[Federal Register Volume 63, Number 78 (Thursday, April 23, 1998)]
[Rules and Regulations]
[Pages 20056-20058]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-10772]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 932

[Docket No. FV98-932-1 FR]


Olives Grown in California; Increased Assessment Rate

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

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SUMMARY: This rule increases the assessment rate established for the 
California Olive Committee (Committee) under Marketing Order No. 932 
for the 1998 and subsequent fiscal years from $14.99 to $17.10 per ton 
of assessable olives. The Committee is responsible for local 
administration of the marketing order which regulates the handling of 
olives grown in California. Authorization to assess olive handlers 
enables the Committee to incur expenses that are reasonable and 
necessary to administer the program. The fiscal year began on January 1 
and ends December 31. The assessment rate will remain in effect 
indefinitely unless modified, suspended, or terminated.

EFFECTIVE DATE: April 24, 1998.

FOR FURTHER INFORMATION CONTACT: Diane Purvis, Marketing Assistant, or 
J. Terry Vawter, Marketing Specialist, California Marketing Field 
Office, Fruit and Vegetable Programs, AMS, USDA, 2202 Monterey Street, 
Suite 102B, Fresno, California 93721; telephone: (209) 487-5901, Fax: 
(209) 487-5906; or George Kelhart, Technical Advisor, Marketing Order 
Administration Branch, Fruit and Vegetable Programs, AMS, USDA, room 
2525-S, PO Box 96456, Washington, DC 20090-6456; telephone: (202) 720-
2491, Fax: (202) 205-6632. Small businesses may request information on 
compliance with this regulation by contacting Jay Guerber, Marketing 
Order Administration Branch, Fruit and Vegetable Programs, AMS, USDA, 
room 2525-S, PO Box 96456, Washington, DC 20090-6456; telephone: (202) 
720-2491, Fax: (202) 205-6632.

SUPPLEMENTARY INFORMATION: This rule is issued under Marketing 
Agreement No. 148 and Order No. 932, both as amended (7 CFR part 932), 
regulating the handling of olives grown in California, 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 of Agriculture (Department) is issuing this rule in 
conformance with Executive Order 12866.
    This rule has been reviewed under Executive Order 12988, Civil 
Justice Reform. Under the marketing order now in effect, California 
olive handlers are subject to assessments. Funds to administer the 
order are derived from such assessments. It is intended that the 
assessment rate as issued herein will be

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applicable to all assessable olives beginning January 1, 1998, 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 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. Such 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.
    This rule increases the assessment rate established for the 
Committee for the 1998 and subsequent fiscal years from $14.99 per ton 
to $17.10 per ton.
    The California olive marketing order provides authority for the 
Committee, with the approval of the Department, 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 
California olives. 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 1997 and subsequent fiscal years, the Committee 
recommended, and the Department approved, an assessment rate that would 
continue in effect from fiscal year to fiscal year unless modified, 
suspended, or terminated by the Secretary upon recommendation and 
information submitted by the Committee or other information available 
to the Secretary.
    The Committee met on December 11, 1997, and unanimously recommended 
1998 expenditures of $1,750,400 and an assessment rate of $17.10 per 
ton of olives received during the 1997-98 crop year, which began August 
1, 1997, and ends July 31, 1998. In comparison, last year's budgeted 
expenditures were $2,159,265. The assessment rate of $17.10 is $2.11 
higher than the rate currently in effect.
    Olive trees have an alternate-bearing characteristic causing a 
large crop one year and a small crop the next. Handler receipts of 
olives for the 1997-98 crop year were 85,585 tons, which is 41 percent 
less than the 144,075 tons received in 1996-97. Although the 1998 
fiscal year budgeted expenditures are less than those in the prior 
year, the decrease in olive receipts necessitates an increase in the 
assessment rate to cover all anticipated expenditures. If the 
assessment rate is not increased from the 1997 fiscal year assessment 
rate of $14.99, funds will fall approximately $467,481 short of 1998 
fiscal year budgeted expenses.
    The major expenditures recommended by the Committee for the 1998 
year include $357,900 for administration, $50,000 for research, and 
$1,308,500 for market development. Budgeted expenses for these items in 
1997 were $390,890, $173,375, and $1,595,000, respectively.
    The assessment rate recommended by the Committee was derived by 
considering anticipated expenses, actual receipts of olives, and 
additional pertinent factors. The revised assessment rate should 
provide $1,463,504 in assessment income. Income derived from handler 
assessments, interest, and carryover of reserve funds will be adequate 
to cover budgeted expenses. Funds in the reserve (currently $287,996) 
will be kept within the maximum permitted by the order (approximately 
one fiscal year's expenses; Sec. 932.40).
    The assessment rate established in this rule will continue in 
effect indefinitely unless modified, suspended, or terminated by the 
Secretary upon recommendation and information submitted by the 
Committee or other available information.
    Although this assessment rate will be in effect for an indefinite 
period, the Committee will continue to meet prior to or during each 
fiscal year to recommend a budget of expenses and consider 
recommendations for modification of the assessment rate. The dates and 
times of Committee meetings are available from the Committee or the 
Department. Committee meetings are open to the public and interested 
persons may express their views at these meetings. The Department will 
evaluate Committee recommendations and other available information to 
determine whether modification of the assessment rate is needed. 
Further rulemaking will be undertaken as necessary. The Committee's 
1998 budget was approved on February 17, 1998, and those for subsequent 
fiscal years will be reviewed and, as appropriate, approved by the 
Department.
    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA), the Agricultural Marketing Service (AMS) has considered the 
economic impact of this rule on small entities. Accordingly, AMS has 
prepared this final regulatory flexibility analysis.
    The purpose of the RFA is to fit regulatory actions to the scale of 
business subject to such actions in order that small businesses will 
not be unduly or disproportionately burdened. Marketing orders issued 
pursuant to the Act, and the rules issued thereunder, are unique in 
that they are brought about through group action of essentially small 
entities acting on their own behalf. Thus, both statutes have small 
entity orientation and compatibility.
    There are approximately 1,200 producers of olives in the production 
area and 4 handlers subject to regulation under the marketing order. 
Small agricultural producers have been defined by the Small Business 
Administration (13 CFR 121.601) as those having annual receipts less 
than $500,000, and small agricultural service firms are defined as 
those whose annual receipts are less than $5,000,000. The majority of 
California olive producers may be classified as small entities. None of 
the handlers may be so classified.
    This rule increases the assessment rate established for the 
Committee and collected from handlers for the 1998 and subsequent 
fiscal years from $14.99 per ton of olives to $17.10 per ton of olives. 
The Committee unanimously recommended 1998 expenditures of $1,750,400 
and an assessment rate of $17.10 per ton of olives. The assessment rate 
of $17.10 is $2.11 higher than the 1997 rate. The $17.10 rate should 
provide $1,463,504 in assessment income. The Committee will use reserve 
funds and interest income to make up the shortfall in assessment 
income. Therefore, income derived from handler assessments, interest, 
and carried over reserve funds will be adequate to cover budgeted 
expenses for the 1998 fiscal period. Funds in the reserve (currently 
$287,996) will be kept within the maximum permitted by the order 
(approximately one fiscal year's expenses; Sec. 932.40).
    Although the 1998 fiscal year budgeted expenditures are less than 
those in the prior year, the decrease in olive receipts necessitates an 
increase in the assessment rate to cover all anticipated expenditures. 
If the

[[Page 20058]]

assessment rate is not increased from the 1997 fiscal year assessment 
rate of $14.99, funds will fall approximately $467,481 short of 1998 
fiscal year budgeted expenses.
    A review of historical and preliminary information pertaining to 
the current crop year indicates that the grower prices for the 1997-98 
crop year could range from $150 to $825 per ton of olives for canning 
sizes. Therefore, the estimated assessment revenue for the 1998 fiscal 
year as a percentage of total grower revenue could range between 11.4 
and 2 percent, respectively. If the prices for canning sizes average 
about $500 per ton during the 1997-98 crop year, the estimated 
assessment revenue for the 1998 fiscal year as a percentage of total 
grower revenue will be about 3 percent.
    This action increases 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 
will be offset by the benefits derived by the operation of the 
marketing order. In addition, the Committee's meeting was widely 
publicized throughout the California olive industry and all interested 
persons were invited to attend the meeting and participate in Committee 
deliberations on all issues. Like all Committee meetings, the December 
11, 1997, meeting was a public meeting and all entities, both large and 
small, were able to express views on this issue. In addition, all four 
regulated handlers are equally represented on the Committee and voted 
unanimously in favor of the assessment increase. Finally, interested 
persons were invited to submit information on the regulatory and 
information impacts of this rule on small entities.
    This rule imposes no additional reporting or recordkeeping 
requirements on California olive handlers, none of which are small 
entities. 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 Department has not identified any relevant Federal rules that 
duplicate, overlap, or conflict with this rule.
    A proposed rule concerning this action was published in the Federal 
Register on February 17, 1998 (63 FR 7732). Copies of the proposed rule 
were also mailed or sent via facsimile to all olive handlers. Finally, 
the proposal was made available through the Internet by the Office of 
the Federal Register.
    A 30-day comment period ending March 19, 1998, was provided for 
interested persons to respond to the proposal. No comments were 
received in response to the proposal.
    After consideration of all relevant material presented, including 
the information and recommendation submitted by the Committee and other 
available information, it is hereby found that this rule, as 
hereinafter set forth, will tend to effectuate the declared policy of 
the Act.
    Pursuant to 5 U.S.C. 553, it also found and determined that good 
cause exists for not postponing the effective date of this rule until 
30 days after publication in the Federal Register because the marketing 
order requires that the rate of assessment for each fiscal period apply 
to all assessable olives handled during such period. The fiscal year 
under the order covers the period January 1 through December 31. 
Further, handlers are aware of this rule which was recommended at a 
public meeting. Also, a 30-day comment period was provided in the 
proposed rule, and no comments were received.

List of Subjects in 7 CFR Part 932

    Marketing agreements, Olives, Reporting and recordkeeping 
requirements.
    For the reasons set forth in the preamble, 7 CFR part 932 is 
amended as follows:

PART 932--OLIVES GROWN IN CALIFORNIA

    1. The authority citation for 7 CFR part 932 continues to read as 
follows:

    Authority: 7 U.S.C. 601-674.

    2. Section 932.230 is revised to read as follows:


Sec. 932.230  Assessment rate.

    On and after January 1, 1998, an assessment rate of $17.10 per ton 
is established for assessable olives grown in California.

    Dated: April 9, 1998.
Robert C. Keeney,
Deputy Administrator, Fruit and Vegetable Programs.
[FR Doc. 98-10772 Filed 4-22-98; 8:45 am]
BILLING CODE 3410-22-P