Rule2023-22334
Raisins Produced From Grapes Grown in California; Temporary Suspension of Continuance Referendum
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Published
October 16, 2023
Effective
October 16, 2023
Issuing agencies
Agriculture DepartmentAgricultural Marketing Service
Abstract
This rule temporarily suspends the continuance referendum requirement under the Federal marketing order for California raisins. The continuance referendum scheduled between November 2023 and November 2025 overlaps with the timeframe the Agricultural Marketing Service (AMS) plans to conduct a formal rulemaking to amend the marketing order. This suspension delays the enforcement of the continuance referendum requirement to give precedence to the formal rulemaking process, which may include a producer referendum. In addition, if the marketing order is amended, this temporary suspension provides industry time to operate under the amended marketing order before the next scheduled continuance referendum.
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<title>Federal Register, Volume 88 Issue 198 (Monday, October 16, 2023)</title>
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[Federal Register Volume 88, Number 198 (Monday, October 16, 2023)]
[Rules and Regulations]
[Pages 71273-71275]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2023-22334]
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Rules and Regulations
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains regulatory documents
having general applicability and legal effect, most of which are keyed
to and codified in the Code of Federal Regulations, which is published
under 50 titles pursuant to 44 U.S.C. 1510.
The Code of Federal Regulations is sold by the Superintendent of Documents.
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Federal Register / Vol. 88 , No. 198 / Monday, October 16, 2023 /
Rules and Regulations
[[Page 71273]]
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 989
[Doc. No. AMS-SC-23-0007]
Raisins Produced From Grapes Grown in California; Temporary
Suspension of Continuance Referendum
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Interim final rule with request for comments.
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SUMMARY: This rule temporarily suspends the continuance referendum
requirement under the Federal marketing order for California raisins.
The continuance referendum scheduled between November 2023 and November
2025 overlaps with the timeframe the Agricultural Marketing Service
(AMS) plans to conduct a formal rulemaking to amend the marketing
order. This suspension delays the enforcement of the continuance
referendum requirement to give precedence to the formal rulemaking
process, which may include a producer referendum. In addition, if the
marketing order is amended, this temporary suspension provides industry
time to operate under the amended marketing order before the next
scheduled continuance referendum.
DATES: Effective October 16, 2023, 7 CFR 989.91(c) is stayed through
November 26, 2029. Comments received by November 15, 2023 to be assured
of consideration.
ADDRESSES: Interested persons are invited to submit written comments
concerning this 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: <a href="https://www.regulations.gov">https://www.regulations.gov</a>.
Comments should reference the document number and the date and page
number of this issue of the Federal Register. All comments submitted in
response to this 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 identity of the individuals or entities
submitting the comments will be made public.
FOR FURTHER INFORMATION CONTACT: Christy Pankey, Marketing Specialist,
or Matthew Pavone, Branch Chief, Rulemaking Services Branch, Market
Development Division, Specialty Crops Program, AMS, 1400 Independence
Avenue SW, Stop 0237, Washington, DC 20250-0237; Telephone: (202) 720-
2491 Fax: (202) 720-8938, or Email: <a href="/cdn-cgi/l/email-protection#377a56455c5243784553524574585a5a525943774244535619505841"><span class="__cf_email__" data-cfemail="6924081b020c1d261b0d0c1b2a0604040c071d291c1a0d08470e061f">[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#2d7f444e454c5f490361425a485f6d585e494c034a425b"><span class="__cf_email__" data-cfemail="60320903080112044e2c0f17051220151304014e070f16">[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 Order No. 989, both
as amended (7 CFR part 989), hereinafter referred to as the ``Order,''
and the applicable provisions of the Agricultural Marketing Agreement
Act of 1937, as amended (7 U.S.C. 601-674), hereinafter referred to as
the ``Act.'' The Raisin Administrative Committee (Committee) locally
administers the Order and is comprised of growers and handlers of
raisins operating within the area of production and a public member.
The Committee consists of 47 members of whom 35 shall represent
producers, 10 shall represent handlers, 1 shall represent the
cooperative bargaining association(s) and 1 shall be a public member.
The Agricultural Marketing Service (AMS) is issuing this rule in
conformance with Executive Orders 12866, 13563, and 14094. Executive
Orders 12866 and 13563 direct agencies to assess 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. Executive Order 14094
directs agencies to conduct proactive outreach to engage interested and
affected parties through a variety of means, such as through field
offices, and alternative platforms and media. This action falls within
a category of regulatory actions that the Office of Management and
Budget (OMB) exempted from Executive Order 12866 review.
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. AMS has determined that 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. 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 the Department of
Agriculture (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 temporarily suspends the continuance referendum
requirement under section 989.91(c). On October 20,
[[Page 71274]]
2022, the Committee recommended amending the marketing order through
formal rulemaking and, in a separate request, recommended the
suspension of the continuance referendum scheduled to occur sometime
between November 2023 and November 2025. The Committee believes the
suspension would eliminate any potential confusion among producers
voting in two referendums in a two-year period.
Section 989.91(b) states that the Secretary shall terminate or
suspend the operation of any or all provisions of the Order, whenever
the Secretary finds that such provisions do not tend to effectuate the
declared policy of the Act. Section 989.91(c) specifies the Secretary
shall conduct a referendum no less than five crop years and no later
than six crop years from November 26, 2018, to ascertain whether
continuance of the Order is favored by producers. The requirement also
specifies that subsequent referenda be conducted every six crop years
thereafter. By this requirement, the timing of the next continuance
referendum is scheduled to occur sometime between November 2023 and
November 2025. AMS identifies this period as the same period when the
formal rulemaking process would occur, which may also include its own
referendum vote. In view of the anticipated time necessary to complete
the proposed formal rulemaking action and the likelihood of an
amendatory referendum being conducted within two years of the scheduled
continuance referendum, AMS determined that the continuance referendum
requirement should be suspended to minimize confusion among voters.
Secondly, AMS determined that to conduct a continuance referendum
during the same period for when the formal rulemaking is expected to
occur would not allow the industry time to fully consider the impact of
potentially new amendments to the Order. For these reasons, the
continuance referendum requirement would not tend to effectuate the
declared policy of the Act for that period of time, and therefore, AMS
has determined not to conduct the continuance referendum at the time
required by the Order.
Alternatively, AMS considered suspending the continuance referendum
until immediately after the conclusion of the formal rulemaking.
However, this timing would still result in multiple referenda occurring
within the same 2-year period, which may cause voter confusion, and
would prevent producers from having adequate time to evaluate any
potential results of the amendatory process before voting on the
continuance of the Order. To address these temporal concerns, AMS
determined that the suspension of the continuance referendum
requirement should extend until 2029, which is on course with the
original structure of the timeframe under the Order as discussed in the
preceding paragraph. This suspension would provide industry and the
Committee time to assess the benefits of amendments resulting from the
formal rulemaking, if any, prior to the continuance referendum, prevent
any voter confusion, and also maintain the structure of the timetable
in the Order. Based on that timetable, a continuance referendum would
be conducted to determine if California raisin producers sufficiently
support the Order as amended.
This rule suspends the continuance referendum requirement under
section 989.91(c). The next scheduled continuance referendum will be
conducted sometime between November 2029 and November 2030.
A 30-day comment period is provided to allow interested persons to
respond to this interim final rule. AMS will consider all written
comments received prior to the issuance of a final rule.
Regulatory Flexibility Analysis
Pursuant to requirements set forth in the Regulatory Flexibility
Act (RFA) (5 U.S.C. 601-612), AMS considered the economic impact of
this action on small entities. Accordingly, AMS prepared this
regulatory flexibility analysis. The purpose of the RFA is to fit
regulatory actions to the scale of businesses that are subject to such
actions so that small businesses will not be unduly or
disproportionately burdened by the action. Marketing orders issued
pursuant to the Act, and the rules issued thereunder, are unique in
that they are brought through group action of essentially small
entities acting on their own behalf.
Presently, there are approximately 18 handlers of raisins subject
to regulation under the Order and approximately 2,000 raisin producers
in the regulated area.
Small agricultural producers are defined by the Small Business
Administration (SBA) as those having annual receipts of less than
$4,000,000 (NAICS code 111332, Grape Vineyards). Small agricultural
service firms are defined by the SBA as those having annual receipts of
less than $34,000,000 (NAICS code 115114, Postharvest Crop Activities)
(13 CFR 121.201).
Using USDA National Agricultural Statistics Service (NASS) data,
the 2021 season average value of utilized production of California
processed raisin-type grapes (most of which are dried into raisins) is
$393.649 million. Dividing that figure by 2,000 producers yields an
annual average revenue per producer of $196,825, well below the SBA
large farm size of threshold of $4,000,000. In terms of annual sales of
processed raisin-type grapes, the majority of producers may be
classified as small entities.
Dividing the $393.649 million crop value figure by 18 handlers
yields an average annual sales per handler estimate of $21,869,389.
This annual average sales figure is measured at the producer-level crop
value, and to draw conclusions about the proportion of small handlers,
a handler margin estimate is needed.
There is no current publicly available estimate of an average
raisin handler margin, but a 1988 economic study of the California
raisin industry estimated producer-handler average margins of about 30
percent for bulk raisin shipments and about 60 percent for packaged
shipments. Current handler margins are likely somewhat smaller, since
the study was completed more than three decades ago, and current bulk
handling and packaging technologies are more efficient.
An alternative method to compute an average handler margin for
packaged raisins is to compare the NASS season average grower price per
ton for processed raisin-type grapes (converted to its dried weight
equivalent) with an average price per ton for packaged raisins that
USDA paid under its Commodity Procurement Program in recent years
($1.41 per pound, $2,820 per ton). The NASS 2021 season average grower
price for raisin-type grapes was $369 per ton. Using a standard
conversion factor of 4.62 to convert to a dried-weight equivalent, the
price per ton for raisins is $1,705 ($369 x 4.62). A computed handler
margin estimate is 65 percent ($2,820/$1,705-1). Since the Commodity
Procurement average price includes shipping cost to recipient
locations, the 65 percent margin is moderately overstated.
If a handler had annual raisin sales of exactly $34 million (the
SBA large firm size threshold) that would mean a handler margin of 55
percent above the producer level ($34,000,000/$21,869,389).
Since both abovementioned margin estimates for packaged raisin
shipments (60 and 65 percent) are close to the 55 percent margin
implied by the $34 million SBA size threshold, it can be concluded that
there are raisin handlers with annual sales both above and below the
size threshold. It is reasonable to assume that fewer than 9 of the 18
handlers have annual raisin sales well
[[Page 71275]]
above $34 million. Therefore, more than 9, a majority of handlers, have
raisin sales below $34 million and may be classified as small entities.
On October 20, 2022, the Committee recommended that AMS postpone
the scheduled continuance referendum to avoid the referendum period
overlapping with a formal rulemaking to amend the Order and any
potential confusion it would otherwise cause producers. After
considering the Committee's request, AMS determined that the scheduled
continuance referendum should be suspended while AMS conducts a formal
rulemaking to amend the Order and, if effectuated, while the industry
operates under such amended Order.
Section 989.91(b) authorizes the Secretary to terminate or suspend
the operation of any or all provisions of the Order, whenever the
Secretary finds that such provisions do not tend to effectuate the
declared policy of the act.
This interim final rule suspends the continuance referendum
requirement under section 989.91(c) of the Federal marketing order
regulating the handling of raisins produced from grapes grown in
California. The next scheduled continuance referendum will be conducted
no earlier than November 26, 2029. AMS will consider all comments
received prior to publication of a final rule in the Federal Register.
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 are necessary in those requirements as
a result of this rule. Should any changes become necessary, they would
be submitted to OMB for approval.
This interim final rule does not impose any additional reporting or
recordkeeping requirements on either small or large raisin 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 has not
identified any relevant Federal rules that duplicate, overlap, or
conflict with this interim 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 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 recommendations submitted by the Committee and
other available information, it is hereby found that this section
989.91(c) does not tend to effectuate the declared policy of the Act
for the period specified herein and should be stayed for that period.
This interim final rule invites comments on the temporary
suspension of the continuance referendum requirement under Marketing
Order 989, which regulates the handling of raisins produced from grapes
grown in California. A 30-day comment period is provided to allow
interested persons to respond to this rule. All written comments timely
received will be considered before a final rule is published in the
Federal Register.
Good Cause Analysis
Pursuant to section 553(b)(B) of the Administrative Procedure Act,
notice and comment are not required prior to the issuance of a final
rule if an agency, for good cause, finds that ``notice and public
procedure thereon are impracticable, unnecessary, or contrary to the
public interest.''
AMS has determined upon good cause that it is impracticable,
unnecessary, and contrary to the public interest to give preliminary
notice prior to putting this rule into effect because this rule should
be implemented as soon as possible since the continuance referendum
period was originally scheduled during this time period and the
potential formal rulemaking will likely begin soon, the Committee
discussed this issue at public meetings and unanimously recommended a
suspension of the continuance referendum, and the rule provides a
comment period and any comments received will be considered prior to
finalization of this rule.
For the reasons stated above, AMS also finds that good cause exists
for the interim final rule to be effective upon publication in the
Federal Register.
List of Subjects in 7 CFR Part 989
Grapes, Marketing agreements, Raisins, Reporting and recordkeeping
requirements.
For the reasons set forth in the preamble, the Agricultural
Marketing Service amends 7 CFR part 989 as follows:
PART 989--RAISINS PRODUCED FROM GRAPES GROWN IN CALIFORNIA
0
1. The authority citation for 7 CFR part 989 continues to read as
follows:
Authority: 7 U.S.C. 601-674.
Sec. 989.91 Suspension or termination.
0
2. In Sec. 989.91, paragraph (c) is stayed from October 16, 2023
through November 26, 2029.
Erin Morris,
Associate Administrator, Agricultural Marketing Service.
[FR Doc. 2023-22334 Filed 10-13-23; 8:45 am]
BILLING CODE P
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