37618 Federal Register / Vol. 76, No. 124 / Tuesday, June 28, 2011 / Rules and Regulations 

review, USDA received five comments 

from interested parties. In general, the 

comments addressed issues that were 

the subject of a separate notice and 

comment informal rulemaking action 

concerning proposed changes to the 

regulatory period under the marketing 

order that was completed with 

publication of a final rule on February 

5, 2010 (75 FR 5879). It is noted that the 

commenters also submitted similar 

comments in response to that 

rulemaking action. The comments have 

been addressed in that rulemaking 

proceeding. 

In considering the order’s complexity, 

AMS has determined that the marketing 

order is not unduly complex. 

During the review, the order was also 

checked for duplication and overlap 

with other regulations. AMS did not 

identify any relevant Federal rules, or 

State and local regulations that 

duplicate, overlap, or conflict with the 

marketing order for California desert 

grapes. 

The marketing order was established 

in 1980. Since its inception, AMS and 

the California desert grape industry 

have continuously monitored its 

operations. Changes in regulations have 

been implemented to reflect current 

industry operating practices, and to 

solve marketing problems as they occur. 

The goal of these evaluations is to 

assure that the order and the regulations 

implemented under it fit the needs of 

the industry and are consistent with the 

Act. 

The Committee meets whenever 

needed to discuss the marketing order 

and the various regulations issued 

thereunder, and to determine if, or 

what, changes may be necessary to 

reflect current industry practices. As a 

result, numerous regulatory changes 

have been made over the years to 

address industry operation changes and 

to improve program administration. The 

marketing order itself has never been 

amended since its inception, but several 

regulatory changes have been made 

through informal rulemaking, as noted 

above, to ensure the program continues 

to meet the industry’s needs. 

Accordingly, AMS has determined 

that the California desert grape 

marketing order should be continued. 

The marketing order was established to 

help the desert grape industry work 

with USDA to solve marketing 

problems. The marketing order 

continues to be beneficial to producers, 

handlers, and consumers. 

AMS will continue to work with the 

California desert grape industry in 

maintaining an effective program. 

Dated: June 22, 2011. 

Rayne Pegg, 

Administrator, Agricultural Marketing 

Service. 

[FR Doc. 2011–16136 Filed 6–27–11; 8:45 am] 

BILLING CODE 3410–02–P 

DEPARTMENT OF AGRICULTURE 

Agricultural Marketing Service 

7 CFR Part 955 

[Doc. No. AMS–FV–11–0016; FV11–955–1 

FR] 

Vidalia Onions Grown in Georgia; 

Change in Late Payment and Interest 

Requirements on Past Due 

Assessments 

AGENCY: Agricultural Marketing Service, 

USDA. 

ACTION: Final rule. 

SUMMARY: This rule changes the 

delinquent assessment requirements in 

effect under the marketing order for 

Vidalia onions grown in Georgia (order). 

The order regulates the handling of 

Vidalia onions grown in Georgia and is 

administered locally by the Vidalia 

Onion Committee (Committee). This 

rule establishes a late payment charge of 

10 percent on unpaid assessments that 

are 10 days past due and increases the 

interest rate applied to delinquent 

assessments from 1 percent to 1.5 

percent per month. This action should 

improve handler compliance with the 

assessment and reporting provisions of 

the order and help reduce the 

Committee’s collection expenditures. 

DATES: Effective Date: June 29, 2011. 

FOR FURTHER INFORMATION CONTACT: 

Jennie M. Varela, Marketing Specialist, 

or Christian D. Nissen, Regional 

Manager, Southeast Marketing Field 

Office, Marketing Order Administration 

Branch, Fruit and Vegetable Programs, 

AMS, USDA; Telephone: (863) 324– 

3375, Fax: (863) 325–8793, or E-mail: 

Jennie.Varela@ams.usda.gov or 

Christian.Nissen@ams.usda.gov. 

Small businesses may request 

information on complying with this 

regulation by contacting Laurel May, 

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: 

Laurel.May@ams.usda.gov. 

SUPPLEMENTARY INFORMATION: This final 

rule is issued under Marketing 

Agreement and Order No. 955, both as 

amended (7 CFR part 955), regulating 

the handling of Vidalia onions grown in 

Georgia, 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 final rule has been reviewed 

under Executive Order 12988, Civil 

Justice Reform. This rule is not intended 

to have retroactive effect. 

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. A 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 final rule changes the delinquent 

assessment requirements in effect under 

the order. This rule establishes a late 

payment charge of 10 percent on unpaid 

assessments that are 10 days past due 

and increases the interest rate applied to 

delinquent assessments from 1 percent 

to 1.5 percent per month. The change 

was recommended unanimously by the 

Committee at a meeting on February 17, 

2011. 

Section 955.42 of the order provides 

authority for imposition of a late charge 

or interest rate or both on delinquent 

assessments. Section 955.142 of the 

order’s rules and regulations prescribes 

the requirements for delinquent 

assessments. Prior to this action, 

§ 955.142 specified that each handler 

pay an interest charge of 1 percent per 

month on any unpaid assessments and 

accrued unpaid interest beginning the 

day after the assessments are due. This 

rule modifies § 955.142 to include a 10 

percent late charge on delinquent 

assessments that are 10 days past due 

and increases the interest rate on 

delinquent assessments to 1.5 percent 

per month. 

The order requires handlers to pay to 

the Committee a pro rata assessment on 

the volume of onions handled. The 

volume of onions handled is based on 

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Federal Register / Vol. 76, No. 124 / Tuesday, June 28, 2011 / Rules and Regulations 37619 

a monthly shipping report handlers are 

required to submit to the Committee. 

The monthly shipping report and its 

associated assessments are due in the 

Committee office by the fifth day of the 

month following the month in which 

the shipments were made, unless the 

fifth day falls on a weekend or holiday, 

and then the due date is the first prior 

business day. 

At the Committee’s January 20, 2011, 

meeting, Committee staff indicated that 

some handlers have been late in 

reporting shipments and paying the 

associated assessments, and that this 

has been an ongoing problem for the last 

few seasons. The handlers eventually 

comply with the order requirements, but 

late payments deprive the Committee of 

expected operating income and increase 

Committee costs. 

Vidalia onions are typically shipped 

from late April through August of each 

year. This creates a compressed window 

in which the Committee collects the 

funds it uses throughout the year for its 

operating expenses. In addition, the 

Committee spends the majority of funds 

allocated to promotion during the 

shipping season. With promotional 

expenses accounting for more than 50 

percent of the Committee’s total budget, 

timely payment of assessments is 

necessary for the Committee to have 

funds available to cover expenditures. 

When several handlers are late in 

paying assessments, the Committee can 

lack the operating funds required. If 

sufficient operating funds are not 

available, the Committee has to borrow 

money, increasing operating costs. 

Further, there are costs associated 

with trying to collect the delinquent 

assessments. Some handlers require 

numerous contacts from Committee staff 

by mail and telephone, with others 

requiring on-site visits from the 

Committee’s compliance officer. 

Throughout a season, these collection 

activities expend time and resources. 

In addition to the costs associated 

with unpaid assessments, the failure of 

handlers to report on time is also a 

problem for the Committee. The 

monthly shipping report serves several 

functions, including providing volume 

information on which handler 

assessments are based. Without 

complete shipping information, the 

Committee is unable to provide timely 

and accurate market information to the 

industry. Also, monthly reports play an 

important role in terms of order 

compliance. 

In an effort to address this problem, 

the Committee staff has provided 

additional information to handlers on 

when reports and assessments are due 

and on the importance of timely 

submission. They have also increased 

the number of reminder calls made to 

handlers when submissions are late, and 

visits have been made to delinquent 

handler facilities to collect late reports 

and payments. However, these efforts 

have not been successful in resolving 

this concern. 

In its discussion of this issue, the 

Committee agreed the current interest 

rate applied to unpaid assessments does 

not provide sufficient incentive for 

handlers to turn in monthly reports and 

their associated assessments on time. As 

it stands, the rate is low enough that 

some handlers view the interest rate as 

a cost of doing business, and only 

submit reports and assessments after 

numerous contacts from the Committee 

staff. 

Committee members wanted to find a 

solution that encourages handlers to 

submit their reports and payments as 

required. Initially, at its January 

meeting, the Committee favored 

changing the way the interest rate was 

compounded and calculated as a way to 

address the problem. However, it was 

determined that such a change could 

exceed what USDA considered 

reasonable and customary under 

marketing order programs. At its 

meeting in February, the Committee 

reviewed different scenarios imposed by 

other marketing orders to address this 

issue. Several other marketing orders 

utilize late payment charges to 

encourage compliance, and that 

authority is available under the order for 

Vidalia onions. As such, the Committee 

decided to impose a late payment 

charge, as well as increase the monthly 

interest rate. 

Committee members agreed that 

establishing a 10 percent late charge on 

late assessments helps provide some 

additional incentive for handlers to 

submit their reports and assessments on 

time. The Committee also discussed an 

appropriate grace period to set before 

the late penalty was applied. 

Recognizing the importance of the 

timely receipt of reports and payments, 

the Committee did not want to set an 

overly long grace period. The 

Committee agreed that 10 days provides 

a sufficient buffer for those who may 

mistakenly miss a due date, while still 

supporting timely reports and 

payments. 

As an added incentive to report and 

pay on time, the Committee also 

believes the monthly interest charge on 

delinquent assessments should also be 

increased. Consequently, the Committee 

unanimously recommended imposing a 

late payment charge of 10 percent on 

any assessments paid 10 days after the 

date the shipping report and 

assessments are due and increasing the 

interest rate applied to unpaid 

assessments by .5 percent to 1.5 percent 

per month. 

Final Regulatory Flexibility Analysis 

Pursuant to requirements set forth in 

the Regulatory Flexibility Act (RFA) (5 

U.S.C. 601–612), the Agricultural 

Marketing Service (AMS) has 

considered the economic impact of this 

action on small entities. Accordingly, 

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 rules issued thereunder, are 

unique in that they are brought about 

through group action of essentially 

small entities acting on their own 

behalf. 

There are approximately 50 handlers 

of Vidalia onions subject to regulation 

under the order and around 80 

producers in the designated production 

area. Small agricultural service firms are 

defined by the Small Business 

Administration (SBA) as those whose 

annual receipts are less than $7,000,000, 

and small agricultural producers are 

defined as those whose annual receipts 

are less than $750,000 (13 CFR 121.201). 

Based on National Agricultural 

Statistical Service and Committee data, 

the average annual grower price for 

fresh Vidalia onions during the 2010 

season was around $20 per 40-pound 

container, and total Vidalia onion 

shipments were around 4,503,000 40- 

pound containers. Using available data, 

more than 90 percent of Vidalia onion 

handlers have annual receipts less than 

$7,000,000. However, the average 

receipts for Vidalia producers were 

around $1,118,970 in 2010, which is 

higher than the SBA threshold for small 

producers. Assuming a normal 

distribution, the majority of handlers of 

Vidalia onions may be classified as 

small entities, while the majority of 

producers may be classified as large 

entities, according to the SBA 

definition. 

This action establishes a late payment 

charge of 10 percent on unpaid 

assessments that are 10 days past due 

and increases the interest rate applied to 

delinquent assessments from 1 percent 

to 1.5 percent per month. This change 

is expected to motivate handlers to 

submit shipping reports and 

assessments on time. This change also 

helps lower or offset the Committee’s 

compliance expenditures associated 

with delinquent reports and 

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37620 Federal Register / Vol. 76, No. 124 / Tuesday, June 28, 2011 / Rules and Regulations 

assessments. The authority for this 

action is provided in § 955.42 of the 

order. This change amends § 955.142. 

The Committee unanimously 

recommended this action at its February 

17, 2011, meeting. 

This rule does not impose any 

additional costs on handlers that are 

complying with the requirements under 

the order. This action only represents 

additional costs for handlers who are 

delinquent in submitting their reports 

and assessments. A 10 day grace period 

is also provided before the late penalty 

is applied, giving delinquent handlers 

additional time to avoid the costs 

associated with the late payment charge. 

In addition, the late charge and interest 

rate were considered reasonable by 

industry members who participated in 

the discussion of this issue. Since the 

late payment charge and interest rate are 

percentages of amounts due, the costs, 

when applicable, are proportionate and 

will not place an extra burden on small 

entities as compared to large entities. In 

addition, the industry overall benefits if 

handler reports and assessments are 

collected on time and the Committee’s 

compliance costs are reduced, 

regardless of entity size. 

The Committee discussed alternatives 

to this change, including not making a 

change to the delinquent assessment 

requirements. However, a number of 

members commented that if some 

handlers are not paying on time, a 

change was necessary. The Committee 

also considered increasing the interest 

rate accrual to daily rather than 

monthly, but this option could result in 

an interest charge that was 

disproportionately large and considered 

to be beyond the scope of what is 

reasonable and customary under 

marketing order programs. Thus, these 

alternatives were rejected. 

This action will not impose any 

additional reporting or recordkeeping 

requirements on either small or large 

Vidalia 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. As 

noted in the Initial Regulatory 

Flexibility analysis, USDA has not 

identified any relevant Federal rules 

that duplicate, overlap or conflict with 

this final rule. 

AMS is committed to complying with 

the E-Government Act, to promote the 

use of the Internet and other 

information technologies to provide 

increased opportunities for citizen 

access to Government information and 

services, and for other purposes. 

In addition, the Committee’s meeting 

was widely publicized throughout the 

Vidalia 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, 2011, meeting was a public 

meeting and all entities, both large and 

small, were able to express views on 

this issue. 

A proposed rule concerning this 

action was published in the Federal 

Register on May 13, 2011 (76 FR 27919). 

Copies of the rule were mailed or sent 

via facsimile to all Committee members 

and Vidalia onion handlers. Finally, the 

rule was made available through the 

Internet by USDA and the Office of the 

Federal Register. A 15-day comment 

period ending May 31, 2011, was 

provided to allow interested persons to 

respond to the proposal. No comments 

were received. 

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/ 

MarketingOrdersSmallBusinessGuide. 

Any questions about the compliance 

guide should be sent to Laurel May at 

the previously mentioned address in the 

FOR FURTHER INFORMATION CONTACT

section. 

After consideration of all relevant 

matter 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. 

It is further found that good cause 

exists for not postponing the effective 

date of this rule until 30 days after 

publication in the Federal Register (5 

U.S.C. 553) because handlers are already 

shipping Vidalia onions from the 2011 

crop and the Committee wants to 

implement these changes as soon as 

possible. Further, handlers are aware of 

this rule, which was recommended at a 

public meeting. Also, a 15-day comment 

period was provided for in the proposed 

rule. 

List of Subjects in 7 CFR Part 955 

Marketing agreements, Onions, 

Reporting and recordkeeping 

requirements. 

For the reasons set forth in the 

preamble, 7 CFR part 955 is amended as 

follows: 

PART 955—VIDALIA ONIONS GROWN 

IN GEORGIA 

■ 1. The authority citation for 7 CFR 

part 955 continues to read as follows: 

Authority: 7 U.S.C. 601–674. 

■ 2. Section 955.142 is amended by 

designating the first paragraph as 

paragraph (a) and the second paragraph 

as paragraph (b), and revising newly 

designated paragraph (b) to read as 

follows: 

§ 955.142 Delinquent assessments. 

* * * * * 

(b) Each handler shall pay interest of 

1.5 percent per month on any 

assessments levied pursuant to § 955.42 

and on any accrued unpaid interest 

beginning the day immediately after the 

date the monthly assessments were due, 

until the delinquent handler’s 

assessments, plus applicable interest, 

have been paid in full. In addition to the 

interest charge, the Committee shall 

impose a late payment charge on any 

handler whose assessment payment has 

not been received within 10 days of the 

due date. The late payment charge shall 

be 10 percent of the late assessments. 

Dated: June 22, 2011. 

Rayne Pegg, 

Administrator, Agricultural Marketing 

Service. 

[FR Doc. 2011–16139 Filed 6–27–11; 8:45 am] 

BILLING CODE 3410–02–P 

DEPARTMENT OF THE TREASURY 

Office of the Comptroller of the 

Currency 

12 CFR Part 3 

[Docket No. –2010–0009] 

RIN 1557–AD33 

FEDERAL RESERVE SYSTEM 

12 CFR Parts 208 and 225 

[Regulations H and Y; Docket No. R–1402] 

RIN 7100–AD62 

FEDERAL DEPOSIT INSURANCE 

CORPORATION 

12 CFR Part 325 

RIN 3064–AD58 

Risk-Based Capital Standards: 

Advanced Capital Adequacy 

Framework—Basel II; Establishment of 

a Risk-Based Capital Floor 

AGENCY: Office of the Comptroller of the 

Currency, Treasury; Board of Governors 

of the Federal Reserve System; and the 

Federal Deposit Insurance Corporation. 

ACTION: Final rule. 

SUMMARY: The Office of the Comptroller 

of the Currency (OCC), Board of 

WReier-Aviles on DSKGBLS3C1PROD with RULES