Notice2025-00421
Veterinary Services User Fees
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
January 10, 2025
Effective
January 10, 2025
Issuing agencies
Agriculture DepartmentAnimal and Plant Health Inspection Service
Abstract
The Animal and Plant Health Inspection Service (APHIS) is announcing adjusted user fee rates for the costs of providing certain goods and services, including veterinary diagnostic goods and services and veterinary services for imports and exports of live animals and animal products. This action is necessary because the regulations provide that APHIS will issue such a notice. This action ensures that the fees charged more closely align with the costs of providing the goods or services, thus ensuring program solvency.
Full Text
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<title>Federal Register, Volume 90 Issue 6 (Friday, January 10, 2025)</title>
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[Federal Register Volume 90, Number 6 (Friday, January 10, 2025)]
[Notices]
[Pages 1941-1945]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2025-00421]
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DEPARTMENT OF AGRICULTURE
Animal and Plant Health Inspection Service
[Docket No. APHIS-2023-0058]
Veterinary Services User Fees
AGENCY: Animal and Plant Health Inspection Service, U.S. Department of
Agriculture (USDA).
ACTION: Final notice.
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SUMMARY: The Animal and Plant Health Inspection Service (APHIS) is
announcing adjusted user fee rates for the costs of providing certain
goods and services, including veterinary diagnostic goods and services
and veterinary services for imports and exports of live animals and
animal products. This action is necessary because the regulations
provide that APHIS will issue such a notice. This action ensures that
the fees charged more closely align with the costs of providing the
goods or services, thus ensuring program solvency.
DATES: The fee rates in this notice go into effect January 10, 2025.
FOR FURTHER INFORMATION CONTACT: For information on the user fee
activities covered by this notice, contact Ms. Lisa Slimmer, User Fee
Financial Team Manager, Veterinary Services Money Management, 920 Main
Campus Drive, Raleigh, NC 27606; (919) 414-7205.
SUPPLEMENTARY INFORMATION:
Background
The regulations in 9 CFR part 130 (referred to below as the
regulations or the user fee regulations), cover user fees to reimburse
the U.S. Department of Agriculture's (USDA's) Animal and Plant Health
Inspection Service (APHIS) for the costs of providing veterinary
diagnostic services and import/export related services for live
animals, animal products and byproducts, poultry, birds, germplasm,
organisms, and vectors. These user fees are authorized by section
2509(c) of the Food, Agriculture, Conservation, and Trade Act (FACT
Act) of 1990, as amended (21 U.S.C. 136a(c)), which provides that the
Secretary of Agriculture may, among other things, prescribe regulations
and collect fees to recover the costs of providing import/export
related services for animals, animal products and byproducts, birds,
germplasm, organisms, and vectors, and for veterinary diagnostics
relating to the control and eradication of communicable diseases of
livestock or poultry within the United States.
Since fiscal year 1992, APHIS has received no directly appropriated
funds to cover the cost of certain veterinary diagnostics or to provide
import/export related services for animals, animal products and
byproducts, birds, germplasm, organisms, and vectors. Our ability to
provide these services depends on user fees. User fees are associated
with providing services for live animal, animal product, bird, and
germplasm imports and exports and the user fees fund, among other
things, quarantine services, the processing of import permit
applications, port of entry inspections, inspections and approvals of
import/export facilities and establishments, endorsements of export
certificates, and services related to emergency situations that arise
during the export or import process.
On August 1, 2023, APHIS published a final rule in the Federal
Register that revised the regulations (88 FR 49994-50002, Docket No.
APHIS-2021-0052, referred to below as the August 2023 final rule).\1\
This final rule removed tables providing the individual fees from the
regulations and instead indicated that they are posted on the following
website: <a href="http://www.aphis.usda.gov/business-services/vs-fees">www.aphis.usda.gov/business-services/vs-fees</a>. It also provided
that, on an annual basis, APHIS would propose changes to the fee rates
through publication of a notice in the Federal Register.
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\1\ To view the final rule, go to <a href="https://www.regulations.gov/document/APHIS-2021-0052-0014">https://www.regulations.gov/document/APHIS-2021-0052-0014</a>.
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On November 8, 2024, we published the first such notice in the
Federal Register (89 FR 88697, Docket No. APHIS-2023-0058, referred to
below as the November 2024 notice).\2\
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\2\ To view the notice or the comments that we received, go to
<a href="https://www.regulations.gov/docket/APHIS-2023-0058">https://www.regulations.gov/docket/APHIS-2023-0058</a>. Additionally,
please note that on November 22, 2024, we issued a correction to the
notice to provide a proposed fee that was inadvertently omitted from
table 21 in the initial notice.
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We solicited comments on the notice for 30 days, ending on December
9, 2024. We received 33 comments by that date from industry groups and
private citizens.
General Comment
Four of the commenters supported the fee increases articulated in
the notice. One of these commenters asked if the revenue generated by
the fee increases would be used to reopen an USDA APHIS office in
Conyers, Georgia.
We are uncertain what office the commenter is referring to because
the USDA APHIS office in Conyers, Georgia is currently open.
Similarly, a commenter asked us if the additional revenue generated
by the fees would go to additional staffing of
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personnel at ports of entry, particularly those along the southern
border.
The fees collected are allocated, in part, to staffing port
environs. However, due to the nature of fee remittance and the Federal
hiring process, it may take time before additional personnel are hired
and stakeholders experience the benefits associated with the additional
staffing.
Twenty-nine commenters disagreed with the proposed user fees for
various reasons. We discuss these comments below, by topic.
Several commenters stated that they would either have to assume the
financial burden associated with the fee increases as part of their
business model, or pass them off to other parties in their supply
chain. The commenters stated that these impacts could adversely impact
international trade.
We acknowledge that the parties subject to the user fees will have
to assume the costs of the increased fees, and could pass this cost
differential through to other parties in their supply chain. However,
the commenters did not state that the fees had been miscalculated.
Additionally, as we stated in the August 2023 final rule, the November
2024 notice, and this document, APHIS has received no directly
appropriated funds to cover the cost of certain veterinary diagnostics
or to provide import/export related services for animals, animal
products and byproducts, birds, germplasm, organisms, and vectors. Our
ability to provide these services depends on user fees. In addition, as
discussed later in this notice, the fees must be changed in order to
ensure that the program remains solvent and there are no disruptions of
the services provided.
A number of commenters stated that the customer service associated
with some of the services funded by the fees was suboptimal and/or non-
standardized. Of these, several commenters recommended that APHIS'
Veterinary Services (VS) provide service standards and guidelines for
user fee activities to ensure consistency of services provided. In a
similar vein, several commenters stated that import/export-related
services were often technically difficult and inexperienced APHIS
personnel could take longer to do the task, leading to disparate and
potentially inflated levels of effort, and, in turn, higher fees.
The fees are based on average level of effort associated with the
service. This helps ensure that the fees are not set against outlying
scenarios that may not be indicative of usual level of effort. With
that being said, APHIS exercises multiple controls to ensure that work
is done in an efficient and standardized manner. This includes
requiring specialized experience or its equivalent as a condition of
hiring, and standard operating procedures for employees in the form of
VS guidance documents (VSGs). While some of these VSGs are internal-
facing, APHIS has made many of them publicly available for the sake of
transparency and as a service to the general public. For example, VSGs
related to the import and export of equines are found here: <a href="https://www.aphis.usda.gov/live-animal-import/equine/vs-guidance">https://www.aphis.usda.gov/live-animal-import/equine/vs-guidance</a>. Finally,
because commenters did not provide information regarding the services
they claimed were occurring suboptimally or in a non-standard manner,
APHIS is unable to evaluate these claims further.
One commenter who stated that they were currently dissatisfied with
the service provided by APHIS stated that the fees should not be raised
until customer satisfaction increases.
Such a delay runs the risk of disruption of the services provided
or, in a worst-case scenario, program insolvency due to insufficient
funds, which would run counter to the commenter's request for increased
customer service. Based on current and projected revenue, the program
runs the risk of such disruptions if the fees are not increased by
early spring 2025.
Several commenters stated that advance notification was necessary
regarding any regulatory changes to the fee structure or possible
increases in fees. One commenter requested at least 12 months advance
notification, while others stated that this should be at least 12 to 24
months before the fees are raised. The commenter asking for at least 12
months advance notification characterized the fee increases in the
November 2024 notice as an abrupt policy change and without prior
notice.
On October 3, 2022, we issued the proposed rule on which the August
2023 final rule revising the regulations was based (87 FR 59731-59740,
Docket No. APHIS-2021-0052, referred to below as the October 2022
proposed rule). In it, we indicated the nature of the regulatory
revisions contemplated, and stated ``we anticipate that, since APHIS'
import/export and veterinary diagnostic user fees have not been updated
for more than 10 years, there will be a change in the fees when APHIS
applies this new approach.'' (87 FR 59732). We also stated that we
intended to issue a notice annually proposing actual fee rates. In the
August 2023 final rule, we again indicated that we would publish an
annual notice, and stated that it was the Agency's intent to issue
initial and second notices adjusting the fees on an annual basis. (88
FR 49995). Finally, our November 2024 notice proposing the updated fee
rates itself had a public comment period. In light of the foregoing, we
believe that there was adequate notification provided of the changes to
the regulations, the likelihood of fee increases, and the specific
nature of the increases; we therefore disagree that the proposed fee
increases were an abrupt policy change. Moreover, as noted above,
further delay of issuance of the adjusted fees runs the risk of
disruption of the services provided or, in a worst-case scenario,
program insolvency due to insufficient funds. Based on current and
projected revenue, the program runs the risk of such disruptions if the
fees are not increased by early spring 2025.
Several commenters stated that APHIS should have engaged
stakeholders prior to proposing to revise the fees.
APHIS has consistently apprised stakeholders of the need to revise
the current fees. Additionally, we note that both the October 2022
proposed rule and the November 2024 notice referenced above provided an
opportunity for stakeholder feedback in the form of public comment.
Finally, APHIS issued notifications of the availability of both the
October 2022 proposed rule and the November 2024 notice using our
Stakeholder Registry. To subscribe to the Stakeholder Registry, please
visit <a href="https://public.govdelivery.com/accounts/USDAAPHIS/subscriber/new">https://public.govdelivery.com/accounts/USDAAPHIS/subscriber/new</a>.
APHIS strives to ensure that any changes in our policies/regulations
are communicated early and robustly through the Stakeholder Registry
and other outreach mechanisms.
One commenter suggested that an advisory group be established
relative to the user fee regulations.
While outside the scope of this notice, we will take this
suggestion into consideration.
Several commenters suggested that APHIS consider phased
implementation with an altered fee structure that would allot
additional time for industries to adapt to the new fees. One commenter
stated we should consider implementation a year after publishing, and
another commenter suggested implementation over several years.
The costs of providing veterinary diagnostic and import/export
related services is unsustainable at the current fee rates, and the
program runs the risk of disruption of the services provided or, in a
worst-case scenario, program insolvency due to insufficient funds.
Based on current and projected revenue, the program runs the risk of
such
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disruptions if the fees are not increased by early spring 2025. This
precludes prolonged phased implementation of the fees.
Several commenters recommended that we tier services. Tiering
suggestions included lower fees for smaller businesses, high-volume
consumers of the service for which the fee is assessed, the species in
question, or biosecurity compliance history.
As noted in the November 2024 notice, APHIS sets user fees based on
the average level of effort identified to complete each service, for
which a user fee is assessed, referred to as the direct time factor in
minutes. To determine the direct time factor in minutes for each
service, we conducted labor surveys for each of the organizations
providing the services. APHIS does not charge different fees based on
the size of an organization receiving the service, or the volume of
times the organization receives the services. One of the primary
reasons for this is to ensure that cross-subsidization of differing fee
areas does not occur; cross-subsidization is prohibited by the FACT
Act.
APHIS does charge different fees for different species of animals
when the service provided for one species of animal is disaggregated
from services provided to other species of animals. For example, we
charge different user fees for different species of animals and birds
receiving standard housing, care, feed, and handling while quarantined
in an APHIS-owned or operated animal import center or quarantine
facility. However, disaggregation is not always possible depending on
the service in question. We discuss this at greater length later in
this notice.
Several commenters suggested that some of the services for which
fees are currently assessed could be subdivided into further fee
classes based on level of effort. For example, one commenter suggested
that export health certificates could be assessed different fees based
on whether or not the certificates require additional attestations,
test results, or other certifications.
With regard to the commenter's example, APHIS currently does
subdivide the user fee for export health certificates based on whether
or not the certificate requires additional endorsements, certificates,
or verification of tests or vaccinations. This was previously set forth
in the regulations themselves, and was presented in tables 24 and 25 of
the November 2024 notice.
If a fee is not currently subdivided, it is because the fee was not
subdivided previously in the regulations. APHIS did not amend the fee
categories in the August 2023 final rule. Rather, as noted previously,
we moved the current fee categories from the regulations to a website.
However, APHIS is open to the consolidation or subdivision of fee
categories when aggregation or disaggregation of the services provided
is possible. These would be announced as part of the annual notice to
adjust the fees in future notices.
Conversely, several commenters noted that we divided several user
fee services into simple versus complex based on the number of hours
needed to complete them. The commenters appeared to assume that these
were new subcategories that the Agency would use in order to
artificially increase level of effort and charge more fees.
The terms existed in the regulations prior to the August 2023 final
rule and were simply ported from the regulations as a result of that
final rule. The terms still have the meaning that they had while part
of the regulations, and APHIS has no intent to change its practices to
artificially render the services complex. Additionally, as noted
elsewhere, fees were set based on average level of effort, in order to
control for outlying scenarios.
Several commenters asked why fees for services provided for their
class of animals or products were greater than the same service
provided for other classes of animals or products.
As noted in the November 2024 notice, the differing proposed
adjusted fees are the result of differing average levels of effort
needed to complete each service. The same service can take different
average levels of effort to complete for different classes of animal or
products. For example, the average level of effort associated with the
inspection of imported cattle differs from that associated with horses.
This can be the result of many factors, including, but not limited to
increased technical complexity associated with the task for a certain
class of animals or products, specialized requirements that must be met
and/or evaluated that are not applicable to other classes of animals or
products, and, particularly in the case of endorsement of export
certificates, extensive and non-standardized documentation and
attestations.
A commenter asked how the cost-of-living adjustment (COLA) and
consumer price index (CPI) percentages referenced in the November 2024
notice were calculated and stated that this was not explained
thoroughly in the notice. The manner in which COLA and CPI are
calculated for purposes of the user fee regulations was discussed at
length in October 2022 proposed rule to revise the regulations, and the
terms cost of living and Consumer price index are defined in the
regulations themselves.
The same commenter asserted that we needed to provide justification
in the November 2024 notice that COLA and CPI adjustments directly
impact direct and indirect costs to the Agency.
We disagree. The relationship was discussed in the October 2022
proposed rule to revise the regulations.
Although many commenters stated they understood the need for fee
increases in general, several commenters raised concerns regarding the
increase in user fees for their respective industries. Several
commenters noted that the notice provided cost calculation tables for
certain fees, but not for others, and asked that the final notice
provide the relevant cost calculations that led to each fee. Other
commenters stated that the data provided in the November 2024 notice
was insufficient to assess whether the proposed fee was justified and
asked for additional source data to evaluate the fee. Specific fee
classes that were flagged as needing additional information included
those for new and amended import permits, those for disease tests for
imported equines, those for inspection of horses intended for export,
those for export health certificates for bovine germplasm, and those
for endorsement of export health certificates.
We believe that the October 2022 proposed rule and the August 2023
final rule provided the cost components used to calculate each fee, as
well as the nature of the underlying Agency costs in each component.
The examples in the November 2024 notice were illustrative to show the
real costs in each component for various fee types.
However, in response to these requests and in the interest of full
transparency, we are making all cost data on which the fees were based
available at <a href="http://www.aphis.usda.gov/business-services/vs-fees">www.aphis.usda.gov/business-services/vs-fees</a>. Please note
that, due to the size of the files, they must be downloaded before
viewing.
A commenter noted that the notice did not address reimbursable
overtime rates, and provided comment on these rates. However, we stated
in the October 2022 proposed rule that reimbursable overtime would not
be part of the notice-based process under which the November 2024
notice was issued, but rather would be adjusted periodically through a
separate rulemaking process.
A commenter suggested that we amend the duration for which import
permits are valid. This is outside the scope of both this notice and
the user
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fee regulations under which this notice was issued.
A commenter suggested that APHIS not require permit amendments,
which are assessed a user fee, for import permits for equines when a
change of expected itinerary occurs. This likewise is outside the scope
of both this notice, and the user fee regulations under which this
notice was issued.
A commenter suggested that all export health certificates should be
electronically generated and filed.
To the extent that our trading partners allow this practice, we
will pursue it. However, we note that foreign nations are sovereign to
set their own import requirements for agricultural products, including
the form of export health certificates that they will accept.
A commenter referenced a 2024 United States Animal Health
Association (USAHA) resolution related to equine imports, and asked for
a comprehensive review report to be supplied to the industry related to
the Agency's use of personnel resources in order for the industry to be
able to evaluate the merits of the November 2024 notice.
The commenter is referring to Resolution 7 passed at the 2024
Annual USAHA conference, found here: <a href="https://usaha.org/wp-content/uploads/2024/12/2024-USAHA-Resolutions-7.pdf">https://usaha.org/wp-content/uploads/2024/12/2024-USAHA-Resolutions-7.pdf</a>. The resolution called for
``a comprehensive formal official review of all programs and units
involved in the international movement of equine and equid products,''
including a review of personnel resources, management protocols, policy
and procedure documents and protocols, international movement data, and
memoranda of understanding, derogations and waivers. This request
significantly exceeds the scope of this notice and is not necessary in
order to evaluate whether the fees have been calculated correctly. In
this regard, we are making all source data used to calculate the fees
publicly available in tandem with this final notice.
Comments Regarding Specific Costs and Fees
In our November 2024 notice, we indicated that factors leading to
the increase of the fees included increased level of effort and
expertise associated with providing different services. As an
illustrative example, we indicated that export health certificates had
historically been VS forms that allowed information to be presented in
a standardized way. However, in recent years, many countries have
changed their import requirements and now require country and species-
specific health certificates. We also noted that the certificates can
now vary widely in terms of the information they contain, the
requirements they cite, and the type of certificate that can be used.
We provided further that all export health certificates must now be
verified for each animal or shipment of product being exported. We
noted that all of these factors had increased the level of effort
needed to complete the work, and increased the need for subject matter
expertise to ensure the work addresses the additional complexities now
involved.
Several commenters stated that endorsement of export health
certificates for bovine germplasm had become more streamlined, rather
than more complex, and argued that fees should have gone down, rather
than risen, if based on the level of complexity.
Endorsement of export health certificates for bovine germplasm
falls within the larger category of endorsement of export health
certificates for animal products and is not disaggregated from
endorsements for export health certificates of other types of products,
for which level of effort and complexity has increased.
Additionally, we note that increased level of complexity was not
the sole factor leading to the increased fees. Rather, the fees were
set based on all cost components listed in the regulations, and all
cost components associated with the fees have increased since they were
last set.
Several commenters stated that subject matter expertise was not
specifically needed to endorse export health certificates for animal
products.
We disagree that subject matter expertise is not needed for the
endorsement of export certificates for animal products. Some of the
endorsements are lengthy in terms of documentation and highly complex.
Moreover, many countries specifically require endorsement by
individuals with a certain level of credentials, technical expertise,
and/or experience. While APHIS does attempt to ensure these are
actually required for the endorsements in question through trade
negotiations and the development of export protocols, as noted
previously, foreign countries are sovereign and may set their own
import requirements.
In our November 2024 notice, we stated that the total information
technology (IT) costs included in the update were $6,461,071.38 for
Import-Export to ensure funding is available as costs are actualized.
A commenter asked us what IT improvements had been budgeted in this
estimate, and how industry and APHIS would be able to use them.
The costs include not only development of new IT and equipment
costs, but also operation and maintenance costs, new information
technology and equipment costs. With that being said, projected
projects include:
<bullet> APHIS-VS Trade System Modernization design and
development, including live animal exports and imports, animal import
center reservations, and product import and export certificates and
facility inspections.
<bullet> Further development of APHIS' EFile system, which handles
APHIS' permitting processes.
<bullet> Further development and identified enhancements to APHIS'
Veterinary Export Health Certification System, also known as VEHCS.
<bullet> Design and development of the User Fee invoicing system.
A commenter asked why the fee for housing, care, feed, and handling
of miniature horses while in import-related quarantine was increasing
at a greater rate than the fee for similar services for non-miniature
equines. They also inquired why there is not a depreciation of the fee
for miniature horses for instances of prolonged care, as there is for
non-miniature equines.
As noted in the paragraphs below table B in the November 2024
notice, this is because the fee for such services for miniature horses
is based on an alternate fee structure for instances when there is no
identifiable volume in the previous year, when the fee is rarely
charged, or when APHIS cannot readily identify level of effort. In such
instances, we will calculate the fee based on the last available
historic data, including inflation, program, agency, department and
support costs, imputed costs, and reserve.
There is not a depreciation of the fee for instances of prolonged
care for miniature horses, as there is for non-miniature equines,
because there was not such a depreciation for miniature horses
previously in the regulations, as there was for non-miniature equines.
As noted previously, the August 2023 final rule did not amend the fee
categories, but, rather, moved the current fee categories from the
regulations to a website.
In the November 2024 notice, we proposed to increase the fees for
processing import permit applications.
Several commenters stated that import permits for their class of
animal or animal products and/or their exporting country were routine
and processing fees should not have
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increased to the extent that we proposed.
The processing of import permits is a service where disaggregation
based on the class of animal or animal product or the exporting country
in question is not possible. The fees were calculated based on the
average level of effort to complete the issuance of import permits.
Additionally, as a matter of transparency, we are making all cost data
on which the fees were based available at <a href="http://www.aphis.usda.gov/business-services/vs-fees">www.aphis.usda.gov/business-services/vs-fees</a>.
Therefore, in accordance with Sec. 130.3(a), we are updating the
fees as proposed and without modification.
Authority: 5 U.S.C. 5542; 7 U.S.C. 1622 and 8301-8317; 21 U.S.C.
136 and 136a; 31 U.S.C. 3701, 3716, 3717, 3719, and 3720A; 7 CFR 2.22,
2.80, and 371.4.
Done in Washington, DC, this 6th day of January 2025.
Donna Lalli,
Acting Administrator, Animal and Plant Health Inspection Service.
[FR Doc. 2025-00421 Filed 1-8-25; 8:45 am]
BILLING CODE 3410-34-P
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