Onions grown in Idaho and Oregon,
[Federal Register: June 15, 1998 (Volume 63, Number 114)]
[Rules and Regulations]
[Page 32598-32600]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr15jn98-3]
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 958
[Docket No. FV98-958-1 FR]
Onions Grown in Certain Designated Counties in Idaho, and Malheur County, Oregon; Decreased Assessment Rate
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Final rule.
SUMMARY: This rule decreases the assessment rate established for the Idaho-Eastern Oregon Onion Committee (Committee) under Marketing Order No. 958 for the 1998-99 and subsequent fiscal periods from $0.10 to $0.09 per hundredweight of onions handled. The Committee is responsible for local administration of the marketing order which regulates the handling of onions grown in designated counties in Idaho, and Malheur County, Oregon. Authorization to assess Idaho-Eastern Oregon onion handlers enables the Committee to incur expenses that are reasonable and necessary to administer the program. The fiscal period begins July 1 and ends June 30. The assessment rate will remain in effect indefinitely unless modified, suspended, or terminated.
EFFECTIVE DATE: June 16, 1998.
FOR FURTHER INFORMATION CONTACT: Robert J. Curry, Northwest Marketing Field Office, Marketing Order Administration Branch, Fruit and Vegetable Programs, AMS, USDA, 1220 SW Third Avenue, room 369, Portland, Oregon 97204-2807; telephone: (503) 326-2724, Fax: (503) 326- 7440; or George Kelhart, Marketing Order Administration Branch, Fruit and Vegetable Programs, AMS, USDA, room 2525-S, P.O. Box 96456, Washington, DC 20090-6456; telephone: (202) 720-2491, Fax: (202) 205- 6632. Small businesses may request information on compliance with this regulation by contacting Jay Guerber, Marketing Order Administration Branch, Fruit and Vegetable Programs, AMS, USDA, room 2525-S, P.O. Box 96456, Washington, DC 20090-6456; telephone: (202) 720-2491, Fax: (202) 205-6632.
SUPPLEMENTARY INFORMATION: This rule is issued under Marketing Agreement No. 130 and Marketing Order No. 958 (7 CFR part 958), both as amended, regulating the handling of onions grown in certain designated counties in Idaho, and Malheur County, Oregon, 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 (Department) is issuing this rule in conformance with Executive Order 12866.
This rule has been reviewed under Executive Order 12988, Civil Justice Reform. Under the order now in effect, Idaho-Eastern Oregon onion 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 onions beginning on July 1, 1998, and continue until amended, suspended, or terminated. This rule will not preempt any State or local laws, regulations, or policies, unless they present an irreconcilable conflict with this rule.
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 the Secretary 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 the Secretary 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 the Secretary's ruling on the petition, provided an action is filednot later than 20 days after the date of the entry of the ruling.
This rule decreases the assessment rate established for the Committee for the 1998-99 and subsequent fiscal periods from $0.10 to $0.09 per hundredweight of onions handled.
The order provides authority for the Committee, with the approval of the Department, to formulate an annual budget of expenses and collect assessments from handlers to administer the program. The Committee consists of six producer members, four handler members, and one public member, each of whom is 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 budget and assessment rate were discussed at a public meeting and all directly affected persons had an opportunity to participate and provide input.
For the 1996-97 and subsequent fiscal periods, the Committee recommended, and the Department approved, an assessment rate of $0.10 per hundredweight that would continue in effect from fiscal period to fiscal period unless modified, suspended, or terminated by the Secretary upon recommendation and information submitted by the Committee or other information available to the Secretary.
The Committee met on April 2, 1998, and unanimously recommended 1998-99 expenditures of $1,155,205 and an assessment rate of $0.09 per hundredweight of onions handled during the 1998-99 and subsequent fiscal periods. The Committee estimates that the 1998-99 onion crop will approximate 9,200,000 hundredweight of onions. In comparison, the 1997-98fiscal period budget was established at $1,146,916 on an estimated assessable onion harvest of 8,800,000 hundredweight of onions. The decrease is necessary to prevent expected assessment income from exceeding the
[[Page 32599]]
amount necessary to administer the program for the 1998-99 fiscal period.
The Committee anticipates that assessment income during the 1997-98 fiscal period will be approximately $100,000 higher than that estimated for its 1997-98budget. This is due to a greater level of onion production than anticipated by the Committee during its 1997-98budget deliberations. The Committee also anticipates that it will not expend $1,146,916 as budgeted for the 1997-98fiscal period, but rather will have expenditures totaling approximately $950,000. At the time the 1997-98fiscal period budget was recommended, the Committee had estimated that it would draw up to $216,916 from its operating reserve. However, since 1997-98assessment income is greater than anticipated and the respective expenditures are less than budgeted, the operating reserve may actually increase by the end of the fiscal period rather than decrease. As a consequence, the Committee estimates that its operating reserve will approximate $1,141,700 by June 30, 1998. Thus, to help ensure that the operating reserve does not exceed the maximum allowed by the order of approximately one fiscal period's expenditures, the Committee recommended that the assessment rate be decreased. Lower assessment rates were considered, but not recommended because they would not generate the income necessary to administer the program with an adequate operating reserve.
The major expenditures recommended by the Committee for the 1998-99 fiscal period include $215,205 for administration, $55,000 for production research, $750,000 for market promotion including paid advertising, $60,000 for export market development, and $75,000 for marketing order contingencies. Budgeted expenses for these items in the 1997-98fiscal period were $206,716, $55,200, $750,000, $60,000, and $75,000, respectively.
The Committee based its recommended assessment rate decrease on the 1998-99 crop estimate, the 1998-99 fiscal period expenditures estimate, as well as the current and projected balance of the operating reserve. The decreased assessment rate should provide $828,000 in income, which, when combined with interest income of $55,000 and operating reserve funds of $272,205, will be adequate to cover budgeted expenses. As noted above, the Committee estimates it will have approximately $1,141,700 in its operating reserve at the end of the current fiscal period, which should be adequate to cover any income shortages. This amount is within the maximum permitted by the order of approximately one fiscal period's expenditures (Sec. 958.44).
The assessment rate established in this rule will continue in effect indefinitely unless modified, suspended, or terminated by the Secretary 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 the Department and are locally published. Committee meetings are open to the public and interested persons may express their views at these meetings. The Department 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.
Pursuant to requirements set forth in the Regulatory Flexibility Act (RFA), the Agricultural Marketing Service (AMS) has considered the economic impact of this rule on small entities. Accordingly, the AMS has prepared this final regulatory flexibility analysis.
The purpose of the RFA is to fit regulatory actions to the scale of business 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. Thus, both statutes have small entity orientation and compatibility.
There are approximately 35 handlers of Idaho-Eastern Oregon onions who are subject to regulation under the order and approximately 260 onion producers in the regulated production area. Small agricultural service firms have been defined by the Small Business Administration (13 CFR 121.601) as those having annual receipts of less than $5,000,000, and small agricultural producers are defined as those having annual receipts of less than $500,000. The majority of Idaho- Eastern Oregon onion handlers and producers may be classified as small entities.
This rule decreases the assessment rate established for the Committee and collected from handlers for the 1998-99 and subsequent fiscal periods from $0.10 to $0.09 per hundredweight of onions handled. Both the $0.09 assessment rate and the 1998-99 budget of $1,155,205 were unanimously recommended by the Committee at its April 2, 1998, meeting. The assessment rate established by this action is $0.01 lower than the 1997-98rate. The Committee recommended a decreased assessment rate to help ensure that the operating reserve does not exceed the maximum allowed by the order of approximately one fiscal period's expenditures. The anticipated crop of 9,200,000 hundredweight is approximately 400,000 hundredweight larger than the crop estimate used to establish the 1997-98budget. The $0.09 rate should provide $828,000 in assessment income, which, when combined with interest income of $55,000 and $272,205 from the operating reserve, will be adequate to meet the 1998-99 fiscal period's budgeted expenses.
The Committee reviewed and unanimously recommended 1998-99 expenditures of $1,155,205 which includes increases in administrative expenses, salaries, and committee expenses. Prior to recommending this budget, the Committee considered information from various sources, including the Idaho-Eastern Oregon Onion Executive, Research, Promotion, and Export Development Committees. Alternative expenditure levels were discussed and rejected by these subcommittees, and ultimately by the full Committee, based upon the relative value of various research and promotion projects to the Idaho-Eastern Oregon onion industry.
The major expenditures recommended by the Committee for the 1998-99 fiscal period include $215,205 for administration, $55,000 for production research, $750,000 for market promotion including paid advertising, $60,000 for export market development, and $75,000 for marketing order contingencies. Budgeted expenses for these items in the 1997-98fiscal period were $206,716, $55,200, $750,000, $60,000, and $75,000, respectively.
A review of historical information and preliminary information pertaining to the upcoming season indicates that the F.O.B. price for the 1998-99 onion season could average $13.10 per hundredweight of onions. Therefore, the estimated assessment revenue for the 1998-99 fiscal period ($828,000) as a percentage of the projected total F.O.B. revenue ($120,520,000) would be 0.007 percent. This figure indicates that the $0.09 assessment rate will have a
[[Page 32600]]
relatively insignificant impact on the Idaho-Eastern Oregon onion industry.
This action decreases 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 will be offset by the benefits derived by the operation of the order. In addition, the Committee's meeting was widely publicized throughout the Idaho-Eastern Oregon onion industry and all interested persons were invited to attend the meeting and participate in Committee deliberations on all issues. Like all Committee meetings, the April 2, 1998, meeting was a public meeting and all entities, both large and small, were able to express views on this issue.
This rule imposes no additional reporting or recordkeeping requirements on either small or large 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.
The Department has not identified any relevant Federal rules that duplicate, overlap, or conflict with this rule.
A proposed rule concerning this action was published in the Federal Register on May 15, 1998 (63 FR 26999). A copy of the proposed rule was also sent via facsimile transmission to the administrative office of the Committee, which in turn notified Committee members and industry members. The proposal was also made available through the Internet by the Government Printing Office.
A 15-day comment period ending June 1, 1998, was provided to allow interested persons the opportunity to respond to the request for information and comments. No comments were received in response to the proposal.
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 is also found and determined that good cause exists for not postponing the effective date of this rule until 30 days after publication in the Federal Register because: (1) The Committee needs to have sufficient funds to pay its expenses which are incurred on a continuous basis; (2) the 1998-99 fiscal period begins on July 1, 1998, and the order requires that the rate of assessment for each fiscal period apply to all assessable onions handled during such fiscal period; (3) handlers are aware of this action which was recommended by the Committee at a public meeting; and (4) a 15-day comment period was provided for in the proposed rule, and no comments were received.
List of Subjects in 7 CFR Part 958
Marketing agreements, Onions, Reporting and recordkeeping requirements.
For the reasons set forth in the preamble, 7 CFR part 958 is amended as follows:
PART 958--ONIONS GROWN IN CERTAIN DESIGNATED COUNTIES IN IDAHO, AND MALHEUR COUNTY, OREGON
-
The authority citation for 7 CFR part 958 continues to read as follows:
Authority: 7 U.S.C. 601-674.
-
Section 958.240 is revised to read as follows:
Sec. 958.240 Assessment rate.
On and after July 1, 1998, an assessment rate of $0.09 per hundredweight is established for Idaho-Eastern Oregon onions.
Dated: June 10, 1998. Robert C. Keeney, Deputy Administrator, Fruit and Vegetable Programs.
[FR Doc. 98-15835Filed6-12-98; 8:45 am]
BILLING CODE 3410-02-P
