[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]


=======================================================================
-----------------------------------------------------------------------

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.

-----------------------------------------------------------------------

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