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

50 titles pursuant to 44 U.S.C. 1510.

The Code of Federal Regulations is sold by

the Superintendent of Documents. Prices of

new books are listed in the first FEDERAL

REGISTER issue of each week.

Rules and Regulations Federal Register

69851

Vol. 65, No. 225

Tuesday, November 21, 2000

DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 905

[Docket No. FV00–905–4 FIR]

Oranges, Grapefruit, Tangerines, and

Tangelos Grown in Florida; Limiting

the Volume of Small Red Seedless

Grapefruit

AGENCY: Agricultural Marketing Service,

USDA.

ACTION: Final rule.

SUMMARY: The Department of

Agriculture (Department) is adopting, as

a final rule, without change, the

provisions of an interim final rule

limiting the volume of small red

seedless grapefruit entering the fresh

market under the marketing order

covering oranges, grapefruit, tangerines,

and tangelos grown in Florida. The

marketing order is administered locally

by the Citrus Administrative Committee

(Committee). This rule limits the

volume of sizes 48 (at least 39⁄16 inches

in diameter) and 56 (at least 35⁄16 inches

in diameter) red seedless grapefruit

handlers can ship during the first 11

weeks of the 2000–2001 season

beginning September 18, 2000. This

limitation provides a sufficient supply

of small sized red seedless grapefruit to

meet market demand, without saturating

all markets with these small sizes. This

rule should help stabilize the grapefruit

market and improve grower returns.

EFFECTIVE DATE: November 22, 2000.

FOR FURTHER INFORMATION CONTACT:

William G. Pimental, Southeast

Marketing Field Office, Marketing Order

Administration Branch, Fruit and

Vegetable Programs, AMS, USDA, P.O.

Box 2276, Winter Haven, Florida

33883–2276; telephone: (863) 299–4770,

Fax: (863) 299–5169; or George Kelhart,

Technical Advisor, Marketing Order

Administration Branch, Fruit and

Vegetable Programs, AMS, USDA, room

2525–S, P.O. Box 96456, Washington,

DC 20090–6456; telephone: (202) 720–

2491, Fax: (202) 720–5698.

Small businesses may request

information on complying with this

regulation by contacting Jay Guerber,

Marketing Order Administration

Branch, Fruit and Vegetable Programs,

AMS, USDA, room 2525–S, P.O. Box

96456, Washington, DC 20090–6456;

telephone (202) 720–2491, Fax: (202)

720–5698, or E-mail:

Jay.Guerber@usda.gov.

SUPPLEMENTARY INFORMATION: This rule

is issued under Marketing Agreement

No. 84 and Marketing Order No. 905,

both as amended (7 CFR part 905),

regulating the handling of oranges,

grapefruit, tangerines, and tangelos

grown in Florida, hereinafter referred to

as the ‘‘order.’’ The marketing

agreement and order are 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 is issuing this rule in

conformance with Executive Order

12866.

This final rule has been reviewed

under Executive Order 12988, Civil

Justice Reform. This rule is not intended

to have retroactive effect. 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 the Secretary 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 the Secretary 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 the Secretary’s ruling on the

petition, provided an action is filed not

later than 20 days after the date of the

entry of the ruling.

The order provides for the

establishment of grade and size

requirements for Florida citrus, with the

concurrence of the Secretary. These

grade and size requirements are

designed to provide fresh markets with

citrus fruit of acceptable quality and

size. This helps create buyer confidence

and contributes to stable marketing

conditions. This is in the interest of

growers, handlers, and consumers, and

is designed to increase returns to

Florida citrus growers. The current

minimum grade standard for red

seedless grapefruit is U.S. No. 1, and the

minimum size requirement is size 56 (at

least 35⁄16 inches in diameter).

This final rule limits the volume of

small red seedless grapefruit entering

the fresh market. This rule establishes

limits on the volume of sizes 48 and 56

red seedless grapefruit handlers can

ship during the first 11 weeks of the

2000–2001 season. The limitations

began September 18, 2000. This rule

supplies enough small sized red

seedless grapefruit to meet market

demand, without saturating all markets

with these small sizes. This rule will

help stabilize the grapefruit market and

improve grower returns.

Section 905.52 of the order provides

authority to limit shipments of any

grade or size, or both, of any variety of

Florida citrus. Such limitations may

restrict the shipment of a portion of a

specified grade or size of a variety.

Under such a limitation, the quantity of

such grade or size that may be shipped

by a handler during a particular week is

established as a percentage of the total

shipments of such variety by such

handler in a prior period, established by

the Committee and approved by the

Secretary, in which the handler shipped

such variety.

Section 905.153 of the regulations

provides procedures for limiting the

volume of small red seedless grapefruit

entering the fresh market. The

procedures specify that the Committee

may recommend that only a certain

percentage of sizes 48 and 56 red

seedless grapefruit be made available for

shipment into fresh market channels for

any week or weeks during the regulatory

period. The regulation period is 11

weeks long and begins the third Monday

in September. Under such a limitation,

the quantity of sizes 48 and 56 red

seedless grapefruit that may be shipped

by a handler during a regulated week is

69852 Federal Register / Vol. 65, No. 225 / Tuesday, November 21, 2000 / Rules and Regulations

calculated using the recommended

percentage. By taking the recommended

weekly percentage times the average

weekly volume of red grapefruit

handled by such handler in the previous

five seasons, handlers can calculate the

total volume of sizes 48 and 56 they

may ship in a regulated week.

This rule limits the volume of small

red seedless grapefruit that can enter the

fresh market for the remaining weeks of

the 11-week period, which began the

week of September 18, 2000. This rule

continues in effect the interim final rule

which established the weekly

percentage for the first three weeks

(September 18 through October 8) at 45

percent; for the fourth through seventh

weeks (October 9 through November 5)

at 40 percent; and for the last four weeks

(November 6 through December 3) at 35

percent.

These percentages are different from

those originally recommended by the

Committee on May 26, 2000. At that

time, the Committee unanimously voted

to establish a weekly percentage of 25

percent for each of the 11 weeks. The

Committee’s initial recommendation

was issued as a proposed rule published

in the Federal Register on July 11, 2000

(65 FR 42642). No comments were

received during the comment period,

which expired August 10, 2000. The

Committee subsequently met on August

31, 2000, and unanimously

recommended adjusting the proposed

percentages. The Committee’s

recommendation was issued as an

interim final rule published on

September 15, 2000 (65 FR 55885).

Comments on that action were invited

until September 25, 2000. No comments

were received.

The Committee recognizes the need

for and the benefits of the weekly

percentage regulation. Members believe

that the problems associated with an

uncontrolled volume of small sizes

entering the market early in the season

will recur without such action.

As in the previous three seasons, the

Committee initially recommended that

the weekly percentage of size regulation

be set at 25 percent for each week

during the regulatory period. The

Committee thought it was best to set

regulation at the most restrictive level,

25 percent for each of the 11 weeks in

the regulated period, and then relax the

percentages as warranted by information

available closer to the start of the

season.

On August 31, 2000, the Committee

revisited the weekly percentage issue

and reviewed information it had

acquired since its May meeting. It

determined that the initial

recommendation was too restrictive,

and recommended raising the

established base percentages from 25

percent for each of the regulation weeks.

In its discussion, the Committee

reviewed the initial percentages

recommended and the state of the crop.

The Committee also reexamined

shipping information from past seasons,

looking particularly at volume across

the 11 weeks. The Committee noted that

more information helpful in

determining the appropriate weekly

percentages is available closer to the

start of the harvesting season. At the

time of the May meeting, grapefruit had

not yet begun to size, giving little

indication as to the distribution of sizes.

Only the most preliminary of crop

estimates was available, with the official

estimate not to be issued until October.

The 2000–2001 season crop is

continuing to size well. Current

indications are that early-season

conditions for this year are similar to

those of last season. Due to the

anticipated similarities, the Committee

considered the percentages established

last year as a basis for discussing this

year’s percentages. Committee members

thought that last season’s percentages

had worked well, providing some

restriction while affording volume for

those markets that prefer the smaller

sizes. In making its recommendation,

the Committee considered that there

had been a reduction in the overall

available weekly industry base due to

industry consolidation, a reduction in

shipments, and packinghouse closings.

The available weekly industry base is

the sum of each individual handler’s

weekly base. A handler’s base is

calculated by taking that handler’s total

red seedless grapefruit shipments

during the 33 week season for each of

the past five seasons, adding them

together and dividing by five to

calculate an average season. This

number is then divided by 33 to derive

the average week. This average week is

the base for each handler for each of the

11 weeks of the regulatory period. The

overall available industry base per week

was 937,257 cartons last season. For the

2000–2001 season, the base calculates to

875,688 cartons.

To recognize this reduction in

available base, the Committee

recommended establishing the weekly

percentages at levels slightly higher

than those established for last season.

The Committee agreed that the

percentage established for the first two

weeks of last season of 45 percent was

still appropriate, and recommended that

the percentages for the first two weeks

of the 2000–2001 season be established

at 45 percent. The Committee

recommended that the third week

should also be established at 45 percent,

a five percent increase from last season’s

third week percentage. For the next four

weeks the Committee recommended

that the weekly percentage be

established at 40 percent, an increase

from 37 percent for last season. For the

last four weeks of regulation, the

Committee recommended that the

percentage be established at 35 percent,

an increase from last season’s 32 percent

for the final four weeks.

The ongoing problems affecting the

European and Asian markets are also a

factor. In past seasons, these markets

have shown a strong demand for the

smaller-sized red seedless grapefruit.

The reduction in shipments to these

areas experienced during the last few

years is expected to continue during the

upcoming season. This reduction in

demand could result in a greater amount

of small sizes for remaining markets to

absorb. These factors increase the need

for restrictions to prevent the volume of

small sizes from overwhelming all

markets.

Therefore, based on available

information and the experiences from

past seasons, the Committee

recommended changing the initial

weekly percentages from their most

restrictive level. The Committee could

meet again during the regulation period,

as needed, when additional information

is available, and determine whether the

set percentage levels are appropriate.

Any changes to the weekly percentages

established by this rule would require

additional rulemaking and the approval

of the Secretary.

During the three seasons prior to

implementation of weekly percentage

regulations (1994–95, 1995–96, and

1996–97), returns for red seedless

grapefruit had been declining, often not

returning the cost of production. On-tree

prices for red seedless grapefruit had

fallen steadily from $9.60 per carton (4⁄5

bushel) during the 1989–90 season, to

$3.45 per carton during the 1994–95

season, to $1.41 per carton during the

1996–97 season.

The Committee determined that one

problem contributing to the market’s

condition was the excessive number of

small-sized grapefruit shipped early in

the marketing season. In the 1994–95,

1995–96, and 1996–97 seasons, sizes 48

and 56 accounted for 34 percent of total

shipments during the 11-week

regulatory period, with the average

weekly percentage exceeding 40 percent

of shipments. This contrasted with sizes

48 and 56 representing only 26 percent

of total shipments for the remainder of

the season.

While there is a market for early

grapefruit, shipping large quantities of

Federal Register / Vol. 65, No. 225 / Tuesday, November 21, 2000 / Rules and Regulations 69853

small red seedless grapefruit in a short

period oversupplies the fresh market for

these sizes and negatively impacts the

market for all sizes. For the majority of

the season, larger sizes return higher

prices than smaller sizes. However,

there is a push early to get fruit into the

market to take advantage of high prices

available at the beginning of the season.

The early season crop tends to have a

greater percentage of small sizes. This

creates a glut of smaller, lower-priced

fruit on the market, driving down the

price for all sizes.

At the start of the season, larger-sized

fruit command a premium price. In

some cases, the f.o.b. price is $4 to $10

more a carton than for the smaller sizes.

In October, the f.o.b. price for a size 27

averages around $14.00 per carton. This

compares to an average f.o.b. price of

$6.00 per carton for size 56. In the three

years before the issuance of a percentage

size regulation, by the end of the 11-

week period covered in this rule, the

f.o.b. price for large sizes dropped to

within $1 or $2 of the f.o.b. price for

small sizes.

In the three seasons prior to 1997–98,

prices of red seedless grapefruit fell

from a weighted average f.o.b. price of

$7.80 per carton to an average f.o.b.

price of $5.50 per carton during the

period covered by this rule. Later in the

season the crop sized to naturally limit

the amount of smaller sizes available for

shipment. However, the price structure

in the market had already been

negatively affected. The market never

recovered, and the f.o.b. price for all

sizes fell to around $5.00 to $6.00 per

carton for most of the rest of the season.

An economic study done by the

University of Florida—Institute of Food

and Agricultural Sciences (UF–IFAS) in

May 1997, found that on-tree prices had

fallen from a high near $7.00 per carton

in 1991–92 to around $1.50 per carton

for the 1996–97 season. The study

projected that if the industry elected to

make no changes, the on-tree price

would remain around $1.50 per carton.

The study also indicated that increasing

minimum size restrictions could help

raise returns.

The Committee believes that the over

shipment of smaller sized red seedless

grapefruit early in the season

contributes to poor returns for growers

and lower on-tree values. To address

this issue, the Committee voted to

utilize the provisions of § 905.153, and

established a weekly percentage of size

regulation during the first 11 weeks of

the 1997–98, 1998–99, and 1999–2000

seasons. The initial recommendation

from the Committee was to set the

weekly percentages at 25 percent for

each of the 11 weeks. Then, as more

information on the crop became

available, and as the season progressed,

the Committee met again and adjusted

its recommendations for the weekly

percentages as needed. Actual weekly

percentages established during the 11-

week period during the 1999–2000

season were 45 percent for the first two

weeks, 40 percent for the third week, 37

percent for the fourth through the

seventh week, and 32 percent for the

last four weeks. The Committee

considered information from past

seasons, crop estimates, fruit size, and

other available information in making

its recommendations.

The Committee has used the

percentage size regulation to the

betterment of the industry. Prices have

increased, and movement has been

stable. In each of the three seasons

following the 1996–97 season, the

Committee has recommended utilizing

the percentage size rule. During the 11-

week period of regulation, the average

market price has been higher than for

the three years prior to regulation. In

late October, the average market price

for red seedless grapefruit was $9.31 for

the last three years regulation compared

to $7.22 for the same period for the

three years prior to regulation. Market

prices also remained at a higher level,

with an average price of $7.31 in midDecember during regulation compared

to $6.02 for the three years prior to

regulation. The average season price

was also higher, with the past three

seasons averaging $7.13 compared to

$5.83 for the three prior years.

The on-tree earnings per box have

also been increasing for the past three

years, providing better returns to

growers. The on-tree price increased

from $3.42 for 1997–98, to $5.04 for

1998–99, to an estimated $6.46 for the

1999–2000 season.

Another benefit of percentage size

regulation has been in maintaining

higher prices for the larger-sized fruit.

Larger fruit commands a premium price

early in the season. The f.o.b. price for

a larger size can be $4 to $10 more per

carton than for smaller sizes. However,

the glut of smaller, lower-priced fruit on

the early market was driving down the

prices for all sizes. In the three years

prior to the implementation of the

percentage size rule, by the end of the

11-week period covered, the f.o.b. price

for the large sizes would drop to within

$2 of the f.o.b. price for the smaller

sizes. This was not acceptable to the

industry.

During the past three years of

regulation under the percentage size

rule, the average differential between

the carton price for a size 27 and the

price for a size 56 was $5.65 at the end

of October and remained at $3.43 in

mid-December. During the three years

prior to regulation, the average

differential between these two sizes was

$3.47 at the end of October, but by midDecember the price for the larger size

had dropped to within $1.68 of the price

for the smaller-size fruit. In fact, the

average prices for each size were higher

during the three years with regulation

than for the three years prior to

regulation. The average prices for size

27, size 32, size 36, and size 40 during

the 11-week period for the last three

years were $9.07, $7.91, $7.16, and

$6.62, respectively. This compares to

the average prices for the same sizes

during the same period for the three

years prior to regulation of $6.48, $5.63,

$5.59, and $5.34, respectively.

The percentage size regulation has

also been helpful in stabilizing the

volume of small sizes entering the fresh

market early in the season. During the

three years prior to regulation, small

sizes accounted for over 34 percent of

the total shipments of red seedless

grapefruit during the 11-week period

covered in the rule. This compares to 31

percent for the same period for the last

three years of regulation. There has also

been a 43 percent reduction in the

volume of small sizes entering the fresh

market during the 11-week regulatory

period from 1995–96 to 1999–2000.

An economic study done by Florida

Citrus Mutual (Lakeland, Florida) in

April 1998 found that the weekly

percentage regulation had been

effective. The study stated that part of

the strength in early season pricing

appeared to be due to the use of the

weekly percentage rule to limit the

volume of sizes 48 and 56. It said that

prices were generally higher across the

size spectrum with sizes 48 and 56

having the largest gains, and larger-sized

grapefruit registering modest

improvements. The rule shifted the size

distribution toward the higher-priced,

larger-sized grapefruit, which helped

raise weekly average f.o.b. prices. It

further stated that size 48 and 56

grapefruit accounted for around 27

percent of domestic shipments during

the same 11 weeks during the 1996–97

season. Comparatively, sizes 48 and 56

accounted for only 17 percent of

domestic shipments during the same

period in 1997–98, as small sizes were

used to supply export customers with

preferences for small-sized grapefruit.

During deliberations in past seasons

as to weekly percentages, the Committee

considered how past shipments had

affected the market. Based on available

statistical information, the Committee

members believed that once shipments

of sizes 48 and 56 reach levels above

69854 Federal Register / Vol. 65, No. 225 / Tuesday, November 21, 2000 / Rules and Regulations

250,000 cartons a week, prices declined

on those and most other sizes of red

seedless grapefruit. The Committee

believed that if shipments of small sizes

could be maintained at around 250,000

cartons a week, prices should stabilize

and demand for larger, more profitable

sizes should increase.

While the Committee did eventually

vote last season to increase the weekly

percentages, shipments of sizes 48 and

56 during the 11 weeks regulated

remained close to the 250,000-carton

mark. This may have contributed to the

success of the regulation.

In setting the weekly percentage for

each week at 25 percent for the 2000–

2001 season, the total available

allotment would have approximated

218,922 (25 percent of the total industry

base of 875,688 cartons). Consequently,

there was room to increase the

percentages while holding weekly

shipments of sizes 48 and 56 close to

the 250,000-carton mark, as was done

last season.

In making its recommendation, the

Committee reviewed experiences from

the past seasons. The Committee

examined shipment data covering the

11-week regulatory period for the last

three regulated seasons and the three

prior seasons. The information

contained the amounts and percentages

of sizes 48 and 56 shipped during each

week. The Committee believes

establishing weekly percentages during

the last three seasons was successful.

The past regulations helped maintain

prices at a higher level than the

previous years without regulation, and

sizes 48 and 56 by count and as a

percentage of total shipments were

reduced. The Committee considered the

past problems and the success of the

percentage rule and decided to

recommend using the percentage of size

provisions for the 2000–2001 season.

The limitations began September 18,

2000.

Therefore, this rule continues in effect

the interim final rule which established

the weekly percentages at 45 percent for

the first three weeks (September 18

through October 8); for the fourth

through seventh weeks (October 9

through November 5) at 40 percent; and

for the last four weeks (November 6

through December 3) at 35 percent.

Under § 905.153, the quantity of sizes

48 and 56 red seedless grapefruit that

may be shipped by a handler during a

regulated week will be calculated using

the recommended percentages 45, 40, or

35 percent, depending on the week. By

taking the weekly percentage times the

average weekly volume of red grapefruit

handled by such handler in the previous

five seasons, handlers can calculate the

total volume of sizes 48 and 56 they

may ship in a regulated week.

The Committee calculates an average

week for each handler using the

following formula. The total red

seedless grapefruit shipments by a

handler during the 33 week period

beginning the third Monday in

September and ending the first Sunday

in May during the previous five seasons

are added and divided by five to

establish an average season. This

average season is then divided by the 33

weeks to derive the average week. This

average week is the base for each

handler for each of the 11 weeks of the

regulatory period. The weekly

percentage, in this case either 45, 40, or

35 percent, is multiplied by a handler’s

average week. The product is that

handler’s total allotment of sizes 48 and

56 red seedless grapefruit for the given

week.

Under this rule handlers can fill their

allotment with size 56, size 48, or a

combination of the two sizes such that

the total of these shipments are within

the established limits. The Committee

staff performs the specified calculations

and provides them to each handler.

The average week for handlers with

less than five previous seasons of

shipments is calculated by averaging the

total shipments for the seasons they did

ship red seedless grapefruit during the

immediately preceding five years and

dividing that average by 33. New

handlers with no record of shipments

have no prior period on which to base

their average week. Therefore, a new

handler can ship small sizes equal to 45,

40, or 35 percent, depending on the

week, of their total volume of shipments

during their first shipping week

(depending on when they begin

shipping). Once a new handler has

established shipments, their average

week is calculated as an average of the

weeks they have shipped during the

current season.

As mentioned before, the 2000–2001

regulatory period begins the third

Monday in September, September 18,

2000. Each regulation week begins

Monday at 12:00 a.m. and ends at 11:59

p.m. the following Sunday, since most

handlers keep records based on Monday

being the beginning of the workweek.

The rules and regulations governing

percentage size regulation contain a

variety of provisions designed to

provide handlers with some marketing

flexibility. When the Secretary

establishes regulation for a given week,

the Committee calculates the quantity of

small red seedless grapefruit that may

be handled by each handler. Section

905.153(d) provides allowances for

overshipments, loans, and transfers of

allotment. These tolerances allow

handlers the opportunity to supply their

markets while limiting the impact of

small sizes.

During any week for which the

Secretary has fixed the percentage of

sizes 48 and 56 red seedless grapefruit,

any handler could handle an amount of

sizes 48 or 56 red seedless grapefruit not

to exceed 110 percent of their allotment

for that week. The quantity of

overshipments (the amount shipped in

excess of a handler’s weekly allotment)

is deducted from the handler’s

allotment for the following week.

Overshipments are not allowed during

week 11 because there are no allotments

the following week from which to

deduct the overshipments.

If handlers fail to use their entire

allotments in a given week, the amounts

undershipped are not carried forward to

the following week. However, a handler

to whom an allotment has been issued

can lend or transfer all or part of such

allotment (excluding the overshipment

allowance) to another handler. In the

event of a loan, each party, prior to the

completion of the loan agreement,

notifies the Committee of the proposed

loan and date of repayment. If a transfer

of allotment is desired, each party will

promptly notify the Committee so that

proper adjustments of the records can be

made. In each case, the Committee

confirms in writing all such transactions

prior to the following week.

The Committee can also act on behalf

of handlers wanting to arrange allotment

loans or participate in the transfer of

allotment. Repayment of an allotment

loan is at the discretion of the handlers

party to the loan. The Committee will

notify each handler prior to that

particular week of the quantity of sizes

48 and 56 red seedless grapefruit such

handler can handle during a particular

week, making the necessary adjustments

for overshipments and loan repayments.

This rule does not affect the provision

that handlers may ship up to 15

standard packed cartons (12 bushels) of

fruit per day exempt from regulatory

requirements. Fruit shipped in gift

packages that are individually

addressed and not for resale, and fruit

shipped for animal feed are also exempt

from handling requirements under

specific conditions. Also, fruit shipped

to commercial processors for conversion

into canned or frozen products or into

a beverage base are not subject to the

handling requirements under the order.

The introductory text of § 905.350 is

being modified to reflect a change to

§ 905.306 establishing the minimum

size for red seedless grapefruit at size 56

on a continuous basis. A final rule

implementing this change has been

Federal Register / Vol. 65, No. 225 / Tuesday, November 21, 2000 / Rules and Regulations 69855

published in the Federal Register at 65

FR 66601, November 7, 2000.

Section 8e of the Act requires that

whenever grade, size, quality, or

maturity requirements are in effect for

certain commodities under a domestic

marketing order, including grapefruit,

imports of that commodity must meet

the same or comparable requirements.

This rule does not change the minimum

grade and size requirements under the

order, only the percentages of sizes 48

and 56 red grapefruit that may be

handled. Therefore, no change is

necessary in the grapefruit import

regulations as a result of this action.

Pursuant to requirements set forth in

the Regulatory Flexibility Act (RFA),

AMS has considered the economic

impact of this action 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 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 75 grapefruit

handlers subject to regulation under the

order and approximately 11,000 growers

of citrus in the regulated area. Small

agricultural service firms, which

includes handlers, have been defined by

the Small Business Administration

(SBA) as those having annual receipts of

less than $5,000,000, and small

agricultural producers are defined as

those having annual receipts of less than

$500,000 (13 CFR 121.201).

Based on industry and Committee

data, the average annual f.o.b. price for

fresh Florida red grapefruit during the

1999–2000 season was around $7.52 per

4/5 bushel carton, and total fresh

shipments for the 1999–2000 season are

estimated at 25.6 million cartons of red

grapefruit. Approximately 25 percent of

all handlers handled 70 percent of

Florida grapefruit shipments. In

addition, many of these handlers ship

other citrus fruit and products which

are not included in Committee data but

would contribute further to handler

receipts. Using the average f.o.b. price,

about 69 percent of grapefruit handlers

could be considered small businesses

under SBA’s definition. Therefore, the

majority of Florida grapefruit handlers

may be classified as small entities. The

majority of Florida grapefruit producers

also may be classified as small entities.

This rule continues to limit the

volume of small red seedless grapefruit

entering the fresh market during the first

11 weeks of the 2000–2001 season,

beginning September 18, 2000. The over

shipment of smaller-sized red seedless

grapefruit early in the season has

contributed to below production cost

returns for growers and lower on tree

values. This rule limits the volume of

sizes 48 and 56 red seedless grapefruit

by setting the weekly percentage for the

11 weeks at 45 percent for the first three

weeks (September 18 through October

8); for the fourth through seventh weeks

(October 9 through November 5) at 40

percent; and for the last four weeks

(November 6 through December 3) at 35

percent. This is a change from the

Committee’s original recommendation

of a 25 percent weekly percentage for

the 11 weeks. The quantity of sizes 48

and 56 red seedless grapefruit that may

be shipped by a handler during a

particular week is calculated using the

recommended percentage. This rule

utilizes the provisions of ‘‘ 905.153.

Authority for this action is provided in

§ 905.52 of the order.

While this rule may necessitate spot

picking, which could entail slightly

higher harvesting costs, many in the

industry are already using the practice.

In addition, because this regulation is

only in effect for part of the season, the

overall effect on costs is minimal. This

rule is not expected to appreciably

increase costs to producers. Over the

past three seasons, producers have

adjusted their harvesting operations to

more efficiently conform with the

percentage size regulation and to keep

their harvesting costs as low as possible.

If a 25 percent restriction on small

sizes had been applied during the 11-

week period for the three seasons prior

to the 1997–98 season, an average of 4.2

percent of overall shipments during that

period would have been constrained by

regulation. A large percentage of this

volume most likely could have been

replaced by larger sizes for which there

are no volume restrictions. Under

regulation, larger sizes have been

substituted for smaller sizes with a

nominal effect on overall shipments.

Also, handlers can transfer, borrow or

loan allotment based on their needs in

a given week. Handlers also have the

option of over shipping their allotment

by 10 percent in a week, provided the

overshipment is deducted from the

following week’s shipments.

Approximately 120 loans and transfers

were utilized last season. Statistics for

1999–2000 show that in none of the

regulated weeks was the total available

allotment used. Therefore, the overall

impact of this regulation on total

shipments should be minimal.

Handlers and producers have received

higher returns under percentage size

regulation. In late October, during the

last three years with regulation, the

average market price for red seedless

grapefruit was $9.31 compared to $7.22

for the same time during the three years

prior to regulation. Prices have also

remained higher, with an average price

of $7.31 in mid-December during

regulation compared to $6.02 for the

three years prior to regulation. The

average season price was also higher,

with the past three seasons with

regulation averaging $7.13 compared to

$5.83 for the three prior seasons.

The on-tree earnings per box have

also increased for the past three years,

providing better returns to growers. The

on-tree price increased from $3.42 for

1997–98, to $5.04 for 1998–99, to an

estimated $6.46 for the 1999–2000

season. These increased returns when

coupled with the overall volume of red

seedless grapefruit more than offset any

additional costs associated with this

regulation.

The purpose of this rule is to help

stabilize the market and improve grower

returns by limiting the volume of small

sizes marketed early in the season. This

rule provides a supply of small-sized

red seedless grapefruit sufficient to meet

market demand, without saturating all

markets with these small sizes. The

opportunities and benefits of this rule

are expected to be available to all red

seedless grapefruit handlers and

growers regardless of their size of

operation.

The Committee considered one

alternative to taking this action. The

alternative was leaving the weekly

percentages at 25 percent. However, the

Committee believed that the 25 percent

level was too restrictive. Therefore, this

option was rejected.

Handlers utilizing the flexibility of

the loan and transfer aspects of this

action are required to submit a form to

the Committee. The rule increases the

reporting burden on approximately 75

handlers of red seedless grapefruit who

will be taking about 0.03 hour to

complete each report regarding

allotment loans or transfers. The

information collection requirements

contained in this section have been

approved by the Office of Management

and Budget (OMB) under the provisions

of the Paperwork Reduction Act of 1995

(44 U.S.C. Chapter 35) and assigned

OMB number 0581–0094. As with all

Federal marketing order programs,

reports and forms are periodically

reviewed to reduce information

69856 Federal Register / Vol. 65, No. 225 / Tuesday, November 21, 2000 / Rules and Regulations

requirements and duplication by

industry and public sectors.

The Department has not identified

any relevant Federal rules that

duplicate, overlap or conflict with this

interim final rule. However, red seedless

grapefruit must meet the requirements

as specified in the U.S. Standards for

Grades of Florida Grapefruit (7 CFR

51.760 through 51.784) issued under the

Agricultural Marketing Act of 1946 (7

U.S.C. 1621 through 1627).

The Committee’s meetings were

widely publicized throughout the citrus

industry and all interested persons were

invited to attend the meetings and

participate in Committee deliberations

on all issues. Like all Committee

meetings, the May 26, 2000 and the

August 31, 2000, meetings were public

meetings and all entities, both large and

small, were able to express views on

this issue. Also, interested persons were

invited to submit information on the

regulatory and informational impacts of

this action on small businesses.

An interim final rule concerning this

action was published in the Federal

Register on September 15, 2000 (65 FR

55885). Copies of the rule were mailed

or sent via facsimile to all Committee

members and grapefruit growers and

handlers. The Office of the Federal

Register, the Department, and the

Committee also made this rule available

through the Internet.

A 10-day comment period was

provided to allow interested persons to

respond to the proposal. The comment

period ended September 25, 2000. 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

Committee’s recommendation, and

other information, it is found that

finalizing the interim final rule, without

change, as published in the Federal

Register (65 FR 55885, September 15,

2000) will tend to effectuate the

declared policy of the Act.

It is further found that good cause

exists for not postponing the effective

date of this rule until 30 days after

publication in the Federal Register (5

U.S.C. 553) because the 2000–2001

season is in full swing and this action

should be effective as soon as possible

during the 11-week regulatory period.

Further, handlers are aware of this rule

which was recommended at two public

meetings. Also a 30-day comment

period was provided in the proposed

rule and a 10-day comment period was

provided in the interim final rule. No

comments were received.

List of Subjects in 7 CFR Part 905

Grapefruit, Marketing agreements,

Oranges, Reporting and recordkeeping

requirements, Tangelos, Tangerines.

PART 905—ORANGES, GRAPEFRUIT,

TANGERINES, AND TANGELOS

GROWN IN FLORIDA

Accordingly, the interim final rule

amending 7 CFR Part 905 which was

published at 65 FR 55885 on September

15, 2000, is adopted as a final rule

without change.

Dated: November 14, 2000

James R. Frazier

Acting Deputy Administrator, Fruit and

Vegetable Programs.

[FR Doc. 00–29705 Filed 11–20–00; 8:45 am]

BILLING CODE 3410–02–P

DEPARTMENT OF AGRICULTURE

7 CFR Part 2812

RIN 0599–AA06

Office of Procurement and Property

Management; Department of

Agriculture Priorities and

Administrative Guidelines for Donation

of Excess Research Equipment

AGENCY: Office of Procurement and

Property Management, USDA.

ACTION: Final rule.

SUMMARY: The Office of Procurement

and Property Management of the

Department of Agriculture (USDA)

amends its procedures for the donation

of excess research equipment for

technical and scientific education and

research activities to educational

institutions and nonprofit organizations

under section 11(i) of the StevensonWydler Technology Innovation Act of

1980 Act (15 U.S.C. 3710(i)). This

amendment expands the list of entities

eligible to receive such equipment,

establishes a priority list for eligible

entities seeking transfer of such

equipment, and clarifies administrative

rules regarding equipment transfer.

DATES: This final rule is effective

December 21, 2000.

FOR FURTHER INFORMATION CONTACT:

Kathy Fay on 202–720–9779.

SUPPLEMENTARY INFORMATION:

I. Background

II. Procedural Requirements

A. Executive Order Number 12866.

B. Regulatory Flexibility Act.

C. Paperwork Reduction Act.

III. Electronic Access Addresses

I. Background

USDA regulations for the donation of

excess research equipment for technical

and scientific educational research

activities under section 11(i) of the

Stevenson-Wydler Technology

Innovation Act of 1980 Act (15 U.S.C.

3710(i)) were promulgated at 60 FR

34456 on July 3, 1995. USDA

determined that the eligibility of

organizations to receive excess research

equipment under this part is not clear.

The President signed Executive Order

(EO) 12999 on April 17, 1996, requiring

Federal agencies, when donating

educationally useful Federal research

equipment under section 11(i) of the

Stevenson-Wydler Technology

Innovation Act of 1980 and other laws,

to give the highest preference to schools

(including pre-kindergarten through

twelfth grade) and nonprofit

organizations (including communitybased educational organizations) with

particular preference to such schools

and nonprofit organizations located in

Federal enterprise communities and

empowerment zones designated

pursuant to the Omnibus Reconciliation

Act of 1993, Public Law 103–66. USDA

is taking action in this rule making to

implement EO 12999.

Further, consistent with the EO 12999

and other authorities available to USDA

for transfer of excess personal property

(such as that implemented in 7 CFR part

3200), USDA desires to establish a

preference list for those eligible entities

seeking to receive property donated

under this part.

The substance of this rule was

published on July 29, 1999, as a

proposed rule. No comments were

received. The only change from the

proposed rule is the omission of a

current requirement (7 CFR 2812.4(e))

that recipients provide a written

justification for why the property is

needed. Since this change is de minus,

and actually reduces administrative

burdens on the public, the agency has

determined to proceed with a final rule

without further comment.

II. Procedural Requirements

A. Executive Order Number 12866

This rule was reviewed under EO

12866, and it has been determined that

it is not a significant regulatory action

because it will not have an annual effect

on the economy of $100 million or more

or adversely and materially affect a

sector of the economy, productivity,

competition, jobs, the environment,

public health or safety, or State, local or