Proposed Rule2025-00193
Oranges and Grapefruit Grown in Lower Rio Grande Valley in Texas; Increased Assessment Rate
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Published
January 15, 2025
Issuing agencies
Agriculture DepartmentAgricultural Marketing Service
Abstract
This proposed rule would implement a recommendation from the Texas Valley Citrus Committee (Committee) to increase the assessment rate established for the 2024-2025 and subsequent fiscal periods from $0.03 to $0.04 per 7/10-bushel carton or equivalent of oranges and grapefruit grown in Texas. The proposed assessment rate would remain in effect indefinitely unless modified, suspended, or terminated.
Full Text
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<title>Federal Register, Volume 90 Issue 9 (Wednesday, January 15, 2025)</title>
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[Federal Register Volume 90, Number 9 (Wednesday, January 15, 2025)]
[Proposed Rules]
[Pages 3720-3723]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2025-00193]
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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. 90, No. 9 / Wednesday, January 15, 2025 /
Proposed Rules
[[Page 3720]]
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 906
[Doc. No. AMS-SC-24-0046]
Oranges and Grapefruit Grown in Lower Rio Grande Valley in Texas;
Increased Assessment Rate
AGENCY: Agricultural Marketing Service, Department of Agriculture
(USDA).
ACTION: Proposed rule.
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SUMMARY: This proposed rule would implement a recommendation from the
Texas Valley Citrus Committee (Committee) to increase the assessment
rate established for the 2024-2025 and subsequent fiscal periods from
$0.03 to $0.04 per 7/10-bushel carton or equivalent of oranges and
grapefruit grown in Texas. The proposed assessment rate would remain in
effect indefinitely unless modified, suspended, or terminated.
DATES: Comments must be received by February 14, 2025.
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 sent to the Docket Clerk electronically by Email:
<a href="/cdn-cgi/l/email-protection#7a371b08111f0e13141d35081e1f08391517171f140e3a0f091e1b541d150c"><span class="__cf_email__" data-cfemail="501d31223b3524393e371f22343522133f3d3d353e2410252334317e373f26">[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, will be 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: Delaney Fuhrmeister, Marketing
Specialist, or Christian D. 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#cb8faea7aaa5aeb2e58dbea3b9a6aea2b8bfaeb98bbeb8afaae5aca4bd"><span class="__cf_email__" data-cfemail="2a6e4f464b444f53046c5f4258474f43595e4f586a5f594e4b044d455c">[email protected]</span></a> or
<a href="/cdn-cgi/l/email-protection#64270c160d17100d050a4a2a0d1717010a24111700054a030b12"><span class="__cf_email__" data-cfemail="682b001a011b1c0109064626011b1b0d06281d1b0c09460f071e">[email protected]</span></a>.
Small businesses may request information on complying with this
regulation by contacting Antoinette Carter, 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#e1a08f958e888f84959584cfa28093958493a194928580cf868e97"><span class="__cf_email__" data-cfemail="2b6a455f4442454e5f5f4e05684a595f4e596b5e584f4a054c445d">[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
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 (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 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, Texas orange and
grapefruit handlers are subject to assessments. Funds to administer the
Order are derived from such assessments. It is intended that the
proposed assessment rate would be applicable to all assessable Texas
citrus 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 608c(15)(A) of the
Act, 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 proposed rule would increase the assessment rate for Texas
oranges and grapefruit handled under the Order from $0.03 to $0.04 per
7/10-bushel carton or equivalent for the 2024-2025 fiscal period and
subsequent fiscal periods.
Sections 906.33 and 906.34 of the Order authorize the Committee,
with the
[[Page 3721]]
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 can 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 2022-23 and subsequent fiscal periods, the Committee
recommended, and AMS approved, an assessment rate of $0.03 per 7/10-
bushel carton or equivalent of Texas citrus 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 June 18, 2024, and unanimously recommended
2024-2025 fiscal period expenditures of $134,970 and an increased
assessment rate of $0.04 per 7/10-bushel carton or equivalent of Texas
oranges and grapefruit handled for 2024-2025 fiscal periods. The
budgeted expenditures remain unchanged compared to last year's
recommended expenditures. The proposed assessment rate of $0.04 is
$0.01 higher than the rate currently in effect. The Committee
recommended increasing the assessment rate to cover expenses for the
current fiscal year and replenish reserves. The Committee estimates
shipments for the 2024-2025 fiscal period to be around 4,000,000 7/10-
bushel cartons or equivalents, similar to the 3,976,000 7/10-bushel
cartons or equivalents handled in the 2023-2024 fiscal period.
The major expenditures recommended by the Committee for the 2024-
2025 fiscal period include $66,220 for management expenses, $50,000 for
compliance, and $18,750 for general administrative expenses, the same
as budgeted for these items during the 2023-2024 fiscal period.
At the current assessment rate of $0.03, the expected 4,000,000 7/
10-bushel cartons or equivalents would generate $120,000 in assessment
revenue (4,000,000 7/10-bushel cartons or equivalents multiplied by
$0.03 assessment rate), which would not cover budgeted expenses.
Further, shipments from the 2023-2024 fiscal period were approximately
4,000,000 7/10-bushel cartons or equivalents of citrus, which was well
below the estimated crop of 5,000,000 7/10-bushel cartons or
equivalents. The smaller crop forced the Committee to use the remainder
of their reserves to help cover 2023-2024 fiscal period expenses.
Consequently, the Committee recommended increasing the assessment rate
to meet necessary expenses and restore reserves. By increasing the
assessment rate from $0.03 to $0.04, assessment income would generate
$160,000 in assessment revenue (4,000,000 7/10-bushel cartons or
equivalents multiplied by $0.04 assessment rate). This amount should be
appropriate to ensure the Committee has sufficient revenue to fully
fund its recommended 2024-2025 budgeted expenditures and replenish the
Committee's reserve funds.
The Committee derived the recommended assessment rate by reviewing
anticipated expenses, the estimated volume of assessable Texas citrus,
and the level of funds available in the financial reserve. Income
generated from handler assessments should be sufficient to meet the
Committee's estimated program expenditures of $134,970. Funds available
in the financial reserve (currently about $0) would be kept within the
maximum permitted by the Order (approximately one fiscal period's
expenses as authorized in Sec. 906.35).
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 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 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 17 handlers of Texas oranges and grapefruit
subject to regulation under the Order and approximately 75 orange and
grapefruit producers in the regulated area. At the time this analysis
was prepared, the Small Business Administration (SBA) defined small
agricultural producers as those having annual receipts equal to or less
than $4 million for orange producers (North American Industry
Classification System (NAICS) code 111310), and $4.25 million for other
citrus producers (including grapefruit) (NAICS code 111320). Small
agricultural service firms, including handlers, are defined as those
whose annual receipts are equal to or less than $34 million (NAICS code
115114) (13 CFR 121.201).
According to data from the National Agricultural Statistics Service
(NASS), the producer prices for U.S. fresh oranges and grapefruit were
$11.63 and $15.63 per carton, respectively. The prices for U.S. fresh
oranges and grapefruit are used for this RFA because NASS does not
publish fresh citrus prices for Texas. Based on data provided by the
Committee, the number of orange and grapefruit 7/10-bushel cartons or
equivalents shipped in the 2023-2024 season were 1,462,800 and
2,513,258, respectively.
Using the producer prices, shipment data, and the total number of
Texas orange and grapefruit producers, and assuming a normal
distribution, the majority of producers have estimated average annual
receipts of significantly less than the SBA threshold of $4 million
($11.63 multiplied by 1,462,800 cartons plus $15.63 multiplied by
2,513,258 cartons equals $112,564,041, divided by 75 producers equals
$750,594 per producer).
In addition, based on the NASS data, the average prices of fresh
U.S. oranges and grapefruit handled for 2023-2024 were $18.40 and
$23.05, respectively. Using the same shipment data from the Committee,
the number of orange and grapefruit cartons shipped in the 2023-2024
season, and assuming a normal distribution, the majority of Texas
orange and grapefruit handlers have
[[Page 3722]]
average annual receipts of less than $34 million ($18.40 multiplied by
1,462,800 cartons plus $23.05 multiplied by 2,513,258 cartons equals
$84,846,117, divided by 17 handlers equals $4,990,948 per handler).
Thus, the majority of Texas orange and grapefruit producers and
handlers 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 $0.03 to $0.04 per 7/10-bushel carton or equivalent of Texas
oranges and grapefruit. The Committee unanimously recommended 2024-2025
expenditures of $134,970 and an assessment rate of $0.04 per 7/10-
bushel carton or equivalent. The recommended assessment rate of $0.04
is $0.01 higher than the current assessment rate. The 2024-2025 crop
year is estimated to be 4,000,000 7/10-bushel cartons or equivalents.
The $0.04 per 7/10-bushel carton or equivalent assessment rate should
provide $160,000 in assessment income (4,000,000 7/10-bushel cartons or
equivalents multiplied by $0.04 assessment rate). Income derived from
handler assessments should be sufficient to cover budgeted expenses.
The major expenditures recommended by the Committee for the 2024-25
fiscal period include $66,220 for management expenses, $50,000 for
compliance, and $18,750 for general administrative expenses. This is
the same as budgeted for these items during the 2023-2024 fiscal
period.
The Committee recommended increasing the assessment rate to meet
necessary expenses and restore reserves. The reserves were depleted
when shipments from the 2023-2024 fiscal period were approximately
4,000,000 7/10-bushel cartons or equivalents, which was well below the
estimated crop of 5,000,000 7/10-bushel cartons or equivalents. The
Committee estimates shipments for the 2024-2025 season to be around
4,000,000 7/10-bushel cartons or equivalents. Given the estimated
number of shipments, the current assessment rate of $0.03 would
generate $120,000 in assessment income (4,000,000 7/10-bushel cartons
or equivalents multiplied by $0.03 assessment rate), which would not
cover budgeted expenses. By increasing the assessment rate from $0.03
to $0.04, assessment income would be $160,000 (4,000,000 7/10-bushel
cartons or equivalents multiplied by $0.04 assessment rate). This
amount should provide sufficient funds to meet anticipated 2024-2025
expenses, while adding money to the financial reserve.
Prior to arriving at this budget and assessment rate
recommendation, the Committee considered alternatives from the
Committee staff during a discussion at the June 18, 2024, meeting.
Staff prepared fifteen different proposed budgets with different
combinations of assessment rates, estimated shipments, and alternate
expenditure levels. The Committee determined maintaining expenses and
estimated shipments of 4,000,000 7/10-bushel cartons or equivalent of
oranges and grapefruit were representative of the 2024-2025 fiscal
period, and an assessment rate of $0.04 would cover expenditures and
add funds to the financial reserve. Consequently, the other
alternatives were rejected.
A review of historical and preliminary information pertaining to
the 2024-2025 fiscal period indicates the average producer price for
Texas oranges and grapefruit for the 2024-2025 season should be
approximately $14.15 per 7/10-bushel carton or equivalent. Therefore,
utilizing the recommended assessment rate of $0.04 per 7/10-bushel
carton or equivalent, assessment revenue for the 2024 fiscal period as
a percentage of total producer revenue would be approximately 0.2
percent ($0.04 divided by $14.15 times 100).
This proposed rule would increase 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, these costs
are expected be offset by the benefits derived by the operation of the
Order.
The Committee's meetings are widely publicized throughout the Texas
citrus 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 18, 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. 0581-0189, Fruit Crops.
No changes in those requirements would be necessary because 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 citrus
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 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 Antoinette
Carter 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, AMS has determined that this proposed rule
is consistent with, and would 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
proposed 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, the Agricultural
Marketing Service proposes to amend 7 CFR part 906 as follows:
PART 906--ORANGES AND GRAPEFRUIT GROWN IN LOWER RIO GRANDE VALLEY
IN TEXAS
0
1. The authority citation for part 906 continues to read as follows:
Authority: 7 U.S.C. 601-674.
0
2. Section 906.235 is revised to read as follows:
Sec. 906.235 Assessment rate.
On and after August 1, 2024, an assessment rate of $0.04 per 7/10-
bushel
[[Page 3723]]
carton or equivalent is established for oranges and grapefruit grown in
the Lower Rio Grande Valley in Texas.
Erin Morris,
Associate Administrator, Agricultural Marketing Service.
[FR Doc. 2025-00193 Filed 1-14-25; 8:45 am]
BILLING CODE P
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