80 FR 16590 - Olives Grown in California; Increased Assessment Rate

DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service

Federal Register Volume 80, Issue 60 (March 30, 2015)

This proposed rule would implement a recommendation from the California Olive Committee (committee) to increase the assessment rate established for the 2015 and subsequent fiscal years from $15.21 to $26.00 per assessable ton of olives handled. The committee locally administers the marketing order and is comprised of producers and handlers of olives grown in California. Assessments upon olive handlers are used by the committee to fund reasonable and necessary expenses of the program. The fiscal year begins January 1 and ends December 31. The assessment rate would remain in effect indefinitely unless modified, suspended, or terminated.

[Federal Register Volume 80, Number 60 (Monday, March 30, 2015)]
[Proposed Rules]
[Pages 16590-16592]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2015-07116]


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Proposed Rules
                                                Federal Register
________________________________________________________________________

This section of the FEDERAL REGISTER contains notices to the public of 
the proposed issuance of rules and regulations. The purpose of these 
notices is to give interested persons an opportunity to participate in 
the rule making prior to the adoption of the final rules.

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Federal Register / Vol. 80, No. 60 / Monday, March 30, 2015 / 
Proposed Rules

[[Page 16590]]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 932

[Doc. No. AMS-FV-14-0105; FV15-932-1 PR]


Olives Grown in California; Increased Assessment Rate

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule.

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SUMMARY: This proposed rule would implement a recommendation from the 
California Olive Committee (committee) to increase the assessment rate 
established for the 2015 and subsequent fiscal years from $15.21 to 
$26.00 per assessable ton of olives handled. The committee locally 
administers the marketing order and is comprised of producers and 
handlers of olives grown in California. Assessments upon olive handlers 
are used by the committee to fund reasonable and necessary expenses of 
the program. The fiscal year begins January 1 and ends December 31. The 
assessment rate would remain in effect indefinitely unless modified, 
suspended, or terminated.

DATES: Comments must be received by April 29, 2015.

ADDRESSES: Interested persons are invited to submit written comments 
concerning this proposed rule. Comments must be sent to the Docket 
Clerk, Marketing Order and Agreement Division, Fruit and Vegetable 
Program, AMS, USDA, 1400 Independence Avenue SW., STOP 0237, 
Washington, DC 20250-0237; Fax: (202) 720-8938; or Internet: http://www.regulations.gov. Comments should reference the document number and 
the date and page number of this issue of the Federal Register and will 
be available for public inspection in the Office of the Docket Clerk 
during regular business hours, or can be viewed at: http://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. Please be advised that the identity of the individuals 
or entities submitting the comments will be made public on the internet 
at the address provided above.

FOR FURTHER INFORMATION CONTACT: Terry Vawter, Senior Marketing 
Specialist or Martin Engeler, Regional Manager, California Marketing 
Field Office, Marketing Order and Agreement Division, Fruit and 
Vegetable Program, AMS, USDA; Telephone: (559) 487-5901, Fax: (559) 
487-5906, or Email: [email protected] or 
[email protected].
    Small businesses may request information on complying with this 
regulation by contacting Jeffrey Smutny, Marketing Order and Agreement 
Division, Fruit and Vegetable Program, AMS, USDA, 1400 Independence 
Avenue SW., STOP 0237, Washington, DC 20250-0237; Telephone: (202) 720-
2491, Fax: (202)720-8938, or Email: [email protected].

SUPPLEMENTARY INFORMATION: This proposed rule is issued under Marketing 
Agreement No. 148 and Order No. 932, both as amended (7 CFR part 932), 
regulating the handling of olives grown in California, 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 proposed rule 
in conformance with Executive Orders 12866, 13563, and 13175.
    This proposed rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. Under the marketing order now in effect, 
California olive handlers are subject to assessments. Funds to 
administer the order are derived from such assessments. It is intended 
that the assessment rate increase proposed herein would be applicable 
to all assessable olives beginning on January 1, 2015, 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 proposed rule would increase the assessment rate established 
for the committee for the 2015 and subsequent fiscal years from $15.21 
to $26.00 per ton of assessable olives.
    The California olive marketing order provides authority for the 
committee, 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 committee are producers and handlers of 
California olives. They are familiar with the committee's needs and 
with the costs for goods and services in their local area and are thus 
in a position to formulate an appropriate budget and assessment rate.
    The assessment rate is formulated and discussed in a public 
meeting. Thus, all directly affected persons have an opportunity to 
participate and provide input.
    For the 2014 and subsequent fiscal years, the committee 
recommended, and USDA approved, an assessment rate that would continue 
in effect from fiscal year to fiscal year unless modified, suspended, 
or terminated by USDA upon recommendation and information submitted by 
the committee or other information available to USDA.
    The committee met on December 9, 2014, and unanimously recommended 
2015 fiscal year expenditures of $1,374,072, and an assessment rate of 
$26.00 per ton of assessable olives. Olives are an alternate-bearing 
crop: a large crop followed by a smaller crop. Olive growers and 
handlers are accustomed to wide swings in crop yields, which 
necessarily result in fluctuations in the assessment rate from year to 
year. In comparison, last year's budgeted expenditures were $1,262,460.

[[Page 16591]]

The assessment rate of $26.00 is $10.79 higher than the rate currently 
in effect.
    The committee recommended the higher assessment rate because of a 
substantial decrease in assessable olive tonnage for the 2014 crop 
year. The olive tonnage available for the 2014 crop year was less than 
40,000 tons, which compares to the 91,000 tons reported for the 2013 
crop year, as reported by the California Agricultural Statistics 
Service (CASS).
    The reduced crop is due to olives being an alternate-bearing fruit. 
The 2014 crop was what is called the ``off'' crop: The smaller of the 
two bearing-year crops.
    In addition to the funds from handler assessments, the committee 
also plans to use available reserve funds to help meet its 2015 fiscal 
year expenses.
    The major expenditures recommended by the committee for the 2015 
fiscal year include $259,231 for research, $450,000 for marketing 
activities, $122,000 for inspection equipment and electronic reporting 
development, and $393,500 for administration. The major expenditures 
for the 2014 fiscal year included $312,560 for research, $565,600 for 
marketing activities, $37,800 for inspection equipment and electronic 
reporting development, and $346,500 for administration.
    Overall 2015 expenditures include an increase in inspection 
equipment and electronic reporting development expenses due to the need 
to purchase, test, install, and link new sizers to the electronic 
reporting system. Additionally, the research budget contains a 
contingency of $41,000 for new opportunities that may arise during the 
fiscal year, and the administrative budget includes a $31,000 
contingency for unforeseen issues.
    The assessment rate recommended by the committee resulted from 
consideration of anticipated fiscal year expenses, actual olive tonnage 
received by handlers during the 2014 crop year, and additional 
pertinent information. As reported by CASS, actual assessable tonnage 
for the 2014 crop year is under 40,000 tons or less than half of the 
91,000 assessable tons in the 2013 crop year, which is a result of the 
alternate-bearing characteristics of olives.
    Income derived from handler assessments, along with interest income 
and funds from the committee's authorized reserve would be adequate to 
cover budgeted expenses. Funds in the reserve would be kept within the 
maximum permitted by the order of approximately one fiscal year's 
expenses (Sec.  932.40).
    The proposed assessment rate would continue in effect indefinitely 
unless modified, suspended, or terminated by USDA upon recommendation 
and information submitted by the committee or other available 
information.
    Although this assessment rate would be in effect for an indefinite 
period, the committee would continue to meet prior to or during each 
fiscal year to recommend a budget of expenses and consider 
recommendations for modification of the assessment rate. The dates and 
times of committee meetings are available from the committee or USDA. 
Committee meetings are open to the public and interested persons may 
express their views at these meetings. USDA would evaluate committee 
recommendations and other available information to determine whether 
modification of the assessment rate is needed. Further rulemaking would 
be undertaken as necessary. The committee's 2015 fiscal year budget and 
those for subsequent fiscal years would be reviewed and, as 
appropriate, approved by USDA.

Initial 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 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 in order that small businesses will 
not be unduly or disproportionately burdened. Marketing orders issued 
pursuant to the Act, and the rules issued thereunder, are unique in 
that they are brought about through group action of essentially small 
entities acting on their own behalf.
    There are approximately 1000 producers of olives in the production 
area and 2 handlers subject to regulation under the marketing order. 
The Small Business Administration (13 CFR 121.201) defines small 
agricultural producers as those having annual receipts of less than 
$750,000, and small agricultural service firms as those whose annual 
receipts are less than $7,000,000 (13 CFR 121.210).
    Based upon information from the industry and CASS, the average 
grower price for the 2014 crop year was approximately $1,027 per ton, 
and total assessable volume was less than 40,000 tons. Based on 
production, producer prices, and the total number of California olive 
producers, the average annual producer revenue is less than $750,000. 
Thus, the majority of olive producers may be classified as small 
entities. Both of the handlers may be classified as large entities.
    This proposed rule would increase the assessment rate established 
for the committee and collected from handlers for the 2015 and 
subsequent fiscal years from $15.21 to $26.00 per ton of assessable 
olives. The committee unanimously recommended 2015 fiscal year 
expenditures of $1,374,072, and an assessment rate of $26.00 per ton. 
The higher assessment rate is necessary because assessable olive 
receipts for the 2014 crop year were reported by CASS to be less than 
40,000 tons, compared to 91,000 tons for the 2013 crop year.
    Income derived from the $26.00 per ton assessment rate, along with 
funds from the authorized reserve and interest income, should be 
adequate to meet this fiscal year's expenses.
    The major expenditures recommended by the committee for the 2015 
fiscal year include $259,231 for research, $450,000 for marketing 
activities, $122,000 for inspection equipment development, and $393,500 
for administration. Budgeted expenses for these items in 2014 were 
$312,560 for research, $565,600 for marketing activities, $37,800 for 
inspection equipment and electronic reporting development, and $346,500 
for administration.
    The committee deliberated many of the expenses, weighing the 
relative value of various programs or projects, and decreased their 
costs for research and marketing, while increasing their costs for 
inspection equipment and electronic reporting development, as well as 
their administrative expenses.
    Prior to arriving at this budget, the committee considered 
information from various sources such as the committee's Executive, 
Marketing, Inspection, and Research Subcommittees. Alternate 
expenditure levels were discussed by these groups based upon the 
relative value of various projects to the olive industry and the 
reduced olive production. The assessment rate of $26.00 per ton of 
assessable olives was derived by considering anticipated expenses, the 
volume of assessable olives, and additional pertinent factors.
    A review of preliminary information indicates that average grower 
prices for 2014 crop olives was approximately $1,027 per ton. 
Therefore, utilizing the proposed assessment rate of $26.00 per ton, 
the estimated assessment revenue for the 2015 fiscal year as a 
percentage of total grower revenue would be approximately 2.5 percent.
    This action would increase the assessment obligation imposed on

[[Page 16592]]

handlers. While assessments impose some additional costs on handlers, 
the costs are minimal and uniform on all handlers. Some of the 
additional costs may be passed on to producers. However, these costs 
would be offset by the benefits derived from the operation of the 
marketing order. In addition, the committee's meeting was widely 
publicized throughout the California's olive industry and all 
interested persons were invited to attend the meeting and participate 
in committee deliberations on all issues. Like all committee meetings, 
the December 9, 2014, meeting was a public meeting and all entities, 
both large and small, were encouraged to express views on this issue. 
Finally, interested persons are invited to submit comments on this 
proposed rule including the regulatory and informational impacts of 
this action on small businesses.
    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 the Office of Management and Budget (OMB) and 
assigned OMB No. 0581-0178. No changes in those requirements as a 
result of this action are necessary. Should any changes become 
necessary, they would be submitted to OMB for approval.
    This proposed rule would impose no additional reporting or 
recordkeeping requirements on either small or large California olive 
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.
    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.
    USDA has not identified any relevant Federal rules that duplicate, 
overlap, or conflict with this action.
    A small business guide on complying with fruit, vegetable, and 
specialty crop marketing agreements and orders may be viewed at: http://www.ams.usda.gov/MarketingOrdersSmallBusinessGuide. Any questions 
about the compliance guide should be sent to Jeffrey Smutny at the 
previously-mentioned address in the FOR FURTHER INFORMATION CONTACT 
section.
    A 30-day comment period is provided to allow interested persons to 
respond to this proposed rule. Thirty days is deemed appropriate 
because: (1) The 2015 fiscal year began on January 1, 2015, and the 
marketing order requires that the rate of assessment for each fiscal 
year apply to all assessable olives handled during such fiscal year; 
(2) the committee needs to have sufficient funds to pay its expenses, 
which are incurred on a continuous basis; and (3) both regulated 
handlers were present at the December 9, 2014, meeting, and are aware 
of this action, which was unanimously recommended by the committee at a 
public meeting, and is similar to other assessment rate actions issued 
in past years.

List of Subjects in 7 CFR Part 932

    Olives, Marketing agreements, Reporting and recordkeeping 
requirements.
    For the reasons set forth in the preamble, 7 CFR part 932 is 
proposed to be amended as follows:

PART 932--OLIVES GROWN IN CALIFORNIA

0
1. The authority citation for 7 CFR part 932 continues to read as 
follows:

    Authority: 7 U.S.C. 601-674.
0
2. Section 932.230 is revised to read as follows:


Sec.  932.230  Assessment rate.

    On and after January 1, 2015, an assessment rate of $26.00 per ton 
is established for California olives.

    Dated: March 24, 2015.
Rex A. Barnes,
Associate Administrator, Agricultural Marketing Service.
[FR Doc. 2015-07116 Filed 3-27-15; 8:45 am]
 BILLING CODE 3410-02-P