2025-00193Proposed Rule

Feds Propose Penny Tax Hike on Texas Oranges Forever

Published Date: 1/15/2025

Proposed Rule

Summary

If you grow oranges or grapefruit in Texas’ Lower Rio Grande Valley, get ready to chip in a bit more! The fee per carton is proposed to go up from 3 cents to 4 cents starting in 2024-2025 and will stay that way unless changed later. This helps support the local citrus industry, and comments on this change are open until February 14, 2025.

Analyzed Economic Effects

3 provisions identified: 1 benefits, 2 costs, 0 mixed.

Assessment Rate Raised to $0.04/Carton

If you handle oranges or grapefruit grown in the Lower Rio Grande Valley in Texas, the assessment you pay would increase from $0.03 to $0.04 per 7/10-bushel carton (effective August 1, 2024) and remain in effect for the 2024-2025 and subsequent fiscal periods unless changed. The increase is $0.01 per carton and was proposed to cover program expenses.

Assessment Funds Cover Budget, Replenish Reserves

The Committee recommends the $0.04 assessment so that, with an estimated 4,000,000 7/10-bushel cartons, assessments would generate $160,000 to cover the Committee's $134,970 budget for 2024-2025 and replenish reserves. The increase is intended to ensure the Committee can fund management, compliance, and administrative expenses listed in the budget.

Producers May Bear Small Share of Cost

The rule increases the assessment obligation on handlers and the document states that some of these costs may be passed on to producers. At the $0.04 rate and an estimated average producer price of $14.15 per carton, the assessment would be about 0.2 percent of producer revenue per carton.

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Key Dates

Effective Date
Published Date
8/1/2024
1/15/2025

Department and Agencies

Department
Independent Agency
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