Oranges and Grapefruit Grown in the Lower Rio Grande Valley in Texas; Decreased Assessment Rate, 57164-57166 [2017-25737]

Agencies

• Agricultural Marketing Service
• DEPARTMENT OF AGRICULTURE

[Federal Register Volume 82, Number 231 (Monday, December 4, 2017)]
[Proposed Rules]
[Pages 57164-57166]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-25737]


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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. 82, No. 231 / Monday, December 4, 2017 / 
Proposed Rules

[[Page 57164]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 906

[Doc. No. AMS-SC-17-0037; SC17-906-1 PR]


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

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule.

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SUMMARY: This proposed rule would implement a recommendation from the 
Texas Valley Citrus Committee (Committee) to decrease the assessment 
rate established for the 2017-18 and subsequent fiscal periods from 
$0.09 to $0.02 per 7/10-bushel carton or equivalent of oranges and 
grapefruit handled under the Marketing Order (Order). The assessment 
rate would remain in effect indefinitely unless modified, suspended, or 
terminated. This proposed rule also makes administrative revisions to 
the subpart headings to bring the language into conformance with the 
Office of Federal Register requirements.

DATES: Comments must be received by January 3, 2018.

ADDRESSES: Interested persons are invited to submit written comments 
concerning this proposed rule. Comments must be sent to the Docket 
Clerk, Marketing Order and Agreement Division, Specialty Crops 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 
proposed 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, Specialty Crops 
Program, AMS, USDA; Telephone: (863) 324-3375, Fax: (863) 291-8614, 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 Richard Lower, Marketing Order and Agreement 
Division, Specialty Crops Program, AMS, USDA, 1400 Independence Avenue 
SW., STOP 0237, Washington, DC 20250-0237; Telephone: (202) 720-2491, 
Fax: (202) 720-8938, or Email: Richard.Lower@ams.usda.gov.

SUPPLEMENTARY INFORMATION: This action, pursuant to 5 U.S.C. 553, 
proposes an amendment to regulations issued to carry out a marketing 
order as defined in 7 CFR 900.2(j). This proposal 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. Part 906, (hereinafter referred to as 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 Committee locally administers the Order and is comprised 
of producers and handlers of oranges and grapefruit operating within 
the production area.
    The Department of Agriculture (USDA) is issuing this proposed rule 
in conformance with Executive Orders 13563 and 13175. This action falls 
within a category of regulatory actions that the Office of Management 
and Budget (OMB) exempted from Executive Order 12866 review. 
Additionally, because this proposal does not meet the definition of a 
significant regulatory action, it does not trigger the requirements 
contained in Executive Order 13771. See OMB's Memorandum titled 
``Interim Guidance Implementing Section 2 of the Executive Order of 
January 30, 2017, titled `Reducing Regulation and Controlling 
Regulatory Costs'[thinsp]'' (February 2, 2017).
    This proposed rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. Under the Marketing Order now in effect, Texas 
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 will be applicable to all assessable oranges 
and grapefruit beginning on August 1, 2017, 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 proposed rule would decrease the assessment rate for the 2017-
18 and subsequent fiscal periods from $0.09 to $0.02 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 of 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

[[Page 57165]]

opportunity to participate and provide input.
    For the 2016-17 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 August 8, 2017, and unanimously recommended 
2017-18 expenditures of $152,920 and an assessment rate of $0.02 per 7/
10-bushel carton or equivalent of oranges and grapefruit. In 
comparison, last year's budgeted expenditures were $751,148. The 
assessment rate of $0.02 is $0.07 lower than the rate currently in 
effect. The Committee recommended decreasing the assessment rate to 
reflect that they would not be funding the Mexican fruit fly control 
program, reducing their budget by more than $595,000.
    The major expenditures recommended by the Committee for the 2017-18 
year include $79,220 for management, $50,000 for compliance, and 
$23,700 for operating expenses. Budgeted expenses for these items in 
2016-17 were $77,200, $50,000, and $23,700, respectively.
    The assessment rate recommended by the Committee was derived by 
considering anticipated expenses, expected shipments of 7.5 million 7/
10-bushel cartons, and the amount of funds available in the authorized 
reserve. Income derived from handler assessments calculated at $150,000 
(7.5 million x $0.02), along with interest income and funds from the 
Committee's authorized reserve, would be adequate to cover budgeted 
expenses of $152,920. Funds in the reserve (currently $282,572) would 
be kept within the maximum permitted by the Order (approximately one 
fiscal period's expenses as stated in Sec.  906.35).
    The assessment rate recommended in this proposed rule 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 effective 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 would 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 2017-18 budget and those 
for subsequent fiscal periods will be reviewed and, as appropriate, 
approved by USDA.
    This proposed rule also makes administrative revisions to the 
subpart headings of the regulations.

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 proposed 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 
businesses 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 13 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 $7,500,000 (13 CFR 121.201).
    According to Committee data, the average price for Texas citrus 
during the 2015-16 season was approximately $17.48 per box and total 
shipments were 7.5 million boxes. Using the average price and shipment 
information, the number of handlers (13), and assuming a normal 
distribution, the majority of handlers would have average annual 
receipts of greater than $7,500,000. Thus, the majority of Texas citrus 
handlers may be classified as large business entities.
    In addition, based on information from the National Agricultural 
Statistics Service, the weighted grower price for Texas citrus during 
the 2015-16 season was approximately $14.64 per box. Using the weighted 
average price and shipment information, and assuming a normal 
distribution, the majority of producers would have annual receipts of 
less than $750,000. Thus, the majority of Texas citrus producers may be 
classified as small business entities.
    This proposal would decrease the assessment rate collected from 
handlers for the 2017-18 and subsequent fiscal periods from $0.09 to 
$0.02 per 7/10-bushel carton or equivalent of Texas citrus. The 
Committee unanimously recommended 2017-18 expenditures of $152,920 and 
an assessment rate of $0.02 per 7/10-bushel carton or equivalent 
handled. The assessment rate of $0.02 is $0.07 lower than the 2016-17 
rate. The quantity of assessable oranges and grapefruit for the 2017-18 
fiscal period is estimated at 7.5 million 7/10-bushel cartons. Thus, 
the $0.02 rate should provide $150,000 in assessment income (7.5 
million x $0.02). Income derived from handler assessments, along with 
interest income and funds from the Committee's authorized reserve 
(currently $282,572), would be adequate to cover budgeted expenses.
    The major expenditures recommended by the Committee for the 2017-18 
year include $79,220 for management, $50,000 for compliance, and 
$23,700 for operating expenses. Budgeted expenses for these items in 
2016-17 were $77,200, $50,000, and $23,700, respectively.
    The Committee recommended decreasing the assessment rate to reflect 
that it would not be funding the Mexican fruit fly control program, 
reducing its budget by more than $595,000.
    Prior to arriving at this budget and assessment rate, the Committee 
considered information from various sources, such as the Committee's 
Budget and Personnel Committee, and the Research Committee. Alternative 
expenditure levels were discussed by these committees who reviewed the 
relative value of various activities to the Texas citrus industry. 
These committees determined that all program activities were adequately 
funded and essential to the functionality of the Order, thus no 
alternate expenditure levels were deemed appropriate. Additionally, 
alternate assessment rates of $0.01 and $0.015 per 7/10 bushel-carton 
were discussed. However, it was determined that these lower assessment 
rates would draw too heavily from reserves, roughly $78,000 and 
$43,000, respectively. The proposed rate of $0.02 per 7/10 bushel-
carton would draw an anticipated $2,800 from reserves, thereby leaving 
reserves intact for future needs.
    Based on these discussions and estimated shipments, the recommended 
assessment rate of $0.02 would provide $150,000 in assessment income. 
The

[[Page 57166]]

Committee determined that assessment revenue, along with funds from 
reserves and interest income, would be adequate to cover budgeted 
expenses for the 2017-18 fiscal period.
    A review of historical information and preliminary information 
pertaining to the upcoming fiscal period indicates that the average 
grower price for the 2017-18 season should be approximately $15.50 per 
7/10-bushel carton or equivalent of oranges and grapefruit. Therefore, 
the estimated assessment revenue for the 2017-18 crop year as a 
percentage of total grower revenue would be about 0.1 percent.
    This proposed rule would decrease the assessment obligation imposed 
on handlers. Assessments are applied uniformly on all handlers, and 
some of the costs may be passed on to producers. However, decreasing 
the assessment rate reduces the burden on handlers and may also reduce 
the burden on producers.
    The Committee's meeting was widely publicized throughout the Texas 
citrus industry. All interested persons were invited to attend the 
meeting and participate in Committee deliberations on all issues. Like 
all Committee meetings, the August 8, 2017, 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.
    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 OMB and assigned OMB No. 0581-0189, Fruit 
Crops. No changes in those requirements would be necessary as a result 
of this proposed rule. Should any changes become necessary, they would 
be submitted to OMB for approval.
    This proposed rule would not impose any 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: https://www.ams.usda.gov/rules-regulations/moa/small-businesses. Any questions 
about the compliance guide should be sent to Richard Lower 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 proposal. Thirty days is deemed appropriate since the 
fiscal period began August 1, 2017, and the Order requires that the 
rate of assessment apply to all assessable oranges and grapefruit 
handled during such fiscal period. All written comments timely received 
will be considered before a final determination is made on this rule.

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 
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.

[Subpart Redesignated as Subpart A]

0
2. Redesignate ``Subpart--Order Regulating Handling'' as ``Subpart A--
Order Regulating Handling.''

[Subpart Redesignated as Subpart B and Amended]

0
 3. Redesignate ``Subpart--Rules and Regulations'' as Subpart B and 
revise heading to read as follows:

Subpart B--Administrative Requirements

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


Sec.  906.235  Assessment rate.

    On and after August 1, 2017, an assessment rate of $0.02 per 7/10-
bushel carton or equivalent is established for oranges and grapefruit 
grown in the Lower Rio Grande Valley in Texas.

[Subpart Redesignated as Subpart C]

0
5. Redesignate ``Subpart--Container and Pack Requirements'' as 
``Subpart C--Container and Pack Requirements.''

    Dated: November 22, 2017.
Bruce Summers,
Acting Administrator, Agricultural Marketing Service.
[FR Doc. 2017-25737 Filed 12-1-17; 8:45 am]
 BILLING CODE 3410-02-P