Rule2021-19034
Fees for Supervision of Official Inspection and Weighing Services Performed by Delegated States and Designated Agencies, Miscellaneous Fees for Other Services, and Removal of Specific Fee References
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
September 3, 2021
Effective
October 4, 2021
Issuing agencies
Agriculture DepartmentAgricultural Marketing Service
Abstract
This final rule revises regulations under authority of the United States Grain Standards Act (USGSA) by implementing a standardized formula model for calculating Federal Grain Inspection Service (FGIS) supervision fees. The revision enables FGIS to adjust supervision fees annually in order to maintain an appropriate operating reserve as required by the USGSA. As with other Agricultural Marketing Service (AMS) fee-based programs, AMS will publish annual FGIS fee updates in the Federal Register and post updated fee schedules on its website. The revision also eliminates or revises certain registration and duplication fees charged by FGIS.
Full Text
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<title>Federal Register, Volume 86 Issue 169 (Friday, September 3, 2021)</title>
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[Federal Register Volume 86, Number 169 (Friday, September 3, 2021)]
[Rules and Regulations]
[Pages 49466-49470]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2021-19034]
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DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 800
[Doc. No. AMS-FGIS-20-0001]
RIN 0581-AD94
Fees for Supervision of Official Inspection and Weighing Services
Performed by Delegated States and Designated Agencies, Miscellaneous
Fees for Other Services, and Removal of Specific Fee References
AGENCY: Agricultural Marketing Service, Department of Agriculture
(USDA).
ACTION: Final rule.
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SUMMARY: This final rule revises regulations under authority of the
United States Grain Standards Act (USGSA) by implementing a
standardized formula model for calculating Federal Grain Inspection
Service (FGIS) supervision fees. The revision enables FGIS to adjust
supervision fees annually in order to maintain an appropriate operating
reserve as required by the USGSA. As with other Agricultural Marketing
Service (AMS) fee-based programs, AMS will publish annual FGIS fee
updates in the Federal Register and post updated fee schedules on its
website. The revision also eliminates or revises certain registration
and duplication fees charged by FGIS.
[[Page 49467]]
DATES:
Effective date: October 4, 2021.
Applicability date: October 1, 2021.
FOR FURTHER INFORMATION CONTACT: Denise Ruggles, FGIS Executive Program
Analyst, AMS, USDA; Telephone: (816) 702-3897; Email:
<a href="/cdn-cgi/l/email-protection#175372797e6472395a39456270707b7264576264737639707861"><span class="__cf_email__" data-cfemail="672302090e1402492a49351200000b0214271214030649000811">[email protected]</span></a>.
SUPPLEMENTARY INFORMATION: The USGSA (7 U.S.C. 71 et seq.) authorizes
FGIS, a program area within AMS, to supervise grain inspection and
weighing services provided by official agencies and to charge and
collect reasonable fees to cover costs of such supervision. These fees
are charged by official agencies to their customers (grain industry) as
part of the overall fee charged for inspection and weighing services.
Supervision fees collected by FGIS cover, as nearly as practicable, all
operating and administrative costs associated with supervising official
agencies.
FGIS regularly reviews user-fees to determine whether fees are
adequate and would likely maintain appropriate operating reserve funds.
On July 1, 2016, following such a review (81 FR 41790; June 28, 2016),
FGIS suspended the assessment of fees for supervision of official
inspection and weighing services performed by delegated States and
designated agencies to reduce the operating reserve. This suspension
ended on December 31, 2020. FGIS's operating reserve at that time was
adequate to cover six months' operating expenses as required, but FGIS
resumed the assessment of tonnage fees to cover operating costs of
supervision.
FGIS is implementing the use of a standardized formula model to
determine if user-fee adjustments are necessary to recover costs
associated with administering the official agency supervision program.
This action is intended to assure FGIS maintains the financial
stability necessary to provide inspection and weighing services to the
grain industry, which facilitates the sound and orderly marketing of
grain in domestic and export markets.
AMS invited comments on the proposed rule identifying changes to
the methodology for establishing FGIS user fees for supervision of
official inspection and weighing services performed by delegated
agencies and the removal of specific references to user fees (86 FR
12119; March 2, 2021). AMS received two comments in response to the
proposed rule that were supportive. Comments indicated that this
approach would moderate fee changes and provide for predictable time
intervals.
Fees for supervising official agencies were last revised in 2005
(70 FR 50149; August 26, 2005). The fee schedule at 7 CFR 800.71(a)(2)
(Schedule B) has not been changed since then. Currently, the FGIS fee
for supervision of official agencies is set at $0.011 per metric ton of
domestic U.S. grain shipments inspected or weighed, or both, including
land carrier shipments to Canada or Mexico.
Financial data for the supervision of official agencies program for
fiscal years (FY) 2016 through 2020 is reviewed in Table 1.
Table 1--Supervision of Official Agencies Financial Analysis
[Millions of dollars] *
----------------------------------------------------------------------------------------------------------------
FY 16 FY 17 FY 18 FY 19 FY 20
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Revenue......................... $1.91 $0.00 $0.00 $0.00 $0.00
Obligations..................... 1.43 1.78 1.88 1.55 1.81
Annual Surplus or (Deficit)..... 0.47 (1.78) (1.88) (1.55) (1.81)
Operating Reserve--running 8.73 6.95 5.08 3.53 1.73
balance........................
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* Figures may not sum due to rounding and adjustments of prior year obligations.
As illustrated by Table 1, though revenues have been suspended
since July 2016, FGIS obligations have generally increased due to
inflation and cost of living adjustments. The exception was in FY19,
when accounts of the former Grain Inspection, Packers and Stockyards
Administration (GIPSA), which included FGIS, were merged with AMS,
along with the close-out of obligations. As explained above, the
current fee structure generated a recurring annual operating surplus
for several years, resulting in a decision to suspend the collection of
the fees in 2016 to gradually reduce operating reserves to meet AMS's
target of maintaining funds to cover between three to six months'
expenses. Monthly costs to operate the supervision of official agencies
in FY 2020 were $151,000. Thus, AMS would consider an operating reserve
between $0.45 million and $0.91 million (3 and 6 times the monthly
operating cost, respectively) at the end of FY 2020 to be appropriate.
At the end of FY 2020, the operating reserve balance was $1.73 million,
enough to cover 11\1/2\ months of expenses.
To prevent accumulating a reserve balance beyond the targeted
amount (3 to 6 times the monthly operating cost), AMS is adopting a
standardized formula for calculating user fees for each calendar year
(CY). AMS expects that reducing fees in this manner will gradually
reduce the reserve fund balance, while allowing FGIS to continue making
strategic operational expenditures to meet industry expectations and
achieve United States Department of Agriculture (USDA) goals.
Calculations
AMS will calculate the supervision tonnage fee using prior year's
actual costs and average yearly tonnage of domestic U.S. grain
shipments inspected or weighed, or both, including land carrier
shipments to Canada and Mexico during the previous 5 fiscal years.
AMS adds new Sec. 800.71(b)(2)(i) and (ii) to include the
following formulas for calculating fee rates for CY 2021 and succeeding
years:
Operating Reserve Adjustment. FGIS will divide the total prior year
supervision costs by 2 to determine the 6-months operating reserve
goal. From that value, FGIS will subtract the FY operating reserve
ending balance to obtain the operating reserve adjustment for
determining the supervision tonnage fee.
The operating reserve adjustment for calendar year 2021 is -
$821,925. The calculation, using FY 2020 supervision costs of
$1,807,633, is: $1,807,633 divided by 2, which equals $903,817.
Subtract the FY 2020 operating reserve ending balance of $1,725,742 to
equal -$821,925.
Supervision tonnage fee. FGIS will add total prior-year supervision
costs and the operating reserve adjustment, then divide the result by
the average tonnage for the previous 5-years. If the calculated fee is
zero or a negative value, FGIS will suspend collection of supervision
tonnage fees for the next calendar year.
[[Page 49468]]
The supervision tonnage fee for calendar year 2021 is $0.004 per
ton. The calculation, based on FY 2020 supervision costs of $1,807,633,
is $1,807,633 plus the operating reserve adjustment of -$821,925, which
equals $985,670. Divide this adjustment rate by the 5-year average
tonnage of 232,398,847, to derive $0.004 per ton.
------------------------------------------------------------------------
Fiscal year Metric tons
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2016................................................. 238,996,932
2017................................................. 244,355,906
2018................................................. 234,298,085
2019................................................. 206,693,881
2020................................................. 237,649,430
5-year Rolling Average............................... 232,398,847
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In addition to implementing a new formula for calculating
supervision tonnage fees, this final rule also revises:
<bullet> Section 801.71(a)(2)--Schedule B--to remove the currently
specified fee and to provide that annual supervision fees will be as
published on the AMS website.
<bullet> The introductory text of Sec. 801.71(b)--Annual review of
fees--to convey that weighing and inspection fees, as well as
supervision fees, will be recalculated annually.
<bullet> Section 801.71(b)(1)--to clarify that tonnage fees
calculated in that section pertain only to FGIS inspection and weighing
(Schedule A) fees.
<bullet> Section 801.71(b)--by redesignating paragraph (b)(2) as
paragraph (b)(3) and adding a new paragraph (b)(2) that outlines
supervision fee calculations, as described earlier.
Miscellaneous Fees for Other Services
In addition to the above changes related to supervision fees, AMS
is implementing the following changes to other fee requirements in
Sec. 801.71(d).
This final rule removes the introductory text of Sec.
801.71(d)(1)(i)--Registration certificates and renewals, and
consolidates paragraphs (d)(1)(i)(A) and (B) of that section, which
currently provide flat fees for registering business operations that
buy, handle, weigh, or transport grain for sale in foreign commerce or
for such businesses that are also in a control relationship with
respect to a business that buys, handles, weighs, or transports grain
for sale in interstate commerce. Currently, the registration fee for
the former is $135, and the registration fee for the latter is $270.
This final rule combines the two charges into one. AMS will calculate
the export registration fee using the following formula and adjust the
fees annually, as necessary.
Registration certificates and renewals. FGIS will multiply the
Sec. 800.71(a) Table 1 of Schedule A noncontract hourly rate by a
quantity of five. The fee covers FGIS personnel costs to review
applications, fee publication expenses, and administrative expenses.
The Schedule A non-contract hourly rate is currently $63. Thus, the
consolidated certificate registration and application fee for 2021 will
be $63 multiplied by a quantity of 5, or $315. AMS will publish the
annual rate in the Federal Register and on the AMS website.
This final rule removes Sec. 800.71(d)(1)(ii), which provides
charges for providing extra copies of registration certificates, as
certificates are now provided electronically for printing by the
applicant.
This final rule revises Sec. 800.71(d)(2) to remove the provision
of a flat fee for applications to amend an official agency designation.
FGIS will instead calculate the rate using the following formula, and
the rate will be adjusted annually and published on the AMS website.
Designation amendments. FGIS will calculate the rate using the
Federal Register publication rate for three columns, plus one hour of
noncontract hourly rate from Sec. 800.71(a) Table 1 of Schedule A. The
fee covers FGIS personnel costs, administrative expenses, and Federal
Register publication costs.
The current rate is $75 per application; AMS calculates the fee
will be $540 for calendar year 2021 using current publication fees. AMS
typically receives only one or two requests each year, so the overall
cost to official agencies is not expected to be significant. AMS will
review the cost to process and publish designation amendments and
adjust the fees annually, as necessary.
Finally, this final rule removes Sec. 800.71(d)(3), which provides
a flat application fee for operating a scale testing organization. FGIS
hasn't approved such an organization in the past 5 years. States that
operate as scale testing organizations, in addition to FGIS, provide
service in areas that are not in reasonably close proximity to FGIS
duty stations. Scale operators pay far less in travel costs by
obtaining services provided by their local State scale testing
organizations on behalf of FGIS. Additionally, this increases FGIS
efficiency by reducing staff travel and allowing staff to be deployment
to other mission duties.
Executive Orders 12866 and 13563
Executive Orders 12866--Regulatory Planning and Review, and 13563--
Improving Regulation and Regulatory Review, direct agencies to assess
all 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 of reducing costs, harmonizing rules, and promoting
flexibility. This rule does not meet the criteria of a significant
regulatory action under Executive Order 12866 as supplemented by
Executive Order 13563. Therefore, the Office of Management and Budget
(OMB) has not reviewed this rule under those orders.
AMS considered several alternatives to changes made by this rule,
including reinstating the current fee or applying a standardized
formula using one year of supervision tonnage versus the five-year
supervision tonnage average. Ultimately, AMS determined that the
proposed approach of recalculating the fee each year using a standard
formula based on a five-year supervision tonnage average would provide
savings to the industry when the operating reserve balance exceeds
FGIS's goal and would limit large fee increases following years where
supervision tonnage volumes are significantly less. AMS expects changes
made by this rule to benefit the grain industry by adjusting
supervision fees as needed annually to reflect actual expenses related
to grain inspections supervision and maintaining appropriate operating
reserve balances. AMS does not expect the rule to provide any
environmental, public health, or safety benefits. AMS has not
identified any costs related to this action.
Executive Order 12988
This rule has been reviewed under Executive Order 12988--Civil
Justice Reform. This rule is not intended to have retroactive effect.
The USGSA provides in Sec. 87g that no State or subdivision thereof may
require or impose any requirements or restrictions concerning the
inspection, weighing, or description of grain under the Act. This rule
does not preempt any State or local laws, regulations, or policies,
unless they present an irreconcilable conflict with this rule. No
administrative proceedings would be required before parties could file
suit in court challenging provisions of this rule.
Executive Order 13175
This rule has been reviewed under E.O. 13175--Consultation and
Coordination with Indian Tribal Governments, which requires agencies to
consider whether their rulemaking actions would have tribal
implications. AMS has determined that this rule is
[[Page 49469]]
unlikely to have substantial direct effects on one or more Indian
tribes, on the relationship between the Federal Government and Indian
tribes, or on the distribution of power and responsibilities between
the Federal Government and Indian tribes.
Regulatory Flexibility Analysis
Pursuant to requirements set forth in the Regulatory Flexibility
Act (RFA) (5 U.S.C. 601-602), AMS has considered the economic impact of
this action on small entities. The purpose of the RFA is to fit
regulatory actions to the scale of businesses subject to such actions
in order that small businesses will not be unduly or disproportionately
burdened.
This rule sets fees for three different FGIS functions: (1) Fees
for FGIS Supervision, (2) fees for registration certificates and
renewals for exporters of grain, and (3) fees for amending the
designation of official agencies.
AMS has determined that this rule does not have a significant
economic impact on a substantial number of small entities because most
applicants (grain industry) that apply for these official services and
are subjected to AMS supervision fees do not meet the requirements for
small entities. This rule will affect entities engaged in shipping
grain to and from points within the United States and exporting grain
from the United States to Canada and Mexico. There are approximately
9,500 off-farm storage facilities in the United States that could
receive grain services from delegated States or designated agencies.
AMS estimates 25 percent of these users would be considered small
businesses based on criteria established by the Small Business
Administration (13 CFR 121.201) (SBA). SBA uses the North American
Industry Classification System (NAICS) to categorize various industry
businesses. SBA defines small grain retailers and warehouse and storage
facilities, NAICS codes 424510 and 493130, respectively, as those whose
annual receipts do not exceed $30,000,000 or who have no more than 200
employees, respectively.
With respect to fees for supervision, these fees are a minor amount
compared to the total value of grain shipments. Carrier types shipped
by small entities are submitted samples and trucks with a standardized
weight of 23.95 metric tons and railcars with a standardized weight of
99.79 metric tons. Supervision fees assessed on these carriers at the
current published rate are $0.26 per truck (2020 corn market-year value
of $2,700) and $1.10 per railcar (2020 corn market-year value of
$12,600).
The registration certificate and renewal fee applies to persons
engaged in the business of buying grain for sale in foreign commerce
and in the business of handling, weighing, or transporting grain for
sale in foreign commerce. Under provisions of the USGSA, grain exported
from the United States must be officially inspected and weighed.
Mandatory inspection and weighing services were provided by AMS and
official agencies on a fee basis for 97 registered exporters in CY
2020. Eighty-three of the registered entities are owned and managed by
multi-national corporations, large cooperatives, or public entities
that do not meet the criteria for small entities established by the
SBA. In 2020, approximately fourteen small exporters registered with
FGIS. As explained, with the registration fees for 2021 calculated to
be $315, FGIS believes the change in registration fees would have a
minor effect on the small number of small business that register with
FGIS.
Finally, the designation amendment fee applies to an official
agency requesting a modification to its designation within the five-
year designation period. AMS has 42 designated States and agencies, and
13 of these designated agencies meet the criteria for small entities
established by the SBA. As explained earlier, the designation amendment
fee for 2021 is calculated to be $540. FGIS believes the revised
designation amendment fee would have a minor impact on small
businesses, since it typically receives no more than two modification
requests per year.
The adoption of standardized AMS user-fee rate calculations for
2021 and beyond would benefit all inspection applicants, regardless of
size, as fees would more closely reflect the current cost of
inspections, and the fee calculation process would be more transparent.
Through its annual review, AMS would be able to monitor the financial
status of the grain supervision program to determine whether further
adjustments are necessary.
AMS has determined this rule would not have a significant economic
impact on a substantial number of entities as defined under the RFA
because fewer than half of the applicants for grain inspection services
meet the definition of small entities.
Finally, USDA has not identified any relevant Federal rules that
duplicate, overlap, or conflict with this rule.
Paperwork Reduction Act and E-Government Act
In compliance with the Paperwork Reduction Act of 1995 (44 U.S.C.
Chapter 35), the information collection and record keeping requirements
for the program providing supervision of official agencies have
previously been approved by OMB under control number 0580-0013. No
additional reporting, record keeping, or other compliance requirements
will be imposed as a result of this rule.
AMS is committed to complying with the E-Government Act (44 U.S.C.
3601 et seq.), to promote the use of the internet and other information
technologies to provide increased opportunities for citizen access to
Government information and services, and for other purposes.
List of Subjects in 7 CFR Part 800
Administrative practice and procedure, Grain.
For reasons set forth in the preamble, AMS amends 7 CFR part 800 as
follows:
PART 800--GENERAL REGULATIONS
0
1. The authority citation for part 800 continues to read as follows:
Authority: 7 U.S.C. 71-87k.
0
2. Amend Sec. 800.71 by:
0
a. Revising paragraph (a)(2);
0
b. Revising paragraph (b) introductory text;
0
c. Revising the first sentence in paragraph (b)(1);
0
d. Redesignating paragraph (b)(2) as paragraph (b)(3);
0
e. Adding new paragraph (b)(2); and
0
f. Revising paragraph (d).
The revisions and addition read as follows:
Sec. 800.71 Fees assessed by the Service.
(a) * * *
(2) Schedule B--Fees for Supervision of Official Inspection and
Weighing Services Performed by Delegated States and Designated Agencies
in the United States. The Service will assess a supervision fee per
metric ton of domestic U.S. grain shipments inspected or weighed, or
both, including land carrier shipments to Canada and Mexico. For each
calendar year, the Service will calculate Schedule B fees as defined in
paragraph (b) of this section. The Service will publish a notice in the
Federal Register and post Schedule B fees on the Agency's public
website.
(b) Annual review of fees. For each calendar year, starting with
2021, the Service will review fees included in this section and publish
fees each year according to the following:
(1) Tonnage fees. Tonnage fees in Schedule A in paragraph (a)(1) of
this section will consist of the national tonnage fee and local tonnage
fees and
[[Page 49470]]
the Service will calculate and round the fee to the nearest $0.001 per
metric ton. * * *
* * * * *
(2) Supervision fee. Supervision fee in Schedule B in paragraph
(a)(2) of this section will be set according to the following:
(i) Operating reserve adjustment. The operating reserve adjustment
is the supervision program costs for the previous fiscal year divided
by 2 less the end of previous fiscal year operating reserve balance.
(ii) Supervision tonnage fee. The supervision tonnage fee is the
sum of the prior fiscal year program costs plus operating reserve
adjustment divided by the average yearly tons of domestic U.S. grain
shipments inspected or weighed, or both, including land carrier
shipments to Canada and Mexico during the previous 5 fiscal years. If
the calculated value is zero or a negative value, the Service will
suspend the collection of supervision tonnage fees for one calendar
year.
* * * * *
(d) Miscellaneous fees for other services. For each calendar year,
the Service will review fees included in this section and publish fees
in the Federal Register and on the Agency's public website.
(1) Registration certificates and renewals. The fee for
registration certificates and renewals will be published annually in
the Federal Register and on the Agency's public website, and the
Service will calculate the fee using the noncontract hourly rate
published pursuant to 7 CFR 800.71(a)(1) multiplied by five. If you
operate a business that buys, handles, weighs, or transports grain for
sale in foreign commerce, or you are also in a control relationship
with respect to a business that buys, handles, weighs, or transports
grain for sale in interstate commerce, you must complete an application
and pay the published fee.
(2) Designation amendments. The fee for amending designations will
be published annually in the Federal Register and on the Agency's
public website. The Service will calculate the fee using the cost of
publication plus one hour at the noncontract hourly rate. If you submit
an application to amend a designation, you must pay the published fee.
Erin Morris,
Associate Administrator, Agricultural Marketing Service.
[FR Doc. 2021-19034 Filed 9-2-21; 8:45 am]
BILLING CODE P
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