[Federal Register Volume 87, Number 177 (Wednesday, September 14, 2022)]
[Proposed Rules]
[Pages 56373-56381]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-19560]


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DEPARTMENT OF TRANSPORTATION

National Highway Traffic Safety Administration

49 CFR Part 594

[Docket No. NHTSA-2022-0081]
RIN 2127-AL74


Schedule of Fees

AGENCY: National Highway Traffic Safety Administration (NHTSA), 
Department of Transportation (DOT).

ACTION: Notice of proposed rulemaking.

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SUMMARY: This document proposes fees for Fiscal Year (FY) 2023 and 
future FYs relating to the registration of importers and the 
importation of motor vehicles not certified as conforming to the 
Federal motor vehicle safety standards (FMVSS). In addition to 
proposing new fee amounts, this document also proposes three 
modifications to existing provisions of part 594. The first seeks to 
modify our assessment of the administrative costs of registered 
importer (RI) renewals by authorizing collection of inspection costs as 
part of the inspected entity's monthly invoice instead of adding those 
costs to its annual renewal fee. The second proposal would seek to 
adjust how a vehicle inspection fee is determined in cases where an RI 
requests inspection of a vehicle subject to an eligibility petition. 
Finally, the third proposal would clarify circumstances in which NHTSA 
(the Agency) would charge additional fees for submission of conformity 
packages with errors or omissions. The fees in this update are mandated 
by statute and are necessary to maintain the RI program.

DATES: You should submit your comments early enough to ensure that 
Docket Management receives them not later than September 29, 2022.

ADDRESSES: Comments should refer to the docket and notice numbers above 
and be submitted by any of the following methods:
     Federal eRulemaking Portal: Go to http://www.regulations.gov. Follow the online instructions for submitting 
comments.
     Mail: Docket Management Facility: U.S. Department of 
Transportation, 1200 New Jersey Avenue SE, West Building Ground Floor, 
Room W12-140, Washington, DC 20590-0001.
     Hand Delivery or Courier: West Building Ground Floor, Room 
W12-140, 1200 New Jersey Avenue SE, between 9 a.m. and 5 p.m. ET, 
Monday through Friday, except Federal holidays.
     Fax: 202-493-2251.
    Instructions: For detailed instructions on submitting comments and 
additional information on the rulemaking process, see the Public 
Participation heading of the SUPPLEMENTARY INFORMATION section of this 
document. Note that all comments received will be posted without change 
to http://www.regulations.gov, including any personal information 
provided. Please see the Privacy Act heading below.
    Docket: For access to the docket to read background documents or 
comments received, go to http://www.regulations.gov or to the street 
address listed above. Follow the online instructions for accessing the 
dockets.

FOR FURTHER INFORMATION CONTACT: Neil Thurgood, Office of Vehicle 
Safety Compliance, NHTSA at 202-366-5291. For legal issues, you may 
call Thomas Healy, Office of Chief Counsel, NHTSA at 202-366-2992.

SUPPLEMENTARY INFORMATION:

I. Introduction

What action is NHTSA taking?

    The Imported Vehicle Safety Compliance Act of 1988, which took 
effect on January 31, 1990, established new requirements for the 
importation of vehicles that had not been certified as meeting 
applicable FMVSS. On and after that date, motor vehicles not 
manufactured to conform to the FMVSS may be imported on a permanent 
basis only by a person or entity known as a ``registered importer'' 
(RI) that has registered with NHTSA, or by persons who have contracts 
with RIs to perform conformance work. RIs are regulated by NHTSA and 
modify nonconforming vehicles to meet U.S. safety standards. Under the 
statutory scheme, the Agency must first determine that the 
nonconforming vehicle is eligible for importation. Eligible vehicles 
are accompanied by a bond given to secure the performance of the 
conformance work, or, if the vehicle is not brought into full 
conformance, to ensure its exportation or abandonment to the United 
States at no cost to the Federal government.
    NHTSA must impose fees to cover administrative costs incurred in 
administering the registered importer program. 49 U.S.C. 
30141(a)(1)(B)(3) and (e) direct NHTSA to establish fees to cover the 
costs of carrying out the registration program for importers, 
processing the vehicle bonds, and making import eligibility 
determinations. Section 30141(e) states that these fees must be 
reviewed and adjusted at least every 2 years and that the fees for a FY 
must be established before the FY in question.

[[Page 56374]]

    On September 29, 1989, NHTSA issued 49 CFR part 594, establishing 
the initial fees authorized by the Imported Vehicle Safety Compliance 
Act of 1988. NHTSA has subsequently revised the fee schedules 
consistent with the directive that the fees be updated. NHTSA last set 
fees for FY 2015 and later through a final rule published in the 
Federal Register on September 24, 2014 (79 FR 57002). That final rule 
was preceded by a Notice of Proposed Rulemaking (NPRM) published on 
July 31, 2014, (79 FR 44363) in which the Agency explained that the 
methodology employed for calculating the fees and a more fulsome 
explanation of the regulatory history of fee setting could be found in 
a notice published on June 24, 1996 (61 FR 32411).
    NHTSA is directed by statute to periodically review and make 
appropriate adjustments in the fees established for the administration 
of the RI program. See 49 U.S.C. 30141(e). The fees applicable in any 
FY are to be established before the beginning of such year. Id. The 
fees established in this proposed rule would come into effect beginning 
with FY 2023, which begins on October 1, 2022. A table comparing 
current fees with the fee amounts proposed in this update follows this 
section.
    The statute authorizes fees to cover the costs of administering the 
importer registration program, of making import eligibility decisions, 
of reviewing vehicle-specific conformity documentation (conformity 
packages) submitted by RIs, and of processing the bonds furnished to 
the Department of Homeland Security (Customs and Border Protection, 
hereafter referred to as Customs).
    The volume of nonconforming vehicles imported into the United 
States, primarily from Canada, has been steadily increasing in the 
years that have elapsed since these fees were last updated. In the 2014 
calendar year (CY), 71 registered importers facilitated the importation 
of approximately 73,800 vehicles. By CY 2016, the number of RIs had 
risen to 87 and slightly more than 300,000 vehicles were processed by 
these RIs. The volume of imported vehicles held steady around 300,000 
for the years that followed. In CY 2020, a year in which many 
businesses were shuttered or operating at decreased capacity owing to 
the COVID-19 public health crisis, 121 RIs still managed to import over 
300,000 vehicles, and the total in CY 2021 exceeded 370,000. This 
protracted, large increase in volume has strained Agency resources 
while concurrently increasing NHTSA's concerns about enforcement. The 
increased numbers of conformity packages have required the Agency to 
authorize overtime, divert employees assigned to other tasks, and take 
other measures to complete timely reviews. While RIs have been 
submitting their conformity packages electronically as a temporary 
measure during the COVID-19 public health crisis, the bulk of these 
packages have historically been prepared in hard copy on paper. To 
reduce burdens associated with both preparing and processing conformity 
packages, NHTSA is currently developing a system that will serve as a 
permanent avenue for submitting conformity packages electronically 
rather than in hard copy.
    Enforcement concerns have prompted the Agency to perform more 
inspections of RI facilities and records to ensure compliance and to 
initiate suspensions against RIs found to be operating in violation of 
the statutes and regulations administered by NHTSA. Actions to revoke 
or suspend RIs incur costs that are recoverable as a component of the 
RI annual fee. Five RIs were suspended in CY 2021, and the costs of 
those suspensions have been considered in calculation of the updated RI 
maintenance fee. Other ongoing investigative matters that conclude 
after this update will be considered in the next cyclical update to the 
schedule of fees.

                             Table I--Comparison of Current and Updated Fee Amounts
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                                                                    Current         Update         Difference
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Registration/Renewal:
    New Applications *........................................            $333            $437              $104
    Application Renewal *.....................................             215             488               273
    RI Program Maintenance....................................             511           3,131             2,620
    Total Registration Application............................             844           3,568             2,724
    Total Registration Renewal................................             726           3,619             2,893
Petitions for Eligibility:
    Substantially Similar *...................................             175             320               145
    Capable *.................................................             800           1,280               480
Vehicle Importations:
    Non-Canadian Substantially Similar........................             138             273               135
    Non-Canadian Capable......................................             138             273               135
    Administrator initiated...................................             125             125                 0
Bond Processing:
    HS-474....................................................            9.34           11.20              1.86
    Cash Deposits.............................................             499             499                 0
Processing Conformity Certificate:
    Paper Entry...............................................              10              21                11
    ABI Entry.................................................               6              14                 8
    ABI Entry W/Errors........................................              57              58                 1
    Indirect Costs--Overhead..................................           25.73           42.25             16.52
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* Does not include associated inspection costs.


[[Page 56375]]

II. Requirements of the Fee Regulation

Section 594.6--Annual Fee for Administration of the Importer 
Registration Program

    49 U.S.C. 30141(a)(3) directs that RIs must pay the annual fees 
established ``to pay for the costs of carrying out the registration 
program for importers. . . .'' This fee is payable by both new 
applicants and by existing RIs. To maintain its registration, each RI, 
at the time it submits its annual fee, must also file a statement 
affirming that the information it furnished in its registration 
application (or in later submissions amending that information) remains 
correct. See 49 CFR 592.5(f).
    The regulation establishing the annual fees for facilitating 
registration of importers is found in 594.6. The initial annual fee for 
a new registrant contains three components for which both direct and 
indirect costs are to be recovered. The first component covers the cost 
of processing an application submitted by a person seeking to become a 
registered importer (49 CFR 594.6(a)(1)). The second component covers 
costs attributable to any necessary inspection of an applicant's 
facilities (49 CFR 594.6(a)(2)) and the third component covers the 
remaining costs (49 CFR 594.6(a)(3)). The first and third components 
are paid with the initial application. All inspection costs incurred 
before consideration of an initial application are payable by the end 
of the tenth calendar day after notification by the Agency (See 54 FR 
40100, 40102, September 29, 1989, and 49 CFR 594.6(c)). Renewal fees 
after the initial fee have the same three components--processing costs, 
inspection costs and remaining costs (49 CFR 594.6(e)).
    Section 594.6 also addresses the annual fees associated with 
continuous administration of the RI program. These costs include 
calculating, revising, and publishing the fees to apply in the next FY, 
processing and reviewing annual RI renewal statements, processing the 
annual fee, processing and reviewing changes to an RI's registration, 
conducting inspections to verify RIs are complying with regulations, 
and acting to suspend or revoke RI registrations (49 CFR 594.6(f)). The 
direct and indirect costs that NHTSA recovers for renewal applications, 
administration, and maintenance of the RI program are defined in Sec.  
594.6(g) and (h).
    Direct costs are the estimated costs of professional and clerical 
staff time, computer and computer operator time, and postage dedicated 
to processing renewals and administering the registration, per RI. 
Under 49 CFR 592.6(j), the Agency may inspect a facility and the 
records that the RI must keep in fulfillment of its program 
responsibilities. Thus, the direct costs included in establishing the 
annual fee for a specific RI include costs of transportation and per 
diem attributable to inspections of that RI for administration of the 
registration program (to the extent those costs were not included in a 
previous annual fee) (49 CFR 594.6(g)).
    Indirect costs included in renewing RI registrations include a pro 
rata allocation of the average benefits of persons employed in 
processing annual statements, or changes thereto, in recommending 
continuation of RI status, and a pro rata allocation of the costs 
attributable to maintaining the office space, computer systems and 
related items (49 CFR 594.6(h)). This update includes the to-date 
development costs of a computer system being developed to aid in 
cataloging information and reports related to RIs' registration records 
and activities. This cost will be distributed across all active RIs 
(121 as of the writing of this notice) and included in the maintenance 
fee for active registered importers with the goal that total 
development cost will be recovered after four years.
    Historically, costs attributable to suspension and revocation 
actions have been included as an element of the program maintenance 
portion of the application and renewal fees, and have been composed of 
the direct and indirect costs attributable to investigation of the 
offending RI, as well as preparation of, distribution of, and reviewing 
responses to orders to show cause. Past fee updates typically covered 
two-year periods covering only one suspension or revocation. The five 
suspensions alluded to in the introduction happened in CY 2021 alone, 
and total $360,222.65 in direct and indirect costs to the Agency. In 
order to recover this amount over the two years this updated fee 
schedule is intended to cover, half of this amount is distributed 
across all RIs (121 present and any future) as a factor in the program 
maintenance cost that is ultimately included in both the registration 
and renewal fees.
    To comply with the statutory directive to set fees, we reviewed the 
existing fees and their bases to establish fees sufficient to cover 
costs. The initial component of the Registration Program Fee is the fee 
to cover expenses attributable to processing and acting upon 
registration applications. We have determined that this fee should be 
increased from $333 to $437 for new applications. The adjustments 
reflect our time expenditures in reviewing applications and account for 
the increase in direct costs relating to the increases in salaries of 
employees on the General Schedule and the increase in contractor costs 
to the Agency, as well as the increases in indirect costs attributed to 
the Agency's overhead costs. Based upon our review of these costs, the 
portion of the fee attributable to the maintenance of the registration 
program is $3,1318 for each RI, which includes a portion attributable 
to the costs of suspending a number of registrations, as well as a 
portion of development costs of the new RI recordkeeping and 
investigation system. When this figure is added to the proposed $437 
(representing the registration application component), the cost to a 
new applicant for RI status comes to $3,568, which is the fee we 
propose. This represents an increase of $2,724 over the existing fee.
    We must also recover costs attributable to reviewing of a 
participating RI's annual statement and verifying the continuing 
validity of information already submitted. We have determined that the 
fee for the review of the annual statement--essentially the RI 
``renewal fee''--should be increased from $215 to $488. When the $3,131 
maintenance portion is added to the $488 annual statement component, 
the total cost to an RI for renewing its registration comes to $3,619, 
which represents an increase of $2,893. The increase in these fees is 
attributable primarily to the increase in costs over the last 8 years 
since fees were last increased, including increased maintenance costs 
arising from multiple suspensions, as well as to the increase in direct 
costs relating to the increases in salaries of employees on the General 
Schedule, increases in indirect costs attributed to overhead, and the 
increase in the maintenance portion of the fee attributable to 
development of the new investigative/recordkeeping tool for 
administering the RI program.
    Authority for NHTSA to recover the costs of inspecting an RI's 
facility and examining an RI's records has been included in part 594 
since it was first promulgated in 1989. See 54 FR 40100, 40102, 
September 29, 1989. As originally conceived, these costs would be 
recovered in one of two ways. In the case of an inspection conducted 
for the purposes of reviewing an initial registration, the Agency 
indicated that it would bill the applicant for these costs and require 
payment before proceeding to final review of the application. Id. In 
the case of renewal applications, NHTSA indicated that the costs of 
inspections would be incorporated into

[[Page 56376]]

the administrative costs that would be recovered from the inspected RI 
as part of its renewal fee. Id.
    NHTSA is reaffirming that it will be including the cost of facility 
and recordkeeping inspections in the administrative costs that must be 
paid annually by an inspected RI. The Agency is, however, proposing 
that inspection costs be collected in the same fashion as inspection 
costs incurred in the initial application process. Therefore, an 
existing RI that has been inspected would be billed at the conclusion 
of the inspection, and would be subject to automatic suspension under 
49 CFR 592.7(a)(1) if the Agency did not receive payment within fifteen 
calendar days of the date of the invoice. As noted above, 49 CFR 
594.6(h) enumerates RI registration renewal indirect costs and provides 
that they represent a pro rata allocation of the average salary and 
benefits of employees who process the annual statements and perform 
related functions, and ``a pro rata allocation of the costs 
attributable to maintaining the office space, and the computer or word 
processor.'' See 49 CFR 594.6(h).
    The indirect costs that are currently in effect are $25.73. These 
costs represent hourly overhead expenses attributed to the average 
NHTSA employee. We are increasing this figure by $16.52, to $42.25. 
This increase is based on increases in enacted budgetary costs within 
the DOT since the fees were last adjusted, which are primarily 
attributable to increases in operating expenses for the Agency over the 
8 years since fees were last increased.

Sections 594.7, 594.8--Fees To Cover Agency Costs in Making Importation 
Eligibility Decisions

    49 U.S.C. Section 30141(a)(3)(B) requires that RIs pay other fees 
the Secretary of Transportation establishes to cover the costs of 
``making the [eligibility] decisions under this subchapter.'' This 
includes decisions on whether the vehicle subject to a petition for an 
eligibility determination is substantially similar to a motor vehicle 
that was originally manufactured for sale in the United States and 
certified by its original manufacturer as complying with all applicable 
FMVSS, and whether the vehicle is capable of being readily altered to 
meet those standards. Alternatively, where there is no substantially 
similar FMVSS-certified motor vehicle, the decision is made on whether 
the safety features of the subject vehicle comply with, or are capable 
of being altered to comply with, the FMVSS based on destructive test 
information or such other evidence that NHTSA deems to be adequate. 
These decisions are made in response to petitions submitted by RIs or 
manufacturers, under 49 CFR 593.5, or on the Administrator's own 
initiative under 49 CFR 593.8.
    The fee for a vehicle imported under an eligibility decision made 
in response to a petition is payable in part by the petitioner 
requesting the decision, and in part by RIs importing vehicles rendered 
eligible under that decision. As a result, the fee to be charged for 
reviewing the submitted package covering each imported vehicle includes 
the estimated pro rata share of the costs, both direct and indirect, 
borne upon the Agency in making all the eligibility decisions in a FY.
    Since we last amended the fee schedule, the overall number of 
vehicles imported by RIs has increased, while the number of petitions 
has decreased. The total number of vehicles imported by RIs over the 
period beginning with CY 2015 averaged 299,133 vehicles each year. Over 
the same period, the number of vehicles imported under an import 
eligibility petition that was submitted by an RI (as opposed to an 
import eligibility decision made on the Agency's initiative) was only 
1,408 or approximately 201 vehicles each year.
    Since the inception of the RI program, RIs have submitted 860 
petitions to NHTSA, averaging 29 per year. However, in CYs 2015 through 
2021, only 92 petitions were submitted by RIs, an average of about 12 
each year. As a result, the Agency has devoted less staff time to 
reviewing and processing import eligibility petitions since we last 
revised the fees.
    Despite these trends, however, increased direct and indirect costs 
since 2014, including costs associated with publication of notices in 
the Federal Register, will increase the pro rata share of petition 
costs assessed against the importer of each vehicle covered by the 
eligibility decision. We project that in each of the next two fiscal 
years, the Agency's annual costs for processing 12 petitions (the 
calculated annual average) will be $61,553.64. The petitioners, 
assuming the increased filing fees contemplated below, would pay $6,720 
of that amount in processing fees, leaving the remaining $54,833.64 to 
be recovered from the importers of the approximately 201 vehicles 
projected to be imported under petition-based import eligibility 
decisions. Dividing $54,833.64 by 201 yields a pro rata fee of 
approximately $273 for each vehicle imported under an eligibility 
decision that results from the granting of a petition. We are therefore 
proposing to increase the pro rata share of petition costs that are to 
be assessed against the importer of each vehicle from $138 to $273. The 
same $273 fee would be paid regardless of whether the vehicle was 
petitioned under 49 CFR 593.6(a), based on the substantial similarity 
of the vehicle to a FMVSS-certified model, or was petitioned under 49 
CFR 593.6(b), based on the safety features of the vehicle complying 
with, or being capable of being modified to comply with, all applicable 
FMVSS.
    The above analysis incorporates proposed increases in the currently 
established fees of $175 and $800 that cover the initial processing of 
``substantially similar'' petitions and petitions for vehicles that 
have no substantially similar U.S.-certified counterpart, respectively. 
These fees have not been adjusted over several iterations of fee 
updates, and therefore we propose to increase the fees to $320 and 
$1,280 for vehicles petitioned under 593.6(a) and 593.6(b), 
respectively. These adjustments more accurately reflect the costs 
associated with petition review and publication and maintain a ratio 
between petition costs paid by the petitioner and subsequent importers 
of the covered vehicles that is similar to the ratio found in earlier 
updates.
    An RI has not requested inspection of a petition vehicle in recent 
history, so there is little evidence to suggest that the fee covering 
such inspections must be adjusted outside of potential adjustments to 
account for inflation. However, in the interest of unifying the 
Agency's approach with respect to recovering inspection costs, NHTSA is 
proposing to change this from a flat fee to inclusion of costs of 
transportation, lodging, and per diem \1\ attributable to these 
inspections in the final petition review fee charged to the RI.
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    \1\ At standard CONUS rate as established by the General 
Services Administration.
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Section 594.9--Fee for Reimbursement of Bond Processing Costs and Costs 
for Processing Offers of Cash Deposits or Obligations of the United 
States in Lieu of Sureties on Bonds

    49 U.S.C. Section 30141(a)(3) requires a registered importer to pay 
any other fees the Secretary of Transportation establishes ``to pay for 
the costs of . . . processing bonds provided to the Secretary of the 
Treasury . . .'' upon the importation of a nonconforming vehicle to 
ensure that the vehicle will be brought into compliance within a 
reasonable time, or if it is not brought into compliance within such 
time, that it be exported, without cost to the United States, or 
abandoned to the United States.

[[Page 56377]]

    The Department of Homeland Security (Customs) exercises the 
functions associated with the processing of these bonds. To carry out 
the statute, we make a reasonable determination of the costs that 
Customs incurs in processing the bonds. The cost to Customs is based 
upon an estimate of the time that a GS-9, Step 5 employee spends on 
each entry, which Customs judged to be 20 minutes. To account for 
increases in General Schedule salary rates since this rule was last 
updated, we are increasing the processing fee from $9.34 per bond to 
$11.20.
    In lieu of sureties on a DOT conformance bond, an importer may 
offer United States money, United States bonds (except for savings 
bonds), United States certificates of indebtedness, Treasury notes, or 
Treasury bills (collectively referred to as ``cash deposits'') in an 
amount equal to the amount of the bond. See 49 CFR 591.10(a). The 
receipt, processing, handling, and disbursement of the cash deposits 
that have been tendered by RIs cause the Agency to consume considerable 
staff time and material resources. NHTSA has concluded that the expense 
incurred by the Agency to receive, process, handle, and disburse cash 
deposits may be treated as part of the bond processing cost, for which 
NHTSA is authorized to set a fee under 49 U.S.C. 30141(a)(3)(A). We 
first established a fee of $495 for each vehicle imported on and after 
October 1, 2008, for which cash deposits or obligations of the United 
States are furnished in lieu of a conformance bond. See the final rule 
published on July 11, 2008, at 73 FR 39890. The fee was later increased 
to $499 in 2014.
    In the years that have elapsed since this fee was last updated, 
there has been little demand on the part of RIs to submit cash deposits 
in lieu of conformance bonds. As we aim to maintain this fee in case it 
should prove useful in the future, the Agency considered its direct and 
indirect costs in calculating the fee for the review, processing, 
handling, and disbursement of cash deposits submitted by importers and 
RIs in lieu of sureties on a DOT conformance bond, and is proposing to 
maintain the fee of $499. NHTSA intends to revisit the methodology for 
calculating this review in a future update.

Section 594.10--Fee for Review and Processing of Conformity Certificate

    In a final rule published in the Federal Register on September 29, 
1997, NHTSA established a new fee for reviewing and processing 
conformity certificates (62 FR 50876). In the preamble to that final 
rule, the Agency explained that an annual volume of approximately 
21,000 conformity packages which had to be processed and reviewed had 
prompted consideration of amending part 594 to add the new fee to cover 
expenses. The new section added, 594.10, declared that each RI must pay 
a fee based on the direct and indirect costs for the review and 
processing of each certificate of conformity submitted to the Agency. 
Those direct and indirect costs, defined in 594.10(b) and (c), are 
identical to those set forth elsewhere in part 594. Section 594.10(c) 
declares that the indirect costs of processing conformity packages are 
allocated on a pro rata basis.
    In setting a value for this new fee, NHTSA calculated the direct 
costs (contract and professional staff time, computer costs, and costs 
for record assembly, marking, shipment, and storage) by surveying the 
resources being used to process and review 21,000 conformity packages 
each year. The analysis concluded that the work consumed annual staff 
time equivalent to 1.75 data entry personnel, .37 computer programmers 
and .90 safety and compliance analysts. Id. at 50880. Similar surveys 
were made of the costs in maintaining computer links with Customs, 
database maintenance, storage costs, shipping, and mail. NHTSA then set 
the direct cost component of the fee by dividing the sum of the direct 
costs by the number of conformity packages received. The identical 
methodology was used in calculating the indirect costs (benefits, 
rental and maintenance of office space and equipment, the use of office 
supplies, and other overhead items). Again, the costs incurred were 
divided by 21,000--the number of packages processed.
    NHTSA adjusted this fee in 1998 (63 FR 45183, Aug. 25, 1998), and 
again periodically, until it was last adjusted in 2014 (79 FR 57002, 
Sept. 24, 2014). Except for adding provisions recognizing savings 
realized when payments are made by credit card and instituting special 
fees to recover the extra costs incurred when packages are found to 
contain errors, the Agency's cost analyses appear to have remained 
unchanged from the time Sec.  594.10 was first instituted in 1997.
    As noted above, large increases in the volume of vehicles imported 
from Canada since 2015 have resulted in NHTSA receiving anywhere from 
250,000 to over 350,000 vehicle conformity packages annually. The 
Agency has responded to this increased volume by dedicating more 
resources to the task of reviewing those conformity packages. 
Accordingly, the methodology previously employed, which relied on 1997 
level resource expenditures being distributed on a pro rata basis over 
the number of conformity packages received, is no longer valid.
    For the purposes of this proposed rule, the Agency has calculated 
the costs of reviewing conformity packages by first assessing the 
resources now being applied to the task. The Agency calculated the 
direct cost of reviewing each conformity package as requiring a very 
conservative estimate of 10 minutes per package for a GS-12 step 5 
employee--which establishes an absolute floor attributable to labor 
cost of $8.15 \2\ per package. Storage costs of 26 cents ($0.26) were 
added to this processing cost, resulting in a review cost of $8.41 per 
conformity package. The annual cost of contract staff supporting the 
conformity review program imparts an additional direct cost of 
$975,378.01, which, when distributed over the annual expected volume of 
around 300,000 conformity packages submitted to NHTSA each year, 
amounts to approximately $3.25, which brings the total direct cost to 
$11.66 per conformity package.
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    \2\ This represents one-sixth of the hourly pay rate for a GS 12 
step 5 employee according to 2021 Washington DC locality pay
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    NHTSA then added the indirect costs for three full-time analysts 
and a portion of electronic development costs for a system being 
developed to facilitate electronic submission of conformity packages 
($460,504.50, which is one quarter of the to-date cost), and 
distributed this total, $796,217.94, over the estimated average of 
300,000 conformity packages submitted to NHTSA each year, arriving at 
indirect costs of $2.66 for each conformity package. Adding the direct 
costs of $11.66 and indirect costs of $2.66 per package yields a total 
cost of approximately $14.32 per package, which is the fee NHTSA 
proposes should be assessed in the simplest case, where the vehicle at 
issue has been entered electronically through the Automated Broker 
Interface (ABI) maintained by Customs, and the RI submitting the 
certificate is capable of corresponding by email and pays by credit 
card.
    The Agency is considering reducing the review fee assessed for 
conformity packages submitted through the electronic submission system 
that is currently under development. However, because it would be 
impossible at this stage to quantify savings to the government, and 
potentially to RIs, realized through use of this system, we

[[Page 56378]]

are instead soliciting comments on whether and how reducing this fee 
should be pursued.
    Other conformity packages that require additional handling and more 
cumbersome payment methods, amounting to approximately 50% additional 
review and handling time, incur additional costs. Accordingly, NHTSA is 
proposing to adjust the fee for these packages to 150% of the review 
fee assessed for the simpler packages, or approximately $21.
    Finally, because incomplete or incorrect conformity packages are 
posing a significant problem for the Agency, NHTSA must address the fee 
attributable to review of conformity packages that contain one or more 
errors. This fee is being increased slightly under the new methodology 
for determining review fees to $58 per problematic package from the 
previous level of $57. Additionally, in order to account for escalating 
costs attributable to repeated resubmission of erroneous conformity 
packages, NHTSA is proposing to modify Sec.  594.10(d) to clarify that 
the Agency reserves the right to assess the charge for each instance a 
conformity package is submitted containing errors, including instances 
in which a package is resubmitted with an error. Thus, the fee for 
reviewing packages containing errors is being adjusted to $58, which 
accounts for 45 minutes of review time and 150% increased processing 
and handling costs, and this fee may be assessed in each instance that 
an erroneous package is resubmitted.

III. Rulemaking Analyses

A. Executive Order (E.O.) 12866 (Regulatory Planning and Review), E.O. 
13563, and DOT Regulatory Policies and Procedures

    Executive Order 12866, ``Regulatory Planning and Review'' (58 FR 
51735, October 4, 1993), provides for making determinations as to 
whether a regulatory action is ``significant'' and therefore subject to 
Office of Management and Budget (OMB) review and to the requirements of 
the Executive Order. The Order defines a ``significant regulatory 
action'' as one that is likely to result in a rule that may:
    1. Have an annual effect on the economy of $100 million or more or 
adversely affect in a material way the economy, a sector of the 
economy, productivity, competition, jobs, the environment, public 
health or safety, or State, local, or Tribal governments or 
communities;
    2. Create a serious inconsistency or otherwise interfere with an 
action taken or planned by another agency;
    3. Materially alter the budgetary impact of entitlements, grants, 
user fees, or loan programs or the rights and obligations of recipients 
thereof; or
    4. Raise novel legal or policy issues arising out of legal 
mandates, the President's priorities, or the principles set forth in 
the Executive Order.
    NHTSA has considered the impact of this proposed rule under 
Executive Order 12866, E.O. 13563, and the DOT's regulatory policies 
and procedures. NHTSA has determined that the proposed rule is not 
significant under Executive Order 12866, E.O. 13563, and the DOT's 
regulatory policies and procedures. Based on the level of the fees and 
the volume of affected vehicles, NHTSA anticipates that the costs of 
this rule are so minimal as not to warrant preparation of a full 
regulatory evaluation.
    Furthermore, this action does not involve any substantial public 
interest or controversy. The rule will have no substantial effect upon 
State and local governments. There will be no substantial impact upon a 
major transportation safety program.

B. Regulatory Flexibility Act

    Pursuant to the Regulatory Flexibility Act (5 U.S.C. 601 et seq., 
as amended by the Small Business Regulatory Enforcement Fairness Act 
(SBREFA) of 1996), whenever an agency is required to publish a notice 
of proposed rulemaking for any proposed or final rule, it must prepare 
and make available for public comment a regulatory flexibility analysis 
that describes the effect of the rule on small entities (i.e., small 
businesses, small organizations, and small governmental jurisdictions). 
The Small Business Administration's regulations at 13 CFR part 121 
define a small business, in part, as a business entity ``which operates 
primarily within the United States.'' 13 CFR 121.105(a). No regulatory 
flexibility analysis is required if the head of an agency certifies 
that the rule will not have a significant economic impact on a 
substantial number of small entities. The SBREFA amended the Regulatory 
Flexibility Act to require Federal agencies to provide a statement of 
the factual basis for certifying that a rule will not have a 
significant economic impact on a substantial number of small entities.
    The Agency has considered the effects of this proposed rule under 
the Regulatory Flexibility Act and certifies that the amendments will 
not have a significant economic impact upon a substantial number of 
small entities.
    The following is NHTSA's statement providing the factual basis for 
the certification under 5 U.S.C. 605(b). The proposed amendments would 
affect entities that modify nonconforming vehicles and that are small 
businesses within the meaning of the Regulatory Flexibility Act; 
however, the Agency has no reason to believe that these companies will 
be unable to pay the fees adjusted by this action. This notice does not 
propose any new fees and the fee increases proposed herein represent 
overdue increases from the fees previously established by NHTSA. 
Moreover, consistent with prevailing industry practices, these fees are 
likely to be passed through to the ultimate purchasers of the vehicles 
that are altered and, in most instances, sold by the affected 
registered importers. The cost to owners or purchasers of nonconforming 
vehicles that are altered to conform to the FMVSS may be expected to 
increase to the extent necessary to reimburse the registered importer 
for the fees payable to NHTSA for the cost of carrying out the 
registration program and making eligibility decisions, and to 
compensate Customs for its bond processing costs.
    Governmental jurisdictions will not be affected at all since they 
are generally neither importers nor purchasers of nonconforming motor 
vehicles.

C. Executive Order 13132 (Federalism)

    Executive Order 13132 on ``Federalism'' requires NHTSA to develop 
an accountable process to ensure ``meaningful and timely input by State 
and local officials in the development of regulatory policies that have 
Federalism implications.'' Executive Order 13132 defines the term 
``policies that have federalism implications'' to include regulations 
that have ``substantial direct effects on the States, on the 
relationship between the national government and the States, or on the 
distribution of power and responsibilities among the various levels of 
government.'' Under Executive Order 13132, NHTSA may not issue a 
regulation that has federalism implications, that imposes substantial 
direct compliance costs, and that is not required by statute, unless 
the Federal government provides the funds necessary to pay the direct 
compliance costs incurred by State and local governments, or NHTSA 
consults with State and local officials early in the process of 
developing the proposed regulation.
    This proposed rule will not have substantial direct effects on the 
States,

[[Page 56379]]

on the relationship between the national government and the States, or 
on the distribution of power and responsibilities among the various 
levels of government as specified in Executive Order 13132. State and 
local governments will not be affected at all since they do not 
regulate the importation of motor vehicles or import or purchase 
nonconforming vehicles. Thus, the requirements of section 6 of the 
Executive Order do not apply to this proposed rule.

D. National Environmental Policy Act

    NHTSA has analyzed this action for purposes of the National 
Environmental Policy Act. The proposed action will not have a 
significant effect upon the environment because it is not anticipated 
that the annual volume of motor vehicles manufactured, sold, or 
operated will vary significantly from that existing before the 
promulgation of the rule.

E. Executive Order 12988 (Civil Justice Reform)

    Pursuant to Executive Order 12988, ``Civil Justice Reform,'' NHTSA 
has considered whether this proposed rule would have any retroactive 
effect. NHTSA concludes that this rule will not have any retroactive 
effect. Judicial review of a rule may be obtained pursuant to 5 U.S.C. 
702. That section does not require that a petition for reconsideration 
be filed prior to seeking judicial review.

F. Unfunded Mandates Reform Act of 1995

    Section 202 of the Unfunded Mandates Reform Act of 1995 (UMRA), 
Public Law 104-4, requires agencies to prepare a written assessment of 
the costs, benefits, and other effects of proposed or final rules that 
include a Federal mandate likely to result in the expenditure by State, 
local, or tribal governments, in the aggregate, or by the private 
sector, of more than $100 million annually (adjusted for inflation with 
the base year of 1995). Before promulgating a rule for which a written 
assessment is needed, Section 205 of the UMRA generally requires NHTSA 
to identify and consider a reasonable number of regulatory alternatives 
and to adopt the least costly, most cost-effective, or least burdensome 
alternative that achieves the objectives of the rule. The provisions of 
Section 205 do not apply when they are inconsistent with applicable 
law. Moreover, Section 205 allows NHTSA to adopt an alternative other 
than the least costly, most cost-effective, or least burdensome 
alternative if the Agency publishes with the final rule an explanation 
why that alternative was not adopted. Because this proposed rule does 
not require the expenditure of resources beyond $100 million annually, 
this action is not subject to the requirements of Sections 202 and 205 
of the UMRA.

G. Paperwork Reduction Act

    Under the Paperwork Reduction Act of 1995, a person is not required 
to respond to a collection of information by a Federal agency unless 
the collection displays a valid OMB control number. Part 594 is 
associated with a collection of information covered by OMB Clearance 
No. 2127-0002, a consolidated collection of information for 
``Importation of Vehicles and Equipment Subject to the Federal Motor 
Vehicle Safety, Bumper, and Theft Prevention Standards.'' This proposed 
rule does not affect the burden hours associated with Clearance No. 
2127-0002 because the rule only adjusts the fees associated with 
participating in the registered importer program. These new fees will 
not impose a new required collection of information or otherwise affect 
the scope of the program.

H. National Technology Transfer and Advancement Act

    Section 12(d) of the National Technology Transfer and Advancement 
Act of 1995 (NTTAA), Public Law 104-113,15 U.S.C. 272, directs NHTSA to 
use voluntary consensus standards in its regulatory activities unless 
doing so would be inconsistent with applicable law or otherwise 
impractical. Voluntary consensus standards are technical standards 
(e.g., materials specifications, test methods, sampling procedures, and 
business practices) that are developed or adopted by voluntary 
consensus standards bodies, such as the Society of Automotive Engineers 
(SAE). The NTTAA directs the Agency to provide Congress, through the 
OMB, with explanations when we decide not to use available and 
applicable voluntary consensus standards.
    In this proposed rule, we are adjusting the fees associated with 
the registered importer program. This document does not make 
substantive changes to the program nor do we adopt any technical 
standards. For these reasons, Section 12(d) of the NTTAA does not 
apply.

I. Privacy Act

    Anyone can search the electronic form of all comments received into 
any of our dockets by the name of the individual submitting the comment 
(or signing the comment, if submitted on behalf of an association, 
business, labor union, etc.). You may review the Department of 
Transportation's (DOT) complete Privacy Act Statement in the Federal 
Register published on April 11, 2000 (65 FR 19477-78) or you may visit 
http://DocketInfo.dot.gov.

J. Public Participation

1. How do I prepare and submit comments?
    Your comments must be written and in English. To ensure that your 
comments are correctly filed in the Docket, please include the docket 
number of this document in your comments.
    Your comments must not be more than 15 pages long. See 49 CFR 
553.21. We established this limit to encourage you to write your 
primary comments in a concise fashion. However, you may attach 
necessary additional documents to your comments. There is no limit on 
the length of the attachments.
    Please submit two copies of your comments, including the 
attachments, to Docket Management identified at the beginning of this 
document, under ADDRESSES. You may also submit your comments 
electronically to the docket following the steps outlined under 
ADDRESSES.
2. How can I be sure that my comments were received?
    If you wish Docket Management to notify you upon its receipt of 
your comments, enclose a self-addressed, stamped postcard in the 
envelope containing your comments. Upon receiving your comments, Docket 
Management will return the postcard by mail.
3. How do I submit confidential business information?
    If you wish to submit any information under a claim of 
confidentiality, you should submit your complete submission, including 
the information you claim to be confidential business information 
(CBI), to the NHTSA Chief Counsel. When you send a comment containing 
CBI, you should include a cover letter setting forth the information 
specified in our CBI regulation.\3\
---------------------------------------------------------------------------

    \3\ See 49 CFR part 512.
---------------------------------------------------------------------------

    In addition, you should submit a copy from which you have deleted 
the claimed CBI to the Docket by one of the methods set forth above.
    To facilitate social distancing due to COVID-19, NHTSA is treating 
electronic submission as an acceptable method for submitting CBI to the 
Agency under 49 CFR part 512.
    Any CBI submissions sent via email should be sent to an attorney in 
the

[[Page 56380]]

Office of Chief Counsel at the address given above under FOR FURTHER 
INFORMATION CONTACT. Likewise, for CBI submissions via a secure file 
transfer application, an attorney in the Office of Chief Counsel must 
be set to receive a notification when files are submitted and have 
access to retrieve the submitted files. At this time, regulated 
entities should not send a duplicate hardcopy of their electronic CBI 
submissions to DOT headquarters.
    Please note that these modified submission procedures are only to 
facilitate continued operations while maintaining appropriate social 
distancing due to COVID-19. Regular procedures for Part 512 submissions 
will resume upon further notice, when NHTSA and regulated entities 
discontinue operating primarily in telework status.
    If you have any questions about CBI or the procedures for claiming 
CBI, please consult the attorney identified in the FOR FURTHER 
INFORMATION CONTACT section.
4. How can I read the comments submitted by other people?
    You may read the comments received by Docket Management at the 
address and times given near the beginning of this document under 
ADDRESSES.
    You may also see the comments on the internet. To read the comments 
on the internet, go to http://www.regulations.gov and follow the online 
instructions provided.
    You may download the comments. The comments are imaged documents, 
in either TIFF or PDF format. Please note that even after the comment 
closing date, we will continue to file relevant information in the 
Docket as it becomes available. Further, some people may submit late 
comments. Accordingly, we recommend that you periodically search the 
Docket for new material.

K. Plain Language

    E.O. 12866 requires each agency to write all rules in plain 
language. Application of the principles of plain language includes 
consideration of the following questions:
    1. Have we organized the material to suit the public's needs?
    2. Are the requirements in the rule clearly stated?
    3. Does the rule contain technical language or jargon that isn't 
clear?
    4. Would a different format (grouping and order of sections, use of 
headings, paragraphing) make the rule easier to understand?
    5. Would more (but shorter) sections be better?
    6. Could we improve clarity by adding tables, lists, or diagrams?
    7. What else could we do to make the rule easier to understand?
    If you have any responses to these questions, please include them 
in your comments on this proposal.

L. Regulation Identifier Number (RIN)

    The DOT assigns a regulation identifier number (RIN) to each 
regulatory action listed in the Unified Agenda of Federal Regulations. 
The Regulatory Information Service Center publishes the Unified Agenda 
in April and October of each year. You may use the RIN that appears in 
the heading on the first page of this document to find this action in 
the Unified Agenda.

List of Subjects in 49 CFR Part 594

    Administrative practice and procedure, Imports, Motor vehicle 
safety, Motor vehicles.

    For the reasons stated in the preamble, NHTSA proposes to amend 49 
CFR part 594 as follows:

PART 594--SCHEDULE OF FEES AUTHORIZED BY 49 U.S.C. 30141

0
1. The authority citation for part 594 is revised to read as follows:

    Authority:  49 U.S.C. 30141, 31 U.S.C. 9701; delegation of 
authority at 49 CFR 1.95 and 49 CFR 501.8(g).

0
2. Amend Sec.  594.6 by:
0
a. Revising the introductory text of paragraph (a);
0
b. Revising paragraph (b);
0
c. Revising the first sentence of paragraph (d);
0
d. Revising paragraph (g);
0
e. Revising the second sentence of paragraph (h); and
0
f. Revising paragraph (i)


Sec.  594.6   Annual fee for administration of the registration 
program.

    (a) Each person filing an application to be granted the status of a 
Registered Importer pursuant to part 592 of this chapter on or after 
October 1, 2022, must pay a fee of $3,568, as calculated below, based 
upon the direct and indirect costs attributable to: * * *
* * * * *
    (b) That portion of the initial fee attributable to application 
processing for applications filed on and after October 1, 2022, is 
$437. The sum of $437, representing this portion, shall not be 
refundable if the application is denied or withdrawn.
* * * * *
    (d) That portion of the initial annual fee attributable to the 
remaining activities of administering the registration program on and 
after October 1, 2022, is set forth in paragraph (i) of this section. * 
* *
* * * * *
    (g) The direct costs included in establishing the annual fee for 
maintaining registered importer status are the estimated costs of 
professional and clerical staff time, computer and computer operator 
time, and postage, per Registered Importer. The direct costs included 
in establishing the annual fee for a specific Registered Importer 
include costs of transportation, lodging, and per diem allowance at the 
standard CONUS rate as established by the General Services 
Administration (see https://www.gsa.gov/perdiem), attributable to 
inspections conducted with respect to that Registered Importer in 
administering the registration program. If NHTSA makes an inspection of 
the Registered Importer's records or facilities, a supplemental fee 
will be required. NHTSA will notify the applicant in writing after the 
conclusion of any such inspection that a supplement to the annual fee 
in a stated amount is due upon receipt of such notice to recover the 
direct and indirect costs associated with such inspection and 
notification, and that the recipient will be subject to automatic 
revocation or suspension under 49 CFR 592.7(a)(1) if no such 
supplemental fee is received.
    (h) * * * This cost is $42.25 per hour for the period beginning 
October 1, 2022.
    (i) Based upon the elements and indirect costs of paragraphs (f), 
(g), and (h) of this section, the component of the initial annual fee 
attributable to administration of the registration program (excluding 
any charges for inspection costs), covering the period beginning 
October 1, 2022, is $3,131. When added to the costs of registration of 
$437, as set forth in paragraph (b) of this section, the costs per 
applicant to be recovered through the annual fee are $3,568. The annual 
renewal registration fee for the period beginning October 1, 2022, is 
$3,619.
0
3. Amend Sec.  594.7 by revising paragraph (e) to read as follows:


Sec.  594.7   Fee for filing petitions for a determination whether a 
vehicle is eligible for importation.

* * * * *
    (e) For petitions filed on and after October 1, 2022, the fee 
payable for seeking a determination under paragraph (a)(1) of this 
section is $320. The fee payable for a petition seeking a determination 
under paragraph (a)(2) of this section is $1,280. If the petitioner 
requests an inspection of a vehicle, costs of transportation, lodging, 
and per diem

[[Page 56381]]

allowance at the standard CONUS rate as established by the General 
Services Administration (see https://www.gsa.gov/perdiem) attributable 
to the inspection shall be added to such fee. No portion of this fee is 
refundable if the petition is withdrawn or denied.
* * * * *
0
4. Amend Sec.  594.8 by revising the first sentences of paragraphs (b) 
and (c) to read as follows:


Sec.  594.8   Fee for importing a vehicle pursuant to a determination 
by the Administrator.

* * * * *
    (b) If a determination has been made pursuant to a petition, the 
fee for each vehicle is $273. * * *
    (c) If a determination has been made pursuant to the 
Administrator's initiative, the fee for each vehicle is $125. * * *
* * * * *
0
5. Amend Sec.  594.9 by revising paragraphs (c) and (e) to read as 
follows:


Sec.  594.9   Fee for reimbursement of bond processing costs and costs 
for processing offers of cash deposits or obligations of the United 
States in lieu of sureties on bonds.

* * * * *
    (c) The bond processing fee for each vehicle imported on and after 
October 1, 2022, for which a certificate of conformity is furnished is 
$11.20.
* * * * *
    (e) The fee for each vehicle imported on and after October 1, 2022, 
for which cash deposits or obligations of the United States are 
furnished in lieu of a conformance bond is $499.
0
6. Amend Sec.  594.10 by revising paragraph (d) to read as follows:


Sec.  594.10   Fee for review and processing of conformity certificate.

* * * * *
    (d) The review and processing fee for each certificate of 
conformity submitted on and after October 1, 2022, is $21. However, if 
the vehicle covered by the certificate has been entered electronically 
with the U.S. Department of Homeland Security through the Automated 
Broker Interface and the registered importer submitting the certificate 
has an email address, the fee for the certificate is $14, provided that 
the fee is paid by a credit card issued to the registered importer. If 
NHTSA finds that the information in the entry or the certificate is 
incorrect, requiring further processing, the processing fee shall be 
$58 for every instance in which the foregoing materials are submitted 
incorrectly.

    Issued in Washington, DC, under authority delegated in 49 CFR 
1.95, 501.5 and 501.8.
Milton E. Cooper,
Director, Rulemaking Operations.
[FR Doc. 2022-19560 Filed 9-13-22; 8:45 am]
BILLING CODE 4910-59-P