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Rule

Fees for Official Inspection and Official Weighing Services

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Information about this document as published in the Federal Register.

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AGENCY:

Grain Inspection, Packers and Stockyards Administration, USDA.

ACTION:

Final rule.

SUMMARY:

The Federal Grain Inspection Service (FGIS) of the Grain Inspection, Packers and Stockyards Administration (GIPSA) is increasing certain fees by approximately 4.6 percent; i.e., contract and non-contract hourly rates, certain unit rates, and the administrative tonnage fee. These fees apply only to official inspection and weighing services performed by GIPSA in the United States under the United States Grain Standards Act (USGSA), as amended. These increases are needed to cover increased operational costs resulting from the approximate 4.6 percent January 2002 Federal pay increase. GIPSA anticipates the increase in the user fees will generate approximately $703,000 in additional revenue.

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EFFECTIVE DATE:

April 22, 2002.

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FOR FURTHER INFORMATION CONTACT:

David Orr, Director, Field Management Division, at his E-mail address: Dorr@gipsadc.usda.gov, or telephone him at (202) 720-0228.

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SUPPLEMENTARY INFORMATION:

Executive Order 12866, Regulatory Flexibility Act, and the Paperwork Reduction Act

This rule has been determined to be nonsignificant for the purpose of Executive Order 12866 and, therefore, has not been reviewed by the Office of Management and Budget.

Also, pursuant to the requirements set forth in the Regulatory Flexibility Act, it has been determined that this final rule will not have a significant economic impact on a substantial number of small entities as defined in the Regulatory Flexibility Act (5 U.S.C. 601 et seq.).

GIPSA regularly reviews its user-fee-financed programs to determine if the fees are adequate. GIPSA has and will continue to seek out cost saving opportunities and implement appropriate changes to reduce costs. Such actions can provide alternatives to fee increases. However, even with these efforts, GIPSA's existing fee schedule will not generate sufficient revenues to cover program costs while maintaining an adequate reserve balance. Retained earnings balances are adjusted to reflect prior year revenue and obligations realized in the year reported. In FY 1999, GIPSA's operating costs were $23,176,643 with revenue of $22,971,204, resulting in a negative margin of $205,440. In FY 2000, GIPSA's operating costs were $24,146,428 with revenue of $23,150,188 that resulted in a negative margin of $996,240 and a negative reserve balance of $938,147. GIPSA's FY 2001 operating costs were $25,670,126 with revenue of $23,977,240 that resulted in a negative margin of $1,692,886. Using the most current financial data available for FY 2002, December 2001, GIPSA's operating costs were $6,923,247 with revenue of $7,131,883 that resulted in a positive margin of $208,247. However, the current reserve negative balance of $2,882,270 is well below the desired 3-month reserve of approximately $6 million. Employee salaries and benefits are major program costs that account for approximately 84 percent of GIPSA's total operating budget. The approximate general and locality salary increase averages 4.6 percent for GIPSA employees, effective January 2002, will increase GIPSA's costs by approximately $703,000.

GIPSA has reviewed the financial position of the inspection and weighing program based on the increased salary and benefit costs, along with the revised projected FY 2002 workload of 79 million metric tons. Based on the review, GIPSA has concluded that the approximate 4.6 percent salary increase will have to be recovered through increases in fees.

The fee increase primarily applies to entities engaged in the export of grain. Under the provisions of the USGSA, grain exported from the United States must be officially inspected and weighed. Mandatory inspection and weighing services are provided by GIPSA on a fee basis at 32 export facilities. All of these facilities are owned and managed by multi-national corporations, large cooperatives, or public entities that do not meet the criteria for small entities established by the Small Business Administration.

Some entities that request nonmandatory official inspection and weighing services at other than export locations could be considered small entities. The impact on these small businesses is similar to any other business; that is, an average 4.6 percent increase in the cost of official inspection and weighing services. This increase should not significantly affect any business requesting official inspection and weighing services. Furthermore, any of these small businesses that wish to avoid the fee increase may elect to do so by using an alternative source for inspection and weighing services. Such a decision should not prevent the business from marketing its products.

There would be no additional reporting or recordkeeping requirements imposed by this action. In compliance with the Paperwork Reduction Act of 1995 (44 U.S.C. Chapter 35), the information collection and recordkeeping requirements in Part 800 have been previously approved by the Office of Management and Budget under control number 0580-0013. GIPSA has not identified any other Federal rules which may duplicate, overlap, or conflict with this final rule.

Executive Order 12988

This final rule has been reviewed under Executive Order 12988, Civil Justice Reform. This action is not intended to have a retroactive effect. The USGSA provides in § 87g that no subdivision may require or impose any requirements or restrictions concerning the inspection, weighing, or description of grain under the Act. Otherwise, this final rule will not preempt any State or local laws, regulations, or policies unless they present irreconcilable conflict with this final rule. There are no administrative procedures that must be exhausted prior to any judicial challenge to the provisions of this final rule.

Background

On January 2, 2002, GIPSA proposed in the Federal Register (67FR25) to increase fees for official inspection and weighing services performed under the USGSA (7 U.S.C. 71 et seq.) by approximately 4.6 percent. The USGSA authorizes GIPSA to provide official grain inspection and weighing services and to charge and collect reasonable fees for performing these services. The fees collected are to cover, as nearly as practicable, GIPSA's costs for performing these services, including related administrative and supervisory costs. The current USGSA fees were published in the Federal Register on July 9, 2001 (66 FR 35751), and became effective on August 8, 2001. GIPSA regularly reviews its user-fee-financed programs to determine if the fees are adequate. GIPSA has and will continue to seek out cost-saving opportunities and implement appropriate changes to reduce costs. Such actions can provide alternatives to fee increases. However, even with these efforts, GIPSA's existing fee schedule will not generate sufficient revenues to cover program costs while maintaining an adequate reserve balance. Retained earnings balances are adjusted to reflect prior year revenue and obligations realized in the year reported. In FY 1999, GIPSA's operating costs were $23,176,643 with revenue of $22,971,204, resulting in a negative margin of $205,440. In FY 2000, GIPSA's operating costs were $24,146,428 with revenue of $23,150,188 that resulted in a negative margin of $996,240 and a negative reserve balance of $938,147. GIPSA's FY 2001 operating costs were $25,670,126 with revenue of $23,977,240 that resulted in a negative margin of $1,692,886. Using the most current financial data available for FY 2002, December 2001, GIPSA's operating costs were $6,923,247 with revenue of $7,131,883 that resulted in a positive margin of $208,247. However, the current reserve negative balance of $2,882,270 is well below the desired 3-month reserve of approximately $6 million. Employee salaries and benefits costs, which account for approximately 84 percent of GIPSA's total operating budget, have risen significantly over the years. GIPSA's average cost per hour in FY 1996 was $20.83 and has risen to $26.60 in FY 2001, a 27.7 percent Start Printed Page 13086increase. Since FY 1996, GIPSA has increased fees six times to recover the Congressionally mandated salary increases each year as well as other pay and benefit increases such as longevity pay. The six fee increases have raised fees by approximately 22 percent over the FY 1996 levels.

While individual salary and benefit costs have increased since 1996, GIPSA has reduced overall salary and benefits costs by 12.8 percent through greater utilization of part-time and intermittent employees and improved program efficiencies. GIPSA has also reduced non-employee costs such as rent, utilities, and Departmental overhead by 1.4 percent.

The January 2002 salary increase averaged 4.6 percent for GIPSA employees, which equates to an estimated $703,000 increase. GIPSA has reviewed the financial position of the inspection and weighing program and concluded that fee increases are necessary to recover the estimated $703,000 increase in program costs. An average increase of 4.6 percent to hourly, certain unit fees, and the administrative tonnage fee is needed.

The current hourly fees are:

Monday to Friday (6 a.m. to 6 p.m.)Monday to Friday (6 p.m. to 6 a.m.)Saturday, Sunday, and OvertimeHolidays
1-year contract$27.40$29.80$38.60$46.40
6-month contract30.2032.0041.0053.00
3-month contract34.4035.6044.6055.40
Non-contract40.0042.0051.0062.60

GIPSA has also identified certain unit fees, for services not performed at an applicant's facility, which contain direct labor costs and require a fee increase. Further, GIPSA has identified those costs associated with salaries and benefits that are covered by the administrative metric tonnage fee. The 4.6 percent cost-of-living increase to salaries and benefits covered by the administrative tonnage fee results in an overall increase of an average of 4.6 percent to the administrative tonnage fee.

Comment Review

GIPSA received 1 comment during the 30-day comment period from a grain trade association. The trade association stated that it consists of 1,000 grain, feed, processing, and grain-related companies, 70 percent of which are small entities. The commentor did not support the proposed rule. A summary of the comment and GIPSA's response is as follows:

The commentor opposed the fee increase and suggested that the proposed fee increase be offset through improved operating efficiencies and additional reductions in overhead. In addition, the commentor suggested GIPSA aggressively seek ways to reduce direct employee expenses through increased automation and contracting for official services so future mandated Federal pay increases will have less impact on the cost of providing official services. The commentor also stated that the agency should determine what programs could be terminated, scaled back, or consolidated to reduce administrative overhead.

The USGSA requires GIPSA to maintain a workforce of sufficient size and experience to meet the inspection and weighing needs of its applicants. GIPSA views its employees as valuable resources that facilitate the marketing of grain. Whenever possible, GIPSA has replaced vacant full-time permanent positions with part-time and intermittent employees to reduce administrative overhead costs related to employee salaries and benefits. Since FY 1996, GIPSA has decreased headquarters paid hours of overhead by 14.44 percent and other obligations by 1.4 percent. However, these reductions have not been enough to offset the increases in salaries and benefits. Further, GIPSA is constantly reviewing the inspection and weighing programs to assess service delivery and demand. Whenever, possible, available employees are used for temporary duty assignments within other Federal programs to further reduce administrative overhead costs. This action allows GIPSA the ability to temporarily downsize while maintaining an experienced workforce available for duty when service demands increase. GIPSA is continuing to review the issue of contracting for official services when appropriate. Efforts to contain and reduce costs have and will continue to be a high priority issue with GIPSA. GIPSA has and will continue to take action to reduce inspection and weighing costs whenever possible.

Final Action

Accordingly, GIPSA is applying an approximate 4.6 percent increase to certain hourly rates, certain unit rates, and the administrative tonnage fee, as proposed in 7 CFR 800.71: Table 1-Fees for Official Services Performed at an Applicant's Facility in an Onsite FGIS Laboratory; Table 2-Services Performed at Other Than an Applicant's Facility in an FGIS Laboratory; and Table 3, Miscellaneous Services.

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List of Subjects in 7 CFR Part 800

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For the reasons set out in the preamble,

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PART 800—GENERAL REGULATIONS

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1. The authority citation for part 800 continues to read as follows:

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Authority: Pub. L. 94-582, 90 Stat. 2867, as amended (7 U.S.C. 71 et seq.)

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2. Section 800.71 is amended by revising Schedule A in paragraph (a) to read as follows:

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Fees assessed by the Service.

(a) * * *

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Schedule A.—Fees for Official Inspection and Weighing Services Performed in the United States

Table 1.—Fees for Official Services Performed at an Applicant's Facility in an Onsite FGIS Laboratory1

Monday to Friday (6 a.m. to 6 p.m.)Monday to Friday (6 p.m. to 6 a.m.)Saturday, Sunday, and overtime2Holidays
(1) Inspection and Weighing Services Hourly Rates (per service representative)
1-year contract$28.60$31.20$40.40$48.60
6-month contract31.6033.4042.8056.00
3-month contract36.0037.2046.6058.00
Non-contract41.8044.0053.4065.40
(2) Additional Tests (cost per test, assessed in addition to the hourly rate)3
(i) Aflatoxin (other than Thin Layer Chromatography)$8.50
(ii) Aflatoxin (Thin Layer Chromatography method)20.00
(iii) Corn oil, protein, and starch (one or any combination)1.50
(iv) Soybean protein and oil (one or both)1.50
(v) Wheat protein (per test)1.50
(vi) Sunflower oil (per test)1.50
(vii) Vomitoxin (qualitative)12.50
(viii) Vomitoxin (quantitative)18.50
(ix) Waxy corn (per test)1.50
(x) Fees for other tests not listed above will be based on the lowest noncontract hourly rate.
(xi) Other services
(a) Class Y Weighing (per carrier)
(1) Truck/container.30
(2) Railcar1.25
(3) Barge2.50
(3) Administrative Fee (assessed in addition to all other applicable fees, only one administrative fee will be assessed when inspection and weighing services are performed on the same carrier).
(i) All outbound carriers (per-metric-ton)4
(a) 1-1,000,000$0.1152
(b) 1,000,001-1,500,0000.1051
(c) 1,500,001-2,000,0000.0568
(d) 2,000,001-5,000,0000.0420
(e) 5,000,001-7,000,0000.0230
(f) 7,000,001 +0.0105
1 Fees apply to original inspection and weighing, reinspection, and appeal inspection service and include, but are not limited to, sampling, grading, weighing, prior to loading stowage examinations, and certifying results performed within 25 miles of an employee's assigned duty station. Travel and related expenses will be charged for service outside 25 miles as found in § 800.72 (a).
2 Overtime rates will be assessed for all hours in excess of 8 consecutive hours that result from an applicant scheduling or requesting service beyond 8 hours, or if requests for additional shifts exceed existing staffing.
3 Appeal and reinspection services will be assessed the same fee as the original inspection service.
4 The administrative fee is assessed on an accumulated basis beginning at the start of the Service's fiscal year (October 1 each year).

Table 2.—Services Performed at Other Than an Applicant's Facility in an FGIS Laboratory12

(1) Original Inspection and Weighing (Class X) Services
(i) Sampling only (use hourly rates from Table 1)
(ii) Stationary lots (sampling, grade/factor, & checkloading)
(a) Truck/trailer/container (per carrier)$19.25
(b) Railcar (per carrier)28.90
(c) Barge (per carrier)185.00
(d) Sacked grain (per hour per service representative plus an administrative fee per hundredweight) (CWT)0.02
(iii) Lots sampled online during loading (sampling charge under (i) above, plus):
(a) Truck/trailer container (per carrier)9.95
(b) Railcar (per carrier)19.25
(c) Barge (per carrier)110.00
(d) Sacked grain (per hour per service representative plus an administrative fee per hundredweight) (CWT)0.02
(iv) Other services
(a) Submitted sample (per sample—grade and factor)11.50
(b) Warehouseman inspection (per sample)19.50
(c) Factor only (per factor—maximum 2 factors)5.15
(d) Checkloading/condition examination (use hourly rates from Table 1, plus an administrative fee per hundredweight if not previously assessed) (CWT)0.02
(e) Reinspection (grade and factor only. Sampling service additional, item (i) above)12.80
(f) Class X Weighing (per hour per service representative)55.00
(v) Additional tests (excludes sampling)
(a) Aflatoxin (per test—other than TLC method)29.00
(b) Aflatoxin (per test—TLC method)110.00
(c) Corn oil, protein, and starch (one or any combination)8.80
(d) Soybean protein and oil (one or both)8.80
(e) Wheat protein (per test)8.80
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(f) Sunflower oil (per test)8.80
(g) Vomitoxin (qualitative)30.50
(h) Vomitoxin (quantitative)37.50
(i) Waxy corn (per test)10.00
(j) Canola (per test—00 dip test)10.00
(k) Pesticide Residue Testing3
(1) Routine Compounds (per sample)210.00
(2) Special Compounds (per service representative)110.00
(l) Fees for other tests not listed above will be based on the lowest noncontract hourly rate from Table 1.
(2) Appeal inspection and review of weighing service.4
(i) Board Appeals and Appeals (grade and factor)79.50
(a) Factor only (per factor—max 2 factors)41.80
(b) Sampling service for Appeals additional (hourly rates from Table 1)
(ii) Additional tests (assessed in addition to all other applicable fees)
(a) Aflatoxin (per test, other than TLC)29.50
(b) Aflatoxin (TLC)118.00
(c) Corn oil, protein, and starch (one or any combination)16.80
(d) Soybean protein and oil (one or both)16.80
(e) Wheat protein (per test)16.80
(f) Sunflower oil (per test)16.80
(g) Vomitoxin (per test—qualitative)40.00
(h) Vomitoxin (per test—quantitative)45.00
(i) Vomitoxin (per test—HPLC Board Appeal)136.00
(j) Pesticide Residue Testing3
(1) Routine Compounds (per sample)210.00
(2) Special Compounds (per service representative)110.00
(k) Fees for other tests not listed above will be based on the lowest noncontract hourly rate from Table 1.
(iii) Review of weighing (per hour per service representative)79.20
(3) Stowage examination (service-on-request)3
(i) Ship (per stowage space)51.00
(Minimum $255.00 per ship)
(ii) Subsequent ship examinations (same as original) (Minimum $153.00 per ship)
(iii) Barge (per examination)41.00
(iv) All other carriers (per examination)16.00
1 Fees apply to original inspection and weighing, reinspection, and appeal inspection service and include, but are not limited to, sampling, grading, weighing, prior to loading stowage examinations, and certifying results performed within 25 miles of an employee's assigned duty station. Travel and related expenses will be charged for service outside 25 miles as found in § 800.72 (a).
2 An additional charge will be assessed when the revenue from the services in Schedule A, Table 2, does not cover what would have been collected at the applicable hourly rate as provided in § 800.72 (b).
3 If performed outside of normal business, 1-1/2 times the applicable unit fee will be charged.
4 If, at the request of the Service, a file sample is located and forwarded by the Agency for an official agency, the Agency may, upon request, be reimbursed at the rate of $2.50 per sample by the Service.

Table 3.—Miscellaneous Services1

(1) Grain grading seminars (per hour per $55.00 service representative)2$55.00
(2) Certification of diverter-type mechanical samplers (per hour per service representative)255.00
(3) Special weighing services (per hour per service representative)2
(i) Scale testing and certification55.00
(ii) Evaluation of weighing and material handling systems55.00
(iii) NTEP Prototype evaluation (other than Railroad Track Scales)55.00
(iv) NTEP Prototype evaluation of Railroad Track55.00
Scales (plus usage fee per day for test car)110.00
(v) Mass standards calibration and reverification55.00
(vi) Special projects55.00
(4) Foreign travel (per day per service representative)490.00
(5) Online customized data EGIS service
(i) One data file per week for 1 year500.00
(ii) One data file per month for 1 year300.00
(6) Samples provided to interested parties (per sample)2.60
(7) Divided-lot certificates (per certificate)1.50
(8) Extra copies of certificates (per certificate)1.50
(9) Faxing (per page)1.50
(10) Special mailing (actual cost)
(11) Preparing certificates onsite or during other than normal business hours (use hourly rates from Table 1)
1 Any requested service that is not listed will be performed at $55.00 per hour.
2 Regular business hours-Monday through Friday-service provided at other than regular hours charged at the applicable overtime hourly rate.
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Gerald E. Grinnell,

Acting Administrator, Grain Inspection, Packers and Stockyards Administration.

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[FR Doc. 02-6835 Filed 3-20-02; 8:45 am]

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