65FR37300 Hazelnuts Grown in Oregon and Washington; Increased Assessment Rate
robop...@us.govnews.org
Posting-number: Volume 65, Issue 115, Page 37300
[Federal Register: June 14, 2000 (Volume 65, Number 115)]
[Proposed Rules]
[Page 37300-37302]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr14jn00-20]
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DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 982
[Docket No. FV00-982-2 PR]
Hazelnuts Grown in Oregon and Washington; Increased Assessment
Rate
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Proposed rule.
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SUMMARY: This rule would increase the assessment rate established for
the Hazelnut Marketing Board (Board) for the 2000-2001 and subsequent
marketing years from $0.004 to $0.005 per pound of hazelnuts handled.
The Board locally administers the marketing order, which regulates the
handling of hazelnuts grown in Oregon and Washington. Authorization to
assess hazelnut handlers enables the Board to incur expenses that are
reasonable and necessary to administer the program. The marketing year
begins July 1 and ends June 30. The assessment rate would remain in
effect indefinitely unless modified, suspended, or terminated.
DATES: Comments must be received by July 14, 2000.
ADDRESSES: Interested persons are invited to submit written comments
concerning this rule. 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) 720-5698, or E-mail: moab.doc...@usda.gov. 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, or can be
viewed at: http://www.ams.usda.gov/fv/moab.html.
FOR FURTHER INFORMATION CONTACT: Teresa L. Hutchinson, Northwest
Marketing Field Office, Fruit and Vegetable Programs, AMS, USDA, 1220
SW Third Avenue, suite 385, Portland, Oregon 97204; telephone: (503)
326-2724, Fax: (503) 326-7440; 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) 720-5698.
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) 720-5698, or E-mail: Jay.G...@usda.gov.
SUPPLEMENTARY INFORMATION: This rule is issued under Marketing
Agreement No. 115 and Order No. 982, both as amended (7 CFR part 982),
regulating the handling of hazelnuts grown in Oregon and Washington,
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, hazelnut
handlers are subject to assessments. Funds to administer the order are
derived from such assessments. It is intended that the assessment rate
as proposed herein would be applicable to all assessable hazelnuts
beginning on July 1, 2000, and continue until amended, suspended, or
terminated. 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. 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
Board for the 2000-2001 and subsequent marketing years from $0.004 to
$0.005 per pound of hazelnuts handled.
The order provides authority for the Board, 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
Board are producers and handlers of hazelnuts. They are familiar with
the Board'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 and budget were
recommended by a mail vote. The recommendation will be discussed and
reconfirmed at the Board's next scheduled public meeting. Thus, all
directly affected persons will have an opportunity to participate and
provide input.
For the 1997-98 and subsequent marketing years, the Board
recommended, and the Department approved, an assessment rate that would
continue in effect from marketing year to marketing year unless
modified, suspended, or terminated by the Secretary upon recommendation
and information submitted by the Board or other information available
to the Secretary.
The Board, in a mail vote completed at the end of April 2000,
unanimously recommended 2000-2001 expenditures of $596,293 and an
assessment rate of $0.005 per pound of hazelnuts. In comparison, last
year's budgeted expenditures were $568,457. The assessment rate of
$0.005 is $0.001 higher than the rate currently in effect. At the
current rate of $0.004 per pound and an estimated 2000-2001 hazelnut
[[Page 37301]]
production of 50,000,000 pounds, the Board believes that the projected
reserve on June 30, 2001, would not be adequate to administer the
program. The increased assessment rate is expected to result in an
operating reserve of $150,147 at the end of the 2000-2001 marketing
year.
The major expenditures recommended by the Board for the 2000-2001
marketing year include $39,613 for personal services (salaries and
benefits), $7,416 for rent, $5,000 for compliance, $23,000 for the crop
estimate, $275,000 for promotion, and $182,364 for an emergency fund.
Budgeted expenses for these items in 1999-2000 were $51,385, $7,308,
$5,000, $21,000, $275,000, and $182,364, respectively. The Board would
consider using emergency funds for authorized activities when it is
reasonably certain that its estimate of assessable hazelnuts is
reached. It would not be able to make this determination until December
2000, the month in which the hazelnut harvest and deliveries to
handlers usually are completed.
The Board based its recommended assessment rate increase on the
2000-2001 crop estimate, the 2000-2001 marketing year expenditures
estimate, as well as the current and projected balance of the operating
reserve. Hazelnut shipments for the 2000-2001 marketing year are
estimated at 50,000,000 pounds, which should provide $250,000 in
assessment income. Income derived from handler assessments, along with
interest income ($13,000) and funds from the Board's authorized reserve
($333,293), would be adequate to cover budgeted expenses. Funds in the
reserve (currently $483,440) would be kept within the maximum permitted
by the order (approximately one marketing year's operational expenses).
Excess funds may be maintained and used by the Board until December 1
following the end of a marketing year (Sec. 982.62(b)). The Board shall
refund to each handler upon request, or credit to the handler's account
with the Board, the handler's share of such excess prior to January 1.
The proposed assessment rate would continue in effect indefinitely
unless modified, suspended, or terminated by the Secretary upon
recommendation and information submitted by the Board or other
available information.
Although this assessment rate would be in effect for an indefinite
period, the Board would continue to conduct a mail vote prior to or
during each marketing year to recommend a budget of expenses and
consider recommendations for modification of the assessment rate. Any
mail votes would be discussed and reconfirmed at a public meeting. The
dates and times of Board meetings are available from the Board or the
Department. Board meetings are open to the public and interested
persons may express their views at these meetings. The Department would
evaluate Board recommendations and other available information to
determine whether modification of the assessment rate is needed.
Further rulemaking would be undertaken as necessary. The Board's 2000-
2001 budget and those for subsequent marketing 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, the 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 800 producers of hazelnuts in the
production area and approximately 22 handlers subject to regulation
under the marketing order. Small agricultural producers are defined by
the Small Business Administration (SBA) (13 CFR 121.201) as those
having annual receipts less than $500,000, and small agricultural
service firms are defined as those whose annual receipts are less than
$5,000,000. Currently, about 86 percent of hazelnut handlers could be
considered small businesses under SBA's definition, excluding receipts
from other sources. It is estimated that virtually all hazelnut
producers have annual receipts of less than $500,000, excluding
receipts from other sources. Thus, the majority of handlers and
producers of hazelnuts may be classified as small entities.
This rule would increase the assessment rate established for the
Board and collected from handlers for the 2000-2001 and subsequent
marketing years from $0.004 to $0.005 per pound of hazelnuts. The
Board, in a mail vote completed at the end of April 2000, unanimously
recommended 2000-2001 expenditures of $596,293 and an assessment rate
of $0.005 per pound. The proposed assessment rate of $0.005 per pound
is $0.001 higher than the $0.004 per pound rate currently in effect.
The quantity of assessable hazelnuts for the 2000-2001 marketing year
is estimated at 50,000,000 pounds. Income derived from handler
assessments, along with interest income and funds from the Board's
authorized reserve, would be adequate to cover budgeted expenses.
The major expenditures recommended by the Board for the 2000-2001
marketing year include $39,613 for personal services (salaries and
benefits), $7,416 for rent, $5,000 for compliance, $23,000 for the crop
estimate, $275,000 for promotion, and $182,364 for an emergency fund.
Budgeted expenses for these items in 1999-2000 were $51,385, $7,308,
$5,000, $21,000, $275,000, and $182,364, respectively. As mentioned
earlier, the Board would not make any decision on using emergency funds
until December 2000, at the earliest.
The Board based its recommended assessment rate increase on the
2000-2001 crop estimate, the 2000-2001 marketing year expenditures
estimate, as well as the current and projected balance of the operating
reserve. Hazelnut shipments for the 2000-2001 marketing year are
estimated at 50,000,000 pounds, which should provide $250,000 in
assessment income. Income derived from handler assessments, along with
interest income ($13,000) and funds from the Board's authorized reserve
($333,293), would be adequate to cover budgeted expenses. Funds in the
reserve (currently $483,440) would be kept within the maximum permitted
by the order (approximately one marketing year's operational expenses).
Excess funds may be maintained and used by the Board until December 1
following the end of a marketing year (Sec. 982.62(b)). The Board is
required to refund or credit, upon request, each handler's share of the
excess prior to January 1.
The Board reviewed and unanimously recommended 2000-2001
expenditures of $596,293. With the 2000-2001 marketing year assessable
hazelnut crop estimated at 50,000,000 pounds, or 26,000,000 pounds less
than for 1999-2000, the Board recommended the assessment rate increase
to prevent its operating reserve from going lower than $150,000. The
Board believes that a reserve less than this is too low. Prior to
arriving at this budget, the Board considered information from various
sources, such as the Proration Committee, the Budget Committee, and the
Marketing and Promotion Committee. Alternative expenditure levels were
discussed by these groups,
[[Page 37302]]
based upon the relative value of various research, marketing, and
promotion projects to the hazelnut industry.
A review of historical information and preliminary information
pertaining to the upcoming marketing year indicates that the grower
price for the 2000-2001 marketing year could range between $0.32 and
$0.49 per pound of hazelnuts. Therefore, the estimated assessment
revenue for the 2000-2001 marketing year as a percentage of total
grower revenue could range between 1.02 and 1.56 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, 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 hazelnut 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 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 proposed rule. Thirty days is deemed appropriate
because: (1) The 2000-2001 marketing year begins on July 1, 2000, and
the marketing order requires that the rate of assessment for each
marketing year apply to all assessable hazelnuts handled during such
marketing year; (2) the Board needs to have sufficient funds to pay its
expenses which are incurred on a continuous basis; and (3) handlers are
aware of this action which was unanimously recommended by the Board in
a mail vote and is similar to other assessment rate actions issued in
past years.
List of Subjects in 7 CFR Part 982
Filberts, Hazelnuts, Marketing agreements, Nuts, Reporting and
recordkeeping requirements.
For the reasons set forth in the preamble, 7 CFR part 982 is
proposed to be amended as follows:
PART 982--HAZELNUTS GROWN IN OREGON AND WASHINGTON
1. The authority citation for 7 CFR part 982 continues to read as
follows:
Authority: 7 U.S.C. 601-674.
2. Section 982.340 is revised to read as follows:
Sec. 982.340 Assessment rate.
On and after July 1, 2000, an assessment rate of $0.005 per pound
is established for Oregon and Washington hazelnuts.
Dated: June 8, 2000.
James R. Frazier,
Acting Deputy Administrator, Fruit and Vegetable Programs.
[FR Doc. 00-15014 Filed 6-13-00; 8:45 am]
BILLING CODE 3410-02-P