[Federal Register Volume 63, Number 114 (Monday, June 15, 1998)]
[Rules and Regulations]
[Pages 32598-32600]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-15835]
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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.
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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 filed not
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
1997-98 fiscal 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 1997-98 budget. This is due to a greater level of onion
production than anticipated by the Committee during its 1997-98 budget
deliberations. The Committee also anticipates that it will not expend
$1,146,916 as budgeted for the 1997-98 fiscal period, but rather will
have expenditures totaling approximately $950,000. At the time the
1997-98 fiscal period budget was recommended, the Committee had
estimated that it would draw up to $216,916 from its operating reserve.
However, since 1997-98 assessment 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
1997-98 fiscal 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 1997-98 rate. 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 1997-98 budget. 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
1997-98 fiscal 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
1. The authority citation for 7 CFR part 958 continues to read as
follows:
Authority: 7 U.S.C. 601-674.
2. 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. 98-15835 Filed 6-12-98; 8:45 am]
BILLING CODE 3410-02-P
