[Federal Register Volume 59, Number 217 (Thursday, November 10, 1994)] [Unknown Section] [Page 0] From the Federal Register Online via the Government Publishing Office [www.gpo.gov] [FR Doc No: 94-27759] [[Page Unknown]] [Federal Register: November 10, 1994] _______________________________________________________________________ Part III Department of Agriculture _______________________________________________________________________ Agricultural Marketing Service _______________________________________________________________________ 7 CFR Part 956 Sweet Onions Grown in the Walla Walla Valley of Southeast Washington and Northeast Oregon; Recommended Decision; Proposed Rule DEPARTMENT OF AGRICULTURE Agricultural Marketing Service 7 CFR Part 956 [Docket No. 94AMA-FV-956-1; FV93-956-1PR] Sweet Onions Grown in the Walla Walla Valley of Southeast Washington and Northeast Oregon; Recommended Decision and Opportunity To File Written Exceptions to the Proposed Marketing Agreement and Order AGENCY: Agricultural Marketing Service, USDA. ACTION: Proposed rule. ----------------------------------------------------------------------- SUMMARY: This recommended decision proposes the issuance of a marketing agreement and order for Walla Walla Sweet Onions in southern Washington and northeast Oregon. For the purposes of this document, the term ``Walla Walla Sweet Onions'' refers to sweet onions grown in the proposed production area, which consists of designated parts of Walla Walla County, Washington, and designated parts of Umatilla County, Oregon. The proposed order and agreement would authorize production and marketing research and marketing development and promotion projects, including paid advertising, and would authorize container markings. The order would be administered by a ten-member committee consisting of six producer members, three handler members, and a public member. The order would be financed by assessments on handlers of Walla Walla Sweet Onions grown in the production area. A primary objective of this program would be to improve producer returns by strengthening consumer demand through various promotional activities and by reducing production and marketing costs through production and marketing research. Walla Walla Sweet Onion producers would vote in a referendum to determine if they favor issuance of the proposed marketing order. DATES: Comments must be received by December 12, 1994. ADDRESSES: Four copies of all comments should be sent to the Hearing Clerk, United States Department of Agriculture (USDA), Room 1079, South Building, Washington, D.C. 20250-9200. All written comments will be made available for public inspection at the Office of the Hearing Clerk during regular business hours. FOR FURTHER INFORMATION CONTACT: Gary D. Olson, Northwest Marketing Field Office, Marketing Order Administration Branch, Fruit and Vegetable Division, AMS, USDA, 1220 S.W. Third Avenue, Room 369, Portland, Oregon, 97204; telephone: (503)326-2724, FAX: (503)326-7440; or Robert F. Matthews, Marketing Order Administration Branch, Fruit and Vegetable Division, AMS, USDA, P.O. Box 96456, Room 2523-S, Washington, D.C. 20090-6456; telephone: (202)690-0464, FAX: (202)720-5698. SUPPLEMENTARY INFORMATION: Prior documents in this proceeding: Notice of Hearing, issued October 26, 1993, and published in the Federal Register on October 29, 1993 [58 FR 58105]. This administrative action is governed by the provisions of sections 556 and 557 of Title 5 of the United States Code, and is therefore excluded from the requirements of Executive Order 12866. Preliminary Statement: Notice is hereby given of the filing with the Hearing Clerk of this recommended decision with respect to a proposed marketing agreement and order regulating the handling of sweet onions grown in the Walla Walla Valley of Southeast Washington and Northeast Oregon. This notice is issued pursuant to the provisions of the Agricultural Marketing Agreement Act of 1937, as amended [7 U.S.C. 601-674], hereinafter referred to as the Act, and the applicable rules of practice and procedure governing the formulation of marketing agreements and marketing orders [7 CFR Part 900]. The proposed Federal marketing agreement and order (order) were formulated on the record of a public hearing held at the Education Service District Building in Walla Walla, Washington, on November 15, 1993. The hearing was held pursuant to the provisions of the Act. Approximately 25 witnesses, including Walla Walla Sweet Onion producers, handlers, and a Washington State University researcher, testified in support of the order. Proponents emphasized that Walla Walla Sweet Onion producers need a Federal marketing order to effectively compete with other sweet onion producing areas. No one present at the hearing testified in opposition to the proposed order. At the close of the hearing, January 15, 1994, was established as the date by which briefs, statements, and proposed corrections to the transcript were due. None were filed. The proponents testified that Walla Walla Sweet Onion producers, in order to remain competitive with other sweet onion producing areas, must conduct research and promotion programs to reduce production and marketing costs and increase sales. Such programs should include production and marketing research projects and promotion projects, including paid advertising. Testimony indicated that voluntary research and development efforts by the Walla Walla Sweet Onion industry have not been successful because of the lack of a coherent research and development plan with broad-based industry support. Also, a relatively small percentage of the U.S. onion crop is produced in the proposed production area in Walla Walla County, Washington, and Umatilla County, Oregon, and individual producers and handlers cannot implement an effective research, marketing development, and promotion program. By contrast, most other onion growing areas in the United States are large enough to convince private entities, such as seed companies, to conduct production research and developmental efforts with the result being new varieties specifically suited to those areas. Proponents believe that an industry-wide program is therefore necessary to enable the pooling of resources to address common problems. A single producer or even two or three producers cannot marshal the resources necessary to conduct effective research, marketing, and promotion programs. Small Business Consideration: In accordance with the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq.), the Administrator of the Agricultural Marketing Service considered the economic impact of this action on small entities. The record indicates that there are approximately nine handlers of Walla Walla Sweet Onions in the proposed production area and 50 producers. Small agricultural service firms have been defined by the Small Business Administration (SBA) (13 CFR 121.601) as those whose annual receipts are less than $5,000,000, and small agricultural producers as those having annual receipts of less than $500,000. The majority of the handlers and producers may be classified as small entities. During the 1992 season, commercial shipments of Walla Walla Sweet Onions totaled about 390,000 hundredweight at an average f.o.b. price of $16.60 per hundredweight for a total value of $6,474,000. An indeterminate volume, probably about 10 percent, was sold at roadside stands. While there is a great variance in the size of individual handlers' operations, the record indicates that nearly all of the handlers that would be regulated under this order would qualify as small firms under the SBA's definition. Witnesses testified that because most of the producers and handlers of Walla Walla Sweet Onions are small, they are unable to individually finance the types of research and promotion efforts needed by the industry. A marketing order program would provide a means for these small entities to pool their resources and work together to solve their common problems. Witnesses testified that such action is necessary for this relatively small industry to remain profitable in the face of intense competition from larger industries. Acreage and supplies of Walla Walla Sweet Onions have declined in recent years, and proponents believe that the order would provide a much needed means of halting the drop in grower returns experienced in past seasons. This would be achieved by strengthening demand and developing new markets for existing supplies and encouraging increased production. Also, costs could be reduced through production research. Thus, the order would be expected to have a positive impact on producer returns. The order would authorize the collection of assessments from handlers of Walla Walla Sweet Onions grown in the designated parts of Walla Walla County, Washington, and Umatilla County, Oregon. Assessment funds would be used to finance production research projects that could reduce costs by reducing the occurrence of onion diseases, controlling plant pests, and developing varieties with more desirable flavor, quality, and size. Assessment funds could also be used to strengthen demand and expand markets for Walla Walla Sweet Onions through marketing research and development, and product promotion programs, including paid advertising. Projects to develop better methods of handling, shipping or storing onions, to explore additional or alternative uses of onions, to check nutritive values, and similar research are some examples of marketing research. Examples of marketing development projects include exploring marketing possibilities, contacting buyers, distributing educational material relating to the handling and marketing of onions, and the dissemination of the results of current or past marketing research projects. The order would be administered by a committee composed of Walla Walla Sweet Onion producers, handlers, and a public member nominated by growers and handlers and selected by the Secretary of Agriculture (Secretary). Daily administration of the order would be carried out by a staff hired by the committee. The order would not regulate the production of Walla Walla Sweet Onions and would place no restriction on the quality or quantity of Walla Walla Sweet Onions that could be handled. The principal requirements of the order that would affect handlers would be the requirements that they pay assessments on fresh market shipments of Walla Walla Sweet Onions to fund research and promotion programs and that container markings would be regulated. The amount of the assessment rate is not specified in the proposed order, but witnesses at the hearing indicated that an appropriate rate might be five cents per 50-pound bag for administrative costs; research and promotion costs could require an additional five to seven cents per bag or more. Any assessment rate to cover committee expenses that may be established would be recommended by the committee to the Secretary for approval. The order would also impose some reporting and recordkeeping requirements on handlers. Handler testimony indicated that the expected burden that would be imposed with respect to these requirements would be negligible. Most of the information that would be reported to the committee is already compiled by handlers for other uses and is readily available. In compliance with Office of Management and Budget (OMB) regulations (5 CFR Part 1320) which implement the Paperwork Reduction Act of 1980 (44 U.S.C. Chapter 35) and section 3504(h) of that Act, the information collection and recordkeeping requirements that may be imposed by this order would be submitted to OMB for approval. Those requirements would not become effective prior to OMB approval. Any requirements imposed would be evaluated against the potential benefits to be derived and it is expected that any added burden resulting from increased recordkeeping would not be significant when compared to those anticipated benefits. Reporting and recordkeeping requirements issued under comparable marketing order programs impose an average annual burden on each regulated handler of about one hour with a two year record requirement. It is reasonable to expect that a comparable burden may be imposed under this order on the estimated nine handlers of Walla Walla Sweet Onions. The Act requires that prior to the issuance of an order, a referendum be conducted of affected producers to determine if they favor issuance of the order. The ballot material that will be used in conducting the referendum will be submitted to and approved by OMB prior to use. It is estimated that it would take an average of 10 minutes for each of the approximately 50 Walla Walla Sweet Onion growers to participate in the voluntary referendum balloting. Additionally, it has been estimated that it would take approximately ten minutes for each of the nine handlers to complete the marketing agreement. In determining that the order would not have a significant economic impact on a substantial number of small entities, all of the issues discussed above were considered. The order provisions have been carefully reviewed and every effort has been made to eliminate any unnecessary costs or requirements. Although the order may impose some additional costs and requirements on handlers, it is anticipated that the order would help to strengthen demand for Walla Walla Sweet Onions. Therefore, any additional costs should be offset by the benefits derived from expanded markets and sales benefitting handlers and producers alike. Accordingly, it is determined that the order would not have a significant economic impact on a substantial number of small handlers or producers. Material Issues: The material issues presented on the record of the hearing are as follows: 1. Whether the handling of Walla Walla Sweet Onions grown in the proposed production area is in the current of interstate or foreign commerce, or directly burdens, obstructs, or affects such commerce; 2. Whether the economic and marketing conditions are such that they justify a need for an order which will tend to effectuate the declared policy of the Act; 3. What the definition of the production area and the commodity to be covered by the order should be; 4. What the identity of the persons and the marketing transactions to be regulated should be; and 5. What the specific terms and provisions of the order should be, including: (a) The definition of terms used therein which are necessary and incidental to attain the declared policy and objectives of the order and the Act; (b) The establishment, composition, maintenance, procedures, powers and duties of a committee that would be the local administrative agency for assisting the Secretary in the administration of the order; (c) The authority to incur expenses and the procedure to levy assessments on handlers to obtain revenue for paying such expenses; (d) The authority to establish or provide for the establishment of production and marketing research and marketing development projects, including paid advertising; (e) The authority to establish regulations for container markings and safeguards for such regulations; (f) The establishment of requirements for handler reporting and recordkeeping; (g) The requirement of compliance with all provisions of the order and with any regulations issued under it, and (h) Miscellaneous provisions as set forth in Secs. 956.85 through 956.96 of the Notice of Hearing published in the Federal Register of October 29, 1993 [58 FR 58105] which are common to all orders, and other terms and conditions published at Secs. 956.97 through 956.99 that are common to marketing agreements only. Findings and Conclusions: The following proposed findings and conclusions on the material issues are based on the record of the hearing. 1. The record indicates that the handling of Walla Walla Sweet Onions grown in designated parts of Walla Walla County, Washington, and designated parts of Umatilla County, Oregon, is in the current of interstate or foreign commerce or directly burdens, obstructs or affects such commerce. The proposed production area is discussed in material issue 3. The record evidence shows that in July 1989, 49 percent of the commercial shipments of Walla Walla Sweet Onions were marketed in Seattle, Washington. That percentage increased over the following four years, and, in 1993, 71 percent of the volume moved to outlets inside the State, the remaining 29 percent going to both eastern and western destinations outside Washington and Oregon. An indeterminate volume of Walla Walla Sweet Onions is sold within the proposed production area at roadside stands, and some are marketed throughout the United States. A negligible percentage of the crop is processed. The record indicates that no Walla Walla Sweet Onions are currently exported, but that they may be in the future. In addition to Seattle, the record indicates that other major markets for Walla Walla Sweet Onions include Chicago, Illinois, and San Francisco, California. USDA Market News reports show that these three markets accounted for about 12 percent of commercial shipments in June, July, and August of 1992. Walla Walla Sweet Onions also were marketed (in descending order of volume marketed) in Los Angeles, California; Atlanta, Georgia; Boston, Massachusetts; New York, New York; Baltimore, Maryland; Cincinnati, Ohio; St. Louis, Missouri; Dallas, Texas; Miami, Florida; Pittsburgh, Pennsylvania; and Detroit, Michigan. Record evidence shows that any handling of Walla Walla Sweet Onions in fresh market channels, including intrastate shipments, exerts an influence on all other handling of such onions and vice versa. Therefore, because such shipments directly burden, obstruct, or affect such commerce, all handling of Walla Walla Sweet Onions grown in the proposed production area should be covered by the order, and an order for Walla Walla Sweet Onions is supported by the evidence in the record of hearing. 2. The record indicates that onions are grown in each of the 50 States, but commercial production is concentrated in a few. There are three major seasonal groups of U.S. dry onions. They include spring onions produced mainly in Georgia, Texas, and California; summer non- storage onions grown in New Mexico, Texas, and Washington; and summer storage onions produced mostly in Colorado, Idaho, Michigan, New York, Ohio, Oregon, Utah, Minnesota, Washington, and Wisconsin. The record also indicates that during its season, the Walla Walla Sweet Onion industry faces strong competition from other summer non- storage onion suppliers. Two major competitors are New Mexico, which, in 1992 accounted for 74 percent of the summer non-storage crop, and the High Plains and Trans-Pecos areas of Texas, with 17 percent of the crop. The shipping season for Walla Walla Sweet Onions runs from late June through early August each year. About 23 percent of the volume moves in June, about 40 percent in July, and the remaining 37 percent is shipped in August. As is true with other commodities, sellers of onions conduct their businesses to obtain maximum returns for the product they have for sale. Handlers and other sellers therefore continually survey all accessible markets so that they may take advantage of the best possible prices available. Further, they constantly attempt to develop demand and seek new markets for their product. Likewise, onion buyers consider prices and availability of onions from all sources in making their purchasing decisions. Frequent market news reports of onion prices are available in shipping areas, and means of rapid communication are readily available. For these reasons, onion supplies and prices in any one location are promptly known elsewhere and have a direct effect on onion supplies and prices in other locations. Summer storage onions normally account for over half the U.S. dry onion crop. About 55 percent of the 1993 dry onion crop was summer storage compared to 59 percent in 1992. The two principal types of onions grown for the summer storage crop are globe and sweet Spanish type onions. Globe onions are the dominant type grown in the midwest and east and are not generally adaptable to production in the southern States. They tend to have a strong flavor, are firm to hard to the touch, and keep well under proper storage conditions. Spanish type onions are particularly well adapted to production in the western States. They are noted for their milder, sweeter flavor, but have a more limited storage life than globes. Onions grown in the northern States are harvested primarily in July and August, and the bulk of the crop is placed in storage. Marketing of the late-summer onion crop begins shortly after harvest and continues through the fall and winter and into the spring months. Spring non-storage onions rank second in seasonal importance. Production totaled eight million hundredweight in 1993, 14 percent of the U.S. total. Spring crop onions are grown primarily in the southern States and are principally of the Grano and Granex types. These types of onions are typically sweeter and milder than the globe type. Additionally, they are more tender and perishable than either the globe or Spanish type onion. Unlike the summer storage onion crop, the spring crop is marketed relatively soon after harvest. Major producers of the spring onion crop are California, Texas, Arizona, and Georgia. Summer non-storage production reached only 4.8 million hundredweight in 1993, but this was a record crop for summer non- storage production; the 1992 crop was 4.3 million hundredweight. Testimony indicated that onions were first planted commercially in Walla Walla County, Washington, located in what is now known as the Walla Walla Valley around the year 1900. According to testimony, it was discovered that the unique growing conditions in this area of southeastern Washington and northeastern Oregon, particularly the low sulfur content of the soil, yielded a sweeter, milder onion than those grown elsewhere. In 1915, 500 carlots consisting of 300 100-pound sacks each were grown and shipped from the outskirts of Walla Walla. The record indicates that the majority of current commercial non- storage onion production in Washington is in the Walla Walla Valley. Testimony shows that separate acreage, price, and production statistics are not available for the Walla Walla Valley alone, but also include other areas in Washington, such as the Tri-cities area, the Yakima Valley, and the Columbia River Basin. The record indicates that neither the National Agricultural Statistics Service (NASS) nor State reporting services for Washington and Oregon report separate statistics for Walla Walla Sweet Onions. Such statistics are grouped together as summer-non storage onions. Witnesses testified that Walla Walla Sweet Onion acreage is included in the total for Washington non-storage onions, so that any figure representing Walla Walla Sweet Onions is necessarily an estimate. Moreover, no statistical data are available for Umatilla County, Oregon, although one witness testified that perhaps 150 to 200 acres of Walla Walla Sweet Onions may be grown. As reported by NASS, summer non-storage onions grown in Washington in 1980 totaled 780 acres, increasing until 1988 when 1,600 acres were harvested. Since then, acreage has declined to 1,000 acres in 1992. Testimony was offered that Walla Walla Sweet Onion acreage has been declining at the rate of about 100 acres per year. Moreover, although harvested acreage in Washington for 1991 was reported as 900 acres, the record indicates that the total number of acres of sweet onions harvested in the Walla Walla Valley was as little as half that, the remaining acreage being in other areas in the State. Washington summer non-storage acreage currently accounts for about .71 percent of the U.S. annual total, and an estimated 9 percent of the summer non-storage crop. Washington accounts for less than a tenth of summer non-storage onion production, however, because Washington's acreage is much less than that of competing growing areas in New Mexico and Texas. The record indicates that the average yield for the Washington summer non-storage onion crop in 1992 was about 390 hundredweight per acre. This compares with the average yield for all summer non-storage onions of 341 hundredweight per acre. Walla Walla Sweet Onion plantings begin about September 10 and end as late as October. The majority of growers attempt to have most of the crop planted by mid- to late-September. Since the growing season spans the winter months, freeze damage to Walla Walla Sweet Onions is a risk growers face each year. Harvest typically begins in the following June. Walla Walla Sweet Onions are shipped from June through August, with peak volume moving in July. Statistical data indicate that production of non-storage onions in Washington has risen in recent years, totaling 29.7 million pounds in 1991, 39.0 million pounds in 1992, and 36.0 million pounds in 1993. The record indicates that one weakness in current post harvest handling practices is storage life. Current produced varieties of Walla Walla Sweet Onions are highly perishable and cannot be stored for extended periods. Preliminary research has shown that the life of Walla Walla Sweet Onions can be extended by low temperature storage. Additionally, the identification of varieties with longer storage capability would benefit the industry. The record indicates that further extending the storage life of Walla Walla Sweet Onions has become a critical need of the industry, particularly in view of its competitive pressures. Witnesses testified that the relatively short life of Walla Walla Sweet Onions accentuates the industry's marketing risks by adding an urgency to move the produce quickly into wholesale and retail channels without regard to existing supplies and prices in those markets. The proposed order would authorize production research projects to address these problems. Season average prices for Washington summer non-storage onions decreased 31 percent to $16.60 per hundredweight in 1992. Prices reached a record high in 1991 at $23.90 per hundredweight. The 1992 crop was valued at $6.5 million, which was an 8 percent decrease from the previous season. Monthly prices generally decrease during the peak harvesting in the State of Washington. There are no separate price data available for Umatilla County. However, given the small production area, such prices from the Walla Walla Valley area of Umatilla County should be similar to those of the adjacent area of Washington. Monthly prices received for Washington summer non-storage onions decreased 9 percent from June 1992, to August, 1992 ($17.50 per hundredweight to $16.00 per hundredweight). Prices for 1991 were considerably higher, beginning at $29.40 per hundredweight and ending at $20.00 per hundredweight. The five-year average non-storage onion prices in Washington (1988-1992) for the period June through August, respectively, was $20.94, $16.94, and $14.06 per hundredweight. This compared with total U.S. five-year non-storage onion average prices of $12.22, $14.20, and $12.16 per hundredweight for the same period. U.S. summer non-storage prices in June of 1992 were 37 percent lower than Washington summer non-storage prices during that period, but prices began to even out in August of 1992 at $16.00 per hundredweight for Washington summer non-storage onions and rose 23 percent to $15.80 per hundredweight for the U.S. total for non-storage onions. According to testimony, a major share of the Walla Walla Sweet Onion market is being lost to two major competitors, South Texas onions and those from Vidalia, Georgia. Onions grown in these areas are covered by Federal marketing order programs that fund promotion and advertising activities and, therefore, help to make buyers and consumers more aware of the favorable attributes of the onions. Marketing order programs for Idaho-Eastern Oregon onions regulate the handling of onions grown on approximately 17,600 acres; the South Texas program has about 14,200 acres; and the Vidalia program covers about 8,000 acres. The industry believes that a research and promotion program is necessary to expand Walla Walla markets. Witnesses attributed the recent downward trend in Walla Walla Sweet Onion prices in part to increasing competitive pressures from other, larger onion growing areas. Testimony indicated that while the Walla Walla Sweet Onion is considered unique in its sweetness, other areas have or are developing sweet varieties of onions to capitalize on the strong consumer demand for sweet onions. For example, the South Texas onion industry has funded, through a Federal marketing order, varietal research to develop an onion variety with the desired characteristics of being mild tasting and sweet. This variety, called the Texas Grano 1015 Y, has been actively promoted. The record indicates that the South Texas onion industry budgeted funds for research and market development activities through its marketing order. Additionally, handlers in Idaho and Eastern Oregon, also under a Federal marketing order program, budgeted funds during the same period for promotion and research of its sweet Spanish onion. Witnesses attributed the success these other growing areas have had to their ability to pool available resources under their respective marketing orders. Proponents testified that the research and promotion activities conducted by competitors have assisted those competing industries in developing and promoting sweeter onion varieties that are challenging the Walla Walla Sweet Onion for its share of the onion market. It is believed that a similar program is necessary for Walla Walla Sweet Onions to remain profitable in this competitive industry. The record indicates that most Northwest residents are familiar with the taste and origin of the Walla Walla Sweet Onion. The record also indicates that they are aware of its unique flavor characteristics and are loyal customers. However, as the Walla Walla industry has grown, the development of new markets has become necessary. Testimony demonstrated the need to differentiate the Walla Walla Sweet Onion from other onions available in the marketplace to garner customer loyalty in markets located outside Washington and Oregon. The record indicates that most Walla Walla Sweet Onion growers and handlers are not sufficiently large to finance promotion and research programs on an individual basis. In addition, public funds to finance such projects are scarce. Heretofore, the Walla Walla Sweet Onion industry has attempted to operate and fund research and development projects under voluntary programs. Eventually, these programs ceased to operate because of inadequate support and financing. Witness testimony unanimously supported a marketing order program to be financed by all handlers, to strengthen consumer demand through promotion of the commodity and reducing costs through production research. Witnesses also testified that market research, in the form of data collection and analysis, would be an essential part of an overall marketing and promotion strategy. Currently, limited data is gathered with respect to Walla Walla Sweet Onions. To effectively promote and market Walla Walla Sweet Onions, proponents testified that additional knowledge of market conditions and access to complete data is necessary to make prudent decisions for focusing promotional efforts and promoting the efficient allocation of resources. The record indicates that many onions sold as Walla Walla Sweet Onions do not have the same mild flavor and other characteristics of Walla Walla Sweet Onions grown in the proposed production area. Several witnesses testified that often such onions were identified as Walla Walla Sweet Onions grown in other states or areas near the Walla Walla Valley. Testimony indicates that the growers of the Walla Walla Valley have spent time and effort attempting to market the Walla Walla Sweet Onion as one they believe has unique characteristics because of the area in which the onions are grown. These growers believe that such efforts have been offset by growers and handlers selling onions produced outside the proposed production area as Walla Walla Sweet Onions. Testimony indicated that 40 percent of the onions sold and described as Walla Walla Sweet Onions were grown outside the proposed production area and, therefore, were not true Walla Walla Sweet Onions. In summary, a number of problems were identified in the record that could be resolved through a marketing order that would enable the Walla Walla industry to work together collectively. Identifying varieties that have good seedling survival rate, a low susceptibility to cold damage, good eating quality, and increased storage capability would add stability to the supply and quality of the Walla Walla Sweet Onion crop, and could increase yields and reduce costs. The marketing order program could assist handlers in solving mutual post harvest handling problems, in the interest of increasing the quality of their offerings, reducing costs and increasing returns. Finally, authorizing industry financing of promotion and advertising programs would enable the industry to increase consumer awareness of its unique commodity, strengthen demand and increase sales. In view of the foregoing, it is concluded that there is a need for a marketing order for Walla Walla Sweet Onions grown in designated parts of Washington and Oregon. The order would meet many of the needs of the industry and would tend to effectuate the declared policy of the Act. 3. A definition of the term ``production area'' should be included in the order to delineate the area in which Walla Walla Sweet Onions must be grown before the handling thereof is subject to the marketing order. Such term should include designated parts of Walla Walla County, Washington, and Umatilla County, Oregon. The area defined in the proposed order comprises what is generally recognized as the Walla Walla Valley of Washington and Oregon. The counties included are contiguous and share essentially the same growing, harvesting and marketing conditions with respect to Walla Walla Sweet Onions. While production of Walla Walla Sweet Onions is currently concentrated in the two counties of Walla Walla and Umatilla, onions of all types are grown throughout the proposed production area, as well as adjacent areas. At the hearing, a witness proposed revising the definition of production area appearing in the Notice of Hearing to include an area north of the Touchet River in Washington. However, testimony indicated that this area is dry land of a different soil type. Further, it does not have a history of Walla Walla Sweet Onion production, so that onions produced there may not have the same quality attributes as others from the proposed production area. The area as defined accounts for much of the current sweet onion acreage in Washington and Oregon and, according to record evidence, is generally recognized by the onion trade and consumers as comprising the Walla Walla Sweet Onion region of Washington and Oregon. This is because of the unique soil and growing conditions in the highly localized area. Furthermore, the production area as defined in the marketing order is the smallest practicable geographic area to which the order should be applied, consistent with carrying out the declared policy of the Act. The term ``Walla Walla Sweet Onion'' should be defined to specify the commodity covered by the proposed order and to which the terms and provisions of the marketing order would be applicable. The record indicates that a ``Walla Walla Sweet Onion'' may be any of a number of onion varieties grown in the production area, rather than one specific variety of onion. However, testimony indicated that onions acquire special characteristics when grown in the proposed production area. This is due in part to the low sulfur content of the soil. Further, according to testimony, the term ``Walla Walla Sweet Onion'' has a specific meaning in the onion trade, and consumers perceive Walla Walla Sweet Onions as a unique commodity distinct from other onions. For these reasons, the term ``Walla Walla Sweet Onion'' should be defined to mean all varieties of the genus and species Allium cepa, except sweet Spanish types, grown in the proposed production area. To provide for the possibility that other types of onions that have characteristics similar to what is now known as the ``Walla Walla Sweet Onion'' may be grown in the production area in the future, the committee should be authorized, upon approval of the Secretary, to add those types of onions to the types included under the term ``Walla Walla Sweet Onion.'' This would be accomplished through informal rulemaking procedures. The definition should include dry onions, onions grown for transplanting, and salad onions. The definition in the order as originally proposed also included onion seed. However, testimony indicated that regulating seed was not necessary, as the intent of the proponents is to define Walla Walla Sweet Onions as only those sweet onions grown in the production area. Accordingly, if onions are grown outside the proposed production area from seed produced within that area, the resulting onions would not be true Walla Walla Sweet Onions. Testimony indicated that this is because of the soil and climate unique to the Walla Walla River Valley, comprising designated parts of Walla Walla County, Washington, and Umatilla County, Oregon. Accordingly, the term ``seeds'' should not be included in the proposed definition of Walla Walla Sweet Onions. 4. The term ``handler'' is synonymous with the term ``shipper'' and should be defined to identify the persons who would be subject to regulation under the order. Such term should apply to any person, except a common or contract carrier transporting Walla Walla Sweet Onions owned by another person, who first performs any of the activities within the scope of the term ``handle'' as hereinafter defined. The definition identifies persons who would be responsible for meeting the requirements of the order, including paying assessments and submitting reports. Common or contract carriers transporting Walla Walla Sweet Onions owned by another person would not be considered as handlers, even though they transport Walla Walla Sweet Onions, because such carriers do not have control over the Walla Walla Sweet Onions being transported. Nor are they the persons who cause the introduction of such Walla Walla Sweet Onions into the stream of commerce. The only interest of a common or contract carrier in such Walla Walla Sweet Onions is to transport them for a service charge to destinations determined by others. Growers who handle their own Walla Walla Sweet Onions or Walla Walla Sweet Onions grown by others would be considered handlers under the order. Any person who purchases Walla Walla Sweet Onions from growers and performs any other handling function such as grading and packing such Walla Walla Sweet Onions would be a handler. The term ``handle'' should be defined in the order to establish the specific functions that would place Walla Walla Sweet Onions in the current of commerce within the production area or between the production area and any point outside thereof, and to provide a basis for determining which functions are subject to regulation under authority of the marketing order. ``Handle'' and ``ship'' are used synonymously and the definition should so indicate. The record indicates that the term ``handle'' should include the acts of packaging, loading, transporting or selling Walla Walla Sweet Onions. However, the term ``handle'' should not include the transportation, sale or delivery of field-run Walla Walla Sweet Onions to a handler within the production area or to a handler outside the production area but within Walla Walla County, Washington, or Umatilla County, Oregon, to have such onions prepared for market. In this case, the onions have not yet been prepared for market nor are they in their existing condition being transported to market. Most sellers and buyers do not consider them as yet suitable or appropriate for commercial transactions and, as such, they have not yet entered the stream of commerce. Walla Walla Sweet Onion producers sometimes market their Walla Walla Sweet Onions themselves. In such cases, those growers would be the first handlers of Walla Walla Sweet Onions and would be responsible for paying assessments and complying with other order requirements. 5.(a) Certain terms should be defined for the purpose of designating specifically their applicability and limitations whenever they are used in the order. The definition of terms discussed below is necessary and incidental to attain the declared policy and objectives of the order and Act. ``Secretary'' should be defined to mean the Secretary of Agriculture of the United States, or any officer, or employee of the United States Department of Agriculture who has been or who may be delegated the authority to act for the Secretary. ``Act'' should be defined to mean the Agricultural Marketing Agreement Act of 1937, as amended (7 U.S.C. 601-674). This is the statute under which the proposed regulatory program would be operative, and this definition avoids the need to refer to the citation throughout the order. ``Person'' should be defined to mean an individual, partnership, corporation, association, or any other business unit. This definition is the same as that contained in the Act and insures that it has the same meaning in the order as it has in the Act. The term ``registered handler'' should be defined to mean a person who is a handler with adequate facilities for procuring and sorting, grading, packaging, and performing any other handling function or who is a handler with access to such facilities. This provision would require all Walla Walla Sweet Onion handlers to register with the committee after meeting certain qualifications. Some handlers may have grading and storage facilities outside of the production area. Handler registration would aid the committee in determining compliance with order requirements. Registration also would enable the committee to obtain the necessary information to levy assessments. No testimony was presented concerning the actual method of registration. However, based on similar orders using handler registration the committee should be authorized to recommend, for approval of the Secretary, procedures with respect to handler registration. This provision has been added to the definition of registered handler. The term ``container'' should be defined as a box, bag, crate, hamper, basket, package, or any other receptacle used in packaging, transporting, sales, shipment, or other handling of Walla Walla Sweet Onions. It is necessary to define the term since it may be used throughout the proposed order and any rules established thereunder. The term ``producer'' should be synonymous with ``grower'' and should be defined to identify those persons who are eligible to vote for, and serve as, producer members and alternate producer members on the committee and those who may vote in any referendum. The term should mean any person engaged in a proprietary capacity in the production of Walla Walla Sweet Onions for market within the production area. Each business unit (such as a corporation or partnership) should be considered a single producer and should have a single vote in nomination proceedings and referenda. The term ``producer'' should include any person who owns or shares in the ownership of Walla Walla Sweet Onions such as a landowner landlord, tenant, or sharecropper. A person who owns and farms land resulting in that person's ownership of the Walla Walla Sweet Onions produced on such land should be considered a producer. The same is true with respect to a person who rents and farms land resulting in that person's ownership of all or part of the Walla Walla Sweet Onions produced on that land. Likewise, any person who owns land which that person does not farm, but as rental for such land obtains the ownership of a portion of the Walla Walla Sweet Onions produced thereon, should be regarded as a producer for that portion of the Walla Walla Sweet Onions received as rent. The tenant on such land should be regarded as a producer for the remaining portion produced on such land. A joint venture is one whereby several persons contribute resources to a single endeavor to produce and market a Walla Walla Sweet Onion crop. In such venture, one party may be the farmer who contributes one or more factors such as labor, time, production facilities or cultural skills, and the other party may be a handler who contributes money and cultural, harvesting, and marketing supervision. Normally, a husband and wife operation would be considered a partnership. Any individual, partnership, family enterprise, organization, estate, or other business unit currently engaged in the production of Walla Walla Sweet Onions for market would be considered a producer under the order, and would be entitled to vote in referenda and committee nominations. Each party would have to have title to at least part of the crop produced, electing its disposition, and receiving the proceeds therefrom. This control could come from owning and farming land producing Walla Walla Sweet Onions, payment for farming services performed, or a landlord's share of the crop for the use of the producing land. A landlord who only receives cash for the land would not be eligible to vote. A business unit would be able to cast only one vote regardless of the number and locations of its farms, but each separate legal entity would be entitled to vote. A number of producers in the production area own or operate packing sheds. A producer who owns or operates a packing shed should not be precluded from qualifying as a producer under the order. The term ``Varieties'' should mean all classifications, subdivisions, or types of Walla Walla Sweet Onions that are commonly recognized by the trade and officially recognized by the U.S. Department of Agriculture or recommended by the committee and approved by the Secretary. Testimony indicated that only Walla Walla Sweet Onions or subdivisions or varieties thereof would be subject to any regulations issued pursuant to the proposed order, and that varieties of onions grown in the production area not possessing characteristics of Walla Walla Sweet Onions would not be included. Varieties not included would include hybrid varieties of the sweet Spanish storage type onion. The term ``Committee'' should be defined to mean the administrative agency known as the Walla Walla Sweet Onion Committee established under the provisions of the order. Such a committee is authorized by the Act, and this definition is merely to avoid the necessity of repeating the full name each time it is used. The term ``fiscal period'' should be defined to mean the annual period for which the committee would plan the use of its funds. This period should be established to allow sufficient time prior to the time Walla Walla Sweet Onions are first shipped for the committee to organize and develop its budget for the ensuing season. However, it should also be set to minimize the incurring of expenses during a fiscal period prior to the time assessment income is available to defray such expenses. The Notice of Hearing proposed that ``fiscal period'' mean the 12- month period beginning June 1 and ending the following May 31. Record evidence indicates that the harvesting and marketing cycle for Walla Walla Sweet Onions grown in the production area begins in June and ends in August. The fiscal period should coincide with the Walla Walla Sweet Onion crop year, because the industry typically plans its operation on this basis. Hearing testimony supported the fiscal period being established for a 12-month period beginning June 1 and ending May 31 of the next year. However, based on future experience, it may be desirable to establish a fiscal period other than one ending on May 31. Thus, authority should be included in the order to provide for the establishment of a different fiscal period if recommended by the committee and approved by the Secretary through informal rulemaking procedures. In any event, the beginning date of any new fiscal period should be sufficiently in advance of the harvesting season to permit the committee to formulate its marketing policy and perform other administrative functions. Also, it should be recognized that if at some future date there is a change in the fiscal period, such change would result in a transition period. (b) Pursuant to the Act, it is desirable to establish an agency to administer the order locally as an aid to the Secretary in carrying out the declared policy of the Act and to provide for effective and efficient operation of the order. As proposed in Sec. 956.20, the Walla Walla Sweet Onion Committee should therefore be established and consist of ten members, including one public member. The record indicates that a committee composed of ten members, with a like number of alternates, would provide adequate representation and would provide for reasonable judgment and deliberation with respect to recommendations made to the Secretary, and in the discharge of other committee duties. Since the order is intended to primarily benefit Walla Walla Sweet Onion producers, it is appropriate that the committee be comprised primarily of growers. Six of the ten committee members should therefore be Walla Walla Sweet Onion growers. Since the program would be financed by handlers, and handlers would be responsible for complying with the terms of the marketing order, however, it would be reasonable to provide for handler representation on the committee as well. For this reason, proponents proposed that, of the ten members on the committee, three of those members should be handlers. The record indicates that producer members and their alternates should be selected from the production area at large. Since the production area is relatively small, this method should be adequate to ensure equitable representation on the committee. The record indicates that Walla Walla Sweet Onion production is currently located in Walla Walla County in Washington, and Umatilla County in Oregon, which together account for all of the production. Hearing testimony indicated that the six persons selected to serve as grower members or alternates should be individuals who are producers, or officers or employees of producers. Persons selected to serve as handlers should be engaged in handling Walla Walla Sweet Onions. Such persons could be expected to have strong interests in the effects of committee decisions of Walla Walla Sweet Onion producers and handlers. To help ensure that the committee will not have a membership with partiality toward a single handling entity, the proposal also contains a provision that, at the time of selection, no more than two producer members may be affiliated with the same handler. Testimony indicates that a producer member should have at least three years experience in the production of Walla Walla Sweet Onions. The proponents believe that because committee membership is a heavy responsibility requiring a high degree of individual initiative for what is done and how it is done, and cultural practices for Walla Walla Sweet Onions are diverse, it would take three years of experience producing Walla Walla Sweet Onions in order to become knowledgeable about the industry. At the hearing, witnesses supported adding a public member to the committee. While the influence of consumers would be implicitly present in the deliberations of the producer and handler committee members, and all meetings would be public, the appointment of a public member would offer many advantages. One would be direct communication between industry members and the public member, who would have no connection with the industry and whose opinions would afford the industry an opportunity to discuss its problems and concerns with someone who would view these problems and concerns from outside the Walla Walla Sweet Onion industry. The public representative and that person's alternate should not be permitted to have a direct financial interest in the production, processing, financing, buying, packing, or marketing of Walla Walla Sweet Onions except as a consumer, nor be a director, officer, or employee of any firm so engaged. Such public representatives should be able to devote sufficient time and express a willingness to attend committee activities regularly and to familiarize themselves with the background and economics of the industry. Proposed Sec. 956.25 states that each member of the committee, including the public member, should have an alternate. This would ensure that all portions of the production area are adequately represented in the conduct of the committee's business and that the continuity of operation is not interrupted. The order should provide that alternate members should meet the same qualifications as their respective members, except for tenure and growing experience. They would act in the place and stead of their respective members during temporary absences. In the case of the death, removal, resignation, or disqualification of a member, the alternate should serve as member until a new member is selected and has qualified. Proposed Sec. 956.21 states that, with the exception of initial members, the term of office of committee members and their respective alternates should be for three years and should begin on June 1 and end on May 31, or for such other three year period as the committee may recommend and the Secretary approve. The record indicates that the term of office should begin on June 1 because that is considered the beginning of the Walla Walla Sweet Onion crop year. The Walla Walla Sweet Onion shipping season generally ends in August and work begins again in September when growers begin seeding for the next year's crop. At that point in time, it can be determined which growers have remained in business and qualify to serve on the committee. A three-year term would be appropriate because it would give members sufficient time to become familiar with committee operations and enable them to make meaningful contributions at committee meetings. Furthermore, a three-year term would enable establishment of a rotation so that approximately one-third of the committee membership would terminate each year. Staggered terms would lend continuity to the committee by insuring that some experienced members would be on the committee at all times. Therefore, the order should provide that the terms shall be determined so that approximately one-third of the total committee membership terminates each year. The Notice of Hearing proposed that the term of office for initial members and alternates should be established so that one-third of the initial producer and handler members and alternates would serve for a one-year term, one-third would serve for a two-year term, and one-third would serve for a three-year term. Since there would be only one public member, there is no need to provide for staggering that membership; the initial public member should serve a three-year term of office. The effective date of the order, if issued, may not coincide with the specified beginning date of the terms of office of committee members and alternates. Therefore, a provision is necessary to adjust the initial terms of office. To accomplish this, the order should provide that the terms of office of the initial members and alternates shall begin as soon as possible after the effective date of the order. In the event that the initial members are selected prior to June 1, 1995, an example of how the initial terms of office could be adjusted is as follows: the initial one-year term would not end on May 31, 1995, but would continue until May 31, 1996. Similarly, the two-year and three-year terms would end on May 31, 1997, and 1998, respectively. For the purposes of applying the tenure requirements of the proposed order, each of these initial terms would be considered as a one-year, a two- year, or a three-year term even though the actual period of the appointment may be several months longer. To prevent unnecessary vacancies from occurring on the committee, the order should provide that members and alternates shall serve in such capacity for the term of office, or portion thereof, for which they are selected and have qualified, and until their respective successors are selected. However, so that there is a continual turnover in membership and infusion of new ideas, the order should provide that no member, including the public member, may serve more than two consecutive terms on the committee unless specifically exempted by the Secretary. After serving two consecutive terms, a committee member should be eligible to serve as an alternate, but should be ineligible to serve as a member for a period of one year. These tenure requirements should not apply to alternate members. Testimony indicates that there should be no tenure restriction on alternate members. The proponents believe that establishing a maximum of two three-year terms for alternate members would serve no useful purpose, but potentially could limit the pool of candidates for full committee membership. Testimony also indicates that producers with less than three years experience growing Walla Walla Sweet Onions should be eligible for appointment to the committee as alternate members. To guard against the possibility of a position remaining vacant because of a lack of eligible nominees or persons eligible to serve, the Secretary should have the authority to except an individual from tenure limitation. Such an exception would be made in special and unusual circumstances. Limiting the tenure of committee membership as proposed would be in accordance with the Secretary's ``Guidelines for Fruit, Vegetable, and Specialty Crop Marketing Orders.'' The order should provide that the Secretary shall have the authority to select members and alternates of the committee, but the Walla Walla Sweet Onion growers and handlers should have the responsibility for recommending nominees to the Secretary for selection under proposed Sec. 956.22. The nomination procedure outlined in the order would provide a means of making available to the Secretary the names of prospective members and alternates desired by the industry to serve on the committee. The record does not indicate how the initial committee should be nominated, but an often used method in such instances is for the Secretary to conduct a meeting to nominate initial industry committee members. All producers of record in the production area should receive notice of the meeting in sufficient time to enable them to attend. Nominations should be received and voted upon at these meetings. Those persons receiving the highest number of votes for each of the positions to be filled should be considered the nominee for that position. Handler nominations should be accomplished in the same way. The committee should be responsible for conducting subsequent nomination meetings, and providing notice to Walla Walla Sweet Onion producers and handlers of those meetings. The proposal in the Notice also provided that at least one nominee be submitted for each position for the Secretary's consideration. Proposed Sec. 956.22 provides that one nominee be designated for each member and alternate member position that is vacant or is about to become vacant. However, the Secretary would reserve the right to select any qualified candidate willing to serve. Testimony indicates that it would be desirable to hold nomination meetings in conjunction with other industry meetings, such as a shipper's association, grower's association, or Extension Service meetings. Such a procedure would encourage higher attendance at the meetings. Meetings held for nominating members and alternates of subsequent committees should be held no later than April 1 of each year or such other date as the committee may recommend and the Secretary may approve. Inasmuch as the term of office would begin June 1 of each year, nomination meetings should be held in sufficient time to assure that appointments may be made prior to the beginning of each new term of office. Nominations should be submitted in such manner and form as the Secretary may prescribe. One nominee should be designated for each position that is to be filled the following June 1. Sufficient information about each nominee should be provided so the Secretary can determine if such person is qualified for the position for which nominated. Only Walla Walla Sweet Onion producers should participate in designating nominees for producer members and alternates. Only Walla Walla Sweet Onion handlers would be entitled to vote for handler members. If a person both produces and handles Walla Walla Sweet Onions, such person may vote either as a producer or a handler, but not both. Each eligible person should be allowed to cast only one vote in the nomination process for each member and alternate member position that is to be filled. Provisions also should be made for the nomination and selection of a public member and alternate. The record indicates that nominees for the public member and alternate should be selected by the industry members of the committee every three years at the first meeting following the selection of the current committee. The names of the nominees would then be forwarded to the Secretary for selection. The order should provide that the members of the committee should be selected by the Secretary from persons nominated or from among other qualified persons, in accordance with proposed Sec. 956.23. In the event nominations are not made within the time and in the manner specified in the order, the Secretary may select members and alternates without regard to nominations, in accordance with proposed Sec. 956.27. Such selection should be from qualified persons as provided in the order. Each person to be selected by the Secretary as a member or as an alternate member of the committee should, prior to selection, qualify by advising the Secretary that such person agrees to serve in the position for which nominated. Proposed Sec. 956.26 states that the order should provide a method for promptly filling any vacancies on the committee for unexpired terms of office. There may be vacancies caused by the death, removal, resignation, or disqualification of a member or alternate. The order should provide that the Secretary should name a successor to fill an unexpired term from nominations made in the same manner as provided for nominating all other members and alternates. Any nomination meetings for filling vacancies should be held within a reasonable amount of time after a vacancy occurs. In order to avoid holding meetings and electing nominees when other nominees acceptable to the Walla Walla Sweet Onion industry are before the Secretary, the selection of members from nominees previously submitted but not selected should be permitted. This would allow, for example, the Secretary to appoint a person who received the second highest number of votes at the last nomination meeting for the position that has become vacant. As set forth in proposed Sec. 956.28, the order should specify a procedure for the committee to conduct its meetings. It should provide that a majority of all members of the committee is necessary to constitute a quorum and to pass any motion or approve any committee action. However, any action made pursuant to proposed Sec. 956.61 pertaining to recommendations for regulations, would require seven concurring votes. Accordingly, six members of the ten-member committee must be present in order to constitute a quorum and enable the committee to conduct a meeting. At least six affirmative votes should be required to pass any motion or approve any committee action, except when dealing with recommendations for regulations, which would require at least seven. The evidence of record is that at least seven committee members should be required to concur on any recommendations pertaining to the imposition of container marking requirements because more is needed to protect minority interests while at the same time allowing majority rule. A simple majority would be sufficient for recommendations on other activities authorized under the marketing order, i.e., recommendations on production and marketing research and marketing development and promotion projects, including paid advertising, and the financing of these activities through handler assessments and voluntary contributions. There may be times when it will be impossible to assemble the committee promptly to meet an emergency situation. Therefore, the order also should enable committee members, and alternates when acting as members, to vote by mail, telegraph, telephone, facsimile, or other means of communication, provided that any vote cast orally be confirmed promptly in writing. If an assembled meeting is held, all votes should be cast in person, to ensure that the person voting on a motion or committee action hears both sides of the question before taking such action. The majority, quorum, and voting requirements should still apply when voting by mail, telegraph, telephone, facsimile, or other means of communication. Committee members and alternates will necessarily incur some expense while on committee business. Reasonable expenses, which may include travel, meals and lodging, should be reimbursed to members while attending committee meetings or performing other duties under the order, in accordance with proposed Sec. 956.29. Therefore, the order should provide that members, and alternates when serving as members of the committee, should serve without compensation but shall be reimbursed for such expenses authorized by the committee and necessarily incurred by them in attending committee meetings and in the performance of their duties under the order. Testimony indicates that it should be at the discretion of the committee to pay expenses of alternate members who are requested to attend meetings regardless of whether their respective members are present. The committee, under proposed Sec. 956.30, should be given those specific powers that are set forth in section 608c(7)(C) of the Act. Such powers are granted by the enabling statutory authority and are necessary for an administrative agency, such as the Walla Walla Sweet Onion Committee, to carry out its proper functions. It would be necessary for the committee to adopt rules and regulations, prescribe the terms on which applications or information is to be filed, and to set up procedural rules to administer this part. The committee also should have the power to investigate complaints of violations to the order and forward such information to the Secretary, and to recommend to the Secretary appropriate amendments to this part. The committee's duties as set forth in Sec. 956.31 of the proposed order are necessary for the discharge of its responsibilities. These duties are similar to those typically specified for administrative agencies under other programs of this nature. They pertain to specific activities authorized under the order, such as investigating and compiling information regarding Walla Walla Sweet Onion marketing conditions, and to the general operation of the order including hiring employees, appointing officers, and keeping records of all committee transactions. It is proposed that the marketing order delineate committee duties as follows: (1) At the beginning of each fiscal period, or as soon thereafter as practicable, the committee should hold an organizational meeting at which a chairman and such other officers as may be necessary would be selected, any necessary subcommittees should be appointed, and such rules and regulations for the conduct of business should be adopted as may be advisable. (2) The committee should act as intermediary between the Secretary and producers and handlers of Walla Walla Sweet Onions. (3) Any available information requested by the Secretary should be furnished by the committee. (4) The committee should appoint such employees, agents, and representatives as it may deem necessary, and determine salaries, benefits, and duties for each such persons. (5) At such times as may be necessary, the committee should investigate and assemble data on the growing, harvesting, shipping, and marketing conditions of Walla Walla Sweet Onions. Furthermore, upon approval of the Secretary, the committee should engage in research and service activities that relate to the production, handling, or marketing of Walla Walla Sweet Onions. (6) The committee should keep minutes, books, and records which clearly reflect all of its acts and transactions. These minutes, books, and records would be subject to examination at any time by the Secretary or an authorized agent or representative of the Secretary. (7) The committee should ensure that its voting record on recommended regulations and other matters are available to producers and handlers. (8) Prior to the beginning of each fiscal period, the committee should submit to the Secretary a budget of its proposed expenses for such fiscal period along with a recommendation for the assessment rate for such period. (9) The committee should have its books audited by a competent independent accountant at least once each fiscal period, and at such other times as the committee may find necessary or as the Secretary may request. The audit report should show the receipt and expenditures of funds collected pursuant to this part. A copy of this report should be made available to the Secretary, as well as at the principal office of the committee for inspection by handlers and producers. Confidential or proprietary information should be removed from the audit report before making it available to handlers and producers. (10) The committee should have the duty of consulting, cooperating, and exchanging information with other onion marketing committees, as well as with other individuals or agencies in connection with all proper committee activities and objectives under this subpart. The duties listed in proposed Sec. 956.31 are reasonable and necessary if the committee is to function in the manner prescribed under the Act and the order. It should be recognized that the duties specified are not necessarily all inclusive, and it may develop that there are other duties that the committee may need to perform which are incidental to, and not inconsistent with, these specified duties. (c) The committee should be authorized under Sec. 956.40 of the proposed order to incur such expenses as the Secretary finds are reasonable and likely to be incurred during each fiscal year. Such a provision is necessary to assure the maintenance and functioning of the committee, as well as to finance production research and market promotion programs. Necessary expenses would include, but would not be limited to, such items as employee salaries and benefits; establishment of an office and equipping such office; telephone and mail services; and business-related transportation for the committee staff. Expenses incurred by committee members in attending committee meetings should also be a reimbursable expense. All such expenses may be incurred on an ongoing basis. The committee, under proposed Sec. 956.41, should be required to prepare a budget showing estimates of income and expenditures necessary for the administration of the marketing order during each fiscal year. The budget, including an analysis of its component parts, should be submitted to the Secretary sufficiently in advance of each fiscal period to provide for the Secretary's review and approval. The submitted budget should include a recommendation to the Secretary of a rate of assessment designed to secure all or part of the income required for such fiscal year. The committee should be permitted to use reserve and other committee funds carried over from previous years, and voluntary contributions, to meet budget requirements as authorized under the order. The Act authorizes the Secretary to approve the incurring of expenses by the administrative agency established under an order and states that the order must contain provisions requiring handlers to pay their pro rata share of such expenses. The rate of assessment should be established by the Secretary on the basis of the committee's recommendation and other available information in accordance with proposed Sec. 956.42. In the event that an assessment rate is established which does not generate sufficient income to pay for the approved expenses, the committee should be authorized to recommend to the Secretary an increase in the rate of assessment in order to secure sufficient funds. The Secretary may approve an assessment rate increase, and such increase should be applicable to all Walla Walla Sweet Onions handled during the fiscal year to which that assessment rate applies. The order should provide for the payment of assessments by first handlers of Walla Walla Sweet Onions for the maintenance and functioning of the committee throughout the time the order is in effect, irrespective of whether particular provisions of the order are suspended or are inoperative. For example, adverse weather during a growing season could result in reduced supplies, and therefore, planned market support activities for the season could be canceled. The committee should be able to continue levying assessments to pay other approved expenses incurred for other purposes. If a handler does not pay any assessment by the date it is due, the order should provide that the late assessment may be subject to a late payment charge or an interest charge, or both, at rates set by the committee with the Secretary's approval. Such charges should be set at rates established to cover additional costs that may be incurred by the committee in attempting to collect overdue assessments, and should encourage timely payments. The period in which payments would be considered late, and late payment charges or interest charges incurred should be recommended by the committee and approved by the Secretary. The committee should be authorized to accept advance payment of assessments so that it may pay expenses which become due before assessment income is normally received. This would give the committee more flexibility in paying obligated expenses, particularly in the first part of a fiscal year before assessment funds are received. The committee should also be able to borrow money to meet administrative expenses that would be incurred before assessment income is sufficient to defray such expenses. However, the committee should not borrow money to pay obligations if sufficient funds already exist in the committee's reserve fund or in other committee accounts. All funds collected by the committee through assessments or any other provision of the order should be used only for the purposes set forth in the order, as set forth in proposed Sec. 956.43. The Secretary should at all times have authority to require the committee, its members and alternates, and its employees and agents to account for all receipts, disbursements, property or records of the committee for which such person has been responsible. Likewise, when any such person ceases to act in the aforesaid positions, that person should account for all receipts, disbursements, property or records of the committee for which such person has been responsible. In the event the order is terminated or becomes inoperative, the committee should appoint, with the approval of the Secretary, one or more trustees for holding records, funds or other property of the committee. If, at the end of a fiscal period, the assessments collected are in excess of expenses incurred, such excess should be established as a reserve or refunded pro rata to the handlers, under proposed Sec. 956.44. The committee should be authorized to carry over excess assessment income into the following fiscal period as a reserve. If such excess income is not carried over as a reserve, handlers should be entitled to a refund proportionate to the assessments each handler paid. The reserve should not be allowed to exceed approximately two years' of committee expenses. One purpose of the reserve fund would be to provide stability in the administration of the order in the case of a short crop. Also, establishing a reserve should minimize the necessity of the committee borrowing money at the beginning of a fiscal year or raising an assessment rate during a season of less than anticipated production. Finally, reserve funds could be used to cover necessary liquidation expenses in the event the order is terminated. Upon such termination, any funds not needed to defray liquidation expenses should be disposed of as determined by the Secretary. To the extent possible, however, these funds should be returned pro rata to the handlers from whom they were collected. Under proposed Sec. 956.45, for the payment of production research or promotional activities as authorized by the order, the committee should also be authorized to receive voluntary contributions. Testimony also indicated that contributions should be authorized for first-year administrative start-up costs. Such contributions should be received by the committee without any obligations to the donor, and the expenditure of such funds should be under the complete control of the committee and subject to the provisions of the order. The committee should not receive a voluntary contribution from any person if that contribution could represent a conflict of interest. Testimony indicates that donations should be considered as miscellaneous receipts, the same as interest or dividend income, and be subject to all of the accounting provisions of the order. (d) Under proposed Sec. 956.50, the order should authorize the committee to establish and provide for the establishment of production research, marketing research and development, and marketing promotion projects, including paid advertising, designed to assist, improve, or promote the marketing, distribution, consumption, or efficient production of Walla Walla Sweet Onions. Funding for these programs should come from any authorized receipts of the committee including assessment income, voluntary contributions and miscellaneous income such as interest. The committee should have the authority to initiate new production and marketing research projects, as well as to contribute to research which may currently be taking place. Testimony indicated that public funds for research are becoming scarcer and more difficult to obtain. Marketing order proponents believe that their industry needs to finance research on improved onion storage and cultural practices. The record also supports the need for marketing research and promotion projects. Research would enable the Walla Walla Sweet Onion industry to identify and analyze its current markets and find ways of expanding current markets and developing new ones. Expanding markets for Walla Walla Sweet Onions could be accomplished by promotional activities, including paid advertising, to acquaint wholesalers, retailers, and consumers with the product available from the Walla Walla area. Market development projects would enable the committee to compile meaningful market data and to explore marketing possibilities, such as how to gain entry to or recapture a specific market. That authority also would enable the committee to contact buyers and food editors to distribute educational material relating to the handling and marketing of Walla Walla Sweet Onions, and disseminate to the industry the results of current or past marketing research projects. It would also allow the committee to give out promotional literature, recipes, and information relative to consumption or use. Record testimony indicated that the committee should be authorized to develop and register a common identifying mark, or logo, that could be used by all Walla Walla Sweet Onion producers and handlers to distinguish the Walla Walla Sweet Onion in the marketplace. Proponents supported utilizing such a mark in conjunction with any paid advertising, to make the consumer aware that they are purchasing Walla Walla Sweet Onions. Witnesses supported advertising as a means of increasing demand for Walla Walla Sweet Onions. Walla Walla Sweet Onions have a very limited marketing season (June to early August) and prices customarily begin to decline rapidly over the season. Proponents believe an education and advertising campaign would help increase the public's awareness of this specialty onion with the objective of expanding the market and increasing consumption of Walla Walla Sweet Onions. Paid advertising with an identifying mark would assist in clarifying and maintaining the Walla Walla Sweet Onion's image in the marketplace in a way not available through other forms of promotion or publicity. Also, Walla Walla Sweet Onion producers face larger and better funded competition. Testimony indicates that paid advertising is necessary for the industry to be competitive and maintain or increase its market share. Testimony also indicates that advertising could have a positive influence on the demand for Walla Walla Sweet Onions, particularly in times of heavy supply, thereby tending to increase grower returns. Market promotion programs, including paid advertising, for Walla Walla Sweet Onions carried out with funds collected under the proposed program, would be generic in nature and would not use particular name brands, handler or producer names, or favor any particular portion of the production area. In addition, any promotional material or advertising would not be authorized to make false or unwarranted claims on behalf of Walla Walla Sweet Onions. Nor would such material be authorized to include statements that disparage other agricultural commodities. The record does not indicate the amount of assessment funds that may be allotted for research and promotion programs. The committee should have the responsibility to determine the amount of funds spent on each program each year. Such determination should be based on the needs of the industry each year. The amount of funds to be spent on research and promotion programs would be included in the annual budget required to be submitted to the Secretary for review and approval. All research and promotion projects to be conducted under the order in a given fiscal period should be submitted by the committee to the Secretary for approval prior to being undertaken. This will ensure that all projects are appropriate given the order's authority, and that sufficient funds will be available for their funding. Further, the committee should be required to report at least annually on the progress of each project and at the conclusion of each project. Such reports should be made to the Secretary. (e) In accordance with proposed Sec. 956.61, the committee should have the authority to recommend regulations to the Secretary, whenever it believes that regulations issued pursuant to proposed Sec. 956.62 regarding container markings would be appropriate. Also, the committee should be authorized to recommend to the Secretary the amendment, modification, termination, or suspension of any regulation issued under this part, when deemed necessary. The committee should also be permitted to recommend modification, termination, or suspension of any regulation or amendment thereto to facilitate the handling of Walla Walla Sweet Onions for special purpose handling pursuant to proposed Sec. 956.63, regarding handling for specified purposes. The committee should have the authority to recommend to the Secretary rules and regulations for fixing the markings of the containers used in the packaging and handling of Walla Walla Sweet Onions. This could include a logo or other markings that would identify the contents of such containers. Such a logo or other marking would be small enough to be used in conjunction with the handler's own label, so that handlers would not have to incur the cost of having existing labels remade. As set forth in proposed Sec. 956.63, there should be provision for handling Walla Walla Sweet Onions in other than fresh market channels differently than those for the fresh market. It would authorize the Secretary, whenever it is found that it would tend to effectuate the declared policy of the Act, to issue regulations, suspend or terminate assessment requirements, container marking regulations, or any combination thereof, to facilitate the handling of Walla Walla Sweet Onions for other than fresh market uses. Such uses would be for relief or charity, livestock feed, planting and/or plants, salad onions, and all processing uses including canning, freezing, pickling, peeling, dehydration, juicing, or other processing. In addition, shipments for disposal, for packing and storing within the production area or to specified areas outside the production area in Washington and Oregon, or for other purposes which may be specified are included. Requirements for special purpose shipments would be intended to ensure that shipments of Walla Walla Sweet Onions for these uses would not be diverted to the fresh market. Shipments for relief, charity, or livestock feed would not compete with fresh market shipments in the market place. Onion plants are too small to be used as a food product. Salad onions, i.e., immature Walla Walla Sweet Onions of smaller sizes, usually 1\1/2\ to 2 inches in diameter, would not normally be regulated in the same way as fully mature, dry bulbs. Onions for canning and freezing are exempt from regulation under the authority for this part, and onions of such poor quality that they must be destroyed would not be marketable in any case. Shipments for storage both within and in specified locations outside of the production area would be handled as special purpose shipments with suitable safeguards. Such safeguards might be in the form of handler reports and would include such information that the committee would deem adequate to ensure compliance with program provisions. Other safeguards, unforeseen at this time, might be needed to assure program compliance and prevent abuses. Hence, the committee should be provided the flexibility to recommend, with approval of the Secretary, other safeguards as needed. There should be authority under proposed Sec. 956.64 to establish minimum quantities of Walla Walla Sweet Onions that would not be subject to regulation under this part. Testimony indicates that this quantity should be recommended by the committee and approved by the Secretary. Such quantities would not be subject to the requirements set forth in Secs. 956.42, 956.62, and/or 956.63. Such quantities usually are too small to affect the overall marketing of Walla Walla Sweet Onions. In accordance with proposed Sec. 956.65, the Secretary should notify the committee of each regulation issued, and of each amendment, modification, suspension, or termination thereof, and the committee would give reasonable notice of such action to handlers subject to this part. Such notification would be necessary for the efficient operation of the marketing order. The committee should be able to issue appropriate rules, regulations, and safeguards in connection with shipments for specified purposes and minimum quantity shipments. Such rules and regulations should authorize the use of appropriate safeguards under proposed Sec. 956.66. The term ``certificate of privilege'' is intended to mean the approval or permit necessary to make special purpose shipments. Authority should be included for the committee to specify the requirements contained in the certificate of privilege. Such requirements, established through rulemaking, would be intended to ensure that shipments would not be diverted to the fresh market. Safeguards should be adequate so that the committee can track such shipments from the time they leave the local shipping point to ultimate destination. This would be necessary to determine that such shipments did not enter fresh market channels of trade. The committee should have the authority to rescind or deny certificates of privilege or any other permit to any handler if proof is obtained that such handler shipped Walla Walla Sweet Onions for any other purpose than stated on the certificate of privilege. The committee would rescind or deny certificates only after an appropriate investigation concerning the alleged shipments and upon adequate and substantial proof that the handler did in fact violate the regulation. The Secretary would have the right to modify, change, or rescind any safeguards prescribed and any certificates issued by the committee pursuant to the provisions of this section. The committee would report to the Secretary such information concerning certificates of privilege as may be requested. (f) The committee should have the authority, under proposed Sec. 956.80, with the approval of the Secretary, to require that first handlers submit to the committee such reports and information as the committee may need to perform its functions and fulfill its responsibilities under the order. In the normal course of business, Walla Walla Sweet Onion handlers collect and record information that may be needed by the committee. Witnesses expressed the belief that the reporting requirements that may be imposed under the proposed order would not constitute an undue burden on handler businesses since the information is typically collected for other purposes. Reports could be needed by the committee for such purposes as collecting assessments; compiling statistical data for use in evaluating marketing research and development projects; promotional activities; making recommendations for production research; and determining whether handlers are complying with order requirements. The record evidence indicates that to the extent necessary for the committee to perform its functions, handlers will likely need to provide information on the quantity of Walla Walla Sweet Onions handled each season. This required information may include, but would not necessarily be limited to, the quantities of Walla Walla Sweet Onions received by the handler and the quantities disposed of by such handler, the date of each such receipt and disposition, and the identity of the carrier transporting such onions. This should not be construed as a complete list of information the committee might require, nor should it be assumed that all of the above would necessarily be required of handlers. There may be other reports or kinds of information that the committee may find necessary for the proper conduct of its operations under the order. Therefore, the committee should have the authority, with the Secretary's approval, to require each handler to furnish such information as it finds necessary to perform its duties under the order. Each handler should be required to maintain such records of Walla Walla Sweet Onions received and disposed of as may be necessary to verify the reports that the handlers submit to the committee. All such records should be maintained for at least two fiscal periods after the fiscal period in which the transactions occurred. The order should provide that the Secretary and authorized employees of the committee should have access to handlers' premises to examine those records pertaining to matters within the purview of the order. This provision would enable verification of compliance with requirements of the order. All reports and records submitted for committee use by handlers would be required to remain confidential and be disclosed to none other than persons authorized by the Secretary, as required by the Act. Such reports should become part of the committee and Secretary's records. However, the committee should be authorized to release composite information from any or all reports that do not reveal confidential information. Such composite information could be helpful to the committee and to the industry in planning operations under the order and in promoting the order. Any release of composite information should not disclose the identity of the persons furnishing the information or any person's individual operation. (g) No handler should be permitted to handle Walla Walla Sweet Onions except in conformity with the provisions of this part, as set forth in proposed Sec. 956.89. If the program is to be effective, compliance with its requirements is essential, and no handler should be permitted to evade any of its provisions. Any such evasion, on the part of even one handler, could be demoralizing to those handlers who are in compliance and would tend to impair the effective operation of the program. Witnesses testified that consumers are being deceived when they purchase onions they believe to be Walla Walla Sweet Onions, but which are actually onions produced outside the production area. Proponents testified that the application of the Walla Walla name to onions not grown in the production area is an unfair trade practice that destroys the reputation of the Walla Walla Sweet Onion and causes harm to the industry. The Act provides that a marketing order can only apply to a defined commodity grown in a specified production area. No authority exists for regulating the handling of that commodity grown outside that production area. In accordance with proposed Sec. 956.85, the order should provide that the Secretary conduct a periodic referendum every six years with the initial referendum conducted within six years of the effective date of the marketing order. The Secretary of Agriculture has determined that continuance referenda are an effective means for ascertaining whether producers favor continuance of marketing order programs. The Act provides that the Secretary shall terminate a marketing order whenever, through the conduct of a referendum, it is indicated that a majority of all producers favor termination and such majority produced more than 50 percent of the commodity for market during a representative period. Since less than 50 percent of all producers usually participate in a referendum, it is difficult to determine overall producer support or opposition to termination of an order. Thus, to provide a basis for determining whether producers favor continuance of the order, a provision for continuance referenda should be included. Continuance should be based upon the affirmative vote of either two-thirds of the producers voting or an affirmative vote of the producers of two-thirds of the volume of Walla Walla Sweet Onions represented in the referendum. The Act requires that in the promulgation or amendment of a marketing order, at least two-thirds of the producers voting, by number or volume represented in the referendum, must favor the issuance or amendment of a marketing order. Continuance referenda should be based on the same standard of industry support. This requirement is considered adequate to measure producers' support to continue the marketing order. The Secretary would consider termination of the order if less than two-thirds of the producers voting in the referendum and producers of less than two-thirds of the volume of Walla Walla Sweet Onions represented in the referendum favor continuance. In evaluating the merits of continuance versus termination, the Secretary should not only consider the results of the referendum but also should consider all other relevant information concerning the operation of the order and the relative benefits and disadvantages to producers, handlers and consumers in order to determine whether continued operation of the order would tend to effectuate the declared policy of the Act. In any event, section 608(C)(16)(B) of the Act requires the Secretary to terminate the order whenever the Secretary finds that the majority of all producers favor termination, and that such majority produced more than 50 percent of the commodity for market. The Secretary's ``Guidelines for Fruit, Vegetable, and Specialty Crop Marketing Orders'' provide for periodic referenda to allow producers the opportunity to indicate their support for or rejection of a marketing order. It is the position of the Department that periodic referenda ensure that marketing order programs continue to be accountable to producers, obligate producers to evaluate their programs periodically, and involve them more closely in their operation. The record evidence supports these goals. The provisions of proposed Secs. 956.87 through 956.99 of the order as contained in the Notice of Hearing and hereinafter set forth, are common to marketing agreements and orders now operating. All such provisions are incidental to and not inconsistent with the Act and are necessary to effectuate the other provisions of the marketing order and marketing agreement and to effectuate the declared policy of the Act. The record evidence supports inclusion of each such provision as proposed in the Notice of Hearing. These provisions, which are applicable to both the marketing agreement and the marketing order, are identified by section number and heading as follows: Sec. 956.87 Proceedings after termination; Sec. 956.88 Effect of termination or amendment; Sec. 956.90 Right of the Secretary; Sec. 956.91 Duration of immunities; Sec. 956.92 Agents; Sec. 956.93 Derogation; Sec. 956.94 Personal liability; Sec. 956.95 Separability; and Sec. 956.96 Amendments. Those provisions applicable to the marketing agreement only are: Sec. 956.97 Counterparts; Sec. 956.98 Additional parties; and Sec. 956.99 Order with marketing agreement. Miscellaneous changes have been made from the provisions as proposed in the notice of hearing for the purpose of clarity. List of Subjects in 7 CFR Part 956 Marketing agreements, Onions, Reporting and recordkeeping requirements. Title 7, Chapter IX is proposed to be amended by adding Part 956 to read as follows: PART 956--SWEET ONIONS GROWN IN THE WALLA WALLA VALLEY OF SOUTHEAST WASHINGTON AND NORTHEAST OREGON Subpart--Order Regulating Handling Definitions Sec. 956.1 Secretary. 956.2 Act. 956.3 Person. 956.4 Production area. 956.5 Walla Walla Sweet Onions. 956.6 Handler. 956.7 Registered handler. 956.8 Handle. 956.9 Container. 956.10 Producer. 956.11 Varieties. 956.12 Committee. 956.13 Fiscal period. Administrative Committee 956.20 Establishment and membership. 956.21 Term of office. 956.22 Nominations. 956.23 Selection. 956.24 Qualifications and acceptance. 956.25 Alternates. 956.26 Vacancies. 956.27 Failure to nominate. 956.28 Procedure. 956.29 Expenses. 956.30 Powers. 956.31 Duties. Expenses and Assessments 956.40 Expenses. 956.41 Budget. 956.42 Assessments. 956.43 Accounting. 956.44 Excess funds. 956.45 Contributions. Research and Development 956.50 Research and development. Regulation 956.61 Recommendation for regulations 956.62 Container markings. 956.63 Handling for specified purposes. 956.64 Minimum quantities. 956.65 Notification of regulations. 956.66 Safeguards. Reports 956.80 Reports and recordkeeping. Miscellaneous Provisions 956.85 Termination or suspension. 956.87 Proceedings after termination. 956.88 Effect of termination or amendment. 956.89 Compliance. 956.90 Right of the Secretary. 956.91 Duration of immunities. 956.92 Agents. 956.93 Derogation. 956.94 Personal liability. 956.95 Separability. 956.96 Amendments. 956.97 Counterparts. 956.98 Additional parties. 956.99 Order with marketing agreement. Authority: 7 U.S.C. 601-674. Definitions Sec. 956.1 Secretary. Secretary means the Secretary of Agriculture of the United States or any officer or employee of the Department of Agriculture who has been delegated, or to whom authority may hereafter be delegated, the authority to act for the Secretary. Sec. 956.2 Act. Act means Public Act No. 10, 73d Congress (May 12, 1933), as amended and as reenacted and amended by the Agricultural Marketing Agreement Act of 1937, as amended (Sec. 1-19, 48 Stat. 31, as amended; 7 U.S.C. 601 et seq.). Sec. 956.3 Person. Person means an individual, partnership, corporation, association, or any other business unit. Sec. 956.4 Production area. Production area means a tract of land in Umatilla County, Oregon, and Walla Walla County, Washington, based on surveyors' maps, enclosed by the following boundaries: Commencing at the Southeast corner of Section 13, Township (Twp.) 5 North, Range (Rge.) 36 East, W.M.; thence Westerly along the South line of Sections 13, 14, 15, 16, 17, and 18 in Twp. 5 North, Rge. 36 East, Sections 13, 14, 15, 16, 17, and 18 in Twp. 5 North, Rge. 35 East, Sections 13, 14, 15, 16, 17, and 18 in Twp. 5 North, Rge. 34 East, Sections 13, 14, and 15 in Twp. 5 North, Rge. 33 East, W.M. to the East right of way line of the Northern Pacific Railway, as it runs Northwesterly through Vansyckle Canyon; thence Northwesterly along said Easterly right of way line to a point in the Northwest \1/4\ of Section 20, Twp. 7 North, Rge. 32 East, W.M. where said line intersects the South right of way of the Union Pacific Railway, said intersection being commonly known as Zangar Junction; thence Easterly along said South right of way line of the Union Pacific Railway to a point in the Southwest \1/4\ of Section 23, Twp. 7 North, Rge. 32 East where said line intersects the South right of way line of Washington State Highway No. 12; thence Easterly along said South right of way line to the intersection with the West line of Section 34, Twp. 7 North, Rge. 33 East, W.M.; thence North, along the West line of Sections 34, 27, 22, 15, 10, and 3 in Twp. 7 North, Rge. 33 East, W.M., and the West line of Sections 34, 27, and 22 in Twp. 8 North, Rge. 33 East, W.M. to the Northwest corner of said Section 22; thence East along the North line of said Section 22 to the Northeast corner thereof; thence North along the West line of Sections 14, 11, and 2 in Twp. 8 North, Rge. 33 East, W.M. to the Northwest corner of said Section 2; thence East along North lines of Sections 2 and 1 in Twp. 8 North, Rge. 33 East, W.M. and the North line of Section 6, Twp. 8 North, Rge. 34 East, W.M. to the centerline of the Touchet River; thence northerly and Easterly along said centerline of the Touchet River as it runs through Twp. 9 North, Rge. 34 East, Twp. 9 North, Rge. 35 East, Twp. 10 North, Rge. 35 East, Twp. 10 North, Rge. 36 East, Twp. 9 North, Rge. 36 East, and Twp. 9 North, Rge. 37 East to a point on the East line of Section 11 in Twp. 9 North, Rge. 37 East, W.M., thence South along the East line of Sections 11, 14, 23, 26, and 35 in Twp. 9 North, Rge. 37 East, W.M., the East lines of Sections 2, 11, 14, 23, 26, and 35 in Twp. 8 North, Rge. 37 East, W.M., the East lines of Sections 2, 11, 14, 23, 26, and 35 in Twp. 7 North, Rge. 37 East, W.M., and the East lines of Sections 2, 11, and fractional Section 14 in Twp. 6 North, Rge. 37 East, W.M., to a point on the Washington-Oregon State line; thence West along said State Line to the closing corner on the West side of Section 18 in Twp. 6 North, Rge. 37 East, W.M.; thence South along the West line of Sections 18, 19, 30, and 31 in Twp. 6 North, Rge. 37 East, W.M. and the West line of Sections 6, 7, and 18 in Twp. 5 North, Rge. 37 East to the corner common to Sections 18 and 19 in Twp. 5 North, Rge. 37 East, W.M. and 13 and 24 in Twp. 5 North, Rge. 36 East, W.M., Being the True Point of Beginning of this Legal Description. Sec. 956.5 Walla Walla Sweet Onions. Walla Walla Sweet Onions means all varieties of Allium cepa grown within the production area, except Spanish hybrid varieties. The committee may, with the approval of the Secretary, exempt individual varieties from any or all regulations issued under this part. Sec. 956.6 Handler. Handler is synonymous with ``shipper'' and means any person (except a common or contract carrier of Walla Walla Sweet Onions owned by another person) who handles Walla Walla Sweet Onions or causes Walla Walla Sweet Onions to be handled. Sec. 956.7 Registered handler. Registered handler means any person with adequate facilities for preparing Walla Walla Sweet Onions for commercial market, who has requested such registration and is so recorded by the committee, or any person who has access to such facilities and has recorded with the committee the ability and willingness to assume customary obligations of preparing Walla Walla Sweet Onions for commercial market. The committee may recommend, for approval of the Secretary, procedures with respect to handler registration. Sec. 956.8 Handle. Handle is synonymous with ``ship'' and means to package, load, sell, transport, or in any way place Walla Walla Sweet Onions or cause Walla Walla Sweet Onions to be placed in the current of commerce within the production area or between the production area and any point outside thereof. Such term shall not include the transportation, sale, or delivery of harvested Walla Walla Sweet Onions to a handler within the production area for the purpose of having such Walla Walla Sweet Onions prepared for market. Sec. 956.9 Container. Container means a box, bag, crate, hamper, basket, package, or any other receptacle used in the packaging, transporting, sale, shipment, or other handling of Walla Walla Sweet Onions. Sec. 956.10 Producer. Producer is synonymous with ``grower'' and means any person engaged in a proprietary capacity in the production of Walla Walla Sweet Onions for market. Sec. 956.11 Varieties. Varieties means and includes all classifications, subdivisions, or types of Walla Walla Sweet Onions according to those definitive characteristics now or hereafter recognized by the United States Department of Agriculture or recommended by the committee and approved by the Secretary. Sec. 956.12 Committee. Committee means the Walla Walla Sweet Onion Committee established pursuant to Sec. 956.20. Sec. 956.13 Fiscal period. Fiscal period means the period beginning on June 1 and ending on May 31 of each year, or other such period as may be recommended by the committee and approved by the Secretary. Administrative Committee Sec. 956.20 Establishment and membership. (a) The Walla Walla Sweet Onion Committee, consisting of ten members, is hereby established. The committee shall consist of six producer members, three handler members, and one public member. Each member shall have an alternate who shall have the same qualifications as the member. (b) A producer shall have three years of experience in producing onions in order to qualify for committee membership. At the time of selection, no more than two producer members may be affiliated with the same handler. Sec. 956.21 Term of office. (a) Except as otherwise provided in paragraph (b) of this section, the term of office of committee members and their respective alternates shall be for three fiscal periods beginning on June 1 or such other date as recommended by the committee and approved by the Secretary. The terms shall be determined so that one-third of the grower membership and one-third of the handler membership shall terminate each year. Members and alternates shall serve during the term of office for which they are selected and have been qualified, or during that portion thereof beginning on the date on which they qualify during such term of office and continuing until the end thereof, or until their successors are selected and have qualified. (b) The term of office of the initial members and alternates shall begin as soon as possible after the effective date of this subpart. One-third of the initial industry members and alternates shall serve for a one-year term, one-third shall serve for a two-year term, and one-third shall serve for a three-year term. The initial, as well as all successive terms of office of the public member and alternate member shall be for three years. (c) The consecutive terms of office for all members shall be limited to two three-year terms. There shall be no such limitation for alternate members. Sec. 956.22 Nominations. Nominations from which the Secretary may select the members of the committee and their respective alternates may be made in the following manner: (a) The committee shall hold or cause to be held, within the production area and prior to April 1 of each year or by such other date as may be specified by the Secretary, one or more meetings of producers and handlers for the purpose of designating one nominee for each of the member and alternate member positions which are vacant or will be vacant at the end of the fiscal period; (b) In arranging for such meetings the committee may, if it deems such desirable, cooperate with existing organizations and agencies; (c) Nominations for committee members and alternate members shall be provided to the Secretary, in such manner and form as the Secretary may prescribe, not later than 30 days prior to the end of the fiscal period within which the current term of office expires; (d) Only producers may participate in designating nominees for producer committee members and their alternates and only handlers may participate in designating nominees for handler committee members and their alternates; (e) Each person who is both a handler and a producer may vote either as a handler or as a producer, but not both; (f) Each person is entitled to cast only one vote on behalf of him or herself, his or her partners, agents, subsidiaries, affiliates and representatives, in designating nominees for committee members and alternates. An eligible producer's or handler's privilege of casting only one vote, as aforesaid, shall be construed to permit such voter to cast one vote for each producer member and alternate member position to be filled or each handler member and alternate member position to be filled, but not both. (g) Every three years, at the first meeting following selection, the committee shall nominate the public member and alternate for a three-year term of office. (h) The committee shall prescribe such additional qualifications, administrative rules and procedures for selection and voting for each candidate as it deems necessary and as the Secretary approves. Sec. 956.23 Selection. The Secretary shall select members and alternate members of the committee from the nominations made pursuant to Sec. 956.22 or from other qualified persons. Sec. 956.24 Qualification and acceptance. Any person nominated to serve as a member or alternate member of the committee shall, prior to selection by the Secretary, qualify by filing a written background and acceptance statement indicating such person's willingness to serve in the position for which nominated. Sec. 956.25 Alternates. An alternate member of the committee shall act in the place and stead of the member for whom such person is an alternate, during such member's absence. In the event of the death, removal, resignation, or disqualification of a member, that member's alternate shall serve until a successor to such member has qualified and is selected. Sec. 956.26 Vacancies. To fill any vacancy occasioned by the failure of any person nominated as a member or as an alternate to qualify, or in the event of the death, removal, resignation, or disqualification of a member or alternate, a successor for the unexpired term may be selected by the Secretary from nominations made pursuant to Sec. 956.22 from previously unselected nominees on the current nominee list, or from other eligible persons. Sec. 956.27 Failure to nominate. If nominations are not made within the time and manner prescribed in Sec. 956.22 the Secretary may, without regard to nominations, select the members and alternates on the basis of the representation provided for in Sec. 956.20. Sec. 956.28 Procedure. (a) Six members of the committee shall constitute a quorum, and six concurring votes shall be required to pass any motion or approve any committee action, except that recommendations made pursuant to Sec. 956.61 shall require seven concurring votes. (b) The committee may provide for meetings by telephone, telegraph, facsimile, or other means of communication, and any vote cast orally at such meetings shall be confirmed promptly in writing: Provided, That if an assembled meeting is held, all votes shall be cast in person. Sec. 956.29 Expenses. Members and alternates shall serve without compensation but shall be reimbursed for such expenses authorized by the committee and necessarily incurred by them in attending committee meetings and in the performance of their duties under this part. Sec. 956.30 Powers. The committee shall have the following powers: (a) To administer the provisions of this part in accordance with its terms; (b) To make rules and regulations to effectuate the terms and provisions of this part; (c) To receive, investigate, and report to the Secretary complaints of violations of the provisions of this part; and (d) To recommend to the Secretary amendments to this part. Sec. 956.31 Duties. It shall be among the duties of the committee: (a) At the beginning of each fiscal period, or as soon thereafter as practicable, to meet and organize, to select a chairman and such other officers as may be necessary, to select subcommittees, and to adopt such rules and regulations for the conduct of its business as it may deem advisable; (b) To act as intermediary between the Secretary and any producer or handler; (c) To furnish to the Secretary such available information as the Secretary may request; (d) To appoint such employees, agents, and representatives as it may deem necessary and to determine the salaries and define the duties of each such person; (e) To investigate from time to time and to assemble data on the growing, harvesting, shipping, and marketing conditions with respect to Walla Walla Sweet Onions and to engage in such research and service activities which relate to the production, handling, or marketing of Walla Walla Sweet Onions as may be approved by the Secretary; (f) To keep minutes, books, and records which clearly reflect all of the acts and transactions of the committee. Such minutes, books, and records shall be subject to examination at any time by the Secretary or the Secretary's authorized agent or representative; (g) To make available to producers and handlers the committee voting record on recommended regulations and on other matters of policy; (h) Prior to each fiscal period, to submit to the Secretary a budget of its proposed expenses for such fiscal period, together with a report thereon, and a recommendation as to the rate of assessment for such period; (i) To cause its books to be audited by a competent accountant at least once each fiscal period, and at such other time as the committee may deem necessary or as the Secretary may require; the report of such audit shall show the receipt and expenditure of funds collected pursuant to this part; a copy of each such report shall be furnished to the Secretary, and a copy of each such report shall be made available at the principal office of the committee for inspection by producers and handlers: Provided, that confidential information shall be removed from all copies made available to the public; and (j) To consult, cooperate, and exchange information with other onion marketing committees and other individuals or agencies in connection with all proper committee activities and objectives under this subpart. Expenses and Assessments Sec. 956.40 Expenses. The committee is authorized to incur such expenses as the Secretary may find are reasonable and likely to be incurred by the committee for its maintenance and functioning, and to enable it to exercise its powers and perform its duties in accordance with the provisions of this part. The funds to cover such expenses shall be acquired in the manner prescribed in Secs. 956.42 and 956.45. Sec. 956.41 Budget. Prior to each fiscal period and as may be necessary thereafter, the committee shall prepare an estimated budget of income and expenditures necessary for the administration of this part. The committee shall recommend a rate of assessment calculated to provide adequate funds to defray its proposed expenditures. The committee shall present such budget to the Secretary with an accompanying report showing the basis for its calculations. Sec. 956.42 Assessments. (a) The funds to cover the committee's expenses shall be acquired by the levying of assessments upon handlers as provided in this subpart. Each person who first handles Walla Walla Sweet Onions shall pay assessments to the committee upon demand, which assessments shall be in payment of such handler's pro rata share of the committee's expenses. (b) Assessments shall be levied upon handlers, at rates established by the Secretary. Such rates may be established upon the basis of the committee's recommendations or other available information. (c) At any time during, or subsequent to, a given fiscal period, the committee may recommend the approval of an amended budget and an increase in the rate of assessment. Upon the basis of such recommendations, or other available information, the Secretary may approve an amended budget and increase the assessment rate. Such increase in the assessment rate shall be applicable to all Walla Walla Sweet Onions which were handled by each handler thereof during such fiscal period. (d) The payment of assessments for the maintenance and functioning of the committee may be required under this part throughout the period it is in effect, irrespective of whether particular provisions of this part are suspended or become inoperative. (e) To provide funds for the administration of the provisions of this part during the initial fiscal period or the first part of a fiscal period when neither sufficient operating reserve funds nor sufficient revenue from assessments on the current season's shipments are available, the committee may accept payment of assessments in advance or may borrow money for such purposes. (f) The committee may impose a late payment charge or an interest charge, or both, on any handler who fails to pay any assessment in a timely manner. Such time and the rates shall be recommended by the committee and approved by the Secretary. Sec. 956.43 Accounting. (a) All funds received by the committee pursuant to the provisions of this part shall be used solely for the purposes specified in this part. (b) The Secretary may at any time require the committee, its members and alternate members, employees, agents, and all other such persons associated with the committee to account for all receipts, disbursements, funds, property, or records for which they are responsible. Whenever any person ceases to be a member, alternate member, employee, or agent of the committee, such person shall account for all receipts, disbursements, funds, property, and records pertaining to the committee's activities for which such person was responsible, deliver all property and funds in such person's possession to the committee, and execute such assignments and other instruments as may be necessary or appropriate to vest in the committee full title to all of the property, funds, and claims vested in such person pursuant to this part. (c) The committee may make recommendations to the Secretary for one or more of the members thereof, or any other person, to act as a trustee for holding records, funds, or any other committee property during periods of suspension of this part, or during any period or periods when regulations are not in effect and, upon determining such action is appropriate, the Secretary may direct that such person or persons shall act as trustee or trustees for the committee. Sec. 956.44 Excess funds. If, at the end of a fiscal period, the assessments collected are in excess of expenses incurred, such excess shall be accounted for as follows: (a) The committee, with approval of the Secretary, may establish an operating reserve and may carry over to subsequent fiscal periods excess funds in a reserve so established, except funds in the reserve shall not exceed the equivalent of approximately two fiscal periods' budgeted expenses. Such reserve funds may be used: (1) To defray any expenses authorized under this part; (2) To defray expenses during any fiscal period prior to the time assessment income is sufficient to cover such expenses; (3) To cover deficits incurred during any fiscal period when assessment income is less than expenses; (4) To defray expenses incurred during any period when any or all provisions of this part are suspended or are inoperative; and (5) To cover necessary expenses of liquidation in the event of termination of this part. (b) Upon termination of this part, any funds not required to defray the necessary expenses of liquidation shall be disposed of in such manner as the Secretary may determine to be appropriate except that to the extent practicable, such funds shall be returned pro rata to the persons from whom such funds were collected. (c) If such excess is not retained in a reserve as provided in paragraph (a) of this section, each handler entitled to a proportionate refund of the excess assessments collected shall be credited at the end of a fiscal period with such refund against the operations of the following fiscal period unless such handler demands payment thereof, in which event such proportionate refund shall be paid as soon as practicable. Sec. 956.45 Contributions. The committee may accept voluntary contributions but these shall be used only to pay expenses incurred pursuant to Sec. 956.50. Such contributions shall be free from any encumbrances by the donor, and the committee shall retain complete control of their use. Research and Development Sec. 956.50 Research and development. (a) The committee, with the approval of the Secretary, may establish or provide for the establishment of production research, marketing research and development, and marketing promotion projects, including paid advertising, designed to assist, improve, or promote the marketing, distribution, consumption, or efficient production of Walla Walla Sweet Onions. Any such project for the promotion and advertising of Walla Walla Sweet Onions may utilize an identifying mark, including but not limited to registered trademarks and logos, which shall be made available for use by all handlers in accordance with such terms and conditions as the committee, with the approval of the Secretary, may prescribe. The committee may register such logos with the Commissioner of Patents and Trademarks, U.S. Patent and Trademark Office. The expense of such projects shall be paid from funds collected pursuant to Secs. 956.42 and 956.45. (b) In recommending projects pursuant to this section, the committee shall give consideration to the following: (1) The expected supply of Walla Walla Sweet Onions in relation to market requirements; (2) The supply situation among competing onion areas and communities; (3) The anticipated benefits from such projects in relation to their costs; (4) The need for marketing research with respect to any market development activity; and (5) Other relevant factors. (c) If the committee concludes that a program of research and development should be undertaken, or continued, in any fiscal period, it shall submit the following for the approval of the Secretary: (1) Its recommendations as to the funds to be obtained pursuant to Secs. 956.42 and 956.45; (2) Its recommendations as to any research projects; and (3) Its recommendations as to promotion activity and paid advertising. (d) Upon conclusion of each activity, but at least annually, the committee shall summarize and report the results of such activity to the Secretary. (e) All marketing promotion activity engaged in by the committee, including paid advertising, shall be subject to the following terms and conditions: (1) No marketing promotion, including paid advertising, shall refer to any private brand, private trademark, or private trade name; (2) No promotion or advertising shall disparage the quality, use, value, or sale of like or any other agricultural commodity or product, and no false or unwarranted claims shall be made in connection with the product; and (3) No promotion or advertising shall be undertaken without reason to believe that returns to producers will be improved by such activity. Regulation Sec. 956.61 Recommendation for regulations. The committee shall recommend regulations to the Secretary whenever it deems it advisable, as provided in Sec. 956.62. The committee also may recommend modification, suspension, or termination of any regulation, or amendments thereto, in order to facilitate the handling of Walla Walla Sweet Onions for the purposes authorized in Sec. 956.63. The committee may also recommend amendment, modification, termination, or suspension of any regulation issued under this part. Sec. 956.62 Container markings. The committee may, with the approval of the Secretary, provide a method, through rules and regulations issued pursuant to this part, for fixing the marking of containers which may be used in the packaging or handling of Walla Walla Sweet Onions, including appropriate logo or other container markings to identify the contents thereof. Further, the committee may, with the approval of the Secretary, establish through rules and regulations such safeguards as may be necessary to ensure that such container marking requirements are complied with. Sec. 956.63 Handling for specified purposes. Upon the basis of recommendations and information submitted by the committee, or other available information, the Secretary may issue special regulations, or modify, suspend, or terminate requirements in effect pursuant to Secs. 956.42 and 956.62 or any combination thereof, in order to facilitate the handling of onions for the following purposes: (a) Shipments of Walla Walla Sweet Onions for relief or to charitable institutions; (b) Shipments of Walla Walla Sweet Onions for livestock feed; (c) Shipments of Walla Walla Sweet Onions for planting and for plants; (d) Shipments of Walla Walla Sweet Onions as salad onions; (e) Shipments of Walla Walla Sweet Onions for all processing uses including, pickling, peeling, dehydration, juicing, or other processing; (f) Shipments of Walla Walla Sweet Onions for disposal; (g) Shipments of Walla Walla Sweet Onions for seed; (h) Shipments of Walla Walla Sweet Onions for packing or storing within the production area or outside the production area, but within specified locations in the States of Oregon and Washington; and (i) Shipments of Walla Walla Sweet Onions for other purposes which may be specified. Sec. 956.64 Minimum quantities. The committee, with the approval of the Secretary, may establish minimum quantities below which Walla Walla Sweet Onion shipments will be free from the requirements in, or pursuant to, Secs. 956.42, 956.62, and 956.63, or any combination thereof. Sec. 956.65 Notification of regulations. The Secretary shall notify the committee of each regulation issued and of each amendment, modification, suspension, or termination thereof. The committee shall give reasonable notice thereof to handlers. Sec. 956.66 Safeguards. (a) The committee, with the approval of the Secretary, may prescribe adequate safeguards to prevent Walla Walla Sweet Onions shipped, pursuant to Secs. 956.63 and 956.64, from entering channels of trade for other than the purpose authorized therefor. (b) The committee, with the approval of the Secretary, may also prescribe rules and regulations governing the issuance, and the contents, of Certificates of Privilege, if such certificates are prescribed as safeguards by the committee. Such safeguards may include requirements that: (1) Handlers shall first file applications with the committee to ship such Walla Walla Sweet Onions. (2) Handlers shall pay the pro rata share of expenses provided by Sec. 956.42 in connection with such Walla Walla Sweet Onions. (3) Handlers shall obtain Certificates of Privilege from the committee prior to effecting the particular onion shipment. (c) The committee may rescind any Certificate of Privilege, or refuse to issue any Certificate of Privilege, to any handler if proof is obtained that Walla Walla Sweet Onions shipped by the handler for the purposes stated in the Certificate of Privilege were handled contrary to the provisions of this part. (d) The Secretary shall have the right to modify, change, alter, or rescind any safeguards prescribed and any certificates issued by the committee pursuant to the provisions of this section. (e) The committee shall make reports to the Secretary as requested, showing the number of applications for such certificates, the quantity of Walla Walla Sweet Onions covered by such applications, the number of such applications denied and certificates granted, the quantity of Walla Walla Sweet Onions handled under duly issued certificates, and such other information as may be requested. Reports Sec. 956.80 Reports and recordkeeping. Upon request of the committee, made with the approval of the Secretary, each handler shall furnish to the committee, in such manner and at such time as it may prescribe, such reports and other information as may be necessary for the committee to perform its duties under this part. (a) Such reports may include, but are not necessarily limited to, the following: (1) The acreage of Walla Walla Sweet Onions grown; (2) The quantities of Walla Walla Sweet Onions received by such handler; (3) The quantities of Walla Walla Sweet Onions disposed of by such handler; (4) The disposition date of such Walla Walla Sweet Onions; (5) The manner of disposition of such Walla Walla Sweet Onions; and (6) The identification of the carrier transporting such Walla Walla Sweet Onions. (b) All such reports shall be held under appropriate protective classification and custody by the committee, or duly appointed employees thereof, so that any information contained therein which may adversely affect the competitive position of any handler in relation to other handlers will not be disclosed. Compilations of general reports from data submitted by handlers is authorized, subject to the prohibition of disclosure of individual handler's identity or operations. (c) Each handler shall maintain for at least two succeeding years such records of the Walla Walla Sweet Onions received and disposed of by such handler as may be necessary to verify reports submitted to the committee pursuant to this section. Miscellaneous Provisions Sec. 956.85 Termination or suspension. (a) The Secretary may at any time terminate the provisions of this subpart by giving at least one day's notice by means of a press release or in any other manner which the Secretary may determine. (b) The Secretary shall terminate or suspend the operations of any or all of the provisions of this subpart whenever it is found that such provisions do not tend to effectuate the declared policy of the act. (c) The Secretary shall terminate the provisions of this subpart at the end of any fiscal period whenever it is found that such termination is favored by a majority of producers who, during a representative period, have been engaged in the production of Walla Walla Sweet Onions: Provided, That such majority has, during such representative period, produced for market more than fifty percent of the volume of such Walla Walla Sweet Onions produced for market, but such termination shall be announced at least 90 days before the end of the current fiscal period. (d) Within six years of the effective date of this subpart the Secretary shall conduct a continuance referendum to ascertain whether continuance of this subpart is favored by producers. Subsequent referenda to ascertain continuance shall be conducted every six years thereafter. The Secretary may terminate the provisions of this part at the end of any fiscal period in which the Secretary has found that continuance of this subpart is not favored by a majority of producers who, during a representative period determined by the Secretary, have been engaged in the production for market of Walla Walla Sweet Onions in the production area. Such termination shall be announced on or before the end of the fiscal period. (e) The provisions of this subpart shall, in any event, terminate whenever the provisions of the Act authorizing them cease to be in effect. Sec. 956.87 Proceedings after termination. (a) Upon the termination of the provisions of this subpart, the then functioning members of the committee shall continue as joint trustees, for the purpose of liquidating the affairs of the committee, of all funds and property then in the possession, or under control, of the committee, including claims for any funds unpaid or property not delivered at the time of such termination. Action by said trusteeship shall require the concurrence of a majority of the said trustees. (b) The said trustees shall continue in such capacity until discharged by the Secretary; shall, from time to time, account for all receipts and disbursements and deliver all property on hand, together with all books and records of said committee and of the trustees, to such person as the Secretary may direct; and shall upon the request of the Secretary, execute such assignments or other instruments necessary or appropriate to vest in such person full title and right to all of the funds, property, and claims vested in said committee or the trustees pursuant to this subpart. (c) Any person to whom funds, property, or claims have been transferred or delivered by the committee or its members pursuant to this section shall be subject to the same obligations imposed upon the members of the committee and upon the said trustees. Sec. 956.88 Effect of termination or amendment. Unless otherwise expressly provided by the Secretary, the termination of this subpart or of any regulation issued pursuant to this subpart, or the issuance of any amendments to either thereof, shall not: (a) Affect or waive any right, duty, obligation, or liability which shall have arisen or which may thereafter arise in connection with any provision of this subpart; (b) Release or extinguish any violation of this subpart or of any regulations issued under this subpart; and (c) Affect or impair any rights or remedies of the Secretary or of any other person with respect to any such violations. Sec. 956.89 Compliance. No handler shall handle Walla Walla Sweet Onions except in conformity to the provisions of this part. Sec. 956.90 Right of the Secretary. The members of the committee, including successors and alternates, and any agent or employee appointed or employed by the committee shall be subject to removal or suspension by the Secretary at any time. Each and every order, regulation, decision, determination, or other act of the committee shall be subject to the continuing right of the Secretary to disapprove of the same at any time. Upon such disapproval, the disapproved action of the committee shall be deemed null and void except as to acts done in reliance thereon or in compliance therewith prior to such disapproval by the Secretary. Sec. 956.91 Duration of immunities. The benefits, privileges, and immunities conferred upon any person by virtue of this subpart shall cease upon the termination of this subpart, except with respect to acts done under and during the existence of this subpart. Sec. 956.92 Agents. The Secretary may, by designation in writing, name any person, including any officer or employee of the Government, or name any agency in the United States Department of Agriculture, to act as the Secretary's agent or representative in connection with any of the provisions of this part. Sec. 956.93 Derogation. Nothing contained in this part is, or shall be construed to be, in derogation or in modification of the rights of the Secretary or of the United States to exercise any powers granted by the Act or otherwise, or, in accordance with such powers, to act in the premises whenever such action is deemed advisable. Sec. 956.94 Personal liability. No member or alternate of the committee or any employee or agent thereof, shall be held personally responsible, either individually or jointly with others, in any way whatsoever, to any handler or to any person for errors in judgment, mistakes, or other acts, either of commission or omission, as such member, alternate, employee, or agent, except for acts of dishonesty, willful misconduct, or gross negligence. Sec. 956.95 Separability. If any provision of this subpart is declared invalid, or the applicability thereof to any person, circumstance, or thing is held invalid, the validity of the remainder of this subpart, or the applicability thereof to any other person, circumstance, or thing shall not be affected thereby. Sec. 956.96 Amendments. Amendments to this subpart may be proposed, from time to time, by the committee or by the Secretary. Sec. 956.97 Counterparts. This agreement may be executed in multiple counterparts, and when one counterpart is signed by the Secretary, all such counterparts shall constitute, when taken together, one and the same instrument as if all signatures were contained in one original. Sec. 956.98 Additional parties. After the effective date hereof, any handler may become a party to this agreement if a counterpart is executed by him and delivered to the Secretary. This agreement shall take effect as to such new contracting party at the time such counterpart is delivered to the Secretary, and the benefits, privileges, and immunities conferred by this agreement shall then be effective as to such new contracting party. Sec. 956.99 Order with marketing agreement. Each signatory handler hereby requests the Secretary to issue, pursuant to the Act, an order providing for regulating the handling of Walla Walla Sweet Onions in the same manner as is provided for in this agreement. Dated: November 3, 1994. Kenneth C. Clayton, Acting Administrator. [FR Doc. 94-27759 Filed 11-4-94; 3:53 pm] BILLING CODE 3410-02-P