per 25- 

pound container or equivalent of 

tomatoes handled. The Committee 

locally administers the marketing order 

which regulates the handling of 

tomatoes grown in Florida. Assessments 

upon Florida tomato handlers are used 

by the Committee to fund reasonable 

and necessary expenses of the program. 

The fiscal period begins August 1 and 

ends July 31. The assessment rate would 

remain in effect indefinitely unless 

modified, suspended, or terminated. 

DATES: Comments must be received by 

December 1, 2006. 

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 

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: 

William G. Pimental, Marketing 

Specialist or Christian D. Nissen, 

Regional Manager, Southeast Marketing 

Field Office, Fruit and Vegetable 

Programs, AMS, USDA; Telephone: 

(863) 324–3375, Fax: (863) 325–8793, or 

E-mail: William.Pimental@usda.gov or 

Christian.Nissen@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–


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Federal Register / Vol. 71, No. 221 / Thursday, November 16, 2006 / Proposed Rules 66703 

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

Jay.Guerber@usda.gov. 

SUPPLEMENTARY INFORMATION: This rule 

is issued under Marketing Agreement 

No. 125 and Order No. 966, both as 

amended (7 CFR part 966), regulating 

the handling of tomatoes grown in 

Florida, 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, Florida tomato handlers are 

subject to assessments. Funds to 

administer the order are derived from 

such assessments. It is intended that the 

assessment rate as proposed herein 

would be applicable to all assessable 

tomatoes beginning on August 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 would increase the 

assessment rate established for the 

Committee for the 2006–07 and 

subsequent fiscal periods from $0.025 to 

$0.035 per 25-pound container or 

equivalent of tomatoes. 

The Florida tomato marketing order 

provides authority for the Committee, 

with the approval of USDA, to formulate 

an annual budget of expenses and 

collect assessments from handlers to 

administer the program. The members 

of the Committee are producers and 

handlers of Florida tomatoes. 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. Thus, all 

directly affected persons have an 

opportunity to participate and provide 

input. 

For the 2003–04 and subsequent fiscal 

periods, the Committee recommended, 

and USDA approved, an assessment rate 

that would continue in effect from fiscal 

period to fiscal period 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 August 22, 

2006, and unanimously recommended 

2006–07 expenditures of $2,193,700 and 

an assessment rate of $0.035 per 25- 

pound container or equivalent of 

tomatoes. In comparison, last year’s 

budgeted expenditures were $2,161,800. 

The assessment rate of $0.035 is $0.01 

higher than the rate currently in effect. 

The increase in the assessment rate is 

needed to continue to support the 

increased budget for advertising and 

promotion started last season, while 

reducing the amount of funds drawn 

from the Committee’s authorized 

reserve. Without the increase in the 

assessment rate, the Committee would 

need to utilize an additional $500,000 

from the authorized reserve. 

The major expenditures 

recommended by the Committee for the 

2006–07 fiscal period include 

$1,000,000 for education and 

promotions, $445,900 for salaries, 

$320,000 for research, $67,000 for 

employee retirement, and $63,800 for 

employee health insurance. Budgeted 

expenses for these items in 2005–06 

were $1,000,000, $428,000, $320,000, 

$65,000 and $63,800, respectively. 

The assessment rate recommended by 

the Committee was derived by dividing 

anticipated expenses by expected 

shipments of Florida tomatoes. Tomato 

shipments for the year are estimated at 

50 million which should provide 

$1,750,000 in assessment income. 

Income derived from handler 

assessments, along with interest income 

and funds from the Committee’s 

authorized reserve, would be adequate 

to cover budgeted expenses. Funds in 

the reserve (currently around $700,000) 

would be kept within the maximum 

permitted by the order of not to exceed 

one fiscal period’s expenses as stated in 

§ 966.44. 

The proposed assessment rate would 

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 would 

be in effect for an indefinite period, the 

Committee would continue to meet 

prior to or during each fiscal period 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 would evaluate Committee 

recommendations and other available 

information to determine whether 

modification of the assessment rate is 

needed. Further rulemaking would be 

undertaken as necessary. The 

Committee’s 2006–07 budget and those 

for subsequent fiscal periods would be 

reviewed and, as appropriate, approved 

by USDA. 

Initial 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 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 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 100 

producers of tomatoes in the production 

area and approximately 70 handlers 

subject to regulation under the 

marketing order. Small agricultural 

producers are defined by the Small 

Business Administration (SBA) as those 

having annual receipts less than 

$750,000, and small agricultural service 

firms are defined as those whose annual 

receipts are less than $6,500,000 (13 

CFR 121.201). 

Based on industry and Committee 

data, the average annual price for fresh 

Florida tomatoes during the 2005–06 

season was approximately $10.27 per 

25-pound container or equivalent, and 

total fresh shipments for the 2005–06 

season were 47,880,303 25-pound 

equivalent cartons of tomatoes. 

Committee data indicates that 


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66704 Federal Register / Vol. 71, No. 221 / Thursday, November 16, 2006 / Proposed Rules 

approximately 25 percent of the 

handlers handle 94 percent of the total 

volume shipped outside the regulated 

area. Based on the average annual price 

of $10.27 per 25-pound container, about 

75 percent of handlers could be 

considered small businesses under 

SBA’s definition. In addition, based on 

production, grower prices as reported by 

the National Agricultural Statistics 

Service, and the total number of Florida 

tomato growers, the average annual 

grower revenue is below $750,000. 

Thus, the majority of handlers and 

producers of Florida tomatoes may be 

classified as small entities. 

This rule would increase the 

assessment rate established for the 

Committee and collected from handlers 

for the 2006–07 and subsequent fiscal 

periods from $0.025 to $0.035 per 25- 

pound container or equivalent of 

tomatoes. The Committee unanimously 

recommended 2006–07 expenditures of 

$2,193,700 and an assessment rate of 

$0.035 per pound container. The 

proposed assessment rate of $0.035 is 

$0.01 higher than the 2005–06 rate. The 

quantity of assessable tomatoes for the 

2006–07 season is estimated at 50 

million cartons. Thus, the $0.035 rate 

should provide $1,750,000 in 

assessment income. Income derived 

from handler assessments, along with 

interest income and funds from the 

Committee’s authorized reserve, would 

be adequate to cover budgeted expenses. 

The major expenditures 

recommended by the Committee for the 

2006–07 fiscal period include 

$1,000,000 for education and 

promotions, $445,900 for salaries, 

$320,000 for research, $67,000 for 

employee retirement, and $63,800 for 

employee health insurance. Budgeted 

expenses for these items in 2005–06 

were $1,000,000, $428,000, $320,000, 

$65,000, and $63,800, respectively. 

As previously mentioned, the number 

of assessable containers during 2006–07 

is estimated to be 50 million and the 

recommended assessment rate would 

generate $1,750,000 in income. The 

Committee’s financial reserve is now 

estimated to be $700,000 and is 

available to cover the deficit in 

assessment income. The increase in the 

assessment rate is needed to continue to 

support the increased budget for 

advertising and promotion started last 

season, while reducing the amount of 

funds drawn from the Committee’s 

authorized reserve. Without the increase 

in the assessment rate, the Committee 

would need to utilize an additional 

$500,000 from the authorized reserve. 

The Committee reviewed and 

unanimously recommended 2006–07 

expenditures of $2,193,700 which 

included increases in administrative 

and office salaries. Prior to arriving at 

this budget, the Committee considered 

information from various sources, such 

as the Committee’s Executive 

Subcommittee, Finance Subcommittee, 

Research Subcommittee, and Education 

and Promotion Subcommittee. 

Alternative expenditure levels were 

discussed by these groups, based upon 

the relative value of various research 

projects to the tomato industry. The 

assessment rate of $0.035 per 25-pound 

container of tomatoes was determined 

by examining the anticipated expenses 

and expected shipments and 

considering available reserves. The 

recommended assessment rate would 

generate $1,750,000 in income. 

Considering income from interest and 

other sources of $190,000, with 

assessments, total income would be 

approximately $253,700 below the 

anticipated expenses, which the 

Committee determined to be acceptable. 

A review of historical information and 

preliminary information pertaining to 

the upcoming season indicates that the 

grower price for the 2006–07 season 

could range between $8.27 and $12.95 

per 25-pound container or equivalent of 

tomatoes. Therefore, the estimated 

assessment revenue for the 2006–07 

season as a percentage of total grower 

revenue could range between 0.3 and 

0.4 percent. 

This action would increase the 

assessment obligation imposed on 

handlers. 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, these costs would be offset by 

the benefits derived by the operation of 

the marketing order. In addition, the 

Committee’s meeting was widely 

publicized throughout the Florida 

tomato industry and all interested 

persons were invited to attend the 

meeting and participate in Committee 

deliberations on all issues. Like all 

Committee meetings, the August 22, 

2006, meeting was a public meeting and 

all entities, both large and small, were 

able to express views on this issue. 

Finally, interested persons are invited to 

submit information on the regulatory 

and informational impacts of this action 

on small businesses. 

This proposed rule would impose no 

additional reporting or recordkeeping 

requirements on either small or large 

Florida tomato 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. 

The 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 rule. 

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. 

A 15-day comment period is provided 

to allow interested persons to respond 

to this proposed rule. Fifteen days is 

deemed appropriate because: (1) The 

2006–07 fiscal period began on August, 

1, 2006, and the marketing order 

requires that the rate of assessment for 

each fiscal period apply to all assessable 

tomatoes handled during such fiscal 

period; (2) the Committee needs to have 

sufficient funds to pay its expenses 

which are incurred on a continuous 

basis; and (3) handlers are aware of this 

action which was unanimously 

recommended by the Committee at a 

public meeting and is similar to other 

assessment rate actions issued in past 

fiscal periods. 

List of Subjects in 7 CFR Part 966 

Marketing agreements, Reporting and 

recordkeeping requirements, Tomatoes. 

For the reasons set forth in the 

preamble, 7 CFR part 966 is proposed to 

be amended as follows: 

PART 966—TOMATOES GROWN IN 

FLORIDA 

1. The authority citation for 7 CFR 

part 966 continues to read as follows: 

Authority: 7 U.S.C. 601–674. 

2. Section 966.234 is revised to read 

as follows: 

On and after August, 1, 2006, an 

assessment rate of $0.035 per 25-pound 

container or equivalent is established 

for Florida tomatoes. 

Dated: November 14, 2006. 

Lloyd C. Day, 

Administrator, Agricultural Marketing 

Service. 

[FR Doc. 06–9253 Filed 11–14–06; 1:09 pm] 

BILLING CODE 3410–02–P 


sroberts on PROD1PC70 with PROPOSALS