[Federal Register Volume 89, Number 140 (Monday, July 22, 2024)]
[Rules and Regulations]
[Pages 58955-58958]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-15975]
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Rules and Regulations
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains regulatory documents
having general applicability and legal effect, most of which are keyed
to and codified in the Code of Federal Regulations, which is published
under 50 titles pursuant to 44 U.S.C. 1510.
The Code of Federal Regulations is sold by the Superintendent of Documents.
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Federal Register / Vol. 89, No. 140 / Monday, July 22, 2024 / Rules
and Regulations
[[Page 58955]]
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 905
[Doc. No. AMS-SC-23-0041]
Oranges, Grapefruit, Tangerines, and Pummelos Grown in Florida;
Increased Assessment Rate
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Final rule.
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SUMMARY: This rule implements a recommendation from the Citrus
Administrative Committee (Committee) to increase the assessment rate
established for the 2023-2024 and subsequent fiscal periods from $0.015
to $0.02 per \4/5\-bushel carton or equivalent for Florida citrus
handled under the marketing order. The assessment rate will remain in
effect indefinitely unless modified, suspended, or terminated.
DATES: Effective August 21, 2024.
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, 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) 720-8085, or Email:
[email protected].
SUPPLEMENTARY INFORMATION: This action, pursuant to 5 U.S.C. 553,
amends regulations issued to carry out a marketing order as defined in
7 CFR 900.2(j). This 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 area of production, and one public member.
The Agricultural Marketing Service (AMS) is issuing this rule in
conformance with Executive Orders 12866, 13563, and 14094. 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. Executive Order 14094
reaffirms, supplements, and updates Executive Order 12866 and further
directs agencies to solicit and consider input from a wide range of
affected and interested parties through a variety of means. This action
falls within a category of regulatory actions that the Office of
Management and Budget (OMB) exempted from Executive Order 12866 review.
This 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 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 rule has been reviewed under Executive Order 12988--Civil
Justice Reform. Under the Order now in effect, Florida citrus handlers
are subject to assessments. Funds to administer the Order are derived
from such assessments. It is intended that the assessment rate will be
applicable to all assessable fruit for the 2023-2024 fiscal period, 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 8c(15)(A) of the
Act (7 U.S.C. 608c(15)(A)), any handler subject to an order may file
with the U.S. 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 rule increases the assessment rate for Florida citrus handled
under the Order from $0.015 per \4/5\-bushel carton or equivalent, the
rate that was initially established for the 2018-2019 and subsequent
fiscal periods, to $0.02 per \4/5\-bushel carton or equivalent for the
2023-2024 and subsequent fiscal periods.
Sections 905.40 and 905.41 authorize the Committee, with the
approval of AMS, to formulate an annual budget of expenses and collect
assessments from handlers to administer the program. The members are
familiar with the Committee's needs and with the costs of goods and
services in their local area and are able to formulate an appropriate
budget and assessment rate. The assessment rate is formulated and
discussed in a public meeting, and all directly affected persons have
an opportunity to participate and provide input.
For the 2018-2019 and subsequent fiscal periods, the Committee
recommended, and AMS approved, an assessment rate of $0.015 per \4/5\-
bushel carton or equivalent of citrus. That rate continues in effect
from fiscal period to fiscal period until modified, suspended, or
terminated by AMS upon recommendation and information submitted by the
Committee or other information available to AMS. This rule increases
the assessment rate from $0.015 to $0.02 per \4/5\-bushel carton or
[[Page 58956]]
equivalent of citrus for the 2023-2024 and subsequent fiscal periods.
The Committee met on August 8, 2023, and recommended 2023-2024
fiscal period expenditures of $124,624 and an assessment rate of $0.02
per \4/5\-bushel carton or equivalent of citrus handled for the 2023-
2024 and subsequent fiscal periods. In comparison, last period's
budgeted expenditures were $122,680. The increased assessment rate of
$0.02 is $0.005 higher than the rate currently in effect. The Committee
recommended increasing the assessment rate to better align assessment
revenue with budgeted expenses. The Committee projects handler receipts
of approximately 6,700,000 \4/5\-bushel cartons or equivalent of citrus
for the 2023-2024 fiscal period, which is higher than the 4,764,544
cartons handled in the 2022-2023 fiscal period.
The total expenditures recommended by the Committee for the 2023-
2024 fiscal period are approximately $124,624. The major budgeted
expenditures include $99,624 for management; $10,000 for auditing; and
$5,000 for data from the Division of Fruits and Vegetables. By
comparison, budgeted expenditures for these activities in the 2022-2023
fiscal period were $97,680; $10,000; and $5,000, respectively.
At the current assessment rate of $0.015, the expected 6,700,000
\4/5\-bushel cartons or equivalent of assessable Florida citrus would
generate $100,500 in assessment revenue (6,700,000 cartons multiplied
by $0.015 assessment rate), short of the Committee's anticipated
expenditures of $124,624 for the 2023-2024 fiscal period. By increasing
the assessment rate by $0.005 to $0.02, assessment income will generate
$134,000 (6,700,000 cartons multiplied by $0.02 assessment rate) for
the 2023-2024 fiscal period. This amount should be appropriate to
ensure that the Committee has sufficient revenue to fully fund its
recommended 2023-2024 fiscal period budgeted expenditures.
The Committee derived the recommended assessment rate by
considering anticipated expenses, an estimated 6,700,000 \4/5\-bushel
cartons or equivalent of assessable Florida citrus, and the amount of
funds available in reserve. Income derived from handler assessments
($134,000) will be adequate to cover budgeted expenses ($124,624).
Funds available in the reserve (currently about $165,000) are expected
to be kept within the maximum permitted by the Order (approximately two
fiscal periods' expenses as authorized in Sec. 905.42).
The assessment rate will continue in effect indefinitely unless
modified, suspended, or terminated by AMS 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 AMS.
Committee meetings are open to the public and interested persons may
express their views at these meetings. AMS will 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 2023-2024 budget, and those
for subsequent fiscal periods, will be reviewed and, as appropriate,
approved by AMS.
Final 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 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 14 handlers of Florida citrus who are subject to
regulation under the Order and approximately 500 citrus producers in
the regulated area. At the time this analysis was prepared, the Small
Business Administration (SBA) defined small agricultural growers as
those having annual receipts of no more than $4,000,000 for orange
producers (NAICS code 111310, Orange Groves) or $4,250,000 for other
citrus producers (NAICS code 111320, Citrus (except Orange) Groves),
and small agricultural service firms, including handlers, are defined
as those whose annual receipts are less than $34,000,000 (NAICS code
115114, Postharvest Crop Activities) (13 CFR 121.201).
According to data from the National Agricultural Statistics Service
(NASS), the weighted average packing house door equivalent price for
fresh Florida oranges for the 2022-2023 season was approximately $10.54
per carton with total shipments of around 3,224,000 cartons. Based on
this information, the majority of orange handlers have average annual
receipts of significantly less than $34,000,000 ($10.54 multiplied by
3,224,000 cartons equals $33,980,960, divided by 14 handlers equals
$2,427,211 per handler). The weighted average packing house door price
for other Florida citrus for the 2022-2023 season was $19.12 per carton
with total shipments of 2,804,000 cartons. Based on this information,
the majority of other citrus handlers have average annual receipts of
significantly less than $34,000,000 ($19.12 multiplied by 2,804,000
cartons equals $53,612,480, divided by 14 handlers equals $3,829,463
per handler).
In addition, based on the NASS data, the weighted average orange
grower price for the 2022-2023 season was estimated at $9.45 per carton
of fresh oranges. Based on grower price, shipment data, and the total
number of Florida orange growers, the average annual grower revenue is
well below $4,000,000 ($9.45 multiplied by 3,224,000 cartons equals
$30,466,800, divided by 500 growers equals $60,934 per grower). The
weighted average other citrus grower price for the 2022-2023 season was
estimated at $16.28 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 well below $4,250,000 ($16.28
multiplied by 2,804,000 cartons equals $45,649,120, divided by 500
growers equals $91,298 per grower). Thus, the majority of Florida
citrus handlers and growers may be classified as small entities.
This rule increases the assessment rate for the 2023-2024 and
subsequent fiscal periods from $0.015 to $0.02 per \4/5\-bushel carton
or equivalent of citrus. The Committee recommended 2023-2024
expenditures of $124,624 and an assessment rate of $0.02 per \4/5\-
bushel carton. The increased assessment rate of $0.02 is $0.005 more
than the previous rate. The quantity of assessable Florida citrus for
the 2023-2024 season is estimated at 6,700,000 \4/5\-bushel cartons or
equivalent. Thus, the $0.02 rate should provide $134,000 in assessment
income (6,700,000 cartons multiplied by $0.02 assessment rate). Income
derived from handler assessments should be adequate to cover budgeted
expenses.
The major expenditures recommended by the Committee for the 2023-
2024 fiscal period include $99,624 for management; $10,000 for
auditing; and $5,000 for data from the Division of
[[Page 58957]]
Fruits and Vegetables. Budgeted expenses for these same items in the
2022-2023 fiscal period were $97,680; $10,000; and $5,000,
respectively.
The Committee recommended increasing the assessment rate to cover
anticipated expenses for the 2023-2024 fiscal period. Shipments for the
2023-2024 season are projected to be 6,700,000 \4/5\-bushel cartons or
equivalent, about 2 million more than estimated for the previous
period. At the current assessment rate of $0.015, assessment income
would equal $100,500 (6,700,000 cartons multiplied by $0.015 assessment
rate), an amount below the Committee's anticipated expenditures of
$124,624 for the 2023-2024 fiscal period. By increasing the assessment
rate by $0.005, assessment income will be approximately $134,000
(6,700,000 cartons multiplied by $0.02 assessment rate). This amount
should provide sufficient funds to meet anticipated expenses for the
2023-2024 fiscal period.
Prior to arriving at this budget and assessment rate, the Committee
considered maintaining the current assessment rate of $0.015. However,
the Committee would need to further draw down reserves to meet its
expenses. The Committee had to use some of its reserves in the 2022-
2023 fiscal period after a hurricane damaged the crop, and Committee
members did not want to utilize additional funds from reserves to meet
2023-2024 expenses. Consequently, the alternative of maintaining the
current assessment rate was rejected.
A review of historical information and preliminary information
pertaining to the upcoming fiscal period indicates the average grower
price for the 2023-2024 season should be approximately $11.00 per \4/
5\-bushel carton or equivalent of citrus. Therefore, the estimated
assessment revenue for the 2023-2024 crop year as a percentage of total
grower revenue should be about 0.18 percent ($0.02 divided by $11.00
multiplied by 100).
This action increases the assessment obligation imposed on
handlers. Assessments are applied uniformly on all handlers, and some
of the costs may be passed on to producers. However, these costs are
expected to be offset by the benefits derived by the operations of the
Order.
The Committee's meetings are widely publicized throughout the
Florida citrus industry and all interested persons are invited to
attend the meeting and participate in Committee deliberations on all
issues. Like all Committee meetings, the August 8, 2023, meeting was a
public meeting and all entities, both large and small, were able to
express views on this issue. Finally, interested persons were invited
to submit comments on the proposed rulemaking, including the regulatory
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. 0581-0189 Fruit Crops.
No changes in those requirements will be necessary as a result of this
rule. Should any changes become necessary, they would be submitted to
OMB for approval.
This rule will not impose any additional reporting or recordkeeping
requirements on either small or large Florida 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 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.
AMS has not identified any relevant Federal rules that duplicate,
overlap, or conflict with this rule.
A proposed rulemaking concerning this action was published in the
Federal Register on February 1, 2024 (89 FR 6440). Copies of the
proposed rulemaking were also mailed or sent via email to all Florida
citrus handlers. The proposal was also made available through the
internet by AMS and the Office of the Federal Register. A 30-day
comment period ending March 4, 2024, was provided for interested
persons to respond to the proposal.
AMS received a total of nine comments during the comment period.
Five comments supported the revised assessment rate, two comments
opposed the rate, one did not take a position on the proposal, and one
did not address the merits of the rule.
Several comments in support of the increased rate included
statements that the rate change could be beneficial in accounting for
the effects of citrus greening and hurricane damage. Another commenter
stated the industry's current situation calls for the decision to use
additional funds. One commenter noted that the proposal seemed
reasonable as the budgeted expenses are higher than the Committee's
revenue.
The two comments opposed to the rule both focused on the potential
increase to the price of citrus. One expressed concern that this change
would have a negative impact on the larger economies for citrus and
citrus products, namely juice, candy, and raw fruit. This commenter
also mentioned potential negative impacts on Native American producers.
In previous seasons, the Committee has used reserves to cover some
of the shortfalls in administering the program. In their discussion of
the budget for the 2023-2024 season, the Committee determined it was in
their best interest to make a minor increase to the rate rather than
draw down on financial reserves further. The Committee also made this
decision as they determined the benefits of the Order outweigh the
small increase in the assessment rate.
In addition, this action only applies to the handling of fresh
Florida citrus. According to NASS, the fresh segment makes up only
about 16 percent of Florida's citrus production. The price of fresh
citrus is usually higher than that of fruit being sent to processing.
This action, therefore, only applies to a smaller, higher value segment
of the industry and should not impact the price of juice or any other
processed citrus product.
Regarding the overall concern about the increase in the price of
citrus, the Committee made its recommendation with the awareness that
the additional cost to handlers may be passed on to growers and
consumers. However, this rule only increases the assessment rate by
$0.005 per a \4/5\-bushel carton, accounting for an estimated $33,500
increase in assessments for the entire fresh industry. Further, as
noted in the final regulatory flexibility analysis, the total
assessment rate is equivalent to about 0.18 of a percent of the grower
price, and if compared to the anticipated price received by handlers,
the percentage would be even smaller. Given these numbers, this change
is not expected to result in a significant increase in cost for
growers, handlers, or consumers.
One of the commenters in opposition to the rule also suggested
there may be an impact on the Seminole Tribe of Florida as they have
historically owned citrus groves. The comment stated increasing
regulations and adding costs like assessments are potentially limiting
factors to Native participation in the industry. AMS spoke with the
Committee directly, which had recently contacted the Tribe as a part of
its routine outreach. The Tribe confirmed they are completely out of
the citrus business and that they did not have
[[Page 58958]]
concerns with this rulemaking or its potential to limit participation
in the industry. AMS therefore determined the assessment rate change
will not have an impact on Tribes in the production area. Accordingly,
AMS made no changes to the rule based on the comments received.
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.
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 rule is
consistent with and will effectuate the purposes of the Act.
List of Subjects in 7 CFR Part 905
Grapefruit, Marketing agreements, Oranges, Pummelos, Reporting and
recordkeeping requirements, Tangerines.
For the reasons set forth in the preamble, the Agricultural
Marketing Service amends 7 CFR part 905 as follows:
PART 905--ORANGES, GRAPEFRUIT, TANGERINES, AND PUMMELOS GROWN IN
FLORIDA
0
1. The authority citation for 7 CFR part 905 continues to read as
follows:
Authority: 7 U.S.C. 601-674.
0
2. Section 905.235 is revised to read as follows:
Sec. 905.235 Assessment rate.
On and after August 1, 2023, an assessment rate of $0.02 per \4/5\-
bushel carton or equivalent is established for Florida citrus covered
under the Order.
Erin Morris,
Associate Administrator, Agricultural Marketing Service.
[FR Doc. 2024-15975 Filed 7-19-24; 8:45 am]
BILLING CODE 3410-02-P