[Federal Register Volume 63, Number 89 (Friday, May 8, 1998)]
[Rules and Regulations]
[Pages 25387-25389]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-12291]
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Rules and Regulations
Federal Register
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Federal Register / Vol. 63, No. 89 / Friday, May 8, 1998 / Rules and
Regulations
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DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 979
[Docket No. FV98-979-1 FIR]
Melons Grown in South Texas; 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 established for the South Texas
Melon Committee (Committee) under Marketing Order No. 979 for the 1997-
98 and subsequent fiscal periods. The Committee is responsible for
local administration of the marketing order which regulates the
handling of melons grown in South Texas. Authorization to assess Texas
melon handlers enables the Committee to incur expenses that are
reasonable and necessary to administer the program. The fiscal period
began on October 1 and ends September 30. The assessment rate will
remain in effect indefinitely unless modified, suspended, or
terminated.
EFFECTIVE DATE: June 8, 1998.
FOR FURTHER INFORMATION CONTACT: Cynthia Cavazos or Belinda G. Garza,
McAllen Marketing Field Office, Fruit and Vegetable Programs, AMS,
USDA, 1313 East Hackberry, McAllen, Texas 78501; telephone: (956) 682-
2833, Fax: (956) 682-5942; 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) 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, PO Box 96456, Washington, DC 20090-
6456; telephone: (202) 720-2491, Fax: (202) 205-6632.
SUPPLEMENTARY INFORMATION: This rule is issued under Marketing
Agreement No. 156 and Order No. 979 (7 CFR part 979), regulating the
handling of melons grown in South Texas, 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, South Texas
melon 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
melons beginning October 1, 1997, 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 1997-98 and subsequent fiscal periods from $0.07
per carton to $0.04 per carton.
The Texas melon 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 Texas melons. They are familiar with the Committee's needs and
with the costs of 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 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, in a telephone vote, unanimously recommended 1997-98
administrative expenses of $100,000 for personnel, office, and the
travel portion of the compliance budget. These expenses were approved
in September 1997. The assessment rate and funding for research
projects, promotion, and the road guard station maintenance portion of
the compliance budget were to be recommended at a later Committee
meeting.
The Committee subsequently met on December 16, 1997, and
unanimously recommended 1997-98 expenditures of $158,200 and an
assessment rate of $0.04 per carton of melons. In comparison, last
year's budgeted expenditures were $308,000. The assessment rate of
$0.04 is $0.03 lower than the rate previously in effect. At the former
rate of $0.07 per carton, the assessment income would have exceeded
anticipated expenses by about $112,700, and the projected reserve of
$234,269 on September 30, 1998, would have exceeded the level the
Committee believes to be adequate to administer the program. The
Committee voted to lower its assessment rate and use more of the
reserve to cover its expenses. The
[[Page 25388]]
reduced assessment rate is expected to bring assessment income closer
to the amount necessary to administer the program for the 1997-98
fiscal period.
Major expenses recommended by the Committee for the 1997-98 fiscal
year include $84,500 for personnel and administrative expenses, $40,500
for compliance, $23,200 for research projects, and $10,000 for
promotion. Budgeted expenses for these items in 1996-97 were $84,500,
$115,500, $108,000, and $0, respectively.
The assessment rate recommended by the Committee was derived by
dividing anticipated expenses by expected shipments of South Texas
melons. Melon shipments for the year are estimated at 3,870,000
cartons, which should provide $154,800 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 (currently $228,669) will be kept within the maximum
permitted by the order (approximately two fiscal periods' expenses;
Sec. 979.44).
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 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 remainder of
the Committee's 1997-98 budget was approved December 23, 1997, 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 33 producers of South Texas melons in the
production area and approximately 16 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 South Texas melon producers and handlers
may be classified as small entities.
This rule continues in effect the assessment rate of $0.04 per
carton established for the Committee and collected from handlers for
the 1997-98 and subsequent fiscal periods. The Committee unanimously
recommended 1997-98 expenditures of $158,200 and an assessment rate of
$0.04 per carton of melons. In comparison, last year's budgeted
expenditures were $308,000. The assessment rate of $0.04 is $0.03 less
than the rate previously in effect. At the former rate of $0.07 per
carton and an estimated 1998 melon production of 3,870,000 cartons, the
projected reserve on September 30, 1998, would have exceeded the level
the Committee believes necessary to administer the program. The
Committee decided that an assessment rate of less than $0.04 would not
generate the income necessary to administer the program with an
adequate reserve.
Major expenses recommended by the Committee for the 1997-98 fiscal
period include $84,500 for personnel and administrative expenses,
$40,500 for compliance, $23,200 for research projects, and $10,000 for
promotion. Budgeted expenses for these items in 1996-97 were $84,500,
$115,500, $108,000, and $0, respectively.
Melon shipments for the year are estimated at 3,870,000 cartons,
which should provide $154,800 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 (currently $228,669) will be kept within the maximum permitted
by the order (approximately two fiscal periods' expenses; Sec. 979.44).
Recent price information indicates that the grower price for the
1997-98 marketing season will range between $7.00 and $9.00 per carton
of cantaloupes and between $5.00 and $7.00 per carton of honeydew
melons. Therefore, the estimated assessment revenue for the 1997-98
fiscal period as a percentage of total grower revenue will range
between .006 and .004 percent for cantaloupes and between .008 and .006
percent for honeydew melons.
This rule continues to decrease the assessment obligation imposed
on handlers. While this rule imposes 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 addition, the Committee's meeting was widely publicized
throughout the South Texas melon industry and all interested persons
were invited to attend the meeting and participate in Committee
deliberations on all issues. Like all Committee meetings, the December
16, 1997, 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 South Texas melon 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 January 29, 1998 (63 FR 4366). 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 March 30, 1998, and no comments were received.
After consideration of all relevant material 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.
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List of Subjects in 7 CFR Part 979
Marketing agreements, Melons, Reporting and recordkeeping
requirements.
For the reasons set forth in the preamble, 7 CFR part 979 is
amended as follows:
PART 979--MELONS GROWN IN SOUTH TEXAS
Accordingly, the interim final rule amending 7 CFR part 979 which
was published at 63 FR 4366 on January 29, 1998, is adopted as a final
rule without change.
Dated: May 4, 1998.
Robert C. Keeney,
Deputy Administrator, Fruit and Vegetable Programs.
[FR Doc. 98-12291 Filed 5-7-98; 8:45 am]
BILLING CODE 3410-02-P
