[Federal Register Volume 61, Number 234 (Wednesday, December 4, 1996)]
[Rules and Regulations]
[Pages 64253-64255]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-30859]


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DEPARTMENT OF AGRICULTURE
7 CFR Part 906

[Docket No. FV96-906-2FR]


Oranges and Grapefruit Grown in the Lower Rio Grande Valley in 
Texas; Change in Reporting Requirements

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

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SUMMARY: This final rule changes the reporting requirements currently 
prescribed under the Texas orange and grapefruit marketing order. The 
marketing order regulates the handling of oranges and grapefruit grown 
in three counties in the Lower Rio Grande Valley in Texas and is 
administered locally by the Texas Valley Citrus Committee (committee). 
Shipments of oranges and grapefruit out of the production area must 
meet minimum standards of grade, size, quality, and pack. Such 
shipments are subject to mandatory inspection. This final rule adds 
language in the

[[Page 64254]]

order's rules and regulations to require that all sales of over 400 
pounds of oranges and grapefruit for resale inside the production area 
be covered by a ``Buyer Certification'' form (Certification Form). This 
requirement will ensure that handlers are aware of and accept 
responsibility for complying with the order's requirements and that 
buyers do not transport uninspected oranges and grapefruit out of the 
three-county production area.

EFFECTIVE DATE: This final rule becomes effective December 5, 1996.

FOR FURTHER INFORMATION CONTACT: Belinda G. Garza, McAllen Marketing 
Field Office, Marketing Order Administration Branch, Fruit and 
Vegetable Division, 1313 E. Hackberry, McAllen, Texas 78501; telephone: 
(210) 682-2833, Fax # (210) 682-5942; or Charles L. Rush, Marketing 
Order Administration Branch, Fruit and Vegetable Division, AMS, USDA, 
room 2525-S, P.O. Box 96456, Washington, DC 20090-6456; telephone: 
(202) 690-3670, Fax # (202) 720-5698. Small businesses may request 
information on compliance with this regulation by contacting: Jay 
Guerber, Marketing Order Administration Branch, Fruit and Vegetable 
Division, AMS, USDA, P.O. Box 96456, room 2525-S, Washington, DC 20090-
6456; telephone (202) 720-2491; Fax # (202) 720-5698.

SUPPLEMENTARY INFORMATION: This final rule is issued under Marketing 
Agreement and Order No. 906 (7 CFR Part 906), as amended, regulating 
the handling of oranges and grapefruit grown in the Lower Rio Grande 
Valley in 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 (Department) is issuing this final 
rule in conformance with Executive Order 12866.
    This final rule has been reviewed under Executive Order 12988, 
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 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 the Secretary's 
ruling on the petition, provided an action is filed not later than 20 
days after date of the entry of the ruling.
    Pursuant to the requirements set forth in the Regulatory 
Flexibility Act (RFA), the Agricultural Marketing Service (AMS) has 
considered the economic impact of this final rule 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 approximately 15 handlers of oranges and grapefruit who 
are subject to regulation under the order and approximately 2,000 
orange and grapefruit 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 Texas oranges and 
grapefruit may be classified as small entities.
    This final rule establishes a requirement that handlers (sellers) 
complete a Certification Form on all sales of over 400 pounds of 
oranges or grapefruit, or both, destined for resale inside the 
production area to help ensure that such oranges or grapefruit do not 
leave the production area without meeting order requirements. The use 
of this new form was unanimously recommended by the committee at a 
public meeting on May 29, 1996.
    Implementation of the requirement to submit Certification Forms 
will result in a small increase in reporting requirements imposed on 
handlers. The added cost of complying with this requirement will be 
minimal and will be offset by benefits derived from enhanced compliance 
with the order and more complete statistical data beneficial to the 
entire industry. Therefore, the AMS has determined that this action 
will not have a significant economic impact on a substantial number of 
small entities.
    Under the order, Texas orange and grapefruit shipments to fresh 
markets in the United States, Canada, and Mexico are required to be 
inspected and are subject to grade, size, quality, container and pack 
requirements. Exempt from such handling requirements are shipments 
made: (1) within the production area (Cameron, Hidalgo, and Willacy 
counties in Texas); (2) in individually addressed gift packages which 
are not for resale; (3) under the 400-pound minimum quantity exemption 
provision; and (4) for relief or charity. In addition, fruit shipped to 
approved processors for processing are exempt from handling 
requirements. These handling requirements do not change substantially 
from season to season, and are in effect on a continuing basis subject 
to amendment, modification, or suspension as may be determined by the 
Secretary. Currently, the handling regulations under the order are 
effective from September 1 through June 30 each year.
    Section 906.51 of the order provides authority for the committee, 
with the approval of the Secretary, to require that each handler 
furnish to the committee reports and other information as may be 
necessary for the committee to perform its duties under the marketing 
order.
    The committee recommended the establishment of a requirement that 
handlers of Texas oranges and grapefruit complete a Certification Form 
on all sales of over 400 pounds of oranges or grapefruit or a 
combination of both that are not intended to leave the production area. 
(The order currently provides that 400 pounds of Texas oranges or 
grapefruit or a combination of both not for resale may be shipped per 
day outside the production area without having to meet marketing order 
requirements.) The form will require the following information: (1) 
names and addresses of the seller and the buyer; (2) description and 
quantity of the oranges or grapefruit sold; and (3) the destination of 
the fruit. In addition, the buyer will certify that fruit that is 
subsequently taken outside the production area for resale will be 
inspected in accordance with the order and its rules and regulations. 
The information compiled from use of this form will also provide the 
committee, its staff, and the industry with valuable statistics on 
fruit sold and marketed within the production area.
    Handling of oranges and grapefruit inside the production area is 
not

[[Page 64255]]

regulated. While monitoring compliance during the 1995-96 season, 
committee staff became aware of a lack of documentation on fruit 
intended for use within the production area. Such fruit was on occasion 
found outside the production area without having been inspected and 
certified as meeting marketing order requirements. The committee 
recognized the need to make handlers responsible for ensuring that 
sales of their fruit intended for resale inside the production area, 
but subsequently leaving the production area, meet the provisions of 
the order. The Certification Form was developed to help track such 
sales. Currently, documentation on sales to peddlers and cash buyers, 
and other transactions not supported by an inspection certificate or a 
diversion report (used to track shipments for processing, relief, or 
charity), is minimal or non-existent. In the process of conducting its 
compliance program, the committee encountered difficulty in tracking 
movement of such citrus and detecting violations of the order.
    The form will be completed by the seller (handler) in triplicate. 
The buyer will sign the certification statement on the form. One copy 
will be submitted by the handler to the committee within 7 days after 
the sale. One copy will be retained by the handler and the third copy 
will be given to the buyer. The forms will be reviewed by the 
committee's compliance staff as they are received and will be compared 
against handler records and inspection certificates. In addition, the 
form will also provide valuable statistical information on fruit sold 
and marketed for use within the production area. Currently, there is no 
tracking system for local use fruit. Collection of this information 
will fill a void in the committee's statistical database which will be 
used to determine total utilization of fruit and further assist the 
industry in making marketing decisions.
    Throughout the past season, the committee considered possible 
options to monitor shipments of uninspected oranges and grapefruit. It 
was noted that local use fruit is presently not accounted for, which 
leaves a significant void in the committee's database. The committee 
considered, for example, compiling an ``approved peddler'' list, and 
allowing uninspected fruit to be sold only to those appearing on the 
list. This option was determined to be impractical for the industry, as 
such a list would change constantly and could never be accurately 
maintained. Development of the Certification Form was the only option 
believed to be viable. Use of the form will raise awareness of both the 
sellers' and buyers' responsibility to comply with the provisions of 
the marketing order. This option will result in the smallest increase 
in regulatory burden of the options considered, including the 
establishment of additional regulatory requirements, such as inspection 
of all shipments, regardless of destination. Therefore, the committee 
recommended that Sec. 906.151 be amended by designating the existing 
paragraph in this section as (a) and adding a new paragraph (b).
    The proposed rule concerning this action was published in the 
September 18, 1996, Federal Register (61 FR 49078), with a 30-day 
comment period ending October 18, 1996. No comments were received. The 
proposed rule also announced AMS's intention to request a revision to 
the currently approved information collection requirements issued under 
the marketing order. The informal collection requirements in the 
referenced section have been approved by the Office of Management and 
Budget (OMB) under the provisions of 44 U.S.C. Chapter 35 and have been 
assigned OMB No. 0581-0068.
    After consideration of all relevant matter presented, including the 
information and recommendations 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.
    It is further found that good cause exists for not postponing the 
effective date of this rule until 30 days after publication in the 
Federal Register (5 U.S.C. 553) because: (1) the Texas citrus shipping 
season began in mid-September; (2) this rule was unanimously 
recommended by the committee at a public meeting and all interested 
persons had an opportunity to express their views and provide input; 
(3) Texas orange and grapefruit handlers are aware of this rule and 
need no additional time to comply with the requirements; and (4) a 30-
day comment period was provided for in the proposed rule and no 
comments were received.

List of Subjects in 7 CFR Part 906

    Grapefruit, Marketing agreements, Oranges, Reporting and 
recordkeeping requirements.

    For the reasons set forth in the preamble, 7 CFR part 906 is 
amended as follows:

PART 906--ORANGES AND GRAPEFRUIT GROWN IN THE LOWER RIO GRANDE 
VALLEY IN TEXAS

    1. The authority citation for 7 CFR part 906 continues to read as 
follows:

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

    2. In Sec. 906.151 the existing text is designated as paragraph (a) 
and new paragraphs (b) and (c) are added to read as follows:


Sec. 906.151  Reports.

* * * * *
    (b) Each handler who sells over 400 pounds of oranges or grapefruit 
or a combination of both for resale inside the production area shall, 
for each transaction, report to the committee on a form approved by it 
the following information:
    (1) Name and address of seller;
    (2) Name and address of buyer;
    (3) Description and quantity of oranges or grapefruit sold;
    (4) Destination of fruit;
    (5) A statement that the buyer certifies that fruit that is 
subsequently taken outside the production area for resale will be 
inspected; and
    (6) Such other pertinent information as the committee may require.
    (c) The handler shall prepare the report in triplicate. The buyer 
shall sign the certification statement. The pink copy shall be 
submitted to the committee within 7 days. The green copy shall be 
retained by the handler and the blue copy shall be given to the buyer. 
Such form shall be reviewed by the committee staff and the information 
compiled for the committee's use.

    Dated: November 27, 1996.
Robert C. Keeney,
Director, Fruit and Vegetable Division.
[FR Doc. 96-30859 Filed 12-3-96; 8:45 am]
BILLING CODE 3410-02-P