Irish Potatoes Grown in Washington; Order Amending Marketing Order No. 946, 41129-41134 [05-14004]

Agencies

• Agricultural Marketing Service
• DEPARTMENT OF AGRICULTURE

[Federal Register Volume 70, Number 136 (Monday, July 18, 2005)]
[Rules and Regulations]
[Pages 41129-41134]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 05-14004]



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Federal Register / Vol. 70, No. 136 / Monday, July 18, 2005 / Rules 
and Regulations

[[Page 41129]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 946

[Docket No. AO-F&V-946-3; FV03-946-01 FR]


Irish Potatoes Grown in Washington; Order Amending Marketing 
Order No. 946

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: This rule amends the marketing order (order) for Irish 
potatoes grown in Washington. Irish potato growers, voting in a mail 
referendum held March 18 through April 8, 2005 voted on seven 
amendments proposed by the State of Washington Potato Committee 
(Committee), which is responsible for local administration of the 
order, and two amendments proposed by the Agricultural Marketing 
Service of USDA. Of the nine amendments proposed, seven were favored, 
including: Adding authority for container and marking regulations; 
requiring Committee producer members to have produced potatoes for the 
fresh market in at least 3 out of the last 5 years prior to nomination; 
updating order provisions pertaining to establishment of districts and 
apportionment of Committee membership among those districts; allowing 
for nominations to be held at industry meetings or events; adding 
authority to change the size of the Committee; adding authority to 
allow temporary alternates to serve when a Committee member and that 
member's alternate are unable to serve; and, requiring continuance 
referenda to be conducted every six years. The two amendments that 
failed include: requiring Committee nominees to submit a written 
background and acceptance statement prior to selection by USDA and 
establishing tenure limitations for Committee members.

DATES: This rule is effective July 19, 2005.

FOR FURTHER INFORMATION CONTACT: Melissa Schmaedick, Marketing Order 
Administration Branch, Fruit and Vegetable Programs, Agricultural 
Marketing Service, USDA, Post Office Box 1035, Moab, UT 84532, 
telephone: (435) 259-7988, fax: (435) 259-4945; or Teresa Hutchinson, 
Marketing Order Administration Branch, Fruit and Vegetable Programs, 
AMS, USDA, Northwest Marketing Field Office, 1220 SW. Third Avenue, 
room 385, Portland, OR 97204; telephone (503) 326-2724 or Fax (503) 
326-7440.
    Small businesses may request information on this proceeding 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@usda.gov.

SUPPLEMENTARY INFORMATION: Prior documents in this proceeding: Notice 
of Hearing issued on October 6, 2003, and published in the October 10, 
2003, issue of the Federal Register (68 FR 58638); Recommended Decision 
issued on November 19, 2004 and published in the November 26, 2004 
issue of the Federal Register (69 FR 68819); and a Secretary's Decision 
and Referendum Order issued February 8, 2005, and published in the 
Federal Register on February 14, 2005 (70 FR 7437).
    This administrative action is governed by the provisions of 
sections 556 and 557 of title 5 of the United States Code and is 
therefore excluded from the requirements of Executive Order 12866.

Preliminary Statement

    This final rule was formulated on the record of a public hearing 
held November 20, 2003, in Moses Lake, Washington. Notice of the 
hearing was issued October 6, 2003 and published in the October 10, 
2003 issue of the Federal Register (68 FR 58638). The hearing was held 
to consider the proposed amendment of Marketing Order No. 946, 
regulating the handling of Irish potatoes grown in the State of 
Washington, hereinafter referred to as the ``order.'' The hearing was 
held pursuant to the provisions of the Agricultural Marketing Agreement 
Act of 1937, as amended (7 U.S.C. 601 et seq.), hereinafter referred to 
as the ``Act,'' and the applicable rules of practice and procedure 
governing the formulation of marketing agreements and marketing orders 
(7 CFR part 900). The Notice of Hearing contained seven proposals 
submitted by the Committee and two proposals by the Agricultural 
Marketing Committee (AMS).
    Upon the basis of evidence introduced at the hearing and the record 
thereof, the Administrator of AMS on November 19, 2004, filed with the 
Hearing Clerk, U.S. Department of Agriculture, a Recommended Decision 
and Opportunity to File Written Exceptions thereto by December 27, 
2004. That document also announced AMS's intent to request approval of 
new information collection requirements to implement the program. 
Written comments on the proposed information collection requirements 
were also due by November 4, 2004. No comments or exceptions were filed 
to either the Recommended Decision or the information collection 
requirements.
    A Secretary's Decision and Referendum Order was issued on February 
8, 2005 directing that a referendum be conducted during the period 
March 18 through April 8, 2005, among growers of Irish potatoes to 
determine whether they favored the proposed amendments to the order. 
The voters voting in the referendum favored six of the amendments 
proposed by the Committee and one of the amendments proposed by USDA.
    The amendments favored by voters and included in this order will:
    1. Add authority for the Committee to recommend container and 
marking regulations. Regulations could include specification of the 
size, capacity, weight, dimensions, pack, and marking or labeling of 
containers used in the packaging or handling of Irish potatoes grown in 
Washington. This amendment will also add two new definitions to the 
order: ``Pack'' and ``container.''
    2. Require Committee producer members to have produced potatoes for 
the fresh market in at least 3 out of the last 5 years prior to 
nomination.
    3. Update order provisions pertaining to establishment of districts 
and apportionment of Committee membership among those districts. This

[[Page 41130]]

amendment will incorporate language currently in the order's 
administrative rules and regulations into the language of the order.
    4. Allow for nominations to be held at industry meetings or events 
in addition to or in place of meetings held in each of the five 
districts.
    5. Add authority for the Committee to recommend changes in the size 
of the administrative committee. In recommending any such changes, the 
following will be considered: (1) Shifts in acreage within districts 
and within the production area during recent years; (2) the importance 
of new production in its relation to existing districts; (3) equitable 
relationship between Committee apportionment and the various districts; 
and (4) other relevant factors.
    6. Add authority to allow temporary alternates to serve when a 
Committee member and that member's alternate are unable to serve. Any 
designee must be a current Committee member alternate of the same 
classification (handler or producer) to serve in the absent Committee 
member's stead.
    7. Require continuance referenda to be conducted every six years.
    To become effective, the amendments had to be approved by at least 
two-thirds of those producers voting or by voters representing at least 
two-thirds of the volume of Irish potatoes represented by voters voting 
in the referendum.
    AMS also proposed to allow such changes as may be necessary to the 
order so that all of the order's provisions conform to the effectuated 
amendments. None were deemed necessary.
    The amended marketing agreement was subsequently mailed to all 
Irish potato handlers in the production area for their approval. The 
marketing agreement was not approved by handlers representing at least 
50 percent of the volume of Irish potatoes handled by all handlers 
during the representative period of July 1, 2003, through June 30, 
2004.

Small Business Considerations

    Pursuant to the requirements set forth in the Regulatory 
Flexibility Act (RFA), AMS has considered the economic impact of this 
action on small entities. Accordingly, AMS has prepared this initial 
regulatory flexibility analysis.
    The purpose of the RFA is to fit regulatory actions to the scale of 
business subject to such actions so that small businesses will not be 
unduly or disproportionately burdened. Marketing orders and amendments 
thereto are unique in that they are normally brought about through 
group action of essentially small entities for their own benefit. Thus, 
both the RFA and the Act are compatible with respect to small entities.
    Small agricultural producers have been defined by the Small 
Business Administration (SBA) (13 CFR 121.201) as those having annual 
receipts of less than $750,000. Small agricultural service firms, which 
include handlers regulated under the order, are defined as those with 
annual receipts of less than $6,000,000.
    Interested persons were invited to present evidence at the hearing 
on the probable regulatory and informational impact of the proposed 
amendments to the order on small businesses. The record evidence is 
that while minimal costs may occur upon implementation of some of the 
proposed amendments, those costs would be outweighed by the benefits 
expected to accrue to the Washington fresh potato industry.
    The record indicates that there are about 39 fresh potato handlers 
currently regulated under the order. With total fresh sales valued at 
$108 million, on average, these handlers each received $2.8 million. In 
addition, there are about 160 producers of fresh potatoes in the 
production area. With total fresh sales at the producer level valued at 
$58 million, each grower's average receipts would be $362,500. 
Witnesses testified that about 76 percent of these producers are small 
businesses.
    It is reasonable to conclude that a majority of the fresh 
Washington potato handlers and producers are small businesses.

Potato Industry Overview

    Record evidence supplied by the Washington State Potato Commission 
indicates that there are approximately 323 potato producers in the 
State, of which approximately 160 (50 percent) are producers of fresh 
market potatoes. Approximately 76 percent of the fresh market potato 
producers are small entities, according to the SBA definition. Many of 
these farming operations also produce potatoes for the processing 
market. The Washington State potato industry also includes 39 handlers 
and 12 processing plants.
    A 2001 publication of Washington State University (WSU) Extension 
estimated that total demand for potatoes produced in Washington State 
was $495 million dollars. Of this total sales value figure for 
Washington potato producers, fresh market potato pack-out represented 
approximately 12 percent, with producer sales valued at $58 million. 
The largest proportion of the crop ($357 million or 72 percent) was 
represented by sales to the frozen potato product market, principally 
for French fries. Other uses included seed potatoes, dehydration and 
potato chips.
    The WSU report also explained that the supply of fresh market 
potatoes is handled by various potato packers (handlers) whose 
operations vary in size. These handlers supply the retail market, 
including supermarkets and grocery stores, as well as restaurants and 
other foodservice operations. Potatoes are prepared for the fresh 
market by cleaning, sorting, grading, and packaging before shipment is 
made to final destinations. Due to customer specifications about sizes, 
shapes, and blemishes, as well as the minimum quality, size, and 
maturity regulations of the order, about 42-43 percent of the potatoes 
delivered to handlers are graded out of the fresh market. Potatoes not 
meeting grade are generally delivered to processors for use in the 
frozen French fry and dehydrated potato markets. The total output of 
the fresh pack industry in terms of sales value is $108 million.
    Washington State acreage and production is second only to that of 
Idaho, but its yields per acre are the highest of any State in the 
United States. Produced on 165,000 acres, total potato production in 
Washington in 2002 was 92.4 million hundredweight, with an average 
yield of 560 hundredweight per acre. Over the last several years, 
Washington has produced about 21 percent of the total U.S. potato 
production on about 13 percent of the total acreage dedicated to 
potatoes. Washington's share of the total value has been about 17 
percent of the nation's total. Fresh utilization has varied between 11 
percent and 15 percent from 1993 through 2002. These figures are based 
on data published by the USDA's National Agricultural Statistical 
Service (NASS).
    The record indicates that soil type, climate, and number of 
irrigated acres combine to make Washington an excellent area to grow 
potatoes. In 2000, Washington produced a record crop with 105 million 
hundredweight grown on 175,000 acres with a total industry value of 
$555.2 million. This represents a substantial increase from 1949--the 
year in which the marketing order was established--in which producers 
harvested 29,000 acres with a yield of 6.4 million hundredweight of 
potatoes valued at $14.8 million. According to testimony, the producer 
price per hundredweight of potatoes was $2.30 in 1949 and $5.40 in 
2002.
    Witnesses at the hearing explained that potato production is 
dependent on many factors over which they have little control, 
including water availability, weather, and pest and weed pressures.

[[Page 41131]]

For example, the potato crop may be of higher average quality one year, 
yielding an increased supply of U.S. No. 1 grade potatoes, and have an 
overall lower quality the next year with a preponderance of U.S. No. 2 
grade potatoes.
    According to testimony, U.S. No. 2 grade potatoes in Washington are 
generally diverted for use in making dehydrated potato products. In 
addition, U.S. No. 2 grade potatoes are occasionally in demand as 
``peelers'' for use in soups and salads, or as ``natural'' fries. 
Regardless of the secondary products markets, witnesses explained, the 
fresh, table stock market is an important additional market for U.S. 
No. 2 grade potatoes. Witnesses explained that the Washington potato 
industry cannot currently take advantage of this market without 
container marking authority. Having the additional flexibility to pack 
U.S. No. 2 grade potatoes in labeled cartons will help the industry 
overall.
    This final rule amends Sec.  946.52, Issuance of regulations, to 
add authority for the Committee to recommend container and marking 
regulations to the USDA for subsequent implementation. This will be in 
addition to the existing authority for grade, size, quality and 
maturity requirements. Two new definitions, Sec.  946.17, Pack, and 
Sec.  946.18, Container, will be added to the order.
    In testifying in support of this amendment, witnesses cited an 
example of how this authority could be used. They stated that the 
Committee wants to respond to customer demand for U.S. No. 2 grade 
potatoes packed in cartons, but at the same time it wants to ensure 
that such cartons will be properly labeled. Three people testified in 
favor of this proposal, and no one testified in opposition. The three 
witnesses covered similar themes in expressing their views on the 
proposal.
    Each stated that the U.S. potato market is highly competitive and 
that the potato industry in Washington needs to be vigilant in 
responding to market needs so as not to lose market share to other 
states. Testimony indicated that the fresh market potato industry in 
Washington needs to ensure that their customers are receiving what they 
order, and must remain flexible and innovative. All three witnesses 
emphasized that offering appropriate packaging is a key element of 
being flexible and responsive to customers.
    The witnesses offered an historical perspective by pointing out 
that 40 years ago, the industry standard for potato packaging was a 50- 
or 100-pound burlap bag. The passing of 30 years saw the phasing in of 
50-pound cartons and polyethylene (poly) bags. Now, potatoes are 
shipped in burlap, cartons, poly, mesh, cardboard bulk displays and 
baler bags. Container sizes can range from 2 pounds to 100 pounds. It 
was emphasized that the industry is constantly looking for new 
packaging and delivery methods.
    Witnesses stated that as early as 1994, the Committee began 
receiving requests from retailers and wholesalers to pack U.S. No. 2 
grade potatoes from Washington in 50 lb. cartons. These customers cited 
a number of reasons for wanting the U.S. No. 2 grade potatoes in 
cartons, including ease of handling and stacking in warehouses, 
improved worker safety, and better product protection (for example, 
less ``greening'' from exposure to light, and reduced bruising during 
transport.)
    Although authority exists in the order for the Committee to 
recommend regulations to allow packing of U.S. No. 2 grade potatoes in 
cartons, witnesses explained that up until now the Committee has chosen 
not to permit this lower grade to be packed in cartons because of the 
inability to mandate labeling. The current handling regulations specify 
that only U.S. No. 1 or better grade potatoes may be packed in cartons, 
and as such, buyers of Washington potatoes have learned to expect this 
premium grade when purchasing potatoes in cartons. Adding this labeling 
authority will provide assurance to customers and to the industry that 
the product being shipped is properly identified. Mandatory labeling 
prevents handlers from misrepresenting the quality of the potatoes 
packed in the carton. Even one handler sending substandard product to 
customers can mar the reputation of the Washington State potato 
industry, according to witnesses.
    Witnesses stated that upholding the integrity of the Washington 
State potato industry is as important to producers as meeting customer 
specifications. Mandating labeling will help ensure product integrity. 
The Committee has discussed that without the labeling authority, a 
customer could potentially receive U.S. No. 2 grade potatoes from a 
handler, thinking that they are of U.S. No. 1 grade quality. This could 
damage customer perceptions of the higher-grade potatoes coming out of 
Washington. Labeling authority will help alleviate consumer perception 
problems. Further, not only will it help verify that handlers are 
putting the right product into the right packaging, but it also will 
assure customers that they are actually receiving what they have 
ordered.
    Witnesses also emphasized the minimal additional cost of 
implementing this proposal. They point out that handlers' facilities 
are already configured for packing potatoes in cartons, and for 
labeling those cartons, so there is no need for any equipment changes 
or additions. In the witnesses' view, any additional costs a handler 
would have in packing potatoes in cartons rather than sacks would be 
offset by the increased selling price.
    Requiring labeling of cartons will help to improve market 
transactions between seller and buyer by assuring all concerned as to 
the exact content of such cartons. Washington producers and handlers 
will benefit from taking advantage of another market niche, with 
minimal additional cost.
    Testimony and industry data together indicate that little to no 
differential impact between small versus large producers or handlers 
would result from the proposed amendment to authorize container and 
labeling requirements. Although not easily quantifiable, the USDA 
concurs that benefits to the potato industry appear to substantially 
outweigh the potential costs associated with implementing this 
proposal.
    Remaining amendment proposals are administrative in nature and will 
impose no new regulatory burdens on Washington potato producers or 
handlers. They should benefit the industry by improving the operation 
of the program and making it more responsive to industry needs.
    This final rule amends Sec.  946.25, Selection, of the order to 
require that producer members of the Committee are current producers of 
fresh potatoes. The amendment will ensure that the Committee is 
representative of, and responsive to, those producers the program 
impacts most directly. No additional costs are anticipated.
    This final rule amends Sec.  946.31, Districts, by replacing 
obsolete order language pertaining to establishment of districts and 
allocation of Committee membership among those districts will simply 
update the order. To the extent updating order language simplifies the 
program and reduces confusion, it will benefit the industry.
    This final rule amends Sec.  946.32, Nomination, of the order to 
allow nominations of Committee members to be conducted through mail 
balloting or at meetings held in each of the five established 
districts. Allowing nominations to be made at larger, industry-wide 
meetings will provide the industry with an additional option. This 
option could result in the Committee reaching a larger audience of 
producers and handlers, thereby broadening

[[Page 41132]]

industry participation and facilitating the nomination process.
    This final rule amends Sec.  946.23, Alternate members, by adding 
authority to the marketing order that will allow temporary alternates 
to serve when a Committee member and that member's alternate are unable 
to serve. It will also amend Sec.  946.22, Establishment and 
membership, and Sec.  946.24, Procedure, by adding authority to the 
marketing order to allow for changes in the size of the Committee. The 
Washington Potato Committee consists of 10 producers, 5 handlers, and 
their alternates. Changing the size of the Committee will allow the 
industry to adjust to changes in fresh potato production patterns and 
in the number of active industry participants.
    An increase in Committee size could lead to marginally higher 
program costs because Committee members are reimbursed for expenses 
they incur in attending meetings and performing other duties under the 
order. A reduction in Committee size (deemed to be more likely 
according to the record) would likewise reduce program costs. Any 
recommendation to change the size of the Committee would be considered 
in terms of cost and the need to ensure appropriate representation of 
producers and handlers in Committee deliberations.
    This final rule amends Sec.  946.63, Termination, to require 
periodic continuance referenda to ascertain industry support for the 
program will allow producers the opportunity to vote on whether to 
continue the operation of the order.

Paperwork Reduction Act

    In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 
3501, et seq.), any reporting and recordkeeping provision changes that 
would be generated by these amendments would be submitted to the Office 
of Management and Budget (OMB). Current information collection 
requirements for part 946 are approved by OMB under OMB number 0581-
0178.
    The Washington Potato Committee recommended amending producer 
eligibility requirements to require production of potatoes for the 
fresh market for 3 out of the 5 years of production prior to 
nomination. The Committee has also made recommendations that would 
streamline the nomination process and increase industry participation 
in nominations. In conformance with these recommendations, the 
confidential qualification and acceptance statement will be combined in 
the appointment of committee members. This form is based on the 
currently approved Confidential Background Statement for the Washington 
Potato Marketing Committee, and no change in the information collection 
burden or further OMB approval is necessary.
    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.
    USDA has not identified any relevant Federal rules that duplicate, 
overlap or conflict with this proposed rule. These amendments are 
designed to enhance the administration and functioning of the marketing 
order to the benefit of the industry.
    Committee meetings regarding these proposals as well as the hearing 
dates were widely publicized throughout the Washington potato industry, 
and all interested persons were invited to attend the meetings and the 
hearing and participate in Committee deliberations on all issues. All 
Committee meetings and the hearing were public forums and all entities, 
both large and small, were able to express views on these issues.

Civil Justice Reform

    The amendments to Marketing Order 946 proposed herein have been 
reviewed under Executive Order 12988, Civil Justice Reform. They are 
not intended to have retroactive effect. When adopted, these amendments 
will not preempt any State or local laws, regulations, or policies, 
unless they present an irreconcilable conflict with this proposal.
    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 Department 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 
there from. A handler is afforded the opportunity for a hearing on the 
petition. After the hearing, the USDA 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 
Department's ruling on the petition, provided an action is filed not 
later than 20 days after the date of the entry of the ruling.

Order Amending the Order Regulating Irish Potatoes Grown in Washington

Findings and Determinations

    The findings and determinations set forth hereinafter are 
supplementary and in addition to the findings and determination 
previously made in connection with the issuance of the order; and all 
of said previous findings and determinations are hereby ratified and 
affirmed, except as such findings and determinations may be in conflict 
with the findings and determinations set forth herein.

(a) Findings and Determinations Upon the Basis of the Hearing Record

    Pursuant to the provisions of the Agricultural Marketing Agreement 
Act of 1937, as amended (7 U.S.C. 601 et seq.) and the applicable rules 
of practice and procedure effective thereunder (7 CFR part 900), a 
public hearing was held upon the proposed amendments to Marketing Order 
No. 946 (7 CFR part 946), regulating the handling of Irish potatoes 
grown in Washington.
    Upon the basis of the evidence introduced at such hearing and the 
record thereof it is found that:
    (1) The marketing order, as amended, and as hereby further amended, 
and all of the terms and conditions thereof, will tend to effectuate 
the declared policy of the Act;
    (2) The marketing order, as amended, and as hereby further amended, 
regulates the handling of Irish potatoes grown in the production area 
in the same manner as, and is applicable only to persons in the 
respective classes of commercial and industrial activity specified in 
the marketing order upon which hearings have been held;
    (3) The marketing order, as amended, and as hereby further amended, 
is limited in application to the smallest regional production area 
which is practicable, consistent with carrying out the declared policy 
of the Act, and the issuance of several orders applicable to 
subdivision of the production area would not effectively carry out the 
declared policy of the Act;
    (4) The marketing order, as amended, and as hereby further amended, 
prescribes, insofar as practicable, such different terms applicable to 
different parts of the production area as are necessary to give due 
recognition to the differences in the production and marketing of Irish 
potatoes grown in the production area; and
    (5) All handling of Irish potatoes grown in the production area is 
in the current of interstate or foreign commerce or directly burdens, 
obstructs, or affects such commerce.

[[Page 41133]]

    (b) Additional findings. It is necessary and in the public interest 
to make the amendments to this order effective not later than one day 
after publication in the Federal Register. A later effective date would 
unnecessarily delay implementation of the approved changes, which are 
expected to benefit the Washington Irish potato industry. Immediate 
implementation of the amendments is necessary in order to make the 
amendments effective as specified.
    In view of the foregoing, it is hereby found and determined that 
good cause exists for making these amendments effective one day after 
publication in the Federal Register, and that it would be contrary to 
the public interest to delay the effective date for 30 days after 
publication in the Federal Register (Sec. 553(d), Administrative 
Procedure Act; 5 U.S.C. 551-559).
    (c) Determinations. It is hereby determined that:
    (1) Handlers (excluding cooperative associations of producers who 
are not engaged in processing, distributing, or shipping Irish potatoes 
covered by the order as hereby amended) who, during the period July 1, 
2003, through June 30, 2004, handled 50 percent or more of the volume 
of such Irish potatoes covered by said order, as hereby amended, have 
not signed an amended marketing agreement;
    (2) The issuance of this amendatory order, further amending the 
aforesaid order, is favored or approved by at least two-thirds of the 
producers who participated in a referendum on the question of approval 
and who, during the period of July 1, 2003, through June 30, 2004 
(which has been deemed to be a representative period), have been 
engaged within the production area in the production of such Irish 
potatoes, such producers having also produced for market at least two-
thirds of the volume of such commodity represented in the referendum; 
and
    (3) In the absence of a signed marketing agreement, the issuance of 
this amendatory order is the only practical means pursuant to the 
declared policy of the Act of advancing the interests of producers of 
Irish potatoes in the production area.

Order Relative to Handling of Irish Potatoes Grown in Washington

    It is therefore ordered, That on and after the effective date 
hereof, all handling of Irish potatoes grown in Washington shall be in 
conformity to, and in compliance with, the terms and conditions of the 
said order as hereby amended as follows:
    The provisions of the proposed marketing order amending the order 
contained in the Recommended Decision issued by the Administrator on 
November 19, 2004, and published in the Federal Register on November 
26, 2004, shall be and are the terms and provisions of this order 
amending the order and set forth in full herein.

List of Subjects in 7 CFR Part 946

    Marketing agreements, Potatoes, Reporting and recordkeeping 
requirements.


0
For the reasons set out it the preamble, 7 CFR part 946 is amended as 
follows:

PART 946--IRISH POTATOES GROWN IN WASHINGTON

0
1. The authority citation for 7 CFR part 946 continues to read as 
follows:

    Authority: 7 U.S.C. 601-674.

0
2. Add a new Sec.  946.17 to read as follows:


Sec.  946.17  Pack.

    Pack means a quantity of potatoes in any type of container and 
which falls within the specific weight limits or within specific grade 
and/or size limits, or any combination thereof, recommended by the 
committee and approved by the Secretary.

0
3. Add a new Sec.  946.18 to read as follows:


Sec.  946.18  Container.

    Container means a sack, box, bag, crate, hamper, basket, carton, 
package, barrel, or any other type of receptacle used in the packing, 
transportation, sale or other handling of potatoes.

0
4. In Sec.  946.22, designate the current text as paragraph (a) and add 
a new paragraph (b) to read as follows:


Sec.  946.22  Establishment and membership.

* * * * *
    (b) The Secretary, upon recommendation of the committee, may 
reestablish districts, may reapportion members among districts, may 
change the number of members and alternate members, and may change the 
composition by changing the ratio of members, including their 
alternates. In recommending any such changes, the following shall be 
considered:
    (1) Shifts in acreage within districts and within the production 
area during recent years;
    (2) The importance of new production in its relation to existing 
districts;
    (3) The equitable relationship between committee apportionment and 
districts; and
    (4) Other relevant factors.

0
5. In Sec.  946.23, designate the current text as paragraph (a) and add 
a new paragraph (b) to read as follows:


Sec.  946.23  Alternate members.

* * * * *
    (b) In the event that both a member and his or her alternate are 
unable to attend a Committee meeting, the member, the alternate member, 
or the Committee members present, in that order, may designate another 
alternate of the same classification (handler or producer) to serve in 
such member's place and stead.

0
6. Section 946.24 is amended by:
0
A. Revising paragraph (a).
0
B. Redesignating paragraph (b) as paragraph (c).
0
C. Adding a new paragraph (b).
    The revisions read as follows:


Sec.  946.24  Procedure.

    (a) Sixty percent of the committee members shall constitute a 
quorum and a concurring vote of 60 percent of the committee members 
will be required to pass any motion or approve any committee action.
    (b) The quorum and voting requirements of paragraph (a) of this 
section shall not apply to the designation of temporary alternates as 
provided in Sec.  946.23.
* * * * *

0
7. Section 946.25 is amended by:
0
A. Revising paragraph (a).
0
B. Revising paragraph (c).
    The revisions read as follows:


Sec.  946.25  Selection.

    (a) Persons selected as committee members or alternates to 
represent producers shall be individuals who are producers of fresh 
potatoes in the respective district for which selected, or officers or 
employees of a corporate producer in such district. Such individuals 
must also have produced potatoes for the fresh market for at least 
three out of the five years prior to nomination.
* * * * *
    (c) The Secretary shall select committee membership so that, during 
each fiscal period, each district, as designated in Sec.  946.31, will 
be represented as follows:
    (1) District No. 1--Three producer members and one handler member;
    (2) District No. 2--Two producer members and one handler member;
    (3) District No. 3--Two producer members and one handler member;
    (4) District No. 4--Two producer members and one handler member;
    (5) District No. 5--One producer member and one handler member.

[[Page 41134]]


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8. Revise Sec.  946.31 to read as follows:


Sec.  946.31  Districts.

    For the purpose of determining the basis for selecting committee 
members, the following districts of the production area are hereby 
established:
    (a) District No. 1--The counties of Ferry, Stevens, Pend Oreille, 
Spokane, Whitman, and Lincoln, plus the East Irrigation District of the 
Columbia Basin Project, plus the area of Grant County not included in 
either the Quincy or South Irrigation Districts which lies east of 
township vertical line R27E, plus the area of Adams County not included 
in either of the South or Quincy Irrigation Districts.
    (b) District No. 2--The counties of Kittitas, Douglas, Chelan, and 
Okanogan, plus the Quincy Irrigation District of the Columbia Basin 
Project, plus the area of Grant County not included in the East or 
South Irrigation Districts which lies west of township line R28E.
    (c) District No. 3--The counties of Benton, Klickitat, and Yakima.
    (d) District No. 4--The counties of Walla Walla, Columbia, 
Garfield, and Asotin, plus the South Irrigation District of the 
Columbia Basin Project, plus the area of Franklin County not included 
in the South District.
    (e) District No. 5--All of the remaining counties in the State of 
Washington not included in Districts No. 1, 2, 3, and 4 of this 
section.

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9. Amend Sec.  946.32 by revising paragraph (a) to read as follows:


Sec.  946.32  Nomination.

* * * * *
    (a) Nominations for Committee members and alternate members shall 
be made at a meeting or meetings of producers and handlers held by the 
Committee or at other industry meetings or events not later than May 1 
of each year; or the Committee may conduct nominations by mail not 
later than May 1 of each year in a manner recommended by the Committee 
and approved by the Secretary.
* * * * *
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10. Amend Sec.  946.52 by adding a new paragraph (a)(5) to read as 
follows:


Sec.  946.52  Issuance of regulations.

    (a) * * *
    (5) To regulate the size, capacity, weight, dimensions, pack, and 
marking or labeling of the container, or containers, which may be used 
in the packing or handling of potatoes, or both.
* * * * *

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11. In Sec.  946.63, redesignate paragraph (d) as paragraph (e) and add 
a new paragraph (d) to read as follows:


Sec.  946.63  Termination.

* * * * *
    (d) The Secretary shall conduct a referendum six years after the 
effective date of this paragraph and every sixth thereafter to 
ascertain whether producers favor continuance of this part.
* * * * *

    Dated: July 11, 2005.
Kenneth C. Clayton,
Acting Administrator, Agricultural Marketing Service.
[FR Doc. 05-14004 Filed 7-15-05; 8:45 am]
BILLING CODE 3410-02-P