80 FR 73640 - Onions Grown in South Texas; Increased Assessment Rate

DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service

Federal Register Volume 80, Issue 227 (November 25, 2015)

This rule implements a recommendation from the South Texas Onion Committee (Committee) to increase the assessment rate established for the 2015-16 and subsequent fiscal periods from $0.03 to $0.05 per 50-pound equivalent of onions handled under the marketing order (order). The Committee locally administers the order and is comprised of producers and handlers of onions operating within the area of production. 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.

[Federal Register Volume 80, Number 227 (Wednesday, November 25, 2015)]
[Rules and Regulations]
[Pages 73640-73642]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2015-30020]



[[Page 73640]]

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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 959

[Doc. No. AMS-FV-15-0036; FV15-959-1 FR]


Onions Grown in South Texas; Increased Assessment Rate

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

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SUMMARY: This rule implements a recommendation from the South Texas 
Onion Committee (Committee) to increase the assessment rate established 
for the 2015-16 and subsequent fiscal periods from $0.03 to $0.05 per 
50-pound equivalent of onions handled under the marketing order 
(order). The Committee locally administers the order and is comprised 
of producers and handlers of onions operating within the area of 
production. 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 November 27, 2015.

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: [email protected] or [email protected].
    Small businesses may request information on complying with this 
regulation by contacting Jeffrey Smutny, 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: [email protected].

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 Orders 12866, 13563, and 13175.
    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 August 1, 2015, 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 by the 
Committee for the 2015-16 and subsequent fiscal periods from $0.03 to 
$0.05 per 50-pound equivalent of onions.
    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 2012-13 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 25, 2015, and unanimously recommended 
2015-16 expenditures of $149,807 and an assessment rate of $0.05 per 
50-pound equivalent of onions. Budgeted expenditures for the 2014-15 
fiscal period were the same. The assessment rate of $0.05 is $0.02 
higher than the rate currently in effect. With the 2015-16 crop 
estimated to be four million 50-pound equivalents, one million less 
than last year's estimate, the current assessment rate would be 
insufficient to cover the Committee's anticipated expenditures. 
Further, due to a crop failure during the 2014-15 season, the Committee 
has depleted its reserve funds. With the Committee's recommended $0.02 
increase, assessment income should approximate $200,000. This should 
provide sufficient funds to cover anticipated 2015-16 expenses and add 
funds to the Committee's authorized reserve.
    The major expenditures recommended by the Committee for the 2015-16 
year include $50,000 for compliance, $37,050 for administrative, and 
$32,942 for management. Budgeted expenses for these items were the same 
in 2014-15.
    The assessment rate recommended by the Committee was derived by 
considering anticipated expenses, expected shipments of South Texas 
onions, and the level of funds in reserve. As mentioned earlier, onion 
shipments for the year are estimated at four million 50-pound 
equivalents which should provide $200,000 in assessment income. Income 
derived from handler assessments, along with interest income, should be 
adequate to cover budgeted expenses. Funds in the reserve (currently 
$23,906) will be kept within the maximum permitted by the order 
(approximately two fiscal periods' expenses as authorized in Sec.  
959.43).
    The assessment rate established in this rule will 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 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

[[Page 73641]]

needed. Further rulemaking will be undertaken as necessary. The 
Committee's 2015-16 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 
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 60 producers of onions in the production 
area and approximately 20 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 2013-2014 season was around $12.00 per 50-pound 
equivalent and total shipments were approximately 4.4 million 50-pound 
equivalents. Based on this information and data on acreage and yield, 
the majority of South Texas onion producers would have annual receipts 
of less than $750,000. In addition, based on available information, 
more than 50 percent of 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 2015-16 and subsequent 
fiscal periods from $0.03 to $0.05 per 50-pound equivalent of Texas 
onions. The Committee unanimously recommended 2015-16 expenditures of 
$149,807 and an assessment rate of $0.05 per 50-pound equivalent. The 
assessment rate of $0.05 is $0.02 higher than the 2012-13 rate. The 
quantity of assessable onions for the 2015-16 fiscal period is 
estimated at four million 50-pound equivalents. Thus, the $0.05 rate 
should provide $200,000 in assessment income and be adequate to meet 
this year's expenses.
    The major expenditures recommended by the Committee for the 2015-16 
fiscal period include $50,000 for compliance, $37,050 for 
administrative, and $32,942 for management. Budgeted expenses for these 
items were the same during the 2014-15 fiscal period.
    With the 2015-16 crop estimated to be four million 50-pound 
equivalents, one million less than last year's estimate, the current 
assessment rate would be insufficient to cover the Committee's 
anticipated expenditures. Further, due to a crop failure during the 
2014-15 season, the Committee has depleted its reserve funds. The 
Committee recommended the $0.02 increase to provide sufficient funds to 
cover anticipated 2015-16 expenses and add funds to the Committee's 
authorized reserve.
    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. Alternative expenditure levels were 
discussed by this group, based upon the relative value of various 
activities to the South Texas onion industry. The Committee ultimately 
determined that 2015-16 expenditures of $149,807 were appropriate, and 
the recommended assessment rate, along with interest income, would 
generate sufficient revenue to meet its expenses.
    A review of historical information and preliminary information 
pertaining to the upcoming season indicates that the grower price for 
the 2015-16 season should average around $9.55 per 50-pound equivalent 
of onions. Therefore, the estimated assessment revenue for the 2015-16 
fiscal period as a percentage of total grower revenue could be 
approximately 0.52 percent for the season.
    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. 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 25, 
2015, 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.
    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 action.
    A proposed rule concerning this action was published in the Federal 
Register on September 18, 2015 (80 FR 56399). 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 30-day comment period ending 
October 19, 2015, 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: http://www.ams.usda.gov/rules-regulations/moa/small-businesses. 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 also found and determined that good 
cause exists for not postponing the effective date of this rule until 
30 days after publication

[[Page 73642]]

in the Federal Register because the crop year began on August 1, 2015, 
and the marketing order requires that the rate of assessment for each 
fiscal period apply to all assessable onions handled during such 
period. Further, handlers are aware of this rule which was recommended 
at a public meeting. Also, a 60-day comment period was provided for in 
the proposed rule.

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, 2015, an assessment rate of $0.05 per 50-
pound equivalent is established for South Texas onions.

    Dated: November 20, 2015.
Rex A. Barnes,
Associate Administrator, Agricultural Marketing Service.
[FR Doc. 2015-30020 Filed 11-24-15; 8:45 am]
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