Proposed Rule2021-26256
Increased Assessment Rate for Pistachios
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
December 6, 2021
Issuing agencies
Agriculture DepartmentAgricultural Marketing Service
Abstract
This proposed rule would implement a recommendation from the Administrative Committee for Pistachios (Committee) to increase the assessment rate established for 2021-22 and subsequent production years. The proposed assessment rate would remain in effect indefinitely unless modified, suspended, or terminated.
Full Text
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<title>Federal Register, Volume 86 Issue 231 (Monday, December 6, 2021)</title>
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[Federal Register Volume 86, Number 231 (Monday, December 6, 2021)]
[Proposed Rules]
[Pages 68932-68934]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2021-26256]
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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. 86, No. 231 / Monday, December 6, 2021 /
Proposed Rules
[[Page 68932]]
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 983
[Doc. No. AMS-SC-21-0068; SC21-983-1 PR]
Increased Assessment Rate for Pistachios
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Proposed rule.
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SUMMARY: This proposed rule would implement a recommendation from the
Administrative Committee for Pistachios (Committee) to increase the
assessment rate established for 2021-22 and subsequent production
years. The proposed assessment rate would remain in effect indefinitely
unless modified, suspended, or terminated.
DATES: Comments must be received by January 5, 2022.
ADDRESSES: Interested persons are invited to submit written comments
concerning this proposed rule. Comments must be sent to the Docket
Clerk electronically by Email: <a href="/cdn-cgi/l/email-protection#450824372e20312c2b220a37212037062a2828202b3105303621246b222a33"><span class="__cf_email__" data-cfemail="4805293a232d3c21262f073a2c2d3a0b2725252d263c083d3b2c29662f273e">[email protected]</span></a> or
internet: <a href="http://www.regulations.gov">http://www.regulations.gov</a>. 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: <a href="https://www.regulations.gov">https://www.regulations.gov</a>. 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
individuals or entities submitting comments will be made public on the
internet at the address provided above.
FOR FURTHER INFORMATION CONTACT: Peter Sommers, Marketing Specialist,
or Gary Olson, Regional Director, West Region Branch, Market
Development Division, Specialty Crops Program, AMS, USDA; Telephone:
(503) 326-2724 or Email: <a href="/cdn-cgi/l/email-protection#277742534255750974484a4a425554675254434609404851"><span class="__cf_email__" data-cfemail="08586d7c6d7a5a265b6765656d7a7b487d7b6c69266f677e">[email protected]</span></a> or
<a href="/cdn-cgi/l/email-protection#357254474c711b7a59465a5b75404651541b525a43"><span class="__cf_email__" data-cfemail="f9be988b80bdd7b6958a9697b98c8a9d98d79e968f">[email protected]</span></a>.
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:
<a href="/cdn-cgi/l/email-protection#02506b616a6370662c4e6d75677042777166632c656d74"><span class="__cf_email__" data-cfemail="5e0c373d363f2c3a701231293b2c1e2b2d3a3f70393128">[email protected]</span></a>.
SUPPLEMENTARY INFORMATION: This action, pursuant to 5 U.S.C. 553,
proposes to amend regulations issued to carry out a marketing order as
defined in 7 CFR 900.2(j). This proposed rule is issued under Marketing
Agreement and Order No. 983, as amended (7 CFR part 983), regulating
the handling of pistachios grown in California, Arizona, and New
Mexico. Part 983 (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 of
pistachios operating within the production area, and a public member.
The Department of Agriculture (USDA) 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.
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. Under the Order now in effect, pistachio handlers
are subject to assessments. Funds to administer the Order are derived
from such assessments. It is intended that the assessment rate would be
applicable to all assessable pistachios for the 2021-22 production year
and continue until amended, suspended, or terminated. The production
year runs from September 1 to August 31. 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 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 no later than 20 days after the date of the
entry of the ruling.
This proposed rule would increase the assessment rate from $0.00015
per pound of pistachios, the rate established for 2020-21 and
subsequent production years, to $0.0007 per pound of pistachios for
2021-22 and subsequent production years.
The Order authorizes the Committee, with the approval of USDA, to
formulate an annual budget of expenses and collect assessments from
handlers to administer the program. Members are familiar with the
Committee's needs and with costs of goods and services in their local
area and are in a position to formulate an appropriate budget and
assessment rate. The assessment rate is formulated and discussed in a
public meeting, and all directly affected
[[Page 68933]]
persons have an opportunity to participate and provide input.
For 2020-21 and subsequent production years, the Committee
recommended, and USDA approved, an assessment rate of $0.00015 per
pound of pistachios. This assessment rate would continue to be in
effect from production year to production 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 July 20, 2021, and unanimously recommended
expenditures of $828,000 and an assessment rate of $0.0007 per pound of
pistachios handled for 2021-22 and subsequent production years. In
comparison, the prior year's budgeted expenditures were $679,800. The
proposed assessment rate of $0.0007 is $0.00055 higher than the rate
currently in effect. The Committee recommended increasing the
assessment rate to pay for additional Committee staff in preparation
for the retirement of key staff positions (manager and administrative
assistant) and to provide adequate income to cover all of the
Committee's budgeted expenses for the 2021-22 production year.
Major expenditures recommended by the Committee for the 2021-22
production year include $462,500 for personnel expenses, $125,000 for
research, $100,000 for a contingency fund, $82,700 for administration,
and $57,800 for office expenses. Budgeted expenses for these items in
the 2020-21 production year were $336,500, $125,000, $80,000, $80,700,
and $57,600, respectively.
The Committee derived the recommended assessment rate by
considering anticipated expenses, an estimated crop of 975,000 million
pounds of pistachios, and the amount of funds available in the
authorized reserve. Income derived from handler assessments, calculated
at $682,500 (975,000,000 pounds multiplied by $0.0007 assessment rate),
along with other income ($220,200), would be adequate to cover budgeted
expenses of $828,000. Excess assessment revenue would be added to the
Committee's reserve fund. Funds in the Committee's financial reserve
are expected to be approximately $385,157 at the end of the 2021-22
production year, which would be within the Order's requirement of no
more than approximately two production years' budgeted expenses.
The assessment rate proposed in this rulemaking 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 will continue to meet prior to or during each
production year to recommend a budget of expenses and consider
recommendations for modification of the assessment rate. 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 will evaluate Committee
recommendations and other available information to determine whether
modification of the assessment rate is needed. Further rulemaking will
be undertaken as necessary. The Committee's 2022-23 production year
budget, and those for subsequent production 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 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 19 handlers subject to regulation under the
Order, and approximately 1,624 producers of pistachios in the
production area. Small agricultural producers are defined by the Small
Business Administration (SBA) as those having annual receipts of less
than $1,000,000, and small agricultural service firms have been defined
as those whose annual receipts are less than $30,000,000 (13 CFR
121.201).
According to the National Agricultural Statistics Service (NASS),
the national average producer price for pistachios for the 2019-20
production year was $2.75 per pound. Committee data indicates 2019-20
production year total pistachio production was 582,111,271 pounds. The
total 2019-20 production year value of the pistachio crop was
calculated as $1,600,805,995 (582,111,271 pounds times $2.75 per pound
equals $1,600,805,995). Dividing the crop value by the estimated number
of producers (1,624) yields an estimated average receipt per producer
of $985,718, which is just below the SBA threshold for small producers.
According to USDA Market News data, the reported terminal price for
2021 for pistachios ranged between $150.00 to $250.00 per 25-pound
carton. The average of this range is $200.00 ($150.00 plus $250.00
divided by 2 equals $200.00). Dividing the average value by 25-pounds
per carton yields an estimated average price per pound of $8.00
($200.00 average value for 25-pound carton divided by 25). Multiplying
the 2019-20 production year total pistachio production of 582,111,271
pounds by the estimated average price per pound of $8.00 equals
$4,656,890,168. Dividing this figure by 19 regulated handlers yields
estimated average annual handler receipts of $245,099,483, which is
well above the SBA threshold for small agriculture service firms.
Therefore, using the above data, and assuming a normal
distribution, the majority of pistachio producers may be classified as
small entities and the majority of handlers of pistachios may be
classified as large entities.
The proposed assessment rate of $0.0007 that the Committee approved
complies with section 983.71(b) of the Order, which states that any
proposed assessment rate must not exceed one-half of one percent of the
average price received by producers in the preceding production year.
The average price received by producers in the preceding production
year was $2.75 per pound of pistachios. Thus, $2.75 times 0.5 percent
equals $0.01375, which is greater than the proposed assessment rate of
$0.0007.
This proposal would increase the assessment rate collected from
handlers for 2021-22 and subsequent production years from $0.00015 to
$0.0007 per pound of pistachios. The Committee unanimously recommended
2021-22 production year expenditures of $828,000 and an assessment rate
of $0.0007 per pound of pistachios handled. The proposed assessment
rate of $0.0007 per pound of pistachios is $0.00055 higher than the
current rate. The volume of assessable pistachios for the 2021-22
production year is estimated to be 975 million pounds. Thus, the
$0.0007 per pound assessment rate should provide $682,500 in assessment
income (975,000,000 multiplied by $0.0007). Income derived from handler
assessments, along with an estimated $220,000 of other income,
[[Page 68934]]
would be adequate to cover budgeted expenses for the 2021-22 production
year.
Major expenditures recommended by the Committee for the 2021-22
production year include $462,500 for personnel expenses, $125,000 for
research, $100,000 for a contingency fund, $82,700 for administration,
and $57,800 for office expenses. Budgeted expenses for these items in
the 2020-21 production year were $336,500, $125,000, $80,000, $80,700,
and $57,600, respectively.
The Committee recommended increasing the assessment rate due to
cover the Committee's budgeted expenses for the 2021-22 production year
and maintain its financial reserve. Additionally, the Committee has
approved a hiring search for both the Manager and Administrative
Assistant, as both are expected to retire in the near future. The
increased assessment income would accommodate the hiring of additional
staff to aid in the transition.
Prior to arriving at this budget and assessment rate
recommendation, the Committee discussed an alternative that considered
the timing of when additional staff salaries would be required to
assist the management transition. However, the Committee determined
that the recommended assessment rate would fully fund budgeted
expenses, avoid utilizing reserves, and permit the Committee to hire
the needed staff to facilitate the replacement of the key management
positions.
This proposed rule would increase the assessment obligation imposed
on handlers. Assessments are applied uniformly on all handlers, and a
portion of assessment costs may be passed on to producers. However,
these costs would be offset by benefits derived by the operation of the
Order.
The Committee's meeting was widely publicized throughout the
pistachio industry. All interested persons were invited to attend the
meeting and encouraged to participate in Committee deliberations on all
issues. Like all Committee meetings, the July 20, 2021, meeting was a
public meeting, and all entities, both large and small, were able to
express views on this issue. Interested persons are invited to submit
comments on this proposed rule, including regulatory and information
collection 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 OMB and assigned OMB No. 0581-0178, Vegetable
and Specialty Crops. No changes in those requirements would be
necessary as a result of this proposed rule. Should any changes become
necessary, they would be submitted to OMB for approval.
This proposed rule would not impose any additional reporting or
recordkeeping requirements on either small or large pistachio 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.
USDA has not identified any relevant Federal rules that duplicate,
overlap, or conflict with this proposed rule.
A small business guide on complying with fruit, vegetable, and
specialty crop marketing agreements and orders may be viewed at:
<a href="https://www.ams.usda.gov/rules-regulations/moa/small-businesses">https://www.ams.usda.gov/rules-regulations/moa/small-businesses</a>. Any
questions about the compliance guide should be sent to Richard Lower 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. All written comments timely received
will be considered before a final determination is made on this matter.
List of Subjects in 7 CFR Part 983
Marketing agreements, Pistachios, Reporting and recordkeeping
requirements.
For reasons set forth in the preamble, Agricultural Marketing
Service proposes to amend 7 CFR part 983 as follows:
PART 983--PISTACHIOS GROWN IN CALIFORNIA, ARIZONA, AND NEW MEXICO
0
1. The authority citation for 7 CFR part 983 continues to read as
follows:
Authority: 7 U.S.C. 601-674.
0
2. Section 983.253 is revised to read as follows:
Sec. 983.253 Assessment rate.
On and after September 1, 2021, an assessment rate of $0.0007 per
pound is established for California, Arizona, and New Mexico
pistachios.
Erin Morris,
Associate Administrator, Agricultural Marketing Service.
[FR Doc. 2021-26256 Filed 12-3-21; 8:45 am]
BILLING CODE 3410-02-P
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