[Federal Register Volume 63, Number 142 (Friday, July 24, 1998)]
[Proposed Rules]
[Pages 39757-39759]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-19887]


-----------------------------------------------------------------------

DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 987

[Docket No. FV98-987-1 PR]


Domestic Dates Produced or Packed in Riverside County, CA; 
Increased Assessment Rate

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule.

-----------------------------------------------------------------------

SUMMARY: This rule would increase the assessment rate from $0.0556 to 
$0.10 per hundredweight established for the California Date 
Administrative Committee (Committee) under Marketing Order No. 987 for 
the 1998-99 and subsequent crop years. The Committee is responsible for 
local administration of the marketing order which regulates the 
handling of dates produced or packed in Riverside County, California. 
Authorization to assess date handlers enables the Committee to incur 
expenses that are reasonable and necessary to administer the program. 
The fiscal period begins October 1 and ends September 30. The 
assessment rate would remain in effect indefinitely unless modified, 
suspended, or terminated.

DATES: Comments must be received by September 22, 1998.

ADDRESSES: Interested persons are invited to submit written comments 
concerning this rule. Comments must be sent to the Docket Clerk, Fruit 
and Vegetable Programs, AMS, USDA, room 2525-S, P.O. Box 96456, 
Washington, DC 20090-6456; Fax: (202) 205-6632. Comments should 
reference the docket number and the date and page number of this issue 
of the Federal Register and will be available for public inspection in 
the Office of the Docket Clerk during regular business hours.

FOR FURTHER INFORMATION CONTACT: Diane Purvis, Marketing Assistant, or 
Richard P. Van Diest, Marketing Specialist, California Marketing Field 
Office, Fruit and Vegetable Programs, AMS, USDA, 2202 Monterey St., 
suite 102B, Fresno, CA 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, P.O. 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, P.O. Box 96456, Washington, DC 20090-6456; telephone: 
(202) 720-2491, Fax: (202) 205-6632.

SUPPLEMENTARY INFORMATION: This rule is issued under Marketing 
Agreement and Order No. 987, both as amended (7 CFR part 987), 
regulating the handling of domestic dates produced or packed in 
Riverside County, 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 
date 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 applicable to all assessable dates 
beginning on October 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

[[Page 39758]]

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 would increase the assessment rate established for the 
Committee for the 1998-99 and subsequent crop years from $0.0556 per 
hundredweight to $0.10 per hundredweight of assessable dates handled.
    The California date 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 producer-
handlers of California dates. 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 1996-97 and subsequent crop years, the Committee 
recommended, and the Department approved, an assessment rate that would 
continue in effect from crop year to crop 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 June 4, 1998, and unanimously recommended 
1998-99 expenditures of $80,000 and an assessment rate of $0.10 per 
hundredweight of dates handled. In comparison, last year's budgeted 
expenditures were $60,000. The assessment rate of $0.10 is $0.0444 
higher than the rate currently in effect. The higher assessment rate is 
needed to offset an expected reduction in funds available to the 
Committee from the sale of cull dates. Proceeds from such sales are 
deposited into the surplus account for subsequent use by the Committee 
in covering the surplus pool share of the Committee's expenses. 
Handlers may also dispose of cull dates of their own production within 
their own livestock-feeding operation; otherwise, such cull dates must 
be shipped or delivered to the Committee for sale to non-human food 
product outlets.
    The Committee expects to apply $40,000 of surplus account monies to 
cover surplus pool expenses during 1997-98. Based on a recent trend of 
declining sales of cull dates over the past few years, the Committee 
expects the surplus pool share of expenses during 1998-99 to be 
$30,000, or $10,000 less than expected during 1997-98. Hence, the 
revenue available from the surplus pool to cover Committee expenses 
during 1998-99 is expected to be 25 percent less than last year. To 
offset this reduction in income, the Committee recommended increasing 
the assessment rate and using $20,000 from its administrative reserves 
to fund the 1998-99 budget.
    The major expenditures recommended by the Committee for the 1998-99 
year include $32,100 in salaries and benefits, $20,000 in office 
administration, and $23,990 in office expenses. Office administration 
includes $16,000 towards the salary for a new compliance officer 
position. Budgeted expenses for these items in 1997-98 were $37,627 in 
salaries and benefits and $18,507 in office expenses.
    The assessment rate recommended by the Committee was derived from 
applying the following formula where:
A = 1998-99 surplus account ($30,000);
B = amount taken from administrative reserves ($20,000);
C = 1998-99 expenses ($80,000);
D = 1998-99 expected shipments (300,000 hundredweight);
(C -(A + B)) <divide> D = $0.10 per hundredweight.
    Estimated shipments should provide $30,000 in assessment income. 
Income derived from handler assessments, the surplus account (which 
contains money from cull date sales), and the administrative reserves 
would be adequate to cover budgeted expenses. Funds in the reserve are 
expected to total about $20,000 by September 30, 1998, and therefore 
would be less than the maximum permitted by the order (not to exceed 
50% of the average of expenses incurred during the most recent five 
preceding crop years; Sec. 987.72(c)).
    The proposed assessment rate would 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 would be in effect for an indefinite 
period, the Committee would continue to meet prior to or during each 
crop 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 would 
evaluate Committee recommendations and other available information to 
determine whether modification of the assessment rate is needed. 
Further rulemaking would be undertaken as necessary. The Committee's 
1998-99 budget and those for subsequent crop years would 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 initial 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 135 producers of dates in the production 
area and approximately 20 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 of less than $500,000, and small agricultural service firms 
are defined as those having annual receipts of less than $5,000,000. 
The majority of California date producers and handlers may be 
classified as small entities.
    This rule would increase the assessment rate established for the 
Committee and collected from handlers for the 1998-99 and subsequent 
crop years from $0.0556 per hundredweight to $0.10 per hundredweight of 
assessable dates handled. The Committee unanimously recommended 1998-99 
expenditures of $80,000 and an assessment rate of $0.10 per 
hundredweight. The proposed assessment rate of $0.10 is $0.0444 higher 
than the 1997-98 rate. The quantity of assessable dates for the 1998-99 
crop year is estimated at 300,000 hundredweight. Thus, the $0.10

[[Page 39759]]

rate should provide $30,000 in assessment income and, in conjunction 
with other funds available to the Committee, be adequate to meet this 
year's expenses. Funds available to the Committee include income 
derived from assessments, the surplus account (which contains money 
from cull date sales), and the administrative reserves.
    The higher assessment rate is needed to offset an expected 
reduction in funds available to the Committee from the sale of cull 
dates to non-human food product outlets. Proceeds from such sales are 
deposited into the surplus account for subsequent use by the Committee. 
Last year, the Committee applied $40,000 to the budget from the sale of 
cull dates as the surplus account's share of Committee expenses. Based 
on a trend of declining sales of cull dates over the past few years, 
this year the Committee expects to only be able to apply $30,000 (25 
percent less) to the budget from the sale of cull dates.
    The Committee reviewed and unanimously recommended 1998-99 
expenditures of $80,000 which included increases in salaries and 
benefits and administrative expenses. Prior to arriving at this budget, 
the Committee considered alternative expenditure levels, including a 
proposal to not fund a compliance officer position, but determined that 
expenditures for the position were necessary to promote compliance with 
program requirements. The assessment rate of $0.10 per hundredweight of 
assessable dates was then determined by applying the following formula 
where:

A = 1998-99 surplus account ($30,000);
B = amount taken from administrative reserves ($20,000);
C = 1998-99 expenses ($80,000);
D = 1998-99 expected shipments (300,000 hundredweight);
(C - (A + B)) <divide> D = $0.10 per hundredweight.

    A review of historical information and preliminary information 
pertaining to the upcoming crop year indicates that the grower price 
for the 1998-99 season could range between $30 and $75 per 
hundredweight of dates. Therefore, the estimated assessment revenue for 
the 1998-99 crop year as a percentage of total grower revenue would be 
less than one percent.
    This action would increase 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 
would 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 date industry, and all interested 
persons were invited to attend the meeting and participate in Committee 
deliberations on all issues. Like all Committee meetings, the June 4, 
1998, meeting was a public meeting and all entities, both large and 
small, were able to express views on this issue. Finally, interested 
persons are invited to submit information on the regulatory and 
informational impacts of this action on small businesses.
    This proposed rule would impose no additional reporting or 
recordkeeping requirements on either small or large California date 
handlers. 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 60-day comment period is provided to allow interested persons to 
respond to this proposed rule.

List of Subjects in 7 CFR Part 987

    Dates, Marketing agreements, Reporting and recordkeeping 
requirements.
    For the reasons set forth in the preamble, 7 CFR part 987 is 
proposed to be amended as follows:

PART 987--DOMESTIC DATES PRODUCED OR PACKED IN RIVERSIDE COUNTY, 
CALIFORNIA

    1. The authority citation for 7 CFR part 987 continues to read as 
follows:

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

    2. Section 987.339 is proposed to be revised to read as follows:


Sec. 987.339  Assessment rate.

    On and after October 1, 1998, an assessment rate of $0.10 per 
hundredweight is established for California dates.

    Dated: July 21, 1998.
Robert C. Keeney,
Deputy Administrator, Fruit and Vegetable Programs.
[FR Doc. 98-19887 Filed 7-23-98; 8:45 am]
BILLING CODE 3410-02-P