American Pecan Promotion Board

February 1, 2022

Alex Caryl

Sue Coleman

Marlene Betts

Agricultural Marketing Specialist

U.S. DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service • Specialty Crops Program

.

Thanks Peter. Like Peter said, I’m Alex Caryl and I’m a USDA specialist

that oversees the American Pecan Promotion Board.

I’m so glad you’re able to join us and are interested in learning more

about this new program.

I’ve really enjoyed learning about your industry these past couple of

months and hearing from you all.

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Today’s Objectives

1. Discuss roles of pecan stakeholders

2. Walk-through of forms

3. Answer questions

There are three main components to our meeting today. I’ll discuss

the roles producers, importers, and first handlers play in the

program, I’ll provide a walk-through of the forms, and at the end I’ll

answer questions that come up in the chat.

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What is 

the 

APPB? 

Research & Promotion

Program

Formed at request of

industry

Producer/importer funded

First thing’s first. What is the American Pecan Promotion

Board? Broadly speaking it is a research and promotion

program whose goal is to strengthen the position of

pecans in the marketplace, expand markets for pecans,

and also develop new uses for pecans.

It is funded by producers and importers through a

mandatory assessment and was formed at the request of

the industry in 2020.

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Many other commodities have programs like this, as a

matter of fact there’s 22 of them in total, and sometimes

they’re known as checkoff programs. Here are a handful

of examples of some of these programs’ campaigns.

You’ve got fluid milk’s got milk campaign, pork’s the other

white meat, beef it’s what’s for dinner, and of course

avocados from Mexico. Hopefully you recognize one or

two of them.

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Assessments

• Inshell: $0.02/ lb.

• Shelled: $0.04/lb.

• Domestic remitted by first

handler

• Importers remit their own

• Repercussions for noncompliance apply

Began October 1, 2021 

The APPB is funded through a mandatory assessment,

which began on October 1st of last year. The assessment

is 2 cents per pound on inshell pecans and 4 cents per

pound on shelled pecans. This is a producer and importer

funded program, but the domestic assessments are

remitted by the first handler. This means first handlers

will take 2 cents out of producers’ checks and send it to

the APPB but unpaid assessments are the responsibility

of the producers.

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Importers, on the other hand, remit their own

assessments and, like producers, are responsible if the

assessments aren’t paid. Repercussions for noncompliance may include late fees and Federal debt

collection.

We’ll go over how first handlers remit assessments later

on in the presentation.

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Annual Exemptions

Inshell: < 50,000 lbs.

Shelled: < 25,000 lbs.

USDA-certified organic

There are exemptions to this program, which I’m sure many of you are eager to hear about.

People who produce or import less than 50,000 pounds of inshell pecans or 25,000 pounds of shelled pecans

annually, or whose product is USDA-certified organic, qualify for an exemption.

When a producer or importer gets an exemption, they are not required to pay the assessment. We’ll go into

much more detail on how to request an exemption in a minute.

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Roles of Pecan

Stakeholders

So let’s get into the meat of the webinar and start with

the roles of pecan stakeholders.

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The Regulation defines...

7 CFR Part 1223 - Pecan Promotion, Research, and Information Order

Producer is synonymous with grower and means any person engaged in

the production and sale of pecans in the US who owns, or who shares in the

ownership and risk of loss of such pecans.

Importer means any person who imports pecans into the US as a principal

or as an agent, broker, or consignee of any person who produces or handles

pecans outside of the US for sale in the US, and who is listed in the import

records as the importer of record for such pecans.

First handler means any person who receives, shells, cracks, accumulates,

warehouses, roasts, packs, sells, consigns, transports, exports, or ships

(except as a common or contract carrier of pecans owned by another person),

or in any other way puts inshell or shelled pecans in the stream of commerce.

The term first handler includes a producer who handles or markets pecans of

the producer’s own production.

It wouldn’t be a government webinar without a reference to a regulation or wordy definitions, so here we are.

The regulation that created the APPB and dictates how it works defines the following terms:

Producer is synonymous with grower and means any person engaged in the production and sale of pecans in

the US who owns, or who shares in the ownership and risk of loss of such pecans. Now really keep this

definition in mind as we talk about landowner/harvester relationships later on in the webinar.

Importer means any person who imports pecans into the US as a principal or as an agent, broker, or consignee

of any person who produces or handles pecans outside of the US for sale in the US, and who is listed in the

import records as the importer of record for such pecans.

First handler means any person who receives, shells, cracks, accumulates, warehouses, roasts, packs, sells,

consigns, transports, exports, or ships (except as a common or contract carrier of pecans owned by another

person), or in any other way puts inshell or shelled pecans in the stream of commerce. The term first handler

includes a producer who handles or markets pecans of the producer’s own production.

As we’re going through the rest of the presentation, please keep these definitions in the back of your head.

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Scenario 1:

Producer

2¢ per #

First >50,000# Handler inshell

APPB

OK! Now that we’ve got the jargon out of the way, let’s go

through some scenarios to see how this all plays out in

the real world. For the sake of simplicity, let’s just assume

all pecans this universe are inshell.

Here in Scenario 1 Jane Doe is a producer who produces

100,000 pounds a year. She’s a large operation. She sells

her pecans to a facility that cleans and cracks pecans, this

is her first handler. Her assessment is collected by the

facility and it sends the money and reports to the APPB

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on her behalf.

In this scenario, Jane must pay the assessment because

she produces over 50,000 annually, but in turn she has the

opportunity to serve on the Board that oversees the

research and promotion program and can vote in a couple

of years if she wants to keep the APPB or not.

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Scenario 2:

Producer

?

First <50,000# Handler inshell

APPB

What if Jane produces perhaps 25,000 pounds? This is

scenario 2. Here, Jane still sells her pecans to the cleaning

and cracking facility but what happens with the

assessment?

In this instance Jane can do one of two things.

She can request a certificate of exemption from the APPB

that she’ll show the facility when she goes to sell her

pecans. Until she has this certificate, however, the facility

will continue to remit assessments on her pecans.

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Let’s say Jane absolutely hates paperwork and will do

anything to get out of it. Lucky for Jane, she doesn’t have

to request an exemption from the assessments, she can

keep everything the way it is and the facility will keep on

paying the 2 cents on her pecans. She doesn’t have to do

anything, but she would have to pay the assessment.

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Scenario 3:

<50,000#

inshell

First

Handler

Producer

In Scenario 3, Jane has just a couple of trees. Her harvest

is spotty and in good years she’s able to collect enough to

give to her neighbors as Christmas presents. She doesn’t

sell her pecans to a facility or anybody else for that

matter.

In this scenario, Jane doesn’t have to do anything. The

program isn’t applicable to her and she can disregard the

letter and forms she received in the mail.

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Scenario 4:

First

Handler

Harvester Jane 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

APPB

% Ownership 60% 40%

90,000 pounds 54,000 pounds 36,000 pounds

Exemption? No Yes

>50,000#

inshell

40%

As I’ve talked to more pecan producers, I’ve learned there are many different business arrangements in this

industry. I’m not going to go into each one of them, but I’ll go through one in scenario 4.

Jane inherited a pecan grove from her folks a while ago but it’s far away from where she lives now. Since she

lives so far away, she can’t come back to harvest the pecans and take care of the acreage.

Instead of leaving the pecans on the ground, she decided to let her neighbor harvest them for her. The

harvester picks up the pecans and takes them to the cleaning and cracking facility.

In return for his work, the harvester takes 60% of the profits and Jane takes 40%.

Let’s say it was a great year and the harvester retrieved a total of 90,000 pounds of pecans from Jane’s land.

Under the 60/40 arrangement, the harvester would have ownership of 54,000 pounds while Jane would only

own 36,000 pounds.

This means the harvester does not qualify for an exemption because he is over that 50,000-pound level but

Jane actually would because she’s below that level.

There are many different iterations of this arrangement that I won’t cover here, but if you’re unclear how this

works for your operation, please reach out to us and we’ll walk through it with you.

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Scenario 5:

APPB

2¢ per #

Importer

>50,000#

We’ve been talking about domestic pecan business now

let’s move on to the importers.

Scenario 5 is quite straightforward. We have an importer,

who imports more than 50,000 pounds a year into the

US. This importer will remit their own assessments to the

APPB.

Just like Scenario 1, importers who pay assessments can

serve on the Board that oversees the research and

promotion program and also vote to keep or get rid of

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the program.

Importers pay assessments on pecans that fall under these

two HTS codes on the slide.

As a side note, the APPB is not using Customs to collect

assessments, but they are using Customs data to ensure

imports are accounted for.

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Scenario 6:

Importer

Requests

exemption

APPB

<50,000#

In Scenario 6, an importer imports less than 50,000

pounds into the US. Just like with the producers, the

importer will request a certificate of exemption from the

APPB.

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Forms Walk-Through

With the hypothetical scenarios covered, let’s go over

how to do some of the things we just discussed and walkthrough the forms.

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Exemptions for Producers

Step 1: Fill out paperwork and mail to APPB

Step 2: APPB issues certificate and mails to you

Step 3: You show certificate to first handler

Step 4: First handler reports certificate number and pounds

First up is exemptions.

If you, a producer, want to request an exemption, you’ll

fill out the exemption form and mail it to the APPB with

documentation proving you qualify for the exemption.

Once the APPB receives the paperwork and determines

you are eligible, they’ll mail you a certificate of

exemption.

When you go to sell your pecans you’ll show the first

handler this certificate and they’ll make a note of how

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many pecans you sold and your certificate number in the

First Handler and Importer Report.

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Exemptions for Importers

Step 1: Fill out paperwork and mail to APPB

Step 2: APPB issues certificate and mails to you

Step 3: APPB cross-checks with Customs data

Exemptions are, again, simpler for importers.

If you’re an importer and you want a certificate of

exemption, you’ll fill out the paperwork, send it to the

APPB, and they’ll issue you a certificate of exemption.

As your imports come into the US, the APPB will cross

reference Customs data with what you provided in your

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paperwork.

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How to fill out Exemption

And this is the exemption form...it’s kind of small so I

hope you all can see it.

It’s a relatively simple form that just asks for general

information about you.

ANIMATION I do want to point out the text at the bottom

of the form here.

That text is asking for documentation that proves you

produce USDA-certified organic pecans or produce under

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50,000 pounds.

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Documentation

For FY22 Exemption 

Oct 2021 – Sep 2022 (estimate)

Production, 

inshell 

40,000

For FY23 Exemption 

Oct 2022 – Sep 2023 (estimate)

Production, 

inshell 

55,000

Oct 2020 – Sep 2021 50,000 Oct 2021 – Sep 2022 42,000

Oct 2019 – Sep 2020 60,000 Oct 2020 – Sep 2021 50,000

Oct 2018 – Sep 2019 10,000 Oct 2019 – Sep 2020 60,000

Sum 160,000 Sum 207,000

Average = 160,000/4 = 40,000

Qualifies for exemption in FY2022

Average = 205,000/4 = 51,750

Does not qualify for exemption in FY2023

X

This documentation can be anything that explicitly shows

how many pounds you produced. It can be pay stubs you

get from your buyer, records from your insurance,

spreadsheet from your accountant. Anything that shows

how much you produced.

The exemption is calculated by taking an average of the

last three fiscal periods with your projection or

estimation of the current fiscal period.

I know that’s a dense statement and it gets a bet

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confusing here so stick with me here.

The APPB regulation says the fiscal period is between

October 1 through September 30 of each year.

So when you go to request your exemption for this fiscal

period and you go to pull your records, you need get

documentation that dates back to October 2018.

The left chart here shows the fiscal years’ records you will

need to request an exemption for the fiscal period 2022,

the current period.

To see if you’re exempt, you would take a simple average

of the four years. In other words, you would take the

production from the four years, add them up, and then

divide it by four. In this example, the producer qualifies for

an exemption because the average is below 50,000

pounds.

The chart on the right is an example for next fiscal period.

You’ll see the production number for fiscal periods 2020

and 2021 are the same, but you’ll see fiscal period 2022’s

production is different. That’s because last year the

producer actually produced 2,000 more pounds than

expected. You’ll also see the estimate production for fiscal

year 2023.

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You’ll need to file an exemption every year before the

beginning of the next fiscal period.

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CLARIFICATION! 

• If you file now, you’re filing for fiscal period 2022

• NEED to file again before Sep 30, 2022 for next fiscal

period

Clarification!

Since this is the APPB’s first year and we’re just now

getting forms out to producers, if you’re filing for an

exemption now or soon after the recording of this

webinar, you’re filing for the fiscal period that started in

October of 2021 and goes through September of 2022.

You’ll need to file again later this year for the next fiscal

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period.

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Reimbursement Form

If you have paid assessments and you have obtained a

certificate of exemption, you can request a

reimbursement of those assessments.

You’ll use this form to ask for the reimbursement. For the

sake of time I’m not going to go through it, but if you

have any issues filling it out please reach out.

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First Handler/Importer Report

Due 10th of every month

Let’s move on to the First Handler and Importer report.

As the name implies, it is to be completed by the first

handlers when they remit the assessments on behalf of

the producers.

Importers also complete this when they’re sending in

their assessments.

It’s a monthly report that’s due before the 10th of every

month.

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This is what the report looks like. Let’s go through it partby-part.

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First Handler/Importer Report

Part A requests general information about the first

handler or importer filling out the form. It’s fairly selfexplanatory, but I will elaborate on the unique identifier.

This is anything that identifies the company moving the

pecans. For first handlers it generally is an EIN number

from federal forms or for an importer it is a number from

Customs.

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Please note the address you’ll send the form to in the top

right-hand corner.

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Part B: First Handler Example

Moving on to Part B, you’ll see places to fill in

information.

For first handlers, you’ll put the name of the producer,

their address, and any unique identifier you have

available.

The unique identifier is useful on the APPB’s compliance

side to track assessments.

You will fill out how many pounds this producer sold to

you, and you’ll calculate how much in assessments is

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being remitted. You’ll do this for each producer who sells

pecans to you without a certificate of exemption.

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Part B: Importer Example

Unique identifier is the “Entry Number” from the Entry Summary (CBP Form 7501)

It’s a similar deal for the importers except the names and

address of the producers aren’t necessary. Instead, put

the country of origin.

In the unique identifier you can use the entry number

from the Entry Summary (CBP Form 7501). You’ll do this

for each load you import.

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Part C: First Handler Example

First handlers record exempted pecans in Part C.

The form fields are the same as Part B except you’ll

include the certification exemption number in the farright column.

That being said, to be able to log a producer’s pecans in

this section, they need to show you a current certificate

of exemption they’ve received from the APPB.

Certificates from previous years cannot be used.

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Part C: Importer Example

Since Customs isn’t collecting assessments at this time,

importers will only use Part C to report USDA organic

pecans.

ANIMATION I want to point out some fine print here that

might help you with this record keeping.

The form allows you to attach your own sheet instead of

filling out the form. So if you have spreadsheets of your

own, or even hand written notebooks that already have

this information, you can send that in with the form

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instead of filling it out.

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Mail all forms, documentation

and checks to...

P.O. Box 71

San Angelo, TX 76902

Contact Maggie Pepper for ACH banking information

mpepper@armstrongbackus.com

• All forms and checks should be mailed to this PO Box

here. If you prefer to wire the funds, contact Maggie to

get the banking information.

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Forms available at:

www.ams.usda.gov/APPB

All the forms we discussed today are on the APPB’s

webpage at this address.

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Confidentiality

§ 1223.62 Confidential treatment. All information obtained from books, records, or reports under

the Act and this part shall be kept confidential by all persons, including all employees and former

employees of the Board, all officers and employees and former officers and employees of

contracting and subcontracting agencies or agreeing parties having access to such information.

Such information shall not be available to Board members, producers, importers, or first

handlers. Only those persons having a specific need for such information to effectively

administer the provisions of this subpart shall have access to such information. Only such

information so obtained as the Secretary deems relevant shall be disclosed by them, and then

only in a judicial proceeding or administrative hearing brought at the direction, or on the request,

of the Secretary, or to which the Secretary or any officer of the United States is a party and

involving this subpart. Nothing in this section shall be deemed to prohibit:

(a) The issuance of general statements based upon the reports of the number of persons subject

to this subpart or statistical data collected therefrom, which statements will not identify the

information furnished by any person; and

(b) The publication, by direction of the Secretary, of the name of any person who has been

adjudged to have violated this subpart, together with a statement of the particular provisions of

this subpart violated by such person.

These forms ask for a lot of information, some of which

you might even consider proprietary.

We know that confidentiality is a major concern in your

industry, as it is in most other industries.

That’s why the regulation has a whole section discussing

confidentiality, which you can see on the slide here.

I won’t read it but I’ll give you the highlights.

The only people who will have individuals’ information

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provided on these forms and the checks are the staff

processing the assessments and, if requested, USDA.

Board members do not see the forms, databases, nor bank

statements that show who paid and how much.

Currently the APPB has a third-party accounting firm

receiving and processing the assessments and

documentation.

Under no circumstance will the individual information you

provide be shared.

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If you suspect a violation

of confidentiality:

Contact:

USDA Market Development Division – (202) 720-9915

USDA Office of Inspector General – (800) 494-9121

If you suspect a violation of confidentiality by any party,

please contact my office, the USDA Market Development

Division or USDA’s Office of Inspector General.

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Thank you!

That concludes the end of the stakeholder role and forms

discussion. Up next is Q&A. And for that I’ll hand it back

over to Peter.

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Send assessments and forms

to:

Maggie Pepper

PO Box 71

San Angelo, TX 76902

(325) 653-6854

mpepper@armstrongbackus.com

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General Questions

Contact:

Alex Caryl

(202) 253-4768

Alexandra.Caryl@usda.gov

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Important Link

www.ams.usda.gov/APPB 

• Forms

• Updates

• Meeting materials

• Q&A

• Recording of this webinar

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