Oranges, Grapefruit, Tangerines, and Tangelos Grown in Florida; Order Amending Marketing Order No. 905, 46303-46306 [E9-21656]

Agencies

• Agricultural Marketing Service
• DEPARTMENT OF AGRICULTURE

[Federal Register Volume 74, Number 173 (Wednesday, September 9, 2009)]
[Rules and Regulations]
[Pages 46303-46306]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-21656]



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Federal Register / Vol. 74, No. 173 / Wednesday, September 9, 2009 / 
Rules and Regulations

[[Page 46303]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 905

[Doc. No. AO-85-A10; AMS-FV-07-0132; FV08-905-1]


Oranges, Grapefruit, Tangerines, and Tangelos Grown in Florida; 
Order Amending Marketing Order No. 905

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

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SUMMARY: This final rule amends the marketing order for oranges, 
grapefruit, tangerines, and tangelos grown in Florida. The amendments 
were proposed by the Citrus Administrative Committee (committee), which 
is responsible for local administration of the order. The amendments 
will modify committee representation by cooperative entities; allow 
substitute alternates to temporarily represent absent members at 
committee meetings; authorize the committee to conduct meetings by 
telephone or other means of communication; and authorize the committee 
to conduct research and promotion programs, including paid advertising, 
for fresh Florida citrus. The amendments are intended to improve the 
operation and administration of the order and provide the industry with 
additional tools for the marketing of fresh citrus.

DATES: This rule is effective October 9, 2009.

FOR FURTHER INFORMATION CONTACT: Melissa Schmaedick, Marketing Order 
Administration Branch, Fruit and Vegetable Programs, AMS, USDA, 1220 
SW. Third Avenue, Room 385, Portland, OR 97204; Telephone: (503) 326-
2724, Fax: (503) 326-7440, or E-mail: Melissa.Schmaedick@ams.usda.gov; 
or Laurel May, 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: Laurel.May@ams.usda.gov.
    Small businesses may request information on this proceeding 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@ams.usda.gov.

SUPPLEMENTARY INFORMATION: Prior documents in this proceeding: Notice 
of Hearing issued on January 24, 2008, and published in the January 29, 
2008, issue of the Federal Register (73 FR 5130); a Recommended 
Decision issued on December 19, 2008, and published in the December 24, 
2008, issue of the Federal Register (73 FR 79028); and a Secretary's 
Decision and Referendum Order issued on April 6, 2009, and published in 
the April 13, 2009, issue of the Federal Register (74 FR 16798).
    This action is governed by the provisions of sections 556 and 557 
of Title 5 of the United States Code and is therefore excluded from the 
requirements of Executive Order 12866.

Preliminary Statement

    This final rule was formulated on the record of a public hearing 
held on February 12, 2008, in Winter Haven, Florida. Notice of this 
hearing was issued on January 24, 2008, and published in the January 
29, 2008, issue of the Federal Register (73 FR 5130). The hearing was 
held to consider the proposed amendment of Marketing Order No. 905, 
hereinafter referred to 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. 601-674), 
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 four amendment proposals submitted 
by committee. Upon the basis of evidence introduced at the hearing and 
the record thereof, the Administrator of AMS on December 19, 2008, 
filed with the Hearing Clerk, U.S. Department of Agriculture, a 
Recommended Decision and Opportunity to File Written Exceptions thereto 
by January 23, 2009. No exceptions were filed.
    A Secretary's Decision and Referendum Order was issued on April 6, 
2009, directing that a referendum be conducted during the period May 4 
through May 18, 2009, among growers of fresh oranges, grapefruit, 
tangerines, and tangelos to determine whether they favored the proposed 
amendments to the order. To become effective, the amendments had to be 
approved by at least two-thirds of those producers voting or by voters 
representing at least two-thirds of the volume of citrus represented by 
voters in the referendum. Three of the proposed amendments were favored 
by 95 percent of the voters, representing 99 percent of the volume. One 
amendment was favored by 88 percent of voters, who represented 49 
percent of the volume.
    The amendments approved by voters and included in this order will:
    1. Modify committee representation by cooperative committees;
    2. Allow substitute alternates to temporarily represent absent 
members at committee meetings;
    3. Authorize the committee to conduct meetings by telephone or 
other means of communication; and
    4. Add authority for research and promotion programs, including 
paid advertising, for fresh Florida citrus.
    The Agricultural Marketing Service (AMS) also proposed to make such 
changes to the order as might be necessary to ensure that all of the 
order's provisions conform to the effectuated amendments. AMS proposed 
replacing the word ``he'' in the second sentence of Sec.  905.22(a)(2) 
with the words ``he or she'' to conform to other proposed changes to 
Sec.  905.22.
    An amended marketing agreement was subsequently provided to all 
fresh orange, grapefruit, tangerine, and tangelo handlers in the 
production area for their approval. The marketing agreement was not 
approved by handlers representing at least 50 percent of the volume of 
fresh oranges, grapefruit, tangerines, and tangelos handled by all 
handlers during the representative period of August 1, 2007 through 
July 31, 2008.

Small Business Considerations

    Pursuant to the requirements set forth in the Regulatory 
Flexibility Act (RFA)

[[Page 46304]]

(5 U.S.C. 601-612), AMS has considered the economic impact of this 
action on small entities. Accordingly, AMS has prepared this final 
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 benefit.
    Small agricultural service firms, which include handlers regulated 
under the order, have been defined by the Small Business Administration 
(SBA) (13 CFR 121.201) as those having annual receipts of less than 
$7,000,000. Small agricultural producers have been defined as those 
with annual receipts of less than $750,000.
    There are approximately 48 handlers of fresh citrus subject to 
regulation under the order and approximately 7,700 producers of fresh 
citrus in the regulated area. Information provided at the hearing 
indicates that over 90 percent of the handlers would be considered 
small agricultural service firms. Hearing testimony also suggests that 
the majority of producers would also be considered small entities 
according to the SBA's definition.
    The order regulates the handling of fresh citrus grown in the state 
of Florida. Total bearing citrus acreage has declined from a peak of 
approximately 800,000 acres in 1996-97 to about 550,000 acres in 2006-
07, largely due to hurricane damage and the removal of diseased citrus 
trees. Approximately 7.236 million tons of citrus were produced in 
Florida during the 2006-07 season--a decline of approximately 6 million 
tons compared to the 1996-97 season. According to evidence provided at 
the hearing, approximately 10 percent of Florida citrus is used in the 
fresh market, while the remainder is used in the production of 
processed juice products. Generally, 40 percent of Florida's fresh 
citrus is shipped to export markets, including the Pacific Rim 
countries, Europe, and Canada.
    Under the order, outgoing quality regulations are established for 
fresh citrus shipments, and statistical information is collected. 
Program activities administered by the committee are designed to 
support large and small citrus producers and handlers. The 18-member 
committee is comprised of both producer and handler representatives 
from the production area, as well as a public member. Committee 
meetings where regulatory recommendations and other decisions are made 
are open to the public. All members are able to participate in 
committee deliberations, and each committee member has an equal vote. 
Others in attendance at meetings are also allowed to express their 
views.
    After discussions within the citrus industry, the committee 
considered developing its own research and marketing promotion programs 
focusing on fresh Florida citrus. An amendment study subcommittee was 
formed to explore this idea and other possible order revisions. The 
subcommittee developed a list of proposed amendments to the order, 
which was then presented to the committee and shared with other 
industry organizations. The proposed amendments were also posted on the 
committee's Web site for review by the Florida citrus industry at 
large.
    The committee met to review and discuss the subcommittee's 
proposals at its meeting on May 29, 2007. At that time, the committee 
voted unanimously to support the four proposed amendments that were 
forwarded to AMS.
    In addition, the hearing to receive evidence on the proposed 
changes was open to the public and all interested parties were invited 
and encouraged to participate and provide their views.
    The amendments are intended to provide the committee and the 
industry with additional flexibility in administering the order and 
producing and marketing fresh Florida citrus. Record evidence indicates 
that the amendments are intended to benefit all producers and handlers 
under the order, regardless of size. All producer and handler witnesses 
supported the amendments at the hearing. Some witnesses commented on 
the implications of implementing specific marketing, research, and 
development programs. In that context, witnesses stated that they 
expected the benefits to producers and handlers to outweigh any 
potential costs.
    The amendment reducing the required number of cooperative producer 
and cooperative handler seats on the committee from three each to two 
each will have no economic impact on producers or handlers of any size. 
The number of cooperative entities in the industry has diminished 
considerably since the order's promulgation. Reducing the number of 
cooperative seats on the committee at this time will reflect the 
current composition of the industry. The reduction will help ensure 
that the interests of all large and small producers and handlers, 
whether independent or members of cooperatives, are represented 
appropriately during committee deliberations.
    Allowing substitute alternates to represent absent members at 
committee meetings, will have no adverse economic impact on producers 
or handlers of any size. Members who are unable to attend committee 
meetings will be allowed to designate available alternates to represent 
them if their own alternates are also unavailable in order to achieve a 
quorum. If members are unable to designate substitute alternates, the 
committee can designate substitutes at the meeting, if necessary to 
secure a quorum. Substitute alternates will be required to represent 
the same group affiliation (producer or handler) as the absent members 
and alternates. The amendment will allow alternates not otherwise 
representing absent members to represent other members at committee 
meetings in order to secure a quorum. This will help ensure that quorum 
requirements are met and that committee business is addressed in a 
timely manner.
    Adding authority to conduct committee meetings by telephone or 
other means of communication is expected to benefit producers and 
handlers of all sizes by improving committee efficiencies and 
encouraging greater participation in industry deliberations. It is not 
expected to result in any significant increased costs to producers or 
handlers. Using modern communication technology will allow the 
committee to respond more quickly to urgent industry needs and will 
provide greater access to meetings by members and other industry 
participants. Greater meeting flexibility will make it easier for the 
committee to hold additional meetings where there is a need for 
lengthier discussion and consensus building. These changes are 
consistent with current practices in other citrus industry settings.
    Adding authority to establish research and promotion programs will 
enable the committee to address the specific needs of the Florida fresh 
citrus industry by recommending, conducting, and funding research 
projects and promotional programs, including paid advertising, that 
focus on the production, handling, and marketing of fresh citrus.
    Hearing witnesses testified that the committee's assessment rate 
could increase to cover the costs of any newly authorized research and 
promotion projects, but that there may be an offset by decreases in 
payments by the industry to fund projects through other entities. Any 
increased assessment costs would be based on the volume of fresh

[[Page 46305]]

citrus shipped by each handler and would, therefore, be applied 
proportionately to all handlers.
    The benefits expected to accrue to producers and handlers following 
implementation of this amendment should outweigh the costs. Witnesses 
advocated the establishment of production research programs that would 
assist with the development of new varieties and post-harvest handling 
methods to improve the marketability of fresh Florida citrus. Marketing 
programs specific to fresh citrus are expected to increase consumer 
demand and sales, which should in turn increase returns to producers 
and handlers. Improved production and marketing strategies developed 
under the authorized programs are expected to outweigh any additional 
costs to the Florida fresh citrus industry. In addition, any increased 
costs would be proportional to a handler's size and would not unduly or 
disproportionately impact small entities. Witness support for this 
amendment was unanimous at the hearing.
    Interested persons were invited to present evidence at the hearing 
on the probable regulatory and informational impact of the proposed 
amendments to the order on small entities. The record evidence is that 
implementation of the amendments will have little or no impact on 
producers and handlers.
    USDA has not identified any relevant Federal rules that duplicate, 
overlap or conflict with this proposed rule. These amendments are 
intended to improve the operation and administration of the order and 
to assist in the marketing of fresh Florida citrus.

Paperwork Reduction Act

    Information collection requirements for Part 905 are currently 
approved by the Office of Management and Budget (OMB), under OMB Number 
0581-0189--``Generic OMB Fruit Crops.'' No changes in these 
requirements are anticipated as a result of these amendments. Should 
any such changes become necessary, they will be submitted to OMB for 
approval.
    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 Government Paperwork 
Elimination Act, which requires Government agencies in general to 
provide the public the option of submitting information or transacting 
business electronically to the maximum extent possible.
    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.

Civil Justice Reform

    The amendments to Marketing Order 905 as stated herein have been 
reviewed under Executive Order 12988, Civil Justice Reform. They are 
not intended to have retroactive effect.
    The Act provides that administrative proceedings must be exhausted 
before parties may file suit in court. Under section 608c(15)(A) of the 
Act, any handler subject to an order may file with 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. A 
handler is afforded the opportunity for a hearing on the petition. 
After the hearing, USDA would rule on the petition. The Act provides 
that the district court of the United States in any district in which 
the handler is an inhabitant, or has his or her principal place of 
business, has jurisdiction to review USDA's ruling on the petition, 
provided an action is filed no later than 20 days after the date of the 
entry of the ruling.

Order Amending the Order Regulating the Handling of Oranges, 
Grapefruit, Tangerines, and Tangelos Grown in Florida

Findings and Determinations

    The findings and determinations set forth hereinafter 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. 601-674) and the applicable rules of 
practice and procedure effective thereunder (7 CFR part 900), a public 
hearing was held upon the proposed amendments to Marketing Order No. 
905 (7 CFR part 905), regulating the handling of oranges, grapefruit, 
tangerines, and tangelos grown in Florida.
    Upon the basis of the evidence introduced at such hearing and the 
record thereof, it is found that:
    (1) The marketing order, as amended, and as hereby further amended, 
and all of the terms and conditions thereof, will tend to effectuate 
the declared policy of the Act;
    (2) The marketing order, as amended, and as hereby further amended, 
regulates the handling of oranges, grapefruit, tangerines, and tangelos 
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 order, as amended, and as hereby further amended, 
is 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 
subdivision of the production area would not effectively carry out the 
declared policy of the Act;
    (4) The marketing order, as amended, and as hereby further amended, 
prescribes, 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 
oranges, grapefruit, tangerines, and tangelos grown in the production 
area; and
    (5) All handling of oranges, grapefruit, tangerines, and tangelos 
grown in the production area is in the current of interstate or foreign 
commerce or directly burdens, obstructs, or affects such commerce.
    (b) Determinations. It is hereby determined that:

    (1) Handlers (excluding cooperative associations of producers who 
are not engaged in processing, distributing, or shipping oranges, 
grapefruit, tangerines, and tangelos covered by the order as hereby 
amended) who, during the period August 1, 2007 through July 31, 2008, 
handled 50 percent or more of the volume of such oranges, grapefruit, 
tangerines, and tangelos covered by said order, as hereby amended, have 
not signed an amended marketing agreement; and,
    (2) The issuance of this amendatory order, further amending the 
aforesaid order, is favored or approved by at least two-thirds of the 
producers who participated in a referendum on the question of approval 
and who, during the period of August 1, 2007 through July 31, 2008 
(which has been deemed to be a representative period), have been 
engaged within the production area in the production of such oranges, 
grapefruit, tangerines, and tangelos; and

[[Page 46306]]

    (3) In the absence of a signed marketing agreement, the issuance of 
this amendatory order is the only practical means pursuant to the 
declared policy of the Act of advancing the interests of producers of 
oranges, grapefruit, tangerines, and tangelos in the production area.

Order Relative to Handling of Oranges, Grapefruit, Tangerines, and 
Tangelos Grown in Florida

    It is therefore ordered, That on and after the effective date 
hereof, all handling of oranges, grapefruit, tangerines, and tangelos 
grown in Florida shall be in conformity to, and in compliance with, the 
terms and conditions of the said order as hereby amended as follows:
    The provisions of the proposed order further amending the order 
contained in the Secretary's Decision issued by the Administrator on 
April 6, 2009, and published in the Federal Register on April 13, 2009 
(74 FR 16798), shall be and are the terms and provisions of this order 
amending the order and set forth in full herein.

List of Subjects in 7 CFR Part 905

    Grapefruit, Marketing agreements, Oranges, Reporting and 
recordkeeping requirements, Tangelos, Tangerines.


0
For the reasons set forth in the preamble, Title 7, Chapter IX of the 
Code of Federal Regulations is amended by amending part 905 to read as 
follows:

PART 905--ORANGES, GRAPEFRUIT, TANGERINES, AND TANGELOS GROWN IN 
FLORIDA

0
1. The authority citation for 7 CFR part 905 continues to read as 
follows:

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


0
2. Amend Sec.  905.22 by revising paragraphs (a)(2) and (b)(2) to read 
as follows:


Sec.  905.22  Nominations.

    (a) * * *
    (2) Each nominee shall be a producer in the district from which he 
or she is nominated. In voting for nominees, each producer shall be 
entitled to cast one vote for each nominee in each of the districts in 
which he or she is a producer. At least two of the nominees and their 
alternates so nominated shall be affiliated with a bona fide 
cooperative marketing organization.
    (b) * * *
    (2) Nomination of at least two members and their alternates shall 
be made by bona fide cooperative marketing organizations which are 
handlers. Nominations for not more than six members and their 
alternates shall be made by handlers who are not so affiliated. In 
voting for nominees, each handler or his or her authorized 
representative shall be entitled to cast one vote, which shall be 
weighted by the volume of fruit by such handler during the then current 
fiscal period.

0
3. Revise Sec.  905.23 to read as follows:


Sec.  905.23  Selection.

    (a) From the nominations made pursuant to Sec.  905.22(a) or from 
other qualified persons, the Secretary shall select one member and one 
alternate member to represent District 2 and two members and two 
alternate members each to represent Districts 1, 3, 4, and 5 or such 
other number of members and alternate members from each district as may 
be prescribed pursuant to Sec.  905.14. At least two such members and 
their alternates shall be affiliated with bona fide cooperative 
marketing organizations.
    (b) From the nominations made pursuant to Sec.  905.22(b) or from 
other qualified persons, the Secretary shall select at least two 
members and their alternates to represent bona fide cooperative 
marketing organizations which are handlers, and the remaining members 
and their alternates to represent handlers who are not so affiliated.

0
4. In Sec.  905.29, redesignate paragraph (b) as paragraph (c), and add 
a new paragraph (b) to read as follows:


Sec.  905.29  Inability of members to serve.

* * * * *
    (b) If both a member and his or her respective alternate are unable 
to attend a committee meeting, such member may designate another 
alternate to act in his or her place in order to obtain a quorum: 
Provided, That such alternate member represents the same group 
affiliation as the absent member. If the member is unable to designate 
such an alternate, the committee members present may designate such 
alternate.
* * * * *

0
5. Revise paragraph (c) of Sec.  905.34 to read as follows:


Sec.  905.34  Procedure of committees.

* * * * *
    (c) The committee may provide for meeting by telephone, telegraph, 
or other means of communication, and any vote cast at such a meeting 
shall be promptly confirmed in writing: Provided, That if any assembled 
meeting is held, all votes shall be cast in person.
* * * * *

0
6. Add a new Sec.  905.54 to read as follows:


Sec.  905.54  Marketing, research and development.

    The committee may, with the approval of the Secretary, establish, 
or provide for the establishment of, projects including production 
research, marketing research and development projects, and marketing 
promotion including paid advertising, designed to assist, improve, or 
promote the marketing, distribution, and consumption or efficient 
production of fruit. The expenses of such projects shall be paid by 
funds collected pursuant to Sec.  905.41. Upon conclusion of each 
project, but at least annually, the committee shall summarize the 
program status and accomplishments to its members and the Secretary. A 
similar report to the committee shall be required of any contracting 
party on any project carried out under this section. Also, for each 
project, the contracting party shall be required to maintain records of 
money received and expenditures, and such shall be available to the 
committee and the Secretary.

    Dated: September 2, 2009.
Rayne Pegg,
Administrator, Agricultural Marketing Service.
[FR Doc. E9-21656 Filed 9-8-09; 8:45 am]
BILLING CODE 3410-02-P