Changes in Hourly Fee Rates for Science and Technology Laboratory Services-Fiscal Years 2007-2009, 15011-15021 [E7-5787]

Download as PDF 15011 Rules and Regulations Federal Register Vol. 72, No. 61 Friday, March 30, 2007 This section of the FEDERAL REGISTER contains regulatory documents having general applicability and legal effect, most of which are keyed to and codified in the Code of Federal Regulations, which is published under 50 titles pursuant to 44 U.S.C. 1510. The Code of Federal Regulations is sold by the Superintendent of Documents. Prices of new books are listed in the first FEDERAL REGISTER issue of each week. DEPARTMENT OF AGRICULTURE Agricultural Marketing Service 7 CFR Parts 91 and 92 [Docket Number: AMS–ST–07–0045: 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: Final rule. cprice-sewell on PROD1PC66 with RULES AGENCY: SUMMARY: The Agricultural Marketing Service (AMS) is changing the hourly fee rates for Science and Technology (S&T) Laboratory Services. The agency is raising 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 regulation, AMS is providing for three annual standard hourly fee rate increases for fiscal years 2007–2009. This will provide the agricultural commodity industries and other stakeholders with more timely and relevant information regarding user fees for voluntary laboratory testing services. The agency is also removing tables and schedules with listings of individual tests and services. Three annual hourly fee rate adjustments are established by this action for appeals, holiday, and overtime services to reflect the anticipated increase cost of providing these laboratory services each fiscal year. The regulations also are updated to identify current facility addresses. Part VerDate Aug<31>2005 15:49 Mar 29, 2007 Jkt 211001 92 is obsolete and therefore has been removed. DATES: Effective March 31, 2007. FOR FURTHER INFORMATION CONTACT: 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. 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 will be $60.00 per hour for the remainder of fiscal year 2007, and will increase to $63.00 per hour in fiscal year 2008, and $67.00 per hour in fiscal year 2009. The premium hourly fee rates will 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 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, PO 00000 Frm 00001 Fmt 4700 Sfmt 4700 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. With this rulemaking, AMS will amend its regulations to provide for annual hourly fee rate increases for laboratory services over three years (FYs 2007 through 2009) in one action. AMS will continue to perform a yearly cost analysis to determine whether the voluntary hourly fee rates established for its user-fee-supported laboratory service programs 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 established 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 will 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 will 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 new hourly fee rates will recover these costs, and none of the fees collected for testing services referenced in this final rule are used for a biotechnology verification program specified in Federal Register Notice (67 FR 50853), August 6, 2002. E:\FR\FM\30MRR1.SGM 30MRR1 15012 Federal Register / Vol. 72, No. 61 / Friday, March 30, 2007 / Rules and Regulations AMS calculated its actual costs for fiscal years 2001 through 2006 and its projected increases in salaries and inflation in fiscal years 2007 through 2009. The 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 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, only 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 NEW 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 FY 2008 rate 2 FY 2009 rate 3 $ 60.00 71.00 71.00 82.00 $ 63.00 74.00 74.00 85.00 $ 67.00 78.00 78.00 89.00 values for FY 2007–FY 2009 are rounded off to nearest whole dollar. With this action, the AMS will amend its regulations to provide for three annual fee increases in one action. Table 1 shows the summary of the current rates and the new 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 Laboratory services Base Time: Actual FY 2005 Salaries 1 @ $2,787,474 .................................................................................................................................... FY 2006 Pay Adjustment 2 = [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) .................................................................................................................... Benefits 3 ....................................................................................................................................................................................... Operational Costs 4 ....................................................................................................................................................................... Infrastructure Cost 5 ...................................................................................................................................................................... Program Overhead 6 ..................................................................................................................................................................... Agency Overhead 7 ....................................................................................................................................................................... FY 2006 Inflation (2.1%) = [Costs excluding infrastructure and payroll] × .021 ................................................................... Total Rate Per Hour¥Base Time ......................................................................................................................................... 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 $20.00 1.48 6.90 11.60 8.78 3.44 3.28 0.53 56.01 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 cprice-sewell on PROD1PC66 with RULES 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 ....................................................................................................................................................................... VerDate Aug<31>2005 15:49 Mar 29, 2007 Jkt 211001 PO 00000 Frm 00002 Fmt 4700 Sfmt 4700 E:\FR\FM\30MRR1.SGM 30MRR1 $21.48 0.47 6.90 11.60 11.75 3.44 Federal Register / Vol. 72, No. 61 / Friday, March 30, 2007 / Rules and Regulations 15013 TABLE 3.—CALCULATIONS FOR THE STANDARD HOURLY RATE FOR LABORATORY PROGRAM SERVICES FOR FY 2007— Continued Apportioned fee rate Laboratory services Agency Overhead ......................................................................................................................................................................... FY 2006 Inflation (2.1%) = [Costs excluding infrastructure and payroll] × .021 .......................................................................... FY 2007 Inflation (2.2%) = [Costs excluding infrastructure and payroll] × .022 .......................................................................... 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 Laboratory services $ 22.43 0.49 6.90 11.60 16.15 3.44 3.28 0.53 0.57 0.55 0.56 Total Rate Per Hour¥Base Time ......................................................................................................................................... cprice-sewell on PROD1PC66 with RULES Base Time: FY 2008 Salaries = FY 2007 Salaries ($21.95) + FY 2008 Pay Adjustment ($0.48) ................................................................. FY 2009 Pay Adjustment = FY 2008 Salaries x 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 .......................................................................... 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 VerDate Aug<31>2005 15:49 Mar 29, 2007 Jkt 211001 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, PO 00000 Frm 00003 Fmt 4700 Sfmt 4700 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. E:\FR\FM\30MRR1.SGM 30MRR1 15014 Federal Register / Vol. 72, No. 61 / Friday, March 30, 2007 / Rules and Regulations 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 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)] x 1.5 ........................................... FY 2007 Pay Adjustment = FY 2006 Salaries @ 1.5 x 0.022 ..................................................................................................... Benefits ......................................................................................................................................................................................... Operational Costs ......................................................................................................................................................................... Infrastructure Cost ........................................................................................................................................................................ Program Overhead ....................................................................................................................................................................... Agency Overhead ......................................................................................................................................................................... FY 2006 Inflation (2.1%) = [Costs excluding infrastructure and payroll] x .021 .......................................................................... FY 2007 Inflation (2.2%) = [Costs excluding infrastructure and payroll] x .022 .......................................................................... $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 ........................................................................................................................ 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)] x 1.5 ........................................... FY 2008 Pay Adjustment = FY 2007 Salaries @ 1.5 x 0.022 ..................................................................................................... Benefits ......................................................................................................................................................................................... Operational Costs ......................................................................................................................................................................... Infrastructure Cost ........................................................................................................................................................................ Program Overhead ....................................................................................................................................................................... Agency Overhead ......................................................................................................................................................................... FY 2006 Inflation (2.1%) = [Costs excluding infrastructure and payroll] x .021 .......................................................................... FY 2007 Inflation (2.2%) = [Costs excluding infrastructure and payroll] x .022 .......................................................................... FY 2008 Inflation (2.1%) = [Costs excluding infrastructure and payroll] x .021 .......................................................................... $32.93 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 cprice-sewell on PROD1PC66 with RULES 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)] x 1.5 ........................................... FY 2009 Pay Adjustment = FY 2008 Salaries @ 1.5 x 0.022 ..................................................................................................... Benefits ......................................................................................................................................................................................... Operational Costs ......................................................................................................................................................................... Infrastructure Cost ........................................................................................................................................................................ Program Overhead ....................................................................................................................................................................... Agency Overhead ......................................................................................................................................................................... VerDate Aug<31>2005 15:49 Mar 29, 2007 Jkt 211001 PO 00000 Frm 00004 Fmt 4700 Sfmt 4700 E:\FR\FM\30MRR1.SGM 30MRR1 $33.65 0.74 6.90 11.60 16.15 3.44 3.28 Federal Register / Vol. 72, No. 61 / Friday, March 30, 2007 / Rules and Regulations 15015 TABLE 9.—CALCULATIONS FOR THE APPEAL AND OVERTIME HOURLY RATES FOR LABORATORY PROGRAM SERVICES FOR FY 2009—Continued Apportioned fee rate Laboratory services FY FY FY FY 2006 2007 2008 2009 Inflation Inflation Inflation Inflation (2.1%) (2.2%) (2.1%) (2.1%) = = = = [Costs [Costs [Costs [Costs excluding excluding excluding excluding .......................................................................... .......................................................................... .......................................................................... .......................................................................... 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. infrastructure infrastructure infrastructure infrastructure and and and and payroll] payroll] payroll] payroll] x x x x .021 .022 .021 .021 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)] x 2.0 .................................................................................................. FY 2006 Pay Adjustment = [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)] x 2.0 ........................................................................................................ Benefits ......................................................................................................................................................................................... Operational Costs ......................................................................................................................................................................... Infrastructure Cost ........................................................................................................................................................................ Program Overhead ....................................................................................................................................................................... Agency Overhead ......................................................................................................................................................................... FY 2006 Inflation (2.1%) = [Costs excluding infrastructure and payroll] x .021 .......................................................................... Total Rate Per Hour¥Holidays ............................................................................................................................................. $40.00 2.96 6.90 11.60 8.78 3.44 3.28 0.53 77.49 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)] x 2.0 ........................................... FY 2007 Pay Adjustment = FY 2006 Salaries @ 2.0 x 0.022 ..................................................................................................... Benefits ......................................................................................................................................................................................... Operational Costs ......................................................................................................................................................................... Infrastructure Cost ........................................................................................................................................................................ Program Overhead ....................................................................................................................................................................... Agency Overhead ......................................................................................................................................................................... FY 2006 Inflation (2.1%) = [Costs excluding infrastructure and payroll] x .021 .......................................................................... FY 2007 Inflation (2.2%) = [Costs excluding infrastructure and payroll] x .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 cprice-sewell on PROD1PC66 with RULES 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)] x 2.0 ........................................... FY 2008 Pay Adjustment = FY 2007 Salaries @ 2.0 x 0.022 ..................................................................................................... Benefits ......................................................................................................................................................................................... Operational Costs ......................................................................................................................................................................... Infrastructure Cost ........................................................................................................................................................................ Program Overhead ....................................................................................................................................................................... Agency Overhead ......................................................................................................................................................................... FY 2006 Inflation (2.1%) = [Costs excluding infrastructure and payroll] x .021 .......................................................................... VerDate Aug<31>2005 15:49 Mar 29, 2007 Jkt 211001 PO 00000 Frm 00005 Fmt 4700 Sfmt 4700 E:\FR\FM\30MRR1.SGM 30MRR1 $43.90 0.97 6.90 11.60 13.47 3.44 3.28 0.53 15016 Federal Register / Vol. 72, No. 61 / Friday, March 30, 2007 / Rules and Regulations TABLE 12.—CALCULATIONS FOR THE FEDERAL HOLIDAY HOURLY RATE FOR LABORATORY PROGRAM SERVICES FOR FY 2008—Continued Apportioned fee rate Laboratory services FY 2007 Inflation (2.2%) = [Costs excluding infrastructure and payroll] x .022 .......................................................................... FY 2008 Inflation (2.1%) = [Costs excluding infrastructure and payroll] x .021 .......................................................................... 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 ............................................................................................................................................. cprice-sewell on PROD1PC66 with RULES Holiday Rate: Actual Salaries @ 2.0 (double time) FY 2008 Salaries @ 2.0 = [FY 2007 Salaries ($21.95) + FY 2008 Pay Adjustment ($0.48)] x 2.0 ........................................... FY 2009 Pay Adjustment = FY 2008 Salaries @ 2.0 x 0.022 ..................................................................................................... Benefits ......................................................................................................................................................................................... Operational Costs ......................................................................................................................................................................... Infrastructure Cost ........................................................................................................................................................................ Program Overhead ....................................................................................................................................................................... Agency Overhead ......................................................................................................................................................................... FY 2006 Inflation (2.1%) = [Costs excluding infrastructure and payroll] x .021 .......................................................................... FY 2007 Inflation (2.2%) = [Costs excluding infrastructure and payroll] x .022 .......................................................................... FY 2008 Inflation (2.1%) = [Costs excluding infrastructure and payroll] x .021 .......................................................................... FY 2009 Inflation (2.1%) = [Costs excluding infrastructure and payroll] x .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 Federal holiday or a designated day for the Federal holiday. The Agency must 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 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 VerDate Aug<31>2005 15:49 Mar 29, 2007 Jkt 211001 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 PO 00000 Frm 00006 Fmt 4700 Sfmt 4700 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. E:\FR\FM\30MRR1.SGM 30MRR1 Federal Register / Vol. 72, No. 61 / Friday, March 30, 2007 / Rules and Regulations Accordingly, § 91.42 will be updated to reflect these changes. The regulations also are updated to identify current facility addresses. This rule will 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. cprice-sewell on PROD1PC66 with RULES Proposed Rule and Comments AMS published a proposed rule on September 22, 2006 (71 FR 55369), stating that it was proposing changing fees for laboratory services for FYs 2007 through 2009. AMS provided for a 30 day comment period, ending October 23, 2006. AMS received no comments. Executive Order 12866, Regulatory Flexibility Act, and Paperwork Reduction Act This 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 new 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. 604, AMS has prepared a final Regulatory Flexibility Analysis for this rule. 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 rulemaking action, an examination of alternative approaches, and an economic analysis of the benefits and costs. Need for the Rule The AMS laboratory testing programs are voluntary, user fee services conducted under the authority of the VerDate Aug<31>2005 15:49 Mar 29, 2007 Jkt 211001 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) will 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 costs for fiscal year 2006 were projected at $6,602,000 and revenues were projected at $5,834,000 for a deficit of $768,000. With this 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 rate increase were considered by the Agency. One alternative to this 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 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 PO 00000 Frm 00007 Fmt 4700 Sfmt 4700 15017 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 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 rule AMS will 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 having a three year fee increase instead of a single year fee increase, the Agency will help ensure that the fee increases are effective at the beginning of each fiscal year on October 1. An increase over three fiscal years will 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 January 1, 2007 for the fiscal year 2007 user fees. There are essentially three rate increases being changed 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 $89 or 4.7 percent in fiscal years 2007, 2008, and 2009, respectively. This is a voluntary program and the costs to each user would be proportional to their use of E:\FR\FM\30MRR1.SGM 30MRR1 15018 Federal Register / Vol. 72, No. 61 / Friday, March 30, 2007 / Rules and Regulations laboratory services each year. The increased fees will cover inflation and national and locality pay raises and replacement of equipment and other infrastructure improvements. Under the Regulatory Flexibility Act, the impact of this rule on small businesses must be analyzed. There are 811 current users of AMS laboratory testing services. Such users of services include food processors, handlers, growers, Federal and State government agencies, and exporters. Many of these users are small entities under the criteria established by the Small Business Administration (13 CFR 121.201). Any decision by stakeholders and customers to discontinue the use of the laboratory services because of increased fees would not hinder food processors or other industry members from marketing their products. For the following cost analysis, certain assumptions are used. First, base year data is actual fiscal year 2006 amount billed for voluntary services performed for the public. Second, seven percent of the total amount billed represents overtime costs and five percent represents costs related to appeals. Third, the calculated amounts in fiscal year 2007 are using the base year data as if the base year was fiscal year 2006. Fourth, each of the 811 customers had the exact same tests, using the same amount of time, and thus were billed the exact same amount. This customer is the ‘‘average’’ laboratory customer. Table 14 sets the total levels for the dollar ($) 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 Total Diff.1 FY 2009 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 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 $852 for all laboratory services. This is a 44.96 percent increase over the base year. The percentage increase for the basic laboratory services is 49.0 percent, overtime is 15.8 percent, and an appeal sample is 15.8 percent. TABLE 16.—COSTS ($) FOR A ‘‘LARGE BUSINESS’’ CUSTOMER, BASE YEAR THROUGH FISCAL YEAR (FY) 2009 Base total FY 2007 FY 2008 Total Diff. 1 FY 2009 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 cprice-sewell on PROD1PC66 with RULES Base year FY 2007 FY 2008 FY 2009 Total Diff. 1 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 1 Net difference calculated between costs in dollars ($) between base year and FY 2009. VerDate Aug<31>2005 15:49 Mar 29, 2007 Jkt 211001 PO 00000 Frm 00008 Fmt 4700 Sfmt 4700 E:\FR\FM\30MRR1.SGM 30MRR1 Federal Register / Vol. 72, No. 61 / Friday, March 30, 2007 / Rules and Regulations cprice-sewell on PROD1PC66 with RULES Under the Regulatory Flexibility Act, the impact of this rule on small businesses must be considered. The Agency estimates that 25 percent of the laboratory fees billed in fiscal year 2006 was to small businesses. Thus, a total of $384,172 was billed to small businesses. If the entire 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 anticipated 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 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 any one year. When such a VerDate Aug<31>2005 15:49 Mar 29, 2007 Jkt 211001 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 any one year. Thus, this rule is not subject to the requirements of section 202 and 205 of UMRA. Civil Justice Reform (Executive Order 12988) This rule has been reviewed under Executive Order 12988, Civil Justice Reform. It is not intended to have retroactive effect. This rule does 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, 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 rule does not require affected entities to relocate or alter their operations in ways that could adversely affect such persons or groups. Further, this rule does not deny any persons or groups the benefits of the program or subject any persons or groups to discrimination. AMS has reviewed this rule in accordance with the Department Regulation 4300–4,‘‘Civil Rights Impact Analysis.’’ AMS has determined this action ensures the civil rights of all Science and Technology Programs applicants and customers. They PO 00000 Frm 00009 Fmt 4700 Sfmt 4700 15019 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 (300.2 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 and Effective Date A thirty day comment period was provided for interested persons to comment on the proposed rule published in Federal Register (71 FR 55369) regarding changes in user fees for voluntary laboratory testing services. No comments were received by the end of the comment period on October 23, 2006. The existing fee schedules have been in place since October 2000. AMS regularly reviews its user-fee-supported programs to determine if the fees are adequate to cover expenses. The agency is unable to recover the full cost of its laboratory testing services. With this regulation, AMS is providing for three annual hourly fee rate increases for fiscal years 2007–2009. Accordingly, for these reasons, pursuant to 5 U.S.C. 553, it is found and determined that good cause exists for not postponing the effective date of this rule until 30 days after publication in the Federal Register. Therefore, this final rule is effective one day after the date of publication in the Federal Register. List of Subjects 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. I For the reasons set forth in the preamble, the Agricultural Marketing Service amends part 91 and under the authority of 7 U.S.C. 1622, 1624 removes part 92 of Title 7, chapter I, subchapter E, of the Code of Federal Regulations as follows: PART 91—SERVICES AND GENERAL INFORMATION 1. The authority citation part 91 continues to read as follows: I Authority: 7 U.S.C. 1622, 1624. 2. Section 91.5 is revised to read as follows: I E:\FR\FM\30MRR1.SGM 30MRR1 15020 cprice-sewell on PROD1PC66 with RULES § 91.5 Federal Register / Vol. 72, No. 61 / Friday, March 30, 2007 / Rules and Regulations 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, Blakely, 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 VerDate Aug<31>2005 15:49 Mar 29, 2007 Jkt 211001 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 follows: 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 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 PO 00000 Frm 00010 Fmt 4700 Sfmt 4700 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, 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. I 3. Section 91.37 is 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 E:\FR\FM\30MRR1.SGM 30MRR1 Federal Register / Vol. 72, No. 61 / Friday, March 30, 2007 / Rules and Regulations 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 will be charged a fee on a reimbursable cost to AMS basis. I 4. Section 91.38 is revised to read as follows: 6. Section 91.42 is revised to read as follows: I § 91.42 Billing. (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. I 5. Section 91.39 is revised to read as follows: (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 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. § 91.39 Premium hourly fee rates for overtime and legal holiday service. PART 92—[REMOVED AND RESERVED] (a) When analytical testing in a Science and Technology facility I § 91.38 Additional fees for appeal of analysis. cprice-sewell on PROD1PC66 with RULES 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. VerDate Aug<31>2005 15:49 Mar 29, 2007 Jkt 211001 7. Part 92 is removed and reserved. PO 00000 Frm 00011 Fmt 4700 Sfmt 4700 15021 Dated: March 23, 2007. Lloyd C. Day, Administrator, Agricultural Marketing Service. [FR Doc. E7–5787 Filed 3–29–07; 8:45 am] BILLING CODE 3410–02–P DEPARTMENT OF AGRICULTURE Agricultural Marketing Service 7 CFR Part 981 [Docket No. FV06–981–1 FR] Almonds Grown in California; Outgoing Quality Control Requirements Agricultural Marketing Service, USDA. ACTION: Final rule. AGENCY: SUMMARY: This rule adds outgoing quality control requirements under the administrative rules and regulations of the California almond marketing order (order). The order regulates the handling of almonds grown in California and is administered locally by the Almond Board of California (Board). This rule provides for a mandatory program under the order to reduce the potential for Salmonella bacteria in almonds. This action will help ensure that quality almonds are available for human consumption. DATES: This rule is effective on March 31, 2007. Handler treatment plans for the 2007–08 crop year must be submitted by May 31, 2007. Mandatory compliance with this rule begins September 1, 2007. FOR FURTHER INFORMATION CONTACT: Maureen T. Pello, Assistant Regional Manager, or Kurt J. Kimmel, Regional Manager, California Marketing Field Office, Marketing Order Administration Branch, Fruit and Vegetable Programs, AMS, USDA, Telephone: (559) 487– 5901, Fax: (559) 487–5906, or E-mail: Maureen.Pello@usda.gov, or Kurt.Kimmel@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. This final rule is issued under Marketing Order No. 981, as amended (7 CFR part 981), regulating the handling of almonds grown in California, hereinafter referred SUPPLEMENTARY INFORMATION: E:\FR\FM\30MRR1.SGM 30MRR1

Agencies

[Federal Register Volume 72, Number 61 (Friday, March 30, 2007)]
[Rules and Regulations]
[Pages 15011-15021]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-5787]



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Rules and Regulations
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Federal Register / Vol. 72, No. 61 / Friday, March 30, 2007 / Rules 
and Regulations

[[Page 15011]]



DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Parts 91 and 92

[Docket Number: AMS-ST-07-0045: 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: Final rule.

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

SUMMARY: The Agricultural Marketing Service (AMS) is changing the 
hourly fee rates for Science and Technology (S&T) Laboratory Services. 
The agency is raising 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 regulation, AMS is providing for three annual 
standard hourly fee rate increases for fiscal years 2007-2009. This 
will provide the agricultural commodity industries and other 
stakeholders with more timely and relevant information regarding user 
fees for voluntary laboratory testing services. The agency is also 
removing tables and schedules with listings of individual tests and 
services. Three annual hourly fee rate adjustments are established by 
this action for appeals, holiday, and overtime services to reflect the 
anticipated increase 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: Effective March 31, 2007.

FOR FURTHER INFORMATION CONTACT: 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.

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 will be 
$60.00 per hour for the remainder of fiscal year 2007, and will 
increase to $63.00 per hour in fiscal year 2008, and $67.00 per hour in 
fiscal year 2009. The premium hourly fee rates will 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 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.
    With this rulemaking, AMS will amend its regulations to provide for 
annual hourly fee rate increases for laboratory services over three 
years (FYs 2007 through 2009) in one action. AMS will continue to 
perform a yearly cost analysis to determine whether the voluntary 
hourly fee rates established for its user-fee-supported laboratory 
service programs 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 established 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 will 
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 will 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 new hourly fee rates will recover these 
costs, and none of the fees collected for testing services referenced 
in this final rule are used for a biotechnology verification program 
specified in Federal Register Notice (67 FR 50853), August 6, 2002.

[[Page 15012]]

    AMS calculated its actual costs for fiscal years 2001 through 2006 
and its projected increases in salaries and inflation in fiscal years 
2007 through 2009. The 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 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, only 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 New Hourly Fee Rates (Per Hour) by Type of Service
----------------------------------------------------------------------------------------------------------------
                                                                   FY 2007 rate    FY 2008 rate    FY 2009 rate
                     Service                       Current rate         \1\             \2\             \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 action, the AMS will amend its regulations to provide for 
three annual fee increases in one action. Table 1 shows the summary of 
the current rates and the new 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 Cost \5\.............................            8.78
    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

[[Page 15013]]

 
    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.................
                                                         ---------------
        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.

[[Page 15014]]



   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............
    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)           $33.65
     + FY 2008 Pay Adjustment ($0.48)] x 1.5............
    FY 2009 Pay Adjustment = FY 2008 Salaries @ 1.5 x               0.74
     0.022..............................................
    Benefits............................................            6.90
    Operational Costs...................................           11.60
    Infrastructure Cost.................................           16.15
    Program Overhead....................................            3.44
    Agency Overhead.....................................            3.28

[[Page 15015]]

 
    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............................................            6.90
    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-Holidays....................           77.49
------------------------------------------------------------------------


     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.................

[[Page 15016]]

 
    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 must 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 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.

[[Page 15017]]

Accordingly, Sec.  91.42 will be updated to reflect these changes. The 
regulations also are updated to identify current facility addresses.
    This rule will 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.

Proposed Rule and Comments

    AMS published a proposed rule on September 22, 2006 (71 FR 55369), 
stating that it was proposing changing fees for laboratory services for 
FYs 2007 through 2009. AMS provided for a 30 day comment period, ending 
October 23, 2006. AMS received no comments.

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

    This 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 new 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. 604, AMS has prepared a final Regulatory Flexibility 
Analysis for this rule.
    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 rulemaking action, an examination of alternative 
approaches, and an economic analysis of the benefits and costs.

Need for the Rule

    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) will 
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 costs for fiscal year 2006 were projected at 
$6,602,000 and revenues were projected at $5,834,000 for a deficit of 
$768,000. With this 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 rate increase were considered by the Agency. 
One alternative to this 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 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 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 rule AMS will 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 having a three year fee increase instead of a single 
year fee increase, the Agency will help ensure that the fee increases 
are effective at the beginning of each fiscal year on October 1. An 
increase over three fiscal years will 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 January 1, 2007 for the fiscal 
year 2007 user fees. There are essentially three rate increases being 
changed 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

[[Page 15018]]

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 of this 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 2006 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.

         Table 16.--Costs ($) for a ``Large Business'' Customer, Base Year Through Fiscal Year (FY) 2009
----------------------------------------------------------------------------------------------------------------
                                                                                                    Total Diff.
                                    Base total        FY 2007         FY 2008         FY 2009           \1\
----------------------------------------------------------------------------------------------------------------
Lab Services....................         704,000         938,432         985,354       1,048,417         344,417
Overtime........................          56,000          58,912          61,386          64,701           8,701
Appeals.........................          40,000          42,080          43,847          46,215           6,215
                                 -------------------------------------------------------------------------------
        Total...................         800,000       1,039,424       1,090,587       1,159,333        359,333
----------------------------------------------------------------------------------------------------------------
\1\ Net difference calculated between costs in dollars ($) 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 ($) for a ``Small Business'' Customer, Base Year Through Fiscal Year (FY) 2009
----------------------------------------------------------------------------------------------------------------
                                                                                                         Total
                                                           Base year   FY 2007    FY 2008    FY 2009   Diff. \1\
----------------------------------------------------------------------------------------------------------------
Lab Services.............................................     25,520     34,018     35,719     38,005     12,485
Overtime.................................................      2,030      2,136      2,226      2,346        316
Appeals..................................................      1,450      1,525      1,589      1,675        225
                                                          ------------------------------------------------------
        Total............................................     29,000     37,679     39,534     42,026    13,026
----------------------------------------------------------------------------------------------------------------
\1\ Net difference calculated between costs in dollars ($) between base year and FY 2009.


[[Page 15019]]

    Under the Regulatory Flexibility Act, the impact of this rule on 
small businesses must be considered. The Agency estimates that 25 
percent of the laboratory fees billed in fiscal year 2006 was to small 
businesses. Thus, a total of $384,172 was billed to small businesses. 
If the entire 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 anticipated 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 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 any one 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 any one year. Thus, this rule is not subject to the requirements of 
section 202 and 205 of UMRA.

Civil Justice Reform (Executive Order 12988)

    This rule has been reviewed under Executive Order 12988, Civil 
Justice Reform. It is not intended to have retroactive effect. This 
rule does 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, 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 rule does not require affected entities to relocate or alter 
their operations in ways that could adversely affect such persons or 
groups. Further, this rule does not deny any persons or groups the 
benefits of the program or subject any persons or groups to 
discrimination.
    AMS has reviewed this rule in accordance with the Department 
Regulation 4300-4,``Civil Rights Impact Analysis.'' AMS has determined 
this 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 (300.2 
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 and Effective Date

    A thirty day comment period was provided for interested persons to 
comment on the proposed rule published in Federal Register (71 FR 
55369) regarding changes in user fees for voluntary laboratory testing 
services. No comments were received by the end of the comment period on 
October 23, 2006. The existing fee schedules have been in place since 
October 2000. AMS regularly reviews its user-fee-supported programs to 
determine if the fees are adequate to cover expenses. The agency is 
unable to recover the full cost of its laboratory testing services. 
With this regulation, AMS is providing for three annual hourly fee rate 
increases for fiscal years 2007-2009. Accordingly, for these reasons, 
pursuant to 5 U.S.C. 553, it is found and determined that good cause 
exists for not postponing the effective date of this rule until 30 days 
after publication in the Federal Register. Therefore, this final rule 
is effective one day after the date of publication in the Federal 
Register.

List of Subjects

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.

0
For the reasons set forth in the preamble, the Agricultural Marketing 
Service amends part 91 and under the authority of 7 U.S.C. 1622, 1624 
removes part 92 of Title 7, chapter I, subchapter E, of the Code of 
Federal Regulations as follows:

PART 91--SERVICES AND GENERAL INFORMATION

0
1. The authority citation part 91 continues to read as follows:

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

0
2. Section 91.5 is revised to read as follows:

[[Page 15020]]

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, 
Blakely, 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 follows: 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 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
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