Dried Prunes Produced in California; Decreased Assessment Rate

Federal Register: January 11, 2010 (Volume 75, Number 6)

Rules and Regulations

Page 1269-1271

From the Federal Register Online via GPO Access [wais.access.gpo.gov]

DOCID:fr11ja10-2

DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service 7 CFR Part 993

Doc. No. AMS-FV-09-0048; FV09-993-1 FIR

Dried Prunes Produced in California; Decreased Assessment Rate

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Affirmation of interim final rule as final rule.

SUMMARY: The Department of Agriculture (USDA) is adopting, as a final rule, without change, an interim final rule that decreased the assessment rate established for the Prune Marketing Committee

(Committee), for the 2009-10 and subsequent crop years from $0.30 to

$0.16 per ton of salable dried prunes. The Committee locally administers the marketing order that regulates the handling of dried prunes in California. The interim final rule was necessary to align the

Committee's expected revenue with decreases in its proposed budget for the 2009-10 and subsequent crop years, which began on August 1. The assessment rate will remain in effect indefinitely unless modified, suspended, or terminated.

DATES: Effective Date: January 12, 2010.

FOR FURTHER INFORMATION CONTACT: Debbie Wray, Marketing Specialist, or

Kurt J. Kimmel, Regional Manager, California Marketing Field Office,

Marketing Order Administration Branch, Fruit and Vegetable Programs,

AMS, USDA; Telephone: (559) 487-5901, Fax: (559) 487-5906, or E-mail:

Debbie.Wray@ams.usda.gov or Kurt.Kimmel@ams.usda.gov.

Small businesses may obtain information on complying with this, and other marketing order and agreement regulations by viewing a guide at the following Web site: http://www.ams.usda.gov/AMSv1.0/ ams.fetchTemplateData.do?template=TemplateN&page=MarketingOrdersSmallBus inessGuide; or 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@ams.usda.gov.

SUPPLEMENTARY INFORMATION: This rule is issued under Marketing

Agreement No. 110 and Marketing Order No. 993, both as amended (7 CFR part 993), regulating the handling of dried prunes 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 (USDA) is issuing this rule in conformance with Executive Order 12866.

Under the order, California dried prune handlers are subject to assessments, which provide funds to administer the order. Assessment rates issued under the order are intended to be applicable to all assessable salable dried prunes for the entire crop year, and continue indefinitely until amended, suspended, or terminated. The Committee's fiscal period begins on August 1 and ends on July 31.

In an interim final rule published in the Federal Register on

September 9, 2009, and effective on September 10, 2009 (74 FR 46310,

Doc. No. AMS-FV-09-0048; FV09-993-1 IFR), Sec. 993.347 was amended by decreasing the assessment rate established for the Committee for the 2009-10 and subsequent crop years from $0.30 to $0.16 per ton of

California salable dried prunes. The decrease in the per-ton assessment rate was possible due to significant decreases in operating expenses and contingencies, and a significant increase in the crop estimate for the 2009-10 crop year.

Page 1270

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.

There are approximately 900 producers of salable dried prunes in the production area and approximately 20 handlers subject to regulation under the marketing order. The Small Business Administration (13 CFR 121.201) defines small agricultural producers as those whose annual receipts are less than $750,000, and small agricultural service firms are defined as those whose annual receipts are less than $7,000,000.

Committee data indicates that about 64 percent of the handlers ship under $7,000,000 worth of dried prunes. Dividing the average prune crop value for 2008-09 reported by the National Agricultural Statistics

Service (NASS) of $196,080,000 by the number of producers (900) yields an average annual producer revenue estimate of about $217,867. Based on the foregoing, the majority of handlers and dried prune producers may be classified as small entities.

This rule continues in effect the action that decreased the assessment rate established for the Committee and collected from handlers for the 2009-10 and subsequent crop years from $0.30 to $0.16 per ton of salable dried prunes.

The Committee met on June 25, 2009, and unanimously recommended expenses of $54,138 and a decreased assessment rate of $0.16 per ton of salable dried prunes for the 2009-10 crop year. The Committee's budget of expenses of $54,138 includes a slight increase in personnel expenses and decreases in operating expenses and for contingencies. Most of the

Committee's expenses reflect its portion of the joint administrative costs of the Committee and the California Dried Plum Board (CDPB). The

Committee believes that extra assessment income carried in from the 2008 crop year, plus interest income and 2009-10 crop year assessment income, is adequate to cover its estimated expenses of $54,138.

The assessment rate of $0.16 per ton of salable dried prunes is

$0.14 per ton of salable dried prunes lower than the rate currently in effect. The quantity of salable dried prunes for the 2009-10 crop year is currently estimated at 160,000 tons, compared to 125,373 tons of salable dried prunes for the 2008-09 crop year.

The major expenditures recommended by the Committee for the 2009-10 crop year include $26,450 for salaries and benefits, $11,780 for operating expenses, and $15,908 for contingencies. In comparison, budgeted expenses for these items in 2008-09 were $26,248 for salaries and benefits, $12,893 for operating expenses, and $26,459 for contingencies.

The 2009-10 assessment rate was derived by considering the handler assessment revenue needed to meet anticipated expenses, the estimated salable tons of California dried prunes, excess funds carried forward into the 2009-10 crop year, and estimated interest income. Therefore, the Committee recommended an assessment rate of $0.16 per ton of salable dried prunes.

Prior to arriving at its budget of $54,138, the Committee considered information from various sources, including the Committee's

Executive Subcommittee. The Executive Subcommittee reviewed the administrative expenses shared between the Committee and the CDPB in recent years. The Executive Subcommittee then recommended the $54,138 budget and $0.16 per ton assessment rate to the Committee. The

Committee recommended the same budget and assessment rate to USDA.

Section 993.81(c) of the order provides the Committee the authority to use excess assessment funds from the 2008-09 crop year (estimated at

$28,533) for up to 5 months beyond the end of the crop year to meet 2009-10 crop year expenses, which are estimated to be $54,138. At the end of the 5 months, the Committee either refunds or credits excess funds to handlers.

To calculate the percentage of grower revenue represented by the assessment rate for 2008, the assessment rate of $0.30 per ton is divided by the estimated average grower price (according to the NASS).

This results in estimated assessment revenue for the 2008-09 crop year as a percentage of grower revenue of .02 percent ($0.30 divided by

$1,520 per ton). NASS data for 2009 is not yet available. However, applying the same calculations above using the average grower price for 2006-08 would result in estimated assessment revenue as a percentage of total grower revenue of .01 percent for the 2009-10 crop year ($0.16 divided by $1,453 per ton). Thus, the assessment revenue should be well below 1 percent of estimated grower revenue in 2009.

This action continues in effect the decreased assessment obligation imposed on handlers. Assessments are applied uniformly on all handlers, and some of the costs may be passed on to producers. However, decreasing the assessment rate reduces the burden on handlers, and may reduce the burden on producers. In addition, the Committee's meeting was widely publicized throughout the California dried prune industry and all interested persons were invited to attend the meeting and participate in Committee deliberations on all issues. Like all

Committee meetings, the June 25, 2009, meeting was a public meeting and all entities, both large and small, were able to express views on this issue.

This action imposes no additional reporting or recordkeeping requirements on either small or large dried prune 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.

Comments on the interim final rule were required to be received on or before November 9, 2009. No comments were received. Therefore, for the reasons given in the interim final rule, we are adopting the interim final rule as a final rule, without change.

To view the interim final rule, go to: http://www.regulations.gov/ search/Regs/home.html#documentDetail?R=0900006480a1f26c.

This action also affirms information contained in the interim final rule concerning Executive Orders 12866 and 12988, the Paperwork

Reduction Act (44 U.S.C. Chapter 35), and the E-Gov Act (44 U.S.C. 101).

After consideration of all relevant material presented, it is found that finalizing the interim final rule, without change, as published in the Federal Register (74 FR 46310, September 9, 2009) will tend to effectuate the declared policy of the Act.

List of Subjects in 7 CFR Part 993

Marketing agreements, Plums, Prunes, Reporting and recordkeeping requirements.

Page 1271

PART 993--DRIED PRUNES PRODUCED IN CALIFORNIA [AMENDED] 0

Accordingly, the interim final rule amending 7 CFR part 993 which was published at 74 FR 46310 on September 9, 2009, is adopted as a final rule, without change.

Dated: January 5, 2010.

Rayne Pegg,

Administrator, Agricultural Marketing Service.

FR Doc. 2010-163 Filed 1-8-10; 8:45 am

BILLING CODE 3410-02-P