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

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REGISTER issue of each week.

Rules and Regulations Federal Register

61589 

Vol. 75, No. 193 

Wednesday, October 6, 2010 

1Carmen, C., L. Li, R. Sexton, An Economic 

Evaluation of the Hass Avocado Promotion Order’s 

First Five Years, p. 72. 

DEPARTMENT OF AGRICULTURE 

Agricultural Marketing Service 

7 CFR Part 1219 

[Document Number AMS–FV–10–0007] 

Hass Avocado Promotion, Research, 

and Information Order; Section 610 

Review 

AGENCY: Agricultural Marketing Service. 

ACTION: Confirmation of regulations. 

SUMMARY: This document summarizes 

the results of an Agricultural Marketing 

Service (AMS) review of the Hass 

Avocado Promotion, Research, and 

Information Order (Order) under criteria 

contained in section 610 of the 

Regulatory Flexibility Act (RFA). 

ADDRESSES: Interested persons may 

obtain a copy of the review on the 

Internet at: http://www.regulations.gov 

or request copies from the Docket Clerk, 

Research and Promotion Branch, Fruit 

and Vegetable Programs, AMS, USDA, 

1400 Independence Avenue, SW., Room 

0632–S, Stop 0244, Washington, DC 

20250–0244; facsimile: (202) 205–2800 

or electronic mail: 

Maureen.Pello@ams.usda.gov. 

FOR FURTHER INFORMATION CONTACT: 

Maureen T. Pello, Marketing Specialist, 

Research and Promotion Branch, Fruit 

and Vegetable Programs, AMS, USDA, 

P.O. Box 831, Beavercreek, Oregon 

97004; telephone: (503) 632–8848; 

facsimile (503) 632–8852; or electronic 

mail: Maureen.Pello@ams.usda.gov. 

SUPPLEMENTARY INFORMATION: The Order 

(7 CFR part 1219) is authorized under 

the Hass Avocado Promotion, Research 

and Information Act of 2000 (Act) (7 

U.S.C. 7801–7813). 

The Order became effective on 

September 9, 2002. The Order is 

administered by the Hass Avocado 

Board (Board) with oversight by AMS. 

The program is funded by assessments 

on fresh domestic and imported Hass 

avocados. Domestic producers and 

importers pay the assessments. The 

producer assessment is remitted by first 

handlers, and the importer assessment 

is remitted by the U.S. Customs and 

Border Protection. Exports of domestic 

Hass avocados are exempt from 

assessments. The purpose of the 

program is to increase consumption of 

Hass avocados in the United States. 

Under the Order, a State association 

of avocado producers receives 85 

percent of the assessments paid by 

domestic producers, and certified 

importer associations receive 85 percent 

of the assessments paid by their 

members. The State and importer 

associations use these funds to conduct 

State-of-origin and country-of-origin 

promotions, respectively. 

The Board is composed of 12 

members, 7 who are producers and 5 

who are importers. Each member has an 

alternate. The members and alternates 

are appointed to the Board by the 

Secretary of Agriculture (Secretary) and 

serve a term of 3 years. 

Currently, there are approximately 

6,000 producers of Hass avocados in the 

United States, approximately 115 

importers, and approximately 100 first 

handlers subject to the provisions of the 

Order. The majority of domestic 

producers and importers of Hass 

avocados may be classified as small 

entities, while most first handlers would 

not. 

AMS published in the Federal 

Register on March 24, 2006 (71 FR 

14827), its plan to review certain 

regulations, including the Order, under 

criteria contained in section 610 of the 

RFA (5 U.S.C. 601–612). Because many 

AMS regulations impact small entities, 

AMS decided, as a matter of policy, to 

review certain regulations which, 

although they may not meet the 

threshold requirement under section 

610 of the RFA, warrant review. 

AMS published a notice of review and 

request for written comments in the 

Federal Register on February 23, 2010 

(75 FR 7986) on its plan to review 

certain regulations, including the Order. 

The comment period ended on April 26, 

2010. Three comments were received in 

response to the notice and are discussed 

later in this document. 

The purpose of the review was to 

determine whether the Order should be 

continued without change, amended, or 

rescinded (consistent with the 

objectives of the Act) to minimize the 

impact on small entities. AMS 

considered the following factors: (1) The 

continued need for the Order; (2) the 

nature of complaints or comments 

received from the public concerning the 

Order; (3) the complexity of the Order; 

(4) the extent to which the Order 

overlaps, duplicates, or conflicts with 

other Federal rules, and, to the extent 

feasible, with State and local 

regulations; and (5) the length of time 

since the Order has been evaluated or 

the degree to which technology, 

economic conditions, or other factors 

have changed in the area affected by the 

Order. 

Based upon its review, USDA has 

concluded that there is a continued 

need for the Order. The total volume of 

Hass avocados produced domestically 

and imported into the United States has 

grown significantly since the inception 

of the Order. From 2003 through 2005, 

Hass avocado domestic production and 

imports averaged about 712 million 

pounds annually. From 2007 through 

2009, Hass avocado domestic 

production and imports averaged about 

1 billion pounds annually. Through the 

efforts of the Board and State and 

importer associations which receive 

assessments funds from the Board, the 

industry has worked together to 

successfully grow the demand for Hass 

avocados. Between 1998 and 2007, the 

average annual growth for U.S. 

consumption for avocados was 13.2 

percent with producer prices remaining 

fairly constant.1 The Board and State 

and importer association promotion 

programs have significantly helped to 

increase demand and maintain orderly 

marketing since the Order’s inception. 

Regarding the nature of complaints or 

comments received from the public 

concerning the Order, as previously 

mentioned, three comments were 

received. They are discussed in the 

following paragraphs. 

One comment supported the 

marketing efforts under the program, but 

expressed concern with the rising costs 

that California growers are experiencing, 

especially costs for water. The comment 

suggested that the Order be revised to 

provide for a sliding scale for 

assessments so that avocados up to a 

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61590 Federal Register / Vol. 75, No. 193 / Wednesday, October 6, 2010 / Rules and Regulations 

certain threshold amount would be 

assessed at a lower rate than avocados 

over the threshold. However, the Act 

authorizes only uniform assessment 

rates. 

Two comments expressed concern 

with the Board’s composition. They 

stated that, on the 12 member Board, 7 

seats are for domestic producers and a 

maximum of 5 seats are for importers, 

regardless of shifts in the volume of 

Hass avocados produced domestically 

or imported into the United States. They 

also expressed concern that foreign 

producers and packers are not 

represented on the Board as in some 

other research and promotion programs. 

The composition of the Board is set 

forth in the provisions of the Act and 

Order which provide that the Board 

shall consist of seven members who are 

domestic producers of Hass avocados 

who are subject to assessment under the 

Order and two members who represent 

importers of Hass avocados who are 

subject to assessment under the Order. 

The Board shall also consist of three 

members who are either domestic 

producers or importers to reflect the 

proportion of domestic production and 

imports supplying the United States 

market, depending on the average 

volume of domestic production of Hass 

avocados proportionate to the average 

volume of imports of Hass avocados in 

the United States over the previous 3 

years. While the initial Board consisted 

of eight domestic producer members 

and four importer members, the current 

Board’s membership consists of seven 

members who are domestic producers 

and five members who are importers, 

the maximum number of seats 

authorized for importers. 

Two comments expressed concern 

that the importer associations under the 

Order cannot use assessment funds to 

pay administrative expenses incurred by 

the associations while the Board can 

spend up to 10 percent of the projected 

level of assessments and other income 

received by the Board for a fiscal period 

to pay administrative expenses. The 

commenters argue this is unfair and that 

other Federal promotion boards can use 

assessment funds to pay administrative 

expenses. However, the Act and Order 

specify that assessment funds shall not 

be used by importer associations to pay 

administrative expenses for such 

associations, which is also consistent 

with the provision for the domestic 

State association. 

Two comments expressed concern 

that the existing State association under 

the Order receives the full 85 percent of 

the assessments paid by domestic 

producers while the importer 

associations receive 85 percent of the 

assessments paid by their respective 

association members. 

The Act and Order specify that a State 

organization of avocado producers 

established pursuant to State law shall 

receive an amount equal to the product 

obtained by multiplying the aggregate 

amount of assessments attributable to 

the pounds of Hass avocados produced 

in such State by 85 percent. The State 

organization (association) under the 

Order is authorized under the California 

Food and Agricultural Code. 

The Act and Order also specify that 

an association of Hass avocado 

importers established or certified under 

the Order shall receive an amount of 

assessment funds equal to 85 percent of 

the assessments paid on Hass avocados 

imported by its members. However, not 

all Hass avocado importers have joined 

or are affiliated with an importers 

association. Additionally, the Order’s 

promulgation rulemaking record 

indicated that requiring all importers to 

join an association is not authorized 

under the Act. USDA believes that 

additional dialogue with the industry 

may be appropriate to consider possible 

solutions that would be consistent with 

the Act in order to address this issue. 

One comment expressed concern that 

the Board is required to enter into a 

contract with the State association 

under the Order to manage its 

promotional program that is funded 

primarily by assessments from 

importers. 

The Act and Order specify that the 

Board, with approval of the Secretary, 

shall enter into a contract or an 

agreement with an avocado organization 

established by State statute in a State 

with the majority of Hass avocado 

production in the United States, for the 

implementation of a plan or project for 

promotion, industry information, 

consumer information, or related 

research with respect to Hass avocados, 

and/or the payment of the costs of the 

contract or agreement with funds 

received by the Board under the Order. 

One comment expressed concern with 

the referendum criteria specified in the 

Act and Order. The comment argues 

that, although a majority of the 

assessments are paid by importers of 

Hass avocados, the referendum 

procedures were designed to give 

domestic producers a permanent 

majority in a referendum. Further, the 

comment contends that, even if a 

referendum were held to address some 

of their concerns, no relief would be 

provided to importers. 

The Act and Order specify that the 

Order, or an amendment thereto, must 

be approved by a simple majority of all 

votes cast in a referendum. Changing the 

referendum criteria is not authorized 

under the Act. 

One commenter expressed concern 

that the Board’s composition violates 

the North American Free Trade 

Agreement (NAFTA), and that the 85 

percent provision violates the NAFTA 

and the General Agreement on Tariff 

and Trade. USDA continues to view 

these provisions as consistent with 

applicable trade obligations. 

In considering the complexity of the 

Order, USDA also continues to believe 

the Order is not unduly complex. It 

provides authority for the Board to 

collect assessments from Hass avocado 

domestic producers and importers to 

fund programs to help increase the 

consumption of Hass avocados in the 

United States. 

Regarding whether the Order 

overlaps, duplicates, or conflicts with 

other Federal rules and State and local 

regulations, there is a Federal marketing 

order for avocados grown in south 

Florida (7 CFR part 915). According to 

the National Agricultural Statistics 

Service, there is little or no production 

of Hass avocados in Florida. Since 

California is the source for more than 95 

percent of avocados produced in the 

United States and Florida does not 

produce Hass avocados, there is no 

duplication between this Order and the 

Federal marketing order. 

As previously mentioned, there is also 

a State avocado program in California, 

which is administered by the State 

association. The chief objective of the 

program is to increase consumer 

awareness of and demand for avocados 

on behalf of the State’s 6,000 producers. 

Under the program, producers pay a 

percentage-of-revenue fee to fund a 

variety of market development 

programs. The State assessment may not 

exceed 6.5 percent of the gross dollar 

value of the year’s sales of avocados by 

all producers to handlers, or which are 

sold by handlers on behalf of producers. 

The assessments are collected from the 

producers by handlers, who remit the 

money to the association. Section 

1212(c) of the Act states that nothing 

may be construed to preempt or 

supersede any other program relating to 

Hass avocado promotion, research, 

industry information, and consumer 

information organized and operated 

under the laws of the United States or 

of a state. The Federal program 

compliments the State program but does 

not overlap, duplicate or conflict with 

it. 

Regarding evaluations of the Order or 

the degree to which technology, 

economic conditions, or other factors 

have changed in the area affected by the 

Order, section 1205(c)(7) of the Act and 

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Federal Register / Vol. 75, No. 193 / Wednesday, October 6, 2010 / Rules and Regulations 61591 

§ 1219.38(k) of the Order require the 

Board to evaluate on-going and 

completed programs, plans, and projects 

for Hass avocado promotion, industry 

information, consumer information, or 

related research and to comply with the 

independent evaluation provisions of 

the Federal Agricultural Improvement 

and Reform Act of 1996 (FAIR). The 

Board routinely evaluates its programs 

to ensure their effectiveness, and a 

formal evaluation was conducted under 

the FAIR in 2009. 

Accordingly, USDA has determined 

that the Hass avocado Order should be 

continued. The Order was established to 

help increase the consumption of 

domestic and imported Hass avocados 

in the United States. Concerns raised in 

the comments received were to a great 

extent changes that would require 

congressional action. AMS will 

continue to work with the Hass avocado 

industry in maintaining an effective 

program. 

Dated: October 1, 2010. 

Rayne Pegg, 

Administrator. 

[FR Doc. 2010–25130 Filed 10–5–10; 8:45 am] 

BILLING CODE 3410–02–P 

SMALL BUSINESS ADMINISTRATION 

13 CFR Part 121 

RIN 3245–AF70 

Small Business Size Standards; Other 

Services. 

AGENCY: U.S. Small Business 

Administration. 

ACTION: Final rule. 

SUMMARY: The United States Small 

Business Administration (SBA) is 

increasing the small business size 

standards for 18 industries in North 

American Industry Classification 

System (NAICS) Sector 81, Other 

Services, and retaining the current 

standards for the remaining 30 

industries in the Sector. As part of its 

ongoing initiative to review all size 

standards, SBA has evaluated every 

industry in NAICS Sector 81 to 

determine whether the existing size 

standards should be retained or revised. 

DATES: This rule is effective November 

5, 2010. 

FOR FURTHER INFORMATION CONTACT: Carl 

Jordan, Program Analyst, Office of Size 

Standards, (202) 205–6618 or 

sizestandards@sba.gov. 

SUPPLEMENTARY INFORMATION: 

Introduction 

To determine eligibility for Federal 

small business assistance programs, 

SBA establishes small business size 

definitions (referred to as size 

standards) for private sector industries 

in the United States. SBA’s existing size 

standards use two primary measures of 

business size—receipts and number of 

employees. Financial assets, electric 

output and refining capacity are used as 

size measures for a few specialized 

industries. In addition, SBA’s Small 

Business Investment Company (SBIC) 

and the Certified Development 

Company (CDC) Programs determine 

small business eligibility using either 

the industry based size standards or net 

worth and net income size standards. 

Currently, SBA’s size standards consist 

of 45 different size levels, covering 

1,141 NAICS industries and 17 subindustry activities. Of these size levels, 

32 are based on average annual receipts, 

eight are based on number of 

employees, and five are based on other 

measures. In addition, SBA has 

established 11 other size standards for 

its financial and procurement programs. 

Over the years, SBA has received 

comments that its size standards have 

not kept up with changes in the 

economy and, in particular, that they do 

not reflect changes in the Federal 

contracting marketplace. The last 

overall review of size standards 

occurred during the late 1970s and early 

1980s. Since then, most reviews of size 

standards have been limited to in-depth 

analyses of specific industries in 

response to requests from the public and 

Federal agencies. SBA also makes 

periodic inflation adjustments to its 

monetary based size standards. The 

latest inflation adjustment to size 

standards was published in the Federal 

Register on July 18, 2008 (73 FR 41237). 

SBA recognizes that changes in 

industry structure and the Federal 

marketplace over time have rendered 

existing size standards for some 

industries no longer supportable by 

current data. Accordingly, SBA has 

begun a comprehensive review of its 

size standards to determine whether 

existing size standards have supportable 

bases relative to the current data, and, 

where necessary, to make revisions to 

current size standards. Rather than 

review all size standards at one time, 

SBA has taken a more manageable 

approach to reviewing a group of related 

industries within an NAICS Sector in 

phases. SBA expects to complete its 

review of all NAICS Sectors in two 

years. 

As part of its ongoing effort to review 

all small business size standards, SBA 

evaluated every industry in NAICS 

Sector 81, Other Services, to determine 

whether the existing size standards 

should be retained or revised, and 

published a proposed rule for public 

comment in the October 21, 2009 issue 

of Federal Register (74 FR 53941) to 

increase the standards for 18 industries 

in that Sector. The proposed rule was 

one of a series of proposals that will 

examine industries grouped by an 

NAICS Sector. SBA also published 

concurrently in the same October 21, 

2009 issue of the Federal Register 

proposed rules to increase 47 small 

business size standards in NAICS Sector 

44–45, Retail Trade, (74 FR 53924) and 

five standards in NAICS Sector 72, 

Accommodation and Food Services (74 

FR 53913). Similarly, SBA is publishing 

final rules on NAICS Sector 44–45 and 

NAICS Sector 72 elsewhere in this issue 

of the Federal Register. 

In addition, SBA established its ‘‘Size 

Standards Methodology’’ for reviewing 

small business size standards and 

modifying them, where necessary. SBA 

published in the October 21, 2009 issue 

of the Federal Register (74 FR 53940) a 

notice of its availability, for public 

comments, on SBA’s Web site at 

http://www.sba.gov/ 

contractingopportunities/officials/size/ 

index.html. In addition, SBA has placed 

a copy of its ‘‘Size Standards 

Methodology’’ in the electronic docket 

of this rule on 

http://www.regulations.gov and is 

available there as well. 

In evaluating an industry’s size 

standard, SBA examines the industry’s 

characteristics (such as average firm 

size, startup costs, industry competition 

and distribution of firms by size), 

Federal government contracting trends, 

impact on SBA financial assistance 

programs, and dominance in field of 

operations. SBA analyzed the 

characteristics of each industry in 

NAICS Sector 81 mostly using a special 

tabulation obtained from the U.S. 

Bureau of the Census from its 2002 

Economic Census (the latest available). 

SBA evaluated Federal contracting 

trends in that Sector using the data from 

the Federal Procurement Data System— 

Next Generation (FPDS–NG) for fiscal 

years 2006–2008. To evaluate the 

impact of changes to size standards on 

its loan programs, SBA analyzed 

internal data on its guaranteed loan 

programs for fiscal years 2006–2008. 

SBA’s ‘‘Size Standards Methodology’’ 

provides a detailed description of 

analyses of various industry and 

program factors and data sources and 

derivation of size standards using the 

results. In the proposed rule itself, SBA 

detailed how it applied its ‘‘Size 

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