Avocados Grown in South Florida; Increased Assessment Rate
| Published date | 24 August 2021 |
| Citation | 86 FR 47248 |
| Record Number | 2021-18067 |
| Section | Proposed rules |
| Court | Agricultural Marketing Service |
Federal Register, Volume 86 Issue 161 (Tuesday, August 24, 2021)
[Federal Register Volume 86, Number 161 (Tuesday, August 24, 2021)]
[Proposed Rules]
[Pages 47248-47251]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-18067]
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DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 915
[Doc. No. AMS-SC-21-0040]
Avocados Grown in South Florida; Increased Assessment Rate
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Proposed rule.
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SUMMARY: This proposed rule would implement an Avocado Administrative
Committee recommendation to increase the assessment rate established
for the 2021-22 and subsequent fiscal years. The proposed assessment
rate would remain in effect indefinitely unless modified, suspended, or
terminated.
DATES: Comments must be received by September 23, 2021.
ADDRESSES: Interested persons are invited to submit written comments
concerning this proposed rule. Comments must be submitted on the
internet at: https://www.regulations.gov. Comments should reference the
document number and the date and page number of this issue of the
Federal Register and will be available for public
[[Page 47249]]
inspection in the Office of the Docket Clerk during regular business
hours, or can be viewed at: https://www.regulations.gov. All comments
submitted in response to this proposed rule will be included in the
record and will be made available to the public. Please be advised that
the identity of individuals or entities submitting comments will be
made public on the internet at the address provided above.
FOR FURTHER INFORMATION CONTACT: Abigail Campos, Marketing Specialist,
or Christian D. Nissen, Regional Director, Southeast Marketing Field
Office, Marketing Order and Agreement Division, Specialty Crops
Program, AMS, USDA; Telephone: (863) 324-3375, Fax: (863) 291-8614, or
Email: [email protected] or [email protected].
Small businesses may request information on complying with this
regulation by contacting Richard Lower, Marketing Order and Agreement
Division, Specialty Crops Program, AMS, USDA, 1400 Independence Avenue
SW, STOP 0237, Washington, DC 20250-0237; Telephone: (202) 720-2491, or
Email: [email protected].
SUPPLEMENTARY INFORMATION: This action, pursuant to 5 U.S.C. 553,
proposes an amendment to regulations issued to carry out a marketing
order as defined in 7 CFR 900.2(j). This proposed rule is issued under
Marketing Agreement No. 121 and Marketing Order No. 915, both as
amended (7 CFR part 915), regulating the handling of avocados grown in
south Florida. Part 915, (referred to as ``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 Avocado
Administrative Committee (Committee) locally administers the Order and
is comprised of growers and handlers operating within the area of
production, and a public member.
The Department of Agriculture (USDA) is issuing this proposed rule
in conformance with Executive Orders 12866 and 13563. Executive Orders
12866 and 13563 direct agencies to assess all costs and benefits of
available regulatory alternatives and, if regulation is necessary, to
select regulatory approaches that maximize net benefits (including
potential economic, environmental, public health and safety effects,
distributive impacts and equity). Executive Order 13563 emphasizes the
importance of quantifying both costs and benefits, reducing costs,
harmonizing rules, and promoting flexibility. This action falls within
a category of regulatory actions that the Office of Management and
Budget (OMB) exempted from Executive Order 12866 review.
This proposed rule has been reviewed under Executive Order 13175--
Consultation and Coordination with Indian Tribal Governments, which
requires agencies to consider whether their rulemaking actions would
have tribal implications. AMS has determined that this proposed rule is
unlikely to have substantial direct effects on one or more Indian
tribes, on the relationship between the Federal Government and Indian
tribes, or on the distribution of power and responsibilities between
the Federal Government and Indian tribes.
This proposed rule has been reviewed under Executive Order 12988,
Civil Justice Reform. Under the marketing Order now in effect, Florida
avocado 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 Florida avocados for the 2021-22 fiscal year, and continue
until amended, suspended, or terminated.
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 proposed rule would increase the assessment rate established
for the Committee for the 2021-22 and subsequent fiscal years from
$0.35 to $0.45 per 55-pound bushel container of avocados.
The Order provides authority for the Committee, with the approval
of USDA, to formulate an annual budget of expenses and collect
assessments from handlers to administer the program. Nine of ten
members of the Committee are producers and handlers of Florida
avocados. They are familiar with the Committee's needs and with costs
for goods and services in their local area and are able to formulate an
appropriate budget and assessment rate. The assessment rate is
formulated and discussed in a public meeting and all directly affected
persons have an opportunity to participate and provide input.
For the 2016-17 and subsequent fiscal years, the Committee
recommended, and USDA approved, an assessment rate that would continue
in effect from fiscal year to fiscal year 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 April 14, 2021 and recommended 2021-22
expenditures of $348,484 and an assessment rate of $0.45 per 55-pound
bushel container of avocados. In comparison, last year's budgeted
expenditures were $280,484. The assessment rate of $0.45 is $0.10
higher than the rate currently in effect. During the last few seasons,
the Committee has not funded research projects. However, the laurel
wilt disease continues to challenge the avocado industry. The Committee
discussed the need for research funding and added $80,000 to its
proposed budget for this research and recommended increasing the
assessment rate to cover the additional expense. At the current
assessment rate, assessment income would equal only $280,000, an amount
insufficient to cover the Committee's anticipated expenditures of
$348,484. By increasing the assessment rate by $0.10, assessment income
would be $360,000. This amount should provide sufficient funds to meet
2021-2022 anticipated expenses.
Major expenditures recommended by the Committee for the 2021-22
year include $116,164 for salaries, $80,000 for research, and $53,350
for employee benefits. Budgeted expenses for these items in 2020-21
were $116,164, $0, and $53,350, respectively.
The assessment rate recommended by the Committee was derived by
reviewing anticipated expenses, expected shipments of Florida avocados,
and the amount of funds in reserve. Avocado shipments for the year are
estimated at 800,000 55-pound bushel containers, which, as mentioned
before, should provide $360,000 in assessment income (80,000 containers
x $0.45). Income derived from handler assessments at the proposed rate,
along with interest income, should be adequate to cover budgeted
expenses. Funds in the reserve (currently about $250,000) are expected
to be kept within the maximum permitted by the Order
[[Page 47250]]
(approximately three fiscal years' expenses as authorized in Sec.
915.42).
The proposed assessment rate would 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 would be in effect for an indefinite
period, the Committee will continue to meet prior to or during each
fiscal year to recommend a budget of expenses and consider
recommendations for modification of the assessment rate. 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. USDA 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 2021-22 budget and those
for subsequent fiscal years would be reviewed and, as appropriate,
approved by USDA.
Initial Regulatory Flexibility Analysis
Pursuant to requirements set forth in the Regulatory Flexibility
Act (RFA) (5 U.S.C. 601-612), the Agricultural Marketing Service (AMS)
has considered the economic impact of this proposed 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
businesses 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.
There are approximately 325 producers of Florida avocados in the
production area and 25 handlers subject to regulation under the
marketing order. Small agricultural producers are defined by the Small
Business Administration (SBA) as those having annual receipts less than
$1,000,000, and small agricultural service firms are defined as those
whose annual receipts are less than $30,000,000 (13 CFR 121.201).
According to the National Agricultural Statistical Service (NASS),
the average grower price paid for Florida avocados during the 2020-21
season was $21.97 per 55-pound bushel. Utilized production was
equivalent to 624,364 55-pound bushels for a total value of over
$13,718,830. Dividing the crop value by the estimated number of
producers (325) yields an estimated average receipt per producer of
$42,212, so the majority of producers would have annual receipts of
less than $1,000,000.
USDA Market News reported April 2021 terminal market prices for
green skinned avocados were about $36.43 per 24-pound container. Using
this price and the total utilization, the total 2020-21 handler crop
value is estimated at $52.1 million. Dividing this figure by the number
of handlers (25) yields an estimated average annual handler receipts of
over $2 million, which is below the SBA threshold for small
agricultural service firms. Thus, the majority of Florida avocado
producers and handlers are classified as small entities.
This proposal would increase the assessment rate established for
the Committee and collected from handlers for the 2021-22 and
subsequent fiscal years from $0.35 to $0.45 per 55-pound bushel
container of avocados. The Committee recommended 2021-22 expenditures
of $348,484 and an assessment rate of $0.45 per 55-pound bushel
container. The proposed assessment rate of $0.45 is $0.10 higher than
the previous rate. The quantity of assessable avocados for the 2021-22
season is estimated at 800,000 55-pound bushel containers. Thus, the
$0.45 rate should provide $360,000 in assessment income and be adequate
to meet this year's expenses.
Major expenditures recommended by the Committee for the 2021-22
fiscal year include $116,164 for salaries, $80,000 for research, and
$53,350 for employee benefits. Budgeted expenses for these items in
2020-21 were $116,164, $0, and $53,350, respectively.
In recent years, the Committee did not fund any research. However,
Committee members believe further research is needed to address laurel
wilt disease and voted to commit $80,000 to research in the coming
fiscal year. At the current assessment rate and with the 2021-22 crop
estimated to be 800,000 55-pound bushel containers, assessment income
would equal only $280,000, an amount insufficient to cover the
Committee's anticipated expenditures of $348,484. By increasing the
assessment rate by $0.10, assessment income would be approximately
$360,000. This amount should provide sufficient funds to meet 2021-22
anticipated expenses. Consequently, the Committee recommended
increasing the assessment rate.
Prior to arriving at this budget and assessment rate, the Committee
considered information from various sources, including its Research
Subcommittee. The Committee discussed alternative expenditure levels
based upon the relative value of various activities to the south
Florida avocado industry. The Committee ultimately determined that
2021-22 expenditures of $348,484, including additional funds for
research, were appropriate, and the recommended assessment rate, along
with interest income, should generate sufficient revenue to meet its
expenses.
A review of historical information and preliminary information
pertaining to the upcoming season indicates that the grower price for
the 2021-22 season should be around $20-25 per 55-pound bushel
container of avocados. Therefore, the estimated assessment revenue for
the 2021-22 fiscal year as a percentage of total grower revenue would
be between 1.8 and 2.25 percent.
This action would increase the assessment obligation imposed on
handlers. While assessments impose some additional costs on handlers,
these costs are minimal and uniform on all handlers. Additionally,
these costs would be offset by benefits derived by the operation of the
marketing order.
The Committee's meeting was widely publicized throughout the
Florida avocado industry and all interested persons were invited to
attend the meeting and participate in Committee deliberations on all
issues. Like all Committee meetings, the April 14, 2021 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 comments on this proposed rule, including the regulatory and
informational impacts of this action on small businesses.
In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C.
Chapter 35), the Order's information collection requirements have been
previously approved by the Office of Management and Budget (OMB) and
assigned OMB No. 0581-0189 Fruit Crops. No changes in those
requirements would be necessary as a result of this proposed rule.
Should any changes become necessary, they would be submitted to OMB for
approval.
This proposed rule would not impose any additional reporting or
recordkeeping requirements on either small or large Florida avocado
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.
[[Page 47251]]
AMS is committed to complying with the E-Government Act, to promote
the use of the internet and other information technologies to provide
increased opportunities for citizen access to Government information
and services, and for other purposes.
USDA has not identified any relevant Federal rules that duplicate,
overlap, or conflict with this action.
A small business guide on complying with fruit, vegetable, and
specialty crop marketing agreements and orders may be viewed at:
https://www.ams.usda.gov/rules-regulations/moa/small-businesses. Any
questions about the compliance guide should be sent to Richard Lower 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.
List of Subjects in 7 CFR Part 915
Avocados, Marketing agreements, Reporting and recordkeeping
requirements.
For reasons set forth in the preamble, 7 CFR part 915 is proposed
to be amended as follows:
PART 915--AVOCADOS GROWN IN SOUTH FLORIDA
0
1. The authority citation for 7 CFR part 915 continues to read as
follows:
Authority: 7 U.S.C. 601-674.
0
2. Section 915.235 is revised to read as follows:
Sec. 915.235 Assessment rate.
On and after April 1, 2021, an assessment rate of $0.45 per 55-
pound container or equivalent is established for avocados grown in
South Florida.
Erin Morris,
Associate Administrator, Agricultural Marketing Service.
[FR Doc. 2021-18067 Filed 8-23-21; 8:45 am]
BILLING CODE P
