Rule2022-08009
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
April 14, 2022
Effective
May 16, 2022
Issuing agencies
Agriculture DepartmentAgricultural Marketing Service
Abstract
This rule implements a recommendation from the Administrative Committee for Pistachios (Committee) to increase the assessment rate established for the 2021-22 and subsequent production years. The assessment rate will remain in effect indefinitely unless modified, suspended, or terminated.
Full Text
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<title>Federal Register, Volume 87 Issue 72 (Thursday, April 14, 2022)</title>
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[Federal Register Volume 87, Number 72 (Thursday, April 14, 2022)]
[Rules and Regulations]
[Pages 22105-22108]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2022-08009]
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DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 983
[Doc. No. AMS-SC-21-0068; SC21-983-1 FR]
Increased Assessment Rate for Pistachios
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Final rule.
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SUMMARY: This rule implements a recommendation from the Administrative
Committee for Pistachios (Committee) to increase the assessment rate
established for the 2021-22 and subsequent production years. The
assessment rate will remain in effect indefinitely unless modified,
suspended, or terminated.
DATES: Effective May 16, 2022.
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#7d2d1809180f2f532e121010180f0e3d080e191c531a120b"><span class="__cf_email__" data-cfemail="f1a194859483a3dfa29e9c9c948382b184829590df969e87">[email protected]</span></a> or <a href="/cdn-cgi/l/email-protection#eaad8b9893aec4a586998584aa9f998e8bc48d859c"><span class="__cf_email__" data-cfemail="d097b1a2a994fe9fbca3bfbe90a5a3b4b1feb7bfa6">[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#f9ab909a91988b9dd7b5968e9c8bb98c8a9d98d79e968f"><span class="__cf_email__" data-cfemail="b3e1dad0dbd2c1d79dffdcc4d6c1f3c6c0d7d29dd4dcc5">[email protected]</span></a>.
SUPPLEMENTARY INFORMATION: This action, pursuant to 5 U.S.C. 553,
amends regulations issued to carry out a marketing order as defined in
7 CFR 900.2(j). This 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 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.
[[Page 22106]]
This 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. Agricultural Marketing Service (AMS) has
determined this 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 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. The assessment rate established herein is applicable
to all assessable pistachios for the 2021-22 and subsequent production
years and will continue until amended, suspended, or terminated. The
production year runs from September 1 to August 31. This 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 rule increases the assessment rate from $0.00015 per pound of
pistachios, the rate established for the 2020-21 and subsequent
production years, to $0.0007 per pound of pistachios for the 2021-22
and subsequent production years.
The Order authorizes the Committee, with the approval of AMS, 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 persons have an opportunity
to participate and provide input.
For the 2020-21 and subsequent production years, the Committee
recommended, and AMS approved, an assessment rate of $0.00015 per pound
of pistachios. That assessment rate continued in effect from production
year to production year until modified, suspended, or terminated by AMS
upon recommendation and information submitted by the Committee or other
information available to AMS.
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 the 2021-22 and subsequent production years. In
comparison, the prior year's budgeted expenditures were $679,800. The
assessment rate of $0.0007 is $0.00055 higher than the rate previously
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 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), will 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 established by this rule will continue in
effect indefinitely unless modified, suspended, or terminated by AMS
upon recommendation and information submitted by the Committee or other
available information.
Although this assessment rate will 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 AMS.
Committee meetings are open to the public and interested persons may
express their views at these meetings. AMS 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, will be reviewed
and, as appropriate, approved by AMS.
Final Regulatory Flexibility Analysis
Pursuant to requirements set forth in the Regulatory Flexibility
Act (RFA) (5 U.S.C. 601-612), the 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 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 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
[[Page 22107]]
(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 AMS 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 the 25-
pound 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 assessment rate of $0.0007 that the Committee recommended
complies with Sec. 983.71(b) of the Order which states that any
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 assessment rate of $0.0007.
This rule increases the assessment rate collected from handlers for
the 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 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, will 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 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 will 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 the additional staff salaries would be required to
assist the management transition. However, the Committee determined
that the recommended assessment rate will 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 rule increases the assessment obligation imposed on handlers.
Assessments are applied uniformly on all handlers, and some of the
costs may be passed on to producers. However, these costs are offset by
the 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 were invited to submit
comments on this 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. 0581-0215, Pistachios
Grown in California, Arizona, and New Mexico. No changes in those
requirements are necessary as a result of this rule. 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 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.
AMS has not identified any relevant Federal rules that duplicate,
overlap, or conflict with this rule.
A proposed rule concerning this action was published in the Federal
Register on December 6, 2021 (86 FR 68932). Copies of the proposal were
provided by the Committee to members and handlers. Finally, the
proposed rule was made available through the internet by AMS and the
Federal Register. A 30-day comment period ending January 5, 2022, was
provided to allow interested persons to respond to the proposal.
No comments were received. Accordingly, no changes were made to the
rule as proposed.
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.
After consideration of all relevant material presented, including
the information and recommendation submitted by the Committee and other
available information, it is hereby found that this rule will tend to
effectuate the declared policy of the Act.
List of Subjects in 7 CFR Part 983
Marketing agreements, Nuts, Reporting and recordkeeping
requirements.
For the reasons set forth in the preamble, the Agricultural
Marketing Service is amending 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.
[[Page 22108]]
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. 2022-08009 Filed 4-13-22; 8:45 am]
BILLING CODE P
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