Vidalia Onions Grown in Georgia; Increased Assessment Rate, 14400-14403 [E8-5358]

Agencies

• Agricultural Marketing Service
• DEPARTMENT OF AGRICULTURE

[Federal Register Volume 73, Number 53 (Tuesday, March 18, 2008)]
[Proposed Rules]
[Pages 14400-14403]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-5358]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 955

[Docket No. AMS-FV-07-0159; FV08-955-1 PR]


Vidalia Onions Grown in Georgia; Increased Assessment Rate

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule.

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SUMMARY: This rule would increase the assessment rate established for 
the Vidalia Onion Committee (Committee) for the 2008 and subsequent 
fiscal periods from $0.10 to $0.13 per 40-pound container of Vidalia 
onions handled. The Committee locally administers the marketing order 
which regulates the handling of Vidalia onions

[[Page 14401]]

grown in Georgia. Assessments upon Vidalia onion handlers are used by 
the Committee to fund reasonable and necessary expenses of the program. 
The fiscal period begins January 1 and ends December 31. The assessment 
rate would remain in effect indefinitely unless modified, suspended, or 
terminated.

DATES: Comments must be received by April 17, 2008.

ADDRESSES: Interested persons are invited to submit written comments 
concerning this rule. 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 Internet: https://
www.regulations.gov. Comments should reference the docket number and 
the date and page number of this issue of the Federal Register and will 
be available for public inspection in the Office of the Docket Clerk 
during regular business hours, or can be viewed at: https://
www.regulations.gov.

FOR FURTHER INFORMATION CONTACT: Doris Jamieson, Marketing Specialist, 
or Christian D. Nissen, Regional Manager, Southeast Marketing Field 
Office, Fruit and Vegetable Programs, AMS, USDA; Telephone: (863) 324-
3375, Fax: (863) 325-8793, or E-mail: Doris.Jamieson@usda.gov, or 
Christian.Nissen@usda.gov.
    Small businesses may request information on complying 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, or E-mail: Jay.Guerber@usda.gov.

SUPPLEMENTARY INFORMATION: This rule is issued under Marketing 
Agreement and Order No. 955, both as amended (7 CFR part 955), 
regulating the handling of Vidalia onions grown in Georgia, hereinafter 
referred to as the ``order.'' The order is effective under the 
Agricultural Marketing Agreement Act of 1937, as amended (7 U.S.C. 601-
674), hereinafter referred to as the ``Act.''
    The Department of Agriculture (USDA) is issuing this rule in 
conformance with Executive Order 12866.
    This rule has been reviewed under Executive Order 12988, Civil 
Justice Reform. Under the marketing order now in effect, Vidalia onion 
handlers are subject to assessments. Funds to administer the order are 
derived from such assessments. It is intended that the assessment rate 
as proposed herein would be applicable to all assessable Vidalia onions 
beginning on January 1, 2008, and continue until amended, suspended, or 
terminated. This rule will not preempt any State or local laws, 
regulations, or policies, unless they present an irreconcilable 
conflict with this rule.
    The Act provides that administrative proceedings must be exhausted 
before parties may file suit in court. Under section 608c(15)(A) of the 
Act, any handler subject to an order may file with USDA a petition 
stating that the order, any provision of the order, or any obligation 
imposed in connection with the order is not in accordance with law and 
request a modification of the order or to be exempted therefrom. Such 
handler is afforded the opportunity for a hearing on the petition. 
After the hearing, USDA would rule on the petition. The Act provides 
that the district court of the United States in any district in which 
the handler is an inhabitant, or has his or her principal place of 
business, has jurisdiction to review USDA's ruling on the petition, 
provided an action is filed not later than 20 days after the date of 
the entry of the ruling.
    This rule would increase the assessment rate established for the 
Committee for the 2008 and subsequent fiscal periods from $0.10 to 
$0.13 per 40-pound container of Vidalia onions.
    The Vidalia onion marketing order provides authority for the 
Committee, with the approval of USDA, to formulate an annual budget of 
expenses and collect assessments from handlers to administer the 
program. The members of the Committee are producers and handlers of 
Vidalia onions. They are familiar with the Committee's needs and with 
the costs for goods and services in their local area and are thus in a 
position to formulate an appropriate budget and assessment rate. The 
assessment rate is formulated and discussed in a public meeting. Thus, 
all directly affected persons have an opportunity to participate and 
provide input.
    For the 2005 and subsequent fiscal periods, the Committee 
recommended, and USDA approved, an assessment rate that would continue 
in effect from fiscal period to fiscal period unless modified, 
suspended, or terminated by USDA upon recommendation and information 
submitted by the Committee or other information available to USDA.
    The Committee met on December 13, 2007, and unanimously recommended 
2008 expenditures of $712,000 and an assessment rate of $0.13 per 40-
pound container of Vidalia onions. In comparison, last year's budgeted 
expenditures were $835,200. The assessment rate of $0.13 is $0.03 
higher than the rate currently in effect.
    Over the past few years, the Committee has been using funds from 
reserves rather than increasing assessments to cover their expanded 
marketing program. This has reduced the reserve fund. The increase in 
the assessment rate would allow the Committee to fund its recommended 
level of promotion, while reducing the amount drawn from its authorized 
reserve fund.
    The major expenditures recommended by the Committee for the 2008 
fiscal year include $410,000 for marketing, $86,350 for salaries, 
$42,800 for compliance, and $37,200 for research. Budgeted expenses for 
these items in 2007 were $505,000, $82,000, $20,000, and $65,500, 
respectively.
    The assessment rate recommended by the Committee was derived by 
considering available reserves, and dividing anticipated expenses by 
expected shipments of Vidalia onions. Vidalia onion shipments for the 
year are estimated at 4,300,000 40-pound containers, which should 
provide $559,000 in assessment income. Income derived from handler 
assessments, along with interest income and funds from the Committee's 
authorized reserve, would be adequate to cover budgeted expenses. Funds 
in the reserve (currently $204,000) would be kept within the maximum 
permitted by the order (according to Sec.  955.44, approximately three 
fiscal periods' expenses).
    The proposed assessment rate would continue in effect indefinitely 
unless modified, suspended, or terminated by USDA upon recommendation 
and information submitted by the Committee or other available 
information.
    Although this assessment rate would be in effect for an indefinite 
period, the Committee would continue to meet prior to or during each 
fiscal period to recommend a budget of expenses and consider 
recommendations for modification of the assessment rate. The dates and 
times of Committee meetings are available from the Committee or USDA. 
Committee meetings are open to the public and interested persons may 
express their views at these meetings. USDA would evaluate Committee 
recommendations and other available information to determine whether 
modification of the assessment rate is needed. Further rulemaking would 
be undertaken as necessary. The Committee's 2008 budget and those for 
subsequent fiscal periods would be

[[Page 14402]]

reviewed and, as appropriate, approved by USDA.

Initial Regulatory Flexibility Analysis

    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA), the Agricultural Marketing Service (AMS) has considered the 
economic impact of this rule on small entities. Accordingly, AMS has 
prepared this initial regulatory flexibility analysis.
    The purpose of the RFA is to fit regulatory actions to the scale of 
business subject to such actions in order that small businesses will 
not be unduly or disproportionately burdened. Marketing orders issued 
pursuant to the Act, and the rules issued thereunder, are unique in 
that they are brought about through group action of essentially small 
entities acting on their own behalf.
    There are approximately 86 producers of Vidalia onions in the 
production area and approximately 65 handlers subject to regulation 
under the marketing order. Small agricultural producers are defined by 
the Small Business Administration (SBA) as those having annual receipts 
less than $750,000, and small agricultural service firms, which include 
handlers, are defined as those whose annual receipts are less than 
$6,500,000 (13 CFR 121.201).
    Based on the Georgia Agricultural Statistical Service and Committee 
data, the average annual grower price for fresh Vidalia onions during 
the 2007 season was around $15 per 40-pound container. Total Vidalia 
onions shipments for the 2007 season were around 4,868,000 40-pound 
containers. Using available data, more than 90 percent of Vidalia onion 
handlers could be considered small businesses under the SBA definition. 
In addition, based on information from the Georgia Department of 
Agriculture, Committee data, and the National Agricultural Statistics 
Service, the majority of producers could be considered small entities. 
Thus, the majority of handlers and producers of Vidalia onions may be 
classified as small entitles.
    This rule would increase the assessment rate established for the 
Committee and collected from handlers for the 2008 and subsequent 
fiscal periods from $0.10 to $0.13 per 40-pound container of Vidalia 
onions. The Committee unanimously recommended 2008 expenditures of 
$712,000 and an assessment rate of $0.13 per 40-pound container. The 
proposed assessment rate of $0.13 is $0.03 higher than the 2007 rate. 
The quantity of assessable Vidalia onions for the 2008 fiscal year is 
estimated at 4,300,000. Thus, the $0.13 rate should provide $559,000 in 
assessment income. Income derived from handler assessments, along with 
interest income and funds from the Committee's authorized reserve, 
would be adequate to cover budgeted expenses.
    The major expenditures recommended by the Committee for the 2008 
fiscal year include $410,000 for marketing, $86,350 for salaries, 
$42,800 for compliance, and $37,200 for research. Budgeted expenses for 
these items in 2007 were $505,000, $82,000, $20,000, and $65,500, 
respectively.
    Over the past few years, the Committee has been using funds from 
reserves rather than increasing assessments to cover their expanded 
marketing program. This has reduced the reserve fund. The increase in 
the assessment rate would allow the Committee to fund its recommended 
level of promotion, while reducing the amount drawn from its authorized 
reserve fund. Funds in the reserve (currently $204,000) would be kept 
within the maximum permitted by the order.
    The Committee reviewed and unanimously recommended 2008 
expenditures of $712,000 which included increases in administrative 
expenses, and compliance programs. Prior to arriving at this budget, 
the Committee considered information from various sources, including 
the Executive Committee and the Research Subcommittee. Alternative 
expenditure levels were discussed by the Committee based upon the 
relative value of various research and promotion projects to the 
Vidalia onion industry. The Committee also discussed keeping the 
current $0.10 per 40-pound bag or equivalent assessment rate. However, 
keeping the assessment rate at $0.10 per 40-pound bag would not allow 
the Committee to fund many of the proposed promotional projects. The 
assessment rate of $0.13 per 40-pound container of assessable Vidalia 
onions was then determined by considering available reserves, and 
dividing the total recommended budget by the quantity of assessable 
Vidalia onions, estimated at 4,300,000 40-pound containers for the 2008 
fiscal year. This is approximately $138,000 below the anticipated 
expenses, which the Committee determined to be acceptable.
    A review of historical information and preliminary information 
pertaining to the upcoming fiscal period indicates that the grower 
price for the 2008 season could range between $10.00 and $34.00 per 40-
pound container of Vidalia onions. Therefore, the estimated assessment 
revenue for the 2008 fiscal period as a percentage of total grower 
revenue could range between .4 and 1 percent.
    This action would increase the assessment obligation imposed on 
handlers. While assessments impose some additional costs on handlers, 
the costs are minimal and uniform on all handlers. Some of the 
additional costs may be passed on to producers. However, these costs 
would be offset by the benefits derived by the operation of the 
marketing order. In addition, the Committee's meeting was widely 
publicized throughout the Vidalia onion industry and all interested 
persons were invited to attend the meeting and participate in Committee 
deliberations on all issues. Like all Committee meetings, the December 
13, 2007, meeting was a public meeting and all entities, both large and 
small, were able to express views on this issue. Finally, interested 
persons are invited to submit comments on this proposed rule, including 
the regulatory and informational impacts of this action on small 
businesses.
    This proposed rule would impose no additional reporting or 
recordkeeping requirements on either small or large Vidalia onion 
handlers. As with all Federal marketing order programs, reports and 
forms are periodically reviewed to reduce information requirements and 
duplication by industry and public sector agencies.
    AMS is committed to complying with the E-Government Act, to promote 
the use of the Internet and other information technologies to provide 
increased opportunities for citizen access to Government information 
and services, and for other purposes.
    USDA has not identified any relevant Federal rules that duplicate, 
overlap, or conflict with this rule.
    A small business guide on complying with fruit, vegetable, and 
specialty crop marketing agreements and orders may be viewed at: http:/
/www.ams.usda.gov/fv/moab.html. Any questions about the compliance 
guide should be sent to Jay Guerber at the previously mentioned address 
in the FOR FURTHER INFORMATION CONTACT section.
    A 30-day comment period is provided to allow interested persons to 
respond to this proposed rule. Thirty days is deemed appropriate 
because: (1) The 2008 fiscal period began on January 1, 2008, and the 
marketing order requires that the rate of assessment for each fiscal 
period apply to all assessable Vidalia onions handled during such 
fiscal period; (2) the Committee needs to have sufficient funds to pay 
its expenses which are incurred on a continuous basis; and (3) handlers 
are aware of this action which was unanimously recommended by the 
Committee at a public meeting and is similar to other

[[Page 14403]]

assessment rate actions issued in past years.

List of Subjects in 7 CFR Part 955

    Onions, Marketing agreements, Reporting and recordkeeping 
requirements.

    For the reasons set forth in the preamble, 7 CFR part 955 is 
proposed to be amended as follows:

PART 955--VIDALIA ONIONS GROWN IN GEORGIA

    1. The authority citation for 7 CFR part 955 continues to read as 
follows:

    Authority: 7 U.S.C. 601-674.

    2. Section 955.209 is revised to read as follows:


Sec.  955.209  Assessment rate.

    On and after January 1, 2008, an assessment rate of $0.13 per 40-
pound carton or equivalent is established for Vidalia onions.

    Dated: March 12, 2008.
Lloyd C. Day,
Administrator, Agricultural Marketing Service.
 [FR Doc. E8-5358 Filed 3-17-08; 8:45 am]
BILLING CODE 3410-02-P