[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
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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.

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

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