Fresh Bartlett Pears Grown in Oregon and Washington; Increased Assessment Rate

AGENCY:

Agricultural Marketing Service, USDA.

ACTION:

Final rule.

SUMMARY:

This rule increases the assessment rate established for the Northwest Fresh Bartlett Pear Marketing Committee (Committee) for the 2001-2002 and subsequent fiscal periods from $0.02 to $0.025 per standard box of fresh Bartlett pears. The Committee locally administers the marketing order which regulates the handling of fresh Bartlett pears grown in Oregon and Washington. Authorization to assess fresh Bartlett pear handlers enables the Committee to incur expenses that are reasonable and necessary to administer the program. The fiscal period began July 1 and ends June 30. The assessment rate remains in effect indefinitely unless modified, suspended, or terminated.

EFFECTIVE DATES:

December 3, 2001.

FOR FURTHER INFORMATION CONTACT:

Gary D. Olson, Northwest Marketing Field Office, Fruit and Vegetable Programs, AMS, USDA, 1220 SW Third Avenue, suite 385, Portland, OR 97204; telephone: (503) 326-2724, Fax: (503) 326-7440 or George J. Kelhart, Technical Advisor, Marketing Order Administration Branch, Fruit and Vegetable Programs, AMS, USDA, room 2525-S, PO 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, room 2525-S, PO Box 96456, Washington, DC 20090-6456; telephone: (202) 720-2491, Fax: (202) 720-8938, or E-mail: Jay.Guerber@usda.gov.

SUPPLEMENTARY INFORMATION:

This rule is issued under Marketing Agreement No. 141 and Order No. 931 (7 CFR part 931), regulating the handling of fresh Bartlett pears grown in Oregon and Washington, 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 (USDA) is issuing this rule in conformance with Executive Order 12866.

This rule has been reviewed under Executive Order 12988, Civil Justice Reform. Under the order now in effect, fresh Bartlett pear 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 fresh Bartlett pears beginning July 1, 2001, and will continue until modified, 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 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. Such 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 increases the assessment rate established for the Committee for the 2001-2002 and subsequent fiscal periods from $0.02 to $0.025 per standard box of fresh Bartlett pears handled.

The fresh Bartlett pear marketing order provides authority for the Committee, with USDA's approval, to formulate an annual budget of expenses and collect assessments from handlers to administer the program. The Committee consists of eight grower members and six handler members, each of whom is 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 budget and assessment rate were discussed at a public meeting and all directly affected persons had an opportunity to participate and provide input.

For the 2000-2001 and subsequent fiscal periods, the Committee recommended, and USDA approved, an assessment rate of $0.02 per standard box that would continue in effect from fiscal period to fiscal period indefinitely unless modified, suspended, or terminated by USDA upon recommendation and information submitted by the Committee or other information available to USDA.

The Committee met on May 31, 2001, and unanimously recommended 2001-2002 expenditures of $76,477 and an assessment rate of $0.025 per standard box of fresh Bartlett pears handled. In comparison, last year's budgeted expenditures were $81,060. The assessment rate of $0.025 is $0.005 higher than the rate in effect prior to this final rule. The Committee recommended an increase in the assessment rate because the $0.02 rate would not have generated enough income to keep its operating reserve at a reasonable level (25,666). Without the increase, the operating reserve would drop below $7,000 which is not adequate administer the program.

Major expenses recommended by the Committee for the 2001-2002 fiscal period include $39,040 for salaries, $5,675 for office rent, and $3,911 for health insurance. Budgeted expenses for these items in 2000-2001 were $44,468, $4,847, and $3,891, respectively.

The Committee developed the $0.025 assessment rate recommendation by considering the 2001-2002 budget and crop estimate, as well as the relatively small size of the current monetary reserve. Assessment income for the fiscal period should approximate $79,700 based on estimated fresh Bartlett pear shipments of 3,188,000 standard boxes, which is adequate to cover budgeted expenses. Funds in the reserve (approximately $18,443) will be kept within the maximum permitted by the order of approximately one fiscal period's operational expenses (§ 931.42).

The assessment rate established in this rule will continue in effect indefinitely unless modified, suspended, or terminated by USDA upon recommendation and information submitted by the Committee or other available information.

Although this assessment rate will remain in effect for an indefinite period, the Committee will continue to meet prior to or during each fiscal period 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 USDA. Committee meetings are open to the public and interested persons may express their views at these meetings. The USDA will evaluate Committee recommendations and other available information to determine whether modification of the assessment rate is needed. Further rulemaking will be undertaken as necessary. The Committee's 2001-2002 budget has been reviewed and approved by USDA. Those for subsequent fiscal periods will also be reviewed and, as appropriate, approved by USDA.

Final 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 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 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 1,600 producers of fresh Bartlett pears in the production area and approximately 54 handlers subject to regulation under the marketing order. Small agricultural producers are defined by the Small Business Administration (13 CFR 121.201) as those having annual receipts of less than $750,000 and small agricultural service firms are defined as those whose annual receipts are less than $5,000,000.

Based on data provided by the National Agricultural Statistics Service for 1999, the most recent year complete data is available, and the current number of producers, the average annual producer revenue in Washington and Oregon could approximate $23,130 this year. Further, based on Committee records and recent F.O.B. prices reported by the Fruit and Vegetable Market News Service for fresh Bartlett pears, over 98 percent of the regulated handlers ship less that $5,000,000 worth of fresh Bartlett pears on an annual basis. In view of the foregoing, it can be concluded that the majority of fresh Bartlett pear producers and handlers may be classified as small entities.

This rule increases the assessment rate established for the Committee and collected from handlers for the 2001-2002 and subsequent fiscal periods from $0.02 to $0.025 per standard box of fresh Bartlett pears handled. The Committee met on May 31, 2001, and unanimously recommended 2001-2002 expenditures of $76,477 and an assessment rate of $0.025 per standard box of fresh Bartlett pears handled. In comparison, budgeted expenditures for last year totaled $81,060. The assessment rate of $0.025 is $0.005 greater than the rate in effect prior to this final rule, and was recommended by the Committee because the $0.02 rate would not have generated enough income for it to adequately administer the program. At the previous rate of assessment, the Committee's monetary reserve would have dropped below $7,000 and this is not adequate to administer the program.

Major expenses recommended by the Committee for the 2001-2002 fiscal period include $39,040 for salaries, $5,675 for office rent, and $3,911 for health insurance. Budgeted expenses for these items in 2000-2001 were $44,468, $4,847, and $3,891, respectively.

The Committee developed the $0.025 assessment rate recommendation by considering the 2001-2002 budget and crop estimate, as well as the relatively small size of its monetary reserve. Assessment income for the fiscal period should approximate $79,700 based on estimated fresh Bartlett pear shipments of 3,188,000 standard boxes, which is adequate to cover budgeted expenses. Funds in the reserve (approximately $18,443) will be kept within the maximum permitted by the order of approximately one fiscal period's operational expenses (§ 931.42).

The Committee considered alternative levels of assessment but, considering the current relatively low level of funding in the monetary reserve, determined that increasing the assessment rate to $0.025 per standard box to be appropriate. The Committee believes that an assessment rate of more than $0.025 per standard box would have generated income in excess of that needed to adequately administer the program, and if left at the $0.02 rate, or reduced, would have been inadequate to administer the program.

A review of historical information and preliminary information pertaining to the upcoming crop indicates that the producer price for the 2001-2002 marketing season could average about $11.61 per standard box of fresh Bartlett pears handled. Therefore, the Committee's estimated assessment revenue for the 2001-2002 fiscal period as a percentage of total producer revenue should be approximately 0.215 percent.

This action increases 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 are offset by the benefits derived by the operation of the order. In addition, the Committee's meeting was widely publicized throughout the fresh Bartlett pear industry and all interested persons were invited to attend the meeting and participate in Committee deliberations on all issues. Like all Committee meetings, the May 31, 2001, meeting was a public meeting and all entities, both large and small, were able to express views on this issue. Furthermore, interested persons were invited to submit information on the regulatory and informational impacts of this action on small businesses.

This rule imposes no additional reporting or recordkeeping requirements on either small or large fresh Bartlett pear 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 USDA has not identified any relevant Federal rules that duplicate, overlap, or conflict with this rule.

A proposed rule concerning this action was published in the Federal Register on September 21, 2001 (66 FR 48628). A copy of the proposed ruled was provided to the Committee office which in turn made copies available to producers and handlers. Furthermore, the Office of the Federal Register and the USDA made a copy available on the Internet. A 30-day comment period ending October 22, 2001, was provided for interested persons to respond to the proposal. No comments were received.

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.

After consideration of all relevant material presented, including the information and recommendation submitted by the Committee 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.

Pursuant to 5 U.S.C. 553, it is also found and determined that good cause exists for not postponing the effective date of this rule until 30 days after publication in the Federal Register because: (1) Handlers are already receiving 2001-2002 fiscal period pears from producers; (2) the 2001-2002 fiscal period began on July 1, 2001, and the order requires that the rate of assessment for each fiscal period apply to all assessable Bartlett pears handled during such period; and (3) handlers are aware of this action which was unanimously recommended by the Committee at a public meeting. Furthermore, a 30-day comment period was provided for in the proposed rule and no comments were received.

List of Subjects in 7 CFR Part 931

• Marketing agreements
• Pears
• Reporting and recordkeeping requirements

For the reasons set forth in the preamble, 7 CFR part 931 is amended as follows:

PART 931—FRESH BARTLETT PEARS GROWN IN OREGON AND WASHINGTON

1. The authority citation for 7 CFR part 931 continues to read as follows:

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

2. Section 931.231 is revised to read as follows: