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Rules and Regulations Federal Register

72195 

Vol. 70, No. 231 

Friday, December 2, 2005 

DEPARTMENT OF AGRICULTURE 

Agricultural Marketing Service 

7 CFR Part 984 

[Docket No. FV05–984–1 FIR] 

Walnuts Grown in California; 

Suspension of Provision Regarding 

Eligibility of Walnut Marketing Board 

Members 

AGENCY: Agricultural Marketing Service, 

USDA. 

ACTION: Final rule. 

SUMMARY: The Department of 

Agriculture (USDA) is adopting, as a 

final rule, without change, an interim 

final rule suspending the provision of 

the walnut marketing order (order) 

pertaining to eligibility of members to 

serve on the Walnut Marketing Board 

(Board). The order regulates the 

handling of walnuts grown in 

California, and the Board is responsible 

for local administration of the order. 

This action is an interim measure that 

addresses a change in industry structure 

affecting cooperative marketing 

association related positions. This 

allows the Board to continue to 

represent the industry’s interests while 

the order is amended to reflect the 

change in industry structure. The Board 

unanimously recommended a 

suspension action by mail balloting in 

early July 2005. 

EFFECTIVE DATE: January 3, 2006. 

FOR FURTHER INFORMATION CONTACT: 

Martin Engeler, Senior Marketing 

Specialist, Marketing Order 

Administration Branch, Fruit and 

Vegetable Programs, AMS, USDA, 

Telephone: (559) 487–5901, Fax: (559) 

487–5906; or Kathleen M. Finn, Formal 

Rulemaking Team Leader, Marketing 

Order Administration Branch, Fruit and 

Vegetable Programs, AMS, USDA, 1400 

Independence Avenue, SW., STOP 

0237, Washington, DC 20250–0237; 

telephone: (202) 720–2491, or 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, 1400 Independence 

Avenue, SW., STOP 0237, Washington, 

DC 20250–0237; Telephone: (202) 720– 

2491, Fax: (202) 720–8938, or E-mail: 

Jay.Guerber@usda.gov. 

SUPPLEMENTARY INFORMATION: This rule 

is issued under Marketing Agreement 

and Order No. 984, both as amended (7 

CFR part 984), hereinafter referred to as 

the ‘‘order’’, regulating the handling of 

walnuts grown in the State of California. 

The marketing agreement and order are 

effective pursuant to the Agricultural 

Marketing Agreement Act of 1937, as 

amended (7 U.S.C. 601–674), hereinafter 

referred to as the ‘‘Act.’’ 

USDA 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 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 USDA 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 USDA 

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 USDA’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 continues in effect an action 

that suspended a provision of the order 

pertaining to the eligibility of members 

to serve on the Board. The order 

regulates the handling of walnuts grown 

in California, and the Board is 

responsible for local administration of 

the order. This action is an interim 

measure that addresses a change in the 

industry structure affecting cooperative 

marketing association related positions. 

This allows the Board to continue to 

represent the industry’s interests while 

the order is amended to reflect the 

change in industry structure. The Board 

unanimously recommended a 

suspension action by mail balloting in 

early July 2005. 

Section 984.35 of the order establishes 

the Board as the administrative body 

appointed by USDA to administer the 

order. That section also specifies 

composition of the Board, and allocates 

seats to cooperative and independent 

growers and handlers. The Board is 

comprised of ten members and ten 

alternate members. Two members 

represent handlers that are cooperative 

marketing associations of growers 

(cooperative handlers), and two 

members represent growers who market 

their walnuts through cooperative 

handlers. Two members represent 

handlers that are not cooperative 

marketing associations of growers 

(independent handlers), and two 

members represent growers that market 

their walnuts through independent 

handlers. One member represents 

growers that market their walnuts 

through either cooperative or 

independent handlers, whichever 

category handled over fifty percent of 

the walnuts handled by all handlers in 

the industry in the immediately 

preceding two marketing years. In 

recent years, this Board position has 

been allocated to the independent 

category. One member represents 

neither growers nor handlers (public 

member). 

Prior to implementation of the interim 

final rule, § 984.38 of the order 

provided, in part, that no person shall 

be selected or continue to serve as a 

member or alternate member of the 

Board unless that person is engaged in 

the business of the group he or she was 

nominated to represent. 

A change recently occurred in the 

walnut industry that impacts 

composition of the Board. A large 

cooperative marketing association 

recently converted to a publicly held 

corporation. The former cooperative 

association held two grower and two 

handler positions on the Board. 

72196 Federal Register / Vol. 70, No. 231 / Friday, December 2, 2005 / Rules and Regulations 

In order to address this change, 

§ 984.38 of the order needed to be 

suspended to allow a representative 

Board to continue in place while the 

order is amended to reflect the new 

industry structure. Therefore, the Board 

recommended through a mail ballot vote 

in early July 2005, to suspend the order 

provision. USDA reviewed the 

recommendation and determined that 

suspending § 984.38 of the order 

regarding eligibility requirements of 

Board members would accomplish that 

objective. As previously discussed, 

§ 984.38 provided that no person shall 

be selected or continue to serve as a 

member or alternate member of the 

Board unless that person is engaged in 

the business of the group he or she was 

nominated to represent. 

If the eligibility requirements were 

not suspended, four of the Board 

members that represented the 

cooperative would be ineligible to serve 

on the Board. However, these members 

continue to represent a significant 

portion of the industry. Suspending the 

order provision regarding eligibility of 

Board members allows a complete 

Board to remain in place. This action 

enables a Board that is representative of 

the walnut industry to continue to 

administer the order without disruption 

while the order is being amended to 

reflect changes in the industry structure. 

This action continues to suspend 

§ 984.38 of the order entitled 

‘‘Eligibility.’’ This action is in the best 

interest of handlers and growers in the 

California walnut industry as the 

industry transitions through a structural 

change. 

Final Regulatory Flexibility Act 

Pursuant to the requirements set forth 

in the Regulatory Flexibility Act (RFA), 

the Agricultural Marketing Service 

(AMS) has considered the economic 

impact of this rule on small entities. 

Accordingly, AMS has prepared this 

final regulatory flexibility analysis. 

The purpose of the RFA is to fit 

regulatory actions to the scale of 

business subject to such actions in order 

that small businesses will not be unduly 

or disproportionately burdened. 

Marketing orders issued pursuant to the 

Act, and 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 5,000 

producers of walnuts in the production 

area and 50 walnut handlers subject to 

regulation under the marketing order. 

Small agricultural service firms are 

defined as those whose annual receipts 

are less than $6,000,000 and small 

agricultural producers have been 

defined by the Small Business 

Administration as those having annual 

receipts less than $750,000 (13 CFR 

121.201). 

Current industry information from the 

Board indicates that 35 of the 50 walnut 

handlers, or 70 percent, shipped less 

than $6,000,000 worth of walnuts and 

could be considered small businesses by 

the Small Business Administration. In 

addition, is it estimated that less than 1 

percent of walnut producers have 

annual receipts in excess of $750,000. 

Based on the foregoing, the majority of 

walnut producers and handlers 

regulated under the marketing order 

may be classified as small entities. 

This rule continues in effect an action 

that suspended provisions of the order 

pertaining to eligibility of members to 

serve on the Board. The order regulates 

the handling of walnuts grown in 

California, and the Board is responsible 

for local administration of the order. 

Specifically, this action suspends 

§ 984.38 of the order entitled 

‘‘Eligibility.’’

Due to structural changes in the 

industry, the order provisions regarding 

Board composition no longer accurately 

reflect the industry composition. If the 

eligibility requirements were not 

suspended, four of the Board members 

that represented the cooperative become 

ineligible to serve on the Board. 

However, these members continue to 

represent a significant portion of the 

industry. Suspending the order 

provision regarding eligibility of Board 

members allows a complete Board to 

remain in place. This action enables a 

Board that still represents the walnut 

industry to continue to administer the 

order without disruption while the 

order is being amended to reflect 

changes in the industry structure. The 

Board unanimously recommended 

suspending order language by mail 

balloting in early July 2005. 

Alternatives to this action were 

considered. One alternative was to 

remove the former cooperative members 

from the Board, which would result in 

a 6-member Board. This was not 

considered a preferred option because it 

would limit the size of the Board. 

This rule continues to suspend order 

language pertaining to membership 

eligibility on the Board. Accordingly, 

this action does not impose any 

additional reporting or recordkeeping 

requirements, or any other costs, on 

either small or large walnut 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. In addition, USDA has 

not identified any relevant Federal rules 

that duplicate, overlap, or conflict with 

this rule. 

An interim final rule concerning this 

action was published in the Federal 

Register on August 26, 2005 (70 FR 

50151). Copies of the rule were also 

mailed or sent via facsimile to all 

Walnut handlers. In addition, the rule 

was made available through the Internet 

by USDA and the Office of the Federal 

Register. That rule provided for a 60- 

day comment period which ended 

October 25, 2005. No comments were 

received. 

A small business guide on complying 

with fruit, vegetable, and specialty crop 

marketing agreements and orders may 

be viewed at the following Web site: 

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. 

After consideration of all relevant 

material presented, including the 

Board’s recommendation, and other 

information, it is found that the order 

language being suspended, as 

hereinafter set forth, no longer tends to 

effectuate the declared policy of the Act. 

List of Subjects in 7 CFR Part 984 

Walnuts, Marketing agreements, Nuts, 

Reporting and recordkeeping 

requirements. 

■ For the reasons set forth in the 

preamble, 7 CFR part 984 is amended as 

follows: 

PART 984—WALNUTS GROWN IN 

CALIFORNIA 

■ Accordingly, the interim final rule 

amending 7 CFR part 984 which was 

published at 70 FR 50151 on August 26, 

2005, is adopted as a final rule without 

change. 

Dated: November 22, 2005. 

Lloyd C. Day, 

Administrator, Agricultural Marketing 

Service. 

[FR Doc. 05–23552 Filed 12–1–05; 8:45 am] 

BILLING CODE 3410–02–P