Onions Grown in South Texas; Change in Regulatory Period

DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 959

[Docket No. FV95-959-3PR]

Onions Grown in South Texas; Change in Regulatory Period

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule with request for comments.

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

SUMMARY: This proposed rule would change the end of the regulatory

period for onions grown in South Texas under Marketing Order 959 from

June 15 to June 4 of each year. Terminating the handling regulation on

June 4 would relieve restrictions on handlers who ship late season

onions and help them become more competitive with handlers from non-

marketing order areas without diminishing South Texas marketing order

objectives. A corresponding change in the dates for the import

regulation also would be made in a second document.

DATES: Comments which are received by March 21, 1996 will be considered

prior to issuance of any final rule.

ADDRESSES: Interested persons are invited to submit written comments

concerning this action. Comments must be sent in triplicate to the

Docket Clerk, Fruit and Vegetable Division, AMS, USDA, room 2523-S,

P.O. Box 96456, Washington, DC 20090-6456, FAX 202-720-5698. All

comments should reference the docket number and the date and page

number of this issue of the Federal Register and will be made available

for public inspection in the Office of the Docket Clerk during regular

business hours.

FOR FURTHER INFORMATION CONTACT: Belinda G. Garza, Marketing Order

Administration Branch, F&V, AMS, USDA, 1313 E. Hackberry, McAllen, TX

78501; telephone: 210-682-2833; FAX 210-682-5942; or Robert F.

Matthews, Marketing Specialist, Marketing Order Administration Branch,

F&V, AMS, USDA, room 2523-S, P.O. Box 96456, Washington, DC 20090-6456;

telephone: 202-690-0464; FAX 202-720-5698.

SUPPLEMENTARY INFORMATION: This proposed rule is issued under Marketing

Agreement No. 143 and Marketing Order No. 959 (7 CFR part 959), as

amended, regulating the handling of onions grown in South Texas,

hereinafter referred to as the ``order.'' This 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 proposing this rule

in conformance with Executive Order 12866.

This proposed rule has been reviewed under Executive Order 12778,

Civil Justice Reform. This rule is not intended to have retroactive

effect. This proposed 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

[[Page 6329]]

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 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 in equity to review the

Secretary's ruling on the petition, provided a bill in equity is filed

not later than 20 days after the date of the entry of the ruling.

Pursuant to requirements set forth in the Regulatory Flexibility

Act (RFA), the Administrator of the Agricultural Marketing Service

(AMS) has considered the economic impact of this action on small

entities.

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. Thus, both statutes have small

entity orientation and compatibility.

There are 35 handlers of South Texas onions who are subject to

regulation under the marketing order and 89 producers in the regulated

area. Small agricultural service firms, which includes handlers, 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 handlers and producers of South

Texas onions may be classified as small entities.

At a public meeting on November 8, 1994, the South Texas Onion

Committee (committee) unanimously recommended, under the authority of

Sec. 959.52(c) of the order, changing the termination date of the

regulatory period for all varieties of regulated onions from June 15 to

June 4. Currently, order regulations are in effect from March 1 through

June 15 each year. The early and mid-season crop is produced in the

Lower Rio Grande Valley (District 1), which generally accounts for

about 80 percent of the total. The remaining crop, generally 20

percent, is produced in the Laredo-Winter Garden area of South Texas

(District 2). These are the last regulated shipments to leave the

production area each season.

In April 1994, based on a committee recommendation, the regulatory

period was extended from May 20 to June 15 [59 FR 17265; April 12,

1994]. At that time, the committee believed that the application of

quality control requirements over a longer time was necessary to

enhance the South Texas onion industry's market research and promotion

efforts, and protect its quality image. The committee also believed

that District 2 handlers should pay assessments on more of their

shipments for the research and promotion programs that benefit the

entire industry.

After one season's experience, District 2 growers and handlers

requested the committee to reconsider the regulatory extension.

Although assessment funds are still needed and maintaining the quality

of the shipments remains of great importance, experience appears to

indicate that the strong competition from other growing areas outweighs

these problems.

Shipments made from District 2 compete with onions produced in West

Texas and other areas of the United States not regulated under Federal

marketing orders. Onion prices are usually quite low during this period

and these unregulated areas have a competitive advantage over District

2 because inspection costs for quality control purposes and

administrative assessments are not incurred by shippers from these

areas. Ending regulations on June 4, rather than June 15, apparently

would relieve restrictions on District 2 shippers and help them become

more competitive with shippers from these production areas without

diminishing program objectives.

Section 8e provides that whenever certain specified commodities,

including onions, are regulated under a Federal marketing order,

imports of that commodity must meet the same or comparable grade, size,

quality, and maturity requirements as those in effect for the

domestically produced commodity, subject to concurrence by the United

States Trade Representative. The Act further provides that when two or

more marketing orders covering the same commodity are concurrently in

effect, imports will be subject to the requirements established for the

commodity grown in the area with which the imported commodity is in

most direct competition. Because this rule would change the regulatory

period under the South Texas onion marketing order, corresponding

changes would be needed in the onion import regulations. Such changes

are to be addressed in a separate onion import rule.

Based on available information, the Administrator of the AMS has

determined that this action would not have a significant economic

impact on a substantial number of small entities.

List of Subjects in 7 CFR Part 959

Marketing agreements, Onions, Reporting and recordkeeping

requirements.

For the reasons set forth in the preamble, 7 CFR part 959 is

proposed to be amended as follows:

PART 959--ONIONS GROWN IN SOUTH TEXAS

1. The authority citation for 7 CFR part 959 continues to read as

follows:

Authority: 7 U.S.C. 601-674.

2. In Sec. 959.322, the introductory text is revised to read as

follows:

Sec. 959.322 Handling regulation.

During the period beginning March 1 and ending June 4, no handler

shall handle any onions unless they comply with paragraphs (a) through

(d), or (e), or (f) of this section. In addition, no handler may

package or load onions on Sunday during the period March 1 through May

20.

* * * * *

Dated: February 12, 1996.

Sharon Bomer Lauritsen,

Deputy Director, Fruit and Vegetable Division.

[FR Doc. 96-3610 Filed 2-16-96; 8:45 am]

BILLING CODE 3410-02-P