Washington Apricots; Termination of Marketing Order, 63433-63436 [2022-22695]

Agencies

• Agricultural Marketing Service
• DEPARTMENT OF AGRICULTURE

[Federal Register Volume 87, Number 201 (Wednesday, October 19, 2022)]
[Proposed Rules]
[Pages 63433-63436]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-22695]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 922

[Doc. No. AMS-SC-21-0061]


Washington Apricots; Termination of Marketing Order

AGENCY: Agricultural Marketing Service, Department of Agriculture 
(USDA).

ACTION: Proposed rule.

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SUMMARY: This proposed rule invites comments on a recommendation from 
the Washington Apricot Marketing Committee (Committee) to terminate the 
Federal marketing order regulating the handling of apricots grown in 
designated counties in Washington (Marketing Order No. 922). The 
Committee determined the marketing order is no longer necessary to 
maintain orderly marketing conditions and unanimously recommended its 
termination. Following the Committee's recommendation, the Agricultural 
Marketing Service (AMS) suspended the remaining reporting and 
assessment collection requirements under the marketing order while it 
considered termination of the marketing order. After reviewing the 
Committee's recommendation and other information submitted, AMS 
determined that the marketing order no longer tends to effectuate the 
declared policy of the Agricultural Marketing Agreement Act of 1937. If 
implemented, this proposed rule would remove Marketing Order No. 922 
from the Code of Federal Regulations.

DATES: Comments must be received by December 19, 2022.

ADDRESSES: Interested persons are invited to submit written comments 
concerning this proposed rule. Comments must be sent to the Docket 
Clerk, Market Development Division, Specialty Crops Program, AMS, USDA, 
1400 Independence Avenue SW, STOP 0237, Washington, DC 20250-0237; Fax: 
(202) 720-8938; or via internet at: https://www.regulations.gov. 
Comments should reference the document number and the date and page 
number of this issue of the Federal Register. All comments will be made 
available for public inspection in the Office of the Docket Clerk 
during regular business hours, or can be viewed at: https://www.regulations.gov. All comments submitted in response to this 
proposed rule will be included in the record and will be made available 
to the public on the internet at the address provided above. Please be 
advised that the

[[Page 63434]]

identity of individuals or entities submitting comments will be made 
public.

FOR FURTHER INFORMATION CONTACT: Joshua R. Wilde, Marketing Specialist, 
or Gary Olson, Regional Director, Western Region Branch, Market 
Development Division, Specialty Crops Program, AMS, USDA; Telephone: 
(503) 326-2724 or Email: [email protected] or 
[email protected].
    Small businesses may request information on complying with this 
regulation by contacting Richard Lower, Market Development Division, 
Specialty Crops Program, AMS, USDA, 1400 Independence Avenue SW, STOP 
0237, Washington, DC 20250-0237; Telephone: (202) 720-2491 or Email: 
[email protected].

SUPPLEMENTARY INFORMATION: This action, pursuant to 5 U.S.C. 553, 
proposes an amendment to regulations issued to carry out a marketing 
order as defined in 7 CFR 900.2(j). This proposed rule is issued under 
Marketing Order No. 922, as amended (7 CFR part 922), regulating the 
handling of apricots grown in designated counties in Washington. Part 
922 (referred to as 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 Committee locally 
administers the Order and is comprised of producers and handlers 
operating within the production area.
    AMS is issuing this proposed rule in conformance with Executive 
Orders 12866 and 13563. Executive Orders 12866 and 13563 direct 
agencies to assess all costs and benefits of available regulatory 
alternatives and, if regulation is necessary, to select regulatory 
approaches that maximize net benefits (including potential economic, 
environmental, public health and safety effects, distributive impacts, 
and equity). Executive Order 13563 emphasizes the importance of 
quantifying both costs and benefits, reducing costs, harmonizing rules, 
and promoting flexibility. This action falls within a category of 
regulatory actions that the Office of Management and Budget (OMB) 
exempted from Executive Order 12866 review.
    In addition, this proposed rule has been reviewed under Executive 
Order 13175--Consultation and Coordination with Indian Tribal 
Governments, which requires agencies to consider whether their 
rulemaking actions would have tribal implications. AMS has determined 
this proposed rule is unlikely to have substantial direct effects on 
one or more Indian tribes, on the relationship between the Federal 
Government and Indian tribes, or on the distribution of power and 
responsibilities between the Federal Government and Indian tribes.
    This proposed rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. This proposed rule is not intended to have 
retroactive effect.
    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 a marketing order may file with the 
Department of Agriculture (USDA) a petition stating that the marketing 
order, any provision of the marketing order, or any obligation imposed 
in connection with the marketing order is not in accordance with law 
and request a modification of the marketing order or to be exempted 
therefrom. A 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 proposed rule would terminate the Order regulating the 
handling of apricots grown in designated counties in Washington. 
Following its meeting on May 11, 2021, the Washington Apricot Marketing 
Committee (Committee) unanimously recommended this action after 
determining the Order is no longer necessary to maintain orderly 
marketing conditions. AMS suspended, indefinitely, reporting and 
assessment collection requirements under the Order while it considered 
the Committee's recommendation and information submitted (87 FR 21741). 
After reviewing the Committee's recommendation, years without marketing 
program activity, the decline in apricot production, and the decision 
to indefinitely suspend reporting and assessment collection 
requirements, AMS determined that the Order no longer tends to 
effectuate the declared policy of the Act. This proposed rule invites 
comments on proposed termination of the Order and, if implemented, 
would remove the Order from the Code of Federal Regulations.
    Section 922.64(b) of the Order provides that United States 
Secretary of Agriculture (Secretary) may terminate or suspend any or 
all provisions of the Order when a finding is made that the Order does 
not tend to effectuate the declared policy of the Act. In addition, 
section 608c(16)(A) of the Act provides that the Secretary terminate or 
suspend the operation of any order whenever the order or any provision 
thereof obstructs or does not tend to effectuate the declared policy of 
the Act.
    The Order has been in effect since 1957 and has provided the 
apricot industry in Washington with authority for grade, size, quality, 
maturity, pack, and container regulations, as well as authority for 
mandatory product inspection.
    The Committee, which locally administers the Order, meets regularly 
to consider recommendations for modification, suspension, or 
termination of the Order's regulatory requirements. Committee meetings 
are open to the public and interested persons may express their views 
at these meetings. AMS reviews Committee recommendations, including 
information provided by the Committee and from other available sources, 
and determines whether modification, suspension, or termination would 
tend to effectuate the declared policy of the Act.
    In 2006, the Committee unanimously recommended AMS suspend 
container regulations after determining they were no longer necessary 
to ensure orderly marketing and that suspension would provide greater 
flexibility to handlers for packing and shipping apricots. Following 
the Committee's recommendation, AMS suspended container regulations for 
apricots for one year in 2006 (71 FR 16979), and subsequently extended 
that suspension indefinitely in 2007 (72 FR 16263).
    In 2013, the Committee unanimously recommended AMS suspend handling 
regulations after determining the cost of complying with the Order's 
handling and inspection requirements outweighed its benefits to both 
producers and handlers of apricots. Based on the Committee's 
recommendation, AMS issued an interim rule suspending the handling 
regulations for apricots on October 23, 2013 (78 FR 62963). A final 
rule affirming the indefinite suspension published in the Federal 
Register on March 20, 2014 (79 FR 15539).
    Following these regulatory suspensions, the Committee continued to 
levy assessments to maintain its functionality. The Committee believed 
that it should continue to fund its full operational capability, 
collect industry statistics on an ongoing basis, and maintain the 
program in the event market conditions warranted regulation.
    On May 11, 2021, the Committee met and discussed current market 
dynamics, budget and assessments, and deliberated

[[Page 63435]]

the continuance of the Order. During the meeting, the Committee 
discussed that the volume of apricots produced in Washington has 
declined over the years, and in 2020, the industry experienced a 
significant drop in crop produced from the prior year's production. In 
addition, management and administrative costs to maintain the Order 
have also increased. Staff management hours includes a greater quantity 
of hours worked than in previous years.
    The Committee discussed the alternative, that to maintain the Order 
would require an assessment rate increase of approximately over 300 
percent, from $2.86 to $13.30 per ton. However, the Committee 
determined that the decrease in the 2020 crop suggests an overall 
decline in apricot production, and an assessment rate increase of over 
300 percent would not benefit apricot producers and handlers. The 
Committee discussed that the industry has functioned without container 
and handling regulations for a combined period of more than 14 years. 
It was the belief of the Committee that the suspension of container and 
handling requirements had not adversely affected the marketing of 
Washington apricots and, therefore, terminating the Order would not 
negatively impact the industry. The Committee concluded that the Order 
is no longer necessary to maintain orderly marketing conditions and 
that the cost to maintain the Order outweighs its benefit to industry. 
Following this meeting, the Committee voted unanimously to terminate 
the Order.
    On July 7, 2021, the Committee formally recommended AMS terminate 
the Order. In preparing to terminate the Order, the Committee 
recommended AMS suspend the collection of assessments and reporting 
requirements. The Committee also recommended a budget of expenditures 
of $5,508 for the period beginning April 1, 2021, and ending with the 
termination of the Order. Following the Committee's recommendation, AMS 
suspended, indefinitely, the remaining reporting and assessment 
collection requirements under the Order while it considered the 
recommendation and information submitted by the Committee to terminate 
the Order. A proposed rule to suspend reporting and assessment 
collection requirements published in the Federal Register on November 
23, 2021 (86 FR 66462). AMS received one comment that did not address 
the merits of the rule. Accordingly, no changes were made to the rule 
as proposed and the final rule published on April 13, 2022 (87 FR 
21741). The suspension of regulations, reporting requirements, and 
assessment collections continued while AMS evaluated the Committee's 
recommendation for terminating the Order. After reviewing the 
Committee's recommendation, years without marketing program activity, 
the decline in apricot production, and the decision to indefinitely 
suspend reporting and assessment collection requirements, AMS 
determined that the Order no longer tends to effectuate the declared 
policy of the Act.
    This proposed rule is intended to solicit input and any additional 
information available from interested parties regarding whether the 
Order should be terminated. AMS will evaluate all available information 
prior to making a final determination on this matter. If implemented, 
this proposed rule would terminate the Order and the rules and 
regulations issued thereunder.

Initial Regulatory Flexibility Analysis

    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA) (5 U.S.C. 601-612), AMS has considered the economic impact of 
this proposed rule 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 
businesses subject to such actions so that small businesses will not be 
unduly or disproportionately burdened. Marketing orders issued pursuant 
to the Act are unique in that they are brought about through group 
action of essentially small entities acting on their own behalf.
    There are approximately 315 growers of Washington apricots and 
approximately 8 apricot handlers in the production area subject to 
regulation under the Order. Small agricultural service firms 
(postharvest crop activities (except cotton ginning), NAICS code 
115114) are defined by the Small Business Administration (SBA) as those 
having annual receipts of $30,000,000 or less, and small agricultural 
producers (other non-citrus fruit farming, NAICS code 111339) are 
defined as those having annual receipts of $3,000,000 or less (13 CFR 
121.201).
    Based on USDA National Agricultural Statistics Service (NASS) data, 
and given the number of Washington apricot growers, average grower 
revenue is well below $3,000,000. NASS's 2020 value of utilized 
Washington apricot crop production was $3.866 million. Dividing the 
$3.866 million crop value by 315 growers equals average annual receipts 
per grower of $12,273. Thus, most Washington apricot growers would be 
considered small businesses under the SBA definition.
    In addition, according to data from AMS's Market News, the 
estimated Washington apricot 2020 season average Free on Board (f.o.b.) 
shipper (handler) price per carton was approximately $31.59 (for 
Washington apricots, 2-layer tray pack carton, all sizes, June-July 
2020, midpoint of the ``mostly low'' and ``mostly high'' prices). With 
a standard Market News weight of 18 pounds per tray pack carton of 
apricots, the f.o.b. price was approximately $1.755 per pound, ($31.59 
divided by 18 pounds), or $3,510 per ton. The Committee reported that 
the industry shipped 1,628 tons for the 2020 season. Total 2020 
estimated handler receipts are $5.714 million (1,628 tons times $3,510 
per ton). Average annual receipts per handler are approximately 
$714,000 ($5.714 million divided by 8 handlers). Thus, most Washington 
apricot handlers would be considered small businesses under the SBA 
definition.
    This rule proposes to terminate the Order, and the rules and 
regulations issued thereunder. Termination would remove the Order from 
the Code of Federal Regulations.
    On July 7, 2021, the Committee made the recommendation to terminate 
the Order. The alternative, to maintain the Order, would require the 
Committee to increase the assessment rate by approximately 300%, from 
$2.86 to $13.30 per ton. However, the 2020-2021 crop production was the 
smallest crop on record, and evidence suggests that this decline is a 
continuation of an industry trend.
    In addition, the prior suspension of the container and handling 
regulations, effectuated by a separate rulemaking published on April 5, 
2006 (71 FR 16979), has not adversely affected the marketing of 
Washington apricots in any of the subsequent years. AMS confirmed data 
from the past 7 years shows that apricots can be marketed from the 
production area in the absence of the Order's requirements without a 
negative economic impact on the industry.
    After considering the alternative, the Committee concluded that 
regulating the handling of apricots under the Order is no longer 
necessary to ensure orderly marketing of Washington apricots, that the 
costs associated with the administration of the Order outweigh the 
benefits, and that termination of the Order would not have a negative 
impact on industry. Therefore, following its meeting on May 11, 2021, 
the Committee unanimously voted to terminate the Order. The suspension 
of regulations, reporting requirements, and assessments collections 
continued for an indefinite period while USDA evaluated the Committee's

[[Page 63436]]

recommendation to proceed with the termination of the Order.
    This proposed rule is intended to solicit input and other available 
information from interested parties on whether the Order should be 
terminated. AMS will evaluate all available information prior to making 
a final determination on this matter.
    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. 0581-0189 Fruit Crops. 
AMS will extract the remaining apricot marketing order-related forms 
from the forms package during the next three-year renewal process, 
should the Order be terminated.
    This rule would effectuate the removal of reporting and 
recordkeeping requirements on apricot handlers, both small and large. 
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. In addition, AMS 
has not identified any relevant Federal rules that duplicate, overlap 
or conflict with this proposed 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.
    The Committee's meetings were widely publicized throughout the 
Washington apricot industry, and all interested persons were invited to 
attend the meetings and participate in Committee deliberations on all 
issues. Meetings were held virtually or in a hybrid style with 
participants having a choice on whether to attend in person or 
virtually.
    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.
    This rule invites comments on the proposed termination of Marketing 
Order No. 922, which regulates the handling of apricots grown in 
designated counties in Washington. A 60-day comment period is provided 
to allow interested persons to respond to this proposal. All written 
comments timely received will be considered before a final 
determination is made on this matter.
    Based on the foregoing, and pursuant to Sec.  608c(16)(A) of the 
Act and Sec.  922.64 of the Order, AMS is considering termination of 
the Order. If AMS decides to terminate the Order, trustees would be 
appointed to conclude and liquidate the Committee affairs and would 
continue in that capacity until discharged by AMS. In addition, AMS 
would notify Congress 60 days in advance of termination pursuant to 
Sec.  608c(16)(A) of the Act.

List of Subjects in 7 CFR Part 922

    Apricots, Marketing agreements, Reporting and recordkeeping 
requirements.

PART 922--[REMOVED]

    For the reasons set forth in the preamble, and under the authority 
of 7 U.S.C. 601-674, the Agricultural Marketing Service proposes to 
remove part 922.

Erin Morris,
Associate Administrator, Agricultural Marketing Service.
[FR Doc. 2022-22695 Filed 10-18-22; 8:45 am]
BILLING CODE P