[Federal Register Volume 63, Number 67 (Wednesday, April 8, 1998)]
[Proposed Rules]
[Pages 17125-17127]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-9200]
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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. 63, No. 67 / Wednesday, April 8, 1998 /
Proposed Rules
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DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 956
[Docket No. FV98-956-2 PR]
Sweet Onions Grown in the Walla Walla Valley of Southeast
Washington and Northeast Oregon; Increased Assessment Rate
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Proposed rule.
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SUMMARY: This rule would increase the assessment rate established for
the Walla Walla Sweet Onion Committee (Committee) under Marketing Order
No. 956 for the 1998-99 and subsequent fiscal periods from $0.19 to
$0.21 per 50-pound bag or equivalent of onions handled. The Committee
is responsible for local administration of the marketing order which
regulates the handling of sweet onions grown in portions of Walla Walla
County, Washington, and Umatilla County, Oregon. Authorization to
assess Walla Walla Sweet Onion handlers enables the Committee to incur
expenses that are reasonable and necessary to administer the program.
The fiscal period begins June 1 and ends May 31. The assessment rate
would remain in effect indefinitely unless modified, suspended, or
terminated.
DATES: Comments must be received by May 8, 1998.
ADDRESSES: Interested persons are invited to submit written comments
concerning this rule. Comments must be sent to the Docket Clerk, Fruit
and Vegetable Programs, AMS, USDA, room 2525-S, PO Box 96456,
Washington, DC 20090-6456; Fax: (202) 205-6632. Comments should
reference the docket 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.
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, PO 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, PO Box
96456, Washington, DC 20090-6456; telephone: (202) 720-2491, Fax: (202)
205-6632.
SUPPLEMENTARY INFORMATION: This rule is issued under Marketing
Agreement and Order No. 956 (7 CFR part 956), regulating the handling
of sweet onions grown in the Walla Walla Valley of southeast Washington
and northeast 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, Walla Walla Sweet Onion
handlers are subject to assessments. Funds to administer the order are
derived from such assessments. It is intended that the assessment rate
proposed herein would be applicable to all assessable sweet onions
beginning on June 1, 1998, and continue until amended, suspended, or
terminated. This rule would 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 filed not
later than 20 days after the date of the entry of the ruling.
This rule would increase the assessment rate established for the
Committee for the 1998-99 and subsequent fiscal periods from $0.19 per
50-pound bag or equivalent to $0.21 per 50-pound bag or equivalent of
Walla Walla Sweet 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, three 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 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 February 17, 1998, and unanimously recommended
1998-99 expenditures of $97,272. In a vote with six favoring, three
opposing, and one abstaining, the Committee recommended an assessment
rate of $0.21 per 50-pound bag or equivalent handled during the 1998-99
and subsequent fiscal periods. The Committee estimated that the 1998
sweet onion crop will approximate 463,200 50-pound bags or equivalents
of onions. In comparison, the 1997-98 fiscal period budget was
established at $126,682 with an estimated assessable
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poundage of 667,750 50-pound bags or equivalents of sweet onions. In an
effort to partially offset the loss of assessment income due to the
more conservative 1998 crop estimate, the Committee recommended the
$0.02 increase.
In both the 1996 and 1997 seasons, the actual quantity of
assessable sweet onions produced for the fresh market was less than the
Committee had estimated for the purpose of establishing the respective
budgets. Actual assessment income earned during the 1997-98 fiscal
period was approximately $30,000 less than was estimated for the 1997-
98 budget, and for the 1996-97 fiscal period, actual assessment income
was approximately $26,000 less than was budgeted. For the 1998-99
fiscal period, the Committee made its 1998 assessable crop estimate
based on a lower average yield per acre than was used during the past
two seasons. Based on a reported 772 acres planted, the Committee is
anticipating a 1998 harvest averaging 600 50-pound bags or equivalents
per acre. Thus, the 1998-99 fiscal period budget is formulated based on
a crop estimate of 463,200 50-pound bags or equivalents of Walla Walla
Sweet Onions. If the assessment rate is not increased from the 1997-98
fiscal period rate of $0.19, funds would fall approximately $9,264
short of 1998-99 fiscal period budgeted expenses, and this is not
acceptable to a majority of the Committee. The members opposed believed
that the assessment rate should be increased more than $0.02 per 50-
pound bag or equivalent, so more funds could be earmarked for promotion
and paid advertising. The public member abstained because of his desire
to remain neutral on these issues.
After much discussion, the major expenditures recommended by the
Committee for the 1998-99 fiscal period include $43,890 for
administration, $10,000 for production research, $35,890 for market
promotion including paid advertising, and $4,500 for marketing order
compliance. Budgeted expenses for these items in the 1997-98 fiscal
period were $41,700, $15,000, $51,000, and $9,000, respectively.
The Committee based its recommended assessment rate increase on the
1998 crop estimate and its estimate of 1998-99 fiscal period
expenditures, including administrative costs and desired research and
promotion projects. The Committee also took into consideration the
impact an increase in the assessment rate would have on producers and
handlers. The increased assessment rate should provide $97,272 in
income which would be adequate to cover budgeted expenses. In the event
the 1998 assessable sweet onion crop falls short of anticipated yields,
the Committee estimates it will have approximately $25,000 in its
operating reserve at the beginning of the 1998-99 fiscal period (June
1, 1998), which should be adequate to cover any assessment shortages.
This amount is within the maximum permitted by the order of
approximately two fiscal period's budgeted expenses (Sec. 956.44).
The proposed assessment rate would 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 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 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 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.
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 initial 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 60 producers of Walla Walla Sweet Onions in
the production area and approximately 35 handlers subject to regulation
under the order. Small agricultural producers have been defined by the
Small Business Administration (13 CFR 121.601) as those having annual
receipts less than $500,000, and small agricultural service firms are
defined as those whose annual receipts are less than $5,000,000. The
majority of Walla Walla Sweet Onion producers and handlers may be
classified as small entities.
This rule would increase the assessment rate established for the
Committee and collected from handlers for the 1998-99 and subsequent
fiscal periods from $0.19 per 50-pound bag or equivalent to $0.21 per
50-pound bag or equivalent of Walla Walla Sweet Onions handled. The
Committee unanimously recommended 1998-99 expenditures of $97,272, and,
with 6 members favoring, 3 members opposing and 1 member abstaining,
recommended the $0.21 per 50-pound bag or equivalent assessment rate.
The proposed assessment rate is $0.02 higher than the rate currently in
effect. The Committee recommended an increased assessment rate to help
offset the smaller projected crop of assessable sweet onions in 1998.
The anticipated crop of 463,200 50-pound bags or equivalents is
approximately 30 percent less than each of the 1996 and 1997 crops. The
$0.21 rate should provide $97,272 in assessment income and be adequate
to meet 1998-99 fiscal period expenses.
The Committee discussed alternatives to this proposed rule,
including alternative expenditure and assessment levels. The Committee
discussed various alternative expenditure levels for promotion,
production research, and marketing order compliance. Further, the
Committee discussed various levels of assessment from the current $0.19
to as much as $0.25 per 50-pound bag or equivalent of sweet onions.
Action was taken by the Committee on a motion to increase the
assessment rate by $0.01. The vote failed to carry a majority, however,
since a $0.01 increase would not have adequately funded desired
expenditures. The members opposed believed that the assessment rate
should be increased more than $0.02 per 50-pound bag or equivalent, so
more funds could be dedicated to promotion and paid advertising. The
public member abstained because of his desire to remain neutral on
these issues.
After much discussion, the major expenditures recommended by the
Committee for the 1998-99 fiscal period include $43,000 for
administration, $10,000 for production research, $35,890 for market
promotion including paid advertising, and $4,500 for marketing order
compliance. Budgeted expenses for these items in the 1997-98 fiscal
period were $41,700, $15,000, $51,000, and $9,000, respectively.
Recent price information indicates that producer prices for all
sizes and grades of Walla Walla Sweet Onions for the 1998 shipping
season will range between $4.50 and $12.00 per 50-pound bag or
equivalent. Thus, the estimated
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assessment revenue for the 1998-99 fiscal period as a percentage of
total producer revenue would range between 0.017 and 0.046 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 order.
In addition, the Committee's meeting was widely publicized throughout
the Walla Walla Sweet 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 February
17, 1998, 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 information on the regulatory and
informational impacts of this action on small businesses.
This proposed rule would impose no additional reporting or
recordkeeping requirements on either small or large Walla Walla Sweet
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 30-day comment period is provided to allow interested persons the
opportunity to respond to this request for information and comments.
Thirty days is deemed appropriate 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 June 1, 1998,
and the order requires that the rate of assessment for each fiscal
period apply to all assessable sweet onions handled during such fiscal
period; and (3) handlers are aware of this action which was 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 956
Sweet onions, Marketing agreements, Reporting and recordkeeping
requirements.
For the reasons set forth in the preamble, 7 CFR part 956 is
proposed to be amended as follows:
PART 956--SWEET ONIONS GROWN IN THE WALLA WALLA VALLEY OF SOUTHEAST
WASHINGTON AND NORTHEAST OREGON
1. The authority citation for 7 CFR part 956 continues to read as
follows:
Authority: 7 U.S.C. 601-674.
2. Section 956.202 is proposed to be revised to read as follows:
Sec. 956.202 Assessment rate.
On and after June 1, 1998, an assessment rate of $0.21 per 50-pound
bag or equivalent is established for Walla Walla Sweet Onions.
Dated: April 2, 1998.
Robert C. Keeny,
Deputy Administrator, Fruit and Vegetable Programs.
[FR Doc. 98-9200 Filed 4-7-98; 8:45 am]
BILLING CODE 3410-02-P
