[Federal Register Volume 71, Number 21 (Wednesday, February 1, 2006)]
[Rules and Regulations]
[Pages 5157-5159]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 06-947]



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Rules and Regulations
                                                Federal Register
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Federal Register / Vol. 71, No. 21 / Wednesday, February 1, 2006 / 
Rules and Regulations

[[Page 5157]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 905

[Docket No. FV06-905-1 IFR]


Oranges, Grapefruit, Tangerines, and Tangelos Grown in Florida; 
Increased Assessment Rate

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Interim final rule with request for comments.

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SUMMARY: This rule increases the assessment rate established for the 
Citrus Administrative Committee (Committee) for the 2005-06 and 
subsequent fiscal periods from $0.006 to $0.008 per \4/5\ bushel carton 
of oranges, grapefruit, tangerines, and tangelos handled. The Committee 
locally administers the marketing order which regulates the handling of 
oranges, grapefruit, tangerines, and tangelos grown in Florida. 
Assessments upon Florida citrus handlers are used by the Committee to 
fund reasonable and necessary expenses of the program. The fiscal 
period begins August 1 and ends July 31. The assessment rate will 
remain in effect indefinitely unless modified, suspended, or 
terminated.

DATES: February 2, 2006. Comments received by April 3, 2006, will be 
considered prior to issuance of a final rule.

ADDRESSES: Interested persons are invited to submit written comments 
concerning this rule. Comments must be sent to the Docket Clerk, 
Marketing Order Administration Branch, Fruit and Vegetable Programs, 
AMS, USDA, 1400 Independence Avenue, SW., STOP 0237, Washington, DC 
20250-0237; Fax: (202) 720-8938; E-mail: <a href="/cdn-cgi/l/email-protection#ef82808e8dc18b808c848a9b8c838a9d84af9a9c8b8ec1888099"><span class="__cf_email__" data-cfemail="a7cac8c6c589c3c8c4ccc2d3c4cbc2d5cce7d2d4c3c689c0c8d1">[email protected]</span></a>; or 
Internet: http://www.regulations.gov. 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, or can be viewed at: 
http://www.ams.usda.gov/fv/moab.html.

FOR FURTHER INFORMATION CONTACT: Doris Jamieson, Southeast Marketing 
Field Office, Marketing Order Administration Branch, Fruit and 
Vegetable Programs, AMS, USDA; telephone: (863) 324-3375, Fax: (863) 
325-8793; or George Kelhart, Technical Advisor, Marketing Order 
Administration Branch, Fruit and Vegetable Programs, AMS, USDA, 1400 
Independence Avenue, SW., STOP 0237, Washington, DC 20250-0237; 
Telephone: (202) 720-2491, Fax: (202) 720-8938.
    Small businesses may request information on complying with this 
regulation by contacting Jay Guerber, Marketing Order Administration 
Branch, Fruit and Vegetable Programs, AMS, USDA, 1400 Independence 
Avenue, SW., STOP 0237, Washington, DC 20250-0237; Telephone: (202) 
720-2491, Fax: (202) 720-8938, or E-mail: <a href="/cdn-cgi/l/email-protection#bff5dec691f8cadacddddacdffcaccdbde91d8d0c9"><span class="__cf_email__" data-cfemail="efa58e96c1a89a8a9d8d8a9daf9a9c8b8ec1888099">[email protected]</span></a>.

SUPPLEMENTARY INFORMATION: This rule is issued under Marketing 
Agreement No. 84 and Marketing Order No. 905, both as amended (7 CFR 
part 905), regulating the handling of oranges, grapefruit, tangerines, 
and tangelos grown in Florida, 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 (USDA) is issuing this rule in 
conformance with Executive Order 12866.
    This rule has been reviewed under Executive Order 12988, Civil 
Justice Reform. Under the marketing 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 
as issued herein will be applicable to all assessable oranges, 
grapefruit, tangerines, and tangelos grown in Florida, beginning August 
1, 2005, 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 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 rule increases the assessment rate established for the 
Committee for the 2005-06 and subsequent fiscal periods from $0.006 per 
\4/5\ bushel carton to $0.008 per \4/5\ bushel carton of oranges, 
grapefruit, tangerines, and tangelos grown in Florida.
    The Florida citrus marketing order provides authority for the 
Committee, with the approval of USDA, to formulate an annual budget of 
expenses and collect assessments from handlers to administer the 
program. The members of the Committee are producers and handlers of 
oranges, grapefruit, tangerines, and tangelos. They are 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 assessment rate is formulated and 
discussed in a public meeting. Thus, all directly affected persons have 
an opportunity to participate and provide input.
    For the 2003-04 and subsequent fiscal periods, the Committee 
recommended, and USDA approved, an assessment rate that would continue 
in effect from fiscal period to fiscal period unless modified, 
suspended, or terminated by USDA upon recommendation and information 
submitted by the Committee or other information available to USDA.
    The Committee met on December 16, 2005, and unanimously recommended

[[Page 5158]]

2005-06 expenditures of $209,000 and an assessment rate of $0.008 per 
\4/5\ bushel of oranges, grapefruit, tangerines, and tangelos grown in 
Florida based on a crop estimate of 24 million \4/5\ bushels. In 
comparison, last year's budgeted expenditures were $300,000. The 
recommended assessment rate is $0.002 higher than the $0.006 rate 
currently in effect.
    The Committee originally met May 10, 2005, and recommended a budget 
of $220,000 and that the assessment rate be maintained at $0.006. The 
Committee had anticipated reduced shipments due to the lingering 
effects from the hurricanes the industry experienced during the 2004-05 
season. However, in October 2005, the industry experienced additional 
crop loss due to the effects of Hurricane Wilma. Assessable cartons for 
2005-06 are now estimated to be 24 million, down from the 36 million 
originally estimated for the season. Further, the new estimate is close 
to 28 million cartons under shipments for the 2003-04 season, the most 
recent season not impacted by hurricanes. Consequently, it is necessary 
to increase the assessment rate.
    The major expenditures recommended by the Committee for the 2005-06 
fiscal year include $106,150 for salaries, $25,000 for Manifests-USDA-
FDACS, $16,700 for retirement plan, $14,550 for insurance and bonds, 
and $8,250 for payroll taxes. Budgeted expenses for these items in 
2004-05 were $131,000, $25,000, $20,500, $21,000, and $10,600, 
respectively.
    The assessment rate recommended by the Committee was derived by 
dividing anticipated expenses by expected shipments of oranges, 
grapefruit, tangerines, and tangelos. As mentioned earlier, Florida 
citrus shipments for the year are estimated at 24 million \4/5\ 
bushels, which should provide $192,000 in assessment income. Income 
derived from handler assessments, along with interest income and funds 
from the Committee's authorized reserve will be adequate to cover 
budgeted expenses. Funds in the reserve currently total approximately 
$30,000 and are within the maximum permitted by the order of not to 
exceed one half of one fiscal period's expenses as stated in Sec.  
905.42(a).
    The assessment rate established in this rule will continue in 
effect indefinitely unless modified, suspended, or terminated by USDA 
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 USDA. 
Committee meetings are open to the public and interested persons may 
express their views at these meetings. USDA 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. The Committee's 2005-06 budget and those 
for subsequent fiscal periods will be reviewed and, as appropriate, 
approved by USDA.

Initial Regulatory Flexibility Analysis

    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, 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 8,500 producers of oranges, grapefruit, 
tangerines, and tangelos in the production area and approximately 75 
handlers subject to regulation under the marketing order. Small 
agricultural producers are defined by the Small Business Administration 
(SBA) as those having annual receipts less than $750,000, and small 
agricultural service firms are defined as those whose annual receipts 
are less than $6,000,000 (13 CFR 121.201).
    Based on industry and Committee data, the average annual f.o.b. 
price for fresh Florida citrus during the 2004-05 season was 
approximately $11.54 per \4/5\ bushel carton, and total fresh shipments 
for the 2004-05 season were approximately 30.2 million cartons of 
citrus. Using the average f.o.b. price, at least 70 percent of the 
Florida citrus handlers could be considered small businesses under 
SBA's definition. In addition, based on production and grower prices 
reported by the National Agricultural Statistics Service, and the total 
number of Florida citrus growers, the average annual grower revenue is 
approximately $87,600. In view of the foregoing, it can be concluded 
that the majority of handlers and producers of Florida citrus may be 
classified as small entities.
    This rule increases the assessment rate established for the 
Committee and collected from handlers for the 2005-06 and subsequent 
fiscal periods from $0.006 to $0.008 per \4/5\ bushel carton of 
oranges, grapefruit, tangerines, and tangelos. The Committee 
unanimously recommended 2005-06 expenditures of $209,000 and an 
assessment rate of $0.008 per \4/5\ bushel carton. The recommended 
assessment rate is $0.002 higher than the rate now in effect. The 
quantity of assessable oranges, grapefruit, tangerines, and tangelos 
for the 2005-06 season is estimated at 24 million \4/5\ bushel cartons. 
Thus, the $0.008 rate should provide $192,000 in assessment income. 
Income derived from handler assessments, along with interest income, 
and funds from the Committee's reserve will be adequate to cover 
budgeted expenses.
    The major expenditures recommended by the Committee for the 2005-06 
fiscal year include $106,150 for salaries, $25,000 for Manifests-USDA-
FDACS, $16,700 for retirement plan, $14,550 for insurance and bonds, 
and $8,250 for payroll taxes. Budgeted expenses for these items in 
2004-05 were $131,000, $25,000, $20,500, $21,000, and $10,600, 
respectively.
    The Committee originally met May 10, 2005, and recommended a budget 
of $220,000 and that the assessment rate be maintained at $0.006. The 
Committee had anticipated reduced shipments due to the lingering 
effects from the hurricanes the industry experienced during the 2004-05 
season. However, in October 2005, the industry experienced additional 
crop loss due to the effects of Hurricane Wilma. Assessable cartons for 
2005-06 are now estimated to be 24 million, down from the 36 million 
originally estimated for the season. Further, the new estimate is close 
to 28 million cartons under shipments for the 2003-04 season, the most 
recent season not impacted by hurricanes. Consequently, it is necessary 
to increase the assessment rate to meet 2005-06 budget requirements.
    The Committee reviewed and unanimously recommended 2005-06 
expenditures of $209,000. Prior to arriving at this budget, the 
Committee considered information from various sources including the 
Committee's Budget Subcommittee. Alternative assessment rates were 
discussed based on different estimates of assessable cartons and budget 
expenses. The assessment rate of $0.008 per \4/5\ bushel

[[Page 5159]]

carton of assessable oranges, grapefruit, tangerines, and tangelos was 
then determined by dividing the total recommended budget by the 
quantity of assessable Florida citrus, estimated at 24 million \4/5\ 
bushel cartons for the 2005-06 season taking into consideration the 
availability of reserve funds and interest income. This assessment rate 
will yield approximately $17,000 under anticipated budgeted expenses 
with the deficit funds to be drawn from reserves and interest income.
    A review of historical information and preliminary information 
pertaining to the upcoming 2005-06 fiscal period indicates that the 
grower price for the 2005-06 season could range between $1.23 and $7.18 
per \4/5\ bushel of oranges, grapefruit, tangerines, and tangelos. 
Therefore, the estimated assessment revenue for the 2005-06 fiscal 
period as a percentage of total grower revenue could range between .11 
and .65 percent.
    This action increases 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 
marketing order.
    In addition, the Committee's meeting was widely publicized 
throughout the Florida citrus industry and all interested persons were 
invited to attend the meeting and participate in Committee 
deliberations on all issues. Like all Committee meetings, the December 
16, 2005 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 action imposes no 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.
    USDA has not identified any relevant Federal rules that duplicate, 
overlap, or conflict with this rule.
    A small business guide on complying with fruit, vegetable, and 
specialty crop marketing agreements and orders may be viewed at: http://www.ams.usda.gov/fv/moab.html. Any questions about the compliance 
guide should be sent to Jay Guerber at the previously mentioned address 
in the FOR FURTHER INFORMATION CONTACT section.
    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 upon good 
cause that it is impracticable, unnecessary, and contrary to the public 
interest to give preliminary notice prior to putting this rule into 
effect, and 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 2005-06 fiscal period began August 1, 2005, 
and the marketing order requires that the rate of assessment for each 
fiscal period apply to all assessable Florida citrus handled during 
such fiscal period; (2) the Committee needs to have sufficient funds to 
pay its expenses which are incurred on a continuous basis; (3) handlers 
are aware of this action which was unanimously recommended by the 
Committee at a public meeting and is similar to other assessment rate 
actions issued in past years; and (4) this interim final rule provides 
a 60-day comment period, and all comments timely received will be 
considered prior to finalization of this rule.

List of Subjects in 7 CFR Part 905

    Grapefruit, Oranges, Tangelos, Tangerines, Marketing agreements, 
Reporting and recordkeeping requirements.

0
For the reasons set forth in the preamble, 7 CFR part 905 is amended as 
follows:

PART 905--ORANGES, GRAPEFRUIT, TANGERINES, AND TANGELOS 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, 2005, an assessment rate of $0.008 per \4/5\ 
bushel carton or equivalent is established for Florida citrus covered 
under the order.

    Dated: January 27, 2006.
Lloyd C. Day,
Administrator, Agricultural Marketing Service.
[FR Doc. 06-947 Filed 1-30-06; 9:06 am]
BILLING CODE 3410-02-P


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