Multi-Year Revision of Fees for the Fresh Fruit and Vegetable Terminal Market Inspection Services, 41885-41888 [E7-14826]

Download as PDF 41885 Rules and Regulations Federal Register Vol. 72, No. 147 Wednesday, August 1, 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 Part 51 [Docket #AMS–FV–07–0099; FV–06–308] RIN 0581–AC63 Multi-Year Revision of Fees for the Fresh Fruit and Vegetable Terminal Market Inspection Services AGENCY: Agricultural Marketing Service, USDA. ACTION: Final rule. SUMMARY: This rule would revise the regulations governing the inspection and certification for fresh fruits, vegetables and other products by increasing certain fees charged for the inspection of these products at destination markets for the next two fiscal years (FY–2007 and FY–2008) by approximately 15 percent each fiscal year. This rule would increase fees 30 days after publication in FY–2007 and again in March 2008. These revisions are necessary in order to recover, as nearly as practicable, the costs of performing inspection services at destination markets under the Agricultural Marketing Act of 1946 (AMA of 1946). The fees charged to persons required to have inspection on imported commodities in accordance with the Agricultural Marketing Agreement Act of 1937 and for imported peanuts under section 1308 of the Farm Security and Rural Investigation Act of 2002. sroberts on PROD1PC70 with RULES DATES: Effective Date: August 31, 2007. Rita Bibbs-Booth, USDA, 1400 Independence Ave., SW, Room 0640–S, Washington, DC 20250–0295, or call (202) 720–0391. FOR FURTHER CONTACT INFORMATION: SUPPLEMENTARY INFORMATION: VerDate Aug<31>2005 15:44 Jul 31, 2007 Jkt 211001 Executive Order 12866 and Regulatory Flexibility Act This rule has been determined to be ‘‘non-significant’’ for the purposes of Executive Order 12866 and therefore has not been reviewed by the Office of Management and Budget. Also, pursuant to the requirement set forth in the Regulatory Flexibility Act (RFA), AMS has considered the economic impact of this action on small entities. Accordingly, AMS proposes this initial regulatory flexibility analysis. The purpose of the RFA is to fit regulatory actions to the scale of businesses subject to such actions in order that small businesses will not be unduly or disproportionately burdened. The action described herein is being taken for several reasons, including that additional user fee revenues are needed to cover the costs for: (1) Providing current program operations and services; (2) improving the timeliness in which inspection services are provided; and (3) improving the work environment. AMS regularly reviews its user-fee financed programs to determine if the fees are adequate. The Fresh Products Branch (FPB) has and will continue to seek out cost saving opportunities and implement appropriate changes to reduce its costs. Such actions can provide alternatives to fee increases. FPB has reduced costs by approximately $2 million. However, even with these efforts, FPB’s existing fee schedule will not generate sufficient revenue to cover program costs while maintaining the Agency mandated reserve balance. Revenue projections for FPB’s destination market inspection work during FY–2006 are $15.3 million with costs projected at $20.4 million and an end-of-year reserve balance of approximately $12.7 million. However, this reserve balance is due in part, to appropriated funding received in October 2001, for infrastructure, workplace, and technological improvements. FPB’s costs of operating the destination market program are expected to increase to approximately $21.6 million during FY–2007 and $22.5 million during FY–2008. Revenues are projected to be $15.3 million for end of the fiscal year. The reserve balance for FY–2007 and FY–2008, will fall below the Agency’s mandated four-month reserve level. The reserve balance is PO 00000 Frm 00001 Fmt 4700 Sfmt 4700 projected to be approximately $6.5 million for FY–2007 (3.6 months) and approximately negative $600,000 for FY–2008 (¥0.3 months). This fee increase should result in an estimated average of $2.4 million in additional revenues per year (effective in FY–2007, if the fees were implemented by October 1, 2006). However, fees would not be increased until later in FY–2007. Further, as a result, the next fee increase is delayed until March 2008 instead of the start of FY–2008. These increases will not cover all of FPB’s costs. FPB will need to continue to increase fees in order to cover the program’s operating cost and maintain the required reserve balance. FPB believes that increasing fees incrementally is appropriate at this time. Additional fee increases beyond FY–2008 will be needed to sustain the program in the future. However, we will continue to reduce costs, wherever possible. Employee salaries and benefits are major program costs that account for approximately 80 percent of FPB’s total operating budget. A general and locality salary increase for Federal employees, ranging from 2.87 to 5.62 percent depending on locality, effective January 2006, has significantly increased program costs and will continue to increase costs at a similar rate in future years. This salary adjustment will increase FPB’s costs by over $700,000 per year. Increases in health and life insurance premiums, along with workers compensation will also increase program costs. In addition, inflation also impacts FPB’s non-salary costs. These factors have increased FPB’s costs of operating this program by over $600,000 per year. Additional funds are necessary in order for FPB to continue to cover the costs associated with additional staff and to maintain office space and equipment. Additional revenues are also necessary to improve the work environment by providing training and purchasing needed equipment. In addition, FPB began in 2001, developing (with appropriated funds) the Fresh Electronic Inspection Reporting/ Resource System (FEIRS) to replace its manual paper and pen inspection reporting process. FEIRS was implemented in 2004. This system has been put in place to enhance and streamline FPB’s fruit and vegetable E:\FR\FM\01AUR1.SGM 01AUR1 41886 Federal Register / Vol. 72, No. 147 / Wednesday, August 1, 2007 / Rules and Regulations sroberts on PROD1PC70 with RULES inspection process, however additional revenue is required to maintain FEIRS. FPB has also begun to cover the costs associated with the Training and Development Center (TDC) in Fredericksburg, VA. A portion of the appropriated funds received in October 2001, were for infrastructure improvements including the development and maintenance of the inspector TDC. With appropriated funding now depleted, FPB is now obligated to support the TDC under revenues from the terminal market user fee inspection program. This rule should increase user fee revenue generated under the destination market program by approximately 15 percent each fiscal year. This action is authorized under the Agricultural Marketing Act of 1946 (AMA of 1946) (See 7 U.S.C. 1622(h)), which provides that the Secretary of Agriculture may assess and collect ‘‘such fees as will be reasonable and as nearly as may be to cover the costs of services rendered * * *’’ There are more than 2,000 users of FPB’s destination market grading services (including applicants who must meet import requirements 1— inspections which amount to under 2.5 percent of all lot inspections performed). A small portion of these users are small entities under the criteria established by the Small Business Administration (13 CFR 121.201). There would be no additional reporting, recordkeeping, or other compliance requirements imposed upon small entities as a result of this rule. In compliance with the Paperwork Reduction Act of 1995 (44 U.S.C. Chapter 35), the information collection and recordkeeping requirements in Part 51 have been approved previously by OMB and assigned OMB No. 0581– 0125. FPB has not identified any other Federal rules which may duplicate, 1 Section 8e of the Agricultural Marketing Agreement Act of 1937, as amended (7 U.S.C. 601– 674), requires that whenever the Secretary of Agriculture issues grade, size, quality or maturity regulations under domestic marketing orders for certain commodities, the same or comparable regulations on imports of those commodities must be issued. Import regulations apply during those periods when domestic marketing order regulations are in effect. Section 1308 of the Farm Security and Rural Investment Act of 2002 (Pub. L. 107–171), 7 U.S.C. 7958, required USDA among other things to develop new peanut quality and handling standards for imported peanuts marketing in the United States. Currently, there are 14 commodities subject to 8e import regulations: Avocados, dates (other than dates for processing), filberts, grapefruit, kiwifruit, olives (other than Spanish-style green olives), onions, oranges, potatoes, prunes, raisins, table grapes, tomatoes and walnuts. A current listing of the regulated commodities can be found under 7 CFR Parts 944, 980, 996 and 999. VerDate Aug<31>2005 15:44 Jul 31, 2007 Jkt 211001 overlap or conflict with this proposed rule. The destination market grading services are voluntary (except when required for imported commodities) and the fees charged to users of these services vary with usage. The impact on all businesses, including small entities, is very similar. However, except for those persons who are required to obtain inspections, most of these businesses are typically under no obligation to use these inspection services, and, therefore, any decision on their part to discontinue the use of the services should not prevent them from marketing their products. Further, even though fees will be raised, the increase is not excessive and should not significantly affect these entities. Executive Order 12988 This rule has been reviewed under Executive Order 12988, Civil Justice Reform. This action is not intended to have retroactive effect. This rule will not preempt any State or local laws, regulations 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 the provisions of this rule. Action The AMA of 1946 authorizes official inspection, grading, and certification, on a user-fee basis, of fresh fruits, vegetables and other products such as raw nuts, Christmas trees and flowers. The AMA of 1946 provides that reasonable fees be collected from the users of the services to cover, as nearly as practicable, the cost of the services rendered. This rule would amend the schedule for fees and charges for inspection services rendered to the fresh fruit and vegetable industry to reflect the costs necessary to operate the program. AMS regularly reviews its user-fee financed programs to determine if the fees are adequate. The Fresh Products Branch (FPB) has and will continue to seek out cost saving opportunities and implement appropriate changes to reduce its costs. Such actions can provide alternatives to fee increases. FPB has reduced costs by approximately $2 million. However, even with these efforts, FPB’s existing fee schedule will not generate sufficient revenue to cover program costs while maintaining the Agency mandated reserve balance. Revenue projections for FPB’s destination market inspection work during FY–2006 are $15.3 million with costs projected at $20.4 million and an end-of-year reserve balance of PO 00000 Frm 00002 Fmt 4700 Sfmt 4700 approximately $12.7 million. However, this reserve balance is due in part, to appropriated funding received in October 2001, for infrastructure, workplace, and technological improvements. FPB’s costs of operating the destination market program are expected to increase to approximately $21.6 million during FY–2007 and $22.5 million during FY–2008. Revenues are projected to be $15.3 million for end of the fiscal year. The reserve balance for FY–2007 and FY–2008, will fall below the Agency’s mandated four-month reserve level. The reserve balance is projected to be approximately $6.5 million for FY–2007 (3.6 months) and a negative $584,000 for FY–2008 (¥0.3 months). Employee salaries and benefits are major program costs that account for approximately 80 percent of FPB’s total operating budget. A general and locality salary increase for Federal employees, ranging from 2.87 to 5.62 percent depending on locality, effective January 2006, has significantly increased program costs, and will continue to increase costs at a similar rate in future years. This salary adjustment will increase FPB’s costs by over $700,000 per year. Increases in health and life insurance premiums, along with workers compensation will also increase program costs. In addition, inflation also impacts FPB’s non-costs. These factors have increased FPB’s costs of operating this program by over $600,000 per year. Additional revenues are necessary in order for FPB to continue to cover the costs associated with additional staff and to maintain office space and equipment. Additional revenues are also necessary to continue to improve the work environment by providing training and purchasing needed equipment. In addition, FPB began in 2001, developing (with appropriated funds) an automated system known as FEIRS, to replace its manual paper and pen inspection reporting process. Approximately $10,000 in additional revenue per month will be needed to maintain the system. This system has been put in place to enhance FPB’s fruit and vegetable inspection processes. FPB has also begun to cover the costs associated with the TDC in Fredericksburg, VA. A portion of the appropriated funds received in October 2001, were for infrastructure improvements including the development and maintenance of the inspector TDC. With appropriated funding now depleted, FPB is now obligated to support the TDC under revenues from the terminal market user fee inspection program. Based on the aforementioned analysis of this program’s increasing costs, AMS E:\FR\FM\01AUR1.SGM 01AUR1 Federal Register / Vol. 72, No. 147 / Wednesday, August 1, 2007 / Rules and Regulations will increase the fees for destination market inspection services. The following table compares current fees and charges with the proposed fees and charges for fresh fruit and vegetable inspection as found in 7 CFR 51.38. Unless otherwise provided for by regulation or written agreement between Service 1In 2007 2008 $114.00 95.00 52.00 $131.00 109.00 60.00 $151.00 125.00 69.00 95.00 87.00 52.00 109.00 100.00 60.00 125.00 115.00 69.00 52.00 52.00 60.00 60.00 69.00 69.00 12.9 13.3 13.8 14.4 15.1 114.00 52.00 131.00 60.00 15.9 151.00 69.00 56.00 64.00 74.00 29.00 29.00 33.00 66.00 38.00 74.00 56.00 1.00 64.00 1.15 74.00 1.32 cents. A notice of proposed rulemaking was published in the Federal Register on December 1, 2006, (71 FR 69497). FPB received one comment after the comment period closed. As previously stated, because the FY– 2007 fee increase in effect in the latter part of the fiscal year, AMS is changing the effective date of the FY–2008 fee increase to March 1, 2008, to provide a sufficient amount of time between the two fee increases. Finally, the regulatory text in the proposed section 51.38(e) is corrected to reflect separate fees for overtime and holiday note that appeared in the supplementary information section of the proposed rule. List of Subjects in 7 CFR Part 51 Agricultural commodities, Food grades and standards, Fruits, Nuts, Reporting and recordkeeping requirements, Trees, Vegetables. I For reasons set forth in the preamble, 7 CFR Part 51 is amended as follows: sroberts on PROD1PC70 with RULES the applicant and the Administrator, the changes in the schedule of fees as found in § 51.38 are: Current Quality and condition inspections of products each in quantities of 51 or more packages and unloaded from the same land or air conveyance: • Over a half carlot equivalent of each product ............................................................ • Half carlot equivalent or less of each product ............................................................ • For each additional lot of the same product ............................................................... Condition only inspections of products each in quantities of 51 or more packages and unloaded from the same land or air conveyance: • Over a half carlot equivalent of each product ............................................................ • Half carlot equivalent or less of each product ............................................................ • For each additional lot of the same product ............................................................... Quality and condition and condition only inspections of products each in quantities of 50 or less packages unloaded from the same land or air conveyance: • For each product ......................................................................................................... • For each additional lot of any of the same product ................................................... Lots in excess of carlot equivalents will be charged proportionally by the quarter carlot.. Dock side inspections of an individual product unloaded directly from the same ship:. • For each package weighing less than 30 pounds ...................................................... • For each package weighing 30 or more pounds ........................................................ • Minimum charge per individual product ...................................................................... • Minimum charge for each additional lot of the same product .................................... Hourly rate for inspections performed for other purposes during the grader’s regularly scheduled work week: • Hourly rate for non-carlot equivalent inspections such as count, size, temperature, container, etc. or work associated with inspections such as digital image services will be charged at a rate that reflects the cost of providing the service .................... Overtime rate (per hour additional) for all inspections performed outside the grader’s regularly scheduled work week ............................................................................................... Holiday pay ............................................................................................................................ Hourly rate for inspections performed under 40 hour contracts during the grader’s regularly scheduled work week ................................................................................................. Rate for billable mileage ........................................................................................................ 41887 PART 51—[AMENDED] 1. The authority citation for 7 CFR Part 51 continues to read as follows: I Authority: 7 U.S.C. 1621–1627. VerDate Aug<31>2005 15:44 Jul 31, 2007 Jkt 211001 2. Section 51.38 is revised to read as follows: I § 51.38 Basis for fees and rates. (a) When performing inspections of product unloaded directly from land or air transportation, the charges shall be determined on the following basis: (1) Quality and condition inspections of products in quantities of 51 or more packages and unloaded from the same air or land conveyance: (i) $131 ($151, on or after March 1, 2008) for over a half carlot equivalent of an individual product; (ii) $109 ($125, on or after March 1, 2008) for a half carlot equivalent or less of an individual product; (iii) $60 ($69, on or after March 1, 2008) for each additional lot of the same product. (2) Condition only inspection of products each in quantities of 51 or more packages and unloaded from the same land or air conveyance: (i) $109 ($125, on or after March 1, 2008) for over a half carlot equivalent of an individual product; (ii) $100 ($115, on or after March 1, 2008) for a half carlot equivalent or less of an individual product; PO 00000 Frm 00003 Fmt 4700 Sfmt 4700 (iii) $60 ($69, on or after March 1, 2008) for each additional lot of the same product. (3) For quality and condition inspection and condition only inspection of products in quantities of 50 or less packages unloaded from the same conveyance: (i) $60 ($69, on or after March 1, 2008) for each individual product: (ii) $60 ($69, on or after March 1, 2008) for each additional lot of any of the same product. Lots in excess of carlot equivalents will be charged proportionally by the quarter carlot. (b) When performing inspections of palletized products unloaded directly from sea transportation or when palletized product is first offered for inspection before being transported from the dock-side facility, charges shall be determined on the following basis: (1) Dock side inspections of an individual product unloaded directly from the same ship: (i) 3.3 (3.8, on or after March 1, 2008) cents per package weighing less than 30 pounds; (ii) 5.1 (5.9, on or after March 1, 2008) cents per package weighing 30 or more pounds; E:\FR\FM\01AUR1.SGM 01AUR1 sroberts on PROD1PC70 with RULES 41888 Federal Register / Vol. 72, No. 147 / Wednesday, August 1, 2007 / Rules and Regulations (iii) Minimum charge of $131 ($151, on or after March 1, 2008) per individual product; (iv) Minimum charge of $60 ($69, on or after March l, 2008) for each additional lot of the same product. (2) [RESERVED] (c) When performing inspections of products from sea containers unloaded directly from sea transportation or when palletized products unloaded directly from sea transportation are not offered for inspection at dock-side, the carlot fees in ‘‘a’’ of this section shall apply. (d) When performing inspections for Government agencies, or for purposes other than those prescribed in paragraphs (a) through (c) of this section, including weight-only and freezing-only inspections, fees for inspections shall be based on the time consumed by the grader in connection with such inspections, computed at a rate of $64 ($74, on or after March 1, 2008) per hour; Provided, that: (1) Charges for time shall be rounded to the nearest half hour; (2) The minimum fee shall be two hours for weight-only inspections, and one-half hour for other inspections; (3) When weight certification is provided in addition to quality and/or condition inspection, a one hour charge shall be added to the carlot fee; (4) When inspections are performed to certify product compliance for Defense Personnel Support Centers, the daily or weekly charge shall be determined by multiplying the total hours consumed to conduct inspections by the hourly rate. The daily or weekly charge shall be prorated among applicants by multiplying the daily or weekly charge by the percentage of product passed and/or failed for each applicant during that day or week. Waiting time and overtime charges shall be charged directly to the applicant responsible for their incurrence. (e) When performing inspections at the request of the applicant during periods which are outside the grader’s regularly scheduled work week, a charge for overtime or holiday work shall be made at the rate of $33 for overtime and $66 for holiday work ($38 for overtime and $74 for holiday work, on or after March 1, 2008) per hour or portion thereof in addition to the carlot equivalent fee, package charge, or hourly charge specified in this subpart. Overtime or holiday charges for time shall be rounded to the nearest half hour. (f) When an inspection is delayed because product is not available or readily accessible, a charge for waiting time shall be made at the prevailing VerDate Aug<31>2005 15:44 Jul 31, 2007 Jkt 211001 hourly rate in addition to the carlot equivalent fee, package charge, or hourly charge specified in this subpart. Waiting time shall be rounded to the nearest half hour. Dated: July 26, 2007. Lloyd C. Day, Administrator, Agricultural Marketing Service. [FR Doc. E7–14826 Filed 7–31–07; 8:45 am] BILLING CODE 3410–02–P DEPARTMENT OF HOMELAND SECURITY U.S. Citizenship and Immigration Services 8 CFR Part 103 [CIS No. 2415–07; Docket No. USCIS–2007– 0039] RIN 1615–AB60 Temporary Adjustment of the Immigration and Naturalization Benefit Application and Petition Fee Schedule for Certain Adjustment of Status and Related Applications U.S. Citizenship and Immigration Services, DHS. ACTION: Final rule. AGENCY: This rule temporarily amends the applicable fees for employmentbased Forms I–485, ‘‘Application to Register Permanent Residence or Adjust Status,’’ and applications for derivative benefits associated with such Forms I– 485 filed pursuant to the Department of State’s July Visa Bulletin No. 107, dated June 12, 2007. The fees for all other petitions and applications administered by U.S. Citizenship and Immigration Services will continue in force as effective on July 30, 2007. DATES: Effective Date: This rule is effective July 30, 2007, at 12:02 a.m. EST. SUMMARY: FOR FURTHER INFORMATION CONTACT: Efren Hernandez III, Business and Trade Services, Service Center Operations (Business and Trade Services), U.S. Citizenship and Immigration Services, Department of Homeland Security, 111 Massachusetts Avenue, Suite 3000, Washington, DC 20001, telephone (202) 272–8400. SUPPLEMENTARY INFORMATION: I. Background 1. USCIS Fee Schedule On May 30, 2007, USCIS published the final rule, effective July 30, 2007, ‘‘Adjustment of the Immigration and PO 00000 Frm 00004 Fmt 4700 Sfmt 4700 Naturalization Benefit Application and Petition Fee Schedule,’’ amending 8 CFR part 103 to prescribe new fees to fund the cost of processing applications and petitions for immigration and naturalization benefits and services, and USCIS’ associated operating costs pursuant to section 286(m) of the Immigration and Nationality Act (INA), 8 U.S.C. 1356(m). 72 FR 29851. That rule provides that applications that are submitted to USCIS with the incorrect fee will be rejected. For the reasons described below, USCIS, through this rule, is amending the fees again on a temporary basis for certain applications. This rule will become effective immediately after the final fee rule published on May 30, 2007, and makes only temporary modifications to that rule to respond to the events described below. The rule provides limited relief for specific applicants from the final fee rule published on May 30, 2007. The effect of this rule is limited to those applications filed before August 18, 2007. For applications filed on or after August 18, 2007, the fees set forth in the final rule published on May 30, 2007, will be required. USCIS will remove this regulation by another rule to be published in Federal Register on or about August 17, 2007, to be effective August 18, 2007. 2. Visa Availability—Summary The INA establishes formulas and numerical limits for regulating persons immigrating to the United States for permanent residence, to include defining the employment-based immigrant visa classifications. INA sec. 201 et seq., 8 U.S.C. 1151 et seq. The INA provides an annual world-wide numerical limit on the number of aliens who may immigrate to the United States, as well as an annual per-country numerical limit on the number of aliens who may emigrate from a particular country. INA sections 201(d) and 202(a)(2), 8 U.S.C. 1151(d) and 1152(a)(2). In addition, the INA allocates the total number of world-wide visas among five employment-based categories or preferences. INA sec. 203(b), 8 U.S.C. 1153(b). Taken together, the total number of visas, the country from which an alien emigrates, and the allocation of visas among the preference categories, determines whether a particular alien may immigrate to the United States at a certain date. The Department of State (DOS) determines the availability of immigrant visa numbers. See INA sections 203(e) and (g), 8 U.S.C. 1153(e) and (g). DOS also controls individual allocation of employment-based immigrant visas. 22 CFR 42.32. DOS publishes a ‘‘Visa E:\FR\FM\01AUR1.SGM 01AUR1

Agencies

[Federal Register Volume 72, Number 147 (Wednesday, August 1, 2007)]
[Rules and Regulations]
[Pages 41885-41888]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-14826]

========================================================================
Rules and Regulations
Federal Register
________________________________________________________________________

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.

========================================================================

Federal Register / Vol. 72, No. 147 / Wednesday, August 1, 2007 /
Rules and Regulations

[[Page 41885]]

DEPARTMENT OF AGRICULTURE

Agricultural Marketing Service

7 CFR Part 51

[Docket AMS-FV-07-0099; FV-06-308]
RIN 0581-AC63

Multi-Year Revision of Fees for the Fresh Fruit and Vegetable
Terminal Market Inspection Services

AGENCY: Agricultural Marketing Service, USDA.

ACTION: Final rule.

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

SUMMARY: This rule would revise the regulations governing the
inspection and certification for fresh fruits, vegetables and other
products by increasing certain fees charged for the inspection of these
products at destination markets for the next two fiscal years (FY-2007
and FY-2008) by approximately 15 percent each fiscal year. This rule
would increase fees 30 days after publication in FY-2007 and again in
March 2008. These revisions are necessary in order to recover, as
nearly as practicable, the costs of performing inspection services at
destination markets under the Agricultural Marketing Act of 1946 (AMA
of 1946). The fees charged to persons required to have inspection on
imported commodities in accordance with the Agricultural Marketing
Agreement Act of 1937 and for imported peanuts under section 1308 of
the Farm Security and Rural Investigation Act of 2002.

DATES: Effective Date: August 31, 2007.

FOR FURTHER CONTACT INFORMATION: Rita Bibbs-Booth, USDA, 1400
Independence Ave., SW, Room 0640-S, Washington, DC 20250-0295, or call
(202) 720-0391.

SUPPLEMENTARY INFORMATION:

Executive Order 12866 and Regulatory Flexibility Act

This rule has been determined to be ``non-significant'' for the
purposes of Executive Order 12866 and therefore has not been reviewed
by the Office of Management and Budget.
Also, pursuant to the requirement set forth in the Regulatory
Flexibility Act (RFA), AMS has considered the economic impact of this
action on small entities. Accordingly, AMS proposes this initial
regulatory flexibility analysis.
The purpose of the RFA is to fit regulatory actions to the scale of
businesses subject to such actions in order that small businesses will
not be unduly or disproportionately burdened. The action described
herein is being taken for several reasons, including that additional
user fee revenues are needed to cover the costs for: (1) Providing
current program operations and services; (2) improving the timeliness
in which inspection services are provided; and (3) improving the work
environment.
AMS regularly reviews its user-fee financed programs to determine
if the fees are adequate. The Fresh Products Branch (FPB) has and will
continue to seek out cost saving opportunities and implement
appropriate changes to reduce its costs. Such actions can provide
alternatives to fee increases. FPB has reduced costs by approximately
$2 million. However, even with these efforts, FPB's existing fee
schedule will not generate sufficient revenue to cover program costs
while maintaining the Agency mandated reserve balance. Revenue
projections for FPB's destination market inspection work during FY-2006
are $15.3 million with costs projected at $20.4 million and an end-of-
year reserve balance of approximately $12.7 million. However, this
reserve balance is due in part, to appropriated funding received in
October 2001, for infrastructure, workplace, and technological
improvements. FPB's costs of operating the destination market program
are expected to increase to approximately $21.6 million during FY-2007
and $22.5 million during FY-2008. Revenues are projected to be $15.3
million for end of the fiscal year. The reserve balance for FY-2007 and
FY-2008, will fall below the Agency's mandated four-month reserve
level. The reserve balance is projected to be approximately $6.5
million for FY-2007 (3.6 months) and approximately negative $600,000
for FY-2008 (-0.3 months).
This fee increase should result in an estimated average of $2.4
million in additional revenues per year (effective in FY-2007, if the
fees were implemented by October 1, 2006). However, fees would not be
increased until later in FY-2007. Further, as a result, the next fee
increase is delayed until March 2008 instead of the start of FY-2008.
These increases will not cover all of FPB's costs. FPB will need to
continue to increase fees in order to cover the program's operating
cost and maintain the required reserve balance. FPB believes that
increasing fees incrementally is appropriate at this time. Additional
fee increases beyond FY-2008 will be needed to sustain the program in
the future. However, we will continue to reduce costs, wherever
possible.
Employee salaries and benefits are major program costs that account
for approximately 80 percent of FPB's total operating budget. A general
and locality salary increase for Federal employees, ranging from 2.87
to 5.62 percent depending on locality, effective January 2006, has
significantly increased program costs and will continue to increase
costs at a similar rate in future years. This salary adjustment will
increase FPB's costs by over $700,000 per year. Increases in health and
life insurance premiums, along with workers compensation will also
increase program costs. In addition, inflation also impacts FPB's non-
salary costs. These factors have increased FPB's costs of operating
this program by over $600,000 per year.
Additional funds are necessary in order for FPB to continue to
cover the costs associated with additional staff and to maintain office
space and equipment. Additional revenues are also necessary to improve
the work environment by providing training and purchasing needed
equipment. In addition, FPB began in 2001, developing (with
appropriated funds) the Fresh Electronic Inspection Reporting/Resource
System (FEIRS) to replace its manual paper and pen inspection reporting
process. FEIRS was implemented in 2004. This system has been put in
place to enhance and streamline FPB's fruit and vegetable

[[Page 41886]]

inspection process, however additional revenue is required to maintain
FEIRS. FPB has also begun to cover the costs associated with the
Training and Development Center (TDC) in Fredericksburg, VA. A portion
of the appropriated funds received in October 2001, were for
infrastructure improvements including the development and maintenance
of the inspector TDC. With appropriated funding now depleted, FPB is
now obligated to support the TDC under revenues from the terminal
market user fee inspection program.
This rule should increase user fee revenue generated under the
destination market program by approximately 15 percent each fiscal
year. This action is authorized under the Agricultural Marketing Act of
1946 (AMA of 1946) (See 7 U.S.C. 1622(h)), which provides that the
Secretary of Agriculture may assess and collect ``such fees as will be
reasonable and as nearly as may be to cover the costs of services
rendered * * *'' There are more than 2,000 users of FPB's destination
market grading services (including applicants who must meet import
requirements \1\-- inspections which amount to under 2.5 percent of all
lot inspections performed). A small portion of these users are small
entities under the criteria established by the Small Business
Administration (13 CFR 121.201). There would be no additional
reporting, recordkeeping, or other compliance requirements imposed upon
small entities as a result of this rule. In compliance with the
Paperwork Reduction Act of 1995 (44 U.S.C. Chapter 35), the information
collection and recordkeeping requirements in Part 51 have been approved
previously by OMB and assigned OMB No. 0581-0125. FPB has not
identified any other Federal rules which may duplicate, overlap or
conflict with this proposed rule.
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\1\ Section 8e of the Agricultural Marketing Agreement Act of
1937, as amended (7 U.S.C. 601-674), requires that whenever the
Secretary of Agriculture issues grade, size, quality or maturity
regulations under domestic marketing orders for certain commodities,
the same or comparable regulations on imports of those commodities
must be issued. Import regulations apply during those periods when
domestic marketing order regulations are in effect. Section 1308 of
the Farm Security and Rural Investment Act of 2002 (Pub. L. 107-
171), 7 U.S.C. 7958, required USDA among other things to develop new
peanut quality and handling standards for imported peanuts marketing
in the United States.
Currently, there are 14 commodities subject to 8e import
regulations: Avocados, dates (other than dates for processing),
filberts, grapefruit, kiwifruit, olives (other than Spanish-style
green olives), onions, oranges, potatoes, prunes, raisins, table
grapes, tomatoes and walnuts. A current listing of the regulated
commodities can be found under 7 CFR Parts 944, 980, 996 and 999.
---------------------------------------------------------------------------

The destination market grading services are voluntary (except when
required for imported commodities) and the fees charged to users of
these services vary with usage. The impact on all businesses, including
small entities, is very similar. However, except for those persons who
are required to obtain inspections, most of these businesses are
typically under no obligation to use these inspection services, and,
therefore, any decision on their part to discontinue the use of the
services should not prevent them from marketing their products.
Further, even though fees will be raised, the increase is not excessive
and should not significantly affect these entities.

Executive Order 12988

This rule has been reviewed under Executive Order 12988, Civil
Justice Reform. This action is not intended to have retroactive effect.
This rule will not preempt any State or local laws, regulations 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 the provisions of this rule.

Action

The AMA of 1946 authorizes official inspection, grading, and
certification, on a user-fee basis, of fresh fruits, vegetables and
other products such as raw nuts, Christmas trees and flowers. The AMA
of 1946 provides that reasonable fees be collected from the users of
the services to cover, as nearly as practicable, the cost of the
services rendered. This rule would amend the schedule for fees and
charges for inspection services rendered to the fresh fruit and
vegetable industry to reflect the costs necessary to operate the
program.
AMS regularly reviews its user-fee financed programs to determine
if the fees are adequate. The Fresh Products Branch (FPB) has and will
continue to seek out cost saving opportunities and implement
appropriate changes to reduce its costs. Such actions can provide
alternatives to fee increases. FPB has reduced costs by approximately
$2 million. However, even with these efforts, FPB's existing fee
schedule will not generate sufficient revenue to cover program costs
while maintaining the Agency mandated reserve balance. Revenue
projections for FPB's destination market inspection work during FY-2006
are $15.3 million with costs projected at $20.4 million and an end-of-
year reserve balance of approximately $12.7 million. However, this
reserve balance is due in part, to appropriated funding received in
October 2001, for infrastructure, workplace, and technological
improvements. FPB's costs of operating the destination market program
are expected to increase to approximately $21.6 million during FY-2007
and $22.5 million during FY-2008. Revenues are projected to be $15.3
million for end of the fiscal year. The reserve balance for FY-2007 and
FY-2008, will fall below the Agency's mandated four-month reserve
level. The reserve balance is projected to be approximately $6.5
million for FY-2007 (3.6 months) and a negative $584,000 for FY-2008 (-
0.3 months).
Employee salaries and benefits are major program costs that account
for approximately 80 percent of FPB's total operating budget. A general
and locality salary increase for Federal employees, ranging from 2.87
to 5.62 percent depending on locality, effective January 2006, has
significantly increased program costs, and will continue to increase
costs at a similar rate in future years. This salary adjustment will
increase FPB's costs by over $700,000 per year. Increases in health and
life insurance premiums, along with workers compensation will also
increase program costs. In addition, inflation also impacts FPB's non-
costs. These factors have increased FPB's costs of operating this
program by over $600,000 per year.
Additional revenues are necessary in order for FPB to continue to
cover the costs associated with additional staff and to maintain office
space and equipment. Additional revenues are also necessary to continue
to improve the work environment by providing training and purchasing
needed equipment. In addition, FPB began in 2001, developing (with
appropriated funds) an automated system known as FEIRS, to replace its
manual paper and pen inspection reporting process. Approximately
$10,000 in additional revenue per month will be needed to maintain the
system. This system has been put in place to enhance FPB's fruit and
vegetable inspection processes. FPB has also begun to cover the costs
associated with the TDC in Fredericksburg, VA. A portion of the
appropriated funds received in October 2001, were for infrastructure
improvements including the development and maintenance of the inspector
TDC. With appropriated funding now depleted, FPB is now obligated to
support the TDC under revenues from the terminal market user fee
inspection program.
Based on the aforementioned analysis of this program's increasing
costs, AMS

[[Page 41887]]

will increase the fees for destination market inspection services. The
following table compares current fees and charges with the proposed
fees and charges for fresh fruit and vegetable inspection as found in 7
CFR 51.38. Unless otherwise provided for by regulation or written
agreement between the applicant and the Administrator, the changes in
the schedule of fees as found in Sec. 51.38 are:

----------------------------------------------------------------------------------------------------------------
Service Current 2007 2008
----------------------------------------------------------------------------------------------------------------
Quality and condition inspections of products each in quantities
of 51 or more packages and unloaded from the same land or air
conveyance:
Over a half carlot equivalent of each product...... $114.00 $131.00 $151.00
Half carlot equivalent or less of each product..... 95.00 109.00 125.00
For each additional lot of the same product........ 52.00 60.00 69.00
Condition only inspections of products each in quantities of 51
or more packages and unloaded from the same land or air
conveyance:
Over a half carlot equivalent of each product...... 95.00 109.00 125.00
Half carlot equivalent or less of each product..... 87.00 100.00 115.00
For each additional lot of the same product........ 52.00 60.00 69.00
Quality and condition and condition only inspections of products
each in quantities of 50 or less packages unloaded from the
same land or air conveyance:
For each product................................... 52.00 60.00 69.00
For each additional lot of any of the same product. 52.00 60.00 69.00
Lots in excess of carlot equivalents will be charged
proportionally by the quarter carlot...........................
Dock side inspections of an individual product unloaded directly
from the same ship:............................................
For each package weighing less than 30 pounds...... \1\2.9 \1\3.3 \1\3.8
For each package weighing 30 or more pounds........ \1\4.4 \1\5.1 \1\5.9
Minimum charge per individual product.............. 114.00 131.00 151.00
Minimum charge for each additional lot of the same 52.00 60.00 69.00
product....................................................
Hourly rate for inspections performed for other purposes during
the grader's regularly scheduled work week:
Hourly rate for non-carlot equivalent inspections 56.00 64.00 74.00
such as count, size, temperature, container, etc. or work
associated with inspections such as digital image services
will be charged at a rate that reflects the cost of
providing the service......................................
Overtime rate (per hour additional) for all inspections 29.00 33.00 38.00
performed outside the grader's regularly scheduled work week...
Holiday pay..................................................... 29.00 66.00 74.00
Hourly rate for inspections performed under 40 hour contracts 56.00 64.00 74.00
during the grader's regularly scheduled work week..............
Rate for billable mileage....................................... 1.00 1.15 1.32
----------------------------------------------------------------------------------------------------------------
\1\In cents.

A notice of proposed rulemaking was published in the Federal
Register on December 1, 2006, (71 FR 69497). FPB received one comment
after the comment period closed.
As previously stated, because the FY-2007 fee increase in effect in
the latter part of the fiscal year, AMS is changing the effective date
of the FY-2008 fee increase to March 1, 2008, to provide a sufficient
amount of time between the two fee increases. Finally, the regulatory
text in the proposed section 51.38(e) is corrected to reflect separate
fees for overtime and holiday note that appeared in the supplementary
information section of the proposed rule.

List of Subjects in 7 CFR Part 51

Agricultural commodities, Food grades and standards, Fruits, Nuts,
Reporting and recordkeeping requirements, Trees, Vegetables.

0
For reasons set forth in the preamble, 7 CFR Part 51 is amended as
follows:

PART 51--[AMENDED]

0
1. The authority citation for 7 CFR Part 51 continues to read as
follows:

Authority: 7 U.S.C. 1621-1627.

0
2. Section 51.38 is revised to read as follows:

Sec. 51.38 Basis for fees and rates.

(a) When performing inspections of product unloaded directly from
land or air transportation, the charges shall be determined on the
following basis:
(1) Quality and condition inspections of products in quantities of
51 or more packages and unloaded from the same air or land conveyance:
(i) $131 ($151, on or after March 1, 2008) for over a half carlot
equivalent of an individual product;
(ii) $109 ($125, on or after March 1, 2008) for a half carlot
equivalent or less of an individual product;
(iii) $60 ($69, on or after March 1, 2008) for each additional lot
of the same product.
(2) Condition only inspection of products each in quantities of 51
or more packages and unloaded from the same land or air conveyance:
(i) $109 ($125, on or after March 1, 2008) for over a half carlot
equivalent of an individual product;
(ii) $100 ($115, on or after March 1, 2008) for a half carlot
equivalent or less of an individual product;
(iii) $60 ($69, on or after March 1, 2008) for each additional lot
of the same product.
(3) For quality and condition inspection and condition only
inspection of products in quantities of 50 or less packages unloaded
from the same conveyance:
(i) $60 ($69, on or after March 1, 2008) for each individual
product:
(ii) $60 ($69, on or after March 1, 2008) for each additional lot
of any of the same product. Lots in excess of carlot equivalents will
be charged proportionally by the quarter carlot.
(b) When performing inspections of palletized products unloaded
directly from sea transportation or when palletized product is first
offered for inspection before being transported from the dock-side
facility, charges shall be determined on the following basis:
(1) Dock side inspections of an individual product unloaded
directly from the same ship:
(i) 3.3 (3.8, on or after March 1, 2008) cents per package weighing
less than 30 pounds;
(ii) 5.1 (5.9, on or after March 1, 2008) cents per package
weighing 30 or more pounds;

[[Page 41888]]

(iii) Minimum charge of $131 ($151, on or after March 1, 2008) per
individual product;
(iv) Minimum charge of $60 ($69, on or after March l, 2008) for
each additional lot of the same product.
(2) [RESERVED]
(c) When performing inspections of products from sea containers
unloaded directly from sea transportation or when palletized products
unloaded directly from sea transportation are not offered for
inspection at dock-side, the carlot fees in ``a'' of this section shall
apply.
(d) When performing inspections for Government agencies, or for
purposes other than those prescribed in paragraphs (a) through (c) of
this section, including weight-only and freezing-only inspections, fees
for inspections shall be based on the time consumed by the grader in
connection with such inspections, computed at a rate of $64 ($74, on or
after March 1, 2008) per hour;
Provided, that:
(1) Charges for time shall be rounded to the nearest half hour;
(2) The minimum fee shall be two hours for weight-only inspections,
and one-half hour for other inspections;
(3) When weight certification is provided in addition to quality
and/or condition inspection, a one hour charge shall be added to the
carlot fee;
(4) When inspections are performed to certify product compliance
for Defense Personnel Support Centers, the daily or weekly charge shall
be determined by multiplying the total hours consumed to conduct
inspections by the hourly rate. The daily or weekly charge shall be
prorated among applicants by multiplying the daily or weekly charge by
the percentage of product passed and/or failed for each applicant
during that day or week. Waiting time and overtime charges shall be
charged directly to the applicant responsible for their incurrence.
(e) When performing inspections at the request of the applicant
during periods which are outside the grader's regularly scheduled work
week, a charge for overtime or holiday work shall be made at the rate
of $33 for overtime and $66 for holiday work ($38 for overtime and $74
for holiday work, on or after March 1, 2008) per hour or portion
thereof in addition to the carlot equivalent fee, package charge, or
hourly charge specified in this subpart. Overtime or holiday charges
for time shall be rounded to the nearest half hour.
(f) When an inspection is delayed because product is not available
or readily accessible, a charge for waiting time shall be made at the
prevailing hourly rate in addition to the carlot equivalent fee,
package charge, or hourly charge specified in this subpart. Waiting
time shall be rounded to the nearest half hour.

Dated: July 26, 2007.
Lloyd C. Day,
Administrator, Agricultural Marketing Service.
[FR Doc. E7-14826 Filed 7-31-07; 8:45 am]
BILLING CODE 3410-02-P

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