Oranges and Grapefruit Grown in Lower Rio Grande Valley in Texas; Increased Assessment Rate

DEPARTMENT OF AGRICULTURE <SUBAGY>Agricultural Marketing Service</SUBAGY> <CFR>7 CFR Part 906</CFR> <DEPDOC>[Doc. No. AMS-SC-24-0046]</DEPDOC> <SUBJECT>Oranges and Grapefruit Grown in Lower Rio Grande Valley in Texas; Increased Assessment Rate</SUBJECT> <HD SOURCE="HED">AGENCY:</HD> Agricultural Marketing Service, Department of Agriculture (USDA). <HD SOURCE="HED">ACTION:</HD> Proposed rule. <SUM> <HD SOURCE="HED">SUMMARY:</HD> This proposed rule would implement a recommendation from the Texas Valley Citrus Committee (Committee) to increase the assessment rate established for the 2024-2025 and subsequent fiscal periods from $0.03 to $0.04 per 7/10-bushel carton or equivalent of oranges and grapefruit grown in Texas. The proposed assessment rate would remain in effect indefinitely unless modified, suspended, or terminated. </SUM> <EFFDATE> <HD SOURCE="HED">DATES:</HD> Comments must be received by February 14, 2025. </EFFDATE> <HD SOURCE="HED">ADDRESSES:</HD> Interested persons are invited to submit written comments concerning this proposed rule. Comments can be sent to the Docket Clerk, Market Development Division, Specialty Crops Program, AMS, USDA, 1400 Independence Avenue SW, STOP 0237, Washington, DC 20250-0237. Comments can also be sent to the Docket Clerk electronically by Email: <E T="03">MarketingOrderComment@usda.gov</E> or via the internet at: <E T="03">https://www.regulations.gov.</E> Comments should reference the document number and the date and page number of this issue of the <E T="04">Federal Register</E> . Comments submitted in response to this proposed rule will be included in the record, will be made available to the public and can be viewed at: <E T="03">https://www.regulations.gov.</E> Please be advised that the identity of the individuals or entities submitting the comments will be made public on the internet at the address provided above. <FURINF> <HD SOURCE="HED">FOR FURTHER INFORMATION CONTACT:</HD> Delaney Fuhrmeister, Marketing Specialist, or Christian D. Nissen, Chief, Southeast Region Branch, Market Development Division, Specialty Crops Program, AMS, USDA; telephone: (863) 324-3375 or email: <E T="03">Delaney.Fuhrmeister@usda.gov</E> or <E T="03">Christian.Nissen@usda.gov.</E> Small businesses may request information on complying with this regulation by contacting Antoinette Carter, Market Development Division, Specialty Crops Program, AMS, USDA, 1400 Independence Avenue SW, STOP 0237, Washington, DC 20250-0237; telephone: (202) 720-8085, or email: <E T="03">Antoinette.Carter@usda.gov.</E> </FURINF> <SUPLINF> <HD SOURCE="HED">SUPPLEMENTARY INFORMATION:</HD> This action, pursuant to 5 U.S.C. 553, proposes to amend regulations issued to carry out a marketing order as defined in 7 CFR 900.2(j). This proposed rule is issued under Marketing Order No. 906 as amended (7 CFR part 906), regulating the handling of oranges and grapefruit grown in the Lower Rio Grande Valley in Texas. Part 906 (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 producers and handlers of oranges and grapefruit operating within the area of production. The Agricultural Marketing Service (AMS) is issuing this proposed 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 proposed action falls within a category of regulatory actions that the Office of Management and Budget (OMB) exempted from Executive Order 12866 review. This proposed rule has been reviewed under Executive Order 13175—Consultation and Coordination with Indian Tribal Governments, which requires Federal agencies to consider whether their rulemaking actions would have Tribal implications. AMS has determined that this proposed 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 proposed rule has been reviewed under Executive Order 12988—Civil Justice Reform. Under the Order now in effect, Texas orange and grapefruit handlers are subject to assessments. Funds to administer the Order are derived from such assessments. It is intended that the proposed assessment rate would be applicable to all assessable Texas citrus for the 2024-2025 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 608c(15)(A) of the Act, 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 not later than 20 days after the date of the entry of the ruling. This proposed rule would increase the assessment rate for Texas oranges and grapefruit handled under the Order from $0.03 to $0.04 per 7/10-bushel carton or equivalent for the 2024-2025 fiscal period and subsequent fiscal periods. Sections 906.33 and 906.34 of the Order 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 of the Committee are familiar with the Committee's needs and with the costs of goods and services in their local area and can 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 2022-23 and subsequent fiscal periods, the Committee recommended, and AMS approved, an assessment rate of $0.03 per 7/10-bushel carton or equivalent of Texas citrus within the production area. 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. The Committee met on June 18, 2024, and unanimously recommended 2024-2025 fiscal period expenditures of $134,970 and an increased assessment rate of $0.04 per 7/10-bushel carton or equivalent of Texas oranges and grapefruit handled for 2024-2025 fiscal periods. The budgeted expenditures remain unchanged compared to last year's recommended expenditures. The proposed assessment rate of $0.04 is $0.01 higher than the rate currently in effect. The Committee recommended increasing the assessment rate to cover expenses for the current fiscal year and replenish reserves. The Committee estimates shipments for the 2024-2025 fiscal period to be around 4,000,000 7/10-bushel cartons or equivalents, similar to the 3,976,000 7/10-bushel cartons or equivalents handled in the 2023-2024 fiscal period. The major expenditures recommended by the Committee for the 2024-2025 fiscal period include $66,220 for management expenses, $50,000 for compliance, and $18,750 for general administrative expenses, the same as budgeted for these items during the 2023-2024 fiscal period. At the current assessment rate of $0.03, the expected 4,000,000 7/10-bushel cartons or equivalents would generate $120,000 in assessment revenue (4,000,000 7/10-bushel cartons or equivalents multiplied by $0.03 assessment rate), which would not cover budgeted expenses. Further, shipments from the 2023-2024 fiscal period were approximately 4,000,000 7/10-bushel cartons or equivalents of citrus, which was well below the estimated crop of 5,000,000 7/10-bushel cartons or equivalents. The smaller crop forced the Committee to use the remainder of their reserves to help cover 2023-2024 fiscal period expenses. Consequently, the Committee recommended increasing the assessment rate to meet necessary expenses and restore reserves. By increasing the assessment rate from $0.03 to $0.04, assessment income would generate $160,000 in assessment revenue (4,000,000 7/10-bushel cartons or equivalents multiplied by $0.04 assessment rate). This amount should be appropriate to ensure the Committee has sufficient revenue to fully fund its recommended 2024-2025 budgeted expenditures and replenish the Committee's reserve funds. The Committee derived the recommended assessment rate by reviewing anticipated expenses, the estimated volume of assessable Texas citrus, and the level of funds available in the financial reserve. Income generated from handler assessments should be sufficient to meet the Committee's estimated program expenditures of $134,970. Funds available in the financial reserve (currently about $0) ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ Preview showing 10k of 21k characters. Full document text is stored and available for version comparison. ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━