[Federal Register Volume 61, Number 97 (Friday, May 17, 1996)]
[Rules and Regulations]
[Pages 24877-24878]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-12434]



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 Rules and Regulations
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  Federal Register / Vol. 61, No. 97 / Friday, May 17, 1996 / Rules and 
Regulations  

[[Page 24877]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 959

[Docket No. FV95-959-3FR]


Onions Grown in South Texas; Change in Regulatory Period

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

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SUMMARY: This final rule changes the end of the regulatory period for 
onions grown in South Texas under Marketing Order 959 from June 15 to 
June 4 of each year. Terminating the handling regulation on June 4 will 
relieve restrictions on handlers who ship late season onions and help 
them become more competitive with handlers from non-marketing order 
areas without diminishing South Texas marketing order objectives. A 
corresponding change in the dates for the import regulation also will 
be made in a second document. This final rule also includes a 
conforming change recognizing that the onions previously defined as 
``Extra large'' are now defined as ``Colossal'' under the U.S. grade 
standards for onions.

EFFECTIVE DATE: June 4, 1996.

FOR FURTHER INFORMATION CONTACT: Belinda G. Garza, Marketing Order 
Administration Branch, F&V, AMS, USDA, 1313 E. Hackberry, McAllen, TX 
78501; telephone: 210-682-2833; FAX 210-682-5942; or Robert F. 
Matthews, Marketing Specialist, Marketing Order Administration Branch, 
F&V, AMS, USDA, room 2523-S, P.O. Box 96456, Washington, DC 20090-6456; 
telephone: 202-690-0464; FAX 202-720-5698.

SUPPLEMENTARY INFORMATION: This final rule is issued under Marketing 
Agreement No. 143 and Marketing Order No. 959 (7 CFR part 959), as 
amended, regulating the handling of onions grown in South Texas, 
hereinafter referred to as the ``order.'' This 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 (Department) is issuing this rule in 
conformance with Executive Order 12866.
    This final rule has been reviewed under Executive Order 12778, 
Civil Justice Reform. This rule is not intended to have retroactive 
effect. This final rule will not preempt any State or local laws, 
regulations, or policies, unless they present an irreconcilable 
conflict with this rule.
    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 Secretary 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. A handler is afforded the opportunity for a hearing on the 
petition. After the hearing the Secretary will 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 the Secretary's 
ruling on the petition, provided an action is filed not later than 20 
days after the date of the entry of the ruling.
    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA), the Agricultural Marketing Service (AMS) has considered the 
economic impact of this action on small entities.
    The purpose of the RFA is to fit regulatory actions to the scale of 
business subject to such actions in order that small businesses will 
not be unduly or disproportionately burdened. Marketing orders issued 
pursuant to the Act, and rules issued thereunder, are unique in that 
they are brought about through group action of essentially small 
entities acting on their own behalf. Thus, both statutes have small 
entity orientation and compatibility.
    There are 35 handlers of South Texas onions who are subject to 
regulation under the marketing order and 89 producers in the regulated 
area. Small agricultural service firms, which includes handlers, have 
been defined by the Small Business Administration (13 CFR 121.601) as 
those having annual receipts of less than $5,000,000, and small 
agricultural producers are defined as those having annual receipts of 
less than $500,000. The majority of handlers and producers of South 
Texas onions may be classified as small entities.
    At a public meeting on November 8, 1994, the South Texas Onion 
Committee (committee) unanimously recommended, under the authority of 
Sec. 959.52(c) of the order, changing the termination date of the 
regulatory period for all varieties of regulated onions from June 15 to 
June 4. Currently, order regulations are in effect from March 1 through 
June 15 each year. The early and mid-season crop is produced in the 
Lower Rio Grande Valley (District 1), which generally accounts for 
about 80 percent of the total. The remaining crop, generally 20 
percent, is produced in the Laredo-Winter Garden area of South Texas 
(District 2). These are the last regulated shipments to leave the 
production area each season.
    In April 1994, based on a committee recommendation, the regulatory 
period was extended from May 20 to June 15 (59 FR 17265; April 12, 
1994). At that time, the committee believed that the application of 
quality control requirements over a longer time was necessary to 
enhance the South Texas onion industry's market research and promotion 
efforts, and protect its quality image. The committee also believed 
that District 2 handlers should pay assessments on more of their 
shipments for the research and promotion programs that benefit the 
entire industry.
    After one season's experience, District 2 growers and handlers 
requested the committee to reconsider the regulatory extension. 
Shipments made from District 2 compete with onions produced in West 
Texas and other areas of the United States not regulated under Federal 
marketing orders. Onion prices are usually quite low during this period 
and unregulated areas have a competitive advantage over District 2 
because inspection costs for quality control purposes and 
administrative assessments are not incurred by shippers from these 
areas. Ending regulations on June 4, rather than June

[[Page 24878]]

15, will relieve restrictions on District 2 shippers and help them 
become more competitive with shippers from these production areas 
without diminishing program objectives.
    Section 8e provides that whenever certain specified commodities, 
including onions, are regulated under a Federal marketing order, 
imports of that commodity must meet the same or comparable grade, size, 
quality, and maturity requirements as those in effect for the 
domestically produced commodity, subject to concurrence by the United 
States Trade Representative. The Act further provides that when two or 
more marketing orders covering the same commodity are concurrently in 
effect, imports will be subject to the requirements established for the 
commodity grown in the area with which the imported commodity is in 
most direct competition. Because this rule changes the regulatory 
period under the South Texas onion marketing order, corresponding 
changes will be needed in the onion import regulations. Such changes 
are addressed in a separate onion import rule.
    The proposed rule concerning this action was published in the 
February 20, 1996, Federal Register (61 FR 6328), with a 30-day comment 
period ending March 21, 1996. One comment was received in opposition to 
the proposed rule from a packer. The commenter stated that both South 
Texas and Idaho-Eastern Oregon successfully compete with onion 
producing areas that are not regulated. He further stated that he 
believed that the order was necessary to improve quality and thus make 
the production area a stronger competitor in the onion industry. The 
committee contends that this competition tends to bring about low 
prices to the late producing areas, and sometimes the addition of an 
administrative assessment and inspection fee may leave the shipper of 
late season South Texas onions at a competitive disadvantage. Thus, the 
committee believes that removing inspection and assessment requirements 
for a very short period will help shippers of late onions meet the 
competition from production areas outside of South Texas without 
diminishing program objectives.
    After thoroughly analyzing the comment received and other available 
information, the Department has concluded that ending the regulatory 
period on June 4, rather than June 15, as recommended by the committee 
will reduce the regulatory burden on late season shippers and help them 
compete more effectively with shippers from unregulated areas in the 
United States without adversely affecting the overall objectives of the 
marketing order. As mentioned earlier, onion prices are usually quite 
low late in the season and unregulated areas have a competitive 
advantage over the late season shippers from South Texas because 
inspection costs for quality control purposes and administrative 
assessments are not incurred by shippers from many of these areas.
    This final rule also changes the name of the largest size 
classification of onions under the handling regulation (7 CFR 
959.322(b)(5)) from ``Extra large'' to ``Colossal'' to bring that 
designation into conformity with the designation used in the U.S. 
Standards for Grades of Bermuda-Granex-Grano Type Onions (7 CFR 
51.3195-51.3209), and the U.S. Standards for Grades of Onions (Other 
Than Bermuda-Granex-Grano and Creole Types) (7 CFR 51.2830-51.2854). 
The standards were revised effective October 10, 1995 (60 FR 46976). 
One of the revisions was the addition of a new size classification 
called ``Colossal'' for onions 3\3/4\ inches or larger in diameter. A 
conforming change failed to be made in the handling regulations and 
onions of this size continued to be referred to as ``Extra large'' in 
paragraph (b)(5) of section 959.322. Hence, this term should be changed 
to ``Colossal'' to bring the handling regulation into conformity with 
the standards. The committee recommended this minor conforming change.
    In accordance with section 8e of the Act, the United States Trade 
Representative has concurred with the issuance of this final rule.
    Based on the above, the AMS has determined that this action will 
not have a significant economic impact on a substantial number of small 
entities.
    After consideration of all relevant matter presented, including the 
information and recommendations submitted by the commenter, 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 is further found that good cause exists 
for not postponing the effective date of this action until 30 days 
after publication in the Federal Register because: (1) This regulation 
relaxes restrictions on South Texas onion handlers by ending 
regulations on June 4 of each season rather than June 15 of each 
season; (2) the shipping season for South Texas onions has already 
begun and the committee would like this action effective for this 
season; (3) changing the ending date of the handling regulation was 
discussed at a public meeting, and all interested persons had an 
opportunity to provide input; and (4) there are no additional 
regulatory burdens imposed by this rule which require special 
preparations of handlers.

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 hereby 
amended as follows:

PART 959--ONIONS GROWN IN SOUTH TEXAS

    1. The authority citation for 7 CFR part 959 continues to read as 
follows:

    Authority: 7 U.S.C. 601-674.

    2. In Sec. 959.322, the introductory text and paragraph (b)(5) are 
revised to read as follows:


Sec. 959.322  Handling regulation.

    During the period beginning March 1 and ending June 4, no handler 
shall handle any onions unless they comply with paragraphs (a) through 
(d), or (e), or (f) of this section. In addition, no handler may 
package or load onions on Sunday during the period March 1 through May 
20.
* * * * *
    (b) * * *
    (5) ``Colossal''--3\3/4\ inches or larger in diameter.
* * * * *
    Dated: May 14, 1996.
Robert C. Keeney,
Director, Fruit and Vegetable Division.
[FR Doc. 96-12434 Filed 5-16-96; 8:45 am]
BILLING CODE 3410-02-P