Changes in Hourly Fee Rates for Science and Technology Laboratory Services-Fiscal Years 2007-2009, 55369-55380 [06-7821]

Download as PDF 55369 Federal Register / Vol. 71, No. 184 / Friday, September 22, 2006 / Proposed Rules (b) * * * Subpart—United States Standards for Grades of Table Grapes (European or Vinifera Type) § 51.886 * * Tolerances. * * * TABLE II.—TOLERANCES EN ROUTE OR AT DESTINATION U.S. extra fancy table Factor (A) For bunches failing to meet color requirements .................................................................... (B) For bunches failing to meet requirements for minimum diameter of berries ........................ (C) For bunches failing to meet stem color requirements .......................................................... (D) For offsize bunches and for bunches and berries failing to meet the remaining requirements for the grade .................................................................................................................. (E) For shattered berries in consumer size packages an allowance of 10 percent is provided. Any percent of shattered berries exceeding the allowance of 10 percent shall be scored as berries failing to meet the requirements of the grade. Including in (D): (a) For permanent defects .................................................................................................... (b) For serious damage ........................................................................................................ And, including in (b): (i) For serious damage by permanent defects ..................................................................... (ii) For decay ........................................................................................................................ Dated: September 15, 2006. Lloyd C. Day, Administrator, Agricultural Marketing Service. [FR Doc. 06–7869 Filed 9–21–06; 8:45 am] BILLING CODE 3410–02–P DEPARTMENT OF AGRICULTURE Agricultural Marketing Service 7 CFR Parts 91 and 92 [Docket Number ST–05–01] RIN 0581–AC48 Changes in Hourly Fee Rates for Science and Technology Laboratory Services—Fiscal Years 2007–2009 Agricultural Marketing Service, USDA. ACTION: Proposed rule with request for comments. jlentini on PROD1PC65 with PROPOSAL AGENCY: SUMMARY: The Agricultural Marketing Service (AMS) is proposing to change the hourly fee rates for Science and Technology (S&T) Laboratory Services. The agency is proposing to raise these rates to reflect, among other factors, national and locality pay increases for Federal employees and inflation, operating costs, instrumentation and training, and program and agency administrative overhead costs. In the past, AMS has amended its regulations on an as needed basis in order to recover laboratory program costs. With this proposed regulation, AMS is providing for three annual standard hourly fee rate increases for fiscal years VerDate Aug<31>2005 19:43 Sep 21, 2006 Jkt 208001 2007–2009. This would provide the agricultural commodity industries and other stakeholders with more timely and relevant information regarding voluntary user fees for laboratory testing services. The agency is also proposing to remove tables and schedules with listings of individual tests and services. Three annual hourly fee rate adjustments are proposed for appeals, holiday, and overtime services to reflect the anticipated increase in cost of providing these laboratory services each fiscal year. The regulations also are updated to identify current facility addresses. Part 92 is obsolete and therefore has been removed. DATES: Comments must be received on or before October 23, 2006. ADDRESSES: Send comments to James V. Falk, Docket Manager, USDA, AMS, Science and Technology Programs, 1400 Independence Avenue, SW., Mail Stop 0272, Washington, DC 20250–0272; telephone (202) 690–4089; fax (202) 720–4631, or e-mail: James.falk@usda.gov. State that your comments refer to Docket No. ST–05– 01. Comments may also be submitted electronically through https:// www.regulations.gov. Submitted comments will be available for public inspection during regular business hours in Room 1090 South Building, U.S. Department of Agriculture, 1400 Independence Avenue, SW., Washington, DC. FOR FURTHER INFORMATION CONTACT: Dr. Robert L. Epstein, Science and Technology Programs, Agricultural Marketing Service, United States Department of Agriculture, Mail Stop PO 00000 Frm 00016 Fmt 4702 Sfmt 4702 U.S. fancy table U.S. No. 1 table 10 10 10 10 10 10 10 12 12 12 8 4 8 4 8 4 2 1 2 1 2 1 0270, 1400 Independence Avenue, SW., Washington, DC 20250–0270, telephone number (202) 720–5231; fax (202) 720– 6496, and e-mail: Robert.epstein@usda.gov. SUPPLEMENTARY INFORMATION: Background Science and Technology (S&T) Programs has been performing voluntary laboratory services under the Agricultural Marketing Act of 1946, as amended, for the AMS commodity programs (Fruit and Vegetable, Cotton, Livestock and Seed, Poultry, Dairy, and Tobacco) and applicable customers in these industries since its inception on August 17, 1988. Before that, voluntary laboratory testing was provided for a user fee by AMS under the various commodity programs. The current standard hourly rate of $45.00 and the premium hourly rate of $67.50 have been in effect since publication in the Federal Register on October 27, 2000 (65 FR 64302). The standard fee rate for laboratory services is proposed to be increased to $60.00 per hour in fiscal year 2007, $63.00 per hour in fiscal year 2008, and $67.00 per hour in fiscal year 2009. The premium hourly fee rates would also be adjusted for fiscal years 2007 through 2009. An increase in the premium hourly rates over the three fiscal years for laboratory services performed on holidays, appeal samples, and overtime basis is also needed since Science and Technology laboratory personnel may be required to work extended hours of service at the time and a half pay or the double hourly pay to accommodate clients. This is due to E:\FR\FM\22SEP1.SGM 22SEP1 55370 Federal Register / Vol. 71, No. 184 / Friday, September 22, 2006 / Proposed Rules stakeholder demand for immediate test results. Generally, the processing of all laboratory samples is continuous over a 24/7 timeframe due to the recent introduction of automated equipment. The AMS laboratory testing programs are voluntary, user fee services, conducted under the authority of the Agricultural Marketing Act of 1946 (AMA), as amended (7 U.S.C. 1621, et seq.). The AMA authorizes the Secretary of Agriculture to provide Federal analytical testing services that facilitate marketing and trade. In addition, consumers may be able to determine the quality and wholesomeness characteristics of a commodity or product through laboratory testing. This allows agricultural products to be assigned official AMS grade designations or to meet specifications. The AMA also requires that reasonable fees be collected from the users of the services to cover as nearly as possible the costs of maintaining the programs. AMS regularly reviews its user-feesupported laboratory service programs to determine if the voluntary fees are adequate to cover expenses. The most recent review determined that the existing fee schedules and tables of individual tests or services, which have been in place since October 27, 2000, will not generate sufficient revenues to recover operating costs. A more flexible user fee system, using set hourly rates for multiple fiscal years, is proposed by this rulemaking to ensure that AMS properly recovers its full costs for providing laboratory services, and that all stakeholders are charged reasonable fees. By enacting a three year fee increase instead of a single year fee increase, AMS would help ensure that the fee increases are effective at the beginning of each fiscal year (October 1). In addition, the existing fee schedules and tables in 7 CFR, part 91, § 91.37 would be removed. The analytical tests listed in the tables are not specific to individual commodity testing requirements or stakeholder needs. The current tables do not represent the actual operational costs to perform single tests and newer methodologies. Laboratory services are provided for five types of analytical testing: Microbiological, physical, residue chemistry, proximate analysis for composition, and biomolecular testing. AMS must recover the costs of providing these services. The proposed hourly fee rates would recover these costs. AMS calculated its actual costs for fiscal years 2001 through 2005 and its projected increases in salaries and inflation in fiscal years 2006 through 2009. The estimates for increases in salaries for fiscal year 2006 as the base year and the succeeding out years are from the Office of Management and Budget’s (OMB) multi-year ‘‘Economic Assumptions’’ tables. The Federal pay raise for calendar years 2002, 2003, and 2004 were 4.6 percent, 4.1 percent and 4.1 percent, respectively. This information comes from Table 11–1, ‘‘Economic Assumptions’’, of the Office of Management and Budget’s Fiscal Year 2005 Budget which is available at https://www.whitehouse.gov/omb/ budget/fy2005/econ.html. The average fiscal year pay raise for Federal employees in calendar years 2005 and 2006 was 3.5 percent effective January 2005 and 3.1 percent effective January 2006. The average combined national and locality pay raise is estimated to be 2.2 percent for fiscal years 2007, 2008, and 2009. Inflation for fiscal year 2006 is estimated to be 2.1 percent. Inflation for fiscal year 2007 is estimated to be 2.2 percent. Inflation for fiscal year 2008 is estimated to be 2.1 percent. Inflation for fiscal year 2009 is estimated to be 2.1 percent. These estimates for inflation percent can be obtained from Table 12– 1, ‘‘Economic Assumptions’’, of the OMB’s Fiscal Year 2007 Budget which is available at https://www.whitehouse.gov/omb/ budget/fy2007/econ.html. The Agency will initiate another rulemaking to adjust any fee established, if estimated increases for pay and inflation do not adequately cover the Agency’s costs of providing the services. The cost of providing laboratory services includes both direct and overhead costs. Direct costs include the cost of salaries, employee benefits, operation cost and infrastructure cost. The Agency is able to estimate the employee benefits attributable to overtime work and has included these in the fee calculations. TABLE 1.—CURRENT AND PROPOSED HOURLY FEE RATES (PER HOUR) BY TYPE OF SERVICE Service Current rate Laboratory ........................................................................................................................ Appeal .............................................................................................................................. Overtime .......................................................................................................................... Legal Holiday ................................................................................................................... 1 2 3 Hourly $ 45.00 67.50 67.50 67.50 FY 2007 rate 1 $ 60.00 71.00 71.00 82.00 FY 2008 rate 2 $ 63.00 74.00 74.00 85.00 FY 2009 rate 3 $ 67.00 78.00 78.00 89.00 values for FY 2007–FY 2009 are rounded off to nearest whole dollar. With this proposed action, the AMS would amend its regulations to provide for three annual fee increases in one action. Table 1 shows the summary of the current rates and the proposed hourly fee rates for fiscal years 2007 through 2009 for the four different types of services (regular laboratory, appeal, overtime, and legal holiday work) that Science and Technology Programs employees perform. TABLE 2.—CALCULATIONS FOR THE STANDARD HOURLY RATE FOR LABORATORY PROGRAM SERVICES FOR FY 2006 Apportioned fee rate jlentini on PROD1PC65 with PROPOSAL Laboratory services Base Time: Actual FY 2005 Salaries 1 @ $2,787,474 .................................................................................................................................... FY 2006 Pay Adjustment 2 = [Actual FY 2005 Salaries ($20.00)] x 0.031 + $0.86 (weighted portion @ $119,500 increase for the FY 2006 period changes with payroll for within-grade pay step increases for General Schedule salaries, promotion pay costs and new employee position pay costs) .................................................................................................................... Benefits 3 ....................................................................................................................................................................................... Operational Costs 4 ....................................................................................................................................................................... Infrastructure Costs 5 .................................................................................................................................................................... VerDate Aug<31>2005 19:43 Sep 21, 2006 Jkt 208001 PO 00000 Frm 00017 Fmt 4702 Sfmt 4702 E:\FR\FM\22SEP1.SGM 22SEP1 $20.00 1.48 6.90 11.60 8.78 Federal Register / Vol. 71, No. 184 / Friday, September 22, 2006 / Proposed Rules 55371 TABLE 2.—CALCULATIONS FOR THE STANDARD HOURLY RATE FOR LABORATORY PROGRAM SERVICES FOR FY 2006— Continued Apportioned fee rate Laboratory services Program Overhead 6 ..................................................................................................................................................................... Agency Overhead 7 ....................................................................................................................................................................... FY 2006 Inflation (2.1 %) = [Costs excluding infrastructure and payroll] x .021. ........................................................................ 3.44 3.28 0.53 Total Rate Per Hour—Base Time ......................................................................................................................................... 56.01 1 Actual 2 Actual 3 Actual 4 Actual 5 Actual 6 Actual 7 Actual cost cost cost cost cost cost cost of of of of of of of FY 2005 salaries ($2,787,474) ÷ (2,080 program hours times 67 program employees) = $20.00 unit cost. FY 2006 pay adjustment ($205,911) ÷ (2,080 program hours times 67 program employees) = $1.48 unit cost. benefits ($961,668) ÷ (2,080 program hours times 67 program employees) = $6.90 unit cost. operational costs ($1,616,645) ÷ (2,080 program hours times 67 program employees) = $11.60 unit cost. infrastructure ($1,223,570) ÷ (2,080 program hours times 67 program employees) = $8.78 unit cost. Program overhead ($479,000) ÷ (2,080 program hours times 67 program employees) = $3.44 unit cost. Agency overhead ($457,000) ÷ (2,080 program hours times 67 program employees) = $3.28 unit cost. TABLE 3.—CALCULATIONS FOR THE STANDARD HOURLY RATE FOR LABORATORY PROGRAM SERVICES FOR FY 2007 Apportioned fee rate Laboratory services Base Time: FY 2006 Salaries = Actual FY 2005 Salaries ($20.00) + FY 2006 Pay Adjustment ($1.48) ...................................................... FY 2007 Pay Adjustment = FY 2006 Salaries × 0.022 ............................................................................................................... Benefits ......................................................................................................................................................................................... Operational Costs ......................................................................................................................................................................... Infrastructure Cost ........................................................................................................................................................................ Program Overhead ....................................................................................................................................................................... Agency Overhead ......................................................................................................................................................................... FY 2006 Inflation (2.1%) = [Costs excluding infrastructure and payroll] × .021 .......................................................................... FY 2007 Inflation (2.2%) = [Costs excluding infrastructure and payroll] × 022 ........................................................................... $21.48 0.47 6.90 11.60 11.75 3.44 3.28 0.53 0.57 Total Rate Per Hour—Base Time ......................................................................................................................................... 60.02 TABLE 4.—CALCULATIONS FOR THE STANDARD HOURLY RATE FOR LABORATORY PROGRAM SERVICES FOR FY 2008 Apportioned fee rate Laboratory services Base Time: FY 2007 Salaries = FY 2006 Salaries ($21.48) + FY 2007 Pay Adjustment ($0.47) ................................................................. FY 2008 Pay Adjustment = FY 2007 Salaries × 0.022 ............................................................................................................... Benefits ......................................................................................................................................................................................... Operational Costs ......................................................................................................................................................................... Infrastructure Cost ........................................................................................................................................................................ Program Overhead ....................................................................................................................................................................... Agency Overhead ......................................................................................................................................................................... FY 2006 Inflation (2.1%) = [Costs excluding infrastructure and payroll] × .021 .......................................................................... FY 2007 Inflation (2.2%) = [Costs excluding infrastructure and payroll] × .022 .......................................................................... FY 2008 Inflation (2.1%) = [Costs excluding infrastructure and payroll] × .021 .......................................................................... $21.95 0.48 6.90 11.60 13.47 3.44 3.28 0.53 0.57 0.55 Total Rate Per Hour—Base Time ......................................................................................................................................... 62.77 TABLE 5.—CALCULATIONS FOR THE STANDARD HOURLY RATE FOR LABORATORY PROGRAM SERVICES FOR FY 2009 Apportioned fee rate jlentini on PROD1PC65 with PROPOSAL Laboratory services Base Time: FY 2008 Salaries = FY 2007 Salaries ($21.95) + FY 2008 Pay Adjustment ($0.48) ................................................................. FY 2009 Pay Adjustment = FY 2008 Salaries × 0.022 ............................................................................................................... Benefits ......................................................................................................................................................................................... Operational Costs ......................................................................................................................................................................... Infrastructure Cost ........................................................................................................................................................................ Program Overhead ....................................................................................................................................................................... Agency Overhead ......................................................................................................................................................................... FY 2006 Inflation (2.1%) = [Costs excluding infrastructure and payroll] × .021 .......................................................................... FY 2007 Inflation (2.2%) = [Costs excluding infrastructure and payroll] × .022 .......................................................................... FY 2008 Inflation (2.1%) = [Costs excluding infrastructure and payroll] × .021 .......................................................................... FY 2009 Inflation (2.1%) = [Costs excluding infrastructure and payroll] × .021 .......................................................................... VerDate Aug<31>2005 19:43 Sep 21, 2006 Jkt 208001 PO 00000 Frm 00018 Fmt 4702 Sfmt 4702 E:\FR\FM\22SEP1.SGM 22SEP1 $22.43 0.49 6.90 11.60 16.15 3.44 3.28 0.53 0.57 0.55 0.56 55372 Federal Register / Vol. 71, No. 184 / Friday, September 22, 2006 / Proposed Rules TABLE 5.—CALCULATIONS FOR THE STANDARD HOURLY RATE FOR LABORATORY PROGRAM SERVICES FOR FY 2009— Continued Apportioned fee rate Laboratory services Total Rate Per Hour—Base Time ......................................................................................................................................... In order to project the hourly fee rates for the laboratory program services for fiscal years 2007 through 2009, the current fiscal year 2006 is used as a base. The total base time hourly fee rate calculation (Table 2) for fiscal year 2006 begins with the actual salaries for fiscal year 2005 ($2,787,474) and adds the fiscal year 2006 pay raises (3.1 percent) and add other fiscal year 2006 pay adjustments ($119,500) for within-grade pay step increases for General Schedule (GS) salaries, promotion pay costs, and new employee position pay costs. Table 2 contains footnotes 1–7 that provide the common mathematical formula used to calculate the apportioned rate for each fee charge category for fiscal year 2006. The formula uses the actual cost or projected cost in dollars for the applicable fiscal year for each individual fee charge category divided by the available program hours and further divided by the number of laboratory service program employees. The formula derives the apportioned fee rate for each fee charge category (salaries with pay adjustment, benefits, 66.50 operational costs, infrastructure cost, program administrative overhead and agency overhead). The same formula that is used in Table 2 and that is indicated in its footnotes is also applied in the other tables to derive each category unit rate with the different actual costs or variable projected costs to be inserted in the formula equation for the applicable fiscal year. Table 3 through Table 5 show the calculation of the total standard hourly fee rates to be rounded off for fiscal years 2007 through 2009. TABLE 6.—CALCULATIONS FOR THE APPEAL AND OVERTIME HOURLY RATES FOR LABORATORY PROGRAM SERVICES FOR FY 2006 Apportioned fee rate Laboratory services Appeal and Overtime Rates: Actual Salaries @ 1.5 (time and a half): FY 2005 Salaries @ 1.5 = [Actual 2005 Salaries ($20.00)] × 1.5 ............................................................................................... FY 2006 Pay Adjustment = [Actual FY 2005 Salaries ($20.00) × 0.031 + $0.86 (weighted portion @ $119,500 increase for the FY 2006 period changes with payroll for within-grade pay step increases for General Schedule salaries, promotion pay costs, and new employee position pay costs)] × 1.5 ........................................................................................................ Benefits ......................................................................................................................................................................................... Operational Costs ......................................................................................................................................................................... Infrastructure Cost ........................................................................................................................................................................ Program Overhead ....................................................................................................................................................................... Agency Overhead ......................................................................................................................................................................... FY 2006 Inflation (2.1%) = [Costs excluding infrastructure and payroll] × .021 .......................................................................... Total Rate Per Hour—Appeal and Overtime ........................................................................................................................ $30.00 2.22 6.90 11.60 8.78 3.44 3.28 0.53 66.75 TABLE 7.—CALCULATIONS FOR THE APPEAL AND OVERTIME HOURLY RATES FOR LABORATORY PROGRAM SERVICES FOR FY 2007 Apportioned fee rate Laboratory services $32.22 0.71 6.90 11.60 11.75 3.44 3.28 0.53 0.57 Total Rate Per Hour—Appeal and Overtime ........................................................................................................................ jlentini on PROD1PC65 with PROPOSAL Appeal and Overtime Rates: Actual Salaries @ 1.5 (time and a half): FY 2006 Salaries @ 1.5 = [Actual 2005 Salaries ($20.00) + 2006 Pay Adjustment ($1.48)] × 1.5 ........................................... FY 2007 Pay Adjustment = FY 2006 Salaries @ 1.5 × 0.022 .................................................................................................... Benefits ......................................................................................................................................................................................... Operational Costs ......................................................................................................................................................................... Infrastructure Cost ........................................................................................................................................................................ Program Overhead ....................................................................................................................................................................... Agency Overhead ......................................................................................................................................................................... FY 2006 Inflation (2.1%) = [Costs excluding infrastructure and payroll] × .021 .......................................................................... FY 2007 Inflation (2.2%) = [Costs excluding infrastructure and payroll] × .022 .......................................................................... 71.00 TABLE 8.—CALCULATIONS FOR THE APPEAL AND OVERTIME HOURLY RATES FOR LABORATORY PROGRAM SERVICES FOR FY 2008 Apportioned fee rate Laboratory services Appeal and Overtime Rates: Actual Salaries @ 1.5 (time and a half): FY 2007 Salaries @ 1.5 = [FY 2006 Salaries ($21.48) + FY 2007 Pay Adjustment ($0.47)] × 1.5 ........................................... VerDate Aug<31>2005 19:43 Sep 21, 2006 Jkt 208001 PO 00000 Frm 00019 Fmt 4702 Sfmt 4702 E:\FR\FM\22SEP1.SGM 22SEP1 $32.93 Federal Register / Vol. 71, No. 184 / Friday, September 22, 2006 / Proposed Rules 55373 TABLE 8.—CALCULATIONS FOR THE APPEAL AND OVERTIME HOURLY RATES FOR LABORATORY PROGRAM SERVICES FOR FY 2008—Continued Apportioned fee rate Laboratory services FY 2008 Pay Adjustment = FY 2007 Salaries @ 1.5 × 0.022 .................................................................................................... Benefits ......................................................................................................................................................................................... Operational Costs ......................................................................................................................................................................... Infrastructure Cost ........................................................................................................................................................................ Program Overhead ....................................................................................................................................................................... Agency Overhead ......................................................................................................................................................................... FY 2006 Inflation (2.1%) = [Costs excluding infrastructure and payroll] × .021 .......................................................................... FY 2007 Inflation (2.2%) = [Costs excluding infrastructure and payroll] × .022 .......................................................................... FY 2008 Inflation (2.1%) = [Costs excluding infrastructure and payroll] × .021 .......................................................................... 0.72 6.90 11.60 13.47 3.44 3.28 0.53 0.57 0.55 Total Rate Per Hour—Appeal and Overtime ........................................................................................................................ 73.99 TABLE 9.—CALCULATIONS FOR THE APPEAL AND OVERTIME HOURLY RATES FOR LABORATORY PROGRAM SERVICES FOR FY 2009 Apportioned fee rate Laboratory services Appeal and Overtime Rates: Actual Salaries @ 1.5 (time and a half): FY 2008 Salaries @ 1.5 = [FY 2007 Salaries ($21.95) + FY 2008 Pay Adjustment ($0.48)] × 1.5 .................................................. FY 2009 Pay Adjustment = FY 2008 Salaries @ 1.5 × 0.022 ............................................................................................................ Benefits ......................................................................................................................................................................................... Operational Costs ......................................................................................................................................................................... Infrastructure Cost ........................................................................................................................................................................ Program Overhead ....................................................................................................................................................................... Agency Overhead ......................................................................................................................................................................... FY 2006 Inflation (2.1%) = [Costs excluding infrastructure and payroll] × .021 .......................................................................... FY 2007 Inflation (2.2%) = [Costs excluding infrastructure and payroll] × .022 .......................................................................... FY 2008 Inflation (2.1%) = [Costs excluding infrastructure and payroll] × .021 .......................................................................... FY 2009 Inflation (2.1%) = [Costs excluding infrastructure and payroll] × .021 .......................................................................... $33.65 0.74 6.90 11.60 16.15 3.44 3.28 0.53 0.57 0.55 0.56 Total Rate Per Hour—Appeal and Overtime ........................................................................................................................ 77.97 Table 6 through Table 9 show the calculation of the total appeal and total overtime hourly fee rates to be rounded off for fiscal years 2006 through 2009. These tables incorporate the differentials in costs associated with the necessity of laboratory personnel to work extended hours of service at the time and a half pay doing either overtime or appeal sample testing. TABLE 10.—CALCULATIONS FOR THE FEDERAL HOLIDAY HOURLY RATE FOR LABORATORY PROGRAM SERVICES FOR FY 2006 Apportioned fee rate Laboratory services Holiday Rate: Actual Salaries @ 2.0 (double time): FY 2005 Salaries @ 2.0 [Actual 2005 Salaries ($20.00)] × 2.0 .................................................................................................. FY 2006 Pay Adjustment = [Actual FY 2005 Salaries ($20.00) × 0.031 + $0.86 (weighted portion @ $119,500 increase for the FY 2006 period changes with payroll for within-grade pay step increases for General Schedule salaries, promotion pay costs, and new employee position pay costs)] × 2.0 ........................................................................................................ Benefits ......................................................................................................................................................................................... Operational Costs ......................................................................................................................................................................... Infrastructure Cost ........................................................................................................................................................................ Program Overhead ....................................................................................................................................................................... Agency Overhead ......................................................................................................................................................................... FY 2006 Inflation (2.1%) = [Costs excluding infrastructure and payroll] × .021 .......................................................................... jlentini on PROD1PC65 with PROPOSAL Total Rate Per Hour—Holidays ............................................................................................................................................. VerDate Aug<31>2005 19:43 Sep 21, 2006 Jkt 208001 PO 00000 Frm 00020 Fmt 4702 Sfmt 4702 E:\FR\FM\22SEP1.SGM 22SEP1 $40.00 2.96 6.96 11.60 8.78 3.44 3.28 0.53 77.49 55374 Federal Register / Vol. 71, No. 184 / Friday, September 22, 2006 / Proposed Rules TABLE 11.—CALCULATIONS FOR THE FEDERAL HOLIDAY HOURLY RATE FOR LABORATORY PROGRAM SERVICES FOR FY 2007 Apportioned fee rate Laboratory services Holiday Rate: Actual Salaries @ 2.0 (double time): FY 2006 Salaries @ 2.0 = [Actual 2005 Salaries ($20.00) + 2006 Pay Adjustment ($1.48)] × 2.0 ........................................... FY 2007 Pay Adjustment = FY 2006 Salaries @ 2.0 × 0.022 .................................................................................................... Benefits ......................................................................................................................................................................................... Operational Costs ......................................................................................................................................................................... Infrastructure Cost ........................................................................................................................................................................ Program Overhead ....................................................................................................................................................................... Agency Overhead ......................................................................................................................................................................... FY 2006 Inflation (2.1%) = [Costs excluding infrastructure and payroll] × .021 .......................................................................... FY 2007 Inflation (2.2%) = [Costs excluding infrastructure and payroll] × .022 .......................................................................... $42.96 0.95 6.90 11.60 11.75 3.44 3.28 0.53 0.57 Total Rate Per Hour—Holidays ............................................................................................................................................. 81.98 TABLE 12.—CALCULATIONS FOR THE FEDERAL HOLIDAY HOURLY RATE FOR LABORATORY PROGRAM SERVICES FOR FY 2008 Apportioned fee rate Laboratory services Holiday Rate: Actual Salaries @ 2.0 (double time): FY 2007 Salaries @ 2.0 = [FY 2006 Salaries ($21.48) + FY 2007 Pay Adjustment ($0.47)] × 2.0 ........................................... FY 2008 Pay Adjustment = FY 2007 Salaries @ 2.0 × 0.022 .................................................................................................... Benefits ......................................................................................................................................................................................... Operational Costs ......................................................................................................................................................................... Infrastructure Cost ........................................................................................................................................................................ Program Overhead ....................................................................................................................................................................... Agency Overhead ......................................................................................................................................................................... FY 2006 Inflation (2.1%) = [Costs excluding infrastructure and payroll] × .021 .......................................................................... FY 2007 Inflation (2.2%) = [Costs excluding infrastructure and payroll] × .022 .......................................................................... FY 2008 Inflation (2.1%) = [Costs excluding infrastructure and payroll] × .021 .......................................................................... $43.90 0.97 6.90 11.60 13.47 3.44 3.28 0.53 0.57 0.55 Total Rate Per Hour—Holidays ............................................................................................................................................. 85.21 TABLE 13.—CALCULATIONS FOR THE FEDERAL HOLIDAY HOURLY RATE FOR LABORATORY PROGRAM SERVICES FOR FY 2009 Apportioned fee rate Laboratory services $44.86 0.99 6.90 11.60 16.15 3.44 3.28 0.53 0.57 0.55 0.56 Total Rate Per Hour—Holidays ............................................................................................................................................. jlentini on PROD1PC65 with PROPOSAL Holiday Rate: Actual Salaries @ 2.0 (double time): FY 2008 Salaries @ 2.0 = [FY 2007 Salaries ($21.95) + FY 2008 Pay Adjustment ($0.48)] × 2.0 ........................................... FY 2009 Pay Adjustment = FY 2008 Salaries @ 2.0 × 0.022 .................................................................................................... Benefits ......................................................................................................................................................................................... Operational Costs ......................................................................................................................................................................... Infrastructure Cost ........................................................................................................................................................................ Program Overhead ....................................................................................................................................................................... Agency Overhead ......................................................................................................................................................................... FY 2006 Inflation (2.1%) = [Costs excluding infrastructure and payroll] × .021 .......................................................................... FY 2007 Inflation (2.2%) = [Costs excluding infrastructure and payroll] × .022 .......................................................................... FY 2008 Inflation (2.1%) = [Costs excluding infrastructure and payroll] × .021 .......................................................................... FY 2009 Inflation (2.1%) = [Costs excluding infrastructure and payroll] × .021 .......................................................................... 89.43 Table 10 through Table 13 show the calculation of the total legal holiday hourly fee rates to be rounded off for fiscal years 2006 through 2009. These tables incorporate the differentials in costs associated with the necessity of laboratory personnel to work extended hours of service at the double hourly pay rate doing sample testing on a VerDate Aug<31>2005 19:43 Sep 21, 2006 Jkt 208001 Federal holiday or a designated day for the Federal holiday. The Agency proposes to recover the actual cost of services for multiple fiscal years covered by this rule. These fee increases are essential for the continued sound financial management of the Agency’s budget. In order to enhance the transparency of the hourly fee rates in the aforementioned Tables 3 through PO 00000 Frm 00021 Fmt 4702 Sfmt 4702 13 for fiscal year 2007, fiscal year 2008 and fiscal year 2009, a description is provided of each fee charge category. Federal salaries with national and locality pay adjustments and choices in benefits are made available on an annual basis by the Office of Personnel Management (OPM). Operational costs include expenses for rents, communications, utilities, medical E:\FR\FM\22SEP1.SGM 22SEP1 jlentini on PROD1PC65 with PROPOSAL Federal Register / Vol. 71, No. 184 / Friday, September 22, 2006 / Proposed Rules examinations, safety equipment, sample preparation equipment, training, trash and hazardous waste disposal, travel and transportation costs. Communication expenditures include costs for photocopying, printing, emailing, Internet services, telephone, and faxing equipment. There have been large capital improvement expenditures in the laboratories in recent years. These expenditures include costs for the Food Emergency Response Network (FERN) and the capital improvements for the Environmental Management Systems (EMS) in accordance with the applicable mandates for Federal laboratories of Executive Order 13148 of April 21, 2000, Greening the Government Through Leadership in Environmental Management (65 FR 24593). These capital improvement costs are included in the normal operations of the Science and Technology field service laboratories. In addition, operational costs include expenses for office and laboratory supplies, chemicals, reagents, security and guard services, waste removal, robots, cleaning and internal building maintenance, billing and collection services, and a Laboratory Information Management System (LIMS). Infrastructure costs are mainly laboratory instruments and capital equipment with service and maintenance contracts and replacement spare parts. Infrastructure expenses include consumable supply costs associated directly with the proper operation of analytical instruments and laboratory equipment. Stakeholders demand that AMS provide cost effective and timely product testing requiring modern and sometimes automated instrumentation. These instruments are expensive and undergo equipment capitalization for determining costs. Equipment capitalization is the determined cost per year to replace the equipment after its useful service life has been established. Infrastructure costs include database acquisitions and maintenance for e-business. Infrastructure costs include large computer hardware and software expenses. Agency and Program overhead is the pro-rated share, attributable to a particular service, of the agency’s management and support costs. Management and administrative support costs include the costs of providing budget and accounting services, regulatory services, investigative and enforcement services, debt-management services, personnel services, public information services, legal services, statistical services, and other general program and agency management services of support activities above the VerDate Aug<31>2005 18:17 Sep 21, 2006 Jkt 208001 local laboratory level. Overhead expenditures are allocated across the Agency for each direct hour of laboratory service. AMS no longer uses the Billings and Collections System (BLCO) for billings and collections through the National Finance Center (NFC) in New Orleans, LA. The Agency now uses the ‘‘accounts receivable’’ functions in Foundation Financial Information System (FFIS) as the document feeder system for customer billings and the collections now come through our lockbox. Accordingly, § 91.42 would be updated to reflect these changes. The regulations also are updated to identify current facility addresses. This proposed rule would also remove and reserve 7 CFR part 92. Part 92 is obsolete because it relates to the mandatory testing of imported tobacco for prohibited pesticide residues and the statutory requirement for such testing has been removed by the Fair and Equitable Tobacco Reform Act of 2004 (7 U.S.C. 518). The tests had been conducted by Science and Technology (S&T) Programs for the AMS Tobacco Program, which sampled imported tobacco and administered the program for imported tobacco. Executive Order 12866, Regulatory Flexibility Act, and Paperwork Reduction Act This proposed rule has been reviewed under Executive Order 12866. Although not economically significant, this rule has been determined to be significant for the purposes of Executive Order 12866 and, therefore, has been reviewed by the Office of Management and Budget (OMB). An economic analysis follows to review the impacts on laboratory customers of the proposed revisions in AMS voluntary user fees for laboratory services. The economic analysis provides a cost-benefit analysis as required by Executive Order 12866 and an analysis of the potential economic effects on small entities as required by the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq.). In accordance with 5 U.S.C. 603, AMS has performed an Initial Regulatory Flexibility Analysis for this proposed rule. AMS is inviting comments about this proposed rule as it relates to small entities. In particular, AMS is interested in obtaining information concerning the number and kind of small entities who may incur benefits or costs from implementation of this proposed rule and the impact of those benefits or costs on decisions to utilize AMS voluntary testing services. Regulations must be designed in the most cost-effective manner possible to PO 00000 Frm 00022 Fmt 4702 Sfmt 4702 55375 obtain the objective of a sustainable cost recovery program while imposing the least burden on society. AMS has prepared a Regulatory Impact Assessment (RIA) consisting of a statement of the need for the proposed action, an examination of alternative approaches, and an economic analysis of the benefits and costs. Need for Proposed Action. The AMS laboratory testing programs are voluntary, user fee services conducted under the authority of the Agricultural Marketing Act of 1946 (AMA), as amended (7 U.S.C. 1621, et seq.). The AMA authorizes the Secretary of Agriculture to provide Federal analytical testing services that facilitate marketing and trade. The AMA also requires that reasonable fees be collected from the users of the services to cover as nearly as practicable the costs of maintaining the programs. Science and Technology (S&T) Programs of AMS regularly reviews its user-fee-financed laboratory service programs to determine if the fee levels are adequate. The most recent review determined that the existing fee schedule, effective October 27, 2000 (65 FR 64302) does not generate sufficient revenues to recover operating costs. For fiscal year 2005 the Science and Technology program reported a $702,000 deficit at the current fee levels. The Science and Technology program costs and revenues for fiscal year 2005 were $6,393,000 and $5,691,000, respectively. Program obligations for fiscal year 2006 are projected at $6,602,000 and revenues are projected at $5,834,000 for an estimated deficit of $768,000. With this proposed action, the Agency expects to collect an estimated $6,521,000, $7,186,000, and $7,553,000 in fiscal years 2007 through 2009 respectively, to cover the cost of routine laboratory services, appeal requests, overtime, and holiday services for Science and Technology customers and other program stakeholders. Alternatives Alternatives to the proposed rate increase were considered by the Agency. One alternative to this proposed rule would be to make no changes to the current user fees. As a result, AMS would not recover the full cost of program activities and services would have to be reduced or terminated. Were this to happen, the users of AMS laboratory services would be unable to meet certain AMS program requirements, would find it more difficult to meet foreign government or importer testing requirements, and would lose the opportunity to support E:\FR\FM\22SEP1.SGM 22SEP1 55376 Federal Register / Vol. 71, No. 184 / Friday, September 22, 2006 / Proposed Rules their marketing efforts with what they believe to be preferred government laboratory test results. Consequently, AMS does not consider this alternative to be reasonable. Another alternative considered would be to calculate the fee increases needed over the next three year period and then spread this overall increase evenly in annual increments. Because the increases are necessary to cover ongoing costs, e.g., rent, salaries and benefits, and equipment replacement, and financial stability needs to be maintained for this program, adequate funds must be generated immediately, rather than spread over a three year period. Thus, AMS does not consider this alternative to be reasonable. To ensure full costs are being covered as they are incurred, the preferred alternative is to match fee increases with expected costs on an annual basis over the next three years. This alternative will assure costs are appropriately covered and that laboratory testing services remain available as program customers request them. With this proposed action, the Agency expects to collect an estimated $6,521,000, $7,186,000, and $7,553,000 in fiscal years 2007 through 2009, respectively, to cover the cost of routine laboratory services, appeal requests, overtime, and holiday services. Summary of Impacts Under this proposal AMS would continue to offer laboratory testing services under the Agricultural Marketing Act of 1946 as amended, to facilitate marketing and allow products to obtain grade designations or meet marketing standards. As such, the program provides a viable option for a wide variety of clients by delivering scientific and analytical support services to the agricultural community and provides a valuable resource for those businesses and industries that wish to use a USDA shield. Further, by proposing a three year fee increase instead of a single year fee increase, the Agency would help ensure that the fee increases are effective at the beginning of each fiscal year on October 1. An increase over three fiscal years would permit customers and other program stakeholders an opportunity to plan for annual changes in costs of laboratory service and to incorporate them into their budgetary plans. For analytical purposes, projected collections are based on calculations using an effective date of October 1, 2006 for the proposed fiscal year 2007 user fees. There are essentially three rate increases being proposed for the basic laboratory services—$45 to $60 or 33.3 percent in fiscal year 2007, $60 to $63 or 5.0 percent in fiscal year 2008 and $63 to $67 or 6.4 percent in fiscal year 2009. The rate increases for overtime and appeals are $67.50 to $71 or 5.2 percent, $71 to $74 or 4.2 percent, and $74 to $78 or 5.4 percent in fiscal years 2007, 2008, and 2009, respectively. The rate increases for holiday service are $67.50 to $82 or 21.5 percent, $82 to $85 or 3.7 percent, and $85 to $89 or 4.7 percent in fiscal years 2007, 2008, and 2009, respectively. This is a voluntary program and the costs to each user would be proportional to their use of laboratory services each year. The increased fees will cover inflation and national and locality pay raises and replacement of equipment and other infrastructure improvements. Under the Regulatory Flexibility Act, the impact ofthis proposed rule on small businesses must be analyzed. There are 811 current users of AMS laboratory testing services. Such users of services include food processors, handlers, growers, Federal and State government agencies, and exporters. Many of these users are small entities under the criteria established by the Small Business Administration (13 CFR 121.201). Any decision by stakeholders and customers to discontinue the use of the laboratory services because of increased fees would not hinder food processors or other industry members from marketing their products. For the following cost analysis, certain assumptions are used. First, base year data is actual fiscal year 2005 amount billed for voluntary services performed for the public. Second, seven percent of the total amount billed represents overtime costs and five percent represents costs related to appeals. Third, the calculated amounts in fiscal year 2007 are using the base year data as if the base year was fiscal year 2006. Fourth, each of the 811 customers had the exact same tests, using the same amount of time, and thus were billed the exact same amount. This customer is the ‘‘average’’ laboratory customer. Table 14 sets the total levels for the dollar ($) amounts billed in the base year (Fiscal Year 2006). TABLE 14.—BASE YEAR DATA (FISCAL YEAR 2006) Total Billed ............................ Basic Laboratory Services .... Overtime Costs (7%) ............ Appeal Costs (5%) ............... $1,536,688 1,352,285 107,568 76,834 Table 15 presents the base year costs and estimates costs in fiscal year 2007, fiscal year 2008, and fiscal year 2009 for the ‘‘average’’ laboratory customer. The base year values are derived by dividing basic laboratory services, overtime costs, and appeal costs by 811. The values for fiscal years 2007, 2008, and 2009 are derived multiplying each year by the appropriate percentage rate. TABLE 15.—COSTS ($) FOR THE ‘‘AVERAGE’’ CUSTOMER, BASE YEAR THROUGH FISCAL YEAR 2009 Base year FY 2007 FY 2008 FY 2009 Total Diff.1 Lab Services ............................................................................................ Overtime .................................................................................................. Appeals .................................................................................................... 1,667 133 95 2,223 140 100 2,334 146 104 2,483 154 110 816 21 15 Total .................................................................................................. 1,895 2,463 2,584 2,747 852 jlentini on PROD1PC65 with PROPOSAL 1 Net difference calculated between costs in dollars ($) between base year and Fiscal Year 2009. After the third increase, the customer will pay an additional average of $852 for all laboratory services. This is a VerDate Aug<31>2005 18:17 Sep 21, 2006 Jkt 208001 44.96 percent increase over the base year. The percentage increase for the basic laboratory services is 49.0 percent, PO 00000 Frm 00023 Fmt 4702 Sfmt 4702 overtime is 15.8 percent, and an appeal sample is 15.8 percent. E:\FR\FM\22SEP1.SGM 22SEP1 Federal Register / Vol. 71, No. 184 / Friday, September 22, 2006 / Proposed Rules 55377 TABLE 16.—COSTS ($) FOR A ‘‘LARGE BUSINESS’’ CUSTOMER, BASE YEAR THROUGH FISCAL YEAR (FY) 2009 Base year FY 2007 FY 2008 FY 2009 Total diff.1 Lab Services ............................................................................................ Overtime .................................................................................................. Appeals .................................................................................................... 704,000 56,000 40,000 938,432 58,912 42,080 985,354 61,386 43,847 1,048,417 64,701 46,215 344,417 8,701 6,215 Total .................................................................................................. 800,000 1,039,424 1,090,587 1,159,333 359,333 1 Net difference calculated between costs in dollars ($) between base year and Fiscal Year 2009. Table 16 presents the base year costs and estimates costs in fiscal years 2007, 2008, and 2009 for a ‘‘large business’’ laboratory customer. While the numerical values increase significantly, the percentages are the same. Even though the ‘‘large business’’ customer is paying $359,333 more then what was paid for the same services in the base year, the increase is still approximately 44.9 percent above what was billed in the base year. The same is true for a ‘‘small business’’ customer. Table 17 presents the costs associated with a customer billed $29,000. Again the total difference between the billing in fiscal year 2009 and the base year is significantly smaller than the billing of an ‘‘average’’ customer, but the percentage increase is still near 44.9 percent. TABLE 17.—COSTS ($) FOR A ‘‘SMALL BUSINESS’’ CUSTOMER, BASE YEAR THROUGH FISCAL YEAR (FY) 2009 Base year FY 2007 FY 2008 FY 2009 Total diff.l Lab Services ............................................................................................ Overtime .................................................................................................. Appeals .................................................................................................... 25,520 2,030 1,450 34,018 2,136 1,525 35,719 2,226 1,589 38,005 2,346 1,675 12,485 316 225 Total .................................................................................................. 29,000 37,679 39,534 42,026 13,026 jlentini on PROD1PC65 with PROPOSAL 1 Net difference calculated between costs in dollars ($) between base year and FY 2009. Under the Regulatory Flexibility Act, the impact of this proposed rule on small businesses must be considered. The Agency estimates that 25 percent of the laboratory fees billed in fiscal year 2005 was to small businesses. Thus, a total of $384,172 was billed to small businesses. If the entire proposed fee increase had been implemented, small businesses would have been billed $556,665, a 44.9 percent increase. One question is how each of these customers including small businesses will react to cost increases at these amounts. The increases are spread over a three year period which will mitigate some of the impact. But the focus should be on the reaction to the increase occurring in fiscal year 2007 which is a one third increase over the base year. The answer is dependent on the customer’s business, and is proportional to the number of samples involved. The lower the cost per unit of product being sampled, the higher the probability the customer will continue to use AMS laboratory services and pass on some or all of the additional costs, the exact amount of which is not known. Also, use of AMS laboratory services is voluntary and other private or public laboratory options are available. This proposed rule contains no new information collection or recordkeeping requirements that are subject to the Office of Management and Budget VerDate Aug<31>2005 18:17 Sep 21, 2006 Jkt 208001 (OMB) approval under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501– 3520). AMS is committed to implementation of the Government Paperwork Elimination Act which provides for the use of information resources to improve the efficiency and effectiveness of governmental operations, including providing the public with the option of submitting information or transacting business electronically to the extent practicable. USDA has not identified any relevant Federal rules that duplicate, overlap, or conflict with this rule. alternatives and adopt the least costly, more cost-effective or least burdensome alternative that achieves the objectives of the rule. This rule contains no Federal mandates (under the regulatory provisions of Title II of the UMRA) that impose costs on State, local, or tribal governments or to the private sector of $100 million or more in anyone year. Thus, this rule is not subject to the requirements of sections 202 and 205 of UMRA. Unfunded Mandate Analysis Title II of the Unfunded Mandate Reform Act of 1995 (UMRA), Public Law 104–4, establishes requirements for Federal agencies to assess the effects of their regulatory actions on State, local, and tribal governments and the private sector. Under section 202 of UMRA, the Department generally must prepare a written statement, including a cost benefit analysis, for proposed and final rules with ‘‘Federal mandates’’ that may result in expenditures to State, local, or tribal governments, in the aggregate, or to the private sector, of $100 million or more in anyone year. When such a statement is needed for a rule, section 205 of UMRA generally requires that the Department identify and consider a reasonable number of regulatory This proposed rule has been reviewed under Executive Order 12988, Civil Justice Reform. It is not intended to have retroactive effect. This proposed rule would not preempt any State or local laws, regulation, or policies, unless they present an irreconcilable conflict with this rule. There are no administrative procedures which must be exhausted prior to any judicial challenge to this rule or the application of its provisions. PO 00000 Frm 00024 Fmt 4702 Sfmt 4702 Civil Justice Reform (Executive Order 12988) Civil Rights Review AMS has considered the potential civil rights implications of this rule on minorities, women, or persons with disabilities to ensure that no person or group shall be discriminated against on the basis of race, color, national origin, E:\FR\FM\22SEP1.SGM 22SEP1 55378 Federal Register / Vol. 71, No. 184 / Friday, September 22, 2006 / Proposed Rules gender, religion, age, disability, sexual orientation, marital or family status, political beliefs, parental status, or protected genetic information. AMS has included at § 91.7 the provision in the regulation under part 91 to describe in detail the requirements for nondiscrimination when reviewing or granting any person or entity the benefits of Science and Technology Programs laboratory service. This regulation is consistent with USDA regulations which prohibit discrimination in its programs and activities. This proposed rule would not require affected entities to relocate or alter their operations in ways that could adversely affect such persons or groups. Further, this proposed rule would not deny any persons or groups the benefits of the program or subject any persons or groups to discrimination. AMS has reviewed this proposed rule in accordance with the Department Regulation 4300–4, ‘‘Civil Rights Impact Analysis.’’ AMS has determined this proposed action ensures the civil rights of all Science and Technology Programs applicants and customers. They represent minorities (24.4%), women (51.1%), and persons with disabilities (14.5%) in the same percent proportions to the entire customer base as their compositions are represented in the total approximate general population (299 million) of the United States of America available in descriptive tables at https://www.census.gov/. In addition, each and every customer would receive the same user fee for each identical service. jlentini on PROD1PC65 with PROPOSAL Comments A thirty day comment period is provided for interested persons to comment on this proposed action. All comments received by October 23, 2006 will be considered. A thirty day period for public comment is justified in order to allow the agency to recover the full cost of operating a voluntary user fee laboratory testing program. The existing fee schedules have been in place since October 2000. AMS regularly reviews its user-fee-supported programs to determine if the voluntary fees are adequate to cover expenses. Due to the length of the rulemaking process, the fiscal year has partially elapsed by the time the agency publishes a final rule to amend its fees. As a result the agency is unable to recover the full cost of its services in a timely manner. Therefore, a thirty day comment period is reasonable. VerDate Aug<31>2005 19:43 Sep 21, 2006 Jkt 208001 List of Subiects 7 CFR Part 91 Administrative practice and procedure, Agricultural commodities, Laboratories, Reporting and recordkeeping requirements. 7 CFR Part 92 Agricultural commodities, Laboratories, Pesticides and pests, Tobacco. Under the authority of 7 U.S.C. 1622 and 1624, the Agricultural Marketing Service proposes to amend parts 91 and 92 of Title 7, chapter I, subchapter E, of the Code of Federal Regulations as follows: PART 91—SERVICES AND GENERAL INFORMATION [AMENDED] 1. The authority citation for part 91 continues to read as follows: Authority: 7 U.S.C. 1622, 1624. 2. Section 91.5 is revised to read as follows: § 91.5 Where services are offered. (a) Services are offered to applicants at the Science and Technology laboratories and facilities as listed below. (1) Science and Technology Programs National Science Laboratory. A variety of proximate, chemical, microbiological and biomolecular tests and laboratory analyses performed on fruits and vegetables, poultry, meat and meat products, fiber products and processed foods are performed at the Science and Technology Programs (S&T) laboratory located at: USDA, AMS, Science and Technology Programs, National Science Laboratory (NSL), 801 Summit Crossing Place, Suite B, Gastonia, North Carolina 28054–2193. (2) Science and Technology (S&T) Programs Science Satellite Laboratories. The specialty satellite laboratories performing aflatoxin and other testing on peanuts, peanut products, dried fruits, grains, edible seeds, tree nuts, shelled corn products, oilseed products, vegetable oils, juices, citrus products, and other commodities are located as follows: (i) USDA, AMS, Science & Technology, Citrus Laboratory, 98 Third Street, SW., Winter Haven, Florida 33880–2905. (ii) USDA, AMS, Science & Technology, 6567 Chancey Mill Road, Blakley, Georgia 39823–2785. (iii) USDA, AMS, Science & Technology, c/o Golden Peanut Company LLC, (Mail: P.O. Box 272), 715 Martin Luther King Drive, Dawson, Georgia 39842–1002. PO 00000 Frm 00025 Fmt 4702 Sfmt 4702 (iv) USDA, AMS, Science & Technology, 107 South Fourth Street, Madill, Oklahoma 73446–3431. (v) USDA, AMS, Science & Technology, (Mail: P.O. Box 1130), 308 Culloden Street, Suffolk, VA 23434– 4706. (3) Program laboratories. Laboratory services are available in all areas covered by cooperative agreements providing for this laboratory work and entered on behalf of the Department with cooperating Federal or State laboratory agencies pursuant to authority contained in Act(s) of Congress. Also, services may be provided in other areas not covered by a cooperative agreement if the Administrator determines that it is possible to provide such laboratory services. (4) Other alternative laboratories. Laboratory analyses may be conducted at alternative Science and Technology Programs laboratories and can be reached from any commodity market in which a laboratory facility is located to the extent laboratory personnel are available. (5) The Plant Variety Protection (PVP) Office. The PVP office and plant examination facility of the Science and Technology programs issues certificates of protection to developers of novel varieties of plants which reproduce sexually. The PVP office is located as follows: USDA, AMS, Science & Technology Programs, Plant Variety Protection Office, National Agricultural Library Building, Room 401, 10301 Baltimore Boulevard, Beltsville, MD 20705–2351. (6) Science and Technology Programs headquarters offices. The examination, licensure, quality assurance reviews, laboratory approval/certification and consultation services are provided by headquarters staff located in Washington, DC. The main headquarters office is located as follow: USDA, AMS, Science and Technology Programs, Office of the Deputy Administrator, South Agriculture Bldg., Mail Stop 0270, 1400 Independence Ave., SW., Washington, DC 20250–0270. (7) The Information Technology (IT) Group. The IT office of the Science and Technology Programs is headed by the Associate Deputy Administrator for Technology/Chief Information Officer and provides information technology services and management systems to the Agency and other agencies within the USDA. The main IT office is located as follows: USDA, AMS, Science and Technology, Office of the Associate Deputy Administrator for Technology, 1752 South Agriculture Bldg., Mail Stop E:\FR\FM\22SEP1.SGM 22SEP1 jlentini on PROD1PC65 with PROPOSAL Federal Register / Vol. 71, No. 184 / Friday, September 22, 2006 / Proposed Rules 0204, 1400 Independence Ave., SW., Washington, DC 20250–0204. (8) Statistics Branch Office. The Statistics Branch office of Science and Technology Programs (S&T) provides statistical services to the Agency and other agencies within the USDA. In addition, the Statistics Branch office generates sample plans and performs consulting services for research studies in joint efforts with or in a leading role with other program areas of AMS or of the USDA. The Statistics Branch office is located as follows: USDA, AMS, S&T Statistics Branch, 0603 South Agriculture Bldg., Mail Stop 0223, 1400 Independence Ave., SW., Washington, DC 20250–0223. (9) Technical Services Branch Office. The Technical Services Branch office of Science and Technology (S&T) provides technical support services to all Agency programs and other agencies within the USDA. In addition, the Technical Services Branch office provides certification and approval services of private and State government laboratories as well as oversees quality assurance programs; import and export certification of laboratory tested commodities. The Technical Services Branch mailing address is as follows: USDA, AMS, S&T Technical Services Branch, South Agriculture Bldg., Mail Stop 0272, 1400 Independence Ave., SW., Washington, DC 20250–0272. The Technical Services Branch office is located as follows: USDA, AMS, Science and Technology Technical Services Branch, Room 306, Cotton Annex Bldg., 300 12th Street, SW., Washington, DC 20250. (10) Monitoring Programs Office. Services afforded by the Pesticide Data Program (PDP) and Microbiological Data Program (MDP) are provided by USDA, AMS, Science and Technology Monitoring Programs Office, 8609 Sudley Road, Suite 206, Manassas, VA 20110–8411. (11) Pesticide Records Branch Office. Services afforded by the Federal Pesticide Record Keeping Program for restricted-use pesticides by private certified applicators are provided by USDA, AMS, Science and Technology, Pesticide Records Branch, 8609 Sudley Road, Suite 203, Manassas, VA 20110– 8411. (b) The addresses of the various laboratories and offices appear in the pertinent parts of this subchapter. A prospective applicant may obtain a current listing of addresses and telephone numbers of Science and Technology Programs laboratories, offices, and facilities by addressing an inquiry to the Administrative Officer, Science and Technology Programs, VerDate Aug<31>2005 18:17 Sep 21, 2006 Jkt 208001 Agricultural Marketing Service, United States Department of Agriculture (USDA), 1400 Independence Ave., SW., Room 0725, South Agriculture Building, Mail Stop 0271, Washington, DC 20250– 0271. 3. Sections 91.37 through 91.39 are revised to read as follows: § 91.37 Standard hourly fee rate for laboratory testing, analysis, and other services. (a) The standard hourly fee rate in this section for the individual laboratory analyses cover the costs of Science and Technology laboratory services, including issuance of certificates and personnel and overhead costs other than the commodity inspection fees referred to in 7 CFR 52.42 through 52.46, 52.48 through 52.51, 55.510 through 55.530, 55.560 through 55.570, 58.38 through 58.43, 58.45 through 58.46, 70.71 through 70.72, and 70.75 through 70.78. The hourly fee rates in this part 91 apply to all commodity and processed commodity products. The new fiscal year for Science and Technology Programs commences on October 1 of each calendar year. The rate for laboratory services is $60.00 per hour in fiscal year 2007, $63.00 per hour in fiscal year 2008, and $67.00 per hour in fiscal year 2009. (b) Printed updated schedules of the laboratory testing fees for processed fruits and vegetables (7 CFR part 93), poultry and egg products (7 CFR part 94), and meat and meat products (7 CFR part 98) will be available for distribution to Science and Technology’s constituents and stakeholders by the individual Laboratory Managers of Science and Technology laboratories listed in § 91.5. These single test laboratory fee schedules are based upon the applicable hourly fee rate stated in § 91.37(a). (c) Except as otherwise provided in this section, charges will be made at the applicable hourly rate stated in § 91.37(a) for the time required to perform the service. A charge will be made for service pursuant to each request or certificate issued. (d) When a laboratory test service is provided for AMS by a commercial or State government laboratory, the applicant will be assessed a fee which covers the costs to the Science and Technology program for the service provided. (e) When Science and Technology staff provides applied and developmental research and training activities for microbiological, physical, chemical, and biomolecular analyses on agricultural commodities the applicant PO 00000 Frm 00026 Fmt 4702 Sfmt 4702 55379 will be charged a fee on a reimbursable cost to AMS basis. § 91.38 Additional fees for appeal of analysis. (a) The applicant for appeal sample testing will be charged a fee at the hourly rate for laboratory service that appears in this paragraph. The new fiscal year for Science and Technology Programs commences on October 1 of each calendar year. The appeal rate for laboratory service is $71.00 per hour in fiscal year 2007, $74.00 per hour in fiscal year 2008, and $78.00 per hour in fiscal year 2009. (b) The appeal fee will not be waived for any reason if analytical testing was completed in addition to the original analysis. § 91.39 Premium hourly fee rates for overtime and legal holiday service. (a) When analytical testing in a Science and Technology facility requires the services of laboratory personnel beyond their regularly assigned tour of duty on any day or on a day outside the established schedule, such services are considered as overtime work. When analytical testing in a Science and Technology facility requires the services of laboratory personnel on a Federal holiday or a day designated in lieu of such a holiday, such services are considered holiday work. Laboratory analyses initiated at the request of the applicant to be rendered on Federal holidays, and on an overtime basis will be charged fees at hourly rates for laboratory service that appear in this paragraph. The new fiscal year for Science and Technology Programs commences on October 1 of each calendar year. The laboratory analysis rate for overtime service is $71.00 per hour in fiscal year 2007, $74.00 per hour in fiscal year 2008, and $78.00 per hour in fiscal year 2009. The laboratory analysis rate for Federal holiday or designed holiday service is $82.00 per hour in fiscal year 2007, $85.00 per hour in fiscal year 2008, and $89.00 per hour in fiscal year 2009. (b) Information on legal holidays or what constitutes overtime service at a particular Science and Technology laboratory is available from the Laboratory Manager or facility supervisor. 4. Section 91.42 is revised to read as follows: § 91.42 Billing. (a) Each billing cycle will end on the 25th of the month. The applicant will be billed by the National Finance Center (NFC) using the Foundation Financial Information System (FFIS) on the 1st E:\FR\FM\22SEP1.SGM 22SEP1 55380 Federal Register / Vol. 71, No. 184 / Friday, September 22, 2006 / Proposed Rules day, following the end of the billing cycle in which voluntary laboratory services and other services were rendered at a particular Science and Technology laboratory or office. (b) The total charge or fee shall normally be stated directly on the analysis report or on a standardized official certificate form for the laboratory analysis of a specific agricultural commodity and related commodity products. (c) The actual bill for collection will be issued by the USDA, National Finance Center Billings and Collection Branch, (Mail: P.O. Box 60075), 13800 Old Gentilly Road, New Orleans, Louisiana 70160–0001. PART 92—[REMOVED AND RESERVED] 5. Part 92 is removed in its entirety and reserved. Dated: September 14, 2006. Lloyd C. Day, Administrator, Agricultural Marketing Service. [FR Doc. 06–7821 Filed 9–21–06; 8:45 am] BILLING CODE 3410–02–M DEPARTMENT OF AGRICULTURE Agricultural Marketing Service 7 CFR Part 993 [Docket No. FV06–993–1 PR] Dried Prunes Produced in California; Decreased Assessment Rate Agricultural Marketing Service, USDA. ACTION: Proposed rule. jlentini on PROD1PC65 with PROPOSAL AGENCY: SUMMARY: This rule would decrease the assessment rate established for the Prune Marketing Committee (committee) under Marketing Order No. 993 for the 2006–07 and subsequent crop years from $0.65 to $0.40 per ton of salable dried prunes. The committee locally administers the marketing order which regulates the handling of dried prunes grown in California. Assessments upon dried prune handlers are used by the committee to fund reasonable and necessary expenses of the program. The crop year began August 1 and ends July 31. The assessment rate would remain in effect indefinitely unless modified, suspended, or terminated. DATES: Comments must be received by October 23, 2006. ADDRESSES: Interested persons are invited to submit written comments concerning this rule. Comments must be VerDate Aug<31>2005 18:17 Sep 21, 2006 Jkt 208001 sent to the Docket Clerk, Marketing Order Administration Branch, Fruit and Vegetable Programs, AMS, USDA, 1400 Independence Avenue, SW., STOP 0237, Washington, DC 20250–0237; Fax: (202) 720–8938; or E-mail: moab.docketclerk@usda.gov, or Internet: https://www.regulations.gov. Comments should reference the docket number and the date and page number of this issue of the Federal Register and will be available for public inspection in the Office of the Docket Clerk during regular business hours, or can be viewed at: https://www.ams.usda.gov/fv/moab.html. FOR FURTHER INFORMATION CONTACT: Toni Sasselli, Program Analyst, or Terry Vawter, Marketing Specialist, California Marketing Field Office, Fruit and Vegetable Programs, AMS, USDA; Telephone: (559) 487–5901; Fax (559) 487–5906, or E-mail: Toni.Sasselli@usda.gov or Terry.Vawter@usda.gov. Small businesses may request information on complying with this regulation by contacting Jay Guerber, Marketing Order Administration Branch, Fruit and Vegetable Programs, AMS, USDA, 1400 Independence Avenue, SW., STOP 0237, Washington, DC 20250–0237; Telephone: (202) 720– 2491, Fax: (202) 720–8938, or E-mail: Jay.Guerber@usda.gov. SUPPLEMENTARY INFORMATION: This rule is issued under Marketing Agreement No. 110 and Marketing Order No. 993, both as amended (7 CFR part 993), regulating the handling of dried prunes grown in California, hereinafter referred to as the ‘‘order.’’ The marketing agreement and order are effective under the Agricultural Marketing Agreement Act of 1937, as amended (7 U.S.C. 601– 674), hereinafter referred to as the ‘‘Act.’’ The Department of Agriculture (USDA) is issuing this rule in conformance with Executive Order 12866. This rule has been reviewed under Executive Order 12988, Civil Justice Reform. Under the marketing order now in effect, California dried prune handlers are subject to assessments. Funds to administer the order are derived from such assessments. It is intended that the assessment rate as proposed herein would be applicable to all assessable dried prunes beginning August 1, 2006, and continue until amended, suspended, or terminated. This rule will not preempt any State or local laws, regulations, or policies, unless they present an irreconcilable conflict with this rule. The Act provides that administrative proceedings must be exhausted before PO 00000 Frm 00027 Fmt 4702 Sfmt 4702 parties may file suit in court. Under section 608c(15)(A) of the Act, any handler subject to an order may file with USDA a petition stating that the order, any provision of the order, or any obligation imposed in connection with the order is not in accordance with law and request a modification of the order or to be exempted therefrom. Such handler is afforded the opportunity for a hearing on the petition. After the hearing USDA would rule on the petition. The Act provides that the district court of the United States in any district in which the handler is an inhabitant, or has his or her principal place of business, has jurisdiction to review USDA’s ruling on the petition, provided an action is filed not later than 20 days after the date of the entry of the ruling. This rule would decrease the assessment rate established for the committee for the 2006–07 and subsequent crop years from $0.65 to $0.40 per ton of salable dried prunes handled. The California dried prune marketing order provides authority for the committee, with the approval of USDA, to formulate an annual budget of expenses and collect assessments from handlers to administer the program. The members of the committee are producers and handlers of California dried prunes. They are familiar with the committee’s needs and with the costs for goods and services in their local area; and are, thus, in a position to formulate an appropriate budget and assessment rate. The assessment rate is formulated and discussed in at least one public meeting. Thus, all directly affected persons have an opportunity to participate and provide input. For the 2005–06 and subsequent crop years, the committee recommended, and USDA approved, an assessment rate that would continue in effect from crop year to crop year unless modified, suspended, or terminated by USDA upon recommendation and information submitted by the committee or other information available to USDA. The committee met on June 29, 2006, and unanimously recommended a decreased assessment rate of $0.40 per ton of salable dried prunes and expenditures totaling $77,215 for the 2006–07 crop year. In comparison, last year’s approved expenses were $89,090. The proposed assessment rate of $0.40 per ton of salable dried prunes is $0.25 lower than the rate currently in effect. The committee recommended a lower assessment rate based on an estimated production of 145,000 tons of salable dried prunes. At the proposed assessment rate, the assessment income E:\FR\FM\22SEP1.SGM 22SEP1

Agencies

[Federal Register Volume 71, Number 184 (Friday, September 22, 2006)]
[Proposed Rules]
[Pages 55369-55380]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 06-7821]


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

DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Parts 91 and 92

[Docket Number ST-05-01]
RIN 0581-AC48


Changes in Hourly Fee Rates for Science and Technology Laboratory 
Services--Fiscal Years 2007-2009

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Proposed rule with request for comments.

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

SUMMARY: The Agricultural Marketing Service (AMS) is proposing to 
change the hourly fee rates for Science and Technology (S&T) Laboratory 
Services. The agency is proposing to raise these rates to reflect, 
among other factors, national and locality pay increases for Federal 
employees and inflation, operating costs, instrumentation and training, 
and program and agency administrative overhead costs. In the past, AMS 
has amended its regulations on an as needed basis in order to recover 
laboratory program costs. With this proposed regulation, AMS is 
providing for three annual standard hourly fee rate increases for 
fiscal years 2007-2009. This would provide the agricultural commodity 
industries and other stakeholders with more timely and relevant 
information regarding voluntary user fees for laboratory testing 
services. The agency is also proposing to remove tables and schedules 
with listings of individual tests and services. Three annual hourly fee 
rate adjustments are proposed for appeals, holiday, and overtime 
services to reflect the anticipated increase in cost of providing these 
laboratory services each fiscal year. The regulations also are updated 
to identify current facility addresses. Part 92 is obsolete and 
therefore has been removed.

DATES: Comments must be received on or before October 23, 2006.

ADDRESSES: Send comments to James V. Falk, Docket Manager, USDA, AMS, 
Science and Technology Programs, 1400 Independence Avenue, SW., Mail 
Stop 0272, Washington, DC 20250-0272; telephone (202) 690-4089; fax 
(202) 720-4631, or e-mail: James.falk@usda.gov. State that your 
comments refer to Docket No. ST-05-01. Comments may also be submitted 
electronically through https://www.regulations.gov. Submitted comments 
will be available for public inspection during regular business hours 
in Room 1090 South Building, U.S. Department of Agriculture, 1400 
Independence Avenue, SW., Washington, DC.

FOR FURTHER INFORMATION CONTACT: Dr. Robert L. Epstein, Science and 
Technology Programs, Agricultural Marketing Service, United States 
Department of Agriculture, Mail Stop 0270, 1400 Independence Avenue, 
SW., Washington, DC 20250-0270, telephone number (202) 720-5231; fax 
(202) 720-6496, and e-mail: Robert.epstein@usda.gov.

SUPPLEMENTARY INFORMATION: 

Background

    Science and Technology (S&T) Programs has been performing voluntary 
laboratory services under the Agricultural Marketing Act of 1946, as 
amended, for the AMS commodity programs (Fruit and Vegetable, Cotton, 
Livestock and Seed, Poultry, Dairy, and Tobacco) and applicable 
customers in these industries since its inception on August 17, 1988. 
Before that, voluntary laboratory testing was provided for a user fee 
by AMS under the various commodity programs. The current standard 
hourly rate of $45.00 and the premium hourly rate of $67.50 have been 
in effect since publication in the Federal Register on October 27, 2000 
(65 FR 64302). The standard fee rate for laboratory services is 
proposed to be increased to $60.00 per hour in fiscal year 2007, $63.00 
per hour in fiscal year 2008, and $67.00 per hour in fiscal year 2009. 
The premium hourly fee rates would also be adjusted for fiscal years 
2007 through 2009. An increase in the premium hourly rates over the 
three fiscal years for laboratory services performed on holidays, 
appeal samples, and overtime basis is also needed since Science and 
Technology laboratory personnel may be required to work extended hours 
of service at the time and a half pay or the double hourly pay to 
accommodate clients. This is due to

[[Page 55370]]

stakeholder demand for immediate test results. Generally, the 
processing of all laboratory samples is continuous over a 24/7 
timeframe due to the recent introduction of automated equipment.
    The AMS laboratory testing programs are voluntary, user fee 
services, conducted under the authority of the Agricultural Marketing 
Act of 1946 (AMA), as amended (7 U.S.C. 1621, et seq.). The AMA 
authorizes the Secretary of Agriculture to provide Federal analytical 
testing services that facilitate marketing and trade. In addition, 
consumers may be able to determine the quality and wholesomeness 
characteristics of a commodity or product through laboratory testing. 
This allows agricultural products to be assigned official AMS grade 
designations or to meet specifications. The AMA also requires that 
reasonable fees be collected from the users of the services to cover as 
nearly as possible the costs of maintaining the programs.
    AMS regularly reviews its user-fee-supported laboratory service 
programs to determine if the voluntary fees are adequate to cover 
expenses. The most recent review determined that the existing fee 
schedules and tables of individual tests or services, which have been 
in place since October 27, 2000, will not generate sufficient revenues 
to recover operating costs.
    A more flexible user fee system, using set hourly rates for 
multiple fiscal years, is proposed by this rulemaking to ensure that 
AMS properly recovers its full costs for providing laboratory services, 
and that all stakeholders are charged reasonable fees. By enacting a 
three year fee increase instead of a single year fee increase, AMS 
would help ensure that the fee increases are effective at the beginning 
of each fiscal year (October 1).
    In addition, the existing fee schedules and tables in 7 CFR, part 
91, Sec.  91.37 would be removed. The analytical tests listed in the 
tables are not specific to individual commodity testing requirements or 
stakeholder needs. The current tables do not represent the actual 
operational costs to perform single tests and newer methodologies. 
Laboratory services are provided for five types of analytical testing: 
Microbiological, physical, residue chemistry, proximate analysis for 
composition, and biomolecular testing. AMS must recover the costs of 
providing these services. The proposed hourly fee rates would recover 
these costs.
    AMS calculated its actual costs for fiscal years 2001 through 2005 
and its projected increases in salaries and inflation in fiscal years 
2006 through 2009. The estimates for increases in salaries for fiscal 
year 2006 as the base year and the succeeding out years are from the 
Office of Management and Budget's (OMB) multi-year ``Economic 
Assumptions'' tables. The Federal pay raise for calendar years 2002, 
2003, and 2004 were 4.6 percent, 4.1 percent and 4.1 percent, 
respectively. This information comes from Table 11-1, ``Economic 
Assumptions'', of the Office of Management and Budget's Fiscal Year 
2005 Budget which is available at https://www.whitehouse.gov/omb/budget/
fy2005/econ.html. The average fiscal year pay raise for Federal 
employees in calendar years 2005 and 2006 was 3.5 percent effective 
January 2005 and 3.1 percent effective January 2006. The average 
combined national and locality pay raise is estimated to be 2.2 percent 
for fiscal years 2007, 2008, and 2009. Inflation for fiscal year 2006 
is estimated to be 2.1 percent. Inflation for fiscal year 2007 is 
estimated to be 2.2 percent. Inflation for fiscal year 2008 is 
estimated to be 2.1 percent. Inflation for fiscal year 2009 is 
estimated to be 2.1 percent. These estimates for inflation percent can 
be obtained from Table 12-1, ``Economic Assumptions'', of the OMB's 
Fiscal Year 2007 Budget which is available at https://
www.whitehouse.gov/omb/budget/fy2007/econ.html.
    The Agency will initiate another rulemaking to adjust any fee 
established, if estimated increases for pay and inflation do not 
adequately cover the Agency's costs of providing the services. The cost 
of providing laboratory services includes both direct and overhead 
costs. Direct costs include the cost of salaries, employee benefits, 
operation cost and infrastructure cost. The Agency is able to estimate 
the employee benefits attributable to overtime work and has included 
these in the fee calculations.

                  Table 1.--Current and Proposed Hourly Fee Rates (Per Hour) by Type of Service
----------------------------------------------------------------------------------------------------------------
                                                                Current      FY 2007      FY 2008      FY 2009
                           Service                                rate       rate \1\     rate \2\     rate \3\
----------------------------------------------------------------------------------------------------------------
Laboratory..................................................      $ 45.00      $ 60.00      $ 63.00      $ 67.00
Appeal......................................................        67.50        71.00        74.00        78.00
Overtime....................................................        67.50        71.00        74.00        78.00
Legal Holiday...............................................        67.50        82.00        85.00       89.00
----------------------------------------------------------------------------------------------------------------
1 2 3 Hourly values for FY 2007-FY 2009 are rounded off to nearest whole dollar.

    With this proposed action, the AMS would amend its regulations to 
provide for three annual fee increases in one action. Table 1 shows the 
summary of the current rates and the proposed hourly fee rates for 
fiscal years 2007 through 2009 for the four different types of services 
(regular laboratory, appeal, overtime, and legal holiday work) that 
Science and Technology Programs employees perform.

   Table 2.--Calculations for the Standard Hourly Rate for Laboratory
                      Program Services for FY 2006
------------------------------------------------------------------------
                                                            Apportioned
                   Laboratory services                       fee rate
------------------------------------------------------------------------
Base Time:
    Actual FY 2005 Salaries \1\ @ $2,787,474............          $20.00
    FY 2006 Pay Adjustment \2\ = [Actual FY 2005                    1.48
     Salaries ($20.00)] x 0.031 + $0.86 (weighted
     portion @ $119,500 increase for the FY 2006 period
     changes with payroll for within-grade pay step
     increases for General Schedule salaries, promotion
     pay costs and new employee position pay costs).....
    Benefits \3\........................................            6.90
    Operational Costs \4\...............................           11.60
    Infrastructure Costs \5\............................            8.78

[[Page 55371]]

 
    Program Overhead \6\................................            3.44
    Agency Overhead \7\.................................            3.28
    FY 2006 Inflation (2.1 %) = [Costs excluding                    0.53
     infrastructure and payroll] x .021.................
                                                         ---------------
        Total Rate Per Hour--Base Time..................          56.01
------------------------------------------------------------------------
\1\ Actual cost of FY 2005 salaries ($2,787,474) / (2,080 program hours
  times 67 program employees) = $20.00 unit cost.
\2\ Actual cost of FY 2006 pay adjustment ($205,911) / (2,080 program
  hours times 67 program employees) = $1.48 unit cost.
\3\ Actual cost of benefits ($961,668) / (2,080 program hours times 67
  program employees) = $6.90 unit cost.
\4\ Actual cost of operational costs ($1,616,645) / (2,080 program hours
  times 67 program employees) = $11.60 unit cost.
\5\ Actual cost of infrastructure ($1,223,570) / (2,080 program hours
  times 67 program employees) = $8.78 unit cost.
\6\ Actual cost of Program overhead ($479,000) / (2,080 program hours
  times 67 program employees) = $3.44 unit cost.
\7\ Actual cost of Agency overhead ($457,000) / (2,080 program hours
  times 67 program employees) = $3.28 unit cost.


   Table 3.--Calculations for the Standard Hourly Rate for Laboratory
                      Program Services for FY 2007
------------------------------------------------------------------------
                                                            Apportioned
                   Laboratory services                       fee rate
------------------------------------------------------------------------
Base Time:
    FY 2006 Salaries = Actual FY 2005 Salaries ($20.00)           $21.48
     + FY 2006 Pay Adjustment ($1.48)...................
    FY 2007 Pay Adjustment = FY 2006 Salaries x 0.022...            0.47
    Benefits............................................            6.90
    Operational Costs...................................           11.60
    Infrastructure Cost.................................           11.75
    Program Overhead....................................            3.44
    Agency Overhead.....................................            3.28
    FY 2006 Inflation (2.1%) = [Costs excluding                     0.53
     infrastructure and payroll] x .021.................
    FY 2007 Inflation (2.2%) = [Costs excluding                     0.57
     infrastructure and payroll] x 022..................
                                                         ---------------
        Total Rate Per Hour--Base Time..................           60.02
------------------------------------------------------------------------


   Table 4.--Calculations for the Standard Hourly Rate for Laboratory
                      Program Services for FY 2008
------------------------------------------------------------------------
                                                            Apportioned
                   Laboratory services                       fee rate
------------------------------------------------------------------------
Base Time:
    FY 2007 Salaries = FY 2006 Salaries ($21.48) + FY             $21.95
     2007 Pay Adjustment ($0.47)........................
    FY 2008 Pay Adjustment = FY 2007 Salaries x 0.022...            0.48
    Benefits............................................            6.90
    Operational Costs...................................           11.60
    Infrastructure Cost.................................           13.47
    Program Overhead....................................            3.44
    Agency Overhead.....................................            3.28
    FY 2006 Inflation (2.1%) = [Costs excluding                     0.53
     infrastructure and payroll] x .021.................
    FY 2007 Inflation (2.2%) = [Costs excluding                     0.57
     infrastructure and payroll] x .022.................
    FY 2008 Inflation (2.1%) = [Costs excluding                     0.55
     infrastructure and payroll] x .021.................
                                                         ---------------
        Total Rate Per Hour--Base Time..................           62.77
------------------------------------------------------------------------


   Table 5.--Calculations for the Standard Hourly Rate for Laboratory
                      Program Services for FY 2009
------------------------------------------------------------------------
                                                            Apportioned
                   Laboratory services                       fee rate
------------------------------------------------------------------------
Base Time:
    FY 2008 Salaries = FY 2007 Salaries ($21.95) + FY             $22.43
     2008 Pay Adjustment ($0.48)........................
    FY 2009 Pay Adjustment = FY 2008 Salaries x 0.022...            0.49
    Benefits............................................            6.90
    Operational Costs...................................           11.60
    Infrastructure Cost.................................           16.15
    Program Overhead....................................            3.44
    Agency Overhead.....................................            3.28
    FY 2006 Inflation (2.1%) = [Costs excluding                     0.53
     infrastructure and payroll] x .021.................
    FY 2007 Inflation (2.2%) = [Costs excluding                     0.57
     infrastructure and payroll] x .022.................
    FY 2008 Inflation (2.1%) = [Costs excluding                     0.55
     infrastructure and payroll] x .021.................
    FY 2009 Inflation (2.1%) = [Costs excluding                     0.56
     infrastructure and payroll] x .021.................
                                                         ---------------

[[Page 55372]]

 
        Total Rate Per Hour--Base Time..................           66.50
------------------------------------------------------------------------

    In order to project the hourly fee rates for the laboratory program 
services for fiscal years 2007 through 2009, the current fiscal year 
2006 is used as a base. The total base time hourly fee rate calculation 
(Table 2) for fiscal year 2006 begins with the actual salaries for 
fiscal year 2005 ($2,787,474) and adds the fiscal year 2006 pay raises 
(3.1 percent) and add other fiscal year 2006 pay adjustments ($119,500) 
for within-grade pay step increases for General Schedule (GS) salaries, 
promotion pay costs, and new employee position pay costs. Table 2 
contains footnotes 1-7 that provide the common mathematical formula 
used to calculate the apportioned rate for each fee charge category for 
fiscal year 2006. The formula uses the actual cost or projected cost in 
dollars for the applicable fiscal year for each individual fee charge 
category divided by the available program hours and further divided by 
the number of laboratory service program employees. The formula derives 
the apportioned fee rate for each fee charge category (salaries with 
pay adjustment, benefits, operational costs, infrastructure cost, 
program administrative overhead and agency overhead). The same formula 
that is used in Table 2 and that is indicated in its footnotes is also 
applied in the other tables to derive each category unit rate with the 
different actual costs or variable projected costs to be inserted in 
the formula equation for the applicable fiscal year.
    Table 3 through Table 5 show the calculation of the total standard 
hourly fee rates to be rounded off for fiscal years 2007 through 2009.

   Table 6.--Calculations for the Appeal and Overtime Hourly Rates for
                 Laboratory Program Services for FY 2006
------------------------------------------------------------------------
                                                            Apportioned
                   Laboratory services                       fee rate
------------------------------------------------------------------------
Appeal and Overtime Rates: Actual Salaries @ 1.5 (time
 and a half):
    FY 2005 Salaries @ 1.5 = [Actual 2005 Salaries                $30.00
     ($20.00)] x 1.5....................................
    FY 2006 Pay Adjustment = [Actual FY 2005 Salaries               2.22
     ($20.00) x 0.031 + $0.86 (weighted portion @
     $119,500 increase for the FY 2006 period changes
     with payroll for within-grade pay step increases
     for General Schedule salaries, promotion pay costs,
     and new employee position pay costs)] x 1.5........
    Benefits............................................            6.90
    Operational Costs...................................           11.60
    Infrastructure Cost.................................            8.78
    Program Overhead....................................            3.44
    Agency Overhead.....................................            3.28
    FY 2006 Inflation (2.1%) = [Costs excluding                     0.53
     infrastructure and payroll] x .021.................
                                                         ---------------
        Total Rate Per Hour--Appeal and Overtime........           66.75
------------------------------------------------------------------------


   Table 7.--Calculations for the Appeal and Overtime Hourly Rates for
                 Laboratory Program Services for FY 2007
------------------------------------------------------------------------
                                                            Apportioned
                   Laboratory services                       fee rate
------------------------------------------------------------------------
Appeal and Overtime Rates: Actual Salaries @ 1.5 (time
 and a half):
    FY 2006 Salaries @ 1.5 = [Actual 2005 Salaries                $32.22
     ($20.00) + 2006 Pay Adjustment ($1.48)] x 1.5......
    FY 2007 Pay Adjustment = FY 2006 Salaries @ 1.5 x               0.71
     0.022..............................................
    Benefits............................................            6.90
    Operational Costs...................................           11.60
    Infrastructure Cost.................................           11.75
    Program Overhead....................................            3.44
    Agency Overhead.....................................            3.28
    FY 2006 Inflation (2.1%) = [Costs excluding                     0.53
     infrastructure and payroll] x .021.................
    FY 2007 Inflation (2.2%) = [Costs excluding                     0.57
     infrastructure and payroll] x .022.................
                                                         ---------------
        Total Rate Per Hour--Appeal and Overtime........           71.00
------------------------------------------------------------------------


   Table 8.--Calculations for the Appeal and Overtime Hourly Rates for
                 Laboratory Program Services for FY 2008
------------------------------------------------------------------------
                                                            Apportioned
                   Laboratory services                       fee rate
------------------------------------------------------------------------
Appeal and Overtime Rates: Actual Salaries @ 1.5 (time
 and a half):
    FY 2007 Salaries @ 1.5 = [FY 2006 Salaries ($21.48)           $32.93
     + FY 2007 Pay Adjustment ($0.47)] x 1.5............

[[Page 55373]]

 
    FY 2008 Pay Adjustment = FY 2007 Salaries @ 1.5 x               0.72
     0.022..............................................
    Benefits............................................            6.90
    Operational Costs...................................           11.60
    Infrastructure Cost.................................           13.47
    Program Overhead....................................            3.44
    Agency Overhead.....................................            3.28
    FY 2006 Inflation (2.1%) = [Costs excluding                     0.53
     infrastructure and payroll] x .021.................
    FY 2007 Inflation (2.2%) = [Costs excluding                     0.57
     infrastructure and payroll] x .022.................
    FY 2008 Inflation (2.1%) = [Costs excluding                     0.55
     infrastructure and payroll] x .021.................
                                                         ---------------
        Total Rate Per Hour--Appeal and Overtime........           73.99
------------------------------------------------------------------------


   Table 9.--Calculations for the Appeal and Overtime Hourly Rates for
                 Laboratory Program Services for FY 2009
------------------------------------------------------------------------
                                                            Apportioned
                   Laboratory services                       fee rate
------------------------------------------------------------------------
Appeal and Overtime Rates: Actual Salaries @ 1.5 (time
 and a half):
FY 2008 Salaries @ 1.5 = [FY 2007 Salaries ($21.95) + FY          $33.65
 2008 Pay Adjustment ($0.48)] x 1.5.....................
FY 2009 Pay Adjustment = FY 2008 Salaries @ 1.5 x 0.022.            0.74
    Benefits............................................            6.90
    Operational Costs...................................           11.60
    Infrastructure Cost.................................           16.15
    Program Overhead....................................            3.44
    Agency Overhead.....................................            3.28
    FY 2006 Inflation (2.1%) = [Costs excluding                     0.53
     infrastructure and payroll] x .021.................
    FY 2007 Inflation (2.2%) = [Costs excluding                     0.57
     infrastructure and payroll] x .022.................
    FY 2008 Inflation (2.1%) = [Costs excluding                     0.55
     infrastructure and payroll] x .021.................
    FY 2009 Inflation (2.1%) = [Costs excluding                     0.56
     infrastructure and payroll] x .021.................
                                                         ---------------
        Total Rate Per Hour--Appeal and Overtime........           77.97
------------------------------------------------------------------------

    Table 6 through Table 9 show the calculation of the total appeal 
and total overtime hourly fee rates to be rounded off for fiscal years 
2006 through 2009. These tables incorporate the differentials in costs 
associated with the necessity of laboratory personnel to work extended 
hours of service at the time and a half pay doing either overtime or 
appeal sample testing.

     Table 10.--Calculations for the Federal Holiday Hourly Rate for
                 Laboratory Program Services for FY 2006
------------------------------------------------------------------------
                                                            Apportioned
                   Laboratory services                       fee rate
------------------------------------------------------------------------
Holiday Rate: Actual Salaries @ 2.0 (double time):
    FY 2005 Salaries @ 2.0 [Actual 2005 Salaries                  $40.00
     ($20.00)] x 2.0....................................
    FY 2006 Pay Adjustment = [Actual FY 2005 Salaries               2.96
     ($20.00) x 0.031 + $0.86 (weighted portion @
     $119,500 increase for the FY 2006 period changes
     with payroll for within-grade pay step increases
     for General Schedule salaries, promotion pay costs,
     and new employee position pay costs)] x 2.0........
    Benefits............................................            6.96
    Operational Costs...................................           11.60
    Infrastructure Cost.................................            8.78
    Program Overhead....................................            3.44
    Agency Overhead.....................................            3.28
    FY 2006 Inflation (2.1%) = [Costs excluding                     0.53
     infrastructure and payroll] x .021.................
                                                         ---------------
        Total Rate Per Hour--Holidays...................           77.49
------------------------------------------------------------------------


[[Page 55374]]


     Table 11.--Calculations for the Federal Holiday Hourly Rate for
                 Laboratory Program Services for FY 2007
------------------------------------------------------------------------
                                                            Apportioned
                   Laboratory services                       fee rate
------------------------------------------------------------------------
Holiday Rate: Actual Salaries @ 2.0 (double time):
    FY 2006 Salaries @ 2.0 = [Actual 2005 Salaries                $42.96
     ($20.00) + 2006 Pay Adjustment ($1.48)] x 2.0......
    FY 2007 Pay Adjustment = FY 2006 Salaries @ 2.0 x               0.95
     0.022..............................................
    Benefits............................................            6.90
    Operational Costs...................................           11.60
    Infrastructure Cost.................................           11.75
    Program Overhead....................................            3.44
    Agency Overhead.....................................            3.28
    FY 2006 Inflation (2.1%) = [Costs excluding                     0.53
     infrastructure and payroll] x .021.................
    FY 2007 Inflation (2.2%) = [Costs excluding                     0.57
     infrastructure and payroll] x .022.................
                                                         ---------------
        Total Rate Per Hour--Holidays...................           81.98
------------------------------------------------------------------------


     Table 12.--Calculations for the Federal Holiday Hourly Rate for
                 Laboratory Program Services for FY 2008
------------------------------------------------------------------------
                                                            Apportioned
                   Laboratory services                       fee rate
------------------------------------------------------------------------
Holiday Rate: Actual Salaries @ 2.0 (double time):
    FY 2007 Salaries @ 2.0 = [FY 2006 Salaries ($21.48)           $43.90
     + FY 2007 Pay Adjustment ($0.47)] x 2.0............
    FY 2008 Pay Adjustment = FY 2007 Salaries @ 2.0 x               0.97
     0.022..............................................
    Benefits............................................            6.90
    Operational Costs...................................           11.60
    Infrastructure Cost.................................           13.47
    Program Overhead....................................            3.44
    Agency Overhead.....................................            3.28
    FY 2006 Inflation (2.1%) = [Costs excluding                     0.53
     infrastructure and payroll] x .021.................
    FY 2007 Inflation (2.2%) = [Costs excluding                     0.57
     infrastructure and payroll] x .022.................
    FY 2008 Inflation (2.1%) = [Costs excluding                     0.55
     infrastructure and payroll] x .021.................
                                                         ---------------
        Total Rate Per Hour--Holidays...................           85.21
------------------------------------------------------------------------


     Table 13.--Calculations for the Federal Holiday Hourly Rate for
                 Laboratory Program Services for FY 2009
------------------------------------------------------------------------
                                                            Apportioned
                   Laboratory services                       fee rate
------------------------------------------------------------------------
Holiday Rate: Actual Salaries @ 2.0 (double time):
    FY 2008 Salaries @ 2.0 = [FY 2007 Salaries ($21.95)           $44.86
     + FY 2008 Pay Adjustment ($0.48)] x 2.0............
    FY 2009 Pay Adjustment = FY 2008 Salaries @ 2.0 x               0.99
     0.022..............................................
    Benefits............................................            6.90
    Operational Costs...................................           11.60
    Infrastructure Cost.................................           16.15
    Program Overhead....................................            3.44
    Agency Overhead.....................................            3.28
    FY 2006 Inflation (2.1%) = [Costs excluding                     0.53
     infrastructure and payroll] x .021.................
    FY 2007 Inflation (2.2%) = [Costs excluding                     0.57
     infrastructure and payroll] x .022.................
    FY 2008 Inflation (2.1%) = [Costs excluding                     0.55
     infrastructure and payroll] x .021.................
    FY 2009 Inflation (2.1%) = [Costs excluding                     0.56
     infrastructure and payroll] x .021.................
                                                         ---------------
        Total Rate Per Hour--Holidays...................           89.43
------------------------------------------------------------------------

    Table 10 through Table 13 show the calculation of the total legal 
holiday hourly fee rates to be rounded off for fiscal years 2006 
through 2009. These tables incorporate the differentials in costs 
associated with the necessity of laboratory personnel to work extended 
hours of service at the double hourly pay rate doing sample testing on 
a Federal holiday or a designated day for the Federal holiday.
    The Agency proposes to recover the actual cost of services for 
multiple fiscal years covered by this rule. These fee increases are 
essential for the continued sound financial management of the Agency's 
budget. In order to enhance the transparency of the hourly fee rates in 
the aforementioned Tables 3 through 13 for fiscal year 2007, fiscal 
year 2008 and fiscal year 2009, a description is provided of each fee 
charge category. Federal salaries with national and locality pay 
adjustments and choices in benefits are made available on an annual 
basis by the Office of Personnel Management (OPM). Operational costs 
include expenses for rents, communications, utilities, medical

[[Page 55375]]

examinations, safety equipment, sample preparation equipment, training, 
trash and hazardous waste disposal, travel and transportation costs. 
Communication expenditures include costs for photocopying, printing, e-
mailing, Internet services, telephone, and faxing equipment. There have 
been large capital improvement expenditures in the laboratories in 
recent years. These expenditures include costs for the Food Emergency 
Response Network (FERN) and the capital improvements for the 
Environmental Management Systems (EMS) in accordance with the 
applicable mandates for Federal laboratories of Executive Order 13148 
of April 21, 2000, Greening the Government Through Leadership in 
Environmental Management (65 FR 24593). These capital improvement costs 
are included in the normal operations of the Science and Technology 
field service laboratories. In addition, operational costs include 
expenses for office and laboratory supplies, chemicals, reagents, 
security and guard services, waste removal, robots, cleaning and 
internal building maintenance, billing and collection services, and a 
Laboratory Information Management System (LIMS). Infrastructure costs 
are mainly laboratory instruments and capital equipment with service 
and maintenance contracts and replacement spare parts. Infrastructure 
expenses include consumable supply costs associated directly with the 
proper operation of analytical instruments and laboratory equipment. 
Stakeholders demand that AMS provide cost effective and timely product 
testing requiring modern and sometimes automated instrumentation. These 
instruments are expensive and undergo equipment capitalization for 
determining costs. Equipment capitalization is the determined cost per 
year to replace the equipment after its useful service life has been 
established. Infrastructure costs include database acquisitions and 
maintenance for e-business. Infrastructure costs include large computer 
hardware and software expenses. Agency and Program overhead is the pro-
rated share, attributable to a particular service, of the agency's 
management and support costs. Management and administrative support 
costs include the costs of providing budget and accounting services, 
regulatory services, investigative and enforcement services, debt-
management services, personnel services, public information services, 
legal services, statistical services, and other general program and 
agency management services of support activities above the local 
laboratory level. Overhead expenditures are allocated across the Agency 
for each direct hour of laboratory service.
    AMS no longer uses the Billings and Collections System (BLCO) for 
billings and collections through the National Finance Center (NFC) in 
New Orleans, LA. The Agency now uses the ``accounts receivable'' 
functions in Foundation Financial Information System (FFIS) as the 
document feeder system for customer billings and the collections now 
come through our lockbox. Accordingly, Sec.  91.42 would be updated to 
reflect these changes. The regulations also are updated to identify 
current facility addresses.
    This proposed rule would also remove and reserve 7 CFR part 92. 
Part 92 is obsolete because it relates to the mandatory testing of 
imported tobacco for prohibited pesticide residues and the statutory 
requirement for such testing has been removed by the Fair and Equitable 
Tobacco Reform Act of 2004 (7 U.S.C. 518). The tests had been conducted 
by Science and Technology (S&T) Programs for the AMS Tobacco Program, 
which sampled imported tobacco and administered the program for 
imported tobacco.

Executive Order 12866, Regulatory Flexibility Act, and Paperwork 
Reduction Act

    This proposed rule has been reviewed under Executive Order 12866. 
Although not economically significant, this rule has been determined to 
be significant for the purposes of Executive Order 12866 and, 
therefore, has been reviewed by the Office of Management and Budget 
(OMB).
    An economic analysis follows to review the impacts on laboratory 
customers of the proposed revisions in AMS voluntary user fees for 
laboratory services. The economic analysis provides a cost-benefit 
analysis as required by Executive Order 12866 and an analysis of the 
potential economic effects on small entities as required by the 
Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq.). In accordance 
with 5 U.S.C. 603, AMS has performed an Initial Regulatory Flexibility 
Analysis for this proposed rule. AMS is inviting comments about this 
proposed rule as it relates to small entities. In particular, AMS is 
interested in obtaining information concerning the number and kind of 
small entities who may incur benefits or costs from implementation of 
this proposed rule and the impact of those benefits or costs on 
decisions to utilize AMS voluntary testing services.
    Regulations must be designed in the most cost-effective manner 
possible to obtain the objective of a sustainable cost recovery program 
while imposing the least burden on society. AMS has prepared a 
Regulatory Impact Assessment (RIA) consisting of a statement of the 
need for the proposed action, an examination of alternative approaches, 
and an economic analysis of the benefits and costs.

Need for Proposed Action.

    The AMS laboratory testing programs are voluntary, user fee 
services conducted under the authority of the Agricultural Marketing 
Act of 1946 (AMA), as amended (7 U.S.C. 1621, et seq.). The AMA 
authorizes the Secretary of Agriculture to provide Federal analytical 
testing services that facilitate marketing and trade. The AMA also 
requires that reasonable fees be collected from the users of the 
services to cover as nearly as practicable the costs of maintaining the 
programs.
    Science and Technology (S&T) Programs of AMS regularly reviews its 
user-fee-financed laboratory service programs to determine if the fee 
levels are adequate. The most recent review determined that the 
existing fee schedule, effective October 27, 2000 (65 FR 64302) does 
not generate sufficient revenues to recover operating costs. For fiscal 
year 2005 the Science and Technology program reported a $702,000 
deficit at the current fee levels. The Science and Technology program 
costs and revenues for fiscal year 2005 were $6,393,000 and $5,691,000, 
respectively. Program obligations for fiscal year 2006 are projected at 
$6,602,000 and revenues are projected at $5,834,000 for an estimated 
deficit of $768,000. With this proposed action, the Agency expects to 
collect an estimated $6,521,000, $7,186,000, and $7,553,000 in fiscal 
years 2007 through 2009 respectively, to cover the cost of routine 
laboratory services, appeal requests, overtime, and holiday services 
for Science and Technology customers and other program stakeholders.

Alternatives

    Alternatives to the proposed rate increase were considered by the 
Agency. One alternative to this proposed rule would be to make no 
changes to the current user fees. As a result, AMS would not recover 
the full cost of program activities and services would have to be 
reduced or terminated. Were this to happen, the users of AMS laboratory 
services would be unable to meet certain AMS program requirements, 
would find it more difficult to meet foreign government or importer 
testing requirements, and would lose the opportunity to support

[[Page 55376]]

their marketing efforts with what they believe to be preferred 
government laboratory test results. Consequently, AMS does not consider 
this alternative to be reasonable.
    Another alternative considered would be to calculate the fee 
increases needed over the next three year period and then spread this 
overall increase evenly in annual increments. Because the increases are 
necessary to cover on-going costs, e.g., rent, salaries and benefits, 
and equipment replacement, and financial stability needs to be 
maintained for this program, adequate funds must be generated 
immediately, rather than spread over a three year period. Thus, AMS 
does not consider this alternative to be reasonable.
    To ensure full costs are being covered as they are incurred, the 
preferred alternative is to match fee increases with expected costs on 
an annual basis over the next three years. This alternative will assure 
costs are appropriately covered and that laboratory testing services 
remain available as program customers request them. With this proposed 
action, the Agency expects to collect an estimated $6,521,000, 
$7,186,000, and $7,553,000 in fiscal years 2007 through 2009, 
respectively, to cover the cost of routine laboratory services, appeal 
requests, overtime, and holiday services.

Summary of Impacts

    Under this proposal AMS would continue to offer laboratory testing 
services under the Agricultural Marketing Act of 1946 as amended, to 
facilitate marketing and allow products to obtain grade designations or 
meet marketing standards. As such, the program provides a viable option 
for a wide variety of clients by delivering scientific and analytical 
support services to the agricultural community and provides a valuable 
resource for those businesses and industries that wish to use a USDA 
shield.
    Further, by proposing a three year fee increase instead of a single 
year fee increase, the Agency would help ensure that the fee increases 
are effective at the beginning of each fiscal year on October 1. An 
increase over three fiscal years would permit customers and other 
program stakeholders an opportunity to plan for annual changes in costs 
of laboratory service and to incorporate them into their budgetary 
plans.
    For analytical purposes, projected collections are based on 
calculations using an effective date of October 1, 2006 for the 
proposed fiscal year 2007 user fees. There are essentially three rate 
increases being proposed for the basic laboratory services--$45 to $60 
or 33.3 percent in fiscal year 2007, $60 to $63 or 5.0 percent in 
fiscal year 2008 and $63 to $67 or 6.4 percent in fiscal year 2009. The 
rate increases for overtime and appeals are $67.50 to $71 or 5.2 
percent, $71 to $74 or 4.2 percent, and $74 to $78 or 5.4 percent in 
fiscal years 2007, 2008, and 2009, respectively. The rate increases for 
holiday service are $67.50 to $82 or 21.5 percent, $82 to $85 or 3.7 
percent, and $85 to $89 or 4.7 percent in fiscal years 2007, 2008, and 
2009, respectively. This is a voluntary program and the costs to each 
user would be proportional to their use of laboratory services each 
year. The increased fees will cover inflation and national and locality 
pay raises and replacement of equipment and other infrastructure 
improvements.
    Under the Regulatory Flexibility Act, the impact ofthis proposed 
rule on small businesses must be analyzed. There are 811 current users 
of AMS laboratory testing services. Such users of services include food 
processors, handlers, growers, Federal and State government agencies, 
and exporters. Many of these users are small entities under the 
criteria established by the Small Business Administration (13 CFR 
121.201). Any decision by stakeholders and customers to discontinue the 
use of the laboratory services because of increased fees would not 
hinder food processors or other industry members from marketing their 
products.
    For the following cost analysis, certain assumptions are used. 
First, base year data is actual fiscal year 2005 amount billed for 
voluntary services performed for the public. Second, seven percent of 
the total amount billed represents overtime costs and five percent 
represents costs related to appeals. Third, the calculated amounts in 
fiscal year 2007 are using the base year data as if the base year was 
fiscal year 2006. Fourth, each of the 811 customers had the exact same 
tests, using the same amount of time, and thus were billed the exact 
same amount. This customer is the ``average'' laboratory customer.
    Table 14 sets the total levels for the dollar ($) amounts billed in 
the base year (Fiscal Year 2006).

              Table 14.--Base Year Data (Fiscal Year 2006)
------------------------------------------------------------------------
 
------------------------------------------------------------------------
Total Billed............................................      $1,536,688
Basic Laboratory Services...............................       1,352,285
Overtime Costs (7%).....................................         107,568
Appeal Costs (5%).......................................          76,834
------------------------------------------------------------------------

    Table 15 presents the base year costs and estimates costs in fiscal 
year 2007, fiscal year 2008, and fiscal year 2009 for the ``average'' 
laboratory customer. The base year values are derived by dividing basic 
laboratory services, overtime costs, and appeal costs by 811. The 
values for fiscal years 2007, 2008, and 2009 are derived multiplying 
each year by the appropriate percentage rate.

              Table 15.--Costs ($) for the ``Average'' Customer, Base Year Through Fiscal Year 2009
----------------------------------------------------------------------------------------------------------------
                                                                                                        Total
                                                  Base year     FY 2007      FY 2008      FY 2009      Diff.\1\
----------------------------------------------------------------------------------------------------------------
Lab Services...................................        1,667        2,223        2,334        2,483          816
Overtime.......................................          133          140          146          154           21
Appeals........................................           95          100          104          110           15
                                                ----------------------------------------------------------------
    Total......................................        1,895        2,463        2,584        2,747         852
----------------------------------------------------------------------------------------------------------------
\1\ Net difference calculated between costs in dollars ($) between base year and Fiscal Year 2009.

    After the third increase, the customer will pay an additional 
average of $852 for all laboratory services. This is a 44.96 percent 
increase over the base year. The percentage increase for the basic 
laboratory services is 49.0 percent, overtime is 15.8 percent, and an 
appeal sample is 15.8 percent.

[[Page 55377]]



         Table 16.--Costs ($) for a ``Large Business'' Customer, Base Year Through Fiscal Year (FY) 2009
----------------------------------------------------------------------------------------------------------------
                                                                                                        Total
                                                  Base year     FY 2007      FY 2008      FY 2009      diff.\1\
----------------------------------------------------------------------------------------------------------------
Lab Services...................................      704,000      938,432      985,354    1,048,417      344,417
Overtime.......................................       56,000       58,912       61,386       64,701        8,701
Appeals........................................       40,000       42,080       43,847       46,215        6,215
                                                ----------------------------------------------------------------
    Total......................................      800,000    1,039,424    1,090,587    1,159,333     359,333
----------------------------------------------------------------------------------------------------------------
\1\ Net difference calculated between costs in dollars ($) between base year and Fiscal Year 2009.

    Table 16 presents the base year costs and estimates costs in fiscal 
years 2007, 2008, and 2009 for a ``large business'' laboratory 
customer. While the numerical values increase significantly, the 
percentages are the same. Even though the ``large business'' customer 
is paying $359,333 more then what was paid for the same services in the 
base year, the increase is still approximately 44.9 percent above what 
was billed in the base year.
    The same is true for a ``small business'' customer. Table 17 
presents the costs associated with a customer billed $29,000. Again the 
total difference between the billing in fiscal year 2009 and the base 
year is significantly smaller than the billing of an ``average'' 
customer, but the percentage increase is still near 44.9 percent.

         Table 17.--Costs ($) for a ``Small Business'' Customer, Base Year Through Fiscal Year (FY) 2009
----------------------------------------------------------------------------------------------------------------
                                                                                                        Total
                                                  Base year     FY 2007      FY 2008      FY 2009      diff.\l\
----------------------------------------------------------------------------------------------------------------
Lab Services...................................       25,520       34,018       35,719       38,005       12,485
Overtime.......................................        2,030        2,136        2,226        2,346          316
Appeals........................................        1,450        1,525        1,589        1,675          225
                                                ----------------------------------------------------------------
    Total......................................       29,000       37,679       39,534       42,026      13,026
----------------------------------------------------------------------------------------------------------------
\1\ Net difference calculated between costs in dollars ($) between base year and FY 2009.

    Under the Regulatory Flexibility Act, the impact of this proposed 
rule on small businesses must be considered. The Agency estimates that 
25 percent of the laboratory fees billed in fiscal year 2005 was to 
small businesses. Thus, a total of $384,172 was billed to small 
businesses. If the entire proposed fee increase had been implemented, 
small businesses would have been billed $556,665, a 44.9 percent 
increase.
    One question is how each of these customers including small 
businesses will react to cost increases at these amounts. The increases 
are spread over a three year period which will mitigate some of the 
impact. But the focus should be on the reaction to the increase 
occurring in fiscal year 2007 which is a one third increase over the 
base year. The answer is dependent on the customer's business, and is 
proportional to the number of samples involved. The lower the cost per 
unit of product being sampled, the higher the probability the customer 
will continue to use AMS laboratory services and pass on some or all of 
the additional costs, the exact amount of which is not known. Also, use 
of AMS laboratory services is voluntary and other private or public 
laboratory options are available.
    This proposed rule contains no new information collection or 
recordkeeping requirements that are subject to the Office of Management 
and Budget (OMB) approval under the Paperwork Reduction Act of 1995 (44 
U.S.C. 3501-3520). AMS is committed to implementation of the Government 
Paperwork Elimination Act which provides for the use of information 
resources to improve the efficiency and effectiveness of governmental 
operations, including providing the public with the option of 
submitting information or transacting business electronically to the 
extent practicable. USDA has not identified any relevant Federal rules 
that duplicate, overlap, or conflict with this rule.

Unfunded Mandate Analysis

    Title II of the Unfunded Mandate Reform Act of 1995 (UMRA), Public 
Law 104-4, establishes requirements for Federal agencies to assess the 
effects of their regulatory actions on State, local, and tribal 
governments and the private sector. Under section 202 of UMRA, the 
Department generally must prepare a written statement, including a cost 
benefit analysis, for proposed and final rules with ``Federal 
mandates'' that may result in expenditures to State, local, or tribal 
governments, in the aggregate, or to the private sector, of $100 
million or more in anyone year. When such a statement is needed for a 
rule, section 205 of UMRA generally requires that the Department 
identify and consider a reasonable number of regulatory alternatives 
and adopt the least costly, more cost-effective or least burdensome 
alternative that achieves the objectives of the rule.
    This rule contains no Federal mandates (under the regulatory 
provisions of Title II of the UMRA) that impose costs on State, local, 
or tribal governments or to the private sector of $100 million or more 
in anyone year. Thus, this rule is not subject to the requirements of 
sections 202 and 205 of UMRA.

Civil Justice Reform (Executive Order 12988)

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

Civil Rights Review

    AMS has considered the potential civil rights implications of this 
rule on minorities, women, or persons with disabilities to ensure that 
no person or group shall be discriminated against on the basis of race, 
color, national origin,

[[Page 55378]]

gender, religion, age, disability, sexual orientation, marital or 
family status, political beliefs, parental status, or protected genetic 
information. AMS has included at Sec.  91.7 the provision in the 
regulation under part 91 to describe in detail the requirements for 
nondiscrimination when reviewing or granting any person or entity the 
benefits of Science and Technology Programs laboratory service. This 
regulation is consistent with USDA regulations which prohibit 
discrimination in its programs and activities.
    This proposed rule would not require affected entities to relocate 
or alter their operations in ways that could adversely affect such 
persons or groups. Further, this proposed rule would not deny any 
persons or groups the benefits of the program or subject any persons or 
groups to discrimination.
    AMS has reviewed this proposed rule in accordance with the 
Department Regulation 4300-4, ``Civil Rights Impact Analysis.'' AMS has 
determined this proposed action ensures the civil rights of all Science 
and Technology Programs applicants and customers. They represent 
minorities (24.4%), women (51.1%), and persons with disabilities 
(14.5%) in the same percent proportions to the entire customer base as 
their compositions are represented in the total approximate general 
population (299 million) of the United States of America available in 
descriptive tables at https://www.census.gov/. In addition, each and 
every customer would receive the same user fee for each identical 
service.

Comments

    A thirty day comment period is provided for interested persons to 
comment on this proposed action. All comments received by October 23, 
2006 will be considered. A thirty day period for public comment is 
justified in order to allow the agency to recover the full cost of 
operating a voluntary user fee laboratory testing program. The existing 
fee schedules have been in place since October 2000. AMS regularly 
reviews its user-fee-supported programs to determine if the voluntary 
fees are adequate to cover expenses. Due to the length of the 
rulemaking process, the fiscal year has partially elapsed by the time 
the agency publishes a final rule to amend its fees. As a result the 
agency is unable to recover the full cost of its services in a timely 
manner. Therefore, a thirty day comment period is reasonable.

List of Subiects

7 CFR Part 91

    Administrative practice and procedure, Agricultural commodities, 
Laboratories, Reporting and recordkeeping requirements.

7 CFR Part 92

    Agricultural commodities, Laboratories, Pesticides and pests, 
Tobacco.

    Under the authority of 7 U.S.C. 1622 and 1624, the Agricultural 
Marketing Service proposes to amend parts 91 and 92 of Title 7, chapter 
I, subchapter E, of the Code of Federal Regulations as follows:

PART 91--SERVICES AND GENERAL INFORMATION [AMENDED]

    1. The authority citation for part 91 continues to read as follows:

    Authority: 7 U.S.C. 1622, 1624.

    2. Section 91.5 is revised to read as follows:


Sec.  91.5  Where services are offered.

    (a) Services are offered to applicants at the Science and 
Technology laboratories and facilities as listed below.
    (1) Science and Technology Programs National Science Laboratory. A 
variety of proximate, chemical, microbiological and biomolecular tests 
and laboratory analyses performed on fruits and vegetables, poultry, 
meat and meat products, fiber products and processed foods are 
performed at the Science and Technology Programs (S&T) laboratory 
located at: USDA, AMS, Science and Technology Programs, National 
Science Laboratory (NSL), 801 Summit Crossing Place, Suite B, Gastonia, 
North Carolina 28054-2193.
    (2) Science and Technology (S&T) Programs Science Satellite 
Laboratories. The specialty satellite laboratories performing aflatoxin 
and other testing on peanuts, peanut products, dried fruits, grains, 
edible seeds, tree nuts, shelled corn products, oilseed products, 
vegetable oils, juices, citrus products, and other commodities are 
located as follows:
    (i) USDA, AMS, Science & Technology, Citrus Laboratory, 98 Third 
Street, SW., Winter Haven, Florida 33880-2905.
    (ii) USDA, AMS, Science & Technology, 6567 Chancey Mill Road, 
Blakley, Georgia 39823-2785.
    (iii) USDA, AMS, Science & Technology, c/o Golden Peanut Company 
LLC, (Mail: P.O. Box 272), 715 Martin Luther King Drive, Dawson, 
Georgia 39842-1002.
    (iv) USDA, AMS, Science & Technology, 107 South Fourth Street, 
Madill, Oklahoma 73446-3431.
    (v) USDA, AMS, Science & Technology, (Mail: P.O. Box 1130), 308 
Culloden Street, Suffolk, VA 23434-4706.
    (3) Program laboratories. Laboratory services are available in all 
areas covered by cooperative agreements providing for this laboratory 
work and entered on behalf of the Department with cooperating Federal 
or State laboratory agencies pursuant to authority contained in Act(s) 
of Congress. Also, services may be provided in other areas not covered 
by a cooperative agreement if the Administrator determines that it is 
possible to provide such laboratory services.
    (4) Other alternative laboratories. Laboratory analyses may be 
conducted at alternative Science and Technology Programs laboratories 
and can be reached from any commodity market in which a laboratory 
facility is located to the extent laboratory personnel are available.
    (5) The Plant Variety Protection (PVP) Office. The PVP office and 
plant examination facility of the Science and Technology programs 
issues certificates of protection to developers of novel varieties of 
plants which reproduce sexually. The PVP office is located as follows: 
USDA, AMS, Science & Technology Programs, Plant Variety Protection 
Office, National Agricultural Library Building, Room 401, 10301 
Baltimore Boulevard, Beltsville, MD 20705-2351.
    (6) Science and Technology Programs headquarters offices. The 
examination, licensure, quality assurance reviews, laboratory approval/
certification and consultation services are provided by headquarters 
staff located in Washington, DC. The main headquarters office is 
located as follow: USDA, AMS, Science and Technology Programs, Office 
of the Deputy Administrator, South Agriculture Bldg., Mail Stop 0270, 
1400 Independence Ave., SW., Washington, DC 20250-0270.
    (7) The Information Technology (IT) Group. The IT office of the 
Science and Technology Programs is headed by the Associate Deputy 
Administrator for Technology/Chief Information Officer and provides 
information technology services and management systems to the Agency 
and other agencies within the USDA. The main IT office is located as 
follows: USDA, AMS, Science and Technology, Office of the Associate 
Deputy Administrator for Technology, 1752 South Agriculture Bldg., Mail 
Stop

[[Page 55379]]

0204, 1400 Independence Ave., SW., Washington, DC 20250-0204.
    (8) Statistics Branch Office. The Statistics Branch office of 
Science and Technology Programs (S&T) provides statistical services to 
the Agency and other agencies within the USDA. In addition, the 
Statistics Branch office generates sample plans and performs consulting 
services for research studies in joint efforts with or in a leading 
role with other program areas of AMS or of the USDA. The Statistics 
Branch office is located as follows: USDA, AMS, S&T Statistics Branch, 
0603 South Agriculture Bldg., Mail Stop 0223, 1400 Independence Ave., 
SW., Washington, DC 20250-0223.
    (9) Technical Services Branch Office. The Technical Services Branch 
office of Science and Technology (S&T) provides technical support 
services to all Agency programs and other agencies within the USDA. In 
addition, the Technical Services Branch office provides certification 
and approval services of private and State government laboratories as 
well as oversees quality assurance programs; import and export 
certification of laboratory tested commodities. The Technical Services 
Branch mailing address is as follows: USDA, AMS, S&T Technical Services 
Branch, South Agriculture Bldg., Mail Stop 0272, 1400 Independence 
Ave., SW., Washington, DC 20250-0272. The Technical Services Branch 
office is located as follows: USDA, AMS, Science and Technology 
Technical Services Branch, Room 306, Cotton Annex Bldg., 300 12th 
Street, SW., Washington, DC 20250.
    (10) Monitoring Programs Office. Services afforded by the Pesticide 
Data Program (PDP) and Microbiological Data Program (MDP) are provided 
by USDA, AMS, Science and Technology Monitoring Programs Office, 8609 
Sudley Road, Suite 206, Manassas, VA 20110-8411.
    (11) Pesticide Records Branch Office. Services afforded by the 
Federal Pesticide Record Keeping Program for restricted-use pesticides 
by