TITLE 4.AGRICULTURE

Part 1. TEXAS DEPARTMENT OF AGRICULTURE

Chapter 17. MARKETING AND PROMOTION DIVISION

Subchapter G. GO TEXAN PARTNER PROGRAM RULES

4 TAC §§17.302 - 17.304, 17.306, 17.308

The Texas Department of Agriculture (the department) adopts amendments to §§17.302 - 17.304, 17.306 and 17.308, concerning the administration of the department's GO TEXAN Partner Program (GOTEPP), a matching grant program. Sections 17.303, 17.304, and 17.306 are adopted with changes to the proposal published in the May 16, 2003 issue of the Texas Register (28 TexReg 3883). Section 17.302 and §17.308 are adopted without changes and will not be republished.

The amendments are adopted to clarify and update the sections, to establish a requirement that retailers or distributors applying to GOTEPP document a direct benefit to GO TEXAN members, to establish maximum grant award amounts and to establish a maximum number of projects that may be funded per biennium.

No public comments were received on the proposal.

The amendment to §17.302, as adopted, adds a representative of agricultural producers to the GOTEPP advisory board, provides that the board shall meet at least biannually and provides that a majority of the total board membership shall constitute a quorum.

The amendment to §17.303, as adopted, provides additional eligibility requirements for retailers and distributors applying to the program, in order for the applicant to document a proposed project's direct benefit to GO TEXAN members. The department has made changes to the proposal in order to clarify this section, to distinguish between co-applicant producers and originating retailer/distributor applicants.

The amendment to §17.304, as adopted, adds a requirement to disclose names of owners having 10% or more ownership interest in an applicant business entity. The department has made changes to the proposal for purposes of clarification.

The amendment to §17.306, as adopted, updates the address of the department's Marketing and Promotion Division, clarifies that at least a majority of a quorum of the board must approve or deny each project request, and adds new subsection (h) establishing maximum grant awards and a maximum number of projects that may be funded per biennium. The department has made changes to the proposal to clarify this section, to distinguish between a grant award, which does not include matching funds, and the total project amount, which includes grant and matching funds.

The amendment to §17.308, as adopted, establishes a minimum amount of $10 that will be returned to a successful applicant as a refund.

The amendments are adopted under the Texas Agriculture Code, §46.012, which authorizes the department to adopt rules to administer the GO TEXAN Partner Program.

§17.303.Eligibility.

(a) An eligible applicant must be:

(1) a state or regional organization or board that promotes the marketing and sale of Texas agricultural products and does not stand to profit directly from specific sales of agricultural commodities;

(2) a cooperative organization, as defined by §17.301 of this title (relating to Definitions);

(3) a state agency or board that promotes the marketing and sale of agricultural commodities;

(4) a national organization or board that represents Texas producers and promotes the marketing and sale of Texas agricultural products;

(5) a small business, as defined by §17.301 of this title (relating to Definitions); or

(6) any other entity or business, other than a business meeting the definition of small business, that promotes the marketing and sale of Texas agricultural products. If a retailer or distributor, the applicant must demonstrate a direct benefit to GO TEXAN members in the manner provided in subsection (b) of this section. For purposes of this section, the department shall have the sole discretion to determine whether an entity meets program eligibility requirements.

(b) A retailer or distributor who applies under the program, must meet the requirements of paragraph (1) or (2) of this subsection, in order to document a direct benefit to GO TEXAN members:

(1) Applying with GO TEXAN members.

(A) The retailer/distributor must apply jointly with GO TEXAN members, other than associate or other retail members, in order to submit a GOTEPP project proposal.

(B) All participating applicants must be GO TEXAN members.

(i) GOTEPP project proposals with a total project amount from $0.00 to $5,000.00 require a minimum of one co-applicant/producer in addition to the originating retailer or distributor applicant.

(ii) GOTEPP project proposals with a total project amount from $5,001.00 to $30,000.00 require a minimum of three co-applicants/producers in addition to the originating retailer or distributor applicant.

(iii) GOTEPP project proposals with a total project amount from $30,001.00 to $99,999.00 require a minimum of seven co-applicants/producers in addition to the originating retailer or distributor applicant.

(iv) GOTEPP project proposals with a total project amount over $100,000.00 require a minimum of 10 or more co-applicants/producers, in addition to the originating retailer or distributor applicant.

(C) All participating co-applicants and originating applicant retailers/distributors must submit all required GOTEPP documentation.

(D) A retailer/distributor is permitted to utilize the same additional applicants no more than twice in a biennium; or

(2) Demonstration of GO TEXAN members/vendors. Retailer/distributors can apply without applying with other GO TEXAN members if 70% of their members and/or vendors are GO TEXAN members, other than associate or retail members.

(c) All applicants will be required to provide documentation verifying the stated information, in addition, they will be required to report sales information.

§17.304.Requirements for Participation.

To be eligible for participation in this program utilizing matching state funds under this subchapter, an applicant must:

(1) be a member in good standing of the GO TEXAN program;

(2) be an eligible applicant under this subchapter;

(3) prepare and submit a project request in accordance with this subchapter;

(4) submit a notarized affidavit on a form provided by the department certifying and disclosing the following:

(A) that applicant is not currently delinquent in the payment of any franchise taxes owed the State of Texas under Chapter 171, Tax Code and will notify the department of status change; and

(B) that applicant is not currently delinquent in the payment of child support and will notify the department of status change; and

(C) disclosing any existing or potential conflict of interest relative to the evaluation and implementation of the project plan by the board and acknowledge that applicant will notify the department of status change; and

(D) disclosing names of owners having 10% or more ownership interest in a business entity; and

(E) that applicant meets all program requirements to apply for matching funds; and

(5) submit to the department, within ten business days after receiving a request for funds from the department, cash matching funds as specified in the grant performance contract and in accordance with this subchapter.

§17.306.Filing Requirements and Consideration of Project Requests.

(a) Project request. An applicant must submit a project request, completed in accordance with this subchapter, to the department's Marketing and Promotion Division, 1700 N. Congress Ave., 11th Floor, Austin, Texas 78711.

(b) Department review. Department staff will review the project request for completeness and examine the benefits of the project for Texas agriculture and economic growth in the state.

(c) Department staff determination of ineligibility. Department staff may determine that project requests are ineligible for any of the following reasons:

(1) department staff determines that the project request is not complete, in accordance with this subchapter; or

(2) department staff determines that applicant provided false information to the department.

(d) Notification. If a determination of ineligibility is made by staff, the department will notify the applicant in writing, identifying the reasons for ineligibility. Eligible applicants will be notified in writing and advised of the next scheduled board meeting.

(e) Board review of eligible applicants. The board shall approve or deny each project request by at least a majority of the quorum of the board.

(f) Deposit of matching funds. Matching funds for board approved and contracted projects shall be deposited with the department within ten business days after receiving a request for funds from the department. For purposes of this subchapter, "matching" means a dollar-per-dollar amount.

(g) In-kind contributions.

(1) The Department may accept in-kind contributions with a documented, clear monetary value from program applicants to satisfy the matching funds requirement. In-kind contributions may be contributed by the applicant or a third party.

(2) For purposes of this subchapter, the board shall have sole discretion to approve the use of in-kind contributions, in an amount not to exceed 10% of the total approved and contracted project amount, to satisfy the matching funds requirement. Travel expenses approved by the board are deemed to have board approval for treatment solely as in-kind contributions unless specifically stated otherwise.

(3) The successful applicant, or grantee, must provide satisfactory documentation to the department of the actual expenditure or utilization of any approved in-kind contributions by the grantee prior to the release or expenditure by the department of the corresponding GO TEXAN Program matching grant funds. The documentation provided by the grantee must establish the clear monetary value of the in-kind contribution.

(4) Should the grantee fail to provide satisfactory documentation of the in-kind contribution, or should the actual monetary value of the in-kind contribution as established by the documentation fail to equal the projected or anticipated value, the corresponding GO TEXAN Program matching grant funds will be forfeited by the grantee and will revert back to the general GO TEXAN Partner Program Account.

(5) In the event the actual value of the in-kind contribution exceeds the projected or anticipated value, the GO TEXAN Program matching grant funds shall not be increased, but the excess shall be deemed outside the GO TEXAN program and shall be the sole responsibility of the grantee.

(h) Maximum grant awards; number of projects.

(1) A maximum grant award of $75,000 (not including matching funds) per project may be approved by the board, for a maximum total project amount of $150,000 (including matching funds).

(2) A maximum grant award of $75,000 (not including matching funds, with a total project amount of $150,000, including matching funds) per applicant, per biennium, may be approved by the board.

(3) No more than two projects per biennium may be approved for any one applicant.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on July 1, 2003.

TRD-200304041

Dolores Alvarado Hibbs

Deputy General Counsel

Texas Department of Agriculture

Effective date: July 21, 2003

Proposal publication date: May 16, 2003

For further information, please call: (512) 463-4075


Chapter 21. CITRUS

Subchapter A. CITRUS QUARANTINES

4 TAC §21.8, §21.9

The Texas Department of Agriculture (the department) adopts new §21.8 and §21.9, concerning citrus quarantines, without changes to the proposal published in the April 11, 2003, issue of the Texas Register (28 TexReg 3006). New §21.8 is adopted to establish labeling requirements. Labeling will indicate whether the citrus nursery plants originated from Texas. Plants originating outside Texas are quarantined articles, not allowed in Texas, and shall be destroyed. Texas citrus nursery plants produced outside the Texas citrus zone also must undergo severe time-consuming testing to allow entry into the citrus zone. New §21.9 is adopted to establish specific record keeping requirements. Recordkeeping will facilitate a trace back of plants if a damaging disease is detected and a group of plants originating from a particular source needs to be disposed of to manage/eradicate the disease.

A total of 8 comments, all in favor of the amendments and new sections, were received by the deadline for submitting comments. Commentators identified themselves as nurserymen, citrus enthusiasts/hobbyists, university researchers, and some commented anonymously. One commentator asked to exempt citrus grown on Poncirus trifoliata, commonly known as trifoliate rootstock, from the labeling and record-keeping requirements. Another commentator asked to exclude trifoliate hybrids, Carrizo, Swingle and C-35; Cleopatra mandarin; and Volkamer lemon from the same requirements. The commentators maintained that Tristeza virus does not affect or kill citrus trees grown on these rootstocks. Further they claimed that the citrus budwood certification program was developed to protect the Texas citrus industry mainly from the Tristeza virus. They ascertained that citrus trees grown using trifoliate rootstock could not be grown in South Texas, where the state's commercial citrus is cultivated, because of the soil and water incompatibility. They claimed that a nurseryman would never sell trifoliate citrus to South Texas markets because the trees would die if planted in that area.

The department believes that citrus trees grown on the aforementioned trifoliate rootstock and trifoliate hybrids should not be exempt from the labeling and record-keeping requirements. The budwood certification program protects the state's citrus not just from Tristeza virus but also from a number of other virus and virus-like diseases, including tatterleaf and psorosis, which can cause injury to trees grown on trifoliate and trifoliate hybrid rootstocks. In the absence of rootstock sprouts, which usually is the case, it is impossible to distinguish the type of rootstock used in budding a citrus tree. Furthermore, a homeowner from the commercial citrus-producing area of Texas, primarily Cameron, Hidalgo and Willacy Counties, could purchase a tree, for example from Houston, and potentially infect citrus trees in these counties with diseases the budwood program intends to prevent. Because Ponicerus and its hybrids are asymptomatic carriers of Tristeza, exempting them from the labeling and record-keeping requirements poses a great risk to the entire Texas citrus industry. In addition, the stem-pitting form of Tristeza affects all rootstocks, including Poncirus. The department also believes the rule amendments will protect not only commercial citrus, but also citrus grown by homeowners and citrus enthusiasts/hobbyists.

One commentator was concerned that due to the current State of Texas budget shortfall the department may not have sufficient funds for enforcement whereas other commentator wanted to legally pursue out-of-state businesses that ship citrus trees into Texas. The department can pursue out-of- state businesses, but shortage of funds would severely limit such enforcement.

New §21.8 defines the labeling requirements necessary to track and identify regulated articles; provides for an alternative to the labeling requirement; specifies administrative penalties that apply for non-compliance; and specifies requirements for record keeping to ensure that regulated articles can be easily identified as produced in Texas. New §21.9 specifies requirements for record keeping; provisions for a rebuttable presumption; procedures for rebutting a presumption; and provisions for seizure and destruction of regulated articles.

New §21.8 and §21.9 are adopted in accordance with the Texas Agriculture Code (the Code), §71.009, which provides the department with the authority to adopt rules as necessary for the seizure, treatment, and destruction of plants, plant products, and other substances for the effective enforcement and administration of Chapter 71; and §73.002 which provides for the state to use all constitutional measures to protect the citrus industry from destruction by pests and diseases.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on July 7, 2003.

TRD-200304103

Dolores Alvarado Hibbs

Deputy General Counsel

Texas Department of Agriculture

Effective date: January 1, 2004

Proposal publication date: April 11, 2003

For further information, please call: (512) 463-4075