[Federal Register Volume 59, Number 195 (Tuesday, October 11, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-25052]


[[Page Unknown]]

[Federal Register: October 11, 1994]


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DEPARTMENT OF AGRICULTURE
Agricultural Stabilization and Conservation Service

7 CFR Parts 735, 736, 737, 738, 739, 740, 741, and 742

RIN 0560-AD13

 

U.S. Warehouse Act Fees

AGENCY: Agricultural Stabilization and Conservation Service, USDA.

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: This final rule revises the regulations under the United 
States Warehouse Act (USWA) to increase the fees charged to grain, 
tobacco, wool, dry bean, nut, syrup, cotton and cottonseed warehousemen 
for licensing and inspection services. In addition, a schedule of fees 
has been added to impose annual fees on cotton warehousemen. Future fee 
changes will be announced by a notice in the Federal Register prior to 
July 1, to be effective October 1 of each year, when such changes have 
been determined to be necessary.

EFFECTIVE DATE: October 1, 1994.

FOR FURTHER INFORMATION CONTACT: Director, Licensing Authority 
Division, United States Department of Agriculture (USDA), Agricultural 
Stabilization and Conservation Service (ASCS), PO Box 2415, Washington, 
DC 20013-2415, telephone 202-720-2121, FAX 202-690-0014.

SUPPLEMENTARY INFORMATION:

Executive Order 12866

    This rule has been determined to be significant and was reviewed by 
Office of Management and Budget (OMB) under Executive Order 12866.

Executive Order 12372

    This program is not subject to the provisions of Executive Order 
12372 which requires intergovernmental consultation with State and 
local officials. See the notice related to 7 CFR part 3015, subpart V, 
published at 48 FR 29115 (June 24, 1983).

Executive Order 12778

    The Office of General Counsel has certified to the OMB that these 
regulations meet the applicable standards provided in sections 2(a) and 
2(b)(2) of this Executive Order.

Paperwork Reduction Act

    The amendments set forth in this final rule do not generate any new 
or revised information collection or recordkeeping requirements on the 
public.

Regulatory Flexibility Act

    It has been determined that the Regulatory Flexibility Act is not 
applicable to this final rule. It has been determined that this rule 
will not have a significant effect on a substantial number of small 
businesses because licensing under the USWA is strictly voluntary on 
the part of the warehouseman. The actions taken herein are required by 
statute.

Executive Order 12612

    It has been determined that the policies and procedures contained 
in this rule will not have substantial direct effects on states or 
their political subdivisions, or on the distribution of power and 
responsibilities among the various levels of government.

National Environmental Policy Act

    This action is not expected to have any significant impact on the 
quality of the human environment, health, and safety. Therefore, 
neither an Environmental Assessment nor an Environmental Impact 
Statement is needed.

Background

    Pursuant to the provisions of the USWA, the Secretary has the 
authority to license public warehousemen. Warehousemen that opt to have 
a USWA license understand that fees will be imposed to cover the costs 
of the program. Specifically, the Omnibus Budget Reconciliation Act of 
1981 mandates the imposition of fees for USWA licensed warehouses. The 
Act stipulates that:

    The Secretary of Agriculture * * * shall charge, assess, and 
cause to be collected a reasonable fee for: (1) Each examination or 
inspection of a warehouse * * *; (2) each license issued to any 
person to classify, inspect, grade, sample, or weigh agricultural 
products stored or to be stored * * *; (3) each annual warehouse 
license issued to a warehouseman to conduct a warehouse * * *; and 
(4) each warehouse license amended, modified, extended, or 
reinstated * * *. Such fees shall cover, as nearly as practicable, 
the costs of providing such services and licenses * * * including 
administrative and supervisory costs * * *.

    This final rule adopts and changes the fees charged and collected, 
discontinues publication of fee amounts in the Regulations for 
Warehouses (7 CFR, chapter VII, subchapter C), and provides for fees to 
be adjusted annually in order to cover program costs. Fees assessed in 
fiscal year 1995, are stated in the paragraphs and tables contained 
herein. This fee information was also contained in the proposed rule 
published on May 19, 1994, in the Federal Register at 59 FR 26146. The 
table covering annual fees for cotton, as proposed, has been adjusted 
for warehouses that have a capacity exceeding 160,000 bales.

Warehouse and Service License Fees

    The fee for original issuance, reissuance, or duplication of a 
license for cotton, grain, tobacco, wool, dry beans, nut, syrup, and 
cottonseed is $65 for each license issued.
    The fee charged to license individuals to inspect, sample, grade, 
classify, or weigh commodities is $26 for each service license issued.

Warehouse Annual and Inspection Fees

    These fees are in the following tables by agricultural product. 
Inspection fees are assessed for each original examination or 
inspection, or reexamination or reinspection for modification of an 
existing license. Annual fees are assessed independently of inspection 
fees.

                                 Cotton                                 
                               [In bales]                               
------------------------------------------------------------------------
                                                 Annual fee   Annual fee
                                                  for each     for each 
                                                 warehouse    warehouse 
               Licensed capacity                  location     location 
                                                 with a CCC   without a 
                                                  storage    CCC storage
                                                 agreement    agreement 
------------------------------------------------------------------------
1-20,000......................................         $500       $1,000
20,001-40,000.................................          650        1,300
40,001-60,000.................................          800        1,600
60,001-80,000.................................        1,000        2,000
80,001-100,000................................        1,250        2,500
100,001-120,000...............................        1,500        3,000
120,001-140,000...............................        1,750        3,500
140,001-160,000...............................        2,000        4,000
160,001+......................................       *2,250     **4,500 
------------------------------------------------------------------------
*Plus $50.00 per 5,000 bale capacity above 160,000 bales or fraction    
  thereof.                                                              
**Plus $100.00 per 5,000 bale capacity above 160,000 bales or fraction  
  thereof.                                                              
Inspection fees will be charged at the rate of $65 for each 1,000 bales 
  of licensed capacity, or fraction thereof, but in no case less than   
  $130 nor more than $1,300.                                            


                                 Grain                                  
                              [In bushels]                              
------------------------------------------------------------------------
                                                 Annual fee   Annual fee
                                                  for each     for each 
                                                 warehouse    warehouse 
              Licensed capacity                   location     location 
                                                 with a CCC   without a 
                                                  storage    CCC storage
                                                 agreement    agreement 
------------------------------------------------------------------------
1-150,000.....................................         $130         $260
150,001-250,000...............................          260          520
250,001-500,000...............................          390          780
500,001-750,000...............................          520        1,040
750,001-1,000,000.............................          650        1,300
1,000,001-1,200,000...........................          780        1,560
1,200,001-1,500,000...........................          910        1,820
1,500,001-2,000,000...........................        1,040        2,080
2,000,001-2,500,000...........................        1,170        2,340
2,500,001-5,000,000...........................        1,300        2,600
5,000,001-7,500,000...........................        1,430        2,860
7,500,001-10,000,000..........................        1,560        3,120
10,000,001+...................................       *1,560      **3,120
------------------------------------------------------------------------
*Plus $40 per million bushels above 10,000,000 or fraction thereof.     
**Plus $80 per million bushels above 10,000,000 or fraction thereof.    
Inspection fees will be charged at the rate of $13 for each 10,000      
  bushels or fraction thereof, but in no case less than $130 nor more   
  than $1,300.                                                          


                               Dry Beans                                
                           [In hundredweight]                           
------------------------------------------------------------------------
                     Licensed capacity                        Annual fee
------------------------------------------------------------------------
100-90,000.................................................         $650
90,100-150,000.............................................          910
150,100-300,000............................................        1,170
300,100-450,000............................................        1,430
450,100-600,000............................................        1,690
600,100-720,000............................................        1,950
720,100-900,000............................................        2,210
900,100-1,200,000..........................................        2,470
1,200,100-1,500,000........................................        2,730
1,500,100-3,000,000........................................        2,990
3,000,100+.................................................        3,250
------------------------------------------------------------------------
Inspection fees will be charged at the rate of $13 for each 1,000       
  hundredweight, or fraction thereof, but in no case less than $130 nor 
  more than $650.                                                       


                            Tobacco and Wool                            
                               Annual fee:                              
  $13 for each 100,000 pounds of licensed capacity, or fraction thereof,
   but in no case less than $520 nor more than $2,600.                  
                                                                        
                             Inspection fee:                            
  $13 for each 100,000 pounds of licensed capacity, or fraction thereof,
   but in no case less than $130 nor more than $650.                    
                                                                        


                                  Nuts                                  
                               Annual fee:                              
  13 cents for each short ton of licensed capacity, or fraction thereof,
   but in no case less than $520 nor more than $2,600.                  
                                                                        
                             Inspection fee:                            
  $7 for each 100 short ton of licensed capacity, or fraction thereof,  
   of peanuts, and $13 for each 1,000 hundredweight, or fraction        
   thereof, of other nuts, but in no case less than $130 nor more than  
   $1,300.                                                              
                                                                        


                                 Syrup                                  
                               Annual fee:                              
  $4 for each 5,000 gallons of licensed capacity, or fraction thereof,  
   but in no case less than $520 nor more than $2,600.                  
                             Inspection fee:                            
  $4 for each 5,000 gallons, or fraction thereof, but in no case less   
   than $130 nor more than $650.                                        
                                                                        


                               Cottonseed                               
                               Annual fee:                              
  $13 for each 1,000 short tons of licensed capacity, or fraction       
   thereof, but in no case less than $520 nor more than $2,600.         
                             Inspection fee:                            
  $13 for each 1,000 short tons of licensed capacity, or fraction       
   thereof, but in no case less than $130 nor more than $650.           
                                                                        

General Summary of Comments

    The proposed rule was published in the Federal Register (59 FR 
26146) on May 19, 1994. Comments from interested parties were due on or 
before the close of business on June 3, 1994.
    Twenty-two letters were received on time from entities concerned 
with issues regarding the cotton and grain USWA changes. Because of the 
definite division of the comments between cotton and grain, our 
``Summary of Comments'' will be separated accordingly.
    Seventeen of the 22 letters concern cotton fees, delaying the 
effective date of USWA fee charges, and a maximum limit on fees. The 17 
cotton entities are comprised of nine cotton compressors/ginners, four 
warehousemen, and four Associations. One of the letters from an 
association states that its members support maintaining the integrity 
of the USWA warehouse receipt system, but association policy will not 
allow for constructive comment on the proposal at this time.
    Five of the 22 letters concern grain fee increases and future fee 
announcements. The five entities are comprised of three associations 
and two warehousemen.
    A total of 41 comments were received. Thirty-two of these comments 
concerned cotton, and 9 concerned grain. Discussion of Comments
    Most of the commenters were supportive of the continued need for 
the USWA and of the concepts behind the proposal. However, many of the 
comments suggest that a different approach would be more desirable to 
finance the costs of the program.
    The final rule adopts the proposed fees for grain, tobacco, wool, 
dry bean, nut, syrup, and cottonseed warehouses without change. One 
minor change to the fee proposal regarding cotton has been made. The 
amount of fees collected in warehouses where the capacity exceeds 
160,000 bales, will be subject to incremental increases.

Summary of Comments

Cotton

Fees
    Some degree of confusion exists among the commenters as they refer 
to the federal and State regulation programs and warehouses with a 
Commodity Credit Corporation (CCC) Cotton Storage Agreement as being 
one and the same. Specifically, they believe that all regulatory and 
contractual fees should be announced at the same time. However, these 
three agencies operate under different legislation with different 
authorities. Therefore, these comments are not discussed below in 
detail.
    A total of 11 comments were received regarding fees. One comment 
opposes the warehouse and service license fee increase, as well as the 
annual and inspection fee increases. One comment states that it is 
assumed that warehousemen who are currently licensed would be 
grandfathered into this fee structure and would be opposed to any new 
assessment of fees to cover the cost of existing licensed space. One 
comment strongly opposes the implementation of user fees for cotton, 
stating that it is a new taxation. One comment understands the need for 
fees; but believes fees should be based on an hourly rate of actual 
time spent. The commenter feels that if the main purpose is to cover an 
inspector's expenses, that it would be more appropriate than using the 
bale capacity as the basis. One comment states that the proposed fees 
are far greater than any suggested at recent meetings. The commenter 
feels that omission of any inspection fees for State licensed 
warehouses is discriminatory. One comment states that the proposed fees 
are much too high, and that ASCS should lock in any fee for at least 
five years. One comment states that user fees are not opposed, but that 
the fee schedule in the Federal Register discriminates against small 
warehouses. One comment states that the importance of the examination 
system is questioned. When examiners logged in each bale and knew what 
was missing, the audit provided valuable information. The commenter 
feels that if a bale by bale check was still done it would be useful 
and that he would be glad to pay the fees for the service. One comment 
supports the need for inspection fees, but believes we should consider 
a freeze on the level of fees for a specific time, say five years, on 
the basis that escalations should not be needed in the near term. One 
comment opposes the proposed fees. The commenter feels that the fees 
are too much, too soon, and if fees are a must, they should be phased 
in over not less than a 3-year period. One comment states that there is 
reluctant concurrence with the imposition of fees, but that they fully 
support the need for inspection fees to be imposed for cotton.
    After consideration of these comments, ASCS decided to proceed with 
the implementation of fees on USWA licensed cotton warehousemen. To 
cancel or delay such fees would not be in accordance with the statutory 
requirements to collect fees for services. Since the USWA licensing 
authority has no control over, or influence on, State regulatory 
agencies or CCC, it is not feasible to announce all such fees at the 
same time. The CCC contractual year is not the same as the USDA fiscal 
year. The State authority has no connection with the USWA programs.

Delaying Effective Date of USWA Fee Charges

    A total of 10 comments were received regarding the effective date. 
Nine commenters feel that all cotton warehouses, including state 
licensed and CCC warehousemen, should be treated equitably in the 
timing of fee announcements. One comment, from a grain association, 
fully supports the proposal for cotton warehouses to pay their fair 
share of the costs of the federal warehouse system.
    After consideration, ASCS decided it could not change the manner in 
which the initial annual fees would be assessed for cotton warehouses.

Maximum Limit on Fees

    A total of 11 comments were received regarding caps on fees. Nine 
commenters state that they oppose the 160,000 cap on charges because 
some warehouses are larger, and that the cap would be discriminatory to 
the smaller capacity warehouses. One comment opposes the cap on 
capacity because there are additional expenses inspecting large 
warehouses and they should be charged accordingly. One comment also 
opposes the cap and feels that fees should be escalated without regard 
to an arbitrary cap.
    After consideration of these comments, ASCS decided to remove the 
cap of 160,000 bales of capacity for cotton warehouses by adding an 
incremental increase with no cap.

Grain

Fee Increases
    A total of five comments were received regarding the fee increase. 
All five commenters oppose the increase at this time and recommend 
deferring it until ASCS takes steps to streamline the program and cut 
costs.
    After consideration of these comments, ASCS decided to go ahead 
with increases as proposed. To cancel or delay this increase would 
result in a major decrease in the services provided, and therefore the 
integrity of the USWA. Future Fee Announcements
    A total of four comments were received regarding future fee 
announcements. All four commenters oppose changing the fee setting 
process and eliminating advance public notice and comment.
    These comments were considered, however, it was determined that the 
proposed system is necessary and will be implemented. The regulatory 
process of writing, clearing, and publishing proposed and final rules 
in the Federal Register takes, on the average, nine to twelve months. 
By removing the fees from the regulatory process, ASCS is able to 
respond in a timely manner and make necessary fee adjustments.

List of Subjects in 7 CFR Parts 735, 736, 737, 738, 739, 740, 741, and 
742

    Administrative practice and procedure, agricultural commodities, 
Reporting and recordkeeping requirements, Surety bonds, Warehouses.

    Accordingly, 7 CFR parts 735 through 742 be amended as follows:

PART 735--COTTON WAREHOUSES

PART 736--GRAIN WAREHOUSES

PART 737--TOBACCO WAREHOUSES

PART 738--WOOL WAREHOUSES

PART 739--DRY BEAN WAREHOUSES

PART 740--NUT WAREHOUSES

PART 741--SIRUP WAREHOUSES

PART 742--COTTONSEED WAREHOUSES

    1. The authority citation for 7 CFR parts 735, 736, 737, 738, 739, 
740, 741, and 742 is revised to read as follows:

    Authority: 7 U.S.C. 241 et seq.

    2. Sections 735.50, 736.57, 737.48, 738.46, 739.55, 740.56, 741.48, 
and 742.58 are revised to read as follows:


Sec. ____________  License fees.

    (a) Fees are collected in advance for each original, amended, 
modified, extended, reinstated, or duplicate warehouseman's license; 
and for each original, duplicate, or modified license issued to 
inspect, sample, grade, classify, or weigh commodities.
    (b) Fee changes, if applicable, will be announced by Notice in the 
Federal Register on or before July 1, and effective the following 
October 1.
    3. Sections 735.51, 736.58, 737.49, 738.47, 739.56, 740.57, 741.49, 
and 742.59 are revised to read as follows:


Sec. ____________  Warehouse annual and inspection fees.

    Warehousemen must pay:
    (a) An annual fee which will be determined by computing the 
capacity for each warehouse location under a single license and adding 
those amounts together to determine the total due. The fee will be 
assessed and payable when the warehouse bond is furnished in accordance 
with these regulations, for acceptance by the Secretary and annually 
thereafter on the bond renewal date. The capacity for each identifiable 
location will be determined by the Secretary. The total capacity of all 
locations may not exceed the capacity stated in the current license. An 
identifiable location is a fully functional public warehouse as 
determined by the Secretary. The annual fee a licensed warehouseman is 
assessed may be adjusted by the amount Commodity Credit Corporation 
(CCC) pays, if CCC has a storage contract or agreement with the 
warehouseman.
    (b) An inspection fee for each original and amendment inspection.
    (c) An inspection fee at the rate of 100 percent of the annual fee 
charged warehouses without a CCC storage contract or agreement, in all 
cases where the license has been suspended and the warehouseman has 
requested reinstatement. No fee will be charged if the Secretary 
determines that the suspension was not justified.
    (d) A fee for each inspection requested by the warehouseman at the 
rate of 100 percent of the annual fee charged warehouses without a CCC 
storage contract or agreement.

    Signed at Washington, DC, on October 4, 1994.
Bruce R. Weber,
Acting Administrator, Agricultural Stabilization and Conservation 
Service.
[FR Doc. 94-25052 Filed 10-7-94; 8:45 am]
BILLING CODE 3410-05-P