This section of the FEDERAL REGISTER

contains notices to the public of the proposed

issuance of rules and regulations. The

purpose of these notices is to give interested

persons an opportunity to participate in the

rule making prior to the adoption of the final

rules.

Proposed Rules Federal Register

26810

Vol. 66, No. 94

Tuesday, May 15, 2001

DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 920

[Docket No. FV01–920–1 PR]

Kiwifruit Grown in California; Removal

of Certain Inspection and Pack

Requirements

AGENCY: Agricultural Marketing Service,

USDA.

ACTION: Proposed rule.

SUMMARY: This rule invites comments

on the removal of certain inspection and

pack requirements prescribed under the

California kiwifruit marketing order

(order). The order regulates the handling

of kiwifruit grown in California and is

administered locally by the Kiwifruit

Administrative Committee (Committee).

This rule would remove the requirement

that fruit must be reinspected if it has

not been shipped by specified dates,

and would also remove the minimum

net weight requirements for kiwifruit

tray packs. These changes are expected

to reduce handler packing costs,

increase grower returns, and enable

handlers to compete more effectively in

the marketplace.

DATES: Comments must be received by

June 14, 2001.

ADDRESSES: Interested persons are

invited to submit written comments

concerning this proposal. Comments

must be sent to the Docket Clerk,

Marketing Order Administration

Branch, Fruit and Vegetable Programs,

AMS, USDA, room 2525–S, P.O. Box

96456, Washington, DC 20090–6456;

Fax: (202) 720–8938, or E-mail:

moab.docketclerk@usda.gov. All

comments should reference the docket

number and the date and page number

of this issue of the Federal Register and

will be made available for public

inspection in the Office of the Docket

Clerk during regular business hours.

FOR FURTHER INFORMATION CONTACT: Rose

M. Aguayo, Marketing Specialist,

California Marketing Field Office,

Marketing Order Administration

Branch, Fruit and Vegetable Programs,

AMS, USDA, 2202 Monterey Street,

suite 102B, Fresno, California 93721;

telephone: (559) 487–5901, Fax: (559)

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) 720–8938. Small

businesses may request information on

complying 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) 720–8938, or E-mail:

Jay.Guerber@usda.gov.

SUPPLEMENTARY INFORMATION: This

proposal is issued under Marketing

Order No. 920, as amended (7 CFR part

920), regulating the handling of

kiwifruit grown in California,

hereinafter referred to as the ‘‘order.’’

The order is 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 proposal has been reviewed

under Executive Order 12988, Civil

Justice Reform. This rule is not intended

to have retroactive effect. This proposal

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 proposal invites comments on

the removal of certain inspection and

pack requirements prescribed under the

order. The order regulates the handling

of kiwifruit grown in California and is

administered locally by the Kiwifruit

Administrative Committee (Committee).

This rule would remove the requirement

that fruit must be reinspected if it has

not been shipped by specified dates,

and would also remove the minimum

net weight requirements for kiwifruit

tray packs. These changes are expected

to reduce handler packing costs,

increase grower returns, and enable

handlers to compete more effectively in

the marketplace.

Removal of Reinspection Requirement

Section 920.55 of the order requires

that prior to handling any variety of

California kiwifruit, such kiwifruit shall

be inspected by the Federal or FederalState Inspection Service (inspection

service) and certified as meeting the

applicable grade, size, quality, or

maturity requirements in effect pursuant

to § 920.52 or § 920.53.

Section 920.55(b) provides authority

for the establishment, through the

order’s rules and regulations, of a period

prior to shipment during which

inspections must be performed.

Prior to its suspension for 1998–1999

season, § 920.155 of the order’s rules

and regulations specified that the

certification of grade, size, quality, and

maturity of kiwifruit pursuant to

§ 920.52 or § 920.53 during each fiscal

year was valid until December 31 of

such year or 21 days from the date of

inspection, whichever is later. Any

inspected kiwifruit shipped after the

certification period lapsed was required

to be reinspected and recertified before

shipment.

Section 920.155 was suspended for

the 1998–1999 season by a final rule

published August 4, 1998 (63 FR

41390). The Committee recommended

this suspension to lessen the expenses

upon the many kiwifruit growers who

had either lost money or merely

recovered their production costs in

recent years. It concluded that the cost

of reinspecting kiwifruit was too high to

justify requiring it in view of the limited

benefit reinspection provided. The

Committee also believed it was no

Federal Register / Vol. 66, No. 94 / Tuesday, May 15, 2001 / Proposed Rules 26811

longer necessary to have fruit

reinspected to provide consumers with

a high quality product because storage

and handling operations had improved

in the industry.

During the 1998–1999 season,

handlers voluntarily checked stored

fruit prior to shipment to ensure that the

condition of the fruit had not

deteriorated. Suspension of the

reinspection requirement enabled

handlers to ship quality kiwifruit during

the 1998–1999 season without the

necessity for reinspection and

recertification and the costs associated

with such requirements. However,

because the harvest started later than

normal and more fruit was in-line

inspected and shipped directly to

buyers, less fruit was repacked and

available for evaluation than

anticipated.

Therefore, at its February 25, 1999,

meeting, the Committee unanimously

recommended suspending § 920.155 of

the order for one more season. Section

920.155 was suspended for the 1999–

2000 season by a final rule published on

July 29, 1999 (64 FR 41010).

During the 1999–2000 season a severe

frost reduced the crop size from the

estimated 9 million tray equivalents to

6 million tray equivalents. A tray

equivalent is equal to approximately 7

pounds of fruit. This significant crop

reduction and the excellent quality of

the fruit resulted in limited quantities of

fruit remaining in cold storage for

repacking and evaluation. The

Committee wanted to fully evaluate the

suspension of the reinspection

requirement during a normal season.

Therefore the Committee, at its February

24, 2000, meeting, unanimously

recommended suspending § 920.155 for

another season, the 2000–2001 season.

Section 920.155 was suspended for the

2000–2001 season by a final rule

published on June 14, 2000 (65 FR

37265).

The 2000–2001 season was normal

and enabled the industry to conclude

that the suspensions have indeed

helped handlers reduce packing costs

and to compete more effectively in the

marketplace. Therefore, at its February

28, 2001, meeting the Committee

recommended removing this inspection

requirement for the 2001–2002 and

future seasons. As previously

experienced, this change is expected to

result in reduced handler packing costs,

increased growers returns, and enable

handlers to compete more effectively in

the marketplace.

Removal of Minimum Net Weight

Requirements for Trays

Under the terms of the order, fresh

market shipments of kiwifruit grown in

California are required to be inspected

and meet grade, size, maturity, pack,

and container requirements. Section

920.52 authorizes the establishment of

minimum size, pack, and container

requirements.

Section 920.302(a)(4) of the order’s

rules and regulations outlines pack

requirements for fresh shipments of

California kiwifruit.

Section 920.302(a)(4)(iii) specifies

minimum net weight requirements for

fruit of various sizes packed in

containers with cell compartments,

cardboard fillers, or molded trays.

Prior to the 1989–1990 season, there

were no minimum tray weight

requirements, although 73.5 percent of

the crop was packed in trays. During the

1989–1990 season, minimum tray

weights were mandated, as there were

many new packers involved in the

kiwifruit packing process and stricter

regulations were viewed as necessary to

provide uniform container weights for

each size. However, since that season

the proportion of the crop packed in

trays has steadily declined.

During the 1997–1998 season, only

15.5 percent of the crop was tray packed

and less than 1 percent of this fruit was

rejected for failure to meet minimum

tray weights. As a consequence, the

Committee believed that minimum tray

weight requirements might no longer be

necessary to maintain uniformity in the

marketplace.

Prior to the 1998–1999 season

handlers were required to meet the

minimum net weight requirements as

shown in the following chart:

Count designation of fruit

Minimum net

weight of fruit

(pounds)

34 or larger ............................. 7.5

35 to 37 .................................. 7.25

38 to 40 .................................. 6.875

41 to 43 .................................. 6.75

44 and smaller ........................ 6.5

The Committee met on July 8, 1998,

and unanimously recommended

suspension of the minimum net weight

requirements for kiwifruit packed in cell

compartments, cardboard fillers, or

molded trays for the 1998–1999 season.

Section 920.302(a)(4)(iii) was suspended

for the 1998–1999 season by an interim

final rule which was published

September 3, 1998 (63 FR 14861) and

finalized July 29, 1999 (64 FR 41019).

Even though the fruit was shorter,

more full-bodied, and heavier during

the 1998–1999 season, handlers were

able to reduce packing costs and to

compete more effectively in the market.

The industry continued to pack wellfilled trays without having to spend the

extra time weighing them. There was no

reduction in the uniform appearance of

fruit packed into trays. The consensus of

the industry was that the absence of tray

weights had no impact during the 1998–

1999 season due to the exceptionally

heavy weight of the fruit.

The Committee, at its February 25,

1999, meeting unanimously

recommended suspending the minimum

net weight requirements for the 1999–

2000 season to evaluate the suspended

requirements during a season when the

fruit shape and density were normal.

This suspension was implemented by a

final rule published on July 29, 1999 (64

FR 41010).

As previously mentioned, the 1999–

2000 crop was approximately three

million tray-equivalents shorter than

estimated due to a severe frost during

the spring of 1999. This shortage of fruit

resulted in limited quantities of fruit

available for evaluation. Because of the

uncharacteristic fruit in the 1998–1999

season and the short crop in the 1999–

2000 season, the Committee

recommended suspending the minimum

net weight requirement for another year

of evaluation. Therefore, at its February

24, 2000, meeting, the Committee once

again unanimously recommended

continuing the suspension of

§ 920.302(a)(4)(iii) for another season,

the 2000–2001 season. The suspension

was implemented through July 31, 2001,

by a final rule issued June 14, 2000 (65

FR 37265). The 2000–2001 season was

normal and enabled the industry to

conclude that the suspensions have

helped handlers reduce packing costs

and to compete more effectively in the

marketplace. Therefore, at its February

28, 2001, meeting, the Committee

recommended removing this pack

requirement for the 2001–2002 and

future seasons. As previously

experienced, this change is expected to

result in reduced handler packing costs,

increased growers returns, and enable

handlers to compete more effectively in

the marketplace, as previously

experienced.

Initial Regulatory Flexibility Analysis

Pursuant to requirements set forth in

the Regulatory Flexibility Act (RFA), the

Agricultural Marketing Service (AMS)

has considered the economic impact of

this action 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

26812 Federal Register / Vol. 66, No. 94 / Tuesday, May 15, 2001 / Proposed Rules

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 50 handlers

of California kiwifruit subject to

regulation under the marketing order

and approximately 350 producers in the

production area. Small agricultural

producers are defined by the Small

Business Administration (13 CFR

121.201) as those whose annual receipts

are less than $500,000, and small

agricultural service firms are defined as

those whose annual receipts are less

than $5,000,000. All of the handlers

have annual receipts of less than

$5,000,000, excluding receipts from

other sources. Three hundred forty-five

producers have annual sales of less than

$500,000, excluding receipts from any

other sources. Therefore, a majority of

the kiwifruit handlers and producers

may be classified as small entities.

This rule would remove § 920.155

which requires that fruit be reinspected

if it has not been shipped by specified

dates, and would remove paragraph

(a)(4)(iii) of § 920.302 which specifies

minimum net weight requirements for

kiwifruit tray packs. These changes are

expected to reduce handler-packing

costs, increase grower returns, and

enable handlers to compete more

effectively in the marketplace. Authority

for this action is provided in §§ 920.52

and 920.55 of the order.

Removal of Reinspection Requirement

Removing the requirement that

kiwifruit must be reinspected if has not

been shipped by a certain date would

have a minimal impact on the quality of

fruit shipped. Prior to its suspension for

1998–1999 season, § 920.155 of the

order’s rules and regulations specified

that the certification of grade, size,

quality, and maturity of kiwifruit

pursuant to § 920.52 or § 920.53 during

each fiscal year was valid until

December 31 of such year or 21 days

from the date of inspection, whichever

is later. Any inspected kiwifruit shipped

after the certification period lapsed was

required to be reinspected and

recertified before shipment.

Section 920.155 was suspended for

the 1998–1999 season by a final rule

published August 4, 1998 (63 FR

41390). The Committee recommended

this suspension to lessen the expenses

upon the many kiwifruit growers who

had either lost money or merely

recovered their production costs in

recent years. It concluded that the cost

of reinspecting kiwifruit was too high to

justify requiring it in view of the limited

benefit reinspection provided. Total

average costs for reinspection was

estimated to be $50,000 a year. The

Committee also believed it was no

longer necessary to have fruit

reinspected to provide consumers with

a high quality product because storage

and handling operations had improved

in the industry.

During the 1998–1999 season,

handlers voluntarily checked stored

fruit prior to shipment to ensure that the

condition of the fruit had not

deteriorated. Quality control efforts in

place within the industry combined

with improved storage due to research

and technological advances has ensured

that quality fruit reaches the market.

Suspension of the reinspection

requirement enabled handlers to ship

quality kiwifruit during the 1998–1999

season without the necessity for

reinspection and recertification and the

costs associated with such

requirements. However, because the

harvest started later than normal and

more fruit was in-line inspected and

shipped directly to buyers, less fruit was

repacked and available for evaluation

than anticipated.

Therefore, at its February 25, 1999,

meeting, the Committee unanimously

recommended suspending § 920.155 of

the order for one more season. Section

920.155 was suspended for the 1999–

2000 season by a final rule published on

July 29, 1999 (64 FR 41010).

During the 1999–2000 season a severe

frost reduced the crop size from the

estimated 9 million tray equivalents to

6 million tray equivalents. A tray

equivalent is equal to approximately 7

pounds of fruit. This significant crop

reduction and the excellent quality of

the fruit resulted in less fruit remaining

in cold storage for repacking and

evaluation.

The Committee believed that the

industry realized benefits from the

suspension of the reinspection

requirement, and recommended

evaluating the results of the suspended

reinspection requirements during a

normal season. Thus the Committee, at

its February 24, 2000, meeting,

unanimously recommended suspending

§ 920.155 for the 2000–2001 season.

This suspension was implemented by a

final rule published on June 14, 2000

(65 FR 37265). The 2000–2001 season

was normal and enabled the industry to

conclude that the suspensions have

helped handlers reduce packing costs

and to compete more effectively in the

marketplace. The kiwifruit industry

estimated that removal of the

reinspection requirement has resulted in

cost savings to the industry of

approximately $50,000 a year.

Therefore, the Committee, at its

February 28, 2001, meeting,

unanimously recommended removing

§ 920.155 for the 2001–2002 and future

seasons.

Removal of Minimum Net Weight

Requirements for Trays

Removing the minimum tray weight

requirements for kiwifruit packed in cell

compartments, cardboard fillers, or

molded trays would have a minimal

impact on the appearance of tray packs.

Under the terms of the order, fresh

market shipments of kiwifruit grown in

California are required to be inspected

and meet grade, size, maturity, pack,

and container requirements.

Prior to the 1989–1990 season, there

were no minimum tray weight

requirements although 73.5 percent of

the crop was packed in trays. During the

1989–1990 season, minimum tray

weights were mandated, as there were

many new packers involved in the

kiwifruit packing process and stricter

regulations were viewed as necessary to

provide uniform container weights for

each size. However, since that season,

the proportion of the crop packed in

trays has steadily declined.

During the 1997–1998 season, only

15.5 percent of the crop was tray packed

and less than 1 percent of this fruit was

rejected for failure to meet minimum

tray weights. As a consequence, the

Committee believed that minimum tray

weight requirements might no longer be

necessary to maintain uniformity in the

marketplace.

Prior to the 1998–1999 season

handlers were required to meet the

minimum net weight requirements as

shown in the following chart:

Count designation of fruit

Minimum net

weight of fruit

(pounds)

34 or larger ............................. 7.5

35 to 37 .................................. 7.25

38 to 40 .................................. 6.875

41 to 43 .................................. 6.75

44 and smaller ........................ 6.5

Therefore, at its meeting on July 8,

1998, the Committee unanimously

recommended suspension of the

minimum net weight requirements for

kiwifruit packed in cell compartments,

cardboard fillers, or molded trays for the

1998–1999 season. Section

920.302(a)(4)(iii) was suspended for the

1998–1999 season by an interim final

rule published September 3, 1998 (63

FR 14861).

Federal Register / Vol. 66, No. 94 / Tuesday, May 15, 2001 / Proposed Rules 26813

Even though the fruit was shorter,

more full-bodied, and heavier during

the 1998–1999 season, handlers were

able to reduce packing costs and to

compete more effectively in the

marketplace. The industry continued to

pack well-filled trays without having to

spend the extra time weighing them.

There was no reduction in the uniform

appearance of fruit packed into trays.

The consensus of the industry that

season was that the absence of tray

weights had no negative impact during

the 1998–1999 season due to the

exceptionally heavy weight of the fruit.

The Committee, at its February 25,

1999, meeting, unanimously

recommended suspending the minimum

net weight requirements for the 1999–

2000 season to evaluate the suspended

requirements during a season when the

fruit shape and density were normal.

This suspension was implemented by a

final rule published on July 29, 1999 (64

FR 41010).

As previously mentioned, the 1999–

2000 crop was approximately three

million tray-equivalents shorter than

estimated due to a severe frost during

the spring of 1999. This shortage of fruit

resulted in limited quantities of fruit

available for evaluation. Because of the

uncharacteristic fruit in the 1998–1999

season and the short crop in the 1999–

2000 season, the Committee voted to

suspend the minimum net weight

requirement for another year of

evaluation. Therefore, at its February 24,

2000, meeting, the Committee once

again unanimously recommended

continuing the suspension of

§ 920.302(a)(4)(iii) for another season,

the 2000–2001 season. This suspension

was implemented by a final rule issued

June 14, 2000 (65 FR 37265) and is in

effect until July 31, 2001.

The 2000–2001 season was normal

and enabled the Committee to conclude

that the suspensions have helped

handlers reduce packing costs and to

compete more effectively in the

marketplace. The Committee and the

Federal-State Inspection Service also

have concluded that removing the

minimum tray weight requirements

would not result in a reduction in

inspection costs as the inspection

process is essentially the same. The

Committee, at its February 28, 2001,

meeting, unanimously recommended

removing paragraph (a)(4)(iii) of

§ 920.302 for the 2001–2002 and all

future seasons. The Committee also

noted that the minimum size

requirement should be maintained on

all kiwifruit regardless of pack style.

These changes address the marketing

and shipping needs of the kiwifruit

industry and are in the interests of

handlers, growers, buyers, and

consumers. The impact of these changes

is expected to be beneficial to all

handlers and growers regardless of size.

The Committee discussed alternatives

to this change, including continuing the

temporary suspensions for another year.

The industry believes that it has had

adequate time to evaluate these changes.

The suspensions helped handlers

reduce packing costs and compete more

effectively in the marketplace without

an adverse affect on quality or

appearance of the fruit. Therefore, the

Committee recommended removal of

§§ 920.155 and 920.302(a)(4)(iii) for the

2001–2002 and future seasons.

This proposed rule would relax

inspection and pack requirements under

the kiwifruit marketing order.

Accordingly, this action would not

impose any additional reporting or

recordkeeping requirements on either

small or large kiwifruit 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

proposed rule.

In addition, the Committee’s meeting

was widely publicized throughout the

kiwifruit industry and all interested

persons were invited to attend the

meetings and participate in Committee

deliberations on all issues. Like all

Committee meetings, the February 28,

2001, meeting was a public meeting and

all entities, both large and small, were

able to express their views on this issue.

The majority of the industry are small

entities. Finally, interested persons are

invited to submit information on the

regulatory and informational impacts of

this action on small businesses.

A small business guide on complying

with fruit, vegetable, and specialty crop

marketing agreements and orders may

be viewed at: http://www.ams.usda.gov/

fv/moab.html. Any questions about the

compliance guide should be sent to Jay

Guerber at the previously mentioned

address in the FOR FURTHER INFORMATION

CONTACT section.

A 30-day comment period is provided

to allow interested persons to respond

to this proposal. Thirty days is deemed

appropriate because this rule would

need to be in place by August 1, 2001,

as the current suspensions expire on

July 31, 2001, and handlers need to

make operational decisions in time for

the 2001–2002 season. All written

comments timely received will be

considered before a final determination

is made on this matter.

List of Subjects in 7 CFR Part 920

Kiwifruit, Marketing agreements,

Reporting and recordkeeping

requirements.

For the reasons set forth in the

preamble, 7 CFR part 920 is proposed to

be amended as follows:

PART 920—KIWIFRUIT GROWN IN

CALIFORNIA

1. The authority citation for 7 CFR

part 920 continues to read as follows:

Authority: 7 U.S.C. 601–674.

§ 920.155 [Removed]

2. In part 920, § 920.155 is removed in

its entirety.

§ 920.302 [Amended]

3. In § 920.302, paragraph (a)(4)(iii) is

removed and paragraphs (a)(4)(iv), (v),

and (vi) are redesignated as paragraphs

(a)(4) (iii), (iv), and (v), respectively.

Dated: May 9, 2001.

Kenneth C. Clayton,

Acting Administrator, Agricultural Marketing

Service.

[FR Doc. 01–12140 Filed 5–14–01; 8:45 am]

BILLING CODE 3410–02–P

DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 930

[Docket No. FV01–930–4 PR]

Tart Cherries Grown in the States of

Michigan, et al.; Temporary

Suspension of a Provision Regarding a

Continuance Referendum Under the

Tart Cherry Marketing Order

AGENCY: Agricultural Marketing Service,

USDA.

ACTION: Proposed rule.

SUMMARY: This proposed rule requests

comments on the temporary suspension

of an order provision which requires a

continuance referendum to be

conducted on the marketing order for

tart cherries during March 2002. The

proposed suspension would enable the

U.S. Department of Agriculture (USDA

or Department) to postpone conducting

the continuance referendum until the

completion of amendatory order

proceedings. The Cherry Industry

Administrative Board (Board)

recommended a delay in holding the

continuance referendum to allow the

industry to evaluate the results of any

approved amendments. A continuance