[Federal Register Volume 77, Number 239 (Wednesday, December 12, 2012)]
[Proposed Rules]
[Pages 73961-73965]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-29244]


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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. 77, No. 239 / Wednesday, December 12, 2012 / 
Proposed Rules  

[[Page 73961]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 905

[Docket No. AMS-FV-11-0076; FV11-905-1 PR]


Oranges, Grapefruit, Tangerines, and Tangelos Grown in Florida; 
Redistricting and Reapportionment of Grower Members, and Changing the 
Qualifications for Grower Membership on the Citrus Administrative 
Committee

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule.

-----------------------------------------------------------------------

SUMMARY: This proposed rule would redefine districts, reapportion 
representation, and modify the qualifications for membership on the 
Citrus Administrative Committee (Committee). The Committee is 
responsible for local administration of the Federal marketing order for 
oranges, grapefruit, tangerines, and tangelos grown in Florida (order). 
This rule would reduce the number of districts, reapportion 
representation among the districts, and allow up to four growers who 
are shippers or employees of a shipper to serve as grower members on 
the Committee. These changes would adjust grower representation to 
reflect the composition of the industry, provide equitable 
representation from each district, and create the opportunity for more 
growers to serve on the Committee.

DATES: Comments must be received by January 11, 2013.

ADDRESSES: Interested persons are invited to submit written comments 
concerning this proposal. Comments must be sent to the Docket Clerk, 
Marketing Order and Agreement Division, Fruit and Vegetable Program, 
AMS, USDA, 1400 Independence Avenue SW., STOP 0237, Washington, DC 
20250-0237; Fax: (202) 720-8938; or Internet: http://www.regulations.gov. All comments should reference the document number 
and the date and page number of this issue of the Federal Register and 
will be made available for public inspection in the Office of the 
Docket Clerk during regular business hours, or can be viewed at: http://www.regulations.gov. All comments submitted in response to this rule 
will be included in the record and will be made available to the 
public. 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: Corey E. Elliott, Marketing 
Specialist, or Christian D. Nissen, Regional Director, Southeast 
Marketing Field Office, Marketing Order and Agreement Division, Fruit 
and Vegetable Program, AMS, USDA; Telephone: (863) 324-3375, Fax: (863) 
325-8793, or Email: [email protected] or 
[email protected].
    Small businesses may request information on complying with this 
regulation by contacting Laurel May, Marketing Order and Agreement 
Division, Fruit and Vegetable Program, AMS, USDA, 1400 Independence 
Avenue SW., STOP 0237, Washington, DC 20250-0237; Telephone: (202) 720-
2491, Fax: (202)720-8938, or Email: [email protected].

SUPPLEMENTARY INFORMATION: This proposal is issued under Marketing 
Order No. 905, as amended (7 CFR part 905), regulating the handling of 
oranges, grapefruit, tangerines, and tangelos grown in Florida, 
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 (USDA) is issuing this rule in 
conformance with Executive Order 12866.
    This proposal has been reviewed under Executive Order 12988, Civil 
Justice Reform. This rule is not intended to have retroactive effect.
    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 not later than 20 days after the date of 
the entry of the ruling.
    This proposed rule would redefine districts, reapportion 
representation, and modify the qualifications for membership on the 
Committee. This rule would reduce the number of districts, reapportion 
grower representation among the districts, and allow up to four growers 
who are shippers or employees of a shipper to serve as grower members 
on the Committee. These changes would adjust grower representation to 
reflect the composition of the industry, provide equitable 
representation from each district, and create the opportunity for more 
growers to serve on the Committee. These changes were unanimously 
recommended by the Committee at a meeting on July 14, 2011.
    Section 905.14 of the order provides the authority to redefine the 
districts into which the production area is divided and to reapportion 
or otherwise change the grower membership of the districts to assure 
equitable grower representation on the Committee. This section also 
provides that such changes are to be based, so far as practicable, on 
the averages for the immediately preceding five fiscal periods of: (1) 
The volume of fruit shipped from each district; (2) the volume of fruit 
produced in each district; and, (3) the total number of acres of citrus 
in each district. It also requires that the Committee consider such 
redistricting and reapportionment during the 1980-81 fiscal period and 
only in each fifth fiscal period thereafter. The recommendation of July 
14, 2011, is consistent with the time requirements of this section.
    Section 905.19 provides for the establishment of and membership on 
the Committee, including the number of grower and handler members and 
their corresponding qualifications to serve. In

[[Page 73962]]

addition, this section provides the authority for the Committee, with 
the approval of the Secretary, to establish alternative qualifications 
for grower members. Current qualifications specify that grower members 
cannot be shippers or employees of shippers.
    Currently, Sec.  905.114 of the order's administrative rules and 
regulations lists and defines four grower districts within the 
production area. District One includes the counties of Hillsborough, 
Pinellas, Pasco, Hernando, Citrus, Sumter, Lake, Orange, Seminole, 
Alachua, Putnam, St. Johns, Flagler, Marion, Levy, Duval, Nassau, 
Baker, Union, Bradford, Columbia, Clay, Gilchrist, and Suwannee and 
County Commissioner's Districts One, Two, and Three of Volusia County, 
and that part of the counties of Indian River and Brevard not included 
in Regulation Area II. District Two includes the counties of Polk and 
Osceola. District Three includes the counties of Manatee, Sarasota, 
Hardee, Highlands, Okeechobee, Glades, De Soto, Charlotte, Lee, Hendry, 
Collier, Monroe, Dade, Broward, and that part of the counties of Palm 
Beach and Martin not included in Regulation Area II. District Four 
includes St. Lucie County and that part of the counties of Brevard, 
Indian River, Martin, and Palm Beach described as lying within 
Regulation Area II, and County Commissioner's Districts Four and Five 
of Volusia County.
    Section 905.114 also specifies the grower representation on the 
Committee from each district. Currently, District One is represented by 
one grower member and alternate; District Two is represented by two 
grower members and alternates; Districts Three and Four are represented 
by three grower members and alternates each.
    Since the last redistricting and reapportionment in 1991, total 
citrus acreage has fallen by 24 percent, production has fallen by 23 
percent, and fresh shipments have fallen by 60 percent. Citrus 
production and growing acreage have gradually shifted from the north 
and central parts of the state to the eastern and southwestern growing 
regions following damaging freezes. The industry has also seen an 
overall decrease in acreage and production due to real estate 
development and the impact of several hurricanes. Increased production 
costs associated with replanting, cultivating, and battling citrus 
diseases, such as canker and greening, have also contributed to changes 
in production.
    Considering the numerous changes to the industry, the Committee 
discussed the need to redistrict the production area and reapportion 
grower membership at its meeting on July 14, 2011. During the 
discussion, Committee members agreed that industry conditions have been 
stabilizing, making this an appropriate time to consider redistricting 
and reapportionment. Trees planted to replace acreage lost to disease 
and hurricane damage are now producing, new production practices are 
helping to mitigate the effects of disease, and a weakened housing 
market has reduced development. These factors have all contributed to 
greater stability within the industry.
    In considering redistricting and reapportionment, the Committee 
reviewed the information and recommendations provided by the 
subcommittee tasked with examining this issue. The subcommittee 
reviewed the numbers for acreage, production, and shipments from all 
counties in the production area as required in the order. While this 
information was beneficial in showing how the industry had changed 
since the last time the production area was redistricted, there were 
concerns about how representative these numbers were of the fresh 
citrus industry.
    The majority of Florida citrus production goes to processing for 
juice, and the available numbers for acreage and production by county 
do not delineate between fresh and juice production, making it 
difficult to determine if those numbers reflect fresh production. 
Further, reviewing the available data for fresh shipments also 
presented problems in that the numbers were more reflective of handler 
activity rather than grower activity, as fruit from many counties is 
handled in counties other than where the fruit is grown, and often in 
separate districts from where the fruit is grown.
    In an effort to provide numbers reflective of grower production 
utilized for fresh shipments, the subcommittee used the available 
information on trees by variety in each county combined with the 
percentage of fresh production by variety to calculate a fresh 
production estimate for each county. Currently, 3 percent of orange, 44 
percent of grapefruit, and 58 percent of specialty citrus production 
are shipped to the fresh market. Using these estimates, District One 
currently accounts for 9 percent of fresh production, District Two 13 
percent, District Three 31 percent and District Four 47 percent of 
fresh production.
    Based on the fresh production estimates and other information 
available, the subcommittee recommended reducing the number of 
districts from four to three by combining current Districts One and 
Two, into a new District One. Current District Three would become 
District Two, and District Four would become District Three. The 
subcommittee also recommended that the nine grower members be 
reapportioned, as follows, based on the estimates for fresh production: 
two grower members and alternates for District One, three grower 
members and alternates for District Two, and four grower members and 
alternates for District Three.
    With 9 growers serving on the Committee, each member would 
represent approximately 11 percent of fresh production. Under the 
subcommittee recommendation, District One, with 22 percent of the fresh 
production, would be represented by 22 percent of the grower members 
and alternates on the Committee, with two grower members and 
alternates. District Two, with 31 percent of fresh production, would be 
represented by 33 percent of the grower members and alternates on the 
Committee, with three grower members and alternates. District Three, 
with 47 percent of fresh production, would be represented by 44 percent 
of the grower members and alternates on the Committee, with four grower 
members and alternates.
    In discussing the recommendations of the subcommittee, Committee 
members found that the estimated fresh production numbers were a good 
indicator of fresh production and were beneficial when considering how 
the production area should be redistricted and grower membership 
distributed. Based on the new districts, and the estimated fresh 
production, the Committee agreed that the subcommittee's 
recommendations evenly allocated grower membership. Consequently, the 
Committee voted unanimously in support of the proposed changes.
    Accordingly, District One would include the counties of Alachua, 
Baker, Bradford, Citrus, Clay, Columbia, Duval, Flagler, Gilchrist, 
Hernando, Hillsborough, Lake, Levy, Marion, Nassau, Orange, Osceola, 
Pasco, Pinellas, Polk, Putnam, Seminole, St. Johns, Sumter, Suwannee, 
and Union and County Commissioner's Districts One, Two, and Three of 
Volusia County, and that part of the counties of Indian River and 
Brevard not included in Regulation Area II. District One would be 
represented by two grower members and alternates.
    District Two would include the counties of Broward, Charlotte, 
Collier, Dade, De Soto, Glades, Hardee, Hendry, Highlands, Lee, 
Manatee, Monroe, Okeechobee, Sarasota, and that part of the counties of 
Palm Beach and Martin

[[Page 73963]]

not included in Regulation Area II. District Two would be represented 
by three grower members and alternates.
    District Three would include the County of St. Lucie and that part 
of the counties of Brevard, Indian River, Martin, and Palm Beach 
described as lying within Regulation Area II, and County Commissioner's 
Districts Four and Five of Volusia County. This district would have 
four grower members and alternates.
    In addition to discussing redistricting and reapportionment of 
grower representation on the Committee, the Committee also considered 
changes to the grower membership qualifications established under the 
order. When the qualifications for grower membership were established, 
the line between growers and shippers was clearer, with more growers in 
the business of just producing fresh fruit for the fresh market and not 
involved in the shipping aspect of the industry. However, over the 
years, the industry has seen more growers partnering to form shipping 
interests or vertically integrating with shippers.
    This trend began in the 1990s, when the industry was in an 
oversupply situation, and growers were looking for ways to assure their 
fruit was purchased. This consolidation between growers and shippers 
continued as the industry adjusted to changes in production and reacted 
to the pressures of disease, rising land values, hurricanes and 
freezes. Also, the same pressures that have encouraged consolidation 
and vertical integration have prompted many growers to leave the 
industry, further reducing the number of growers solely engaged in 
production.
    Currently, a grower who is affiliated with or is an employee of a 
shipper does not qualify to serve as a grower member on the Committee. 
In discussing this issue, the Committee recognized the changes in the 
makeup of the industry, and the need to revise the qualifications for 
grower membership to reflect these changes. Committee members agreed 
that with growers who are affiliated with shippers playing an 
increasing role in the industry, a change should be made to facilitate 
their participation on the Committee. Several Committee members stated 
that they thought such a change was important, but that the majority of 
grower seats on the Committee should be maintained for pure growers, 
those not affiliated with a shipper.
    To create an opportunity for shipper-affiliated growers to serve on 
the Committee, while maintaining the majority of positions for pure 
growers, it was proposed that the grower qualifications for membership 
on the Committee be modified so that up to four grower members may be 
growers affiliated with or employed by shippers, with the remaining 
five seats open only to pure growers who are not affiliated with or 
employed by shippers. Committee members supported this proposal because 
it does not mandate that the four positions be filled by growers 
affiliated with shippers, but does create the opportunity for these 
types of growers to serve on the Committee. This proposed change would 
provide the flexibility to expand grower membership to include growers 
who are affiliated with shippers without limiting the opportunity for 
pure growers to serve.
    The Committee believes this change would make the Committee more 
reflective of the fresh segment of the Florida citrus industry. 
Providing the opportunity for growers affiliated with shippers to serve 
on the Committee would help bring additional perspectives and ideas to 
the Committee, would allow another segment of growers to serve on the 
Committee, and may create an increased opportunity for participation by 
small citrus operations. Further, retaining five of the nine grower 
seats as seats for only pure growers would help maintain a balance 
between grower and shipper representation on the Committee.
    With growers who are affiliated with the shipping segment of the 
industry playing an increasing role in the industry and the expectation 
that this segment of growers will continue to increase, the Committee 
believes facilitating their inclusion on the Committee would better 
reflect the current industry structure. Widening the pool of growers 
from which members are nominated would also create additional 
opportunities for growers with different backgrounds and perspectives 
to serve on the Committee. Therefore, the Committee unanimously 
recommended revising grower member qualifications to allow up to four 
growers who are affiliated with or employed by shippers to serve as 
grower members on the Committee.
    The next round of grower nominations should be held in May 2013. In 
order to give the industry ample notice of these proposed changes, and 
because Section 905.14 requires that this announcement occur on or 
before March 1 of the then current fiscal year, the modifications would 
need to be in effect prior to March 1, 2013, to be utilized in the May 
2013 elections.

Initial Regulatory Flexibility Analysis

    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA) (5 U.S.C. 601-612), the Agricultural Marketing Service (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 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.
    There are approximately 55 handlers of Florida citrus who are 
subject to regulation under the marketing order and approximately 8,000 
producers of oranges, grapefruit, tangerines, and tangelos in the 
regulated area. Small agricultural service firms are defined by the 
Small Business Administration (SBA) as those having annual receipts of 
less than $7,000,000, and small agricultural producers are defined as 
those having annual receipts of less than $750,000 (13 CFR 121.201).
    Based on industry and Committee data, the average annual f.o.b. 
price for fresh Florida citrus during the 2010-11 season was 
approximately $12.16 per \4/5\ bushel carton, and total fresh shipments 
were approximately 30.4 million cartons. Using the average f.o.b. price 
and shipment data, and assuming a normal distribution, at least 55 
percent of the Florida citrus handlers could be considered small 
businesses under SBA's definition. In addition, based on production and 
producer prices reported by the National Agricultural Statistics 
Service and the total number of Florida citrus producers, the average 
annual producer revenue is less than $750,000. Therefore, the majority 
of handlers and producers of Florida citrus may be classified as small 
entities.
    This rule would reduce the number of districts from four to three, 
reapportion grower representation among the districts, and allow up to 
four growers who are shippers or employees of shippers to serve as 
grower members on the Committee. These changes would adjust grower 
representation to reflect the composition of the industry, provide 
equitable representation from each district, and create the opportunity 
for more growers to serve on the Committee. This rule would revise 
Sec.  905.114 of the regulations regarding grower districts and the 
allotment of

[[Page 73964]]

members amongst those districts, and would add a new paragraph to Sec.  
905.120 of the rules and regulations to revise grower membership 
qualifications. The authority for these actions is provided in 
Sec. Sec.  905.14 and 905.19 of the order, respectively. These proposed 
changes were unanimously recommended by the Committee at a meeting on 
July 14, 2011.
    It is not anticipated that this action would impose any additional 
costs on the industry. This action would have a beneficial impact as it 
more accurately aligns grower districts and reapportions grower 
membership in accordance with the production of fresh Florida citrus. 
This action would also create an opportunity for growers that are 
affiliated with or employees of shippers to serve on the Committee as 
grower members. These changes should provide equitable representation 
to growers on the Committee and increase diversity by allowing more 
growers the opportunity to serve. These proposed changes are intended 
to make the Committee more representative of the current industry. The 
effects of this rule would not be disproportionately greater or less 
for small entities than for larger entities.
    The Committee discussed alternatives to these changes including 
making no changes to the districts or the apportionment of grower 
membership. The Committee recognized that there had been some 
significant changes to the industry since the last time the production 
area was redistricted and members reapportioned in 1991. The Committee 
determined that some changes were needed to make the districts and the 
apportionment of members reflective of the current industry structure. 
In discussing alternatives to changing grower member qualifications, 
the Committee explored making no changes to the qualifications or 
setting more restrictive limits on the alternate qualifications for 
growers affiliated with shippers. However, the Committee agreed that 
changes to the structure of the industry, including increasing vertical 
integration, would support making a change to grower membership 
qualifications. Further, the Committee believes allowing up to four 
growers affiliated with or employed by shippers to serve on the 
Committee would create an opportunity for these growers, but maintain a 
majority of seats for pure growers who are not affiliated with 
shippers. Therefore, for the reasons above, these alternatives were 
rejected.
    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 the Office of Management and Budget (OMB) and 
assigned OMB No. 0581-0189 Generic Fruit Crops. No changes in those 
requirements as a result of this action would be necessary. Should any 
changes become necessary, they would be submitted to OMB for approval.
    This proposed action would require textual changes to the form FV-
163, Confidential Background Statement. However, the changes would be 
purely cosmetic and would not affect the burden. In light of the 
redistricting, District 4 would be removed as a check-off option. A 
statement on the form would also be reworded to accommodate the 
revision in grower member qualifications. With this change, the OMB 
currently approved total burden for completing FV-163 would remain the 
same. A Justification for Change for these changes would be submitted 
to OMB for approval.
    This proposed rule would not impose any additional reporting or 
recordkeeping requirements on either small or large 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. USDA has not 
identified any relevant Federal rules that duplicate, overlap, or 
conflict with this proposed rule.
    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.
    In addition, the Committee's meeting was widely publicized 
throughout the Florida citrus industry and all interested persons were 
invited to attend the meeting and participate in Committee 
deliberations on all issues. Like all Committee meetings, the July 14, 
2011, 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 informational impacts of this action on small 
businesses.
    A small business guide on complying with fruit, vegetable, and 
specialty crop marketing agreements and orders may be viewed at: 
www.ams.usda.gov/MarketingOrdersSmallBusinessGuide. Any questions about 
the compliance guide should be sent to Laurel May at the previously 
mentioned address in the FOR FURTHER INFORMATION CONTACT section.
    A 30-day comment period is provided to allow interested persons to 
respond to this proposal. Thirty days is deemed appropriate because 
this rule would need to be in place prior to March 1, 2013, for the 
Committee to use these proposed changes in the 2013-14 grower 
nomination cycle. All written comments timely received will be 
considered before a final determination is made on this matter.
    A 30-day comment period is provided to allow interested persons to 
respond to this proposed rule. Thirty days is deemed appropriate 
because Committee nominations are scheduled to be held in the spring. 
These changes would need to be in effect in advance so that industry 
stakeholders are familiar with the new grower districts, 
reapportionment, and qualifications prior to the nomination process. 
Further, to be effective for the next nomination cycle, the order 
requires that the redistricting and reapportionment actions be 
announced on or before March 1, 2013. All written comments timely 
received will be considered before a final determination is made on 
this matter.

List of Subjects in 7 CFR Part 905

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

    For the reasons set forth in the preamble, 7 CFR part 905 is 
proposed to be amended as follows:

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. Section 905.114 is amended by revising paragraphs (a), (b) and 
(c) to read as follows:


Sec.  905.114  Redistricting of citrus districts and reapportionment of 
grower members.

* * * * *
    (a) Citrus District One shall include the counties of Alachua, 
Baker, Bradford, Citrus, Clay, Columbia, Duval, Flagler, Gilchrist, 
Hernando, Hillsborough, Lake, Levy, Marion, Nassau, Orange, Osceola, 
Pasco, Pinellas, Polk, Putnam, Seminole, St. Johns, Sumter, Suwannee, 
and Union and County Commissioner's Districts One, Two, and Three of 
Volusia County, and that part of the counties of Indian River and 
Brevard not included in Regulation Area II. This district shall have 
two grower members and alternates.
    (b) Citrus District Two shall include the counties of Broward, 
Charlotte, Collier, Dade, De Soto, Glades, Hardee,

[[Page 73965]]

Hendry, Highlands, Lee, Manatee, Monroe, Okeechobee, Sarasota, and that 
part of the counties of Palm Beach and Martin not included in 
Regulation Area II. This district shall have three grower members and 
alternates.
    (c) Citrus District Three shall include the County of St. Lucie and 
that part of the counties of Brevard, Indian River, Martin, and Palm 
Beach described as lying within Regulation Area II, and County 
Commissioner's Districts Four and Five of Volusia County. This district 
shall have four grower members and alternates.
    3. A new paragraph (g) is added to Sec.  905.120 to read as 
follows:


Sec.  905.120  Nomination procedure.

* * * * *
    (g) Up to four grower members may be growers who are also shippers, 
or growers who are also employees of shippers.

    Dated: November 28, 2012.
David R. Shipman,
Administrator, Agricultural Marketing Service.
[FR Doc. 2012-29244 Filed 12-11-12; 8:45 am]
BILLING CODE 3410-02-P