[Federal Register: December 12, 2003 (Volume 68, Number 239)]
[Proposed Rules]               
[Page 69343-69358]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr12de03-17]                         





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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[[Page 69343]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 929

[Docket Nos. AO-341-A6; FV02-929-1]

 
Cranberries Grown in the States of Massachusetts, et al.; 
Secretary's Decision and Referendum Order on Proposed Amendment of 
Marketing Agreement and Order No. 929

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule and referendum order.

-----------------------------------------------------------------------

SUMMARY: This decision proposes amendments to the marketing agreement 
and order for cranberries grown in Massachusetts, Rhode Island, 
Connecticut, New Jersey, Wisconsin, Michigan, Minnesota, Oregon, 
Washington, and Long Island in the State of New York, and provides 
growers and processors with the opportunity to vote in a referendum to 
determine if they favor the changes. The amendments are based on those 
proposed by the Cranberry Marketing Committee (Committee), which is 
responsible for local administration of the order and other interested 
parties representing cranberry growers and handlers. This action is a 
partial decision on six of the proposed amendments listed in the notice 
of hearing. It has been determined that these amendments need to be 
expedited. The amendments include increasing Committee membership and 
related amendments. The proposed amendments are intended to improve the 
operation and functioning of the cranberry marketing order program.

DATES: The referendum will be conducted from January 19 to January 30, 
2004. The representative period for the purpose of the referendum is 
September 1, 2002, through August 31, 2003. Pursuant to the Paperwork 
Reduction Act, comments on information collection burden that would 
result from this proposal must be received by February 10, 2004.

ADDRESSES: Interested persons are invited to submit written comments 
concerning the information collection burden. Comments must be sent to 
the Docket Clerk, Marketing Order Administration Branch, Fruit and 
Vegetable Programs, AMS, USDA, 1400 Independence Avenue, SW., STOP 
0237, Washington, DC 20250-0237; Fax: (202) 720-8938, or E-mail: moab.docketclerk@usda.gov. All comments should reference the docket 
number and the date and page number of this issue of the Federal 
Register and will be made available for public inspection in the Office 
of the Docket Clerk during regular business hours, or can be viewed at: 
http://www.ams.usda.gov/fv/moab.html.

FOR FURTHER INFORMATION CONTACT: Kathleen M. Finn, Marketing Order 
Administration Branch, Fruit and Vegetable Programs, AMS, USDA, 1400 
Independence Avenue, SW., STOP 0237, Washington, DC 20250-0237; 
telephone: (202) 720-2491, or Fax: (202) 720-8938. Small businesses may 
request information on compliance with this regulation by contacting 
Jay Guerber, Marketing Order Administration Branch, Fruit and Vegetable 
Programs, AMS, USDA, 1400 Independence Avenue, SW., STOP 0237, 
Washington, DC 20250-0237; telephone (202) 720-2491; Fax (202) 720-
8938.

SUPPLEMENTARY INFORMATION: Prior documents in this proceeding: Notice 
of hearing issued on April 23, 2002, and published in the May 1, 2002, 
issue of the Federal Register (67 FR 21854).
    This administrative action is governed by the provisions of 
sections 556 and 557 of title 5 of the United States Code and, 
therefore, is excluded from the requirements of Executive Order 12866.

Preliminary Statement

    The proposed amendments were formulated based on the record of a 
public hearing held in Plymouth, Massachusetts on May 20 and 21, 2002; 
in Bangor, Maine on May 23, 2002; in Wisconsin Rapids, Wisconsin on 
June 3 and 4, 2002; and in Portland, Oregon on June 6, 2002. The 
hearing was held to consider the proposed amendment of Marketing 
Agreement and Order No. 929, regulating the handling of cranberries 
grown in the States of Massachusetts, Rhode Island, Connecticut, New 
Jersey, Wisconsin, Michigan, Minnesota, Oregon, Washington, and Long 
Island in the State of New York, hereinafter referred to collectively 
as the ``order.'' The hearing was held pursuant to the provisions of 
the Agricultural Marketing Agreement Act of 1937, as amended (7 U.S.C. 
601 et seq.), hereinafter referred to as the ``Act,'' and the 
applicable rules of practice and procedure governing the formulation of 
marketing agreements and marketing orders (7 CFR part 900). The notice 
of hearing contained numerous proposals submitted by the Committee, 
other interested parties and one proposed by the Agricultural Marketing 
Service (AMS). This action is a partial decision addressing a portion 
of the amendments listed in the notice of hearing that have been 
determined necessary to be expedited. Other proposed amendments listed 
in the notice of hearing will be addressed in a separate decision.
    The proposed amendments included in this decision would: Increase 
Committee membership to 13 grower members, 1 public member, 9 grower 
alternate members and 1 public alternate member; incorporate a 
``swing'' position whereby the group (either the major cooperative or 
growers representing other than the major cooperative) which handles 
more than 50 percent of the total volume produced is assigned an 
additional seat; revise nomination and selection provisions of the 
order, as well as quorum and voting requirements, to reflect the change 
in Committee membership; authorize tenure limitations to be restarted 
with the seating of the expanded Committee; re-establish districts and 
allocate the revised membership among those districts; allow the 
Committee to request tax identification numbers for voting purposes; 
authorize mail nominations for independent members; revise the 
alternate member provisions to reflect the change in Committee 
membership and for clarity purposes; and require Committee member 
nominee disclosure of non-regulated cranberry production.
    The Fruit and Vegetable Programs of AMS proposed to allow such 
changes as may be necessary to the order, if any of the proposed 
amendments are adopted, so that all of the order's provisions conform 
to the effectuated amendments.
    Thirty-two witnesses testified at the hearing. These witnesses 
represented

[[Page 69344]]

cranberry growers and handlers in the States currently covered by the 
order and in Maine. Some witnesses supported the proposed amendments, 
while others were opposed to the recommended changes or suggested 
modifications to them.
    At the conclusion of the hearing, the Administrative Law Judge 
fixed August 9, 2002, as the final date for interested persons to file 
proposed findings and conclusions or written arguments and briefs based 
on the evidence received at the hearing on proposal numbers 1, 3, 7 and 
13. The Administrative Law Judge fixed September 13, 2002, as the final 
date for interested persons to file proposed findings and conclusions 
or written arguments and briefs based on evidence received at the 
hearing on all other proposals. This briefing period was extended until 
September 20, 2002. A total of 17 briefs were filed, 16 of which 
addressed proposals in this decision.
    Regarding the proposals being discussed in this decision, the 
Committee filed a brief in support of its proposed amendments. Linda 
and Paul Rinta and Stephen L. Lacey (attorney for Clement Pappas & 
Company and Cliffstar Corporation) filed briefs requesting that all 
proposals relating to Committee structure be considered together. The 
Cape Cod Cranberry Growers' Association (CCCGA) filed a brief opposing 
a portion of proposal on the Committee structure. Ranger Cranberry Co., 
LLC, a Wisconsin grower, filed a brief supporting a modification to the 
Committee structure. Nine of the 11 briefs recommended that growers 
from the major cooperative be required to vote independently for 
Committee representatives rather than the current method of nomination 
by the cooperative management. All discussions on briefs pertaining to 
the proposals being recommended in this decision have been considered.

Proposals Being Recommended in this Decision

    The Committee's proposal to amend the Committee structure included: 
Increasing the membership; incorporating a member-at-large position; 
revising nomination and selection procedures, as well as quorum and 
voting requirements to reflect the increase in Committee membership; 
authorizing tenure limitations to be restarted with the seating of the 
expanded Committee; authorizing mail nominations; allowing the 
Committee to request tax identification numbers for voting purposes; 
and changing how alternates may fill positions on any member's absence. 
This proposal provided for amendments to Sec. Sec.  929.20, 929.21, 
929.22, 929.23, 929.27 and 929.32.
    Two other interested parties submitted proposals relating to 
restructuring the Committee. Stephen L. Lacey on behalf of Clement 
Pappas and Company, Inc., and Cliffstar Corporation proposed an 
amendment to Sec.  929.22 to alter the way nominations of cooperative 
members on the Committee are conducted by requiring cooperative 
nominees to be selected through an election process administered by the 
Committee. The Wisconsin Cranberry Cooperative proposed amendments to 
Sec. Sec.  929.22 and 929.23 to allow for equitable representation for 
all cooperative marketing associations in the industry.
    Stephen Lacey also proposed an amendment to Sec.  929.20 to require 
Committee member disclosure of unregulated production.
Material Issues
    The material issues in this decision presented on the record of the 
hearing are as follows:
    1. Whether to increase Committee membership to 13 grower members, 1 
public member, 9 grower alternate members and 1 public alternate 
member; incorporate a ``swing'' position whereby the entity (either the 
major cooperative or other than the major cooperative) which handles 
more than 50 percent of the total volume produced is assigned an 
additional seat; incorporate nomination and selection procedures to 
reflect the change in Committee membership; allow the Committee to 
request tax identification numbers for voting purposes; authorize mail 
nominations for independent members; modify the quorum and voting 
requirements to reflect the increased number of Committee members; 
restart tenure limitations to begin with the seating of the expanded 
Committee; and revise and clarify which alternates may fill positions 
in any member's absence.
    2. Whether to require Committee member disclosure of non-regulated 
production.
    3. Whether to expedite the decision on any or all of the proposals 
by omitting the recommended decision and proceeding directly to the 
Secretary's decision and referendum order.
Findings and Conclusions
    The following findings and conclusions on the material issues are 
based on the record of the hearing.

Material Issue Number 1

    Section 929.20 should be amended to increase Committee membership 
to 13 grower members, 1 public member, 9 grower alternate members and 1 
public alternate member and to reestablish districts. This section 
should also be amended to incorporate a ``member-at-large'' position 
whereby the group (either growers representing the major cooperative or 
growers representing entities other than the major cooperative) that 
handles more than 50 percent of the total volume produced is assigned 
an additional seat.
    Section 929.21 should be amended to restart tenure limitations with 
the seating of the expanded Committee and allow the initial members of 
the newly formed Committee to be seated for at least one term.
    Section 929.22 should be amended to revise nomination procedures to 
reflect the change in Committee membership and to allow the 
reestablished Committee to be nominated as soon as possible.
    Section 929.22 should be amended to allow the Committee to request 
tax identification numbers for voting purposes.
    Section 929.22 should be amended to authorize mail nominations for 
growers who represent entities other than the major cooperative.
    Section 929.27 should be amended to revise and clarify which 
alternate members can be seated in place of absent members.
    Section 929.32 should be amended to incorporate quorum and voting 
requirements to reflect the increased number of Committee members.
    Currently, the Committee is composed of 7 grower members, each with 
an alternate, and 1 public member and alternate. The public member 
position is not required. The production area is divided into 4 
districts and at least 1 member and alternate represent each district. 
The term of office for members and alternate members is 2 years 
beginning on August 1 of each even-numbered year, and members are 
limited to 3 consecutive terms. Those members who serve 3 consecutive 
terms are not eligible to serve as either a member or alternate member 
on the Committee until they have been off the Committee for at least 1 
full two-year term. There are no tenure requirements for alternate 
members.
    Representation is divided among 4 districts. District 1 includes 
the States of Massachusetts, Rhode Island and Connecticut. District 2 
includes the State of New Jersey and Long Island in the State of New 
York. District 3

[[Page 69345]]

includes the States of Wisconsin, Michigan and Minnesota. District 4 
includes the States of Oregon and Washington.
    Any cooperative marketing association that handles more than two-
thirds of the total volume of cranberries produced during the fiscal 
period during which nominations are made, or affiliated growers, 
nominates 4 persons to serve as members and 4 persons to serve as 
alternate members. At least one nominee must be from Oregon or 
Washington (District 4). For growers not affiliated with the 
cooperative marketing association, the committee holds nomination 
meetings in Districts 1, 2 and 3 to select nominees for the remaining 3 
positions. District 4 growers participate in the District 3 nomination 
procedure by mail ballot. Growers are entitled to cast one vote for the 
nominee in his or her respective district. USDA selects the members 
from the nominations made.
    Five members constitute a quorum and any action of the Committee 
requires at least five concurring votes. If the public member is 
present and chooses to vote, six members constitute a quorum and any 
Committee actions require at least six concurring votes.
    Section 929.27 sets forth that an alternate member shall act in the 
place and stead of his or her member. In the event both the member and 
alternate are absent, the Committee may designate any other alternate 
member to serve in the absent member and alternate's place. This 
provision also provides that no more than 4 cooperative members or 
alternates can serve as members at the same meeting and that the grower 
alternate cannot serve for a non-industry member.
    For the 2002 selection process, no cooperative marketing 
association handled more than two-thirds of the volume of cranberries 
produced during the 2001-2002 year. The order does not specify how the 
Committee should be structured under this circumstance. The order 
provides that members and alternate members shall serve until their 
respective successors are selected and have been qualified. Therefore, 
the current cooperative members of the Committee representing the major 
cooperative, as previously selected, will remain seated until an 
amendment to the order, if any, is adopted to address this situation. 
Nominations and selections were made for the 3 independent member and 
alternate seats.

Increasing Committee Membership

    The Committee proposed increasing Committee membership from 7 
grower members and 7 grower alternates to 13 grower members and 9 
grower alternates. As in the current order, there would be 1 public 
member and alternate, but the public member position would be required. 
Six members would represent the cooperative and six members would 
represent independent growers. The remaining grower position would 
represent the group (either the cooperative or independents) that 
handled more than 50 percent of the volume of cranberries produced in 
the prior crop year.
    The Committee's proposal retains 4 marketing order districts but 
recommends that they be reestablished to accommodate the expanded 
production area States.
    District 1 would include Massachusetts, Rhode Island, Connecticut, 
New York and Maine. Currently, District 1 includes Massachusetts, Rhode 
Island and Connecticut. District 2 would include New Jersey and 
Delaware. Currently, District 2 includes New Jersey and Long Island in 
the State of New York. District 3 would remain unchanged and include 
Wisconsin, Michigan and Minnesota. District 4 would remain unchanged 
and include Oregon and Washington. The expansion of the production area 
is not being considered in this document. Therefore, for purposes of 
discussion, the existing districts and production area are being used 
in this decision.
    Under the Committee's proposal, there would be 2 cooperative 
members (with 1 alternate member) and 2 independent members (with 1 
alternate member) each for Districts 1 and 3. There would be 1 
cooperative member and alternate member and 1 independent member and 
alternate member each for Districts 2 and 4. The member-at-large 
position would be selected from any of the marketing order districts.
    Record evidence indicated that the additional representation in 
Districts 1 and 3 is based, in large part, on the percentage of the 
production these two districts represent. During the 2000 crop year, 
production in District 1 represented 35 percent, District 2 represented 
9 percent, District 3 represented 46 percent and District 4 represented 
10 percent of total cranberry production.
    The Committee manager testified that increasing grower membership 
would provide more opportunities for a larger and more diverse group of 
growers to actively participate in the Committee process. He further 
testified that expansion of the membership is very important to 
ensuring that the industry would benefit from new ideas, approaches, 
viewpoints, and perspectives brought to the complex environment facing 
the cranberry industry.
    In support of increasing membership, a witness representing the 
major cooperative testified that the increased Committee size would 
allow for broader representation of growers from different producing 
areas while recognizing different volumes of cranberries being produced 
in different growing areas. He testified that without increasing the 
membership, it would be difficult to recognize the larger volume of 
cranberries produced in Wisconsin and Massachusetts without reducing 
representation from growing areas that produce lower volumes like New 
Jersey, Washington and Oregon.
    The record revealed that the Committee appointed an amendment 
subcommittee in 1997 to deliberate on ways to improve the marketing 
order. On modifying Committee membership, many alternatives were 
discussed. Alternatives included leaving the membership at 8 and 
increasing the membership to 9, 11 or 13. The primary reason for 
agreeing on membership of 13 involved determining how to allocate 
membership among the districts. The subcommittee believed that it was 
important to recognize the larger growing areas by providing them with 
at least one additional member. Equally important was to provide 
opportunities for membership for smaller growing areas.
    The subcommittee carefully considered increased costs. To 
compromise on this issue, the subcommittee recommended a lower number 
of alternates. In addition, discussions involved whether it was 
necessary for alternate members to attend every meeting. There were 
differing opinions on this, but most agreed that it was important for 
alternates to stay current with Committee activities so they are more 
prepared to serve as a member when needed.
    Witnesses testified in opposition to the Committee's proposal. Two 
witnesses were opposed to the increase in Committee size. A Wisconsin 
grower/handler testified that the additional costs associated would be 
excessive. Another witness representing the views of the Wisconsin 
Cranberry Growers Association believed that increasing the number of 
Committee members could hinder the Committee's ability to make timely 
decisions and would increase program administrative costs, which are 
ultimately borne by the growers.

[[Page 69346]]

    Other witnesses testified in opposition to the allocation of 
membership under the Committee's proposal. A Wisconsin grower/handler 
testified that this allocation was inequitable to independent growers 
in Wisconsin. He testified that membership should consistently be based 
on the volume of cranberries produced. This witness was primarily 
concerned that under the Committee's proposal, the State of Wisconsin 
would be grossly underrepresented on the Committee while other States 
would be significantly overrepresented. He offered alternatives that 
would provide the Wisconsin district with an additional seat by 
transferring a seat from one of the other districts.
    Another alternative discussed suggested that the number of growers 
should also be considered in allocating membership. Under this 
scenario, the State of Massachusetts would be allocated an additional 
seat.
    A witness representing the Wisconsin Cranberry Grower's 
Association, also agreed that membership should be modified to be 
proportional to production. He suggested 3 districts be established 
providing seats based on volume of cranberries produced and by 
association with independent and cooperative growers.
    Another Wisconsin grower proposed retaining the current 8 member 
Committee. She proposed having 3 districts--East coast, Midwest and 
West coast. There would be no allocation between cooperative and 
independent growers. Two members would be allocated for each district, 
with 1 swing vote for the growers affiliated with the handler who 
handled more than 50 percent of the crop.
    Record evidence supports modifying the Committee structure as 
proposed by the Committee. Increasing membership on the Committee 
should allow more growers to participate in the decision-making 
processes of the Committee. The benefits of increasing membership 
outweigh associated increased costs by providing more growers 
opportunities to have a voice on decisions that impact their 
livelihood. In addition, increasing membership will allow for more 
diverse membership and new and different ideas on the direction the 
Committee should follow in the future. Testimony indicated that a 
larger Committee would enable a larger number of growers to better 
understand how the marketing order works and the rationale behind the 
decisions. More growers becoming familiar with these complicated 
regulatory issues can only help to further disseminate information to 
even more industry members. Allowing more opportunities for growers to 
actively participate in this process will benefit the progress of the 
Committee.
    Increasing membership will also allow larger representation of 
growing areas that produce the majority of the volume of cranberries 
and still recognize the importance of all producing areas, regardless 
of size.
    Allocating the membership equally between the largest cooperative 
and the rest of the industry will provide an appropriate balance 
between representatives in the industry who may have different ideas on 
Committee determinations based on their affiliation. With this 
allocation, no group can impose their will on the other. Committee 
recommendations will need to have more than the votes of one group to 
pass. In addition, the member-at-large position will allow for the 
dominant group to be recognized by providing that group with an 
additional seat.
    Having 2 members from the districts that represent Wisconsin and 
Massachusetts reasonably recognizes the fact that those districts have 
a great economic interest at stake when more significant actions, such 
as volume regulation, are considered by the Committee. It is important 
to take into account the significance of the smaller growing regions, 
while recognizing that the potential scale of the impact increases with 
the volume of cranberries produced and regulated. In this regard, the 
Committee's proposal improves the current structure of the Committee.
    Allowing the smaller volume districts to have 1 member recognizes 
their significance to the industry. Using volume alone as a means of 
determining Committee membership does not take into consideration 
smaller growing regions. Although volume is certainly one criterion to 
be considered, opportunities must be provided for input by all segments 
of the industry.
    The proponents of providing District 3 an additional independent 
member based on the State of Wisconsin's comparative volume produced 
based their opinion solely on volume of production. However, USDA 
concludes, based on the reasons mentioned above, that providing an 
additional seat for District 3 at the exclusion of membership from 
Districts 2 or 4 is not desirable.
    Similar concerns would result with regard to the alternative 
proposed at the hearing to have 3 districts and no differentiation of 
membership based on cooperative or independent members. The proponent 
of this alternative was not concerned that it would be possible for the 
largest handler's growers to win all the seats. The chances for that 
happening would be real under this scenario and must be considered. 
Although the approach is simple and keeps the membership at its current 
level, this alternative could result in the undesirable result of one 
entity having every seat.
    The increase in Committee membership will likely increase costs to 
the Committee with the additional members attending meetings. 
Currently, 16 representatives generally attend meetings, as all 
alternates are entitled to attend each meeting. With a 14 member 
Committee and 9 alternates, there is the potential that costs will 
increase to send an additional 7 persons to meetings if all alternates 
attend. However, the benefits of broadening the membership of the 
Committee and equitably allocating seats would outweigh these increased 
costs. Since the implementation of volume regulations, more growers are 
expressing interest in being a part of the Committee's recommendations. 
Expansion of the Committee will allow more growers the opportunity to 
be involved in the process. The Committee's recommendation to reduce 
the number of alternates will provide appropriate district coverage for 
members that cannot attend meetings, while taking costs into account.
    By increasing the membership to 14 and establishing 4 districts as 
proposed by the Committee, regional representation will be maintained 
and additional representation to the largest growing districts will be 
provided. Committee and subcommittee deliberations on this issue were 
extensive and many alternatives were discussed. The Committee 
recommended the most equitable number and allocation of Committee 
membership while considering associated costs.
    Regarding the public member and alternate position, the Committee 
proposed requiring that position to be a part of the administrative 
body as opposed to the current structure where that position is not 
required. There was no opposition testimony on this, and the record 
evidence is that the public member's views are an important aspect of 
the Committee's decision making and should therefore be required.
    For the above reasons, it is recommended that Sec.  929.20 be 
amended to increase Committee membership to 13 grower members, 1 public 
member, 9 grower alternates and 1 public alternate and to reestablish 
districts to accommodate the additional members. Included in the 13 
grower members will be one member-at-large position (who

[[Page 69347]]

will have an alternate), which will be discussed later in this 
decision. Of the remaining 12 grower members, 6 will represent the 
major cooperative and 6 will represent growers from groups other than 
the major cooperative. Four districts will be established as follows:
    District 1 will represent the States of Massachusetts, Rhode Island 
and Connecticut. There will be 2 members from the major cooperative and 
1 alternate member, and 2 members from other than the major cooperative 
and 1 alternate member.
    District 2 will represent the State of New Jersey and Long Island 
in the State of New York. There will be 1 member from the major 
cooperative and 1 alternate member, and 1 member from other than the 
major cooperative and 1 alternate member.
    District 3 will represent the States of Wisconsin, Michigan, and 
Minnesota. There will be 2 members from the major cooperative and 1 
alternate member, 2 members from other than the major cooperative and 1 
alternate member.
    District 4 will represent the States of Oregon and Washington. 
There will be 1 member from the major cooperative and 1 alternate 
member, 1 member from other than the major cooperative and 1 alternate 
member.
    The member-at-large position can be from any of the marketing order 
districts.
    The order language should also provide that the Committee may 
establish, with USDA's approval, rules and regulations for the 
implementation and operation of this section. The Committee recommended 
this provision in the event a clarification or procedural change was 
needed in the future.

Nomination Procedures

    With the recommended expansion of the Committee and the 
establishment of a member-at-large position, it is necessary to modify 
the nomination procedures to correspond to the new Committee structure.
Allocation of Membership
    The Committee's proposed amendment to the nomination procedures 
allocates membership on the Committee based upon the expanded 
Committee.
    As proposed by the Committee, if the cooperative marketing 
association handles more than 50 percent of the total volume of 
cranberries produced, USDA would select 6 cooperative producer members 
representing growers from each of the 4 districts, 1 member-at-large 
cooperative producer member from any of the marketing order districts, 
6 independent producer members representing growers from each of the 4 
districts, 1 public member, 4 cooperative alternate members 
representing each of the 4 districts, 4 independent alternate members 
representing each of the 4 districts, 1 cooperative alternate at large 
member from any district, and 1 public member alternate.
    If the cooperative marketing association handles less than 50 
percent of the total volume of cranberries produced, the Committee 
proposed that USDA would select 6 cooperative producer members 
representing growers from each of the 4 districts, 6 independent 
producer members representing growers from each of the 4 districts, 1 
member-at-large independent producer member from any of the marketing 
order districts, 1 public member, 4 cooperative alternate members 
representing each of the 4 districts, 4 independent alternate members 
representing each of the 4 districts, 1 independent alternate at large 
member from any district, and 1 public member alternate.
    The Committee proposed that the 2 independent producer nominees 
receiving the highest number of votes cast in Districts 1 and 3 would 
be declared the independent member nominees from each of those 
districts. The nominee receiving the third highest number of votes cast 
in Districts 1 and 3 would be declared the independent alternate member 
nominee from each of those districts. The independent producer nominee 
receiving the highest number of votes cast in Districts 2 and 4 would 
be declared the independent member nominee from each of those 
districts. The independent producer nominee receiving the second 
highest number of votes cast in Districts 2 and 4 would be declared the 
independent alternate member nominee from each of those districts.
    If the independent growers are entitled to the member-at-large 
position, a separate election would be conducted. The producer 
receiving the highest number of votes would be declared the independent 
member-at-large and the producer receiving the second highest number of 
votes would be declared the independent alternate member-at-large.
    Testimony revealed that the amendment subcommittee appointed by the 
Committee deliberated at length on the nomination procedures and, after 
consensus was reached, recommended the proposal to the full Committee.
    The Committee's proposal does not modify the current order language 
that authorizes the cooperative or its growers to nominate qualified 
persons for the allotted member and alternate positions. Under the 
Committee's modified proposal, the group, either cooperative or 
independent, that handles more than 50 percent of the volume of 
cranberries handled, is awarded the member-at-large seat.
    At the hearing, the Committee proposed modifying their amendment 
regarding the member-at-large position in two regards. First, there is 
currently more than one cooperative marketing association in the 
industry. The proposed amendment published in the notice of hearing did 
not take this into consideration. The Committee proposed amending this 
section by allowing the cooperative marketing association that handles 
the greatest volume of cranberries produced during the fiscal period in 
which nominations are made to nominate the cooperative members and 
alternates.
    The second modification made by the Committee to the amendment 
published in the notice of hearing was to change the criteria used to 
determine which group is entitled to the member-at-large position from 
sales of cranberries to volume of cranberries handled. Testimony 
revealed that using handler sales could be problematic and 
administratively burdensome.
    Witnesses opposed to combining the smaller cooperatives with the 
largest cooperative testified that if the volume handled by the two 
current cooperatives were combined to determine which group is awarded 
the additional seat, the largest cooperative could handle 49 percent of 
the crop and the smaller cooperative could handle 2 percent. Under that 
scenario, the major cooperative would be allocated the additional seat. 
Witnesses did not believe it would be equitable for the major 
cooperative to have less than 50 percent of the volume handled and be 
entitled to an additional seat. A witness for the smaller cooperative 
testified that if his cooperative cannot be represented in the group 
with the dominant cooperative, he believes his cooperative should be 
able to participate in the independent elections to provide more 
opportunities for his cooperative to be represented.
    In addition, a brief filed on this issue on behalf of a handler 
states that the hearing record does not support establishing the 
threshold for determining which group is entitled to the member-at-
large position as 50 percent. The brief states that the cooperative 
should be entitled to an additional seat only if it handles more than 
66\2/3\ percent of the crop. In addition, the brief states that the 
Committee must demonstrate how conditions in the industry have changed

[[Page 69348]]

since the order was amended in 1962 and established a 66\2/3\ percent 
threshold to limit the cooperative to 4 seats.
    At the time the order was promulgated, the major cooperative 
handled more than 80 percent of the cranberries produced. The threshold 
for membership established at that time had nothing to do with 
allocating additional seats to a dominant group based on volume 
handled. The purpose of allowing 4 seats to the cooperative handling 
more than two-thirds of the volume of cranberries handled was to ensure 
their membership was limited to 4 seats, rather than guaranteeing them 
a certain number of seats. Conditions in the industry have changed in 
that the major cooperative now handles approximately two-thirds of the 
volume of cranberries produced. The current order language does not 
address how the industry should be structured in the event the major 
cooperative's percentage of volume handled falls below the two-thirds 
threshold and the order should be amended to address this inadequacy.
    With the Committee's recommendation of the member-at-large 
position, it is intended that the dominant group in the industry be 
awarded an additional seat on the Committee. The Committee recognized 
that the potential scale of the impact of Committee recommendations 
increases with the volume of cranberries produced and regulated. For 
this reason, the Committee recommended assigning an additional seat to 
the dominant group. It seems eminently reasonable to use a simple 
majority as a means of determining which group is entitled to an 
additional seat. Therefore, the threshold for determining the dominant 
group should be fifty percent.
    It has been concluded previously in this decision that the 
committee should be expanded. Therefore, it is necessary to revise 
current nomination provisions to accommodate the increase in seats on 
the committee. Nomination procedures for the independent members based 
on the increased membership as proposed by the Committee are found to 
be reasonable and are being recommended for adoption. Based on record 
evidence, smaller cooperatives should be allowed similar opportunities 
to be represented on the Committee. In addition, because the large 
cooperative will continue to nominate its members to the Committee if 
it chooses, it is necessary to modify this section of the nomination 
provisions regarding the independent and small cooperative seats.
    It is important that all growers are provided the opportunity for 
membership on the Committee and have a voice in who should represent 
their interests. Alternatives discussed included allowing the smaller 
cooperative to participate in the independent elections, as suggested 
by witnesses representing the small and large cooperative. Record 
evidence supports the notion that smaller cooperatives should not be 
combined with the dominant cooperative in the nomination process. They 
should be provided a greater opportunity to be represented on the 
Committee. Therefore, smaller cooperatives should be authorized to 
participate in the independent elections. It is expected that these 
growers can easily become a part of this nomination process, with 
minimal additional administrative expenses by the Committee. Although 
this process does not guarantee any smaller cooperatives membership on 
the Committee, it provides the same opportunities as those provided for 
the independent nominees.
    In addition, it is reasonable that the threshold for determining 
which entity will be assigned the member-at-large position should be 
based on the volume handled by the major cooperative versus all others. 
This specifically addresses the concerns expressed at the hearing where 
the major cooperative could be assigned the member-at-large position 
while handling less than a majority of the crop. Only the major 
cooperative's volume handled will be counted to determine if they are 
the dominant group entitled to an additional seat on the Committee.
    Since members of small cooperatives and independent growers will be 
participating in the same nomination process, it is necessary to modify 
the terminology used in defining the representation. In setting forth 
the nomination procedures and to determine which group is assigned the 
member-at-large position, the terminology will be changed from growers 
that represent ``cooperatives'' and ``independents'' to growers that 
represent the ``major cooperative'', which will be the dominant 
cooperative in the industry and growers that represent ``other than the 
major cooperative''.
    For the above stated reasons, the Committee's proposal establishing 
nomination procedures for the expanded Committee is being recommended 
for adoption, with modifications as discussed.
Sales Versus Handle in Determining Member-at-Large Position
    The Committee's proposal as set forth in the notice of hearing 
recommended using the percentage of handler sales of cranberries as 
opposed to the percentage of volume handled in determining which entity 
is entitled to the member-at-large position. At the hearing, the 
Committee modified this portion of the proposal to use volume handled 
in determining the member-at-large position. According to testimony, 
the Committee realized that using handler sales could be problematic 
and administratively burdensome.
    According to testimony from a grower who was a member of the 
amendment subcommittee, the reason the subcommittee recommended sales 
was that some of the independent handlers believed that their sales 
were climbing faster than the major cooperative. In addition, the 
subcommittee thought sales would be a better choice since the threshold 
for determining the dominant group was being established to 50 percent. 
This subcommittee member stated that there was much discussion and 
controversy on determining what constituted a sale, but that the 
consensus was that the first sale would be the one that counted.
    One of the reasons the Committee modified their proposal from 
handler sales back to volume handled was that it would be difficult to 
gain consensus on how sales would be allocated. In its brief, the 
Committee stated that even the proponents of the amendment found the 
terms ``sale'' and ``sold'' confusing when questions arose about the 
possibility of double accounting of cranberry inventories when 
interhandler transfers occur. The debate centered on which handler 
would be entitled to take credit for the sale. When a handler buys from 
another handler, it is a sale for the first handler. When the second 
handler resells the cranberries to its customer, it is also a sale.
    The Committee does report sales in its inventory reports for 
information purposes based on handler reports. The reporting of this 
data is for informational purposes only.
    It was determined by the Committee that due to these complexities 
and the possibility of an increased administrative burden associated 
with using handler sales as a basis for assigning the additional seat, 
the threshold should be based on volume handled. Under the order, 
``Handle'' means to can, freeze, or dehydrate cranberries with the 
production area, or to sell, consign, deliver, or transport fresh 
cranberries in or out of the production area. Handlers are accustomed 
to reporting figures based on handling of cranberries, and the 
Committee has an internal mechanism in place to track interhandler 
transfers

[[Page 69349]]

to ensure that double accounting does not take place.
    This is not to be confused with grower sales which are used in 
establishing each grower's sales history. Grower deliveries (or sales) 
to handlers are easily tracked for the purposes of computing sales 
histories.
    Record evidence does not support basing the member-at-large 
position on handler sales. The hearing record indicated there could be 
confusion and possible controversy in coming to consensus on 
determining what constitutes a sale. As stated in the record, handlers 
have been reporting volumes handled since the order was implemented. 
There have been very few problems associated with defining what is 
``handled''. The Committee manager testified that there are safeguards 
in place that allow the Committee to crosscheck and assure that proper 
numbers are being reported.
    Therefore, the member-at-large position should be determined by 
calculating the volume of cranberries handled.
Major Cooperative's Nomination of Members
    Two proposed amendments submitted by industry representatives 
recommended altering the way the nominations of the major cooperative 
are currently authorized under the order by requiring cooperative 
nominees to be selected through an election process administered by the 
Committee.
    The Committee's proposal did not modify the current order language 
that authorizes the cooperative, or its growers to nominate qualified 
persons for the allotted member and alternate positions.
    Proponents of changing the nomination procedures for the 
cooperative testified that the major cooperative's growers should be 
provided the right to vote for a member on the Committee. It was 
testified that both groups should nominate members the same way.
    A proponent testified that allowing the cooperative to nominate its 
members without direct input from its growers while independent members 
are nominated through a voting process has caused controversy in the 
industry and a lack of confidence in Committee activities. He testified 
that the cooperative nominees should be nominated in the same manner as 
independents, through an election process administered by the 
Committee.
    The witness further testified that to allow the cooperative growers 
to elect their nominees would bolster industry confidence in the 
Committee, ensure better representation of the interests of growers, 
and more clearly demonstrate desires of industry to USDA and the 
public. He testified that there may be a slight increase in Committee 
expenses if the cooperative is required to nominate its members through 
an election process due to additional nomination procedures. The number 
of Committee meetings would remain the same so costs would not increase 
in that regard. He believed that any increase would be outweighed by 
benefits of ensuring that the Committee better represents the needs of 
producers while bolstering public confidence in the Committee.
    Another proponent, representing a small cooperative, testified that 
the Committee's proposal for nomination procedures where the small 
cooperatives are combined with the large cooperative would provide no 
opportunity for his organization to be represented on the Committee. He 
believed his proposal would address this by allowing all cooperative 
growers to nominate and vote for the cooperative representatives on the 
Committee.
    A witness in support of the proposals testified that under the 
process that independent members are selected, if a grower is unhappy 
with the way an independent member voted during a meeting, the grower's 
recourse is to try to ensure that that member does not get elected 
during the next election. He testified that the major cooperative's 
growers do not have that opportunity because their members are 
nominated by management.
    A representative of the major cooperative testified in opposition 
to the proposals. He stated that the current nomination procedures for 
cooperative members on the Committee are consistent with the principles 
of cooperative governance. He testified that the board of the major 
cooperative is charged with the responsibility and authority to oversee 
the operation of the cooperative's business. Committee nominations 
being made by their cooperative helps assure that they carefully 
consider the collective voice growers provide through their 
cooperative.
    The order currently authorizes the cooperative marketing 
organization, or the growers affiliated therewith, to nominate its 
members. The cooperative has two options under this provision and 
currently chooses to allow the board to make the nominations. It also 
has the option of conducting an election of its growers to nominate the 
seats to the Committee.
    Congress recognized the importance of cooperatives as 
representative of the collective voice of many growers when the Act was 
enacted. It is not USDA's intent to regulate the internal operations of 
cooperative management through an amendment to the marketing order. The 
order authorizes the cooperative or its growers to nominate seats to 
the Committee. That discretion should remain with the cooperative.
    Record evidence supports that the nomination by the cooperative for 
cooperative representatives to the Committee should remain unchanged in 
that the cooperative or the growers affiliated therewith, shall 
nominate its members. Therefore, the proposals to change the way the 
cooperative nominates its members are denied.
Tenure
    The term of office for members and alternates on the Committee is 
currently 2 years. Committee members are limited to 3 consecutive 
terms. The Committee is proposing that the term limitations for the 
current members be reset. In its proposal, the Committee recommended 
that current Committee members who have not met the 3 consecutive term 
limitation and who are re-nominated and selected would be able to serve 
an additional 3 consecutive 2-year terms before becoming ineligible to 
serve on the Committee.
    Testimony revealed that with the increase in Committee membership, 
a loss of a member solely due to term limitations could have an adverse 
impact on the Committee's decision-making abilities, particularly when 
there are new and inexperienced members selected for membership. 
Restarting term limitations when the expanded Committee is seated would 
ensure that experienced and knowledgeable members could remain on the 
Committee. There was no opposition testimony regarding resetting term 
limits at the hearing.
    A grower/handler who is opposed to term limits in general testified 
that with the small turnout for nominations and limited growers to be 
nominated in some districts, there should not be term limits. He 
believed that term limits take away growers' rights to choose who they 
want to represent them. A suggestion was made to allow an exemption 
from term limits in the event another grower was not available to fill 
the position.
    Since it is recommended that the Committee be re-structured by 
increasing membership, it is determined that term limitations should be 
reset to allow for a smooth transition of the new Committee. With the 
increase in membership, it is possible that there would be members that 
have never served on the Committee before. It is critical to maintain 
the experience and

[[Page 69350]]

expertise needed so that the Committee can continue its operations with 
a minimum of disruptions. Resetting the tenure limitations 
simultaneously with the seating of the expanded Committee would provide 
the experienced members opportunities to remain on the Committee and 
assist in transitioning the newer members as they become familiar with 
the regulatory process.
    Regarding the testimony on the need for term limits, it is USDA's 
view that a limit on tenure for Committee members would improve 
representation on the Committee by allowing for different and more 
contemporary ideas, and that such a limit would be beneficial to the 
Committee's operations. However, the issue of the smaller districts not 
having enough growers who want to be on the Committee is a concern. If 
a district with 15 growers only had one or two growers interested in 
serving on the Committee, it would be detrimental to have a qualified 
member step down because of term limits and have no one willing to step 
in. It does not appear that this would be an issue in districts with 
many growers, like Districts 1 and 3.
    In its brief, the Committee suggested a change to alleviate this 
situation. It proposed modifying the language in that provision to 
provide that members who have served 3 consecutive terms must leave the 
Committee for at least one full term before becoming eligible to serve 
again ``unless specifically exempted by the Secretary.'' The 
Committee's reason for including this language is to allow the 
Committee to petition USDA to retain an incumbent member beyond term 
limits if it is unable to find a new member to serve. The Committee 
believes this would ensure that growers from specified districts would 
continue to have representation.
    Because of the small number of growers in some districts, this 
situation could prove problematic in the future. For this reason, the 
phrase ``unless specifically exempted by the Secretary'' is being added 
to paragraph (c) of Sec.  929.21. This addition should not discourage 
the continued search by the Committee for new and diverse membership.
    The nomination provisions (Sec.  929.22) provided that nominations 
for the re-established Committee shall be held as soon as practicable 
after adoption of this amendment. Depending upon the timing of adoption 
of this amendment, new members could be nominated and selected to serve 
on the Committee close to the time of the next selection period.
    Therefore, USDA has added a proviso under this provision that 
initial members of the re-established Committee shall be seated for a 
minimum of one full term. For example, if a change in Committee 
structure becomes effective in March of 2004, the nomination process 
would commence immediately. Members selected through this process would 
serve up to August 2004 and at least two years from August 2004. This 
would help provide continuity on the Committee. In addition, the tenure 
limits would not start until August 1 of the first even numbered year 
after seating of the new Committee so that term limits and tenure can 
be computed concurrently.
    Therefore, Sec.  929.21 is proposed to be amended to restart tenure 
limitations on August 1 of the first even numbered year the new members 
serve. If this proposal were adopted, any past time served would not be 
counted toward any member's tenure. The term of office for each member 
and alternate member of the Committee would be for 2 years, beginning 
on August 1 of each even-numbered year and ending on the second 
succeeding July 31. Tenure limits would start on August 1 of the first 
even numbered year served.
    Exceptions are possible if deemed necessary by USDA. Term limits do 
not apply to alternates.

Quorum and Voting Requirements

    An increase in membership necessitates a proportionate increase to 
the number of members necessary to constitute a quorum and the number 
of concurring votes necessary to approve actions of the Committee. The 
Committee's proposal included such modifications.
    Specifically, the Committee recommended that 10 members must be 
present to constitute a quorum which expands to 11 if the public member 
is present. The Committee also proposed that the concurring votes 
necessary to pass any action be 10 if the public member is absent or 
abstains from voting and 11 if the public member votes.
    Adoption of this proposal would retain the super majority 
requirement for passing Committee actions that is in the current order. 
Concerns were raised at the hearing that these requirements were too 
stringent but testimony revealed that having stringent voting 
requirements ensures that consensus is reached among Committee members 
prior to any action being passed. Also, this proposal maintains the 
same requirements that are in the current order.
    Therefore, based on the above discussion, Sec.  929.32 is to be 
modified as proposed by the Committee. Implementation of this 
amendment, if adopted, would correspond to the establishment of the new 
Committee.

Mail Nominations

    Currently, the Committee is required to hold meetings in Districts 
1, 2, and 3 to elect independent nominees for member and alternate 
member positions on the Committee. District 4 growers who participate 
with District 3 in nominations are authorized to participate by mail.
    The Committee proposes eliminating the requirement for holding 
meetings of independent growers within each of the districts to 
nominate nominees for independent member and alternate members and 
authorizing all nominations to be conducted by mail. The record 
revealed that this proposal will allow growers greater opportunities to 
participate in Committee activities. The Committee would recommend 
procedures to USDA, wherein nominations could be made through a call 
for nominations mailed to each eligible independent producer. Such 
notification could contain a deadline for eligible, independent 
producers to submit the name of eligible, independent nominees. The 
Committee would prepare and mail a ballot to each grower. The ballots 
would be tallied and the nominations made in accordance with the 
nomination procedures.
    Following the end of the voting period, ballots received by the 
deadline would be separated by district and tallied in accordance with 
the nomination procedures for independent members.
    If the group other than the major cooperative were entitled to the 
member-at-large position, it is the Committee's intent that the member-
at-large position and independent nominations would take place 
simultaneously. This could cause confusion among growers interested in 
either position. To address this issue, testimony indicated that the 
Committee would need to develop and recommend procedures in the event 
the group other than the major cooperative is entitled to this seat. 
Section 929.22(i) provides authority for the Committee, with the 
approval of the Secretary, to issue rules and regulations to carry out 
the provisions of this section. The Committee may recommend regulations 
to clarify and implement this section, especially if there is any 
confusion in conducting nominations for the member-at-large position in 
the instance where it is assigned to the group representing growers 
from other than the major cooperative.
    The Committee expects that costs in conducting nominations under 
this

[[Page 69351]]

proposal would be decreased by not having to travel to hold meetings 
within the marketing order districts. There was no opposition testimony 
on authorizing mail balloting.
    It is determined that adoption of this proposal would have a 
positive impact by allowing more producers greater opportunity to 
participate in Committee activities. It should also provide for greater 
participation in the voting process as well as reduce costs associated 
with holding nomination meetings. Therefore, this proposal is 
recommended for adoption.

Selection

    The Committee proposed modifying this section to conform to the 
proposed increase in Committee structure. This section authorizes USDA 
to select the members and alternates on the Committee based on the 
nominees appointed in accordance with Sec.  929.22. This section has 
been modified to correspond with the nomination procedures as discussed 
previously.

Using Tax Identification Numbers

    The Committee proposed that a grower's tax identification number be 
used in the independent voting process to ensure that only eligible 
independent growers qualify for nomination and voting procedures. The 
Committee testified that using the tax identification number would 
assure that only eligible, independent producers qualify to nominate, 
be nominated and cast ballots in the independent nomination process.
    Currently, the Committee uses a ``grower identification number'' or 
``farm unit.'' The unit is based on growers' acreage and ownership of 
the property as reported to the Committee. Although this method has 
been mostly efficient, there are incidences where growers subdivide 
their acreage so they can track production from each bog/marsh. In 
these instances, growers are qualified to obtain separate grower 
numbers for each subdivided parcel and thereby, would have one vote for 
each grower number assigned.
    A grower/handler testified in opposition to this proposal because 
he believes it provides incentives for abuse. He advised that using tax 
identification numbers would make it possible for his company to break 
up its properties and receive 100 tax identification numbers. The 
witness supports the current method of identifying properties as farm 
units.
    In its brief, the Committee stated that if the proposal to 
authorize mail balloting is approved, a mechanism should be in place to 
discourage growers to subdivide their acreage in order to gain the 
ability to cast multiple ballots on behalf of a nominee. The Committee 
believes that growers who subdivide their bogs/marshes do so for a 
variety of reasons unrelated to the nomination process.
    Requiring one tax identification number for one nomination vote 
more appropriately clarifies the voting procedure. Growers may have 
reasons other than nomination voting to apply for multiple tax 
identification numbers as well as for subdividing their properties. 
However, tax identification numbers are considered more cumbersome to 
obtain than grower identification numbers and it would be less likely 
that growers would do so merely to obtain multiple votes in the 
nomination procedures.
    One grower testified that it would be unlikely that she would get 
another tax identification number because it would be too cumbersome. 
She supported the use of tax identification numbers as being a 
consistent way to keep track of properties. It is agreed that this 
would be a more efficient method of ensuring that growers are eligible 
to be nominated and vote in Committee member elections. Therefore, it 
is recommended that the order be amended to authorize the use of tax 
identification numbers in the voting process for growers that represent 
other than the major cooperative.

Alternates Authorized To Fill Member Positions

    The Committee proposal would also clarify which alternates could be 
seated in place of absent members. This change is needed to conform to 
the proposed change in Committee structure. The current language in 
this section states that not more than 4 members from each group can 
serve as members at the same meeting. Since there would be a minimum of 
6 members from each group in the proposed Committee, this language must 
be changed to reflect the change in Committee structure. This proposal 
would also be beneficial for clarity because the proposed change in 
Committee structure would have only 9 alternates selected to 
accommodate 14 members.
    As proposed, alternate members representing cooperative marketing 
organizations cannot be seated to serve in the place of either an 
independent or public member. Alternates representing independents 
cannot be seated to serve in the place of either cooperative marketing 
organizations or the public member, and the alternate public member 
cannot be seated to serve in the place of either the cooperative 
marketing organizations or independent members. There was no opposition 
testimony on this proposal.
    The Committee's proposal designates the groups of representatives 
on the Committee as cooperatives and independents. This decision 
modifies those designations as growers representing the major 
cooperative and growers representing other than the major cooperative. 
Because of this change, it is necessary to modify the language in the 
proposal to conform to this proposed amendment.
    Therefore, the amendatory text is being modified to provide that an 
alternate member representing the major cooperative cannot serve for a 
member representing other than the major cooperative or the public 
member. Likewise, an alternate member representing other than the major 
cooperative cannot serve for a member representing the major 
cooperative or the public member. The public alternate member cannot 
serve in place of any industry members.
    This proposed change is necessary to reflect the proposed change in 
Committee structure. In addition, because the proposal would provide 
fewer alternates than members, this clarification would be beneficial 
as it more specifically designates which member seat each alternate can 
replace in the member's absence. Therefore, record evidence herein 
supports amending Sec.  929.27, with modifications.
    The record supports these proposed amendments to Sec. Sec.  929.20, 
929.21, 929.22, 929.23, 929.27 and 929.32, with modifications.

Material Issue Number 2

    Section 929.20 should be amended to require Committee industry 
member and alternate member nominees' disclosure of non-regulated 
cranberry production. Currently, nominees for member and alternate 
member positions on the Committee are required to complete a 
qualification form providing information on the nominee's relation to 
the cranberry industry. This information includes how long the grower 
has been in the cranberry business, its associated handler, and 
involvement in cranberry associations. The information collected is 
used to determine whether nominees are eligible to serve in the 
positions for which they were nominated. Currently, there is no 
reporting requirement for members or alternate members regarding non-
regulated production.
    A proposal was made by an attorney representing a cranberry handler 
and recommended that Committee members also be required to submit 
information regarding their interest in foreign cranberry production. 
He testified that

[[Page 69352]]

foreign countries and States not regulated under the order are starting 
to emerge as significant producers of cranberries. Many producers in 
the production area are involved in this production. The proponent 
testified that when nominees for Committee representatives have a 
financial interest in the production of cranberries that are not 
subject to the order's regulations, it could be perceived as a conflict 
of interest, especially when these members are voting on issues as 
critical as volume regulation.
    This proposal would require Committee grower nominees and alternate 
grower nominees to disclose any financial interest in non-regulated 
production at the time of their nomination. The proponent believes it 
would be fair for growers to be informed of nominees' interests in 
production that would not be subject to order requirements.
    The proponent testified that this proposal would help maintain the 
integrity of the Committee and its actions by providing assurance that 
the Committee is acting in the best interest of production area 
producers. He suggested this information could be disclosed at meetings 
held for election of nominees or it could be required information on 
the qualifications statement currently required by nominees. He 
testified that this would ensure that growers are informed of this 
information prior to casting their vote to nominate a representative. 
He explained that it is not the intent of the proposal to bar potential 
members from serving on the Committee, as these producers are valuable 
members of the industry whose extensive knowledge can benefit the 
Committee.
    The proponent testified that the proposal is not intended to 
require disclosure of information such as the number of acres, 
financial information, or the nature of the business relationship as 
that level of detail could be proprietary in nature. The intent is to 
merely require the nominees to acknowledge the interest without 
divulging proprietary information. He further testified that the 
producers should only be required to report their individual interest 
in non-regulated production and not that of their handler.
    Although there was no opposition to the concept of requiring this 
information, questions arose at the hearing regarding what the term 
``financial interest'' would entail. For example, testimony indicated 
that the selling of vines, irrigation equipment, fertilizer, and etc. 
to foreign cranberry interests would not constitute financial interest.
    Testimony indicated that the disclosure would not need to include 
detailed financial information but instead be limited to only a general 
acknowledgement as to the nature of the financial interests, such as 
part and majority ownership.
    The record supports adding the requirement under Sec.  929.20 that 
nominees be required to acknowledge financial interest in non-regulated 
production. Because mail nominations are being authorized with this 
action, this information cannot be collected at nomination meetings. 
The collection of this information shall be added to the qualification 
statement required to be completed by nominees prior to selection. The 
information required would be an acknowledgement of financial interest 
in non-regulated production. In the event there is confusion in 
determining the nature or extent of information necessary for this 
proposed amendment, the committee may establish, with the approval of 
USDA, rules and regulations for the implementation and operation of 
this section in accordance with paragraph (e) of Sec.  929.20.
    Record evidence supports amending Sec.  929.20 by adding a 
requirement that grower nominees and alternate grower nominees of the 
Committee shall disclose annually any financial interest in the 
production of cranberries that are not subject to regulation by this 
part.

Material Issue Number 3

    The Committee requested expedited rulemaking on all of their 
proposals. This document sets forth a decision on Committee proposals 1 
(Committee structure); 19 (Committee member disclosure of non-regulated 
production) and 20 (Committee nomination procedures) filed by Stephen 
Lacey on behalf of Clement Pappas & Company, Inc. and Cliffstar 
Corporation; and 23 (Committee nomination procedures) and 24 (Committee 
selection procedures) filed by the Wisconsin Cranberry Cooperative.
    Evidence presented at the hearing established that the proposals 
relating to changing the Committee's administrative body need to be 
expedited. All other proposals will be addressed in a separate 
decision.
    The order currently states that any cooperative marketing 
organization that handled more than two-thirds of the total volume of 
cranberries produced during the fiscal period during which nominations 
for membership on the Committee are made, or the growers affiliated 
therewith, shall nominate four or more qualified persons for members 
and four or more qualified persons for alternate members. There is 
currently no cooperative marketing organization that handles more than 
two-thirds of the total volume of cranberries produced. Because the 
current order does not specify how the Committee should be structured 
in this event, the order should be amended as soon as possible to 
address this inadequacy. Consequently, it is determined that emergency 
conditions exist and the issuance of a recommended decision is 
therefore being omitted. In accordance with the rules of practice (7 
CFR part 900), it is found and determined that the record establishes a 
basis as noted above for proceeding directly to a Secretary's decision 
and referendum order. The proposed expedited amendments are to 
Sec. Sec.  929.20, 929.21, 929.22, and 929.23.
    The proposal clarifying how alternates may fill positions in any 
member's absence must be expedited as well. This proposal modifies 
Sec.  929.27. The current order language states that not more than four 
members and alternate members selected from the large cooperative shall 
serve as members at the same meeting. Since the Committee is being 
expanded, there will be a minimum of six members and three alternates 
serving at the same meeting. Therefore, this provision should be 
changed at the same time the Committee structure is expanded.
    As stated above, for the proposals recommending altering the 
Committee structure and clarifying how alternates fill absent member 
positions, the recommended decision is being omitted. These proposals 
were listed in the notice of hearing as proposal numbers 1, 2, 20, 23, 
and 24. Proposal number 19, submitted by Stephen Lacey, recommended 
adding a paragraph to Sec.  929.20, which would require Committee 
member disclosure of unregulated production. This proposal is being 
included to simplify the amendment of this section. The remaining 
proposals will be resolved in a separate decision.

Small Business Considerations

    Pursuant to the requirements set forth in the Regulatory 
Flexibility Act (RFA), AMS has considered the economic impact of this 
action on small entities. Accordingly, AMS has prepared this interim 
regulatory flexibility analysis.
    The purpose of the RFA is to fit regulatory actions to the scale of 
business subject to such actions so that small businesses will not be 
unduly or disproportionately burdened. Marketing orders and amendments 
thereto are unique in that they are normally brought about through 
group action of essentially small entities for their own

[[Page 69353]]

benefit. Thus, both the RFA and the Act are compatible with respect to 
small entities.
    Small agricultural producers have been defined by the Small 
Business Administration (SBA) (13 CFR 121.201) as those having annual 
receipts of less than $750,000. Small agricultural service firms, which 
include handlers regulated under the order, are defined as those with 
annual receipts of less than $5,000,000.
    Interested persons were invited to present evidence at the hearing 
on the probable regulatory and informational impact of the proposed 
amendments on small businesses. The record indicates that these 
amendments would not result in additional regulatory requirements being 
imposed on some cranberry growers and handlers.
    There are about 20 handlers currently regulated under Marketing 
Order No. 929. In addition, the record indicates that there are about 
1,250 producers of cranberries in the current production area.
    Based on recent years' price and sales levels, AMS finds that 
nearly all of the cranberry producers and some of the handlers are 
considered small under the SBA definition. In 2001, a total of 34,300 
acres were harvested with an average U.S. yield per acre of 156.2 
barrels. Grower prices in 2001 averaged $22.90 per barrel. Average 
total annual grower receipts for 2001 are estimated at $153,375 per 
grower. However, there are some growers whose estimated sales would 
exceed the $750,000 threshold. Thus, these proposed amendments will 
apply almost exclusively to small entities.
    Five handlers handle over 97 percent of the cranberry crop. Using 
Committee data on volumes handled, AMS has determined that none of 
these handlers qualify as small businesses under SBA's definition. The 
remainder of the crop is marketed by about a dozen grower-handlers who 
handle their own crops. Dividing the remaining 3 percent of the crop by 
these grower-handlers, all would be considered small businesses.
    This decision proposes that the order be amended: (1) To increase 
Committee membership to 13 members, 1 public member, 9 grower alternate 
members, 1 public alternate member; to incorporate a ``swing'' position 
whereby the entity (either the major cooperative or the group 
representing other than the major cooperative) which handles more than 
50 percent of the total volume of cranberries produced is assigned an 
additional seat; incorporate nomination and selection procedures to 
reflect the change in Committee membership; establish districts to 
reflect the change in Committee membership and to include additional 
States; allow the Committee to request tax identification numbers for 
voting purposes and authorize mail nominations for independent members; 
revise and clarify the provisions for alternates to reflect the change 
in Committee structure; and (2) require Committee member disclosure of 
non-regulated cranberry production.
    The proposed amendment to increase Committee membership to 13 
members, 1 public member, 9 grower alternate members, 1 public 
alternate member would increase the Committee's size by 6 members and 1 
alternate member. This would likely increase costs to the Committee 
with the additional members attending meetings. If alternate members 
are not required to attend all meetings, costs could be reduced. 
However, the record evidence supports increasing the Committee. The 
benefits of broadening the membership of the Committee and equitably 
allocating seats would outweigh increased costs. Since the 
implementation of volume regulations, more growers are expressing 
interest in being a part of the Committee's processes. Expansion of the 
Committee would allow more growers the opportunity to be involved in 
the process. The Committee's recommendation to not have one alternate 
for each member would provide appropriate district coverage for members 
that cannot attend meetings while taking costs into account. By 
increasing the membership to 14 and establishing 4 districts, regional 
representation would be maintained and additional representation to the 
largest growing regions would be provided.
    The proposal to include a member-at-large position on the Committee 
to the entity (either the major cooperative or the group representing 
other than the major cooperative) that handles more than 50 percent of 
the total volume of cranberries produced would provide an additional 
member and alternate to the dominant group. This allows for recognition 
that the scale of the impact increases with the volume of cranberries 
produced and regulated.
    The proposed amendment to reset term limitations for the current 
members would help maintain the experience and expertise needed so that 
the Committee can continue its operations with a minimum of 
disruptions.
    The proposed amendment to allow nominations to be conducted by mail 
would allow more growers greater opportunity to participate on the 
Committee and provide for greater participation in the voting process. 
Administrative Committee costs associated with holding nomination 
meetings would decrease.
    The proposed amendment to use growers' tax identification numbers 
in the voting process for the group representing other than the major 
cooperative would help ensure that only eligible growers qualify for 
nomination and the voting process.
    The proposed amendment to revise and clarify which alternates can 
be seated in place of absent members is necessary to conform to the 
proposed change in Committee structure. In addition, it would be 
beneficial as it more specifically designates which member seats each 
alternate can replace in the member's absence.
    The proposed amendment to require Committee member disclosure of 
non-regulated cranberry production would ensure that growers are 
informed of this information prior to casting their vote to nominate a 
representative on the Committee.
    All of these changes are designed to enhance the administration and 
functioning of the marketing agreement and order to the benefit of the 
industry. Accordingly, it is determined that the benefits of 
implementing the proposed revisions of the order would outweigh any 
associated costs. Costs are not anticipated to be significant.

Paperwork Reduction Act

    In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 
chapter 35), this notice announces that AMS is seeking approval from 
the Office of Management and Budget (OMB) for a new information 
collection request for Cranberries grown in 10 States, Marketing Order 
No. 929.
    Title: Cranberries grown in the States of Massachusetts, et al., 
Marketing Order No. 929.
    OMB Number: 0581-NEW.
    Type of Request: New collection.
    Abstract: The information collection requirements in this request 
are essential to carry out the intent of the Act, to provide the 
respondents the type of service they request, and to administer the 
cranberry marketing order program, which has been operating since 1962.
    Specifically, if the membership on the Committee is increased, the 
overall burden of completion of Committee generated forms and reports 
relative to Committee membership would increase due to additional 
membership. In addition, if the proposed amendment to require Committee 
member disclosure of non-regulated production is authorized, the 
qualification statement would have to be modified to include

[[Page 69354]]

this information. Total burden hours for completion of qualification 
forms for grower members and alternates is .58 hours. The additional 
membership and information required would increase this amount by .375 
hours, or a total of .955 hours. There would be no increase in the non-
regulated disclosure proposal since that would only entail an 
acknowledgement as to whether the member has a financial interest in 
non-regulated production.
    If the proposed amendment to authorize mail nominations is 
approved, a nomination form and ballot would be necessary to conduct 
mail nominations. It is estimated that there are approximately 500 
growers who would be entitled to vote by mail ballot once every two 
years. The estimated time to complete the nomination form would be 
approximately 5 minutes for an annual increase in burden hours of 
20.75. The estimated time to complete the ballot would be approximately 
5 minutes for an annual increase in burden hours of 20.75.
    If the proposed amendment to require growers to submit a tax 
identification number is approved, this information will be added to 
the grower sales and acreage report form (Form No. CMC-GSAR-1) 
currently approved under OMB. With minimal amount of time needed to add 
this number on the form, there will be no increase in burden for 
growers to complete this form.
    The information collection would be used only by authorized 
representatives of USDA, including AMS, Fruit and Vegetable Programs' 
regional and headquarters staff, and authorized Committee employees. 
Authorized Committee employees will be the primary users of the 
information and AMS is the secondary user.
    The request for approval for the new information collection under 
the order is as follows:

Cranberry Marketing Order Member and Alternate Member Nomination Form

    Estimate of Burden: Public reporting burden for this collection of 
information is estimated to average 5 minutes per response.
    Respondents: Cranberry growers.
    Estimated Number of Respondents: 500.
    Estimated Number of Responses per Respondent: .50.
    Estimated Total Annual Burden on Respondents: 20.75 hours.

Cranberry Marketing Order Member and Alternate Member Ballot

    Estimate of Burden: Public reporting burden for this collection of 
information is estimated to average 5 minutes per response.
    Respondents: Cranberry growers.
    Estimated Number of Respondents: 500.
    Estimated Number of Responses per Respondent: .50.
    Estimated Total Annual Burden on Respondents: 20.75 hours.
    Comments: Comments are invited on: (1) Whether the collection of 
information is necessary for the proper performance of the functions of 
the agency, including whether the information will have practical 
utility; (2) the accuracy of the agency's estimate of the burden of the 
collection of information, including the validity of the methodology 
and assumptions used; (3) ways to enhance the quality, utility, and 
clarity of the information to be collected; and (4) ways to minimize 
the burden of the collection of information on those who are to 
respond, including the use of appropriate automated, electronic, 
mechanical, or other technological collection techniques or other forms 
of information technology.
    Comments should reference OMB No. 0581-NEW and the Cranberry 
marketing order, and be sent to USDA in care of the Docket Clerk at the 
previously mentioned address. All comments received will be available 
for public inspection during regular business hours at the same 
address.
    All responses to this notice will be summarized and included in the 
request for OMB approval. All comments will become a matter of public 
record.
    As mentioned before, AMS is seeking approval from OMB for the 
additional burden imposed by the Cranberry Marketing Order Member and 
Alternate Member Nomination Form and Cranberry Marketing Order Member 
and Alternate Member Ballot. Upon OMB approval, the additional burden 
will be merged into the information collection currently approved under 
OMB No. 0581-0189, Generic OMB Fruit Crops.
    In addition to the information collection burden, a 60-day comment 
period is invited to allow interested persons to respond to this 
proposal. All written comments timely received will be considered prior 
to finalization of this decision.
    These provisions and any additional provisions modifying reporting 
and recordkeeping burdens that generate from these proposed amendments 
would not be effective until receiving OMB approval. Current 
information collection requirements for part 929, including referendum 
ballots, are approved by OMB under OMB number 0581-0189.
    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.
    The Department has not identified any relevant Federal rules that 
duplicate, overlap or conflict with this proposed rule. These 
amendments are designed to enhance the administration and functioning 
of the marketing order to the benefit of the industry.
    Committee meetings regarding these proposals as well as the hearing 
dates were widely publicized throughout the cranberry industry, and all 
interested persons were invited to attend the meetings and the hearing 
and participate in Committee deliberations on all issues. All Committee 
meetings and the hearing were public forums and all entities, both 
large and small, were able to express views on these issues.

Civil Justice Reform

    The amendments proposed herein have been reviewed under Executive 
Order 12988, Civil Justice Reform. They are not intended to have 
retroactive effect. If adopted, the proposed amendments would not 
preempt any State or local laws, regulations, or policies, unless they 
present an irreconcilable conflict with the amendments.
    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 Secretary 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. A handler is afforded the opportunity for a hearing on the 
petition. After the hearing the Secretary 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 the Secretary's 
ruling on the petition, provided an action is filed not later than 20 
days after date of the entry of the ruling.

Rulings on Briefs of Interested Persons

    Briefs, and the evidence in the record were considered in making 
the findings and conclusions set forth in this decision. To the extent 
that the suggested findings and conclusions filed by interested persons 
are inconsistent with the findings and conclusions of

[[Page 69355]]

this decision, the requests to make such conclusions are denied.
    Annexed hereto and made a part hereof is the document entitled 
``Order Amending the Order Regulating the Handling of Cranberries Grown 
in the States of Massachusetts, Rhode Island, Connecticut, New Jersey, 
Wisconsin, Michigan, Minnesota, Oregon, Washington, and Long Island in 
the State of New York.'' This document has been decided upon as the 
detailed and appropriate means of effectuating the foregoing findings 
and conclusions.
    It is hereby ordered, that this entire decision be published in the 
Federal Register.

Referendum Order

    It is hereby directed that a referendum be conducted in accordance 
with the procedure for the conduct of referenda (7 CFR part 900.400 et 
seq.) to determine whether the issuance of the annexed order amending 
the order regulating the handling of cranberries grown in the States of 
Massachusetts, Rhode Island, Connecticut, New Jersey, Wisconsin, 
Michigan, Minnesota, Oregon, Washington, and Long Island in the State 
of New York is approved or favored by growers and processors, as 
defined under the terms of the order, who during the representative 
period were engaged in the production or processing of cranberries in 
the production area.
    The representative period for the conduct of such referendum is 
hereby determined to be September 1, 2002, through August 31, 2003.
    The agent of the Secretary to conduct such referendum is hereby 
designated to be Kenneth G. Johnson, Regional Manager, DC Marketing 
Field Office, Marketing Order Administration Branch, Fruit and 
Vegetable Programs, AMS, USDA, 4700 River Road, Unit 155, Suite 2A04, 
Riverdale, Maryland 20737; telephone (301) 734-5243.

List of Subjects in 7 CFR Part 929

    Cranberries, Marketing agreements, Reporting and recordkeeping 
requirements.

    Dated: December 4, 2003.
A. J. Yates,
Administrator, Agricultural Marketing Service.

Order Amending the Order Regulating the Handling of Cranberries Grown 
in the States of Massachusetts, Rhode Island, Connecticut, New Jersey, 
Wisconsin, Michigan, Minnesota, Oregon, Washington, and Long Island in 
the State of New York \1\
---------------------------------------------------------------------------

    \1\ This order shall not become effective unless and until the 
requirements of Sec.  900.14 of the rules of practice and procedure 
governing proceedings to formulate marketing agreements and 
marketing orders have been met.
---------------------------------------------------------------------------

Findings and Determinations

    The findings and determinations hereinafter set forth are 
supplementary and in addition to the findings and determinations 
previously made in connection with the issuance of the order; and all 
of said previous findings and determinations are hereby ratified and 
affirmed, except insofar as such findings and determinations may be in 
conflict with the findings and determinations set forth herein.
    (a) Findings and Determinations Upon the Basis of the Hearing 
Record.
    Pursuant to the provisions of the Agricultural Marketing Agreement 
Act of 1937, as amended (7 U.S.C. 601 et seq.), and the applicable 
rules of practice and procedure effective thereunder (7 CFR part 900), 
a public hearing was held upon the proposed amendments to the Marketing 
Agreement and Order No. 929 (7 CFR part 929), regulating the handling 
of cranberries grown in the States of Massachusetts, Rhode Island, 
Connecticut, New Jersey, Wisconsin, Michigan, Minnesota, Oregon, 
Washington, and Long Island in the State of New York.
    Upon the basis of the evidence introduced at such hearing and the 
record thereof, it is found that:
    (1) The marketing agreement and order, as amended, and as hereby 
proposed to be further amended, and all of the terms and conditions 
thereof, will tend to effectuate the declared policy of the Act;
    (2) The marketing agreement and order, as amended, and as hereby 
proposed to be further amended, regulate the handling of cranberries 
grown in the production area in the same manner as, and is applicable 
only to persons in the respective classes of commercial and industrial 
activity specified in the marketing order upon which hearings have been 
held;
    (3) The marketing agreement and order, as amended, and as hereby 
proposed to be further amended, are limited in application to the 
smallest regional production area which is practicable, consistent with 
carrying out the declared policy of the Act, and the issuance of 
several orders applicable to subdivisions of the production area would 
not effectively carry out the declared policy of the Act;
    (4) The marketing agreement and order, as amended and as hereby 
proposed to be further amended, prescribe, insofar as practicable, such 
different terms applicable to different parts of the production area as 
are necessary to give due recognition to the differences in the 
production and marketing of cranberries grown in the production area; 
and
    (5) All handling of cranberries grown in the production area as 
defined in the marketing agreement and order, as amended, and as hereby 
proposed to be further amended, is in the current of interstate or 
foreign commerce or directly burdens, obstructs, or affects such 
commerce.

Order Relative to Handling

    It is therefore ordered, that on and after the effective date 
hereof, all handling of cranberries grown in the States of 
Massachusetts, Rhode Island, Connecticut, New Jersey, Wisconsin, 
Michigan, Minnesota, Oregon, Washington, and Long Island in the State 
of New York, shall be in conformity to, and in compliance with, the 
terms and conditions of the said order as hereby proposed to be amended 
as follows:
    The provisions of the proposed marketing agreement and the order 
amending the order will be and are the terms and provisions of this 
order amending the order and are set forth in full herein.

PART 929--CRANBERRIES GROWN IN THE STATES OF MASSACHUSETTS, RHODE 
ISLAND, CONNECTICUT, NEW JERSEY, WISCONSIN, MICHIGAN, MINNESOTA, 
OREGON, WASHINGTON, AND LONG ISLAND IN THE STATE OF NEW YORK

    1. The authority citation for 7 CFR part 929 continues to read as 
follows:

    Authority: 7 U.S.C. 601-674.
    2. Revise `` 929.20 to read as follows:


929.20  Establishment and membership.

    (a) There is hereby established a Cranberry Marketing Committee 
consisting of 13 grower members, and 9 grower alternate members. Except 
as hereafter provided, members and alternate members shall be growers 
or

[[Page 69356]]

employees, agents, or duly authorized representatives of growers.
    (b) The committee shall include one public member and one public 
alternate member nominated by the committee and selected by the 
Secretary. The public member and public alternate member shall not be a 
cranberry grower, processor, handler, or have a financial interest in 
the production, sales, marketing or distribution of cranberries or 
cranberry products. The committee, with the approval of the Secretary, 
shall prescribe qualifications and procedures for nominating the public 
member and public alternate member.
    (c) Members shall represent each of the following subdivisions of 
the production areas in the number specified in Table 1. Members shall 
reside in the designated district of the production area from which 
they are nominated and selected. Provided, that there shall also be one 
member-at-large who may be nominated from any of the marketing order 
districts.
    (1) District 1: The States of Massachusetts, Rhode Island and 
Connecticut;
    (2) District 2: The State of New Jersey and Long Island in the 
State of New York.
    (3) District 3: The States of Wisconsin, Michigan, and Minnesota.
    (4) District 4: The States of Oregon and Washington.

                                                     Table 1
----------------------------------------------------------------------------------------------------------------
                                                                                    Other than      Other than
                                                       Major           Major           major           major
                    Districts                       cooperative     cooperative     cooperative     cooperative
                                                      members       alternates        members       alternates
----------------------------------------------------------------------------------------------------------------
1...............................................               2               1               2               1
2...............................................               1               1               1               1
3...............................................               2               1               2               1
4...............................................               1               1               1               1
Any.............................................  ..............    1 member-at-
                                                                           large
----------------------------------------------------------------------------------------------------------------

    (d) Disclosure of unregulated production. All grower nominees and 
alternate grower nominees of the committee shall disclose any financial 
interest in the production of cranberries that are not subject to 
regulation by this part.
    (e) The committee may establish, with the approval of the 
Secretary, rules and regulations for the implementation and operation 
of this section.
    3. Revise Sec.  929.21 to read as follows:


Sec.  929.21  Term of office.

    (a) The term of office for each member and alternate member of the 
committee shall be for two years, beginning on August 1 of each even-
numbered year and ending on the second succeeding July 31. Provided: 
That following adoption of this amendment, the term of office for the 
initial members and alternates shall also include any time served prior 
to August 1 of the first even numbered year served. Members and 
alternate members shall serve the term of office for which they are 
selected and have been qualified or until their respective successors 
are selected and have been qualified.
    (b) Beginning on August 1 of the even-numbered year following the 
adoption of this amendment, committee members shall be limited to three 
consecutive terms. This limitation on tenure shall not include service 
on the committee prior to the adoption of this amendment or service on 
the committee by the initial members prior to August 1 of the first 
even-numbered year served and shall not apply to alternate members.
    (c) Members who have served three consecutive terms must leave the 
committee for at least one full term before becoming eligible to serve 
again unless specifically exempted by the Secretary. The consecutive 
terms of office for alternate members shall not be so limited.
    4. Revise Sec.  929.22 to read as follows:



Sec.  929.22  Nomination.

    (a) Initial members. As soon as practicable after adoption of this 
amendment, the committee shall hold nominations in accordance with this 
section. The names and addresses of all nominees shall be submitted to 
the Secretary for selection as soon as the nomination process is 
complete. Nominees selected for the initial Committee, following 
adoption of this amendment, shall serve a minimum of one two-year term 
beginning on August 1 of the first even numbered year served.
    (b) Successor members. Beginning on June 1 of the even-numbered 
year following the adoption of this amendment, the committee shall hold 
nominations in accordance with this section.
    (c) Whenever any cooperative marketing organization handles more 
than fifty percent of the total volume of cranberries produced during 
the fiscal period in which nominations for membership on the committee 
are made, such cooperative or growers affiliated therewith shall 
nominate:
    (1) Six qualified persons for members and four qualified persons 
for alternate members of the committee. These members and alternate 
members shall be referred to as the major cooperative members and 
alternate members. Nominee(s) for major cooperative member and major 
cooperative alternate member shall represent growers from each of the 
marketing order districts designated in Sec.  929.20.
    (2) A seventh major cooperative member shall be referred to as the 
major cooperative member-at-large. The major cooperative member-at-
large may be nominated from any of the marketing order districts.
    (3) Six qualified persons for members and four qualified persons 
for alternate members of the committee shall be nominated by those 
growers who market their cranberries through entities other than the 
major cooperative marketing organization. Nominees for member and 
alternate member representing entities other than the major cooperative 
marketing organization shall represent growers from each of the 
marketing order districts as designated in Sec.  929.20(c).
    (d) Whenever any major cooperative marketing organization handles 
50 percent or less of the total volume of cranberries produced during 
the fiscal period in which nominations for membership on the committee 
are made, the major cooperative or growers affiliated therewith, shall 
nominate:
    (1) Six qualified persons for major cooperative members and four 
qualified persons for major cooperative alternate members of the 
committee. Nominees for member and alternate member shall represent 
growers from each of the

[[Page 69357]]

marketing order districts as designated in Sec.  929.20(c).
    (2) Six qualified persons for members and four qualified persons 
for alternate members of the committee shall be nominated by those 
growers who market their cranberries through entities other than the 
major cooperative marketing organization. Nominees for member and 
alternate member shall represent growers from each of the marketing 
order districts as designated in Sec.  929.20(c).
    (3) A seventh member nominee shall be referred to as the member-at-
large representing entities other than the major cooperative marketing 
organization. The member-at-large may be nominated from any of the 
marketing order districts.
    (e) Nominations of qualified member nominees representing entities 
other than the major cooperative marketing organization shall be made 
through a call for nominations sent to all eligible growers residing 
within each of the marketing order districts. The call for such 
nominations shall be by such means as are recommended by the committee 
and approved by the Secretary.
    (1) The names of all eligible nominees from each district received 
by the committee, by such date and in such form as recommended by the 
committee and approved by the Secretary, will appear on the nomination 
ballot for that district.
    (2) Election of the member nominees and alternate member nominees 
shall be conducted by mail ballot.
    (3) Eligible growers shall participate in the election of nominees 
from the district in which they reside.
    (4) When voting for member nominees, each eligible grower shall be 
entitled to cast one vote on behalf of him/herself.
    (5) The nominee receiving the highest number of votes cast in 
districts two and four shall be the member nominee representing 
entities other than the major cooperative marketing organization from 
that district. The nominee receiving the second highest number of votes 
cast in districts two and four shall be the alternate member 
representing entities other than the major cooperative marketing 
organization from that district.
    (6) The nominees receiving the highest and second highest number of 
votes cast in districts one and three shall be the member nominees 
representing entities other than the major cooperative marketing 
organization from that district. The nominee receiving the third 
highest number of votes cast in districts one and three shall be the 
alternate member representing entities other than the major cooperative 
marketing organization from that district.
    (f) Nominations for the member-at-large representing entities other 
than the major cooperative marketing organization shall be made through 
a call for nominations sent to all eligible growers residing within the 
marketing order districts. The call for such nominations shall be by 
such means as recommended by the committee and approved by the 
Secretary.
    (1) Election of the member-at-large shall be held by mail ballot 
sent to all eligible growers in the marketing order districts by such 
date and in such form as recommended by the committee and approved by 
the Secretary.
    (2) Eligible growers casting ballots may vote for a member-at-large 
nominee from marketing order districts other than where they produce 
cranberries.
    (3) When voting for the member-at-large nominee, each eligible 
grower shall be entitled to cast one vote on behalf of him/herself.
    (4) The nominee receiving the highest number of votes cast shall be 
designated the member-at-large nominee representing entities other than 
the major cooperative marketing organization. The nominee receiving the 
second highest number of votes cast shall be declared the alternate 
member-at-large nominee representing entities other than the major 
cooperative marketing organization.
    (g) The committee may request that growers provide their federal 
tax identification number(s) in order to determine voting eligibility.
    (h) The names and addresses of all successor member nominees shall 
be submitted to the Secretary for selection no later than July 1 of 
each even-numbered year.
    (i) The committee, with the approval of the Secretary, may issue 
rules and regulations to carry out the provisions or to change the 
procedures of this section.
    5. Revise Sec.  929.23 to read as follows:


Sec.  929.23  Selection.

    (a) From nominations made pursuant to Sec.  929.22(b), the 
Secretary shall select members and alternate members to the committee 
on the basis of the representation provided for in Sec.  929.20 and in 
paragraph (b) or (c) of this section.
    (b) Whenever any cooperative marketing organization handles more 
than 50 percent of the total volume of cranberries produced during the 
fiscal year in which nominations for membership on the committee are 
made, the Secretary shall select:
    (1) Six major cooperative members and four major cooperative 
alternate members from nominations made pursuant to Sec.  929.22(c)(1).
    (2) One major cooperative member-at-large from nominations made 
pursuant to Sec.  929.22(c)(2), and
    (3) Six members and four alternate members from growers who market 
their cranberries through other than the major cooperative marketing 
organization made pursuant to Sec.  929.22(c)(3).
    (c) Whenever any major cooperative marketing organization handles 
50 percent or less of the total volume of cranberries produced during 
the fiscal year in which nominations for membership on the committee 
are made, the Secretary shall select:
    (1) Six major cooperative members and four major cooperative 
alternate members from nominations made pursuant to Sec.  929.22(d)(1).
    (2) Six members and four alternate members from nominations made 
pursuant to Sec.  929.22(d)(2).
    (3) One member-at-large representing entities other than the major 
cooperative marketing organization from nominations made pursuant to 
Sec.  929.22(d)(3).
    6. Revise Sec.  929.27 to read as follows:


Sec.  929.27  Alternate members.

    An alternate member of the committee, shall act in the place and 
stead of a member during the absence of such member, and may perform 
such other duties as assigned. In the event of the death, removal, 
resignation, or disqualification of a member, an alternate shall act 
for him/her until a successor for such member is selected and has 
qualified. In the event both a member and alternate member from the 
same marketing order district are unable to attend a committee meeting, 
the committee may designate any other alternate member to serve in such 
member's place and stead at that meeting provided that:
    (a) An alternate member representing the major cooperative shall 
not serve in place of a member representing other than the major 
cooperative or the public member.
    (b) An alternate member representing other than the major 
cooperative shall not serve in place of a major cooperative member or 
the public member.
    (c) A public alternate member shall not serve in place of any 
industry member.
    7. Revise Sec.  929.32 to read as follows:


Sec.  929.32  Procedure.

    (a) Ten members of the committee, or alternates acting for members, 
shall

[[Page 69358]]

constitute a quorum. All actions of the committee shall require at 
least ten concurring votes: Provided, if the public member or the 
public alternate member acting in the place and stead of the public 
member, is present at a meeting, then eleven members shall constitute a 
quorum. Any action of the committee on which the public member votes 
shall require eleven concurring votes. If the public member abstains 
from voting on any particular matter, ten concurring votes shall be 
required for an action of the committee.
    (b) The committee may vote by mail, telephone, fax, telegraph, or 
other electronic means; Provided that any votes cast by telephone shall 
be confirmed promptly in writing. Voting by proxy, mail, telephone, 
fax, telegraph, or other electronic means shall not be permitted at any 
assembled meeting of the committee.
    (c) All assembled meetings of the committee shall be open to 
growers and handlers. The committee shall publish notice of all 
meetings in such manner as it deems appropriate.

[FR Doc. 03-30598 Filed 12-11-03; 8:45 am]

BILLING CODE 3410-02-P