Rule2024-18709
Onions Grown in South Texas; Increased Assessment Rate
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
August 21, 2024
Effective
September 20, 2024
Issuing agencies
Agriculture DepartmentAgricultural Marketing Service
Abstract
This final rule implements a recommendation from the South Texas Onion Committee (Committee) to increase the assessment rate established for the 2023-2024 and subsequent fiscal periods from $0.05 to $0.08 per 50-pound container or equivalent for South Texas onions. The assessment rate will remain in effect indefinitely unless modified, suspended, or terminated.
Full Text
<html>
<head>
<title>Federal Register, Volume 89 Issue 162 (Wednesday, August 21, 2024)</title>
</head>
<body><pre>
[Federal Register Volume 89, Number 162 (Wednesday, August 21, 2024)]
[Rules and Regulations]
[Pages 67520-67522]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2024-18709]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 959
[Doc. No. AMS-SC-23-0086]
Onions Grown in South Texas; Increased Assessment Rate
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: This final rule implements a recommendation from the South
Texas Onion Committee (Committee) to increase the assessment rate
established for the 2023-2024 and subsequent fiscal periods from $0.05
to $0.08 per 50-pound container or equivalent for South Texas onions.
The assessment rate will remain in effect indefinitely unless modified,
suspended, or terminated.
DATES: Effective September 20, 2024.
FOR FURTHER INFORMATION CONTACT: Delaney Fuhrmeister, Marketing
Specialist, or Christian Nissen, Chief, Southeast Region Branch, Market
Development Division, Specialty Crops Program, AMS, USDA; Telephone:
(863) 324-3375 or Email: <a href="/cdn-cgi/l/email-protection#2a6e4f464b444f53046c5f4258474f43595e4f586a5f594e4b044d455c"><span class="__cf_email__" data-cfemail="2e6a4b424f404b5700685b465c434b475d5a4b5c6e5b5d4a4f00494158">[email protected]</span></a> or
<a href="/cdn-cgi/l/email-protection#0a49627863797e636b6424446379796f644a7f796e6b246d657c"><span class="__cf_email__" data-cfemail="65260d170c16110c040b4b2b0c1616000b25101601044b020a13">[email protected]</span></a>.
Small businesses may request information on complying with this
regulation by contacting Richard Lower, Market Development Division,
Specialty Crops Program, AMS, USDA, 1400 Independence Avenue SW, STOP
0237, Washington, DC 20250-0237; Telephone: (202) 720-8085, or Email:
<a href="/cdn-cgi/l/email-protection#c391aaa0aba2b1a7ed8facb4a6b183b6b0a7a2eda4acb5"><span class="__cf_email__" data-cfemail="52003b313a3320367c1e3d25372012272136337c353d24">[email protected]</span></a>.
SUPPLEMENTARY INFORMATION: This action, pursuant to 5 U.S.C. 553,
amends regulations issued to carry out a marketing order as defined in
7 CFR 900.2(j). This rule is issued under Marketing Order No. 959, as
amended (7 CFR part 959), regulating the handling of onions grown in
South Texas. Part 959 (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
onions operating within the area of production.
The Agricultural Marketing Service (AMS) is issuing this final rule
in conformance with Executive Orders 12866, 13563, and 14094. Executive
Orders 12866 and 13563 direct agencies to assess all costs and benefits
of available regulatory alternatives and, if regulation is necessary,
to select regulatory approaches that maximize net benefits (including
potential economic, environmental, public health and safety effects,
distributive impacts, and equity). Executive Order 13563 emphasizes the
importance of quantifying both costs and benefits, reducing costs,
harmonizing rules, and promoting flexibility. Executive Order 14094
reaffirms, supplements, and updates Executive Order 12866 and further
directs agencies to solicit and consider input from a wide range of
affected and interested parties through a variety of means. This action
falls within a category of regulatory actions that the Office of
Management and Budget (OMB) exempted from Executive Order 12866 review.
This final rule has been reviewed under Executive Order 13175--
Consultation and Coordination with Indian Tribal Governments, which
requires Federal agencies to consider whether their rulemaking actions
would have Tribal implications. AMS has determined that this rule is
unlikely to have substantial direct effects on one or more Indian
Tribes, on the relationship between the Federal Government and Indian
Tribes, or on the distribution of power and responsibilities between
the Federal Government and Indian Tribes.
This final rule has been reviewed under Executive Order 12988--
Civil Justice Reform. Under the 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
will be applicable to all assessable onions for the 2023-2024 fiscal
period, 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 8c(15)(A) of the
Act (7 U.S.C. 608c(15)(A)), any handler subject to an order may file
with the U.S. Department of Agriculture (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 final rule increases the assessment rate for South Texas
onions handled under the Order from $0.05 per 50-pound container or
equivalent, the rate that was established for the 2020-2021 and
subsequent fiscal periods, to $0.08 per 50-pound container or
equivalent for the 2023-2024 and subsequent fiscal periods.
Sections 959.41 and 959.42 authorize the Committee, with the
approval of AMS, to formulate an annual budget of expenses and collect
assessments from handlers to administer the program. The members of the
Committee are familiar with the Committee's needs and with the costs of
goods and services in their local area and are able to formulate an
appropriate budget and assessment rate. The assessment rate is
formulated and discussed in a public meeting, and all directly affected
persons have an opportunity to participate and provide input.
For the 2020-2021 and subsequent fiscal periods, the Committee
recommended, and AMS approved, an assessment rate of $0.05 per 50-pound
container or equivalent of South Texas onions within the production
area. That rate continues in effect from fiscal period to fiscal period
until modified, suspended, or terminated by AMS upon recommendation and
information submitted by the Committee or other information available
to AMS.
The Committee met on November 1, 2023, and unanimously recommended
2023-2024 fiscal period expenditures of $280,657 and an assessment rate
of $0.08 per 50-pound container or equivalent of South Texas onions
[[Page 67521]]
handled for the 2023-2024 and subsequent fiscal periods. In comparison,
last fiscal period's budgeted expenditures were $177,657. The
assessment rate of $0.08 per 50-pound container or equivalent is $0.03
higher than the rate currently in effect. The Committee recommended
increasing the assessment rate to better align assessment revenue with
budgeted expenses and to replenish reserves which were depleted between
March 2021 and December 2022 when the Committee ceased collecting
assessments during a temporary suspension under the Order. The
Committee estimates shipments for the 2023-2024 season to be around
3,600,000 50-pound containers or equivalents, an increase from the
3,020,000 50-pound containers or equivalents handled for the 2022-2023
fiscal period.
The major expenditures recommended by the Committee for the 2023-
2024 fiscal period include $92,000 for research and marketing; $80,000
for the compliance program; and $37,050 for administrative expenses. By
comparison, budgeted expenses for these items during the 2022-2023
fiscal period were $20,000; $50,000; and $37,050, respectively.
At the current assessment rate of $0.05, the expected 3,600,000 50-
pound containers or equivalents would generate $180,000 in assessment
revenue (3,600,000 50-pound containers or equivalents multiplied by
$0.05 assessment rate), which would not cover budgeted expenses. The
Committee recommended increasing the assessment rate to meet necessary
expenses, fund marketing research, and restore reserves. By increasing
the assessment rate by $0.03 to $0.08, assessment income will generate
$288,000 in assessment revenue (3,600,000 50-pound containers or
equivalents multiplied by $0.08 assessment rate). This amount should be
appropriate to ensure the Committee has sufficient revenue to fully
fund its recommended 2023-2024 fiscal period budgeted expenditures and
to begin replenishing the Committee's reserve funds.
The Committee derived the recommended assessment rate by
considering anticipated fiscal period expenses, expected shipments of
onions, and the amount of funds available in the financial reserve.
Income derived from handler assessments ($288,000), and other sources
including interest income, would be adequate to cover budgeted expenses
($280,657). Funds available in the financial reserve (currently about
$78,000) will be kept within the maximum permitted by the Order
(approximately two fiscal periods' expenses as authorized in Sec.
959.43).
The assessment rate will continue in effect indefinitely unless
modified, suspended, or terminated by AMS 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 AMS.
Committee meetings are open to the public and interested persons may
express their views at these meetings. AMS will 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 2023-2024 fiscal period
budget, and those for subsequent fiscal periods, will be reviewed and,
as appropriate, approved by AMS.
Final Regulatory Flexibility Analysis
Pursuant to requirements set forth in the Regulatory Flexibility
Act (RFA) (5 U.S.C. 601-612), AMS has considered the economic impact of
this final 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 23 handlers of South Texas onions subject to regulation
under the Order and approximately 55 producers of South Texas onions in
the production area. At the time this analysis was prepared, the Small
Business Administration (SBA) defined small agricultural service firms
as those having annual receipts of less than $34,000,000 (North
American Industry Classification System (NAICS) code 115114,
Postharvest Crop Activities), and small agricultural producers of
onions as those having annual receipts of less than $3,750,000 (NAICS
code 111219, Other Vegetable Farming) (13 CFR 121.201).
According to data from Market News and production records from the
Committee, the average price for South Texas onions handled during the
2022-2023 season was approximately $23.25 per 50-pound container or
equivalent, with total shipments of around 3,020,000 50-pound
containers or equivalents shipped. Based on the average terminal market
price and shipment information, the number of handlers, and assuming a
normal distribution, the majority of South Texas onion handlers have
estimated average annual receipts of significantly less than
$34,000,000 ($23.25 multiplied by 3,020,000 50-pound containers or
equivalents equals $70,215,000, divided by 23 handlers equals
$3,052,826 per handler).
In addition, based on data from the National Agricultural
Statistics Service and the Committee, the average price producers
received for South Texas onions during the 2022-2023 season was
approximately $17 per 50-pound container or equivalent, with total
shipments of around 3,020,000 million 50-pound containers or
equivalents. Using the average price producers received and shipment
information, the number of producers, and assuming a normal
distribution, the majority of producers have estimated average annual
receipts of significantly less than $3,750,000 ($17 multiplied by
3,020,000 50-pound containers or equivalents equals $51,340,000,
divided by 55 producers equals $933,455 per producer). Thus, the
majority of handlers and producers of South Texas onions may be
classified as small entities.
This final rule increases the assessment rate collected from
handlers for the 2023-2024 and subsequent fiscal periods from $0.05 to
$0.08 per 50-pound container or equivalent of South Texas onions. The
Committee unanimously recommended 2023-2024 fiscal period expenditures
of $280,657 and an assessment rate of $0.08 per 50-pound container or
equivalent of South Texas onions. The assessment rate of $0.08 is $0.03
higher than the current rate. The Committee expects the industry to
handle 3,600,000 50-pound container or equivalent of South Texas onions
during the 2023-2024 fiscal period. Thus, the $0.08 per 50-pound
container or equivalent rate should provide $288,000 in assessment
income (3,600,000 50-pound containers or equivalents multiplied by
$0.08 assessment rate). Income derived from handler assessments and
other sources including interest income, should be adequate to cover
budgeted expenses.
[[Page 67522]]
The major expenditures recommended by the Committee for the 2023-
2024 fiscal period include $92,000 for research and marketing; $80,000
for the compliance program; and $37,050 for administrative expenses. By
comparison, budgeted expenses for these items during the 2022-2023
fiscal period were $20,000; $50,000; and $37,050, respectively.
The Committee recommended increasing the assessment rate to meet
necessary expenses, fund marketing research, and restore reserves,
which were depleted between March 2021 and December 2022 when the
Committee ceased collecting assessments during a temporary suspension
under the marketing order. The Committee estimates shipments for the
2023-2024 season to be around 3,600,000 50-pound containers or
equivalents. Given the estimated number of shipments, the current
assessment rate of $0.05 would generate $180,000 in assessment income
(3,600,000 50-pound containers or equivalents multiplied by $0.05
assessment rate), which would not cover budgeted expenses. By
increasing the assessment rate by $0.03 to $0.08, assessment income
would be $288,000 (3,600,000 50-pound containers or equivalents
multiplied by $0.08 assessment rate). This amount should provide
sufficient funds to meet anticipated 2023-2024 expenses, while adding
money to the financial reserve.
Prior to arriving at this budget and assessment rate, the Committee
discussed various alternatives, including maintaining the current
assessment rate of $0.05 per 50-pound container or equivalent or
increasing the assessment rate to $0.06. However, neither of these
assessment rates would provide enough income to cover budgeted
expenses. Consequently, these alternative assessment rates were
rejected.
A review of historical and preliminary information pertaining to
the upcoming fiscal period indicates the average grower price for the
2023-2024 season should be approximately $16.00 per 50-pound container
or equivalent of South Texas onions. Therefore, the estimated
assessment revenue for the 2023-2024 crop year as a percentage of total
grower revenue would be about 0.5 percent ($0.08 assessment rate
divided by $16.00 multiplied by 100).
This action increases the assessment obligation imposed on South
Texas onion handlers. Assessments are applied uniformly on all
handlers, and some of the costs may be passed on to producers. However,
these costs are expected to be offset by the benefits derived by the
operation of the Order.
The Committee's meetings are widely publicized throughout the South
Texas onion industry and all interested persons are invited to attend
the meetings and participate in Committee deliberations on all issues.
Like all Committee meetings, the November 1, 2023, meeting was a public
meeting and all entities, both large and small, were able to express
views on this issue. Finally, interested persons were invited to submit
comments on this rule, including the regulatory and information
collection 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 OMB and assigned OMB No. 0581-0178, Vegetable
and Specialty Crops. No changes in those requirements would be
necessary as a result of this final rule. Should any changes become
necessary, they would be submitted to OMB for approval.
This final rule will not impose any 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.
AMS has not identified any relevant Federal rules that duplicate,
overlap, or conflict with this rule.
A proposed rulemaking concerning this action was published in the
Federal Register on April 24, 2024 (89 FR 31093). Copies of the
proposed rulemaking were provided to all South Texas onion handlers.
The proposal was also made available through the internet by USDA and
the Office of the Federal Register. A 30-day comment period ending May
24, 2024, was provided for interested persons to respond to the
proposal. AMS received one comment during the comment period. The
comment opposed the revised assessment rate but provided no substantive
data or justification for AMS to evaluate. After reviewing the comment,
AMS made no changes to the rule as proposed.
A small business guide on complying with fruit, vegetable, and
specialty crop marketing agreements and orders may be viewed at:
<a href="https://www.ams.usda.gov/rules-regulations/moa/small-businesses">https://www.ams.usda.gov/rules-regulations/moa/small-businesses</a>. Any
questions about the compliance guide should be sent to Richard Lower at
the previously mentioned address in the FOR FURTHER INFORMATION CONTACT
section.
After consideration of all relevant material presented, including
the information and recommendations submitted by the Committee and
other available information, USDA has determined that this final rule
is consistent with and effectuates the purposes of the Act.
List of Subjects in 7 CFR Part 959
Marketing agreements, Onions, Reporting and recordkeeping
requirements.
For the reasons set forth in the preamble, the Agricultural
Marketing Service amends 7 CFR part 959 as follows:
PART 959--ONIONS GROWN IN SOUTH TEXAS
0
1. The authority citation for 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, 2023, an assessment rate of $0.08 per 50-
pound container or equivalent is established for South Texas onions.
Erin Morris,
Associate Administrator, Agricultural Marketing Service.
[FR Doc. 2024-18709 Filed 8-20-24; 8:45 am]
BILLING CODE 3410-02-P
</pre><script data-cfasync="false" src="/cdn-cgi/scripts/5c5dd728/cloudflare-static/email-decode.min.js"></script></body>
</html>Indexed from Federal Register on August 21, 2024.
This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.