[Federal Register Volume 63, Number 246 (Wednesday, December 23, 1998)]
[Rules and Regulations]
[Pages 70990-70994]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-33921]


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DEPARTMENT OF AGRICULTURE

Grain Inspection, Packers and Stockyards Administration

7 CFR Part 800

RIN 0580-AA66


Fees for Official Inspection and Weighing Services

AGENCY: Grain Inspection, Packers and Stockyards Administration, USDA.

ACTION: Final rule.

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SUMMARY: The Grain Inspection, Packers and Stockyards Administration 
(GIPSA) is increasing fees for certain official inspection and weighing 
services it performs in the United States under the U.S. Grain 
Standards Act. This action is needed to recover increased operational 
costs resulting from the average 3.6 percent January 1999 cost-of-
living increase to Federal salaries. The ``average 3.6 percent 
increase'' is a combination of a 3.1 percent across-the-board increase 
and increases in locality pay rates for Federal salaries. An average 
3.6 percent increase is implemented for all hourly rates and certain 
unit rates on tests performed at both an applicant's facility and other 
than an applicant's facility. In addition, an average increase of 1.2 
percent is implemented to recover the salary and benefits portion of 
the administrative tonnage fee.

EFFECTIVE DATE: February 1, 1999.

FOR FURTHER INFORMATION CONTACT: George Wollam, USDA, GIPSA, ART, 1400 
Independence Avenue, SW, Stop 3649, Washington, DC 20250-3649, or 
telephone (202) 720-0292.

SUPPLEMENTARY INFORMATION:

Executive Order 12866

    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.

Executive Order 12988

    This 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 Sec. 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 rule 
will not preempt any State or local laws, regulations, or policies 
unless they present irreconcilable conflict with this rule. There are 
no administrative procedures which must be exhausted prior to any 
judicial challenge to the provisions of this final rule.

Effects on Small Entities

    James R. Baker, Administrator, GIPSA, has 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.). Most users of GIPSA inspection and weighing 
services do not meet the requirements for small entities. GIPSA is 
required by statute to make services available and to recover costs of 
providing such services, as nearly as practicable.
    These fee revisions are primarily applicable to entities engaged in 
the export of grain. Under provisions of the USGSA, most grain exported 
from U.S. export port locations must be officially inspected and 
weighed. Mandatory inspection and weighing services are provided by 
GIPSA on a fee basis at 37 export facilities. All of the export 
facilities are owned and managed by multi-national corporations, large 
cooperatives, or public entities that do not meet the criteria for 
small entities as defined under the Regulatory Flexibility Act and the 
regulations issued thereunder. Some users of the service who request 
non-mandatory official inspection and weighing services (most of which 
represent appeals) at other than export locations could be considered 
small entities. However, these fee increases merely reflect the cost-
of-living increases in Federal salaries for hourly, certain unit fees, 
and

[[Page 70991]]

that portion of the administrative tonnage fee.
    In fiscal year 1998, GIPSA's obligations were $23,021,166 with 
revenue of $21,776,323, resulting in a loss of $1,244,843 and retained 
earnings of $55,862. GIPSA cannot absorb the approximate 3.6 percent 
increase in salary costs with the existing retained earnings. 
Additionally, GIPSA will continue to monitor its costs to improve 
operating efficiencies, and adopt cost saving measures, where possible 
and practicable.
    The increase in fees will not have a significant impact on either 
small or large entities. GIPSA estimates an annual increase of $500,000 
in revenue based on a work volume of 72,491,134 metric tons, the 
equivalent to fiscal year 1998.

Information Collection and Recordkeeping Requirements

    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.

Background

    On October 2, 1998, GIPSA published in the Federal Register (63 FR 
52987) a proposal to increase certain fees it charges under the USGSA. 
The USGSA requires GIPSA to charge and collect reasonable fees for 
performing official inspection and weighing services. The fees are to 
cover, as nearly as practicable, GIPSA's costs for performing these 
services, including related administrative and supervisory costs.
    The fee increases generate the additional revenue required to 
recover operational costs created by a January 1999 cost-of-living 
increase in Federal salaries. The average salary increase for GIPSA 
employees in calendar year 1999 is approximately 3.6 percent. This 
action is being taken to ensure that the service fees charged by GIPSA 
generate adequate revenue to cover the additional costs created by the 
January 1999 Federal salary increase.
    The previous USGSA fees were published in the Federal Register on 
June 16, 1998 (63 FR 32713), and became effective on July 1, 1998. In 
addition, GIPSA published a revised fee schedule on June 30, 1998 (63 
FR 35502), effective July 1, 1998, to establish fees for corn oil, 
protein, and starch testing services. The hourly fees covered by this 
rule will generate revenue to cover the basic salary, benefits, and 
leave for those employees providing direct service delivery. The 
current hourly fees are:

 
----------------------------------------------------------------------------------------------------------------
                                                     Monday to       Monday to       Saturday,
                                                  Friday (6 a.m.  Friday (6 p.m.    Sunday, and      Holidays
                                                    to 6 p.m.)      to 6 a.m.)       overtime
----------------------------------------------------------------------------------------------------------------
1-year contract.................................          $24.40          $26.40          $34.40          $41.40
6-month contract................................           26.80           28.60           36.60           47.80
3-month contract................................           30.60           31.60           39.80           49.40
Noncontract.....................................           35.40           37.40           45.40           55.80
----------------------------------------------------------------------------------------------------------------

    GIPSA has also identified certain unit fees, for services not 
performed at an applicant's facility, that contain direct labor costs. 
Further, GIPSA has identified those costs associated with salaries and 
benefits that are covered by the administrative metric tonnage fee. The 
3.6 percent cost-of-living increase to salaries and benefits covered by 
the administrative tonnage fee results in an average overall increase 
of an average of 1.2 percent to the administrative tonnage fee. Other 
associated costs, including non-salary related overhead, are collected 
through the fees contained in the fee schedule and are not included 
under this rule.
    The amount of revenue collected as a result of this rule is a 
direct function of the work volume. GIPSA estimates an increase of 
$500,000 in revenue based on a work volume of 72,491,134 metric tons, 
the equivalent to fiscal year 1998. If GIPSA foregoes this adjustment, 
GIPSA will incur a net loss equivalent to approximately the 3.6 percent 
increase in salaries for every hour paid to an employee.
    In fiscal year 1998, GIPSA's obligations were $23,021,166 with 
revenue of $21,776,323, resulting in a loss of $1,244,843 and retained 
earnings of $55,862. GIPSA cannot afford to absorb an additional 
$500,000 loss due to the approximate 3.6 percent increase in salary 
costs with the existing deficit in retained earnings. Additionally, 
GIPSA will continue to monitor its costs to improve operating 
efficiencies, and adopt cost saving measures, where possible and 
practicable.

Comment Review

    GIPSA received four comments during the 60-day comment period. All 
four were in opposition to the fee increase. Two comments were from 
grain trade associations representing grain, feed and processing 
companies: one commented that it is not correct to conclude that cost 
of living increases in Federal salaries should be automatically passed 
on to users of the official system. This comment went on to state that 
the 3.6 percent increase in Federal salaries was an average increase 
nationally (national average cost-of-living adjustments with local pay 
differentials) and questioned whether the Agency would reach a 3.6 
percent increase in salaries at export locations. The second comment 
opposed the proposed fee increase because the increase represented a 
continuation in the escalation of the cost of official services and 
because GIPSA was simply passing on increased costs to users of the 
official system without first relying on cost saving measures and 
improved efficiencies to offset the anticipated increase in Federal 
salaries. The comment stated that the impact of the increase would be 
felt primarily by exporters and that the fee increase would raise the 
cost of exporting U.S. grains and oilseeds. Both comments stressed that 
a variety of cost savings measures and other efficiencies should be 
undertaken by GIPSA, including terminating, reducing or consolidating 
current programs; continuing to reduce staff; accelerating efforts to 
automate official services; seeking ways to introduce more flexible 
work rules for official personnel; improving the quality and 
consistency of its services; and allocating more costs to others in the 
grain and oilseed sector that derive benefits from the official system.
    Two comments were from individuals not associated with the grain 
industry. They commented that government's involvement in agriculture 
adds to the

[[Page 70992]]

cost for agriculture operations. The comments went on to say that the 
increase in Federal salaries should not be paid for by the proposed fee 
increase, but should be created from sources of funds within the 
federal program. Some suggestions given were a reduction in force, 
reduction in travel and/or training, and reduction in procurement of 
major items.
    GIPSA is required by the USGSA to recover its costs for providing 
inspection and weighing services by establishing reasonable fees to 
cover their estimated costs. The projection of a 3.6 percent increase 
in federal salaries is a national average of all salary and benefit 
increases. The ``average 3.6 percent increase'' is a combination of a 
3.1 percent across-the-board increase and increases in locality pay 
rates for Federal salaries. This average represents a fair and 
reasonable percentage that is consistent with the provisions of the 
USGSA concerning the establishment of fees. Further, GIPSA has 
conducted numerous cost saving measures in the past few years, early 
retirements, field office consolidations, and reduction in travel and 
training. GIPSA will continue to monitor its costs to improve operating 
efficiencies, and adopt cost saving measures, where possible and 
practicable. Absorbing the approximate 3.6 percent salary increase is 
impractical considering the extremely low retained earnings of $55,862. 
Savings derived from further efficiencies will be used to rebuild the 
retained earnings to a 3-month operating reserve or an estimated $5.7 
million.

Final Action

    GIPSA is applying an approximate 3.6 percent increase to those 
hourly rates, certain unit rates, and an average 1.2 percent increase 
to the administrative tonnage fee in 7 CFR 800.71, Table 1--Fees for 
Official Services Performed at an Applicant's Facility in an Onsite 
GIPSA Laboratory; Table 2--Services Performed at Other Than an 
Applicant's Facility in a GIPSA Laboratory; and Table 3, Miscellaneous 
Services.
    In reviewing the fee schedule to identify fees that will require an 
approximate 3.6 percent increase, GIPSA has identified several fees 
that, under the current fee schedule, are at levels that will not 
require any change. Accordingly, these fees will remain the same at 
this time.

List of Subjects in 7 CFR Part 800

    Administrative practice and procedure, Grain.

    For the reasons set out in the preamble, 7 CFR Part 800 is amended 
as follows:

PART 800--GENERAL REGULATIONS

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

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

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


Sec. 800.71  Fees assessed by the Service.

    (a) * * *

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 Laboratory \1\
 
                                                     Monday to       Monday to       Saturday,
                                                   Friday (6 a.m  Friday (6 p.m.    Sunday, and      Holidays
                                                    to 6 p.m.)      to 6 a.m.)     overtime \2\
 
  (1) Inspection and Weighing Services Hourly Rates (per service representative)
 
1-year contract.................................          $25.20          $27.20          $35.40          $42.60
6-month contract................................           27.60           29.40           37.60           49.40
3-month contract................................           31.60           32.60           41.00           51.00
Noncontract.....................................           36.60           38.60           46.80           57.60
 


  (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)...........................            7.50
(viii) Vomitoxin (quantitative).........................           12.50
(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) Railcar.....................................            1.25
        (3) Barge.......................................            2.50
 
  (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.....................................         $0.1014
    (b) 1,000,001-1,500,000.............................          0.0925
    (c) 1,500,001-2,000,000.............................          0.0500
    (d) 2,000,001-5,000,000.............................          0.0370
    (e) 5,000,001-7,000,000.............................          0.0200
    (f) 7,000,000-......................................         0.0090
 
\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 Sec.  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).


[[Page 70993]]


Table 2.--Services Performed at Other than an Applicant's Facility in an
                         FGIS Laboratory \1\ \2\
 
 
(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).......          $18.10
        (b) Railcar (per carrier).......................           27.60
        (c) Barge (per carrier).........................          174.35
        (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).......            9.85
        (b) Railcar (per carrier).......................           19.10
        (c) Barge (per carrier).........................          108.10
        (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)........................................           10.60
        (b) Warehouseman inspection (per sample)........           17.60
        (c) Factor only (per factor--maximum 2 factors).            4.60
        (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)...           11.60
        (f) Class X Weighing (per hour per service
         representative)................................           48.00
    (v) Additional tests (excludes sampling)
        (a) Aflatoxin (per test--other than TLC method).           25.60
        (b) Aflatoxin (per test--TLC method)............          101.60
        (c) Corn oil, protein, and starch (one or any
         combination)...................................            8.10
        (d) Soybean protein and oil (one or both).......            8.10
        (e) Wheat protein (per test)....................            8.10
        (f) Sunflower oil (per test)....................            8.10
        (g) Vomitoxin (qualitative).....................           26.10
        (h) Vomitoxin (quantitative)....................           31.10
        (i) Waxy corn (per test)........................            9.35
        (j) Canola (per test--00 dip test)..............            9.35
        (k) Pesticide Residue Testing \3\
            (1) Routine Compounds (per sample)..........          200.00
            (2) Special Compounds (per service
             representative)............................          100.00
        (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)....           76.60
        (a) Factor only (per factor--max 2 factors).....           39.60
        (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)........           25.85
        (b) Aflatoxin (TLC).............................          111.10
        (c) Corn oil, protein, and starch (one or any
         combination)...................................           15.85
        (d) Soybean protein and oil (one or both).......           15.85
        (e) Wheat protein (per test)....................           15.85
        (f) Sunflower oil (per test)....................           15.85
        (g) Vomitoxin (per test--qualitative)...........           36.10
        (h) Vomitoxin (per test--quantitative)..........           41.10
        (i) Vomitoxin (per test--HPLC Board Appeal).....          128.00
        (j) Pesticide Residue Testing \3\
            (1) Routine Compounds (per sample)..........          200.00
            (2) Special Compounds (per service
             representative)............................          100.00
        (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)....................................           69.60
(3) Stowage examination (service-on-request) \3\
    (i) Ship (per stowage space)........................  50.50 (minimum
                                                          $275 per ship)
    (ii) Subsequent ship examinations (same as original)
     (minimum $175 per ship)
    (iii) Barge (per examination).......................           40.50
    (iv) All other carriers (per examination)...........          15.50
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\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 Sec.  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 Sec.  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.


[[Page 70994]]


                  Table 3.--Miscellaneous Services \1\
 
 
 
(1) Grain grading seminars (per hour per service
 representative) \2\....................................          $48.00
(2) Certification of diverter-type mechanical samplers
 (per hour per service representative) \2\..............           48.00
(3) Special weighing services (per hour per service
 representative): \2\
    (i) Scale testing and certification.................           48.00
    (ii) Evaluation of weighing and material handling
     systems............................................           48.00
    (iii) NTEP Prototype evaluation (other than Railroad
     Track Scales)......................................           48.00
    (iv) NTEP Prototype evaluation of Railroad Track
     Scales (plus usage fee per day for test car).......           48.00
                                                                  110.00
    (v) Mass standards calibration and reverification...           48.00
    (vi) Special projects...............................           48.00
(4) Foreign travel (per day per service representative).          435.00
(5) Online customized data EGIS service:
    (i) One data file per week for 1 year...............          500.00
    (ii) One data file per month for 1 year.............          300.00
(6) Samples provided to interested parties (per sample).            2.50
(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 $48.00
  per hour.
\2\ Regular business hours--Monday thru Friday--service provided at
  other than regular hours charged at the applicable overtime hourly
  rate.

* * * * *
    Dated: December 17, 1998.
James R. Baker,
Administrator, Grain Inspection, Packers and Stockyards Administration.
[FR Doc. 98-33921 Filed 12-22-98; 8:45 am]
BILLING CODE 3410-EN-P