WSR 09-19-142

PROPOSED RULES

DEPARTMENT OF AGRICULTURE


[ Filed September 23, 2009, 7:51 a.m. ]

Original Notice.

Preproposal statement of inquiry was filed as WSR 09-15-179.

Title of Rule and Other Identifying Information: The department is proposing to add a new section to chapter 16-401 WAC that establishes annual licensing and assessment fees for Christmas tree growers.

Hearing Location(s): Washington State Department of Agriculture, 1111 Washington Street S.E., Natural Resources Building, 2nd Floor, Conference Room 259, Olympia, WA 98504-2560, on October 28, 2009, at 9:00 a.m.

Date of Intended Adoption: November 4, 2009.

Submit Written Comments to: Henri Gonzales, P.O. Box 42560, Olympia, WA 98504-2560, e-mail hgonzales@agr.wa.gov, fax (360) 902-2094, by October 28, 2009.

Assistance for Persons with Disabilities: Contact Henri Gonzales by October 21, 2009, TTY (800) 833-6388.

Purpose of the Proposal and Its Anticipated Effects, Including Any Changes in Existing Rules: The department is proposing to carry out provisions of chapter 15.13 RCW by adopting annual licensing fees, including assessment fees, and a licensing process for Christmas tree growers. The anticipated result is establishment of a Christmas tree program within the Washington state department of agriculture (WSDA).

Reasons Supporting Proposal: During the 2007 legislative session, at the request of the Christmas tree industry, the Washington state legislature adopted amendments to chapter 15.13 RCW (see chapter 335, Laws of 2007) relative to Christmas tree grower licensure. This legislation authorizes the department to adopt rules for annual license fees that may include a base fee and per acre assessment and fee collection methods. During the 2009 legislative session, the Legislature authorized (as required by Initiative 960) the WSDA to establish Christmas tree grower licensing fees (see chapter 564, Laws of 2009).

The intent of the 2007 legislation is to establish a fee-funded program to enhance lines of communication, create a mechanism for the industry to advise WSDA, and furnish pest and certification services to the Christmas tree industry.

Statutory Authority for Adoption: RCW 15.13.311; chapter 34.05 RCW; chapter 335, Laws of 2007; chapter 564, Laws of 2009.

Statute Being Implemented: RCW 15.13.311; chapter 335, Laws of 2007; chapter 564, Laws of 2009.

Rule is not necessitated by federal law, federal or state court decision.

Name of Proponent: Washington chapter of the Pacific Northwest Christmas Tree Association, private.

Name of Agency Personnel Responsible for Drafting: Tom Wessels, 1111 Washington Street, Olympia, WA 98504-2560, (360) 902-1984; Implementation and Enforcement: Mary Toohey, 1111 Washington Street, Olympia, WA 98504-2560, (360) 902-1907.

A small business economic impact statement has been prepared under chapter 19.85 RCW.

Small Business Economic Impact Statement

Proposal: This proposal would establish a new fee in chapter 16-401 WAC. A Christmas tree grower license fee was authorized in amendments to chapter 15.13 RCW enacted in the 2007 legislative session, and authorization to establish the fee by rule was adopted in the 2009 legislative session.

Rule Background and Summary: Chapter 15.13 RCW authorizes the director to adopt rules establishing a Christmas tree grower license of not more than $40 base fee, plus an assessment of not more than $4 per acre, for a total maximum of $5,000. Christmas tree growers who sell trees exclusively to the ultimate consumer and who either have less than one acre of trees or harvest fewer than 400 trees annually would be exempt from this requirement. Chapter 15.13 RCW also authorizes the director to establish a Christmas tree advisory committee to advise the department on issues related to Christmas tree licensing. After establishing and consulting with the Christmas tree advisory committee, the department is proposing a Christmas tree grower license annual base fee of $40 plus $3 per acre assessment. The licensing period would be February 1 to January 31.

RCW 15.13.470 provides that revenues from the license fees would be deposited in an account within the agriculture local fund. These revenues may be used only for the Washington Christmas tree program, including the funding of market surveys and research related to Christmas trees.

Affected Groups and Costs: This proposal would affect all Christmas tree growers who do not meet the exemption summarized above. If this proposal is adopted, the department expects to license approximately 300 growers. The large majority of these growers are small businesses. The rule proposal consists of an annual base fee of $40, which would be paid by all growers, regardless of business size, plus an acreage assessment of $3 per acre. Larger acreages are indicators of larger business volumes, indicating that larger businesses would bear greater licensing costs. This proposal would not have a disproportionate economic effect on small business.

Industry Outreach: In 2007, at the request of the Christmas tree industry, chapter 15.13 RCW was revised to authorize the department to license Christmas tree growers and to adopt rules establishing a fee for the license. The following year Initiative 960 became effective, requiring specific approval from the legislature prior to establishment of new fees such as this. In 2009 the legislature authorized the department to establish a Christmas tree grower license fee as directed in the 2007 amendments to chapter 15.13 RCW. During the interim, the department had established a Christmas tree advisory committee representing the interests of Christmas tree growers in Washington. Among its members are representatives of the Washington chapter of the Pacific Northwest Christmas Tree Association, the Puget Sound Christmas Tree Association, and the Inland Empire Christmas Tree Association. The advisory committee met on July 30, 2009, and recommended the department go forward with this proposal. In mitigation of the economic effects of the rule, an acreage assessment of $3, rather than the maximum assessment, was recommended by the advisory committee and is proposed.

Other than information necessary to fill out the annual application for license prescribed in RCW 15.13.312, the proposal would result in no additional reporting, record-keeping or other compliance requirements. There are no additional equipment, supplies, labor, professional services, or increased administrative costs associated with the proposal. This proposal would not cause businesses to lose sales or revenue.

Alternatives: RCW 15.13.311 requires Christmas tree growers (unless they fall under the specified exemptions) to obtain a Christmas tree grower license. Options include a range of base fee (up to $40) and of acreage assessment (up to $4 per acre). The proposal was determined with the advice of the membership of the Christmas tree advisory committee, representing various areas and facets of the affected industry. Due to a lack of definitive information about the number of growers and their acreage in this state, data from which to project revenue from this license is lacking at this time.

Conclusion: This proposal would revise chapter 16-401 WAC to establish an annual license fee for Christmas tree growers and application process for this new license. An annual fee of $40 plus a $3 per acre assessment was recommended by the Christmas tree advisory committee. If the proposal is adopted, there will be ongoing evaluation of information generated by the requirement, by the department and the advisory committee, so that the program and its fee can be adjusted to meet the needs of the affected industry.

A copy of the statement may be obtained by contacting Henri Gonzales, P.O. Box 42560, Olympia, WA 98504-2560, phone (360) 902-2061, fax (360) 902-2094, e-mail hgonzales@agr.wa.gov.

A cost-benefit analysis is not required under RCW 34.05.328. The WSDA is not a listed agency under RCW 34.05.328 (5)(a)(i).

September 23, 2009

Mary A. Martin Toohey

Assistant Director

OTS-2698.1


NEW SECTION
WAC 16-401-045   Christmas tree grower license fees.   (1) All Christmas tree growers, except those exempted in subsection (5) of this section, must obtain a Christmas tree grower license.

(2) The licensing period for a Christmas tree grower license is February 1st to January 31st.

(3) The annual fee for a Christmas tree grower license is forty dollars plus an acreage assessment of three dollars per acre. The annual Christmas tree grower license fee for any person may not exceed five thousand dollars.

(4) Growers must submit an application for Christmas tree grower license and the annual fee to the department by February 1st.

(5) Any Christmas tree grower owning Christmas trees, whose business consists solely of retail sales to the ultimate consumer, is exempt from the requirements of this section if:

(a) The grower has less than one acre of Christmas trees; or

(b) The grower harvests, by u-cut or otherwise, fewer than four hundred Christmas trees per year.

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Washington State Code Reviser's Office