[Federal Register Volume 74, Number 69 (Monday, April 13, 2009)]
[Proposed Rules]
[Pages 16798-16802]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-8171]


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DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 905

[Docket No. AO-85-A10; AMS-FV-07-0132; FV08-905-1]


Oranges, Grapefruit, Tangerines, and Tangelos Grown in Florida; 
Secretary's Decision and Referendum Order on Proposed Amendments to 
Marketing Agreement 84 and Order No. 905

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule and referendum order.

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SUMMARY: This decision proposes amendments to Marketing Agreement No. 
84 and Order No. 905 (order), which regulate the handling of oranges, 
grapefruit, tangerines, and tangelos (citrus) grown in Florida; and 
provides growers with the opportunity to vote in a referendum to 
determine if they favor the changes. The amendments are based on 
proposals by the Citrus Administrative Committee (committee), which is 
responsible for local administration of the order. These amendments 
would: (1) Modify committee representation by cooperative entities; (2) 
allow substitute alternates to temporarily represent absent members at 
committee meetings; (3) authorize the committee to conduct meetings by 
telephone or other means of communication; and (4) authorize the 
committee to conduct research and promotion programs, including paid 
advertising, for fresh Florida citrus. The amendments are intended to 
improve the operation and administration of the order and provide the 
industry with additional tools for the marketing of fresh citrus.

DATES: The referendum will be conducted from May 4 through May 18, 
2009. The representative period for the purpose of the referendum is 
August 1, 2007, through July 31, 2008.

ADDRESSES: Marketing Order Administration Branch, Fruit and Vegetable 
Programs, AMS, USDA, 1220 SW. Third Avenue, Room 385, Portland, OR 
97204.

FOR FURTHER INFORMATION CONTACT: Melissa Schmaedick, Marketing Order 
Administration Branch, Fruit and Vegetable Programs, AMS, USDA, 1220 
SW. Third Avenue, Room 385, Portland, Oregon 97204; Telephone: (503) 
326-2724, Fax: (503) 326-7440, or e-mail: 
[email protected]; or Laurel May, Marketing Order 
Administration Branch, Fruit and Vegetable Programs, AMS, USDA, 1400 
Independence Avenue, SW., Stop 0237, Washington, DC 20250-0237; 
Telephone: (202) 720-2491, fax: (202) 720-8938, or e-mail: 
[email protected].
    Small businesses may request information on this proceeding by 
contacting Jay Guerber, Marketing Order Administration Branch, Fruit 
and Vegetable Programs, AMS, USDA, 1400 Independence Avenue, SW., Stop 
0237, Washington, DC 20250-0237; Telephone: (202) 720-2491, fax: (202) 
720-8938, e-mail: [email protected].

SUPPLEMENTARY INFORMATION: Prior documents in this proceeding: Notice 
of Hearing issued on January 24, 2008, and published in the January 29, 
2008, issue of the Federal Register (73 FR 5130), and a Recommended 
Decision issued on December 19, 2008, and published in the December 24, 
2008, issue of the Federal Register (73 FR 79028).
    This action is governed by the provisions of sections 556 and 557 
of title 5 of the United States Code and is therefore excluded from the 
requirements of Executive Order 12866.

Preliminary Statement

    The proposed amendments are based on the record of a public hearing 
held February 12, 2008, in Winter Haven, Florida, to consider such 
amendments to the order. The hearing was held pursuant to the 
provisions of the Agricultural Marketing Agreement Act of 1937, as 
amended (7 U.S.C. 601-674), hereinafter referred to as the ``Act,'' and 
the applicable rules of practice and procedure governing the 
formulation of marketing agreements and orders (7 CFR part 900). The 
Notice of Hearing was published in the Federal Register on January 29, 
2008 (73 FR 5130), and contained amendment proposals submitted by the 
committee.
    The amendments included in this decision would:
    1. Modify committee representation by cooperative entities;
    2. Allow substitute alternates to temporarily represent absent 
members at committee meetings;
    3. Authorize the committee to conduct meetings by telephone or 
other means of communication; and
    4. Add authority for research and promotion programs, including 
paid advertising, for fresh Florida citrus.
    The Agricultural Marketing Service (AMS) also proposed to make such 
changes to the order as may be necessary, if any of the proposed 
changes are adopted, so that all of the order's provisions conform to 
the

[[Page 16799]]

effectuated amendments. AMS proposed replacing the word ``he'' in the 
second sentence of Sec.  905.22(a)(2) with ``he and she'', and 
replacing the word ``his'' in the last sentence of Sec.  905.22(b)(2) 
with the words ``his or her'' to conform to other proposed changes to 
that section.
    Upon the basis of evidence introduced at the hearing and the record 
thereof, the Administrator of AMS on December 19, 2008, filed with the 
Hearing Clerk, U.S. Department of Agriculture (USDA), a Recommended 
Decision and Opportunity to File Written Exceptions thereto by January 
23, 2009. None were filed.

Small Business Considerations

    Pursuant to the requirements set forth in the Regulatory 
Flexibility Act (5 U.S.C. 601-612) (RFA), AMS has considered the 
economic impact of this action 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 
business subject to such actions so that small businesses will not be 
unduly or disproportionately burdened. Marketing orders and amendments 
thereto are unique in that they are normally brought about through 
group action of essentially small entities for their own benefit.
    Small agricultural service firms, which include handlers regulated 
under the order, have been defined by the Small Business Administration 
(SBA) (13 CFR 121.201) as those having annual receipts of less than 
$7,000,000. Small agricultural producers have been defined as those 
with annual receipts of less than $750,000.
    There are approximately 48 handlers of fresh citrus subject to 
regulation under the order and approximately 7,700 producers of fresh 
citrus in the regulated area. Information provided at the hearing 
indicates that over 90 percent of the handlers would be considered 
small agricultural service firms. Hearing testimony also suggests that 
the majority of producers would also be considered small entities 
according to the SBA's definition.
    The order regulates the handling of fresh citrus grown in the state 
of Florida. Total bearing citrus acreage has declined from a peak of 
approximately 800,000 acres in 1996-97 to about 550,000 acres in 2006-
07, largely due to hurricane damage and the removal of diseased citrus 
trees. Approximately 7.236 million tons of citrus were produced in 
Florida during the 2006-07 season--a decline of approximately 6 million 
tons compared to the 1996-97 season. According to evidence provided at 
the hearing, approximately 10 percent of Florida citrus is used in the 
fresh market, while the remainder is used in the production of 
processed juice products. Generally, 40 percent of Florida's fresh 
citrus is shipped to export markets, including the Pacific Rim 
countries, Europe, and Canada.
    Under the order, outgoing quality regulations are established for 
fresh citrus shipments, and statistical information is collected. 
Program activities administered by the committee are designed to 
support large and small citrus producers and handlers. The 18-member 
committee is comprised of both producer and handler representatives 
from the production area, as well as a public member. Committee 
meetings where regulatory recommendations and other decisions are made 
are open to the public. All members are able to participate in 
committee deliberations, and each committee member has an equal vote. 
Others in attendance at meetings are also allowed to express their 
views.
    After discussions within the citrus industry, the committee 
considered developing its own research and marketing promotion programs 
focusing on fresh Florida citrus. An amendment study subcommittee was 
formed to explore this idea and other possible order revisions. The 
subcommittee developed a list of proposed amendments to the order, 
which was then presented to the committee and shared with other 
industry organizations. The proposed amendments were also posted on the 
committee's Web site for review by the Florida citrus industry at 
large.
    The committee met to review and discuss the subcommittee's 
proposals at its meeting on May 29, 2007. At that time, the committee 
voted unanimously to support the four proposed amendments that were 
forwarded to AMS.
    The proposed amendments are intended to provide the committee and 
the industry with additional flexibility in administering the order and 
producing and marketing fresh Florida citrus. Record evidence indicates 
that the proposals are intended to benefit all producers and handlers 
under the order, regardless of size.
    All producer and handler witnesses supported the proposed 
amendments at the hearing. Some witnesses commented on the implications 
of implementing specific marketing, research, and development programs. 
In that context, witnesses stated that they expected the benefits to 
producers and handlers to outweigh any potential costs.
    A description of the proposed amendments and their anticipated 
economic impact on small and large entities is discussed below.

Proposal 1--Cooperative Representation

    Proposal 1 would amend the order by reducing the required number of 
cooperative producer and cooperative handler seats on the committee 
from three each to two each.
    At the time the order was promulgated, there were numerous 
cooperative entities in the industry. The committee's original 
structure was designed to afford proportional representation for 
cooperative producers and handlers on the committee. The shrinking 
number of cooperatives entities, especially cooperative marketing 
entities, over time has prompted the committee to evaluate the 
appropriateness of the current committee structure. The committee 
believes that reducing the number of required cooperative seats on the 
committee would better reflect the current composition of the industry. 
The reduction would ensure that the interests of all large and small 
producers and handlers, whether independent or members of cooperatives, 
are represented appropriately during committee deliberations. Adoption 
of the proposed amendment would have no economic impact on producers or 
handlers of any size.

Proposal 2--Substitute Alternates

    Proposal 2 would amend the order by allowing members who are unable 
to attend committee meetings to designate available alternates to 
represent them if their own alternates are also unavailable in order to 
achieve a quorum. If members are unable to designate substitute 
alternates, the committee could designate substitutes at the meeting if 
necessary to secure a quorum. Substitute alternates would be required 
to represent the same group affiliation (producer or handler) as the 
absent members and alternates. Under current order provisions, only a 
member's respective alternate may represent the member if the member is 
unable to attend a meeting. There is no provision for a situation in 
which both the member and his or her alternate are unavailable for a 
meeting. In the past, meetings have been cancelled at the last minute 
because attendance was insufficient to meet quorum requirements.
    If implemented, the proposed amendment would allow alternates not 
otherwise representing absent members to represent other members at

[[Page 16800]]

committee meetings in order to secure a quorum. This would help ensure 
that quorum requirements could be met and that committee business could 
be addressed in a timely manner. This amendment would have no adverse 
economic impact on producers or handlers of any size.

Proposal Number 3--Telephone Meetings

    Proposal 3 would amend the order by adding authority to conduct 
committee meetings by telephone or other means of communication. 
Currently, the committee is limited to meeting in person, with 
provision for emergency voting by telephone. This amendment would give 
the committee greater flexibility in scheduling meetings and would be 
consistent with current practices in other citrus industry settings.
    Witnesses stated that using modern communication technology would 
allow the committee to respond more quickly to urgent industry needs 
and would provide greater access to meetings by members and other 
industry participants. Greater meeting flexibility would make it easier 
for the committee to hold additional meetings where there is a need for 
lengthier discussion and consensus building. The quorum and voting 
requirements specified for assembled meetings would also apply to 
meetings held via telephone or teleconference. The votes of members 
participating by telephone or other means of communication would be 
confirmed in writing. Faxes and e-mails would be considered acceptable 
forms of written vote confirmation by the committee.
    This amendment is expected to benefit producers and handlers of all 
sizes by improving committee efficiencies, encouraging greater 
participation in industry deliberations and is not expected to result 
in any significant increased costs to producers or handlers.

Proposal Number 4--Research and Promotion

    Proposal 4 would amend the order by adding authority to establish 
research and promotion programs. If this authority was implemented, the 
committee would be able to address the specific needs of the Florida 
fresh citrus industry by recommending, conducting, and funding research 
projects and promotional programs, including paid advertising, that 
focus on the production, handling, and marketing of fresh citrus.
    Witnesses testified that the committee's assessment rate would 
increase to cover the costs of any newly authorized research and 
promotion projects, and that there may be an offset by decreases in 
payments by the industry to fund projects through other entities. Any 
increased assessment costs would be based on the volume of fresh citrus 
shipped by each handler. Therefore, any increased costs would be 
applied proportionately to all handlers.
    Witnesses testified that the benefits expected to accrue to 
producers and handlers following implementation of this amendment would 
outweigh the costs. Witnesses advocated the establishment of production 
research programs that would assist with the development of new 
varieties and post-harvest handling methods to improve the 
marketability of fresh Florida citrus. Witnesses expect that marketing 
programs specific to fresh citrus would increase consumer demand and 
sales, which would in turn increase returns to producers and handlers. 
There was unanimous support for this proposal from witnesses at the 
hearing.
    Interested persons were invited to present evidence at the hearing 
on the probable regulatory and informational impact of the proposed 
amendments to the order on small entities. The record evidence is that 
implementation of the proposals to reallocate membership seats, 
authorize the use of substitute alternates, and authorize use of modern 
communication technology at meetings would have little or no impact on 
producers and handlers. Adding authority to conduct research and 
promotion programs would result in additional costs being imposed on 
handlers once implemented. Evidence provided at the hearing shows that 
committee expenses, and therefore handler assessments, would increase 
with the implementation of the proposal to authorize research and 
promotion programs. However, the record indicates that there may be an 
offset by decreases in payments to other industry entities now 
conducting research. Improved production and marketing strategies 
developed under the authorized programs would be expected to outweigh 
any additional costs to the Florida fresh citrus industry. In addition, 
any increased costs would be proportional to a handler's size and would 
not unduly or disproportionately impact small entities.
    USDA has not identified any relevant Federal rules that duplicate, 
overlap or conflict with this proposed rule. These amendments are 
intended to improve the operation and administration of the order and 
to assist in the marketing of fresh Florida citrus.

Paperwork Reduction Act

    Information collection requirements for Part 905 are currently 
approved by the Office of Management and Budget (OMB), under OMB Number 
0581-0189--``Generic OMB Fruit Crops.'' No changes in these 
requirements are anticipated as a result of this proceeding. Should any 
such changes become necessary, they would be submitted to OMB for 
approval.
    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 Government Paperwork 
Elimination Act (GPEA), which requires Government agencies in general 
to provide the public the option of submitting information or 
transacting business electronically to the maximum extent possible.
    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.

Civil Justice Reform

    The amendments to Marketing Agreement No. 84 and Marketing Order 
No. 905 proposed herein have been reviewed under Executive Order 12988, 
Civil Justice Reform. They are not intended to have retroactive effect. 
If adopted, the proposed amendments would not preempt any State or 
local laws, regulations, or policies, unless they present an 
irreconcilable conflict with this proposal.
    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 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. A 
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 no later than 20 days after the date of the 
entry of the ruling.

[[Page 16801]]

Findings and Conclusions

    The findings and conclusions, rulings, and general findings and 
determinations included in the Recommended Decision set forth in the 
December 24, 2008, issue of the Federal Register are hereby approved 
and adopted.

Marketing Agreement and Order

    Annexed hereto and made a part hereof is the document entitled 
``Order Amending the Order Regulating the Handling of Oranges, 
Grapefruit, Tangerines, and Tangelos Grown in Florida.'' This document 
has been decided upon as the detailed and appropriate means of 
effectuating the foregoing findings and conclusions.
    It is hereby ordered, that this entire decision be published in the 
Federal Register.

Referendum Order

    It is hereby directed that a referendum be conducted in accordance 
with the procedure for the conduct of referenda (7 CFR part 900.400-
407) to determine whether the annexed order amending the order 
regulating the handling of oranges, grapefruit, tangerines, and 
tangelos grown in Florida is approved or favored by producers, as 
defined under the terms of the order, who during the representative 
period where engaged in the production of citrus in the production 
area.
    The representative period for the conduct of such referendum is 
hereby determined to be August 1, 2007, though July 31, 2008.
    The agents of the Secretary to conduct such referendum are hereby 
designated to be Christian Nissen and Doris Jamieson, Southeast 
Marketing Field Office, Marketing Order Administration Branch, Fruit 
and Vegetable Programs, AMS, USDA; Telephone: (863) 324-3375, Fax: 
(863) 325-8793, or E-mail: [email protected] or 
[email protected], respectively.

List of Subjects in 7 CFR Part 905

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

    Dated: April 6, 2009.
Robert C. Keeney,
Acting Associate Administrator.

Order Amending the Order Regulating the Handling of Oranges, 
Grapefruit, Tangerines, and Tangelos Grown in Florida \1\
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    \1\ This order shall not become effective unless and until the 
requirements of Sec.  900.14 of the rules of practice and procedure 
governing proceedings to formulate marketing agreements and 
marketing orders have been met.
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Findings and Determinations

    The findings and determinations hereinafter set forth are 
supplementary to the findings and determinations that were previously 
made in connection with the issuance of the marketing order; and all 
said previous findings and determinations are hereby ratified and 
affirmed, except insofar as such findings and determinations may be in 
conflict with the findings and determinations set forth herein.
    (a) Findings and Determinations Upon the Basis of the Hearing 
Record.
    Pursuant to the provisions of the Agricultural marketing Agreement 
Act of 1937, as amended (7 U.S.C. 601-612), and the applicable rules of 
practice and procedure effective thereunder (7 CFR part 900), a public 
hearing was held upon proposed further amendment of Marketing Agreement 
No. 84 and Marketing Order No. 905, regulating the handling of oranges, 
grapefruit, tangerines, and tangelos grown in Florida.
    Upon the basis of the record, it is found that:
    (1) The marketing agreement and order, as amended, and as hereby 
proposed to be further amended, and all of the terms and conditions 
thereof, would tend to effectuate the declared policy of the Act;
    (2) The marketing agreement and order, as amended, and as hereby 
proposed to be further amended, regulate the handling of oranges, 
grapefruit, tangerines, and tangelos grown in the production area in 
the same manner as, and are applicable only to, persons in the 
respective classes of commercial and industrial activity specified in 
the marketing agreement and order upon which a hearing has been held;
    (3) The marketing agreement and order, as amended, and as hereby 
proposed to be further amended, are limited in their application to the 
smallest regional production area that is practicable, consistent with 
carrying out the declared policy of the Act, and the issuance of 
several orders applicable to subdivisions of the production area would 
not effectively carry out the declared policy of the Act;
    (4) The marketing agreement and order, as amended, and as hereby 
proposed to be further amended, prescribe, insofar as practicable, such 
different terms applicable to different parts of the production area as 
are necessary to give due recognition to the differences in the 
production and marketing of oranges, grapefruit, tangerines, and 
tangelos grown in the production area; and
    (5) All handling of oranges, grapefruit, tangerines, and tangelos 
grown in the production area as defined in the marketing agreement and 
order is in the current of interstate or foreign commerce or directly 
burdens, obstructs, or affects such commerce.

Order Relative to Handling

    It is therefore ordered, That on and after the effective date 
hereof, all handling of oranges, grapefruit, tangerines, and tangelos 
grown in Florida shall be in conformity to, and in compliance with, the 
terms and conditions of the said order as hereby proposed to be amended 
as follows:
    The provisions of the proposed marketing agreement and order 
amending the order contained in the Recommended Decision issued by the 
Administrator on December 19, 2008, and published in the Federal 
Register on December 24, 2008, will be and are the terms and provisions 
of this order amending the order and are set forth in full herein.

PART 905--ORANGES, GRAPEFRUIT, TANGERINES, AND TANGELOS GROWN IN 
FLORIDA

    1. The authority citation for 7 CFR part 905 continues to read as 
follows:

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

    2. Amend Sec.  905.22 by revising paragraphs (a)(2) and (b)(2) to 
read as follows:


Sec.  905.22  Nominations.

    (a) * * *
    (1) * * *
    (2) Each nominee shall be a producer in the district from which he 
or she is nominated. In voting for nominees, each producer shall be 
entitled to cast one vote for each nominee in each of the districts in 
which he or she is a producer. At least two of the nominees and their 
alternates so nominated shall be affiliated with a bona fide 
cooperative marketing organization.
    (b) * * *
    (1) * * *
    (2) Nomination of at least two members and their alternates shall 
be

[[Page 16802]]

made by bona fide cooperative marketing organizations which are 
handlers. Nominations for not more than six members and their 
alternates shall be made by handlers who are not so affiliated. In 
voting for nominees, each handler or his or her authorized 
representative shall be entitled to cast one vote, which shall be 
weighted by the volume of fruit by such handler during the then current 
fiscal period.
    3. Revise Sec.  905.23 to read as follows:


Sec.  905.23  Selection.

    (a) From the nominations made pursuant to Sec.  905.22(a) or from 
other qualified persons, the Secretary shall select one member and one 
alternate member to represent District 2 and two members and two 
alternate members each to represent Districts 1, 3, 4, and 5 or such 
other number of members and alternate members from each district as may 
be prescribed pursuant to Sec.  905.14. At least two such members and 
their alternates shall be affiliated with bona fide cooperative 
marketing organizations.
    (b) From the nominations made pursuant to Sec.  905.22 (b) or from 
other qualified persons, the Secretary shall select at least two 
members and their alternates to represent bona fide cooperative 
marketing organizations which are handlers, and the remaining members 
and their alternates to represent handlers who are not so affiliated.
    4. In Sec.  905.29, redesignate paragraph (b) as paragraph (c), and 
add a new paragraph (b) to read as follows:


Sec.  905.29  Inability of members to serve.

* * * * *
    (b) If both a member and his or her respective alternate are unable 
to attend a committee meeting, such member may designate another 
alternate to act in his or her place in order to obtain a quorum: 
Provided, That such alternate member represents the same group 
affiliation as the absent member. If the member is unable to designate 
such an alternate, the committee members present may designate such 
alternate.
* * * * *
    5. Revise paragraph (c) of Sec.  905.34 to read as follows:


Sec.  905.34  Procedure of committees.

* * * * *
    (c) The committee may provide for meeting by telephone, telegraph, 
or other means of communication, and any vote cast at such a meeting 
shall be promptly confirmed in writing: Provided, That if any assembled 
meeting is held, all votes shall be cast in person.
* * * * *
    6. Add a new Sec.  905.54 to read as follows:


Sec.  905.54  Marketing, research and development.

    The committee may, with the approval of the Secretary, establish, 
or provide for the establishment of, projects including production 
research, marketing research and development projects, and marketing 
promotion including paid advertising, designed to assist, improve, or 
promote the marketing, distribution, and consumption or efficient 
production of fruit. The expenses of such projects shall be paid by 
funds collected pursuant to Sec.  905.41. Upon conclusion of each 
project, but at least annually, the committee shall summarize the 
program status and accomplishments to its members and the Secretary. A 
similar report to the committee shall be required of any contracting 
party on any project carried out under this section. Also, for each 
project, the contracting party shall be required to maintain records of 
money received and expenditures, and such shall be available to the 
committee and the Secretary.

[FR Doc. E9-8171 Filed 4-10-09; 8:45 am]
BILLING CODE 3410-02-P