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TMCNet:  Onions Grown in Certain Designated Counties in Idaho, and Malheur County, OR; Modification of Handling Regulations

[June 21, 2011]

Onions Grown in Certain Designated Counties in Idaho, and Malheur County, OR; Modification of Handling Regulations

Jun 21, 2011 (Agriculture Department Documents and Publications/ContentWorks via COMTEX) -- SUMMARY: This rule invites comments on revisions to the handling regulation for onions handled under the Idaho-Eastern Oregon onion marketing order. The marketing order regulates the handling of onions grown in designated counties in Idaho, and Malheur County, Oregon, and is administered locally by the Idaho-Eastern Oregon Onion Committee (Committee). This rule would revise the marketing order's handling regulation to allow special purpose shipments of onions for experimentation. The revision would allow the Idaho-Eastern Oregon onion industry to identify and develop new market niches and is expected to benefit producers, handlers, and consumers of onions. This proposal also announces the Agricultural Marketing Service's (AMS) intent to request a revision of the currently approved information collection requirements under the order.

EFFECTIVE DATE: Comments must be received by August 22, 2011.

ADDRESSES: Interested persons are invited to submit written comments concerning this proposal. Comments must be sent to the Docket Clerk, Marketing Order Administration Branch, Fruit and Vegetable Programs, AMS, USDA, 1400 Independence Avenue, SW., STOP 0237, Washington, DC 20250-0237; Fax: (202) 720-8938; or Internet: http://www.regulations.gov. All comments should reference the document 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, or can be viewed at: http://www.regulations.gov. All comments submitted in response to this rule will be included in the record and will be made available to the public. Please be advised that the identity of the individuals or entities submitting the comments will be made public on the Internet at the address provided above.

FOR FURTHER INFORMATION CONTACT: Barry Broadbent or Gary D. Olson, Northwest Marketing Field Office, Marketing Order Administration Branch, Fruit and Vegetable Programs, AMS, USDA, 805 SW., Broadway, Suite 930, Portland, OR 97205; 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 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 rule is issued under Marketing Agreement No. 130 and Marketing Order No. 958, both as amended (7 CFR part 958), 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 (USDA) is issuing this rule in conformance with Executive Order 12866.

This proposal 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 SEC 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 proposed rule invites comments on revisions to the handling regulation for onions handled under the order. Specifically, this rule would revise the handling regulation to allow special purpose shipments of onions for the purpose of experimentation without regard to the minimum grade, size, maturity, pack, and inspection requirements of the order. The revision would give the Idaho-Eastern Oregon onion industry the opportunity to identify and develop new markets. The changes are expected to benefit producers, handlers, and consumers of onions. This rule was unanimously recommended by the Committee at its January 20, 2011, meeting.

Sections 958.42, 958.51, 958.52, and 958.60 of the order provide authority for assessment, mandatory inspection, and establishment of grade, size, quality, maturity, and pack regulations applicable to the handling of onions. Section 958.53 of the order provides authority for the issuance of special regulations, or the modification, suspension, or termination of requirements in effect pursuant to SUBSEC 958.42, 958.52, 958.60, or any combination thereof, in order to facilitate the handling of onions for certain specified purposes.

Section 958.328 establishes minimum requirements for onions handled subject to the order. Currently, no person shall handle any lot of onions unless such onions are inspected, are at least "moderately cured", and meet the grade, size, maturity, and pack requirements of paragraphs (a), (b), and (c). Paragraph (e) delineates specific types of special purpose shipments that are exempt from the requirements of the order. Paragraph (f) outlines the safeguards for such special purpose shipments.

The Committee recommended the proposed revision to the handling regulations to respond to the industry's desire to have greater flexibility in identifying and pursuing unique marketing opportunities for onions that do not conform to the requirements of the order. The concern from the onion industry is that onion producers and handlers within the order's production area are at a competitive disadvantage, relative to other onion producing regions, with respect to their ability to identify and develop new markets for non-standard onions. Adding authority to allow experimental onion shipments under the order would give handlers access to markets not currently available to them.

An example of a scenario that would demonstrate the benefits of such a provision to the industry would be a handler's desire to produce and ship a unique, irregularly shaped small onion (i.e., a heart or a square shape) targeted for a newly developed niche market. Since irregular shape is a physical characteristic that does not conform to the order's grade requirements, such onions would ordinarily not be allowed to be handled under the marketing order. With an exemption for experimentation, however, the Committee could allow the shipment of those specific type onions while still maintaining the integrity of the order. Should the market for such onions grow to a significant size, the Committee could then incorporate changes into the handling regulations to accommodate their handling without the continued need for an exemption.

The potential for marketing opportunities like the one described above motivated the Committee to recommend modifying the handling regulation to add "experimentation" to the already established list of special purpose shipments allowed under the order. Shipments for experimental purposes would be exempt from the grade, size, maturity, pack, and inspection requirements of the handling regulation. Shipments made under the experimental exemption would continue to be subject to the assessment requirement of the order. With a special purpose shipment provision for experimentation, handlers would have greater flexibility in pursuing various types of unique marketing opportunities that are currently not available under the handling regulation.

The Committee would require handlers to request pre-approval for such experimental exemptions. Through the approval process, the Committee would be able to regulate the quantity and timing of such shipments. It is the goal of the Committee that any experimental shipments of onions would be temporary in nature. At the point that the emerging experimental market were to reach a sufficient volume or continue for such a length of time as to be deemed sustainable by the Committee, the Committee could then recommend changes to the handling regulation requirements to accommodate the marketing of such onions on a permanent basis.

Initial Regulatory Flexibility Analysis Pursuant to the requirements set forth in the Regulatory Flexibility Act (RFA), the Agricultural Marketing Service (AMS) has considered the economic impact of this action on small entities. Accordingly, AMS has prepared this initial 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 35 handlers of Idaho-Eastern Oregon onions who are subject to regulation under the order and about 250 onion producers in the regulated area. Small agricultural service firms, which include onion handlers and receivers, are defined by the Small Business Administration (13 CFR 121.201) as those having annual receipts of less than $7,000,000, and small agricultural producers are defined as those whose annual receipts are less than $750,000.

--This is a summary of a Federal Register article originally published on the page number listed below-- Proposed rule.

CFR Part: "7 CFR Part 958" Citation: "76 FR 35997" Document Number: "Doc. No. AMS-FV-11-0025; FV11-958-1 PR" Federal Register Page Number: "35997" "Proposed Rules"

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