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

33523

Vol. 63, No. 118

Friday, June 19, 1998

DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 930

[Docket No. FV97–930–2 FR]

Tart Cherries Grown in the States of

Michigan, et al.; Establishment of

Rules and Regulations for Grower

Diversion and a Compensation Rate

for the Cherry Industry Administrative

Board Public Member and Alternate

Public Member

AGENCY: Agricultural Marketing Service,

USDA.

ACTION: Final rule.

SUMMARY: This rule establishes rules

and regulations for a grower diversion

program under the tart cherry marketing

order for the 1998–1999 and following

crop years. It also establishes a

compensation rate to be paid to the

Cherry Industry Administrative Board

(Board) public member and/or alternate

public member when attending Board

meetings.

EFFECTIVE DATE: This rule becomes

effective June 20, 1998.

FOR FURTHER INFORMATION CONTACT:

Patricia A. Petrella or Kenneth G.

Johnson, Marketing Order

Administration Branch, F&V, AMS,

USDA, room 2525–S, P.O. Box 96456,

Washington, DC 20090–6456, telephone:

(202) 720–5053, Fax: (202) 720–5698.

Small businesses may request

information on compliance with this

regulation by contacting: Jay Guerber,

Marketing Order Administration

Branch, Fruit and Vegetable Programs,

AMS, USDA, P.O. Box 96456, room

2525–S, Washington, DC 20090–6456;

telephone (202) 720–2491; Fax: (202)

720–5698.

SUPPLEMENTARY INFORMATION: This final

rule is issued under Marketing

Agreement and Order No. 930 (7 CFR

Part 930), regulating the handling of tart

cherries grown in the States of

Michigan, New York, Pennsylvania,

Oregon, Utah, Washington, and

Wisconsin, 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. This rule is not intended to

have retroactive effect. This rule would

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.

This final rule establishes rules and

regulations for grower diversion under

the tart cherry marketing order and also

establishes a compensation rate of $250

per meeting for the public member and

alternate public member when attending

Board meetings. The tart cherry

marketing order became effective in

September of 1996 and the Board met

March 12–13, June 26–27, September

11–12, 1997, and January 29–30, 1998,

to establish and recommend to the

Secretary rules and regulations to

implement order authorities. At its

meetings, the Board recommended

grower diversion regulations and a

compensation rate for the public

member and alternate public member to

the Department for appropriate action.

An interim final rule was published

in the Federal Register on August 25,

1997, to establish terms and conditions

for the issuance of grower diversion

certificates for the 1997–1998 crop

season. A final rule was published on

April 22, 1998, in the Federal Register.

A proposed rule establishing the grower

diversion program for the 1998–99 and

following crop years was published in

the Federal Register on April 23, 1998,

(63 FR 20274). This final rule contains

the terms and conditions for the grower

diversion program to be used for 1998–

1999 and subsequent crop years.

Section 930.33 of the order authorizes

the Board to compensate the public

member and/or alternate public member

for performance of their duties. The

Board at its discretion may request the

attendance of the alternate public

member at any or all meetings,

notwithstanding the expected or actual

presence of the public member. The

$250 compensation rate will allow the

Board to compensate the public member

and alternate public member for

attending Board meetings. Such

compensation is a per meeting rate. For

example, if a Board meeting is convened

and lasts four days or four hours, the

public member and/or alternate public

member attending the meeting will

receive $250. This action is intended to

compensate them for loss of work and

wages. This payment will be in addition

to compensation for travel, lodging,

meals, and other related costs incurred

in attending public Board meetings.

The order in section 930.50 provides

the method of establishing an optimum

supply level of cherries for the crop

year. The optimum supply is defined as

the average of the prior three years’ sales

of tart cherries, adjusted for carry-in and

desired carry-out inventory. The

optimum supply consists of a free

percentage amount of cherries which a

handler could sell to any market and a

restricted percentage amount, when

warranted, which would have to be

withheld from the market. Based on the

optimum supply level, the Board

establishes preliminary free and

restricted percentages. No later than

September 15, after harvesting and

processing of the crop, the Board

computes and recommends to the

Secretary final free and restricted

percentages based on actual crop
33524 Federal Register / Vol. 63, No. 118 / Friday, June 19, 1998 /Rules and Regulations

amounts. After receiving the Board’s

recommendation, the Secretary

designates the final free and restricted

percentages through informal

rulemaking if he finds that such action

would tend to effectuate the purposes of

the Act. The difference between any

final free market percentage and 100

percent is the final restricted

percentage. The Board established an

optimum supply of 247 million pounds

and preliminary free and restricted

percentages for tart cherries acquired by

handlers during the 1997–98 crop year

during its June 26–27, 1997, meeting.

Final free and restricted percentages

which were recommended by the Board

to the Secretary were established during

its September 11–12, 1997, meeting. A

final rule setting the final free and

restricted percentages for the 1997–98

crop year at 55 percent and 45 percent,

respectively, was published in the

Federal Register on April 27, 1998, (63

FR 20522).

Handlers can satisfy their restricted

percentage in various ways. The

restricted percentage cherries can be

maintained in handler-owned inventory

reserve pools. Handlers can also satisfy

restricted percentage obligations by

redeeming grower diversion certificates,

exporting cherries to designated

countries, shipping to exempt outlets,

contributing to charitable organizations

or diverting cherries at the handler’s

facility.

The maximum volume of cherries that

can be held in the primary inventory

reserve is 50 million pounds. Handlers

can establish a secondary inventory

reserve after the primary inventory

reserve has reached its maximum

volume. There is no maximum volume

in the secondary inventory reserve. Each

handler establishing a reserve (primary

and secondary) is required to pay all of

his or her own storage expenses.

Reserve cherries can be released for sale

upon Board approval into commercial

outlets when the current crop is not

expected to fill demand.

Section 930.58 of the tart cherry

marketing order provides authority for

voluntary grower diversion. Growers

can divert all or a portion of their

cherries which otherwise, upon delivery

to a handler, would become restricted

percentage cherries. Growers will

receive diversion certificates from the

Board stating the weight of cherries

diverted. The grower could then present

this certificate to a handler in lieu of

actual cherries. The handler could apply

the weight of cherries represented by

the certificate against the handler’s

restricted percentage amount. In

comments concerning the 1997–98

grower diversion program there were

concerns that such program could act as

an insurance policy for cherries that are

not marketable contrary to the intent of

the order. The overall intent of the order

is that only cherries that have reached

a harvestable, marketable condition be

allowed to be diverted. Therefore, in

order to further clarify this concept, this

rule will provide that the Board will not

allow diversion credit to a grower

whose fruit was destroyed before it set

and/or matured on the tree, or whose

fruit is unmarketable. If marketable fruit

were to be damaged or destroyed by acts

of nature such as storms or hail,

diversion credit could be granted.

A new section 930.158 is added to the

rules and regulations specifying the

guidelines for grower diversion for the

1998–99 and subsequent crop years.

First, any grower desiring to divert in

the orchard would need to request an

application form from the Board and

would need to apply by June 24, 1998,

for the 1998–99 crop year and by April

15 for subsequent crop years. The

proposed June 15, 1998, date is changed

in this final rule to June 24, 1998, to

allow growers adequate time to apply

for grower diversion for the 1998–99

crop year. The application will include

the name, address, phone number and a

signed statement certifying that the

grower will abide by all the rules and

regulations for diversion. In addition,

the grower will need to include maps of

such grower’s orchard. Each map will

include the grower’s name, address and

location of the orchard.

The Board has recommended four

types of in-orchard diversion. These are:

(1) random row diversion, in which

rows of cherry trees are randomly

selected by the Board’s computer

programs to remain unharvested; (2)

whole block diversion, in which an

entire orchard block is left unharvested;

(3) partial block diversion, in which a

contiguous portion of a definable block

is diverted; and (4) in-orchard tank

diversion, in which cherries harvested

into tanks are measured, calculated and

then diverted in the orchard. The

regulations for the 1997–98 crop year

only provide for random row and whole

block diversion.

For all types of diversion, except tank

diversion, growers will need to map

each orchard block they intend to

divert. A block is defined as a group of

trees that are of similar age, running in

the same direction and having definable

boundaries (e.g., roads, ditches). If a

grower desires to divert using the

random row method, all of the grower’s

orchards would need to be mapped,

since random row diversion involves

diverting a certain amount of trees from

all the grower’s orchards. If the grower

elects whole or partial block diversion,

all blocks to be diverted would need to

be mapped. The maps would need to be

supplied to the Board so that the Board

can calculate the diversion amounts.

New maps would not need to be

prepared each season. However, maps

would have to be updated to reflect any

substantive changes in the grower’s

orchard such as new trees or trees

destroyed by inclement weather.

For the 1998–99 and subsequent crop

years, the proposed rule provided that

only trees more than six years old

would qualify for diversion. Based on

information from the National

Agricultural Statistical Service (NASS),

and from record testimony, it appears

that tart cherry trees do not come into

full commercial production before they

are five to seven years old. Using trees

which are not producing cherries or

which are only beginning to come into

full production when calculating

diversion amounts would result in

figures which are not representative of

a grower’s true production. A comment

was received on this issue and will be

discussed later in this document as well

as the change in the regulations

concerning this matter.

By July 1 of each crop year in which

volume regulation is recommended, a

grower that has provided the Board with

the required orchard maps would have

to inform the Board of such grower’s

intention to divert in the orchard and

the method of diversion. If a grower

does not elect the method of diversion

by July 1, then only random row or inorchard tank diversion would be

available and the Board would provide

the information necessary for the grower

to divert by the random row method.

Random Row Diversion

Based on orchard maps submitted to

the Board by the grower, the Board,

using a computer program, would

randomly designate rows of trees in

each orchard block for nonharvest and

inform the grower of this designation.

This designation would be based upon

the preliminary restricted percentage

amount computed and announced by

the Board. For example, if the

preliminary restricted percentage is 20

percent, the Board’s computer would

randomly select rows of trees across all

blocks in the grower’s orchard to allow

the grower to divert 20 percent of such

grower’s crop. The grower, however,

would not have to choose this diversion

amount. No less than seven days prior

to each grower’s individual harvest date,

such grower could request a different

diversion percentage (either smaller or

greater). The purpose of the seven day

notice is to allow the Board adequate
Federal Register / Vol. 63, No. 118 / Friday, June 19, 1998 /Rules and Regulations 33525

time to prepare a different orchard map

using different percentages.

To divert cherries through random

row diversion, the grower will not

harvest the designated rows. After

completing harvest of all trees not

designated for diversion, the grower

would be required to notify the Board

and/or a Board compliance officer. Such

grower will also need to provide the

Board with total harvested production

amounts so the Board could calculate

the amount of grower diversion tonnage

to be placed on the diversion certificate.

Independent confirmation by the Board

of the grower’s production would also

be provided by the handler on Board

form number two.

Growers will receive diversion

certificates only after confirmation of

diversion is provided to the Board. After

harvest, the Board’s compliance staff

will visit the grower’s orchards to

ensure that the rows selected on the

orchard map for random row diversion

had not been harvested. Once the

orchard has been visited by a

compliance officer and the grower has

carried out the terms and conditions for

random row diversion, a diversion

certificate will be issued to the grower.

The diversion certificate will represent

the weight of cherries diverted by the

grower. The grower could then present

the certificate to a handler to be

redeemed.

Whole Block Diversion

Whole block diversion involves

diversion of the production from an

entire block of cherry trees.

In whole block diversion, the value of

the diversion would be determined by

application of a statistical sampling

protocol. For example, if a block has 5

rows or less, 3 rows would be randomly

chosen to be sampled. If a block has 6

to 15 rows, 4 rows would be randomly

chosen to be sampled. If a block has 16

or more rows, 5 rows would be

randomly chosen to be sampled.

The Board originally recommended

that a 5 percent sample size be used.

However, after the first season of

operation, the Board determined that

the statistical method of sampling

would be much more accurate in

obtaining the weight of what is to be

diverted. From each of the rows to be

sampled, ten contiguous originally

planted tree sites would be sampled

within the rows. A tree site is a planted

tree or an area where a tree was planted

and may have been uprooted or died.

Only trees over the age of six years old

would be harvested for the sample. For

example, if it is determined that five

rows are to be sampled, then 10 tree

sites in each of the five rows would be

sampled. A total of 50 tree sites would

be sampled ((10 original tree sites)×(5

rows)=50 trees). If a total of 4600

pounds is harvested from the sample

trees and this is divided by 50 tree sites,

a yield of 92 pounds per tree site will

be obtained. The yield for the block is

found by multiplying 92 pounds per site

by 880 trees that were mapped in the

block to yield 80,960 pounds per block.

The Board discussed another

sampling option. This would have

required that mapping be done by the

grower each year the grower applied for

diversion. However, the Board felt that

was an undue burden on the grower.

Using the sampling method

recommended by the Board will only

require the grower to map an orchard

one time and update the map, as

necessary, to reflect any substantive

changes in the grower’s orchard. The

grower will not need to redo the map

every year such grower may want to

divert.

Prior to sampling, the grower will

notify the Board to allow observation of

the sampling process by a compliance

officer. After harvest, the compliance

officer could again visit the grower’s

orchard to verify that diversion actually

took place.

A diversion certificate will be issued

for an amount equal to the volume of

cherries diverted by the grower. The

grower could then present the certificate

to a handler to be redeemed.

Partial Block Diversion

The Board recommended that partial

block diversion be available as an

option to growers. Inclusion of this

option would permit growers added

flexibility. Also, it would help

discourage the tendency of growers to

break up large blocks into multiple

small blocks. Partial block diversion

would also speed up the orchard

diversion activity by decreasing the

sampling time for growers and the

Board. Growers may wish to divert only

partial blocks of marketable, harvestable

cherries that have been subjected to

storm damage or are of lower quality.

For example, this will allow a grower

that has a block that is 35 rows by 40

trees per row to divert contiguous rows

1 through 22 and harvest rows 23

through 35. The partial block would be

sampled as in whole block diversion.

This provides the grower with more

options when determining if such

grower should in-orchard divert.

The Board recommended limiting

partial block diversions to one partial

block per grower per year. This will

alleviate the time that compliance

officers would need to spend observing

sampling and diversion at grower’s

premises. The Board may evaluate

partial block diversions at the end of the

season to decide if it is not timely or not

cost effective to administer by the

compliance officers. Based on this

evaluation the Board may recommend

increasing the number of partial block

diversions or eliminate this type of

diversion as an option to growers. The

grower should inform the Board by July

1 if such grower elects to whole or

partial block divert. If whole block or

partial block diversion is not selected by

July 1, growers who wish to divert could

then choose the random row method or

the in-orchard tank method of diversion.

In-Orchard Tank Diversion

The Board recommended that inorchard tank diversion be authorized to

growers as another option for diversion.

The Board discussed at length the fact

that the grower diversion program must

be grower friendly in order for growers

to take full advantage of the program.

Adding options to the grower diversion

program provides more flexibility to the

grower.

A grower diverting by this method

would need to notify the Board and

compliance officers of such diversion.

Growers may wish to use tank diversion

when marketable cherries in part of the

orchard have sustained damage or are of

lower quality. Such cherries could be

picked and placed in harvesting tanks

until a compliance officer could come to

the orchard to probe the tanks for

volume measurement and observe the

destruction of the cherries on the

grower’s premises.

To use this diversion option a grower

would need to inform a compliance

officer that such grower has tanks ready

for diversion. The Board recommended

that the grower have no fewer than 10

tanks for diversion prior to informing

the compliance officer. This will keep

the cost of inspections to a minimum

and decrease the compliance officer’s

time from traveling from location to

location to observe a small amount of

in-orchard tank diversion. The Board

discussed the fact that 10 tanks is not a

large amount, since each tank holds

about 1,000 pounds and 10 tanks would

be about a truckload of cherries. This

will not be an undue hardship on small

growers that wish to take advantage of

such diversion.

After the grower informs the

compliance officer of such diversion,

the compliance officer will have up to

five days to come to the grower’s

premises to probe the tanks and observe

the diversion. This will allow the

compliance officer the flexibility to

schedule visits throughout the area and

save compliance costs.
33526 Federal Register / Vol. 63, No. 118 / Friday, June 19, 1998 /Rules and Regulations

Compliance

In-orchard diversion by growers is a

voluntary action. However, once

chosen, growers are expected to meet all

of the terms and conditions for

diversion to receive a diversion

certificate and to be diligent in actually

diverting the percentage of the crop for

which they have applied. Handlers

depend upon growers to accurately

divert the percentages requested as they

make their marketing and storage

decisions throughout the season. Thus,

in the case where growers fail to

properly divert all of the cherries

specified in their application, such

growers should not receive diversion

credit for the undiverted cherries.

When a grower chooses random row

diversion, such grower would not

harvest trees in rows that have been

randomly chosen by the Board’s

computer programs, to be left

unharvested. Unintended errors could

occur during harvest that could void a

growers diversion efforts. The Board has

recommended that growers who choose

random row diversion should be

permitted to rectify any unintended

errors that may occur during harvest.

Therefore, growers who fail to properly

divert designated rows, but who

otherwise meet the terms and

conditions of diversion, will have to

divert cherries in addition to those

randomly chosen, but will still receive

the diversion percentage originally

applied for.

For example, a grower’s map could

require such grower to random row

divert rows 5 and 6 and such grower

may harvest row 5 in error. Such grower

will then be required to divert another

two rows to make up for the mistake in

diverting. This will discourage mistakes

being made in the orchard since such

growers know they may have to divert

more cherries to correct a mistake. This

recommended adjustment will allow a

grower to correct an error in the orchard

and still receive a diversion certificate.

However, if growers are harvesting at

the end of the orchard and thus, do not

have an opportunity to rectify a mistake

by diverting additional rows or trees,

the Board could reduce the grower’s

diversion certificate by using the two for

one method. For example, a grower

specifies a diversion amount of 20

percent on the original application for

diversion (and does not increase or

decrease such percentage by the June

24, 1998, cutoff date for the 1998–99

crop year and by April 15 for

subsequent crop years). Subsequently,

the grower fails to divert a complete

block or all of the specified rows,

resulting in diversion of only 16 percent

of the crop. Thus, the grower has failed

to divert an additional 4 percent of the

crop. The Board would then multiply

that percent by two and subtract that

amount from the original diversion

application amount. This would reduce

the diversion amount by twice the

amount of the mistake that was made

and therefore, a 2 for 1 reduction would

be made as explained above. In this

example, 2 times 4 percent equals 8

percent; which, when subtracted from

the original percentage of 20 percent,

yields a diversion credit of 12 percent

of the grower’s total production. Thus,

the grower would receive a diversion

certificate equal to 12 percent of the

originally requested amount.

Growers, when aware of such errors,

will need to immediately inform the

Board when such errors are made

during the diversion process to ensure

that they continue to meet the terms and

conditions of diversion. Growers who

divert more than their preliminary

percentage will not receive additional

diversion credit. The Department agrees

with this recommendation. The ‘‘two for

one’’ method is a necessary part of

compliance for the diversion provisions

because it is important that the industry

accurately projects the annual tonnage

of cherries available for market.

The Board recommended that all

grower diversion certificates should be

redeemed with handlers by November 1.

After November 1, grower diversion

certificates will not be valid. It was

intended that diversion certificates be

used within the same crop year that

they were issued, as if a crop had been

produced. The November 1 date will

allow handlers adequate time to meet

their restricted percentage amounts after

final percentages have been established.

Compensation

The Board also recommended adding

a new section 930.133 to provide a

compensation rate of $250 to be paid to

the public member and to the alternate

public member for each meeting they

attend. Section 930.33 provides that the

public member and alternate public

member shall receive such

compensation as the Board may

establish and the Secretary may

approve. The public and alternate

public member cannot have a financial

interest in the tart cherry industry. To

attend meetings, it may be necessary for

them to be absent from their places of

employment. Therefore, the Board

recommended a compensation rate be

established. This payment will be in

addition to compensation for travel,

lodging, meals, and other related costs

incurred in attending Board meetings.

For example, if a Board meeting is

convened and lasts for a day or two or

only four hours, the public member

and/or alternate public member

attending the meeting would receive

$250.

The Regulatory Flexibility Act and

Effects on Small Businesses

The Agricultural Marketing Service

(AMS) has considered the economic

impact of this action on small entities

and has prepared this final regulatory

flexibility analysis. The Regulatory

Flexibility Act (RFA) would allow AMS

to certify that regulations do not have a

significant economic impact on a

substantial number of small entities.

However, as a matter of general policy,

AMS’ Fruit and Vegetable Programs

(Programs) no longer opt for such

certification, but rather perform

regulatory flexibility analyses for any

rulemaking that would generate the

interest of a significant number of small

entities. Performing such analyses shifts

the Programs’ efforts from determining

whether regulatory flexibility analyses

are required to the consideration of

regulatory options and economic

impacts.

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 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 40 handlers

of tart cherries who are subject to

regulation under the order and

approximately 1,220 producers or

growers of tart cherries in the regulated

area. Small agricultural service firms,

which include handlers, have been

defined by the Small Business

Administration (13 CFR 121.601) 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.

The majority of handlers and producers

of tart cherries may be classified as

small entities.

This final rule establishes rules and

regulations for grower diversion under

the tart cherry marketing order. The

order was promulgated on September

25, 1996. The Board was established on

December 20, 1996, met several times in

1997 and recommended numerous

rulemaking actions. The Board

recommended establishing an

assessment rate and late payment

charges, procedures for grower and
Federal Register / Vol. 63, No. 118 / Friday, June 19, 1998 /Rules and Regulations 33527

handler diversion and exemptions for

certain order provisions. The Board also

recommended regulations for the

issuance of grower diversion certificates

and final free and restricted percentages

for the 1997–98 crop year. These actions

were recommended at Board meetings

held March 12–13, June 26–27,

September 11–12, 1997, and January

29–30, 1998.

The impact of this rule will be

beneficial to growers. The receipt of

grower diversion certificates is one of

the methods under the order that

handlers can utilize to meet any such

handler’s restricted percentage. Growers

may voluntarily choose to divert

because they have an abundance of low

value, poor quality marketable cherries

or because they are unable to find a

processor willing to process some or all

of their cherries. Before choosing to

divert, the grower would most likely

evaluate the harvesting and other

cultural costs that could be saved by

diverting and locate a handler that

would be willing to redeem such

grower’s diversion certificate. An

interim final rule was published on

August 25, 1997, (62 FR 44881)

establishing terms and conditions for

the issuance of grower diversion

certificates by the Board for the 1997–

98 crop year. A final rule was published

on April 22, 1998, (63 FR 20019) in the

Federal Register.

Initially, about 700 growers expressed

an interest in participating in the

voluntary grower diversion program.

However, because of the exceptional

quality of 1997–98 tart cherry crop,

fewer growers opted to participate in the

grower diversion program. As such,

approximately 120 growers (65 growers

diverting by random row and 55

diverting by whole block diversion)

received diversion certificates for a total

of 6,139,600 pounds of diverted cherries

for an average of 51,163 pounds of

cherries diverted per grower. Although

it is difficult to quantify the overall

effect the grower diversion program has

had on the tart cherry industry at this

time, information from the Board

indicates that the program’s economic

impact on both the handlers and

growers appears to have been positive.

There seems to be overall satisfaction

among both growers and handlers with

this year’s returns. The economic

impact of the grower diversion

provisions of this regulation are also

expected to be positive. They should

result in benefits to both growers and

handlers which are similar to those

which resulted from the 1997–98

program. In addition, this rule offers

growers greater flexibility when

diverting their cherries.

With regard to methods of diversion,

this rule establishes four different ones:

random row, whole block, partial block

and in-orchard tank. During diversion

for the 1997–1998 season only the first

two were used. The Board discussed

limiting the blocks to be diverted to 5

acre blocks, but felt that this could have

an adverse impact on small growers that

produce on less than 5 acre blocks.

Therefore, the Board recommended

there be no limit on the size of orchard

blocks to be diverted. The Board also

discussed a sampling option that would

have required mapping to be done by

the grower each year the grower applied

for diversion, but rejected it because it

would be an undue burden on the

grower. Using the sampling methods in

this rule will only require the grower to

map an orchard one time and not redo

the map every year such grower may

want to divert.

This rule also establishes a

compensation rate of $250 per meeting

for the public member and alternate

public member when attending Board

meetings. The public member and

alternate public member would receive

$250 whether the Board meeting

convened and lasted for one or two days

or only four hours. The compensation to

be paid to the public member and

alternate public member would

compensate such persons for loss of

work or wages since such persons do

not have a financial interest in the tart

cherry industry. There was

consideration for a lower compensation

rate but the Board decided to proceed

with the above mentioned amount. The

Board did not support a lower

compensation rate because it did not

adequately compensate the public

member and alternate public member

for their time to attend Board meetings.

This rule will not impose any

reporting or recordkeeping requirements

on either small or large tart cherry

growers or handlers in addition to those

already considered or approved during

the order promulgation proceeding. The

only written information requested from

a grower is an orchard map and the

grower’s final production volume. Since

growers maintain this information as

part of their normal farming operations,

it takes approximately 10 minutes to

prepare a map and less than a minute

to total the final production volume. As

with all Federal marketing order

programs, reports and forms are

periodically reviewed to reduce

information requirements and

duplication by industry and public

sectors. In addition, the Department has

not identified any relevant Federal rules

which duplicate, overlap or conflict

with this rule.

In compliance with Office of

Management and Budget (OMB)

regulations (5 CFR Part 1320) which

implement the Paperwork Reduction

Act of 1995 (Pub. L. 104–13), the

information collection and

recordkeeping requirements imposed by

this order have been previously

approved by OMB and assigned OMB

Number 0581–0177.

The Board’s meetings were widely

publicized throughout the tart cherry

industry and all interested persons were

invited to attend the meeting and

participate in Board deliberations. Like

all Board meetings, the March, June,

September 1997, meetings and January

1998 meeting were public meetings and

all entities, both large and small, were

allowed to express their views on these

issues. The Board itself is composed of

18 members, of which 17 members are

growers and handlers and one

represents the public. Also, the Board

has a number of appointed committees

to review certain issues and make

recommendations to the Board. The

Board’s Diversion Subcommittee met on

March 12, 1997, and discussed grower

diversion in detail. That meeting was

also a public meeting and both large and

small entities were able to participate

and express their views. Finally,

interested persons are invited to submit

information on the regulatory and

informational impacts of this action on

small businesses.

A proposed rule concerning this

action was published in the Federal

Register on Thursday, April 23, 1998,

(63 FR 20274). Copies of the rule were

also mailed or sent via facsimile to all

Board members and cherry handlers.

Finally, the rule was made available

through the Internet by the Office of the

Federal Register.

A 30-day comment period was

provided which ended on May 26, 1998.

One comment was received in response

to the proposal. The commenter is the

Executive Director of the Board. The

commenter disagreed with the age of the

trees for which diversion is authorized.

The Board recommended to the

Secretary that the age of trees for which

diversion of fruit is permitted should be

5 years or older. The proposal stated

that only trees seven years or older

qualify for diversion. The commenter

stated that this is not consistent with the

needs of the industry.

The commenter further stated its

recommendation for change was not an

arbitrary action by the Board. Rather, it

is was done to bring the Board’s

diversion activities and authority in line

with cultural practices of the industry.

The proposal states that tart cherry trees

come into full commercial production
33528 Federal Register / Vol. 63, No. 118 / Friday, June 19, 1998 /Rules and Regulations

in a range from their fifth to seventh

growing season. The point at which a

particular tree reaches production

capacity depends upon geographic

location. The commenter stated that

recognition of this variance must be

made for in the diversion process. The

commenter believes that only allowing

trees seven years old or older to qualify

for diversion contributes to inequitable

treatment of producers in different areas

with different circumstances and with

different cultural practices. The

commenter further stated that the Board

unanimously determined that it was

more appropriate to recognize the full

age range in the diversion of younger

trees and orchards. By recognizing the

full range, the opportunity for diversion

activity is expanded for growers.

After consideration of this comment,

the Department is changing the

provision in the regulations concerning

the age of trees eligible for diversion

(§ 930.158(b)) to provide that trees that

are four years or younger do not qualify

for diversion. This would recognize the

full five to seven year range of age

maturation for the trees and allow

producers with younger fully producing

trees to qualify for diversion. This is

also in keeping with other provisions of

the regulations providing that only

cherries that have reached a harvestable,

marketable production will be eligible

for diversion.

After consideration of all relevant

matter presented, including the

information and recommendation

submitted by the Board 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.

It is hereby 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 growers are

expected to begin harvesting and

diverting their crop by mid-June and

need to know the rules and regulations

in order to participate in the grower

diversion program. Further, growers are

aware of this rule which was

recommended at a public meeting.

List of Subjects in 7 CFR Part 930

Marketing agreements, Tart cherries,

Reporting and recordkeeping

requirements.

For the reasons set forth in the

preamble, 7 CFR part 930 is amended as

follows:

PART 930—TART CHERRIES GROWN

IN THE STATES OF MICHIGAN, NEW

YORK, PENNSYLVANIA, OREGON,

UTAH, WASHINGTON, AND

WISCONSIN

1. The authority citation for 7 CFR

part 930 continues to read as follows:

Authority: 7 U.S.C. 601–674.

2. A new § 930.133 is added to read

as follows:

§ 930.133 Compensation rate.

A compensation rate of $250 per

meeting shall be paid to the public

member and to the alternate public

member when attending Board

meetings. Such compensation is a per

meeting rate. For example, if a Board

meeting is convened and lasts one or

two days or only four hours, the public

member and/or alternate public member

attending the meeting would receive

$250 each.

3. A new § 930.158 is added to read

as follows:

§ 930.158 Grower diversion and grower

diversion certificates.

(a) Grower diversion certificates. The

Board may issue diversion certificates to

growers in districts subject to volume

regulation who have voluntarily elected

to divert in the orchard all or a portion

of their tart cherry production which

otherwise, upon delivery to handlers,

would become restricted percentage

cherries. Growers may offer the

diversion certificate to handlers in lieu

of delivering cherries. Handlers may

redeem diversion certificates with the

Board through November 1 of each crop

year. After November 1 of the crop year

that crop year’s grower diversion

certificates are no longer valid. Cherries

that have reached a harvestable,

marketable condition will be eligible for

diversion. Diversion will not be granted

to growers whose fruit was destroyed

before it set and/or matured on the tree,

or whose fruit is unmarketable. If

marketable fruit were to be damaged or

destroyed by acts of nature such as

storms or hail diversion credit could be

granted.

(b) Application and mapping for

diversion. Any grower desiring to divert

cherries using methods other than

random row or in-orchard tank shall

submit a map of the orchard or orchards

to be diverted, along with a completed

Grower Diversion Application, to the

Board by June 24, 1998, for the 1998–

99 crop year (July 1, 1998 through June

30, 1999) and April 15 for subsequent

crop years. The application includes a

statement which must be signed by the

grower which states that the grower

agrees to comply with the regulations

established for a tart cherry diversion

program. Each map shall contain the

grower’s name and number assigned by

the Board, the grower’s address, block

name or number when appropriate,

location of orchard or orchards and

other information which may be

necessary to accomplish the desired

diversion. On or before July 1, the

grower should inform the Board of such

grower’s intention to divert in-orchard

and what type of diversion will be used.

The four types of diversion are random

row diversion, whole block diversion,

partial block diversion and in-orchard

tank diversion. A grower who informs

the Board about the type of diversion he

or she wishes to use by July 1 can elect

to use any diversion method or a

combination of diversion methods. Only

random row or in-orchard tank

diversion methods may be used if the

Board is not so informed by July 1.

Trees that are four years or younger do

not qualify for diversion.

(1) Random row diversion. Using the

orchard map furnished by the grower,

the Board will randomly select rows of

trees within the orchard to be diverted.

The amount of cherries to be diverted

will be based on the preliminary

restricted percentage amount

established pursuant to § 930.50. A

grower may elect a different percentage

amount; however, the grower needs to

inform the Board as soon as possible

after the preliminary percentages are

announced of this other amount, but in

no event shall this be less than seven

days in advance of harvest. The

designated rows indicated by the map

must not be harvested. After completing

harvest of the remaining rows in the

orchard, the grower must notify the

Board and/or the Board’s compliance

officer. A compliance officer will then

be allowed to observe the grower’s

orchard to assure that the selected rows

have not been harvested. The grower

must inform the Board of the total

production of the orchard to calculate

the tonnage that was diverted.

(2) Whole block diversion. Based on

maps supplied by the grower, a

sampling procedure will be used to

determine the amount of cherries in the

orchard to be diverted. A block is

defined as rows that run the same

direction, are similar in age, and have

definable boundaries. The Board would

require a number of trees to be sampled

depending on the size of the block. For

example, if a block has 5 rows or less,

3 rows would be randomly chosen to be

sampled, if a block has 6 to 15 rows, 4

rows would be randomly chosen to be

sampled, and if a block has 16 or more

rows, 5 rows would be randomly chosen

to be sampled. From each of the rows
Federal Register / Vol. 63, No. 118 / Friday, June 19, 1998 /Rules and Regulations 33529

to be sampled ten contiguous originally

planted tree sites will be sampled

within the rows. Only trees more than

five years old will be harvested for the

sample. For example, if it is determined

that five rows are to be sampled and 10

trees in the five rows are to be sampled,

then a total of 50 trees are to be sampled

((10 original tree sites) × (5 rows)= 50

trees). A total of 4600 pounds will be

harvested from the sample trees which

is divided by 50 trees to obtain a yield

of 92 pounds per tree. To find the yield

for the block, 92 pounds is multiplied

by 880 trees that were mapped in the

block to yield 80,960 pounds per block.

The harvested tonnage will be converted

to a volume that represents the entire

block of cherries. The grower should

inform the Board when the samples are

being taken so a compliance officer can

observe the sampling. The compliance

officer would be allowed to confirm that

the block has been diverted.

(3) Partial block diversion. Partial

block diversion will also be

accomplished using maps supplied by

the grower. Sampling will be done as in

whole block diversion except that only

partial blocks would be selected and

sampled. Growers may divert one

partial block per year. Such block must

be mapped and would be sampled as

described under whole block diversion.

Rows used in partial block diversion

must be contiguous.

(4) In-orchard tank diversion. Growers

wishing to in-orchard tank divert must

pick the cherries to be diverted and

place them in harvesting tanks. A

compliance officer would then probe

the tanks for volume measurement and

observe the destruction of the cherries

on the grower’s premises. Growers

wishing to take advantage of this option

must have at least 10 tanks ready for

diversion. The compliance officer has

up to five days to come to the grower’s

premises to observe the diversion after

being contacted.

(c) Compliance. Growers who

voluntarily participate in the grower

diversion program must sign and file

with the Board a Grower Diversion

Application. By signing the application,

a grower agrees to the terms and

conditions of the grower diversion

program as contained in these

regulations. To be eligible to receive

diversion credit, growers voluntarily

choosing to divert cherries must meet

the following terms and conditions:

(1) In order to receive a certificate, a

grower must demonstrate, to the

satisfaction of the Board, that rows or

trees which were selected for diversion

were not harvested. Trees four years old

or younger do not qualify for diversion.

(2) The grower must furnish the Board

with a total harvested production

amount so the Board can calculate the

amount of grower diversion tonnage to

be placed on the diversion certificate.

The Board will confirm the grower’s

production amount with information

provided by handlers (to which the

grower delivers cherries) on Board form

Number Two.

(3) The grower must agree to allow a

Board compliance officer to visit the

grower’s orchard to confirm that

diversion has actually taken place. If the

terms and conditions for whole block,

partial block or in-orchard tank

diversion are not completed, the Board

shall not issue the grower a diversion

certificate. If a grower who chooses

random row diversion harvests rows

that were designated not to be

harvested, the grower should inform the

Board immediately of the error. The

grower will then be required to divert

twice the amount (rows or trees)

incorrectly harvested to correct the

mistake. The grower will still receive a

diversion certificate equal to the original

requested amount. However, in

instances where a grower is at the end

of harvesting the orchard and fails to

divert a complete block or specified

rows, the Board shall multiply by two

the difference between the original

diversion amount and the actual

diverted amount. The Board shall

subtract that amount from the diversion

application amount. Thus, the grower

would receive a grower diversion

certificate equal to a portion of the

originally requested amount. If the

grower does not inform the Board of

such errors, the grower will not receive

a diversion certificate.

Dated: June 15, 1998.

Robert C. Keeney,

Deputy Administrator, Fruit and Vegetable

Programs.

[FR Doc. 98–16377 Filed 6–18–98; 8:45 am]

BILLING CODE 3410–02–P

DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

14 CFR Part 33

[Docket No. 98–ANE–119; Special

Conditions No. 33–001–SC]

Special Conditions: Turbomeca S.A.,

Model Arriel 2S1 Turboshaft Engine

AGENCY: Federal Aviation

Administration (FAA), DOT.

ACTION: Final special conditions.

SUMMARY: These special conditions are

issued for the Turbomeca S.A., of

Bordes, France, Model Arriel 2S1

turboshaft engine. This engine was

validated on June 10, 1996, by the

Federal Aviation Administration (FAA)

and Type Certificate No. E00054EN was

issued. The engine will have an

additional new novel or unusual engine

rating. The applicable airworthiness

regulations do not contain adequate or

appropriate safety standards for this

design feature. These special conditions

contain the additional safety standards

the Administrator considers necessary

to establish a level of safety equivalent

to that established by existing

airworthiness standards.

EFFECTIVE DATE: June 19, 1998.

FOR FURTHER INFORMATION CONTACT: Mr.

Chung Hsieh, Engine and Propeller

Standards Staff, ANE–110, Engine and

Propeller Directorate, Aircraft

Certification Service, FAA, New

England Region, 12 New England

Executive Park, Burlington,

Massachusetts 01803–5229; (781) 238–

7115; Fax (781) 238–7199.

SUPPLEMENTARY INFORMATION:

Background

On March 19, 1998, Turbomeca S.A.,

applied for an amendment to Type

Certificate No. E00054EN to include a

new 30-minute engine rating to Model

Arriel 2S1 turboshaft engine. The rating

is intended for use up to 30 minutes at

any time after takeoff in a flight for

performing search and rescue missions.

The Model Arriel 2S1 turboshaft engine

will be rated at 30-Second one engine

inoperative (OEI), 2-Minute OEI,

Continuous OEI, 30-Minute, Takeoff,

and Maximum Continuous ratings.

The applicable airworthiness

requirements do not contain a definition

for a ‘‘30-minute’’ power rating, and do

not contain adequate or appropriate

safety standards of this new and

unusual engine rating. The FAA

published a notice of proposed special

conditions on April 29, 1998 (63 FR

23402), Docket No. 98–ANE–119, and

requested public comments.

Type Certification Basis

Under the provisions of Title 14 of the

Code of Federal Regulations (14 CFR)

§ 21.101 Turbomeca S.A., must show

that the Model Arriel 2S1 turboshaft

engine meets the requirements of the

applicable regulations in effect on the

date of the application, or the applicable

provisions of the regulations

incorporated by reference in Type

Certificate No. E00054EN. The

regulations incorporated by reference in

the type certificate are commonly

referred to as the ‘‘original type

certification basis’’. The regulations