Proposed Rule2024-22213
Irish Potatoes Grown in Certain Designated Counties in Idaho, and Malheur County, Oregon; Increased Assessment Rate
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Published
September 27, 2024
Issuing agencies
Agriculture DepartmentAgricultural Marketing Service
Abstract
This proposed rule would implement a recommendation from the Idaho-Eastern Oregon Potato Committee (Committee) to increase the assessment rate established for the 2024-2025 fiscal period and subsequent fiscal periods from $0.002 to $0.003 per hundredweight of potatoes handled under the marketing order. The proposed assessment rate would remain in effect indefinitely unless modified, suspended, or terminated.
Full Text
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<title>Federal Register, Volume 89 Issue 188 (Friday, September 27, 2024)</title>
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[Federal Register Volume 89, Number 188 (Friday, September 27, 2024)]
[Proposed Rules]
[Pages 79175-79178]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2024-22213]
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DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 945
[Doc. No. AMS-SC-24-0042]
Irish Potatoes Grown in Certain Designated Counties in Idaho, and
Malheur County, Oregon; Increased Assessment Rate
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Proposed rule.
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SUMMARY: This proposed rule would implement a recommendation from the
Idaho-Eastern Oregon Potato Committee (Committee) to increase the
assessment rate established for the 2024-2025 fiscal period and
subsequent fiscal periods from $0.002 to $0.003 per hundredweight of
potatoes handled under the marketing order. The proposed assessment
rate would remain in effect indefinitely unless modified, suspended, or
terminated.
DATES: Comments must be received by October 28, 2024.
ADDRESSES: Interested persons are invited to submit written comments
concerning this proposed rule. Comments can be sent to the Docket
Clerk, Market Development Division, Specialty Crops Program, AMS, USDA,
1400 Independence Avenue SW, STOP 0237, Washington, DC 20250-0237.
Comments can also be submitted to the Docket Clerk electronically by
Email: <a href="/cdn-cgi/l/email-protection#3b765a49505e4f52555c74495f5e49785456565e554f7b4e485f5a155c544d"><span class="__cf_email__" data-cfemail="85c8e4f7eee0f1ecebe2caf7e1e0f7c6eae8e8e0ebf1c5f0f6e1e4abe2eaf3">[email protected]</span></a> or via the internet at: <a href="https://www.regulations.gov">https://www.regulations.gov</a>. Comments should reference the document number and
the date and page number of this issue of the Federal Register.
Comments submitted in response to this proposed rule will be included
in the record and made available to the public and can be viewed at:
<a href="https://www.regulations.gov">https://www.regulations.gov</a>. 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: Gregory A. Breasher, Marketing
Specialist, or Barry M. Broadbent, Chief, Northwest Region Branch,
Market Development Division, Specialty Crops Program, AMS, USDA;
Telephone: (503) 326-2282, or Email: <a href="/cdn-cgi/l/email-protection#a1c6d3c4c6ced3d88fc3d3c4c0d2c9c4d3e1d4d2c5c08fc6ced7"><span class="__cf_email__" data-cfemail="72150017151d000b5c10001713011a170032070116135c151d04">[email protected]</span></a> or
<a href="/cdn-cgi/l/email-protection#f7959685858ed9958598969395929983b782849396d9909881"><span class="__cf_email__" data-cfemail="aac8cbd8d8d384c8d8c5cbcec8cfc4deeadfd9cecb84cdc5dc">[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#f3a19a909b928197ddbf9c849681b386809792dd949c85"><span class="__cf_email__" data-cfemail="5f0d363c373e2d3b711330283a2d1f2a2c3b3e71383029">[email protected]</span></a>.
SUPPLEMENTARY INFORMATION: This action, pursuant to 5 U.S.C. 553,
proposes to amend regulations issued to carry out a marketing order as
defined in 7 CFR 900.2(j). This proposed rule is issued under Marketing
Agreement No. 98 and Marketing Order No. 945, both as amended (7 CFR
part 945), regulating the handling of potatoes grown in certain
counties in Idaho, and Malheur County, Oregon. Part 945 (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 comprises
producers and handlers of potatoes operating within the area of
production.
The Agricultural Marketing Service (AMS) is issuing this proposed
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 proposed action falls within a category of regulatory actions that
the Office of Management and Budget (OMB) exempted from Executive Order
12866 review.
This proposed 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 proposed
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 proposed rule has been reviewed under Executive Order 12988--
Civil Justice Reform. Under the Order now in effect, Idaho-Eastern
Oregon potato
[[Page 79176]]
handlers are subject to assessments. Funds to administer the Order are
derived from such assessments. It is intended that the assessment rate
would be applicable to all assessable Idaho-Eastern Oregon potatoes for
the 2024-2025 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. 608(c)(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 requesting
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 increase the assessment rate for Idaho-
Eastern Oregon potatoes handled under the Order from $0.002 per
hundredweight, the rate that was established for the 2017-2018 fiscal
period and subsequent fiscal periods (82 FR 28550), to $0.003 per
hundredweight for the 2024-2025 fiscal period and subsequent fiscal
periods.
Sections 945.41 and 945.42 of the Order 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 2017-2018 fiscal period and subsequent fiscal periods, the
Committee recommended, and AMS approved, an assessment rate of $0.002
per hundredweight of Idaho-Eastern Oregon potatoes within the
production area (82 FR 28550). 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 June 5, 2024, and unanimously recommended
2024-2025 fiscal period expenditures of $99,522 and an assessment rate
of $0.003 per hundredweight of Idaho Eastern-Oregon potatoes handled
for the 2024-2025 fiscal period and subsequent fiscal periods. In
comparison, the budgeted expenditures for fiscal period 2023-2024 were
$99,703. The proposed assessment rate of $0.003 per hundredweight is
$0.001 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 August 2017 and June 2024. The Committee estimates
shipments for the 2024-2025 season to be approximately 34,000,000
hundredweight, an increase from the 28,167,500 hundredweight handled
for the 2023-2024 fiscal period.
The major expenditures recommended by the Committee for the 2024-
2025 fiscal period include $75,489 in administrative expenses; $10,013
for operational expenses; $4,670 for insurance/banking expenses; $4,000
for annual audit/compliance expenses; $2,950 for committee travel
expenses and $2,400 for IT support. For comparison, budgeted expenses
for these items during the 2023-2024 fiscal period were $74,960,
$10,013, $4,880, $4,500, $2,950, and $2,400, respectively.
The expected 34,000,000 hundredweight of Idaho-Eastern Oregon
potatoes from the 2024-2025 crop would generate $102,000 in assessment
revenue at the proposed assessment rate (34,000,000 hundredweight of
potatoes multiplied by $0.003 assessment rate). The assessment rate
increase should be appropriate to ensure the Committee has sufficient
revenue to fully fund its recommended 2024-2025 fiscal period budgeted
expenditures and begin replenishing the Committee's reserve funds to a
level that the Committee believes is appropriate.
The Committee derived the recommended assessment rate by
considering anticipated fiscal period expenses, expected shipments of
potatoes, and the amount of funds available in the financial reserve.
Income derived from handler assessments ($102,000) would be adequate to
cover budgeted expenses ($99,522). Funds available in the financial
reserve (currently about $80,000) would be kept within the maximum
permitted by the Order (approximately one fiscal period's expenses as
authorized in Sec. 945.44).
The proposed assessment rate would 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 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 AMS. Committee meetings are open to the public and interested
persons may express their views at these meetings. AMS 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 2024-2025
fiscal period budget, and those for subsequent fiscal periods, will be
reviewed and, as appropriate, approved by AMS.
Initial 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 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 450 producers of Idaho-Eastern Oregon
potatoes in the production area and 32 handlers subject to regulation
under the Order. At the time this analysis was prepared, the Small
Business Administration (SBA) defined small agricultural service firms
as those having annual receipts equal to or less than $34,000,000
(North American Industry Classification System (NAICS) code 115114,
Postharvest Crop Activities), and small agricultural producers of
potatoes as those having annual receipts equal to or less than
$4,250,000 (NAICS code 111211, Potato Farming) (13 CFR 121.201).
According to the National Agricultural Statistics Service (NASS),
the average annual producer price
[[Page 79177]]
received for fresh market potatoes in Idaho, and Malheur County,
Oregon, in 2022, the most recent full year for which there is NASS
data, was $12.50 per hundredweight. Total shipments of Idaho-Eastern
Oregon potatoes for the 2021-2022 season were reported by the Committee
to be 28,167,500 hundredweight. Using the average producer price from
2022, the total 2021-2022 crop value of Idaho-Eastern Oregon potatoes
could therefore be estimated to be $352,093,750 (28,167,500
hundredweight times $12.50 per hundredweight). Dividing the crop value
by the estimated number of producers (450) yields an estimated average
receipt per producer of $782,431. This figure is well below the SBA
small agricultural producer threshold of $4,250,000 in annual receipts.
Assuming a normal distribution, this provides evidence that a large
majority of potato producers would likely be considered small
agricultural producers according to the SBA definition.
According to AMS Market News data, the reported average free on
board (FOB) price for potatoes from Idaho-Eastern Oregon over the 2021-
2022 fiscal period was $15.68 per 50-pound carton, depending upon
variety, size and grade, and shipping date. Multiplying this figure by
2 (to adjust to hundredweight) yields an average FOB price of $31.36
per hundredweight for the 2021-2022 fiscal period. Multiplying the
2021-2022 Idaho-Eastern Oregon potato production of 28,167,500
hundredweight by the estimated average price per hundredweight of
$31.36 equals $883,332,800. Dividing this figure by 32 regulated
handlers yields estimated average annual handler receipts of
$27,604,150 ($883,332,800 divided by 32 handlers), which is below the
SBA threshold for small agricultural service firms. Therefore,
according to the above data and assuming a normal distribution, most of
the producers, and many of the handlers, of Idaho-Eastern Oregon
potatoes may be classified as small entities.
This proposal would increase the assessment rate collected from
handlers for the 2024-2025 fiscal period and subsequent fiscal periods
from $0.002 to $0.003 per hundredweight of Idaho-Eastern Oregon
potatoes. The Committee unanimously recommended 2024-2025 fiscal period
expenditures of $99,522 and an assessment rate of $0.003 per
hundredweight of Idaho-Eastern Oregon potatoes handled. The proposed
assessment rate of $0.003 is $0.001 higher than the rate currently in
effect. The Committee expects the industry to handle 34,000,000
hundredweight of Idaho-Eastern Oregon potatoes during the 2024-2025
fiscal period. Thus, the $0.003 per hundredweight rate should provide
$102,000 in assessment income (34,000,000 hundredweight multiplied by
$0.003). The Committee expects that income generated from handler
assessments should be sufficient to meet budgeted expenditures for the
2024-2025 fiscal period.
The major expenditures recommended by the Committee for the 2024-
2025 fiscal period include $75,489 in administrative expenses; $10,013
for operational expenses; $4,670 for insurance/banking expenses; $4,000
for annual audit/compliance expenses; $2,950 for committee travel
expenses and $2,400 for IT support. For comparison, budgeted expenses
for these items during the 2023-2024 fiscal period were $74,960,
$10,013, $4,880, $4,500, $2,950, and $2,400, respectively.
In recent years, the Committee has utilized reserve funds to
partially fund its budgeted expenditures. The Committee recommended
increasing the assessment rate to fully fund 2024-2025 fiscal period
budgeted expenditures and replenish funds held in its reserve. This
action would add an estimated $2,478 to the Committee's financial
reserve fund. The reserve balance would be kept at a level that the
Committee believes is appropriate and which is compliant with the
provisions of the Order.
Prior to arriving at this budget and assessment rate
recommendation, the Committee discussed various alternatives, including
maintaining the current assessment rate of $0.002 per hundredweight and
increasing the assessment rate by different amounts. However, the
Committee determined that the recommended assessment rate would fully
fund budgeted expenses and replenish reserves to appropriate levels.
The assessment rate of $0.003 per hundredweight of Idaho-Eastern Oregon
potatoes was derived by considering anticipated expenses, the projected
volume of assessable Idaho-Eastern Oregon potatoes, the projected
monetary balance held in reserve, and additional pertinent factors.
A review of NASS information indicates that the average producer
price for the 2021-2022 fiscal period was $12.50 per hundredweight of
potatoes in the production area. Therefore, utilizing the proposed
assessment rate of $0.003 per hundredweight, assessment revenue for the
2021-2022 fiscal period, as a percentage of total producer revenue,
would have been approximately 0.024 percent of total producer revenue
($0.003 divided by $12.50 multiplied by 100).
This proposed action would increase the assessment obligation
imposed on Idaho-Eastern Oregon potato 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
production area. The Idaho-Eastern Oregon potato industry and all
interested persons are invited to attend the meetings and participate
in Committee deliberations on all issues. Like all Committee meetings,
the June 5, 2024, 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 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 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 Idaho-Eastern
Oregon potato 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 and 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 proposed rule.
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.
[[Page 79178]]
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 proposed
rule is consistent with and will effectuate the purposes of the Act.
A 30-day comment period is provided to allow interested persons to
respond to this proposed rule. All written comments timely received
will be considered before a final determination is made on this
rulemaking.
List of Subjects in 7 CFR Part 945
Marketing agreements, Potatoes, Reporting and recordkeeping
requirements.
For the reasons set forth in the preamble, the Agricultural
Marketing Service proposes to amend 7 CFR part 945 as follows:
PART 945--IRISH POTATOES GROWN IN CERTAIN DESIGNATED COUNTIES IN
IDAHO, AND MALHEUR COUNTY, OREGON
0
1. The authority citation for 7 CFR part 945 continues to read as
follows:
Authority: 7 U.S.C. 601-674.
0
2. Revise Sec. 945.249 to read as follows:
Sec. 945.249 Assessment rate.
On and after August 1, 2024, an assessment rate of $0.003 per
hundredweight is established for Idaho-Eastern Oregon potatoes.
Erin Morris,
Associate Administrator, Agricultural Marketing Service.
[FR Doc. 2024-22213 Filed 9-26-24; 8:45 am]
BILLING CODE 3410-02-P
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