[Federal Register Volume 81, Number 206 (Tuesday, October 25, 2016)]
[Rules and Regulations]
[Pages 73333-73335]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-25681]



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  Federal Register / Vol. 81, No. 206 / Tuesday, October 25, 2016 / 
Rules and Regulations  

[[Page 73333]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 906

[Doc. No. AMS-SC-16-0059; SC16-906-2 FR]


Oranges and Grapefruit Grown in Lower Rio Grande Valley in Texas; 
Increased Assessment Rate

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

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SUMMARY: This rule implements a recommendation from the Texas Valley 
Citrus Committee (Committee) for an increase of the assessment rate 
established for the 2016-17 and subsequent fiscal periods from $0.08 to 
$0.09 per 7/10-bushel carton or equivalent of oranges and grapefruit 
handled under the marketing order (order). The Committee locally 
administers the order, and is comprised of producers and handlers of 
oranges and grapefruit operating within the area of production. 
Assessments upon orange and grapefruit handlers are used by the 
Committee to fund reasonable and necessary expenses of the program. The 
fiscal period begins August 1 and ends July 31. The assessment rate 
will remain in effect indefinitely unless modified, suspended, or 
terminated.

DATES: Effective October 26, 2016.

FOR FURTHER INFORMATION CONTACT: Doris Jamieson, Marketing Specialist, 
or Christian D. Nissen, Regional Director, Southeast Marketing Field 
Office, Marketing Order and Agreement Division, Specialty Crops 
Program, AMS, USDA; Telephone: (863) 324-3375, Fax: (863) 291-8614, or 
Email: [email protected] or [email protected].
    Small businesses may request information on complying with this 
regulation by contacting Richard Lower, Marketing Order and Agreement 
Division, Specialty Crops 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 rule is issued under Marketing 
Agreement and Order No. 906, as amended (7 CFR part 906), 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 (USDA) is issuing this rule in 
conformance with Executive Orders 12866, 13563, and 13175.
    This rule has been reviewed under Executive Order 12988, Civil 
Justice Reform. Under the marketing order now in effect, Texas orange 
and grapefruit handlers are subject to assessments. Funds to administer 
the order are derived from such assessments. It is intended that the 
assessment rate as issued herein will be applicable to all assessable 
oranges and grapefruit beginning on August 1, 2016, and continue until 
amended, suspended, or terminated.
    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. Such 
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 rule increases the assessment rate established for the 
Committee for the 2016-17 and subsequent fiscal periods from $0.08 to 
$0.09 per 7/10-bushel carton or equivalent of oranges and grapefruit 
handled.
    The Texas orange and grapefruit marketing order provides authority 
for the Committee, with the approval of USDA, to formulate an annual 
budget of expenses and collect assessments from handlers to administer 
the program. The members of the Committee are producers and handlers of 
Texas oranges and grapefruit. They are 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 assessment rate is formulated and discussed in a 
public meeting. Thus, all directly affected persons have an opportunity 
to participate and provide input.
    For the 2015-16 and subsequent fiscal periods, the Committee 
recommended, and USDA approved, an assessment rate that would continue 
in effect from fiscal period to fiscal period unless modified, 
suspended, or terminated by USDA upon recommendation and information 
submitted by the Committee or other information available to USDA.
    The Committee met on June 2, 2016, and unanimously recommended 
2016-17 expenditures of $751,148 and an assessment rate of $0.09 per 7/
10-bushel carton or equivalent of oranges and grapefruit. In 
comparison, last year's budgeted expenditures were $701,148. The 
assessment rate of $0.09 is $0.01 higher than the rate currently in 
effect. At the current assessment rate, assessment income would equal 
around $640,000, an amount insufficient to cover the Committee's 
anticipated expenditures, which includes a $50,000 increase in funding 
for compliance. The Committee considered the estimated expenses and 
recommended increasing the assessment rate.
    The major expenditures recommended by the Committee for the 2016-17 
year include $600,248 for the Mexican fruit fly control program, 
$77,200 for management, and $50,000 for compliance. Budgeted expenses 
for these items in 2015-16 were $600,248, $77,200, and $0, 
respectively.
    The assessment rate recommended by the Committee was derived by 
dividing anticipated expenses by expected shipments of Texas oranges 
and grapefruit. Orange and grapefruit shipments for the 2016-17 year 
are

[[Page 73334]]

estimated at 8 million 7/10-bushel cartons or equivalent, which should 
provide $720,000 in assessment income. Income derived from handler 
assessments, along with interest income and funds from the Committee's 
authorized reserve, should be adequate to cover budgeted expenses. 
Funds in the reserve (currently around $367,000) will be kept within 
the maximum permitted by the order (approximately one fiscal period's 
expenses as stated in Sec.  906.35).
    The assessment rate established in this rule will continue in 
effect indefinitely unless modified, suspended, or terminated by USDA 
upon recommendation and information submitted by the Committee or other 
available information.
    Although this assessment rate will be in effect for an indefinite 
period, the Committee will 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 USDA. 
Committee meetings are open to the public and interested persons may 
express their views at these meetings. USDA will evaluate Committee 
recommendations and other available information to determine whether 
modification of the assessment rate is needed. Further rulemaking will 
be undertaken as necessary. The Committee's 2016-17 budget and those 
for subsequent fiscal periods would be reviewed and, as appropriate, 
approved by USDA.

Final 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 rule on small entities. 
Accordingly, AMS has prepared this final regulatory flexibility 
analysis.
    The purpose of the RFA is to fit regulatory actions to the scale of 
businesses 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.
    There are approximately 170 producers of oranges and grapefruit in 
the production area and 13 handlers subject to regulation under the 
marketing order. Small agricultural producers are defined by the Small 
Business Administration (SBA) as those having annual receipts less than 
$750,000, and small agricultural service firms are defined as those 
whose annual receipts are less than $7,500,000 (13 CFR 121.201).
    According to Committee data, the average price for Texas citrus 
during the 2014-15 season was around $16.50 per box and total shipments 
were near 4.1 million boxes. Using the average price and shipment 
information, the number of handlers, and assuming a normal 
distribution, the majority of handlers have average annual receipts of 
less than $7,500,000. In addition, based on information from the 
National Agricultural Statistics Service, the weighted grower price for 
Texas citrus during the 2014-15 season was around $9.55 per box. Using 
the weighted average price and shipment information, and assuming a 
normal distribution, the majority of producers would have annual 
receipts of less than $750,000. Thus, the majority of Texas citrus 
handlers and producers may be classified as small entities.
    This rule increases the assessment rate established for the 
Committee and collected from handlers for the 2016-17 and subsequent 
fiscal periods from $0.08 to $0.09 per 7/10-bushel carton or equivalent 
of Texas oranges and grapefruit. The Committee unanimously recommended 
2016-17 expenditures of $751,148 and an assessment rate of $0.09 per 7/
10-bushel carton or equivalent. The assessment rate of $0.09 is $0.01 
higher than the 2015-16 rate. The quantity of assessable oranges and 
grapefruit for the 2016-17 season is estimated at 8 million 7/10-bushel 
cartons or equivalent. Thus, the $0.09 rate should provide $720,000 in 
assessment income. Income derived from handler assessments, along with 
interest income and funds from the Committee's authorized reserve, 
should be adequate to meet this year's expenses.
    The major expenditures recommended by the Committee for the 2016-17 
year include $600,248 for the Mexican fruit fly control program, 
$77,200 for management, and $50,000 for compliance. Budgeted expenses 
for these items in 2015-16 were $600,248, $77,200, and $0, 
respectively.
    At the current assessment rate, assessment income would only equal 
around $640,000, an amount insufficient to cover the Committee's 
anticipated expenditures, which includes a $50,000 increase in funding 
for compliance. The Committee considered the estimated expenses and 
recommended increasing the assessment rate.
    Prior to arriving at this budget and assessment rate, the Committee 
considered information from various sources, such as the Committee's 
Budget and Personnel Committee, and Committee management. Alternative 
expenditure levels were discussed by these groups, based upon the 
relative value of various activities to the Texas citrus industry. 
Based on estimated shipments, the recommended assessment rate of $0.09 
should provide $720,000 in assessment income. The Committee determined 
that the assessment revenue, along with funds from interest income and 
funds from reserves, would be adequate to cover budgeted expenses for 
the 2016-17 fiscal period.
    A review of historical information and preliminary information 
pertaining to the upcoming crop year indicates that the average grower 
price for the 2016-17 season could be around $13.50 per 7/10-bushel 
carton or equivalent of oranges and grapefruit. Therefore, the 
estimated assessment revenue for the 2016-17 crop year as a percentage 
of total grower revenue could be around 0.6 percent.
    This action increases 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 
are offset by the benefits derived by the operation of the marketing 
order.
    The Committee's meeting was widely publicized throughout the Texas 
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 June 2, 2016, meeting was a public meeting 
and all entities, both large and small, were able to express views on 
this issue.
    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 are necessary. Should any 
changes become necessary, they would be submitted to OMB for approval.
    This rule imposes no additional reporting or recordkeeping 
requirements on either small or large Texas orange and grapefruit 
handlers. As with all Federal marketing order programs, reports and 
forms are periodically reviewed to reduce information requirements and 
duplication by

[[Page 73335]]

industry and public sector agencies. As noted in the initial regulatory 
flexibility analysis, USDA has not identified any relevant Federal 
rules that duplicate, overlap, or conflict with this final 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.
    A proposed rule concerning this action was published in the Federal 
Register on August 17, 2016 (81 FR 54748). Copies of the proposed rule 
were also mailed or sent via facsimile to all Texas orange and 
grapefruit handlers. Finally, the proposal was made available through 
the internet by USDA and the Office of the Federal Register. A 30-day 
comment period ending September 16, 2016, was provided for interested 
persons to respond to the proposal. No comments were received.
    A small business guide on complying with fruit, vegetable, and 
specialty crop marketing agreements and orders may be viewed at: http://www.ams.usda.gov/rules-regulations/moa/small-businesses. Any questions 
about the compliance guide should be sent to Richard Lower at the 
previously-mentioned address in the FOR FURTHER INFORMATION CONTACT 
section.
    After consideration of all relevant material presented, including 
the information and recommendation 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.
    Pursuant to 5 U.S.C. 553, it also found and determined that good 
cause exists for not postposing the effective date of this rule until 
30 days after publication in the Federal Register because: (1) The 
2016-17 fiscal period began on August 1, 2016, and the marketing order 
requires that the rate of assessment for each fiscal period apply to 
all assessable Texas oranges and grapefruit handled during such fiscal 
period; (2) the Committee needs to have sufficient funds to pay its 
expenses which are incurred on a continuous basis; and (3) handlers are 
aware of this action which was unanimously recommended by the Committee 
at a public meeting. Also, a 30-day comment period was provided for in 
the proposed rule.

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 LOWER RIO GRANDE VALLEY 
IN TEXAS

0
1. The authority citation for 7 CFR part 906 continues to read as 
follows:

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

0
2. Section 906.235 is revised to read as follows:


Sec.  906.235  Assessment rate.

    On and after August 1, 2016, an assessment rate of $0.09 per 7/10-
bushel carton or equivalent is established for oranges and grapefruit 
grown in the Lower Rio Grande Valley in Texas.

    Dated: October 19, 2016.
Elanor Starmer,
Administrator, Agricultural Marketing Service.
[FR Doc. 2016-25681 Filed 10-24-16; 8:45 am]
BILLING CODE 3410-02-P