[Federal Register Volume 68, Number 123 (Thursday, June 26, 2003)]
[Proposed Rules]
[Pages 37984-37986]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-16166]
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Proposed Rules
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains notices to the public of
the proposed issuance of rules and regulations. The purpose of these
notices is to give interested persons an opportunity to participate in
the rule making prior to the adoption of the final rules.
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Federal Register / Vol. 68, No. 123 / Thursday, June 26, 2003 /
Proposed Rules
[[Page 37984]]
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Parts 56 and 70
[Docket No. PY-03-001]
Increase in Fees and Charges for Egg, Poultry, and Rabbit Grading
AGENCY: Agricultural Marketing Service, USDA.
ACTION: Proposed rule.
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SUMMARY: The Agricultural Marketing Service (AMS) proposes to increase
the fees and charges for Federal voluntary egg, poultry, and rabbit
grading. These fees and charges need to be increased to cover the
increase in salaries of Federal employees, salary increases of State
employees cooperatively utilized in administering the programs, and
other increased Agency costs.
DATES: Comments must be received on or before July 28, 2003.
ADDRESSES: Send written comments to David Bowden, Jr., Chief,
Standardization Branch, Poultry Programs, Agricultural Marketing
Service, U.S. Department of Agriculture, STOP 0259, room 3944-South,
1400 Independence Avenue, SW, Washington, DC 20250. Comments may be
faxed to (202) 690-0941.
State that your comments refer to Docket No. PY-03-001 and note the
date and page number of this issue of the Federal Register.
Comments received may be inspected at the above location between 8
a.m. and 4:30 p.m., Eastern Time, Monday through Friday, except
holidays.
FOR FURTHER INFORMATION CONTACT: Rex A. Barnes, Chief, Grading Branch,
(202) 720-3271.
SUPPLEMENTARY INFORMATION:
Background and Proposed Changes
The Agricultural Marketing Act (AMA) of 1946 (7 U.S.C. 1621 et
seq.) authorizes official voluntary grading and certification on a
user-fee basis of eggs, poultry, and rabbits. The AMA provides that
reasonable fees be collected from users of the program services to
cover, as nearly as practicable, the costs of services rendered. The
AMS regularly reviews these programs to determine if fees are adequate
and if costs are reasonable.
A recent review determined that the existing fee schedule,
effective January 1, 2003, will not generate sufficient revenues to
cover program costs while maintaining an adequate reserve balance in FY
2004. Costs in FY 2004 are projected at $29.8 million. Without a fee
increase, FY 2004 revenues are projected at $29.0 million and trust
fund balances would be $14.6 million. With a fee increase, FY 2004
revenues are projected at $29.8 million and trust fund balances would
remain at $15.2 million.
Employee salaries and benefits account for approximately 82 percent
of the total operating budget. The last general and locality salary
increase for Federal employees became effective on January 1, 2003 and
it materially affected program costs. Projected cost estimates for that
increase were based on a salary increase of 2.6 percent, however, the
increase was actually 4.02 to 4.87 percent, depending on locality.
Another general and locality salary increase estimated at 2 percent is
expected in January 2004. Also, from October 2002 through September
2004, salaries and fringe benefits of federally-licensed State
employees will have increased by about 3 percent.
The impact of these cost increases was determined for resident,
nonresident, and fee services. To offset projected cost increases, the
hourly resident and nonresident rate would be increased by
approximately 3 percent and the fee rate would be increased by
approximately 4 percent. The hourly rate for resident and nonresident
service covers graders' salaries and benefits. The hourly rate for fee
service covers graders' salaries and benefits, plus the cost of travel
and supervision.
As shown in the table below, only the maximum monthly
administrative charge that covers overhead costs for resident poultry
and shell egg grading would be increased, while other administrative
charges would not be changed.
The following table compares current fees and charges with proposed
fees and charges for egg, poultry, and rabbit grading as found in 7 CFR
parts 56 and 70:
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Service Current Proposed
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Resident Service (egg, poultry, and rabbit grading)
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Inauguration of service..................................................... 310 310
Hourly charges: Regular hours............................................... 33.36 34.36
Administrative charges--Poultry grading:
Per pound of poultry.................................................... .00037 .00037
Minimum per month....................................................... 260 260
Maximum per month....................................................... 2,675 2,755
Administrative charges--Shell egg grading:
Per 30-dozen case of shell eggs......................................... .048 .048
Minimum per month....................................................... 260 260
Maximum per month....................................................... 2,675 2,755
Administrative charges--Rabbit grading: Based on 25% of grader's salary, 260 260
minimum per month..........................................................
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[[Page 37985]]
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Service Current Proposed
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Nonresident Service (egg and poultry grading)
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Hourly charges: Regular hours............................................... 33.36 34.36
Administrative charges: Based on 25% of grader's salary, minimum per month.. 260 260
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Fee and Appeal Service (egg, poultry, and rabbit grading)
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Hourly charges:
Regular hours........................................................... 57.68 60.00
Weekend and holiday hours............................................... 66.64 69.32
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Executive Order 12866
This action has been determined to be not significant for purposes
of Executive Order 12866 and has not been reviewed by the Office of
Management and Budget (OMB).
Regulatory Flexibility
Pursuant to the requirements set forth in the Regulatory
Flexibility Act (RFA)(5 U.S.C. 601 et seq.), the AMS has considered the
economic impact of this action on small entities. It is determined that
its provisions would not have a significant economic impact on a
substantial number of small entities.
There are about 400 users of Poultry Programs' grading services.
These official plants can pack eggs, poultry, and rabbits in packages
bearing the USDA grade shield when AMS graders are present to certify
that the products meet the grade requirements as labeled. Many of these
users are small entities under the criteria established by the Small
Business Administration (13 CFR 121.201). These entities are under no
obligation to use grading services as authorized under the Agricultural
Marketing Act of 1946.
The AMS regularly reviews its user fee financed programs to
determine if fees are adequate and if costs are reasonable. A recent
review determined that the existing fee schedule, effective January 1,
2003, will not generate sufficient revenues to cover program costs
while maintaining an adequate reserve balance in FY 2004. Costs in FY
2004 are projected at $29.8 million. Without a fee increase, FY 2004
revenues are projected at $29.0 million and trust fund balances would
be $14.6 million. With a fee increase, FY 2004 revenues are projected
at $29.8 million and trust fund balances would remain at $15.2 million.
This action would raise the fees charged to users of grading
services. The AMS estimates that overall, this rule would yield an
additional $800,000 during FY 2004. The hourly rate for resident and
nonresident service would increase by approximately 3 percent and the
fee rate would increase by approximately 4 percent. The impact of these
rate changes in a poultry plant would range from less than 0.0001 to
0.025 cents per pound of poultry handled. In a shell egg plant, the
range would be less than 0.00002 to 0.11 cents per dozen eggs handled.
Civil Justice Reform
This action has been reviewed under Executive Order 12988, Civil
Justice Reform. This action is not intended to have retroactive effect.
This rule will not preempt any State or local laws, regulations, or
policies, unless they present an irreconcilable conflict with this
rule. There are no administrative procedures which must be exhausted
prior to any judicial challenge to the provisions of this rule.
Paperwork Reduction
The information collection requirements that appear in the sections
to be amended by this action have been previously approved by OMB and
assigned OMB Control Numbers under the Paperwork Reduction Act (44
U.S.C. Chapter 35) as follows: Sec. 56.52(a)(4)--No. 0581-0128; and
Sec. 70.77(a)(4)--No. 0581-0127.
A 30-day comment period is provided for interested persons to
comment on this proposed rule. This period is appropriate in order to
implement, as early as possible in FY 2004, any fee changes adopted as
a result of this rulemaking action.
List of Subjects
7 CFR Part 56
Eggs and egg products, Food grades and standards, Food labeling,
Reporting and recordkeeping requirements.
7 CFR Part 70
Food grades and standards, Food labeling, Poultry and poultry
products, Rabbits and rabbit products, Reporting and recordkeeping
requirements.
For reasons set forth in the preamble, it is proposed that Title 7,
Code of Federal Regulations, parts 56 and 70 be amended as follows:
PART 56--GRADING OF SHELL EGGS
1. The authority citation for part 56 continues to read as follows:
Authority: 7 U.S.C. 1621-1627.
2. Section 56.46 is revised to read as follows:
Sec. 56.46 On a fee basis.
(a) Unless otherwise provided in this part, the fees to be charged
and collected for any service performed, in accordance with this part,
on a fee basis shall be based on the applicable rates specified in this
section.
(b) Fees for grading services will be based on the time required to
perform the services. The hourly charge shall be $60.00 and shall
include the time actually required to perform the grading, waiting
time, travel time, and any clerical costs involved in issuing a
certificate.
(c) Grading services rendered on Saturdays, Sundays, or legal
holidays shall be charged for at the rate of $69.32 per hour.
Information on legal holidays is available from the Supervisor.
3. In Sec. 56.52, paragraph (a)(4) is revised to read as follows:
Sec. 56.52 Continuous grading performed on resident basis.
* * * * *
(a) * * *
(4) An administrative service charge based upon the aggregate
number of 30-dozen cases of all shell eggs handled in the plant per
billing period multiplied by $0.048, except that the minimum charge per
billing period shall be $260 and the maximum charge shall be $2,755.
The minimum charge also applies where an approved application is in
effect and no product is handled.
PART 70--VOLUNTARY GRADING OF POULTRY PRODUCTS AND RABBIT PRODUCTS
4. The authority citation for part 70 continues to read as follows:
Authority: 7 U.S.C. 1621-1627.
5. Section 70.71 is revised to read as follows:
[[Page 37986]]
Sec. 70.71 On a fee basis.
(a) Unless otherwise provided in this part, the fees to be charged
and collected for any service performed, in accordance with this part,
on a fee basis shall be based on the applicable rates specified in this
section.
(b) Fees for grading services will be based on the time required to
perform such services for class, quality, quantity (weight test), or
condition, whether ready-to-cook poultry, ready-to-cook rabbits, or
specified poultry food products are involved. The hourly charge shall
be $60.00 and shall include the time actually required to perform the
work, waiting time, travel time, and any clerical costs involved in
issuing a certificate.
(c) Grading services rendered on Saturdays, Sundays, or legal
holidays shall be charged for at the rate of $69.32 per hour.
Information on legal holidays is available from the Supervisor.
6. In Sec. 70.77, paragraph (a)(4) is revised to read as follows:
Sec. 70.77 Charges for continuous poultry or rabbit grading performed
on a resident basis.
* * * * *
(a) * * *
(4) For poultry grading: An administrative service charge based
upon the aggregate weight of the total volume of all live and ready-to-
cook poultry handled in the plant per billing period computed in
accordance with the following: Total pounds per billing period
multiplied by $0.00037, except that the minimum charge per billing
period shall be $260 and the maximum charge shall be $2,755. The
minimum charge also applies where an approved application is in effect
and no product is handled.
* * * * *
Dated: June 23, 2003.
A.J. Yates,
Administrator, Agricultural Marketing Service.
[FR Doc. 03-16166 Filed 6-25-03; 8:45 am]
BILLING CODE 3410-02-P