Onions Grown in South Texas; Increased Assessment Rate, 23671-23673 [2013-09381]

Agencies

• Agricultural Marketing Service
• DEPARTMENT OF AGRICULTURE

[Federal Register Volume 78, Number 77 (Monday, April 22, 2013)]
[Rules and Regulations]
[Pages 23671-23673]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-09381]



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Federal Register / Vol. 78, No. 77 / Monday, April 22, 2013 / Rules 
and Regulations

[[Page 23671]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 959

[Doc. No. AMS-FV-12-0039; FV12-959-1 FR]


Onions Grown in South Texas; Increased Assessment Rate

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

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SUMMARY: This rule increases the assessment rate established for the 
South Texas Onion Committee (Committee) for the 2012-13 and subsequent 
fiscal periods from $0.025 to $0.03 per 50-pound equivalent of onions 
handled. The Committee locally administers the marketing order that 
regulates the handling of onions grown in South Texas. Assessments upon 
onion 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 will remain in effect 
indefinitely unless modified, suspended, or terminated.

DATES: Effective Date: April 23, 2013.

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 Jeffrey Smutny, 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: Jeffrey.Smutny@ams.usda.gov.

SUPPLEMENTARY INFORMATION: This rule is issued under Marketing Order 
No. 959, as amended (7 CFR part 959), regulating the handling of onions 
grown in South 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 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, South Texas 
onion handlers are subject to assessments. Funds to administer the 
order are derived from such assessments. It is intended that the 
assessment rate as issued herein will be applicable to all assessable 
onions 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 increases the assessment rate established for the 
Committee for the 2012-13 and subsequent fiscal periods from $0.025 to 
$0.03 per 50-pound equivalent of onions handled.
    The South Texas 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 
South Texas 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 2009-10 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 based upon a recommendation and 
information submitted by the Committee or other information available 
to USDA.
    The Committee met on June 26, 2012, and unanimously recommended 
2012-13 expenditures of $145,467 and an assessment rate of $0.03 per 
50-pound equivalent of onions. In comparison, last year's budgeted 
expenditures were $190,467. The assessment rate of $0.03 is $0.005 
higher than the rate currently in effect. The Committee's 2012-13 crop 
estimate of five million 50-pound equivalents is lower than the six 
million estimated for last year, and would not generate adequate 
assessment income to cover budgeted expenses at the $0.025 rate. With 
the recommended $0.005 increase, assessment income should approximate 
$150,000. The increased assessment rate should provide sufficient funds 
to cover anticipated 2012-13 expenses.
    The major expenditures recommended by the Committee for the 2012-13 
fiscal period include $46,610 for compliance, $37,050 for 
administration, and $32,942 for management. Budgeted expenses for these 
items were the same in 2011-12. The reduction in overall budgeted 
expenses from $190,467 to $145,467 is due to the elimination of market 
development programs.
    The assessment rate recommended by the Committee was derived by 
dividing anticipated expenses by expected shipments of South Texas 
onions. Onion shipments for the year are estimated at five million 50-
pound equivalents, which should provide $150,000 in assessment income. 
Income derived from handler assessments, along

[[Page 23672]]

with interest income, should be adequate to cover budgeted expenses. 
Funds in the reserve (currently $107,162) will be kept within the 
maximum permitted by the order (approximately two fiscal periods' 
expenses as stated in Sec.  959.43).
    The assessment rate established in this rule will continue in 
effect indefinitely unless modified, suspended, or terminated by USDA 
based upon a recommendation and information submitted by the Committee 
or other available information.
    Although this assessment rate will be in effect for an indefinite 
period, the Committee will 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 will evaluate Committee 
recommendations and other available information to determine whether 
modification of the assessment rate is needed. Further rulemaking will 
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.

Final 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 final 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 85 producers of onions in the production 
area and approximately 30 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 (NASS), the average price for South 
Texas onions during the 2010-11 season was around $7.35 per 50-pound 
equivalents and total shipments were approximately 5.4 million 50-pound 
equivalents. Using the average price and shipment information and 
assuming a normal distribution, the majority of South Texas onion 
producers would have annual receipts of less than $750,000. In 
addition, based on available information, approximately 80 percent 
South Texas onion handlers could be considered small businesses under 
SBA's definition. Thus, the majority of South Texas onion producers and 
handlers may be classified as small entities.
    This rule increases the assessment rate established for the 
Committee and collected from handlers for the 2012-13 and subsequent 
fiscal periods from $0.025 to $0.03 per 50-pound equivalent of onions. 
The Committee unanimously recommended 2012-13 expenditures of $145,467 
and an assessment rate of $0.03 per 50-pound equivalent. The assessment 
rate of $0.03 is $0.005 higher than the 2011-12 rate. The quantity of 
assessable onions for the 2012-13 fiscal period is estimated at five 
million 50-pound equivalents, compared to an estimated six million 50-
pound equivalents last year. The current assessment rate of $0.025 
would not generate sufficient revenue to meet expenses, however the 
$0.03 rate should provide $150,000 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 $46,610 for compliance, $37,050 for 
administration, and $32,942 for management. Budgeted expenses for these 
items were the same in 2011-12. The reduction in overall budgeted 
expenses from $190,467 to $145,467 is due to the elimination of market 
development programs.
    Prior to arriving at this budget, the Committee considered 
information from various sources, such as the Committee's Budget and 
Personnel Committee and the Marketing Committee. Alternative 
expenditure levels were discussed by these groups, based upon the 
relative value of various promotional projects to the South Texas onion 
industry. The assessment rate of $0.03 per 50-pound equivalent of 
assessable onions was then determined by dividing the total recommended 
budget by the quantity of assessable onions, estimated at five million 
50-pound equivalents for the 2012-13 fiscal period. Assessment income 
should approximate $150,000, $5,333 above 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 fiscal period could range between $6.60 and $9.80 
per 50-pound equivalent of onions. Therefore, the estimated assessment 
revenue for the 2012-13 fiscal period, as a percentage of total grower 
revenue, could range between .3 and .45 percent.
    This action increases 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 
are offset by the benefits derived by the operation of the marketing 
order. In addition, the Committee's meeting was widely publicized 
throughout the South Texas 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 June 26, 
2012, meeting was a public meeting and all entities, both large and 
small, were able to express views on this issue.
    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. 0581-0178, Vegetable and Specialty 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 rule imposes no additional reporting or recordkeeping 
requirements on either small or large South Texas 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. As noted in the 
initial regulatory flexibility analysis, USDA has not identified any 
relevant Federal rules that duplicate, overlap, or conflict with this 
final rule.
    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.
    A proposed rule concerning this action was published in the Federal

[[Page 23673]]

Register on February 5, 2013 (78 FR 8047). Copies of the proposed rule 
were also mailed or sent via facsimile to all onion handlers. Finally, 
the proposal was made available through the Internet by USDA and the 
Office of the Federal Register. A 10-day comment period ending February 
15, 2013, was provided for interested persons to respond to the 
proposal. No comments were received.
    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 Jeffrey Smutny at the previously 
mentioned address in the FOR FURTHER INFORMATION CONTACT section.
    After consideration of all relevant material presented, including 
the information and recommendation submitted by the Committee and other 
available information, it is hereby found that this rule, as 
hereinafter set forth, will tend to effectuate the declared policy of 
the Act.
    Pursuant to 5 U.S.C. 553, it is also found and determined that good 
cause exists for not postponing the effective date of this rule until 
30 days after publication in the Federal Register because the 2012-13 
fiscal period began on August 1, 2012, and the marketing order requires 
that the assessment rate for each fiscal period apply to all assessable 
onions handled during such fiscal period. In addition, the Committee 
needs sufficient funds to pay its expenses, which are incurred on a 
continuous basis. Further, handlers are aware of this rule which was 
recommended at a public meeting. Also, a 10-day comment period was 
provided for in the proposed rule, and no comments were received.

List of Subjects in 7 CFR Part 959

    Marketing agreements, Onions, Reporting and recordkeeping 
requirements.

    For the reasons set forth in the preamble, 7 CFR part 959 is 
amended as follows:

PART 959--ONIONS GROWN IN SOUTH TEXAS

0
1. The authority citation for 7 CFR part 959 continues to read as 
follows:

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

0
2. Section 959.237 is revised to read as follows:


Sec.  959.237  Assessment rate.

    On and after August 1, 2012, an assessment rate of $0.03 per 50-
pound equivalent is established for South Texas onions.

    Dated: April 16, 2013.
David R. Shipman,
Administrator, Agricultural Marketing Service.
[FR Doc. 2013-09381 Filed 4-19-13; 8:45 am]
BILLING CODE 3410-02-P