[Federal Register Volume 87, Number 201 (Wednesday, October 19, 2022)]
[Proposed Rules]
[Pages 63431-63433]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-22702]


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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. 87, No. 201 / Wednesday, October 19, 2022 / 
Proposed Rules  

[[Page 63431]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 905

[Doc. No. AMS-SC-22-0001]


Florida Citrus Marketing Order; Exemption for Pummelos

AGENCY: Agricultural Marketing Service, Department of Agriculture 
(USDA).

ACTION: Proposed rule.

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SUMMARY: This proposed rule would implement a recommendation from the 
Citrus Administrative Committee (Committee) to exempt pummelos from 
requirements prescribed under the Florida citrus marketing order. The 
proposed change would exempt pummelos from all requirements under the 
marketing order, including registration, assessment, and reporting 
requirements.

DATES: Comments must be received by November 18, 2022.

ADDRESSES: Interested persons are invited to submit written comments 
concerning this proposed rule. Comments can be sent to the Docket 
Clerk, Market Development Division, Specialty Crops Program, AMS, USDA, 
1400 Independence Avenue SW, STOP 0237, Washington, DC 20250-0237. 
Comments can also be submitted to the Docket Clerk electronically by 
Email: [email protected] or via the internet at: https://www.regulations.gov. Comments should reference the document number and 
the date and page number of this issue of the Federal Register. All 
comments submitted in response to this proposed rule will be included 
in the record and 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: Jennie M. Varela, Marketing 
Specialist, or Christian D. Nissen, Branch Chief, Southeast Region 
Branch, Market Development 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, Market Development Division, 
Specialty Crops Program, AMS, USDA, 1400 Independence Avenue SW, STOP 
0237, Washington, DC 20250-0237; Telephone: (202) 720-2491, or Email: 
[email protected].

SUPPLEMENTARY INFORMATION: This action, pursuant to 5 U.S.C. 553, 
proposes an amendment to regulations issued to carry out a marketing 
order as defined in 7 CFR 900.2(j). This proposed rule is issued under 
Marketing Order No. 905, as amended (7 CFR part 905), regulating the 
handling of oranges, grapefruit, tangerines, and pummelos grown in 
Florida. Part 905, (referred to as 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 Committee locally 
administers the Order and is comprised of growers and handlers of fresh 
citrus operating within the production area, and a non-industry member.
    The Agricultural Marketing Service (AMS) is issuing this proposed 
rule in conformance with Executive Orders 12866 and 13563. Executive 
Orders 12866 and 13563 direct agencies to assess all costs and benefits 
of available regulatory alternatives and, if regulation is necessary, 
to select regulatory approaches that maximize net benefits (including 
potential economic, environmental, public health and safety effects, 
distributive impacts, and equity). Executive Order 13563 emphasizes the 
importance of quantifying both costs and benefits, reducing costs, 
harmonizing rules, and promoting flexibility. This action falls within 
a category of regulatory actions that the Office of Management and 
Budget (OMB) exempted from Executive Order 12866 review.
    This proposed rule has been reviewed under Executive Order 13175--
Consultation and Coordination with Indian Tribal Governments, which 
requires agencies to consider whether their rulemaking actions would 
have tribal implications. AMS has determined that this proposed rule is 
unlikely to have substantial direct effects on one or more Indian 
tribes, on the relationship between the Federal Government and Indian 
tribes, or on the distribution of power and responsibilities between 
the Federal Government and Indian tribes.
    This proposed rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. This proposed 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 Department of 
Agriculture (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 no later than 20 
days after the date of the entry of the ruling.
    This proposed rule would exempt pummelos from all requirements 
under the Order, including registration, assessment, and reporting 
requirements. The Committee unanimously recommended this action at its 
November 30, 2021, meeting.
    This proposed action would create the exemption under a new Sec.  
905.130. Section 905.7 provides the authority to require handlers to be 
registered with the Committee pursuant to rules recommended by the 
Committee and approved by the Secretary of Agriculture (Secretary). 
Section 905.41 authorizes the Committee to collect assessments, such 
that each handler shall pay the Committee a pro rata share of the 
expenses.
    Sections 905.70 and 905.71 provide the authority for the Committee 
to collect reports from handlers including, information regarding the 
variety, grade, and size of each standard packed carton of fruit 
shipped, and any other information deemed necessary to administer the 
Order, with the approval of the Secretary. Section 905.80 of the Order 
allows the Committee to specify

[[Page 63432]]

additional types of shipments or purposes that would not be subject to 
regulation or payment of assessments, with the approval of the 
Secretary.
    The regulations associated with these authorities include Sec.  
905.107 which outlines the registered handler requirements, Sec.  
905.171, which requires handlers to report the list of growers for whom 
they handled, and Sec.  905.235, which requires handlers pay 
assessments of $0.015 per 4/5-bushel carton to the Committee.
    The Florida citrus industry voted to incorporate pummelos into the 
Order when it was amended in 2016, as pummelos were being used to 
develop new citrus hybrids. However, there are not yet any pummelo 
hybrid varieties produced in commercial volume. The current market for 
pummelos is small, estimated at 100,000 boxes, or 200,000 cartons. In 
comparison, the entire Florida citrus industry shipped over 6 million 
cartons during the 2020-21 season.
    The Order regulates shipments of fresh citrus leaving the State of 
Florida for grade and size. Intrastate shipments are covered by 
parallel State regulations. The Florida Department of Agriculture and 
Consumer Services inspects fresh citrus at packinghouses and provides 
shipment data to the Committee. The Committee then uses this data to 
bill for assessments and to issue industry reports. There are currently 
no quality requirements in effect for pummelos or pummelo hybrids under 
the Order, nor are there any State requirements. As a result, there is 
no inspection and therefore no established method of data collection 
for pummelos.
    Since the Order was amended, Committee staff have been in contact 
with pummelo growers and handlers, working on a way to collect required 
information and assessments. Under the current Order requirements and 
industry practices, there is no uniform way to meet the requirements 
without creating a specific reporting requirement for pummelos. In 
addition, pummelo growers and shippers have communicated to the 
Committee that they would like to be excluded from Order requirements.
    During the November 30, 2021, Committee meeting, members discussed 
the issues related to pummelo shipments, including whether to develop a 
new system for collecting information and assessments on pummelo fruit. 
The Committee reports that there are only six pummelo producers and 
three shippers, most of whom are small grower-shippers not handling any 
other citrus covered under the Order.
    Committee members indicated that with the volume for pummelo and 
pummelo hybrids remaining stagnant, there is currently no desire to 
establish grade and size requirements on pummelo at the State or 
Federal level. Therefore, there would be no data from inspection. 
Consequently, if pummelo and pummelo hybrids remain subject to Order 
requirements for reporting and assessments, it would be necessary for 
the Committee to establish separate reporting procedures and 
documentation for pummelo movement.
    The Committee expressed uncertainty that creating requirements 
specifically for pummelo would add value to the industry. Even if the 
shipment data were collected, because of confidentiality concerns, the 
Committee may not be able to report out the results due to the small 
number of handlers. Further, at the estimated volume shipped, 
additional assessments would total $3,000. This amount may not be 
sufficient to cover the cost of developing the necessary reports and 
ensuring compliance.
    The Committee has previously recommended, and AMS approved, 
exemptions for gift packages, minimum shipments, and animal feed. These 
are shipping channels or volumes that would not affect overall demand 
for fresh fruit. Similarly, the Committee believes demand would not be 
harmed if pummelo shipments continued without being subject to the 
requirements of the Order.
    This proposed change would exempt pummelos from all requirements 
under the marketing order, including registration, assessment, and 
reporting requirements. This exemption would be codified in a new Sec.  
905.130. If a handler ships pummelo as well as other regulated citrus, 
the handler will still have to meet all requirements related to the 
other citrus covered by the Order. Further, the Committee could 
consider removing this exemption if conditions change over time. Thus, 
the Committee unanimously recommended exempting pummelo fruit from all 
Order requirements. After consideration of all relevant material 
presented, including the information and recommendations submitted by 
the Committee and other available information, AMS has determined that 
this proposed rule is consistent with and will effectuate the purposes 
of the Act.

Initial Regulatory Flexibility Analysis

    Pursuant to requirements set forth in the Regulatory Flexibility 
Act (RFA) (5 U.S.C. 601-612), 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 
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 500 producers of Florida citrus in the 
production area and about 15 handlers subject to regulation under the 
Order. The Committee reports there are six pummelo producers and three 
shippers. Small agricultural producers of orange groves are defined by 
the Small Business Administration (SBA) (13 CFR 121.201) as those 
having annual receipts of $3,500,000 or less, and small agricultural 
service firms are defined as those whose annual receipts are 
$30,000,000 or less (13 CFR 121.201).
    According to data from the National Agricultural Statistics Service 
(NASS) and the Committee, the weighted average packing house door 
equivalent price for fresh Florida citrus for the 2020-21 season was 
approximately $6.52 per carton with total shipments of 6,022,426 
cartons. Using the number of handlers, the majority of handlers have 
average annual receipts of less than $30,000,000 ($6.52 times 6,022,426 
cartons equals $39,266,217.52 divided by 15 handlers equals 
$2,617,747.83 per handler).
    In addition, based on the NASS data, the weighted average grower 
price for the 2020-21 season was estimated at $4.95 per carton of fresh 
citrus. Based on grower price, shipment data, and the total number of 
Florida citrus growers, the average annual grower revenue is below 
$3,500,000 ($4.95 times 6,022,426 million cartons equal $29,811,008.70 
divided by 500 growers equals $59,622.02 per grower). Thus, the 
majority of Florida citrus handlers and growers may be classified as 
small entities.
    This proposed rule would exempt pummelos from all requirements 
under the marketing order, including assessment and reporting 
requirements. Without this exemption, it would be necessary for the 
Committee to establish separate reporting procedures for pummelos. This 
proposed rule would create Sec.  905.130 to establish the pummelo 
exemption. Authority for this change is provided in Sec. Sec.  905.7, 
905.41, 905.70, 905.71, and 905.80.
    This action is not expected to increase the costs associated with 
the Order's

[[Page 63433]]

requirements. Rather, it is anticipated this action would have a 
beneficial impact by exempting pummelo handlers, primarily small 
entities, from regulation, assessment, and reporting requirements.
    Exemption from assessments would create a minimal loss of revenue. 
Using the current assessment rate and pummelo shipments estimated by 
Committee members (200,000 cartons), there would be about $3,000 lost 
per year. Developing an alternative reporting process and maintaining 
compliance would likely cost the Committee more than that amount in 
staff time. Pummelo growers and handlers should benefit from this 
change regardless of their size.
    The Committee discussed an alternative to this action. It 
considered whether there was a need to establish grade and size 
requirements for pummelo and track the shipments as they do for other 
citrus fruits. Committee members indicated the pummelo market is not 
experiencing quality concerns, and there is no industry interest in 
creating such requirements. Therefore, the Committee rejected this 
alternative.
    Committee meetings were widely publicized throughout the citrus 
industry. All interested persons were invited to attend Committee 
meetings and participate in Committee deliberations on all issues. Like 
all Committee meetings, the November 30, 2021, meeting was a public 
meeting and all entities, both large and small, were able to express 
views on this issue. Interested persons are invited to submit comments 
on this proposed rule, including the regulatory and informational 
collection 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 the OMB and assigned OMB No. 0581-0189, Fruit 
Crops. No changes in those requirements would be necessary as a result 
of this proposed rule. Should any changes become necessary, they 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. AMS 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.
    A small business guide on complying with fruit, vegetable, and 
specialty crop marketing agreements and orders may be viewed at: 
https://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. 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, Marketing agreements, Oranges, Pummelos, Reporting and 
recordkeeping requirements, Tangelos, Tangerines.

    For the reasons set forth in the preamble, the Agricultural 
Marketing Service proposes to amend 7 CFR part 905 as follows:

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

0
1. The authority citation for part 905 continues to read as follows:

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

0
2. Add Sec.  905.130 to read as follows:


Sec.  905.130  Exemptions for Pummelo.

    The handling of pummelo fruit or pummelo hybrids shall be exempt 
from the provisions of Sec. Sec.  905.7, 905.41, 905.70, 905.71 and the 
regulations issued thereunder: Provided, That, if the handler ships 
other fruit subject to Order requirements, the handler must comply with 
all sections of the Order applicable to such fruit, including handler 
registration.

Erin Morris,
Associate Administrator, Agricultural Marketing Service.
[FR Doc. 2022-22702 Filed 10-18-22; 8:45 am]
BILLING CODE P