Oranges and Grapefruit Grown in Lower Rio Grande Valley in Texas; Increased Assessment Rate, 1763-1765 [2013-00189]

Agencies

• Agricultural Marketing Service
• DEPARTMENT OF AGRICULTURE

[Federal Register Volume 78, Number 6 (Wednesday, January 9, 2013)]
[Proposed Rules]
[Pages 1763-1765]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-00189]


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Proposed Rules
                                                Federal Register
________________________________________________________________________

This section of the FEDERAL REGISTER contains notices to the public of 
the proposed issuance of rules and regulations. The purpose of these 
notices is to give interested persons an opportunity to participate in 
the rule making prior to the adoption of the final rules.

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Federal Register / Vol. 78, No. 6 / Wednesday, January 9, 2013 / 
Proposed Rules

[[Page 1763]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 906

[Doc. No. AMS-FV-12-0038; FV12-906-1 PR]


Oranges and Grapefruit Grown in Lower Rio Grande Valley in Texas; 
Increased Assessment Rate

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule.

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SUMMARY: This proposed rule would increase the assessment rate 
established for the Texas Valley Citrus Committee (Committee) for the 
2012-13 and subsequent fiscal periods from $0.14 to $0.16 per 7/10-
bushel carton or equivalent of oranges and grapefruit handled. The 
Committee locally administers the marketing order which regulates the 
handling of oranges and grapefruit grown in the Lower Rio Grande Valley 
in Texas (order). Assessments upon orange and grapefruit handlers are 
used by the Committee to fund reasonable and necessary expenses of the 
program. The fiscal period begins August 1 and ends July 31. The 
assessment rate would remain in effect indefinitely unless modified, 
suspended, or terminated.

DATES: Comments must be received by January 22, 2013.

ADDRESSES: Interested persons are invited to submit written comments 
concerning this rule. Comments must be sent to the Docket Clerk, 
Marketing Order and Agreement Division, Fruit and Vegetable Program, 
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 document 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. All comments submitted in response to this rule 
will be included in the record and will be made available to the 
public. Please be advised that the identity of the individuals or 
entities submitting the comments will be made public on the Internet at 
the address provided above.

FOR FURTHER INFORMATION CONTACT: Doris Jamieson, Marketing Specialist 
or Christian D. Nissen, Regional Director, Southeast Marketing Field 
Office, Marketing Order and Agreement Division, Fruit and Vegetable 
Program, AMS, USDA; Telephone: (863) 324-3375, Fax: (863) 325-8793, or 
Email: Doris.Jamieson@ams.usda.gov or Christian.Nissen@ams.usda.gov.
    Small businesses may request information on complying with this 
regulation by contacting Laurel May, Marketing Order and Agreement 
Division, Fruit and Vegetable Program, AMS, USDA, 1400 Independence 
Avenue SW., STOP 0237, Washington, DC 20250-0237; Telephone: (202) 720-
2491, Fax: (202) 720-8938, or Email: Laurel.May@ams.usda.gov.

SUPPLEMENTARY INFORMATION: This proposed rule is issued under Marketing 
Agreement and Order No. 906, as amended (7 CFR part 906), regulating 
the handling of oranges and grapefruit grown in the Lower Rio Grande 
Valley in Texas, 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 proposed rule 
in conformance with Executive Order 12866.
    This proposed rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. Under the marketing order now in effect, orange 
and grapefruit 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 oranges and grapefruit beginning on August 1, 2012, and 
continue until amended, suspended, or terminated.
    The Act provides that administrative proceedings must be exhausted 
before parties may file suit in court. Under section 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 2012-13 and subsequent fiscal periods from $0.14 to 
$0.16 per 7/10-bushel carton or equivalent of oranges and grapefruit 
handled.
    The Texas orange and grapefruit 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 
Texas oranges and grapefruit. 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 2011-12 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 June 5, 2012, and unanimously recommended 
2012-13 expenditures of $1,340,800 and an assessment rate of $0.16 per 
7/10-bushel carton or equivalent of oranges and grapefruit handled. In 
comparison, last year's budgeted expenditures were $1,273,537. The 
assessment rate of $0.16 is $0.02 higher than the rate currently in 
effect. The increased assessment rate

[[Page 1764]]

should generate sufficient income to cover anticipated expenses, 
including an increase in advertising and promotion, as well as allow 
the Committee to replenish funds in its reserves.
    The major expenditures recommended by the Committee for the 2012-13 
fiscal period include $575,000 for promotion; $489,500 for the Mexican 
fruit fly control program; and $243,000 for management, administration, 
and compliance. Budgeted expenses for these items in 2011-12 were 
$425,000, $564,500, and $250,737, respectively.
    The assessment rate recommended by the Committee was derived by 
dividing anticipated expenses by expected shipments of Texas oranges 
and grapefruit. Orange and grapefruit shipments for the 2012-13 fiscal 
period are estimated at 8.5 million 7/10-bushel cartons or equivalent, 
which should provide $1,360,000 in assessment income. Income derived 
from handler assessments would be adequate to cover budgeted expenses. 
Funds in the reserve (currently $78,090) would be kept within the 
maximum permitted by the order (approximately one fiscal period's 
expenses as stated in Sec.  906.35).
    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 2012-13 budget and those 
for subsequent fiscal periods would be reviewed and, as appropriate, 
approved by USDA.

Initial Regulatory Flexibility Analysis

    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA) (5 U.S.C. 601-612), 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 170 producers of oranges and grapefruit in 
the production area and 15 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 are defined as those 
whose annual receipts are less than $7,000,000 (13 CFR 121.201).
    According to Committee data and information from the National 
Agricultural Statistical Service, the weighted average grower price for 
Texas citrus during the 2010-11 season was around $11.30 per box and 
total shipments were near 4.7 million boxes. Using the weighted average 
price and shipment information, and assuming a normal distribution, the 
majority of growers would have annual receipts of less than $750,000. 
In addition, based on available information, approximately 60 percent 
of Texas citrus handlers could be considered small businesses under 
SBA's definition. Thus, the majority of producers and handlers of Texas 
citrus may be classified as small entities.
    This proposed rule would increase the assessment rate established 
for the Committee and collected from handlers for the 2012-13 and 
subsequent fiscal periods from $0.14 to $0.16 per 7/10-bushel carton or 
equivalent of Texas oranges and grapefruit. The Committee unanimously 
recommended 2012-13 expenditures of $1,340,800 and an assessment rate 
of $0.16 per 7/10-bushel carton or equivalent handled. The proposed 
assessment rate of $0.16 is $0.02 higher than the 2011-12 rate. The 
quantity of assessable oranges and grapefruit for the 2012-13 fiscal 
period is estimated at 8.5 million 7/10-bushel cartons or equivalent. 
Thus, the $0.16 rate should provide $1,360,000 in assessment income and 
be adequate to meet this year's expenses.
    The major expenditures recommended by the Committee for the 2012-13 
fiscal period include $575,000 for promotion; $489,500 for the Mexican 
fruit fly control program; and $243,000 for management, administration, 
and compliance. Budgeted expenses for these items in 2011-12 were 
$425,000, $564,500, and $250,737, respectively.
    The Committee reviewed and unanimously recommended 2012-13 
expenditures of $1,340,800, which included increases in promotional 
activities. The Committee considered proposed expenses and recommended 
increasing the assessment rate to cover the increase in the advertising 
and promotion program, as well as to allow the Committee to replenish 
funds in its reserve.
    Prior to arriving at this budget, the Committee considered 
information from various sources, such as the Committee's Budget and 
Personnel Committee, and the Market Development Committee. Alternative 
expenditure levels were discussed by these groups, based upon the 
relative value of various research and promotion projects to the Texas 
citrus industry. The assessment rate of $0.16 per 7/10-bushel carton or 
equivalent of assessable oranges and grapefruit was then determined by 
dividing the total recommended budget by the quantity of assessable 
oranges and grapefruit, estimated at 8.5 million 7/10-bushel cartons or 
equivalent for the 2012-13 fiscal period. This is approximately $20,700 
above 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 2012-13 season could range between $8.98 and $16.35 per 
7/10-bushel carton or equivalent of oranges and grapefruit. Therefore, 
the estimated assessment revenue for the 2012-13 fiscal period as a 
percentage of total grower revenue could range between 1 and 2 percent.
    This proposed 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 Texas citrus industry and all interested persons were 
invited to attend the meeting and participate in Committee 
deliberations on all issues. Like all Committee meetings, the June 5, 
2012, 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

[[Page 1765]]

comments on this proposed rule, including the regulatory and 
informational impacts of this action on small businesses.
    In accordance with the Paperwork Reduction Act of 1995, (44 U.S.C. 
Chapter 35), the order's information collection requirements have been 
previously approved by the Office of Management and Budget (OMB) and 
assigned OMB No. 0581-0189 Generic Fruit Crops. No changes in those 
requirements as a result of this action are necessary. Should any 
changes become necessary, they would be submitted to OMB for approval.
    This proposed rule would impose no additional reporting or 
recordkeeping requirements on either small or large Texas orange and 
grapefruit 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: 
www.ams.usda.gov/MarketingOrdersSmallBusinessGuide. Any questions about 
the compliance guide should be sent to Laurel May at the previously-
mentioned address in the FOR FURTHER INFORMATION CONTACT section.
    A 10-day comment period is provided to allow interested persons to 
respond to this proposed rule. Ten days is deemed appropriate because: 
(1) The 2012-13 fiscal period began on August 1, 2012, and the 
marketing order requires that the rate of assessment for each fiscal 
period apply to all assessable oranges and grapefruit 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 assessment 
rate actions issued in past years.

List of Subjects in 7 CFR Part 906

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

    For the reasons set forth in the preamble, 7 CFR part 906 is 
proposed to be amended as follows:

PART 906--ORANGES AND GRAPEFRUIT GROWN IN LOWER RIO GRANDE VALLEY 
IN TEXAS

0
1. The authority citation for 7 CFR part 906 continues to read as 
follows:

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

0
2. Section 906.235 is revised to read as follows:


Sec.  906.235  Assessment rate.

    On and after August 1, 2012, an assessment rate of $0.16 per 7/10-
bushel carton or equivalent is established for oranges and grapefruit 
grown in the Lower Rio Grande Valley in Texas.

    Dated: January 3, 2013.
David R. Shipman,
Administrator, Agricultural Marketing Service.
[FR Doc. 2013-00189 Filed 1-8-13; 8:45 am]
BILLING CODE P