[Federal Register: June 25, 2008 (Volume 73, Number 123)]
[Rules and Regulations]
[Page 35886-35888]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr25jn08-2]
-----------------------------------------------------------------------
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 956
[Docket No. AMS-FV-07-0157; FV08-956-1 FR]
Sweet Onions Grown in the Walla Walla Valley of Southeast
Washington and Northeast Oregon; Increased Assessment Rate
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: This rule increases the assessment rate established for the
Walla Walla Sweet Onion Marketing Committee (Committee) for the 2008
and subsequent fiscal periods from $0.21 to $0.22 per 50-pound bag or
equivalent of Walla Walla sweet onions handled. The Committee locally
administers the marketing order which regulates the handling of sweet
onions grown in the Walla Walla Valley of Southeast Washington and
Northeast Oregon. Assessments upon Walla Walla sweet onion handlers are
used by the Committee to fund the reasonable and necessary expenses of
the program. The fiscal period begins January 1 and ends December 31.
The assessment rate will remain in effect indefinitely unless modified,
suspended, or terminated.
DATES: Effective Date: June 26, 2008.
FOR FURTHER INFORMATION CONTACT: Barry Broadbent or Gary Olson,
Northwest Marketing Field Office, Marketing Order Administration
Branch, Fruit and Vegetable Programs, AMS, USDA, 1220 SW Third Avenue,
Suite 385, Portland, OR 97204; Telephone: (503) 326-2724, Fax: (503)
326-7440, or E-mail: Barry.Broadbent@usda.gov or GaryD.Olson@usda.gov.
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: Jay.Guerber@usda.gov.
SUPPLEMENTARY INFORMATION: This rule is issued under Marketing
Agreement and Order No. 956, both as amended (7 CFR part 956),
regulating the handling of Walla Walla sweet onions grown in Southeast
Washington and Northeast 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 (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, Walla Walla
sweet onion handlers are subject to assessments. Funds to administer
the order are derived from such assessments. It is intended that the
assessment rate, as proposed herein, will be applicable to all
assessable Walla Walla sweet onions beginning on January 1, 2008, 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 2008 and subsequent fiscal periods from $0.21 to
$0.22 per 50-pound bag or equivalent of Walla Walla sweet onions
handled.
The Walla Walla sweet onion marketing order provides authority for
the Committee, with the approval of USDA, to formulate an annual budget
of expenses and collect assessments from
[[Page 35887]]
handlers to administer the program. The members of the Committee are
producers and handlers of Walla Walla sweet onions. 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 1998-1999 and subsequent fiscal periods, the Committee
recommended, and USDA approved, an assessment rate of $0.21 per 50-
pound bag or equivalent that would continue in effect indefinitely
unless modified, suspended, or terminated by USDA upon the basis of the
Committee's recommendation or other information available to USDA.
On December 11, 2007, the Committee met and unanimously recommended
2008 expenditures of $116,255 and a $0.01 increase in the assessment
rate from $0.21 to $0.22 per 50-pound bag or equivalent. In comparison,
the budgeted expenditures for the 2007 fiscal period were $139,210.
The increase in the assessment rate is necessary to offset the
recent decline in assessments paid by handlers. Assessment receipts
have decreased as the production levels of Walla Walla sweet onions
have dropped below historical averages--a result of lower total acreage
planted and isolated weather-related crop failures. In response to the
lower assessment income level, the Committee reduced the total budgeted
expenditures from $139,210 in 2007 to $116,255 for 2008, but still
found it necessary to increase the assessment rate to adequately fund
Committee operations.
The major expenditures recommended by the Committee for the 2008
fiscal year include $62,732 for administration, $5,000 for travel,
$44,000 for promotion, and $2,000 for compliance. Budgeted expenses for
these items in 2007 were $62,477, $5,000, $63,300, and $1,000,
respectively.
The assessment rate recommended by the Committee was derived by
dividing anticipated expenses by expected shipments of Walla Walla
sweet onions from the production area. Walla Walla sweet onion
shipments are estimated to be 510,250 50-pound bags or equivalents for
the 2008 fiscal period, which should provide $112,255 in assessment
income. The remaining difference between the anticipated Committee
expenses and the anticipated revenue from assessments is expected to
come from interest income on reserve funds ($4,000). Funds held in
reserve by the Committee (currently $144,953) are not expected to
exceed the equivalent of two fiscal periods budgeted expenditures, the
maximum permitted by the order.
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 2008 budget, and those for
subsequent fiscal periods, will be reviewed and, as appropriate,
approved by USDA.
Final 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 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.
There are approximately 42 producers of Walla Walla sweet onions in
the production area and approximately 20 handlers subject to regulation
under the marketing order. Small agricultural producers are defined by
the Small Business Administration (13 CFR 121.201)(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
$6,500,000.
The Committee estimates that in 2007, 494,918 50-pound units of
Walla Walla sweet onions were marketed at an average FOB price of
approximately $19.00 per 50-pound unit. Using that price as a basis,
the total industry value at shipping point was approximately
$9,400,000. Average receipts per handler were $470,000, which is much
less than the threshold the SBA uses to define a small service firm.
Average receipts for the 42 producers of Walla Walla sweet onions for
last year were approximately $225,000, well within the SBA definition
of small agricultural producer. Thus, it can be concluded that most, if
not all, handlers and producers of Walla Walla sweet onions may be
classified as small entities based on the definition of the SBA.
This rule increases the assessment rate established for the
Committee and collected from handlers for the 2008 and subsequent
fiscal periods from $0.21 to $0.22 per 50-pound bag or equivalent. The
Committee unanimously recommended 2008 expenditures of $116,255 and an
assessment rate of $0.22 per 50-pound bag or equivalent. The assessment
rate of $0.22 is $0.01 higher than the rate previously established in
the order. The quantity of assessable Walla Walla sweet onions for the
2008 year is estimated at 510,250 50-pound bags or equivalents. Thus,
the $0.22 rate should provide $112,255 in assessment income and, along
with $4,000 in interest income, will be adequate to meet this year's
budgeted expenses of $116,255.
The major expenditures recommended by the Committee for the 2008
year include $62,732 for administration, $5,000 for travel, $44,000 for
promotion, and $2,000 for compliance. Budgeted expenses for these items
in 2007 were $62,477, $5,000, $63,300, and $1,000, respectively.
The recent decline in assessments collected from handlers has
necessitated this assessment rate increase. Assessment income has
decreased as the production levels of Walla Walla sweet onions have
dropped below historical average levels as a result of lower total
acreage planted and isolated weather related crop failures. In response
to the lower assessment income level, the Committee reduced its total
budgeted expenditures from $139,210 in 2007 to $116,255 for 2008, but
still found it necessary to increase the assessment rate to adequately
fund Committee operations without depleting the Committee's reserve
funds.
The Committee reviewed and unanimously recommended 2008
expenditures of $116,255. Prior to
[[Page 35888]]
arriving at this budget, the Committee considered information from
various sources, including the Finance and the Promotion sub-
committees. Alternative expenditure levels were discussed at length by
all parties. The assessment rate of $0.22 per 50-pound bag or
equivalent of assessable Walla Walla sweet onions was then determined
by dividing the total recommended budget by the quantity of assessable
Walla Walla sweet onions, estimated at 510,250 50-pound units for the
2008 fiscal period. Anticipated assessment revenue is expected to be
approximately $4,000 below the budgeted expenses, which the Committee
determined to be acceptable. The Committee expects that interest income
for the year will compensate for the $4,000 deficit, but is prepared to
use reserve funds if necessary.
A review of historical information and preliminary information
pertaining to the upcoming crop year indicates that the producer price
for Walla Walla sweet onions for the 2008 season could range between
$10.00 and $12.00 per 50-pound bag or equivalent. Therefore, the
estimated assessment revenue for the 2008 crop year as a percentage of
total producer revenue could range between 1.83 and 2.20 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
are offset by the benefits derived by the operation of the marketing
order. In addition, the Committee's meeting was widely publicized
throughout the Walla Walla sweet 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 December
11, 2007, 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 Walla Walla sweet 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.
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.
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.
A proposed rule concerning this action was published in the Federal
Register on March 14, 2008 (73 FR 13798). Copies of the proposed rule
were also mailed or sent via facsimile to all Walla Walla sweet onion
handlers. Finally, the proposal was made available through the Internet
by USDA and the Office of the Federal Register. A 60-day comment period
ending May 13, 2008, was provided for 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/ AMSv1.0/
ams.fetchTemplateData.do?template=TemplateN&page=MarketingOrdersSmallBus
inessGuide. 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 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 handlers are
already receiving 2008 crop Walla Walla sweet onions from producers.
The crop year began on January 1, 2008, and the assessment rate applies
to all Walla Walla sweet onions received during the 2008 and subsequent
seasons. Also, the Committee needs funds to pay its expenses, which are
incurred on a continuing basis. Further, handlers are aware of this
rule which was recommended at a public meeting. Finally, a 60-day
comment period was provided for in the proposed rule.
List of Subjects in 7 CFR Part 956
Marketing agreements, Onions, Reporting and recordkeeping
requirements.
0
For the reasons set forth in the preamble, 7 CFR part 956 is amended as
follows:
PART 956--SWEET ONIONS GROWN IN THE WALLA WALLA VALLEY OF SOUTHEAST
WASHINGTON AND NORTHEAST OREGON
0
1. The authority citation for 7 CFR part 956 continues to read as
follows:
Authority: 7 U.S.C. 601-674.
0
2. Section 956.202 is revised to read as follows:
Sec. 956.202 Assessment rate.
On and after January 1, 2008, an assessment rate of $0.22 per 50-
pound bag or equivalent is established for Walla Walla sweet onions.
Dated: June 19, 2008.
Lloyd C. Day,
Administrator, Agricultural Marketing Service.
[FR Doc. E8-14339 Filed 6-24-08; 8:45 am]
BILLING CODE 3410-02-P