99-12238. Avocados Grown in South Florida; Increased Assessment Rate  

  • [Federal Register Volume 64, Number 93 (Friday, May 14, 1999)]
    [Rules and Regulations]
    [Pages 26271-26273]
    From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
    [FR Doc No: 99-12238]
    
    
    
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    Federal Register / Vol. 64, No. 93 / Friday, May 14, 1999 / Rules and 
    Regulations
    
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    DEPARTMENT OF AGRICULTURE
    
    Agricultural Marketing Service
    
    7 CFR Part 915
    
    [Docket No. FV99-915-1 FR]
    
    
    Avocados Grown in South Florida; Increased Assessment Rate
    
    AGENCY: Agricultural Marketing Service, USDA.
    
    ACTION: Final rule.
    
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    SUMMARY: This rule increases the assessment rate from $0.08 to $0.16 
    per 55-pound bushel container or equivalent of avocados established for 
    the Avocado Administrative Committee (Committee) under Marketing Order 
    No. 915 for the 1999-2000 and subsequent fiscal years. The Committee is 
    responsible for local administration of the marketing order which 
    regulates the handling of avocados grown in South Florida. 
    Authorization to assess avocado handlers enables the Committee to incur 
    expenses that are reasonable and necessary to administer the program. 
    The fiscal year began on April 1 and ends March 31. The assessment rate 
    will remain in effect indefinitely unless modified, suspended, or 
    terminated.
    
    EFFECTIVE DATE: May 17, 1999.
    
    FOR FURTHER INFORMATION CONTACT: Doris Jamieson, Southeast Marketing 
    Field Office, Fruit and Vegetable Programs, AMS, USDA, P.O. Box 2276; 
    Winter Haven, FL 33883-2276; telephone: (941) 299-4770, Fax: (941) 299-
    5169; or George Kelhart, Technical Advisor, 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) 720-5698. Small businesses may request information 
    on complying with this regulation, or obtain a guide on complying with 
    fruit, vegetable, and specialty crop marketing agreements and orders by 
    contacting Jay Guerber, Marketing Order Administration Branch, Fruit 
    and Vegetable Programs, AMS, USDA, P.O. Box 96456, room 2525-S, 
    Washington, DC 20090-6456; telephone (202) 720-2491, Fax: (202) 720-
    5698, or E-mail: Jay.Guerber@usda.gov. You may view the marketing 
    agreement and order small business compliance guide at the following 
    web site: http://www.ams.usda.gov/fv/moab.html.
    
    SUPPLEMENTARY INFORMATION: This rule is issued under Marketing 
    Agreement No. 121 and Order No. 915, both as amended (7 CFR part 915), 
    regulating the handling of avocados grown in South Florida, 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 of Agriculture (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, 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 issued herein will be applicable to all assessable 
    avocados beginning April 1, 1999, 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 increases the assessment rate established for the 
    Committee for the 1999-2000 and subsequent fiscal years from $0.08 per 
    55-pound bushel container or equivalent to $0.16 per 55-pound container 
    or equivalent of South Florida avocados handled.
        The Florida avocado 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 
    South Florida avocados. 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.
        For the 1998-1999 and subsequent fiscal years, the Committee 
    recommended, and the Department approved, an assessment rate that would 
    continue in effect from fiscal year to fiscal year 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 January 13, 1999, and unanimously recommended 
    1999-2000 expenditures of $167,335 and an assessment rate of $0.16 per 
    55-pound bushel container or equivalent of avocados handled. In 
    comparison, last year's budgeted expenditures were $174,344. The 
    assessment rate of $0.16 is $0.08 higher than the previous rate. For 
    the 1998-99 fiscal period, the Committee voted to lower its assessment 
    rate from $0.16 to $0.08 to reduce the funds in its operating reserve. 
    It wanted to bring its reserve closer to one year's operating expenses. 
    With this accomplished, the Committee voted to return the assessment 
    rate to the previous level of $0.16 to cover 1999-2000 expenses. As 
    discussed later, the Committee expects to use interest income and 
    reserve funds to cover some of its anticipated expenses during 1999-
    2000 because the $0.16 per 55-pound bushel container or equivalent
    
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    assessment rate is expected to generate $144,000, which is $23,335 less 
    than the Committee's budgeted expenses.
        The major expenditures recommended by the Committee for the 1999-
    2000 year include $46,000 for salaries, $39,500 for production 
    research, $27,000 for local and national enforcement, $10,040 for 
    employee benefits, $8,955 for insurance and bonds, and $5,500 for 
    travel. Budgeted expenses for these items in 1998-99 were $46,000, 
    $41,500, $32,000, $9,778, $8,516, and $7,000 respectively.
        The assessment rate recommended by the Committee was derived by 
    dividing anticipated expenses by expected shipments of Florida 
    avocados. Avocado shipments for the year are estimated at 900,000 55-
    pound bushel containers which should provide $144,000 in assessment 
    income. Income derived from handler assessments, along with interest 
    income and funds from the Committee's authorized reserve, should be 
    adequate to cover budgeted expenses. Funds in the reserve (currently 
    $187,615) will be kept within the maximum of 3 fiscal years' 
    operational expenses permitted by the order (Secs. 915.42 and 915.142).
        The assessment rate established by 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 will be 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 the 
    Department. Committee meetings are 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 
    1999-2000 budget and those for subsequent fiscal years would 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 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 149 producers of avocados in the production 
    area and approximately 48 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 average price for fresh avocados during the 1996-97 season was 
    $13.20 per 55-pound bushel box equivalent for all domestic shipments 
    and the total shipments were 917,861 bushels. Approximately 10 percent 
    of all handlers handled 90 percent of the South Florida avocado 
    shipments during that season. Many handlers ship other tropical fruit 
    and vegetable products which are not included in the Committee data but 
    would contribute further to handler receipts. Using the average price 
    per 55-pound container or equivalent, about 90 percent of the avocado 
    handlers could be considered small businesses under SBA's definition 
    and about 10 percent of the handlers could be considered large 
    businesses. The majority of handlers and producers of Florida avocados 
    may be classified as small entities.
        This rule increases the assessment rate established for the 
    Committee and collected from handlers for the 1999-2000 and subsequent 
    fiscal years from $0.08 per 55-pound bushel container or equivalent to 
    $0.16 per 55-pound bushel container or equivalent of avocados. The 
    Committee unanimously recommended 1999-2000 expenditures of $167,335 
    and an assessment rate of $0.16 per 55-pound bushel container or 
    equivalent handled. The assessment rate of $0.16 is $0.08 higher than 
    the 1998-99 rate. The quantity of assessable avocados for the 1999-2000 
    season is estimated at 900,000 containers. Thus, the $0.16 rate should 
    provide $144,000 in assessment income. Assessment income, along with 
    interest income and funds from the Committee's authorized reserve, 
    should be adequate to cover budgeted expenses.
        The major expenditures recommended by the Committee for the 1999-
    2000 year include $46,000 for salaries, $39,500 for production 
    research, $27,000 for local and national enforcement, $10,040 for 
    employee benefits, $8,955 for insurance and bonds, and $5,500 for 
    travel. Budgeted expenses for these items in 1998-99 were $46,000, 
    $41,500, $32,000, $9,778, $8,516, and $7,000, respectively.
        During the 1998-99 season, the Committee voted to decrease the 
    assessment rate to bring its operating reserve closer to one year's 
    operating expenses. For the 1999-2000 fiscal period, the Committee 
    voted to return to the previous rate of $0.16 to cover authorized 
    expenses. The Committee expects to use interest income and funds from 
    its operating reserve to cover 1999-2000 expenses. This will be 
    necessary because assessment income is expected to total $144,000, and 
    the Committee's budget totals $167,335.
        The Committee's 1999-2000 budgeted expenditures of $167,335 include 
    increases in employee benefits and office equipment. Prior to arriving 
    at this budget, the Committee considered information from various 
    sources, such as the Committee's Budget Subcommittee. Alternative 
    expenditure levels were discussed, based upon the relative value of 
    various research projects to the South Florida avocado industry.
        The assessment rate of $0.16 per 55-pound bushel container or 
    equivalent of assessable avocados was then determined by dividing the 
    total recommended budget by the quantity of assessable avocados, 
    estimated at 900,000 55-pound bushel containers or equivalents for the 
    1999-2000 fiscal period. This rate is expected to provide $144,000 in 
    assessment income, which is $23,335 below budgeted expenses. The 
    Committee found this acceptable because interest income and funds from 
    the Committee's operating reserve would be available to make up the 
    deficit.
        A review of historical information indicates that the grower price 
    for 1999-2000 season could range between $13.20 and $14.90 per 55-pound 
    bushel container or equivalent of avocados. Therefore, the estimated 
    assessment revenue for the 1999-2000 fiscal year as a percentage of 
    total grower revenue could range between 1 and 1.2 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 marketing 
    order. In
    
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    addition, 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 January 13, 1999, meeting was 
    a public meeting and all entities, both large and small, were able to 
    express views on this issue.
        This rule imposes no 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.
        The Department 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 March 17, 1999 (64 FR 13123). Copies of the proposed rule 
    were also mailed or sent via facsimile to all avocado handlers. 
    Finally, the proposal was made available through the Internet by the 
    Office of the Federal Register. A 30-day comment period ending April 
    16, 1999, was provided for interested persons to respond to the 
    proposal. No comments in opposition were received.
        After consideration of all relevant material presented, including 
    the information and recommendation submitted by the Committee, the 
    comment received, 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 the 1999-2000 
    fiscal year began on April 1, 1999, and the marketing order requires 
    that the rate of assessment for each fiscal year apply to all 
    assessable avocados handled during such period. The Committee needs to 
    have sufficient funds to pay its expenses which are incurred on a 
    continuous basis. Further, handlers are aware of this rule which was 
    recommended at a public meeting. Also, a 30-day comment period was 
    provided for in the proposed rule.
    
    List of Subjects in 7 CFR Part 915
    
        Avocados, Marketing agreements, Reporting and recordkeeping 
    requirements.
    
        For the reasons set forth in the preamble, 7 CFR part 915 is 
    amended as follows:
    
    PART 915--AVOCADOS GROWN IN SOUTH FLORIDA
    
        1. The authority citation for 7 CFR part 915 continues to read as 
    follows:
    
        Authority: 7 U.S.C. 601-674.
    
        2. Section 915.235 is revised to read as follows:
    
    
    Sec. 915.235  Assessment rate.
    
        On and after April 1, 1999, an assessment rate of $0.16 per 55 
    pound bushel container or equivalent is established for avocados grown 
    in South Florida.
    
        Dated: May 10, 1999.
    Robert C. Keeney,
    Deputy Administrator, Fruit and Vegetable Programs.
    [FR Doc. 99-12238 Filed 5-13-99; 8:45 am]
    BILLING CODE 3410-02-P
    
    
    

Document Information

Effective Date:
5/17/1999
Published:
05/14/1999
Department:
Agricultural Marketing Service
Entry Type:
Rule
Action:
Final rule.
Document Number:
99-12238
Dates:
May 17, 1999.
Pages:
26271-26273 (3 pages)
Docket Numbers:
Docket No. FV99-915-1 FR
PDF File:
99-12238.pdf
CFR: (1)
7 CFR 915.235