Tart Cherries Grown in the States of Michigan, New York, Pennsylvania, Oregon, Utah, Washington and Wisconsin; Modification of Allocation of Assessments, 41827-41829 [2017-18756]
Download as PDF
<![CDATA[
Federal Register / Vol. 82, No. 170 / Tuesday, September 5, 2017 / Rules and Regulations
*
M. media Marvel (PPAF)
*
*
*
*
Done in Washington, DC, this 30th day of
August 2017.
Michael C. Gregoire,
Acting Administrator, Animal and Plant
Health Inspection Service.
[FR Doc. 2017–18712 Filed 9–1–17; 8:45 am]
BILLING CODE 3410–34–P
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 930
[Doc. No. AMS–SC–16–0104; SC16–930–4
FR]
Tart Cherries Grown in the States of
Michigan, New York, Pennsylvania,
Oregon, Utah, Washington and
Wisconsin; Modification of Allocation
of Assessments
Agricultural Marketing Service,
USDA.
ACTION: Final rule.
AGENCY:
This rule implements a
recommendation from the Tart Cherry
Industry Administrative Board (Board)
to increase the portion of assessments
allocated to research and promotion
activities from $0.005 to $0.0065 per
pound of tart cherries and decrease the
portion allocated to administrative
expenses from $0.0025 to $0.001 per
pound of tart cherries handled under
the marketing order (order). This rule
also corrects the allocation numbers
from $0.006 per pound for research and
promotion activities and $0.0015 per
pound for administrative expenses as
stated in the proposed rule based on a
comment received. The overall
assessment rate remains unchanged at
$0.0075 per pound of tart cherries. The
Board locally administers the order and
is comprised of producers and handlers
of tart cherries operating within the area
of production, and one public member.
Assessments upon tart cherry handlers
are used by the Board to fund
reasonable and necessary expenses of
the program. The fiscal period begins
October 1 and ends September 30. The
assessment rate will remain in effect
indefinitely unless modified,
suspended, or terminated.
DATES: Effective September 6, 2017.
FOR FURTHER INFORMATION CONTACT:
Jennie M. Varela, Marketing Specialist,
or Christian D. Nissen, Regional
Director, Southeast Marketing Field
Office, Marketing Order and Agreement
Division, Specialty Crops Program,
AMS, USDA; Telephone: (863) 324–
mstockstill on DSK30JT082PROD with RULES
SUMMARY:
VerDate Sep<11>2014
16:52 Sep 01, 2017
Jkt 241001
3375, Fax: (863) 291–8614, or Email:
Jennie.Varela@ams.usda.gov or
Christian.Nissen@ams.usda.gov.
Small businesses may request
information on complying with this
regulation by contacting Richard Lower,
Marketing Order and Agreement
Division, Specialty Crops Program,
AMS, USDA, 1400 Independence
Avenue SW., STOP 0237, Washington,
DC 20250–0237; Telephone: (202) 720–
2491, Fax: (202) 720–8938, or Email:
Richard.Lower@ams.usda.gov.
SUPPLEMENTARY INFORMATION: This rule
is issued under Marketing Agreement
and Order No. 930, both as amended (7
CFR part 930), regulating the handling
of tart cherries produced in the States of
Michigan, New York, Pennsylvania,
Oregon, Utah, Washington and
Wisconsin, hereinafter referred to as the
‘‘order.’’ The order is 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
(USDA) is issuing this final rule in
conformance with Executive Orders
13563 and 13175. This rule does not
meet the definition of a significant
regulatory action contained in section
3(f) of Executive Order 12866 and is not
subject to review by the Office of
Management and Budget (OMB).
Additionally, because this rule does not
meet the definition of a significant
regulatory action, it does not trigger the
requirements contained in Executive
Order 13771. See OMB’s Memorandum
titled, ‘‘Interim Guidance Implementing
Section 2 of the Executive Order of
January 30, 2017, titled ‘Reducing
Regulation and Controlling Regulatory
Costs’ ’’ (February 2, 2017).
This rule has been reviewed under
Executive Order 12988, Civil Justice
Reform. Under the marketing order now
in effect, tart cherry 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 tart cherries
beginning on October 1, 2016, and
continue until amended, suspended, or
terminated.
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 USDA 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
PO 00000
Frm 00003
Fmt 4700
Sfmt 4700
41827
a hearing on the petition. After the
hearing, 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 USDA’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 portion of the
assessment rate allocated to research
and promotion activities from $0.005 to
$0.0065 per pound of tart cherries
handled and decreases the portion
allocated to administrative expenses
from $0.0025 to $0.001 per pound of tart
cherries handled under the order. This
rule also corrects the allocation numbers
from $0.006 per pound for research and
promotion activities and $0.0015 per
pound for administrative expenses as
stated in the proposed rule based on a
comment received. The overall
assessment rate for the 2016–17 and
subsequent fiscal periods remains
unchanged at $0.0075 per pound of tart
cherries.
The tart cherry marketing order
provides authority for the Tart Cherry
Industry Administrative Board (Board),
with the approval of USDA, to formulate
an annual budget of expenses and
collect assessments from handlers to
administer the program. The members
of the Board are producers and handlers
of tart cherries, and one public member.
They are familiar with the Board’s needs
and with the costs of goods and services
in their local areas 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 2010–11 and subsequent fiscal
periods, the Board recommended, and
USDA approved, an assessment rate of
$0.0075 per pound of tart cherries that
would continue in effect from fiscal
period to fiscal period unless modified,
suspended, or terminated by USDA
upon recommendation and information
submitted by the Board or other
information available to USDA.
The Board met on September 8, 2016,
and unanimously recommended 2016–
17 expenditures of $2,523,550 and an
assessment rate of $0.0075 per pound of
tart cherries. In comparison, last year’s
budgeted expenditures were $1,725,000.
The total assessment rate remains
unchanged by this action. However, this
rule increases the portion of the
assessment rate allocated to research
and promotion activities from $0.005 to
E:\FR\FM\05SER1.SGM
05SER1
mstockstill on DSK30JT082PROD with RULES
41828
Federal Register / Vol. 82, No. 170 / Tuesday, September 5, 2017 / Rules and Regulations
$0.0065 per pound of tart cherries
handled and decreases the portion
allocated to administrative expenses
from $0.0025 to $0.001 per pound of tart
cherries handled under the order. This
shift in allocation will allow for
expanded research and promotion
activities to help market this season’s
above-average crop, while helping to
ensure that funds held in the Board’s
authorized reserve are consistent with
the order’s limits on the reserve.
The major expenditures
recommended by the Board for the
2016–17 fiscal year include $2,045,550
for promotion, $255,000 for personnel,
and $106,000 for office expenses.
Budgeted expenses for these items in
2015–16 were $1,150,000, $236,000, and
$102,000, respectively.
The assessment rate recommended by
the Board was derived by considering
expected shipments of tart cherries and
examining the needs of the industry
with regard to research and promotion
and the authorized reserve. Tart cherry
shipments for the 2016–17 year are
estimated at 314.7 million pounds,
which should provide $2,360,250 in
assessment income. Income derived
from handler assessments, interest
income, and funds from the Board’s
authorized reserve should be adequate
to cover budgeted expenses. Funds in
the reserve (approximately $894,000)
will be kept within the maximum
permitted by the order of no more than
approximately one year’s operational
expenses as stated in § 930.42(a).
The assessment rate will continue in
effect indefinitely unless modified,
suspended, or terminated by USDA
upon recommendation and information
submitted by the Board or other
available information.
Although this assessment rate will be
in effect for an indefinite period, the
Board 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 Board meetings are available from the
Board or USDA. Board meetings are
open to the public, and interested
persons may express their views at these
meetings. USDA will evaluate Board
recommendations and other available
information to determine whether
modification of the assessment rate is
needed. Further rulemaking would be
undertaken as necessary. The Board’s
budget for future fiscal periods will be
reviewed and, as appropriate, approved
by USDA.
Final Regulatory Flexibility Analysis
Pursuant to requirements set forth in
the Regulatory Flexibility Act (RFA) (5
VerDate Sep<11>2014
16:52 Sep 01, 2017
Jkt 241001
U.S.C. 601–612), 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
businesses subject to such actions in
order that small businesses will not be
unduly or disproportionately burdened.
Marketing orders issued pursuant to the
Act, and rules issued thereunder, are
unique in that they are brought about
through group action of essentially
small entities acting on their own
behalf.
There are approximately 600
producers of tart cherries in the
regulated area and approximately 40
handlers of tart cherries who are subject
to regulation under the order. Small
agricultural producers are defined by
the Small Business Administration
(SBA) as those having annual receipts of
less than $750,000, and small
agricultural service firms have been
defined as those whose annual receipts
are less than $7,500,000 (13 CFR
121.201).
According to the National
Agricultural Statistics Service and
Board data, the average annual grower
price for tart cherries during the 2015–
16 season was approximately $0.347 per
pound. With total utilization at 251.1
million pounds, the total 2015–16 crop
value is estimated at $87 million.
Dividing the crop value by the estimated
number of producers (600) yields an
estimated average receipt per producer
of $145,000. This is well below the SBA
threshold for small producers. In 2015,
The Food Institute estimated a free on
board (f.o.b.) price of $0.96 per pound
for frozen tart cherries, which make up
the majority of processed tart cherries.
Multiplying the f.o.b price by total
utilization of 251.1 million pounds
results in an estimated handler-level tart
cherry value of $241 million. Dividing
this figure by the number of handlers
(40) yields an estimated average annual
handler receipts of $6 million, which is
below the SBA threshold for small
agricultural service firms. Assuming a
normal distribution, the majority of
producers and handlers of tart cherries
may be classified as small entities.
This rule increases the portion of the
assessment rate allocated to research
and promotion activities from $0.005 to
$0.0065 per pound of tart cherries
handled and decreases the portion
allocated to administrative expenses
from $0.0025 to $0.001 per pound of tart
cherries handled under the order. This
rule also corrects the allocation numbers
from $0.006 per pound for research and
PO 00000
Frm 00004
Fmt 4700
Sfmt 4700
promotion activities and $0.0015 per
pound for administrative expenses as
stated in the proposed rule based on a
comment received. The overall
assessment rate established for the
Board for the 2016–17 and subsequent
fiscal periods remains unchanged at
$0.0075 per pound of tart cherries. The
quantity of assessable tart cherries for
the 2016–17 season is estimated at 314.7
million pounds. Thus, the $0.0075 rate
should provide $2,360,250 in
assessment income. Income derived
from handler assessments, interest
income, and funds from the Board’s
authorized reserve should provide
sufficient funds to meet this year’s
anticipated expenses.
The major expenditures
recommended by the Board for the
2016–17 year include $2,045,550 for
promotion, $255,000 for personnel, and
$106,000 for office expenses. Budgeted
expenses for these items in 2015–16
were $1,150,000, $236,000, and
$102,000, respectively.
This rule shifts the allocation of the
assessment rate to increase the portion
allocated for research and promotion,
while decreasing the portion allocated
for administrative costs. This
adjustment will allow for expanded
research and promotion activities to
help market this season’s above-average
crop, while helping to ensure that funds
held in the Board’s authorized reserve
are consistent with the order’s limits on
the reserve.
Prior to arriving at this budget and
assessment rate, the Board considered
production history, crop estimates, its
financial statements, and the need to
both reduce financial reserves and
increase its marketing efforts to increase
demand for tart cherries. The Board also
considered not taking this action but
determined that 2016–17 expenditures
of $2,523,550 were appropriate, and the
recommended assessment rate and
allocation, along with funds from
interest income, block grants, and funds
from reserves, would be adequate to
cover budgeted expenses.
A review of historical information and
preliminary information pertaining to
the upcoming crop year indicates that
the average grower price for the 2016–
17 season could be approximately
$0.348 per pound of tart cherries.
Therefore, the estimated assessment
revenue for the 2016–17 crop year as a
percentage of total grower revenue
could be approximately 2 percent.
This action does not increase 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 costs may be
E:\FR\FM\05SER1.SGM
05SER1
mstockstill on DSK30JT082PROD with RULES
Federal Register / Vol. 82, No. 170 / Tuesday, September 5, 2017 / Rules and Regulations
passed on to producers. However, these
costs are offset by the benefits derived
by the operation of the marketing order.
The Board’s meetings were widely
publicized throughout the tart cherry
industry, and all interested persons
were invited to attend the meetings and
participate in Board deliberations on all
issues. Like all Board meetings, the June
23, 2016, and September 8, 2016,
meetings were public meetings, and all
entities, both large and small, were able
to express views on this issue.
In accordance with the Paperwork
Reduction Act of 1995 (44 U.S.C.
Chapter 35), the order’s information
collection requirements have been
previously approved by OMB and
assigned OMB No. 0581–0177, Tart
Cherries Grown in the States of
Michigan, New York, Pennsylvania,
Oregon, Utah, Washington, and
Wisconsin. No changes in those
requirements are necessary as a result of
this action. Should any changes become
necessary, they would be submitted to
OMB for approval.
This rule imposes no additional
reporting or recordkeeping requirements
on either small or large tart cherry
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. As noted in the initial
regulatory flexibility analysis, USDA
has not identified any relevant Federal
rules that duplicate, overlap, or conflict
with this final rule.
AMS is committed to complying with
the E-Government Act, to promote the
use of the Internet and other
information technologies to provide
increased opportunities for citizen
access to Government information and
services, and for other purposes.
A proposed rule concerning this
action was published in the Federal
Register on May 25, 2017(82 FR 24080).
Copies of the proposed rule were also
mailed or sent via facsimile to all tart
cherry handlers. Finally, the proposal
was made available through the internet
by USDA and the Office of the Federal
Register. A 30-day comment period
ending June 26, 2017, was provided for
interested persons to respond to the
proposal.
One comment was received from
Board staff indicating that the Board
minutes stated the recommendation was
for assessment allocation of $0.0065 per
pound of tart cherries for promotion and
$0.001 per pound of tart cherries for
administration rather than the $0.006
and $0.0015, respectively, as published
in the proposed rule. Accordingly, the
VerDate Sep<11>2014
16:52 Sep 01, 2017
Jkt 241001
allocation numbers were revised based
on the comment received.
A small business guide on complying
with fruit, vegetable, and specialty crop
marketing agreements and orders may
be viewed at: https://www.ams.usda.gov/
rules-regulations/moa/small-businesses.
Any questions about the compliance
guide should be sent to Richard Lower
at the previously mentioned address in
the FOR FURTHER INFORMATION CONTACT
section.
After consideration of all relevant
material presented, including the
information and recommendation
submitted by the Board 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 fiscal year ends on
September 30, 2017, and the change in
allotment of assessments collected is
necessary to ensure sufficient funds are
available to cover the increase in
research and promotion expenses that
were incurred to help market the 2016–
17 above-average crop. 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 and
no negative comments were received.
List of Subjects in 7 CFR Part 930
Marketing agreements, Reporting and
recordkeeping requirements, Tart
cherries.
For the reasons set forth in the
preamble, 7 CFR part 930 is amended as
follows:
PART 930—TART CHERRIES GROWN
IN THE STATES OF MICHIGAN, NEW
YORK, PENNSYLVANIA, OREGON,
UTAH, WASHINGTON, AND
WISCONSIN
1. The authority citation for 7 CFR
part 930 continues to read as follows:
■
Authority: 7 U.S.C. 601–674.
2. Section 930.200 is revised to read
as follows:
■
§ 930.200
Assessment rate.
On and after October 1, 2016, the
assessment rate imposed on handlers
shall be $0.0075 per pound of tart
cherries grown in the production area
and utilized in the production of tart
cherry products. Included in this rate is
$0.0065 per pound of tart cherries to
cover the cost of the research and
promotion program and $0.001 per
PO 00000
Frm 00005
Fmt 4700
Sfmt 4700
41829
pound of tart cherries to cover
administrative expenses.
Dated: August 30, 2017.
Bruce Summers,
Acting Administrator, Agricultural Marketing
Service.
[FR Doc. 2017–18756 Filed 9–1–17; 8:45 am]
BILLING CODE 3410–02–P
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 1205
[Doc. # AMS–CN–17–0003]
Cotton Board Rules and Regulations:
Adjusting Supplemental Assessment
on Imports (2017 Amendments)
Agricultural Marketing Service,
USDA.
ACTION: Direct final rule.
AGENCY:
The Agricultural Marketing
Service (AMS) is amending the Cotton
Board Rules and Regulations, increasing
the value assigned to imported cotton
for the purposes of calculating
supplemental assessments collected for
use by the Cotton Research and
Promotion Program. This amendment is
required each year to ensure that
assessments collected on imported
cotton and the cotton content of
imported products will be the same as
those paid on domestically produced
cotton. In addition, AMS is updating the
Harmonized Tariff Schedule (HTS)
statistical reporting numbers that were
amended since the last assessment
adjustment in 2016.
DATES: This direct rule is effective
November 6, 2017, without further
action or notice, unless significant
adverse comment is received by October
5, 2017. If significant adverse comment
is received, AMS will publish a timely
withdrawal of the amendment in the
Federal Register.
ADDRESSES: Written comments may be
submitted to the addresses specified
below. All comments will be made
available to the public. Please do not
include personally identifiable
information (such as name, address, or
other contact information) or
confidential business information that
you do not want publically disclosed.
All comments may be posted on the
Internet and can be retrieved by most
Internet search engines. Comments may
be submitted anonymously.
Comments, identified by AMS–CN–
17–0003, may be submitted
electronically through the Federal
eRulemaking Portal at https://
SUMMARY:
E:\FR\FM\05SER1.SGM
05SER1
]]>Agencies
[Federal Register Volume 82, Number 170 (Tuesday, September 5, 2017)]
[Rules and Regulations]
[Pages 41827-41829]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-18756]
-----------------------------------------------------------------------
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 930
[Doc. No. AMS-SC-16-0104; SC16-930-4 FR]
Tart Cherries Grown in the States of Michigan, New York,
Pennsylvania, Oregon, Utah, Washington and Wisconsin; Modification of
Allocation of Assessments
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: This rule implements a recommendation from the Tart Cherry
Industry Administrative Board (Board) to increase the portion of
assessments allocated to research and promotion activities from $0.005
to $0.0065 per pound of tart cherries and decrease the portion
allocated to administrative expenses from $0.0025 to $0.001 per pound
of tart cherries handled under the marketing order (order). This rule
also corrects the allocation numbers from $0.006 per pound for research
and promotion activities and $0.0015 per pound for administrative
expenses as stated in the proposed rule based on a comment received.
The overall assessment rate remains unchanged at $0.0075 per pound of
tart cherries. The Board locally administers the order and is comprised
of producers and handlers of tart cherries operating within the area of
production, and one public member. Assessments upon tart cherry
handlers are used by the Board to fund reasonable and necessary
expenses of the program. The fiscal period begins October 1 and ends
September 30. The assessment rate will remain in effect indefinitely
unless modified, suspended, or terminated.
DATES: Effective September 6, 2017.
FOR FURTHER INFORMATION CONTACT: Jennie M. Varela, Marketing
Specialist, or Christian D. Nissen, Regional Director, Southeast
Marketing Field Office, Marketing Order and Agreement Division,
Specialty Crops Program, AMS, USDA; Telephone: (863) 324-3375, Fax:
(863) 291-8614, or Email: Jennie.Varela@ams.usda.gov or
Christian.Nissen@ams.usda.gov.
Small businesses may request information on complying with this
regulation by contacting Richard Lower, Marketing Order and Agreement
Division, Specialty Crops Program, AMS, USDA, 1400 Independence Avenue
SW., STOP 0237, Washington, DC 20250-0237; Telephone: (202) 720-2491,
Fax: (202) 720-8938, or Email: Richard.Lower@ams.usda.gov.
SUPPLEMENTARY INFORMATION: This rule is issued under Marketing
Agreement and Order No. 930, both as amended (7 CFR part 930),
regulating the handling of tart cherries produced in the States of
Michigan, New York, Pennsylvania, Oregon, Utah, Washington and
Wisconsin, hereinafter referred to as the ``order.'' The order is
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 (USDA) is issuing this final rule in
conformance with Executive Orders 13563 and 13175. This rule does not
meet the definition of a significant regulatory action contained in
section 3(f) of Executive Order 12866 and is not subject to review by
the Office of Management and Budget (OMB). Additionally, because this
rule does not meet the definition of a significant regulatory action,
it does not trigger the requirements contained in Executive Order
13771. See OMB's Memorandum titled, ``Interim Guidance Implementing
Section 2 of the Executive Order of January 30, 2017, titled `Reducing
Regulation and Controlling Regulatory Costs'[thinsp]'' (February 2,
2017).
This rule has been reviewed under Executive Order 12988, Civil
Justice Reform. Under the marketing order now in effect, tart cherry
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 tart cherries
beginning on October 1, 2016, and continue until amended, suspended, or
terminated.
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 USDA 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, 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 USDA'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 portion of the assessment rate allocated to
research and promotion activities from $0.005 to $0.0065 per pound of
tart cherries handled and decreases the portion allocated to
administrative expenses from $0.0025 to $0.001 per pound of tart
cherries handled under the order. This rule also corrects the
allocation numbers from $0.006 per pound for research and promotion
activities and $0.0015 per pound for administrative expenses as stated
in the proposed rule based on a comment received. The overall
assessment rate for the 2016-17 and subsequent fiscal periods remains
unchanged at $0.0075 per pound of tart cherries.
The tart cherry marketing order provides authority for the Tart
Cherry Industry Administrative Board (Board), with the approval of
USDA, to formulate an annual budget of expenses and collect assessments
from handlers to administer the program. The members of the Board are
producers and handlers of tart cherries, and one public member. They
are familiar with the Board's needs and with the costs of goods and
services in their local areas 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 2010-11 and subsequent fiscal periods, the Board
recommended, and USDA approved, an assessment rate of $0.0075 per pound
of tart cherries that would continue in effect from fiscal period to
fiscal period unless modified, suspended, or terminated by USDA upon
recommendation and information submitted by the Board or other
information available to USDA.
The Board met on September 8, 2016, and unanimously recommended
2016-17 expenditures of $2,523,550 and an assessment rate of $0.0075
per pound of tart cherries. In comparison, last year's budgeted
expenditures were $1,725,000. The total assessment rate remains
unchanged by this action. However, this rule increases the portion of
the assessment rate allocated to research and promotion activities from
$0.005 to
[[Page 41828]]
$0.0065 per pound of tart cherries handled and decreases the portion
allocated to administrative expenses from $0.0025 to $0.001 per pound
of tart cherries handled under the order. This shift in allocation will
allow for expanded research and promotion activities to help market
this season's above-average crop, while helping to ensure that funds
held in the Board's authorized reserve are consistent with the order's
limits on the reserve.
The major expenditures recommended by the Board for the 2016-17
fiscal year include $2,045,550 for promotion, $255,000 for personnel,
and $106,000 for office expenses. Budgeted expenses for these items in
2015-16 were $1,150,000, $236,000, and $102,000, respectively.
The assessment rate recommended by the Board was derived by
considering expected shipments of tart cherries and examining the needs
of the industry with regard to research and promotion and the
authorized reserve. Tart cherry shipments for the 2016-17 year are
estimated at 314.7 million pounds, which should provide $2,360,250 in
assessment income. Income derived from handler assessments, interest
income, and funds from the Board's authorized reserve should be
adequate to cover budgeted expenses. Funds in the reserve
(approximately $894,000) will be kept within the maximum permitted by
the order of no more than approximately one year's operational expenses
as stated in Sec. 930.42(a).
The assessment rate will continue in effect indefinitely unless
modified, suspended, or terminated by USDA upon recommendation and
information submitted by the Board or other available information.
Although this assessment rate will be in effect for an indefinite
period, the Board 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 Board
meetings are available from the Board or USDA. Board meetings are open
to the public, and interested persons may express their views at these
meetings. USDA will evaluate Board recommendations and other available
information to determine whether modification of the assessment rate is
needed. Further rulemaking would be undertaken as necessary. The
Board's budget for future fiscal periods will be reviewed and, as
appropriate, approved by USDA.
Final Regulatory Flexibility Analysis
Pursuant to requirements set forth in the Regulatory Flexibility
Act (RFA) (5 U.S.C. 601-612), 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
businesses subject to such actions in order that small businesses will
not be unduly or disproportionately burdened. Marketing orders issued
pursuant to the Act, and rules issued thereunder, are unique in that
they are brought about through group action of essentially small
entities acting on their own behalf.
There are approximately 600 producers of tart cherries in the
regulated area and approximately 40 handlers of tart cherries who are
subject to regulation under the order. Small agricultural producers are
defined by the Small Business Administration (SBA) as those having
annual receipts of less than $750,000, and small agricultural service
firms have been defined as those whose annual receipts are less than
$7,500,000 (13 CFR 121.201).
According to the National Agricultural Statistics Service and Board
data, the average annual grower price for tart cherries during the
2015-16 season was approximately $0.347 per pound. With total
utilization at 251.1 million pounds, the total 2015-16 crop value is
estimated at $87 million. Dividing the crop value by the estimated
number of producers (600) yields an estimated average receipt per
producer of $145,000. This is well below the SBA threshold for small
producers. In 2015, The Food Institute estimated a free on board
(f.o.b.) price of $0.96 per pound for frozen tart cherries, which make
up the majority of processed tart cherries. Multiplying the f.o.b price
by total utilization of 251.1 million pounds results in an estimated
handler-level tart cherry value of $241 million. Dividing this figure
by the number of handlers (40) yields an estimated average annual
handler receipts of $6 million, which is below the SBA threshold for
small agricultural service firms. Assuming a normal distribution, the
majority of producers and handlers of tart cherries may be classified
as small entities.
This rule increases the portion of the assessment rate allocated to
research and promotion activities from $0.005 to $0.0065 per pound of
tart cherries handled and decreases the portion allocated to
administrative expenses from $0.0025 to $0.001 per pound of tart
cherries handled under the order. This rule also corrects the
allocation numbers from $0.006 per pound for research and promotion
activities and $0.0015 per pound for administrative expenses as stated
in the proposed rule based on a comment received. The overall
assessment rate established for the Board for the 2016-17 and
subsequent fiscal periods remains unchanged at $0.0075 per pound of
tart cherries. The quantity of assessable tart cherries for the 2016-17
season is estimated at 314.7 million pounds. Thus, the $0.0075 rate
should provide $2,360,250 in assessment income. Income derived from
handler assessments, interest income, and funds from the Board's
authorized reserve should provide sufficient funds to meet this year's
anticipated expenses.
The major expenditures recommended by the Board for the 2016-17
year include $2,045,550 for promotion, $255,000 for personnel, and
$106,000 for office expenses. Budgeted expenses for these items in
2015-16 were $1,150,000, $236,000, and $102,000, respectively.
This rule shifts the allocation of the assessment rate to increase
the portion allocated for research and promotion, while decreasing the
portion allocated for administrative costs. This adjustment will allow
for expanded research and promotion activities to help market this
season's above-average crop, while helping to ensure that funds held in
the Board's authorized reserve are consistent with the order's limits
on the reserve.
Prior to arriving at this budget and assessment rate, the Board
considered production history, crop estimates, its financial
statements, and the need to both reduce financial reserves and increase
its marketing efforts to increase demand for tart cherries. The Board
also considered not taking this action but determined that 2016-17
expenditures of $2,523,550 were appropriate, and the recommended
assessment rate and allocation, along with funds from interest income,
block grants, and funds from reserves, would be adequate to cover
budgeted expenses.
A review of historical information and preliminary information
pertaining to the upcoming crop year indicates that the average grower
price for the 2016-17 season could be approximately $0.348 per pound of
tart cherries. Therefore, the estimated assessment revenue for the
2016-17 crop year as a percentage of total grower revenue could be
approximately 2 percent.
This action does not increase 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 costs
may be
[[Page 41829]]
passed on to producers. However, these costs are offset by the benefits
derived by the operation of the marketing order.
The Board's meetings were widely publicized throughout the tart
cherry industry, and all interested persons were invited to attend the
meetings and participate in Board deliberations on all issues. Like all
Board meetings, the June 23, 2016, and September 8, 2016, meetings were
public meetings, and all entities, both large and small, were able to
express views on this issue.
In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C.
Chapter 35), the order's information collection requirements have been
previously approved by OMB and assigned OMB No. 0581-0177, Tart
Cherries Grown in the States of Michigan, New York, Pennsylvania,
Oregon, Utah, Washington, and Wisconsin. No changes in those
requirements are necessary as a result of this action. Should any
changes become necessary, they would be submitted to OMB for approval.
This rule imposes no additional reporting or recordkeeping
requirements on either small or large tart cherry 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. As noted in the initial regulatory
flexibility analysis, USDA has not identified any relevant Federal
rules that duplicate, overlap, or conflict with this final rule.
AMS is committed to complying with the E-Government Act, to promote
the use of the Internet and other information technologies to provide
increased opportunities for citizen access to Government information
and services, and for other purposes.
A proposed rule concerning this action was published in the Federal
Register on May 25, 2017(82 FR 24080). Copies of the proposed rule were
also mailed or sent via facsimile to all tart cherry handlers. Finally,
the proposal was made available through the internet by USDA and the
Office of the Federal Register. A 30-day comment period ending June 26,
2017, was provided for interested persons to respond to the proposal.
One comment was received from Board staff indicating that the Board
minutes stated the recommendation was for assessment allocation of
$0.0065 per pound of tart cherries for promotion and $0.001 per pound
of tart cherries for administration rather than the $0.006 and $0.0015,
respectively, as published in the proposed rule. Accordingly, the
allocation numbers were revised based on the comment received.
A small business guide on complying with fruit, vegetable, and
specialty crop marketing agreements and orders may be viewed at: https://www.ams.usda.gov/rules-regulations/moa/small-businesses. Any questions
about the compliance guide should be sent to Richard Lower at the
previously mentioned address in the FOR FURTHER INFORMATION CONTACT
section.
After consideration of all relevant material presented, including
the information and recommendation submitted by the Board 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 fiscal
year ends on September 30, 2017, and the change in allotment of
assessments collected is necessary to ensure sufficient funds are
available to cover the increase in research and promotion expenses that
were incurred to help market the 2016-17 above-average crop. 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 and no negative comments were received.
List of Subjects in 7 CFR Part 930
Marketing agreements, Reporting and recordkeeping requirements,
Tart cherries.
For the reasons set forth in the preamble, 7 CFR part 930 is
amended as follows:
PART 930--TART CHERRIES GROWN IN THE STATES OF MICHIGAN, NEW YORK,
PENNSYLVANIA, OREGON, UTAH, WASHINGTON, AND WISCONSIN
0
1. The authority citation for 7 CFR part 930 continues to read as
follows:
Authority: 7 U.S.C. 601-674.
0
2. Section 930.200 is revised to read as follows:
Sec. 930.200 Assessment rate.
On and after October 1, 2016, the assessment rate imposed on
handlers shall be $0.0075 per pound of tart cherries grown in the
production area and utilized in the production of tart cherry products.
Included in this rate is $0.0065 per pound of tart cherries to cover
the cost of the research and promotion program and $0.001 per pound of
tart cherries to cover administrative expenses.
Dated: August 30, 2017.
Bruce Summers,
Acting Administrator, Agricultural Marketing Service.
[FR Doc. 2017-18756 Filed 9-1-17; 8:45 am]
BILLING CODE 3410-02-P
