Proposed Rule2024-24733
Pistachios Grown in California, Arizona and New Mexico; Decreased Assessment Rate
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Published
October 30, 2024
Issuing agencies
Agriculture DepartmentAgricultural Marketing Service
Abstract
This proposed rule would implement a recommendation from the Administrative Committee for Pistachios (Committee) to decrease the assessment rate established for the 2024-2025 and subsequent production years from $0.0007 to $0.0003 per pound of assessable pistachios handled under the marketing order. The proposed assessment rate would remain in effect indefinitely unless modified, suspended, or terminated.
Full Text
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<title>Federal Register, Volume 89 Issue 210 (Wednesday, October 30, 2024)</title>
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[Federal Register Volume 89, Number 210 (Wednesday, October 30, 2024)]
[Proposed Rules]
[Pages 86287-86289]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2024-24733]
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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. 89, No. 210 / Wednesday, October 30, 2024 /
Proposed Rules
[[Page 86287]]
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 983
[Doc. No. AMS-SC-24-0021]
Pistachios Grown in California, Arizona and New Mexico; Decreased
Assessment Rate
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 decrease the
assessment rate established for the 2024-2025 and subsequent production
years from $0.0007 to $0.0003 per pound of assessable pistachios
handled under the marketing order. The proposed assessment rate would
remain in effect indefinitely unless modified, suspended, or
terminated.
DATES: Comments must be received by November 29, 2024.
ADDRESSES: Interested persons are invited to submit written comments
concerning this proposed rule. Comments can be sent to the Docket
Clerk, Market Development Division, Specialty Crops Program, AMS, USDA,
1400 Independence Avenue SW, STOP 0237, Washington, DC 20250-0237.
Comments can also be sent to the Docket Clerk electronically by Email:
<a href="/cdn-cgi/l/email-protection#3c715d4e57594855525b734e58594e7f5351515952487c494f585d125b534a"><span class="__cf_email__" data-cfemail="bef3dfccd5dbcad7d0d9f1ccdadbccfdd1d3d3dbd0cafecbcddadf90d9d1c8">[email protected]</span></a> or internet: <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.
Comments submitted in response to this proposed rule will be included
in the record, will be made available to the public and can be viewed
at: <a href="https://www.regulations.gov">https://www.regulations.gov</a>. 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: Peter Sommers, Marketing Specialist,
or Abigail Maharaj, Chief, West Region Branch, Market Development
Division, Specialty Crops Program, AMS, USDA; Telephone: (559) 487-
5901; or Email: <a href="/cdn-cgi/l/email-protection#431326372631116d102c2e2e26313003363027226d242c35"><span class="__cf_email__" data-cfemail="d686b3a2b3a484f885b9bbbbb3a4a596a3a5b2b7f8b1b9a0">[email protected]</span></a> or <a href="/cdn-cgi/l/email-protection#aaebc8c3cdcbc3c684e7cbc2cbd8cbc0eadfd9cecb84cdc5dc"><span class="__cf_email__" data-cfemail="c584a7aca2a4aca9eb88a4ada4b7a4af85b0b6a1a4eba2aab3">[email protected]</span></a>.
Small businesses may request information on complying with this
regulation by contacting Richard Lower, Marketing Development Division,
Specialty Crops Program, AMS, USDA, 1400 Independence Avenue SW, STOP
0237, Washington, DC 20250-0237; Telephone: (202) 720-8085, or Email:
<a href="/cdn-cgi/l/email-protection#07556e646f667563294b68706275477274636629606871"><span class="__cf_email__" data-cfemail="37655e545f564553197b58405245774244535619505841">[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
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 area of production, and a public
member.
The Agricultural Marketing Service (AMS) is issuing this proposed
rule in conformance with Executive Orders 12866, 13563, and 14094.
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. Executive
Order 14094 reaffirms, supplements, and updates Executive Order 12866
and further directs agencies to solicit and consider input from a wide
range of affected and interested parties through a variety of means.
This proposed 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 Federal 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 2024-2025 production
year, 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 8c(15)(A) of the
Act (7 U.S.C. 608(c)(15)(A)), any handler subject to an order may file
with U. S. 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 proposed rule would decrease the assessment rate for
pistachios handled under the Order from $0.0007 per pound, the rate
that was established for the 2021-2022 and subsequent production years,
to $0.0003 per pound for the 2024-2025 and subsequent production years.
Sections 983.70 and 983.71 of the Order authorize the Committee,
with the approval of AMS, to formulate an
[[Page 86288]]
annual budget of expenses and collect assessments from handlers to
administer the program. The members of the Committee are familiar with
the Committee's needs and with the costs of goods and services in their
local area and are able 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 2021-2022 and subsequent production years, the Committee
recommended, and AMS approved, an assessment rate of $0.0007 per pound
of assessable pistachios within the production area (87 FR 22105). That
rate continues in effect from production year to production year unless
modified, suspended, or terminated by AMS upon recommendation and
information submitted by the Committee or other information available
to AMS. This rule would decrease the assessment rate from $0.0007 to
$0.0003 per pound of assessable pistachios for the 2024-2025 and
subsequent production years.
The Committee held a public meeting on April 9, 2024, and
unanimously recommended an assessment rate of $0.0003 per pound of
assessable pistachios for the 2024-2025 and subsequent production
years. The Committee also met on July 10, 2024, and unanimously
recommended 2024-2025 production year expenditures of $956,700. In
comparison, last period's budgeted expenses were $1,145,161. The
proposed assessment rate of $0.0003 is $0.0004 less than the rate
currently in effect. The Committee recommended decreasing the
assessment rate to help ensure the Committee's compliance with Sec.
983.74, which stipulates that assessments will be reduced to bring
reserve funds to an amount that is less than or equal to two production
years' budgeted expenses.
The major expenditures recommended by the Committee for the 2024-
2025 production year include $512,900 for salaries and related
expenses, $125,000 for research, $100,000 for a contingency fund,
$73,500 for administrative expenses, and $10,000 for compliance
expenses. By comparison, budgeted expenses for these items during the
2023-24 production year were $631,900, $125,000, $200,000, $76,450 and
$10,000, respectively.
The Committee derived the recommended assessment rate by
considering anticipated expenses, anticipated production of assessable
pistachios, and the amount of funds available in the authorized
reserve. The expected 1 billion pounds of pistachios for the 2024-2025
production year would generate $300,000 in assessment revenue at the
proposed assessment rate (1,000,000,000 pounds multiplied by $0.0003
assessment rate). Income derived from handler assessments, along with
the California Pistachio Research Board (CPRB) management income of
approximately $220,200 and funds from the Committee's authorized
reserve of approximately $436,500, should be adequate to cover budgeted
expenses of $956,700. Funds available in the reserve (currently about
$844,000) would be kept within the maximum level of approximately two
production years' budgeted expenses as authorized by the Order.
The proposed assessment rate would 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 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. The
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 would be undertaken as necessary. The Committee's 2024-2025
budget, and those for subsequent production years would be reviewed
and, as appropriate, approved by AMS.
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 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 19 handlers subject to regulation under the Order, and
approximately 1,871 producers of pistachios in the production area.
Small agricultural producers of pistachios are defined by the Small
Business Administration (SBA) as those having annual receipts equal to
or less than $3.75 million (NAICS code 111335, Tree Nut Farming). Small
agricultural service firms (handlers) have been defined as those whose
annual receipts are equal to or less than $34 million (NAICS code
115114, Postharvest Crop Activities) (13 CFR 121.201).
Data from USDA's National Agricultural Statistics Service (NASS)
can be used to characterize the proportion of small versus large
pistachio producers and handlers according to the SBA standards. Due to
the significant year-to-year variation in pistachio production and crop
value, it is helpful to use two-year averages. The average value for
crop years 2022 and 2023 ($1.861 and $2.98 billion, respectively) is
$2.42 billion. Dividing $2.42 billion by 1,871 producers yields an
estimated average sales receipt per producer estimate of about $1.29
million, which is well below the $3.75 million threshold for small
producers. Assuming a normal distribution, the majority of pistachio
producers may be classified as small entities.
Estimating the proportion of small handlers requires an additional
computation. An average price per handler can be estimated using AMS
Market News prices for pistachio packages at the San Francisco terminal
market. The average terminal market price for 12 one-pound packages of
pistachios at the San Francisco terminal market from January to July
2024 was $41 per package. Dividing $41 by the weight of the package (12
pounds) yields a handler average price estimate of $3.417 per pound.
Dividing the SBA size standard of $34 million by $3.417 yields an
estimate of 9.951 million pounds per year (just under 10 million
pounds).
The Committee reported that 12 out of 19 handlers (63 percent)
handled under 10 million pounds per year. Therefore, 63 percent of the
pistachio handlers would be considered small handlers under the SBA
standard.
The Committee's recommended assessment rate of $0.0003 per pound of
assessable pistachios 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 proposed decreased assessment rate of
$0.0003 per pound is well below the computed maximum allowable rate of
$0.01 per pound (0.5
[[Page 86289]]
percent times $2.00, the 2023 average producer price reported by NASS).
Using the proposed new rate, the 2024-2025 annual Committee
assessment as a percent of producer revenue (crop value) can be
approximated using average production and crop value for the two prior
years. NASS reported utilized inshell pistachio production of 882
million pounds and 1.49 billion pounds, respectively, for the 2022 and
2023 crop years, with an average of 1.186 billion pounds. Multiplying
1.186 billion pounds by $0.0003 per pound yields estimated annual
Committee revenue of $355,800. Dividing estimated Committee revenue of
$355,800 by the two-year average crop value of $2.42 billion crop
yields an estimate of 0.01 percent. That is, the $355,800 estimated
annual assessment total represents one hundredth of one percent of
estimated producer revenue.
This proposal decreases the assessment rate collected from handlers
for the 2024-2025 and subsequent production years from $0.0007 to
$0.0003 per pound of assessable pistachios. The Committee unanimously
recommended 2024-2025 production year expenditures of $956,700 and an
assessment rate of $0.0003 per pound of assessable pistachios. The
proposed assessment rate of $0.0003 is $0.0004 lower than the rate
currently in effect. The volume of assessable pistachios for the 2024-
2025 production year is estimated at one billion pounds. Thus, the
$0.0003 per pound of assessable pistachios should provide $300,000 in
assessment income (1,000,000,000 pounds multiplied by $0.0003
assessment rate). Income derived from handler assessments, along with
CPRB management income of approximately $220,200 and funds from the
Committee's authorized reserve of approximately $436,500, should be
adequate to cover budgeted expenses.
The major expenditures recommended by the Committee for the 2024-
2025 production year include $512,900 for salaries and related
expenses, $125,000 for research, $100,000 for a contingency fund,
$73,500 for administrative expenses, and $10,000 for compliance
expenses. By comparison, budgeted expenses for these activities for the
2023-24 production year were $631,900, $125,000, $200,000, $76,450 and
$10,000, respectively.
The Committee recommended decreasing the assessment rate in
conjunction with utilization of funds from the authorized reserve to
cover Committee expenditures and ensure the financial reserve remains
at a level in compliance with Order requirements.
Prior to arriving at this budget and assessment rate, the Committee
considered alternate potential expenditure levels and the impact of
reducing the assessment rate more and/or less than the rate proposed
herein. However, the Committee determined that the recommended
assessment rate would achieve its goals of both adequately funding
Committee operations and reducing the reserve to an appropriate level.
A review of historical information and preliminary information
pertaining to the upcoming production year indicates the average
producer price for the 2024-2025 season should be approximately $2 per
pound. Therefore, the estimated assessment revenue for the 2024-2025
production year as a percentage of total producer revenue would be
about .015 percent ($0.0003 divided by $2 multiplied by 100).
This proposed rule would decrease the assessment obligation imposed
on pistachio handlers. Assessments are applied uniformly on all
handlers, and some of the cost may be passed on to producers. However,
these costs are expected to be offset by the benefits derived by the
operation of the Order.
The Committee's meetings are widely publicized throughout the
pistachio industry and all interested persons are invited to attend the
meetings and participate in Committee deliberations on all issues. Like
all Committee meetings, the April 9, 2024, and July 10, 2024, meetings
were public and all entities, both large and small, were able to
express views on this issue. Finally, interested persons are invited to
submit comments on this proposed rule, including the 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.
No changes in those requirements are 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, and for other purposes.
AMS 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.
After consideration of all relevant material presented, including
the information and recommendations submitted by the Committee and
other available information, AMS has determined that this proposed rule
is consistent with and would effectuate the purposes of the Act.
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
rulemaking.
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 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, 2024, an assessment rate of $0.0003 per
pound is established for California, Arizona, and New Mexico pistachios
covered under the Order.
Erin Morris,
Associate Administrator, Agricultural Marketing Service.
[FR Doc. 2024-24733 Filed 10-29-24; 8:45 am]
BILLING CODE P
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