[Federal Register Volume 63, Number 94 (Friday, May 15, 1998)]
[Proposed Rules]
[Pages 26999-27001]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-13005]


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 Proposed Rules
                                                 Federal Register
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 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. 63, No. 94 / Friday, May 15, 1998 / Proposed 
Rules  

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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 958

[Docket No. FV98-958-1 PR]


Onions Grown in Certain Designated Counties in Idaho, and Malheur 
County, Oregon; Decreased Assessment Rate

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule.

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SUMMARY: This rule would decrease the assessment rate established for 
the Idaho-Eastern Oregon Onion Committee (Committee) under Marketing 
Order No. 958 for the 1998-99 and subsequent fiscal periods from $0.10 
to $0.09 per hundredweight of onions handled. The Committee is 
responsible for local administration of the marketing order which 
regulates the handling of onions grown in designated counties in Idaho, 
and Malheur County, Oregon.
    Authorization to assess Idaho-Eastern Oregon onion handlers enables 
the Committee to incur expenses that are reasonable and necessary to 
administer the program. The fiscal period begins July 1 and ends June 
30. The assessment rate would remain in effect indefinitely unless 
modified, suspended, or terminated.

DATES: Comments must be received by June 1, 1998.

ADDRESSES: Interested persons are invited to submit written comments 
concerning this rule. Comments must be sent to the Docket Clerk, Fruit 
and Vegetable Programs, AMS, USDA, room 2525-S, P.O. Box 96456, 
Washington, DC 20090-6456; Fax: (202) 205-6632. Comments should 
reference the docket number and the date and page number of this issue 
of the Federal Register and will be available for public inspection in 
the Office of the Docket Clerk during regular business hours.

FOR FURTHER INFORMATION CONTACT: Robert J. Curry, Northwest Marketing 
Field Office, Marketing Order Administration Branch, Fruit and 
Vegetable Programs, AMS, USDA, 1220 SW Third Avenue, room 369, 
Portland, Oregon 97204-2807; telephone: (503) 326-2724, Fax: (503) 326-
7440; or George Kelhart, Marketing Order Administration Branch, Fruit 
and Vegetable Programs, AMS, USDA, room 2525-S, P.O. Box 96456, 
Washington, DC 20090-6456; telephone: (202) 720-2491, Fax: (202) 205-
6632. Small businesses may request information on compliance with this 
regulation by contacting Jay Guerber, Marketing Order Administration 
Branch, Fruit and Vegetable Programs, AMS, USDA, room 2525-S, P.O. Box 
96456, Washington, DC 20090-6456; telephone: (202) 720-2491, Fax: (202) 
205-6632.

SUPPLEMENTARY INFORMATION: This rule is issued under Marketing 
Agreement and Order No. 958 (7 CFR part 958), regulating the handling 
of onions grown in certain designated counties in Idaho, and Malheur 
County, Oregon, 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 rule in 
conformance with Executive Order 12866.
    This rule has been reviewed under Executive Order 12988, Civil 
Justice Reform. Under the order now in effect, Idaho-Eastern Oregon 
onion handlers are subject to assessments. Funds to administer the 
order are derived from such assessments. It is intended that the 
assessment rate proposed herein would be applicable to all assessable 
onions beginning on July 1, 1998, and continue until amended, 
suspended, or terminated. This rule would 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. Such 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 the date of the entry of the ruling.
    This rule would decrease the assessment rate established for the 
Committee for the 1998-99 and subsequent fiscal periods from $0.10 per 
hundredweight to $0.09 per hundredweight of onions handled.
    The order provides authority for the Committee, with the approval 
of the Department, to formulate an annual budget of expenses and 
collect assessments from handlers to administer the program. The 
Committee consists of six producer members, four handler members and 
one public member, each of whom is familiar with the Committee's needs 
and with the costs for goods and services in their local area and are 
thus in a position to formulate an appropriate budget and assessment 
rate. The budget and assessment rate were discussed at a public meeting 
and all directly affected persons had an opportunity to participate and 
provide input.
    For the 1996-97 and subsequent fiscal periods, the Committee 
recommended, and the Department approved, an assessment rate of $0.10 
per hundredweight that would continue in effect from fiscal period to 
fiscal period unless modified, suspended, or terminated by the 
Secretary upon recommendation and information submitted by the 
Committee or other information available to the Secretary.
    The Committee met on April 2, 1998, and unanimously recommended 
1998-99 expenditures of $1,155,205 and an assessment rate of $0.09 per 
hundredweight of onions handled during the 1998-99 and subsequent 
fiscal periods. The Committee estimated that the 1998-99 onion crop 
will approximate 9,200,000 hundredweight of onions. In comparison, the 
1997-98 fiscal period budget was established at $1,146,916 on an 
estimated assessable onion harvest of 8,800,000 hundredweight of 
onions. The decrease is necessary to prevent expected

[[Page 27000]]

assessment income from exceeding the amount necessary to administer the 
program for the 1998-99 fiscal period.
    The Committee anticipates that assessment income during the 1997-98 
fiscal period will be approximately $100,000 higher than that estimated 
for its 1997-98 budget. This is due to a greater level of onion 
production than anticipated by the Committee during its 1997-98 budget 
deliberations. The Committee also anticipates that it will not expend 
$1,146,916 as budgeted for the 1997-98 fiscal period, but rather will 
have expenditures totaling approximately $950,000. At the time the 
1997-98 fiscal period budget was recommended, the Committee had 
estimated that it would draw up to $216,916 from its operating reserve. 
However, since current assessment income is greater than anticipated 
and expenditures are less than budgeted, the operating reserve may 
actually increase by the end of the fiscal period rather than decrease. 
As a consequence, the Committee has estimated that its operating 
reserve will approximate $1,141,700 by June 30, 1998. Thus, to help 
ensure that the operating reserve does not exceed the maximum allowed 
by the order of approximately one fiscal period's expenditures, the 
Committee recommended that the assessment rate be decreased. Lower 
assessment rates were considered, but not recommended because they 
would not generate the income necessary to administer the program with 
an adequate operating reserve.
    The major expenditures recommended by the Committee for the 1998-99 
fiscal period include $215,205 for administration, $55,000 for 
production research, $750,000 for market promotion including paid 
advertising, $60,000 for export market development, and $75,000 for 
marketing order contingencies. Budgeted expenses for these items in the 
1997-98 fiscal period were $206,716, $55,200, $750,000, $60,000, and 
$75,000, respectively.
    The Committee has based its recommended assessment rate decrease on 
the 1998-99 crop estimate, the 1998-99 fiscal period expenditures 
estimate, as well as the current and projected balance of the operating 
reserve. The decreased assessment rate should provide $828,000 in 
income, which, when combined with interest income of $55,000 and 
operating reserve funds of $272,205, would be adequate to cover 
budgeted expenses. As noted above, the Committee estimates it will have 
approximately $1,141,700 in its operating reserve at the end of the 
current fiscal period, which should be adequate to cover any income 
shortages. This amount is within the maximum permitted by the order of 
approximately one fiscal period's expenditures (Sec. 958.44).
    The proposed assessment rate would continue in effect indefinitely 
unless modified, suspended, or terminated by the Secretary 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 the 
Department and are locally published. Committee meetings are open to 
the public and interested persons may express their views at these 
meetings. The Department 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.
    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA), the Agricultural Marketing Service (AMS) has considered the 
economic impact this rule would have on small entities. Accordingly, 
the AMS has prepared this initial regulatory flexibility analysis.
    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 the 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 35 handlers of Idaho-Eastern Oregon onions 
who are subject to regulation under the order and approximately 260 
onion producers in the regulated production area. Small agricultural 
service firms 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 Idaho-
Eastern Oregon onion handlers and producers may be classified as small 
entities.
    This rule would decrease the assessment rate established for the 
Committee and collected from handlers for the 1998-99 and subsequent 
fiscal periods from $0.10 per hundredweight to $0.09 per hundredweight 
of onions handled. Both the $0.09 assessment rate and the 1998-99 
budget of $1,155,205 were unanimously recommended by the Committee at 
its April 2, 1998, meeting. The proposed assessment rate is $0.01 lower 
than the rate currently in effect. The Committee recommended a 
decreased assessment rate to help ensure that the operating reserve 
does not exceed the maximum allowed by the order of approximately one 
fiscal period's expenditures. The anticipated crop of 9,200,000 
hundredweight is approximately 400,000 hundredweight larger than the 
crop estimate used to establish the 1997-98 budget. The $0.09 rate 
should provide $828,000 in assessment income, which, when combined with 
interest income of $55,000 and $272,205 from the operating reserve, 
would be adequate to meet the 1998-99 fiscal period's budgeted 
expenses.
    The Committee reviewed and unanimously recommended 1998-99 
expenditures of $1,155,205 which includes increases in administrative 
expenses, salaries, and committee expenses. Prior to recommending this 
budget, the Committee considered information from various sources, 
including the Idaho-Eastern Oregon Onion Executive, Research, Promotion 
and Export Development Committees. Alternative expenditure levels were 
discussed and rejected by these subcommittees, and ultimately by the 
full Committee, based upon the relative value of various research and 
promotion projects to the Idaho-Eastern Oregon onion industry.
    The major expenditures recommended by the Committee for the 1998-99 
fiscal period include $215,205 for administration, $55,000 for 
production research, $750,000 for market promotion including paid 
advertising, $60,000 for export market development, and $75,000 for 
marketing order contingencies. Budgeted expenses for these items in the 
1997-98 fiscal period were $206,716, $55,200, $750,000, $60,000, and 
$75,000, respectively.
    A review of historical information and preliminary information 
pertaining to the upcoming season indicates that the F.O.B. price for 
the 1998-99 onion season could average $13.10 per hundredweight of 
onions. Therefore, the estimated assessment revenue for the 1998-99 
fiscal period ($828,000) as a percentage of the projected total F.O.B. 
revenue ($120,520,000) would be 0.007 percent. This figure indicates 
that the $0.09 assessment rate recommended by the Committee would have 
a relatively

[[Page 27001]]

insignificant impact on the Idaho-Eastern Oregon onion industry.
    This action would decrease the assessment obligation imposed on 
handlers. While assessments impose some additional costs on handlers, 
the costs are minimal and uniform on all handlers. Some of the 
additional costs may be passed on to producers. However, these costs 
would be offset by the benefits derived by the operation of the order. 
In addition, the Committee's meeting was widely publicized throughout 
the Idaho-Eastern Oregon onion industry and all interested persons were 
invited to attend the meeting and participate in Committee 
deliberations on all issues. Like all Committee meetings, the April 2, 
1998, 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 information on the regulatory and 
informational impacts of this action on small businesses.
    This proposed rule would impose no additional reporting or 
recordkeeping requirements on either small or large 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.
    The Department has not identified any relevant Federal rules that 
duplicate, overlap, or conflict with this rule.
    A 15-day comment period is provided to allow interested persons the 
opportunity to respond to this request for information and comments. 
Fifteen days is deemed appropriate because: (1) The Committee needs to 
have sufficient funds to pay its expenses which are incurred on a 
continuous basis; (2) the 1998-99 fiscal period begins on July 1, 1998, 
and the order requires that the rate of assessment for each fiscal 
period apply to all assessable onions handled during such fiscal 
period; and (3) handlers are aware of this action which was recommended 
by the Committee at a public meeting and is similar to other assessment 
rate actions issued in past years.

List of Subjects in 7 CFR Part 958

    Marketing agreements, Onions, Reporting and recordkeeping 
requirements.

    For the reasons set forth in the preamble, 7 CFR part 958 is 
proposed to be amended as follows:

PART 958--ONIONS GROWN IN CERTAIN DESIGNATED COUNTIES IN IDAHO, AND 
MALHEUR COUNTY, OREGON

    1. The authority citation for 7 CFR part 958 continues to read as 
follows:

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

    2. Section 958.240 is proposed to be revised to read as follows:


Sec. 958.240  Assessment rate.

    On and after July 1, 1998, an assessment rate of $0.09 per 
hundredweight is established for Idaho-Eastern Oregon onions.

    Dated: May 11, 1998.
Robert C. Keeney,
Deputy Administrator, Fruit and Vegetable Programs.
[FR Doc. 98-13005 Filed 5-14-98; 8:45 am]
BILLING CODE 3410-02-P