[Federal Register Volume 63, Number 196 (Friday, October 9, 1998)]
[Rules and Regulations]
[Pages 54342-54344]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-27182]
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DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 948
[Docket No. FV98-948-1 FIR]
Irish Potatoes Grown in Colorado; Decreased Assessment Rate
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Final rule.
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SUMMARY: The Department of Agriculture (Department) is adopting, as a
final rule, without change, the provisions of an interim final rule
which decreased the assessment rate, from $0.0030 to $0.0015 per
hundredweight of potatoes handled, established for the Colorado Potato
Administrative Committee, San Luis Valley Office (Area II) (Committee)
under Marketing Order No. 948 for the 1998-99 and subsequent fiscal
periods. The Committee is responsible for local administration of the
marketing order which regulates the handling of potatoes grown in
Colorado. Authorization to
[[Page 54343]]
assess potato handlers enables the Committee to incur expenses that are
reasonable and necessary to administer the program. The fiscal period
began on September 1 and ends August 31. The assessment rate will
continue in effect indefinitely unless modified, suspended, or
terminated.
EFFECTIVE DATE: November 9, 1998.
FOR FURTHER INFORMATION CONTACT: Dennis L. West, Northwest Marketing
Field Office, Fruit and Vegetable Programs, AMS, USDA, 1220 SW Third
Avenue, Room 369, Portland, OR 97204; telephone: (503) 326-2724, Fax:
(503) 326-7440, or George J. Kelhart, 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)
205-6632. Small businesses may request information on compliance with
this regulation by contacting Jay Guerber, 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) 205-6632.
SUPPLEMENTARY INFORMATION: This rule is issued under Marketing
Agreement No. 97 and Order No. 948, both as amended (7 CFR part 948),
regulating the handling of Irish potatoes grown in Colorado,
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 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, Colorado
potato 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
potatoes beginning September 1, 1998, and continue until amended,
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 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 continues to decrease the assessment rate established for
the Committee for the 1998-99 and subsequent fiscal periods from
$0.0030 to $0.0015 per hundredweight of potatoes handled.
The Colorado potato marketing order provides authority for the
Committee, 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 Committee are producers and handlers of
Colorado Area II potatoes. They are 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 assessment rate is formulated and discussed in a public
meeting. Thus, all directly affected persons have an opportunity to
participate and provide input.
In Colorado, both a State and a Federal marketing order operate
simultaneously. The State order authorizes promotion, including paid
advertising, which the Federal order does not. All expenses in this
category are financed under the State order. The jointly operated
programs consume about equal administrative time and the two orders
continue to split administrative costs equally.
For the 1996-97 and subsequent fiscal periods, the Committee
recommended, and the Department approved, an assessment rate that would
continue in effect from fiscal period to fiscal period indefinitely
unless modified, suspended, or terminated by the Secretary upon
recommendation and information submitted by the Committee or other
information available to the Secretary.
The Committee met on May 21, 1998, and recommended, by a nine to
one vote, 1998-99 expenditures of $66,895 and an assessment rate of
$0.0015 per hundredweight of potatoes. The Committee member voting no
objected to the amount being budgeted for the executive director's
salary, but had no problem with the total amount budgeted or the
reduction in the assessment rate. In comparison, last year's budgeted
expenditures were $63,329. The assessment rate of $0.0015 is $0.0015
less than the rate previously in effect. The Committee voted to lower
the assessment rate and use some of the funds in its operating reserve
to bring the reserve closer to the amount it believes necessary to
administer the program. The decrease will reduce the financial burden
on handlers as prices for San Luis Valley potatoes have been extremely
low the past two seasons. Overproduction of the 1996 fall crop and
unusually cold weather during the 1997 fall crop growing season
resulted in major financial disasters within the San Luis Valley potato
industry. The Committee discussed various assessment rates, but decided
that an assessment rate of less than $0.0015 would not generate the
income necessary to administer the program with an adequate reserve.
Major expenses recommended by the Committee for the 1998-99 fiscal
period include $37,210 for salaries, $10,850 for office expenses, which
include telephone, supplies, and postage, and $5,250 for building
maintenance, which includes insurance and utilities. Budgeted expenses
for these items in 1997-98 were $35,579, $9,500, and $5,250,
respectively.
The assessment rate recommended by the Committee was derived by
dividing anticipated expenses by expected shipments of Colorado Area II
potatoes. Potato shipments for the year are estimated at 16,500,000
hundredweight which should provide $24,750 in assessment income. Income
derived from handler assessments, along with funds from the Committee's
authorized reserve, will be adequate to cover budgeted expenses. Funds
in the reserve ($124,903 as of September 1, 1997) will be kept within
the maximum permitted by the order (less than approximately two fiscal
periods' expenses; Sec. 948.78).
The assessment rate established in this rule will continue in
effect indefinitely unless modified, suspended, or terminated by the
Secretary upon recommendation and information submitted by the
Committee or other available information.
Although this assessment rate is effective 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 the
Department. Committee meetings are
[[Page 54344]]
open to the public and interested persons may express their views at
these meetings. The Department 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 1998-99 budget and those for subsequent
fiscal periods will 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 action 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 285 producers of Colorado Area II potatoes
in the production area and approximately 100 handlers subject to
regulation under the marketing order. Small agricultural producers have
been defined by the Small Business Administration (13 CFR 121.601) 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. The majority of Colorado Area II potato producers and
handlers may be classified as small entities.
This rule continues to decrease the assessment rate established for
the Committee and collected from handlers for the 1998-99 and
subsequent fiscal periods from $0.0030 to $0.0015 per hundredweight of
potatoes handled. The Committee by a nine to one vote recommended 1998-
99 expenditures of $66,895 and an assessment rate of $0.0015 per
hundredweight of potatoes handled. The Committee member voting no
objected to the amount being budgeted for the executive director's
salary but had no problem with the total amount budgeted or the
reduction in the assessment rate. In comparison, last year's budgeted
expenditures were $63,329. The assessment rate of $0.0015 is $0.0015
lower than the 1997-98 rate. The Committee voted to lower the
assessment rate and use some of the funds in its operating reserve to
bring the reserve closer to the amount it believes necessary to
administer the program. The decrease will reduce the financial burden
on handlers as prices for San Luis Valley potatoes have been extremely
low the past two seasons. Overproduction of the 1996 fall crop and
unusually cold weather during the 1997 fall crop growing season
resulted in major financial disasters within the San Luis Valley potato
industry. The Committee discussed various assessment rates but decided
that an assessment rate of less than $0.0015 would not generate the
income necessary to administer the program with an adequate reserve.
Major expenses recommended by the Committee for the 1998-99 fiscal
period include $37,210 for salaries, $10,850 for office expenses, which
include telephone, supplies, and postage, and $5,250 for building
maintenance which includes insurance and utilities. Budgeted expenses
for these items in 1997-98 were $35,579, $9,500, and $5,250,
respectively.
With Colorado Area II potato shipments for 1998-99 estimated at
16,500,000 hundredweight, the $0.0015 rate of assessment should provide
$24,750 in assessment income. Income derived from handler assessments,
along with funds from the Committee's authorized reserve, will be
adequate to cover budgeted expenses. Funds in the reserve ($124,903 as
of September 1, 1997) will be kept within the maximum permitted by the
order (less than approximately two fiscal periods' expenses;
Sec. 948.78).
Recent price information indicates that the grower price for the
1998-99 marketing season will range between $1.60 and $6.15 per
hundredweight of Colorado potatoes. Therefore, the estimated assessment
revenue for the 1998-99 fiscal period as a percentage of total grower
revenue will range between 0.0900 and 0.0243 percent.
This action continues to decrease the 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 Colorado Area II potato 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 21, 1998, meeting was a public meeting and all entities, both
large and small, were able to express views on this issue.
This action will not impose any additional reporting or
recordkeeping requirements on either small or large Colorado Area II
potato 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.
An interim final rule concerning this action was published in the
Federal Register on July 16, 1998 (63 FR 38282). Copies of that rule
were also mailed or sent via facsimile to all Area II potato handlers.
Finally, the interim final rule was made available through the Internet
by the Office of the Federal Register. A 60-day comment period was
provided for interested persons to respond to the interim final rule.
The comment period ended on September 14, 1998, and no comments were
received.
After consideration of all relevant matter 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.
List of Subjects in 7 CFR Part 948
Marketing agreements, Potatoes, Reporting and recordkeeping
requirements.
PART 948--IRISH POTATOES GROWN IN COLORADO
Accordingly, the interim final rule amending 7 CFR part 948 which
was published at 63 FR 38282 on July 16, 1998, is adopted as a final
rule without change.
Dated: October 5, 1998.
Robert C. Keeney,
Deputy Administrator, Fruit and Vegetable Programs.
[FR Doc. 98-27182 Filed 10-8-98; 8:45 am]
BILLING CODE 3410-02-P
