[Federal Register Volume 66, Number 131 (Monday, July 9, 2001)]
[Rules and Regulations]
[Pages 35751-35755]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-17005]



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  Federal Register / Vol. 66, No. 131 / Monday, July 9, 2001 / Rules 
and Regulations  

[[Page 35751]]



DEPARTMENT OF AGRICULTURE

Grain Inspection, Packers and Stockyards Administration

7 CFR Part 800

[Docket No. FGIS-2001-001b]
RIN: 0580-AA75


Fees for Official Inspection and Official Weighing Services

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 
fees by approximately 6.1 percent. Contract and noncontract hourly 
rates, certain unit rates, and the administrative tonnage fee are 
increased. These fees apply only to official inspection and weighing 
services performed in the United States under the United States Grain 
Standards Act (USGSA), as amended. This fee increase of approximately 
6.1 percent is based on the cost-of-living increases utilizing an 
average of the locality pay adjustments and actual cost of performing 
official inspection services of 2.4 percent and 3.7 percent in fiscal 
year (FY) 2000 and FY 2001, respectively. GIPSA anticipates the 
increase in the user fees will generate approximately $575,000 in 
additional revenue.

EFFECTIVE DATE: August 8, 2001.

FOR FURTHER INFORMATION CONTACT: David Orr, Director, Field Management 
Division, at his E-mail address: [email protected], or telephone 
him at (202) 720-0228.

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. 
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. 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. Using 
the most recent data available as of April 30, 2001, GIPSA's FY 2001 
operating costs were $14,988,809 with revenue of $14,348,665 that 
resulted in a negative margin of $640,144. The current reserve negative 
balance of $954,547 continues to remain well below the desired 3-month 
reserve of approximately $3 million. In addition, GIPSA has revised its 
tonnage workload projection from 82 million metric tons to 79 million 
metric tons for FY 2001. This decrease in tonnage will adversely affect 
revenues. Notwithstanding GIPSA's efforts to contain and reduce costs, 
it anticipates that operating costs will continue to outpace revenues 
during FY 2001 and, therefore, additional fee increases are likely in 
the future.
    Employee salaries and benefits are major program costs that account 
for approximately 84 percent of FGIS's total operating budget. 
Effective May 1, 2000, GIPSA increased fees as published March 30, 
2000, in the Federal Register (65 FR 16783), by 2.4 percent. The 
average Federal salary increase effective January 2000 was 4.8 percent. 
GIPSA had anticipated that savings could offset the remaining 2.4 
percent of the Federal salary increase. GIPSA had anticipated an 
increase in metric tons inspected and/or weighed which in conjunction 
with a projected decrease in the number of paid hours could have offset 
the remaining half of the Federal salary increase. However, there was a 
7 percent decrease in metric tons FGIS inspected in FY 2000. This 
decrease caused a reduction in hours billed. FGIS also experienced a 
shift from noncontracted service hours to contracted service hours, 
which caused an increase in nonrevenue productive hours in some 
locations. These factors were not enough to offset the remaining 2.4 
percent Federal salary increases. The salary increase that became 
effective January 2001 averages 3.7 percent for FGIS employees. This 
final rule will increase overall program revenues by approximately 
$575,000.
    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 37 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 would be to incur 
an approximate 6.1 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

[[Page 35752]]

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 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 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 April 4, 2001, GIPSA proposed in the Federal Register (66 FR 
17817) to increase fees for official inspection and weighing services 
performed under the USGSA (7 U.S.C. 71 et seq.) by approximately 6.1 
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 March 30, 2000 (65 
FR 16783), and became effective on May 1, 2000.
    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. 
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. 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. As of 
April 30, 2001, GIPSA's FY 2001 operating costs were $14,988,809 with 
revenue of $14,348,665 that resulted in a negative margin of $640,114. 
The current reserve negative balance of $954,547 continues to be well 
below the desired 3-month reserve of approximately $3 million.
    Employee salaries and benefits are major program costs that account 
for approximately 84 percent of GIPSA's total operating budget. 
Effective May 1, 2000, GIPSA increased fees as published March 30, 
2000, in the Federal Register (65 FR 16783), by 2.4 percent. The 
average Federal salary increase that became effective January 2000 was 
4.8 percent. GIPSA had anticipated that savings could offset the 
remaining 2.4 percent of the Federal salary increase. GIPSA had 
anticipated an increase in metric tons inspected and/or weighed which 
in conjunction with a projected decrease in the number of paid hours 
could have offset the remaining half of the Federal salary increase. 
However, there was a 7 percent decrease in metric tons FGIS inspected 
in FY 2000. This decrease caused a reduction in hours billed. FGIS also 
experienced a shift from noncontracted service hours to contracted 
service hours, which caused an increase in nonrevenue productive hours 
in some locations. These factors were not enough to offset the 
remaining 2.4 percent Federal salary increases. The salary increase 
that became effective January 2001 averages 3.7 percent for FGIS 
employees.
    We have reviewed the financial position of our inspection and 
weighing program based on the increased salary and benefit costs, along 
with the projected FY 2001 workload of 82 million metric tons. Based on 
the review, we have concluded that an approximate 6.1 percent increase 
will have to be recovered at this time through increases in fees.
    The current hourly fees are:

 
----------------------------------------------------------------------------------------------------------------
                                                               Monday to    Monday to
                                                               Friday (6    Friday (6    Saturday,
                                                               a.m. to 6    p.m. to 6   Sunday, and    Holidays
                                                                 p.m.)        a.m.)       Overtime
----------------------------------------------------------------------------------------------------------------
1-year contract.............................................       $25.80       $28.00       $36.40       $43.60
6-month contract............................................        28.40        30.20        38.60        50.60
3-month contract............................................        32.40        33.40        42.00        52.20
Noncontract.................................................        37.60        39.60        48.00        59.00
----------------------------------------------------------------------------------------------------------------

    GIPSA has also identified certain unit fees, for services not 
performed at an applicant's facility, that contain direct labor costs 
and would 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 6.1 percent cost-of-living 
increase to salaries and benefits covered by the administrative tonnage 
fee results in an overall increase of an average of 6.1 percent to the 
administrative tonnage fee. Accordingly, GIPSA is increasing certain 
hourly rates, certain unit rates, and the administrative tonnage fee 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.

Comment Review

    GIPSA received one 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 commenter did not support the 
proposed rule. A summary of the comment and GIPSA's response is as 
follows:
    The commenter stated that the proposed fee increase was excessive 
and suggested GIPSA offset anticipated increases in costs for this 
fiscal year through improved operating efficiencies and additional 
reductions in overhead. In addition, the commenter 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

[[Page 35753]]

impact on the cost of providing official services.
    GIPSA disagrees that the approximate 6.1 percent fee increase is 
excessive. GIPSA is constantly exploring actions to reduce official 
inspection and weighing costs. However, as previously discussed in this 
final rule, unexpected export market developments and actions during 
the past year have reduced projected revenue. During the past 2 years, 
there has been a 12.7 percent shift from non-contract to contract 
services. This shift from non-contract to contract services generates 
less revenue for GIPSA. Furthermore, the use of more efficient export 
facilities has resulted in more metric tons loaded per hour while using 
fewer GIPSA official inspection and weighing personnel to provide that 
service. Consequently, there has been a 10.8 percent decrease in non-
contract-billed hours and a 14 percent reduction in paid hours.
    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 skilled and well-trained employees as 
valuable resources which 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. Further, GIPSA is 
constantly reviewing the inspection and weighing programs to assess 
service delivery and service 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 a 
skilled and well-trained workforce available for duty when service 
demands increase. GIPSA is also reviewing 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

    In the April 4, 2001, proposal there were four errors. The first 
error occurred on page 17817, column 2. The revenue figure for FY 2001 
should have read $6,326,583. The second error occurred in Table 1(1) 
Inspection and Weighing Services Hourly Rates (for service personnel). 
The hourly rates for the 3-and 6-month contract rates were transposed. 
The correct rates are that the 3-month contract hourly rates are higher 
than the 6-month contract hourly rates. The third error occurred in 
Table 2(3) Stowage examination. The minimum fee for a ship should have 
read $255, not $252.50; the minimum fee for a ship reinspection should 
have read $153, not $151.50. The fourth error was corrected in a 
Federal Register document published on April 16, 2001 (66 FR 19608). 
The document corrected the E-mail address for comments and the Table 1 
heading on page 17819.
    Accordingly, GIPSA is applying an approximate 6.1 percent increase 
to 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 GIPSA Laboratory; 
Table 2--Services Performed at Other Than an Applicant's Facility in a 
GIPSA Laboratory; and Table 3--Miscellaneous Services.

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
                                                               Friday  (6   Friday  (6   Saturday,
                                                               a.m. to 6    p.m. to 6   Sunday, and    Holidays
                                                                 p.m.)        a.m.)       Overtime
--------------------------------------------------------------------------------------------\2\-----------------
1-year contract.............................................       $27.40       $29.80       $38.60       $46.40
6-month contract............................................        30.20        32.00        41.00        53.60
(1) Inspection and Weighing Services Hourly Rates (per
 service representative)
    3-month contract........................................        34.40        35.60        44.60        55.40
    Noncontract.............................................        40.00        42.00        51.00        62.60
----------------------------------------------------------------------------------------------------------------


(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                 1.50
     combination)............................................
    (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) 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\

[[Page 35754]]

 
        (a) 1-1,000,000......................................    $0.1101
        (b) 1,000,001-1,500,000..............................     0.1005
        (c) 1,500,001-2,000,000..............................     0.0543
        (d) 2,000,001-5,000,000..............................     0.0402
        (e) 5,000,001-7,000,000..............................      0.022
        (f) 7,000,001 +......................................    0.0100
\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).


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)..............   $19.00
        (b) Railcar (per carrier)..............................    28.60
        (c) Barge (per carrier)................................   181.00
        (d) Sacked grain (per hour per service representative       0.02
         plus an administrative fee per hundredweight) (CWT)...
    (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       0.02
         plus an administrative fee per hundredweight) (CWT)...
    (iv) Other services                                          .......
        (a) Submitted sample (per sample--grade and factor)....    11.20
        (b) Warehouseman inspection (per sample)...............    19.00
        (c) Factor only (per factor--maximum 2 factors)........     5.00
        (d) Checkloading/condition examination (use hourly          0.02
         rates from Table 1, plus an administrative fee per
         hundredweight if not previously assessed) (CWT).......
        (e) Reinspection (grade and factor only. Sampling          12.40
         service additional, item (i) above)...................
        (f) Class X Weighing (per hour per service                 52.50
         representative).......................................
    (v) Additional tests (excludes sampling)
        (a) Aflatoxin (per test--other than TLC method)........    28.00
        (b) Aflatoxin (per test--TLC method)...................   106.00
        (c) Corn oil, protein, and starch (one or any               8.60
         combination)..........................................
        (d) Soybean protein and oil (one or both)..............     8.60
        (e) Wheat protein (per test)...........................     8.60
        (f) Sunflower oil (per test)...........................     8.60
        (g) Vomitoxin (qualitative)............................    29.50
        (h) Vomitoxin (quantitative)...........................    36.50
        (i) Waxy corn (per test)...............................     9.85
        (j) Canola (per test--00 dip test).....................     9.85
        (k) Pesticide Residue Testing \3\......................
            (1) Routine Compounds (per sample).................   207.00
            (2) Special Compounds (per service representative).   106.00
        (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)...........    79.00
        (a) Factor only (per factor--max 2 factors)............    41.50
        (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)...............    27.50
        (b) Aflatoxin (TLC)....................................   115.00
        (c) Corn oil, protein, and starch (one or any              16.50
         combination)..........................................
        (d) Soybean protein and oil (one or both)..............    16.50
        (e) Wheat protein (per test)...........................    16.50
        (f) Sunflower oil (per test)...........................    16.50
        (g) Vomitoxin (per test--qualitative)..................    39.00
        (h) Vomitoxin (per test--quantitative).................    44.00
        (i) Vomitoxin (per test--HPLC Board Appeal)............   134.00
        (j) Pesticide Residue Testing \3\......................
            (1) Routine Compounds (per sample).................   207.00
            (2) Special Compounds (per service representative).   106.00
        (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                 75.80
     representative)...........................................
(3) Stowage examination (service-on-request) \3\
    (i) Ship (per stowage space) (minimum $255.00 per ship)....    51.00
    (ii) Subsequent ship examinations (same as original)
     (minimum $153.00 per ship)................................
    (iii) Barge (per examination)..............................    41.00

[[Page 35755]]

 
    (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 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.


                  Table 3.--Miscellaneous Services \1\
------------------------------------------------------------------------
 
------------------------------------------------------------------------
(1) Grain grading seminars (per hour per service                  $52.50
 representative) \2\...........................................
(2) Certification of diverter-type mechanical samplers (per        52.50
 hour per service representative) \2\..........................
(3) Special weighing services (per hour per service
 representative) \2\
    (i) Scale testing and certification........................    52.50
    (ii) Evaluation of weighing and material handling systems..    52.50
    (iii) NTEP Prototype evaluation (other than Railroad Track     52.50
     Scales)...................................................
    (iv) NTEP Prototype evaluation of Railroad Track Scales....    52.50
    (Plus usage fee per day for test car)......................   110.00
    (v) Mass standards calibration and reverification..........    52.50
    (vi) Special projects......................................    52.50
(4) Foreign travel (per day per service representative)........   475.00
(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)........     2.60
(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 $52.50
  per hour.
\2\ Regular business hours-Monday through Friday-service provided at
  other than regular hours charged at the applicable overtime hourly
  rate.


    Dated: July 2, 2001.
David R. Shipman,
Acting Administrator, Grain Inspection, Packers and Stockyards 
Administration.
[FR Doc. 01-17005 Filed 7-6-01; 8:45 am]
BILLING CODE 3410-EN-P