[Federal Register Volume 62, Number 53 (Wednesday, March 19, 1997)]
[Proposed Rules]
[Pages 12976-12979]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-6985]
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Proposed Rules
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains notices to the public of
the proposed issuance of rules and regulations. The purpose of these
notices is to give interested persons an opportunity to participate in
the rule making prior to the adoption of the final rules.
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Federal Register / Vol. 62, No. 53 / Wednesday, March 19, 1997 /
Proposed Rules
[[Page 12976]]
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 1208
[FV-97-701PR]
Fresh Cut Flowers and Fresh Cut Greens Promotion and Information
Order; Referendum Procedures
AGENCY: Agricultural Marketing Service, USDA
ACTION: Proposed rule with request for comments.
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SUMMARY: The purpose of this rule is to provide procedures that the
Department of Agriculture (Department) will use in conducting the
referendum to determine whether to continue the Fresh Cut Flowers and
Fresh Cut Greens Promotion and Information Order (Order). In order to
continue, the program must be approved by a majority of the qualified
handlers voting in the referendum.
DATES: Comments must be received by April 3, 1997.
ADDRESSES: Interested persons are invited to submit written comments
concerning this proposed rule to: Research and Promotion Branch, Fruit
and Vegetable Division, Agricultural Marketing Service (AMS), USDA,
P.O. Box 96456, Room 2535-S, Washington, DC 20090-6456, fax (202) 205-
2800. Three copies of all written material should be submitted, and
they will be made available for public inspection at the Research and
Promotion Branch during regular business hours. All comments should
reference the docket number and the date and page number of this issue
of the Federal Register. Also send comments regarding the accuracy of
the burden estimate, ways to minimize the burden, including through the
use of automated collection techniques or other forms of information
technology, or any other aspect of this collection of information, to
the above address.
FOR FURTHER INFORMATION CONTACT: Sonia N. Jimenez, Research and
Promotion Branch, Fruit and Vegetable Division, AMS, USDA, P.O. Box
96456, Room 2535-S, Washington, DC 20090-6456, telephone (202) 720-9916
or (888) 720-9917.
SUPPLEMENTARY INFORMATION: This proposed rule is issued under the
Fresh Cut Flowers and Fresh Cut Greens Promotion and Information
Act of 1993 (7 U.S.C. 6801-et seq.), hereinafter referred to as the
Act, and the Order.
This rule provides the procedures under which the referendum would
be conducted.
Executive Order 12988
This rule has been reviewed under Executive Order 12988, Civil
Justice Reform. It is not intended to have retroactive effect. 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 8 of the Act,
after an Order is implemented, a person subject to the Order may file a
petition with the Secretary stating that the Order or any provision of
the Order, or any obligation imposed in connection with the Order, is
not in accordance with law and requesting a modification of the Order
or an exemption from the Order. The petitioner is afforded the
opportunity for a hearing on the petition. After such hearing, the
Secretary will make a ruling on the petition. The Act provides that the
district courts of the United States in any district in which a person
who is a petitioner resides or carries on business are vested with
jurisdiction to review the Secretary's ruling on the petition, if a
complaint for that purpose is filed within 20 days after the date of
the entry of the ruling.
Executive Order 12866 and Regulatory Flexibility Act
This rule has been determined not significant for purposes of
Executive Order 12866, and therefore has not been reviewed by the
Office of Management and Budget.
In accordance with the Regulatory Flexibility Act (5 U.S.C. 601 et
seq.), the Agency is required to examine the impact of the proposed
rule on small entities. Accordingly, we have performed this initial
regulatory flexibility analysis.
The Act, which authorizes the creation of a generic program of
promotion and information for fresh cut flowers and greens, became
effective on December 14, 1993.
Section 7 of the Act provides that the Secretary of Agriculture
(Secretary) shall conduct a referendum not later than 3 years after the
issuance of an order to ascertain whether the order then in effect
shall be continued. The Order was issued on December 29, 1994.
Paragraph (a)(2) of section 7 of the Act requires that the Order be
approved by a simple majority of all votes cast in the referendum. In
addition, paragraph (b) of section 7 of the Act specifies that each
qualified handler eligible to vote in the referendum shall be entitled
to cast one vote for each separate facility of the person that is an
eligible separate facility. Eligible separate facility is defined in
paragraph (b)(2) of section 7 of the Act as a handling or marketing
facility of a qualified handler that is physically located away from
other facilities of the qualified handler or that the business function
of the separate facility is substantially different from the functions
of other facilities owned or operated by the qualified handler and the
annual sales of cut flowers and cut greens to retailers and exempt
handlers from the facility are $750,000 or more annually.
Only those wholesale handlers (including but not limited to,
wholesale jobbers, bouquet and floral article manufacturers, auction
houses that clear the sale of cut flowers and greens, and retail
distribution centers), producers and importers who have annual sales of
$750,000 or more of fresh cut flowers and greens and who sell those
products to exempt handlers, retailers, or consumers are considered
qualified handlers and assessed under the Order.
There are approximately 525 wholesale handlers, 84 importers, and
83 producers who are qualified handlers. Small agricultural service
firms, which would include the qualified handlers covered under the
Order, have been defined by the Small Business Administration (SBA) (13
CFR 121.601) as those whose annual receipts are less than $5 million.
Only 127 qualified handlers have been identified to have $5 million in
annual sales.
[[Page 12977]]
It is concluded that the majority of qualified handlers may be
classified as small entities.
Statistics reported by the National Agricultural Statistics Service
show that in 1995 sales of domestic cut flowers and cut greens totaled
approximately $521.3 million at the wholesale level. The leading
producing states by wholesale value are California, with about 49
percent of the total of flower and cut green production, followed by
Florida, Colorado and Hawaii.
Exports in 1995 of U.S. cut flowers were valued at $23.9 million,
with about 64 percent of the value from exports to Canada, and 26
percent of the value from exports to Japan. Exports of cut greens are
not reported by the Bureau of the Census as a separate item; they are
included in a ``basket'' export category that includes other types of
fresh cut plant exports such as branches without flowers or buds,
evergreens, and grasses, which are suitable for ornamental purposes. In
1995 the value of these exports was $45.6 million.
The value of imports of cut flowers in 1995 was $495.2 million.
Major countries exporting cut flowers to the United States, by value,
are Colombia which accounts for about 65 percent of the value, followed
by the Netherlands (11.6 percent), Ecuador (10.2 percent), and Mexico
(3.8 percent). Imports of cut greens are reported in a category that
includes some other fresh cut plant items suitable for ornamental
purposes such as grasses, branches without flowers or buds, and other
plant parts, but excludes fresh evergreens. In 1995 this ``basket
category'' of imports had a value of $24.1 million.
This proposed rule provides the procedures under which qualified
handlers may vote on whether they want the fresh cut flowers and fresh
cut greens promotion and information program to be continued. Qualified
handlers of $750,000 or more in annual gross sales are eligible to vote
in the referendum. There are approximately 692 eligible voters
representing approximately 923 votes some of which represent separate
facilities. It will take an average of 15 minutes for each voter to
read the voting instructions and complete the referendum ballot. The
total burden on the total number of voters will be 77 hours.
The Department would keep all these individuals informed throughout
the referendum process to ensure that they are aware of and are able to
participate in the process. In addition, trade associations and related
industry media would receive news releases and other information
regarding the referendum process.
Voting in the referendum is optional. However, if qualified
handlers choose to vote, the burden of voting would be offset by the
benefits of having the opportunity to vote on whether they want to
continue the program or not.
The Department considered requiring eligible voters to vote in
person at various Department offices across the country. However,
conducting the referendum from one central location by mail ballot is
more cost effective for this program. Also, the Department would
provide easy access to information for potential voters through a toll
free telephone line. It is anticipated that a referendum would be
conducted in June to maximize industry participation.
While we have performed this Initial Regulatory Flexibility
Analysis regarding the impact of this proposed rule on small entities,
in order to have all the data necessary for a more comprehensive
analysis of the effects of this rule on small entities, we are inviting
comments concerning potential effects. In particular, we are interested
in determining the number and kind of small entities that may incur
benefits or costs from implementation of this proposed rule and
information on the expected benefits or costs.
Paperwork Reduction Act
In accordance with the Office of Management and Budget (OMB)
regulations (5 CFR Part 1320) which implements the Paperwork Reduction
Act of 1995 (44 U.S.C. Chapter 35), the referendum ballot has been
approved by the Office of Management and Budget (OMB) and has been
assigned OMB number 0581-0093. It is estimated that there are 692
qualified handlers, representing 923 votes, who will be eligible to
vote in the referendum. It will take an average of 15 minutes for each
voter to read the voting instructions and complete the referendum
ballot. The total burden on the total number of voters will be 77
hours.
Background
The Act authorized the Secretary to establish a national cut
flowers and cut greens promotion and consumer information program. The
program is funded by an assessment of \1/2\ percent of gross sales of
cut flowers and greens which is levied on qualified handlers. The
program is administered by the National PromoFlor Council (Council)
under the supervision of the Department of Agriculture (Department).
Assessments are used to pay for: research, promotion, and consumer
information; administration, maintenance, and functioning of the Board;
and expenses incurred by the Secretary in implementing and
administering the Order, including referendum costs.
Section 7 of the Act requires that a referendum be conducted not
later than 3 years after the issuance of the Order among eligible
qualified handlers of fresh cut flowers and fresh cut greens to
determine whether they favor continuance of the Order. The Order shall
continue in effect if it is approved by a simple majority of qualified
handlers voting in the referendum.
In accordance with section 3(4) of the Act, qualified handler is
defined in the Order as a person operating in the cut flowers and
greens marketing system that sells domestic or imported cut flowers and
greens to retailers and exempt handlers and whose annual sales of cut
flowers and greens to retailers and exempt handlers are $750,000 or
more. The term also includes, but is not limited to, the following
entities when they have the requisite volume of $750,000 sales of cut
flowers and greens a year: A wholesale handler; a manufacturer of
bouquets or floral articles for sale to retailers if the cut flowers
and greens used are a substantial portion of the value of the
manufactured floral article; an auction house that clears the sale of
cut flowers and greens to retailers and exempt handlers through a
central clearinghouse; a distribution center that is owned or
controlled by a retailer if the predominant retail business activity is
floral sales; an importer whose principal activity is the importation
of cut flowers and greens into the United States and sells to retailers
and exempt handlers or directly to consumers; and a producer that sells
cut flowers and cut greens directly to retailers or consumers.
Paragraph (b) of section 7 of the Act specifies that each qualified
handler eligible to vote in the referendum shall be entitled to cast
one vote for each separate facility of the person that is an eligible
separate facility. Eligible separate facility is defined in paragraph
(b)(2) of section 7 of the Act as a handling or marketing facility of a
qualified handler that is physically located away from other facilities
of the qualified handler or that the business function of the separate
facility is substantially different from the functions of other
facilities owned or operated by the qualified handler and the annual
sales of cut flowers and cut greens to retailers and exempt handlers
from the facility are $750,000 or more annually.
This proposed rule provides the procedures under which fresh cut
flowers and greens qualified handlers may vote on whether they want the
[[Page 12978]]
fresh cut flowers and greens promotion and consumer information program
to continue. Qualified handlers of $750,000 gross sales annually can
vote in the referendum. There are approximately 692 eligible voters
representing approximately 923 votes.
This proposed rule would add a new subpart which would establish
procedures to be used in the referendum. This subpart would be in
effect for the referendum period only and would not be part of the Code
of Federal Regulations. This subpart covers definitions, voting,
instructions, use of subagents, ballots, the referendum report, and
confidentiality of information.
All written comments received in response to this rule by the date
specified herein will be considered prior to finalizing this action. We
encourage the industry to pay particular attention to the definitions
to be sure that they are appropriate for the fresh cut flowers and
greens industry.
A 15-day comment period is deemed appropriate for this rule
because: (1) These proposed regulations contain provisions that are the
same as or similar to referendum procedures for other research and
promotion programs; (2) the fresh cut flowers and greens industry is
aware that a referendum would be conducted this year; (3) comments
would be addressed before a final rule is published; and (4) this
rulemaking should be expedited in order to conduct a referendum in June
to maximize industry participation.
List of Subjects in 7 CFR Part 1208
Administrative practice and procedure, Advertising, Consumer
information, Marketing agreements, Cut flowers, Cut greens, Promotion,
Reporting and recordkeeping requirements.
For the reasons set forth in the preamble, it is proposed that
Title 7 of Chapter XI of the Code of Federal Regulations be amended as
follows:
1. Part 1208 is amended by adding a new Subpart C to read as
follows:
PART 1208--FRESH CUT FLOWERS AND FRESH CUT GREENS PROMOTION AND
INFORMATION ORDER
Subpart C--Procedure for the Conduct of Referenda in Connection With
the Fresh Cut Flowers and Fresh Cut Greens Promotion and Information
Order
Sec.
1208.200 General.
1208.201 Definitions.
1208.202 Voting.
1208.203 Instructions.
1208.204 Subagents.
1208.205 Ballots.
1208.206 Referendum report.
1208.207 Confidential information.
Authority: 7 U.S.C. 6801 et seq.
Subpart C--Procedure for the Conduct of Referenda in Connection
With the Fresh Cut Flowers and Fresh Cut Greens Promotion and
Information Order
Sec. 1208.200 General.
A referendum to determine whether qualified handlers favor
continuance of the Fresh Cut Flowers and Fresh Cut Greens Promotion and
Information Order shall be conducted in accordance with these
procedures.
Sec. 1208.201 Definitions.
Unless otherwise defined below, the definition of terms used in
these procedures shall have the same meaning as the definitions in the
Order.
(a) Administrator means the Administrator of the Agricultural
Marketing Service, with power to redelegate, or any officer or employee
of the Department to whom authority has been delegated or may hereafter
be delegated to act in the Administrator's stead.
(b) Order means the Fresh Cut Flowers and Fresh Cut Greens
Promotion and Information Order.
(c) Referendum agent or agent means the individual or individuals
designated by the Secretary to conduct the referendum.
(d) Representative period means the period designated by the
Secretary.
(e) Person means any individual, group of individuals, firm,
partnership, corporation, joint stock company, association, society,
cooperative, or any other legal entity. For the purpose of this
definition, the term ``partnership'' includes, but is not limited to:
(1) A husband and wife who has title to, or leasehold interest in,
fresh cut flowers and greens facilities and equipment as tenants in
common, joint tenants, tenants by the entirety, or, under community
property laws, as community property, and
(2) So-called ``joint ventures'', wherein one or more parties to
the agreement, informal or otherwise, contributed capital and others
contributed labor, management, equipment, or other services, or any
variation of such contributions by two or more parties so that it
results in the handling of fresh cut flowers and greens and the
authority to transfer title to the fresh cut flowers and greens
handled.
(f) Eligible qualified handler means a person who is a qualified
handler under Sec. 1208.16 of the Order that operates in the cut
flowers and greens marketing system and sells domestic or imported cut
flowers and greens to retailers and exempt handlers and has annual
sales of cut flowers and greens to retailers and exempt handlers that
are $750,000 or more.
(g) Separate facility means a handling or marketing facility of a
qualified handler that is physically located away from other facilities
of the qualified handler or that the business function of the separate
facility is substantially different from the functions of other
facilities owned or operated by the qualified handler and the annual
sales of cut flowers and cut greens to retailers and exempt handlers
from the facility are $750,000 or more annually.
Sec. 1214.202 Voting.
(a) Each person who is an eligible qualified handler as defined in
this subpart, at the time of the referendum and during the
representative period, shall be entitled to cast one vote for each
separate facility of the person that is an eligible separate facility.
(b) Proxy voting is not authorized, but an officer or employee of
an eligible qualified handler, or an administrator, executor, or
trustee of an eligible qualified handler entity may cast a ballot on
behalf of such qualified handler entity. Any individual so voting in a
referendum shall certify that such individual is an officer or employee
of the eligible qualified handler, or an administrator, executor, or
trustee of an eligible qualified handler entity, and that such
individual has the authority to take such action. Upon request of the
referendum agent, the individual shall submit adequate evidence of such
authority.
(c) All ballots are to be cast by mail.
Sec. 1214.203 Instructions.
The referendum agent shall conduct the referendum, in the manner
herein provided, under the supervision of the Administrator. The
Administrator may prescribe additional instructions, not inconsistent
with the provisions hereof, to govern the procedure to be followed by
the referendum agent. Such agent shall:
(a) Determine the time of commencement and termination of the
period during which ballots may be cast.
(b) Provide ballots and related material to be used in the
referendum. Ballot material shall provide for recording essential
information including that needed for ascertaining whether the person
voting, or on whose
[[Page 12979]]
behalf the vote is cast, is an eligible voter;
(c) Give reasonable advance public notice of the referendum:
(1) By utilizing available media or public information sources,
without incurring advertising expense, to publicize the dates, places,
method of voting, eligibility requirements, and other pertinent
information. Such sources of publicity may include, but are not limited
to, print and radio; and
(2) By such other means as the agent may deem advisable.
(d) Mail to eligible qualified handlers, whose names and addresses
are known to the referendum agent, the instructions on voting, a
ballot, and a summary of the terms and conditions of the Order. No
person who claims to be eligible to vote shall be refused a ballot.
(e) At the end of the voting period, collect, open, number, and
review the ballots and tabulate the results in presence of an agent of
the Office of Inspector General.
(f) Prepare a report on the referendum.
(g) Announce the results to the public.
Sec. 1208.204 Subagents.
The referendum agent may appoint any individual or individuals
deemed necessary or desirable to assist the agent in performing such
agent's functions hereunder. Each individual so appointed may be
authorized by the agent to perform any or all of the functions which,
in the absence of such appointment, shall be performed by the agent.
Sec. 1208.205 Ballots.
The referendum agent and subagents shall accept all ballots cast;
but, should they, or any of them, deem that a ballot should be
questioned for any reason, the agent or subagent shall endorse above
their signature, on the ballot, a statement to the effect that such
ballot was questioned, by whom questioned, the reasons therefore, the
results of any investigations made with respect thereto, and the
disposition thereof. Ballots invalid under this subpart shall not be
counted.
Sec. 1208.206 Referendum report.
Except as otherwise directed, the referendum agent shall prepare
and submit to the Administrator a report on results of the referendum,
the manner in which it was conducted, the extent and kind of public
notice given, and other information pertinent to analysis of the
referendum and its results.
Sec. 1208.207 Confidential information.
The ballots and other information or reports that reveal, or tend
to reveal, the vote of any person covered under the Act and the voting
list shall be held confidential and shall not be disclosed.
Dated: March 14, 1997.
Robert C. Keeney,
Director, Fruit and Vegetable Division.
[FR Doc. 97-6985 Filed 3-17-97; 9:49 am]
BILLING CODE 3410-02-P
