[Federal Register Volume 87, Number 190 (Monday, October 3, 2022)]
[Proposed Rules]
[Pages 59731-59740]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-21030]


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

  Federal Register / Vol. 87, No. 190 / Monday, October 3, 2022 / 
Proposed Rules  

[[Page 59731]]



DEPARTMENT OF AGRICULTURE

Animal and Plant Health Inspection Service

9 CFR Part 130

[Docket No. APHIS-2021-0052]
RIN 0579-AE67


Process for Establishing Rates for Veterinary Services User Fees

AGENCY: Animal and Plant Health Inspection Service, USDA.

ACTION: Proposed rule.

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

SUMMARY: We are proposing to amend the regulations concerning user fees 
that we charge for veterinary diagnostic services and for certain 
import-related and export-related services for live animals, animal 
products and byproducts, birds, germplasm, organisms, and vectors. We 
are proposing to remove the tables providing the individual fees from 
the regulations and post them on an Animal and Plant Health Inspection 
Service (APHIS) website instead. The regulations would instead specify 
the methodology (formula) used to calculate the fees (including imputed 
costs), and APHIS would update the fees using a notice-based process. 
Replacing the current user fee listings with a standardized methodology 
would increase transparency in the process of setting fee rates, align 
the regulations with other Departmental practices, and allow us to 
streamline processes and reduce the number of rules needed in order to 
update the fees.

DATES: We will consider all comments that we receive on or before 
December 2, 2022.

ADDRESSES: You may submit comments by either of the following methods:
     Federal eRulemaking Portal: Go to www.regulations.gov. 
Enter APHIS-2021-0052 in the Search field. Select the Documents tab, 
then select the Comment button in the list of documents.
     Postal Mail/Commercial Delivery: Send your comment to 
Docket No. APHIS-2021-0052, Regulatory Analysis and Development, PPD, 
APHIS, Station 3A-03.8, 4700 River Road, Unit 118, Riverdale, MD 20737-
1238.
    Supporting documents and any comments we receive on this docket may 
be viewed at www.regulations.gov or in our reading room, which is 
located in room 1620 of the USDA South Building, 14th Street and 
Independence Avenue SW, Washington, DC. Normal reading room hours are 8 
a.m. to 4:30 p.m., Monday through Friday, except holidays. To be sure 
someone is there to help you, please call (202) 799-7039 before coming.

FOR FURTHER INFORMATION CONTACT: Ms. Lisa Slimmer, User Fee Financial 
Team Manager, Veterinary Services Money Management, 920 Main Campus 
Drive, Raleigh, NC 27606; (919) 855-7253.

SUPPLEMENTARY INFORMATION: 

Background

    The regulations covering user fees to reimburse the U.S. Department 
of Agriculture's (USDA's) Animal and Plant Health Inspection Service 
(APHIS) for the costs of providing veterinary diagnostic services and 
import/export related services for live animals, animal products and 
byproducts, birds, germplasm, organisms, and vectors are contained in 9 
CFR part 130 (referred to below as the regulations or the user fee 
regulations). These user fees are authorized by section 2509(c) of the 
Food, Agriculture, Conservation, and Trade Act of 1990, as amended (21 
U.S.C. 136a(c)), which provides that the Secretary of Agriculture may, 
among other things, prescribe regulations and collect fees to recover 
the costs of providing import/export related services for animals, 
animal products and byproducts, birds, germplasm, organisms, and 
vectors, and for veterinary diagnostics relating to the control and 
eradication of communicable diseases of livestock or poultry within the 
United States.
    Since fiscal year (FY) 1992, APHIS has received no directly 
appropriated funds to cover the cost of certain veterinary diagnostics 
or to provide import/export related services for animals, animal 
products and byproducts, birds, germplasm, organisms, and vectors. Our 
ability to provide these services depends on user fees. User fees 
associated with providing services for live animal, animal product, 
bird, and germplasm imports and exports fund, among other things, 
quarantine services, the processing of import permit applications, port 
of entry inspections, inspections and approvals of import/export 
facilities and establishments, endorsements of export certificates, and 
services related to emergency situations that arise during the export 
or import process.
    The work of veterinary diagnostics is performed in a laboratory to 
determine if a disease-causing organism or chemical agent is present in 
body tissues or cells and, if so, to identify those organisms or 
agents. Services in this category include, among other things, 
performing laboratory (identification, serology, and pathobiology) 
tests and providing diagnostic reagents and other veterinary diagnostic 
materials and services. The National Veterinary Services Laboratories 
provide diagnostic goods and services.
    User fees recover the cost of operating a public system by charging 
those members of the public who use the system, rather than the public 
as a whole, for its operation. Financing certain veterinary diagnostic 
and import/export related services and products by directly charging 
the users of those services internalizes those costs to those who 
require the service and benefit from it.
    In the past, APHIS' rulemaking established user fee rates for 5-
year periods of time. Individual fees would typically adjust annually 
and were specific to given fiscal years. The rulemaking process is 
lengthy and so, to establish 5 years of fees at one time, APHIS 
Veterinary Services (VS) had to forecast customer needs and Agency 
costs 6 to 7 years into the future. Even though VS based its cost 
estimates on the best data available, such forecasting has proven 
difficult, and we have found these long-range estimates unreliable for 
setting fees to recover the costs of providing desired goods and 
services without over- or undercharging our customers. For example, the 
user fee rates established in 2011 and 2012 used the best available 
data during 2009 for those years and did not anticipate the high level 
of investment in information technology that would be needed to

[[Page 59732]]

meet customer demand to conduct business with VS in the coming decade.
    In order to provide both transparency and predictability to the 
industries served and to allow VS to effectively plan for staffing, 
investments in infrastructure, and other resources, we are proposing to 
remove specific user fees from the regulations and establish a 
standardized methodology by which VS will calculate fees annually. VS 
would post the fee rates on www.aphis.usda.gov/business-services/vs-vd-fees. (Please note that this site does not yet exist; it would be 
developed should this rule be finalized.) The components (costs) APHIS 
would use to calculate the fee rates would be the same components 
currently used to calculate rates, with the addition of imputed costs. 
These imputed costs include U.S. Department of Labor, U.S. Office of 
Personnel Management, and the U.S. Department of State (State 
Department) costs to provide retirement, health, life insurance, 
worker's compensation, legal defense, and other benefits to the Agency 
and employees who provide the services covered by the fees. In 
accordance with the Office of Management and Budget (OMB) Circular A-
25, User Charges, APHIS must compensate the Treasury General fund for 
these costs, so they are not borne by the taxpayer. Accordingly, to 
comply with OMB Circular A-25, we must include imputed costs in our 
calculations.
    Under the proposed approach, APHIS would update its fees each 
calendar year. Each year, prior to the beginning of the following 
calendar year, APHIS would propose actual fee rates through publication 
of a notice in the Federal Register. The annual notice would provide 
information regarding the basis for any fee change, including cost of 
living, information technology investment, facilities capital 
requirements, and inflation rates. We would also describe any cost-
saving measures the agency is undertaking. The notices would take 
public comment. Following the comment period, we would issue a 
subsequent (final) notice providing the final rates. This notice would 
respond to any comments received on the initial notice. When the final 
notice is issued, APHIS would update the fee rates found at 
www.aphis.usda.gov/business-services/vs-vd-fees.
    This approach would reduce the number of regulations published for 
user fee rate setting. It would, also, shorten the time required to 
update user fees for these services and products, provide greater 
transparency to our customers concerning the way in which we derive our 
user fees, avoid financial crises that may occur when APHIS does not 
collect sufficient funds, reduce the potential of APHIS collecting 
funds over the amounts needed to cover costs, and ensure user fees 
cover the full APHIS cost to provide a given service (as intended by 
these types of fees).
    At this time, we are not proposing to adjust the fee rates through 
this rulemaking. However, we anticipate that, since APHIS' import/
export and veterinary diagnostics user fees have not been updated for 
more than 10 years, there will be a change in the fees when APHIS 
applies this new approach and issues our first notice in the Federal 
Register under the approach. These changes would be the result of using 
current economic data, staff processing time, increased complexity of 
work, and cost estimates to calculate the fees; current import/export 
and veterinary diagnostics fees are based on data from FY 2012 and FY 
2011, respectively.
    Finally, it should be noted that the proposed change in the method 
by which we update our user fees and the removal of user fee tables 
from the regulations in favor of maintaining a listing of specific user 
fee rates online at www.aphis.usda.gov/business-services/vs-vd-fees 
would not affect the table of overtime rates currently found in Sec.  
130.50(b)(3)(i) charged in addition to certain flat rate user fees. The 
user fees listed in that paragraph merely reproduce those found in 9 
CFR 97.1(a) to improve ease of use for regulated entities and 
individuals. These rates impact other entities within APHIS and are 
adjusted periodically through separate rulemaking.

Development of Formulas

    The components (costs) we would use to calculate user fee rates are 
the same costs used in calculating past rates with the exception of 
imputed costs, which are discussed in detail below:

            Comparison of Current Versus Proposed Components
                                 [Costs]
------------------------------------------------------------------------
           Current charges                      Proposed charges
------------------------------------------------------------------------
Direct labor.........................  Direct pay (on-board and in the
                                        hiring process, and including
                                        benefits), Cost of living.
Local support........................  Direct operating costs (travel,
                                        training, equipment, rent,
                                        facility maintenance, supplies
                                        and materials, service
                                        contracts, information
                                        technology system operations,
                                        maintenance, and development),
                                        Consumer price index.
Program and Agency support...........  Department, Agency, and Program
                                        support.
Departmental charges.................  Department support.
Reserve..............................  Imputed costs (new)
                                       Reserve.
------------------------------------------------------------------------

    We calculate our user fees to cover the full cost of providing the 
services for which we charge the fee. The cost of providing a service 
includes these components, which are described in more detail below. In 
addition, in proposed Sec.  130.1, we are adding the following terms 
and their definitions in order to provide additional clarity: Consumer 
price index, cost of living, direct operating costs, direct pay 
(including benefits), imputed costs, reserve, program, agency, and 
department support.
    We are proposing to add consumer price index (CPI) to read as the 
measure of the average change over time in prices paid by urban 
consumers for a market basket of consumer goods and services. This 
would be determined by the Bureau of Labor Statistics (BLS), and APHIS 
would use BLS' annual average for the CPI.\1\
---------------------------------------------------------------------------

    \1\ The CPI is not calculated by the program, it can be found 
using the following link: https://www.bls.gov/cpi/news.htm.
---------------------------------------------------------------------------

    We are proposing to add cost of living to read as the adjusted 
annual rate used to determine the cost of maintaining a certain 
standard of living based on the economic assumptions in OMB's 
Presidential Economic Assumptions (PEA). The PEA outlines the economic 
assumptions undergirding the

[[Page 59733]]

President's budget for a particular fiscal year, and includes several 
projections related to cost of living, including anticipated inflation 
rates and consumer price indices.
    We are proposing to add direct operating costs to the definitions. 
The term would include: Travel and transportation for personnel; 
materials, supplies and other necessary items; training; general office 
supplies; rent; facility maintenance; equipment purchase and 
maintenance; utilities; contractual services; and information 
technology systems operations, maintenance, and development costs. 
Materials and supplies include items like animal food and bedding, 
chemicals, and medicine as well as materials needed to conduct 
laboratory tests.
    Within direct operating costs, rent and facility maintenance are 
the costs of using the space we need to perform veterinary diagnostic 
services or import- or export-related work. If space is used for 
veterinary diagnostic services or import- or export-related work and 
other Agency work, only that portion of the costs associated with the 
veterinary diagnostic services or import- or export-related work is 
included in the user fees. Equipment purchases and maintenance costs 
include repair and replacement of existing equipment, in addition to 
purchase of new equipment, and are necessitated when issues arise. 
Maintenance may also be determined by recurring maintenance schedules 
for existing equipment. Utilities include water, telephone, 
electricity, and heating costs. Contractual services include security 
service, maintenance, trash pickup, and similar services. Finally, a 
number of information technology systems support APHIS' import/export 
and veterinary diagnostics services. There are annual costs with 
operating and maintaining those systems as well as development costs to 
enhance and add new features that support import/export and veterinary 
diagnostic services. The type, amount, and cost of direct operating 
costs vary with the type of good or service provided.
    We are proposing to add direct pay (including benefits) to read as 
the wage labor costs (on board and in the hiring process), including 
benefits, for employees who specifically support and provide the 
required service. For example, at APHIS' Animal Import Centers, animal 
caretakers and veterinarians prepare for the arrival of animals or 
birds to be quarantined in the center, care for them (provide feed and 
water, clean cages or stalls) while they are quarantined, observe them 
while they are quarantined, release them from quarantine, and clean the 
quarantine area afterwards. If the service is inspecting an animal, the 
direct pay costs include the time spent by the inspector to conduct the 
inspection. Direct pay also includes the wage labor costs, including 
benefits, of employees providing direct administrative support in the 
field for these activities such as those who assist with the review of 
export documents and those who complete and process billing paperwork. 
The costs vary with the type of service provided and with the pay rate 
of the employee who performs the service and support.
    We are adding a definition for imputed costs that would read Office 
of Workers' Compensation costs from the Department of Labor; costs of 
employee leave earned in a prior fiscal year and used in the current 
fiscal year; Office of Personnel Management and State Department costs 
to provide retirement, health, and life insurance benefits to 
employees; unemployment compensation costs; and Department of Justice 
judgment fund costs.
    APHIS will forward to the Department of Treasury (U.S. Treasury) 
fee revenue collected based on imputed costs of other Agencies. APHIS 
will not retain that revenue. These costs were previously paid at the 
Agency level but must now be included in user fee calculation in 
accordance with OMB Circular, A-25 ``User Charges,'' and Federal 
Accounting Standards Advisory Board (FASAB) Statement of Federal 
Financial Accounting Standards, Number 55, ``Amending Inter-entity Cost 
Provisions.''
    We are adding a definition of Program, Agency, and Department 
support to read indirect or direct costs of the program, including 
supporting services provided to the industry. Agency and Department 
support costs are calculated as a pro-rata share of total direct labor 
and direct operating costs and are added to each fee. Agency and 
Department support costs include the costs of providing budget and 
accounting services, information technology services, regulatory 
services, investigative and enforcement services, debt-management 
services, personnel services, public information services, legal 
services, working with Congress, and other general program and agency 
management services provided above the local level.
    We are adding a definition for reserve to read funds above expected 
obligations that are required to effectively manage uncertainties in 
demand and timing to ensure sufficient operating funds in cases of bad 
debt, customer insolvency, fluctuations in activity volumes, 
information technology development costs, cash flow, facilities capital 
needs, or fluctuations in activity volumes caused by unforeseen global 
and national events.
    All user fees would contribute to the reserve proportionately. The 
more a program depends on fees to fund its activities, the more 
vulnerable it is to revenue instability. Fully funded fee programs do 
not necessarily see a proportional decline in costs when there is a 
drop in collections. The reserve would ensure that we have sufficient 
operating funds in cases of bad debt, customer insolvency, information 
technology development costs, cash flow, facilities capital needs, or 
fluctuations caused by unforeseen global and national events.
    The reserve component would be estimated as follows: At the time 
annually when we would calculate our proposed user fee rates, we would 
estimate cash flow needs, as we currently do, by estimating 25 percent 
or 90 days of annual expenditures, whichever is greater. We would then 
forecast information technology and facilities capital needs and 
investments, including any major purchases or improvement of equipment 
or systems, for the next 5 fiscal years, and assign an estimated date 
at which we anticipate these costs to be actualized. Based on the 
expected date of cost actualization within that 5-year forecast, we 
would add a prorated component of that cost to the above cash flow 
needs. Finally, this sum would be offset by the existing amount in the 
reserve, and the difference calculated into each user fee.
    Reserve levels would be set at a level meant to reflect the 
forecasted needs, as articulated above, but would be monitored and 
adjusted annually as needs or costs change. We intend to closely 
monitor the operations and operating environment including demand, 
costs changes, administrative policies, investment needs and the 
economic environment closely and propose adjustments, as needed, in our 
fees annually to ensure an adequate reserve balance.
    We are also proposing to remove a number of definitions from the 
regulations because, based on the revisions we are proposing, the terms 
themselves would no longer appear in part 130. Specifically, we are 
proposing to remove: Approved establishment, biosecurity level three 
laboratory, breeding animal, domestic animal, game cock, grade animal, 
load, miniature horse, nonstandard care and handling, nonstandard 
housing,

[[Page 59734]]

registered animal, slaughter animal, State animal health official, zoo 
animal, zoo bird, zoo equine. To the extent that the terms would still 
be used on tables that would now appear on APHIS' website, the terms 
would be annotated accordingly on the website to explain what they 
mean, instead.

Proposed Formulas for User Fees

    VS user fees are collected for activities and products that fall 
into four broad categories: Supervision and inspection services; 
housing; export health certificates; and veterinary diagnostic services 
and reagents. As stated previously, the regulations would specify the 
methodology used to calculate and implement the fees charged by VS 
user-funded programs. APHIS would publish the fee rates on its website, 
and it will publish a notice on an annual basis in the Federal Register 
to propose changes to the user fee rates.
    Direct pay, direct operating costs, and most costs used in the 
formulas would be based on the prior fiscal year's (or applicable 
accounting period or historical data) actual costs and hours. 
Currently, some fees are charged on a per unit basis and others are 
charged on a per hour basis. To maintain consistency, APHIS would 
continue to provide fees based on a per hour and per unit basis as 
currently specified.
    The steps we would use to generate new fees are:
    1. APHIS would prorate the total inspection, certification, or 
laboratory service program personnel direct pay (adjusted for vacancies 
and including benefits) for the previous fiscal year to each fee based 
upon the direct time factor percentage of employee's time to perform 
and complete each fee code process and then multiply by the next year's 
percentage of cost of living increase.
    2. APHIS would prorate total direct operating costs for the 
previous fiscal year based upon the direct time factor percentage of 
employee's time to perform and complete each fee code process to each 
fee and then multiply by the anticipated percentage of inflation for 
the next year.
    3. APHIS would add estimates for Program, Agency, and Department 
support costs, imputed costs, and reserve by applying a percentage 
based on information from Program, Agency, and Department officials and 
the U.S. Treasury to the sum of the direct pay plus operating costs.
    4. Steps 1-3 would be added and then we would create the new base 
fee rate by rounding up to the next $0.25 for all fees less than $10 or 
round up or down to the nearest dollar for all fees greater than $10.
    Fees calculated using this approach would cover inflation and 
national and locality pay raises but would not support any new 
budgetary initiative. In the event of any such budgetary changes, such 
as the OMB Circular's, A-25 ``User Charges'' (requiring inclusion of 
imputed costs into user fee calculations), we would include an 
explanation of the new cost component and the method by which it is 
determined in the annual notice.
    The foregoing would be the general formula that we would use in 
order to calculate the fees. However, we do recognize that there are 
some fees for which the formula would not be germane.
    For any category of fees, if there is no identifiable volume in the 
previous year for the service provided by the fee, if the fee is rarely 
charged, or if we cannot readily identify level of effort, we would 
calculate the fee based on the last available historic data that 
encompasses multiple instances of use and add any intervening 
inflation, program and support costs, imputed costs, and reserve.
    Fees for the exclusive use of space in animal import centers 
currently found in Sec.  130.3 are unique and would be calculated 
somewhat differently. APHIS would calculate the fees using direct 
employees average time (with benefits), and then adding a prorated 
portion of currently identifiable expenses (facilities, rent, support 
cost, and admin support costs), program and support expenses, imputed 
costs, and reserve. These costs are combined to determine the monthly 
cost of providing the service within the animal import center. The 
costs of different spaces within the Animal Import Center are 
calculated based on the square footage of the location.

Miscellaneous Change

    Removal of the specific tables of user fees from the regulations in 
favor of listing them online at www.aphis.usda.gov/business-services/vs-vd-fees necessitates reorganization of the text currently found in 
Sec. Sec.  130.2 through 130.51. In some cases, the only text in a 
given section is a reference to the table and would therefore need to 
be removed. In other cases, extra stipulations and clarifying 
information would be retained but reorganized in light of the 
streamlined regulations; however, the information presented remains the 
same.

Executive Order 12866 and Regulatory Flexibility Act

    This proposed rule has been determined to be not significant for 
the purposes of Executive Order 12866 and, therefore, has not been 
reviewed by the Office of Management and Budget.
    In accordance with the Regulatory Flexibility Act, we have analyzed 
the potential economic effects of this action on small entities. The 
analysis is summarized below. Copies of the full analysis are available 
by contacting the person listed under FOR FURTHER INFORMATION CONTACT 
or on the Regulations.gov website (see ADDRESSES above for instructions 
for accessing Regulations.gov).
    APHIS Veterinary Services (VS) is proposing to amend the 
regulations in 9 CFR part 130 to provide for a set of standardized 
formulas by which import/export and veterinary diagnostic user fees 
would be calculated. The proposed regulations would specify the 
methodology used to calculate and implement the user fees and would 
remove tables showing specific fees. VS would instead post the fee 
rates on its website and annually issue a notice providing all fees 
calculated for the upcoming year using formulas contained in the 
regulations and request public comment.
    VS charges user fees to recover the costs of inspection and 
certification services for imports and exports of live animals and 
animal products and byproducts and for providing veterinary diagnostic 
goods and services. VS does not receive appropriated funding to support 
these activities.
    While we do not expect the proposed rule to result in cost savings 
for affected entities, the proposed methodology would provide a 
transparent, streamlined approach to user fee calculations. The change 
to annual fee revisions using formula-based calculations based on 
previous year costs would enable APHIS to avert potential funding 
shortfalls. Increased confidence that rate adjustments would closely 
match revenue requirements would benefit financial planning by both the 
private sector and the Agency.
    The component costs that VS would use to calculate user fee 
revisions would be the same as at present, with the exception of 
imputed labor costs, such as:

 Direct pay (including benefits)
 Cost of living
 Direct operating costs (travel, training, equipment, rent, 
facility maintenance, supplies and materials, service contracts)
 Consumer price index

[[Page 59735]]

 Program, Agency, and Department support costs
 Reserve
 Imputed costs

    The user fee rates would also include imputed labor costs to ensure 
that the full cost of providing user fee services is captured. Imputed 
labor costs include Department of Labor, Office of Personnel 
Management, and State Department costs to provide retirement, health, 
life insurance and other benefits to employees.
    The annual regularity of the proposed VS user fee revisions would 
be in contrast to current circumstances. At present, VS establishes 
fees for 5 years at a time through rulemaking, and this process can be 
lengthy. VS has had to project costs 6 to 7 years into the future, 
which can result in unforeseen funding needs not being accounted for. 
For example, VS did not anticipate the high level of technological 
investment that has been necessary in order to meet the needs of 
customers.
    APHIS' animal health import and export user fees cover significant 
activities across the country, including at border locations and 
quarantine facilities. These fees support personnel, brick and mortar 
facilities, and information technology systems. The veterinary 
diagnostic user fees support activity at the National Veterinary 
Services Laboratories facilities in Ames, IA, and Plum Island, NY.
    The last rate increase went into effect October 2012 and import/
export user fee revenue has been flat, on average, since 2015, at $44 
million. Veterinary diagnostic user fee revenue has also been flat at 
$6 million, on average, since the last veterinary diagnostic user fee 
rate increase went into effect October 2011. The cost of providing 
services has continued to increase.
    USDA's Agricultural and Marketing Service and Food Safety and 
Inspection Service have recently implemented noticed-based processes 
for annual user fee revisions that are very similar to the APHIS 
proposed process. The two agencies and their stakeholders have 
benefited from increased program efficiency and transparency.
    A large number of the entities that would benefit from this rule 
are small. The import/export user fees provide for inspection and other 
services at the ports or point of entry. Users of these services and 
products include importers, exporters, non-APHIS veterinarians, 
commercial laboratories and pharmaceutical manufacturers, State 
laboratories, universities, and foreign governments.
    The Small Business Administration (SBA) \2\ has established 
guidelines for determining which entities are to be considered small. 
Importers and exporters of live animals are identified within the 
broader wholesaling trade sector of the U.S. economy. A firm primarily 
engaged in wholesaling animals or animal products and byproducts is 
considered small if it employs not more than 100 persons. These 
entities either sell goods on their own account (import/export 
merchants) or arrange for the sale of goods owned by others (import/
export agents and brokers).
---------------------------------------------------------------------------

    \2\ Data Sources: Economic Census, Small Business 
Administration, APHIS Veterinary Service.
---------------------------------------------------------------------------

    Veterinary testing laboratories are identified within the broader 
veterinary services trade sector. A firm providing veterinary services 
is considered small if it generates $6.5 million or less in annual 
sales. The criterion for a small pharmaceutical manufacturing firm is 
one with 750 or fewer employees.
    The number of entities that use VS diagnostic services and 
materials and qualify as small by SBA standards has not yet been 
determined. However, more than 91 percent of the firms in the NAICS 
Livestock Wholesale category and Other Farm Product Raw Material 
Wholesale category can be considered small. In addition, more than 99 
percent of veterinary services firms (including veterinary diagnostic 
testing laboratories) are small.
    Under these circumstances, the Administrator of the Animal and 
Plant Health Inspection Service has determined that this action will 
not have a significant economic impact on a substantial number of small 
entities.

Executive Order 12372

    This program/activity is listed in the Catalog of Federal Domestic 
Assistance under No. 10.025 and is subject to Executive Order 12372, 
which requires intergovernmental consultation with State and local 
officials. (See 2 CFR chapter IV.)

Executive Order 12988

    This proposed rule has been reviewed under Executive Order 12988, 
Civil Justice Reform. If this proposed rule is adopted: (1) All State 
and local laws and regulations that are inconsistent with this rule 
will be preempted; (2) no retroactive effect will be given to this 
rule; and (3) administrative proceedings will not be required before 
parties may file suit in court challenging this rule.

Paperwork Reduction Act

    This proposed rule contains no new information collection or 
recordkeeping requirements under the Paperwork Reduction Act of 1995 
(44 U.S.C. 3501 et seq.).

List of Subjects in 9 CFR Part 130

    Animals, Birds, Diagnostic reagents, Exports, Imports, Poultry and 
poultry products, Quarantine, Reporting and recordkeeping requirements, 
Tests.

    Accordingly, we propose to revise 9 CFR part 130 to read as 
follows:

PART 130--USER FEES

Sec.
130.1 Definitions.
130.2 Basis for fees and rates.
130.3 Operating details.
130.4 Hourly rate and minimum user fees.
130.5 Exemptions.
130.6 Payment of user fees.
130.7 Penalties for nonpayment or late payment.

    Authority: 5 U.S.C. 5542; 7 U.S.C. 1622 and 8301-8317; 21 U.S.C. 
136 and 136a; 31 U.S.C. 3701, 3716, 3717, 3719, and 3720A; 7 CFR 
2.22, 2.80, and 371.4.


Sec.  130.1  Definitions.

    As used in this part, the following terms shall have the meaning 
set forth in this section.
    Administrator. The Administrator of the Animal and Plant Health 
Inspection Service, or any person authorized to act for the 
Administrator.
    Animal. All animals except birds, but including poultry.
    Animal and Plant Health Inspection Service (APHIS). The Animal and 
Plant Health Inspection Service of the United States Department of 
Agriculture.
    Animal Import Center. Quarantine facilities operated by APHIS in 
Newburgh, New York, and Miami, Florida.
    APHIS representative. An individual, including, but not limited to, 
an animal health technician or veterinarian, authorized by the 
Administrator to perform the services for which the user fees in this 
part are charged.
    Bird. Any member of the class aves, other than poultry.
    Consumer price index. The measure of the average change over time 
in prices paid by urban consumers for a market basket of consumer goods 
and services, as determined by the Bureau of Labor Statistics annually.
    Cost of living. The adjusted annual rate used to determine the cost 
of maintaining a certain standard of living based on the economic 
assumptions in the Office of Management and Budget's Presidential 
Economic Assumptions.
    Diagnostic reagent. Substances used in diagnostic tests to detect 
disease

[[Page 59736]]

agents or antibodies by causing an identifiable reaction.
    Direct operating costs. Costs attributed to travel and 
transportation for personnel; materials, supplies, and other necessary 
items; training; general office supplies; rent; facility maintenance; 
equipment purchase and maintenance; utilities; contractual services; 
and information system operations, maintenance, and development.
    Direct pay (including benefits). The wage labor costs (on board and 
in the hiring process), including benefits, for employees who 
specifically support and provide the required service.
    Equine. Any horse, ass, mule, or zebra.
    Export health certificate. An official document that, as required 
by the importing country, is endorsed by an APHIS representative and 
states that animals, animal products, organisms, vectors, or birds to 
be exported from the United States were found to be healthy and free 
from evidence of communicable diseases and pests.
    Feeder animal. Any animal imported into the United States under 
part 93 of this chapter for feeding.
    Germplasm. Semen, embryos, or ova.
    Import compliance assistance. Services provided to an importer 
whose shipment arrives at a port of entry without the necessary 
paperwork or with incomplete paperwork and who requires assistance to 
meet the requirements for entry into the United States. Fees for import 
compliance assistance are charged in addition to the flat rate user 
fees.
    Imputed costs. Office of Workers' Compensation costs from the 
Department of Labor; costs of employee leave earned in a prior fiscal 
year and used in the current fiscal year; Office of Personnel 
Management and Department of State (State Department) costs to provide 
retirement, health, and life insurance benefits to employees; 
unemployment compensation costs; and Department of Justice judgment 
fund costs.
    In-bond animal. Any animal imported into the United States under a 
United States Customs Service bond, as described in 19 CFR part 113.
    National Veterinary Services Laboratories (NVSL). The National 
Veterinary Services Laboratories of the Animal and Plant Health 
Inspection Service, located in Ames, Iowa.
    National Veterinary Services Laboratories, Foreign Animal Disease 
Diagnostic Laboratory (FADDL). The National Veterinary Services 
Laboratories, Foreign Animal Disease Diagnostic Laboratory, located in 
Greenport, New York.
    Person. An individual, corporation, partnership, trust, 
association, or any other public or private entity, or any officer, 
employee, or agent thereof.
    Pet birds. Birds, except hatching eggs and ratites, that are 
imported or exported for the personal pleasure of their individual 
owners and are not intended for resale.
    Poultry. Chickens, doves, ducks, geese, grouse, guinea fowl, 
partridges, pea fowl, pheasants, pigeons, quail, swans, and turkeys.
    Privately operated permanent import-quarantine facility. Any 
permanent facility approved under part 93 of this chapter to quarantine 
animals or birds, except facilities operated by APHIS.
    Program, Agency, and Department support. Indirect or direct costs 
of the program, including supporting services provided to the industry.
    Reserve. Funds above expected obligations that are required to 
effectively manage uncertainties in demand and timing to ensure 
sufficient operating funds in cases of bad debt, customer insolvency, 
fluctuations in activity volumes, information technology development 
costs, cash flow, facilities capital needs, or fluctuations in activity 
volumes caused by unforeseen global and national events.
    Standard feed. Seed, or dry feeds such as dog food or monkey 
biscuits, whether soaked in water or not.
    Test. A single analysis performed on a single specimen from an 
animal, animal product, commercial product, or animal feed.
    United States. The several States of the United States, the 
District of Columbia, Guam, the Commonwealth of the Northern Mariana 
Islands, the Commonwealth of Puerto Rico, the Virgin Islands of the 
United States, and all other territories and possessions of the United 
States.


Sec.  130.2  Basis for fees and rates.

    (a) Except as set forth in paragraphs (b) through (d) of this 
section, for setting fee rates for each calendar year based upon the 
previous fiscal year, APHIS will calculate the rates for services as 
follows:
    (1) APHIS will prorate the total inspection, certification, or 
laboratory service program personnel direct pay (on board and in hiring 
process including benefits) for the previous fiscal year to each fee 
based upon the direct time factor percentage of employee's average time 
to perform and complete each fee code process and then multiply by the 
next year's percentage of cost of living increase.
    (2) APHIS will prorate total direct operating costs for the 
previous fiscal year based upon the direct time factor percentage of 
employee's average time to perform and complete each fee code process 
to each fee and then multiply by the anticipated percentage of 
inflation for the next year.
    (3) APHIS will add estimates for Program, Agency, and Department 
support costs, imputed costs, and reserve by applying a percentage 
based on information from Program, Agency, and Department officials and 
the Department of Treasury to the sum of the direct pay plus direct 
operating costs.
    (4) The amounts derived via the process described in paragraphs (a) 
through (c) of this section will be added and then APHIS will round up 
to the next $0.25 for all fees less than $10 or round up or down to the 
nearest dollar for all fees greater than $10 to develop the new rate 
for each code.
    (b) If there is no identifiable volume in the previous year for the 
service provided by the fee, if the fee is rarely charged, or if APHIS 
cannot readily identify level of effort, APHIS will calculate the fee 
based on the last available historic data encompassing multiple 
instances of use and add any intervening inflation, overhead and 
support costs, imputed costs, and reserve.
    (c) Fees for the exclusive use of space in animal import centers 
will be calculated using the following formula:
    (1) APHIS will calculate fees by using direct employee average time 
(with benefits) and adding a prorated portion of currently identifiable 
expenses (facilities, rent, support cost, and admin support costs), 
program and support expenses, imputed costs, and reserve.
    (2) APHIS will combine the costs to determine the monthly cost of 
providing the service at a single location within the animal import 
center.
    (3) APHIS will calculate the costs of the other locations within 
the animal import center based on the square footage of the location.
    (d) Services listed in Sec.  130.4 will be charged an hourly rate-
based user fee in accordance with the provisions of that section.


Sec.  130.3  Operating details.

    (a) General standards. (1) User fee rates may be found online at 
www.aphis.usda.gov/business-services/vs-vd-fees or by contacting 
[email protected]. Changes in rates will be proposed annually in the 
following manner:

[[Page 59737]]

    (i) APHIS will propose changes to the fee rates found at 
www.aphis.usda.gov/business-services/vs-vd-fees through publication of 
a notice in the Federal Register. The notice will provide information 
regarding the basis for any fee change and will take public comment.
    (ii) Following the comment period, APHIS will issue a subsequent 
notice in the Federal Registerproviding the final rates. The notice 
will respond to comments received on the initial notice.
    (iii) When this subsequent notice is issued, APHIS will update the 
fee rates found at www.aphis.usda.gov/business-services/vs-vd-fees 
accordingly.
    (2) The person for whom the service is provided and the person 
requesting the service are jointly and severally liable for payment of 
user fees in accordance with this section.
    (b) User fees for individual animals and certain birds quarantined 
in the APHIS-owned or--operated quarantine facilities, including APHIS 
Animal Import Centers. (1) Each user fee is assessed per animal or bird 
quarantined by APHIS. Special requirements may be requested by the 
importer or required by an APHIS representative. Certain conditions or 
traits, such as pregnancy or aggression, may necessitate special 
requirements for certain birds or poultry.
    (2) For any animal or bird that requires a diet other than standard 
feed, including but not limited to diets of fruit, insects, nectar, or 
fish, the importer must either provide feed or pay for it on an actual 
cost basis, including the cost of delivery to the APHIS owned or 
operated Animal Import Center or quarantine facility.
    (c) User fees for exclusive use of space at APHIS Animal Import 
Centers. (1) An importer may request to exclusively occupy a space at 
an APHIS Animal Import Center. Any importer who occupies space for more 
than 30 days must pay 1/30th of the 30-day fee for each additional day 
or part of a day.
    (2) Unless the importer cancels the reservation for exclusive use 
of space in time to receive a refund of the reservation fee in 
accordance with Sec. Sec.  93.103, 93.204, 93.304, 93.404, or 93.504 of 
this chapter, as appropriate, the 30-day user fee will be effective as 
of the first day for which the importer has reserved the space, 
regardless of whether the user occupies the space on that date or not.
    (3) Users must provide APHIS personnel at the Animal Import Center, 
at the time they make a reservation for quarantine space, with the 
following information:
    (i) Species of animals and birds to be quarantined;
    (ii) Ages of animals and birds to be quarantined; and
    (iii) Sizes of animals and birds to be quarantined.
    (4)(i) APHIS personnel at the Animal Importer Center will 
determine, based on the information provided by the importer under 
paragraph (b)(3) of this section, and on routine husbandry needs, the 
maximum number of animals and birds permitted in the requested 
building.
    (ii) If APHIS personnel at the Animal Import Center determine the 
number of animals and birds requested by the importer can be housed in 
the space requested, but two animal health technicians cannot fulfill 
the routine husbandry needs of the number of animals or birds proposed 
by the importer, then the importer must either:
    (A) Pay for additional services on an hourly basis; or
    (B) Reduce the number of animals or birds to be quarantined to a 
number which APHIS personnel at the Animal Import Center determine can 
be handled by two animal health technicians.
    (iii) If the importer requests additional services, then APHIS will 
calculate the user fees for any service rendered by an APHIS 
representative at the hourly rate user fee found online at 
www.aphis.usda.gov/business-services/vs-vd-fees for each employee 
required to perform the service.
    (iv) The importer must either provide feed or pay for it on an 
actual cost basis, including the cost of delivery to the APHIS owned or 
operated Animal Import Center or quarantine facility, for any animal or 
bird that requires a diet other than standard feed, including but not 
limited to diets of fruit, insects, nectar, or fish.
    (d) User fees for inspection of live animals at land border ports 
along the United States-Canada border. If a service must be conducted 
on a Sunday or holiday or at any other time outside the normal tour of 
duty of the employee, then reimbursable overtime, as provided for in 
part 97 of this chapter, must be paid for each service, in addition to 
the user fee found online at www.aphis.usda.gov/business-services/vs-vd-fees.
    (e) User fees for pet birds. (1) Based on the information provided 
to APHIS personnel, APHIS personnel at the Animal Import Center or 
other APHIS owned or supervised quarantine facility will determine the 
appropriate number of birds that should be housed per isolette.
    (2) If the importer requests additional services, then APHIS will 
calculate the user fees for those services at the hourly rate user fee 
found online at www.aphis.usda.gov/business-services/vs-vd-fees for 
each employee required to perform the service.
    (f) User fees for endorsing export certificates. (1) User fees for 
the endorsement of export health certificates that require the 
verification of tests or vaccinations are found online at 
www.aphis.usda.gov/business-services/vs-vd-fees. APHIS will calculate 
the user fees to apply to each export health certificate endorsed \1\ 
for animals and birds based on the number of animals or birds covered 
by the certificate and the number of tests or vaccinations required. 
However, there will be a maximum user fee of 12 times the hourly rate 
user fee.

    \1\ An export health certificate may need to be endorsed for an 
animal being exported from the United States if the country to which 
the animal is being shipped requires one. APHIS endorses export 
health certificates as a service.

    (2) If an export certificate covers more than one animal, but the 
number of tests required for different animals are not the same, the 
user fee for the certificate is the fee which would be due if all the 
animals on the certificate required the same number of tests as the 
animal which requires the greatest number of tests.
    (3) The user fees referenced in this section will not apply to an 
export health certificate if:
    (i) An APHIS veterinarian prepares the certificate for endorsement 
completely at the site of the inspection in the course of performing 
inspection or supervision services for the animals listed on the 
certificate; and
    (ii) An APHIS user fee is payable under Sec.  130.4 for the 
inspection or supervision services performed by the veterinarian.
    (4) If a service must be conducted on a Sunday or holiday or at any 
other time outside the normal tour of duty of the employee, then 
reimbursable overtime, as provided for in part 97 of this chapter, must 
be paid for each service, in addition to the user fee listed in this 
section.
    (g) User fees for inspection services outside the United States. 
(1) If inspection services (including inspection, testing, and 
supervision services) are performed outside the United States, in 
accordance with this title, and the regulations do not contain a 
provision for payment of the cost of the service, the person requesting 
the service must pay a user fee.
    (2) Any person who wants APHIS to provide inspection services 
outside the

[[Page 59738]]

United States must contact the Animal and Plant Health Inspection 
Service, Veterinary Services, Strategy and Policy, Live Animal Imports 
at [email protected], to make an agreement.
    (3) All agreements for inspection services outside the United 
States must include:
    (i) Name, mailing address, and telephone number of either the 
person requesting the inspection services, or his or her agent;
    (ii) Explanation of inspection services to be provided, including 
the regulations in this chapter which provide for the services;
    (iii) Date(s) and time(s) the inspection services are to be 
provided;
    (iv) Location (including street address) where inspection services 
are to be provided;
    (v) An estimate of the actual cost, as calculated by APHIS, to 
provide the described inspection services for 6 months;
    (vi) A statement that APHIS agrees to provide the inspection 
services;
    (vii) A statement that the person requesting the inspection 
services, or, if appropriate, his or her agent, agrees to pay, at the 
time the agreement is entered into, a user fee equal to the estimated 
cost of providing the described inspection services for 6 months; and
    (viii) A statement that the person requesting the inspection 
services, or, if appropriate, his or her agent, agrees to maintain a 
user fee payment account equal to the cost of providing the described 
inspection services for 6 months, as calculated monthly by APHIS.
    (4) APHIS will enter into an agreement only if qualified personnel 
can be made available to provide the inspection services.
    (5) An agreement can be terminated by either party on 30 days 
written notice.
    (6) If, at the time an agreement is terminated, any unobligated 
funds remain in the user fee payment account, APHIS will refund the 
funds to the person who requested the inspection services, or his or 
her agent.


Sec.  130.4  Hourly rate and minimum user fees.

    (a) Services subject to hourly rate user fees. User fees for 
import- or export-related veterinary services listed in paragraphs 
(a)(1) through (18) of this section, except those services covered by 
flat rate user fees, will be calculated at the hourly rate found online 
at www.aphis.usda.gov/business-services/vs-vd-fees, for each employee 
required to perform the service. The person for whom the service is 
provided and the person requesting the service are jointly and 
severally liable for payment of these user fees in accordance with 
Sec. Sec.  130.6 and 130.7.
    (1) Providing services to live animals for import or entry at 
airports, ocean ports, and rail ports.
    (2) Conducting inspections, including inspections of laboratories 
and facilities (such as biosecurity level two facilities), required 
either to obtain import permits for animal products and byproducts, 
aquaculture products, or organisms or vectors, or to maintain 
compliance with import permits. This hourly rate does not apply to 
inspection and approval of import/export facilities and establishments.
    (3) Obtaining samples required to be tested, either to obtain 
import permits or to ensure compliance with import permits.
    (4) Providing services for imported birds or ratites that are not 
subject to quarantine, such as monitoring birds--including but not 
limited to pet birds--between flights.
    (5) Supervising the opening of in-bond shipments.
    (6) Providing services for in-bond or in-transit animals to exit 
the United States.
    (7) Inspecting an export isolation facility and the animals in it.
    (8) Supervising animal or bird rest periods prior to export.
    (9) Supervising loading and unloading of animals or birds for 
export shipment.
    (10) Inspecting means of conveyance used to export animals or 
birds.
    (11) Conducting inspections under part 156 of this chapter.
    (12) Inspecting and approving an artificial insemination center or 
a semen collection center or the animals in it.
    (13) Import or entry services for feeder animals including, but not 
limited to, feeder goats and feeder bison not covered by a flat rate 
user fee in connection with activities described in Sec.  130.3(d).
    (14) Export-related bird banding for identification.
    (15) Export-related inspection and approval of pet food facilities, 
including laboratories that perform pet food testing.
    (16) Export-related services provided at animal auctions.
    (17) Various export-related facility inspections, including, but 
not limited to, fertilizer plants that utilize poultry waste, rendering 
plants, and potential embarkation facilities.
    (18) Providing other import-or export-related veterinary services 
for which no flat rate user fee is specified.
    (b) When do I pay an additional amount for employee(s) working 
overtime? You must pay an additional amount if you need an APHIS 
employee to work on a Sunday, on a holiday, or at any time outside the 
normal tour of duty of that employee. Instead of paying the hourly rate 
user fee, you pay the rate found online at www.aphis.usda.gov/business-services/vs-vd-fees for each employee needed to get the work done.


Sec.  130.5  Exemptions.

    (a) Veterinary diagnostics. APHIS will not charge user fees for 
veterinary diagnostic services under the following conditions:
    (1) When veterinary diagnostic services are provided in connection 
with Federal programs to control or eradicate diseases or pests of 
livestock or poultry in the United States (program diseases);
    (2) When veterinary diagnostic services are provided in support of 
zoonotic disease surveillance when the Administrator has determined 
that there is a significant threat to human health; and
    (3) When veterinary diagnostic reagents are distributed within the 
United States for testing for foreign animal diseases.
    (b) [Reserved]


Sec.  130.6   Payment of user fees.

    (a) Who must pay APHIS user fees? Any person for whom a service is 
provided related to the importation, entry, or exportation of an 
animal, article, or means of conveyance or related to veterinary 
diagnostics, and any person requesting such service, shall be jointly 
and severally liable for payment of fees assessed.
    (b) Associated charges. (1) Reservation fee. Any reservation fee 
paid by an importer under part 93 of this chapter will be applied to 
the APHIS user fees described in Sec.  130.3(b) and (c) for animals or 
birds quarantined in an animal import center.
    (2) Special handling expenses. The user fees in this part do not 
include any costs that may be incurred due to special mail handling, 
including, but not limited to, express, overnight, or foreign mailing. 
If any service requires special mail handling, the user must pay all 
costs incurred, in addition to the user fee for the service.
    (3) When do I pay an additional amount for employee(s) working 
overtime? You must pay an additional amount if you need an APHIS 
employee to work on a Sunday, on a holiday, or at any time outside the 
normal tour of duty of that employee. You pay the amount specified in 
paragraphs (b)(3)(i), (ii), or (iii) of this section as relevant, for

[[Page 59739]]

each employee needed to get the work done.
    (i) What additional amount do I pay if I receive a flat rate user 
fee service? In addition to the flat rate user fee(s), you pay the 
overtime rate listed in the following table for each employee needed to 
get the work done:

                                  Table 1--Overtime for Flat Rate User Fees 1 2
----------------------------------------------------------------------------------------------------------------
                                                                           Overtime rates by hour
                                         Outside of the    -----------------------------------------------------
          Service provided             employee's  normal     Nov. 2, 2015-     Oct. 1, 2016-
                                          tour of duty       Sept. 30, 2016    Sept. 30, 2017    Beginning  Oct.
                                                                                                     1, 2017
----------------------------------------------------------------------------------------------------------------
Rate for inspection, testing,        Monday through                      $75               $75               $75
 certification or quarantine of       Saturday and          ................  ................  ................
 animals, animal products or other    holidays.                           99                99               100
 commodities \3\.                    Sundays..............
Rate for commercial airline          Monday through                       64                65                65
 inspection services \4\.             Saturday and          ................  ................  ................
                                      holidays.                           85                86                86
                                     Sundays..............
----------------------------------------------------------------------------------------------------------------
\1\ APHIS will charge of 2 hours, unless performed on the employee's regular workday and performed in direct
  continuation of the regular workday or begun within an hour of the regular workday,
\2\ When the 2-hour minimum applies, you may need to pay commuted travel time. (See Sec.   97.1(b) of this
  chapter for specific information about commuted travel time.)
\3\ See Sec.   97.1(a)of this chapter or 7 CFR 354.3 for details.
\4\ See Sec.   97.1(a)(3) of this chapter for details.

    (ii) What amount do I pay if I receive an hourly rate user fee 
service? Instead of paying the normal hourly rate user fee described in 
Sec.  130.4(a), you pay the premium rate described in Sec.  130.4(b) 
for each employee needed to get the work done:
    (c) When are APHIS user fees due?--(1) Animal and bird quarantine 
and related tests. User fees for animals and birds in an Animal Import 
Center or privately operated permanent or temporary import quarantine 
facilities, including user fees for tests conducted on these animals or 
birds, must be paid prior to the release of those animals or birds from 
quarantine.
    (2) Supervision and inspection services for export animals, animal 
products and byproducts. User fees for supervision and inspection 
services described in Sec.  130.4 must be paid when billed, or, if 
covered by a compliance agreement signed in accordance with this 
chapter, must be paid as specified in the agreement.
    (3) Export health certificates. User fees for export health 
certificates described in Sec.  130.3(f) must be paid prior to receipt 
of endorsed certificates. If APHIS determines that the user has 
established an acceptable credit history, the user may request to pay 
when billed.
    (4) Veterinary diagnostics. User fees specified for veterinary 
diagnostic services, such as tests on samples submitted to NVSL or 
FADDL, diagnostic reagents, slide sets, tissue sets, and other 
veterinary diagnostic services, must be paid when the veterinary 
diagnostic service is requested. If APHIS determines that the user has 
established an acceptable credit history, the user may request to pay 
when billed.
    (5) Other user fee services. User fees for import or entry services 
for land border ports along the United States-Mexico or United States-
Canada border, inspection of germplasm being exported, release from 
export agricultural hold, and other services described in Sec.  130.4 
must be paid when service is provided (for example when live animals 
are inspected when presented for importation at a port of entry). If 
APHIS determines that the user has established an acceptable credit 
history, the user may request to pay when billed.
    (d) What payment methods are acceptable? Payment must be for the 
exact amount due and may be paid by:
    (1) Cash will be accepted only during normal business hours if 
payment is made at an APHIS office or an Animal Import Center;
    (2) All types of checks, including traveler's checks, drawn on a 
U.S. bank in U.S. dollars and made payable to the U.S. Department of 
Agriculture or USDA;
    (3) Money orders, drawn on a U.S. bank in U.S. dollars and made 
payable to the U.S. Department of Agriculture or USDA; or
    (4) Credit cards (VISA\TM\ and MasterCard\TM\) if payment is made 
at an Animal Import Center or an APHIS office that is equipped to 
process credit cards.


Sec.  130.7  Penalties for nonpayment or late payment.

    (a) Unpaid debt. If any person for whom the service is provided 
fails to pay when due any debt to APHIS, including any user fee due 
under 7 CFR chapter III or this chapter, then:
    (1) Subsequent user fee payments. Payment must be made for 
subsequent user fees before the service is provided if:
    (i) For unbilled fees, the user fee is unpaid 60 days after the 
date the pertinent regulatory provision indicates payment is due; or
    (ii) For billed fees, the user fee is unpaid 60 days after date of 
bill; or
    (iii) The person for whom the service is provided or the person 
requesting the service has not paid the late payment penalty or 
interest on any delinquent APHIS user fee; or
    (iv) Payment has been dishonored.
    (2) Resolution of difference between estimate and actual. APHIS 
will estimate the user fee to be paid; any difference between the 
estimate and the actual amount owed to APHIS will be resolved as soon 
as reasonably possible following the delivery of the service, with 
APHIS returning any excess to the payor or billing the payor for the 
additional amount due.
    (3) Prepayment form. The prepayment must be in guaranteed form, 
such as money order, certified check, or cash. Prepayment in guaranteed 
form will continue until the debtor pays the delinquent debt.
    (4) Denied service. Service will be denied until the debt is paid 
if:
    (i) For unbilled fees, the user fee is unpaid 90 days after date 
the pertinent regulatory provision indicates payment is due; or
    (ii) For billed fees, the user fee is unpaid 90 days after date of 
bill; or
    (iii) The person for whom the service is provided or the person 
requesting the service has not paid the late payment penalty or 
interest on any delinquent APHIS user fee; or
    (iv) Payment has been dishonored.
    (b) Unpaid debt during service. If APHIS is in the process of 
providing a

[[Page 59740]]

service for which an APHIS user fee is due, and the user has not paid 
the fee within the time required, or if the payment offered by the user 
is inadequate or unacceptable, then APHIS will take the following 
action:
    (1) Animals or birds in quarantine. If an APHIS user fee is due for 
animals or birds in quarantine at an animal import center or at a 
privately operated import quarantine facility, APHIS will not release 
them.
    (2) Export health certificate. If an APHIS user fee specified is 
due for an export health certificate, APHIS will not release the 
certificate.
    (3) Veterinary diagnostics. If an APHIS user fee is due for a 
veterinary diagnostic test or service, APHIS will not release the test 
result, any endorsed certificate, or any other veterinary diagnostic 
service.
    (c) Late payment penalty. In addition to the actions described in 
paragraph (b) of this section, APHIS will impose a late payment penalty 
and interest charges in accordance with 31 U.S.C. 3717 for:
    (1) Unbilled user fees, if the user fees are unpaid 30 days after 
the date the pertinent regulatory provisions indicate payment is due; 
or
    (2) Billed user fees, if the user fees are unpaid 30 days after the 
date of the bill.
    (d) Dishonored payment penalties. User fees paid with dishonored 
forms of payment, such as a check returned for insufficient funds, will 
be subject to interest and penalty charges in accordance with 31 U.S.C. 
3717. Administrative charges will be assessed at $20.00 per dishonored 
payment to be paid in addition to the original amount owed. Payment 
must be in guaranteed form, such as cash, money order, or certified 
check.
    (e) Debt collection management. In accordance with the Debt 
Collection Improvement Act of 1996, the following provisions apply:
    (1) Taxpayer identification number. APHIS will collect a taxpayer 
identification number from all persons, other than Federal agencies, 
who are liable for a user fee.
    (2) Administrative offset. APHIS will notify the Department of 
Treasury of debts that are over 180 days delinquent for the purposes of 
administrative offset. Under administrative offset, the Department of 
Treasury will withhold funds payable by the United States to a person 
(i.e., Federal income tax refunds) to satisfy the debt to APHIS.
    (3) Cross-servicing. APHIS will transfer debts that are over 180 
days delinquent to the Department of Treasury for cross-servicing. 
Under cross-servicing, the Department of Treasury will collect debts on 
behalf of APHIS. Exceptions will be made for debts that meet certain 
requirements, for example, debts that are already at a collection 
agency or in payment plan.
    (4) Report delinquent debt. APHIS will report all unpaid debts to 
credit reporting bureaus.
    (f) Animals or birds abandoned after quarantine at an animal import 
center. Animals or birds left in quarantine at an animal import center 
for more than 30 days after the end of the required quarantine period 
will be deemed to be abandoned.
    (1) After APHIS releases the abandoned animals or birds from 
quarantine, APHIS may seize them and sell or otherwise dispose of them, 
as determined by the Administrator, provided that their sale is not 
contrary to any Federal law or regulation. APHIS may recover all 
expenses of handling the animals or birds from the proceeds of their 
sale or disposition.
    (2) If animals or birds abandoned in quarantine at an animal import 
center cannot be released from quarantine, APHIS may seize and dispose 
of them, as determined by the Administrator, and may recover all 
expenses of handling the animals or birds from the proceeds of their 
disposition and from persons liable for user fees under Sec.  130.6(a).

    Done in Washington, DC, this 15th day of September 2022.
Anthony Shea,
Administrator, Animal and Plant Health Inspection Service.
[FR Doc. 2022-21030 Filed 9-30-22; 8:45 am]
BILLING CODE 3410-34-P