[Federal Register Volume 71, Number 69 (Tuesday, April 11, 2006)]
[Proposed Rules]
[Pages 18231-18236]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 06-3507]


 ========================================================================
 Proposed Rules
                                                 Federal Register
 ________________________________________________________________________
 
 This section of the FEDERAL REGISTER contains notices to the public of 
 the proposed issuance of rules and regulations. The purpose of these 
 notices is to give interested persons an opportunity to participate in 
 the rule making prior to the adoption of the final rules.
 
 ========================================================================
 

  Federal Register / Vol. 71, No. 69 / Tuesday, April 11, 2006 / 
Proposed Rules  

[[Page 18231]]



DEPARTMENT OF AGRICULTURE

Grain Inspection, Packers and Stockyards Administration

7 CFR Part 868

RIN 0580-AA92


Fees for Rice Inspection Services

AGENCY: Grain Inspection Packers and Stockyards Administration, USDA.

ACTION: Proposed rule.

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

SUMMARY: This proposed rule would revise the regulations governing the 
sampling, inspection, weighing, and certification for rice by 
increasing certain fees charged for the services by approximately 18 
percent. Further, the rice fees would be increased an additional 3 
percent each year through fiscal year 2010 and establish a stowage 
examination fee. These revisions are necessary in order to recover, as 
nearly as practicable, the costs of performing these services under the 
Agricultural Marketing Act of 1946 (AMA).

DATES: Comments must be received on or before June 12, 2006.

ADDRESSES: We invite you to submit comments on this proposed rule. You 
may submit comments by any of the following methods:
     E-Mail: Send comments via electronic mail to 
[email protected].
     Mail: Send hardcopy written comments to Tess Butler, 
GIPSA, USDA, 1400 Independence Avenue, SW., room 1647-S, Washington, DC 
20260-3604.
     Fax: Send comments by facsimile transmission to: (202) 
690-2755.
     Hand Delivery or Courier: Deliver comments to: Tess 
Butler, GIPSA, USDA, 1400 Independence Avenue, SW., Room 1647-S, 
Washington, DC 20250-3604.
     Federal eRulemaking Portal: Go to http://www.regulations.gov. Follow the online instructions for submitting 
comments.
    Instructions: All comments should make reference to the date and 
page number of this issue of the Federal Register.
    Read Comments: All comments will be available for public inspection 
in the above office during regular business hours (7 CFR 1.27(b)).

FOR FURTHER INFORMATION CONTACT: John Giler, Deputy Director, Field 
Management Division, at his E-mail address: [email protected], 
telephone (202) 720-0228.

SUPPLEMENTARY INFORMATION:

Executive Order 12866 and Regulatory Flexibility Act

    This rule has been determined to be non-significant for the 
purposes of Executive Order 12866 and, therefore, has not been reviewed 
by the Office of Management and Budget (OMB).
    Also, pursuant to the requirements set forth in the Regulatory 
Flexibility Act (RFA); the Grain Inspection, Packers and Stockyards 
Administration (GIPSA) has considered the economic impact of this 
action on small entities.
    The purpose of the RFA is to fit regulatory actions to the scale of 
businesses subject to such actions in order that small businesses will 
not be unduly or disproportionately burdened. The proposed action 
described herein is being taken because additional user fee revenues 
are needed to cover the costs of providing current and future program 
operations and services.
    There are approximately 135 applicants who receive rice inspection 
and weighing services. A small portion of these users are small 
entities under the criteria established by the Small Business 
Administration (13 CFR 121.201). There would be no additional 
reporting, recordkeeping, or other compliance requirements imposed upon 
small entities as a result of this proposed rule. GIPSA has not 
identified any other Federal rules which may duplicate, overlap or 
conflict with this proposed rule.
    GIPSA has determined that this proposed rule does not have a 
significant economic impact on a substantial number of small entities 
as defined under the RFA. The majority of applicants that apply for 
services do not meet the requirements of small entities. Rice 
inspection and weighing services are provided upon request and the fees 
charged to users of these services vary with usage. However, the impact 
on all businesses, including small entities, is very similar. Further, 
the rice industry businesses are under no obligation to use these 
services, and, therefore, any decision on their part to discontinue the 
use of the services should not prevent them from marketing their 
products.
    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 its 
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 
the Agency 3-month operating retained earnings. During fiscal year 
2004, the rice program revenue was nearly $4.3 million with costs at 
approximately $4.4 million resulting in an approximate $0.2 million 
program deficit. Current revenue for GIPSA's rice program during fiscal 
year 2005 was $4.4 million with costs at $4.7 million resulting in a 
$0.3 million program deficit. GIPSA's costs of operating the rice 
program are expected to be approximately $4.4 million during fiscal 
year 2006 and will gradually escalate to approximately $4.9 million by 
fiscal year 2010. These cost increases (2006 to 2010) are due to 
employee salaries and benefits coupled with estimated annual cost of 
living adjustments, the future costs of $50,000 to replace aging rice 
inspection equipment in the offices, and the need to fund $300,000 for 
an information technology upgrade to improve certification efficiency 
and program management. The current fee structure will not fully fund 
the rice program this fiscal year or future fiscal years resulting in 
continued program deficits. GIPSA will also remain below the Agency's 
3-month operating retained earnings level.
    This proposed 18 percent fee increase will initially increase the 
revenue of the program; however, this will not cover all of GIPSA's 
costs. GIPSA will need to continue to increase fees by 3 percent 
annually through fiscal year 2010 in order to cover the program's 
operating cost and replenish the 3-month retained earnings balance. 
GIPSA believes that an initial increase in fees followed by annual 
incremental increases is appropriate at this time. To minimize the 
impact of a fee increase, GIPSA has decided to propose fee rates that 
will collect sufficient revenue over time to

[[Page 18232]]

cover operating expenses, while striving to create a 3-month operating 
reserve by FY 2010. The cost of living projections used in calculating 
future salary, benefits, and all other non-salary expenses out to FY 
2010 were supplied by the Office of Management and Budget (OMB) as set 
forth in their Federal Register publication (69 FR 26900) on May 14, 
2004. GIPSA will evaluate the financial status of the rice program on a 
continuous basis to determine if it is meeting the goal of obtaining a 
3-month operating reserve by FY 2010, and to determine if other 
adjustments are necessary.
    GIPSA's financial projections indicate the retained earnings 
balance will meet the target level by the end of fiscal year 2010 after 
an initial 18 percent increase in fees followed by the annual 3 percent 
increases. GIPSA financial projections also considered plans to 
introduce program changes which will better control increases in long-
term costs. These program changes will involve a realignment of staff 
to better control rising personnel costs in the future.
    The following table reflects GIPSA's financial rice program 
projections through fiscal year 2010.

                                       Table 1.--Rice Program Projections
                                               [Million Dollars]*
----------------------------------------------------------------------------------------------------------------
                                                                   FY05    FY06    FY07    FY08    FY09    FY10
----------------------------------------------------------------------------------------------------------------
Revenue.........................................................    $4.4    $4.0    $4.7    $4.9    $5.0    $5.2
Obligations.....................................................     4.7     4.4     4.5     4.6     4.7     4.7
Retained Earnings--Projected....................................     0.4       0     0.3     0.5     0.8     1.2
Retained Earnings--Target (3-months operating obligations)......     1.2     1.1     1.1     1.2     1.2    1.2
----------------------------------------------------------------------------------------------------------------
* Figures may not sum due to rounding.

    This proposed rule will initially increase user fees by 18 percent 
and will follow with subsequent 3 percent increases until fiscal year 
2010. GIPSA is also proposing a new fee for stowage examination 
services which are provided as a service upon request.
    This action is authorized under the AMA (7 U.S.C. 1622 (h)) which 
provides for the establishment and collection of fees that are 
reasonable and, as nearly as practicable, cover the costs of the 
services rendered. These fees cover the GIPSA administrative and 
supervisory costs for the performance of official services, including 
personnel compensation and benefits, travel, rent, communications, 
utilities, contractual services, supplies, and equipment.

Paperwork Reduction Act and Government Paperwork Elimination Act

    In compliance with the Paperwork Reduction Act of 1995 (44 U.S.C. 
Chapter 35), the information collection and recordkeeping requirements 
included in this proposed rule has been approved by the OMB under 
control number 0580-0013.
    GIPSA is committed to compliance with the Government Paperwork 
Elimination Act, which requires Government agencies, in general, to 
provide the public the option of submitting information or transacting 
business electronically to the maximum extent possible.

Executive Order 12988

    This proposed rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. This action is not intended to have retroactive 
effect. This rule will not preempt any state or local laws, regulations 
or policies, unless they present an irreconcilable conflict with this 
rule. There are no administrative procedures which must be exhausted 
prior to any judicial challenge to the provisions of this rule.

Proposed Action

    The AMA of 1946 authorizes official inspection and weighing 
services, on a user-fee basis, of rice. The AMA of 1946 provides that 
reasonable fees be collected from the users of the services to cover, 
as nearly as practicable, the costs of the services rendered. This 
proposed rule would amend the schedule for fees and charges for 
inspection and weighing services rendered to the rice industry to 
reflect the costs necessary to operate the program.
    GIPSA regularly reviews its user-fee programs to determine if the 
fees are adequate. While GIPSA continues to search for opportunities to 
reduce its costs, the existing fee schedule will not generate 
sufficient revenues to cover program costs while maintaining the Agency 
3-month operating retained earnings. During fiscal year 2004, the rice 
program revenue was nearly $4.3 million with costs at approximately 
$4.4 million resulting in an approximate $0.2 million program deficit. 
Current revenue for GIPSA's rice program during fiscal year 2005 was 
$4.4 million with costs at $4.7 million resulting in a $0.3 million 
program deficit. GIPSA's costs of operating the rice program are 
expected to be approximately $4.4 million during fiscal year 2006 and 
will escalate to approximately $4.9 million by fiscal year 2010. These 
cost increases (2006 to 2010) are due to employee salaries and benefits 
coupled with estimated annual cost of living adjustments, the future 
costs of $50,000 to replace aging rice inspection equipment in the 
offices, and the need to fund $300,000 for an information technology 
upgrade to improve certification efficiency and program management. The 
current fee structure will not fully fund the rice program this fiscal 
year or future fiscal years resulting in a continued program deficit. 
GIPSA will also remain below the Agency's 3-month operating retained 
earnings level.
    This proposed 18 percent fee increase will initially increase the 
revenue of the program; however, this will not cover all of GIPSA's 
costs. GIPSA will need to continue to increase fees by 3 percent 
annually through fiscal year 2010 in order to cover the program's 
operating cost and replenish the 3-month retained earnings balance. 
GIPSA believes that an initial increase in fees followed by annual 
incremental increases is appropriate at this time. GIPSA's financial 
projections indicate the retained earnings balance will meet the target 
level by the end of fiscal year 2010 after an initial 18 percent 
increase in fees followed by the annual 3 percent increases (see Table 
1 in preceding section of the document). GIPSA financial projections 
also considered plans to introduce program changes which will better 
control increases in long-term costs.
    This proposed rule will initially increase user fees by 18 percent 
and will follow with subsequent 3 percent increases until fiscal year 
2010. GIPSA is also proposing a new fee for stowage examination 
services which are provided as a service upon request.
    Based on the aforementioned analysis of this program's costs, GIPSA 
proposes

[[Page 18233]]

to increase the fees for services under the rice program. GIPSA will 
review its cost, revenue, and operating reserve levels to ensure that 
the fee increases for the noted calendar years are required at the 
levels specified and sufficient to maintain official rice inspection 
and weighing services, upon request. In the event a change in the fees 
is necessary, GIPSA will engage in notice and comment rulemaking before 
making any changes.
    The following table compares current fees and charges with the 
proposed 18 percent fee increase as found in 7 CFR 868.91. This table 
also reflects the additional fees for stowage examination services that 
are provided upon request.

                                                     Table 2
----------------------------------------------------------------------------------------------------------------
                                         Current fees and charges                Proposed fees and charges
                                 -------------------------------------------------------------------------------
 Hourly rates/unit rate per CWT                           Nonregular                              Nonregular
                                    Regular workday    workday  (Sunday-    Regular workday    workday  (Sunday-
                                   (Monday-Saturday)       Holiday)        (Monday-Saturday)       Holiday)
----------------------------------------------------------------------------------------------------------------
Contract (per hour per Service                $46.40              $64.40              $54.80              $76.00
 representative)................
Noncontract (per hour per                      56.60               78.00               66.80               92.10
 Service representative)........
Export Port Services (per                       .056                .056               0.066               0.066
 hundredweight).................
----------------------------------------------------------------------------------------------------------------


------------------------------------------------------------------------
                                     Current fees and  Proposed fees and
            Unit Rates                   charges            charges
------------------------------------------------------------------------
Rough Rice:
  Inspection for quality (per lot,             $35.50             $41.90
   sublot, or sample inspection)..
        (a) Milling yield (per                  27.50              32.50
         Sample)..................
        (b) All other factors (per              13.20              15.60
         factor)..................
Brown Rice for Processing:
  Inspection for quality (per lot,              30.50              36.00
   sublot, or sample inspection)..
        (a) Milling yield (per                  27.50              32.50
         Sample)..................
        (b) All other factors 9per              13.20              15.60
         factor)..................
    Total oil and free fatty acid.              43.00              50.80
Milled Rice:
    Inspection for quality (per                 22.00              26.00
     lot, sublot, or sample
     inspection)..................
    All other factors (per factor)              13.20              15.60
    Total oil and free fatty acid.              43.00              50.80
Interpretive line samples:
        (a) Milling degree (per                 94.00             111.00
         set).....................
        (b) Parboiled light (per                23.00              27.20
         sample)..................
Stowage Examination (service on
 request):
    Ship (per stowage space)        .................              50.50
     (minimum $252.50 per ship)...
Subsequent ship examinations (same
 as original) (minimum $151.50 per
 ship):
    Barge (per examination).......  .................             $40.50
    All other carriers (per         .................             $15.50
     examination).................
------------------------------------------------------------------------

    A 60-day comment period is provided for interested persons to 
comment on this proposed action.

List of Subjects in 7 CFR Part 868

    Administrative practice and procedure, Agricultural commodities

    For reasons set out in the preamble, 7 CFR Part 868 is proposed to 
be amended as follows:

PART 868--GENERAL REGULATIONS AND STANDARDS FOR CERTAIN 
AGRICULTURAL COMMODITIES

    1. The authority citation for part 868 continues to read as 
follows:

    Authority: Secs. 202-208, 60 Stat. 1087 as amended (7 U.S.C. 
1621, et seq.)
    2. Section 868.91 is revised to read as follows:


 868.91  Fees for certain Federal rice inspection services.

    The fees shown in Tables 1 and 2 apply to Federal rice inspection 
services.

                Table 1.--Hourly Rates/Unit Rate per CWT
------------------------------------------------------------------------
                                                          Nonregular
           Service \1\              Regular workday    workday  (Sunday-
                                   (Monday-Saturday)       Holiday)
------------------------------------------------------------------------
                        Effective October 1, 2006
------------------------------------------------------------------------
Contract (per hour per Service                $54.80              $76.00
 representative)................
Noncontract (per hour per                      66.80               92.10
 Service representative)........
Export Port Services (per                      0.066               0.066
 hundredweight) \2\.............
------------------------------------------------------------------------
                        Effective October 1, 2007
------------------------------------------------------------------------
Contract (per hour per Service                $56.40              $78.30
 representative)................
Noncontract (per hour per                      68.80               94.80
 Service representative)........
Export Port Services (per                      0.068               0.068
 hundredweight) \2\.............
------------------------------------------------------------------------

[[Page 18234]]

 
                        Effective October 1, 2008
------------------------------------------------------------------------
Contract (per hour per Service                $58.10              $80.70
 representative)................
Noncontract (per hour per                      70.90               97.70
 Service representative)........
Export Port Services (per                      0.070               0.070
 hundredweight) \2\.............
------------------------------------------------------------------------
                        Effective October 1, 2009
------------------------------------------------------------------------
Contract (per hour per Service                $59.90              $83.10
 representative)................
Noncontract (per hour per                      73.00              100.60
 Service representative)........
Export Port Services (per                      0.072               0.072
 hundredweight) \2\.............
------------------------------------------------------------------------
                        Effective October 1, 2010
------------------------------------------------------------------------
Contract (per hour per Service                $61.70              $85.60
 representative)................
Noncontract (per hour per                      75.20              103.60
 Service representative)........
Export Port Services (per                      0.074               0.074
 hundredweight) \2\.............
------------------------------------------------------------------------
\1\ Original and appeal inspection services include: Sampling, grading,
  weighing, and other services requested by the applicant when performed
  at the applicant's facility.
\2\ Services performed at export port locations on lots at rest.


                    Table 2.--Unit Rates Service 1, 3
------------------------------------------------------------------------
 
------------------------------------------------------------------------
                        Effective October 1, 2006
------------------------------------------------------------------------
Inspection for quality (per lot, sublot, or sample
 inspection):
    (a) Rough rice.........................................       $41.90
    (b) Brown rice for processing..........................        36.00
    (c) Milled rice........................................        26.00
Factor analysis for any single factor (per factor):          ...........
    (a) Milling yield (per sample) (Rough or Brown rice)...        32.50
    (b) All other factors (per factor) (all rice)..........        15.60
  Total oil and free fatty acid............................        50.80
Interpretive line samples: 2                                 ...........
    (a) Milling degree (per set)...........................       111.00
    (b) Parboiled light (per sample).......................        27.20
Faxed and extra copies of certificates (per copy)..........         3.00
Stowage Examination (service-on-request): 4                  ...........
    (a) Ship (per stowage space) (minimum $252.50 per ship)        50.50
    (b) Subsequent ship examination (same as original)       ...........
     minimum $151.50 per ship).............................
    (c) Barge (per examination)............................        40.50
    (d) All other carriers (per examination)...............        15.50
------------------------------------------------------------------------
                        Effective October 1, 2007
------------------------------------------------------------------------
Inspection for quality (per lot, sublot, or sample           ...........
 inspection):
    (a) Rough rice.........................................       $43.20
    (b) Brown rice for processing..........................        37.10
    (c) Milled rice........................................        26.80
Factor analysis for any single factor (per factor):          ...........
    (a) Milling yield (per sample) (Rough or Brown rice)...        33.50
    (b) All other factors (per factor) (all rice)..........        16.10
Total oil and free fatty acid..............................        52.30
Interpretive line samples:2                                  ...........
    (a) Milling degree (per set)...........................       114.30
    (b) Parboiled light (per sample).......................        28.00
Faxed and extra copies of certificates (per copy)                   3.00
Stowage Examination (service-on-request): 4                  ...........
    (a) Ship (per stowage space) (minimum $252.50 per ship)        50.50
    (b) Subsequent ship examination (same as original)       ...........
     minimum $151.50 per ship).............................
    (c) Barge (per examination)............................        40.50
    (d) All other carriers (per examination)...............        15.50
------------------------------------------------------------------------
                        Effective October 1, 2008
------------------------------------------------------------------------
Inspection for quality (per lot, sublot, or sample           ...........
 inspection):
    (a) Rough rice.........................................       $44.50
    (b) Brown rice for processing..........................        38.20
    (c) Milled rice........................................        27.60
Factor analysis for any single factor (per factor):          ...........

[[Page 18235]]

 
    (a) Milling yield (per sample) (Rough or Brown rice)...        34.50
    (b) All other factors (per factor) (all rice)..........        16.60
Total oil and free fatty acid..............................        53.90
Interpretive line samples:2
    (a) Milling degree (per set)...........................       117.70
    (b) Parboiled light (per sample).......................        28.80
Faxed and extra copies of certificates (per copy)..........         3.00
Stowage Examination (service-on-request): 4                  ...........
    (a) Ship (per stowage space) (minimum $252.50 per ship)        50.50
    (b) Subsequent ship examination (same as original)       ...........
     minimum $151.50 per ship).............................
    (c) Barge (per examination)............................        40.50
    (d) All other carriers (per examination)...............        15.50
------------------------------------------------------------------------
                        Effective October 1, 2009
------------------------------------------------------------------------
Inspection for quality (per lot, sublot, or sample           ...........
 inspection):
    (a) Rough rice.........................................       $45.80
    (b) Brown rice for processing..........................        39.40
    (c) Milled rice........................................        28.40
Factor analysis for any single factor (per factor):          ...........
    (a) Milling yield (per sample) (Rough or Brown rice)...        35.50
    (b) All other factors (per factor) (all rice)..........        17.10
Total oil and free fatty acid..............................        55.50
Interpretive line samples:2
    (a) Milling degree (per set)...........................       121.30
    (b) Parboiled light (per sample).......................        29.70
Faxed and extra copies of certificates (per copy)..........         3.00
Stowage Examination (service-on-request): 4
    (a) Ship (per stowage space) (minimum $252.50 per ship)        50.50
    (b) Subsequent ship examination (same as original)       ...........
     minimum $151.50 per ship).............................
    (c) Barge (per examination)............................        40.50
    (d) All other carriers (per examination)...............        15.50
------------------------------------------------------------------------
                        Effective October 1, 2010
------------------------------------------------------------------------
Inspection for quality (per lot, sublot, or sample           ...........
 inspection):
    (a) Rough rice.........................................       $47.20
    (b) Brown rice for processing..........................        40.60
    (c) Milled rice........................................        29.30
Factor analysis for any single factor (per factor):          ...........
    (a) Milling yield (per sample) (Rough or Brown rice)...        36.60
    (b) All other factors (per factor) (all rice)..........        17.60
Total oil and free fatty acid..............................        57.20
Interpretive line samples:2
    (a) Milling degree (per set)...........................       124.90
    (b) Parboiled light (per sample).......................        30.60
Faxed and extra copies of certificates (per copy)                   3.00
Stowage Examination (service-on-request): 4
    (a) Ship (per stowage space) (minimum $252.50 per ship)        50.50
    (b) Subsequent ship examination (same as original)       ...........
     minimum $151.50 per ship).............................
    (c) Barge (per examination)............................        40.50
    (d) All other carriers (per examination)...............        15.50
------------------------------------------------------------------------
1 Fees apply to determinations (original or appeals) for kind, class,
  grade, factor analysis, equal to type, milling yield, or any other
  quality designation as defined in the U.S. Standards for Rice or
  applicable instructions, whether performed singly or in combination at
  other than at the applicant's facility.
2 Interpretive line samples may be purchased from the U.S. Department of
  Agriculture, GIPSA, FGIS, Technical Services Division, 10383 North
  Ambassador Drive, Kansas City, Missouri 64153-1394. Interpretive line
  samples also are available for examination at selected FGIS field
  offices. A list of field offices may be obtained from the Director,
  Field Management Division, USDA, GIPSA, FGIS, 1400 Independence
  Avenue, SW., STOP 3630, Washington, D.C. 20250-3630. The interpretive
  line samples illustrate the lower limit for milling degrees only and
  the color limit for the factor ``Parboiled Light'' rice.
3 Fees for other services not referenced in Table 2 will be based on the
  noncontract hourly rate listed in Sec.   868.91, Table 1.
4 If performed outside of normal business hours, 1\1/2\ times the
  applicable unit fee will be charged.



[[Page 18236]]

James E. Link,
Administrator, Grain Inspection, Packers and Stockyards Administration.
[FR Doc. 06-3507 Filed 4-10-06; 8:45 am]
BILLING CODE 3410-EN-P