Adjusting Program Fees for the Student and Exchange Visitor Program, 33762-33794 [2018-15140]

Download as PDF 33762 Federal Register / Vol. 83, No. 137 / Tuesday, July 17, 2018 / Proposed Rules DEPARTMENT OF HOMELAND SECURITY U.S. Immigration and Customs Enforcement 8 CFR Parts 103 and 214 [DHS No. ICEB–2017–0003] RIN 1653–AA74 Adjusting Program Fees for the Student and Exchange Visitor Program U.S. Immigration and Customs Enforcement (ICE), Department of Homeland Security. ACTION: Notice of proposed rulemaking. AGENCY: The Department of Homeland Security (DHS) proposes to adjust fees charged by the Student and Exchange Visitor Program (SEVP) to individuals and organizations. DHS proposes to raise the fee for Student and Exchange Visitor Information System (SEVIS) Form I–901, Fee Remittance for Certain F, J, and M Nonimmigrants, for nonimmigrants seeking to become academic (F visa) or vocational (M visa) students from $200 to $350. For most categories of individuals seeking to become exchange (J visa) visitors, DHS proposes to increase the fee from $180 to $220. For those seeking admission as J exchange visitors in the au pair, camp counselor, and summer work or travel program participant categories, DHS proposes to maintain the fee at $35. In addition to raising the student and exchange visitor fees, DHS proposes to increase the fee for submitting a school certification petition from $1,700 to $3,000. DHS proposes to maintain the fee for an initial school site visit at the current level of $655, but clarify that, with the effective date of the rule, DHS would exercise its current regulatory authority to charge the site visit fee not only when a certified school changes its physical location, but also when it adds a new physical location or campus. DHS proposes to establish and clarify two new fees: a $1,250 fee to submit a school recertification petition and a $675 fee to submit an appeal or motion following a denial or withdrawal of a school petition. Adjusting fees would ensure fee levels are sufficient to recover the full cost of activities of the program and would establish a fairer balance of the recovery of SEVP operational costs between beneficiary classes. DATES: Send comments by September 17, 2018. ADDRESSES: You may send comments, identified by Docket No. ICEB–2017– 0003, to the Federal Docket Management System (FDMS), a daltland on DSKBBV9HB2PROD with PROPOSALS4 SUMMARY: VerDate Sep<11>2014 22:15 Jul 16, 2018 Jkt 244001 government-wide, electronic docket management system, by any of the following methods: • Federal eRulemaking Portal: http:// www.regulations.gov. Follow the instructions for sending comments. • Mail: Address all comments to Sharon Snyder, Unit Chief, Student and Exchange Visitor Program, U.S. Immigration and Customs Enforcement, Department of Homeland Security, 500 12th Street SW, Washington, DC 20536. DHS docket staff, who maintain and process ICE’s official regulatory dockets, will scan the submission and post it to FDMS. Collection of information. You must submit comments on the collection of information discussed in this notice of proposed rulemaking to both DHS’s docket and the Office of Management and Budget’s (OMB) Office of Information and Regulatory Affairs (OIRA). OIRA submissions can be sent using any of the following methods. • Email (preferred): OIRA_ submission@omb.eop.gov (include the docket number and ‘‘Attention: Desk Officer for U.S. Immigration and Customs Enforcement, DHS’’ in the subject line of the email). • Fax: 202–395–6566. • Mail: Office of Information and Regulatory Affairs, Office of Management and Budget, 725 17th Street NW, Washington, DC 20503; Attention: Desk Officer, U.S. Immigration and Customs Enforcement, DHS. For additional instructions on sending comments, see the ‘‘Public Participation’’ heading of the SUPPLEMENTARY INFORMATION section of this document. FOR FURTHER INFORMATION CONTACT: Sharon Snyder, Unit Chief, Student and Exchange Visitor Program; U.S. Immigration and Customs Enforcement, Department of Homeland Security; 500 12th Street SW, Washington, DC 20536; 703–603–3400, sevp@ice.dhs.gov. This is not a toll-free number. Program information can be found at http:// www.ice.gov/sevis/. SUPPLEMENTARY INFORMATION: Table of Contents I. Executive Summary A. Purpose of Regulatory Action B. Summary of Major Provisions C. Costs and Benefits II. Abbreviations and Acronyms III. Public Participation A. Submitting Comments B. Viewing Comments and Documents C. Privacy Act IV. Program Background A. SEVP Legal Authorities B. SEVP and Development of SEVIS PO 00000 Frm 00002 Fmt 4701 Sfmt 4702 C. Authority To Collect Fees D. Full Cost Recovery V. Proposed Adjustment of SEVP Fees A. Activities Funded Under the 2008 Fee Rule 1. Improved SEVIS Functionality 2. Oversight and Enforcement 3. Recertification 4. School Liaisons B. Continuing SEVP Activities Funded With Proposed Fees 1. SEVIS Modernization 2. Increased SEVP Adjudication Personnel 3. Additional Investigatory Support C. Basis for Fee Schedule D. SEVP Baseline Costs and Fees E. Methodology 1. ABC Approach 2. Full Cost 3. Cost Basis for SEVP Fees Based on Current Services F. Summary of the Full Cost Information 1. Fee Allocation 2. SEVP FY 2019 and FY 2020 Cost Model Results 3. Fee Calculations 4. Proposed Fee Levels VI. Statutory and Regulatory Requirements A. Executive Orders 12866, 13563, and 13771: Regulatory Review 1. Background and Purpose of the Proposed Rule 2. Impacts of Regulatory Change 3. Alternatives B. Regulatory Flexibility Act C. Unfunded Mandates Reform Act D. Congressional Review Act E. Small Business Regulatory Enforcement Fairness Act of 1996 F. Executive Order 13132: Federalism G. Executive Order 12988: Civil Justice Reform H. Energy Effects I. Environment J. Paperwork Reduction Act List of Subjects The Proposed Amendments I. Executive Summary A. Purpose of Regulatory Action DHS proposes to adjust its fee schedule for students and exchange visitors as well as for petitioning and certified schools. These fees are associated with SEVP and SEVIS. They were last adjusted in 2008. See 73 FR 55683 (Sept. 26, 2008). SEVP, an ICE component, is funded entirely by fees charged to individual applicants and organizational petitioners. Fees collected from individuals and organizations are deposited into the Immigration Examinations Fee Account (IEFA) and used to fund the operational costs associated with SEVP and its management of SEVIS. See Immigration and Nationality Act (INA) section 286(m), as amended, 8 U.S.C. 1356(m), and Illegal Immigration Reform and Immigrant Responsibility Act of 1996, as amended, (IIRIRA) section 641(e), (g), 8 U.S.C. 1372(e), (g). E:\FR\FM\17JYP4.SGM 17JYP4 Federal Register / Vol. 83, No. 137 / Tuesday, July 17, 2018 / Proposed Rules In accordance with the requirements and principles of the Chief Financial Officers Act of 1990, 31 U.S.C. 901–03 (CFO Act), and OMB Circular A–25, SEVP reviews its associated fees that are deposited into the IEFA biennially and, if necessary, proposes adjustments to ensure recovery of costs necessary to meet national security, customer service, and adjudicative processing goals. SEVP completed a biennial fee review for fiscal year (FY) 2016 and FY 2017 in 2017. The projected results indicate that current fee levels are insufficient to recover the full cost of current and planned program activities. Section 286(m) of the INA, 8 U.S.C. 1356(m), provides that DHS may set fees for adjudication and naturalization services at a level that would ensure recovery of the full costs of providing such services, including the costs of providing similar services without charge to asylum applicants and certain other immigrants. Additionally, section 641 of IIRIRA, 8 U.S.C. 1372, authorizes DHS to periodically revise fees that cover the cost of carrying out SEVP and maintenance of SEVIS. Pursuant to these laws, DHS proposes the adjustments contained in this rule. SEVP calculates the totality of its fees to recover the full cost of its overall operations. Following its biennial fee review, SEVP anticipates that if it continues to operate at current fee levels, it will experience a shortfall of approximately $68.9 million beginning in 2019. At current fee levels, SEVP’s current expenditures exceed current revenues, without any service upgrades. The deficit is covered by surplus revenue that was previously accumulated from 2009 to 2015. This surplus will be exhausted in FY 2019 even without any service upgrades. This projected shortfall poses a risk of degrading operations and services funded by fee revenue. The proposed fee increases would allow SEVP to cover the current deficit between revenue and expenditures plus make the necessary service upgrades. The proposed fee levels thus eliminate the risk of degrading operations, while also ensuring full cost recovery by providing fees for each specific benefit that will more adequately recover the cost associated with administering the benefit. B. Summary of Major Provisions The proposed rule would adjust, institute, and clarify the application of fees pertaining to services SEVP provides to reflect existing and projected operating costs, program requirements, and continued planned program improvements, in the following manner: • Increase the two types of individual student and exchange visitor application fees, specifically the F and M I–901 SEVIS fee from $200 to $350 and the full J–1 I–901 SEVIS fee from $180 to $220; 33763 • Increase the SEVP school certification petition fee for initial certification from $1,700 to $3,000; • Institute a stand-alone fee of $1,250 when a school files a petition for recertification of its existing SEVP certification; • Revise regulations to ensure collection of a $675 fee to accompany the filing of a Form I–290B, Notice of Appeal or Motion, when a school appeals or files a motion to reconsider or reopen a denial or withdrawal of its SEVP certification; and • Maintain the $655 fee for a site visit at its current level, but clarify that, with the effective date of the rule, SEVP would exercise its current regulatory authority to charge the site visit fee when a certified school changes its physical location or adds a new physical location or campus on its Form I–17, ‘‘Petition for Approval of School for Attendance by Nonimmigrant Student.’’ In making these changes, the proposed rule would allow SEVP to fully fund activities and institute critical near-term program and system enhancements in a more equitable manner through a fairer balance of the recovery of SEVP operational costs between beneficiary classes. A summary of the current and future fee structures is provided in Table 1 below. C. Costs and Benefits SEVP proposes to adjust fees to the amounts listed in Table 1. TABLE 1—CURRENT AND PROPOSED FEE AMOUNTS Fee type Current fee daltland on DSKBBV9HB2PROD with PROPOSALS4 I–901 F/M ..................................................................................................................................... I–901 J-Full .................................................................................................................................. I–901 J-Partial .............................................................................................................................. I–17 Initial Certification ................................................................................................................ I–17 Recertification ...................................................................................................................... Site Visit—initial ........................................................................................................................... Site Visit—new location ............................................................................................................... Appeal Fee .................................................................................................................................. SEVP expects to have a total annual increase in fees of $75.2 million in FY 2019 transferred from individuals and entities for the services they receive. Table 2 shows the summary of the total annual number of payments, incremental fee amounts, and total fees transferred in FY 2019. This increase in fees would allow SEVP to not only maintain its current level of service but also enhance SEVP’s capability to VerDate Sep<11>2014 22:15 Jul 16, 2018 Jkt 244001 support national security and counter immigration fraud through the continued development and implementation of critical system and programmatic enhancements. Enhancements to SEVIS, including the establishment of a student portal, will assist designated school officials (DSOs) in their regulatory obligation to provide accurate and timely information and will also rebalance this reporting PO 00000 Frm 00003 Fmt 4701 Sfmt 4702 $200 180 35 1,700 0 655 0 0 Proposed fee $350 220 35 3,000 1,250 655 655 675 Incremental fee adjustment $150 40 0 1,300 1,250 0 655 675 requirement by providing students an automated means to update their information. Increased numbers of adjudication personnel will assist in reducing the processing times for initial petitions, updates, and recertifications, while enhanced vetting protocols will ensure that only those nonimmigrant students who are eligible to enter and remain in the country do so. E:\FR\FM\17JYP4.SGM 17JYP4 33764 Federal Register / Vol. 83, No. 137 / Tuesday, July 17, 2018 / Proposed Rules TABLE 2—ANNUAL PROPOSED INCREMENTAL FEE AMOUNTS, FY 2019 Projected number of payments Proposed incremental fee amounts Annual fees transfer to government I–901 F and M ............................................................................................................................. I–901 J-Full .................................................................................................................................. I–17 Initial Certification ................................................................................................................ I–17 Recertification ...................................................................................................................... Site Visits—initial ......................................................................................................................... Site Visits—new location ............................................................................................................. Appeals ........................................................................................................................................ 418,393 157,550 426 4,373 426 174 54 $150 40 1,300 1,250 0 655 675 $62,758,950 6,302,000 553,800 3,279,750 0 113,970 36,450 Total ...................................................................................................................................... ........................ ........................ 75,231,420 daltland on DSKBBV9HB2PROD with PROPOSALS4 II. Abbreviations and Acronyms ABC Activity-Based Costing ARO alternate responsible officer CBP U.S. Customs and Border Protection CEU Compliance Enforcement Unit CTCEU Counterterrorism and Criminal Exploitation Unit CFO Chief Financial Officer DHS Department of Homeland Security DoS Department of State DSO designated school official EBSVERA Enhanced Border Security and Visa Entry Reform Act of 2002, Public Law 107–173; May 14, 2002 FASAB Federal Accounting Standards Advisory Board FY Fiscal Year HSPD–2 Homeland Security Presidential Directive–2 ICE U.S. Immigration and Customs Enforcement IEFA Immigration Examinations Fee Account IIRIRA Illegal Immigration Reform and Immigrant Responsibility Act of 1996, as amended INA Immigration and Nationality Act of 1952, as amended INS Immigration and Naturalization Service IT information technology NAICS North American Industry Classification System OMB Office of Management and Budget PDSO principal designated school official RO responsible officer RFA Regulatory Flexibility Act RFE request for evidence SBA Small Business Administration SEVIS Student and Exchange Visitor Information System SEVP Student and Exchange Visitor Program SFFAS FASAB Statement of Federal Financial Accounting Standard SSA Social Security Administration TSA Transportation Security Administration UMRA Unfunded Mandates Reform Act of 1995 USCIS U.S. Citizenship and Immigration Services III. Public Participation We encourage you to participate in this rulemaking by submitting comments and related materials. All comments received will be posted without change to http:// VerDate Sep<11>2014 22:15 Jul 16, 2018 Jkt 244001 www.regulations.gov and will include any personal information you provide unless you request that your personally identifiable information be redacted. We also invite comments relating to the economic, environmental, energy, or federalism impacts that might result from this rulemaking action. See the ADDRESSES section for information on how to submit comments. A. Submitting Comments If you submit comments, please include the docket number for this rulemaking, indicate the specific section of this document to which each comment applies, and provide reasons supporting each suggestion or recommendation. You may submit your comments and materials online or by mail, but please use only one of these means. We recommend that you include your name and a mailing address, an email address, or a phone number in the body of your document so that we can contact you if we have questions regarding your submission. ICE will file all comments sent to our docket address, as well as items sent to the address or email address listed in the FOR FURTHER INFORMATION CONTACT section, in the public docket, except for comments containing marked confidential information. If you submit a comment, it will be considered received by ICE when it is received at the Docket Management Facility. To submit your comments online, go to http://www.regulations.gov and insert the complete docket number starting with ‘‘ICEB’’ in the ‘‘Search’’ box. Click on the ‘‘Comment Now!’’ box and enter your comment in the text box provided. Click the ‘‘Continue’’ box, and if you are satisfied with your comment, follow the prompts to submit it. If you submit your comments by mail, submit them in an unbound format, no larger than 81⁄2 by 11 inches, suitable for copying and electronic scanning and filing. Mailed submissions may be on paper or CD– ROM. If you would like ICE to acknowledge receipt of comments PO 00000 Frm 00004 Fmt 4701 Sfmt 4702 submitted by mail, include with your comments a self-addressed, stamped postcard or envelope on which the docket number appears. We will stamp the date of receipt on the postcard and mail it to you. We will consider all comments and materials received during the comment period and may change this proposed rule based on your comments. The docket is available for public inspection before and after the comment closing date. B. Viewing Comments and Documents To view comments, as well as documents mentioned in this preamble as being available in the docket, go to http://www.regulations.gov and insert the complete docket number starting with ‘‘ICEB’’ in the ‘‘Search’’ box. Click on the ‘‘Open Docket Folder’’ and then click on ‘‘View Comment’’ or ‘‘View All’’ under the ‘‘Comments’’ section of the page. Individuals without internet access can make alternate arrangements for viewing comments and documents related to this rulemaking by contacting ICE through the FOR FURTHER INFORMATION CONTACT section previously listed. Note: Because the software used in computing these fees proposed in this rule is a commercial product licensed to ICE, it may be accessed on-site by appointment by calling the SEVP Response Center at (800) 892–4829. C. Privacy Act Anyone can search the electronic form of comments received in any of our dockets by the name of the individual submitting the comment (or signing the comment, if submitted on behalf of an association, business, labor union, etc.). You may wish to consider limiting the amount of personal information that you provide in any voluntary public comment submission you make to DHS. DHS may withhold information from public viewing that it determines may affect the privacy of an individual or is offensive. For additional information, please read the Privacy and Security E:\FR\FM\17JYP4.SGM 17JYP4 Federal Register / Vol. 83, No. 137 / Tuesday, July 17, 2018 / Proposed Rules Notice posted on http:// www.regulations.gov. IV. Program Background daltland on DSKBBV9HB2PROD with PROPOSALS4 A. SEVP Legal Authorities IIRIRA (Pub. L. 104–208, div. C, 110 Stat. 3009–546 (1996)) established the requirement for the monitoring and reporting of the activities of foreign students and exchange visitors while they reside in the United States (U.S.). Section 641 of IIRIRA, 8 U.S.C. 1372, mandated that the Attorney General develop and conduct a program for the electronic collection of data by U.S.approved (i.e., certified) institutions of higher education, other approved educational institutions, and designated exchange visitor programs, to monitor nonimmigrants possessing or applying for F, M, and J class visas with a Certificate of Eligibility.1 In addition, President George W. Bush issued Homeland Security Presidential Directive 2 (HSPD–2) in October 2001, which requires DHS to conduct periodic, ongoing recertification of all schools certified to accept F or M students. Combating Terrorism Through Immigration Policies, Oct. 29, 2001, as amended by HSPD—5 (Management of Domestic Incidents, Feb. 28, 2003, Compilation of HSPDs (updated through Dec. 31, 2007), available at http:// www.gpo.gov/fdsys/pkg/CPRT110HPRT39618/pdf/CPRT110HPRT39618.pdf. The Homeland Security Act of 2002 created DHS, transferred a broad range of immigration authorities from the Attorney General and the Commissioner of Immigration and Naturalization to the Secretary of Homeland Security, and vested ICE with responsibility for administration of the electronic data collection system, also known as SEVIS. See Public Law 107–296, sec. 442(a)(4), 116 Stat. 2136, 2193–94 (codified at 6 U.S.C. 252(a)(4) (vesting SEVIS-related authority in ‘‘Bureau of Border Security’’); Reorganization Plan Modification for the Department of Homeland Security, H.R. Doc. No. 108– 1 Under INA section 101(a)(15)(F)(i), 8 U.S.C. 1101(a)(15)(F)(i), a foreign student may be admitted into the United States in nonimmigrant status to attend an academic or accredited language training school (F nonimmigrant students). Under INA section 101(a)(15)(M)(i), 8 U.S.C. 1101(a)(15)(M)(i), a foreign student may be admitted into the United States in nonimmigrant status to attend a vocational education school (M nonimmigrant students). An F or M nonimmigrant student may enroll in a particular school only if the Secretary of Homeland Security has certified the school for the attendance of such students. Under INA section 101(a)(15)(j), 8 U.S.C. 1101(a)(15)(j), a foreign citizen may be admitted into the United States in nonimmigrant status as an exchange visitor (J visa) in an exchange program sponsored by the Department of State (DoS). VerDate Sep<11>2014 22:15 Jul 16, 2018 Jkt 244001 32, at 3–4 (2003) (set forth as a note to 6 U.S.C.A. 542 (West 2018)) (renaming ‘‘Bureau of Border Security’’ as ‘‘Bureau of Immigration and Customs Enforcement’’); DHS Delegation 7030.2(2)(Z) (2004) (affirming delegation of such authority from Secretary of Homeland Security to ICE). ICE assumed responsibility for SEVIS and established SEVP. DHS has issued regulations that address data collection requirements for SEVP certification, oversight, and recertification of schools authorized to enroll F or M students. 8 CFR 214.3, 214.4. B. SEVP and Development of SEVIS SEVP is responsible for developing, maintaining, and improving SEVIS, which is an internet-based application that facilitates timely electronic reporting and monitoring of nonimmigrant students, exchange visitors, and their dependents in the United States. SEVIS enables schools and program sponsors to transmit electronic information to DHS and the Department of State (DoS) throughout a student’s or exchange visitor’s program in the United States. SEVIS is intended to improve customer service by streamlining the application and adjudication processes. Through continuing modernization efforts, it addresses issues in student and school system processes by providing information technology (IT) solutions and modifying business processes. Schools and exchange visitor programs have been required to enter F, M, and J nonimmigrant data into SEVIS since August 1, 2003. As of April 1, 2017, SEVIS contained 1.4 million active F, M, and J student and exchange visitor records. Approximately 8,700 schools are SEVP-certified and approximately 1,500 exchange visitor programs are DoS-designated. SEVIS enables DHS and DoS to efficiently administer their approval (i.e., certification and designation, respectively) and oversight processes of schools and programs that wish to benefit from enrolling nonimmigrants. SEVIS assists law enforcement agencies in tracking and monitoring F, M, and J nonimmigrant status and apprehending violators before they can potentially endanger the national security of the United States. SEVIS also assists other federal agencies such as DoS, and other DHS components such as U.S. Citizenship and Immigration Services (USCIS) and U.S. Customs and Border Protection (CBP) in better serving F, M, and J nonimmigrant applicants. Finally, SEVIS enables schools and exchange visitor programs to instantaneously transmit electronic information and PO 00000 Frm 00005 Fmt 4701 Sfmt 4702 33765 changes in required information on F, M, and J nonimmigrants to ICE and DoS throughout their stays in the United States.2 These include required notifications, reports, and updates to personal data. SEVIS allows schools to submit school certification applications, update certification information, submit updates to DHS that require adjudication, and also create and update F visa (academic) and M visa (vocational) student and dependent records. SEVP managers and adjudicators have the capability to adjudicate updates made to school records using SEVIS, and principal designated school officials (PDSOs) and designated school officials (DSOs) are notified through SEVIS of the adjudication results. SEVIS also allows program sponsors to submit designation forms for the J–1 visa program, create program designations, and update program designation information. DoS personnel have the capability to adjudicate information submitted by responsible officers (ROs) and alternate responsible officers (AROs). ROs and AROs are notified through SEVIS of any adjudication results. SEVIS shares information with other agencies’ and components’ systems— DoS, USCIS, CBP, Transportation Security Administration (TSA), and others—to better monitor the status of student or exchange visitors throughout their stays in the United States. This allows DHS to meet the aims of the USA PATRIOT Act. See Public Law 107–56, sec. 416, 115 Stat. 272, 354–55 (2001). In addition, that Act mandates that the Secretary of Homeland Security,3 in consultation with the Secretary of State, collect information on the date of entry and port of entry for each nonimmigrant for whom information is collected under IIRIRA section 641. Id. at sec. 416(b). 2 An individual seeking F or M nonimmigrant student status must apply to an SEVP-certified school and be accepted for enrollment. From the enrollment information provided by the nonimmigrant, the school enters student information into SEVIS and issues a Form I–20, ‘‘Certificate of Eligibility for Nonimmigrant Student Status.’’ The individual must submit a valid Form I–20 when applying for an F or M visa. Similarly, an individual seeking J–1 nonimmigrant status must apply to a DoS-designated exchange visitor program and be accepted for enrollment as a basis to apply for a J exchange visitor visa. From the information provided by the accepted individual, the exchange visitor program enters exchange visitor information into SEVIS and issues a Form DS–2019, ‘‘Certificate of Eligibility for Exchange Visitor (J–1) Status.’’ The applicant must submit a valid Form DS–2019 when applying for a J visa. 3 The USA PATRIOT Act refers to the Attorney General, but the Homeland Security Act of 2002, as amended, transferred the functions of the Immigration and Naturalization Service (INS) to DHS. Public Law 107–296, tit. IV, subtits. D, E, F, 116 Stat. 2135, 2192 (Nov. 25, 2002), as amended. E:\FR\FM\17JYP4.SGM 17JYP4 33766 Federal Register / Vol. 83, No. 137 / Tuesday, July 17, 2018 / Proposed Rules daltland on DSKBBV9HB2PROD with PROPOSALS4 C. Authority To Collect Fees The Secretary is specifically authorized to collect fees for SEVP from prospective F and M students and J exchange visitors, subject to certain limits for certain J–1 nonimmigrants. 8 U.S.C. 1372(e)(1). The Secretary is authorized to periodically revise those fees, with certain exceptions, to take into account changes in the overall cost of carrying out the program. IIRIRA section 641(e)(4)(A), (g)(2), 8 U.S.C. 1372(e)(4)(A), (g)(2). Similarly, section 286(m) of the INA authorizes the Secretary to collect fees for adjudication and naturalization services at a level that would ensure recovery of the full costs of providing such services, including the costs of providing similar services without charge to asylum applicants and certain other immigrants. Additionally, pursuant to INA section 286(m), the level that is set may include recovery of any additional costs associated with the administration of the fees themselves. Under this authority, user fees are employed not only for the benefit of the payer of the fee and any collateral benefit resulting to the public, but also to provide a benefit to certain others.4 All fees collected under these authorities are deposited as offsetting receipts into the IEFA and are available to the Secretary until expended for authorized purposes. See IIRIRA section 641(e)(4)(B), 8 U.S.C. 1372(e)(4)(B); INA section 286(m), 8 U.S.C. 1356(m). DHS proposes the revised fee schedule contained in this rule in accordance with the above-referenced authorities. As a general matter, in developing fees and fee rules, DHS looks to a range of governmental accounting provisions. OMB Circular A–25, User Charges (Revised), para. 6, 58 FR 38142 (July 15, 1993), defines ‘‘full cost’’ to include all direct and indirect costs to any part of the Federal government for providing a good, resource, or service. These costs include, but are not limited to, an appropriate share of the following: Direct and indirect personnel cost, physical overhead, consulting and other indirect cost, management and supervisory cost, enforcement, information collection and research, and establishment of standards and regulation, including any required environmental review. 4 The longstanding interpretation of DHS is that the ‘‘including’’ clause in section 286(m) does not constrain DHS’s fee authority under the statute. The ‘‘including’’’ clause offers only a non-exhaustive list of some of the costs that DHS may consider part of the full costs of providing adjudication and naturalization services. See 8 U.S.C. 1356(m); 81 FR 26903, 26906 n.10 (May 4, 2016). VerDate Sep<11>2014 22:15 Jul 16, 2018 Jkt 244001 Section 31.5 of OMB Circular A–11, Preparation, Submission and Execution of the Budget, July 1, 2016, directs agencies to develop user charge estimates based on the full cost recovery policy set forth in OMB Circular A–25, User Charges (budget formulation and execution policy regarding user fees). The Federal Accounting Standards Advisory Board (FASAB) Statement of Federal Financial Accounting Standards (SFFAS) No. 4: Managerial Cost Accounting Concepts and Standards for the Federal Government, July 31, 1995, updated June 2017, provides the standards for managerial cost accounting and full cost. SFFAS No. 4 defines ‘‘full cost’’ to include ‘‘direct and indirect costs that contribute to the output, regardless of funding sources.’’ 5 FASAB identifies various classifications of costs to be included and recommends various methods of cost assignment to identify full cost. Activity-based costing (ABC) is highlighted as a costing methodology useful to determine full cost within an agency. The Chief Financial Officers Act of 1990, 31 U.S.C. 901–903, requires each agency’s Chief Financial Officer (CFO) to ‘‘review, on a biennial basis, the fees, royalties, rents and other charges imposed by the agency for services and things of value it provides, and make recommendations on revising those charges to reflect cost incurred by it in providing those services and things of value.’’ 31 U.S.C. 902(a)(8). This proposed rule would eliminate the risk of a projected shortfall for SEVP operations and services funded by fee revenue. It proposes increased funding that supports continuing and new initiatives critical to improving the program and reflects the implementation of specific costallocation methods to segment program costs to the appropriate fee—F and M students, J exchange visitors, or schools. D. Full Cost Recovery Consistent with these authorities and sources, this proposed rule would ensure that SEVP recovers the full costs for the services it provides and maintains a projected level of service necessary to fulfill its mission. The proposed rule would do this in two ways. First, where possible, the proposed rule sets fees at levels sufficient to cover the full cost of the corresponding services and assigns these fees to those who are the primary beneficiaries. DHS works with OMB and 5 See FASAB, Statement of Federal Financial Accounting Standards 4: Managerial Cost Accounting Standards and Concepts 26 (June 2017), available at http://files.fasab.gov/pdffiles/ handbook_sffas_4.pdf (last visited Feb. 20, 2018). PO 00000 Frm 00006 Fmt 4701 Sfmt 4702 generally follows OMB Circular A–25, which ‘‘establishes federal policy regarding fees assessed for Government services and for sale or use of Government goods or resources.’’ See OMB Circular A–25, User Charges (Revised), para. 6, 58 FR 38142 (July 15, 1993). A primary objective of OMB Circular A–25 is to ensure that federal agencies recover the full cost of providing specific services to users and associated costs. This proposed rule would set fees at a level sufficient to fund the full cost of conducting the program and general operations for FY 2019. See INA sec. 286(m), 8 U.S.C. 1356(m). DHS has interpreted this statutory fee-setting authority, including the authorization for DHS to collect ‘‘full costs’’ for providing, in pertinent part, ‘‘adjudication . . . services,’’ as granting DHS broad discretion to charge fees at a level that will ensure recovery of all direct and indirect costs associated with providing pertinent immigration adjudication services. This approach is also consistent with the SEVP-specific fee authority referenced above, which authorizes DHS to set fees at a level that funds the full cost of conducting the program. See IIRIRA section 641(e), 8 U.S.C. 1372(e). In following OMB Circular A–25 to the extent appropriate, including its direction that fees should be set to recover the costs of an agency’s services in their entirety and that full costs are determined based on the best available records of the agency, DHS accounts for the reality that costs of all SEVP operations cannot always be directly correlated to certain specific fees. DHS therefore applies the discretion provided in the above authorities, in taking the following actions: (1) Employing ABC to establish a model for assigning costs to specific benefit requests in a manner reasonably consistent with OMB Circular A–25; (2) distributing costs that are not attributed to or driven by specific adjudication services; and (3) making additional adjustments to effectuate specific policy objectives. V. Proposed Adjustment of SEVP Fees This proposed rule would amend the current fee structure governing the collection of fees from individuals by increasing the individual student and exchange visitor application fee (I–901 SEVIS fee). In addition, the rule proposes to amend the fee structure paid by schools by increasing the SEVP school certification petition costs for initial certification, instituting a fee to address school recertification costs for the ongoing recertification process, and E:\FR\FM\17JYP4.SGM 17JYP4 Federal Register / Vol. 83, No. 137 / Tuesday, July 17, 2018 / Proposed Rules requiring a fee to accompany the filing of an appeal, a motion to reconsider, or a motion to reopen filed by a school organization. SEVP proposes no change to the current fee for site visits. The proposed fees for recertification petitions and appeals and motions would better recover a reasonable portion of related existing and projected operating costs, program requirements, and planned program improvements. Fees were last adjusted in 2008. 73 FR 55683. Refined and expanded SEVP operations, SEVIS modifications, as well as inflation, have increased SEVP operating costs and are the basis for the proposed increases to the I–901 SEVIS fee and the school certification petition fee. daltland on DSKBBV9HB2PROD with PROPOSALS4 A. Activities Funded Under the 2008 Fee Rule In the 2008 rulemaking that resulted in the most recent agency adjustment, ‘‘Adjusting Program Fees and Establishing Procedures for Out-ofCycle Review and Recertification of Schools Certified by the Student and Exchange Visitor Program To Enroll F and/or M Nonimmigrant Students’’ (2008 Fee Rule), DHS outlined its rationale for a fee increase by identifying a set of organizational initiatives essential to its mission: Improving SEVIS functionality, improving oversight and enforcement, implementing recertification procedures, and developing school liaison activity. 73 FR 55683. SEVP, in accordance with its commitment to the goals prescribed in that rule, has implemented the following actions since then: 1. Improved SEVIS Functionality SEVP’s original plan to roll out a comprehensive overhaul of SEVIS (known as SEVIS II) was replaced by an approach that focused on a series of smaller and more targeted SEVIS enhancements—now termed SEVIS Modernization. New technologies have become available since the comprehensive SEVIS overhaul was first envisioned. The use of these technologies enables SEVP to apply many of the functionalities that were planned for SEVIS II to the current system. At the same time, this approach eliminates potential risks and complications that result from migrating mass quantities of critical data from one system to the next, which would have been necessary if the SEVIS II approach had been fully implemented. Building on the experience, knowledge, and stakeholder feedback acquired during the planning process, SEVP has launched hundreds of smaller-scale VerDate Sep<11>2014 22:15 Jul 16, 2018 Jkt 244001 SEVIS enhancements. These efforts have addressed the majority of national security vulnerabilities previously identified, by improving critical system functionalities that support data integrity in SEVIS, including establishing system functions that support standardization of student and exchange visitor name and address data entry. The enhancements have also improved system performance for end users. With the introduction of more detailed SEVIS event history and new abilities for DSOs to create student data reports, these enhancements enable action on multiple student records simultaneously. As an example, SEVP, in collaboration with CBP, developed and implemented an admissibility indicator tool that links to real-time SEVIS data to assist CBP officers at ports of entry in determining whether F, M, and J nonimmigrants may enter the United States based on their SEVIS record status. Prior to the availability of the admissibility indicator, first-line CBP officers relied on paper documentation that the nonimmigrant student or exchange visitor presented. Today, the admissibility indicator gives CBP officers a quick assessment of the most pertinent and current SEVIS data that are necessary in determining whether nonimmigrant students, exchange visitors, and their dependents are eligible to enter the United States or require further investigation. As a result, CBP officers are able to use the admissibility indicator at points of inspection to quickly verify the information contained on the paper documentation that is also required for entry. This assists in reducing long wait times, aids with detecting and preventing visa fraud, and otherwise enhances compliance efforts and national security. 2. Oversight and Enforcement A dedicated compliance enforcement program that includes criminal investigative efforts is an integral part of ensuring the operational effectiveness of SEVP. By analyzing SEVIS data, SEVP identifies indicators of potential misuse or abuse of nonimmigrant status and provides leads to Counterterrorism and Criminal Exploitation Unit (CTCEU) law enforcement personnel for further investigation. At the time the 2008 Fee Rule was published, the Compliance Enforcement Unit (CEU), the predecessor of CTCEU, was not sufficiently staffed to address all leads generated from SEVIS. As a result, only the highest priority leads were investigated, which left open unaddressed vulnerabilities. With the PO 00000 Frm 00007 Fmt 4701 Sfmt 4702 33767 increased I–901 SEVIS fee revenue, DHS has hired additional personnel and currently funds 234 Homeland Security Investigations (HSI) positions with primary responsibility for nonimmigrant violator investigations. The increased number of HSI personnel assigned to support CTCEU investigations has enabled more robust coordination between SEVP and CTCEU and has successfully reduced the exploitation of the laws and programs relating to nonimmigrant students and exchange visitors. An example of the result of such close and extensive crosscoordination was the conviction of the founder and president of Tri-Valley University (TVU) on 31 counts in March 2014, ranging from conspiracy to commit visa fraud and alien harboring to money laundering.6 SEVP will continue to support cooperation and coordination with CTCEU to maintain the viability of F, M, and J student and exchange visitor programs within the United States. 3. Recertification SEVP implemented the recertification procedure prescribed in the 2008 Fee Rule beginning with its first recertification cycle in 2010. Institutions that participated in the first cycle have been reviewed several times and will continue to undergo the recertification process every two years. Because there are thousands of schools, recertification is a rolling process allowing adjudicators to address issues with one school before moving on to the next. Each school is notified 2 years to the month following the date of its last recertification or certification about its need to file for recertification in order to maintain its certification. From that date, the school has 180 days to file for recertification. 8 CFR 214.3(h)(2)(i). This cycle helps ensure that only schools that operate in accordance with the law remain certified by SEVP. 4. School Liaisons SEVP deployed the first group of field representatives in April 2014, followed by three additional groups later in 2014 and 2015, bringing the national total to 60 field representatives distributed among three geographically determined units. The field representatives serve as liaisons between SEVP and SEVPcertified schools that enroll F and M 6 See Sentencing Memorandum, Docket Item No. 195 (Oct. 24, 2014), United States v. Su, Case No.11cr-00288 (N.D. Cal.), 2, 8, available at https:// www.courtlistener.com/docket/4178123/195/ united-states-v-su/; see also Jury Verdict, Docket Item No. 119 (Mar. 24, 2014), United States v. Su, supra, available at https://www.courtlistener.com/ docket/4178123/119/united-states-v-su/. E:\FR\FM\17JYP4.SGM 17JYP4 33768 Federal Register / Vol. 83, No. 137 / Tuesday, July 17, 2018 / Proposed Rules nonimmigrant students and have conducted more than 32,500 school visits since the unit launch. Field representatives serve as a key resource for schools by providing individualized instruction on the SEVP certification and recertification processes. They also educate DSOs on Federal statutes, regulations, and guidance pertinent to F and M students studying in the United States. Because DSOs are responsible for entering F and M nonimmigrant data into SEVIS, the data integrity of the system depends heavily on the DSOs’ understanding the importance of accurate and timely reporting of the required information. By providing individualized assistance to DSOs, the field representatives enhance national security by maintaining and improving the data integrity of SEVIS. daltland on DSKBBV9HB2PROD with PROPOSALS4 B. Continuing SEVP Activities Funded With Proposed Fees In developing this proposed rule, SEVP reviewed its current and projected costs, identified goals for services, analyzed projected future workload, and allocated costs to specific services. In addition to the full SEVP operating costs described in the following sections, the proposed fees would fund the continuing efforts identified in the 2008 rule, now updated to reflect technological refinements and operational enhancements. These updated activities include SEVIS modernization and increases in adjudication support and investigatory and compliance personnel. 1. SEVIS Modernization SEVIS is a web-based system that schools and program sponsors use to transmit information about their programs and participating F, M, and J nonimmigrants. It became fully operational in February of 2003, replacing a paper-based F, M, and J nonimmigrant process. Since its inception, SEVIS has evolved well beyond its original purpose as a data collection tool. Today, approximately 35,000 officials from approved schools and program sponsors use SEVIS data to manage 1.4 million F, M, and J nonimmigrants and their dependents during their stays in the United States. SEVIS provides real-time administrative and enforcement information to DHS components, including CBP and USCIS, as well as DoS. SEVIS also receives information about F, M, and J nonimmigrant visa applications, entry and exit records, and benefit applications from these entities through various interfaces. This makes SEVIS a critical national security component and a primary resource for VerDate Sep<11>2014 22:15 Jul 16, 2018 Jkt 244001 law enforcement and intelligence communities to extract the data necessary to conduct counterterrorism and counterintelligence threat analysis. The threat of new forms of terrorism and other criminal activity exploiting the Nation’s immigration laws continues to be a public safety and national security concern in the United States. As a result, there is an increasing need for sophisticated SEVIS data analysis to detect individuals who engage in immigration fraud or otherwise pose a risk to national security through willful misrepresentation. In addition, end users from schools and program sponsors have expressed concerns and provided feedback reflecting the necessity to create SEVIS functionalities that enable the accurate reporting of new and innovative educational program models. While SEVIS has been modified to meet the most critical needs through hundreds of upgrades and patches, including adding abilities for the system to preemptively address data input errors, system functionality concerns (due to time lags, system constraints, and other system design limitations) continue to affect all SEVIS users and necessitate continuous development of SEVIS design. In response, SEVP has begun an effort— known as SEVIS Modernization—that involves redesigning the entire system over time in prioritized increments. Continued Modernization will increase security by providing real-time, personcentric data. This data will reduce fraud and increase awareness by providing government officials with actionable intelligence with which to make decisions and initiate immigration actions. Informed decisions and efficient investigations allow for better management of F, M, and J nonimmigrant data and preventing highrisk individuals from entering the United States. To address critical system limitations and improve the SEVIS user experience, SEVP has identified the following list of key SEVIS modernization priorities for continued funding through the increased I–901 SEVIS Fee revenue: • Student Portal. F–1 students engaged in authorized optional practical training are required to report their contact and employer information to DHS. See 8 CFR 214.2(f)(12), (f)(17). At present, students report the required information to their DSOs, who then report the information in SEVIS. By regulation, students must report any new required information to their DSOs within 10 days of the change, and the DSOs must report such information in SEVIS within 21 days. 8 CFR 214.2(f)(17). PO 00000 Frm 00008 Fmt 4701 Sfmt 4702 This external SEVIS student portal will enable students to directly add or edit the required contact and employer information so that their SEVIS record would be updated in real time. This will reduce processing redundancies and lessen the potential for data entry errors by eliminating the need for the student to first report such information to the DSO who will then enter the reported data into SEVIS. The portal will also consequently reduce the workload of DSOs and make the reported data available to DHS sooner. With future expansion, the portal will address SEVIS vulnerabilities related to accurate monitoring of F, M, and J nonimmigrant status and location of nonimmigrant students and exchange visitors by closing national security vulnerabilities related to person-centric, paperless, people-matching capabilities. In establishing a portal for student use in this manner, DHS will encourage students to assume responsibility for maintaining their immigration status, reduce the system’s reliance on paperdriven processes, and reinforce the operational premise and security advantages of ‘‘one person, one record.’’ Through use of a record-matching protocol, all SEVIS records will be collated and presented as a unified, person-centric statement of information and activity. These summaries will be available to all operational entities, including school officials, who will have access in the SEVIS record to the same up-to-date information, including all student history. • Support of the Adjudication Process. As part of maintaining their SEVP certification, schools are required to update certain information in SEVIS about their operations and programs any time such information changes. See 8 CFR 214.3(g)(2). SEVP is required to adjudicate such changes. SEVP currently receives, on average, 350 weekly updates from schools; each update may contain several subparts, including school contact information changes and additions of new programs. At present, system constraints require SEVP adjudicators to adjudicate all parts of the update simultaneously and to deny the entire update if even one part of the update cannot be approved. This causes additional workload and delays for schools and adjudicators due to resubmissions of updates. The new SEVIS functionality that supports adjudication will provide SEVP and DoS with enhanced flexibility to adjudicate school certification and exchange visitor sponsor designation updates and applications and consequently enable SEVP and DoS to E:\FR\FM\17JYP4.SGM 17JYP4 daltland on DSKBBV9HB2PROD with PROPOSALS4 Federal Register / Vol. 83, No. 137 / Tuesday, July 17, 2018 / Proposed Rules adjudicate updates and applications more efficiently. • Automated Data Tracking. Currently, SEVP and DoS manually monitor SEVIS data for potential noncompliance indicators with regard to schools, students, and exchange visitor program participants and sponsors. In FY 2016, manual monitoring yielded 75 compliance investigations, which resulted in withdrawal of certification for 21 noncompliant schools. Automated SEVIS data tracking functionality would provide SEVP and DoS with enhanced abilities to track and monitor compliance. This additional capability would allow SEVP and DoS to more quickly detect data trends that are potential indicators of fraudulent activities. With the use of automation, SEVP anticipates a 100 percent increase in fraudulent activity flags (from 75 to 150 per year), which is estimated to significantly increase the detection rate of noncompliant schools and subsequent withdrawals of SEVP certification due to noncompliance. Such functionality would play an important role in ensuring the integrity of the Nation’s immigration system. SEVIS Access Approval Tracking System (SAATS). School officials (PDSOs and DSOs) and program officials (AROs and ROs) constitute the largest and most critical component of SEVIS users as they are responsible for entering the initial student and exchange visitor data into SEVIS. Their need to access the system is confirmed by petition through their sponsoring school or program. Once granted access, designated school and program officials confirm their ongoing need for access in a yearly validation exercise in which a delayed response or no response results in automatic system access denial. Unlike government employees who need access to SEVIS to perform official functions, school and program officials have not had to meet uniform security requirements. Recently, SEVP began conducting national criminal background checks on designated school officials (DSOs). SEVP has vetted all DSOs at K–12 schools and, since May 2017, has vetted all newly designated DSOs, helping to ensure the safety of nonimmigrant students and exchange visitors and preserve the integrity of SEVIS data. SEVP is considering eventually extending this screening and security review to DSOs and ROs who were appointed prior to May 2017 and other school and program officials through regulatory action. SEVP will bear the upfront cost of this security review. When fully implemented, all individuals who VerDate Sep<11>2014 22:15 Jul 16, 2018 Jkt 244001 require access to SEVIS will be vetted prior to being granted such access. DHS will complete the vetting adjudication for the RO or ARO and provide a copy of its decision to the DoS Bureau of Educational and Cultural Affairs. This initiative will strengthen the mechanism for approving user access to SEVIS. DHS and DoS rely on PDSOs, DSOs, ROs, and AROs as key links in the process to mitigate potential threats to national security and ensure compliance with immigration law. DHS would require that anyone nominated to serve as a PDSO, DSO, RO, or ARO receive a favorable SEVIS Access Approval Process (SAAP) assessment prior to their appointment and subsequent approval for access to SEVIS. • Information Sharing. SEVIS currently shares information and exchanges data with 11 intragovernmental interface partners. The modernized Information Sharing module will be capable of sharing data contained in modernized SEVIS data stores with existing interface partners. Other interfaces to support modernized capabilities in other modules, including paperless capabilities, are being considered to address SEVIS vulnerabilities. The centralization of all information-sharing capabilities in a single module will allow for efficiencies in development efforts, system performance, and sustainability. • Use of Cloud Technologies. The cloud infrastructure effort supports the program by providing flexible, efficient, and cost-effective cloud services and infrastructure to facilitate and enable agile development and testing processes. While SEVIS actively mitigates known security threats, it lacks functionalities to proactively analyze end user data to detect potential misuse. The use of cloud technologies will permit increased analysis of SEVIS end user data and increase the efficiency and security of controlling and managing access to SEVIS by users not affiliated with DHS, both governmental and nongovernmental. In addition, it will enable more efficient management of user names and passwords and allow credentials to be safely passed among system components. Such analysis is necessary to create defined alerts about user activity that is indicative of risk factors to prompt timely criminal and compliance investigations. The cloud infrastructure module supports the program by providing flexible, efficient, and cost-effective cloud services and infrastructure to facilitate and enable agile development and testing processes. PO 00000 Frm 00009 Fmt 4701 Sfmt 4702 33769 This planned modernization effort, with implementation during FY 2018– 2021, is expected to greatly enhance the capability of DHS to identify and reduce national security threats; reduce the possibility for reporting errors by prospective and approved F, M, and J nonimmigrants, as well as their schools and programs; and better provide updated, correct, real-time information to academic, law enforcement, and other government users. SEVP projects that the cost for developing and deploying these SEVIS modifications is $53.19 million. SEVP would incur $13.15 million of that cost in FY 2018, $13.75 million in FY 2019, $13.14 million in FY 2020, and $13.15 million in FY 2021. 2. Increased SEVP Adjudication Personnel In 2008, DHS proposed to recertify all schools approved for attendance by F and M students every 2 years, pursuant to title V, section 502 of EBSVERA and HSPD–2, and established procedures for the review of each SEVP-certified school every 2 years, as well as out-of-cycle reviews whenever it determines that clarification or investigation of school performance or eligibility is necessary. Recertification is a determination of performance and compliance with required standards in the period since the previous certification. In this comprehensive review of an SEVPcertified school by an SEVP adjudicator, SEVP affirms that the school remains eligible and is complying with regulatory recordkeeping, retention, reporting, and other requirements. Performance is monitored through SEVIS, DHS records, submissions from the school, and possible onsite reviews. If noncompliance is discovered, SEVP requires schools, as appropriate, to make corrections immediately. SEVP reviews the school’s compliance with Federal law and regulations. In recent years, the scope of work of SEVP adjudication has expanded to include administrative compliance enforcement, support of criminal investigations, and adjudication of school petitions, including certification petitions, recertification petitions, and updates to school information. As a result, SEVP adjudicators have experienced significant workload increases, which in turn have resulted in longer SEVP adjudication processing times of school petitions and student compliance issues. Since initiating recertification, SEVP has determined that the current number of SEVP adjudication personnel is inadequate to meet the congressional requirement for recertifying or E:\FR\FM\17JYP4.SGM 17JYP4 33770 Federal Register / Vol. 83, No. 137 / Tuesday, July 17, 2018 / Proposed Rules withdrawing all currently certified schools every 2 years. At present staffing levels, SEVP is able to process 1,939, or 44 percent, of the required annual projected 4,400 recertification cases. 3. Additional Investigatory Support Investigations of violations of immigration status, as well as criminal investigations of F and M students and J exchange visitors, are primarily coordinated by CTCEU. Information is received, collated, and analyzed from a number of DHS and other information sources, including SEVIS, to generate national security leads for field personnel and prevent terrorists and other criminals from exploiting the Nation’s immigration system through fraud. In its continuing support of compliance efforts, SEVP seeks to fund activities in two key areas: Support for and integration of technological advances and surge support for critical incidents. New technologies have enabled sophisticated methods of extracting and analyzing data. To make best use of these technology force multipliers, personnel would use the available technologies to develop investigative packages based on SEVIS research and use of other designated government computer systems, open source websites, and other pertinent information sources related to individual students, exchange visitors, and SEVP-certified schools. To the extent that adequate resources are allocated and employed for this purpose, increased support levels would reduce the vulnerability of the United States to terrorist attacks and reduce the potential for exploitation of certified schools and designated exchange visitor programs. Through the fee adjustments proposed in this rule, SEVP would continue ensuring funding to enable a surge for investigatory efforts, including increased contract overtime or surge staffing, in advance of planned critical overstay enforcement operations. SEVP would also fund the surge of continuous and extended analytic support to HSI field operations in the event of a terrorist attack or during imminent threat situations. This direct operational support to field elements during heightened threat situations or in the aftermath of an attack would enable CTCEU to quickly assess subjects of investigative interest and to share information to further investigations with its law enforcement partners, ICE legal counsel, and the U.S. Attorney’s Office. Such surge support has been used successfully and has proven critical in furthering investigative efforts and providing investigative focus in recent threat situations and terrorist attacks, including attacks in San Bernardino, California; Orlando, Florida; Columbus, Ohio; Baltimore, Maryland; New York; New Jersey; and Fort Lauderdale, Florida. C. Basis for Fee Schedule As previously noted, the proposed amended fees comply with statutory and regulatory requirements that SEVP review its fee structure every 2 years to ensure that the cost of the services provided are fully captured by fees assessed on those receiving the services. The new fees are an estimate of the current and projected costs of funding needed to continue enhancing SEVP’s capability to achieve programmatic goals associated with its statutory mandate—supporting national security and countering immigration fraud through the continued development and implementation of critical system and programmatic enhancements. This proposed rule would establish the following fee structure detailed in Table 3. TABLE 3—PROPOSED FEE STRUCTURE Fee type Responsible party I–901 SEVIS Fee ............................ I–17 Certification Fee ...................... Site Visit Fee ................................... Student or exchange visitor issued an initial Form I–20 or DS–2019 seeking an F, M, or J visa. Institutions petitioning for SEVP certification to enroll international students. Institutions applying for initial certification or certified schools changing locations or adding a campus/location. Certified institutions seeking recertification every 2 years. Institutions that have had certification or recertification denied by SEVP, including denied I–17 updates, or that have had certification withdrawn, and which are filing an appeal or motion regarding the SEVP decision. daltland on DSKBBV9HB2PROD with PROPOSALS4 Recertification Fee .......................... Appeal or Motion Fee ..................... The current fee structure includes the I–901 SEVIS fee, I–17 certification fee, and the site visit fee. The proposed rule would allow SEVP to fully fund activities and institute critical near-term program and system enhancements in a more equitable manner. The proposed fee structure would also include the addition of a recertification fee and a fee for filing a motion or appeal. With this rule SEVP proposes to impose a fee for a Form I–290B, Notice of Appeal or Motion, filed with SEVP at a level that is comparable to the fee for the Form I–290B when filed with USCIS. DHS proposes to eliminate regulations that currently state there is no fee required for an appeal by a school, to maintain consistency with this clarification in the motions context and to more fairly balance allocation of VerDate Sep<11>2014 22:15 Jul 16, 2018 Jkt 244001 the recovery of SEVP operational costs between beneficiary classes. Under this proposal, SEVP would charge the fee for all appeals and motions. The proposed rule would ensure the full recovery of SEVP operational costs in a manner that fairly allocates costs between beneficiary classes and would facilitate the development of activities designed to achieve defined program goals. For example, the proposed rule would continue funding for critical SEVIS modernization efforts and would incorporate the added cost of increased analytical support for investigative and enforcement operations into the I–901 SEVIS fee. The proposed fee schedule would also allow SEVP to fully fund additional SEVP adjudication personnel. PO 00000 Frm 00010 Fmt 4701 Sfmt 4702 D. SEVP Baseline Costs and Fees SEVP fees are paid by individuals and organizations. DHS certifies schools that enroll F and M students; recertifies schools with active certifications; conducts site visits; administers, maintains, and develops SEVIS; collects fees from prospective F and M students and J exchange visitors, as well as from schools; adjudicates motions and appeals in regard to certification petitions; undertakes investigatory initiatives; and provides overall guidance to schools about program enrollment and compliance, as well as the use of SEVIS. These activities are funded solely through the collection of fees. The I–901 SEVIS fee, collected from students and exchange visitors, currently underwrites the operation of E:\FR\FM\17JYP4.SGM 17JYP4 daltland on DSKBBV9HB2PROD with PROPOSALS4 Federal Register / Vol. 83, No. 137 / Tuesday, July 17, 2018 / Proposed Rules SEVP; the cost of administering, maintaining, and developing SEVIS; the cost of school recertification; and all activities related to individual and organizational compliance issues within the jurisdiction of SEVP. These activities include the cost of investigating the compliance of schools participating in SEVP and exchange visitor programs, as well as investigations in which F, M, or J nonimmigrants are identified as potential threats to national security or where it is suspected that an immigration violation or fraud may be occurring. The certification fee is paid by schools that petition for the authority to issue Certificates of Eligibility (COE), commonly referred to as Forms I–20, to prospective nonimmigrant students for the purpose of their applying for F or M visas and admission to the United States in those statuses. These monies fund the base internal cost for SEVP to process and adjudicate the initial school certification petition (Form I–17, ‘‘Petition for Approval of School for Attendance by Nonimmigrant Student’’). The proposed recertification fee paid by schools to remain certified would fund the cost of adjudicating the recertification petition. If SEVP finds that a petitioning or certified school does not meet regulatory standards, it will deny the affected school’s Form I–17 or withdraw its SEVP certification. 8 CFR 214.4. When SEVP sends a school a notice of denial or withdrawal, the notice also includes reasons for the unfavorable decision(s), an explanation of the school’s rights, and the applicable appeal and motion filing information and deadlines. In many cases, a school may file an appeal or motion to reopen and/or reconsider unfavorable decisions issued by SEVP by filing the Form I– 290B, ‘‘Notice of Appeal or Motion,’’ pursuant to the process set forth in 8 CFR 103.3(a) or 103.5(a).7 A school may initiate a motion to reopen or reconsider to request that the original deciding body review the unfavorable decision, including an appeals decision, pursuant to requirements in 8 CFR 103.5(a). A school may also initiate an appeal in order to request review of the unfavorable Notice of Denial, Automatic Withdrawal, or Withdrawal on Notice by an authority independent of the original deciding body. Currently, DHS uses I–901 funds to offset the costs of SEVP appeals and motions. This offset 7 Form I–290B is managed by USCIS and not ICE. USCIS has agreed to the use of the form by ICE for SEVP appeals and the use has been approved by the Office of Management and Budget under control number 1615–0095. VerDate Sep<11>2014 22:15 Jul 16, 2018 Jkt 244001 is a result of the DHS determination in the 2008 final fee rule to state in regulations that no fee would be required for appeals relating to SEVP certification or recertification or a withdrawal of SEVP certification. See 8 CFR 214.4(a)(1), (h). DHS proposes to remove the SEVP-related exceptions to the payment of the I–290B fee and add regulatory text at proposed 8 CFR 103.7(b)(1)(ii)(O) providing for the fee of $675 when the Form I–290B is filed with SEVP. This fee would apply when schools or institutions file an appeal or motion with regard to a denied petition for initial certification or recertification or a withdrawal of certification. In proposing these regulatory changes for the I–290B filing fee, DHS would more fairly balance allocation of the recovery of SEVP operational costs among beneficiary classes. To date, the cost of adjudicating appeals and motions has never been placed directly upon the beneficiaries of those adjudications—the schools seeking to obtain or maintain SEVP-certification. The fee for filing the Form I–290B with SEVP is being proposed at a level that requires those who file the Form I–290B to pay for at least a portion of the operating expenses for DHS to adjudicate the I–290B, while preventing the fee from becoming cost prohibitive. The site visit fee is currently paid by schools that petition for certification to issue Forms I–20 or by a certified school when it physically moves to a new location. DHS established this fee in the 2008 Fee Rule and with that rule codified SEVP’s authority to charge the fee when a school changes its physical location or adds a new physical location or campus. See 8 CFR 103.7(b)(3)(ii)(B), 8 CFR 214.3(h)(3)(i), (h)(3)(ii). Specifically, the 2008 Fee Rule imposed a site visit fee of $655 for each location listed on the Form I–17, and required the Form I–17 to include ‘‘any physical location in which a nonimmigrant can attend classes through the school (i.e., campus, extension campuses, satellite campuses, etc.).’’ See 73 FR 55683, 55698–55699 (amending 8 CFR 103.7(b)(3)(ii)(B) and 214.3(a)(1), respectively). The 2008 Fee Rule also imposed a continuing duty on schools to update school locations as changes arise, i.e., even after initial certification, a school must update SEVIS within 21 days of a change to a range of information types, including school location and campus location. See 73 FR 55683, 55700 (amending 8 CFR 214.3(g)(2), (h)(3)). Consistent with the aforementioned regulatory amendments, the preamble to the 2008 Fee Rule made clear that these provisions require the imposition of a site visit fee for each PO 00000 Frm 00011 Fmt 4701 Sfmt 4702 33771 location listed on the initial SEVP certification, as well as each location added as part of an initial event, such as a SEVIS update requesting approval of a changed or new location or campus. 73 FR 55683, 55691. But SEVP is not currently collecting the fee when a certified school adds a new physical location or campus. SEVP intends to begin imposing the fee following the effective date of any final rule. The site visit fee would apply when a certified school updates its Form I–17 in SEVIS to indicate, pursuant to 8 CFR 214.3(h)(3)(ii), it is changing its physical location or adding a new physical location or campus. This revenue would assist in recovering the costs DHS incurs for site visits of these locations, including collecting evidence on school eligibility for certification, reviewing the facilities, and interviewing personnel nominated on the petition to become DSOs, including the person nominated to be the PDSO. E. Methodology SEVP captured and allocated cost using an ABC approach to define full cost, outline the sources of SEVP cost, and define the fees. The ABC approach also provides detailed information on the cost and activities allocated to each fee. 1. ABC Approach SEVP used CostPerform ABC modeling software, Version 9.3 (0147), to determine the full cost associated with updating and maintaining SEVIS to collect and maintain information on F, M, and J nonimmigrants; certifying schools; overseeing school compliance; recertifying schools; adjudicating appeals; investigating suspected violations of immigration law and other potential threats to national security by F, M, or J nonimmigrants; providing outreach and education to users; and performing regulatory and policy analysis. SEVP also used the model to identify management and overhead costs associated with the program. ABC is a business management methodology that links inputs (cost) and outputs (products and services) by quantifying how work is performed in an organization (activities). The ABC methodology allows fee-funded organizations to trace service costs and to calculate an appropriate fee for the service, based on the cost of activities associated with the services for which the fee is levied. Using the ABC methodology, SEVP identified and defined the activities needed to support SEVP functions to include current and future initiatives. SEVP captured the full cost of E:\FR\FM\17JYP4.SGM 17JYP4 33772 Federal Register / Vol. 83, No. 137 / Tuesday, July 17, 2018 / Proposed Rules operations and apportioned that full cost to the appropriate program activities. The full cost of each activity is then assigned to the appropriate fee category based on the nature of the activity, as described further below. By tracking costs to the various fee categories, SEVP was able to use forecasted payments to determine the appropriate fee amount for each fee type. SEVP examined historical data and performed statistical payment analysis to forecast payments in future years. SEVP used an independent contractor and commercially available ABC software to compute the fees. The structure of the software was tailored to SEVP needs for continual and real-time fee review and cost management. 2. Full Cost In building the ABC model, it was critical for SEVP to identify the sources and cost for all elements of the program. Consistent with instructive legislative and regulatory guidance, SEVP fees recoup the full cost of providing the agency’s overall resources and services.8 To the extent applicable, SEVP used the cost accounting concepts and standards recommended in the FASAB Handbook, Version 15, ‘‘Statement of Financial Accounting Standards Number 4, Managerial Cost Accounting Concepts and Standards for the Federal Government’’ (2016). FASAB Standard Number 4 sets the following five standards as fundamental elements of managerial cost accounting: (1) Accumulate and report cost of activities on a regular basis for management information purposes; (2) establish responsibility segments and match the cost of each segment with its outputs; (3) determine the full cost of government goods and services; 9 (4) recognize the costs of goods and services provided among federal entities; and (5) use appropriate costing methodologies to accumulate and assign costs to outputs. SEVP calculates projected fees using the full cost of operations, as defined by a regularly updated spend plan. The projected spend plans for FY 2019 and FY 2020 were used in calculation of SEVP’s proposed fee structure. Tables 4 through 7 detail the full cost of SEVP operations, consistent with the spend plan, from various perspectives: By program category, by cost initiative, by fee type, and by activity. 3. Cost Basis for SEVP Fees Based on Current Services The FY 2019 and FY 2020 budgets provide the cost basis for the fees. These budgets reflect the required revenue to sustain current initiatives. The revenue is also assessed to ensure a sufficient level of continued funding for program enhancements as discussed above, such as enhanced vetting and investigative analysis to support enforcement operations, SEVIS Modernization, and increased numbers of adjudication personnel. Finally, the past budgets provide the cost basis for adjusting annualized cost-of-living increases. Determining the projected cost for continuation of current efforts involved routine budget projection processes. The budget establishes the current services of the program and projects the mandatory and cost-of-living adjustments necessary to maintain current services. The budget adjusts the services provided by SEVP to include enhancements that reflect program policy decisions. Table 4 reflects the FY 2017 final budget, the FY 2018 approved budget, and the FY 2019 and FY 2020 planned budget requests. TABLE 4—STUDENT AND EXCHANGE VISITOR PROGRAM SUMMARY OF REQUIREMENTS BY ORGANIZATION AND PROGRAM CATEGORY [Dollars in thousands] 2017 spend plan SEVP expenses 2018 spend plan 2019 spend plan 2020 spend plan SEVP Payroll Full-Time Equivalent Personnel ....................................................................... Executive Office ............................................................................................... Fee Management Section ............................................................................... Field Representative Unit ................................................................................ Policy Section .................................................................................................. Systems Management Unit ............................................................................. SEVP Response Center Section ..................................................................... School Certification Unit .................................................................................. SEVP Analysis and Operations Section .......................................................... New Required Positions .................................................................................. Office of the Principal Legal Advisor ............................................................... SEVP Outside Positions .................................................................................. 134 $1,735 $1,350 $6,480 $1,178 $1,258 $652 $2,993 $1,070 ........................ $328 $1,444 175 $1,744 $1,597 $6,958 $969 $1,299 $652 $2,966 $1,226 $296 $517 $1,776 221 $2,048 $1,775 $7,641 $1,283 $1,391 $931 $3,291 $1,402 $2,357 $642 $2,545 221 $2,084 $1,806 $7,776 $1,325 $1,416 $941 $3,349 $1,388 $5,610 $659 $2,629 Total SEVP Payroll ................................................................................... $18,488 $20,000 $25,306 $28,983 Advisory and Assistance Services .................................................................. SEVIS (Modernization and O&M) * .................................................................. Interagency Agreements with other agencies ................................................. Travel ............................................................................................................... Service-wide Costs .......................................................................................... $58,630 $8,237 $8,046 $1,474 $3,222 $58,108 $18,722 $9,815 $1,500 $4,015 $52,755 $22,241 $8,360 $1,100 $2,400 $50,977 $21,912 $8,583 $1,100 $2,400 Total Program Expenses .......................................................................... $79,609 $92,160 $86,856 $84,972 daltland on DSKBBV9HB2PROD with PROPOSALS4 Program Expenses 8 These include but are not limited to: Direct and indirect personnel cost, including salaries and fringe benefits, such as medical insurance and retirement; retirement cost, including all (funded or unfunded) accrued cost not covered by employee contributions, as specified in OMB Circular A–11; VerDate Sep<11>2014 22:15 Jul 16, 2018 Jkt 244001 overhead, consulting, and other indirect cost, including material and supply cost, utilities, insurance, travel, as well as rents or imputed rents on land, buildings, and equipment; management and supervisory cost; and cost of enforcement, PO 00000 Frm 00012 Fmt 4701 Sfmt 4702 collection, research, establishment of standards, and regulation. 9 Full cost includes the costs associated with resources that directly or indirectly contribute to the output and supporting services within the entity and from other entities. E:\FR\FM\17JYP4.SGM 17JYP4 Federal Register / Vol. 83, No. 137 / Tuesday, July 17, 2018 / Proposed Rules 33773 TABLE 4—STUDENT AND EXCHANGE VISITOR PROGRAM SUMMARY OF REQUIREMENTS BY ORGANIZATION AND PROGRAM CATEGORY—Continued [Dollars in thousands] 2017 spend plan SEVP expenses 2018 spend plan 2019 spend plan 2020 spend plan CTCEU ............................................................................................................. $67,200 $74,450 $74,450 $74,450 Total, SEVP .............................................................................................. $165,297 $186,610 $186,612 $188,405 * Includes costs for the SEVIS Modernization and SEVIS Operations and Maintenance. F. Summary of the Full Cost Information The total cost projection for FY 2019 is $186,612,000 and for FY 2020 is $188,405,000. Table 4 sets out the projected current services for SEVP and supporting CTCEU personnel in FY 2019 ($74.45 million) and FY 2020 ($74.45 million). These costs are direct extensions of the FY 2018 costs that are supported by the current fees. Table 5 summarizes the enhancements and other costs, which include investigative analysis to support enforcement operations, SEVIS Modernization, increased numbers of adjudication personnel, and annualized inflation. TABLE 5—FY 2018, FY 2019 AND FY 2020 SEVP COST BY INITIATIVE FY 2018 budgeted cost (thousands) FY 2019 budgeted cost (thousands) FY 2020 budgeted cost (thousands) $95,097 70,200 $94,497 70,200 $95,106 70,200 Subtotal ......................................................................................................................... Enhancements and Other Costs: Investigative Analysis Support ............................................................................................. SEVIS Modernization ........................................................................................................... Increased Personnel ............................................................................................................. Annualized Inflation .............................................................................................................. 165,297 164,697 165,306 4,250 13,150 1,100 2,813 4,250 13,750 1,100 2,813 4,250 13,141 3,500 2,208 Subtotal ......................................................................................................................... 21,313 21,913 23,099 Total ....................................................................................................................... 186,610 186,610 188,405 Program cost by initiative Program Base: SEVP (Current operational costs) ........................................................................................ CTCEU (Current operational costs) ..................................................................................... daltland on DSKBBV9HB2PROD with PROPOSALS4 1. Fee Allocation The purpose of the ABC methodology is to trace costs to organizational elements, as well as identify all cost components associated with the services offered. For fee-based organizations such as SEVP, this allows the assignment of cost to one or more fees. SEVP defined five fee categories: The I– 901 SEVIS fee, certification fee, recertification fee, fee for motions and appeals, and site visit fee. Historically SEVP has only collected fees from students and exchange visitors—the I–901 fee—and from schools applying for certification, to include a separate site visit fee. In this analysis, SEVP considered the creation of additional fee categories for all the distinct services it provides in deciding how to apportion fees. For example, SEVP considered charging a separate I– 901 SEVIS fee to F, M, and J VerDate Sep<11>2014 22:15 Jul 16, 2018 Jkt 244001 dependents. SEVP also examined various tiered fee structures and considered assigning some specific costs to separate fees. The ABC fee model allowed SEVP to evaluate these scenarios. DHS opted for an updated fee structure that segments program cost to the appropriate fee—F and M students, J exchange visitors, or schools. The proposed I–901 SEVIS fee would recover the systems cost for SEVIS, including the remainder of certification, recertification, site visits, as well as appeals and motions costs that are not covered by the respective proposed fees. The fee would be apportioned between three categories—full fee of $350 for F and M students, reduced fee of $220 for most J participants, and the further reduced fee of $35 for certain J program participants. Federal Governmentsponsored J program participants are fee-exempt by law, so their costs will be PO 00000 Frm 00013 Fmt 4701 Sfmt 4702 funded by other fee payers. 8 U.S.C. 1372(e)(3). The proposed school certification fee would recover a portion of the costs necessary to process initial school certifications. The proposed recertification fee would recover a portion of the cost to process school recertifications and a portion of SEVP administrative costs. The site visit fee would recover the full cost of performing the site visit for initial school certification and when a school changes its physical location or adds a new physical location or campus. The proposed fee for an appeal or motion would recover a portion of the cost to process an appeal or motion. 2. SEVP FY 2019 and FY 2020 Cost Model Results Table 6 shows the summary of SEVP FY 2019 and FY 2020 cost by source of cost. E:\FR\FM\17JYP4.SGM 17JYP4 33774 Federal Register / Vol. 83, No. 137 / Tuesday, July 17, 2018 / Proposed Rules TABLE 6—TOTAL SEVP FY 2019 AND FY 2020 COST BY FEE CATEGORY FY 2019 budgeted cost (thousands) FY 2020 budgeted cost (thousands) I–901 SEVIS Fee ..................................................................................................................................................... I–17 Certification Fee .............................................................................................................................................. I–17 Recertification Fee ........................................................................................................................................... Site Visit Fee ........................................................................................................................................................... Appeals Fee ............................................................................................................................................................. $159,835 1,909 22,522 385 1,956 $160,633 1,992 23,189 389 2,198 Total .................................................................................................................................................................. 186,607 188,401 SEVP ABC model output category Table 7 shows a more detailed cost breakdown. The numbers are shown in thousands, rather than millions, of dollars due to the level of detail. There are two levels for the costs: Process and activity. Costs are allocated from Table 7 details these costs from an activity perspective. To simplify the presentation, the numbers are rounded to the nearest thousand. These numbers are not rounded in the cost model. payroll, contracts, and other expenses to activities through activity surveys and volume based cost allocations. The full cost of operations from the spend plans is distributed to the activities that best describe the work being performed. TABLE 7—DETAILED COST BREAKDOWN [FY 19 + FY 20, dollars in thousands] Process Activity I–901 I–17 certification I–17 re-certification I–17 site visit Appeals Certify Schools ................ A–01: Certify schools (initial certification) ............... A–02: Recertify schools ........................................... A–03: Notify students if school is withdrawn .......... A–04: Withdraw schools from SEVIS ...................... A–05: Process appeals/motions .............................. A–06: Process petition updates .............................. A–07: Monitor school compliance ........................... A–08: Monitor school risk ........................................ A–28: Conduct Student and Exchange Visitor (I– 901) investigations. A–29: Conduct school and sponsor investigations A–30: Operate CTCEU programs ........................... A–31: Provide CTCEU liaison support .................... A–41: Perform I–515 operations duties .................. A–43: PDSO/DSO background checks ................... A–16: Analyze and develop policy .......................... A–17: Develop and review rules and regulations ... A–18: Implement policy ........................................... A–19: Develop future policy strategy ...................... A–11: Develop and deliver SEVP communications A–12: Respond to stakeholders’ policy and technical inquiries (including Tier III Help Desk). A–13: Provide Field Representative support .......... A–14: Prepare and attend conferences/workshops related to the SEVIS community. A–15: Develop and conduct strategic communications. A–20: Modify and enhance functionality of SEVP mission systems (e.g., SEVIS, SEVPAMS 10). ........................ ........................ ........................ ........................ ........................ ........................ ........................ ........................ $93,921 $3,115 ........................ ........................ ........................ ........................ ........................ ........................ ........................ ........................ ........................ $4,614 129 1,102 ........................ 3,036 3,761 3,446 16,574 ........................ ........................ ........................ ........................ ........................ ........................ ........................ ........................ ........................ ........................ ........................ ........................ ........................ $3,420 ........................ ........................ ........................ ........................ 34,238 4,130 417 1,471 1,038 3,170 2,476 1,501 816 9,040 8,218 ........................ ........................ ........................ ........................ ........................ ........................ ........................ ........................ ........................ 118 ........................ 6,042 729 74 ........................ 54 600 469 284 154 1,224 ........................ ........................ ........................ ........................ ........................ ........................ ........................ ........................ ........................ ........................ 24 ........................ ........................ ........................ ........................ ........................ ........................ ........................ ........................ ........................ ........................ 130 ........................ 13,731 3,404 ........................ 62 2,598 644 ........................ 13 ........................ 68 2,699 49 511 ........................ ........................ 24,816 ........................ ........................ ........................ ........................ A–21: Operate and maintain SEVP mission systems (e.g., SEVIS, SEVPAMS). A–22: Provide Tier I and Tier II Help Desk support A–23: Conduct systems program management ...... A–24: Analyze and disseminate program data ....... A–25: Operate and maintain SEVP inter-office systems. A–26: Maintain SEVP systems security .................. A–27: Maintain SEVP physical security .................. A–32: Provide Executive Leadership for SEVP ...... A–33: Provide SEVP administrative support ........... A–34: Develop strategic plan .................................. A–35: Manage financial resources .......................... A–36: Manage procurement .................................... A–37: Manage personnel resources ....................... A–38: Manage SEVP records ................................. A–39: Manage facility resources ............................. A–40: Manage I–901 payment system ................... A–42: Manage I–901 J program ............................. A–44: Site Visits ...................................................... A–09: Develop and deliver SEVIS training ............. A–10: Develop and deliver internal training ............ 28,491 ........................ ........................ ........................ ........................ 12,814 5,291 3,510 1,735 ........................ ........................ 46 32 ........................ ........................ 475 328 ........................ ........................ 9 ........................ ........................ ........................ 50 ........................ 2,867 223 2,539 1,599 1,612 7,300 1,886 2,065 3,274 1,782 7,766 15,966 ........................ 5,936 2,613 37 4 33 21 29 95 25 27 60 23 ........................ ........................ ........................ 78 48 388 42 344 217 305 988 256 280 619 241 ........................ ........................ ........................ 803 494 ........................ 1 7 4 6 20 5 6 12 5 ........................ ........................ 638 16 10 ........................ 4 36 23 32 105 27 30 66 25 ........................ ........................ ........................ 85 52 .................................................................................. 314,355 3,902 51,827 775 4,155 Enforce Compliance with Regulations and Laws. Formulate Policy ............. Provide Stakeholder Communications. Provide Systems Program Management Support. daltland on DSKBBV9HB2PROD with PROPOSALS4 Support SEVP Operations. Train SEVP staff, other staff, and DSOs. Total ......................... VerDate Sep<11>2014 22:15 Jul 16, 2018 Jkt 244001 PO 00000 Frm 00014 Fmt 4701 Sfmt 4702 E:\FR\FM\17JYP4.SGM 17JYP4 33775 Federal Register / Vol. 83, No. 137 / Tuesday, July 17, 2018 / Proposed Rules 3. Fee Calculations The cost model provides detailed cost information by activity and a summary cost for each, giving the aggregate fee cost by category. Next, SEVP projected the total number of fee payments of each type for FY 2019 and FY 2020 and determined the fee-recoverable budget. SEVP selected a forecasting approach to determine the total number of expected fee payments for each fee. a. I–901 SEVIS Fee To calculate a fee amount for the I– 901 SEVIS fee, SEVP estimated the number of fee payments expected in FY 2019 and FY 2020 for each of the three fee payment types: Reduced fee for J participants (excluding the additional cost for initial certification and recertification of SEVP-certified schools); full fee for J participants (excluding the additional cost for initial certification and recertification of SEVPcertified schools); and full fee for F and M students (including additional costs for certification, recertification, and appeals). Calculations for each of the three fee payment types vary because each fee type is treated differently in federal statutes and regulations. Section 641 of IIRIRA exempts Federal Governmentsponsored J–1 exchange visitors from the fee payment. All F and M nonimmigrant students are currently required to pay $200, and nonexempt J nonimmigrant exchange visitors currently must pay $180. 8 CFR 103.7(b)(1)(ii)(H); 214.13(a). Congress modified the statute in December of 2000 to establish a reduced fee of $35 for au pairs, camp counselors, or participants in a summer work travel program, demonstrating strong congressional intent that the fee remain at that level. Act of Dec. 21, 2000, Public Law 106–553, app. B, sec. 110, 114 Stat. 2762, 2762A–51, 2762A–68. IIRIRA also provided for revising the fee once the program to collect information was expanded to include information collection on all F, M, and J nonimmigrants. As a result, the I–901 fee was revised in 2008 under the provisions of IIRIRA to take into account the actual cost of carrying out the program. See 73 FR 55683. The I– 901 fee is now being revised a second time, through this rule, due to an increase in the actual cost of carrying out the program. SEVP determined the number of expected I–901 SEVIS fee payments in FY 2019 and FY 2020. SEVP calculated the I–901 SEVIS fee over a 2-year period to account for potential fluctuation in the forecast. SEVP used the change in the numbers of payments received to provide the trend data used to forecast I–901 SEVIS fee payments for each I– 901 payment type separately. Table 8 reflects aggregate historical payment data for all three I–901 payment types. TABLE 8—F, M, AND J VISA ISSUANCE 2007–2017 Fiscal year 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Total .......... .......... .......... .......... .......... .......... .......... .......... .......... .......... .......... 697,054 753,065 644,912 699,983 749,082 744,027 767,805 829,636 885,728 866,623 796,820 Growth rate* ........................ 8.0 ¥14.4 8.5 7.0 ¥0.7 3.2 8.1 6.8 ¥2.2 ¥8.1 * Growth rate rounded to nearest tenth of a percent. As indicated in Table 8, the level of payments received varied greatly over the past 10 years. This high degree of variation in the historical data, combined with the variables affecting demand for visas, called for a forecasting methodology that would capture and account for deviations. SEVP selected a statistical forecasting method that uses trends in historical data to forecast future payments. SEVP selected ARIMA, an autoregressive integrated moving average model to forecast payments. An ARIMA model is a statistical model that uses historical time series data to predict future trends and movements. A non-seasonal model incorporates two major components: Trend and moving average. The autoregressive portion of the model, or trend, states that past values have an effect on current or future values and that values are estimated based on the weighted sum of past values. The second component is moving average which helps to smooth out the time series to filter out extreme fluctuations or outliers. In some cases a third component is needed: Seasonality. Visa data from 2004 to the present shows extreme seasonality in the number of F, M, and J visas issued. Seasonality is factored into the model to account for the U.S. academic calendar. SEVP evaluated alternative forecasting methods; however, SEVP rejected these methods due to inaccuracy and poor fit. SEVP’s chosen model provided a conservative forecast that will allow SEVP to operate with stability. The fee payment forecast, reflected in Table 9, places a balanced mix of emphasis on recent and historical data and still contains sufficient data points to smooth out some variability in the underlying data. TABLE 9—I–901 SEVIS FEE PAYMENT FORECAST FY 2019–FY 2020 I–901 Payment type FY 2019 FY 2020 Full Payments, F/M .................................................................................................................................................. Full payment, J-Full ................................................................................................................................................. Subsidized, J-Partial ................................................................................................................................................ 418,393 157,550 158,945 407,933 153,611 158,945 Total .................................................................................................................................................................. 734,888 720,490 daltland on DSKBBV9HB2PROD with PROPOSALS4 b. Certification Cost SEVP uses historical data from FY 2012 to FY 2016 to find a 3-year moving average to forecast annual new initial certifications. SEVP predicts demand of approximately 426 initial certifications each year. SEVP assumes that the 10 SEVP proposed higher fee will not deter schools from applying for certification. TABLE 10—THREE-YEAR MOVING AVERAGE OF THE NUMBER OF SCHOOL CERTIFICATION PAYMENTS RECEIVED Fiscal year 2012 .......... 2013 .......... Automated Management System. VerDate Sep<11>2014 22:15 Jul 16, 2018 Jkt 244001 PO 00000 Frm 00015 Fmt 4701 Sfmt 4702 E:\FR\FM\17JYP4.SGM 17JYP4 Payments received 457 382 3-Year moving average ........................ ........................ 33776 Federal Register / Vol. 83, No. 137 / Tuesday, July 17, 2018 / Proposed Rules TABLE 10—THREE-YEAR MOVING AV- F and M SEVIS fee, which is addressed ERAGE OF THE NUMBER OF SCHOOL below. CERTIFICATION PAYMENTS RE- c. Recertification Cost CEIVED—Continued To identify a fee level that would Fiscal year 2014 .......... 2015 .......... 2016 .......... Payments received 3-Year moving average 446 469 363 428 432 426 The total fee category budget is taken directly from the FY 2019 and FY 2020 SEVP ABC model, reflected in Table 11. TABLE 11—FY 2019–FY 2020 CERTIFICATION FEE-RECOVERABLE BUDGET Fiscal year Certification payments expected recover the full cost of recertification operations, SEVP determined the full cost of recertification (including level of effort and contract cost) and the approximate number of schools willing to recertify. Because schools are required to recertify every 2 years, SEVP anticipates that approximately one-half of its certified schools—roughly 4,373 schools per year, given the current certified school population of 8,746— would recertify. d. Site Visit Cost TABLE 12—FY 2019–FY 2020 RESite visits consist of initial CERTIFICATION FEE-RECOVERABLE certification site visits, change of BUDGET Fee-recoverable budget Fiscal year 426 426 852 3,902,558 Recertification payments expected 2019 .......... 2020 .......... 4,373 4,373 $25,368,650 26,457,896 Total ... 8,746 School certification fees are calculated by dividing the feerecoverable budget by the anticipated number of payments. This results in a fee-recoverable amount from schools of $4,580 each. To arrive at the proposed fee, rounding was applied to the result of the fee algorithm. This results in a certification fee of $4,600 per school. Setting the certification fee at the $4,600 figure, however, leads to an increase of the current school certification fee by $2,900, resulting in a certification fee over twice the current fee amount. School certification is integral to SEVP—F and M nonimmigrant students can only attend SEVP-certified schools. DHS is concerned that such an increase of the school certification fee would appear dramatic to schools seeking initial certification and could lead to fewer schools seeking initial certification, so DHS proposes to keep the fee increase at a level that will not discourage potential new schools from seeking certification. At the same time, DHS considers that initial certification bestows upon the school a valuable asset, the ability to enroll F and M nonimmigrant students, and an increased fee amount is reasonable as the initial certification process becomes more extensive through the SEVIS modernization and other technological developments. Weighing these concerns, DHS decided to subsidize the I–17 certification fee by increasing the payment by only $1,300 to $3,000. The remainder of the costs for I–17 certification is subsidized by the I–901 VerDate Sep<11>2014 22:15 Jul 16, 2018 Jkt 244001 location visits, and new campus or location site visits. The anticipated workload for these site visits is 600 per year, or 1,200 visits over a 2-year period. 51,826,546 $1,909,680 1,992,878 Total ... daltland on DSKBBV9HB2PROD with PROPOSALS4 2019 .......... 2020 .......... nonimmigrant status. Weighing all these factors, DHS proposes that the I–17 recertification fee be $1,250. DHS proposes to eliminate regulations that state that no fee is required for the school recertification process in order to recover part of this cost, as part of an effort to establish a more equitable distribution of costs and more sustainable level of cost recovery relative to services provided. The costs for I–17 recertification not recovered by the proposed fee would be subsidized by the I–901 F and M SEVIS fee. The explanation for shifting responsibility of the fee adjustment to the I–901 fee is included below. Fee-recoverable budget To calculate an anticipated school recertification fee, DHS divides the feerecoverable budget by the anticipated number of payments. This results in a fee-recoverable amount from schools of $6,000 each. To arrive at the proposed fee, rounding was applied to the result of the fee algorithm. This would result in a recertification fee of $6,000 per school. DHS desires to institute a recertification fee to more accurately assign the costs of recertification adjudication to those stakeholders who are directly requesting the adjudication—the SEVP-certified schools—particularly since the costs of recertification continue to increase as the recertification process becomes more robust. DHS considers, however, that a recertification fee instituted in this rule for the first time should not be set at a level that could discourage schools from seeking recertification. DHS also considers that the recertification amount should be less than the initial certification amount so that schools are encouraged to seek recertification instead of allowing their SEVP certification to be withdrawn and applying for initial certification anew at some later date. Withdrawal of SEVPcertification not only leads to the school losing a valuable asset, but also leads to complications for F and M nonimmigrant students enrolled in the withdrawn school, who are then forced to transfer schools, leave the United States, or risk facing immigration law penalties for violating the terms of their PO 00000 Frm 00016 Fmt 4701 Sfmt 4702 TABLE 13—FY 2019–FY 2020 SITE VISIT FEE-RECOVERABLE BUDGET Fiscal year Site visit payments expected Fee-recoverable budget 2019 .......... 2020 .......... 600 600 $385,674 389,689 Total ... 1,200 775,363 The current fee amount is $655 as established in the 2008 Fee Rule that codified SEVP’s authority to charge the fee when a school changes its physical location or adds new physical location or campus. Following this rule’s effective date, SEVP will collect the fee when a school adds a new physical location or campus. The site visit fee would apply when a certified school updates its Form I–17 in SEVIS to indicate, pursuant to 8 CFR 214.3(h)(3)(ii), an added physical location or campus. The site visit fee is based on level of effort for both SEVP staff and contracts that cover the cost of operations. e. Appeals and Motions Cost Determining the full cost of processing an appeal is essential to improving the fee structure. The fee for filing a motion or appeal is calculated by determining the workload of appeals and motions over the FY 2019 and FY 2020 periods. Over the past 2 years, SEVP has processed 54 appeals and motions annually. To maintain conservative estimates, SEVP anticipates that number will remain constant over the FY 2019 and FY 2020 periods. E:\FR\FM\17JYP4.SGM 17JYP4 Federal Register / Vol. 83, No. 137 / Tuesday, July 17, 2018 / Proposed Rules TABLE 14—FY 2019–FY 2020 APPEALS FEE-RECOVERABLE BUDGET Fiscal year Appeal and motion payments expected would charge the fee for all such appeals and motions. 4. Proposed Fee Levels Fee-recoverable budget 2019 .......... 2020 .......... 54 54 $1,956,375 2,198,825 Total ... 108 4,155,200 Fees for motions or appeals are calculated by dividing the feerecoverable budget by the anticipated number of payments over the FY 2019 and FY 2020 periods. This results in a fee-recoverable amount of $38,474 for each appeal. To arrive at the proposed final cost, rounding was applied to the result of the fee algorithm. This results in a cost for a motion or appeal of $38,500. SEVP believes that this fee, while justified, is too high to impose on the affected schools as the first fee to be established and collected for the subject appeals and motions, and that some accommodation should be made to keep the fee at a more reasonable amount. Instead, DHS proposes adding $4.76 to the Form I–901 F and M fees to counterbalance the unfunded costs of adjudicating appeals and motions. This will better ensure that cost is not a significant obstacle in pursuing an administrative appeal or motion. The Form I–290B fee when filed with SEVP would be set at $675, which is currently the same amount charged when the form is filed with USCIS. See 8 CFR 103.7(b)(i)(S).11 The Form I–290B, ‘‘Notice of Appeal or Motion,’’ filed with USCIS is the same form used for appeals or motions related to any denial of school certification or recertification or a withdrawal of such certification. Although the appeal fee would not be set at the amount necessary to recover the full costs of appeals and motions, by setting a fee of $675, schools that benefit from the appeal process would bear some of its costs, and DHS would more fairly balance allocation of the recovery of SEVP operational costs between beneficiary classes. As proposed, DHS Viewing the SEVP fee structure and affected parties comprehensively, DHS proposes to adjust each fee in its fee structure based not only on cost of services, but also on the desire to spread the impact of fee increases reasonably among the various beneficiaries of SEVP services. Despite the ABC calculations’ determination of the actual cost of each service, which is represented by each fee, DHS has determined that using the I–901 revenue to subsidize the costs of the SEVP’s other fees is an appropriate course of action for two reasons. First, the number of F and M students paying the I–901 fee is substantially larger than the number of entities paying each of the school certification-related fees, allowing for SEVP to lessen the impact of fee increases in the aggregate. Second, the subsidization is reasonable because individuals paying the I–901 fee necessarily benefit from the continued certification of schools for their enrollment and prompt and accurate adjudication of appeals. DHS proposes to increase the I–901 SEVIS fee for F and M students from $200 to $350 and the full I–901 SEVIS fee for most J exchange visitors from $180 to $220. While these increases may seem large, these fees have been unchanged since 2008. 73 FR 55683 (Sept. 26, 2008). In 2008, the first time these fees had been updated since SEVP’s inception in 2004, the I–901 SEVIS fee for F and M students increased from $100 to $200, and the full I–901 SEVIS fee for most J exchange visitors increased from $100 to $180. See id. The I–901 SEVIS fee for special J-visa categories (au pair, camp counselor, and summer work travel) would remain at the current $35 level, consistent with the levels set by Congress in 8 U.S.C. 1372(e)(4)(A). IIRIRA also exempts from the I–901 SEVIS fee J–1 exchange visitors who participate in Federal Governmentsponsored J–1 exchange programs, consistent with 8 U.S.C. 1372(e)(3). 33777 DHS proposes to increase the initial certification fee from $1,700 to $3,000. This fee was originally set at $230, effective in 2002, prior to the reorganization of the Immigration and Naturalization Service (INS) to become part of DHS. See 66 FR 65811 (Dec. 21, 2001). The fee was increased in 2008 to $1,700. See 73 FR 55683. This is the base fee for certification and does not include the site visit fee. DHS proposes to establish a recertification fee at $1,250, maintain the site visit fee of $655, and set the I– 290B fee at $675. The cost for SEVP recertification, site visits, and motions and appeals adjudication is determined by employing ABC principles, previously described in this document, balanced with SEVP’s desire to prevent recertifications, site visits, appeals, and motions filings from becoming cost prohibitive. DHS is proposing a recertification fee and a Form I–290B fee for the first time, and SEVP believes that charging recertification and appeals fees sufficient to recover, on their own, the fee-recoverable amount for such services, may result in inordinately high fees from the perspective of entities who have regularly received the benefits of these SEVP services at no additional charge. Accordingly, DHS proposes to set these fees at amounts below the feerecoverable cost. For the I–290B fee in particular, DHS proposes to set the amount at $675. DHS believes this amount is appropriate because it is less than both the fee for initial certification and the fee for recertification. Further, the amount $675 is already associated with the Form I–290B when filing it with USCIS. DHS believes $675 is a logical starting point, because this is the fee currently being charged by USCIS for motions and appeals. While the difference between the fee-recoverable amount (approximately $38,500) and the proposed fee of $675 is substantial, subsidizing this fee by driving the additional costs to the I–901 fee results in an increase of only $4.76 to F/M students paying that fee. The proposed program fee schedule for SEVP beginning in FY 2019 is shown in Table 15. daltland on DSKBBV9HB2PROD with PROPOSALS4 TABLE 15—PROPOSED FY 2019 SEVP FEES Category Amount I–901 SEVIS Fees: • I–901 Primary F/M visa holders (Full) ...................................................................................................................................... • I–901 Primary J visa holders (Full) ........................................................................................................................................... • I–901 Special J-visa categories (Subsidized payment) ............................................................................................................ I–17 School Fee: ........................ $350 220 35 ........................ 11 Because the underlying rationale for the amount of the I–290B fee differs between SEVP and VerDate Sep<11>2014 22:15 Jul 16, 2018 Jkt 244001 USCIS, the cost for appealing a claim or petition PO 00000 Frm 00017 Fmt 4701 Sfmt 4702 using the I–290B Form could eventually be different for SEVP and USCIS 8 CFR 103.7(b)(1)(i)(S). E:\FR\FM\17JYP4.SGM 17JYP4 33778 Federal Register / Vol. 83, No. 137 / Tuesday, July 17, 2018 / Proposed Rules TABLE 15—PROPOSED FY 2019 SEVP FEES—Continued Category Amount • Certification Fee ........................................................................................................................................................................ • Recertification Fee .................................................................................................................................................................... • Site visit fee for initial certification (base fee to be multiplied by number of locations cited on the Form I–17), and for new physical locations ...................................................................................................................................................................... Appeal or Motion Fee: • Appeal or Motion Fee ............................................................................................................................................................... These proposed fee amounts, the cost model outputs, and cost reallocation amounts are shown in Table 16. The cost reallocation amounts are negative for the fees that are subsidized. The cost reallocation amounts that are positive 3,000 1,250 655 ........................ 675 are the amounts per fee that subsidize the other fee categories. TABLE 16—PROPOSED FEE ADJUSTMENT AMOUNTS Current fee Activity based cost model output Cost reallocation Final fee Change in fees % Change in fee (a) Fee (b) (c) (d = b + c) (e) (f = (d/a) ¥1) Appeal or Motion Fee: I–290B ................. I–901 F/M ................................................. I–901 J-Full .............................................. I–901 J-Partial .......................................... I–17 Initial Certification ............................ I–17 Recertification .................................. Site Visit—initial ....................................... Site Visit—new location ........................... N/A 200 180 35 1,700 N/A 655 0 Table 17 reflects the break-even analysis based on the proposed fee $38,475 290 123 123 4,600 6,000 650 650 ($37,800) 60 97 (88) (1,600) (4,750) 5 5 $675 350 220 35 3,000 1,250 655 655 schedule and the proportional fee volumes (rounded) required to generate $675 150 30 0 1,300 1,250 0 655 N/A 75 22 0 76 N/A 0 N/A sufficient revenue to offset projected program costs. TABLE 17—PROJECTED REVENUE—FY 2019 AND FY 2020 Proposed fee amount Fee category I–901 F/M Full .............................................................................................................................. I–901 J-Full .................................................................................................................................. I–901 J-Partial .............................................................................................................................. I–901 Subtotal: Certification Fee ................................................................................................................... Recertification Fee ................................................................................................................ Site Visit ................................................................................................................................ I–17 Subtotal: Appeals ................................................................................................................................. Total ............................................................................................................................... VI. Statutory and Regulatory Requirements daltland on DSKBBV9HB2PROD with PROPOSALS4 A. Executive Orders 12866, 13563, and 13771: Regulatory Review Executive Orders 12866 (‘‘Regulatory Planning and Review’’) and 13563 (‘‘Improving Regulation and Regulatory Review’’) direct agencies to assess the costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health, and safety effects; distributive impacts; and equity). Executive Order 13563 VerDate Sep<11>2014 22:15 Jul 16, 2018 Jkt 244001 Frm 00018 Fmt 4701 Sfmt 4702 Forecasted revenue $350 210 35 826,326 311,162 317,890 $289,214,144 68,455,584 11,126,150 3,000 1,250 655 852 8,746 1,200 2,556,000 10,932,500 786,000 675 ........................ 108 1,466,284 72,900 383,143,278 emphasizes the importance of quantifying both costs and benefits, reducing costs, harmonizing rules, and promoting flexibility. Executive Order 13771 (‘‘Reducing Regulation and Controlling Regulatory Costs’’) directs agencies to reduce regulation and control regulatory costs and provides that ‘‘for every one new regulation issued, at least two prior regulations be identified for elimination, and that the cost of planned regulations be prudently managed and controlled through a budgeting process.’’ The Office of Management and Budget (OMB) has designated this rule a ‘‘significant regulatory action,’’ although PO 00000 Forecasted volume not economically significant under section 3(f) of Executive Order 12866. Accordingly, the rule has been reviewed by OMB. This proposed rule would impose transfer payments between the public and the government. Thus, this proposed rule is not expected to be subject to the requirements of Executive Order 13771. An initial regulatory analysis follows. 1. Background and Purpose of the Proposed Rule SEVP is a fee funded program within ICE that provides oversight of schools and nonimmigrant students in the F and M visa category. SEVP uses SEVIS to E:\FR\FM\17JYP4.SGM 17JYP4 Federal Register / Vol. 83, No. 137 / Tuesday, July 17, 2018 / Proposed Rules implementation of this proposed rule would provide SEVP with additional fee revenue of $75.2 million in FY 2019 and $73.5 million in FY 2020. If DHS does not adjust the current fees to recover the costs of processing the enrollment of F and M students, certification and recertification of schools, processing relating to J exchange visitors, appeals, and site visits, it will be forced to make reductions in oversight, security, and service as compared to current projections. To determine the full cost associated with SEVP and the management of SEVIS, SEVP used ABC methodology. ABC first identifies activities in an organization and then assigns the cost of each activity according to the resources they consume. SEVP identified the following as its primary activities: Collecting and retaining information on F, M, and J nonimmigrants; certifying schools; overseeing school compliance; recertifying schools; adjudicating appeals; investigating suspected violations of immigration law and other potential threats to national security by F, M, or J nonimmigrants; providing outreach and education to users; and monitor and track certified schools and F, M, and J nonimmigrant students. DoS also uses SEVIS in the management of the Exchange Visitor Program for nonimmigrant exchange visitors in the J visa category. SEVIS is a web-based system administered by SEVP that retains data on international students and exchange visitors in the country. SEVP uses SEVIS to ensure accurate reporting and recordkeeping by schools and exchange visitor programs. SEVP also uses SEVIS to identify for enforcement action student and exchange visitors who are out of status. The purpose of this proposed rule is to generate the necessary revenue to recover the full cost of the FY 2019 and FY 2020 budgets. SEVP is authorized to recover the full cost of all resources and services provided. The costs of SEVP activities have increased, and the fees collected no longer cover the costs. The fee increase is needed to meet long-term cash flow needs and achieve solvency. SEVP projects an annual budget of $186.6 million in FY 2019 and $188.4 million in FY 2020. SEVP forecasts $121.6 million in revenue for FY 2019 and FY 2020 without a fee change. The 33779 performing regulatory and policy analysis. SEVP also recognizes management and overhead costs associated with the program. SEVP proposes five fees paid by two source categories: Individuals will pay the I–901 SEVIS fee, and institutions will pay the I–17 certification fee, I–17 recertification fee, the fee for a motion or appeal, and the site visit fee. By tracing expenditures of the activities previously listed to the various fee categories, SEVP forecasted fee payments to determine the appropriate fee amount for each fee type proposed in this rule. Table 18 presents an accounting statement summarizing the annualized transfer amounts and qualitative benefits of the proposed rule. This rule proposes that schools will pay a higher fee for initial SEVP certification and will incur a fee for recertification, a site visit when adding a new physical location or campus, and the filing of a motion or appeal. In addition, F and M students and J visitors will pay higher fees. TABLE 18—ACCOUNTING STATEMENT FOR FY 2019 Category Primary estimate Qualitative Benefits .............. SEVP will be able to maintain the current level of service. This proposed rule will enhance SEVP’s capability to support national security and counter immigration fraud through the continued development and implementation of critical system and programmatic enhancements. Enhancements to SEVIS, including the establishment of a student portal, will assist DSOs in their regulatory obligation to provide accurate and timely information and rebalance this reporting requirement by providing students an automated means to do so. Increased adjudication personnel will assist in reducing recertification processing times, while enhanced vetting protocols will ensure that only those eligible to enter and remain in the country do so 7% Discount Rate $75,231,420 from schools and students to the government 3% Discount Rate $75,231,420 from schools and students to the government Transfers .............................. Category Effects Source Effects on State, local, and/or tribal government. The proposed rule would increase and establish additional fees on state, local, and/or tribal government-funded educational institutions for support of SEVP operations. This rule proposes to increase the I–17 certification fee and creates the I–17 recertification fee and a fee for filing an appeal or motion. In addition, this rule announces that following completion of this rulemaking, SEVP will collect a site visit fee when an SEVP-certified school adds a campus/location. The proposed rule would increase and establish additional fees for educational institutions in support of SEVP operations. This proposed rule would increase the I–17 certification fee and create the I–17 recertification fee and a fee for filing an appeal or motion. In addition, this rule announces that following the completion of this rulemaking, SEVP will collect a site visit fee when a school certified by SEVP adds a campus/ location. NPRM, Executive Order 12866 analysis daltland on DSKBBV9HB2PROD with PROPOSALS4 Effects on small businesses ........................ 2. Impacts of Regulatory Change This proposed rule would amend the current fees for the individual student and exchange visitor application fee (I– 901 SEVIS fee) and school certification petition for initial certification. It would maintain the current fee for site visits and extend it to any change of location VerDate Sep<11>2014 22:15 Jul 16, 2018 Jkt 244001 or additional physical location or campus reported as an update by a certified school. It would also institute a new fee for school recertification petitions and the filing of appeals and motions by schools. The amended fee structure reflects existing and projected PO 00000 Frm 00019 Fmt 4701 Sfmt 4702 Initial Regulatory Flexibility Analysis operating costs, program requirements, and planned program improvements. The current I–901 SEVIS fees are based on a fee analysis performed when SEVP last increased the fees in 2008. See 73 FR 55683. Those cost calculations were established on the basis of projected workload. Since 2008, E:\FR\FM\17JYP4.SGM 17JYP4 33780 Federal Register / Vol. 83, No. 137 / Tuesday, July 17, 2018 / Proposed Rules SEVP’s program mission tasks have expanded significantly. The expansions of certification, recertification, and appeals costs and the subsidization of excess costs not recovered by fees have led to the need for the proposed fee increase. Additionally, SEVP now provides investigative analysis to support enforcement operations, has increased numbers of adjudication personnel, and is undergoing SEVIS Modernization. Concurrently, costs associated with these program tasks have been affected by increased costs due to inflation. This rule proposes fees that would result in recovery of the full cost of SEVP operations with feegenerated revenue; alignment of the fees with current and projected costs and processes that have been adjusted as the program has gained experience and sophistication; and the agency’s adoption of more detailed and accurate data sources and improved management tools to align resources and workload. a. I–901 F and M SEVIS Fee F nonimmigrants, as defined in INA section 101(a)(15)(F), 8 U.S.C. 1101(a)(15)(F), are foreign students who come to the United States to pursue a full course of academic study in SEVPapproved schools and their dependents. M nonimmigrants, as defined in INA section 101(a)(15)(M), 8 U.S.C.1101(a)(15)(M), are foreign nationals pursuing a full course of study at an SEVP-certified vocational or other recognized nonacademic program (other than language training programs) in the United States and their dependents. International F and M nonimmigrant students seeking temporary admission into the United States to attend a U.S. educational institution must pay the I– 901 F and M SEVIS fee. SEVP proposes to increase the I–901 F and M SEVIS fee from $200 to $350. From 2007 through 2017, SEVP received an average of 450,581 I–901 F and M SEVIS payments per year. Table 19 shows the volume of I–901 F and M SEVIS fee payments received and the annual average number of fee payments from 2007 to 2017. As previously discussed, SEVP has forecasted 418,393 I–901 F and M payments in FY 2019 and 407,933 FY 2020, respectively. TABLE 19—1–901 F AND M SEVIS FEE PAYMENTS FYS 2010–2017 Fiscal year Fee payments 2007 ...................................... 2008 ...................................... 2009 ...................................... 2010 ...................................... 2011 ...................................... 2012 ...................................... 2013 ...................................... 2014 ...................................... 2015 ...................................... 2016 ...................................... 2017 ...................................... Annual Average (2007–2017) Forecasted 2019 ................... Forecasted 2020 ................... 358,666 400,090 348,815 389,255 431,180 449,029 469,986 519,751 574,158 545,203 470,261 450,581 418,393 407,933 Table 20 illustrates the incremental increase DHS is proposing with this rule for the I–901 F and M fee. Individuals who submit a Form I–901 will pay an additional $150 under this proposed rule, which is a 75 percent increase. TABLE 20—I–901 F AND M INCREMENTAL FEE INCREASE Type Current fee I–901 F and M ............................................................................................................................. SEVP estimates that the fee increase would result in an annual increase of transfer payment from students who submit an I–901 form to the government of approximately $62 million per year ($150 increase × 418,393 FY 2019 number of applicants = $62,758,950; $150 increase × 407,933 FY2020 number of applicants = $61,189,950). b. I–901 J-Full SEVIS Fee DoS generally oversees the exchange visitor program, which includes nonimmigrants who are charged the full J SEVIS fee. J exchange visitors are nonimmigrant individuals approved to participate in an exchange visitor program in the United States and the spouse and dependents of the exchange visitors. This SEVIS fee is associated with J–1 nonimmigrants participating in a designated exchange visitor program. $200 Proposed fee $350 Difference (proposed¥ current) $150 Certain other J–1 categories are subject to a reduced fee or are exempt from a fee in accordance with 8 U.S.C. 1372(e). SEVP and DoS have a memorandum of reimbursable agreement. DoS sends SEVP its actual expenditures, and SEVP reimburses them quarterly. Each year, SEVP and DoS review and update the memorandum. Table 21 displays the affected Exchange Visitor Program categories subject to the full SEVIS fee and the purpose of the visit.12 TABLE 21—J–1 EXCHANGE VISITOR PROGRAM CATEGORIES SUBJECT TO FULL SEVIS FEE Purpose of visit Short-term Scholar .......................... Professor and Research Scholar .... daltland on DSKBBV9HB2PROD with PROPOSALS4 Exchange visitor program category Lecture, observe, consult, training, demonstrate special skills. Research Scholar: Research, observe, or consult in connection with a research project. Professor: Teach or lecture at university, observe, or consult. Pursue graduate medical education or training at accredited schools of medicine or scientific institutions. Structured internship program that is in the student’s field of study. Structured training program that is in the trainee’s professional field. Observing, consulting, or demonstrating special skills. Teach full-time in an accredited primary, including pre- kindergarten, or secondary (K–12) public or private school. Physician ......................................... Intern ............................................... Trainee ............................................ Specialist ......................................... Teacher ........................................... 12 See Department of State, Exchange Visitor Program Category Requirements (June 2016), VerDate Sep<11>2014 22:15 Jul 16, 2018 Jkt 244001 available at https://j1visa.state.gov/wp-content/ uploads/2017/06/Exchange-Visitor-Program- PO 00000 Frm 00020 Fmt 4701 Sfmt 4702 Category-Requirements.pdf (last visited Feb. 26, 2018). E:\FR\FM\17JYP4.SGM 17JYP4 33781 Federal Register / Vol. 83, No. 137 / Tuesday, July 17, 2018 / Proposed Rules TABLE 21—J–1 EXCHANGE VISITOR PROGRAM CATEGORIES SUBJECT TO FULL SEVIS FEE—Continued Exchange visitor program category Purpose of visit Secondary School Student ............. Study in the U.S. at accredited public or private secondary schools for an academic semester or an academic year, while living with American host families. Participate in a degree or nondegree program at an accredited postsecondary academic institution, or participate in a student internship program. Engage in observation tours, discussions, consultations, professional meetings, conferences, workshops and travel when selected by a state or local government agency. College and University Student ...... Government visitor (non-Federal) ... SEVP receives an average of 151,958 I–901 Full J SEVIS payments per year (FYs 2007–2017). Table 22 displays the volume of Full I–901 J SEVIS fee payments received and the annual average number of fee payments. SEVP has forecasted 157,550 I–901 J-Full payments in FY 2019 and 153,611 in FY 2020. TABLE 22—I–901 J-FULL SEVIS FEE PAYMENTS FYS 2010–2017 Fiscal year 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 TABLE 22—I–901 J-FULL SEVIS FEE PAYMENTS FYS 2010–2017—Continued Fee payments ...................................... ...................................... ...................................... ...................................... ...................................... ...................................... ...................................... ...................................... ...................................... ...................................... ...................................... 132,213 137,173 129,979 139,534 148,253 155,008 160,522 172,530 168,967 164,401 162,959 Fiscal year Average (2007–2017) ........... Forecasted 2019 ................... Forecasted 2020 ................... Fee payments 151,958 157,550 153,611 The difference between the proposed and current fees for the I–901 J-Full applicants is $40, an increase of approximately 22 percent, as shown in Table 23. TABLE 23—I–901 J-FULL INCREMENTAL FEE Type Current fee Proposed fee Difference (proposed¥ current) I–901 J-Full .................................................................................................................................. $180 $220 $40 daltland on DSKBBV9HB2PROD with PROPOSALS4 The total increase in transfer payments from I–901 J-Full applicants to the government is expected to be $12,446,440 ($40 increase in fee × 157,550 FY 2019 and 153,611 FY 2020 forecasted number of applicants). The increase in J fees is meant to recover the full cost of J program operations for SEVP, which includes the reimbursement to DoS, SEVIS costs, and other adjudication services for J exchange visitors. For the purposes of calculating fees, SEVP isolates the costs specifically incurred by operating the J visa program. As it stands, the J visa program operates at a greater cost than the revenue that J visa fees bring to the program; therefore, SEVP proposes an increase to the J-Full visa to cover the $39.4 million full cost of operating the J visa program on an annual basis. c. I–17 Certification and Recertification Fee For a U.S. school to enroll F and M nonimmigrant students, it is required to be certified by SEVP. A school petitions for SEVP certification to enroll these students by completing and submitting Form I–17, ‘‘Petition for Approval of School for Attendance by Nonimmigrant Student,’’ online through SEVIS. VerDate Sep<11>2014 22:15 Jul 16, 2018 Jkt 244001 All SEVP-certified schools are required to go through the recertification process every 2 years to ensure they remain qualified for certification and adhere to all requirements according to the regulations. From FY 2012 to 2016, there has been an annual average of 423 schools applying for SEVP certification. As previously discussed, DHS calculated the 3-year moving average to minimize the variation in forecasting the population data. The I–17 Initial certifications from FYs 2012 through 2016 are shown in Table 24. TABLE 24—FYS 2012–2016 I–17 INITIAL CERTIFICATIONS Fiscal year 2012 2013 2014 2015 2016 PO 00000 I–17 certification petitions 3-Year moving average .......... .......... .......... .......... .......... 457 382 446 469 363 ........................ ........................ 428 432 426 Total ... 2,117 SEVP uses the 3-year moving average to predict that there will be 426 initial certifications in both FY 2019 and FY 2020, respectively. There are currently 8,746 SEVPcertified schools. DHS assumes that approximately half, or approximately 4,373 schools, will recertify each year, including the 1,728 schools with no active F or M students. DHS assumes that a school would prefer to recertify for a $1,250 fee instead of allowing certification to lapse and thereafter having to again pay the proposed initial certification fee of $3,000. The proposed initial certification fee is a 76 percent increase from the current fee. The current fee to apply for initial certification is $1,700, which has not changed since 2008. SEVP does not currently charge a recertification fee; the proposed fee amount is $1,250. The I– 17 initial certification and I–17 recertification incremental fees are shown in Table 25. ........................ Frm 00021 Fmt 4701 Sfmt 4702 E:\FR\FM\17JYP4.SGM 17JYP4 33782 Federal Register / Vol. 83, No. 137 / Tuesday, July 17, 2018 / Proposed Rules TABLE 25—I–17 INCREMENTAL FEES Type Proposed fee I–17 Initial Certification Fee ......................................................................................................... I–17 Recertification Fee ............................................................................................................... The annual increase in transfer payments from schools to the government from I–17 initial certifications is expected to be $553,800 ($1,300 increase in fee × 426 (FY 19 and FY 20 forecasted number of I–17 initial certifications)). The annual increase in transfer payments from schools to the government for I–17 recertification is expected to be $5,466,250 ($1,250 increase in fee × 4,373 (FY 2019 and FY 2020 forecasted number of recertifications)). d. Fee for Motion or Appeal When a school is denied certification or recertification, the school receives a denial letter through certified mail. The denial letter explains the reason for the denial and the steps to appeal. The school can appeal by completing the Form I–290B, ‘‘Notice of Appeal or Motion,’’ within 30 days of receipt. This rule proposes that SEVP impose a filing fee of $675, which is also the fee currently charged by USCIS upon submission of the Form I–290B.13 SEVP does not currently collect a fee from a school that files a motion or appeal. DHS proposes to revise its regulations to institute this fee for a school filing a motion or an appeal in order to establish a more equitable distribution of costs, improve services by decreasing an appeals or motions throughput time and a more sustainable level of cost recovery relative to the services provided. SEVP processed an average of 54 motions and appeals from schools annually from 2013 to 2016. DHS assumes that there will be the same number of appeals or motions filed in FY 2019 and FY 2020. The total annual increase in transfer payments from schools to the government for filing a motion or appeal is expected to be $36,450 ($675 fee × 54 (FY 2019 and FY 2020 forecasted number of fee payments)). e. Site Visit Fee As noted above, current regulations provide authority for SEVP to charge a site visit fee to schools that apply for initial certification or report a change of physical location, or addition of a physical location or campus. The site visit allows SEVP an opportunity to gather evidence on the school’s eligibility, review school facilities, and interview personnel listed on the I–17 petition as a PDSO or DSO. SEVP currently collects the $655 fee when a school files a petition for certification to issue Forms I–20 or by a certified school when it physically moves to a new location. This proposed rule notifies the public that following completion of this Current fee $3,000 1,250 $1,700 0 Difference (proposed¥ current) $1,300 1,250 rulemaking, SEVP plans to also collect the fee from any certified school that adds a physical location or campus, by updating its Form I–17 in SEVIS, consistent with the above authorities and the agency’s longstanding interpretation. SEVP performs 600 site visits annually. Of these 600 visits, 426 will be at schools that apply for initial certification and currently pay the $655 site visit fee. The remaining 174 site visits may include visits when a school adds a new physical location or campus. DHS proposes that the site visit fee amount, $655, remain the same. The annual increase in transfer payments from schools to the government due to site visits is expected to be $113,970 ($655 fee × 174 (FY 2019 and FY 2020 forecasted number of site visits)). f. Conclusion SEVP expects to have a total increase in fees of $68.7 million per year, discounted at 7 percent, transferred from individuals and entities for the services they receive, to the government. Table 26 shows the summary of the total annual number of payments, incremental fee amounts, and total fees transferred. TABLE 26—ANNUAL PROPOSED INCREMENTAL FEE AMOUNTS, FY 2019 Annual number of payments Proposed incremental fee amounts Annual fee transfer to government 418,393 157,550 426 4,373 426 174 54 $150 40 1,300 1,250 0 655 675 $62,758,950 6,302,000 553,800 5,466,250 0 113,970 36,450 Total ...................................................................................................................................... daltland on DSKBBV9HB2PROD with PROPOSALS4 I–901 F and M ............................................................................................................................. I–901 J-Full .................................................................................................................................. I–17 Initial Certification ................................................................................................................ I–17 Recertification ...................................................................................................................... Site Visits—initial ......................................................................................................................... Site Visits—new location ............................................................................................................. Appeals ........................................................................................................................................ ........................ ........................ 75,231,420 3. Alternatives SEVP examined several alternatives to the proposed fee structure, including no increase to any fee, only increasing the I–901 SEVIS fee and I–17 fee, and the unsubsidized results of the ABC model. Without an increase in fees, SEVP will be unable to maintain the level of service for students and schools that it currently provides as well as the compliance and national security activities discussed above. SEVP considered the alternative of maintaining fees at the current level but with reduced services and increased 13 USCIS I–290B, ‘‘Notice of Appeal or Motion,’’ Filing Fee of $675, https://www.uscis.gov/i-290b. VerDate Sep<11>2014 22:15 Jul 16, 2018 Jkt 244001 PO 00000 Frm 00022 Fmt 4701 Sfmt 4702 E:\FR\FM\17JYP4.SGM 17JYP4 Federal Register / Vol. 83, No. 137 / Tuesday, July 17, 2018 / Proposed Rules processing times, but has decided that this would not be in the best interest of applicants and schools. SEVP seeks to minimize the impact on all parties, but in particular small entities. If SEVP followed this alternative scenario, there would be a shortfall of revenue of over $65.4 million in FY 2019 to cover expenses. SEVP rejected this alternative. SEVP must pay for the expenses of maintaining and improving SEVIS and adjudicating schools applying to be certified by SEVP in a timely manner. SEVP also considered raising only the I–901 and I–17 certification fees instead of including a new proposed fee for recertification and for filing a motion or appeal. If SEVP followed this scenario, the I–901 F and M fee would increase to $350 to cover the shortfall in revenue, but the I–17 Initial Certification fee would also increase to $4,200. This would triple the existing certification fee while allowing schools with zero foreign students to remain active SEVP schools that require SEVP effort for recertification. SEVP rejected this fee structure as it would continue to add workload to SEVP’s recertification branch. Without any disincentive to recertify, the list of schools recertifying would likely continue to grow. The proposed fees, however, would establish a more equitable distribution of costs and a more sustainable level of cost recovery relative to the services provided. SEVP also considered the unsubsidized results of the ABC model as an alternative, which allocated the I– 901 F and M fee, school certification fees, and the fee to file an appeal or motion as shown in Table 27. TABLE 27—UNSUBSIDIZED FEE AMOUNTS Fee type daltland on DSKBBV9HB2PROD with PROPOSALS4 I–901 F and M ...................... I–901 J-Full ........................... I–901 J-Partial ...................... I–17 Initial Certification ......... I–17 Recertification ............... Appeal or Motion .................. Site Visit ................................ Unsubsidized fee amounts $290 130 130 4,600 6,000 38,475 650 SEVP rejected this alternative for several reasons. Most conspicuously, the fee to file a motion or appeal filed on the USCIS-managed Form I–290B has been set at $675. Since a fee of $38,475 would be significantly higher than any other SEVP fee it may improperly discourage schools from filing a motion or appeal. Similarly, SEVP rejected the alternative to set the recertification fee at the ABC model output amount of $6,000. A recertification fee higher than VerDate Sep<11>2014 22:15 Jul 16, 2018 Jkt 244001 the initial certification fee would discourage schools from seeking recertification. SEVP instead proposes to set the recertification fee at a level is less than the initial certification fee. When schools can maintain their certification, F and M nonimmigrant students enrolled in the withdrawn school avoid complications such as being forced to transfer schools, leave the United States, or risk facing immigration law penalties for violating the terms of their nonimmigrant status. SEVP also rejected the initial certification fee of $4,600 because it finds that an increase of almost three times the current fee of $1,700 is excessive. In the fee development, DHS balanced the challenge of minimizing the costs to schools and students while recovering funding to support SEVP services. The population of I–901 F and M students relative to the population of I–17 schools allows for a minimal fee adjustment to be spread over the student population to reduce the cost burden on individual institutions seeking recertification. B. Regulatory Flexibility Act Initial Regulatory Flexibility Analysis The Regulatory Flexibility Act (RFA) at 5 U.S.C. 603 requires DHS to consider the economic impact its proposed rules will have on small entities. In accordance with the RFA, DHS has prepared an Initial Regulatory Flexibility Analysis (IRFA) that examines the impacts of the proposed rule on small entities. The term ‘‘small entities’’ encompasses small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of fewer than 50,000. DHS requests information and data from the public that would assist in better understanding the impact of this proposed rule on small entities. DHS also seeks alternatives that will accomplish the same objectives and minimize the proposed rule’s economic impact on small entities. 1. A Description of the Reasons Why the Action by the Agency Is Being Considered DHS proposes this rule to adjust current fees and introduce new fees to ensure that SEVP is able to recover the full costs of the management and support of its program activities. DHS’s objectives and legal authority for this proposed rule are further discussed throughout this notice of proposed rulemaking (NPRM). PO 00000 Frm 00023 Fmt 4701 Sfmt 4702 33783 2. A Succinct Statement of the Objectives of, and Legal Basis for, the Proposed Rule The objective of the proposed rule is to prevent an anticipated funding deficit in operating the SEVP. More specifically, this proposed rule would increase the SEVP funding stream by adjusting the I–901 F and M fee, I–901 J-Full fee, and I–17 Certification fee and instituting the I–17 Recertification fee and a fee for filing a motion or appeal. This proposed rule would also announce the collection of a site visit fee when an SEVP-certified school adds a new physical location or campus, at which it provides educational services to nonimmigrant students. The funding supports continuing operations and new initiatives critical to SEVP oversight of schools and the monitoring of nonimmigrant students in the F, M, and J visa classifications for national security purposes. The legal basis for this proposed rule increasing the SEVP funding stream is grounded in the Homeland Security Act of 2002, which created DHS and imparted upon DHS the responsibility for SEVIS. DHS uses SEVIS to meet the monitoring and verification requirements under EBSVERA, Public Law 107–173, secs. 501–502, 116 Stat. 543, 560–63 (2002) (codified at 8 U.S.C. 1761–1762), and to conduct a recertification of schools every 2 years following the date of EBSVERA’s enactment. The Secretary of Homeland Security is authorized to collect fees for SEVP from prospective F and M students and J exchange visitors. IIRIRA section 641(e)(1), as amended, 8 U.S.C. 1372(e)(1). Initially, fees for most groups of F, M, and J classes of prospective nonimmigrants were statutorily limited to not exceed $100, except in the case of the fee for special J visa categories— au pairs, camp counselors, and participants in summer work travel programs—which was set at $35 pursuant to 8 U.S.C. 1372(e)(4)(A). This fee level has been maintained consistent with Congressional intent. The Secretary is authorized to revise nonimmigrant fees on a periodic basis to account for changes in the cost of executing SEVP. IIRIRA section 641(g)(2), 8 U.S.C. 1372(g)(2). In addition, INA section 286(m), 8 U.S.C. 1356(m), provides that DHS may set fees ‘‘at a level that will ensure recovery of the full costs of providing [adjudication] services.’’ E:\FR\FM\17JYP4.SGM 17JYP4 33784 Federal Register / Vol. 83, No. 137 / Tuesday, July 17, 2018 / Proposed Rules 3. A Description—and, Where Feasible, an Estimate of the Number—of Small Entities to Which the Proposed Rule Will Apply This analysis does not apply to increases in the I–901 F and M fees because these fees are paid by individuals who are not, for purposes of the RFA, within the definition of small entities established by 5 U.S.C. 601(6). DHS believes that J fees are also paid by individuals and requests comment on this assumption. As of May 2017, there were a total of 8,746 SEVP-certified schools that would be subject to the I–17 recertification fee, site visit fee, and fee to file a motion or an appeal. New schools applying for SEVP certification would be subject to the proposed I–17 initial certification fee. Of the 8,746 SEVP-certified schools, 2,013 have identified as public schools on their I–17 form. The remaining 6,733 schools have identified themselves on the Form I–17 as private for-profit, private nonprofit, or private unspecified entities.14 Of the 2,013 SEVP-certified public schools, DHS conducted a random sample of 100 15 schools to approximate the number of public schools in a governmental jurisdiction with a population of less than 50,000. Out of the 100 public schools, 62, or 62 percent, are located in a city with a population fewer than 50,000. DHS infers 1,248 SEVP-certified public schools are considered a small entity as defined by SBA. DHS conservatively assumes that all 1,507 private nonprofit schools certified by SEVP are small entities because they are not dominant in their fields. DHS also assumes that the 4,755 schools that are private unspecified are small entities. DHS requests comments on these assumptions. To determine which of the remaining 471 private for-profit schools are considered a small entity, DHS references the Small Business Administration (SBA) size standards represented by business average annual receipts. Receipts are generally defined as a firm’s total income or gross income. SBA’s Table of Small Business Size Standards is matched to the North American Industry Classification System (NAICS) for industries.16 DHS matches information provided by the schools in SEVIS regarding what programs of study it is engaged in with an appropriate NAICS industry description. NAICS is the standard classification used to categorize business establishments for the purpose of collecting, analyzing, and publishing statistical data related to the U.S. economy. DHS finds that the revenue of 332 of the 471 private, for-profit schools meet the SBA size standard of a small business according to their industry. DHS estimates each private school’s annual receipts by multiplying the approximate annual cost of room, board, and tuition by the average annual number of total students, based on data provided by the schools on their Forms I–17. Every 2 years, as part of the recertification process, a school submits the approximate annual cost of room, board, and tuition per student and the average annual number of total students, both domestic and international. DHS acknowledges that this method to estimate receipts may be an incomplete account of a school’s income, which may also include contributions from private individuals or other endowments. Since these data reflect a snapshot of all SEVP-certified schools as of May 24, 2017, DHS acknowledges there may be day-to-day changes in the status of a school’s certification and that a school’s revenue may differ from actual revenue due to a 2-year lag in school self-reporting before a school is required to recertify. Given these assumptions, DHS estimates that 7,842 schools meet the SBA definition of a small entity. This is approximately 90 percent of the 8,746 of SEVP-certified schools included in this analysis. Table 28 shows a summary by school type of the number of SEVP-certified schools and estimated small entities. TABLE 28—SEVP-CERTIFIED SCHOOLS BY SCHOOL TYPE Description Total Small entities Public Schools ......................................................................................................................................................... Private, nonprofit schools ........................................................................................................................................ Private, unspecified schools .................................................................................................................................... Private, for-profit schools ......................................................................................................................................... 2,013 1,507 4,755 471 1,248 1,507 4,755 332 Total Number of SEVP-Certified Schools ........................................................................................................ 8,746 7,842 daltland on DSKBBV9HB2PROD with PROPOSALS4 Table 29 provides a summary of the SEVP-certified schools by industry. The table also shows the NAICS industry description, the NAICS code, and the number of small and large schools by industry. Note that the number of small schools includes all nonprofits and unspecified private schools. Most industries with SEVP-certified schools consist of a majority of small schools. 14 Prior to October 1, 2016, schools had two options in SEVIS to select their school type: Public or private unspecified. With the recent SEVIS update, schools can only choose one of three options: Public, private for-profit, or private nonprofit. 15 The random sample helps ensure an accurate representation of the population with each school having an equal chance of being included. In determining the sample size DHS utilized a 90 percent confidence level (z-score), 10 percent margin of error (e), and a 50 percent population proportion (p) used as an unknown input and to maximize the estimate to overestimate sample size. The sample size equation used n = z2p(1¥p)/e2 provided inputs 1.652(.5)(.5)/.01 = 69 and rounded up to 100 to over sample. DHS identified geographic population data matched to the school’s city address provided in SEVIS, sourced from U.S. Census Bureau 2010–2016 Cities and Towns (Incorporated Places and Minor Civil Divisions) at https://www.census.gov/data/tables/2016/demo/ popest/total-cities-and-towns.html. 16 U.S. Small Business Administration, Tables of Small Business Size Standards Matched to NAICS Codes (Oct. 1, 2017), available at https:// www.sba.gov/sites/default/files/files/Size_ Standards_Table_2017.xlsx. VerDate Sep<11>2014 22:15 Jul 16, 2018 Jkt 244001 PO 00000 Frm 00024 Fmt 4701 Sfmt 4702 E:\FR\FM\17JYP4.SGM 17JYP4 33785 Federal Register / Vol. 83, No. 137 / Tuesday, July 17, 2018 / Proposed Rules TABLE 29—NUMBER OF SEVP-CERTIFIED SCHOOLS BY INDUSTRY School industry Elementary and Secondary Schools. Junior Colleges ............... Colleges, Universities, and Professional Schools. Computer Training .......... Professional and Management Development Training. Cosmetology and Barber Schools. Flight Training ................. Apprenticeship Training .. Other Technical and Trade Schools. Fine Arts Schools ............ Sports and Recreation Instruction. Language Schools .......... Exam Preparation and Tutoring. All Other Misc. Schools and Instruction. Educational Support Services. Public Schools (Elementary, Secondary, and High School). daltland on DSKBBV9HB2PROD with PROPOSALS4 Total ......................... NAICS industry description Number of small schools Number of non-small schools Total SEVPcertified schools Percent small schools Industry primarily engaged in providing academic courses and related course work that contain a basic preparatory education. A basic preparatory education generally starts kindergarten through 12th grade. Industry primarily engaged in providing academic or technical courses and granting associate degrees, certificates, or diplomas below the baccalaureate level. Industry primarily engaged in providing academic courses and granting degrees at baccalaureate or graduate levels. The requirement for admission is at least a high school diploma or equivalent general academic training. Industry primarily engaged in providing computer training (except computer repair), such as computer programming, software packages, computerized business systems, computer electronics technology, computer operations, and local area network management. Industry primarily engaged in providing a collection of short interval courses and sessions for management and professional development. Training for career development may be provided directly to individuals or through employers’ training programs, and courses may be customized or modified to meet the special needs of customers. Industry primarily engaged in providing training in hair styling, barbering, or cosmetic arts, such as makeup or skin care. Industry primarily engaged in providing aviation and flight training. Industry primarily engaged in providing apprenticeship training programs. Industry primarily engaged in providing job or career vocational or technical courses (except cosmetology and barber training, aviation and flight training, and apprenticeship training). Establishments primarily engaged in offering instruction in the arts, including dance, art, drama, and music. Industry primarily contains institutions such as camps and schools, primarily engaged in providing instruction in athletic activities to groups of individuals. Industry primarily engaged in providing foreign language instruction (including sign language). Industry primarily engaged in providing training for standardized examinations and/or educational tutoring services. Industry primarily engaged in providing instruction (except academic schools, colleges and universities, business, computer, management, technical, trade, fine arts, athletic, language instruction, tutoring, and automobile driving instruction). Industry primarily engaged in providing non-instructional services that support educational processes or systems. Industry primarily engaged in providing academic courses and related course work that contain a basic public education. 611110 3,472 18 3,490 99 611210 11 2 13 85 611310 2,150 57 2,207 97 611420 13 0 13 100 611430 18 0 18 100 611511 91 3 94 97 611512 199 1 200 100 611513 39 1 40 98 611519 183 6 189 97 611610 79 3 82 96 611620 10 0 10 100 611630 286 44 330 87 611691 8 4 12 67 611699 32 0 32 100 611710 2 0 2 100 N/A 1,248 765 2,013 62 .................................................................................. ........................ 7,842 904 8,746 90 Table 30 presents the type of schools with active F and M students and the percent of students enrolled in small schools. Most F and M students are enrolled at small schools. Of the 8,746 SEVP-certified schools, DHS identified 1,728 with no active F or M students VerDate Sep<11>2014 NAICS codes 22:15 Jul 16, 2018 Jkt 244001 and determined that 1,296 of these are considered small entities as defined by SBA. Note that although there are two SEVP-certified schools in the education support services industry (shown in Table 29), there are no active F and M students in these schools. DHS applies PO 00000 Frm 00025 Fmt 4701 Sfmt 4702 the results of the sample of SEVPcertified public schools to the number of students in SEVP-certified public schools (619,295) to estimate that the number of students in small SEVPcertified public schools is 383,963. E:\FR\FM\17JYP4.SGM 17JYP4 33786 Federal Register / Vol. 83, No. 137 / Tuesday, July 17, 2018 / Proposed Rules TABLE 30—TOTAL NUMBER OF ACTIVE F AND M STUDENTS BY INDUSTRY School industry Total active F and M students in small schools Total active F and M students Elementary and Secondary Schools ........................................................................................... Junior Colleges ............................................................................................................................ Colleges, Universities, and Professional Schools ....................................................................... Computer Training ....................................................................................................................... Professional and Management Development Training ............................................................... Cosmetology and Barber Schools ............................................................................................... Flight Training .............................................................................................................................. Apprenticeship Training ............................................................................................................... Other Technical and Trade Schools ............................................................................................ Fine Arts Schools ........................................................................................................................ Sports and Recreation Instruction ............................................................................................... Language Schools ....................................................................................................................... Exam Preparation and Tutoring .................................................................................................. All Other Miscellaneous Schools and Instruction ........................................................................ Educational Support Services ..................................................................................................... Public Schools ............................................................................................................................. 60,990 409 419,593 404 217 91 6,598 71 1,108 1,736 13 33,500 1,469 218 ........................ 383,963 63,491 418 429,784 404 217 93 6,605 75 1,111 2,030 13 41,867 1,984 218 ........................ 619,295 DHS estimated SEVP-certified public schools’ revenue to examine the impact of the proposed fee adjustments on small public schools. The tuition provided by public schools in SEVIS may not represent a public school’s total revenue because most of the U.S. students would generally not pay the tuition provided to attend public schools. Instead, DHS assumes that a public school’s county or city’s tax revenue is the best revenue source against which to assess the impact of the proposed fee adjustments. DHS collected local government revenue, expenditure, debt, and assets from the U.S. Census Bureau 2015 State and Local Government Survey 17 to examine the impact of the increased fees on the public schools included in the sample. A county or city’s revenue may be an overestimation of a public school’s capability to pay the fees related to SEVP-certification, appeals, or site visits for new locations. This revenue approximation may minimize the impact of the fee adjustments for public schools. DHS requests comments on these assumptions. Table 31 displays the range of annual revenue by each school industry and for public schools, from the small school Percent of students at small schools 96 98 98 100 100 98 100 95 100 86 100 80 74 100 0 62 with the lowest revenue to the median revenue of all the small schools to the small school with the largest revenue. It also shows the average revenue of all the small schools in that industry. The Colleges, Universities, and Professional Schools industry has the widest range from maximum to minimum revenue due to the assumption that all private, unspecified schools are small entities, while the Educational Support Services industry that only has two schools included has the smallest range of maximum to minimum revenue for any one industry. TABLE 31—RANGE OF ANNUAL REVENUE BY SCHOOL INDUSTRY Lowest annual revenue School industry daltland on DSKBBV9HB2PROD with PROPOSALS4 Elementary and Secondary Schools ........................................................... Junior Colleges ............................................................................................ Colleges, Universities, and Professional Schools ....................................... Computer Training ....................................................................................... Professional and Management Development Training ............................... Cosmetology and Barber Schools ............................................................... Flight Training .............................................................................................. Apprenticeship Training ............................................................................... Other Technical and Trade Schools ............................................................ Fine Arts Schools ........................................................................................ Sports and Recreation Instruction ............................................................... Language Schools ....................................................................................... Exam Preparation and Tutoring .................................................................. All Other Miscellaneous Schools and Instruction ........................................ Educational Support Services ..................................................................... Public Schools ............................................................................................. Median annual revenue $28,800 44,400 26,400 425,000 129,600 70,000 36,000 132,000 64,000 66,000 276,800 118,500 3,150,000 83,250 340,000 4,389,000 $5,116,550 2,560,000 28,432,500 3,000,000 717,500 2,183,000 3,000,000 10,265,875 2,800,000 2,895,000 1,165,000 5,725,000 5,043,189 845,000 521,750 192,353,500 17 Available at https://www.census.gov/govs/ local/. VerDate Sep<11>2014 22:15 Jul 16, 2018 Jkt 244001 PO 00000 Frm 00026 Fmt 4701 Sfmt 4702 E:\FR\FM\17JYP4.SGM 17JYP4 Largest annual revenue $1,680,000,000 15,255,000 5,002,524,120 14,000,000 2,904,625 66,907,200 60,000,000 106,080,000 82,800,000 130,000,000 9,312,500 108,000,000 27,000,000 469,050,000 703,500 17,833,251,000 Average annual revenue $13,194,355 4,271,901 96,761,518 3,881,631 1,000,423 4,092,673 5,959,154 21,004,563 7,570,939 9,425,304 2,626,805 7,514,433 6,983,297 18,359,767 521,750 1,315,830,548 33787 Federal Register / Vol. 83, No. 137 / Tuesday, July 17, 2018 / Proposed Rules 4. A Description of the Projected Reporting, Recordkeeping, and Other Compliance Requirements of the Proposed Rule, Including an Estimate of the Classes of Small Entities That Will Be Subject to the Requirement and the Types of Professional Skills Necessary for Preparation of the Report or Record The proposed rule would increase and establish additional fees for educational institutions in support of SEVP operations. DHS estimates the annual impact to small schools based on the school cost of compliance as represented as a percentage of their annual revenue. Table 32 displays the proposed fees, the current fees, and the difference in these amounts. This analysis examines the impact that the proposed incremental fee for the Form I–17 certification and the proposed fees for recertification, site visits to add a new physical location or campus, and the filing of a motion or an appeal would have on small SEVP-certified schools. TABLE 32—PROPOSED SCHOOL FEES BY TYPE Fee type Proposed fee I–17 Certification Fee ...................................................................................... I–17 Recertification Fee ................................................................................... Site Visit Fee—initial ........................................................................................ Site Visit Fee—new location ............................................................................ Motion or Appeal Fee ...................................................................................... I–17 Certification Fee A school files a petition and pays a certification fee to become eligible to issue the Form I–20, ‘‘Certificate of Eligibility for Nonimmigrant Student Status,’’ to prospective international students after admitting them for a course of study. Certification also authorizes the school to enroll Current fee $3,000 1,250 655 655 675 international students after they enter the country on an F or M student visa. Schools must initially go through the vetting process for authorization by DHS to enroll F and/or M nonimmigrant students and pay the I–17 certification fee, which is currently $1,700 and proposed to increase to $3,000. The incremental fee is the difference $1,700 0 655 0 0 Difference (proposed¥ current) Percent increase $1,300 1,250 0 655 675 76 N/A 0 N/A N/A between the proposed fee ($3,000) and current fee ($1,700), or $1,300. From 2012 to 2016, DHS processed 2,117 I–17 petitions and payments. Out of the 2,117 schools, 1,151, or 54 percent, were identified as meeting the SBA definition of a small school, or estimated to be a small public school based on the sample conducted, as illustrated in Table 33. TABLE 33—I–17 INITIAL CERTIFICATIONS FYS 2012–2016 Total I–17 initial certifications Fiscal year 2012 2013 2014 2015 2016 Percent of small school I–17 initial certifications Small school I–17 initial certifications ............................................................................................................................................. ............................................................................................................................................. ............................................................................................................................................. ............................................................................................................................................. ............................................................................................................................................. 457 382 446 469 363 236 218 270 260 167 52 57 60 55 46 Total ...................................................................................................................................... 2,117 1,151 54 2014–2016 3-year annual average ............................................................................... 426 232 55 SEVP forecasted the total I–17 initial certifications in FY 2019 and FY 2020 to be 426 using the 3-year annual average of FY 2014 through 2016 initial certifications. Using that same methodology, 232 small schools applied for initial I–17 certification on average each year. DHS assumes the growth of small schools per industry seeking SEVP certification will remain constant in the future. DHS multiplied the annual average number of small schools applying for initial certification by the percent of small schools in each industry, as presented in Table 29. This calculation yields the number of small schools expected to petition for initial I– 17 certification by industry. The results are presented in Table 34. daltland on DSKBBV9HB2PROD with PROPOSALS4 TABLE 34—EXPECTED ANNUAL NUMBER OF SMALL SCHOOLS TO INITIALLY CERTIFY BY SCHOOL INDUSTRY Annual number of small schools applying for initial certification School industry Elementary and Secondary Schools ............................................................................................................................................... Junior Colleges ................................................................................................................................................................................ Colleges, Universities, and Professional Schools ........................................................................................................................... Computer Training ........................................................................................................................................................................... Professional and Management Development Training ................................................................................................................... VerDate Sep<11>2014 22:15 Jul 16, 2018 Jkt 244001 PO 00000 Frm 00027 Fmt 4701 Sfmt 4702 E:\FR\FM\17JYP4.SGM 17JYP4 103 0 64 0 1 33788 Federal Register / Vol. 83, No. 137 / Tuesday, July 17, 2018 / Proposed Rules TABLE 34—EXPECTED ANNUAL NUMBER OF SMALL SCHOOLS TO INITIALLY CERTIFY BY SCHOOL INDUSTRY—Continued Annual number of small schools applying for initial certification School industry Cosmetology and Barber Schools ................................................................................................................................................... Flight Training .................................................................................................................................................................................. Apprenticeship Training ................................................................................................................................................................... Other Technical and Trade Schools ................................................................................................................................................ Fine Arts Schools ............................................................................................................................................................................ Sports and Recreation Instruction ................................................................................................................................................... Language Schools ........................................................................................................................................................................... Exam Preparation and Tutoring ...................................................................................................................................................... All Other Miscellaneous Schools and Instruction ............................................................................................................................ Educational Support Services ......................................................................................................................................................... Public Schools ................................................................................................................................................................................. 3 6 1 5 2 0 8 0 1 0 37 Total Small Schools .................................................................................................................................................................. 232 This analysis examines the impact the $1,300 incremental fee has on small schools that might seek initial certification after the final rule is effective. DHS assumes that the range of revenue of the small schools that will apply for certification is similar to the range of revenue of current SEVPcertified small schools and uses this range to show the potential impacts. Table 35 shows the impact as a percentage for the schools with the lowest annual revenue, median annual revenue, and largest annual revenue, as well as the average annual revenue for all schools in that industry. From these results, DHS does not expect the I–17 certification incremental fee to have an impact greater than 1 percent on the average small school annual revenue. However, there is an expected impact greater than 1 percent for some small schools with the lowest annual revenue in their industry. On average the estimated 194 small schools that apply for initial I–17 certification annually and pay an incremental fee of $1,300 will experience an impact of less than 1 percent of their estimated annual revenue. TABLE 35—INITIAL CERTIFICATION FEE IMPACT FOR SMALL SCHOOLS BY TYPE OF SCHOOL I–17 initial certification incremental fee impact on the school with the lowest revenue (percent) Type of school I–17 initial certification incremental fee impact on the school with the median revenue (percent) 4.5 2.9 4.9 0.3 1.0 1.9 3.6 1.0 2.0 2.0 0.5 1.1 0.0 1.6 0.4 0.0 0.0 0.1 0.0 0.0 0.2 0.1 0.0 0.0 0.0 0.0 0.1 0.0 0.0 0.2 0.2 0.0 Elementary and Secondary Schools ............................................................... Junior Colleges ................................................................................................ Colleges, Universities, and Professional Schools ........................................... Computer Training ........................................................................................... Professional and Management Development Training ................................... Cosmetology and Barber Schools ................................................................... Flight Training .................................................................................................. Apprenticeship Training ................................................................................... Other Technical and Trade Schools ................................................................ Fine Arts Schools ............................................................................................ Sports and Recreation Instruction ................................................................... Language Schools ........................................................................................... Exam Preparation and Tutoring ...................................................................... All Other Miscellaneous Schools and Instruction ............................................ Educational Support Services ......................................................................... Public Schools ................................................................................................. daltland on DSKBBV9HB2PROD with PROPOSALS4 I–17 Recertification Fee SEVP-certified schools are required to file for recertification every 2 years to demonstrate that they have complied with all recordkeeping, retention, reporting, and other requirements when registering F and M students. There is currently no fee charged to schools for recertification, but this proposed rule establishes a new fee for that process. VerDate Sep<11>2014 22:15 Jul 16, 2018 Jkt 244001 To measure the impact on small schools, DHS first estimated the number of small schools that will recertify. DHS assumes 50 percent (4,373) of the total number of schools in this analysis (8,746) will recertify each year. DHS multiplies the recertification rate of 50 percent by the total number of small schools to generate the estimation that PO 00000 Frm 00028 Fmt 4701 Sfmt 4702 I–17 initial certification incremental fee impact on the school with the largest revenue (percent) I–17 initial certification incremental fee impact on the average school revenue (percent) 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.2 0.0 0.01 0.03 0.00 0.03 0.13 0.03 0.02 0.01 0.02 0.01 0.05 0.02 0.02 0.01 0.25 0.0 3,921 18 small schools will recertify annually. DHS examined all 7,842 small SEVP-certified schools to determine the impact of the recertification fee, as it is assumed that a significant number of the schools will pursue recertification within the next 2 years. 18 7,842 × 50 percent = 3,921 small schools recertifying each year. E:\FR\FM\17JYP4.SGM 17JYP4 33789 Federal Register / Vol. 83, No. 137 / Tuesday, July 17, 2018 / Proposed Rules DHS assumes that the total number of SEVP-certified schools will remain static as new schools become certified and other schools withdraw certification. DHS therefore assumes that the annual increase of total recertifications will be zero. As previously discussed, DHS identified 1,296 SBA-defined small schools with no active F or M international students. DHS included these schools in this analysis and assumes they will opt to pay the recertification fee of $1,250 rather than reapplying for initial certification with a proposed fee of $3,000 at such time in the future that they enroll F or M students. Table 36 illustrates the number of small schools that will recertify by industry and the I–17 recertification incremental fee impact as a percent of the small school’s annual revenue. From these findings, of the 7,842 small schools expected to apply for recertification and pay the proposed fee of $1,250, 50 schools, or 0.6 percent, will experience an impact greater than 1 percent but less than 3 percent of the school’s annual revenue. For the remaining schools, DHS does not expect the incremental fee to have an impact of greater than 1 percent. TABLE 36—RECERTIFICATION FEE IMPACT FOR SMALL SCHOOLS BY TYPE OF SCHOOL School industry 0%<Impact≤1% 1%<Impact≤2% 2%<Impact<3% Elementary and Secondary Schools ........................................................... Junior Colleges ............................................................................................ Colleges, Universities, and Professional Schools ....................................... Computer Training ....................................................................................... Professional and Management Development Training ............................... Cosmetology and Barber Schools ............................................................... Flight Training .............................................................................................. Apprenticeship Training ............................................................................... Other Technical and Trade Schools ............................................................ Fine Arts Schools ......................................................................................... Sports and Recreation Instruction ............................................................... Language Schools ....................................................................................... Exam Preparation and Tutoring ................................................................... All Other Miscellaneous Schools and Instruction ........................................ Educational Support Services ...................................................................... Public Schools ............................................................................................. 3,458 10 2,135 13 18 89 196 39 175 76 10 285 8 30 2 1,248 7 0 12 0 0 2 1 0 8 3 0 1 0 2 0 0 7 1 4 0 0 0 2 0 0 0 0 0 0 0 0 0 3,472 11 2,150 13 18 91 199 39 183 79 10 286 8 32 2 1,248 Total Small Schools .............................................................................. 7,792 36 14 7,842 Site Visit Fee Current regulations provide authority for SEVP to charge a site visit fee to schools that apply for initial certification or add a new physical location or campus. The site visit allows SEVP an opportunity to gather evidence on the school’s eligibility, review school facilities, and interview personnel listed on the I–17 petition as a PDSO or DSO. SEVP currently collects the $655 fee when a school files a petition for certification to issue Forms I–20 or by a certified school when it physically moves to a new location. This proposed rule notifies the public that SEVP plans to collect the fee from any certified school that adds a new campus or physical location by updating its Form I–17 in SEVIS, consistent with 8 CFR 214.3(h)(3) and the agency’s description when it established the fee in 2008 that such a fee could apply to such an initial event. 73 FR 55683, 55691. SEVP performs 600 site visits annually. Of these site visits, 426 would be performed as part of the forecasted initial certifications, leaving the capacity for 174 site visits to be performed when a school adds a campus. In order to estimate the impact on a school’s revenue of the proposed charging of the site visit fee for a new instructional campus, DHS assumes that any of the currently SEVP-certified Total schools could add a campus and require a site visit. Table 37 shows the proposed site visit fee impact on estimated annual revenue for all 7,842 small schools certified by SEVP and the type of school. Of the total 7,842 small schools, 7,827, or 99.8 percent, would have a site visit fee impact of less than or equal to 1 percent of their annual revenue. Twelve small schools, or 0.2 percent of small schools, would have an impact of greater than 1 percent but less than or equal to 2 percent of their annual revenue. Three small schools would have a site visit fee impact greater than 2 percent but less than 3 percent of their annual revenue. TABLE 37—SITE VISIT FEE IMPACT ON ESTIMATED ANNUAL REVENUE daltland on DSKBBV9HB2PROD with PROPOSALS4 Type of school 0%<Impact≤1% 1%<Impact≤2% 2%<Impact<3% 3,465 10 2,146 13 18 91 197 39 182 79 10 286 8 5 1 3 0 0 0 2 0 1 0 0 0 0 2 0 1 0 0 0 0 0 0 0 0 0 0 Elementary and Secondary Schools ........................................................... Junior Colleges ............................................................................................ Colleges, Universities, and Professional Schools ....................................... Computer Training ....................................................................................... Professional and Management Development Training ............................... Cosmetology and Barber Schools ............................................................... Flight Training .............................................................................................. Apprenticeship Training ............................................................................... Other Technical and Trade Schools ............................................................ Fine Arts Schools ......................................................................................... Sports and Recreation Instruction ............................................................... Language Schools ....................................................................................... Exam Preparation and Tutoring ................................................................... VerDate Sep<11>2014 22:15 Jul 16, 2018 Jkt 244001 PO 00000 Frm 00029 Fmt 4701 Sfmt 4702 E:\FR\FM\17JYP4.SGM 17JYP4 Total 3,472 11 2,150 13 18 91 199 39 183 79 10 286 8 33790 Federal Register / Vol. 83, No. 137 / Tuesday, July 17, 2018 / Proposed Rules TABLE 37—SITE VISIT FEE IMPACT ON ESTIMATED ANNUAL REVENUE—Continued Type of school 0%<Impact≤1% 1%<Impact≤2% 2%<Impact<3% All Other Miscellaneous Schools and Instruction ........................................ Educational Support Services ...................................................................... Public Schools ............................................................................................. 32 2 1,248 0 0 0 0 0 0 32 2 1,248 Total Small Schools .............................................................................. 7,827 12 3 7,842 Fee To File an Appeal or Motion When a school is denied certification or recertification, the school receives a denial letter through certified mail. The denial letter explains the reason for the denial and the steps to appeal. The school can appeal by completing the Form I–290B, ‘‘Notice of Appeal or Motion,’’ within 30 days of receipt. This rule proposes that SEVP impose a $675 filing fee for submission of the Form I– 290B.19 Currently no fee is imposed when a school submits the Form I–290B for a motion or appeal. DHS processed 215 motions and appeals from schools from 2013 to 2016. Out of the 215 school motions and appeals, DHS determined that 74, or 34.4 percent, were filed by small schools. Among the 74 small schools, 4 had 2 appeals within the same year or over the 4-year period. During the 4-year period, there was an average of 19 appeals and motions filed by small schools annually. DHS examined all 7,842 small schools to estimate the impact of the proposed appeal and motion fee on estimated annual revenue. The impact is calculated by dividing the fee to file a motion or appeal by the school’s estimated annual revenue. Of the 7,842 Total SEVP-certified small schools, 7,826, or 99.8 percent, would experience an impact less than or equal to 1 percent of their estimated annual revenue were the school to file an appeal or motion. DHS estimates 13 small schools, or 0.2 percent, would realize an impact between 1 percent and 2 percent of their estimated annual revenue. In addition, three small schools, or 0.04 percent, would experience an impact greater than 2 percent but less than 3 percent of estimated annual revenue. Table 38 shows the number of small schools within the range of impact to each school’s estimated annual revenue. TABLE 38—APPEAL AND MOTION FEE IMPACT ON ESTIMATED ANNUAL REVENUE 0%<Impact≤1% 1%<Impact≤2% 2%<Impact<3% Elementary and Secondary Schools ........................................................... Junior Colleges ............................................................................................ Colleges, Universities, and Professional Schools ....................................... Computer Training ....................................................................................... Professional and Management Development Training ............................... Cosmetology and Barber Schools ............................................................... Flight Training .............................................................................................. Apprenticeship Training ............................................................................... Other Technical and Trade Schools ............................................................ Fine Arts Schools ......................................................................................... Sports and Recreation Instruction ............................................................... Language Schools ....................................................................................... Exam Preparation and Tutoring ................................................................... All Other Miscellaneous Schools and Instruction ........................................ Educational Support Services ...................................................................... Public Schools ............................................................................................. 3,465 10 2,146 13 18 91 197 39 182 78 10 286 8 32 2 1,248 5 1 3 0 0 0 2 0 1 1 0 0 0 0 0 0 2 0 1 0 0 0 0 0 0 0 0 0 0 0 0 0 3,472 11 2,150 13 18 91 199 39 183 79 10 286 8 32 2 1,248 Total Small Schools .............................................................................. daltland on DSKBBV9HB2PROD with PROPOSALS4 Type of school 7,826 13 3 7,842 The potential total impact on small entities in any year can be determined by examining scenarios in which a school may pay more than one of the proposed adjustments in fees in the same year. DHS examines the following scenarios and determines that the impact on any small school’s revenue is less than three percent on any school industry type: (1) A school appeals an initial certification or (2) a school appeals a recertification and adds a new location requiring a site visit. A school may pay the initial certification fee and then it may appeal the results of the initial certification within the same year. DHS proposes that this would be an increase of $1,975 ($1,300 incremental fee for I–17 initial certification plus $675 fee for an Total appeal). More than 98 percent of schools would be impacted less than one percent in this scenario, as shown in Table 39. The impacts of this scenario would be greater than the impacts of scenario where a school appeals a recertification, which would add to $1,925 in increased fees ($1,250 I–17 recertification fee plus $675 for an appeal). TABLE 39—IMPACT OF INITIAL CERTIFICATION FEE INCREASE PLUS AN APPEAL FEE Type of school 0%<Impact≤1% 1%<Impact≤2% 2%<Impact<3% 3,440 21 11 Elementary and Secondary Schools ........................................................... 19 USCIS, I–290B, Notice of Appeal or Motion, Filing Fee, https://www.uscis.gov/i-290b. VerDate Sep<11>2014 22:15 Jul 16, 2018 Jkt 244001 PO 00000 Frm 00030 Fmt 4701 Sfmt 4702 E:\FR\FM\17JYP4.SGM 17JYP4 Total 3,472 33791 Federal Register / Vol. 83, No. 137 / Tuesday, July 17, 2018 / Proposed Rules TABLE 39—IMPACT OF INITIAL CERTIFICATION FEE INCREASE PLUS AN APPEAL FEE—Continued Type of school 0%<Impact≤1% 1%<Impact≤2% 2%<Impact<3% Junior Colleges ............................................................................................ Colleges, Universities, and Professional Schools ....................................... Computer Training ....................................................................................... Professional and Management Development Training ............................... Cosmetology and Barber Schools ............................................................... Flight Training .............................................................................................. Apprenticeship Training ............................................................................... Other Technical and Trade Schools ............................................................ Fine Arts Schools ......................................................................................... Sports and Recreation Instruction ............................................................... Language Schools ....................................................................................... Exam Preparation and Tutoring ................................................................... All Other Miscellaneous Schools and Instruction ........................................ Educational Support Services ...................................................................... Public Schools ............................................................................................. 10 2,126 13 15 89 192 37 171 74 10 282 8 26 2 1,248 0 15 0 3 1 4 2 9 2 0 4 0 4 0 0 1 10 0 0 1 3 0 3 3 0 0 0 2 0 0 11 2,151 13 18 91 199 39 183 79 10 286 8 32 2 1,248 Total Small Schools .............................................................................. 7,743 64 35 7,842 A school may seek recertification in the same year it adds a new physical location or campus that requires a site visit and then it may appeal the findings of a recertification. A recertification fee would not include a site visit to a new location. DHS proposes that this would be an increase of $2,580 ($1,250 I–17 recertification fee plus $655 for a site visit at a new location plus $675 for an appeal). Under this scenario, the impact on small schools’ revenue would be less Total than one percent for all but 139 small schools. The impact on these 139 schools’ revenues would be less than three percent as shown in Table 40. TABLE 40—IMPACT OF RECERTIFICATION FEE PLUS A SITE VISIT—NEW LOCATION FEE PLUS AN APPEAL FEE Type of school 0%<Impact≤1% 1%<Impact≤2% 2%<Impact<3% Elementary and Secondary Schools ........................................................... Junior Colleges ............................................................................................ Colleges, Universities, and Professional Schools ....................................... Computer Training ....................................................................................... Professional and Management Development Training ............................... Cosmetology and Barber Schools ............................................................... Flight Training .............................................................................................. Apprenticeship Training ............................................................................... Other Technical and Trade Schools ............................................................ Fine Arts Schools ......................................................................................... Sports and Recreation Instruction ............................................................... Language Schools ....................................................................................... Exam Preparation and Tutoring ................................................................... All Other Miscellaneous Schools and Instruction ........................................ Educational Support Services ...................................................................... Public Schools ............................................................................................. 3,426 10 2,110 13 15 87 191 37 167 74 10 279 8 26 2 1,248 28 0 24 0 3 2 5 2 8 2 0 6 0 4 0 0 18 1 17 0 0 2 3 0 8 3 0 1 0 2 0 0 3,472 11 2,151 13 18 91 199 39 183 79 10 286 8 32 2 1,248 Total Small Schools .............................................................................. 7,703 84 55 7,842 5. An Identification, to the Extent Practicable, of All Relevant Federal Rules That May Duplicate, Overlap, or Conflict With the Proposed Rule daltland on DSKBBV9HB2PROD with PROPOSALS4 DHS is unaware of any relevant Federal fee rule that may duplicate, overlap, or conflict with the proposed rule. VerDate Sep<11>2014 22:15 Jul 16, 2018 Jkt 244001 6. A Description of Any Significant Alternatives to the Proposed Rule Which Accomplish the Stated Objectives of Applicable Statutes and Minimize Any Significant Economic Impact of the Proposed Rule on Small Entities SEVP examined several alternatives to the proposed fee structure, including no increase to any fee, only increasing the I–901 SEVIS fee and I–17 fee, and not subsidizing the school fees with the I– 901 F and M fees. Without an increase in fees, SEVP will be unable to maintain the level of service for students and schools that it currently provides as well as the PO 00000 Frm 00031 Fmt 4701 Sfmt 4702 Total compliance and national security activities discussed above. SEVP considered the alternative of maintaining fees at the current level but with reduced services and increased processing times, but has decided that this would not be in the best interest of applicants and schools. SEVP seeks to minimize the impact on all parties, but in particular small entities. SEVP must pay for the expenses of maintaining and improving SEVIS and adjudicating schools in a timely manner. If SEVP followed this alternative scenario, there would be a shortfall of revenue to cover the expenses of over $65.4 million in FY 2019. SEVP rejected this alternative, as SEVP must pay for the expenses of E:\FR\FM\17JYP4.SGM 17JYP4 33792 Federal Register / Vol. 83, No. 137 / Tuesday, July 17, 2018 / Proposed Rules maintaining and improving SEVIS and certifying and recertifying schools in a timely manner. SEVP also considered only raising the I–901 and I–17 certification fees instead of including new proposed fees for recertification and for filing a motion or appeal. If SEVP followed this scenario, the I–901 F and M fee would increase to $350 to cover the shortfall in revenue, but the I–17 Initial Certification fee would also increase to $4,200. This would triple the existing certification fee while continuing to allow schools with no foreign students to remain active SEVP schools that require SEVP effort for recertification. SEVP rejected this fee structure as it would continue to add workload to SEVP’s recertification branch. Without a disincentive to not recertify, the list of schools recertifying would never stop growing. SEVP rejected this alternative because the proposed fees would establish a more equitable distribution of costs and a more sustainable level of cost recovery relative to the services provided as compared to this alternative. SEVP also considered the results of the ABC model as an alternative, which allocated the I–901 F and M fee, school certification fees, and the fee to file an appeal or motion as shown in Table 41. TABLE 41—UNSUBSIDIZED FEE AMOUNTS Fee type daltland on DSKBBV9HB2PROD with PROPOSALS4 I–901 F and M ...................... I–901 J-Full ........................... I–901 J-Partial ...................... I–17 Initial Certification ......... I–17 Recertification ............... Appeal or Motion .................. Site Visit ................................ Unsubsidized fee amounts $290 130 130 4,600 6,000 38,475 650 SEVP rejected this alternative for several reasons. Setting the fee at $38,475 may discourage schools from filing a motion or appeal. Similarly, SEVP rejected the alternative of setting the recertification fee at $6,000. A recertification fee higher than the initial certification fee would discourage schools from seeking recertification. SEVP instead proposes to set the recertification fee at a level is less than the initial certification fee. When schools can maintain their certification, F and M nonimmigrant students enrolled in the withdrawn school avoid complications such as being forced to transfer schools, leave the United States, or risk facing immigration law penalties for violating the terms of their nonimmigrant status. VerDate Sep<11>2014 22:15 Jul 16, 2018 Jkt 244001 SEVP also rejected the initial certification fee of $4,600 because it finds that an increase of almost three times the current fee of $1,700 is excessive. In the fee development, DHS balanced the challenge of minimizing the costs to schools and students while recovering funding to support SEVP services. The population of I–901 F and M students relative to the population of I–17 schools allows for a minimal fee adjustment to be spread over the student population to reduce the cost burden on individual institutions seeking recertification. DHS requests comment on the impacts on small entities of the unsubsidized fee amounts, impacts on small entities of the proposed fee amounts, and other ways in which DHS could modify the proposed rule to reduce burdens for small entities or better ensure that the burdens on small entities, individuals, and others subject to the rule are appropriately distributed. C. Unfunded Mandates Reform Act The Unfunded Mandates Reform Act of 1995 (UMRA), Public Law 104–4, 109 Stat. 48 (codified at 2 U.S.C. 1501 et seq.), requires federal agencies to assess the effects of their discretionary regulatory actions. In particular, UMRA addresses actions that may result in the expenditure by a State, local, or tribal government in the aggregate or by the private sector of $100 million (adjusted for inflation) or more in any 1 year. 2 U.S.C. 1532(a). Though this rule would not result in such an expenditure, DHS does discuss the effects of this rule elsewhere in this preamble. In addition, DHS maintains that this rulemaking is not a ‘‘Federal mandate,’’ as defined for UMRA purposes, 2 U.S.C. 658(6), as the payment of an SEVP certification fee by individuals, local governments, or other private sector entities is (to the extent it could be termed an enforceable duty) one that arises from participation in a voluntary Federal program (i.e., applying for status as F–1, F–3, M–1, or M–3 students or as a J–1 exchange visitor in the United States or seeking approval from the United States for attendance by certain aliens seeking status as F–1, F–3, or M–1 students). 2 U.S.C. 658(7)(A)(ii). For these reasons, no additional actions were deemed necessary under the provisions of the UMRA. D. Congressional Review Act This rulemaking is not a major rule, as defined by 5 U.S.C. 804, for purposes of congressional review of agency rulemaking pursuant to the Congressional Review Act, Public Law 104–121, sec. 251, 110 Stat. 868, 873 (codified at 5 U.S.C. 804). This PO 00000 Frm 00032 Fmt 4701 Sfmt 4702 rulemaking would not result in an annual effect on the economy of $100 million or more; a major increase in costs or prices; or significant adverse effects on competition, employment, investment, productivity, innovation, or the ability of U.S.-based companies to compete with foreign-based companies in domestic and export markets. If implemented as proposed, DHS will submit to Congress and the Comptroller General of the United States a report about the issuance of the final rule prior to its effective date, as required by 5 U.S.C. 801(a)(1). E. Small Business Regulatory Enforcement Fairness Act of 1996 Pursuant to Section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996, Public Law 104– 121, 110 Stat. 847, 858–59, DHS wants to assist small entities in understanding this proposed rule so that they can better evaluate its effects and participate in the rulemaking. If the proposed rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please consult ICE using the contact information provided in the FOR FURTHER INFORMATION CONTACT section. F. Executive Order 13132: Federalism A rule has implications for federalism under Executive Order 13132, Federalism, if it has substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government. DHS has analyzed this proposed rule under that Order and has determined that it does not have implications for federalism. G. Executive Order 12988: Civil Justice Reform This proposed rule meets the applicable standards set forth in 3(a) and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize litigation, eliminate ambiguity, and reduce burden. H. Energy Effects DHS has analyzed this proposed rule under Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use. DHS has determined that it is not a ‘‘significant energy action’’ under that order because it is a ‘‘significant regulatory action’’ under Executive Order 12866 but is not likely to have a significant adverse effect E:\FR\FM\17JYP4.SGM 17JYP4 Federal Register / Vol. 83, No. 137 / Tuesday, July 17, 2018 / Proposed Rules J. Paperwork Reduction Act daltland on DSKBBV9HB2PROD with PROPOSALS4 on the supply, distribution, or use of energy. I. Environment The U.S. Department of Homeland Security Management Directive (MD) 023–01 Rev. 01 establishes procedures that DHS and its Components use to comply with the National Environmental Policy Act of 1969 (NEPA), Public Law 91–190, 83 Stat. 852 (codified at 42 U.S.C. 4321–4375), and the Council on Environmental Quality (CEQ) regulations for implementing NEPA, 40 CFR parts 1500 through 1508. CEQ regulations allow federal agencies to establish categories of actions that do not individually or cumulatively have a significant effect on the human environment and, therefore, do not require an Environmental Assessment or Environmental Impact Statement. 40 CFR 1508.4. The MD 023– 01 Rev. 01 lists the Categorical Exclusions that DHS has found to have no such effect. MD 023–01 Rev. 01, Appendix A, Table 1. For an action to be categorically excluded, MD 023–01 Rev. 01 requires the action to satisfy each of the following three conditions: (1) The entire action clearly fits within one or more of the Categorical Exclusions. (2) The action is not a piece of a larger action. (3) No extraordinary circumstances exist that create the potential for a significant environmental effect. MD 023–01 Rev. 01 section V.B(1)–(3). Where it may be unclear whether the action meets these conditions, MD 023– 01 Rev. 01 requires the administrative record to reflect consideration of these conditions. MD 023–01 Rev. 01 section V.B. DHS has analyzed this proposed rule under MD 023–01 Rev. 01. DHS has made a preliminary determination that this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. This proposed rule clearly fits within the Categorical Exclusion found in MD 023–01 Rev. 01, Appendix A, Table 1, number A3(a): ‘‘Promulgation of rules . . . of a strictly administrative or procedural nature’’; and A3(d): ‘‘Promulgation of rules . . . that interpret or amend an existing regulation without changing its environmental effect.’’ This proposed rule is not part of a larger action. This proposed rule presents no extraordinary circumstances creating the potential for significant environmental effects. Therefore, this proposed rule is categorically excluded from further NEPA review. VerDate Sep<11>2014 22:15 Jul 16, 2018 Jkt 244001 33793 The Proposed Amendments All Departments are required to submit to OMB for review and approval any reporting or recordkeeping requirements inherent in a rule under the Paperwork Reduction Act of 1995, Public Law 104–13, 109 Stat. 163 (codified at 44 U.S.C. 3501 et seq.). Schools use SEVIS to petition for recertification. The recertification process requires schools to input data in SEVIS, print the Form I–17, and sign the form. The electronic data captured for the Form I–17 have been previously approved for use by OMB as one component of the data that are captured in SEVIS. The OMB Control Number for this collection is 1653–0038 (previously 1615–0066 before being transferred from USCIS to ICE). With the regulatory implementation of SEVIS (67 FR 60107, Sept. 25, 2002), most schools enrolled in SEVIS were petitioning for DHS recertification, rather than initial certification (i.e., enrolling F or M nonimmigrant students for the first time). The workload for both certification and recertification was included under OMB 1615–0066. The changes to the certification and recertification fees, as well as the I–901 fees, would require changes to SEVIS and the I–901 software to reflect the updated fee amounts, as these systems generate the pertinent petition and application forms. DHS would submit a revision to OMB with respect to any changes to existing information collection approvals. DHS’s institution of the fee for a motion or appeal with regard to a denial of school certification or recertification, or a withdrawal of such certification, would not require a form amendment to reflect the charging of the fee. The instructions associated with the Form I– 290B, which schools can currently use for such motions and appeals, contain information regarding the use associated with Form I–17 decisions and the $675 fee. For the reasons set forth in the preamble, the Department of Homeland Security proposes to amend 8 CFR parts 103 and 214 of Chapter I of Title 8 of the Code of Federal Regulations as follows: List of Subjects 8 CFR Part 103 Administrative practice and procedure, Authority delegations (Government agencies), Freedom of Information, Immigration, Privacy, Reporting and recordkeeping requirements, Surety bonds. 8 CFR Part 214 Administrative practice and procedure, Aliens, Employment, Foreign officials, Health professions, Reporting and recordkeeping requirements, Students. PO 00000 Frm 00033 Fmt 4701 Sfmt 4702 PART 103—IMMIGRATION BENEFITS; BIOMETRIC REQUIREMENTS; AVAILABILITY OF RECORDS 1. The authority citation for part 103 continues to read as follows: ■ Authority: 5 U.S.C. 301, 552, 552a; 8 U.S.C. 1101, 1103, 1304, 1356, 1365b; 31 U.S.C. 9701; Pub. L. 107–296, 116 Stat. 2135 (6 U.S.C. 1 et seq.); E.O. 12356, 47 FR 14874, 15557, 3 CFR, 1982 Comp., p. 166; 8 CFR part 2; Pub. L. 112–54. 2. Amend § 103.7 by revising paragraphs (b)(1)(ii)(B) and (H) and adding paragraph (b)(1)(ii)(O) to read as follows: ■ § 103.7 Fees. * * * * * (b) * * * (1) * * * (ii) * * * (B) Petition for Approval of School for Attendance by Nonimmigrant Student (Form I–17). For filing a petition for school certification: $3,000, plus: (1) A site visit fee of $655 for each location required to be listed on the form,, and (2) For filing a petition for school recertification: $1,250. * * * * * (H) Fee Remittance for Certain F, J, and M Nonimmigrants (Form I–901). The fee for Form I–901 is: (1) For F and M students: $350. (2) For J–1 au pairs, camp counselors, and participants in a summer work or travel program: $35. (3) For all other J exchange visitors (except those participating in a program sponsored by the Federal Government): $220. (4) There is no Form I–901 fee for J exchange visitors in federally funded programs with a program identifier designation prefix that begins with G–1, G–2, G–3, or G–7. * * * * * (O) Notice of Appeal or Motion (Form I–290B) filed with ICE SEVP. For a Form I–290B ‘‘Notice of Appeal or Motion,’’ filed with the Student and Exchange Visitor Program (SEVP): $675. * * * * * PART 214—NONIMMIGRANT CLASSES 3. The authority citation for part 214 is revised to read as follows: ■ E:\FR\FM\17JYP4.SGM 17JYP4 33794 Federal Register / Vol. 83, No. 137 / Tuesday, July 17, 2018 / Proposed Rules Authority: 6 U.S.C. 202, 236; 8 U.S.C. 1101, 1102, 1103, 1182, 1184, 1186a, 1187, 1221, 1281, 1282, 1301–1305, and 1372; section 643, Pub. L. 104–208, 110 Stat. 3009– 708; Pub. L. 106–386, 114 Stat. 1477–1480; section 141 of the Compacts of Free Association with the Federated States of Micronesia and the Republic of the Marshall Islands, and with the Government of Palau, 48 U.S.C. 1901 note, and 1931 note, respectively, 48 U.S.C. 1806; 8 CFR part 2. 4. Amend § 214.3 by revising paragraph (h)(2) to read as follows: ■ § 214.3 Approval of schools for enrollment of F and M nonimmigrants. * * * * (h) * * * (1) * * * (2) Recertification. Schools are required to file a completed petition for SEVP recertification before the school’s certification expiration date, which is 2 years from the date of their previous SEVP certification or recertification expiration date. The school must submit the proper nonrefundable recertification petition fee as provided in 8 CFR 103.7(b)(1)(ii)(B). SEVP will review a petitioning school’s compliance with the recordkeeping, retention, and reporting, and other requirements of paragraphs (f), (g), (j), (k), and (l) of this section, as well as continued eligibility for certification, pursuant to paragraph (a)(3) of this section. daltland on DSKBBV9HB2PROD with PROPOSALS4 * VerDate Sep<11>2014 22:15 Jul 16, 2018 Jkt 244001 5. Amend § 214.4 by revising the heading and paragraphs (a)(1) and (h) to read as follows: ■ § 214.4 Denial of certification, denial of recertification, or withdrawal of SEVP certification. (a) General—(1) Denial of certification. The petitioning school will be notified of the reasons and its appeal rights if a petition for certification is denied, in accordance with the provisions of 8 CFR 103.3(a)(1)(iii). A petitioning school denied certification may file a new petition for certification at any time. * * * * * (h) Appeals. A school may file an appeal of a denial or withdrawal no later than 15 days after the service of the decision by ICE. The appeal must state the reasons and grounds for contesting the denial or withdrawal of the approval. The appeal must be accompanied by the fee as provided in 8 CFR 103.7(b)(1)(ii)(O). * * * * * ■ 6. Amend § 214.13 by revising paragraph (a) to read as follows: § 214.13 SEVIS fee for certain F, J, and M nonimmigrants. (a) Applicability. The following aliens are required to submit a payment in the amount indicated for their status to the Student and Exchange Visitor Program (SEVP) in advance of obtaining nonimmigrant status as an F or M PO 00000 Frm 00034 Fmt 4701 Sfmt 9990 student or J exchange visitor, in addition to any other applicable fees, except as otherwise provided for in this section: (1) An alien who applies for F–1 or F– 3 status in order to enroll in a program of study at an SEVP-certified institution of higher education, as defined in section 101(a) of the Higher Education Act of 1965, as amended, or in a program of study at any other SEVPcertified academic or language training institution, including private elementary and secondary schools and public secondary schools, the amount of $350; (2) An alien who applies for J–1 status in order to commence participation in an exchange visitor program designated by the Department of State (DoS), the amount of $210, with a reduced fee for certain exchange visitor categories as provided in paragraphs (b)(1) and (c) of this section; and (3) An alien who applies for M–1 or M–3 status in order to enroll in a program of study at an SEVP-certified vocational educational institution, including a flight school, in the amount of $350. * * * * * Claire M. Grady, Deputy Secretary (Acting). [FR Doc. 2018–15140 Filed 7–16–18; 8:45 am] BILLING CODE 9111–28–P E:\FR\FM\17JYP4.SGM 17JYP4

Agencies

[Federal Register Volume 83, Number 137 (Tuesday, July 17, 2018)]
[Proposed Rules]
[Pages 33762-33794]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-15140]



[[Page 33761]]

Vol. 83

Tuesday,

No. 137

July 17, 2018

Part VI





 Department of Homeland Security





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U.S. Immigration and Customs Enforcement





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8 CFR Parts 103 and 214





Adjusting Program Fees for the Student and Exchange Visitor Program; 
Proposed Rule

Federal Register / Vol. 83 , No. 137 / Tuesday, July 17, 2018 / 
Proposed Rules

[[Page 33762]]


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DEPARTMENT OF HOMELAND SECURITY

U.S. Immigration and Customs Enforcement

8 CFR Parts 103 and 214

[DHS No. ICEB-2017-0003]
RIN 1653-AA74


Adjusting Program Fees for the Student and Exchange Visitor 
Program

AGENCY: U.S. Immigration and Customs Enforcement (ICE), Department of 
Homeland Security.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Department of Homeland Security (DHS) proposes to adjust 
fees charged by the Student and Exchange Visitor Program (SEVP) to 
individuals and organizations. DHS proposes to raise the fee for 
Student and Exchange Visitor Information System (SEVIS) Form I-901, Fee 
Remittance for Certain F, J, and M Nonimmigrants, for nonimmigrants 
seeking to become academic (F visa) or vocational (M visa) students 
from $200 to $350. For most categories of individuals seeking to become 
exchange (J visa) visitors, DHS proposes to increase the fee from $180 
to $220. For those seeking admission as J exchange visitors in the au 
pair, camp counselor, and summer work or travel program participant 
categories, DHS proposes to maintain the fee at $35. In addition to 
raising the student and exchange visitor fees, DHS proposes to increase 
the fee for submitting a school certification petition from $1,700 to 
$3,000. DHS proposes to maintain the fee for an initial school site 
visit at the current level of $655, but clarify that, with the 
effective date of the rule, DHS would exercise its current regulatory 
authority to charge the site visit fee not only when a certified school 
changes its physical location, but also when it adds a new physical 
location or campus. DHS proposes to establish and clarify two new fees: 
a $1,250 fee to submit a school recertification petition and a $675 fee 
to submit an appeal or motion following a denial or withdrawal of a 
school petition. Adjusting fees would ensure fee levels are sufficient 
to recover the full cost of activities of the program and would 
establish a fairer balance of the recovery of SEVP operational costs 
between beneficiary classes.

DATES: Send comments by September 17, 2018.

ADDRESSES: You may send comments, identified by Docket No. ICEB-2017-
0003, to the Federal Docket Management System (FDMS), a government-
wide, electronic docket management system, by any of the following 
methods:
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for sending comments.
     Mail: Address all comments to Sharon Snyder, Unit Chief, 
Student and Exchange Visitor Program, U.S. Immigration and Customs 
Enforcement, Department of Homeland Security, 500 12th Street SW, 
Washington, DC 20536. DHS docket staff, who maintain and process ICE's 
official regulatory dockets, will scan the submission and post it to 
FDMS.
    Collection of information. You must submit comments on the 
collection of information discussed in this notice of proposed 
rulemaking to both DHS's docket and the Office of Management and 
Budget's (OMB) Office of Information and Regulatory Affairs (OIRA). 
OIRA submissions can be sent using any of the following methods.
     Email (preferred): [email protected] (include 
the docket number and ``Attention: Desk Officer for U.S. Immigration 
and Customs Enforcement, DHS'' in the subject line of the email).
     Fax: 202-395-6566.
     Mail: Office of Information and Regulatory Affairs, Office 
of Management and Budget, 725 17th Street NW, Washington, DC 20503; 
Attention: Desk Officer, U.S. Immigration and Customs Enforcement, DHS.
    For additional instructions on sending comments, see the ``Public 
Participation'' heading of the SUPPLEMENTARY INFORMATION section of 
this document.

FOR FURTHER INFORMATION CONTACT: Sharon Snyder, Unit Chief, Student and 
Exchange Visitor Program; U.S. Immigration and Customs Enforcement, 
Department of Homeland Security; 500 12th Street SW, Washington, DC 
20536; 703-603-3400, [email protected]. This is not a toll-free number. 
Program information can be found at http://www.ice.gov/sevis/.

SUPPLEMENTARY INFORMATION: 

Table of Contents

I. Executive Summary
    A. Purpose of Regulatory Action
    B. Summary of Major Provisions
    C. Costs and Benefits
II. Abbreviations and Acronyms
III. Public Participation
    A. Submitting Comments
    B. Viewing Comments and Documents
    C. Privacy Act
IV. Program Background
    A. SEVP Legal Authorities
    B. SEVP and Development of SEVIS
    C. Authority To Collect Fees
    D. Full Cost Recovery
V. Proposed Adjustment of SEVP Fees
    A. Activities Funded Under the 2008 Fee Rule
    1. Improved SEVIS Functionality
    2. Oversight and Enforcement
    3. Recertification
    4. School Liaisons
    B. Continuing SEVP Activities Funded With Proposed Fees
    1. SEVIS Modernization
    2. Increased SEVP Adjudication Personnel
    3. Additional Investigatory Support
    C. Basis for Fee Schedule
    D. SEVP Baseline Costs and Fees
    E. Methodology
    1. ABC Approach
    2. Full Cost
    3. Cost Basis for SEVP Fees Based on Current Services
    F. Summary of the Full Cost Information
    1. Fee Allocation
    2. SEVP FY 2019 and FY 2020 Cost Model Results
    3. Fee Calculations
    4. Proposed Fee Levels
VI. Statutory and Regulatory Requirements
    A. Executive Orders 12866, 13563, and 13771: Regulatory Review
    1. Background and Purpose of the Proposed Rule
    2. Impacts of Regulatory Change
    3. Alternatives
    B. Regulatory Flexibility Act
    C. Unfunded Mandates Reform Act
    D. Congressional Review Act
    E. Small Business Regulatory Enforcement Fairness Act of 1996
    F. Executive Order 13132: Federalism
    G. Executive Order 12988: Civil Justice Reform
    H. Energy Effects
    I. Environment
    J. Paperwork Reduction Act
    List of Subjects
    The Proposed Amendments

I. Executive Summary

A. Purpose of Regulatory Action

    DHS proposes to adjust its fee schedule for students and exchange 
visitors as well as for petitioning and certified schools. These fees 
are associated with SEVP and SEVIS. They were last adjusted in 2008. 
See 73 FR 55683 (Sept. 26, 2008).
    SEVP, an ICE component, is funded entirely by fees charged to 
individual applicants and organizational petitioners. Fees collected 
from individuals and organizations are deposited into the Immigration 
Examinations Fee Account (IEFA) and used to fund the operational costs 
associated with SEVP and its management of SEVIS. See Immigration and 
Nationality Act (INA) section 286(m), as amended, 8 U.S.C. 1356(m), and 
Illegal Immigration Reform and Immigrant Responsibility Act of 1996, as 
amended, (IIRIRA) section 641(e), (g), 8 U.S.C. 1372(e), (g).

[[Page 33763]]

    In accordance with the requirements and principles of the Chief 
Financial Officers Act of 1990, 31 U.S.C. 901-03 (CFO Act), and OMB 
Circular A-25, SEVP reviews its associated fees that are deposited into 
the IEFA biennially and, if necessary, proposes adjustments to ensure 
recovery of costs necessary to meet national security, customer 
service, and adjudicative processing goals. SEVP completed a biennial 
fee review for fiscal year (FY) 2016 and FY 2017 in 2017. The projected 
results indicate that current fee levels are insufficient to recover 
the full cost of current and planned program activities. Section 286(m) 
of the INA, 8 U.S.C. 1356(m), provides that DHS may set fees for 
adjudication and naturalization services at a level that would ensure 
recovery of the full costs of providing such services, including the 
costs of providing similar services without charge to asylum applicants 
and certain other immigrants. Additionally, section 641 of IIRIRA, 8 
U.S.C. 1372, authorizes DHS to periodically revise fees that cover the 
cost of carrying out SEVP and maintenance of SEVIS. Pursuant to these 
laws, DHS proposes the adjustments contained in this rule.
    SEVP calculates the totality of its fees to recover the full cost 
of its overall operations. Following its biennial fee review, SEVP 
anticipates that if it continues to operate at current fee levels, it 
will experience a shortfall of approximately $68.9 million beginning in 
2019. At current fee levels, SEVP's current expenditures exceed current 
revenues, without any service upgrades. The deficit is covered by 
surplus revenue that was previously accumulated from 2009 to 2015. This 
surplus will be exhausted in FY 2019 even without any service upgrades. 
This projected shortfall poses a risk of degrading operations and 
services funded by fee revenue. The proposed fee increases would allow 
SEVP to cover the current deficit between revenue and expenditures plus 
make the necessary service upgrades. The proposed fee levels thus 
eliminate the risk of degrading operations, while also ensuring full 
cost recovery by providing fees for each specific benefit that will 
more adequately recover the cost associated with administering the 
benefit.

B. Summary of Major Provisions

    The proposed rule would adjust, institute, and clarify the 
application of fees pertaining to services SEVP provides to reflect 
existing and projected operating costs, program requirements, and 
continued planned program improvements, in the following manner:
     Increase the two types of individual student and exchange 
visitor application fees, specifically the F and M I-901 SEVIS fee from 
$200 to $350 and the full J-1 I-901 SEVIS fee from $180 to $220;
     Increase the SEVP school certification petition fee for 
initial certification from $1,700 to $3,000;
     Institute a stand-alone fee of $1,250 when a school files 
a petition for recertification of its existing SEVP certification;
     Revise regulations to ensure collection of a $675 fee to 
accompany the filing of a Form I-290B, Notice of Appeal or Motion, when 
a school appeals or files a motion to reconsider or reopen a denial or 
withdrawal of its SEVP certification; and
     Maintain the $655 fee for a site visit at its current 
level, but clarify that, with the effective date of the rule, SEVP 
would exercise its current regulatory authority to charge the site 
visit fee when a certified school changes its physical location or adds 
a new physical location or campus on its Form I-17, ``Petition for 
Approval of School for Attendance by Nonimmigrant Student.''
    In making these changes, the proposed rule would allow SEVP to 
fully fund activities and institute critical near-term program and 
system enhancements in a more equitable manner through a fairer balance 
of the recovery of SEVP operational costs between beneficiary classes. 
A summary of the current and future fee structures is provided in Table 
1 below.

C. Costs and Benefits

    SEVP proposes to adjust fees to the amounts listed in Table 1.

                                    Table 1--Current and Proposed Fee Amounts
----------------------------------------------------------------------------------------------------------------
                                                                                                    Incremental
                            Fee type                                Current fee    Proposed fee   fee adjustment
----------------------------------------------------------------------------------------------------------------
I-901 F/M.......................................................            $200            $350            $150
I-901 J-Full....................................................             180             220              40
I-901 J-Partial.................................................              35              35               0
I-17 Initial Certification......................................           1,700           3,000           1,300
I-17 Recertification............................................               0           1,250           1,250
Site Visit--initial.............................................             655             655               0
Site Visit--new location........................................               0             655             655
Appeal Fee......................................................               0             675             675
----------------------------------------------------------------------------------------------------------------

    SEVP expects to have a total annual increase in fees of $75.2 
million in FY 2019 transferred from individuals and entities for the 
services they receive. Table 2 shows the summary of the total annual 
number of payments, incremental fee amounts, and total fees transferred 
in FY 2019. This increase in fees would allow SEVP to not only maintain 
its current level of service but also enhance SEVP's capability to 
support national security and counter immigration fraud through the 
continued development and implementation of critical system and 
programmatic enhancements. Enhancements to SEVIS, including the 
establishment of a student portal, will assist designated school 
officials (DSOs) in their regulatory obligation to provide accurate and 
timely information and will also rebalance this reporting requirement 
by providing students an automated means to update their information. 
Increased numbers of adjudication personnel will assist in reducing the 
processing times for initial petitions, updates, and recertifications, 
while enhanced vetting protocols will ensure that only those 
nonimmigrant students who are eligible to enter and remain in the 
country do so.

[[Page 33764]]



                            Table 2--Annual Proposed Incremental Fee Amounts, FY 2019
----------------------------------------------------------------------------------------------------------------
                                                                     Projected       Proposed       Annual fees
                                                                     number of      incremental     transfer to
                                                                     payments       fee amounts     government
----------------------------------------------------------------------------------------------------------------
I-901 F and M...................................................         418,393            $150     $62,758,950
I-901 J-Full....................................................         157,550              40       6,302,000
I-17 Initial Certification......................................             426           1,300         553,800
I-17 Recertification............................................           4,373           1,250       3,279,750
Site Visits--initial............................................             426               0               0
Site Visits--new location.......................................             174             655         113,970
Appeals.........................................................              54             675          36,450
                                                                 -----------------------------------------------
    Total.......................................................  ..............  ..............      75,231,420
----------------------------------------------------------------------------------------------------------------

II. Abbreviations and Acronyms

ABC Activity-Based Costing
ARO alternate responsible officer
CBP U.S. Customs and Border Protection
CEU Compliance Enforcement Unit
CTCEU Counterterrorism and Criminal Exploitation Unit
CFO Chief Financial Officer
DHS Department of Homeland Security
DoS Department of State
DSO designated school official
EBSVERA Enhanced Border Security and Visa Entry Reform Act of 2002, 
Public Law 107-173; May 14, 2002
FASAB Federal Accounting Standards Advisory Board
FY Fiscal Year
HSPD-2 Homeland Security Presidential Directive-2
ICE U.S. Immigration and Customs Enforcement
IEFA Immigration Examinations Fee Account
IIRIRA Illegal Immigration Reform and Immigrant Responsibility Act 
of 1996, as amended
INA Immigration and Nationality Act of 1952, as amended
INS Immigration and Naturalization Service
IT information technology
NAICS North American Industry Classification System
OMB Office of Management and Budget
PDSO principal designated school official
RO responsible officer
RFA Regulatory Flexibility Act
RFE request for evidence
SBA Small Business Administration
SEVIS Student and Exchange Visitor Information System
SEVP Student and Exchange Visitor Program
SFFAS FASAB Statement of Federal Financial Accounting Standard
SSA Social Security Administration
TSA Transportation Security Administration
UMRA Unfunded Mandates Reform Act of 1995
USCIS U.S. Citizenship and Immigration Services

III. Public Participation

    We encourage you to participate in this rulemaking by submitting 
comments and related materials. All comments received will be posted 
without change to http://www.regulations.gov and will include any 
personal information you provide unless you request that your 
personally identifiable information be redacted. We also invite 
comments relating to the economic, environmental, energy, or federalism 
impacts that might result from this rulemaking action. See the 
ADDRESSES section for information on how to submit comments.

A. Submitting Comments

    If you submit comments, please include the docket number for this 
rulemaking, indicate the specific section of this document to which 
each comment applies, and provide reasons supporting each suggestion or 
recommendation. You may submit your comments and materials online or by 
mail, but please use only one of these means. We recommend that you 
include your name and a mailing address, an email address, or a phone 
number in the body of your document so that we can contact you if we 
have questions regarding your submission. ICE will file all comments 
sent to our docket address, as well as items sent to the address or 
email address listed in the FOR FURTHER INFORMATION CONTACT section, in 
the public docket, except for comments containing marked confidential 
information. If you submit a comment, it will be considered received by 
ICE when it is received at the Docket Management Facility.
    To submit your comments online, go to http://www.regulations.gov 
and insert the complete docket number starting with ``ICEB'' in the 
``Search'' box. Click on the ``Comment Now!'' box and enter your 
comment in the text box provided. Click the ``Continue'' box, and if 
you are satisfied with your comment, follow the prompts to submit it. 
If you submit your comments by mail, submit them in an unbound format, 
no larger than 8\1/2\ by 11 inches, suitable for copying and electronic 
scanning and filing. Mailed submissions may be on paper or CD-ROM. If 
you would like ICE to acknowledge receipt of comments submitted by 
mail, include with your comments a self-addressed, stamped postcard or 
envelope on which the docket number appears. We will stamp the date of 
receipt on the postcard and mail it to you.
    We will consider all comments and materials received during the 
comment period and may change this proposed rule based on your 
comments. The docket is available for public inspection before and 
after the comment closing date.

B. Viewing Comments and Documents

    To view comments, as well as documents mentioned in this preamble 
as being available in the docket, go to http://www.regulations.gov and 
insert the complete docket number starting with ``ICEB'' in the 
``Search'' box. Click on the ``Open Docket Folder'' and then click on 
``View Comment'' or ``View All'' under the ``Comments'' section of the 
page. Individuals without internet access can make alternate 
arrangements for viewing comments and documents related to this 
rulemaking by contacting ICE through the FOR FURTHER INFORMATION 
CONTACT section previously listed. Note: Because the software used in 
computing these fees proposed in this rule is a commercial product 
licensed to ICE, it may be accessed on-site by appointment by calling 
the SEVP Response Center at (800) 892-4829.

C. Privacy Act

    Anyone can search the electronic form of comments received in any 
of our dockets by the name of the individual submitting the comment (or 
signing the comment, if submitted on behalf of an association, 
business, labor union, etc.). You may wish to consider limiting the 
amount of personal information that you provide in any voluntary public 
comment submission you make to DHS. DHS may withhold information from 
public viewing that it determines may affect the privacy of an 
individual or is offensive. For additional information, please read the 
Privacy and Security

[[Page 33765]]

Notice posted on http://www.regulations.gov.

IV. Program Background

A. SEVP Legal Authorities

    IIRIRA (Pub. L. 104-208, div. C, 110 Stat. 3009-546 (1996)) 
established the requirement for the monitoring and reporting of the 
activities of foreign students and exchange visitors while they reside 
in the United States (U.S.). Section 641 of IIRIRA, 8 U.S.C. 1372, 
mandated that the Attorney General develop and conduct a program for 
the electronic collection of data by U.S.-approved (i.e., certified) 
institutions of higher education, other approved educational 
institutions, and designated exchange visitor programs, to monitor 
nonimmigrants possessing or applying for F, M, and J class visas with a 
Certificate of Eligibility.\1\
---------------------------------------------------------------------------

    \1\ Under INA section 101(a)(15)(F)(i), 8 U.S.C. 
1101(a)(15)(F)(i), a foreign student may be admitted into the United 
States in nonimmigrant status to attend an academic or accredited 
language training school (F nonimmigrant students). Under INA 
section 101(a)(15)(M)(i), 8 U.S.C. 1101(a)(15)(M)(i), a foreign 
student may be admitted into the United States in nonimmigrant 
status to attend a vocational education school (M nonimmigrant 
students). An F or M nonimmigrant student may enroll in a particular 
school only if the Secretary of Homeland Security has certified the 
school for the attendance of such students. Under INA section 
101(a)(15)(j), 8 U.S.C. 1101(a)(15)(j), a foreign citizen may be 
admitted into the United States in nonimmigrant status as an 
exchange visitor (J visa) in an exchange program sponsored by the 
Department of State (DoS).
---------------------------------------------------------------------------

    In addition, President George W. Bush issued Homeland Security 
Presidential Directive 2 (HSPD-2) in October 2001, which requires DHS 
to conduct periodic, ongoing recertification of all schools certified 
to accept F or M students. Combating Terrorism Through Immigration 
Policies, Oct. 29, 2001, as amended by HSPD--5 (Management of Domestic 
Incidents, Feb. 28, 2003, Compilation of HSPDs (updated through Dec. 
31, 2007), available at http://www.gpo.gov/fdsys/pkg/CPRT-110HPRT39618/pdf/CPRT-110HPRT39618.pdf.
    The Homeland Security Act of 2002 created DHS, transferred a broad 
range of immigration authorities from the Attorney General and the 
Commissioner of Immigration and Naturalization to the Secretary of 
Homeland Security, and vested ICE with responsibility for 
administration of the electronic data collection system, also known as 
SEVIS. See Public Law 107-296, sec. 442(a)(4), 116 Stat. 2136, 2193-94 
(codified at 6 U.S.C. 252(a)(4) (vesting SEVIS-related authority in 
``Bureau of Border Security''); Reorganization Plan Modification for 
the Department of Homeland Security, H.R. Doc. No. 108-32, at 3-4 
(2003) (set forth as a note to 6 U.S.C.A. 542 (West 2018)) (renaming 
``Bureau of Border Security'' as ``Bureau of Immigration and Customs 
Enforcement''); DHS Delegation 7030.2(2)(Z) (2004) (affirming 
delegation of such authority from Secretary of Homeland Security to 
ICE). ICE assumed responsibility for SEVIS and established SEVP. DHS 
has issued regulations that address data collection requirements for 
SEVP certification, oversight, and recertification of schools 
authorized to enroll F or M students. 8 CFR 214.3, 214.4.

B. SEVP and Development of SEVIS

    SEVP is responsible for developing, maintaining, and improving 
SEVIS, which is an internet-based application that facilitates timely 
electronic reporting and monitoring of nonimmigrant students, exchange 
visitors, and their dependents in the United States. SEVIS enables 
schools and program sponsors to transmit electronic information to DHS 
and the Department of State (DoS) throughout a student's or exchange 
visitor's program in the United States. SEVIS is intended to improve 
customer service by streamlining the application and adjudication 
processes. Through continuing modernization efforts, it addresses 
issues in student and school system processes by providing information 
technology (IT) solutions and modifying business processes.
    Schools and exchange visitor programs have been required to enter 
F, M, and J nonimmigrant data into SEVIS since August 1, 2003. As of 
April 1, 2017, SEVIS contained 1.4 million active F, M, and J student 
and exchange visitor records. Approximately 8,700 schools are SEVP-
certified and approximately 1,500 exchange visitor programs are DoS-
designated.
    SEVIS enables DHS and DoS to efficiently administer their approval 
(i.e., certification and designation, respectively) and oversight 
processes of schools and programs that wish to benefit from enrolling 
nonimmigrants. SEVIS assists law enforcement agencies in tracking and 
monitoring F, M, and J nonimmigrant status and apprehending violators 
before they can potentially endanger the national security of the 
United States. SEVIS also assists other federal agencies such as DoS, 
and other DHS components such as U.S. Citizenship and Immigration 
Services (USCIS) and U.S. Customs and Border Protection (CBP) in better 
serving F, M, and J nonimmigrant applicants. Finally, SEVIS enables 
schools and exchange visitor programs to instantaneously transmit 
electronic information and changes in required information on F, M, and 
J nonimmigrants to ICE and DoS throughout their stays in the United 
States.\2\ These include required notifications, reports, and updates 
to personal data. SEVIS allows schools to submit school certification 
applications, update certification information, submit updates to DHS 
that require adjudication, and also create and update F visa (academic) 
and M visa (vocational) student and dependent records. SEVP managers 
and adjudicators have the capability to adjudicate updates made to 
school records using SEVIS, and principal designated school officials 
(PDSOs) and designated school officials (DSOs) are notified through 
SEVIS of the adjudication results. SEVIS also allows program sponsors 
to submit designation forms for the J-1 visa program, create program 
designations, and update program designation information. DoS personnel 
have the capability to adjudicate information submitted by responsible 
officers (ROs) and alternate responsible officers (AROs). ROs and AROs 
are notified through SEVIS of any adjudication results.
---------------------------------------------------------------------------

    \2\ An individual seeking F or M nonimmigrant student status 
must apply to an SEVP-certified school and be accepted for 
enrollment. From the enrollment information provided by the 
nonimmigrant, the school enters student information into SEVIS and 
issues a Form I-20, ``Certificate of Eligibility for Nonimmigrant 
Student Status.'' The individual must submit a valid Form I-20 when 
applying for an F or M visa. Similarly, an individual seeking J-1 
nonimmigrant status must apply to a DoS-designated exchange visitor 
program and be accepted for enrollment as a basis to apply for a J 
exchange visitor visa. From the information provided by the accepted 
individual, the exchange visitor program enters exchange visitor 
information into SEVIS and issues a Form DS-2019, ``Certificate of 
Eligibility for Exchange Visitor (J-1) Status.'' The applicant must 
submit a valid Form DS-2019 when applying for a J visa.
---------------------------------------------------------------------------

    SEVIS shares information with other agencies' and components' 
systems--DoS, USCIS, CBP, Transportation Security Administration (TSA), 
and others--to better monitor the status of student or exchange 
visitors throughout their stays in the United States. This allows DHS 
to meet the aims of the USA PATRIOT Act. See Public Law 107-56, sec. 
416, 115 Stat. 272, 354-55 (2001). In addition, that Act mandates that 
the Secretary of Homeland Security,\3\ in consultation with the 
Secretary of State, collect information on the date of entry and port 
of entry for each nonimmigrant for whom information is collected under 
IIRIRA section 641. Id. at sec. 416(b).
---------------------------------------------------------------------------

    \3\ The USA PATRIOT Act refers to the Attorney General, but the 
Homeland Security Act of 2002, as amended, transferred the functions 
of the Immigration and Naturalization Service (INS) to DHS. Public 
Law 107-296, tit. IV, subtits. D, E, F, 116 Stat. 2135, 2192 (Nov. 
25, 2002), as amended.

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

[[Page 33766]]

C. Authority To Collect Fees

    The Secretary is specifically authorized to collect fees for SEVP 
from prospective F and M students and J exchange visitors, subject to 
certain limits for certain J-1 nonimmigrants. 8 U.S.C. 1372(e)(1). The 
Secretary is authorized to periodically revise those fees, with certain 
exceptions, to take into account changes in the overall cost of 
carrying out the program. IIRIRA section 641(e)(4)(A), (g)(2), 8 U.S.C. 
1372(e)(4)(A), (g)(2). Similarly, section 286(m) of the INA authorizes 
the Secretary to collect fees for adjudication and naturalization 
services at a level that would ensure recovery of the full costs of 
providing such services, including the costs of providing similar 
services without charge to asylum applicants and certain other 
immigrants. Additionally, pursuant to INA section 286(m), the level 
that is set may include recovery of any additional costs associated 
with the administration of the fees themselves. Under this authority, 
user fees are employed not only for the benefit of the payer of the fee 
and any collateral benefit resulting to the public, but also to provide 
a benefit to certain others.\4\
---------------------------------------------------------------------------

    \4\ The longstanding interpretation of DHS is that the 
``including'' clause in section 286(m) does not constrain DHS's fee 
authority under the statute. The ``including''' clause offers only a 
non-exhaustive list of some of the costs that DHS may consider part 
of the full costs of providing adjudication and naturalization 
services. See 8 U.S.C. 1356(m); 81 FR 26903, 26906 n.10 (May 4, 
2016).
---------------------------------------------------------------------------

    All fees collected under these authorities are deposited as 
offsetting receipts into the IEFA and are available to the Secretary 
until expended for authorized purposes. See IIRIRA section 
641(e)(4)(B), 8 U.S.C. 1372(e)(4)(B); INA section 286(m), 8 U.S.C. 
1356(m). DHS proposes the revised fee schedule contained in this rule 
in accordance with the above-referenced authorities.
    As a general matter, in developing fees and fee rules, DHS looks to 
a range of governmental accounting provisions. OMB Circular A-25, User 
Charges (Revised), para. 6, 58 FR 38142 (July 15, 1993), defines ``full 
cost'' to include all direct and indirect costs to any part of the 
Federal government for providing a good, resource, or service. These 
costs include, but are not limited to, an appropriate share of the 
following: Direct and indirect personnel cost, physical overhead, 
consulting and other indirect cost, management and supervisory cost, 
enforcement, information collection and research, and establishment of 
standards and regulation, including any required environmental review.
    Section 31.5 of OMB Circular A-11, Preparation, Submission and 
Execution of the Budget, July 1, 2016, directs agencies to develop user 
charge estimates based on the full cost recovery policy set forth in 
OMB Circular A-25, User Charges (budget formulation and execution 
policy regarding user fees).
    The Federal Accounting Standards Advisory Board (FASAB) Statement 
of Federal Financial Accounting Standards (SFFAS) No. 4: Managerial 
Cost Accounting Concepts and Standards for the Federal Government, July 
31, 1995, updated June 2017, provides the standards for managerial cost 
accounting and full cost. SFFAS No. 4 defines ``full cost'' to include 
``direct and indirect costs that contribute to the output, regardless 
of funding sources.'' \5\ FASAB identifies various classifications of 
costs to be included and recommends various methods of cost assignment 
to identify full cost. Activity-based costing (ABC) is highlighted as a 
costing methodology useful to determine full cost within an agency.
---------------------------------------------------------------------------

    \5\ See FASAB, Statement of Federal Financial Accounting 
Standards 4: Managerial Cost Accounting Standards and Concepts 26 
(June 2017), available at http://files.fasab.gov/pdffiles/handbook_sffas_4.pdf (last visited Feb. 20, 2018).
---------------------------------------------------------------------------

    The Chief Financial Officers Act of 1990, 31 U.S.C. 901-903, 
requires each agency's Chief Financial Officer (CFO) to ``review, on a 
biennial basis, the fees, royalties, rents and other charges imposed by 
the agency for services and things of value it provides, and make 
recommendations on revising those charges to reflect cost incurred by 
it in providing those services and things of value.'' 31 U.S.C. 
902(a)(8).
    This proposed rule would eliminate the risk of a projected 
shortfall for SEVP operations and services funded by fee revenue. It 
proposes increased funding that supports continuing and new initiatives 
critical to improving the program and reflects the implementation of 
specific cost-allocation methods to segment program costs to the 
appropriate fee--F and M students, J exchange visitors, or schools.

D. Full Cost Recovery

    Consistent with these authorities and sources, this proposed rule 
would ensure that SEVP recovers the full costs for the services it 
provides and maintains a projected level of service necessary to 
fulfill its mission. The proposed rule would do this in two ways. 
First, where possible, the proposed rule sets fees at levels sufficient 
to cover the full cost of the corresponding services and assigns these 
fees to those who are the primary beneficiaries. DHS works with OMB and 
generally follows OMB Circular A-25, which ``establishes federal policy 
regarding fees assessed for Government services and for sale or use of 
Government goods or resources.'' See OMB Circular A-25, User Charges 
(Revised), para. 6, 58 FR 38142 (July 15, 1993). A primary objective of 
OMB Circular A-25 is to ensure that federal agencies recover the full 
cost of providing specific services to users and associated costs.
    This proposed rule would set fees at a level sufficient to fund the 
full cost of conducting the program and general operations for FY 2019. 
See INA sec. 286(m), 8 U.S.C. 1356(m). DHS has interpreted this 
statutory fee-setting authority, including the authorization for DHS to 
collect ``full costs'' for providing, in pertinent part, ``adjudication 
. . . services,'' as granting DHS broad discretion to charge fees at a 
level that will ensure recovery of all direct and indirect costs 
associated with providing pertinent immigration adjudication services. 
This approach is also consistent with the SEVP-specific fee authority 
referenced above, which authorizes DHS to set fees at a level that 
funds the full cost of conducting the program. See IIRIRA section 
641(e), 8 U.S.C. 1372(e).
    In following OMB Circular A-25 to the extent appropriate, including 
its direction that fees should be set to recover the costs of an 
agency's services in their entirety and that full costs are determined 
based on the best available records of the agency, DHS accounts for the 
reality that costs of all SEVP operations cannot always be directly 
correlated to certain specific fees. DHS therefore applies the 
discretion provided in the above authorities, in taking the following 
actions: (1) Employing ABC to establish a model for assigning costs to 
specific benefit requests in a manner reasonably consistent with OMB 
Circular A-25; (2) distributing costs that are not attributed to or 
driven by specific adjudication services;[thinsp]and (3) making 
additional adjustments to effectuate specific policy objectives.

V. Proposed Adjustment of SEVP Fees

    This proposed rule would amend the current fee structure governing 
the collection of fees from individuals by increasing the individual 
student and exchange visitor application fee (I-901 SEVIS fee). In 
addition, the rule proposes to amend the fee structure paid by schools 
by increasing the SEVP school certification petition costs for initial 
certification, instituting a fee to address school recertification 
costs for the ongoing recertification process, and

[[Page 33767]]

requiring a fee to accompany the filing of an appeal, a motion to 
reconsider, or a motion to reopen filed by a school organization. SEVP 
proposes no change to the current fee for site visits. The proposed 
fees for recertification petitions and appeals and motions would better 
recover a reasonable portion of related existing and projected 
operating costs, program requirements, and planned program 
improvements.
    Fees were last adjusted in 2008. 73 FR 55683. Refined and expanded 
SEVP operations, SEVIS modifications, as well as inflation, have 
increased SEVP operating costs and are the basis for the proposed 
increases to the I-901 SEVIS fee and the school certification petition 
fee.

A. Activities Funded Under the 2008 Fee Rule

    In the 2008 rulemaking that resulted in the most recent agency 
adjustment, ``Adjusting Program Fees and Establishing Procedures for 
Out-of- Cycle Review and Recertification of Schools Certified by the 
Student and Exchange Visitor Program To Enroll F and/or M Nonimmigrant 
Students'' (2008 Fee Rule), DHS outlined its rationale for a fee 
increase by identifying a set of organizational initiatives essential 
to its mission: Improving SEVIS functionality, improving oversight and 
enforcement, implementing recertification procedures, and developing 
school liaison activity. 73 FR 55683. SEVP, in accordance with its 
commitment to the goals prescribed in that rule, has implemented the 
following actions since then:
1. Improved SEVIS Functionality
    SEVP's original plan to roll out a comprehensive overhaul of SEVIS 
(known as SEVIS II) was replaced by an approach that focused on a 
series of smaller and more targeted SEVIS enhancements--now termed 
SEVIS Modernization. New technologies have become available since the 
comprehensive SEVIS overhaul was first envisioned. The use of these 
technologies enables SEVP to apply many of the functionalities that 
were planned for SEVIS II to the current system. At the same time, this 
approach eliminates potential risks and complications that result from 
migrating mass quantities of critical data from one system to the next, 
which would have been necessary if the SEVIS II approach had been fully 
implemented. Building on the experience, knowledge, and stakeholder 
feedback acquired during the planning process, SEVP has launched 
hundreds of smaller-scale SEVIS enhancements. These efforts have 
addressed the majority of national security vulnerabilities previously 
identified, by improving critical system functionalities that support 
data integrity in SEVIS, including establishing system functions that 
support standardization of student and exchange visitor name and 
address data entry. The enhancements have also improved system 
performance for end users. With the introduction of more detailed SEVIS 
event history and new abilities for DSOs to create student data 
reports, these enhancements enable action on multiple student records 
simultaneously.
    As an example, SEVP, in collaboration with CBP, developed and 
implemented an admissibility indicator tool that links to real-time 
SEVIS data to assist CBP officers at ports of entry in determining 
whether F, M, and J nonimmigrants may enter the United States based on 
their SEVIS record status. Prior to the availability of the 
admissibility indicator, first-line CBP officers relied on paper 
documentation that the nonimmigrant student or exchange visitor 
presented. Today, the admissibility indicator gives CBP officers a 
quick assessment of the most pertinent and current SEVIS data that are 
necessary in determining whether nonimmigrant students, exchange 
visitors, and their dependents are eligible to enter the United States 
or require further investigation. As a result, CBP officers are able to 
use the admissibility indicator at points of inspection to quickly 
verify the information contained on the paper documentation that is 
also required for entry. This assists in reducing long wait times, aids 
with detecting and preventing visa fraud, and otherwise enhances 
compliance efforts and national security.
2. Oversight and Enforcement
    A dedicated compliance enforcement program that includes criminal 
investigative efforts is an integral part of ensuring the operational 
effectiveness of SEVP. By analyzing SEVIS data, SEVP identifies 
indicators of potential misuse or abuse of nonimmigrant status and 
provides leads to Counterterrorism and Criminal Exploitation Unit 
(CTCEU) law enforcement personnel for further investigation. At the 
time the 2008 Fee Rule was published, the Compliance Enforcement Unit 
(CEU), the predecessor of CTCEU, was not sufficiently staffed to 
address all leads generated from SEVIS. As a result, only the highest 
priority leads were investigated, which left open unaddressed 
vulnerabilities. With the increased I-901 SEVIS fee revenue, DHS has 
hired additional personnel and currently funds 234 Homeland Security 
Investigations (HSI) positions with primary responsibility for 
nonimmigrant violator investigations. The increased number of HSI 
personnel assigned to support CTCEU investigations has enabled more 
robust coordination between SEVP and CTCEU and has successfully reduced 
the exploitation of the laws and programs relating to nonimmigrant 
students and exchange visitors. An example of the result of such close 
and extensive cross-coordination was the conviction of the founder and 
president of Tri-Valley University (TVU) on 31 counts in March 2014, 
ranging from conspiracy to commit visa fraud and alien harboring to 
money laundering.\6\ SEVP will continue to support cooperation and 
coordination with CTCEU to maintain the viability of F, M, and J 
student and exchange visitor programs within the United States.
---------------------------------------------------------------------------

    \6\ See Sentencing Memorandum, Docket Item No. 195 (Oct. 24, 
2014), United States v. Su, Case No.11-cr-00288 (N.D. Cal.), 2, 8, 
available at https://www.courtlistener.com/docket/4178123/195/united-states-v-su/; see also Jury Verdict, Docket Item No. 119 
(Mar. 24, 2014), United States v. Su, supra, available at https://www.courtlistener.com/docket/4178123/119/united-states-v-su/.
---------------------------------------------------------------------------

3. Recertification
    SEVP implemented the recertification procedure prescribed in the 
2008 Fee Rule beginning with its first recertification cycle in 2010. 
Institutions that participated in the first cycle have been reviewed 
several times and will continue to undergo the recertification process 
every two years. Because there are thousands of schools, 
recertification is a rolling process allowing adjudicators to address 
issues with one school before moving on to the next.
    Each school is notified 2 years to the month following the date of 
its last recertification or certification about its need to file for 
recertification in order to maintain its certification. From that date, 
the school has 180 days to file for recertification. 8 CFR 
214.3(h)(2)(i). This cycle helps ensure that only schools that operate 
in accordance with the law remain certified by SEVP.
4. School Liaisons
    SEVP deployed the first group of field representatives in April 
2014, followed by three additional groups later in 2014 and 2015, 
bringing the national total to 60 field representatives distributed 
among three geographically determined units. The field representatives 
serve as liaisons between SEVP and SEVP-certified schools that enroll F 
and M

[[Page 33768]]

nonimmigrant students and have conducted more than 32,500 school visits 
since the unit launch. Field representatives serve as a key resource 
for schools by providing individualized instruction on the SEVP 
certification and recertification processes. They also educate DSOs on 
Federal statutes, regulations, and guidance pertinent to F and M 
students studying in the United States. Because DSOs are responsible 
for entering F and M nonimmigrant data into SEVIS, the data integrity 
of the system depends heavily on the DSOs' understanding the importance 
of accurate and timely reporting of the required information. By 
providing individualized assistance to DSOs, the field representatives 
enhance national security by maintaining and improving the data 
integrity of SEVIS.

B. Continuing SEVP Activities Funded With Proposed Fees

    In developing this proposed rule, SEVP reviewed its current and 
projected costs, identified goals for services, analyzed projected 
future workload, and allocated costs to specific services. In addition 
to the full SEVP operating costs described in the following sections, 
the proposed fees would fund the continuing efforts identified in the 
2008 rule, now updated to reflect technological refinements and 
operational enhancements. These updated activities include SEVIS 
modernization and increases in adjudication support and investigatory 
and compliance personnel.
1. SEVIS Modernization
    SEVIS is a web-based system that schools and program sponsors use 
to transmit information about their programs and participating F, M, 
and J nonimmigrants. It became fully operational in February of 2003, 
replacing a paper-based F, M, and J nonimmigrant process.
    Since its inception, SEVIS has evolved well beyond its original 
purpose as a data collection tool. Today, approximately 35,000 
officials from approved schools and program sponsors use SEVIS data to 
manage 1.4 million F, M, and J nonimmigrants and their dependents 
during their stays in the United States. SEVIS provides real-time 
administrative and enforcement information to DHS components, including 
CBP and USCIS, as well as DoS. SEVIS also receives information about F, 
M, and J nonimmigrant visa applications, entry and exit records, and 
benefit applications from these entities through various interfaces. 
This makes SEVIS a critical national security component and a primary 
resource for law enforcement and intelligence communities to extract 
the data necessary to conduct counterterrorism and counterintelligence 
threat analysis.
    The threat of new forms of terrorism and other criminal activity 
exploiting the Nation's immigration laws continues to be a public 
safety and national security concern in the United States. As a result, 
there is an increasing need for sophisticated SEVIS data analysis to 
detect individuals who engage in immigration fraud or otherwise pose a 
risk to national security through willful misrepresentation. In 
addition, end users from schools and program sponsors have expressed 
concerns and provided feedback reflecting the necessity to create SEVIS 
functionalities that enable the accurate reporting of new and 
innovative educational program models. While SEVIS has been modified to 
meet the most critical needs through hundreds of upgrades and patches, 
including adding abilities for the system to preemptively address data 
input errors, system functionality concerns (due to time lags, system 
constraints, and other system design limitations) continue to affect 
all SEVIS users and necessitate continuous development of SEVIS design. 
In response, SEVP has begun an effort--known as SEVIS Modernization--
that involves redesigning the entire system over time in prioritized 
increments. Continued Modernization will increase security by providing 
real-time, person-centric data. This data will reduce fraud and 
increase awareness by providing government officials with actionable 
intelligence with which to make decisions and initiate immigration 
actions. Informed decisions and efficient investigations allow for 
better management of F, M, and J nonimmigrant data and preventing high-
risk individuals from entering the United States.
    To address critical system limitations and improve the SEVIS user 
experience, SEVP has identified the following list of key SEVIS 
modernization priorities for continued funding through the increased I-
901 SEVIS Fee revenue:
     Student Portal. F-1 students engaged in authorized 
optional practical training are required to report their contact and 
employer information to DHS. See 8 CFR 214.2(f)(12), (f)(17). At 
present, students report the required information to their DSOs, who 
then report the information in SEVIS. By regulation, students must 
report any new required information to their DSOs within 10 days of the 
change, and the DSOs must report such information in SEVIS within 21 
days. 8 CFR 214.2(f)(17).
    This external SEVIS student portal will enable students to directly 
add or edit the required contact and employer information so that their 
SEVIS record would be updated in real time. This will reduce processing 
redundancies and lessen the potential for data entry errors by 
eliminating the need for the student to first report such information 
to the DSO who will then enter the reported data into SEVIS. The portal 
will also consequently reduce the workload of DSOs and make the 
reported data available to DHS sooner. With future expansion, the 
portal will address SEVIS vulnerabilities related to accurate 
monitoring of F, M, and J nonimmigrant status and location of 
nonimmigrant students and exchange visitors by closing national 
security vulnerabilities related to person-centric, paperless, people-
matching capabilities. In establishing a portal for student use in this 
manner, DHS will encourage students to assume responsibility for 
maintaining their immigration status, reduce the system's reliance on 
paper-driven processes, and reinforce the operational premise and 
security advantages of ``one person, one record.'' Through use of a 
record-matching protocol, all SEVIS records will be collated and 
presented as a unified, person-centric statement of information and 
activity. These summaries will be available to all operational 
entities, including school officials, who will have access in the SEVIS 
record to the same up-to-date information, including all student 
history.
     Support of the Adjudication Process. As part of 
maintaining their SEVP certification, schools are required to update 
certain information in SEVIS about their operations and programs any 
time such information changes. See 8 CFR 214.3(g)(2). SEVP is required 
to adjudicate such changes. SEVP currently receives, on average, 350 
weekly updates from schools; each update may contain several subparts, 
including school contact information changes and additions of new 
programs. At present, system constraints require SEVP adjudicators to 
adjudicate all parts of the update simultaneously and to deny the 
entire update if even one part of the update cannot be approved. This 
causes additional workload and delays for schools and adjudicators due 
to resubmissions of updates. The new SEVIS functionality that supports 
adjudication will provide SEVP and DoS with enhanced flexibility to 
adjudicate school certification and exchange visitor sponsor 
designation updates and applications and consequently enable SEVP and 
DoS to

[[Page 33769]]

adjudicate updates and applications more efficiently.
     Automated Data Tracking. Currently, SEVP and DoS manually 
monitor SEVIS data for potential noncompliance indicators with regard 
to schools, students, and exchange visitor program participants and 
sponsors. In FY 2016, manual monitoring yielded 75 compliance 
investigations, which resulted in withdrawal of certification for 21 
noncompliant schools. Automated SEVIS data tracking functionality would 
provide SEVP and DoS with enhanced abilities to track and monitor 
compliance. This additional capability would allow SEVP and DoS to more 
quickly detect data trends that are potential indicators of fraudulent 
activities. With the use of automation, SEVP anticipates a 100 percent 
increase in fraudulent activity flags (from 75 to 150 per year), which 
is estimated to significantly increase the detection rate of 
noncompliant schools and subsequent withdrawals of SEVP certification 
due to noncompliance. Such functionality would play an important role 
in ensuring the integrity of the Nation's immigration system.
    SEVIS Access Approval Tracking System (SAATS). School officials 
(PDSOs and DSOs) and program officials (AROs and ROs) constitute the 
largest and most critical component of SEVIS users as they are 
responsible for entering the initial student and exchange visitor data 
into SEVIS. Their need to access the system is confirmed by petition 
through their sponsoring school or program. Once granted access, 
designated school and program officials confirm their ongoing need for 
access in a yearly validation exercise in which a delayed response or 
no response results in automatic system access denial.
    Unlike government employees who need access to SEVIS to perform 
official functions, school and program officials have not had to meet 
uniform security requirements. Recently, SEVP began conducting national 
criminal background checks on designated school officials (DSOs). SEVP 
has vetted all DSOs at K-12 schools and, since May 2017, has vetted all 
newly designated DSOs, helping to ensure the safety of nonimmigrant 
students and exchange visitors and preserve the integrity of SEVIS 
data. SEVP is considering eventually extending this screening and 
security review to DSOs and ROs who were appointed prior to May 2017 
and other school and program officials through regulatory action. SEVP 
will bear the upfront cost of this security review. When fully 
implemented, all individuals who require access to SEVIS will be vetted 
prior to being granted such access. DHS will complete the vetting 
adjudication for the RO or ARO and provide a copy of its decision to 
the DoS Bureau of Educational and Cultural Affairs.
    This initiative will strengthen the mechanism for approving user 
access to SEVIS. DHS and DoS rely on PDSOs, DSOs, ROs, and AROs as key 
links in the process to mitigate potential threats to national security 
and ensure compliance with immigration law. DHS would require that 
anyone nominated to serve as a PDSO, DSO, RO, or ARO receive a 
favorable SEVIS Access Approval Process (SAAP) assessment prior to 
their appointment and subsequent approval for access to SEVIS.
     Information Sharing. SEVIS currently shares information 
and exchanges data with 11 intra-governmental interface partners. The 
modernized Information Sharing module will be capable of sharing data 
contained in modernized SEVIS data stores with existing interface 
partners. Other interfaces to support modernized capabilities in other 
modules, including paperless capabilities, are being considered to 
address SEVIS vulnerabilities. The centralization of all information-
sharing capabilities in a single module will allow for efficiencies in 
development efforts, system performance, and sustainability.
     Use of Cloud Technologies. The cloud infrastructure effort 
supports the program by providing flexible, efficient, and cost-
effective cloud services and infrastructure to facilitate and enable 
agile development and testing processes. While SEVIS actively mitigates 
known security threats, it lacks functionalities to proactively analyze 
end user data to detect potential misuse. The use of cloud technologies 
will permit increased analysis of SEVIS end user data and increase the 
efficiency and security of controlling and managing access to SEVIS by 
users not affiliated with DHS, both governmental and nongovernmental. 
In addition, it will enable more efficient management of user names and 
passwords and allow credentials to be safely passed among system 
components. Such analysis is necessary to create defined alerts about 
user activity that is indicative of risk factors to prompt timely 
criminal and compliance investigations. The cloud infrastructure module 
supports the program by providing flexible, efficient, and cost-
effective cloud services and infrastructure to facilitate and enable 
agile development and testing processes.
    This planned modernization effort, with implementation during FY 
2018-2021, is expected to greatly enhance the capability of DHS to 
identify and reduce national security threats; reduce the possibility 
for reporting errors by prospective and approved F, M, and J 
nonimmigrants, as well as their schools and programs; and better 
provide updated, correct, real-time information to academic, law 
enforcement, and other government users. SEVP projects that the cost 
for developing and deploying these SEVIS modifications is $53.19 
million. SEVP would incur $13.15 million of that cost in FY 2018, 
$13.75 million in FY 2019, $13.14 million in FY 2020, and $13.15 
million in FY 2021.
2. Increased SEVP Adjudication Personnel
    In 2008, DHS proposed to recertify all schools approved for 
attendance by F and M students every 2 years, pursuant to title V, 
section 502 of EBSVERA and HSPD-2, and established procedures for the 
review of each SEVP-certified school every 2 years, as well as out-of-
cycle reviews whenever it determines that clarification or 
investigation of school performance or eligibility is necessary. 
Recertification is a determination of performance and compliance with 
required standards in the period since the previous certification. In 
this comprehensive review of an SEVP-certified school by an SEVP 
adjudicator, SEVP affirms that the school remains eligible and is 
complying with regulatory recordkeeping, retention, reporting, and 
other requirements.
    Performance is monitored through SEVIS, DHS records, submissions 
from the school, and possible onsite reviews. If noncompliance is 
discovered, SEVP requires schools, as appropriate, to make corrections 
immediately. SEVP reviews the school's compliance with Federal law and 
regulations.
    In recent years, the scope of work of SEVP adjudication has 
expanded to include administrative compliance enforcement, support of 
criminal investigations, and adjudication of school petitions, 
including certification petitions, recertification petitions, and 
updates to school information. As a result, SEVP adjudicators have 
experienced significant workload increases, which in turn have resulted 
in longer SEVP adjudication processing times of school petitions and 
student compliance issues.
    Since initiating recertification, SEVP has determined that the 
current number of SEVP adjudication personnel is inadequate to meet the 
congressional requirement for recertifying or

[[Page 33770]]

withdrawing all currently certified schools every 2 years. At present 
staffing levels, SEVP is able to process 1,939, or 44 percent, of the 
required annual projected 4,400 recertification cases.
3. Additional Investigatory Support
    Investigations of violations of immigration status, as well as 
criminal investigations of F and M students and J exchange visitors, 
are primarily coordinated by CTCEU. Information is received, collated, 
and analyzed from a number of DHS and other information sources, 
including SEVIS, to generate national security leads for field 
personnel and prevent terrorists and other criminals from exploiting 
the Nation's immigration system through fraud. In its continuing 
support of compliance efforts, SEVP seeks to fund activities in two key 
areas: Support for and integration of technological advances and surge 
support for critical incidents.
    New technologies have enabled sophisticated methods of extracting 
and analyzing data. To make best use of these technology force 
multipliers, personnel would use the available technologies to develop 
investigative packages based on SEVIS research and use of other 
designated government computer systems, open source websites, and other 
pertinent information sources related to individual students, exchange 
visitors, and SEVP-certified schools. To the extent that adequate 
resources are allocated and employed for this purpose, increased 
support levels would reduce the vulnerability of the United States to 
terrorist attacks and reduce the potential for exploitation of 
certified schools and designated exchange visitor programs.
    Through the fee adjustments proposed in this rule, SEVP would 
continue ensuring funding to enable a surge for investigatory efforts, 
including increased contract overtime or surge staffing, in advance of 
planned critical overstay enforcement operations. SEVP would also fund 
the surge of continuous and extended analytic support to HSI field 
operations in the event of a terrorist attack or during imminent threat 
situations. This direct operational support to field elements during 
heightened threat situations or in the aftermath of an attack would 
enable CTCEU to quickly assess subjects of investigative interest and 
to share information to further investigations with its law enforcement 
partners, ICE legal counsel, and the U.S. Attorney's Office. Such surge 
support has been used successfully and has proven critical in 
furthering investigative efforts and providing investigative focus in 
recent threat situations and terrorist attacks, including attacks in 
San Bernardino, California; Orlando, Florida; Columbus, Ohio; 
Baltimore, Maryland; New York; New Jersey; and Fort Lauderdale, 
Florida.

C. Basis for Fee Schedule

    As previously noted, the proposed amended fees comply with 
statutory and regulatory requirements that SEVP review its fee 
structure every 2 years to ensure that the cost of the services 
provided are fully captured by fees assessed on those receiving the 
services. The new fees are an estimate of the current and projected 
costs of funding needed to continue enhancing SEVP's capability to 
achieve programmatic goals associated with its statutory mandate--
supporting national security and countering immigration fraud through 
the continued development and implementation of critical system and 
programmatic enhancements. This proposed rule would establish the 
following fee structure detailed in Table 3.

                     Table 3--Proposed Fee Structure
------------------------------------------------------------------------
             Fee type                         Responsible party
------------------------------------------------------------------------
I-901 SEVIS Fee...................  Student or exchange visitor issued
                                     an initial Form I-20 or DS-2019
                                     seeking an F, M, or J visa.
I-17 Certification Fee............  Institutions petitioning for SEVP
                                     certification to enroll
                                     international students.
Site Visit Fee....................  Institutions applying for initial
                                     certification or certified schools
                                     changing locations or adding a
                                     campus/location.
Recertification Fee...............  Certified institutions seeking
                                     recertification every 2 years.
Appeal or Motion Fee..............  Institutions that have had
                                     certification or recertification
                                     denied by SEVP, including denied I-
                                     17 updates, or that have had
                                     certification withdrawn, and which
                                     are filing an appeal or motion
                                     regarding the SEVP decision.
------------------------------------------------------------------------

    The current fee structure includes the I-901 SEVIS fee, I-17 
certification fee, and the site visit fee. The proposed rule would 
allow SEVP to fully fund activities and institute critical near-term 
program and system enhancements in a more equitable manner. The 
proposed fee structure would also include the addition of a 
recertification fee and a fee for filing a motion or appeal.
    With this rule SEVP proposes to impose a fee for a Form I-290B, 
Notice of Appeal or Motion, filed with SEVP at a level that is 
comparable to the fee for the Form I-290B when filed with USCIS. DHS 
proposes to eliminate regulations that currently state there is no fee 
required for an appeal by a school, to maintain consistency with this 
clarification in the motions context and to more fairly balance 
allocation of the recovery of SEVP operational costs between 
beneficiary classes. Under this proposal, SEVP would charge the fee for 
all appeals and motions.
    The proposed rule would ensure the full recovery of SEVP 
operational costs in a manner that fairly allocates costs between 
beneficiary classes and would facilitate the development of activities 
designed to achieve defined program goals. For example, the proposed 
rule would continue funding for critical SEVIS modernization efforts 
and would incorporate the added cost of increased analytical support 
for investigative and enforcement operations into the I-901 SEVIS fee. 
The proposed fee schedule would also allow SEVP to fully fund 
additional SEVP adjudication personnel.

D. SEVP Baseline Costs and Fees

    SEVP fees are paid by individuals and organizations. DHS certifies 
schools that enroll F and M students; recertifies schools with active 
certifications; conducts site visits; administers, maintains, and 
develops SEVIS; collects fees from prospective F and M students and J 
exchange visitors, as well as from schools; adjudicates motions and 
appeals in regard to certification petitions; undertakes investigatory 
initiatives; and provides overall guidance to schools about program 
enrollment and compliance, as well as the use of SEVIS. These 
activities are funded solely through the collection of fees.
    The I-901 SEVIS fee, collected from students and exchange visitors, 
currently underwrites the operation of

[[Page 33771]]

SEVP; the cost of administering, maintaining, and developing SEVIS; the 
cost of school recertification; and all activities related to 
individual and organizational compliance issues within the jurisdiction 
of SEVP. These activities include the cost of investigating the 
compliance of schools participating in SEVP and exchange visitor 
programs, as well as investigations in which F, M, or J nonimmigrants 
are identified as potential threats to national security or where it is 
suspected that an immigration violation or fraud may be occurring.
    The certification fee is paid by schools that petition for the 
authority to issue Certificates of Eligibility (COE), commonly referred 
to as Forms I-20, to prospective nonimmigrant students for the purpose 
of their applying for F or M visas and admission to the United States 
in those statuses. These monies fund the base internal cost for SEVP to 
process and adjudicate the initial school certification petition (Form 
I-17, ``Petition for Approval of School for Attendance by Nonimmigrant 
Student''). The proposed recertification fee paid by schools to remain 
certified would fund the cost of adjudicating the recertification 
petition.
    If SEVP finds that a petitioning or certified school does not meet 
regulatory standards, it will deny the affected school's Form I-17 or 
withdraw its SEVP certification. 8 CFR 214.4. When SEVP sends a school 
a notice of denial or withdrawal, the notice also includes reasons for 
the unfavorable decision(s), an explanation of the school's rights, and 
the applicable appeal and motion filing information and deadlines. In 
many cases, a school may file an appeal or motion to reopen and/or 
reconsider unfavorable decisions issued by SEVP by filing the Form I-
290B, ``Notice of Appeal or Motion,'' pursuant to the process set forth 
in 8 CFR 103.3(a) or 103.5(a).\7\ A school may initiate a motion to 
reopen or reconsider to request that the original deciding body review 
the unfavorable decision, including an appeals decision, pursuant to 
requirements in 8 CFR 103.5(a). A school may also initiate an appeal in 
order to request review of the unfavorable Notice of Denial, Automatic 
Withdrawal, or Withdrawal on Notice by an authority independent of the 
original deciding body. Currently, DHS uses I-901 funds to offset the 
costs of SEVP appeals and motions. This offset is a result of the DHS 
determination in the 2008 final fee rule to state in regulations that 
no fee would be required for appeals relating to SEVP certification or 
recertification or a withdrawal of SEVP certification. See 8 CFR 
214.4(a)(1), (h). DHS proposes to remove the SEVP-related exceptions to 
the payment of the I-290B fee and add regulatory text at proposed 8 CFR 
103.7(b)(1)(ii)(O) providing for the fee of $675 when the Form I-290B 
is filed with SEVP. This fee would apply when schools or institutions 
file an appeal or motion with regard to a denied petition for initial 
certification or recertification or a withdrawal of certification.
---------------------------------------------------------------------------

    \7\ Form I-290B is managed by USCIS and not ICE. USCIS has 
agreed to the use of the form by ICE for SEVP appeals and the use 
has been approved by the Office of Management and Budget under 
control number 1615-0095.
---------------------------------------------------------------------------

    In proposing these regulatory changes for the I-290B filing fee, 
DHS would more fairly balance allocation of the recovery of SEVP 
operational costs among beneficiary classes. To date, the cost of 
adjudicating appeals and motions has never been placed directly upon 
the beneficiaries of those adjudications--the schools seeking to obtain 
or maintain SEVP-certification. The fee for filing the Form I-290B with 
SEVP is being proposed at a level that requires those who file the Form 
I-290B to pay for at least a portion of the operating expenses for DHS 
to adjudicate the I-290B, while preventing the fee from becoming cost 
prohibitive.
    The site visit fee is currently paid by schools that petition for 
certification to issue Forms I-20 or by a certified school when it 
physically moves to a new location. DHS established this fee in the 
2008 Fee Rule and with that rule codified SEVP's authority to charge 
the fee when a school changes its physical location or adds a new 
physical location or campus. See 8 CFR 103.7(b)(3)(ii)(B), 8 CFR 
214.3(h)(3)(i), (h)(3)(ii). Specifically, the 2008 Fee Rule imposed a 
site visit fee of $655 for each location listed on the Form I-17, and 
required the Form I-17 to include ``any physical location in which a 
nonimmigrant can attend classes through the school (i.e., campus, 
extension campuses, satellite campuses, etc.).'' See 73 FR 55683, 
55698-55699 (amending 8 CFR 103.7(b)(3)(ii)(B) and 214.3(a)(1), 
respectively). The 2008 Fee Rule also imposed a continuing duty on 
schools to update school locations as changes arise, i.e., even after 
initial certification, a school must update SEVIS within 21 days of a 
change to a range of information types, including school location and 
campus location. See 73 FR 55683, 55700 (amending 8 CFR 214.3(g)(2), 
(h)(3)). Consistent with the aforementioned regulatory amendments, the 
preamble to the 2008 Fee Rule made clear that these provisions require 
the imposition of a site visit fee for each location listed on the 
initial SEVP certification, as well as each location added as part of 
an initial event, such as a SEVIS update requesting approval of a 
changed or new location or campus. 73 FR 55683, 55691.
    But SEVP is not currently collecting the fee when a certified 
school adds a new physical location or campus. SEVP intends to begin 
imposing the fee following the effective date of any final rule. The 
site visit fee would apply when a certified school updates its Form I-
17 in SEVIS to indicate, pursuant to 8 CFR 214.3(h)(3)(ii), it is 
changing its physical location or adding a new physical location or 
campus. This revenue would assist in recovering the costs DHS incurs 
for site visits of these locations, including collecting evidence on 
school eligibility for certification, reviewing the facilities, and 
interviewing personnel nominated on the petition to become DSOs, 
including the person nominated to be the PDSO.

E. Methodology

    SEVP captured and allocated cost using an ABC approach to define 
full cost, outline the sources of SEVP cost, and define the fees. The 
ABC approach also provides detailed information on the cost and 
activities allocated to each fee.
1. ABC Approach
    SEVP used CostPerform ABC modeling software, Version 9.3 (0147), to 
determine the full cost associated with updating and maintaining SEVIS 
to collect and maintain information on F, M, and J nonimmigrants; 
certifying schools; overseeing school compliance; recertifying schools; 
adjudicating appeals; investigating suspected violations of immigration 
law and other potential threats to national security by F, M, or J 
nonimmigrants; providing outreach and education to users; and 
performing regulatory and policy analysis. SEVP also used the model to 
identify management and overhead costs associated with the program.
    ABC is a business management methodology that links inputs (cost) 
and outputs (products and services) by quantifying how work is 
performed in an organization (activities). The ABC methodology allows 
fee-funded organizations to trace service costs and to calculate an 
appropriate fee for the service, based on the cost of activities 
associated with the services for which the fee is levied.
    Using the ABC methodology, SEVP identified and defined the 
activities needed to support SEVP functions to include current and 
future initiatives. SEVP captured the full cost of

[[Page 33772]]

operations and apportioned that full cost to the appropriate program 
activities. The full cost of each activity is then assigned to the 
appropriate fee category based on the nature of the activity, as 
described further below. By tracking costs to the various fee 
categories, SEVP was able to use forecasted payments to determine the 
appropriate fee amount for each fee type. SEVP examined historical data 
and performed statistical payment analysis to forecast payments in 
future years.
    SEVP used an independent contractor and commercially available ABC 
software to compute the fees. The structure of the software was 
tailored to SEVP needs for continual and real-time fee review and cost 
management.
2. Full Cost
    In building the ABC model, it was critical for SEVP to identify the 
sources and cost for all elements of the program. Consistent with 
instructive legislative and regulatory guidance, SEVP fees recoup the 
full cost of providing the agency's overall resources and services.\8\
---------------------------------------------------------------------------

    \8\ These include but are not limited to: Direct and indirect 
personnel cost, including salaries and fringe benefits, such as 
medical insurance and retirement; retirement cost, including all 
(funded or unfunded) accrued cost not covered by employee 
contributions, as specified in OMB Circular A-11; overhead, 
consulting, and other indirect cost, including material and supply 
cost, utilities, insurance, travel, as well as rents or imputed 
rents on land, buildings, and equipment; management and supervisory 
cost; and cost of enforcement, collection, research, establishment 
of standards, and regulation.
---------------------------------------------------------------------------

    To the extent applicable, SEVP used the cost accounting concepts 
and standards recommended in the FASAB Handbook, Version 15, 
``Statement of Financial Accounting Standards Number 4, Managerial Cost 
Accounting Concepts and Standards for the Federal Government'' (2016). 
FASAB Standard Number 4 sets the following five standards as 
fundamental elements of managerial cost accounting: (1) Accumulate and 
report cost of activities on a regular basis for management information 
purposes; (2) establish responsibility segments and match the cost of 
each segment with its outputs; (3) determine the full cost of 
government goods and services; \9\ (4) recognize the costs of goods and 
services provided among federal entities; and (5) use appropriate 
costing methodologies to accumulate and assign costs to outputs.
---------------------------------------------------------------------------

    \9\ Full cost includes the costs associated with resources that 
directly or indirectly contribute to the output and supporting 
services within the entity and from other entities.
---------------------------------------------------------------------------

    SEVP calculates projected fees using the full cost of operations, 
as defined by a regularly updated spend plan. The projected spend plans 
for FY 2019 and FY 2020 were used in calculation of SEVP's proposed fee 
structure. Tables 4 through 7 detail the full cost of SEVP operations, 
consistent with the spend plan, from various perspectives: By program 
category, by cost initiative, by fee type, and by activity.
3. Cost Basis for SEVP Fees Based on Current Services
    The FY 2019 and FY 2020 budgets provide the cost basis for the 
fees. These budgets reflect the required revenue to sustain current 
initiatives. The revenue is also assessed to ensure a sufficient level 
of continued funding for program enhancements as discussed above, such 
as enhanced vetting and investigative analysis to support enforcement 
operations, SEVIS Modernization, and increased numbers of adjudication 
personnel. Finally, the past budgets provide the cost basis for 
adjusting annualized cost-of-living increases.
    Determining the projected cost for continuation of current efforts 
involved routine budget projection processes. The budget establishes 
the current services of the program and projects the mandatory and 
cost-of-living adjustments necessary to maintain current services. The 
budget adjusts the services provided by SEVP to include enhancements 
that reflect program policy decisions. Table 4 reflects the FY 2017 
final budget, the FY 2018 approved budget, and the FY 2019 and FY 2020 
planned budget requests.

   Table 4--Student and Exchange Visitor Program Summary of Requirements by Organization and Program Category
                                             [Dollars in thousands]
----------------------------------------------------------------------------------------------------------------
                                                    2017 spend      2018 spend      2019 spend      2020 spend
                  SEVP expenses                        plan            plan            plan            plan
----------------------------------------------------------------------------------------------------------------
                                                  SEVP Payroll
----------------------------------------------------------------------------------------------------------------
Full-Time Equivalent Personnel..................             134             175             221             221
Executive Office................................          $1,735          $1,744          $2,048          $2,084
Fee Management Section..........................          $1,350          $1,597          $1,775          $1,806
Field Representative Unit.......................          $6,480          $6,958          $7,641          $7,776
Policy Section..................................          $1,178            $969          $1,283          $1,325
Systems Management Unit.........................          $1,258          $1,299          $1,391          $1,416
SEVP Response Center Section....................            $652            $652            $931            $941
School Certification Unit.......................          $2,993          $2,966          $3,291          $3,349
SEVP Analysis and Operations Section............          $1,070          $1,226          $1,402          $1,388
New Required Positions..........................  ..............            $296          $2,357          $5,610
Office of the Principal Legal Advisor...........            $328            $517            $642            $659
SEVP Outside Positions..........................          $1,444          $1,776          $2,545          $2,629
                                                 ---------------------------------------------------------------
    Total SEVP Payroll..........................         $18,488         $20,000         $25,306         $28,983
----------------------------------------------------------------------------------------------------------------
                                                Program Expenses
----------------------------------------------------------------------------------------------------------------
Advisory and Assistance Services................         $58,630         $58,108         $52,755         $50,977
SEVIS (Modernization and O&M) *.................          $8,237         $18,722         $22,241         $21,912
Interagency Agreements with other agencies......          $8,046          $9,815          $8,360          $8,583
Travel..........................................          $1,474          $1,500          $1,100          $1,100
Service-wide Costs..............................          $3,222          $4,015          $2,400          $2,400
                                                 ---------------------------------------------------------------
    Total Program Expenses......................         $79,609         $92,160         $86,856         $84,972

[[Page 33773]]

 
CTCEU...........................................         $67,200         $74,450         $74,450         $74,450
                                                 ---------------------------------------------------------------
    Total, SEVP.................................        $165,297        $186,610        $186,612        $188,405
----------------------------------------------------------------------------------------------------------------
* Includes costs for the SEVIS Modernization and SEVIS Operations and Maintenance.

F. Summary of the Full Cost Information

    The total cost projection for FY 2019 is $186,612,000 and for FY 
2020 is $188,405,000. Table 4 sets out the projected current services 
for SEVP and supporting CTCEU personnel in FY 2019 ($74.45 million) and 
FY 2020 ($74.45 million). These costs are direct extensions of the FY 
2018 costs that are supported by the current fees. Table 5 summarizes 
the enhancements and other costs, which include investigative analysis 
to support enforcement operations, SEVIS Modernization, increased 
numbers of adjudication personnel, and annualized inflation.

                          Table 5--FY 2018, FY 2019 and FY 2020 SEVP Cost by Initiative
----------------------------------------------------------------------------------------------------------------
                                                                      FY 2018         FY 2019         FY 2020
                   Program cost by initiative                      budgeted cost   budgeted cost   budgeted cost
                                                                    (thousands)     (thousands)     (thousands)
----------------------------------------------------------------------------------------------------------------
Program Base:
    SEVP (Current operational costs)............................         $95,097         $94,497         $95,106
    CTCEU (Current operational costs)...........................          70,200          70,200          70,200
                                                                 -----------------------------------------------
        Subtotal................................................         165,297         164,697         165,306
Enhancements and Other Costs:
    Investigative Analysis Support..............................           4,250           4,250           4,250
    SEVIS Modernization.........................................          13,150          13,750          13,141
    Increased Personnel.........................................           1,100           1,100           3,500
    Annualized Inflation........................................           2,813           2,813           2,208
                                                                 -----------------------------------------------
        Subtotal................................................          21,313          21,913          23,099
                                                                 -----------------------------------------------
            Total...............................................         186,610         186,610         188,405
----------------------------------------------------------------------------------------------------------------

1. Fee Allocation
    The purpose of the ABC methodology is to trace costs to 
organizational elements, as well as identify all cost components 
associated with the services offered. For fee-based organizations such 
as SEVP, this allows the assignment of cost to one or more fees. SEVP 
defined five fee categories: The I-901 SEVIS fee, certification fee, 
recertification fee, fee for motions and appeals, and site visit fee.
    Historically SEVP has only collected fees from students and 
exchange visitors--the I-901 fee--and from schools applying for 
certification, to include a separate site visit fee. In this analysis, 
SEVP considered the creation of additional fee categories for all the 
distinct services it provides in deciding how to apportion fees. For 
example, SEVP considered charging a separate I-901 SEVIS fee to F, M, 
and J dependents. SEVP also examined various tiered fee structures and 
considered assigning some specific costs to separate fees. The ABC fee 
model allowed SEVP to evaluate these scenarios. DHS opted for an 
updated fee structure that segments program cost to the appropriate 
fee--F and M students, J exchange visitors, or schools.
    The proposed I-901 SEVIS fee would recover the systems cost for 
SEVIS, including the remainder of certification, recertification, site 
visits, as well as appeals and motions costs that are not covered by 
the respective proposed fees. The fee would be apportioned between 
three categories--full fee of $350 for F and M students, reduced fee of 
$220 for most J participants, and the further reduced fee of $35 for 
certain J program participants. Federal Government-sponsored J program 
participants are fee-exempt by law, so their costs will be funded by 
other fee payers. 8 U.S.C. 1372(e)(3).
    The proposed school certification fee would recover a portion of 
the costs necessary to process initial school certifications. The 
proposed recertification fee would recover a portion of the cost to 
process school recertifications and a portion of SEVP administrative 
costs. The site visit fee would recover the full cost of performing the 
site visit for initial school certification and when a school changes 
its physical location or adds a new physical location or campus. The 
proposed fee for an appeal or motion would recover a portion of the 
cost to process an appeal or motion.
2. SEVP FY 2019 and FY 2020 Cost Model Results
    Table 6 shows the summary of SEVP FY 2019 and FY 2020 cost by 
source of cost.

[[Page 33774]]



      Table 6--Total SEVP FY 2019 and FY 2020 Cost by Fee Category
------------------------------------------------------------------------
                                              FY 2019         FY 2020
     SEVP ABC model output category        budgeted cost   budgeted cost
                                            (thousands)     (thousands)
------------------------------------------------------------------------
I-901 SEVIS Fee.........................        $159,835        $160,633
I-17 Certification Fee..................           1,909           1,992
I-17 Recertification Fee................          22,522          23,189
Site Visit Fee..........................             385             389
Appeals Fee.............................           1,956           2,198
                                         -------------------------------
    Total...............................         186,607         188,401
------------------------------------------------------------------------

    Table 7 shows a more detailed cost breakdown. The numbers are shown 
in thousands, rather than millions, of dollars due to the level of 
detail. There are two levels for the costs: Process and activity. Costs 
are allocated from payroll, contracts, and other expenses to activities 
through activity surveys and volume based cost allocations. The full 
cost of operations from the spend plans is distributed to the 
activities that best describe the work being performed. Table 7 details 
these costs from an activity perspective. To simplify the presentation, 
the numbers are rounded to the nearest thousand. These numbers are not 
rounded in the cost model.

                                                            Table 7--Detailed Cost Breakdown
                                                          [FY 19 + FY 20, dollars in thousands]
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                               I-17          I-17 re-        I-17 site
                Process                              Activity                  I-901       certification   certification       visit          Appeals
--------------------------------------------------------------------------------------------------------------------------------------------------------
Certify Schools........................  A-01: Certify schools (initial   ..............          $3,115  ..............  ..............  ..............
                                          certification).
                                         A-02: Recertify schools........  ..............  ..............          $4,614  ..............  ..............
                                         A-03: Notify students if school  ..............  ..............             129  ..............  ..............
                                          is withdrawn.
                                         A-04: Withdraw schools from      ..............  ..............           1,102  ..............  ..............
                                          SEVIS.
                                         A-05: Process appeals/motions..  ..............  ..............  ..............  ..............          $3,420
                                         A-06: Process petition updates.  ..............  ..............           3,036  ..............  ..............
                                         A-07: Monitor school compliance  ..............  ..............           3,761  ..............  ..............
                                         A-08: Monitor school risk......  ..............  ..............           3,446  ..............  ..............
Enforce Compliance with Regulations and  A-28: Conduct Student and               $93,921  ..............          16,574  ..............  ..............
 Laws.                                    Exchange Visitor (I-901)
                                          investigations.
                                         A-29: Conduct school and                 34,238  ..............           6,042  ..............  ..............
                                          sponsor investigations.
                                         A-30: Operate CTCEU programs...           4,130  ..............             729  ..............  ..............
                                         A-31: Provide CTCEU liaison                 417  ..............              74  ..............  ..............
                                          support.
                                         A-41: Perform I-515 operations            1,471  ..............  ..............  ..............  ..............
                                          duties.
                                         A-43: PDSO/DSO background                 1,038  ..............              54  ..............  ..............
                                          checks.
Formulate Policy.......................  A-16: Analyze and develop                 3,170  ..............             600  ..............  ..............
                                          policy.
                                         A-17: Develop and review rules            2,476  ..............             469  ..............  ..............
                                          and regulations.
                                         A-18: Implement policy.........           1,501  ..............             284  ..............  ..............
                                         A-19: Develop future policy                 816  ..............             154  ..............  ..............
                                          strategy.
Provide Stakeholder Communications.....  A-11: Develop and deliver SEVP            9,040             118           1,224              24             130
                                          communications.                          8,218  ..............  ..............  ..............  ..............
                                         A-12: Respond to stakeholders'
                                          policy and technical inquiries
                                          (including Tier III Help Desk).
                                         A-13: Provide Field                      13,731  ..............           2,598  ..............  ..............
                                          Representative support.
                                         A-14: Prepare and attend                  3,404              62             644              13              68
                                          conferences/workshops related
                                          to the SEVIS community.
                                         A-15: Develop and conduct                 2,699              49             511  ..............  ..............
                                          strategic communications.
Provide Systems Program Management       A-20: Modify and enhance                 24,816  ..............  ..............  ..............  ..............
 Support.                                 functionality of SEVP mission
                                          systems (e.g., SEVIS, SEVPAMS
                                          10).
                                         A-21: Operate and maintain SEVP          28,491  ..............  ..............  ..............  ..............
                                          mission systems (e.g., SEVIS,
                                          SEVPAMS).
                                         A-22: Provide Tier I and Tier            12,814  ..............  ..............  ..............  ..............
                                          II Help Desk support.
                                         A-23: Conduct systems program             5,291  ..............  ..............  ..............  ..............
                                          management.
                                         A-24: Analyze and disseminate             3,510              46             475               9              50
                                          program data.
                                         A-25: Operate and maintain SEVP           1,735              32             328  ..............  ..............
                                          inter-office systems.
Support SEVP Operations................  A-26: Maintain SEVP systems               2,867              37             388  ..............  ..............
                                          security.                                  223               4              42               1               4
                                         A-27: Maintain SEVP physical
                                          security.
                                         A-32: Provide Executive                   2,539              33             344               7              36
                                          Leadership for SEVP.
                                         A-33: Provide SEVP                        1,599              21             217               4              23
                                          administrative support.
                                         A-34: Develop strategic plan...           1,612              29             305               6              32
                                         A-35: Manage financial                    7,300              95             988              20             105
                                          resources.
                                         A-36: Manage procurement.......           1,886              25             256               5              27
                                         A-37: Manage personnel                    2,065              27             280               6              30
                                          resources.
                                         A-38: Manage SEVP records......           3,274              60             619              12              66
                                         A-39: Manage facility resources           1,782              23             241               5              25
                                         A-40: Manage I-901 payment                7,766  ..............  ..............  ..............  ..............
                                          system.
                                         A-42: Manage I-901 J program...          15,966  ..............  ..............  ..............  ..............
                                         A-44: Site Visits..............  ..............  ..............  ..............             638  ..............
Train SEVP staff, other staff, and DSOs  A-09: Develop and deliver SEVIS           5,936              78             803              16              85
                                          training.                                2,613              48             494              10              52
                                         A-10: Develop and deliver
                                          internal training.
                                                                         -------------------------------------------------------------------------------
    Total..............................  ...............................         314,355           3,902          51,827             775           4,155
--------------------------------------------------------------------------------------------------------------------------------------------------------


[[Page 33775]]

3. Fee Calculations
---------------------------------------------------------------------------

    \10\ SEVP Automated Management System.
---------------------------------------------------------------------------

    The cost model provides detailed cost information by activity and a 
summary cost for each, giving the aggregate fee cost by category. Next, 
SEVP projected the total number of fee payments of each type for FY 
2019 and FY 2020 and determined the fee-recoverable budget. SEVP 
selected a forecasting approach to determine the total number of 
expected fee payments for each fee.
a. I-901 SEVIS Fee
    To calculate a fee amount for the I-901 SEVIS fee, SEVP estimated 
the number of fee payments expected in FY 2019 and FY 2020 for each of 
the three fee payment types: Reduced fee for J participants (excluding 
the additional cost for initial certification and recertification of 
SEVP-certified schools); full fee for J participants (excluding the 
additional cost for initial certification and recertification of SEVP-
certified schools); and full fee for F and M students (including 
additional costs for certification, recertification, and appeals).
    Calculations for each of the three fee payment types vary because 
each fee type is treated differently in federal statutes and 
regulations. Section 641 of IIRIRA exempts Federal Government-sponsored 
J-1 exchange visitors from the fee payment. All F and M nonimmigrant 
students are currently required to pay $200, and nonexempt J 
nonimmigrant exchange visitors currently must pay $180. 8 CFR 
103.7(b)(1)(ii)(H); 214.13(a). Congress modified the statute in 
December of 2000 to establish a reduced fee of $35 for au pairs, camp 
counselors, or participants in a summer work travel program, 
demonstrating strong congressional intent that the fee remain at that 
level. Act of Dec. 21, 2000, Public Law 106-553, app. B, sec. 110, 114 
Stat. 2762, 2762A-51, 2762A-68. IIRIRA also provided for revising the 
fee once the program to collect information was expanded to include 
information collection on all F, M, and J nonimmigrants. As a result, 
the I-901 fee was revised in 2008 under the provisions of IIRIRA to 
take into account the actual cost of carrying out the program. See 73 
FR 55683. The I-901 fee is now being revised a second time, through 
this rule, due to an increase in the actual cost of carrying out the 
program.
    SEVP determined the number of expected I-901 SEVIS fee payments in 
FY 2019 and FY 2020. SEVP calculated the I-901 SEVIS fee over a 2-year 
period to account for potential fluctuation in the forecast. SEVP used 
the change in the numbers of payments received to provide the trend 
data used to forecast I-901 SEVIS fee payments for each I-901 payment 
type separately. Table 8 reflects aggregate historical payment data for 
all three I-901 payment types.

              Table 8--F, M, and J Visa Issuance 2007-2017
------------------------------------------------------------------------
               Fiscal year                     Total       Growth rate*
------------------------------------------------------------------------
2007....................................         697,054  ..............
2008....................................         753,065             8.0
2009....................................         644,912           -14.4
2010....................................         699,983             8.5
2011....................................         749,082             7.0
2012....................................         744,027            -0.7
2013....................................         767,805             3.2
2014....................................         829,636             8.1
2015....................................         885,728             6.8
2016....................................         866,623            -2.2
2017....................................         796,820            -8.1
------------------------------------------------------------------------
* Growth rate rounded to nearest tenth of a percent.

    As indicated in Table 8, the level of payments received varied 
greatly over the past 10 years. This high degree of variation in the 
historical data, combined with the variables affecting demand for 
visas, called for a forecasting methodology that would capture and 
account for deviations.
    SEVP selected a statistical forecasting method that uses trends in 
historical data to forecast future payments. SEVP selected ARIMA, an 
autoregressive integrated moving average model to forecast payments. An 
ARIMA model is a statistical model that uses historical time series 
data to predict future trends and movements. A non-seasonal model 
incorporates two major components: Trend and moving average. The 
autoregressive portion of the model, or trend, states that past values 
have an effect on current or future values and that values are 
estimated based on the weighted sum of past values. The second 
component is moving average which helps to smooth out the time series 
to filter out extreme fluctuations or outliers. In some cases a third 
component is needed: Seasonality. Visa data from 2004 to the present 
shows extreme seasonality in the number of F, M, and J visas issued. 
Seasonality is factored into the model to account for the U.S. academic 
calendar.
    SEVP evaluated alternative forecasting methods; however, SEVP 
rejected these methods due to inaccuracy and poor fit. SEVP's chosen 
model provided a conservative forecast that will allow SEVP to operate 
with stability. The fee payment forecast, reflected in Table 9, places 
a balanced mix of emphasis on recent and historical data and still 
contains sufficient data points to smooth out some variability in the 
underlying data.

        Table 9--I-901 SEVIS Fee Payment Forecast FY 2019-FY 2020
------------------------------------------------------------------------
           I-901 Payment type                 FY 2019         FY 2020
------------------------------------------------------------------------
Full Payments, F/M......................         418,393         407,933
Full payment, J-Full....................         157,550         153,611
Subsidized, J-Partial...................         158,945         158,945
                                         -------------------------------
    Total...............................         734,888         720,490
------------------------------------------------------------------------

b. Certification Cost
    SEVP uses historical data from FY 2012 to FY 2016 to find a 3-year 
moving average to forecast annual new initial certifications. SEVP 
predicts demand of approximately 426 initial certifications each year. 
SEVP assumes that the proposed higher fee will not deter schools from 
applying for certification.

       Table 10--Three-Year Moving Average of the Number of School
                     Certification Payments Received
------------------------------------------------------------------------
                                             Payments      3-Year moving
               Fiscal year                   received         average
------------------------------------------------------------------------
2012....................................             457  ..............
2013....................................             382  ..............

[[Page 33776]]

 
2014....................................             446             428
2015....................................             469             432
2016....................................             363             426
------------------------------------------------------------------------

    The total fee category budget is taken directly from the FY 2019 
and FY 2020 SEVP ABC model, reflected in Table 11.

     Table 11--FY 2019-FY 2020 Certification Fee-Recoverable Budget
------------------------------------------------------------------------
                                           Certification       Fee-
               Fiscal year                   payments       recoverable
                                             expected         budget
------------------------------------------------------------------------
2019....................................             426      $1,909,680
2020....................................             426       1,992,878
                                         -------------------------------
    Total...............................             852       3,902,558
------------------------------------------------------------------------

    School certification fees are calculated by dividing the fee-
recoverable budget by the anticipated number of payments. This results 
in a fee-recoverable amount from schools of $4,580 each. To arrive at 
the proposed fee, rounding was applied to the result of the fee 
algorithm. This results in a certification fee of $4,600 per school. 
Setting the certification fee at the $4,600 figure, however, leads to 
an increase of the current school certification fee by $2,900, 
resulting in a certification fee over twice the current fee amount. 
School certification is integral to SEVP--F and M nonimmigrant students 
can only attend SEVP-certified schools. DHS is concerned that such an 
increase of the school certification fee would appear dramatic to 
schools seeking initial certification and could lead to fewer schools 
seeking initial certification, so DHS proposes to keep the fee increase 
at a level that will not discourage potential new schools from seeking 
certification. At the same time, DHS considers that initial 
certification bestows upon the school a valuable asset, the ability to 
enroll F and M nonimmigrant students, and an increased fee amount is 
reasonable as the initial certification process becomes more extensive 
through the SEVIS modernization and other technological developments. 
Weighing these concerns, DHS decided to subsidize the I-17 
certification fee by increasing the payment by only $1,300 to $3,000. 
The remainder of the costs for I-17 certification is subsidized by the 
I-901 F and M SEVIS fee, which is addressed below.
c. Recertification Cost
    To identify a fee level that would recover the full cost of 
recertification operations, SEVP determined the full cost of 
recertification (including level of effort and contract cost) and the 
approximate number of schools willing to recertify. Because schools are 
required to recertify every 2 years, SEVP anticipates that 
approximately one-half of its certified schools--roughly 4,373 schools 
per year, given the current certified school population of 8,746--would 
recertify.

    Table 12--FY 2019-FY 2020 Recertification Fee-Recoverable Budget
------------------------------------------------------------------------
                                         Recertification       Fee-
              Fiscal year                    payments       recoverable
                                             expected         budget
------------------------------------------------------------------------
2019...................................            4,373     $25,368,650
2020...................................            4,373      26,457,896
                                        --------------------------------
    Total..............................            8,746      51,826,546
------------------------------------------------------------------------

    To calculate an anticipated school recertification fee, DHS divides 
the fee-recoverable budget by the anticipated number of payments. This 
results in a fee-recoverable amount from schools of $6,000 each. To 
arrive at the proposed fee, rounding was applied to the result of the 
fee algorithm. This would result in a recertification fee of $6,000 per 
school. DHS desires to institute a recertification fee to more 
accurately assign the costs of recertification adjudication to those 
stakeholders who are directly requesting the adjudication--the SEVP-
certified schools--particularly since the costs of recertification 
continue to increase as the recertification process becomes more 
robust. DHS considers, however, that a recertification fee instituted 
in this rule for the first time should not be set at a level that could 
discourage schools from seeking recertification. DHS also considers 
that the recertification amount should be less than the initial 
certification amount so that schools are encouraged to seek 
recertification instead of allowing their SEVP certification to be 
withdrawn and applying for initial certification anew at some later 
date. Withdrawal of SEVP-certification not only leads to the school 
losing a valuable asset, but also leads to complications for F and M 
nonimmigrant students enrolled in the withdrawn school, who are then 
forced to transfer schools, leave the United States, or risk facing 
immigration law penalties for violating the terms of their nonimmigrant 
status. Weighing all these factors, DHS proposes that the I-17 
recertification fee be $1,250. DHS proposes to eliminate regulations 
that state that no fee is required for the school recertification 
process in order to recover part of this cost, as part of an effort to 
establish a more equitable distribution of costs and more sustainable 
level of cost recovery relative to services provided. The costs for I-
17 recertification not recovered by the proposed fee would be 
subsidized by the I-901 F and M SEVIS fee. The explanation for shifting 
responsibility of the fee adjustment to the I-901 fee is included 
below.
d. Site Visit Cost
    Site visits consist of initial certification site visits, change of 
location visits, and new campus or location site visits. The 
anticipated workload for these site visits is 600 per year, or 1,200 
visits over a 2-year period.

       Table 13--FY 2019-FY 2020 Site Visit Fee-Recoverable Budget
------------------------------------------------------------------------
                                            Site visit         Fee-
               Fiscal year                   payments       recoverable
                                             expected         budget
------------------------------------------------------------------------
2019....................................             600        $385,674
2020....................................             600         389,689
                                         -------------------------------
    Total...............................           1,200         775,363
------------------------------------------------------------------------

    The current fee amount is $655 as established in the 2008 Fee Rule 
that codified SEVP's authority to charge the fee when a school changes 
its physical location or adds new physical location or campus. 
Following this rule's effective date, SEVP will collect the fee when a 
school adds a new physical location or campus. The site visit fee would 
apply when a certified school updates its Form I-17 in SEVIS to 
indicate, pursuant to 8 CFR 214.3(h)(3)(ii), an added physical location 
or campus. The site visit fee is based on level of effort for both SEVP 
staff and contracts that cover the cost of operations.
e. Appeals and Motions Cost
    Determining the full cost of processing an appeal is essential to 
improving the fee structure. The fee for filing a motion or appeal is 
calculated by determining the workload of appeals and motions over the 
FY 2019 and FY 2020 periods. Over the past 2 years, SEVP has processed 
54 appeals and motions annually. To maintain conservative estimates, 
SEVP anticipates that number will remain constant over the FY 2019 and 
FY 2020 periods.

[[Page 33777]]



        Table 14--FY 2019-FY 2020 Appeals Fee-Recoverable Budget
------------------------------------------------------------------------
                                            Appeal and
                                              motion           Fee-
               Fiscal year                   payments       recoverable
                                             expected         budget
------------------------------------------------------------------------
2019....................................              54      $1,956,375
2020....................................              54       2,198,825
                                         -------------------------------
    Total...............................             108       4,155,200
------------------------------------------------------------------------

    Fees for motions or appeals are calculated by dividing the fee-
recoverable budget by the anticipated number of payments over the FY 
2019 and FY 2020 periods. This results in a fee-recoverable amount of 
$38,474 for each appeal. To arrive at the proposed final cost, rounding 
was applied to the result of the fee algorithm. This results in a cost 
for a motion or appeal of $38,500. SEVP believes that this fee, while 
justified, is too high to impose on the affected schools as the first 
fee to be established and collected for the subject appeals and 
motions, and that some accommodation should be made to keep the fee at 
a more reasonable amount. Instead, DHS proposes adding $4.76 to the 
Form I-901 F and M fees to counterbalance the unfunded costs of 
adjudicating appeals and motions. This will better ensure that cost is 
not a significant obstacle in pursuing an administrative appeal or 
motion. The Form I-290B fee when filed with SEVP would be set at $675, 
which is currently the same amount charged when the form is filed with 
USCIS. See 8 CFR 103.7(b)(i)(S).\11\ The Form I-290B, ``Notice of 
Appeal or Motion,'' filed with USCIS is the same form used for appeals 
or motions related to any denial of school certification or 
recertification or a withdrawal of such certification. Although the 
appeal fee would not be set at the amount necessary to recover the full 
costs of appeals and motions, by setting a fee of $675, schools that 
benefit from the appeal process would bear some of its costs, and DHS 
would more fairly balance allocation of the recovery of SEVP 
operational costs between beneficiary classes. As proposed, DHS would 
charge the fee for all such appeals and motions.
---------------------------------------------------------------------------

    \11\ Because the underlying rationale for the amount of the I-
290B fee differs between SEVP and USCIS, the cost for appealing a 
claim or petition using the I-290B Form could eventually be 
different for SEVP and USCIS 8 CFR 103.7(b)(1)(i)(S).
---------------------------------------------------------------------------

4. Proposed Fee Levels
    Viewing the SEVP fee structure and affected parties 
comprehensively, DHS proposes to adjust each fee in its fee structure 
based not only on cost of services, but also on the desire to spread 
the impact of fee increases reasonably among the various beneficiaries 
of SEVP services. Despite the ABC calculations' determination of the 
actual cost of each service, which is represented by each fee, DHS has 
determined that using the I-901 revenue to subsidize the costs of the 
SEVP's other fees is an appropriate course of action for two reasons. 
First, the number of F and M students paying the I-901 fee is 
substantially larger than the number of entities paying each of the 
school certification-related fees, allowing for SEVP to lessen the 
impact of fee increases in the aggregate. Second, the subsidization is 
reasonable because individuals paying the I-901 fee necessarily benefit 
from the continued certification of schools for their enrollment and 
prompt and accurate adjudication of appeals.
    DHS proposes to increase the I-901 SEVIS fee for F and M students 
from $200 to $350 and the full I-901 SEVIS fee for most J exchange 
visitors from $180 to $220. While these increases may seem large, these 
fees have been unchanged since 2008. 73 FR 55683 (Sept. 26, 2008). In 
2008, the first time these fees had been updated since SEVP's inception 
in 2004, the I-901 SEVIS fee for F and M students increased from $100 
to $200, and the full I-901 SEVIS fee for most J exchange visitors 
increased from $100 to $180. See id. The I-901 SEVIS fee for special J-
visa categories (au pair, camp counselor, and summer work travel) would 
remain at the current $35 level, consistent with the levels set by 
Congress in 8 U.S.C. 1372(e)(4)(A). IIRIRA also exempts from the I-901 
SEVIS fee J-1 exchange visitors who participate in Federal Government-
sponsored J-1 exchange programs, consistent with 8 U.S.C. 1372(e)(3).
    DHS proposes to increase the initial certification fee from $1,700 
to $3,000. This fee was originally set at $230, effective in 2002, 
prior to the reorganization of the Immigration and Naturalization 
Service (INS) to become part of DHS. See 66 FR 65811 (Dec. 21, 2001). 
The fee was increased in 2008 to $1,700. See 73 FR 55683. This is the 
base fee for certification and does not include the site visit fee.
    DHS proposes to establish a recertification fee at $1,250, maintain 
the site visit fee of $655, and set the I-290B fee at $675. The cost 
for SEVP recertification, site visits, and motions and appeals 
adjudication is determined by employing ABC principles, previously 
described in this document, balanced with SEVP's desire to prevent 
recertifications, site visits, appeals, and motions filings from 
becoming cost prohibitive. DHS is proposing a recertification fee and a 
Form I-290B fee for the first time, and SEVP believes that charging 
recertification and appeals fees sufficient to recover, on their own, 
the fee-recoverable amount for such services, may result in 
inordinately high fees from the perspective of entities who have 
regularly received the benefits of these SEVP services at no additional 
charge. Accordingly, DHS proposes to set these fees at amounts below 
the fee-recoverable cost. For the I-290B fee in particular, DHS 
proposes to set the amount at $675. DHS believes this amount is 
appropriate because it is less than both the fee for initial 
certification and the fee for recertification. Further, the amount $675 
is already associated with the Form I-290B when filing it with USCIS. 
DHS believes $675 is a logical starting point, because this is the fee 
currently being charged by USCIS for motions and appeals. While the 
difference between the fee-recoverable amount (approximately $38,500) 
and the proposed fee of $675 is substantial, subsidizing this fee by 
driving the additional costs to the I-901 fee results in an increase of 
only $4.76 to F/M students paying that fee. The proposed program fee 
schedule for SEVP beginning in FY 2019 is shown in Table 15.

                  Table 15--Proposed FY 2019 SEVP Fees
------------------------------------------------------------------------
                        Category                              Amount
------------------------------------------------------------------------
I-901 SEVIS Fees:                                         ..............
     I-901 Primary F/M visa holders (Full)......            $350
     I-901 Primary J visa holders (Full)........             220
     I-901 Special J-visa categories (Subsidized              35
     payment)...........................................
I-17 School Fee:                                          ..............

[[Page 33778]]

 
     Certification Fee..........................           3,000
     Recertification Fee........................           1,250
     Site visit fee for initial certification                655
     (base fee to be multiplied by number of locations
     cited on the Form I-17), and for new physical
     locations..........................................
Appeal or Motion Fee:                                     ..............
     Appeal or Motion Fee.......................             675
------------------------------------------------------------------------

    These proposed fee amounts, the cost model outputs, and cost 
reallocation amounts are shown in Table 16. The cost reallocation 
amounts are negative for the fees that are subsidized. The cost 
reallocation amounts that are positive are the amounts per fee that 
subsidize the other fee categories.

                                                        Table 16--Proposed Fee Adjustment Amounts
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                          Activity based
                           Fee                             Current fee      cost model         Cost         Final fee     Change in fees    % Change in
                                                                              output       reallocation                                        fee
                                                                     (a)             (b)             (c)     (d = b + c)             (e)  (f = (d/a) -1)
--------------------------------------------------------------------------------------------------------------------------------------------------------
Appeal or Motion Fee: I-290B............................             N/A         $38,475       ($37,800)            $675            $675             N/A
I-901 F/M...............................................             200             290              60             350             150              75
I-901 J-Full............................................             180             123              97             220              30              22
I-901 J-Partial.........................................              35             123            (88)              35               0               0
I-17 Initial Certification..............................           1,700           4,600         (1,600)           3,000           1,300              76
I-17 Recertification....................................             N/A           6,000         (4,750)           1,250           1,250             N/A
Site Visit--initial.....................................             655             650               5             655               0               0
Site Visit--new location................................               0             650               5             655             655             N/A
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Table 17 reflects the break-even analysis based on the proposed fee 
schedule and the proportional fee volumes (rounded) required to 
generate sufficient revenue to offset projected program costs.

                                Table 17--Projected Revenue--FY 2019 and FY 2020
----------------------------------------------------------------------------------------------------------------
                                                                   Proposed fee     Forecasted      Forecasted
                          Fee category                                amount          volume          revenue
----------------------------------------------------------------------------------------------------------------
I-901 F/M Full..................................................            $350         826,326    $289,214,144
I-901 J-Full....................................................             210         311,162      68,455,584
I-901 J-Partial.................................................              35         317,890      11,126,150
I-901 Subtotal:
    Certification Fee...........................................           3,000             852       2,556,000
    Recertification Fee.........................................           1,250           8,746      10,932,500
    Site Visit..................................................             655           1,200         786,000
I-17 Subtotal:
    Appeals.....................................................             675             108          72,900
        Total...................................................  ..............       1,466,284     383,143,278
----------------------------------------------------------------------------------------------------------------

VI. Statutory and Regulatory Requirements

A. Executive Orders 12866, 13563, and 13771: Regulatory Review

    Executive Orders 12866 (``Regulatory Planning and Review'') and 
13563 (``Improving Regulation and Regulatory Review'') direct agencies 
to assess the costs and benefits of available regulatory alternatives 
and, if regulation is necessary, to select regulatory approaches that 
maximize net benefits (including potential economic, environmental, 
public health, and safety effects; distributive impacts; and equity). 
Executive Order 13563 emphasizes the importance of quantifying both 
costs and benefits, reducing costs, harmonizing rules, and promoting 
flexibility. Executive Order 13771 (``Reducing Regulation and 
Controlling Regulatory Costs'') directs agencies to reduce regulation 
and control regulatory costs and provides that ``for every one new 
regulation issued, at least two prior regulations be identified for 
elimination, and that the cost of planned regulations be prudently 
managed and controlled through a budgeting process.''
    The Office of Management and Budget (OMB) has designated this rule 
a ``significant regulatory action,'' although not economically 
significant under section 3(f) of Executive Order 12866. Accordingly, 
the rule has been reviewed by OMB. This proposed rule would impose 
transfer payments between the public and the government. Thus, this 
proposed rule is not expected to be subject to the requirements of 
Executive Order 13771. An initial regulatory analysis follows.
1. Background and Purpose of the Proposed Rule
    SEVP is a fee funded program within ICE that provides oversight of 
schools and nonimmigrant students in the F and M visa category. SEVP 
uses SEVIS to

[[Page 33779]]

monitor and track certified schools and F, M, and J nonimmigrant 
students. DoS also uses SEVIS in the management of the Exchange Visitor 
Program for nonimmigrant exchange visitors in the J visa category. 
SEVIS is a web-based system administered by SEVP that retains data on 
international students and exchange visitors in the country. SEVP uses 
SEVIS to ensure accurate reporting and recordkeeping by schools and 
exchange visitor programs. SEVP also uses SEVIS to identify for 
enforcement action student and exchange visitors who are out of status.
    The purpose of this proposed rule is to generate the necessary 
revenue to recover the full cost of the FY 2019 and FY 2020 budgets. 
SEVP is authorized to recover the full cost of all resources and 
services provided. The costs of SEVP activities have increased, and the 
fees collected no longer cover the costs. The fee increase is needed to 
meet long-term cash flow needs and achieve solvency.
    SEVP projects an annual budget of $186.6 million in FY 2019 and 
$188.4 million in FY 2020. SEVP forecasts $121.6 million in revenue for 
FY 2019 and FY 2020 without a fee change. The implementation of this 
proposed rule would provide SEVP with additional fee revenue of $75.2 
million in FY 2019 and $73.5 million in FY 2020. If DHS does not adjust 
the current fees to recover the costs of processing the enrollment of F 
and M students, certification and recertification of schools, 
processing relating to J exchange visitors, appeals, and site visits, 
it will be forced to make reductions in oversight, security, and 
service as compared to current projections.
    To determine the full cost associated with SEVP and the management 
of SEVIS, SEVP used ABC methodology. ABC first identifies activities in 
an organization and then assigns the cost of each activity according to 
the resources they consume. SEVP identified the following as its 
primary activities: Collecting and retaining information on F, M, and J 
nonimmigrants; certifying schools; overseeing school compliance; 
recertifying schools; adjudicating appeals; investigating suspected 
violations of immigration law and other potential threats to national 
security by F, M, or J nonimmigrants; providing outreach and education 
to users; and performing regulatory and policy analysis. SEVP also 
recognizes management and overhead costs associated with the program.
    SEVP proposes five fees paid by two source categories: Individuals 
will pay the I-901 SEVIS fee, and institutions will pay the I-17 
certification fee, I-17 recertification fee, the fee for a motion or 
appeal, and the site visit fee. By tracing expenditures of the 
activities previously listed to the various fee categories, SEVP 
forecasted fee payments to determine the appropriate fee amount for 
each fee type proposed in this rule.
    Table 18 presents an accounting statement summarizing the 
annualized transfer amounts and qualitative benefits of the proposed 
rule. This rule proposes that schools will pay a higher fee for initial 
SEVP certification and will incur a fee for recertification, a site 
visit when adding a new physical location or campus, and the filing of 
a motion or appeal. In addition, F and M students and J visitors will 
pay higher fees.

                                   Table 18--Accounting Statement for FY 2019
----------------------------------------------------------------------------------------------------------------
                     Category                                             Primary estimate
----------------------------------------------------------------------------------------------------------------
Qualitative Benefits.............................  SEVP will be able to maintain the current level of service.
                                                    This proposed rule will enhance SEVP's capability to support
                                                    national security and counter immigration fraud through the
                                                    continued development and implementation of critical system
                                                    and programmatic enhancements. Enhancements to SEVIS,
                                                    including the establishment of a student portal, will assist
                                                    DSOs in their regulatory obligation to provide accurate and
                                                    timely information and rebalance this reporting requirement
                                                    by providing students an automated means to do so. Increased
                                                    adjudication personnel will assist in reducing
                                                    recertification processing times, while enhanced vetting
                                                    protocols will ensure that only those eligible to enter and
                                                    remain in the country do so
Transfers........................................  7% Discount Rate $75,231,420 from schools and students to the
                                                    government
                                                   3% Discount Rate $75,231,420 from schools and students to the
                                                    government
----------------------------------------------------------------------------------------------------------------


 
               Category                                    Effects                               Source
----------------------------------------------------------------------------------------------------------------
Effects on State, local, and/or tribal  The proposed rule would increase and           NPRM, Executive Order
 government.                             establish additional fees on state, local,     12866 analysis
                                         and/or tribal government-funded educational
                                         institutions for support of SEVP operations.
                                         This rule proposes to increase the I-17
                                         certification fee and creates the I-17
                                         recertification fee and a fee for filing an
                                         appeal or motion. In addition, this rule
                                         announces that following completion of this
                                         rulemaking, SEVP will collect a site visit
                                         fee when an SEVP-certified school adds a
                                         campus/location.
Effects on small businesses...........  The proposed rule would increase and           Initial Regulatory
                                         establish additional fees for educational      Flexibility Analysis
                                         institutions in support of SEVP operations.
                                         This proposed rule would increase the I-17
                                         certification fee and create the I-17
                                         recertification fee and a fee for filing an
                                         appeal or motion. In addition, this rule
                                         announces that following the completion of
                                         this rulemaking, SEVP will collect a site
                                         visit fee when a school certified by SEVP
                                         adds a campus/location.
----------------------------------------------------------------------------------------------------------------

2. Impacts of Regulatory Change
    This proposed rule would amend the current fees for the individual 
student and exchange visitor application fee (I-901 SEVIS fee) and 
school certification petition for initial certification. It would 
maintain the current fee for site visits and extend it to any change of 
location or additional physical location or campus reported as an 
update by a certified school. It would also institute a new fee for 
school recertification petitions and the filing of appeals and motions 
by schools. The amended fee structure reflects existing and projected 
operating costs, program requirements, and planned program 
improvements.
    The current I-901 SEVIS fees are based on a fee analysis performed 
when SEVP last increased the fees in 2008. See 73 FR 55683. Those cost 
calculations were established on the basis of projected workload. Since 
2008,

[[Page 33780]]

SEVP's program mission tasks have expanded significantly. The 
expansions of certification, recertification, and appeals costs and the 
subsidization of excess costs not recovered by fees have led to the 
need for the proposed fee increase. Additionally, SEVP now provides 
investigative analysis to support enforcement operations, has increased 
numbers of adjudication personnel, and is undergoing SEVIS 
Modernization. Concurrently, costs associated with these program tasks 
have been affected by increased costs due to inflation. This rule 
proposes fees that would result in recovery of the full cost of SEVP 
operations with fee-generated revenue; alignment of the fees with 
current and projected costs and processes that have been adjusted as 
the program has gained experience and sophistication; and the agency's 
adoption of more detailed and accurate data sources and improved 
management tools to align resources and workload.
a. I-901 F and M SEVIS Fee
    F nonimmigrants, as defined in INA section 101(a)(15)(F), 8 U.S.C. 
1101(a)(15)(F), are foreign students who come to the United States to 
pursue a full course of academic study in SEVP-approved schools and 
their dependents. M nonimmigrants, as defined in INA section 
101(a)(15)(M), 8 U.S.C.1101(a)(15)(M), are foreign nationals pursuing a 
full course of study at an SEVP-certified vocational or other 
recognized nonacademic program (other than language training programs) 
in the United States and their dependents. International F and M 
nonimmigrant students seeking temporary admission into the United 
States to attend a U.S. educational institution must pay the I-901 F 
and M SEVIS fee. SEVP proposes to increase the I-901 F and M SEVIS fee 
from $200 to $350.
    From 2007 through 2017, SEVP received an average of 450,581 I-901 F 
and M SEVIS payments per year. Table 19 shows the volume of I-901 F and 
M SEVIS fee payments received and the annual average number of fee 
payments from 2007 to 2017. As previously discussed, SEVP has 
forecasted 418,393 I-901 F and M payments in FY 2019 and 407,933 FY 
2020, respectively.

        Table 19--1-901 F and M SEVIS Fee Payments FYs 2010-2017
------------------------------------------------------------------------
                       Fiscal year                         Fee payments
------------------------------------------------------------------------
2007....................................................         358,666
2008....................................................         400,090
2009....................................................         348,815
2010....................................................         389,255
2011....................................................         431,180
2012....................................................         449,029
2013....................................................         469,986
2014....................................................         519,751
2015....................................................         574,158
2016....................................................         545,203
2017....................................................         470,261
Annual Average (2007-2017)..............................         450,581
Forecasted 2019.........................................         418,393
Forecasted 2020.........................................         407,933
------------------------------------------------------------------------

    Table 20 illustrates the incremental increase DHS is proposing with 
this rule for the I-901 F and M fee. Individuals who submit a Form I-
901 will pay an additional $150 under this proposed rule, which is a 75 
percent increase.

                                Table 20--I-901 F and M Incremental Fee Increase
----------------------------------------------------------------------------------------------------------------
                                                                                                    Difference
                              Type                                  Current fee    Proposed fee     (proposed-
                                                                                                     current)
----------------------------------------------------------------------------------------------------------------
I-901 F and M...................................................            $200            $350            $150
----------------------------------------------------------------------------------------------------------------

    SEVP estimates that the fee increase would result in an annual 
increase of transfer payment from students who submit an I-901 form to 
the government of approximately $62 million per year ($150 increase x 
418,393 FY 2019 number of applicants = $62,758,950; $150 increase x 
407,933 FY2020 number of applicants = $61,189,950).
b. I-901 J-Full SEVIS Fee
    DoS generally oversees the exchange visitor program, which includes 
nonimmigrants who are charged the full J SEVIS fee. J exchange visitors 
are nonimmigrant individuals approved to participate in an exchange 
visitor program in the United States and the spouse and dependents of 
the exchange visitors. This SEVIS fee is associated with J-1 
nonimmigrants participating in a designated exchange visitor program. 
Certain other J-1 categories are subject to a reduced fee or are exempt 
from a fee in accordance with 8 U.S.C. 1372(e). SEVP and DoS have a 
memorandum of reimbursable agreement. DoS sends SEVP its actual 
expenditures, and SEVP reimburses them quarterly. Each year, SEVP and 
DoS review and update the memorandum. Table 21 displays the affected 
Exchange Visitor Program categories subject to the full SEVIS fee and 
the purpose of the visit.\12\
---------------------------------------------------------------------------

    \12\ See Department of State, Exchange Visitor Program Category 
Requirements (June 2016), available at https://j1visa.state.gov/wp-content/uploads/2017/06/Exchange-Visitor-Program-Category-Requirements.pdf (last visited Feb. 26, 2018).

 Table 21--J-1 Exchange Visitor Program Categories Subject to Full SEVIS
                                   Fee
------------------------------------------------------------------------
 Exchange visitor program category            Purpose of visit
------------------------------------------------------------------------
Short-term Scholar................  Lecture, observe, consult, training,
                                     demonstrate special skills.
Professor and Research Scholar....  Research Scholar: Research, observe,
                                     or consult in connection with a
                                     research project.
                                    Professor: Teach or lecture at
                                     university, observe, or consult.
Physician.........................  Pursue graduate medical education or
                                     training at accredited schools of
                                     medicine or scientific
                                     institutions.
Intern............................  Structured internship program that
                                     is in the student's field of study.
Trainee...........................  Structured training program that is
                                     in the trainee's professional
                                     field.
Specialist........................  Observing, consulting, or
                                     demonstrating special skills.
Teacher...........................  Teach full-time in an accredited
                                     primary, including pre-
                                     kindergarten, or secondary (K-12)
                                     public or private school.

[[Page 33781]]

 
Secondary School Student..........  Study in the U.S. at accredited
                                     public or private secondary schools
                                     for an academic semester or an
                                     academic year, while living with
                                     American host families.
College and University Student....  Participate in a degree or nondegree
                                     program at an accredited
                                     postsecondary academic institution,
                                     or participate in a student
                                     internship program.
Government visitor (non-Federal)..  Engage in observation tours,
                                     discussions, consultations,
                                     professional meetings, conferences,
                                     workshops and travel when selected
                                     by a state or local government
                                     agency.
------------------------------------------------------------------------

    SEVP receives an average of 151,958 I-901 Full J SEVIS payments per 
year (FYs 2007-2017). Table 22 displays the volume of Full I-901 J 
SEVIS fee payments received and the annual average number of fee 
payments. SEVP has forecasted 157,550 I-901 J-Full payments in FY 2019 
and 153,611 in FY 2020.

         Table 22--I-901 J-Full SEVIS Fee Payments FYs 2010-2017
------------------------------------------------------------------------
                       Fiscal year                         Fee payments
------------------------------------------------------------------------
2007....................................................         132,213
2008....................................................         137,173
2009....................................................         129,979
2010....................................................         139,534
2011....................................................         148,253
2012....................................................         155,008
2013....................................................         160,522
2014....................................................         172,530
2015....................................................         168,967
2016....................................................         164,401
2017....................................................         162,959
Average (2007-2017).....................................         151,958
Forecasted 2019.........................................         157,550
Forecasted 2020.........................................         153,611
------------------------------------------------------------------------

    The difference between the proposed and current fees for the I-901 
J-Full applicants is $40, an increase of approximately 22 percent, as 
shown in Table 23.

                                     Table 23--I-901 J-Full Incremental Fee
----------------------------------------------------------------------------------------------------------------
                                                                                                    Difference
                             Type                                Current fee      Proposed fee      (proposed-
                                                                                                     current)
----------------------------------------------------------------------------------------------------------------
I-901 J-Full.................................................            $180             $220              $40
----------------------------------------------------------------------------------------------------------------

    The total increase in transfer payments from I-901 J-Full 
applicants to the government is expected to be $12,446,440 ($40 
increase in fee x 157,550 FY 2019 and 153,611 FY 2020 forecasted number 
of applicants). The increase in J fees is meant to recover the full 
cost of J program operations for SEVP, which includes the reimbursement 
to DoS, SEVIS costs, and other adjudication services for J exchange 
visitors. For the purposes of calculating fees, SEVP isolates the costs 
specifically incurred by operating the J visa program. As it stands, 
the J visa program operates at a greater cost than the revenue that J 
visa fees bring to the program; therefore, SEVP proposes an increase to 
the J-Full visa to cover the $39.4 million full cost of operating the J 
visa program on an annual basis.
c. I-17 Certification and Recertification Fee
    For a U.S. school to enroll F and M nonimmigrant students, it is 
required to be certified by SEVP. A school petitions for SEVP 
certification to enroll these students by completing and submitting 
Form I-17, ``Petition for Approval of School for Attendance by 
Nonimmigrant Student,'' online through SEVIS.
    All SEVP-certified schools are required to go through the 
recertification process every 2 years to ensure they remain qualified 
for certification and adhere to all requirements according to the 
regulations.
    From FY 2012 to 2016, there has been an annual average of 423 
schools applying for SEVP certification. As previously discussed, DHS 
calculated the 3-year moving average to minimize the variation in 
forecasting the population data. The I-17 Initial certifications from 
FYs 2012 through 2016 are shown in Table 24.

           Table 24--FYs 2012-2016 I-17 Initial Certifications
------------------------------------------------------------------------
                                               I-17
               Fiscal year                 certification   3-Year moving
                                             petitions        average
------------------------------------------------------------------------
2012....................................             457  ..............
2013....................................             382  ..............
2014....................................             446             428
2015....................................             469             432
2016....................................             363             426
                                         -------------------------------
    Total...............................           2,117  ..............
------------------------------------------------------------------------

    SEVP uses the 3-year moving average to predict that there will be 
426 initial certifications in both FY 2019 and FY 2020, respectively.
    There are currently 8,746 SEVP-certified schools. DHS assumes that 
approximately half, or approximately 4,373 schools, will recertify each 
year, including the 1,728 schools with no active F or M students. DHS 
assumes that a school would prefer to recertify for a $1,250 fee 
instead of allowing certification to lapse and thereafter having to 
again pay the proposed initial certification fee of $3,000. The 
proposed initial certification fee is a 76 percent increase from the 
current fee.
    The current fee to apply for initial certification is $1,700, which 
has not changed since 2008. SEVP does not currently charge a 
recertification fee; the proposed fee amount is $1,250. The I-17 
initial certification and I-17 recertification incremental fees are 
shown in Table 25.

[[Page 33782]]



                                         Table 25--I-17 Incremental Fees
----------------------------------------------------------------------------------------------------------------
                                                                                                    Difference
                              Type                                 Proposed fee     Current fee     (proposed-
                                                                                                     current)
----------------------------------------------------------------------------------------------------------------
I-17 Initial Certification Fee..................................          $3,000          $1,700          $1,300
I-17 Recertification Fee........................................           1,250               0           1,250
----------------------------------------------------------------------------------------------------------------

    The annual increase in transfer payments from schools to the 
government from I-17 initial certifications is expected to be $553,800 
($1,300 increase in fee x 426 (FY 19 and FY 20 forecasted number of I-
17 initial certifications)). The annual increase in transfer payments 
from schools to the government for I-17 recertification is expected to 
be $5,466,250 ($1,250 increase in fee x 4,373 (FY 2019 and FY 2020 
forecasted number of recertifications)).
d. Fee for Motion or Appeal
    When a school is denied certification or recertification, the 
school receives a denial letter through certified mail. The denial 
letter explains the reason for the denial and the steps to appeal. The 
school can appeal by completing the Form I-290B, ``Notice of Appeal or 
Motion,'' within 30 days of receipt. This rule proposes that SEVP 
impose a filing fee of $675, which is also the fee currently charged by 
USCIS upon submission of the Form I-290B.\13\ SEVP does not currently 
collect a fee from a school that files a motion or appeal. DHS proposes 
to revise its regulations to institute this fee for a school filing a 
motion or an appeal in order to establish a more equitable distribution 
of costs, improve services by decreasing an appeals or motions 
throughput time and a more sustainable level of cost recovery relative 
to the services provided.
---------------------------------------------------------------------------

    \13\ USCIS I-290B, ``Notice of Appeal or Motion,'' Filing Fee of 
$675, https://www.uscis.gov/i-290b.
---------------------------------------------------------------------------

    SEVP processed an average of 54 motions and appeals from schools 
annually from 2013 to 2016. DHS assumes that there will be the same 
number of appeals or motions filed in FY 2019 and FY 2020.
    The total annual increase in transfer payments from schools to the 
government for filing a motion or appeal is expected to be $36,450 
($675 fee x 54 (FY 2019 and FY 2020 forecasted number of fee 
payments)).
e. Site Visit Fee
    As noted above, current regulations provide authority for SEVP to 
charge a site visit fee to schools that apply for initial certification 
or report a change of physical location, or addition of a physical 
location or campus. The site visit allows SEVP an opportunity to gather 
evidence on the school's eligibility, review school facilities, and 
interview personnel listed on the I-17 petition as a PDSO or DSO. SEVP 
currently collects the $655 fee when a school files a petition for 
certification to issue Forms I-20 or by a certified school when it 
physically moves to a new location. This proposed rule notifies the 
public that following completion of this rulemaking, SEVP plans to also 
collect the fee from any certified school that adds a physical location 
or campus, by updating its Form I-17 in SEVIS, consistent with the 
above authorities and the agency's longstanding interpretation.
    SEVP performs 600 site visits annually. Of these 600 visits, 426 
will be at schools that apply for initial certification and currently 
pay the $655 site visit fee. The remaining 174 site visits may include 
visits when a school adds a new physical location or campus. DHS 
proposes that the site visit fee amount, $655, remain the same.
    The annual increase in transfer payments from schools to the 
government due to site visits is expected to be $113,970 ($655 fee x 
174 (FY 2019 and FY 2020 forecasted number of site visits)).
f. Conclusion
    SEVP expects to have a total increase in fees of $68.7 million per 
year, discounted at 7 percent, transferred from individuals and 
entities for the services they receive, to the government. Table 26 
shows the summary of the total annual number of payments, incremental 
fee amounts, and total fees transferred.

                           Table 26--Annual Proposed Incremental Fee Amounts, FY 2019
----------------------------------------------------------------------------------------------------------------
                                                                                     Proposed       Annual fee
                                                                   Annual number    incremental     transfer to
                                                                    of payments     fee amounts     government
----------------------------------------------------------------------------------------------------------------
I-901 F and M...................................................         418,393            $150     $62,758,950
I-901 J-Full....................................................         157,550              40       6,302,000
I-17 Initial Certification......................................             426           1,300         553,800
I-17 Recertification............................................           4,373           1,250       5,466,250
Site Visits--initial............................................             426               0               0
Site Visits--new location.......................................             174             655         113,970
Appeals.........................................................              54             675          36,450
                                                                 -----------------------------------------------
    Total.......................................................  ..............  ..............      75,231,420
----------------------------------------------------------------------------------------------------------------

3. Alternatives
    SEVP examined several alternatives to the proposed fee structure, 
including no increase to any fee, only increasing the I-901 SEVIS fee 
and I-17 fee, and the unsubsidized results of the ABC model.
    Without an increase in fees, SEVP will be unable to maintain the 
level of service for students and schools that it currently provides as 
well as the compliance and national security activities discussed 
above. SEVP considered the alternative of maintaining fees at the 
current level but with reduced services and increased

[[Page 33783]]

processing times, but has decided that this would not be in the best 
interest of applicants and schools. SEVP seeks to minimize the impact 
on all parties, but in particular small entities. If SEVP followed this 
alternative scenario, there would be a shortfall of revenue of over 
$65.4 million in FY 2019 to cover expenses. SEVP rejected this 
alternative. SEVP must pay for the expenses of maintaining and 
improving SEVIS and adjudicating schools applying to be certified by 
SEVP in a timely manner.
    SEVP also considered raising only the I-901 and I-17 certification 
fees instead of including a new proposed fee for recertification and 
for filing a motion or appeal. If SEVP followed this scenario, the I-
901 F and M fee would increase to $350 to cover the shortfall in 
revenue, but the I-17 Initial Certification fee would also increase to 
$4,200. This would triple the existing certification fee while allowing 
schools with zero foreign students to remain active SEVP schools that 
require SEVP effort for recertification. SEVP rejected this fee 
structure as it would continue to add workload to SEVP's 
recertification branch. Without any disincentive to recertify, the list 
of schools recertifying would likely continue to grow. The proposed 
fees, however, would establish a more equitable distribution of costs 
and a more sustainable level of cost recovery relative to the services 
provided.
    SEVP also considered the unsubsidized results of the ABC model as 
an alternative, which allocated the I-901 F and M fee, school 
certification fees, and the fee to file an appeal or motion as shown in 
Table 27.

                   Table 27--Unsubsidized Fee Amounts
------------------------------------------------------------------------
                                                           Unsubsidized
                        Fee type                            fee amounts
------------------------------------------------------------------------
I-901 F and M...........................................            $290
I-901 J-Full............................................             130
I-901 J-Partial.........................................             130
I-17 Initial Certification..............................           4,600
I-17 Recertification....................................           6,000
Appeal or Motion........................................          38,475
Site Visit..............................................             650
------------------------------------------------------------------------

    SEVP rejected this alternative for several reasons. Most 
conspicuously, the fee to file a motion or appeal filed on the USCIS-
managed Form I-290B has been set at $675. Since a fee of $38,475 would 
be significantly higher than any other SEVP fee it may improperly 
discourage schools from filing a motion or appeal. Similarly, SEVP 
rejected the alternative to set the recertification fee at the ABC 
model output amount of $6,000. A recertification fee higher than the 
initial certification fee would discourage schools from seeking 
recertification. SEVP instead proposes to set the recertification fee 
at a level is less than the initial certification fee. When schools can 
maintain their certification, F and M nonimmigrant students enrolled in 
the withdrawn school avoid complications such as being forced to 
transfer schools, leave the United States, or risk facing immigration 
law penalties for violating the terms of their nonimmigrant status.
    SEVP also rejected the initial certification fee of $4,600 because 
it finds that an increase of almost three times the current fee of 
$1,700 is excessive. In the fee development, DHS balanced the challenge 
of minimizing the costs to schools and students while recovering 
funding to support SEVP services. The population of I-901 F and M 
students relative to the population of I-17 schools allows for a 
minimal fee adjustment to be spread over the student population to 
reduce the cost burden on individual institutions seeking 
recertification.

B. Regulatory Flexibility Act

Initial Regulatory Flexibility Analysis
    The Regulatory Flexibility Act (RFA) at 5 U.S.C. 603 requires DHS 
to consider the economic impact its proposed rules will have on small 
entities. In accordance with the RFA, DHS has prepared an Initial 
Regulatory Flexibility Analysis (IRFA) that examines the impacts of the 
proposed rule on small entities. The term ``small entities'' 
encompasses small businesses, not-for-profit organizations that are 
independently owned and operated and are not dominant in their fields, 
and governmental jurisdictions with populations of fewer than 50,000.
    DHS requests information and data from the public that would assist 
in better understanding the impact of this proposed rule on small 
entities. DHS also seeks alternatives that will accomplish the same 
objectives and minimize the proposed rule's economic impact on small 
entities.
1. A Description of the Reasons Why the Action by the Agency Is Being 
Considered
    DHS proposes this rule to adjust current fees and introduce new 
fees to ensure that SEVP is able to recover the full costs of the 
management and support of its program activities. DHS's objectives and 
legal authority for this proposed rule are further discussed throughout 
this notice of proposed rulemaking (NPRM).
2. A Succinct Statement of the Objectives of, and Legal Basis for, the 
Proposed Rule
    The objective of the proposed rule is to prevent an anticipated 
funding deficit in operating the SEVP. More specifically, this proposed 
rule would increase the SEVP funding stream by adjusting the I-901 F 
and M fee, I-901 J-Full fee, and I-17 Certification fee and instituting 
the I-17 Recertification fee and a fee for filing a motion or appeal. 
This proposed rule would also announce the collection of a site visit 
fee when an SEVP-certified school adds a new physical location or 
campus, at which it provides educational services to nonimmigrant 
students. The funding supports continuing operations and new 
initiatives critical to SEVP oversight of schools and the monitoring of 
nonimmigrant students in the F, M, and J visa classifications for 
national security purposes.
    The legal basis for this proposed rule increasing the SEVP funding 
stream is grounded in the Homeland Security Act of 2002, which created 
DHS and imparted upon DHS the responsibility for SEVIS. DHS uses SEVIS 
to meet the monitoring and verification requirements under EBSVERA, 
Public Law 107-173, secs. 501-502, 116 Stat. 543, 560-63 (2002) 
(codified at 8 U.S.C. 1761-1762), and to conduct a recertification of 
schools every 2 years following the date of EBSVERA's enactment. The 
Secretary of Homeland Security is authorized to collect fees for SEVP 
from prospective F and M students and J exchange visitors. IIRIRA 
section 641(e)(1), as amended, 8 U.S.C. 1372(e)(1). Initially, fees for 
most groups of F, M, and J classes of prospective nonimmigrants were 
statutorily limited to not exceed $100, except in the case of the fee 
for special J visa categories--au pairs, camp counselors, and 
participants in summer work travel programs--which was set at $35 
pursuant to 8 U.S.C. 1372(e)(4)(A). This fee level has been maintained 
consistent with Congressional intent. The Secretary is authorized to 
revise nonimmigrant fees on a periodic basis to account for changes in 
the cost of executing SEVP. IIRIRA section 641(g)(2), 8 U.S.C. 
1372(g)(2). In addition, INA section 286(m), 8 U.S.C. 1356(m), provides 
that DHS may set fees ``at a level that will ensure recovery of the 
full costs of providing [adjudication] services.''

[[Page 33784]]

3. A Description--and, Where Feasible, an Estimate of the Number--of 
Small Entities to Which the Proposed Rule Will Apply
    This analysis does not apply to increases in the I-901 F and M fees 
because these fees are paid by individuals who are not, for purposes of 
the RFA, within the definition of small entities established by 5 
U.S.C. 601(6). DHS believes that J fees are also paid by individuals 
and requests comment on this assumption.
    As of May 2017, there were a total of 8,746 SEVP-certified schools 
that would be subject to the I-17 recertification fee, site visit fee, 
and fee to file a motion or an appeal. New schools applying for SEVP 
certification would be subject to the proposed I-17 initial 
certification fee. Of the 8,746 SEVP-certified schools, 2,013 have 
identified as public schools on their I-17 form. The remaining 6,733 
schools have identified themselves on the Form I-17 as private for-
profit, private nonprofit, or private unspecified entities.\14\
---------------------------------------------------------------------------

    \14\ Prior to October 1, 2016, schools had two options in SEVIS 
to select their school type: Public or private unspecified. With the 
recent SEVIS update, schools can only choose one of three options: 
Public, private for-profit, or private nonprofit.
---------------------------------------------------------------------------

    Of the 2,013 SEVP-certified public schools, DHS conducted a random 
sample of 100 \15\ schools to approximate the number of public schools 
in a governmental jurisdiction with a population of less than 50,000. 
Out of the 100 public schools, 62, or 62 percent, are located in a city 
with a population fewer than 50,000. DHS infers 1,248 SEVP-certified 
public schools are considered a small entity as defined by SBA.
---------------------------------------------------------------------------

    \15\ The random sample helps ensure an accurate representation 
of the population with each school having an equal chance of being 
included. In determining the sample size DHS utilized a 90 percent 
confidence level (z-score), 10 percent margin of error (e), and a 50 
percent population proportion ([pi]) used as an unknown input and to 
maximize the estimate to overestimate sample size. The sample size 
equation used n = z2[pi](1-[pi])/e2 provided 
inputs 1.652(.5)(.5)/.01 = 69 and rounded up to 100 to 
over sample. DHS identified geographic population data matched to 
the school's city address provided in SEVIS, sourced from U.S. 
Census Bureau 2010-2016 Cities and Towns (Incorporated Places and 
Minor Civil Divisions) at https://www.census.gov/data/tables/2016/demo/popest/total-cities-and-towns.html.
---------------------------------------------------------------------------

    DHS conservatively assumes that all 1,507 private nonprofit schools 
certified by SEVP are small entities because they are not dominant in 
their fields. DHS also assumes that the 4,755 schools that are private 
unspecified are small entities. DHS requests comments on these 
assumptions.
    To determine which of the remaining 471 private for-profit schools 
are considered a small entity, DHS references the Small Business 
Administration (SBA) size standards represented by business average 
annual receipts. Receipts are generally defined as a firm's total 
income or gross income. SBA's Table of Small Business Size Standards is 
matched to the North American Industry Classification System (NAICS) 
for industries.\16\ DHS matches information provided by the schools in 
SEVIS regarding what programs of study it is engaged in with an 
appropriate NAICS industry description. NAICS is the standard 
classification used to categorize business establishments for the 
purpose of collecting, analyzing, and publishing statistical data 
related to the U.S. economy.
---------------------------------------------------------------------------

    \16\ U.S. Small Business Administration, Tables of Small 
Business Size Standards Matched to NAICS Codes (Oct. 1, 2017), 
available at https://www.sba.gov/sites/default/files/files/Size_Standards_Table_2017.xlsx.
---------------------------------------------------------------------------

    DHS finds that the revenue of 332 of the 471 private, for-profit 
schools meet the SBA size standard of a small business according to 
their industry. DHS estimates each private school's annual receipts by 
multiplying the approximate annual cost of room, board, and tuition by 
the average annual number of total students, based on data provided by 
the schools on their Forms I-17. Every 2 years, as part of the 
recertification process, a school submits the approximate annual cost 
of room, board, and tuition per student and the average annual number 
of total students, both domestic and international. DHS acknowledges 
that this method to estimate receipts may be an incomplete account of a 
school's income, which may also include contributions from private 
individuals or other endowments. Since these data reflect a snapshot of 
all SEVP-certified schools as of May 24, 2017, DHS acknowledges there 
may be day-to-day changes in the status of a school's certification and 
that a school's revenue may differ from actual revenue due to a 2-year 
lag in school self-reporting before a school is required to recertify.
    Given these assumptions, DHS estimates that 7,842 schools meet the 
SBA definition of a small entity. This is approximately 90 percent of 
the 8,746 of SEVP-certified schools included in this analysis.
    Table 28 shows a summary by school type of the number of SEVP-
certified schools and estimated small entities.

             Table 28--SEVP-Certified Schools by School Type
------------------------------------------------------------------------
               Description                     Total      Small entities
------------------------------------------------------------------------
Public Schools..........................           2,013           1,248
Private, nonprofit schools..............           1,507           1,507
Private, unspecified schools............           4,755           4,755
Private, for-profit schools.............             471             332
                                         -------------------------------
    Total Number of SEVP-Certified                 8,746           7,842
     Schools............................
------------------------------------------------------------------------

    Table 29 provides a summary of the SEVP-certified schools by 
industry. The table also shows the NAICS industry description, the 
NAICS code, and the number of small and large schools by industry. Note 
that the number of small schools includes all nonprofits and 
unspecified private schools. Most industries with SEVP-certified 
schools consist of a majority of small schools.

[[Page 33785]]



                                                 Table 29--Number of SEVP-Certified Schools by Industry
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                            Total SEVP-
            School industry                 NAICS industry description      NAICS codes      Number of    Number of non-     certified     Percent small
                                                                                           small schools   small schools      schools         schools
--------------------------------------------------------------------------------------------------------------------------------------------------------
Elementary and Secondary Schools.......  Industry primarily engaged in            611110           3,472              18           3,490              99
                                          providing academic courses and
                                          related course work that
                                          contain a basic preparatory
                                          education. A basic preparatory
                                          education generally starts
                                          kindergarten through 12th
                                          grade.
Junior Colleges........................  Industry primarily engaged in            611210              11               2              13              85
                                          providing academic or
                                          technical courses and granting
                                          associate degrees,
                                          certificates, or diplomas
                                          below the baccalaureate level.
Colleges, Universities, and              Industry primarily engaged in            611310           2,150              57           2,207              97
 Professional Schools.                    providing academic courses and
                                          granting degrees at
                                          baccalaureate or graduate
                                          levels. The requirement for
                                          admission is at least a high
                                          school diploma or equivalent
                                          general academic training.
Computer Training......................  Industry primarily engaged in            611420              13               0              13             100
                                          providing computer training
                                          (except computer repair), such
                                          as computer programming,
                                          software packages,
                                          computerized business systems,
                                          computer electronics
                                          technology, computer
                                          operations, and local area
                                          network management.
Professional and Management Development  Industry primarily engaged in            611430              18               0              18             100
 Training.                                providing a collection of
                                          short interval courses and
                                          sessions for management and
                                          professional development.
                                          Training for career
                                          development may be provided
                                          directly to individuals or
                                          through employers' training
                                          programs, and courses may be
                                          customized or modified to meet
                                          the special needs of customers.
Cosmetology and Barber Schools.........  Industry primarily engaged in            611511              91               3              94              97
                                          providing training in hair
                                          styling, barbering, or
                                          cosmetic arts, such as makeup
                                          or skin care.
Flight Training........................  Industry primarily engaged in            611512             199               1             200             100
                                          providing aviation and flight
                                          training.
Apprenticeship Training................  Industry primarily engaged in            611513              39               1              40              98
                                          providing apprenticeship
                                          training programs.
Other Technical and Trade Schools......  Industry primarily engaged in            611519             183               6             189              97
                                          providing job or career
                                          vocational or technical
                                          courses (except cosmetology
                                          and barber training, aviation
                                          and flight training, and
                                          apprenticeship training).
Fine Arts Schools......................  Establishments primarily                 611610              79               3              82              96
                                          engaged in offering
                                          instruction in the arts,
                                          including dance, art, drama,
                                          and music.
Sports and Recreation Instruction......  Industry primarily contains              611620              10               0              10             100
                                          institutions such as camps and
                                          schools, primarily engaged in
                                          providing instruction in
                                          athletic activities to groups
                                          of individuals.
Language Schools.......................  Industry primarily engaged in            611630             286              44             330              87
                                          providing foreign language
                                          instruction (including sign
                                          language).
Exam Preparation and Tutoring..........  Industry primarily engaged in            611691               8               4              12              67
                                          providing training for
                                          standardized examinations and/
                                          or educational tutoring
                                          services.
All Other Misc. Schools and Instruction  Industry primarily engaged in            611699              32               0              32             100
                                          providing instruction (except
                                          academic schools, colleges and
                                          universities, business,
                                          computer, management,
                                          technical, trade, fine arts,
                                          athletic, language
                                          instruction, tutoring, and
                                          automobile driving
                                          instruction).
Educational Support Services...........  Industry primarily engaged in            611710               2               0               2             100
                                          providing non-instructional
                                          services that support
                                          educational processes or
                                          systems.
Public Schools (Elementary, Secondary,   Industry primarily engaged in               N/A           1,248             765           2,013              62
 and High School).                        providing academic courses and
                                          related course work that
                                          contain a basic public
                                          education.
                                                                         -------------------------------------------------------------------------------
    Total..............................  ...............................  ..............           7,842             904           8,746              90
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Table 30 presents the type of schools with active F and M students 
and the percent of students enrolled in small schools. Most F and M 
students are enrolled at small schools. Of the 8,746 SEVP-certified 
schools, DHS identified 1,728 with no active F or M students and 
determined that 1,296 of these are considered small entities as defined 
by SBA. Note that although there are two SEVP-certified schools in the 
education support services industry (shown in Table 29), there are no 
active F and M students in these schools. DHS applies the results of 
the sample of SEVP-certified public schools to the number of students 
in SEVP-certified public schools (619,295) to estimate that the number 
of students in small SEVP-certified public schools is 383,963.

[[Page 33786]]



                          Table 30--Total Number of Active F and M Students by Industry
----------------------------------------------------------------------------------------------------------------
                                                                  Total active F
                                                                  and M students  Total active F    Percent of
                         School industry                             in small     and M students    students at
                                                                      schools                      small schools
----------------------------------------------------------------------------------------------------------------
Elementary and Secondary Schools................................          60,990          63,491              96
Junior Colleges.................................................             409             418              98
Colleges, Universities, and Professional Schools................         419,593         429,784              98
Computer Training...............................................             404             404             100
Professional and Management Development Training................             217             217             100
Cosmetology and Barber Schools..................................              91              93              98
Flight Training.................................................           6,598           6,605             100
Apprenticeship Training.........................................              71              75              95
Other Technical and Trade Schools...............................           1,108           1,111             100
Fine Arts Schools...............................................           1,736           2,030              86
Sports and Recreation Instruction...............................              13              13             100
Language Schools................................................          33,500          41,867              80
Exam Preparation and Tutoring...................................           1,469           1,984              74
All Other Miscellaneous Schools and Instruction.................             218             218             100
Educational Support Services....................................  ..............  ..............               0
Public Schools..................................................         383,963         619,295              62
----------------------------------------------------------------------------------------------------------------

    DHS estimated SEVP-certified public schools' revenue to examine the 
impact of the proposed fee adjustments on small public schools. The 
tuition provided by public schools in SEVIS may not represent a public 
school's total revenue because most of the U.S. students would 
generally not pay the tuition provided to attend public schools. 
Instead, DHS assumes that a public school's county or city's tax 
revenue is the best revenue source against which to assess the impact 
of the proposed fee adjustments. DHS collected local government 
revenue, expenditure, debt, and assets from the U.S. Census Bureau 2015 
State and Local Government Survey \17\ to examine the impact of the 
increased fees on the public schools included in the sample. A county 
or city's revenue may be an overestimation of a public school's 
capability to pay the fees related to SEVP-certification, appeals, or 
site visits for new locations. This revenue approximation may minimize 
the impact of the fee adjustments for public schools. DHS requests 
comments on these assumptions.
---------------------------------------------------------------------------

    \17\ Available at https://www.census.gov/govs/local/.
---------------------------------------------------------------------------

    Table 31 displays the range of annual revenue by each school 
industry and for public schools, from the small school with the lowest 
revenue to the median revenue of all the small schools to the small 
school with the largest revenue. It also shows the average revenue of 
all the small schools in that industry. The Colleges, Universities, and 
Professional Schools industry has the widest range from maximum to 
minimum revenue due to the assumption that all private, unspecified 
schools are small entities, while the Educational Support Services 
industry that only has two schools included has the smallest range of 
maximum to minimum revenue for any one industry.

                              Table 31--Range of Annual Revenue by School Industry
----------------------------------------------------------------------------------------------------------------
                                                 Lowest annual   Median annual   Largest annual   Average annual
                School industry                     revenue         revenue          revenue          revenue
----------------------------------------------------------------------------------------------------------------
Elementary and Secondary Schools..............         $28,800      $5,116,550    $1,680,000,000     $13,194,355
Junior Colleges...............................          44,400       2,560,000        15,255,000       4,271,901
Colleges, Universities, and Professional                26,400      28,432,500     5,002,524,120      96,761,518
 Schools......................................
Computer Training.............................         425,000       3,000,000        14,000,000       3,881,631
Professional and Management Development                129,600         717,500         2,904,625       1,000,423
 Training.....................................
Cosmetology and Barber Schools................          70,000       2,183,000        66,907,200       4,092,673
Flight Training...............................          36,000       3,000,000        60,000,000       5,959,154
Apprenticeship Training.......................         132,000      10,265,875       106,080,000      21,004,563
Other Technical and Trade Schools.............          64,000       2,800,000        82,800,000       7,570,939
Fine Arts Schools.............................          66,000       2,895,000       130,000,000       9,425,304
Sports and Recreation Instruction.............         276,800       1,165,000         9,312,500       2,626,805
Language Schools..............................         118,500       5,725,000       108,000,000       7,514,433
Exam Preparation and Tutoring.................       3,150,000       5,043,189        27,000,000       6,983,297
All Other Miscellaneous Schools and                     83,250         845,000       469,050,000      18,359,767
 Instruction..................................
Educational Support Services..................         340,000         521,750           703,500         521,750
Public Schools................................       4,389,000     192,353,500    17,833,251,000   1,315,830,548
----------------------------------------------------------------------------------------------------------------


[[Page 33787]]

4. A Description of the Projected Reporting, Recordkeeping, and Other 
Compliance Requirements of the Proposed Rule, Including an Estimate of 
the Classes of Small Entities That Will Be Subject to the Requirement 
and the Types of Professional Skills Necessary for Preparation of the 
Report or Record
    The proposed rule would increase and establish additional fees for 
educational institutions in support of SEVP operations. DHS estimates 
the annual impact to small schools based on the school cost of 
compliance as represented as a percentage of their annual revenue. 
Table 32 displays the proposed fees, the current fees, and the 
difference in these amounts. This analysis examines the impact that the 
proposed incremental fee for the Form I-17 certification and the 
proposed fees for recertification, site visits to add a new physical 
location or campus, and the filing of a motion or an appeal would have 
on small SEVP-certified schools.


                                     Table 32--Proposed School Fees by Type
----------------------------------------------------------------------------------------------------------------
                                                                                    Difference
                    Fee type                       Proposed fee     Current fee     (proposed-        Percent
                                                                                     current)        increase
----------------------------------------------------------------------------------------------------------------
I-17 Certification Fee..........................          $3,000          $1,700          $1,300              76
I-17 Recertification Fee........................           1,250               0           1,250             N/A
Site Visit Fee--initial.........................             655             655               0               0
Site Visit Fee--new location....................             655               0             655             N/A
Motion or Appeal Fee............................             675               0             675             N/A
----------------------------------------------------------------------------------------------------------------

I-17 Certification Fee
    A school files a petition and pays a certification fee to become 
eligible to issue the Form I-20, ``Certificate of Eligibility for 
Nonimmigrant Student Status,'' to prospective international students 
after admitting them for a course of study. Certification also 
authorizes the school to enroll international students after they enter 
the country on an F or M student visa. Schools must initially go 
through the vetting process for authorization by DHS to enroll F and/or 
M nonimmigrant students and pay the I-17 certification fee, which is 
currently $1,700 and proposed to increase to $3,000. The incremental 
fee is the difference between the proposed fee ($3,000) and current fee 
($1,700), or $1,300. From 2012 to 2016, DHS processed 2,117 I-17 
petitions and payments. Out of the 2,117 schools, 1,151, or 54 percent, 
were identified as meeting the SBA definition of a small school, or 
estimated to be a small public school based on the sample conducted, as 
illustrated in Table 33.

                               Table 33--I-17 Initial Certifications FYs 2012-2016
----------------------------------------------------------------------------------------------------------------
                                                                                                    Percent of
                                                                    Total I-17    Small school I- small school I-
                           Fiscal year                                initial       17 initial      17 initial
                                                                  certifications  certifications  certifications
----------------------------------------------------------------------------------------------------------------
2012............................................................             457             236              52
2013............................................................             382             218              57
2014............................................................             446             270              60
2015............................................................             469             260              55
2016............................................................             363             167              46
                                                                 -----------------------------------------------
    Total.......................................................           2,117           1,151              54
                                                                 -----------------------------------------------
        2014-2016 3-year annual average.........................             426             232              55
----------------------------------------------------------------------------------------------------------------

    SEVP forecasted the total I-17 initial certifications in FY 2019 
and FY 2020 to be 426 using the 3-year annual average of FY 2014 
through 2016 initial certifications. Using that same methodology, 232 
small schools applied for initial I-17 certification on average each 
year. DHS assumes the growth of small schools per industry seeking SEVP 
certification will remain constant in the future. DHS multiplied the 
annual average number of small schools applying for initial 
certification by the percent of small schools in each industry, as 
presented in Table 29. This calculation yields the number of small 
schools expected to petition for initial I-17 certification by 
industry. The results are presented in Table 34.

 Table 34--Expected Annual Number of Small Schools To Initially Certify
                           by School Industry
------------------------------------------------------------------------
                                                        Annual number of
                                                          small schools
                    School industry                       applying for
                                                             initial
                                                          certification
------------------------------------------------------------------------
Elementary and Secondary Schools......................               103
Junior Colleges.......................................                 0
Colleges, Universities, and Professional Schools......                64
Computer Training.....................................                 0
Professional and Management Development Training......                 1

[[Page 33788]]

 
Cosmetology and Barber Schools........................                 3
Flight Training.......................................                 6
Apprenticeship Training...............................                 1
Other Technical and Trade Schools.....................                 5
Fine Arts Schools.....................................                 2
Sports and Recreation Instruction.....................                 0
Language Schools......................................                 8
Exam Preparation and Tutoring.........................                 0
All Other Miscellaneous Schools and Instruction.......                 1
Educational Support Services..........................                 0
Public Schools........................................                37
                                                       -----------------
    Total Small Schools...............................               232
------------------------------------------------------------------------

    This analysis examines the impact the $1,300 incremental fee has on 
small schools that might seek initial certification after the final 
rule is effective. DHS assumes that the range of revenue of the small 
schools that will apply for certification is similar to the range of 
revenue of current SEVP-certified small schools and uses this range to 
show the potential impacts. Table 35 shows the impact as a percentage 
for the schools with the lowest annual revenue, median annual revenue, 
and largest annual revenue, as well as the average annual revenue for 
all schools in that industry. From these results, DHS does not expect 
the I-17 certification incremental fee to have an impact greater than 1 
percent on the average small school annual revenue. However, there is 
an expected impact greater than 1 percent for some small schools with 
the lowest annual revenue in their industry. On average the estimated 
194 small schools that apply for initial I-17 certification annually 
and pay an incremental fee of $1,300 will experience an impact of less 
than 1 percent of their estimated annual revenue.

                 Table 35--Initial Certification Fee Impact for Small Schools by Type of School
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                                                                                   I-17 initial
                                                   I-17 initial    I-17 initial    certification   I-17 initial
                                                   certification   certification    incremental    certification
                                                    incremental     incremental    fee impact on    incremental
                 Type of school                    fee impact on   fee impact on    the school     fee impact on
                                                    the school      the school       with the       the average
                                                     with the        with the         largest     school revenue
                                                  lowest revenue  median revenue      revenue        (percent)
                                                     (percent)       (percent)       (percent)
----------------------------------------------------------------------------------------------------------------
Elementary and Secondary Schools................             4.5             0.0             0.0            0.01
Junior Colleges.................................             2.9             0.1             0.0            0.03
Colleges, Universities, and Professional Schools             4.9             0.0             0.0            0.00
Computer Training...............................             0.3             0.0             0.0            0.03
Professional and Management Development Training             1.0             0.2             0.0            0.13
Cosmetology and Barber Schools..................             1.9             0.1             0.0            0.03
Flight Training.................................             3.6             0.0             0.0            0.02
Apprenticeship Training.........................             1.0             0.0             0.0            0.01
Other Technical and Trade Schools...............             2.0             0.0             0.0            0.02
Fine Arts Schools...............................             2.0             0.0             0.0            0.01
Sports and Recreation Instruction...............             0.5             0.1             0.0            0.05
Language Schools................................             1.1             0.0             0.0            0.02
Exam Preparation and Tutoring...................             0.0             0.0             0.0            0.02
All Other Miscellaneous Schools and Instruction.             1.6             0.2             0.0            0.01
Educational Support Services....................             0.4             0.2             0.2            0.25
Public Schools..................................             0.0             0.0             0.0             0.0
----------------------------------------------------------------------------------------------------------------

I-17 Recertification Fee
    SEVP-certified schools are required to file for recertification 
every 2 years to demonstrate that they have complied with all 
recordkeeping, retention, reporting, and other requirements when 
registering F and M students. There is currently no fee charged to 
schools for recertification, but this proposed rule establishes a new 
fee for that process.
    To measure the impact on small schools, DHS first estimated the 
number of small schools that will recertify. DHS assumes 50 percent 
(4,373) of the total number of schools in this analysis (8,746) will 
recertify each year. DHS multiplies the recertification rate of 50 
percent by the total number of small schools to generate the estimation 
that 3,921 \18\ small schools will recertify annually. DHS examined all 
7,842 small SEVP-certified schools to determine the impact of the 
recertification fee, as it is assumed that a significant number of the 
schools will pursue recertification within the next 2 years.
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    \18\ 7,842 x 50 percent = 3,921 small schools recertifying each 
year.

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[[Page 33789]]

    DHS assumes that the total number of SEVP-certified schools will 
remain static as new schools become certified and other schools 
withdraw certification. DHS therefore assumes that the annual increase 
of total recertifications will be zero.
    As previously discussed, DHS identified 1,296 SBA-defined small 
schools with no active F or M international students. DHS included 
these schools in this analysis and assumes they will opt to pay the 
recertification fee of $1,250 rather than reapplying for initial 
certification with a proposed fee of $3,000 at such time in the future 
that they enroll F or M students.
    Table 36 illustrates the number of small schools that will 
recertify by industry and the I-17 recertification incremental fee 
impact as a percent of the small school's annual revenue. From these 
findings, of the 7,842 small schools expected to apply for 
recertification and pay the proposed fee of $1,250, 50 schools, or 0.6 
percent, will experience an impact greater than 1 percent but less than 
3 percent of the school's annual revenue. For the remaining schools, 
DHS does not expect the incremental fee to have an impact of greater 
than 1 percent.

                    Table 36--Recertification Fee Impact for Small Schools by Type of School
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                 School industry                   0%https://www.uscis.gov/i-290b.
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    DHS processed 215 motions and appeals from schools from 2013 to 
2016. Out of the 215 school motions and appeals, DHS determined that 
74, or 34.4 percent, were filed by small schools. Among the 74 small 
schools, 4 had 2 appeals within the same year or over the 4-year 
period. During the 4-year period, there was an average of 19 appeals 
and motions filed by small schools annually.
    DHS examined all 7,842 small schools to estimate the impact of the 
proposed appeal and motion fee on estimated annual revenue. The impact 
is calculated by dividing the fee to file a motion or appeal by the 
school's estimated annual revenue. Of the 7,842 SEVP-certified small 
schools, 7,826, or 99.8 percent, would experience an impact less than 
or equal to 1 percent of their estimated annual revenue were the school 
to file an appeal or motion. DHS estimates 13 small schools, or 0.2 
percent, would realize an impact between 1 percent and 2 percent of 
their estimated annual revenue. In addition, three small schools, or 
0.04 percent, would experience an impact greater than 2 percent but 
less than 3 percent of estimated annual revenue. Table 38 shows the 
number of small schools within the range of impact to each school's 
estimated annual revenue.

                       Table 38--Appeal and Motion Fee Impact on Estimated Annual Revenue
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                 Type of school                    0%