[Federal Register Volume 82, Number 180 (Tuesday, September 19, 2017)]
[Proposed Rules]
[Pages 43713-43715]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-19690]


 ========================================================================
 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. 82, No. 180 / Tuesday, September 19, 2017 / 
Proposed Rules  

[[Page 43713]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 959

[Doc. No. AMS-SC-17-0040; SC17-959-1 PR]


Onions Grown in South Texas; Increased Assessment Rate

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule.

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SUMMARY: This proposed rule would implement a recommendation from the 
South Texas Onion Committee (Committee) to increase the assessment rate 
established for the 2017-18 and subsequent fiscal periods from $0.05 to 
$0.065 per 50-pound equivalent of onions handled under the marketing 
order (order). The Committee locally administers the order and is 
comprised of producers and handlers of onions operating within the area 
of production. Assessments upon onion 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 
would remain in effect indefinitely unless modified, suspended, or 
terminated.

DATES: Comments must be received by October 19, 2017.

ADDRESSES: Interested persons are invited to submit written comments 
concerning this proposed rule. Comments must be sent to the Docket 
Clerk, Marketing Order and Agreement Division, Specialty Crops Program, 
AMS, USDA, 1400 Independence Avenue SW., STOP 0237, Washington, DC 
20250-0237; Fax: (202) 720-8938; or internet: http://www.regulations.gov. Comments should reference the document 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, or can be viewed at: http://www.regulations.gov. All comments submitted in response to this 
proposed 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: 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 proposed rule is issued under Marketing 
Order No. 959, as amended (7 CFR part 959), regulating the handling of 
onions grown in South 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 proposed rule 
in conformance with Executive Orders 13563 and 13175. This rule does 
not meet the definition of a significant regulatory action contained in 
section 3(f) of Executive Order 12866 and is not subject to review by 
the Office of Management and Budget (OMB). Additionally, because this 
rule does not meet the definition of a significant regulatory action, 
it does not trigger the requirements contained in Executive Order 
13771. See OMB's Memorandum titled ``Interim Guidance Implementing 
Section 2 of the Executive Order of January 30, 2017, titled `Reducing 
Regulation and Controlling Regulatory Costs' '' (February 2, 2017).
    This proposed rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. Under the marketing order now in effect, South 
Texas onion handlers are subject to assessments. Funds to administer 
the order are derived from such assessments. It is intended that the 
assessment rate as proposed herein would be applicable to all 
assessable onions beginning on August 1, 2017, 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 proposed rule would increase the assessment rate established 
for the Committee for the 2017-18 and subsequent fiscal periods from 
$0.05 to $0.065 per 50-pound equivalent of onions.
    The South Texas onion 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 
South Texas onions. 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

[[Page 43714]]

submitted by the Committee or other information available to USDA.
    The Committee met on June 7, 2017, and unanimously recommended 
2017-18 expenditures of $149,807, the same as budgeted last fiscal 
year, and an assessment rate of $0.065 per 50-pound equivalent of 
onions. The assessment rate of $0.065 is $0.015 higher than the rate 
currently in effect. The Committee recommended the increase so 
assessments would be sufficient to cover the Committee's anticipated 
expenditures while providing additional funds to help replenish the 
Committee's reserve fund, which has been depleted due to declines in 
production. With the Committee's recommended $0.015 increase and 
estimated shipments of approximately three million 50-pound 
equivalents, assessment income should be approximately $195,000.
    The major expenditures recommended by the Committee for the 2017-18 
fiscal year include $50,000 for compliance, $37,050 for administrative, 
and $32,942 for management costs. Budgeted expenses for these items 
were the same in 2016-17.
    The assessment rate recommended by the Committee was derived by 
considering anticipated expenses, expected shipments of South Texas 
onions, and the level of funds in reserve. As mentioned earlier, onion 
shipments for the year are estimated at three million 50-pound 
equivalents, which should provide $195,000 in assessment income. Income 
derived from handler assessments would be adequate to cover budgeted 
expenses. The Committee currently has no money in reserves.
    The proposed assessment rate would 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 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 USDA. 
Committee meetings are open to the public, and interested persons may 
express their views at these meetings. USDA 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. The Committee's 2017-18 budget and those 
for subsequent fiscal periods would be reviewed and, as appropriate, 
approved by USDA.

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 proposed rule 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 
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 60 producers of onions in the production 
area and approximately 30 handlers subject to regulation under the 
marketing order. Small agricultural producers are defined by the Small 
Business Administration 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).
    Based on information from the National Agricultural Statistics 
Service, the weighted grower price for South Texas onions during the 
2015-16 season was around $12.30 per 50-pound equivalent. According to 
Committee data, total shipments were around three million 50-pound 
equivalents. 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. The average handler price 
for South Texas onions during the 2015-16 season was around $14.05 per 
50-pound equivalent. Using the average price and shipment information, 
the number of handlers, and assuming a normal distribution, the 
majority of handlers would have average annual receipts of less than 
$7,500,000. Thus, the majority of South Texas onion producers and 
handlers may be classified as small entities.
    This proposal would increase the assessment rate collected from 
handlers for the 2017-18 and subsequent fiscal periods from $0.05 to 
$0.065 per 50-pound equivalent of Texas onions. The Committee 
unanimously recommended 2017-18 expenditures of $149,807 and an 
assessment rate of $0.065 per 50-pound equivalent. The proposed 
assessment rate of $0.065 is $0.015 higher than the 2016-17 rate. The 
quantity of assessable onions for the 2017-18 fiscal period is 
estimated at three million 50-pound equivalents. Thus, the $0.065 rate 
should provide $195,000 in assessment income and be adequate to meet 
this year's expenses.
    The major expenditures recommended by the Committee for the 2017-18 
year include $50,000 for compliance, $37,050 for administrative, and 
$32,942 for management. Budgeted expenses for these items were the same 
in 2016-17.
    With the 2017-18 crop estimated to be three million 50-pound 
equivalents, the current assessment rate would be sufficient to cover 
the Committee's anticipated expenditures but would not provide any 
additional monies to help replenish the Committee's reserve fund, which 
has been depleted due to declines in production. The Committee 
considered the proposed expenses and the state of the reserve fund and 
recommended the assessment increase. With the Committee's recommended 
$0.015 increase, assessment income should be approximately $195,000 and 
be adequate to cover anticipated expenses and add funds to the 
authorized reserve.
    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. Alternative expenditure levels were 
discussed by these groups, based upon the relative value of various 
activities to the South Texas onion industry. The Committee ultimately 
determined that 2017-18 expenditures of $149,807 were appropriate, and 
the recommended assessment rate would generate sufficient revenue to 
meet its expenses.
    A review of historical information and preliminary information 
pertaining to the upcoming fiscal period indicates that the grower 
price for the 2017-18 season could be around $12.00 per 50-pound 
equivalent of Texas onions. Therefore, the estimated assessment revenue 
for the 2017-18 fiscal period as a percentage of total grower revenue 
could be about 0.5 percent.
    This action would increase 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 
marketing order. In addition, the Committee's meeting was widely 
publicized throughout the South Texas onion industry, and all 
interested

[[Page 43715]]

persons were invited to attend the meeting and participate in Committee 
deliberations on all issues. Like all Committee meetings, the June 7, 
2017, 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.
    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 OMB and assigned OMB No. 0581-0178 (Vegetable 
and Specialty 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 proposed rule would impose no additional reporting or 
recordkeeping requirements on either small or large South Texas 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.
    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.
    USDA has not identified any relevant Federal rules that duplicate, 
overlap, or conflict with this action.
    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.
    A 30-day comment period is provided to allow interested persons to 
respond to this proposed rule. Thirty days is deemed appropriate 
because: (1) The 2017-18 fiscal period begins on August 1, 2017, and 
the marketing order requires that the rate of assessment for each 
fiscal period apply to all assessable onions 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 and is similar to other assessment rate 
actions issued in past years.

List of Subjects in 7 CFR Part 959

    Marketing agreements, Onions, Reporting and recordkeeping 
requirements.

    For the reasons set forth in the preamble, 7 CFR part 959 is 
proposed to be amended as follows:

PART 959--ONIONS GROWN IN SOUTH TEXAS

0
1. The authority citation for 7 CFR part 959 continues to read as 
follows:

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

Subpart A--[Amended]

0
2. Designate the subpart labeled ``Order Regulating Handling'' as 
subpart A.

Subpart B--Administrative Provisions

0
3. Designate the subpart labeled ``Rules and Regulations'' as subpart B 
and revise the heading as shown above.

Subparts ``Assessment Rates'' and ``Handling Regulations''--
[Amended]

0
4. Remove the subpart headings ``Assessment Rates'' and ``Handling 
Regulations''.
0
5. Transfer Sec. Sec.  959.237 and 959.322 to subpart B.
0
6. Section 959.237 is revised to read as follows:


Sec.  959.237   Assessment rate.

    On and after August 1, 2017, an assessment rate of $0.065 per 50-
pound equivalent is established for South Texas onions.

    Dated: September 12, 2017.
Bruce Summers,
Acting Administrator, Agricultural Marketing Service.
[FR Doc. 2017-19690 Filed 9-18-17; 8:45 am]
 BILLING CODE 3410-02-P