104394 Federal Register / Vol. 89, No. 246 / Monday, December 23, 2024 / Rules and Regulations 

Indian Tribal Organization (ITO) 

means: 

(1) The recognized governing body of 

any Indian tribe on a reservation; or 

(2) The tribally recognized intertribal 

organization which the recognized 

governing bodies of two or more Indian 

tribes on a reservation authorize to 

operate SNAP or a Food Distribution 

Program on their behalf. 

* * * * * 

State agency means: 

(1) The agency of State government, 

including the local offices thereof, 

which enters into an agreement with 

FNS for the distribution of USDA Foods 

on all or part of an Indian reservation, 

and 

(2) The ITO of any Indian tribe, 

determined by the Department to be 

capable of effectively administering a 

Food Distribution Program, which 

enters into an agreement with FNS for 

the distribution of USDA Foods on all 

or part of an Indian reservation. 

(3) State agencies are also referred to 

as FDPIR administering agencies. 

■ 5. § 253.5 [Corrected] 

On page 87255, in the first column, in 

amendment 39, correct the section 

heading to read as follows: 

§ 253.5 State agency requirements. 

* * * * * 

■ 6. § 253.6 [Corrected] 

■ i. On page 87255, in the second 

column, in amendment 40, correct 

paragraphs (a)(2), (d)(3)(vii); and (e)(1) 

to read as follows: 

* * * * * 

(a) * * * 

(2) Nonhousehold members. The 

following individuals residing with a 

household shall not be considered 

household members in determining the 

household’s eligibility. Nonhousehold 

members specified in paragraphs (a)(2) 

(i) and (iv) who are otherwise eligible 

may participate in the Program as 

separate households. 

* * * * * 

(d) * * * 

(3) * * * 

(vii) The earned income (as defined in 

paragraph (d)(2)(i) of this section) of 

children who are members of the 

household, who are students at least 

half time and who have not attained 

their eighteenth birthday. * * * 

* * * * * 

(e) Income deductions—(1) Earned 

income deduction. Households with 

earned income, as defined in paragraph 

(d)(2)(i) of this section, shall be allowed 

a deduction of twenty percent of their 

gross earned income. Earned income 

excluded under paragraph (d)(3) of this 

section shall not be considered earned 

income for the purpose of computing 

this deduction. 

* * * * * 

Tameka Owens, 

Acting Administrator and Assistant 

Administrator, Food and Nutrition Service. 

[FR Doc. 2024–30575 Filed 12–20–24; 8:45 am] 

BILLING CODE 3410–30–P 

DEPARTMENT OF AGRICULTURE 

Agricultural Marketing Service 

7 CFR Part 1210 

[Doc. No. AMS–SC–24–0020] 

Watermelon Research and Promotion 

Plan; Increased Assessment Rate 

AGENCY: Agricultural Marketing Service 

(AMS), Department of Agriculture 

(USDA). 

ACTION: Final rule. 

SUMMARY: This final rule implements a 

recommendation from the National 

Watermelon Promotion Board to 

increase the assessment rate from six 

cents per hundredweight to nine cents 

per hundredweight. Domestic 

watermelon producers of 10 acres or 

more and domestic first handlers of 

watermelons will each pay four and a 

half cents per hundredweight, and 

importers of 150,000 pounds or more 

annually of watermelons will pay nine 

cents per hundredweight. This final rule 

also amends current regulatory language 

to correct non-substantive and 

typographical errors. 

DATES: This rule is effective January 22, 

2025. 

FOR FURTHER INFORMATION CONTACT: 

William Hodges, Marketing Specialist, 

Mid-Atlantic Region Branch, Market 

Development Division, Specialty Crops 

Program, AMS, USDA, 1400 

Independence Avenue SW, Room 1406– 

S, STOP 0244, Washington, DC 20250– 

0244; Telephone: (443) 571–8456; or 

Email: William.Hodges2@usda.gov. 

SUPPLEMENTARY INFORMATION: This final 

rule affecting the Watermelon Research 

and Promotion Plan (7 CFR part 1210) 

(Plan) is authorized under the 

Watermelon Research and Promotion 

Act (7 U.S.C. 4901–4916) (Act). 

Executive Orders 12866, 13563, and 

14094 

USDA is issuing this 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 rule is not a 

significant regulatory action within the 

meaning of Executive Order 12866. 

Accordingly, this action has not been 

reviewed by the Office of Management 

and Budget under sec. 6 of the 

Executive order. 

Executive Order 13175 

This action was reviewed in 

accordance with the requirements of 

Executive Order 13175, Consultation 

and Coordination with Indian Tribal 

Governments, which requires agencies 

to consider whether their rulemaking 

actions will have Tribal implications. 

AMS has determined that this rule is 

unlikely to have substantial direct 

effects on one or more Indian Tribes, or 

the relationship between the Federal 

Government and Indian Tribes, or on 

the distribution of power and 

responsibilities between the Federal 

Government and Indian Tribes. 

Executive Order 12988 

This rule was reviewed under 

Executive Order 12988, Civil Justice 

Reform. It is not intended to have 

retroactive effect. The Act provides that 

it shall not affect or preempt any other 

Federal or State law authorizing 

promotion or research relating to an 

agricultural commodity. 

Under sec. 1650 of the Act (7 U.S.C. 

4909), a person may file a written 

petition with the Secretary of 

Agriculture (Secretary) if they believe 

that the Plan, any provision of the Plan, 

or any obligation imposed in connection 

with the Plan, is not in accordance with 

the law. In any petition, the person may 

request a modification of the Plan or an 

exemption from the Plan. The petitioner 

will have the opportunity for a hearing 

on the petition. Afterwards, an 

Administrative Law Judge (ALJ) will 

issue a decision. If the petitioner 

disagrees with the ALJ’s ruling, the 

petitioner has 30 days to appeal to the 

Judicial Officer, who will issue a ruling 

on behalf of the Secretary. If the 

petitioner disagrees with the Secretary’s 

ruling, the petitioner may file, within 20 

days, an appeal in the U.S. District 


khammond on DSK9W7S144PROD with RULES
Federal Register / Vol. 89, No. 246 / Monday, December 23, 2024 / Rules and Regulations 104395 

Court for the district where the 

petitioner resides or conducts business. 

Background 

Under the Plan, the National 

Watermelon Promotion Board (Board) 

administers a nationally coordinated 

program of research, development, 

advertising, and promotion designed to 

strengthen the position of watermelons 

in the marketplace, and to establish, 

maintain, and expand markets for 

watermelons. To administer the 

program, §§ 1210.328 and 1210.341 of 

the Plan authorize the Board, with the 

approval of AMS, to formulate an 

annual budget of expenses and collect 

assessments on domestic producers 

growing 10 acres or more of 

watermelons, domestic first handlers of 

watermelons, and importers of 150,000 

or more pounds of watermelons per 

year. The Board is familiar with both the 

program’s needs and the rising costs of 

research and promotion initiatives and 

is able to formulate an appropriate 

budget and assessment rate. 

This final rule increases the 

assessment rate from six to nine cents 

per hundredweight of watermelons. 

Domestic watermelon producers of 10 

acres or more and domestic first 

handlers of watermelons will each pay 

four and a half cents per 

hundredweight, and importers of 

150,000 pounds or more annually of 

watermelons will pay nine cents per 

hundredweight. The Plan specifies that 

handlers are responsible for collecting 

and submitting both the producer and 

handler assessments to the Board, 

reporting their handling of watermelons, 

and maintaining records necessary to 

verify their reporting(s). Importers are 

responsible for payment of assessments 

to the Board on watermelons imported 

into the United States through the U.S. 

Customs Service and Border Protection. 

Adjustment to the Assessment Rate 

This final rule amends § 1210.515 of 

the Plan by increasing the assessment 

rate from six cents per hundredweight 

to nine cents per hundredweight. The 

assessment on domestic watermelon 

producers of 10 acres or more and 

domestic first handlers of watermelons 

increases from three cents per 

hundredweight to four and a half cents 

per hundredweight, and the assessment 

on importers of 150,000 pounds or more 

annually of watermelons increases from 

six cents per hundredweight to nine 

cents per hundredweight. The Board 

recommended increasing the assessment 

rate to address inflation’s impact on 

buying power while maintaining 

competitiveness in the marketplace. 

The Board discussed this 

recommendation over several months at 

various State and regional watermelon 

association meetings in addition to 

presenting at a public town hall meeting 

on February 23, 2024, at the National 

Watermelon Association’s (NWA) 

annual convention. The Board sent out 

postcards to all industry contacts in 

their database to invite them to the 

NWA town hall meeting and provide 

information on the potential assessment 

increase. The Board met on February 24, 

2024, and voted unanimously to 

propose the assessment increase. Board 

members present for the vote 

represented domestic producers, first 

handlers, and importers. 

Since the Board’s inception in 1989, 

the Board only raised the assessment 

rate one other time, in 2008. From 2008 

to 2023, according to the Board, the 

United States experienced inflation of 

43.7%, which equates to 2.3% when 

compounded annually. This dollar 

devaluation translates to a loss in 

buying power of roughly 30% since the 

previous assessment increase was 

instituted. The erosion of buying power 

and continued inflationary pressure on 

funds limits the Board’s research and 

promotion activities. The raised 

assessment rate further supports the 

Board’s goal of a balanced budget 

beginning in 2025, while still allowing 

for increased research and promotion of 

watermelon across the Board’s 

communication, marketing, foodservice, 

and research committees. 

Section 1210.341 of the Plan states, in 

part, that in the case of an importer, the 

assessment shall be equal to the 

combined rate for domestic producers 

and handlers and shall be paid by the 

importer at the time of entry of the 

watermelons into the United States. 

Accordingly, with the increased 

assessment rate of nine cents per 

hundredweight, domestic watermelon 

producers of 10 acres or more and 

domestic first handlers of watermelons 

will each pay four and a half cents per 

hundredweight, and importers of 

150,000 pounds or more annually of 

watermelons will pay nine cents per 

hundredweight. This assessment 

increase is consistent with sec. 1647(f) 

of the Act (7 U.S.C. 4906(f)), that 

permits changes in the assessment rate 

through notice and comment 

procedures. Section 1210.341(b) of the 

Plan states that assessment rates shall be 

fixed by the Secretary in accordance 

with sec. 1647(f) of the Act (7 U.S.C. 

4906(f)). Further, not more than one 

assessment on a producer, handler, or 

importer may be collected on any lot of 

watermelons. Accordingly, the final rule 

revises § 1210.515(a) of the Plan to 

reflect the recommendation of the Board 

as it relates to assessments. 

Amending Regulatory Language 

The final rule also includes changes 

to § 1210.515(b) of the Plan to amend 

language and make non-substantive 

corrections to the text. These edits are 

administrative changes and will have no 

impact on the assessment rate. This 

final rule amends the misspelling of 

‘‘scheudle’’ to ‘‘schedule’’; amends 

‘‘U.S. Customs Service (USCS)’’ to ‘‘U.S. 

Customs Service and Border Protection 

(Customs)’’; amends ‘‘USCS’’ to 

‘‘Customs’’, and amends ‘‘of any other’’ 

to ‘‘or any other’’. The final rule also 

adds clarifying language and amends 

‘‘may submit the Board’’ to ‘‘may submit 

to the Board’’. 

Final Regulatory Flexibility Act and 

Paperwork Reduction Act 

Pursuant to requirements set forth in 

the Regulatory Flexibility Act (RFA) [5 

U.S.C. 601 et seq.], AMS has considered 

the economic impact of this action on 

the small producers, handlers, and 

importers that will be affected by this 

final rule. The purpose of the RFA is to 

fit regulatory action to scale on 

businesses subject to such action so that 

small businesses will not be 

disproportionately burdened. 

Domestic producers of less than 10 

acres of watermelons are exempt from 

this program. Importers of less than 

150,000 pounds of watermelons per year 

are also exempt. According to the Board, 

there are approximately 429 producers, 

121 first handlers, and 183 importers 

who are subject to the provisions of the 

Plan. 

The Small Business Administration 

(SBA) defines, in 13 CFR part 121, small 

agricultural producers of watermelons 

as those having annual receipts equal to 

or less than $3.75 million [NAICS code 

111219—Other Vegetable (except 

Potato) and Melon Farming] and small 

agricultural service firms (handlers and 

importers) as those having annual 

receipts equal to or less than $34.0 

million [NAICS code–111514— 

Postharvest Crop Activities (except 

Cotton Ginning)]. Under these 

definitions, the majority of the 

producers, handlers, and importers that 

will be affected by this final rule will be 

considered small entities. This 

conclusion is based on the following 

computations and data, using the 

Board’s assessment rate of six cents per 

hundredweight. 

For 2023, National Agricultural 

Statistics Service (NASS) reported a 

season average producer price per 

pound of $0.214. The Board estimated 

the Freight on Board (FOB) price to be 


khammond on DSK9W7S144PROD with RULES
104396 Federal Register / Vol. 89, No. 246 / Monday, December 23, 2024 / Rules and Regulations 

1https://www.watermelon.org/wp-content/ 

uploads/2020/01/Econometric-Evaluation.pdf. 

$0.284 for both importers and handlers 

in 2023. The Board reported that 2023 

assessments received from domestic 

entities totaled $2.247 million, with 

equal proportions of $1.1235 million 

coming from producers and handlers. 

Dividing $1.1235 million by half of the 

assessment rate of $0.06 per 

hundredweight, as producers and 

handlers evenly split the assessment, 

yields an estimate of total producer 

pounds assessed of 3,745.0 million 

($1.1235 million divided by $0.0003 per 

pound). Dividing the total pounds 

assessed quantity by 429 producers 

yields an average assessed pounds per 

producer estimate of 8.73 million. 

Multiplying the annual assessed pounds 

per producer estimate of 8.73 million 

pounds by the 2023 NASS season 

average producer price per pound of 

$0.214 yields an average annual 

watermelon sales receipts per producer 

estimate of $1.87 million. This is well 

below the SBA small producer size 

threshold of $3.75 million. 

With an equal proportion of annual 

domestic assessments coming from 

handlers, the total handler pounds 

assessed is also 3,745.0 million. 

Dividing total handler pounds assessed 

by 121 handlers yields an average 

assessed pounds per handler estimate of 

30.95 million pounds. Multiplying this 

estimate of annual assessed pounds per 

handler of 30.95 million pounds by the 

season average handler price per pound 

of $0.284, provided by the Board, yields 

an estimate of average annual 

watermelon sales receipts per handler of 

$8.79 million. This is well below the 

SBA small handler size threshold of 

$34.0 million. 

The Board reported that assessments 

received from importers totaled $1.196 

million in 2023. Dividing $1.196 million 

by the assessment rate of $0.06 per 

hundredweight ($0.0006 per pound) 

yields an estimate of total importer 

pounds assessed of 1,993.3 million. 

Dividing the total pounds assessed by 

the number of importers, 183, yields an 

average assessed pounds per importer 

estimate of 10.89 million. Multiplying 

this estimate of annual assessed pounds 

per importer of 10.89 million pounds by 

the season average importer price per 

pound of $0.284 yields an estimate of 

average annual watermelon sales 

receipts per importer of $3.09 million. 

This is well below the SBA small 

importer size threshold of $34.0 million. 

Assuming normal distributions, the 

majority of producers, handlers, and 

importers will be classified as small 

businesses according to SBA size 

standards. 

This final rule amends § 1210.341 of 

the Plan to mandate that domestic 

watermelon producers of 10 acres or 

more and domestic first handlers of 

watermelon each pay an assessment rate 

of four and a half cents per 

hundredweight, and importers of more 

than 150,000 pounds or more annually 

of watermelons pay an assessment of 

nine cents per hundredweight. 

Assessments under the program are 

used by the Board to finance promotion, 

research, and educational programs 

designed to increase consumer demand 

for watermelons in the United States 

and international markets. This action is 

the first time the Board has raised the 

assessment rate since 2008, and the 

second time the rate has been raised 

since the program’s inception in 1989. 

The Plan is administered by the Board 

under the USDA supervision. 

According to the Board, the increased 

assessment rate allows the Board to 

sustain and expand the promotional, 

research, and communications 

programs. The Board approved 

proposing the assessment rate increase 

at its February 24, 2024, meeting. This 

assessment increase is consistent with 

sec. 1647(f) of the Act (7 U.S.C. 4906(f)) 

that permits changes in the assessment 

rate through notice and comment 

procedures, as the proposed rule was 

open for a 30-day comment period. 

Section 1210.341(b) of the Plan states 

that assessment rates shall be fixed by 

the Secretary in accordance with sec. 

1647(f) of the Act (7 U.S.C. 4906(f)). 

Currently, § 1210.515(a) of the Plan 

states that an assessment of three cents 

per hundredweight shall be levied on all 

watermelons produced, and on all 

watermelons first handled for 

consumption as human food. It also 

states that an assessment of six cents per 

hundredweight shall be levied on 

watermelons imported into the United 

States for consumption as human food. 

Further, not more than one assessment 

on a producer, handler, or importer may 

be collected on any lot of watermelons. 

Under this final rule, § 1210.515(a) of 

the Plan is revised to increase the 

assessment rate from six cents to nine 

cents per hundredweight. The final rule 

increases the assessment rate of three 

cents per hundredweight to four and a 

half cents per hundredweight to be 

levied on all watermelons produced and 

on all watermelons first handled for 

consumption as human food in the 

United States, and increases the 

assessment rate from six cents to nine 

cents per hundredweight to be levied on 

all watermelons imported into the 

United States for ultimate consumption 

as human food. 

The Board contracted with an 

independent industry analyst to 

conduct an inflation impact analysis 

using the Consumer Price Index (CPI) 

published by the U.S. Bureau of Labor 

Statistics. The base year for the analysis 

was 2008, the year of the previous 

assessment rate increase, and the 

analysis extended through April 2023. 

The CPI was 211.080 in January 2008 

and 303.363 in April 2023. Dividing 

303.363 by 211.080 yields a ratio of 

1.437, or an increase of 43.7 percent. 

This inflation rate equates to 2.3% when 

compounded annually. Dividing the 

Board’s average annual revenue 

throughout this period of $3,024,721 by 

the CPI change ratio of 1.437 yields a 

figure of $2,104,601. This decline of 

$920,120 shows the budget’s reduced 

buying power of roughly 30 percent 

since the previous assessment increase. 

This reduction in buying power due to 

inflation has a significant impact on the 

industry’s ability to compete for market 

share. The cost of media services, 

research programs, promotional 

opportunities, as well as general 

administrative costs and fees paid to 

USDA have continually risen. USDA’s 

AMS oversight costs were budgeted at 

$105,000 in 2008, compared to $147,000 

for 2023. It is AMS policy that all 

research and promotion programs be 

charged in a fair and equitable manner. 

Assessments collected have not kept 

pace with these increasing costs across 

this time. Movement and sales of 

watermelon continue to grow, however, 

that growth has not outpaced the 

negative effects of inflation. 

Armada Corporate Intelligence 

conducted a five-year return on 

investment (ROI) study for the Board 

from 2017–2021, to determine the 

impact of Board activities on the 

demand for watermelons. The resultant 

ROI for the Board’s promotional 

endeavors is approximately 19:1, which 

displays that the activities of the Board 

have a significant positive impact on the 

watermelon industry. For further 

details, the study is located at https://

www.watermelon.org/press-releases/ 

watermelon-board-announcessignificant-positive-impact-forwatermelon-industry-with-191-roi/. 

Armada Corporate Intelligence’s 2021 

econometric analysis is aligned with 

prior economic studies developed for 

the Board, including Dr. Harry Kaiser of 

Cornell University’s 2017 analysis.1

With the increased assessment, the 

financial commitment of the US 

watermelon industry for research and 

promotion activity will increase 

approximately 50% in current dollars. 

For example, if we apply the assessment 

increase to 2023, in which collections 


khammond on DSK9W7S144PROD with RULES
Federal Register / Vol. 89, No. 246 / Monday, December 23, 2024 / Rules and Regulations 104397 

totaled $3,442,105, the increase in 

assessments collected would have been 

approximately $1,721,053. The Board 

will use the additional funds to expand 

promotion and research activities, 

maintain operating reserves, and 

address inflation’s impact on buying 

power. 

The Board estimates the adjusted 

assessment rate of nine cents per 

hundredweight will increase the cost to 

watermelon producers and handlers 

from $12 per truckload of watermelons 

to $18 per truckload of watermelons. 

Similarly, the adjusted assessment rate 

will increase the cost to watermelon 

importers from $24 a truckload to $36 

a truckload. This is based on a 40,000- 

pound net weight of watermelons per 

truckload. 

Regarding alternatives, first, the Board 

considered maintaining the current 

assessment rate of six cents per 

hundredweight. However, with no 

increase to the assessment rate, the 

Board determined many research and 

promotion programs would be reduced 

or eliminated to balance the budget. 

Consequently, the alternative of 

maintaining the current assessment rate 

was rejected. 

The second alternative considered by 

the Board was a two-cent increase to the 

assessment rate, raising the assessment 

rate from six cents per hundredweight 

to eight cents per hundredweight. This 

would allow the Board to operate with 

a balanced budget beginning in 2025, in 

addition to increasing investment in 

Board promotions. However, the Board 

decided against supporting a two-cent 

increase as inflationary pressure may 

further limit operations of the Board in 

coming years. 

The third alternative considered by 

the Board was a tiered increase of the 

assessment rate with a two-cent increase 

effective on January 1, 2025, for a rate 

of eight cents per hundredweight, and 

an additional one-cent increase effective 

on January 1, 2026, for a rate of nine 

cents per hundredweight. This option to 

spread the assessment increase over a 

prolonged period was considered, but 

the Board ultimately decided against 

this alternative to avoid confusion with 

concurrent annual assessment 

adjustments. 

This final rule also includes 

administrative changes to § 1210.515(b) 

of the Plan to correct non-substantive 

and typographical errors. These 

administrative changes have no impact 

on the assessment rate. 

This rule will not impose additional 

recordkeeping requirements on first 

handlers, producers, or importers of 

watermelons. Producers of fewer than 

10 acres of watermelon and importers of 

less than 150,000 pounds of watermelon 

annually are exempt. There are no 

Federal rules that duplicate, overlap, or 

conflict with this rule. In accordance 

with the Office of Management and 

Budget (OMB) regulation [5 CFR part 

1320] which implements the Paperwork 

Reduction Act of 1995 [44 U.S.C. 

chapter 35], the information collection 

and recordkeeping requirements that are 

imposed by the Plan have been 

approved previously under OMB 

control number 0581–0093. This rule 

will not result in a change to the 

information collection and 

recordkeeping requirements previously 

approved. 

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 or citizen access 

to Government information and 

services, and for other purposes. 

USDA determined this rule is 

consistent with the Act and would 

effectuate its purposes. 

A proposed rule concerning this 

action was published in the Federal 

Register on July 9, 2024 (89 FR 56234). 

The proposed rule was featured on the 

Board’s website, in addition to being 

distributed to all industry stakeholders 

via the Board’s Watermelon Update 

monthly newsletter. A copy of the 

proposed rule was also made available 

through the internet by AMS via https:// 

www.regulations.gov. A 30-day 

comment period ending on August 8, 

2024, was provided for interested 

parties to respond to the proposal. 

Comment Analysis 

During the proposed rule’s 30-day 

comment period, AMS received 33 

comments, which may be viewed on 

https://www.regulations.gov. Twentyfour comments received were in support 

of the changes, seven were opposed, and 

two were unrelated to the assessment 

increase or the amendment to regulatory 

language. 

Of the comments supporting the 

changes, 17 commenters stated the 

assessment increase would help 

strengthen research and promotion 

activities, with 12 of the supportive 

commenters additionally stating that the 

increased assessment rate would in turn 

benefit growers, handlers, and importers 

across the industry by raising the 

demand for watermelons through 

expanded marketing initiatives. Four of 

these commenters further acknowledged 

that the Board has a track record of 

delivering a positive ROI for the 

industry that allows the Board to 

maintain competitiveness in the 

marketplace. Four commenters provided 

generic support for the assessment 

increase. 

Of the seven comments that opposed 

the increase, four commenters voiced 

concern that the industry already faces 

enough cost increases across operations 

due to inflation with two commenters 

additionally requesting for the Board 

lower costs rather than raise them. The 

Board feels they have exhausted all costsaving measures including scaling back 

programs and liquidating reserve funds. 

Before proposing this assessment 

increase, the Board identified a loss in 

buying power of roughly 30 percent 

since the last assessment increase in 

2008, which impacts the amount and 

quality of the research and promotion 

initiatives the Board can implement. 

Therefore, a lower assessment rate 

would further reduce the activities the 

Board can afford, possibly reducing 

their ROI. 

One comment did not support the 

assessment increase and expressed 

concern of being unsure how the 

additional funds would be utilized. The 

Plan strictly dictates how the funds can 

be expended. The Board will fund 

additional promotional and research 

initiatives across the communication, 

marketing, foodservice, and research 

committees the Board aims to support 

with an increased budget. These 

specifically include activities like 

campus pop-up events to promote 

watermelon to Gen Z, expanding instore advertising experiences, 

conducting recipe contests to reach 

foodservice operators, and investing 

further into consumer research. These 

activities are outlined in the potential 

budget examples distributed by the 

Board on their website, which was also 

provided to the industry through an 

email in February 2024: https://

www.watermelon.org/wp-content/ 

uploads/2023/12/The-Case-for-the2025-NWPB-Assessment-Increase-12- 

11.pdf. 

One opposing comment from an 

international grower indicates that costs 

are too high, and that their Federal and 

State governments do not support them 

in mitigating against rising farming 

costs. The same commenter also 

indicates demand for watermelons has 

been low for years and that importers 

will be unfairly affected by the increase 

since a majority of the crop is imported 

for United States consumption. AMS 

acknowledges this comment. However, 

it is not in the Board’s purview to 

attempt to influence inflation’s effect on 

farming costs, as the Board is prohibited 

from utilizing funds to influence 

governmental policy or action as stated 

in sec. 1647(g)(3) of the Act (7 U.S.C. 

4906(g)(3)). As mentioned in the 


khammond on DSK9W7S144PROD with RULES
104398 Federal Register / Vol. 89, No. 246 / Monday, December 23, 2024 / Rules and Regulations 

proposed rule, inflation has affected 

farming and marketing costs across the 

industry which requires the Board to 

raise the assessment rate to fund 

promotional activities that maintain and 

expand the market for watermelons. 

According to the Board’s FOB and 

movement data, (which is available on 

their website: https://

www.watermelon.org/audiences/ 

industry/assessment/), the demand for 

watermelons has increased significantly 

since the last assessment increase from 

4.3 billion pounds in 2008 to 5.5 billion 

pounds in 2023. The assessment 

increase is structured so importers pay 

nine cents per hundredweight, and 

handlers and producers split the cost 

each remitting four and a half cents per 

hundredweight. This is modeled by the 

current assessment structure of the Plan 

where importers pay six cents per 

hundredweight and handlers and 

procedures each remit three cents per 

hundredweight. The assessment rate 

structure borne on the industry is 

reflective of the production of the 

commodity. Additionally, four 

importers of watermelons left 

supportive comments for the assessment 

increase during the comment period, 

with one stating that the Board’s efforts 

increase demand for watermelons in the 

United States which is evident as the 

number of watermelons imported from 

Mexico continue to grow. 

Another commenter who stated 

opposition to the changes presented in 

the proposed rule voiced concern that 

importers of watermelons may not have 

equitable opportunities to address 

questions or concerns regarding the 

increase or other Board funded 

activities. The commenter asked if 

government officials of exporter 

countries were notified of the proposed 

assessment increase. AMS 

acknowledges this comment and notes 

that the proposed rule was published in 

the Federal Register to provide notice to 

all interested parties, including 

government officials of exporting 

countries, of the proposed 

modifications. The comment period 

provided an opportunity for industry 

members and the public alike to voice 

any concerns they may have with the 

proposed changes to the Plan. As with 

other interested parties, government 

officials had notice and opportunity to 

comment on the proposed assessment 

increase. No government officials 

commented on the proposed rule. 

Additionally, prior to the publication of 

the proposed rule, the Board conducted 

outreach to industry stakeholders, 

including those representing imported 

watermelons. For example, the Board 

presented potential budgetary examples 

with the assessment increase to inform 

stakeholders, including importers, of the 

proposed assessment increase and 

activities that could be funded by the 

Board prior to the publication of the 

proposed rule. The Board presented at 

various state and regional association 

meetings, including the National 

Watermelon Association, which was 

attended by importers of watermelons, 

providing all growers equal opportunity 

to raise questions. In addition, the Board 

currently has nine importers members 

who represent the industry and help 

oversee the Board’s policies and budget. 

AMS and the Board agree that 

transparency and communication to all 

stakeholders is critical, and accordingly, 

the Board notified the industry of the 

potential assessment increase through a 

variety of channels including industrywide newsletters, regional and national 

conventions, and email correspondence. 

AMS received two non-substantive 

comments. One of the unrelated 

comments was focused on pest control, 

and another voiced support for an 

athlete sponsored by the Board. 

Accordingly, no changes were made 

to the rule as proposed, based on the 

comments received. 

After consideration of all relevant 

material presented, including the 

information and recommendations 

submitted by the Board, the comments 

received, and other available 

information, it is hereby found that this 

rule, as hereinafter set forth, is 

consistent with and will effectuate the 

purposes of the Act. 

List of Subjects in 7 CFR Part 1210 

Administrative practice and 

procedure, Advertising, Agricultural 

research, Consumer information, 

Marketing agreements, Reporting and 

recordkeeping requirements, 

Watermelons. 

For the reasons set forth in the 

preamble, the Agricultural Marketing 

Service amends part 1210, chapter XI of 

title 7 of the Code of Federal 

Regulations as follows: 

PART 1210—WATERMELON 

RESEARCH AND PROMOTION PLAN 

■ 1. The authority citation for part 1210 

continues to read as follows: 

Authority: 7 U.S.C. 4901–4916 and 7 

U.S.C. 7401. 

■ 2. Amend § 1210.515 by revising 

paragraphs (a) and (b) to read as follows: 

§ 1210.515 Levy of assessments. 

(a) An assessment of four and a half 

cents per hundredweight shall be levied 

on all watermelons produced for 

ultimate consumption as human food, 

and an assessment of four and a half 

cents per hundredweight shall be levied 

on all watermelons first handled for 

ultimate consumption as human food. 

An assessment of nine cents per 

hundredweight shall be levied on all 

watermelons imported into the United 

States for ultimate consumption as 

human food at the time of entry in the 

United States. 

(b) The import assessment shall be 

uniformly applied to imported 

watermelons that are identified by the 

numbers 0807.11.30 and 0807.11.40 in 

the Harmonized Tariff Schedule of the 

United States or any other number used 

to identify fresh watermelons for 

consumption as human food. The U.S. 

Customs Service and Border Protection 

(Customs) will collect assessments on 

such watermelons at the time of entry 

and will forward such assessment as per 

the agreement between Customs and 

USDA. Any importer or agent who is 

exempt from payment of assessments 

may submit to the Board adequate proof 

of the volume handled by such importer 

for the exemption to be granted. 

* * * * * 

Erin Morris, 

Associate Administrator, Agricultural 

Marketing Service. 

[FR Doc. 2024–30268 Filed 12–20–24; 8:45 am] 

BILLING CODE P 

CONSUMER FINANCIAL PROTECTION 

BUREAU 

12 CFR Part 1026 

Truth in Lending Act (Regulation Z) 

Adjustment to Asset-Size Exemption 

Threshold 

AGENCY: Consumer Financial Protection 

Bureau. 

ACTION: Final rule; official 

interpretation. 

SUMMARY: The Consumer Financial 

Protection Bureau (CFPB) is amending 

the official commentary to its 

Regulation Z in order to make annual 

adjustments to the asset-size thresholds 

exempting certain creditors from the 

requirement to establish an escrow 

account for a higher-priced mortgage 

loan (HPML). The exemption threshold 

for creditors and their affiliates that 

regularly extended covered transactions 

secured by first liens is adjusted to 

$2.717 billion and the exemption 

threshold for certain insured depository 

institutions and insured credit unions 

with assets of $10 billion or less is 

adjusted to $12.179 billion. 


khammond on DSK9W7S144PROD with RULES