[Federal Register Volume 74, Number 233 (Monday, December 7, 2009)]
[Proposed Rules]
[Pages 64027-64042]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-28958]


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DEPARTMENT OF LABOR

Occupational Safety and Health Administration

29 CFR Part 1910

[Docket No. OSHA-2007-0031]


Nationally Recognized Testing Laboratories; Proposed Rule

AGENCY: Occupational Safety and Health Administration (OSHA), Labor.

ACTION: Proposed Rule.

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SUMMARY: The Occupational Safety and Health Administration (OSHA) is 
proposing to adjust the approach it uses for calculating the fees the 
Agency charges Nationally Recognized Testing Laboratories (NRTLs) and 
to require prepayment of all of the fees. OSHA charges fees for 
specific types of services it provides to NRTLs. OSHA began charging 
these fees in 2000, and has revised its fee schedule only twice (in 
2002 and 2007), mainly to account for cost of living adjustments. The 
proposed change in calculation approach would result in an increase of 
the current fees and the issuance of a revised fee schedule. However, 
for existing NRTLs and pending applicants, the Agency intends to phase 
in, over three years, any proposed fee increase that is greater than 
$200.

DATES: You must submit information or comments by the following dates:
    Hard copy: Postmarked or sent by January 21, 2010.
    Electronic transmission or facsimile: Sent by January 21, 2010.

ADDRESSES: You may submit comments by any of the following methods:
    Electronically: You may submit comments and attachments 
electronically at http://www.regulations.gov, which is the Federal 
eRulemaking Portal. Follow the instructions online for making 
electronic submissions.
    Fax: If your submissions, including attachments, are not longer 
than 10 pages, you may fax them to the OSHA Docket Office at (202) 693-
1648.
    Mail, hand delivery, express mail, messenger or courier service: 
You must submit three copies of your comments and attachments to the 
OSHA Docket Office, Docket No. OSHA-2007-0031, U.S. Department of 
Labor, Room N-2625, 200 Constitution Avenue, NW., Washington, DC 20210. 
Deliveries (hand, express mail, messenger and courier service) are 
accepted during the Department of Labor's and Docket Office's normal 
business hours, 8:15 a.m.-4:45 p.m., e.t.
    Instructions: All submissions must include the Agency name and the 
OSHA docket number for this notice (OSHA Docket No. OSHA-2007-0031). 
Submissions, including any personal information you provide, are placed 
in the public docket without change and may be made available online at 
http://www.regulations.gov.
    Docket: To read or download submissions or other material in the 
docket, go to http://www.regulations.gov or the OSHA Docket Office at 
the address above. All documents in the docket are listed in the http://www.regulations.gov index; however, some information (e.g., 
copyrighted material) is not publicly available to read or download 
through the Web site. All submissions, including copyrighted material, 
are available for inspection and copying at the OSHA Docket Office.
    Extension of Comment Period: Submit requests for extensions 
concerning this notice to the Office of Technical Programs and 
Coordination Activities, NRTL Program, Room N-3655, OSHA, U.S. 
Department of Labor, 200 Constitution Avenue, NW., Washington, DC 
20210; fax (202) 693-1644.

FOR FURTHER INFORMATION CONTACT: For press inquiries, contact Ms. 
Jennifer Ashley, Director, Office of Communications, Room N-3647, OSHA, 
U.S. Department of Labor, 200 Constitution Avenue, NW., Washington, DC 
20210; telephone (202) 693-1999. For technical inquiries, contact Ms. 
MaryAnn Garrahan, Director, Office of Technical Programs and 
Coordination Activities, NRTL Program, OSHA, U.S. Department of Labor, 
200 Constitution Avenue, NW., Room N3655, Washington, DC 20210; 
telephone (202) 693-2110. Our Web page includes information about the 
NRTL Program (see http://www.osha.gov/dts/otpca/nrtl/index.html or see 
http://www.osha.gov and select ``N'' in the site index).

SUPPLEMENTARY INFORMATION:

I. Introduction
II. Background

[[Page 64028]]

III. Legal Considerations
IV. Explanation of Proposed Change in Approach for Calculating Fees
V. Basis and Derivation of Fee Amounts
VI. Proposed Fee Schedules
VII. Description of Fees
VIII. Major Changes to the Fee Schedule
IX. Proposed Changes to 29 CFR 1910.7(f)
X. Preliminary Economic Analysis and Initial Regulatory Flexibility 
Analysis
XI. Unfunded Mandates Reform Act
XII. Paperwork Reduction Act
XIII. Federalism
XIV. State Plan States
XV. Public Participation
XVI. List of Subjects
XVII. Authority and Signature
XVIII. Proposed Changes to 29 CFR 1910.7

I. Introduction

    The Occupational Safety and Health Administration (OSHA) is 
proposing to adjust the approach it uses to calculate the fees charged 
to Nationally Recognized Testing Laboratories (NRTLs). The proposed 
change will recoup a larger percentage of the cost of administering the 
NRTL Program. The adjusted approach would allow OSHA to continue to 
charge each NRTL for the core application processing and audit services 
provided to that NRTL while also recouping the shared costs of certain 
activities (referred to as ``ancillary activities'' in this notice) 
that benefit all NRTLs. These ancillary activities, which result in 
special benefits to NRTLs, currently represent a significant portion of 
OSHA's costs of running the NRTL Program. We explain these special 
benefits later in this notice. The revised fee approach would also 
recognize that the cost of leave earned by all staff directly involved 
in the NRTL Program should be factored into the personnel cost 
component of the fees. The current fee structure only incorporates 
leave costs for some of the staff working on the program.
    Because the proposed changes would result in a large increase to 
the fees for existing NRTLs and pending applicants, OSHA is proposing a 
three-year phase in of any fee increase that is greater than $200. OSHA 
also is proposing to revise language in 29 CFR 1910.7(f) (the OSHA rule 
implementing the NRTL fee structure) to clarify the nature of the costs 
upon which the fees are based. In addition, OSHA proposes to require 
advance payment of all NRTL fees, which complies with instructions to 
Federal agencies issued by the Office of Management and Budget (OMB).
    In section II, OSHA explains the NRTL Program and the existing fee 
structure for charging NRTLs for application processing and audits. In 
section III, OSHA explains the legal authority for recovering costs for 
ancillary activities and leave. The Agency also explains the basis for 
advance collection of the fees. Section IV describes how OSHA is 
proposing to recoup the ancillary and leave costs and, in section V, 
shows the derivation of the fee amounts. Sections VI and VII present 
the proposed revised fee schedule and fee descriptions, respectively. 
Finally, in section IX, OSHA explains the change it is making to the 
regulatory text of 29 CFR 1910.7(f). The remaining sections address 
other matters necessary for this rulemaking.

II. Background

    Many of OSHA's safety standards require that equipment or products 
used in the workplace be approved (i.e., tested and certified) to help 
ensure that they can be used safely. See, e.g., 29 CFR Part 1910, 
Subpart S. In general, this approval must be performed by an NRTL. In 
order to ensure that the testing and certification are done 
appropriately, OSHA administers the NRTL Program.
    The NRTL Program requirements are set forth in 29 CFR 1910.7, 
``Definition and requirements for a nationally recognized testing 
laboratory,'' which specifies that to be recognized and to maintain 
recognition as an NRTL, an organization must: (1) Have the appropriate 
capability to test, evaluate, and approve products to assure their safe 
use in the workplace; (2) be completely independent of the 
manufacturers, vendors, and major users of the products for which OSHA 
requires certification; (3) have internal programs that ensure proper 
control of the testing and certification process; and (4) have 
effective reporting and complaint handling procedures. 29 CFR 
1910.7(b).
    OSHA requires that organizations seeking initial recognition as an 
NRTL provide detailed and comprehensive information about their 
programs, processes, and procedures in writing when they apply. To 
process these applications, OSHA reviews the written information for 
completeness and adequacy, and conducts an on-site assessment to 
determine whether the organization meets the requirements of 29 CFR 
1910.7. OSHA uses a similar process when an NRTL (i.e., an organization 
already recognized) applies for expansion or renewal of its 
recognition. In addition, the Agency conducts annual audits primarily 
to ensure that each NRTL maintains its programs and continues to meet 
the recognition requirements. Currently, there are 15 NRTLs operating 
49 recognized sites in the U.S., Canada, Europe, and the Far East. 
Application processing and audits are the core functions that OSHA 
performs for the NRTL Program.
    In order to perform these core functions, OSHA must also perform a 
number of ancillary activities that support these functions. OSHA 
investigates complaints filed against NRTLs to ensure that the 
laboratories are adequately performing their testing and certification 
functions. OSHA represents the NRTL Program in a variety of forums 
related to conformity assessment \1\ of products used in the workplace. 
OSHA also maintains a detailed Web site that both explains the program, 
and, more importantly for the NRTLs, lists all the laboratories that 
are currently recognized, the products each can test, and their 
registered certification marks.
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    \1\ OSHA generally uses the term ``approval'' to describe the 
type of testing or certification activities performed by NRTLs. 
Conformity assessment is a term used internationally to describe 
such activities and is defined as ``any activity concerned with 
determining directly or indirectly that requirements are 
fulfilled.''
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    On August 30, 2000, OSHA established a schedule of fees for certain 
services rendered to NRTLs; specifically, the application processing 
and audit functions. In the Federal Register notice announcing the fee 
schedule (65 FR 46797, July 31, 2000), OSHA found that laboratories 
receive ``special benefits'' from the NRTL Program and that charging 
these laboratories was appropriate under the Independent Offices 
Appropriations Act of 1952 (IOAA) (31 U.S.C. 9701), OMB Circular A-25 
``User Charges,'' and other legal authorities. 65 FR 46803. OSHA 
stated:

    NRTLs accrue ``special benefits'' from the services that OSHA 
renders to them. These ``special benefits'' are the product of 
OSHA's initial and continuing evaluation of their qualifications to 
test and certify products used in the workplace, e.g., the 
acknowledgement of their capability as an NRTL. The primary special 
benefits of NRTL recognition are the resulting business 
opportunities to test and certify products for manufacturers, the 
NRTL's clients. These opportunities may be in the form of new, 
additional, or continuing revenue and clients. Once the NRTL has 
properly certified a product, a manufacturer may then sell this 
product to employers, enabling them to comply with product approval 
requirements in OSHA standards. 65 FR 46807.

    Through this rulemaking, OSHA promulgated 29 CFR 1910.7(f). 
Paragraph (f) states that each applicant for NRTL recognition and each 
NRTL must pay fees for services provided by OSHA. 29 CFR 1910.7(f)(1). 
Specifically, the Agency assesses fees for the following: (1) 
Processing of applications for initial recognition, expansion of

[[Page 64029]]

recognition, or renewal of recognition, including on-site reviews; 
review and evaluation of the applications; and preparation of reports, 
evaluations and Federal Register notices; and (2) audits. The rule also 
sets forth that fees are based, in part, on the staff costs per hour of 
performing application processing and/or audit activities.
    This proposed rule would adjust the approach that OSHA uses to 
calculate the fees it currently charges for the services it provides to 
NRTLs. OSHA is proposing this adjustment because the current fee 
schedule only recovers about half of the allowable reimbursable costs 
of the NRTL Program.\2\ In particular, the current approach does not 
recover the costs of the ancillary activities that are necessary to the 
program's functioning. The proposed adjusted approach would also take 
into account the value of the leave earned by all of the personnel 
involved in the program, whereas, the current approach accounts for 
leave earned by only a few of these personnel.
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    \2\ In February 2007, OSHA issued a revision of its Fee Schedule 
to account for increases in program costs (see 72 FR 7468). This 
revision, however, did not alter OSHA's method for calculating fees. 
The increase in the February 2007 fees was based on cost of living 
and time adjustments, but employed the same calculation set forth in 
the initial Federal Register notice published in July 2000. OSHA had 
previously updated the initial fees in January 2002 (see 67 FR 
5299).
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III. Legal Considerations

    This proposed rule adjusts the approach that the Agency uses to 
calculate the fees it charges NRTLs for services performed to the 
benefit of the NRTLs by including the costs for benefits that are 
shared by all NRTLs. As described above, these include certain costs 
associated with ancillary activities and leave. Although OSHA would 
still not charge separate fees for the time spent on ancillary 
activities and leave, the rate charged for the fee-generating 
activities would be adjusted to account for the portion of the program 
costs attributable to ancillary activities and leave. This section 
describes the legal basis for OSHA recouping these costs from the 
NRTLs.

A. Legal Authority for Charging Fees

1. Statutory Authority
    In Title V of the IOAA, Congress set forth its mandate for 
executive agencies to collect fees for services and things of value 
that the agencies provide. Congress intended that the agency programs 
that provide benefits to specific individuals or companies be funded by 
these beneficiaries and not by taxpayers at large. ``It is the sense of 
Congress that each service or thing of value provided by an agency * * 
* to a person * * * is to be self-sustaining to the extent possible.'' 
31 U.S.C. 9701(a). The Congressional Committee urging the measure 
indicated, ``The Committee is concerned that the Government is not 
receiving full return from many of the services which it renders to 
special beneficiaries.'' Nat'l Cable Television Ass'n v. U.S., 415 U.S. 
336 (1974) quoting H.R. Rep. No. 82-384, at 2-3 (1951).
    In addition to establishing a source of funding, Congress also 
provided general guidance to agency heads on the establishment of fees. 
The fees are to be ``fair'' and based on:
    (A) The costs to the Government;
    (B) The value of the service or thing to the recipient;
    (C) Public policy or interest served; and
    (D) Other relevant facts.
    31 U.S.C. 9701(b).
    The 1993 OMB Circular A-25 (discussed in greater detail below) 
embodies the authority of the IOAA and reflects interpretations from 
the related case law decisions.
    Since 1997, in OSHA's yearly appropriations, Congress has 
specifically authorized the Secretary of Labor to collect and retain 
fees charged to sustain the NRTL Program. ``[T]he Secretary of Labor is 
authorized * * * to collect and retain fees for services provided to 
Nationally Recognized Testing Laboratories, and may utilize such sums * 
* * to administer national and international laboratory recognition 
programs that ensure the safety of equipment and products used by 
workers in the workplace.'' See e.g., Consolidated Appropriations Act 
for FY 2000, Public Law No. 106-113 (113 Stat. 1501A-222) and 
Consolidated Appropriations Act, 2009, Public Law No. 111-8 (123 Stat. 
524).
2. Case Law
    The Supreme Court and the Courts of Appeals have issued decisions 
addressing the application of the IOAA and its interpretation by 
Federal agencies. These cases provide guidance that is more specific as 
to the fee schedules and the methods of assessing fees that agencies 
may use. They make clear that agencies may recoup all of the 
Governmental costs associated with providing private entities with 
specific benefits.
    In 1974, the Supreme Court decided the companion cases of Nat'l 
Cable Television Ass'n, 415 U.S. 336 and Fed. Power Comm'n v. New 
England Power Co., 415 U.S. 345 (1974). In Nat'l Cable, the Court found 
that an agency may charge a fee for services but that the fee should be 
based on ``value to the recipient.'' Nat'l Cable, 415 U.S. at 342-43. 
In New England Power Co., the Court held that pursuant to the IOAA and 
OMB Circular A-25, agencies can only recoup specific charges for 
specific services to specific individuals or companies. Fed. Power 
Comm'n, 415 U.S. at 349.
    In Nat'l Cable Television Ass'n, Inc. v. FCC, 554 F.2d 1094 (DC 
Cir. 1976), the Court of Appeals also made clear that the fees must be 
for specific services. The court upheld charging both an application 
fee and an annual fee provided that the agency makes clear which 
activities are covered by each of the fees to prevent charging twice 
for the same service. Nat'l Cable Television Ass'n, 554 F.2d at 1105. 
Furthermore, the court agreed that fees based on reasonable 
approximations of costs for the services would be acceptable. ``It is 
sufficient for the Commission to identify the specific items of direct 
or indirect cost incurred in providing each service or benefit for 
which it seeks to assess a fee, and then to divide that cost among the 
members of the recipient class * * * in such a way as to assess each a 
fee which is roughly proportional to the `value' which that member has 
thereby received.'' Nat'l Cable Television Ass'n, 554 F.2d at 1105-
1106.
    In Elec. Indus. Ass'n v. FCC, 554 F.2d 1109 (DC Cir. 1976), the 
Court of Appeals indicated that ``expenses incurred to serve some 
independent public interest cannot * * * be included in the cost basis 
for a fee, although the Commission is not prohibited from charging an 
applicant or grantee the full cost of services rendered * * * which 
also result in some incidental public benefits.'' Elec. Indus. Ass'n, 
554 F.2d at 1115. Moreover, the court held that the agency can only 
include, in the cost basis of the fees, expenses incurred to confer 
value upon the recipient. Id. Along similar lines, the Court of Appeals 
held in Capital Cities Communications, Inc. v. FCC, 554 F.2d 1135 (DC 
Cir. 1976), that ``the proper standard is not value derived by the 
recipient but rather value conferred on the recipient. In our view, 
this standard requires the fee assessed to bear a reasonable 
relationship to the cost of the services rendered to identifiable 
recipients.'' Capital Cities Communications, Inc., 554 F.2d at 1138.
    Lastly, in Miss. Power and Light v. U.S. Nuclear Regulatory Comm'n, 
601 F.2d 223 (5th Cir. 1979), the 5th Circuit Court of Appeals upheld 
the NRC's fee schedule methodology because the NRC did not seek to 
recover the entire cost of regulating. The NRC charged a fee

[[Page 64030]]

based only on the costs of providing a specific benefit to identifiable 
private parties. Miss. Power and Light, 601 F.2d at 230.
3. OMB Circular No. A-25
    Circular No. A-25 was issued by OMB pursuant to the IOAA, to 
establish ``Federal policy regarding fees assessed for Government 
services and for sale or use of Government goods or resources * * * 
[I]t provides guidance for agency implementation of charges and the 
disposition of collections.'' User Charges, Circular No. A-25, OMB 
(July 8, 1993).
    In section 6 of the Circular, OMB directs agencies to assess user 
charges ``against each identifiable recipient for special benefits 
derived from Federal activities beyond those received by the general 
public.'' Furthermore, user charges ``will be sufficient to recover the 
full cost to the Federal Government * * * of providing the service, 
resource, or good when the Government is acting in its capacity as 
sovereign.'' Finally, the Circular defines full cost to include ``all 
direct and indirect costs to any part of the Federal Government of 
providing a good, resource, or service.''
    In order to fulfill the mandate of the IOAA that agency programs 
should be self-sustaining to the extent that they provide special 
benefits to identifiable recipients, the OMB Circular directs agencies 
to recoup the ``full cost to the Federal Government'' of providing a 
service. It further specifies that full costs ``includes all direct and 
indirect costs'' of providing this service. Examples of such costs 
provided by the Circular include personnel costs (including salaries 
and fringe benefits), physical overhead, management and supervisory 
costs, and costs of enforcement and research. Circular No. A-25, OMB 
6(d)(1)(a)-(e).
    The legal authorities described above establish several 
considerations for determining how agencies can assess certain fees for 
services rendered: (1) The fees must be based upon special benefits 
derived from Federal activities beyond those received by the general 
public; (2) the benefits must be conferred on identifiable recipients; 
and (3) the fees must bear a reasonable relationship to the cost of the 
services rendered. In addition, the OMB circular makes clear that 
agencies can recoup indirect costs of services rendered to special 
beneficiaries and that agencies should strive to make agency programs 
self-sustaining to the extent that they provide special benefits to 
identifiable recipients. Assessing NRTL fees that recover the cost of 
ancillary activities and leave satisfies these considerations, which we 
further discuss below.

B. Explanation for Charging Fees for Ancillary Activities

    First, the proposed fee structure is based on special benefits. As 
noted earlier, NRTLs and applicants accrue special benefits from the 
services that OSHA renders for the fees. These special benefits are the 
product of OSHA's initial and continuing evaluation of an 
organization's qualifications to test and certify products used in the 
workplace. Primarily, these special benefits are the business 
opportunities that result from OSHA recognition of these organizations 
as NRTLs, which allows them to offer their testing and certification 
services to manufacturers whose products, when used in the workplace, 
must be tested and certified by an NRTL to comply with OSHA's 
requirement. These opportunities are ``special benefits derived from 
Federal activities beyond those received by the general public,'' as 
described in OMB Circular A-25.
    Ancillary activities performed OSHA under the NRTL Program result 
in identifiable costs from the provision of those specific services and 
benefits to NRTLs. Examples of ancillary activities include 
administration of the program, budgetary, and policy matters; training 
OSHA personnel to perform program activities; interagency and 
international coordination; responses to requests for information 
related to the program; handling complaints; Web site development and 
maintenance; and participation in meetings with stakeholders and 
outside interest groups.
    OSHA is required to recover the costs of these activities because 
such costs are incurred solely for the administration of the NRTL 
Program, from which NRTLs derive special benefits. The absence of these 
necessary activities would severely reduce, if not eliminate, many of 
the benefits that NRTLs derive from recognition by OSHA. Two examples 
illustrate this point. Through application processing and audits, OSHA 
determines which organizations qualify as NRTLs and which products each 
individual NRTL is qualified to approve. By maintaining a Web site, 
OSHA shares this information with the public. This benefits NRTLs by 
making their current and potential clients, as well as employers, aware 
that the NRTLs are qualified to approve products. Complaint handling is 
a valuable tool that OSHA relies upon, especially between audits, to 
learn of inappropriate or questionable activities by a particular NRTL. 
If, for example, OSHA receives a complaint that a lab is testing 
equipment that is to be used in very hazardous environments, but it is 
not recognized by OSHA to perform this testing, OSHA would investigate 
to determine whether the testing jeopardizes the safety of the 
equipment. If it does, OSHA could take steps to prevent an accident 
stemming from the use of this equipment. Thus, through complaint 
handling, OSHA reinforces the program's effectiveness, which maintains 
confidence in the program, and thus, the benefits derived by NRTLs from 
the program.
    Second, the benefits are conferred on identifiable recipients. As 
with the prior schedules, OSHA is assessing fees to identifiable 
recipients of the NRTL Program benefits. The ancillary activities 
result in benefits shared among all NRTLs, in contrast to the benefits 
of the core application and auditing services, which are more easily 
identified with individual NRTLs. In order to share the costs of these 
benefits equitably, while still ensuring that the fees charged are 
specific charges for specific services to specific companies, OSHA is 
apportioning the costs of the shared benefits in accordance with the 
time OSHA spends on core services provided to each NRTL. This approach 
recognizes that an individual NRTL's portion of the shared benefits is 
directly related to the core benefits it receives. OSHA is, therefore, 
retaining its fee structure of charging the NRTLs fees when a core 
action is directed at or initiated by an NRTL, while adjusting the rate 
used to compute the fee in order to recoup a greater portion of the 
actual program costs.
    OSHA will charge an NRTL a fee when the NRTL applies, for example, 
for an expansion of its recognition by OSHA. In this situation, the 
NRTL is asking OSHA to review its application for expansion so that the 
NRTL can expand its scope of recognition. The fee that OSHA would 
charge in this instance is directly related to the NRTL seeking the 
expansion. The converse is also true: If in any particular year an NRTL 
does not apply to expand its recognition, it will not be charged an 
expansion application fee. The proposed Fee Schedule would thus 
reimburse OSHA for ancillary activities but would do so by charging 
specifically identified laboratories only when they receive the core 
services of the program.
    Third, the fees charged bear a reasonable relationship to the costs 
of the program. OSHA is basing the fee schedule on the average cost of 
certain activities performed to the benefit of the NRTLs. These costs 
are documented by

[[Page 64031]]

the Agency. Through this proposed revised fee schedule, OSHA would 
recover a large percentage of the costs of the program. To ensure that 
it does not overcharge, OSHA has targeted this proposal to capture 
approximately 95% of the costs of the program.
    Finally, by including the costs of ancillary activities in the 
fees, OSHA would, for the first time, be fully compliant with the IOAA 
and OMB Circular A-25, both of which require Agency programs to be 
self-sustaining to the extent that they confer special benefits on 
identifiable recipients. In fact, until implementation of a revised fee 
schedule in February 2007 that allowed recovery of approximately 50% of 
program costs, OSHA had been recovering only about 30% of the costs of 
the NRTL Program. Taxpayers had been funding the remaining 70% through 
OSHA's annual appropriations. This does not comport with the IOAA and 
OMB Circular A-25, and OSHA is proposing to correct that with this 
proposed rule.
    Therefore, as explained above, OSHA concludes that including the 
cost of ancillary activities in the fees fits squarely within the legal 
framework described in the preceding section. That is, the fees are 
based on special benefits to NRTLs; assessed to identifiable 
beneficiaries of the NRTL Program; and reasonably related to OSHA's 
costs of providing the services to NRTLs.
    OSHA recognizes that this proposal differs from the position the 
Agency took in the 2000 rulemaking implementing the initial fee 
structure. In that rulemaking, OSHA stated that it would not seek to 
recover costs for certain types of ancillary activities such as 
training of compliance officers on the NRTL Program and Web site 
development. See, e.g., 65 FR 46802. At the time of that rulemaking, 
however, OSHA believed those activities would utilize only a small 
portion of NRTL Program's resources. Recent workload reviews show that 
these activities have become a large part of the program and are now 
more critical in supporting the NRTL Program's core functions. It is, 
therefore, appropriate for OSHA to include these costs in the fees.
    Because this work on ancillary activities has grown so much faster 
than program resources over the last several years, OSHA has less time 
available for application processing and audits. Moreover, because the 
existing fees only recoup the cost of time spent on core services, this 
means that OSHA is recovering a dwindling percentage of the NRTL 
Program costs. Thus, OSHA's ability to meet, on a timely basis, the 
needs of the NRTLs in application processing and auditing, while 
recovering its costs for providing those services, has been severely 
challenged. OSHA intends to provide, through this rule, resources to 
improve the program's effectiveness in rendering these core services.

C. Explanation for Assessing Costs for Leave

    Although the initial and current fee structures account for 
``personnel costs'' for core NRTL activities, they do not actually 
represent all personnel costs. In fact, they do not even represent the 
total time spent on core activities. As Federal employees, Department 
of Labor/OSHA employees earn leave as part of their regular 
compensation. However, the initial fee structure failed to account for 
leave earned by OSHA employees, even though that leave is part of the 
personnel costs of rendering the services.\3\ In this respect, the 
initial fee structure was not compliant with OMB Circular A-25 and the 
other legal authorities described above. Thus, in this proposed revised 
fee structure, OSHA is adjusting the personnel costs to include leave 
earned by all employees performing services in support of the NRTL 
Program.
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    \3\ A small portion of NRTL fees covers the costs of legal 
services performed by attorneys in the Office of the Solicitor of 
Labor. Leave costs are included in that portion of the fees.
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D. Explanation for Advance Collection of the Fees

    Currently, OSHA requires that NRTLs and applicants pay an 
application review fee when submitting their application, and, for 
initial applications, prepay the fee for the on-site assessment. The 
remainder of the fees is generally billed to the NRTLs or applicants 
after the services are rendered. When OSHA adopted this billing system 
in its final rule issued in 2000, it expected the system to ``reduce 
collection activity of the Agency, since only one bill would need to be 
sent to the NRTL for an audit, rather than the two contemplated under 
the NPRM.'' 65 FR 46802 (July 31, 2000). It therefore predicted a 
``minimal financial burden'' to the Agency by delaying collection. Id.
    In practice, however, those predictions have not proven true. In 
recent years, the post-collection system has created problems and 
resulted in the loss of some funds. For example, to ensure that the 
Agency retained all fees that were due for audits conducted during a 
fiscal year, OSHA had to request that NRTLs pay fees in advance for any 
audits that were conducted during the last two months of the Federal 
Government fiscal year. OSHA requested advance payment because, to 
comply with federal mandates, it could not retain any of these fees if 
received after the end of a fiscal year, but would forfeit them to a 
general Federal Government fund. The current fee collection system has 
also made it difficult in practice to ensure that the Agency complies 
with OMB Circular A-25, described above. In addition to providing 
guidance regarding the collection and retention of user fees, OMB 
Circular A-25 generally requires agencies to collect user fees in 
advance. See OMB Circular A-25, Section 6.a.2.(c) (``User charges will 
be collected in advance of, or simultaneously with, the rendering of 
services unless appropriations and authority are provided in advance to 
allow reimbursable services.''); see also OMB Circular A-11, 
``Preparation, Submission, And Execution Of The Budget'' (June 2008), 
section 20.13.\4\
---------------------------------------------------------------------------

    \4\ Section 20.13(a) is a description of revolving funds that 
also provides that in the absence of a revolving fund ``advance 
payments must accompany orders.'' Section 20.13(b) specifies that 
obligations by expenditure accounts may be covered in one of two 
ways: Through ``advances collected up to the amount of accompanying 
orders'' or by ``[w]orking capital that is available for this 
purpose.''
---------------------------------------------------------------------------

    The program exists for the benefit of NRTLs, but OSHA is currently 
required to advance funds to cover the program costs until they are 
reimbursed by NRTLs or applicants. Given competing demands on the 
appropriations from which these funds must be drawn, the continued use 
of general operating funds to front fund the NRTL Program could 
adversely impact OSHA's ability to perform other aspects of its 
mission.
    In summary, OSHA proposes to bill in advance for audits and fees to 
ensure compliance with the OMB guidance and to reduce any financial 
impact on OSHA's other activities caused by advancing funds to the NRTL 
Program. Where the fees are based on actual cost, the travel costs and 
other expenses would be estimated and billed in advance, with any 
difference between the actual cost and the estimate adjusted after the 
completion of the audit or other service. OSHA believes the advance 
collection may help NRTLs to schedule payments in that they will be 
made in advance of the mutually-agreed-upon date for OSHA's audits of 
the NRTLs.

IV. Explanation of Proposed Change in Approach for Calculating Fees

    Under the proposed rule, OSHA will continue to calculate the fee 
for each of the service activities listed in the fee schedule by 
multiplying an equivalent

[[Page 64032]]

average cost per hour rate (ECR) by the time it takes to perform that 
activity: Fee for activity = ECR x Time for activity.
    In the July 31, 2000, Federal Register notice, OSHA explained that 
the initial fee schedule's ECR was derived by dividing the total 
estimated direct and indirect costs of the program, excluding travel, 
(TPC) \5\ by the total available annual work hours of the NRTL Program 
and legal staff that perform the services (TAW).\6\ Although the 
derivation of the ECR was not illustrated as an equation in the 2000 
notice, we do so here for clarification and refer to it as ECR2000 (to 
contrast it with the equation for ECR2009, which is explained later in 
this notice): ECR2000 = TPC2000/TAW2000.\7\ As discussed above, this 
resulted in fees that recouped the costs only of the time spent 
actually performing individualized audits and application processing, 
and did not recoup the other costs associated with running the program 
and providing other benefits that are shared among all NRTLs.
---------------------------------------------------------------------------

    \5\ The TPC include personnel costs for the NRTL Program and 
legal staff (including support and management staff), equipment, 
contract, and other costs necessary for the operation of the 
program. Travel expenses are not included in the ECR because OSHA 
charges for the actual staff travel expenses of the on-site visits 
after they are completed.
    \6\ In discussing total hours in this notice, we often refer to 
FTEs, which stands for full-time equivalents and, for purposes of 
this notice, equals total work hours divided by 2,080, the total 
available annual work hours (TAW) for one full-time employee; that 
is, 1 FTE equals 2,080 hours.
    \7\ We will use the TPC abbreviation in discussing our 
calculations in this proposed rule, but the total amount shown in 
the July 2000 notice (i.e., TPC2000) will, of course, differ from 
the total shown now in this proposed rule (i.e., TPC2009) because 
total costs of the program have changed.
---------------------------------------------------------------------------

    To properly account for the costs associated with these shared 
benefits, we have calculated the new ECR (ECR2009): dividing the new 
estimate of the total cost of the NRTL Program (TPC2009) by the total 
annual service hours (TAS2009). This latter term is a new figure that 
equals the total estimated hours that the staff spend on the core 
service activities for which NRTLs will be billed. In terms of an 
equation: ECR2009 = TPC2009/TAS2009. By way of comparison with the 
initial and current fee schedules, TAS equals TAW minus estimated hours 
spent on ancillary activities (AH) and leave (LH): TAS = TAW - AH - LH. 
By continuing to include the full program costs in the numerator, but 
including, in the denominator, only the amount of time spent on 
providing ``billable'' core services, the revised ECR is more 
accurately tied to the hours spent on those core activities, which are 
the hours for which OSHA bills the NRTLs.
    OSHA could have achieved the same result by charging each NRTL 
separately for its share of the program resources used to produce the 
shared benefits. OSHA is not proposing this method primarily because 
the shared nature of these costs makes it impractical to calculate and 
track them separately for each NRTL and attribute them appropriately to 
individual NRTLs through separate fees. As explained above, the 
existing fee approach in which NRTLs are only charged for core services 
provides a more straightforward and manageable method of ensuring that 
OSHA recoups only ``specific charges for specific services to specific 
individuals or companies.'' Fed. Power Comm'n, 415 U.S. at 349.
    In addition to this methodological change, the proposed fee 
schedule presented in this notice also includes updated calculations of 
the total resources committed to the NRTL Program (TPC2009) and of the 
average time spent on some of the service activities for which fees are 
charged.
    OSHA has estimated that TAS2009 = 3.5075 FTEs (7295.6 hours), which 
is 50.11% of total available annual work hours (TAW2009), 7.0 FTE.\8\ 
Using the TPC2009 of $1,079,090, shown in Figure 1, below, the new rate 
is: ECR2009 = $1,079,090/7295.6 hours = $147.90.
---------------------------------------------------------------------------

    \8\ TAW2009 equals 7.0 FTE; AH2009 equals 2.6675 FTE; and LH2009 
equals 0.825 FTE. As a result, TAS2009 equals 7.0 minus 2.6675 minus 
0.825, which is equal to 3.5075 FTE. Note: We can also derive the 
ECR2009 from the ECR2007 ($63.80) using a factor that takes into 
account the effects due to leave and ancillary activities and the 
use of TAS instead of TAW. We do not illustrate this here since the 
calculation is more involved and gives the same result as the 
simpler equation above.
---------------------------------------------------------------------------

    The table below shows a summary of program costs and value of the 
revised ECR2009, which is later used to generate the 
proposed fee schedule in section VI, below.

   Figure 1--NRTL Program Annual Cost Estimates--Proposed New ECR2009
                               Calculation
                  [Including ancillary costs and leave]
------------------------------------------------------------------------
                        Description                             Costs
------------------------------------------------------------------------
Direct Expenses............................................     $512,342
Indirect Expenses *........................................      566,748
Total Program Costs (excluding travel) (aka ``TPC2009'')...    1,079,090
Travel Expenses............................................       72,600
Overall Program Costs (includes travel) **.................    1,151,690
TAS2009 (3.5075 FTE x 2,080 hours per FTE).................      7,295.6
ECR2009 = TPC2009/TAS2009..................................      147.90
------------------------------------------------------------------------
* This amount consists of $441,408 for management, ancillary, and
  support costs; and $125,340 for equipment and other costs. Note: These
  are costs incurred mostly by OSHA but also include applicable costs of
  a division of the Department of Labor's Office of the Solicitor.
** The amount of fee collections is estimated to be approximately 95.2%
  of this total or $1,096,000.

    Finally, as mentioned above, the total cost of administering the 
program has increased since the last revision to the fee schedule 
published on February 15, 2007. This cost increase is due to two main 
reasons: The proposed increase in the program's staff resources and the 
annual salary adjustments for Federal employees. As a result of the 
increase to the TPC and the revised approach of calculating the ECR2009 
proposed in this notice, OSHA's base rate (ECR) would increase almost 
132%, from $63.80 (in effect since February 15, 2007) to the $147.90 
shown above. Without the change in approach but with the increase in 
staffing, the rate and estimated total collections would have increased 
to $73.72 and $583,000, respectively.
    For existing NRTLs and pending applicants, OSHA proposes to phase 
in, over three years, any proposed fee increase that is greater than 
$200: a 33% increase for the first year's fees; a similar amount for 
the second year's fees; and the remainder in the third year. OSHA is 
proposing this $200 threshold because it limits the number of fees that 
would increase 100% for the first year; the increase for the remaining 
fees would be phased in, thus reducing the financial impact the 
increase has on any NRTL. As evident from the comparison of fees shown 
in section VIII, only three fees are affected, which would increase by 
a combined total of $510. OSHA seeks comment on the $200 threshold and 
on the three-year phase-in period, which is intended to balance the 
need for a period of adjustment for some existing NRTLs against OSHA's 
responsibility to recoup the full costs of the NRTL Program as soon as 
possible. Commenters who support these approaches or who suggest 
alternatives are encouraged to include a rationale for their 
recommendations.
    The entire increase would be effective immediately for any 
organization whose

[[Page 64033]]

application to become a new NRTL is received by OSHA after the 
effective date of the revised fee schedule in the final rule. Unlike 
currently recognized NRTLs and pending applicants, new applicants do 
not have a current stake in the program at the current fee schedule; 
new applicants are free to choose whether or not to participate in the 
program.

V. Basis and Derivation of Fee Amounts

    Figures 2, 3, 4, and 5, below, present the proposed costs of the 
major activities for the various fees categories. In general, OSHA 
calculated the cost of these activities by multiplying the staff 
activity time \9\ by ECR and adding any applicable average travel 
costs. However, because OSHA charges for actual travel, only the non-
travel costs serve as the basis for the fees later shown in Tables A 
and B. In deriving the fee amounts shown in the fee schedule (Table A 
or B), OSHA has generally rounded the costs shown in Figures 2, 3, 4, 
and 5, up or down, to the nearest $5 or $10 amount.
---------------------------------------------------------------------------

    \9\ The term ``staff'' encompasses federal employees as well as 
any contract employees retained by OSHA for work on the NRTL 
Program.

                                  Figure 2--Initial Application Cost Estimates
----------------------------------------------------------------------------------------------------------------
            Major activity                   Type of cost                Average hours           Average cost *
----------------------------------------------------------------------------------------------------------------
Initial Application Review...........  office and field staff    120.........................            $17,749
                                        time.
Additional Review Time...............  office staff............  16..........................              2,367
Limited Review Time..................  office staff............  24..........................              3,550
----------------------------------------------------------------------------------------------------------------
On-site Assessment--first day (per     field staff time (16      30..........................              4,437
 site, per assessor).                   hours preparation, 6
                                        hours travel documents
                                        processing, and 8 hours
                                        at site).
                                       field staff travel        not applicable..............                800
                                        expense ($700 airfare/
                                        other + $100 per diem).
                                      --------------------------------------------------------------------------
                                          Total................  ............................              5,237
----------------------------------------------------------------------------------------------------------------
On-site Assessment--each addnl. day    field staff time (at      8...........................              1,183
 ** (per site, per assessor).           site).
                                       field staff travel        not applicable..............                100
                                        expense (per diem only).
                                      --------------------------------------------------------------------------
                                          Total................  ............................              1,283
----------------------------------------------------------------------------------------------------------------
On-site Assessment travel time--per    field staff.............  8...........................              1,183
 day (per site, per assessor).
Review and Evaluation (10 test         office staff time.......  2...........................                296
 standards).
Final Report & Federal Register        field and office staff    132.........................             19,524
 notice.                                time.
Fees Invoice Processing..............  office staff time.......  2...........................               296
----------------------------------------------------------------------------------------------------------------
* Average cost for staff time = average hours x equivalent average direct staff cost/hr. ($147.90).
** Note: 2 additional days are estimated if there are 2 assessors and 4 additional days are estimated if there
  is 1 assessor.
See notes to Table A Fee Schedule for more information concerning the activities listed in this figure.


                        Figure 3--Expansion Application (Additional Site) Cost Estimates
----------------------------------------------------------------------------------------------------------------
            Major activity                   Type of cost                Average hours           Average cost *
----------------------------------------------------------------------------------------------------------------
Application Review (expansion for      office and field staff    56..........................             $8,283
 site).                                 time.
Additional Review Time...............  office staff............  8...........................              1,183
----------------------------------------------------------------------------------------------------------------
On-site Assessment--first day (per     field staff time (12      40..........................              5,916
 site, per assessor).                   hours preparation, 4
                                        hours travel documents
                                        processing, and 8 hours
                                        at site).
                                       field staff travel time   not applicable..............                800
                                        expense (700 airfare/
                                        other + 100 per diem).
                                      --------------------------------------------------------------------------
                                          Total................  ............................              6,716
----------------------------------------------------------------------------------------------------------------
On-site Assessment--additional day **  field staff time (at      8...........................              1,183
 (per site, per assessor).              site).
                                       field staff travel        not applicable..............                100
                                        expense (per diem only).
                                      --------------------------------------------------------------------------
                                          Total................  ............................              1,283
----------------------------------------------------------------------------------------------------------------
On-site Assessment travel time--per    field staff.............  8...........................              1,183
 day (per site, per assessor).
Review and Evaluation Fee (10 test     office staff time.......  2...........................                296
 standards).
Final Report & Federal Register        field and office staff    50..........................              7,396
 notice.                                time.
Fees Invoice Processing..............  office staff time.......  2...........................                296
----------------------------------------------------------------------------------------------------------------
* Average cost for staff time = average hours x equivalent average direct staff cost/hr. (147.90).
** Note: 2 additional days are estimated if there is 1 assessor.
See notes to Table A Fee Schedule for more information concerning the activities listed in this figure.


[[Page 64034]]


             Figure 4--Renewal or Expansion (Other Than Additional Site) Application Cost Estimates
----------------------------------------------------------------------------------------------------------------
            Major activity                   Type of cost                Average hours           Average cost *
----------------------------------------------------------------------------------------------------------------
Application Review (renewal or         office and field staff    2...........................               $296
 expansion other than additional        time.
 site).
Additional Review Time...............  office staff............  8...........................              1,183
Renewal Application--Information       office staff............  40..........................              5,916
 Review.
----------------------------------------------------------------------------------------------------------------
On-site Assessment--first day          field staff time (8       20..........................              2,958
 (expansion) (per site, per assessor).  hours preparation, 4
                                        hours travel documents
                                        processing, and 8 hours
                                        at site).
                                       field staff travel        not applicable..............                800
                                        expense (700 airfare/
                                        other + 100 per diem).
                                      --------------------------------------------------------------------------
                                          Total................  ............................              3,758
----------------------------------------------------------------------------------------------------------------
On-site Assessment--first day          field staff time (16      28..........................              4,141
 (renewal) (per site, per assessor).    hours preparation, 4
                                        hours travel documents
                                        processing, and 8 hours
                                        at site).
                                       field staff travel        not applicable..............                800
                                        expense (700 airfare/
                                        other + 100 per diem).
                                      --------------------------------------------------------------------------
                                          Total................  ............................              4,941
----------------------------------------------------------------------------------------------------------------
On-site Assessment--addnl. day **      field staff time (at      8...........................              1,183
 (per site, per assessor).              site).
                                       field staff travel        not applicable..............                100
                                        expense (covers per
                                        diem only).
                                      --------------------------------------------------------------------------
                                          Total................  ............................              1,283
----------------------------------------------------------------------------------------------------------------
On-site Assessment travel time--per    field staff.............  8...........................              1,183
 day (per site, per assessor).
Review and Evaluation Fee (10 test     office staff time.......  2...........................                296
 standards) (expansion).
Final Report & Federal Register        office and field staff    50..........................              7,396
 notice.                                time (if there is an on-
                                        site assessment).
Final Report & Federal Register        office and field staff    30..........................              4,437
 notice.                                time (if there is NO on-
                                        site assessment).
Supplemental Program Review..........  office and field staff    4...........................                592
                                        time (per program
                                        requested incl.
                                        consultation and
                                        assessor's memo).
Fees Invoice Processing..............  office staff time.......  2...........................                296
----------------------------------------------------------------------------------------------------------------
* Average cost for staff time = average hours x equivalent average direct staff cost/hr. (147.90).
** Note: 2 additional days are estimated for renewal assessment; no additional days for expansion assessment.
See notes to Table A Fee Schedule for more information concerning the activities listed in this figure.


                                     Figure 5--On-Site Audit Cost Estimates
----------------------------------------------------------------------------------------------------------------
            Major activity                   Type of cost                Average hours           Average cost *
----------------------------------------------------------------------------------------------------------------
On-site Audit--first day (per site,    field staff time (12      24..........................             $3,550
 per auditor).                          hours pre-site review
                                        preparation, 4 hours
                                        travel documents
                                        processing, and 8 hours
                                        at site).
                                       prepare report/contact    26..........................              3,846
                                        NRTL plus office review
                                        staff time (2 days for
                                        field staff and 2 hours
                                        for office staff).
                                      --------------------------------------------------------------------------
                                          Subtotal (first day).  ............................              7,396
                                      --------------------------------------------------------------------------
                                       field staff travel        not applicable..............                800
                                        expense (700 airfare/
                                        other + 100 per diem).
                                      --------------------------------------------------------------------------
                                          Total................  ............................              8,196
----------------------------------------------------------------------------------------------------------------
On-site Audit--addnl. day ** (per      field staff time (at      8...........................              1,183
 site, per auditor).                    site).
                                       travel expense (covers    not applicable..............                100
                                        per diem only).
                                      --------------------------------------------------------------------------
                                          Total................  ............................              1,283
----------------------------------------------------------------------------------------------------------------
On-site Audit travel time--per day     field staff.............  8...........................              1,183
 (per site, per auditor).
Fees Invoice Processing..............  office staff time.......  2...........................                296
----------------------------------------------------------------------------------------------------------------
* Average cost for staff time = average hours x equivalent average direct staff cost/hr. (147.90)
** Note: 1.0 additional day is estimated if there is 1 auditor.
See notes to Table A Fee Schedule for more information concerning the activities listed in this figure.


[[Page 64035]]

VI. Proposed Fee Schedules

A. Proposed First Phase Fee Schedule

    OSHA proposes the adjusted fee schedules shown below as Tables A 
and B. If the revised fees were to go into effect as proposed, all 
existing NRTLs would be charged the fees set forth in Table A in the 
first year. New applicants would be charged the fees set forth in Table 
B.
    The fees in Table A represent only the first phase of OSHA's fee 
increase. As explained above, for existing NRTLs and pending 
applicants, OSHA would phase in any increase in fees that is greater 
than $200 over a period of three years: 33% of the increase in this 
current revision; another 33% in the second year; and the final 34% in 
the third year. The percentage increase in the next two years, however, 
would be adjusted by any increase or decrease in fees calculated for 
each of those years when OSHA performs its annual review of the fees. 
During this review, OSHA would determine the amount of time we have 
actually charged for application processing and audits, and the actual 
indirect travel we performed, and adjust the amount in any proposed fee 
schedule by the amount over- or underestimated.

 Table A--Fee Schedule Nationally Recognized Testing Laboratory Program
                      (NRTL Program): Fee Schedule
   [Effective (to be provided in final notice published in the Federal
                             Register)] \12\
------------------------------------------------------------------------
                               Activity or category
                                 (fee charged per
      Type of service           application unless        Fee amount
                                 noted otherwise)
------------------------------------------------------------------------
APPLICATION PROCESSING.....  Initial Application      $17,750.
                              Review \1,\ \8\.
                             Expansion Application    $3,420.
                              Review (per additional
                              site) \1,\ \8\.
                             Renewal or Expansion     $300.
                              (other) Application
                              Review \1\.
                             Renewal Information      $1,470.
                              Review Fee \7\.
                             Additional Review--      $2,370.
                              Initial Application
                              (if the application is
                              substantially revised,
                              submit one-half
                              Initial Application
                              Review fee) \7\.
                             Additional Review--      $730.
                              Renewal or Expansion
                              Application \7\.
                             Limited Review--Initial  $3,550.
                              Application \7\.
                             Assessment--Initial      $4,440 + travel
                              Application (per         expenses.
                              person, per site--
                              first day) \2,\ \10\
                              [$2,740, if
                              application is pending
                              on effective date
                              above].
                             Assessment--Renewal      $2,570 + travel
                              Application (per         expenses.
                              person, per site--
                              first day) \3,\ \10\.
                             Assessment--Expansion    $2,200 + travel
                              Application              expenses.
                              (additional site) (per
                              person, per site--
                              first day) \3\.
                             Assessment--Expansion    $1,830 + travel
                              Application (other)      expenses.
                              (per person, per site--
                              first day) \3\.
                             Assessment--each addnl.  $730 or $1,180 +
                              day or each day on       travel expenses.
                              travel (per person,
                              per site) \2,\ \3\
                              [$1,180 for new
                              applications; $730 for
                              pending or other
                              applications].
                             Review & Evaluation \5\  $30 per standard
                              ($30 per standard if     OR $296 per
                              it is already            standard.
                              recognized for NRTLs
                              and requires minimal
                              review; OR else $296
                              per standard).
                             Final Report/Register    $19,520.
                              Notice--Initial
                              Application \5,\ \9\
                              [$12,080, if
                              application is pending
                              on effective date
                              above].
                             Final Report/Register    $4,580.
                              Notice--Renewal or
                              Expansion Application
                              (if OSHA performs on-
                              site assessment) \5,\
                              \9\.
                             Final Report/Register    $2,740.
                              Notice--Renewal or
                              Expansion Application
                              (if OSHA performs NO
                              on-site assessment)
                              \5,\ \9\.
AUDITS.....................  On-site Audit (per       $4,240 + travel
                              person, per site,        expenses.
                              first day) \6\.
                             On-site Audit--each      $730 + travel
                              addnl. day or each day   expenses.
                              on travel (per person,
                              per site) \6\.
                             Office Audit (per        $730.
                              person, per site) \6\.
MISCELLANEOUS..............  Supplemental Travel      $1,000.
                              (per site--for sites
                              located outside the 48
                              contiguous States or
                              the District of
                              Columbia) \4\.
                             Supplemental Program     $270.
                              Review (per program
                              requested) \4\.
                             Fees Invoice Processing  $300.
                              (per application or
                              audit) \4\.
                             Travel Document          $890.
                              Processing (6 hours,
                              per application or
                              audit) \4\.
                             Late Payment \11\......  $150.
                             Comp Time (per hour)     $56.40.
                              \10\.
------------------------------------------------------------------------
Notes to Table A, OSHA Fee Schedule for NRTLs:
\1\ Must I pay the Application Review fees, and when must they be paid?
If you are applying for initial recognition as an NRTL, you must pay the
  Initial Application Review fee and include this fee with your initial
  application. If you are an NRTL and applying for an expansion or
  renewal of recognition, you must pay the Expansion Application Review
  fee or Renewal Application Review fee, as appropriate, and submit this
  fee concurrently with your expansion or renewal application. See note
  7 if you amend or revise your initial or expansion application.
\2\ What assessment fees do I pay for an initial application, and when
  must they be paid?
If you are applying for initial recognition as an NRTL, and we accept
  your application, we bill you for the assessment fee and you must pay
  it before we perform the assessment. The prepaid assessment fee will
  be based on estimated staff time and travel costs. After completing
  the actual assessment, we calculate the actual assessment fee based on
  the actual staff time and travel costs incurred in performing the
  assessment. We calculate this fee at the rate of $4,440 for the first
  day at the site, $1,180 for each additional day at the site, and
  $1,180 for each day in travel, plus actual travel expenses, for each
  assessor [if pending, the rates are $2,740, $730, and $730,
  respectively.]. (Note: Days charged for being in travel status are
  those allowed under government travel rules. This note applies to any
  assessment or audit.) Actual travel expenses are determined by
  government per diem and other travel rules. We bill or refund the
  difference between the amount you prepaid and the actual assessment
  fee. We reflect this difference in the final bill that we send to you
  for the application.
\3\ What assessment fees do I submit for an expansion or renewal
  application, and when must they be paid?

[[Page 64036]]

 
If you are an NRTL and applying solely for an expansion or renewal of
  recognition, you do not submit any assessment fee with your
  application. If we need to perform an assessment for the expansion or
  renewal request, we bill you for this fee and you must pay it before
  we perform the assessment. The prepaid fee will be based on estimated
  staff time and travel costs. Following the assessment, we will
  calculate the actual fee based on the actual staff time and travel
  costs we incurred in performing the assessment. We calculate this fee
  at the rate of $2,570, $2,220, or $1,830 for the first day at the site
  of a renewal, expansion (site), and expansion (other) assessment,
  respectively. We also include $730 for each additional day at the site
  and $730 for each day in travel, plus actual travel expenses, for each
  assessor. Actual travel expenses are determined by government per diem
  and other travel rules. When more than one site of the NRTL is visited
  during one trip, we charge the $730 additional day fee, plus actual
  travel expenses, for each day at a site. We bill or refund the
  difference between the amount you prepaid and the actual assessment
  fee. We reflect this difference in the final bill that we send to you
  for the application.
\4\ When do I pay the Supplemental Travel, the Supplemental Program
  Review, the Fees Invoice Processing fees, or the Travel Document
  Processing fee?
You must pay the Supplemental Travel fee when you submit an initial
  application for recognition and the site you wish to be recognized is
  located outside the 48 contiguous U.S. states or the District of
  Columbia. The current supplemental travel fee is $1,000. We factor in
  this prepayment when we bill for the actual costs of the assessment,
  as described in our note 2, above. See note 8 for possible refund of
  application or assessment fees. You must pay the Supplemental Program
  Review fee when you apply for approval to use other qualified parties
  or facilities to perform specific activities. See Chapter 2 of the
  NRTL Program Directive for more information. We will include the Fees
  Invoice Processing fee in the total for each of our invoices to you.
  You must pay the Travel Document Processing fee in advance to cover
  the costs of arranging and obtaining reimbursement for travel. It is
  generally included in the first day fee for assessments and audits. We
  charge this fee separately for trips to a location when the
  preparation time for the trip is minimal. An example is trips to a
  site that the NRTL has qualified to perform specific or limited
  testing or certification activities for the NRTL.
\5\ When do I pay the Review and Evaluation and the Final Report/
  Register Notice fees?
An applicant or an NRTL must pay the appropriate fees in advance of OSHA
  performing the assessment for the application. We calculate the Review
  and Evaluation Fee at the rate of $30 per test standard requested for
  those standards that OSHA previously recognized for any NRTL and that
  require minimal review or do not represent a new area of testing for
  the NRTL. Otherwise, this fee is $296 per standard requested.
\6\ When do I pay the Audit fee?
Each NRTL must pay this fee (on-site or office, as deemed necessary) in
  advance of OSHA commencing the audit, and we calculate this prepaid
  fee based on estimated staff time and travel costs. Following the
  audit, we will calculate the actual fee based on actual staff time and
  travel costs incurred in performing the audit. We calculate our fee at
  the rate of $4,240 for the first day at the site, $730 for each
  additional day at the site, and $730 for each day in travel, plus
  actual travel expenses for each auditor. Actual travel expenses are
  determined by government per diem and other travel rules. We may add
  any underpayment(s) or credit any overpayments to the invoice for a
  future audit of the NRTL's site.
\7\ When do I pay the Additional Review fee, Renewal Information Review
  fee, or Limited Review fee?
The Additional Review fees cover the staff time in reviewing new or
  modified information submitted after we have completed our preliminary
  review of an application. There is no charge for review of a ``minor''
  revision, which entails modifying or supplementing less than
  approximately 10% of the documentation in the application. You must
  pay the Additional Review fee when submitting revisions modifying or
  supplementing from 10% to 50% of that documentation. For a new
  application, the fee represents 16 hours of additional review time and
  for a renewal or expansion application, the fee represents 8 hours of
  additional review time. If an applicant exceeds that 50% threshold in
  revising its application, when submitting your revised documentation,
  you must pay half the Initial Application Review fee or the full
  Expansion Application Review fee ($3,420), as applicable. The Renewal
  Information Review fee applies when an NRTL submits updated
  information to OSHA in connection with a request for renewal of
  recognition. You must pay the Additional Review or Renewal Information
  Review fee when submitting the additional or updated information. The
  Limited Review Fee covers the time to review and return a new
  application that we find to be substantially deficient. This fee is
  deducted from any refund issued to the applicant.
\8\ When and how can I obtain a refund for the fees that I paid?
If you withdraw your initial application or your expansion application
  to include an additional site, we will refund half of the application
  review fee. If you withdraw your application before we commence travel
  to your site to perform the on-site assessment, we will refund any
  prepaid assessment fees or credit your account. We will also credit
  your account for any amount of the prepaid assessment or audit fees
  collected that is greater than the actual cost of the assessment. If
  the Limited Review fee applies, we will refund the amount of the
  initial application review fee in excess of the limited fee. If an
  organization is no longer part of the program, we will refund any
  funds collected in excess of all valid actual costs incurred through
  the date of the termination. Other than these cases, we do not
  generally refund or grant credit for any other fees that are due or
  collected.
\9\ Am I still liable for any fees even if my application is rejected or
  my recognition is terminated?
If we reject your application, we will retain the fees pertaining to
  tasks that we have performed. For example, if we perform an assessment
  for an expansion application but deny the expansion, we will retain
  your prepaid assessment fee. Similarly, we will retain the Final
  Report and Federal Register fee if we also wrote the report and
  published the notice. See note 11 for the consequences of nonpayment.
\10\ What rate does OSHA use to charge for staff time (including Comp
  Time)?
OSHA has estimated an equivalent staff cost per hour that it uses for
  determining the fees that are shown in the Fee Schedule. This hourly
  rate takes into account the costs for salary, fringe benefits,
  equipment, contract services, supervision and support for each
  ``direct staff'' member, that is, the staff that perform the main
  activities identified in the Fee Schedule. The rate is an average of
  these amounts for each of these direct staff members. The current
  estimated equivalent staff costs per hour = $147.90. The hourly rate
  for Comp Time is based on the direct staff average salary and fringe
  costs only ($56.40).
[For more information about Comp Time, see additional explanation in
  section VIII of this notice (Major Changes to the Fee Schedule).]
\11\ What happens if I do not pay the fees that I am billed?
As explained above, if you are an applicant, we will send you a final
  bill (for any assessment and for the Review and Evaluation and Final
  Report/Register Notice fees) in advance of the assessment. If you do
  not pay the bill by the due date, we will assess the Late Payment fee
  shown in the Fee Schedule. This late payment fee represents one hour
  of staff time at the equivalent staff cost per hour (see note 10). We
  will halt any work on the application. If we do not receive payment
  within 30 days of the original due date, we will cancel your
  application. If you do not pay the prepaid fee for an audit by the due
  date, we will assess the Late Payment Fee shown in the Fee Schedule.
  However, OSHA may decide to proceed with the audit. If we do not
  receive payment within 30 days of the original due date, for an audit,
  we will publish a Federal Register notice stating our intent to revoke
  recognition. However, please note that in either case, you may be
  subject to collection procedures under U.S. (Federal) law.
\12\ How do I know whether this is the most Current Fee Schedule?
You should contact OSHA's NRTL Program (202-693-2110) or visit the
  program's Web site to determine the effective date of the most current
  Fee Schedule. Access the site by selecting ``N'' in the Subject Index
  at www.osha.gov. Any application review fees are those in effect on
  the date you submit your application. Other application processing
  fees are those in effect when the activity covered by the fee will be
  performed. Audit fees are those in effect on the date we will begin
  our audit.

B. Proposed Final Fee Schedule as Projected

    As explained above, OSHA has decided not to phase in the increase 
in fees for new applicants that apply after the effective date of the 
new fee schedule. These applicants, unlike currently recognized NRTLs 
or pending applicants, do not have a stake in the current fee schedule; 
new applicants are free to choose whether or not to participate in the 
program and would be charged the full amount of the fee increase. Table 
B represents the final fee schedule as currently projected. It shows 
the amounts that would be charged to new applicants immediately, and to 
existing NRTLs or pending applicants in the third and later years after 
this rule becomes effective. Table

[[Page 64037]]

B assumes that OSHA makes no additional adjustments during its annual 
review of the NRTL fees; in fact, however, it is likely that these fees 
will be adjusted during the annual fee review process.

 Table B--Fee Schedule Nationally Recognized Testing Laboratory Program
                      (NRTL Program): Fee Schedule
                 [Effective--if fully implemented] \12\
------------------------------------------------------------------------
                              Activity or category
                                 (fee charged per
       Type of service         application unless        Fee amount
                                noted otherwise)
------------------------------------------------------------------------
APPLICATION PROCESSING......  Initial Application   $17,750.
                               Review \1,\ \8\.
                              Expansion             $8,280.
                               Application Review
                               (per additional
                               site) \1,\ \8\.
                              Renewal or Expansion  $300.
                               (other) Application
                               Review \1\.
                              Renewal Information   $2,370.
                               Review Fee \7\.
                              Additional Review--   $2,370.
                               Initial Application
                               (if the application
                               is substantially
                               revised, submit one-
                               half Initial
                               Application Review
                               fee) \7\.
                              Additional Review--   $730.
                               Renewal or
                               Expansion
                               Application \7\.
                              Limited Review--      $3,550.
                               Initial Application
                               \7\.
                              Assessment--Initial   $4,440 + travel
                               Application (per      expenses.
                               person, per site--
                               first day) \2,\
                               \10\.
                              Assessment--Renewal   $4,140 + travel
                               Application (per      expenses.
                               person, per site--
                               first day) \3,\
                               \10\.
                              Assessment--Expansio  $3,550 + travel
                               n Application         expenses.
                               (additional site)
                               (per person, per
                               site--first day)
                               \3\.
                              Assessment--Expansio  $2,960 + travel
                               n Application         expenses.
                               (other) (per
                               person, per site--
                               first day) \3\.
                              Assessment--each      $1,180 + travel
                               addnl. day or each    expenses.
                               day on travel (per
                               person, per site)
                               \2,\ \3\.
                              Review & Evaluation   $30 per standard OR
                               \5\ ($30 per          $296 per standard.
                               standard if it is
                               already recognized
                               for NRTLs and
                               requires minimal
                               review; OR else
                               $296 per standard).
                              Final Report/         $19,520.
                               Register Notice--
                               Initial Application
                               \5,\ \9\.
                              Final Report/         $7,390.
                               Register Notice--
                               Renewal or
                               Expansion
                               Application (if
                               OSHA performs on-
                               site assessment)
                               \5,\ \9\.
                              Final Report/         $4,440.
                               Register Notice--
                               Renewal or
                               Expansion
                               Application (if
                               OSHA performs NO on-
                               site assessment)
                               \5,\ \9\.
AUDITS......................  On-site Audit (per    $7,400 + travel
                               person, per site,     expenses.
                               first day) \6\.
                              On-site Audit--each   $1,180 + travel
                               addnl. day or each    expenses.
                               day on travel (per
                               person, per site)
                               \6\.
                              Office Audit (per     $1,180.
                               person, per site)
                               \6\.
MISCELLANEOUS...............  Supplemental Travel   $1,000.
                               (per site--for
                               sites located
                               outside the 48
                               contiguous States
                               or the District of
                               Columbia) \4\.
                              Supplemental Program  $590.
                               Review (per program
                               requested) \4\.
                              Fees Invoice          $300.
                               Processing (per
                               application or
                               audit) \4\.
                              Travel Document       $890.
                               Processing (6
                               hours, per
                               application or
                               audit) \4\.
                              Late Payment \11\...  $150.
                              Comp Time (per hour)  $56.40.
                               \10\.
------------------------------------------------------------------------
The Notes to Table B would be the same as shown for Table A above,
  except for the fee amounts included in notes 2, 3, 6, and 7.

VII. Description of Fees

    The following is a description of the major tasks and functions 
currently covered by each type of fee category, e.g., application fees, 
and the basis used to charge each fee. A description already included 
in the notes to the fee schedule is not repeated below.
    Application Fees: This fee reflects the technical work performed by 
office and field staff in reviewing application documents to determine 
whether an applicant submitted complete and adequate information. The 
application review does not include a determination on the test 
standards requested, which is reflected in the Review and Evaluation 
fee. Application fees are based upon the average cost per type of 
application. OSHA uses an average cost since the amount of time spent 
on the application review does not vary greatly by type of application. 
This is based on the premise that the number and type of documents 
submitted will generally be the same for a given type of application. 
Experience has shown that most applicants follow the application guide 
that OSHA provides to them.
    Assessment Fees: This fee is different for the initial, renewal, 
expansion (site) and expansion (other) applications. It is based on the 
number of days for staff preparatory and on-site work and related 
travel. Six types of fees are shown, and five are charged per site and 
per person. The four fees for the first day reflect time for office 
preparation and 8 hours at the applicant's facility. There is one fee 
covering either additional days at the facility and/or days in travel. 
Additional days or days in travel are assessed for either a half or a 
full day. A supplemental travel amount is assessed for travel outside 
the contiguous 48 states or the District of Columbia. For initial 
applications, an amount to cover the assessment must be submitted ``up-
front'' with the application. In addition to the first day and 
additional day amounts, the applicant or NRTL must pay actual travel 
expenses, based on government per diem and travel rules. For initial 
applications, any difference between actual travel expenses and the up-
front travel amount is reflected in the final bill or refund sent to 
the applicant.
    Similar to the application fee, the office preparation time 
generally involves the same types of activities. Actual time at the 
facility may vary, but the staff devote at least a full day for 
performing the on-site work. The fee for the additional day reflects 
time spent at the facility and the actual travel expenses for that day.
    Review and Evaluation Fee: This fee is charged per test standard 
(which is part of an applicant's proposed scope of recognition). The 
fee reflects the fact that staff time spent during the office review of 
an application varies mainly in accordance with the number of test 
standards requested by the applicant. In general, the fee is based on 
the estimated time necessary to review test standards to determine 
whether each one is ``appropriate,'' as defined in 29 CFR 1910.7, and 
whether each test standard covers equipment for which OSHA mandates 
certification by an NRTL. The fee also covers time to

[[Page 64038]]

determine the current designation and status (i.e., active or 
withdrawn) of a test standard by reviewing current directories of the 
applicable test standard organization. Furthermore, it includes time 
spent discussing the results of the application review with the 
applicant. The actual time spent will vary depending on whether an 
applicant requests test standards that have previously been approved 
for other NRTLs. When the review is minimal, these activities take 
approximately 2 hours for 10 standards, or $30 per standard. When the 
review is more substantial, the estimated average review time per 
standard is one hour for each standard, which translates to $296 per 
standard. Substantial review will occur when the standard has not been 
previously recognized for any NRTL or when the NRTL is proposing to do 
testing in a ``new'' area, i.e., for a type of product not similar to 
any currently included under its scope of recognition.
    Final Report/Register Notice Fees: Each of these fees are charged 
per application. The fee reflects the staff time to prepare the report 
of the on-site review of an applicant's or an NRTL's facility, which 
includes contacting the applicant or NRTL to discuss issues or items in 
its response to our findings during our assessment. The fee also 
reflects the time spent making the final evaluation of an application, 
preparing the required Federal Register notices, and responding to 
comments received in response to the preliminary finding notice. These 
fees are based on average costs per type of application, since the type 
and content of documents prepared are generally the same for each type 
of applicant. There is a separate fee when OSHA does not perform an on-
site assessment. In these cases, the NRTL Program staff perform an 
office assessment and prepare a memo to recommend the expansion or 
renewal.
    Audit (Post-Recognition Review) Fees: These fees reflect the time 
for office preparation, time at the facility and travel, and time to 
prepare the report of the on-site audit. A separate fee is shown for an 
office audit conducted in lieu of an actual visit. Each fee is per site 
and does not generally vary for the same reasons described for the 
assessment fee and because the audit is generally limited to between 
one and two days. As previously described, the audit fee includes 
amounts for travel, and, as with assessments, OSHA will bill the NRTL 
for actual travel expenses.
    Miscellaneous Fees: The sample fee schedule only shows the average 
cost for one full day of staff time. OSHA uses this fee primarily in 
cases of refunding the assessment fee. OSHA will also charge a fee for 
late payment of the annual audit fee. The amount for the late fee is 
based on 1 hour of staff time charged at the fully implemented rate.
    Also shown is a fee for Supplemental Program Review, which 
represents the time OSHA needs to review the documents that the NRTL 
submits to show how it meets our criteria for use of a supplemental 
program. Under each program, NRTLs can use other qualified parties or 
facilities to perform the specific tasks that are covered by the 
program and that are necessary for product testing and certification.

VIII. Major Changes to the Fee Schedule

    The following table shows the major adjustments (i.e., increases or 
decreases of $100 or more) that we propose to make to the fee schedule 
in Table A as compared to the current fee schedule.\10\
---------------------------------------------------------------------------

    \10\ Our current fee schedule is available on the OSHA Web site.

                                   Table of Major Adjustments to Fee Schedule
----------------------------------------------------------------------------------------------------------------
                                                              Proposed fee amount--
   Description of activity or        Current fee amount        first year increase     Proposed fee amount--full
            category                                                                            increase
----------------------------------------------------------------------------------------------------------------
Initial Application Review.....  $5,100...................  $17,750..................  $17,750.
Expansion Application Review...  $1,020...................  $3,420...................  $8,280.
Additional Review--Initial       $1,020...................  $2,370...................  $2,370.
 Application.
Renewal Application Information  $1,020...................  $1,470...................  $2,370.
 Review.
Additional Review--Renewal or    $510.....................  $730.....................  $1,180.
 Expansion Application.
Limited Review--Initial          $0.......................  $3,550...................  $3,550.
 Application.
Assessment--Initial Application  $1,910...................  $4,440...................  $4,440.
 (per person, per site--first
 day.
Assessment--Renewal Application  $1,790...................  $2,570...................  $4,140.
 (per person, per site--first
 day).
Assessment--Expansion            $1,530...................  $2,200...................  $3,550.
 (additional site) (per person,
 per site--first day).
Assessment--Expansion (other)    $1,280...................  $1,830...................  $2,960.
 (per person, per site--first
 day).
Assessment--each addnl. day OR   $510.....................  $1,180 (new                $1,180.
 travel time--each day (per                                  applications); $730
 person, per site).                                          other applications.
Review & Evaluation............  $13 per standard.........  $30 per standard.........  $30 per standard.
Final Report/Register Notice--   $8,420...................  $19,520..................  $19,520.
 Initial Application.
Final Report/Register Notice--   $3,190...................  $4,580...................  $7,390.
 Renewal or Expansion
 Application (if OSHA performs
 on-site assessment).
Final Report/Register Notice--   $1,910...................  $2,740...................  $4,440.
 Renewal or Expansion
 Application (if OSHA performs
 NO on-site assessment).
On-site Audit (first day)......  $2,680...................  $4,240...................  $7,400.
Supplemental Program Review....  $260.....................  $270.....................  $590.
Invoice Processing.............  $130.....................  $300.....................  $300.
----------------------------------------------------------------------------------------------------------------

    Clarification About Travel Expenses Fee. The fee schedule states 
that OSHA will charge for time on travel following government travel 
rules. Those rules currently permit a traveler to earn a special type 
of overtime called Compensatory Time For Travel, or simply travel comp 
time. This time is generally earned when the traveler is engaged in 
government business beyond his or her regular work schedule. The travel 
comp time amounts to earning time off as opposed to receiving an 
overtime payment. The amount of travel comp time will vary depending on 
the

[[Page 64039]]

specific circumstances of the travel. In general, it is greater for 
trips outside the contiguous 48 states than for trips within those 
states. This travel comp time exceeds an employee's regular work hours, 
i.e., the total available work hours (TAW) discussed under section IV, 
above. Because this time is specific to a particular trip, it will be 
included in the travel fee that OSHA charges for that trip. The travel 
comp time is not included in the total time used to develop the ECR, 
i.e., the TAS. Instead, it will be charged at the average rate for 
direct OSHA staff time, which would be $56.40 under the revised fee 
schedule.

IX. Proposed Changes to 29 CFR 1910.7(f)

    As noted earlier, 29 CFR 1910.7(f) provides the overall parameters 
for determining the fees. The rule states that OSHA will assess fees 
for the processing of applications for initial recognition, expansion 
of recognition, or renewal of recognition, review and evaluation of the 
applications, and preparation of reports, evaluations and Federal 
Register notices, and audits of sites. It further states that OSHA 
calculates the fees based on either the average or actual time required 
to perform the work necessary, the staff costs per hour, and the 
average or actual costs for travel when on-site reviews are involved. 
29 CFR 1910.7(f)(1) and (2). In addition, the rule states that OSHA 
will review costs annually and will propose a revised fee schedule, if 
warranted. OSHA proposes to replace the reference to an ``annual'' 
review with a ``periodic'' review to allow for more flexibility in 
adjusting fees where appropriate. OSHA does not expect that it would 
review the fee schedule more than once annually, but anticipates 
situations where the review of costs may not be fully completed within 
a single-year period.
    OSHA is proposing to make a small change to the language in 
paragraph (f) to clarify the basis used for calculating fees, 
consistent with OMB Circular A-25. Specifically, when discussing the 
``costs'' that the agency charges, OSHA will make clear that it means 
the ``full'' costs of performing the activities that benefit the NRTLs. 
Thus, as revised, the proposed paragraph (f)(2) would read: ``The fee 
schedule established by OSHA reflects the full cost of performing the 
activities for each service listed in paragraph (f)(1) of this 
section.'' (Emphasis added). Similarly, OSHA proposes to revise 
paragraph (f)(3)(i) to clarify that the two references to the cost of 
the program mean the full cost of the program.
    OSHA is also proposing to change the language in paragraphs 29 CFR 
1910.7(f)(1) and (4) to require advance payment of the fees. The first 
sentence of 29 CFR 1910.7(f)(1) would be revised to specify that NRTLs 
must pay all applicable fees in advance. In addition, the table in 29 
CFR 1910.7(f)(4), which sets out important billing periods and related 
actions, would be revised to accommodate the proposed advanced- billing 
process. Included in the proposed changes to this section is a revision 
of the amount of time that OSHA must wait before publishing its 
intention to revoke its recognition of NRTLs that have not paid their 
audit fees: ``60 days after the bill date'' would be changed to ``30 
days after due date.'' See ``III. Audit Fees'' in proposed 29 CFR 
1910.7(f)(4).

X. Preliminary Economic Analysis and Initial Regulatory Flexibility 
Analysis

    Executive Order (E.O.) 12866 and the Regulatory Flexibility Act 
(RFA), as amended in 1996, require Federal agencies to analyze the 
costs, and other consequences and impacts, including small business 
impacts, of their rules. Consistent with these requirements, OSHA has 
analyzed the costs of the proposed rule and the impacts of the rule on 
affected laboratories and small businesses.

Affected Industry

    When the Agency established its NRTL fee schedule in 2000, there 
were 17 NRTLs with 42 sites of operation. Today, there are 15 NRTLs 
(including two foreign-owned and operated NRTLs) with 49 sites (see 
Table C).

       Table C--Nationally Recognized Testing Laboratories (NRTLs)
------------------------------------------------------------------------
                                                                 Number
                          NRTL name                             of sites
------------------------------------------------------------------------
Canadian Standards Association (CSA).........................          6
Communication Certification Laboratory, Inc. (CCL)...........          1
Curtis-Straus LLC (CSL)......................................          1
FM Global Technologies LLC (FM)..............................          2
Intertek Testing Services NA, Inc. (ITSNA)...................         13
MET Laboratories, Inc. (MET).................................          1
National Technical Systems, Inc. (NTS).......................          1
NSF International (NSF)......................................          1
SGS U.S. Testing Co., Inc. (SGSUS)...........................          1
Southwest Research Institute (SwRI)..........................          1
TUV America, Inc. (TUVAM)....................................          3
TUV Product Services GmbH (TUVPSG)...........................          1
TUV Rheinland of North America, Inc. (TUV)...................          1
Underwriters Laboratories Inc. (UL)..........................         15
Wyle Laboratories, Inc. (WL).................................          1
                                                              ----------
    Total (15 NRTLs).........................................         49
------------------------------------------------------------------------
OSHA: Directorate of Technical Support and Emergency Management.

Costs

    The Agency had estimated in 2000 that approximately $239,000 in 
fees would be collected annually (65 FR 46815). OSHA most recently 
updated its fees in February 2007, and showed total estimated program 
costs of approximately $755,000 (72 FR 7469), only about half of which 
(about $380,000) would have been collected through the 2007 updated 
fees. As Figure 1, above, shows, revising the approach of calculating 
OSHA costs and updating Federal-employee salary levels will increase 
the fees collected to about $1,152,000. In comparison, if costs were 
updated using the original approach of calculation (without adjustment 
for ancillary activities and leave), and included the increase in staff 
resources, the total fees collected would have increased to about 
$583,000. The impact of the revised approach on all existing NRTLs is 
$772,000 ($1,152,000 minus $380,000). The actual impact on these NRTLs 
would be less because some of the increase will be paid by new 
applicants.

Economic Impacts

    The proposed fee increase represents a tiny impact on industry 
revenues and profits. NAICS 54138 Testing Laboratories had $8.77 
billion in revenues in 2002 (2002 Bureau of Economic Census publication 
EC02-54A-1 US), and the Agency estimates that revenues in 2006 have 
grown to approximately $11.0 billion. In the 2000 rulemaking, as here, 
the Agency estimated that net before-tax profits were 5.7 percent of 
revenues (Robert Morris Associates, Annual Statement Studies). The 
Agency, therefore, estimates 2006 industry before-tax profits as $627 
million (5.7% of $11 billion). Even the entire $1.15 million in user 
fees represents 0.000104, or 0.0104 percent, of industry revenues 
($1.15 million/$11 billion) and 0.0018, or 0.18 percent, of industry 
profits (1.15/627). The impact of the additional, new user fees of 
$772,000 would be even less. The Agency concludes that imposition of 
higher user fees is economically feasible for the industry.

[[Page 64040]]

    Average cost per affected firm of the higher NRTL fees is about 
$76,867 ($1,152,000/15); while average cost per affected NRTL 
establishment (site) is about $23,510 ($1,152,000/49). Larger firms 
with more recognized sites are expected to have higher total user fees. 
The Agency believes that higher proposed NRTL user fees would have 
little, if any, impact on the affected firms. Demand for NRTL services 
continues to grow and there was no apparent adverse affect of the 
imposition of the NRTL fees in 2000.
    Any impact on the NRTLs would hinge on whether or not they can 
raise prices to their customers. The Agency believes that there are no 
good substitutes for the certification supplied by NRTLs, and that it 
is likely that the higher user fees would be passed on to the very 
large number of NRTL customers via small price increases. The Agency 
preliminarily concludes that the new, higher NRTL fees will have little 
economic impact on the affected firms and establishments.

Regulatory Flexibility Act Certification

    Under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.), 
federal agencies must assess the impact of their proposed rules on 
small entities and prepare an initial regulatory flexibility analysis 
unless the head of the agency can certify that the rule will not, if 
promulgated, have a significant economic impact on a substantial number 
of small entities. Thus, the Agency has also estimated the relative 
effect of the new user fees on small businesses. In the original fees 
rulemaking in 2000, small businesses were defined as those with less 
than $5 million in sales (the Small Business Administration criterion 
for the industry). These businesses have fewer than 100 employees and 
average revenue of about $2.4 million. User fees were estimated to be 
about $6,000 per ``small'' testing laboratory, which was less than 0.3 
percent of average small business revenues and less than 5 percent of 
before-tax profits (Table 6, 65 FR 46817). The February 15, 2007, 
revision raised the average establishment's fee to about $7,700 
($380,000/49). The higher user fees proposed by the Agency herein 
increases the expected average user fee for a small testing laboratory 
to about $23,500.
    Revenues for the industry have also increased, from $5 billion in 
1992 to an estimated $11 billion in 2006 (1992 and 2002 Economic 
Census). Similarly, the SBA size criterion of a small business in the 
testing laboratory industry has increased to $11 million in annual 
revenues (SBA Web site). The Agency estimates that the new user fees 
still represent less than 1 percent of revenues and 5 percent of 
profits for small businesses in this industry. The marginal increase in 
user fees, which is about $15,800 per testing laboratory (to $23,500 
from $7,700), is an even smaller fraction of current revenues and 
profits. The economic costs are less than 1 percent of revenues and 5 
percent of before-tax profits, and the Agency believes that the costs 
will be passed on to the firms' customers. The Agency, therefore, 
certifies that the proposed higher NRTLs fees will not have a 
significant impact on a substantial number of small entities. The 
Agency has preliminarily concluded that 13 of the 15 affected NRTLs are 
small entities, as defined by SBA size criterion.
    Finally, as noted in the 2000 rulemaking, the collection of user 
fees from NRTLs is not a new cost to society, but represents a transfer 
of the governmental cost of the NRTL Program from taxpayers to an 
industry directly consuming government services.

References

1. U.S. Department of Commerce, Bureau of the Census, 1992 Census of 
Service Industries: Industry Series: SC92-S-1, -4, -5. Washington, 
DC, February 1995.
2. U.S. Department of Commerce, Bureau of the Census, Economic 
Census, 2002, publication EC02-54A-1 US.
3. Risk Management Associates (formerly Robert Morris Associates), 
Annual Statement Studies, September 1995.
4. U.S. Small Business Administration Web site http://www.sba.gov. 
Table of Small Business Size Standards Matched to North American 
Industry Classification System Codes http://www.sba.gov/idc/groups/public/documents/sba_homepage/serv_sstd_tablepdf.pdf.

XI. Unfunded Mandates Reform Act

    For the purposes of the Unfunded Mandates Reform Act of 1995 (2 
U.S.C. 1501, et seq.), this rule does not include any federal mandate 
that may result in increased expenditures by State, local, or tribal 
governments, or an increased expenditure by the private sector of more 
than $100 million.

XII. Paperwork Reduction Act

    This rule does not impose or remove any information collection 
requirements for purposes of the Paperwork Reduction Act of 1995, 44 
U.S.C. 3501-30.

XIII. Federalism

    OSHA has reviewed this proposed rule in accordance with Executive 
Order 13132. This final rule would only set fees for services provided 
by the Federal government to private entities and has no impact on 
Federalism. The rule does not limit or restrict State policy options.

XIV. State Plan States

    The 26 States and territories with their own OSHA-approved 
occupational safety and health plans are not affected by this final 
rule. These 26 States and territories include: Alaska; Arizona; 
California; Hawaii; Indiana; Iowa; Kentucky; Maryland; Michigan; 
Minnesota; Nevada; New Mexico; North Carolina; Oregon; Puerto Rico; 
South Carolina; Tennessee; Utah; Vermont; Virginia; Washington; and 
Wyoming; all of which operate plans covering both private and public 
sector employees. Connecticut, New Jersey, New York, and the Virgin 
Islands have OSHA-approved State Plans that apply to State and local 
government employees only.

XV. Public Participation

    OSHA invites comments on all aspects of the proposed rule. OSHA 
will carefully review and evaluate these comments, information, and 
data, as well as all other information in the rulemaking record, before 
it decides how to proceed.
    You may submit comments in response to this document (1) 
Electronically at http://www.regulations.gov, which is the Federal 
eRulemaking Portal; (2) by facsimile (FAX); or (3) by hard copy. All 
comments, attachments and other material must identify the Agency name 
and the OSHA docket number for this rulemaking. You may supplement 
electronic submissions by uploading document files electronically. If, 
instead, you wish to mail additional materials in reference to an 
electronic or fax submission, you must submit three copies to the OSHA 
Docket Office (see ADDRESSES section). The additional materials must 
clearly identify your electronic comments by name, date, and docket 
number so OSHA can attach them to your comments.
    Because of security-related procedures, the use of regular mail may 
cause a significant delay in the receipt of comments. For information 
about security procedures concerning the delivery of materials by hand, 
express delivery, messenger or courier service, please contact the OSHA 
Docket Office at (202) 693-2350 (TTY (877) 889-5627).
    Comments and submissions in response to this Federal Register 
notice are posted without change at http://www.regulations.gov. 
Therefore, OSHA cautions commenters about submitting personal 
information such as Social Security numbers and date of birth.

[[Page 64041]]

    Although all submissions in response to this Federal Register 
notice and exhibits referenced in this Federal Register notice are 
listed in the http://www.regulations.gov and/or http://dockets.osha.gov 
indexes, some information (e.g., copyrighted material) is not publicly 
available to read or download through those Webpages. All submissions 
and exhibits, including copyrighted material, are available for 
inspection and copying at the OSHA Docket Office. Information on using 
http://www.regulations.gov to submit comments and access dockets is 
available at the Webpage's User Tips link. Contact the OSHA Docket 
Office for information about materials not available through the 
Webpage and for assistance in using the Internet to locate docket 
submissions.
    Electronic copies of this Federal Register document are available 
at http://www.regulations.gov. This document, as well as news releases 
and other relevant information, also are available at OSHA's Webpage at 
http://www.osha.gov.

XVI. List of Subjects

    Fees, Occupational safety and health, Product testing and 
certification, Safety, Testing laboratories.

XVII. Authority and Signature

    This document was prepared under the direction of Jordan Barab, 
Acting Assistant Secretary of Labor for Occupational Safety and Health, 
200 Constitution Avenue, NW., Washington, DC 20210. This action is 
taken pursuant to Section 8 of the Occupational Safety and Health Act 
of 1970 (29 U.S.C. 657); Secretary of Labor's Order No. 5-2007 (72 FR 
31160), and 29 CFR Part 1911. This action is also taken pursuant to the 
Independent Offices Appropriations Act (31 U.S.C. 9701); Public Law 
111-8; the Administrative Procedures Act (31 U.S.C. 553); 29 U.S.C. 9a; 
and OMB Circular A-25.

    Signed at Washington, DC, on November 30, 2009.
Jordan Barab,
Acting Assistant Secretary of Labor for Occupational Safety and Health.

XVIII. Proposed Changes

    For the reasons stated in the preamble of this proposed rule, OSHA 
is proposing to amend Subpart A of 29 CFR part 1910 as follows:

PART 1910--[AMENDED]

Subpart A--General--[Amended]

    1. The authority citation for Subpart A of part 1910 is revised to 
read as follows:

    Authority:  Sections 4, 6, and 8 of the Occupational Safety and 
Health Act of 1970 (29 U.S.C. 653, 655, 657); Secretary of Labor's 
Order No. 12-71 (36 FR 8754), 8-76 (41 FR 25059), 9-83 (48 FR 
35736), 1-90 (55 FR 9033), 6-96 (62 FR 111), 3-2000 (65 FR 50017), 
5-2002 (67 FR 65008), and 5-2007 (72 FR 31159), as applicable.
    Sections 1910.6, 1910.7, 1910.8 and 1910.9 are also issued under 
29 CFR Part 1911. Section 1910.7(f) is also issued under 31 U.S.C. 
9701, 29 U.S.C. 9a, 5 U.S.C. 553; Pub. L. 106-113 (113 Stat. 1501A-
222); Public Law 111-8; and OMB Circular A-25 (dated July 8, 1993) 
(58 FR 38142, July 15, 1993).
    2. In Sec.  1910.7, revise the first sentence of paragraphs (f)(1) 
and (f)(2) and revise paragraphs (f)(3)(i) and (f)(4) to read as 
follows:


Sec.  1910.7  Definition and requirements for a nationally recognized 
testing laboratory.

* * * * *
    (f) * * *
    (1) Each applicant for NRTL recognition and each NRTL must pay fees 
for services provided by OSHA in advance of the provision of those 
services. OSHA will assess fees for the following services:
* * * * *
    (2) The fee schedule established by OSHA reflects the full cost of 
performing the activities for each service listed in paragraph (f)(1) 
of this section. * * *
    (3)(i) OSHA will review the full costs periodically and will 
propose a revised fee schedule, if warranted. In its review, OSHA will 
apply the formula established in paragraph (f)(2) of this section to 
the current estimated full costs for the NRTL Program. If a change is 
warranted, OSHA will follow the implementation shown in paragraph 
(f)(4) of this section.
* * * * *
    (4) OSHA will implement periodic review, and fee assessment, 
collection, and payment, as follows:

------------------------------------------------------------------------
            Dates                           Action required
------------------------------------------------------------------------
                   I. Periodic Review of Fee Schedule
------------------------------------------------------------------------
When review completed........  OSHA will publish any proposed new Fee
                                Schedule in the Federal Register, if
                                OSHA determines changes in the schedule
                                are warranted.
Fifteen days after             Comments due on the proposed new Fee
 publication.                   Schedule.
When Fee Schedule is approved  OSHA will publish the final Fee Schedule
                                in the Federal Register, making it
                                effective.
------------------------------------------------------------------------
                     II. Application Processing Fees
------------------------------------------------------------------------
Time of application..........  Applicant must pay the applicable fees in
                                the Fee Schedule that are due when
                                submitting an application; OSHA will not
                                begin processing until fees are
                                received. OSHA may cancel an application
                                if the fees are not paid when due.
Before assessment performed..  Applicant must pay the estimated staff
                                time and travel costs for its assessment
                                based upon the fees in effect at the
                                time of the assessment. Applicant also
                                must pay the Final Report/Register
                                notice and other applicable fees, as
                                specified in the Fee Schedule. OSHA will
                                cancel an application if the fees are
                                not paid when due.
------------------------------------------------------------------------
                             III. Audit Fees
------------------------------------------------------------------------
Before audit performed.......  NRTL must pay the estimated staff time
                                and travel costs for its audit based
                                upon the fees in effect at the time of
                                the audit. NRTL also must pay other
                                applicable fees, as specified in the Fee
                                Schedule. After the audit, OSHA adjusts
                                the audit fees to account for the actual
                                travel and staff time costs.
On due date..................  NRTLs must pay the estimated audit fees
                                or any balance due by the due date
                                established by OSHA; OSHA will assess a
                                late fee if audit fees (or any balance
                                of fees due) is not paid by the due
                                date. OSHA may still perform the audit.
Thirty days after due date...  OSHA will publish a notice in the Federal
                                Register announcing its intent to revoke
                                recognition for NRTLs that have not paid
                                the estimated audit fees and any balance
                                of fees due.
------------------------------------------------------------------------
For the purposes of 29 CFR 1910.7(f)(4), ``days'' means ``calendar
  days,'' and ``applicant'' means ``the NRTL'' or ``an applicant for
  NRTL recognition.''


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[FR Doc. E9-28958 Filed 12-4-09; 8:45 am]
BILLING CODE 4510-26-P