[Federal Register Volume 72, Number 103 (Wednesday, May 30, 2007)]
[Rules and Regulations]
[Pages 29851-29874]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-10371]


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DEPARTMENT OF HOMELAND SECURITY

8 CFR Part 103

[Docket No. USCIS-2006-0044; CIS No. 2393-06]
RIN 1615-AB53


Adjustment of the Immigration and Naturalization Benefit 
Application and Petition Fee Schedule

AGENCY: United States Citizenship and Immigration Services, DHS.

ACTION: Final rule.

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SUMMARY: This rule adjusts the fee schedule for U.S. Citizenship and 
Immigration Services (USCIS) immigration and naturalization benefit 
applications and petitions, including nonimmigrant applications and 
visa petitions. These fees fund the cost of processing applications and 
petitions for immigration benefits and services, and USCIS' associated 
operating costs. USCIS is revising these fees because the current fee 
schedule does not adequately reflect current USCIS processes or recover 
the full costs of services provided by USCIS. Without an immediate 
adjustment of the fee schedule, USCIS cannot provide adequate capacity 
to process all applications and petitions in a timely and efficient 
manner. In addition, the revised fees will eliminate USCIS' dependency 
on revenue from interim benefits, temporary programs, and premium 
processing fees. This rule also merges fees for certain applications 
and petitions so applicants and petitioners will only have to pay a 
single fee. In addition, the rule expands the classes of aliens that 
will be exempt from paying filing fees for certain immigration 
benefits, and modifies the criteria for waiving the filing fee due to 
an individual's inability to pay. Based on comments received by USCIS 
during the public comment period, this rule changes the fees for 
adjustment of status applications, and the fee waiver and exemption 
eligibility criteria for several immigration benefits. This final rule 
will provide sufficient funding for USCIS to meet national security, 
customer service, and processing time goals, and to sustain and improve 
service delivery.

[[Page 29852]]


DATES: This rule is effective July 30, 2007. Applications or petitions 
mailed, postmarked, or otherwise filed, on or after July 30, 2007 must 
include the new fee.

FOR FURTHER INFORMATION CONTACT: Paul Schlesinger, Chief, Budget 
Division, Office of Planning, Budget and Finance, United States 
Citizenship and Immigration Services, Department of Homeland Security, 
20 Massachusetts Avenue, NW., Suite 4052, Washington, DC 20529, 
telephone (202) 272-1930.

SUPPLEMENTARY INFORMATION:

Table of Contents

I. Background
II. Final Rule
    A. Application To Register Permanent Residence or Adjust Status
    B. Intercountry Adoptions
    C. Fee Waivers and Exemptions
    D. Miscellaneous Changes and Corrections
    E. Summary of Final Fees
III. Public Comments on the Proposed Rule
    A. General Comments
    B. Relative Amount of Fees
    1. Recovery of Additional Costs and Enhancements
    2. Proposed Fees Are Unreasonably High
    3. Improve Service, Reduce Inefficiencies
    4. Increases Relative to Time
    5. Increases Relative to Other Standards
    6. Grandfathering
    7. Budget Decisions Necessary To Administer Immigration Benefits
    8. Reorganization
    C. Alternative Sources of Funding
    1. Appropriated Funds
    2. Finding Other Revenue Sources
    D. Comments on Specific Benefit Application and Petition Fees
    1. Naturalization Application
    2. Application To Register Permanent Residence or Adjust Status
    3. Employment Authorization for Students
    4. Application for Advance Processing of Orphan Petition
    5. Entrepreneurs
    6. Effect on Availability of Skilled Workers
    E. Fee Waivers and Exemptions
    1. Victims and Asylee Adjustment of Status Applications
    2. Special Immigrant--Juvenile
    3. Biometric Fee
    F. Authority To Set and Collect Fees
    1. Authority Under the INA
    2. General Authority for Charging Fees
    3. Surcharge for Asylum, Refugee and Fee Waiver/Exemption Costs
    4. OMB Circular A-25
    5. Homeland Security Act
    G. Methods Used To Determine Fee Amounts
    1. USCIS Costs
    2. Alternative Budget Modeling
    3. ``Make Determination'' Activity
    4. Activity-Based Costing
    5. Calculating Specific Processing Requirements
    6. Overhead Charges
    7. Recovering Deficit From Current Operations
    8. Charging a Flat Fee
    9. Financial Audits
    10. Acceptance of Electronic Payment options
    11. Other USCIS Fees
IV. Statutory and Regulatory Reviews
    A. Regulatory Flexibility Act
    B. Unfunded Mandates Reform Act of 1995
    C. Small Business Regulatory Enforcement Fairness Act of 1996
    D. Executive Order 12866
    E. Executive Order 13132
    F. Executive Order 12988
    G. Paperwork Reduction Act

List of Acronyms and Abbreviations

ABC--Activity-Based Costing
BSS--Biometrics Storage System
CBP--United States Customs and Border Protection
DHS--Department of Homeland Security
EAD--Employment Authorization Document
FBI--Federal Bureau of Investigation
FDNS--Fraud Detection and National Security
FY--Fiscal Year
GAO--Government Accountability Office
GDP--Gross Domestic Product
HSA--Homeland Security Act
ICE--United States Immigration and Customs Enforcement
IEFA--Immigration Examinations Fee Account
INA--Immigration and Nationality Act
INS--Immigration and Naturalization Service
IOAA--Independent Offices Appropriation Act
LPR--Lawful Permanent Resident
OIG--Office of Inspector General
OMB--Office of Management & Budget
OPT--Optional Practical Training
PPBS--Planning Programming Budgeting System
SSA--Social Security Administration
TPS--Temporary Protected Status
USCIS--United States Citizenship and Immigration Services
VAWA--Violence Against Women Act
ZBB--Zero Based Budget

I. Background

    On February 1, 2007, U.S. Citizenship and Immigration Services 
(USCIS) published a notice of proposed rulemaking proposing to adjust 
USCIS' immigration and naturalization benefit fee schedule. 72 FR 4888. 
USCIS' current fee schedule does not establish a level of funding 
sufficient to fully fund USCIS operations, allow for future 
requirements, ensure adequate staffing, or provide USCIS with funding 
sufficient for technological capabilities to continue or improve timely 
and efficient processing of immigration benefits. The fees that fund 
the IEFA were last updated on October 26, 2005, but merely to adjust 
the existing fee schedule to reflect inflation. See 70 FR 56182 (Sept. 
26, 2005). The last comprehensive fee review was conducted in fiscal 
year 1998 by the Immigration and Naturalization Service (INS). See 63 
FR 1775 (Jan. 12, 1998) (proposed rule); 63 FR 43604 (Aug. 14, 1998) 
(final rule fee adjustment).
    In 2004, the Government Accountability Office (GAO) reported that 
the fees collected by USCIS were insufficient to fund USCIS operations. 
GAO, Immigration Application Fees: Current Fees are Not Sufficient to 
Fund U.S. Citizenship and Immigration Services' Operations (GAO-04-
309R, Jan. 5, 2004). GAO recommended that USCIS ``perform a 
comprehensive fee study to determine the costs to process new 
immigration applications.'' Id. at 3. In response to GAO's 
recommendations, USCIS undertook a comprehensive fee review to revise 
its application and petition fees to ensure full recovery of its 
operational costs.
    As discussed in the proposed rule, the Immigration and Nationality 
Act of 1952 (INA), as amended, provides for the collection of fees at a 
level that will ensure recovery of the full costs of providing 
adjudication and naturalization services, including the costs of 
providing similar services without charge to asylum applicants and 
certain other immigrants. INA section 286(m), 8 U.S.C. 1356(m). The INA 
also states that the fees may recover administrative costs as well. Id. 
The fee revenue collected under INA section 286(m) remains available to 
provide immigration and naturalization benefits and the collection of, 
safeguarding of, and accounting for fees. INA section 286(n), 8 U.S.C. 
1356(n).
    USCIS must also conform to the requirements of the Chief Financial 
Officers Act of 1990 (CFO Act), 31 U.S.C. 901-03. The CFO Act 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 costs incurred by 
it in providing those services and things of value.'' Id. at 902(a)(8). 
This final rule reflects recommendations made by the DHS CFO and USCIS 
CFO as required under the CFO Act.
    Office of Management and Budget (OMB) Circular A-25 establishes 
Federal policy regarding fees assessed for Government services and the 
basis upon which federal agencies set user charges sufficient to 
recover the full cost to the Federal Government. OMB Circular A-25, 
User Charges (Revised), section 6, 58 FR 38142 (July 15, 1993) (OMB 
Circular A-25). Under OMB Circular A-25, the objective of the United 
States Government is to ensure that it recovers the full costs of 
providing specific services to users. Full

[[Page 29853]]

costs include, but are not limited to, an appropriate share of--
    (a) Direct and indirect personnel costs, including salaries and 
fringe benefits such as medical insurance and retirement;
    (b) Physical overhead, consulting, and other indirect costs, 
including material and supply costs, utilities, insurance, travel and 
rents or imputed rents on land, buildings, and equipment; and,
    (c) Management and supervisory costs.
    Full costs are determined based upon the best available records of 
the agency. Id; see also OMB Circular A-11, section 31.12 (June 30, 
2006) (Fiscal Year (FY) 2008 budget formulation and execution policy 
regarding user fees), found at http://www.whitehouse.gov/omb/circulars/
a11/current_year/a11_toc.html. When developing fees for services, 
USCIS also looks to the Federal Accounting Standards Advisory Board 
(FASAB) which defines ``full cost'' to include ``direct and indirect 
costs that contribute to the output, regardless of funding sources.'' 
Federal Accounting Standards Advisory Board, Statement of Financial 
Accounting Standards No. 4: Managerial Cost Accounting Concepts and 
Standards for the Federal Government 36 (July 31, 1995). To obtain full 
cost, FASAB identifies various classifications of costs to be included, 
and recommends various methods of cost assignment. Id. at 33-42.
    USCIS entered supporting fee review documentation for this 
rulemaking and its methodology, including budget methodology analyses 
and regulatory flexibility analyses, into the public docket. See http:/
/www.regulations.gov, docket number USCIS-2006-0044. A more detailed 
discussion of USCIS' fee review can be found in the proposed rule for 
this rulemaking action at 72 FR 4888.

II. Final Rule

    This fee rule sets out fees to recover the full costs of USCIS 
operations. Without these fee adjustments, USCIS will not be able to 
maintain critical business functions, properly address fraud and 
national security issues, or process incoming applications and 
petitions in a timely manner. The revised fee schedule will close 
existing funding gaps and allow USCIS to take specific and demonstrable 
steps to strengthen the security and integrity of the immigration 
system, improve customer service, and modernize business operations. 
The fee revenue generated by the revised fee schedule will support 
increased security and fundamentally transform and automate USCIS 
business operations, all of which will greatly strengthen the ability 
of USCIS to perform its mission and place USCIS in a better position to 
support possible future legislative reforms. This fee rule assumes that 
no new appropriation will be enacted.
    This final rule largely implements the fee structure described in 
the proposed rule, but makes some adjustments to the fee schedule based 
on public comments received. This rule also expands the proposed fee 
waiver policy to include additional classes of applicants and 
petitioners who may apply for a waiver of certain application and 
petition fees for certain services. The rationale for each change is 
discussed in the section of the rule that discusses comments on that 
issue. The specific changes made are summarized as follows.

A. Application To Register Permanent Residence or Adjust Status

    In the proposed rule, the proposed fee of $905 for an Application 
to Register Permanent Residence or Adjust Status, Form I-485, was based 
on USCIS' projected overall cost of processing the average application, 
regardless of the applicant's age. Under the final rule, the standard 
fee for filing a Form I-485 by an individual will be $930; the fee for 
a child under the age of fourteen years will be $600 when submitted 
concurrently for adjudication with the application of a parent under 
sections 201(b)(A)(i), 203(a)(2)(A), or 203(d) of the INA. The comments 
received on this issue and the rationale for making this change are 
discussed in section III.D.2 below.

B. Intercountry Adoptions

    In the proposed rule, the proposed fee of $670 for filing an 
Application for Advance Processing of Orphan Petition, Form I-600A, was 
based on USCIS' projected overall cost of processing the average 
application. This final rule does not change that proposed fee, 
retaining it at $670. However, the final rule provides that the first 
request for extension of the approval of an Application for Advance 
Processing of Orphan Petition will be accepted without a fee if the 
request is filed in advance of the expiration of the Notice of 
Favorable Determination Concerning Application for Advance Processing 
of Orphan Petition, Form I-171H, and no Petition to Classify Orphan as 
Immediate Relative, Form I-600, has been filed with USCIS for 
adjudication. This no charge extension is limited to only one occasion. 
A complete application and fee must be submitted for any subsequent 
application.
    This final rule also provides that no biometric fee will be charged 
for an update of an approved Application for Advance Processing of 
Orphan Petition. Section III.D.4. below discusses the comments received 
in this area and the reasons for making this change.

C. Fee Waivers and Exemptions

    The final rule alters the proposed rule regarding fee waivers in 
three important ways:
     It permits an application for a fee waiver for the 
Application for Adjustment of Status from asylees, victims of human 
trafficking (T visas), victims of violent crime (U visas), and Violence 
Against Women Act (VAWA) self petitioners, and Special Immigrant--
Juveniles.
     It provides that a ``Special Immigrant--Juvenile'' will 
not be charged a fee for submitting the Petition for Amerasian, 
Widow(er), or Special Immigrant, Form I-360.
     It permits an application for fee waiver of the biometric 
fee.
    These three changes represent a significant expansion of the fee 
waiver policy from what was proposed and will ensure that many 
applicants or petitioners, who may have faced financial hardship as a 
result of these fees, may now have that hardship alleviated. Section 
III.E. below discusses these changes and the comments received in this 
area more fully.

D. Miscellaneous Changes and Corrections

    The final rule makes a few clarifying changes to the regulatory 
text in the proposed rule. First, as a result of a comment, USCIS found 
that the fee schedule contained a form that was no longer being used. 
As a result, references to the entry for Application for Change of 
Nonimmigrant Classification, Form I-506, are removed by this rule. 
Second, the explanation of the fee for a Motion, Form I-290B, was found 
to be outdated in that the section had not been updated to comport with 
changes that had been made to 8 CFR part 242 and 8 CFR 1003.8. This 
rule also clarifies that fee to reflect current procedures and policies 
and the applicability of the Motion fee. Finally, the maximum fee 
proposed for Application to Adjust Status from Temporary to Permanent 
Resident (Under Section 245A of Public Law 99-603),\1\ Form I-698, and 
Application for Status as a Temporary Resident under Section 245A of 
the Immigration and

[[Page 29854]]

Nationality Act, Form I-687, to be paid by a family with children under 
eighteen years of age living at home was removed from the final rule. 
The statutory eligibility requirements for adjustment of status under 
Public Law 99-603 preclude anyone who is currently under age eighteen 
from eligibility. Accordingly, that provision was obsolete.
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    \1\ Immigration Reform and Control Act of 1986, Public Law 99-
603, tit. II, sec. 201, 100 Stat. 3359, 3394 (Nov. 6, 1986).
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E. Summary of Final Fees

    The USCIS Immigration and Naturalization Benefit Application and 
Petition Fee Schedule, the proposed fees, and the final fees 
established by this rule are summarized in the attached table.

----------------------------------------------------------------------------------------------------------------
                                                                             Current      Proposed
               Form No.                            Description                 fees         fees      Final fees
----------------------------------------------------------------------------------------------------------------
I-90..................................  Application to Replace Permanent          $190         $290         $290
                                         Resident Card.
I-102.................................  Application for Replacement/               160          320          320
                                         Initial Non-immigrant Arrival-
                                         Departure Record (I-94).
I-129.................................  Petitions for a Nonimmigrant               190          320          320
                                         Worker.
I-129F................................  Petition for Alien                         170          455          455
                                         Fianc[eacute](e).
I-130.................................  Petition for Alien Relative......          190          355          355
I-131.................................  Application for Travel Document..          170          305          305
I-140.................................  Immigrant Petition for Alien               195          475          475
                                         Worker.
I-191.................................  Application for Advance                    265          545          545
                                         Permission to Return to
                                         Unrelinquished Domicile.
I-192.................................  Application for Advance                    265          545          545
                                         Permission to Enter As a
                                         Nonimmigrant.
I-193.................................  Application for Waiver of                  265          545          545
                                         Passport and/or Visa.
I-212.................................  Application for Permission to              265          545          545
                                         Reapply for Admission into the
                                         United States After Deportation
                                         or Removal.
I-360.................................  Petition for Amerasian,                    190          375          375
                                         Widow(er), or Special Immigrant.
I-485.................................  Application to Register Permanent          325          905          930
                                         Residence or Adjust Status.
I-526.................................  Immigrant Petition by Alien                480        1,435        1,435
                                         Entrepreneur.
I-539.................................  Application to Extend/Change               200          300          300
                                         Nonimmigrant Status.
I-600/I-600A..........................  Petition to Classify Orphan as an          545          670          670
                                         Immediate Relative/Application
                                         for Advance Processing or Orphan
                                         Petition.
I-601.................................  Application for Waiver of Grounds          265          545          545
                                         of Inadmissibility.
I-612.................................  Application for Waiver of the              265          545          545
                                         Foreign Residence Requirement.
I-687.................................  For Filing Application for Status          255          710          710
                                         as a Temporary Resident.
I-690.................................  Application for Waiver of                   95          185          185
                                         Excludability.
I-694.................................  Notice of Appeal of Decision.....          110          545          545
I-695.................................  Application for Replacement                 65          130          130
                                         Employment Authorization or
                                         Temporary Residence Card.
I-698.................................  Application to Adjust Status from          180        1,370        1,370
                                         Temporary to Permanent Resident.
I-751.................................  Petition to Remove Conditions on           205          465          465
                                         Residence.
I-765.................................  Application for Employment                 180          340          340
                                         Authorization.
I-817.................................  Application for Family Unity               200          440          440
                                         Benefits.
I-824.................................  Application for Action on an               200          340          340
                                         Approved Application or Petition.
I-829.................................  Petition by Entrepreneur to                475        2,850        2,850
                                         Remove Conditions on Residence.
I-881.................................  NACARA--Suspension of Deportation          285          285          285
                                         or Application for Special Rule
                                         Cancellation of Removal.
I-914.................................  Application for T Nonimmigrant             270            0            0
                                         Status.
N-300.................................  Application to File Declaration            120          235          235
                                         of Intention.
N-336.................................  Request for Hearing on a Decision          265          605          605
                                         in Naturalization Procedures.
N-400.................................  Application for Naturalization...          330          595          595
N-470.................................  Application to Preserve Residence          155          305          305
                                         for Naturalization Purposes.
N-565.................................  Application for Replacement of             220          380          380
                                         Naturalization Citizenship
                                         Document.
N-600.................................  Application for Certification of           255          460          460
                                         Citizenship.
N-600K................................  Application for Citizenship and            255          460          460
                                         Issuance of Certificate under
                                         Section 322.
                                        Biometric Services...............           70           80           80
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III. Public Comments on the Proposed Rule

    USCIS provided a 60-day comment period in the proposed rule and 
received more than 3,900 comments.\2\ USCIS received comments from a 
broad spectrum of individuals and organizations, including refugee and 
immigrant service and advocacy organizations, public policy and 
advocacy groups, State and local governmental entities, educational and 
other not for profit institutions, labor organizations, corporations, 
and individuals. Many comments addressed multiple issues. USCIS 
received hundreds of comments through many distinct form letters and 
mass mailings that were identical or nearly identical in content. Many 
comments provided variations on the same substantive issues.
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    \2\ All comments may be reviewed at the Federal Docket 
Management System (FDMS) at www.regualtions.gov, docket number 
USCIS-2006-0044. The public may also review the docket upon request 
by contacting USCIS through the contact information listed in this 
rule. [0]
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    The comments ranged from strongly supportive of the increased fees 
to strongly critical. Many comments provided critiques of the 
methodology and the proposed fee schedule; some suggested alternative 
methods and funding sources.
    USCIS also invited the public to access the commercial software 
utilized in executing the budget methodology and developing the 
proposed rule to facilitate public understanding of the fee modeling 
process explained in the supporting documentation. 72 FR 4889. USCIS 
received no requests for such access to the modeling program.
    On February 14, 2007, the House Committee on the Judiciary, 
Subcommittee on Immigration, Citizenship, Refugees, Border Security,

[[Page 29855]]

and Immigration Law heard testimony from the USCIS Director on the fee 
proposal during the public comment period. USCIS has included an 
unofficial transcript of that hearing in the docket. See, Proposal to 
Adjust the Immigration Benefit Application and Petition Fee Schedule, 
110th Congress, 1st Sess. (Feb. 14, 2007).
    USCIS leadership met with stakeholders and conducted ``question and 
answer'' sessions during the public comment period at various cities 
throughout the United States, including: Washington, DC.; Los Angeles, 
California; New York, New York; Chicago, Illinois; Detroit, Michigan; 
Boston, Massachusetts; San Francisco, California; San Jose, California; 
Dallas, Texas; Phoenix, Arizona; and Denver, Colorado. Participants 
were encouraged to submit written comments on the rule.
    USCIS considered the comments received, the congressional hearing 
transcript, the content of the public meetings, and all other materials 
contained in the docket in preparing this final rule. Throughout the 
comment period, USCIS conducted a ``rolling'' review process. Comments 
were reviewed as soon as practical after receipt and re-reviewed in 
light of subsequent comments. The review process was very resource 
intensive and it permitted USCIS to develop a continuous understanding 
of the issues presented and maturation of consideration of the issues 
most commonly presented.
    A number of comments were not relevant to the substance of the 
proposed rule and criticized the rule for not addressing other 
immigration law issues. Many commenters suggested changes in the 
substantive regulations implementing the immigration laws by USCIS, 
United States Customs and Border Protection (CBP), United States 
Immigration and Customs Enforcement (ICE), and other agencies. These 
comments are beyond the scope of this rulemaking.
    The final rule does not address comments seeking changes in United 
States statutes, changes in regulations or applications and petitions 
unrelated to or not addressed by the proposed rule, changes in 
procedures of other components within the Department of Homeland 
Security (DHS) or other agencies, or the resolution of any other issues 
not within the scope of the rulemaking or the authority of DHS.
    The public may also review any item in the docket upon request by 
contacting USCIS through the contact information listed in this rule.

A. General Comments

    Numerous comments supported the rule, although many of those were 
qualified by expectations that the fee increase will result in better 
service. Many of these comments emphasized that the costly delays in 
case processing are far more expensive to applicants and petitioners 
than the cost of the discrete filing fee. Others emphasized that filing 
fees are often a small portion of the total cost incurred by an 
individual or family immigrating to the United States.
    In addition, many comments criticized the level of fees and the 
amount of the fee increase. A significant number of comments criticized 
the proposed fee schedule, suggested that the fee increase would impede 
immigration, or argued that specific fees should not be increased at 
all or not by the amount proposed. Many commenters disagreed with the 
budget decision to fund USCIS entirely from fees and argued that USCIS 
should seek an appropriation from Congress.

B. Relative Amount of Fees

    A significant number of commenters argued that the proposed fees 
were too low. Some expressed general concerns about immigration levels. 
Others argued that fees should be high enough to cover all immigration 
related costs, not simply application and petition processing and 
related USCIS costs, so taxpayers are not asked to pay for someone 
entering, residing, or seeking services in the United States.
1. Recovery of Additional Costs and Enhancements
    Many comments suggested that even greater increases could be used 
to further improve customer service, stating that this result would 
reduce the perceived need for an individual to seek the assistance of 
an attorney to understand and navigate the immigration benefits 
application and petition process. Other comments suggested that fees 
should not be based on USCIS' costs of administration, but on the value 
of the benefit received by the applicant (e.g., United States 
citizenship). Additionally, some comments pointed out that many aliens 
make large payments to those who help them enter the United States 
illegally, suggesting that this demonstrated the willingness to pay 
more to enter and remain in this country legally or illegally.
    Some comments supporting the proposed fees, or even higher 
increases, asserted that the fee increases are not significant when 
viewed in a broader context. Some cited the value of naturalization 
relative to the cost. Others noted that most people must be permanent 
residents for five years before they can apply for United States 
citizenship and the proposed fee requires saving less than $10 per 
month toward that goal. Other examples were also cited, including the 
fact that the fee for a petition for a relative, fianc[eacute], or 
orphan is a very small part of the total cost of bringing that person 
to the United States.
    The filing fees proposed and established under this rule are 
significantly higher than applicants and petitioners pay today. These 
fees, however, are based only on the costs associated with adjudicating 
applications.
    Several comments suggested that the fee increases were overdue and 
should have been implemented long ago. These commenters agreed with the 
proposed rule that the fee increases were necessary to increase the 
effectiveness of USCIS services. They recommended quick implementation 
of this rule so USCIS could begin making the planned improvements to 
its operations as soon as possible. As stated in the proposed rule, the 
current fee schedule does not generate enough revenue for USCIS to even 
process the current volumes of applications and petitions in a timely 
manner. As the Director of USCIS stated in his testimony before 
Congress on February 14, 2007, USCIS intends to implement this fee 
increase in the summer of 2007 so that it can begin its efforts to 
reduce average application processing times. This plan was also stated 
in the USCIS press release of January 31, 2007. USCIS plans to begin 
collecting these new fees in order to begin fully recovering its costs 
and obtaining the resources necessary to timely process applications. 
Thus, the commenters' suggestions are being recognized, but they are in 
line with original plans of USCIS.
    Specific comments suggested that the application fee for a Petition 
for a Nonimmigrant Worker, Form I-129 (Nonimmigrant Worker Petition), 
which is filed by businesses seeking to allow aliens to work in the 
United States, should be increased. According to these comments, higher 
fees should offset or alleviate the stress that these workers placed on 
the infrastructure of the United States, increased demand for 
governmental services, impact on the American labor market, reduced 
opportunities for citizens, and lowered salaries for American workers. 
Similarly, some comments suggested that a portion of fees should 
reimburse States for providing job training programs.

[[Page 29856]]

    Although a number of comments suggested that USCIS increase fees 
further it is important to note that the purpose of filing fees is to 
only recover the costs associated with providing a benefit or service. 
Filing fees are not designed to function like tariffs and generate 
general revenue to support broader policy decisions, or like fines to 
deter certain behaviors. The filing fees are not intended to influence 
public policy in favor of or in opposition to immigration, limit 
immigration, support broader infrastructure, or impact costs beyond 
USCIS.
    Other comments suggested that increasing specific fees, such as for 
an Application to Extend/Change Nonimmigrant Status, Form I-539, would 
serve as a deterrent to reinstatement applications and, instead, cause 
more aliens to remain in the United States longer than their period of 
authorized stay.
    USCIS considered these suggestions and others and in some cases, 
discussed further in this rule, made changes in response to public 
comments. These changes though continue to follow the President's FY 
2007 Budget which called for USCIS to reform its fee structure, and the 
GAO recommendation that USCIS ``perform a comprehensive fee review to 
determine the costs to process new immigration applications.'' This 
rule is designed to establish fees sufficient to reimburse the full, 
necessary, ongoing, and projected costs of processing immigration 
benefit applications and petitions and the related operating costs of 
USCIS.
    While USCIS has authority to collect fees for certain broader costs 
of administering the United States' immigration system, it has chosen 
to structure the fees to only recover the full cost of operating USCIS. 
USCIS believes that this decision is the most consistent with broader 
Administration policy on user fees and the intent of Congress in the 
enactment of, and amendments to, section 286(m) of the Immigration and 
Nationality Act (INA), 8 U.S.C. 1356(m). Accordingly, USCIS has not 
changed fees based on these comments.
2. Proposed Fees Are Unreasonably High
    The largest number of comments opposed the proposed fee increases 
in general terms or highlighted particular applications and petitions 
and argued that the proposed fee increases would effectively exclude 
aliens generally, or groups of aliens, from immigration benefits and 
services. Some suggested that fee increases send the wrong message to 
people who are attempting to comply with the immigration benefit 
process and United States immigration laws in good faith, and that 
higher fees may discourage legal immigration while encouraging aliens 
to attempt to enter the United States and work illegally. These 
comments reflect another specific position on the larger issues of 
immigration law and policy that aliens should be induced to immigrate 
to the United States. As noted above in relation to the opposite 
position, the purpose of the fee schedule is not to establish policy, 
but to recover the costs necessary to operate USCIS. Accordingly, the 
final rule does not adjust the fee schedule in response to these 
comments.
    A portion of these comments argued that the fee increases would 
result in a decrease in applications and petitions. Contrary to the 
opinions expressed, USCIS records do not reflect any empirical evidence 
suggesting a long-term reduction in the demand for immigration benefits 
resulting from fee increases. While fees at an extremely high level 
could be a factor in whether or not someone files an application with 
USCIS, neither past fee increases nor the incremental increases in this 
rule begin to approach the level necessary to have any significant 
impact on the demand for USCIS benefits. USCIS acknowledges that short-
term increases in applications and petitions occur after a fee increase 
has been announced, followed by short-term decreases in demand 
immediately after the fee increases become effective. This fluctuation 
is a normal result of an increase in the cost of any service, whether 
governmental or private. Generally, applicants and petitioners with the 
ability to file do so before fees increase. Individuals logically 
choose to pay a lower price for a service if and when available. 
However, USCIS records indicate that demand returns to normal shortly 
after the effective date of a fee increase. When the Immigration and 
Naturalization Service (INS) conducted the last comprehensive fee 
review in FY 1998 and fees increased, on an average percentage basis, 
more than they increase in this rule, the demand for immigration 
benefits remained fairly constant shortly thereafter. In any case, 
USCIS fees are generally believed to be only a portion of the total 
expenses incurred by a typical applicant.
    These comments infer that these temporary fluctuations undercut the 
stability of the funding stream to be generated by the proposed fees. 
USCIS acknowledges that slight fluctuations will occur and will be 
reflected in the funding stream, but these fluctuations are not 
significant enough, in the context of the overall USCIS budget, to 
adversely affect services.
3. Improve Service, Reduce Inefficiencies
    a. Service improvement and fees.
    Many comments noted lengthy waiting times to process immigration 
benefit applications and petitions and highlighted the need to improve 
overall customer service. These comments suggested that, regardless of 
whether the proposed fees were justified, applicants and petitioners 
should not be asked to pay the full fee increase until USCIS improves 
service. Others suggested that even if fees were increased before 
service level improvements were made, there should be detailed 
commitments to service level improvements to ensure that increased 
revenues are used to improve service.
    Some comments stated that USCIS has increased fees before with the 
promise of enhanced services, but never fully delivered on that 
promise. Other comments indicated that the proposed rule does not 
outline an overall strategic plan for improvements, with measurable 
benchmarks and tangible goals for implementing the needed upgrades, or 
a specific timeline or completion schedule to assure interested parties 
that these improvements will actually be accomplished. One commenter 
complained that customer service and processing backlogs have not 
improved enough to justify such a steep fee increase.
    These comments illustrate the main distinction between the revised 
fee schedule and current one in that the current fee schedule does not 
reflect the existing costs of performance. The current fee schedule 
does no more than sustain USCIS operations and provide for delivery of 
benefits at an unacceptable level. Historically, USCIS balanced 
resource requirements to allocate insufficient revenues from a fee 
structure that did not recover full costs. The new fee structure is 
designed to maintain sufficient capacity to meet appropriate 
performance standards and goals, while sustaining performance through 
investments to deliver continuous improvements into the foreseeable 
future. USCIS acknowledges the commenters' concerns, and believes that 
these concerns will be satisfied, at least in part, after 
implementation of the new fee structure.
    USCIS is required by law to review its fees at least once every two 
years. 31 U.S.C. 902(a)(8). USCIS has established a dedicated staff in 
its Office of Planning, Budget, and Finance to conduct future 
comprehensive analyses. USCIS is firmly committed to seeking

[[Page 29857]]

improved ways of doing business and reengineering processes in order to 
contain costs. The new fee structure will enable USCIS to make 
improvements that may ultimately help avoid future increases and 
possibly reduce costs. Process improvements implemented over the past 
several years, as well as projected productivity increases, are taken 
into account in the current fee review, keeping fees lower than they 
might otherwise have been. Future productivity enhancements will 
produce lower costs per unit that will be reflected in future price 
adjustments.
    The fees are based on the costs necessary to sustain the processing 
of applications and petitions. If fees collected remain below 
processing costs, the imbalance will, as it has in the past, result in 
a backlog. Backlogs mean customers will not receive the benefits and 
services for which they have applied in a timely manner. A structural 
deficit between costs and fees will also mean USCIS cannot effectively 
sustain operations because of insufficient capital to invest in 
improvements. Over time, a structural deficit between costs and fees 
will create and accelerate the growth of backlogs and deteriorate 
service levels. Delays caused by the inability to meet demand resulting 
from fees set below cost often have far more impact on the person than 
the discrete application or petition fee.
    The proposed fee adjustments and this final rule reflect these 
concerns. Over the past several years, USCIS received appropriated 
funds to reduce processing times and meet the President's goal of a 
six-month or less processing time for nearly all immigration benefit 
applications and petitions. By the end of FY 2006, the application and 
petition backlog had fallen from a high of 3.8 million cases in January 
2004 to less than 10,000 considered under USCIS control. The total 
volume of pending cases is currently less than the backlog was at its 
height, which shows real and substantial progress.
    USCIS has also made many customer service improvements, including, 
but not limited to, expanding online capabilities (such as online 
filing, change of address and case status updates), INFOPASS 
appointments (providing the ability to go online to make, cancel, or 
reschedule appointments with a USCIS Immigration Information Officer), 
and introducing a broad range of fact sheets to help the public 
understand various benefits, eligibility criteria, and USCIS 
procedures. These improvements were made prior to the proposed fee 
increase. With the revenue generated from the new fee schedule, USCIS 
will be able to deliver significant additional improvements. Until 
USCIS aligns its fees with costs, however, it will be unable to afford 
sufficient capacity to process incoming applications and petitions, 
resulting in backlogs.
    b. Inefficiency in business-related visas.
    Some comments highlighted particular inefficiencies and suggested 
that correcting these would mitigate the need for fee increases. An 
example of inefficiency mentioned by many commenters was the long 
processing delays for employment-based visa categories, including the 
immigrant employment-based classifications and the nonimmigrant 
classifications such as the temporary employee H nonimmigrant visa, and 
the intra-company transferees L nonimmigrant visa.
    USCIS acknowledges that it does not always quickly and efficiently 
process the Immigrant Petition for Alien Worker, Form I-140 (Alien 
Employee Petition) for firms requesting USCIS approval to hire a 
foreign worker. Processing delays result from a number of factors that 
are beyond the control of USCIS, including extensive Federal Bureau of 
Investigation (FBI) name checks and retrogression of petition priority 
dates caused by over-subscription of the applicable visa categories. 
The solutions suggested by one commenter, however, such as mandatory 
processing times, automatic fee refunds, or automatic approval, would 
neither improve efficiency nor result in shorter processing time. The 
suggestion that delays result in refunds would merely cause more 
delays. Employers may use the premium processing service, if 
applicable, to obtain faster processing of certain employment-based 
petitions and applications, a process that may alleviate the 
commenters' concerns.
    The national interest is not served and immigration laws are not 
complied with by automatically approving immigration benefits for 
persons solely as a result of the passage of time. Each applicant or 
petitioner must prove his or her eligibility for the benefit sought. 
While a backlog still exists, USCIS has achieved an average processing 
time for an Alien Employee Petition as of January 2007 of less than 135 
days per case, which represents fifteen days faster than five years 
ago, but with a much higher current monthly volume. With the additional 
USCIS resources from this updated fee schedule, performance will be 
enhanced even further.
    c. Multiple biometric data requests.
    Many commenters pointed to the fact that applicants or petitioners 
must provide biometric data more than once. Some commenters considered 
the expiration of fingerprints submissions to be inefficient. Others 
suggested that it was inefficient for USCIS to again request 
fingerprints when they apply for sequential benefit applications. USCIS 
agrees that an applicant should not be required to provide biometric 
data multiple times for a single application. USCIS is developing the 
Biometrics Storage System (BSS) which will allow the re-use of 
fingerprints and, if an application or petition has not been 
adjudicated within the fifteen month validity period, USCIS will be 
able to simply re-submit the stored fingerprints to the FBI, without 
any involvement of the applicant or petitioner. See 72 FR 17172 (Apr. 
6, 2007) (establishing a new system of records). Also, as a matter of 
policy, when an application remains pending, USCIS does not charge the 
applicant the biometric fee again because of a processing delay at 
USCIS.
    In the revised fee structure, the biometric fee is not simply a fee 
for biometric collection or the USCIS cost of the applicant or 
petitioner appearing at an Application Support Center. The biometric 
fee also covers costs associated with the use of the collected 
biometrics for FBI and other background checks. Thus, an applicant will 
pay the biometric fee whenever he or she files another application that 
requires the collection, updating, or use of biometrics for background 
checks. At that point, USCIS can verify the identity of the applicant 
by comparing the newly collected biometrics with those previously 
submitted, providing an important security enhancement. USCIS believes 
that this new process may result in some decreases in costs which may 
offset the costs of background checks incorporated into the biometric 
fee, and has already factored this impact into the fee structure along 
with projected efficiency increases.
    d. Petitions for aliens of extraordinary ability or performers.
    USCIS received many comments requesting improved efficiency in the 
processing of visa petitions for aliens of extraordinary ability in 
science, art, education, business, or athletics, and their spouses and/
or children (the O visa category), or aliens coming to the United 
States temporarily to perform at a specific athletic competition or as 
a member of a foreign-based entertainment group (the P visa category). 
Many O and P petitions are submitted on relatively short schedules, 
i.e. the individual/group is scheduled to

[[Page 29858]]

visit the United States in the near future for a specific event.
    These commenters stated that lengthy and uncertain O and P visa 
processing periods complicated booking foreign artists for performances 
and requested the implementation of a thirty-day maximum processing 
period. This issue is not germane to this rule; however, because of the 
volume of comments received, a brief response is provided.
    The USCIS receipt notice received by an O and P petitioner after 
filing states that the petition will be processed in 30-120 days, but 
that time is a standardized estimate for all O and P petitions for many 
types of performers and organizations. Still, USCIS does everything in 
its control to adjudicate these petitions within 60 days. In spite of 
this fact, cases may be delayed by a number of causes that are beyond 
USCIS control, most commonly a lack of response to USCIS inquiries by 
the sponsoring organization, labor unions and other representatives, 
and the prospective visa recipient. For planning purposes, current 
estimates of various visa classification processing times and 
processing dates are posted on the USCIS website.
    USCIS recently published a final rule to permit petitioners to file 
O and P nonimmigrant petitions up to one year prior to the need for the 
alien's services. 72 FR 18856 (April 17, 2007). Although that rule will 
not resolve all of the commenters' concerns, the longer filing window 
will better assure O and P petitioners that they will receive a 
decision on their petitions in a timeframe that will allow them to 
secure the services of the O or P nonimmigrant when such services are 
needed. USCIS suggests, however, that the nature of the O and P visa 
classifications creates a need to carefully plan performances and book 
foreign entertainment acts. Fees collected after publication of this 
rule will be used to cover USCIS costs and will assist in more reliable 
and consistent adjudication of all applications and petitions, 
including O and P visa petitions.
    e. Pre-screening applications and petitions for lawful permanent 
residence.
    One commenter supported the recommendation of the USCIS Ombudsman 
to require a comprehensive prescreening of Applications to Register 
Permanent Residence or Adjust Status, Form I-485, prior to filing. 
Citizenship and Immigration Services Ombudsman, Annual Report to 
Congress, 50-55 (June 29, 2006) (Recommendation 27). Recognizing that 
adoption of a prescreening process would reduce revenues, the commenter 
posited that it would instead promote efficiency and integrity, and 
enhance security.
    USCIS is committed to a process that handles cases efficiently and 
effectively, meeting all quality requirements in a way that protects 
the national security and public safety of the United States. USCIS 
cannot, however, agree with this recommendation at this time. The 
suggestion for ``up-front processing'' is very similar to a process 
that came to be known as ``front-desking''--a procedure followed by the 
INS in which employees were instructed to review certain applications 
in the presence of the applicant to correct facial deficiencies, 
incomplete responses or errors before accepting the application for 
filing, and not to accept those applications thought to be statutorily 
deficient. Front-desking effectively precluded administrative and 
judicial review of rejected applications because there was no formal 
denial to appeal--only a return of an uncorrectable document. Reno v. 
Catholic Social Services, 509 U.S. 43, 61-63 (1993). Legitimation of 
the concept of up-front processing would require a fundamental change 
in the regulations administered by USCIS and goes well beyond the scope 
of this rulemaking. USCIS will not adopt this proposal as a part of 
this rulemaking.
    f. Transformation project and premium processing.
    Some comments requested more information on transformation plans 
and how premium processing revenues will be spent. Others suggested 
that premium processing be expanded. Another commenter suggested that 
transformation from a paper to electronic process would create 
excessive costs and burdens that would create financial and paperwork 
barriers to citizenship.
    As required by statute, premium processing revenues are deposited 
in the IEFA and will be fully isolated from other revenues and devoted 
to the extra services provided to premium processing customers, and to 
broader investments in a new technology and business process platform 
to radically improve USCIS capabilities and service levels. INA Section 
286(u), 8 U.S.C. 1356(u). USCIS has recognized that its existing 
technology has not kept pace with changing demands and additional 
requirements placed upon USCIS. Since the previous fee structure was 
retrospective and did not include funds for real investments to sustain 
and improve USCIS infrastructure, business choices have been limited to 
those that can be supported by existing technology or no technology.
    The premium processing fee ($1,000) is statutorily authorized for 
employment based applications and petitions. USCIS cannot expand the 
premium processing fee or the applications and petitions available for 
premium processing beyond the statutory limitations.
    USCIS plans to transform the current paper based process into an 
electronic adjudicative process. This transformation will allow USCIS 
to better detect and deter those who seek to do harm or violate the 
laws of the United States, while facilitating benefits processing for 
eligible, low-risk persons.
    USCIS acknowledges that the transition from a paper-based to an 
electronic adjudication system carries with it certain burdens, but 
believes the benefits of the new process will significantly outweigh 
those costs. The new adjudicative process will enable USCIS to enhance 
national security, improve customer service, and increase efficiency by 
increasing its ability to share data with immigration partners, 
improving security by uniquely identifying individuals, improving 
system integrity by creating customer accounts, and providing a single 
worldwide case management system. Nonetheless, as some commenters 
pointed out, not all applicants will have access to the Internet or 
other electronic means of submission. For those individuals, paper 
submissions will remain an option.
    g. Actions planned to improve efficiency.
    USCIS believes that, while sustainability of its operations focused 
on continuous improvement is important, so is real and substantive 
near-term improvement. USCIS structured the revised fee schedule to 
allow it to commit to specific substantial improvements over the next 
two years.
    USCIS is committed to substantial reductions in processing times by 
the end of FY 2008 for four key applications: (1) Application to Renew 
or Replace a Permanent Resident Card, Form I-90 (Application for LPR 
Card); (2) Application to Register Permanent Residence or Adjust 
Status, Form I-485 (Adjustment of Status Application); (3) Immigrant 
Petition for Alien Worker, Form I-140 (Alien Employee Petition), the 
petition for an employer to sponsor a foreign worker for permanent 
residence based on its job offer; and (4) Application for 
Naturalization, Form N-400 (Naturalization Application), the petition 
to become a United States Citizen through naturalization. These four 
applications and petitions represent almost one-third of the USCIS 
total workload. By the end of FY 2008,

[[Page 29859]]

USCIS plans to reduce processing times for each of these cases by two 
months, from six months to four months (naturalization processing will 
be reduced from seven months to five months when the ceremony at which 
a person takes the oath of allegiance is included as part of the 
process). Thus, applicants and petitioners will see a significant 
improvement in the first full fiscal year following these fee 
adjustments. Further, as also indicated in the proposed rule, USCIS is 
committed to a twenty-percent average reduction in case processing 
times by the end of FY 2009, which will extend improvements in 
processing times and service delivery across the spectrum of 
applications and petitions.
    The proposed fee structure commits USCIS to real improvements as it 
is not built simply on today's productivity rates, but on anticipated 
increases in productivity (four percent for the Adjustment of Status 
Application, and two percent for all other products). USCIS is 
accountable for these productivity increases in order for fees to 
support operations as intended.
    Another commenter suggested that hiring more permanent employees 
would improve USCIS efficiency. USCIS agrees with the commenter that 
sufficient staffing is directly related to the ability to collect 
sufficient fees for service as explained in the proposed rule and this 
final rule. As presented in the President's FY 2008 Budget, USCIS plans 
to add 1,004 Adjudication Officers and support staff. However, twenty 
percent of the new staff will be other than permanent employees. Most 
of that staff will handle application and petition volume surges, a 
critical resource to ensure that the backlog does not increase due to 
sudden and unpredictable workload increases. However, the comment 
suggests no regulatory changes. Thus, no changes are made to the final 
rule.
    One commenter questioned how quickly USCIS will be able to 
implement all of the resources outlined in the additional resource 
requirements. The commenter also questioned whether USCIS took into 
consideration ongoing expenses versus one-time expenses. USCIS has 
factored into the fee schedule the appropriate start up costs. USCIS 
did differentiate one-time costs versus recurring costs in its fee 
calculations. For example, one-time costs such as background 
investigations and computer equipment for new hires were included in 
the FY 2008 costs, but not in the FY 2009 costs. These calculations are 
accurately identified in the fee review supporting documentation.
4. Increases Relative to Time
    Some comments suggested that some fees were excessive for certain 
applications and petitions relative to the time it takes to process the 
application or petition. As mentioned above and in the proposed rule, 
the primary basis of the USCIS fee model is the administrative 
complexity, which is the amount of time that it takes to process a 
particular kind of application or petition (identified as ``Make 
Determination'' activity in the proposed rule). The calculation also 
factors in other direct costs, such as the cost of manufacturing and 
delivering a document when that is part of the processing of a 
particular benefit.
    In addition to these costs, the fee calculation model factors in 
the full costs of USCIS operations, including services provided to 
other applicants and petitioners at no charge, overhead costs (e.g., 
office rent, equipment, and supplies) associated with the adjudication 
of the application or petition, and other processing costs. These 
latter costs include responding to inquiries from the public (``Inform 
the Public'' activity), application and petition data capture and fee 
receipting (``Intake'' activity), conducting background checks 
(``Conduct Interagency Border Inspection System Checks'' activity), the 
acquisition and creation of files (``Review Records'' activity), 
preventing and detecting fraud (``Fraud Prevention and Detection'' 
activity), and, when applicable, producing and distributing secure 
cards (``Issue Document'' activity) and electronically capturing 
applicants' fingerprints, photographs, and signatures (``Capture 
Biometrics'' activity). In total, all application and petition fees 
include a total of $72 in ``surcharges'' to recover asylum and refugee 
costs, and fee waiver and exemption costs.
5. Increases Relative to Other Standards
    Many commenters suggested that the fee average or weighted average 
fee increases were out of line with, for example, the Social Security 
Administration's (SSA) 2007 basic cost of living increase, the increase 
in the Gross Domestic Product (GDP), or the federal General Schedule 
salary increase. USCIS appreciates the concerns expressed, but these 
external indicators of costs are not comparable with USCIS' costs. For 
example, SSA's basic cost of living increase is a benefit increase tied 
to inflation, whereas the USCIS fees recover all of the costs of 
operating USCIS, including enhancements required to meet congressional 
mandates, improve efficiency, detect fraud, secure the immigration 
system, and to consolidate elements such as federal salary increases 
into base costs. The real GDP or ``real gross domestic product,'' on 
the other hand, is an estimate of the output of goods and services 
produced by labor and property located in the United States by the 
United States Department of Commerce Bureau of Economic Analysis. GDP 
bears no relation to the cost models that must generate the fees to be 
charged by USCIS.
    Many commenters stated that the increase in the fee for the 
Application for Replacement Naturalization/Citizenship Document, Form 
N-565, from $220 to $380, was unreasonable when compared with 
replacement of other documentation. Most of these commenters compared 
the fee for replacing a citizenship certificate with replacing a Social 
Security card, which the Social Security Administration provides for 
free, or replacing state documents (e.g. driver's licenses) that many 
states provide for a nominal charge.
    Replacement of a social security card, driver's license, voter 
registration card, or passport is substantially different from 
replacement of a certificate of citizenship. USCIS incurs substantial 
costs in determining the validity of the naturalization for which the 
certificate was issued before it can issue a new certificate. As stated 
in the proposed rule and above, this fee schedule is based on the 
relative complexity of adjudication of a benefit application and 
reflects the average relative cost of adjudication of all such 
applications. The fees charged for replacing secure documents reflect 
the full costs incurred by USCIS in replacing those documents. 
Regardless of the type of change requested, USCIS must obtain the 
original records and issue a new certificate after the appropriate 
review and decisions. Charging $380 for adjudication of Form N-565 for 
an infant may recover more fees than that specific adjudication may 
require, however, $380 fails to recover the resources expended to 
determine the validity of the more complicated applications such as in 
the case of an adult who requires significant background investigation. 
Therefore, the Form N-565 fee was not adjusted from what was proposed.
    Other comments stated that some fees should reflect validity 
periods with lower fees for benefits with shorter validity periods. 
This argument is similar to that advanced by many who advocated higher 
fees--that the fees should not be based just on costs, but

[[Page 29860]]

on the real or perceived value of the benefit. USCIS' methodology is 
based on the complexity of the adjudication, not the validity period. 
USCIS establishes maximum allowable time periods that may pass between 
its approval of a benefit and the applicant's receipt of the benefit 
based on the type of case and how passage of time influences the need 
for updates in the information used to make the determination. The 
approval validity period is not designed to generate revenue through 
unnecessary repeat filings. USCIS believes that the current methodology 
is fair and complies with Federal fee guidelines. Decreasing the fee 
for applications for benefits with shorter validity would only shift 
costs to other immigration benefit applications and petitions based on 
considerations that are not applicable. The comment will not be 
adopted.
6. Grandfathering
    Some comments recommended phasing in the fee increase over a period 
of years, or fixing fees at current levels for those who already 
applied for one or more immigration benefits in the past, effectively 
grandfathering fees for those who are already in the USCIS system. 
Deferring fee increases would directly result in service delays. In 
addition, setting fees lower for any class of applicants or petitioners 
would merely transfer costs to other applicants. Thus, USCIS has not 
incorporated these recommendations.
7. Budget Decisions Necessary To Administer Immigration Benefits
    Many comments highlighted a critical aspect of the fee structure--
operations must be sustainable. The real cost of processing a type of 
application or petition is more than the discrete cost of processing a 
particular individual case today. It includes the cost of sustaining 
operations and making investments to continually improve service 
delivery and performance. The proposed fee structure is designed to 
meet performance standards and make continuous improvements through 
investments in training to ensure a high performance workforce, 
facilities to provide services that are more accessible to our 
customers, systems to support operations and performance, and resources 
to improve quality and performance management. These goals are 
consistent with the principles of Office of Management and Budget (OMB) 
Circular A-25.
8. Reorganization
    Another commenter suggested that efficiency could be improved by 
reorganizing USCIS in accordance with the recommendations of the USCIS 
Ombudsman. USCIS has recently reorganized its functions and expects 
this reorganization to provide greater efficiency once it has gained 
traction. See 71 FR 67623. Those expectations were incorporated into 
the proposed rule and this final rule.

C. Alternative Sources of Funding

    Many comments did not dispute the methodology and costs, but 
asserted that applicants and petitioners simply should not be required 
to bear the burden of these fee increases. Many pointed to the benefits 
of immigration and assimilation and argued that because the United 
States benefits as a whole from immigration, as a matter of public 
policy immigrants should not bear the entire cost of processing. Many 
asserted that USCIS should find ways to keep fees down, even if it 
means operating at a deficit. Others suggested substituting 
appropriated monies for user fees to offset particular fees or 
activities or subsidize general USCIS operations.
1. Appropriated Funds
    Many comments recommended that USCIS seek appropriated funds to 
close funding gaps, meaning that taxpayers should subsidize particular 
applications and petitions, certain processes, activities not directly 
related to the adjudication of the particular kind of application or 
petition, or fees in general. Some highlighted the public good and 
positive impact resulting from immigration, naturalization, or certain 
procedures (i.e., background checks) and argued that the public good 
merited the use of tax dollars to offset costs. Many comments suggested 
that appropriations be used to either subsidize specific benefit 
application or petition fees or all fees in general. Some comments 
suggested that fees should be the last recourse for funding immigration 
services; that is, USCIS should be required to have exhausted all 
possible means of seeking appropriated funds before imposing fee 
increases. One commenter faulted USCIS for not engaging Congress to 
cooperatively work on this issue. Others suggested funds be 
appropriated for discrete purposes to offset the cost of a particular 
activity associated with case processing or overall management of 
USCIS.
    Other comments point out that section 286(m) of the INA, 8 U.S.C. 
1356(m), authorizes the recovery of the full cost of providing 
immigration and naturalization services, including services provided 
without charge to many applicants. These comments point out, however, 
that section 286(m) does not mandate full cost recovery, and that USCIS 
still has the option of seeking appropriations and choosing to recover 
less than full cost through user fees. Some commenters urged support 
for specific legislation that would alter the fee development process 
or affect this specific fee review process.
    Finally, one commenter suggested that USCIS use appropriated funds 
to fund unusual or atypical expenses from its fee calculation. The 
commenter suggested that these infrastructure costs represent an 
``investment'' that should not be funded by current immigration and 
naturalization applicants and must not be included in the fee 
calculation.
    These comments go beyond the scope of the regulation and raise 
questions of whether Congress should alter the immigration laws of the 
United States or appropriate general funds for USCIS. In effect, these 
comments suggest that USCIS should take other actions outside the 
rulemaking and the authorization for this rulemaking under INA section 
286(m), 8 U.S.C. 1356(m).
    Law and policy have long supported the proposition that the costs 
of providing immigration benefits should be borne by those applying for 
those benefits. Thus, in this final rule, USCIS is adopting a fee 
schedule to recover its costs through user fees. While it is true that 
Congress has enacted intermittent appropriations to subsidize the 
operations of USCIS, the President's budget for FY 2008 does not 
request such an appropriated subsidy, except specific funds for 
expansion of an Employment Eligibility Verification program. Even if an 
appropriation were to be requested, receipt of sufficient funds 
(without adjusting the fee schedule) to cover the costs of USCIS 
operations may be doubtful. USCIS must fund the services it provides 
through the legal means at its disposal. Deferring the recovery of full 
costs while USCIS explores other funding options will delay service 
delivery to applicants and petitioners.
2. Finding Other Revenue Sources
    Some comments suggested funding USCIS through fines assessed 
against employers who hire aliens who are not authorized to work in the 
United States. Other comments suggested a variation on the methodology, 
such as charging employers more than individuals or charging additional 
fees at the time of naturalization.
    USCIS is statutorily barred from using fines assessed against 
employers. Unless specified in law, all fines and penalties under the 
immigration laws become miscellaneous United States Treasury

[[Page 29861]]

receipts and are deposited into the general fund, not the IEFA. INA 
section 286(c), 8 U.S.C. 1356(c). Those additional sources of USCIS 
revenue that are authorized, such as the DHS share of certain 
supplemental fees collected under section 286(v) of the INA, 8 U.S.C. 
1356(v), have been taken into account in USCIS budgeting and fee 
setting.
    USCIS believes that the methodology used to develop these fees--a 
methodology based on the complexity of the specific application or 
petition--is the most appropriate process to equitably allocate costs 
and provide long-term stable and reliable funding. Part of USCIS' 
funding problem has been reliance on temporary funding sources, 
including appropriated funding. This new fee schedule will establish a 
more stable source of funding. As the number of applications and 
petitions increases, USCIS will be better able to respond to increasing 
workload changes and will no longer be compelled to sacrifice customer 
service or rely on unreliable funding sources.

D. Comments on Specific Benefit Application and Petition Fees

    Many comments that suggested that USCIS seek appropriated funds or 
other subsidies, or other means to reduce fees from the proposed 
levels, also emphasized issues and impacts related to particular 
applications and petitions. The fee development methodology is 
sensitive to the costs of adjudicating each type of application or 
petition based on the complexity of adjudicating it.
1. Naturalization Application
    The fee for the Naturalization Application generated a large number 
of comments from a wide spectrum of commenters. The proposed rule would 
raise this fee from $400 to $675, including the required biometrics 
fee, or a 69 percent increase. Many comments highlighted the public 
interest in promoting citizenship and recommended reducing this fee.
    USCIS understands the sentiment expressed by the commenters that 
becoming a citizen of the United States is an honor to be cherished. 
USCIS disagrees with the commenters who suggested that the proposed fee 
increase is inconsistent with our tradition of welcoming and 
integrating immigrants and that increasing the fee would send the wrong 
message to intending citizens.
    The fee for a Naturalization Application is established at $595 in 
this final rule and properly reflects the intensive scrutiny with which 
a request for such an honor should be reviewed. Naturalization 
applicants who are initially found eligible must be examined under oath 
to assure compliance with the many requirements for citizenship under 
the INA including competency in English, knowledge and understanding of 
United States Government and history, physical presence and maintenance 
of resident status in the United States, and facts and conduct 
reflecting their moral character and attachment to the United States 
Constitution and law. 8 U.S.C. 1401 et seq.
    In adjudicating some naturalization applications, USCIS 
adjudicators must resolve complex subsidiary applications for certain 
exemptions, such as the Application to Preserve Residence for 
Naturalization Purposes, Form N-470, or the Medical Certification for 
Disability Exceptions, Form N-648 (which is processed and adjudicated 
without charge). Further, criminal and national security record checks 
are required for naturalization applications and may require the 
involvement of numerous USCIS personnel. In addition, the 
naturalization adjudication process may require multiple interviews, 
and solicitation and consideration of additional evidence bearing on 
eligibility. Finally, in the event of an adverse decision on the 
application or petition, the applicant is entitled to request a new 
hearing by a different adjudicator. All of these factors are reflected 
in the fee charged to recover the cost of adjudication.
    Two factors in this final rule mitigate the Naturalization 
Application fee increase. First, the final rule maintains the current 
USCIS policy of permitting naturalization applicants to request an 
individual fee waiver. In determining inability to pay, USCIS officers 
consider all factors, circumstances, and evidence supplied by the 
applicant including age, disability, household income, and 
qualification within the past 180 days for a federal means tested 
benefit, as well as other factors associated with each specific case. 
For those applicants not granted a fee waiver, USCIS will charge a fee 
of $595 for processing naturalization applications. Additionally, the 
cost of fingerprints has been reduced slightly, resulting in a 
decreased overall cost for naturalization applicants. Accordingly, 
USCIS has determined that the effort and resources expended to process 
Naturalization Applications justifies this level of fee increase.
2. Application To Register Permanent Residence or Adjust Status
    Many comments emphasized the overall size of the proposed increase 
for the Adjustment of Status Application fee from $325 to $905, or 178 
percent. Most of the proposed fee increase for the Form I-485 was 
driven by the packaging or ``bundling'' of related benefits with no 
separate fee. As indicated in the proposed rule, factoring in separate 
fees, applicants typically pay for additional services related to the 
Form I-485 for which they will no longer pay separately. In this rule, 
after consolidating the fees for the Adjustment of Status Application 
and the requests for interim benefits that previously required 
additional fees, the increase in the fee from $865 to $1,010 (17%), 
including the biometric fee, is significantly below the average 
increase for all fees.
    A few comments suggested that incorporating the fee for the 
Application for Employment Authorization, Form I-765, (Application for 
EAD) and the fee for the Application for Travel Document, Form I-131, 
(Application for Travel Document) into the Adjustment of Status 
Application should only be an option. USCIS issues an Employment 
Authorization Document (EAD) to the alien after it approves an 
Application for Employment Authorization. An alien submits an 
Application for Travel Document to apply for a travel document, reentry 
permit, refugee travel document, or advance parole. EAD and travel 
documents are commonly referred to as ``interim benefits.''
    These commenters suggested that children may not need or desire 
travel documents or work authorization, so the fee for an Adjustment of 
Status Application should be consequently reduced for a child or a 
family. Other comments suggested that, like refugees, asylees should 
not be required to pay the portion of the new Adjustment of Status 
Application fee attributable to the interim benefits, because 
eligibility to work is incident to their status. Finally, several 
commenters suggested that USCIS apply the fee consolidation for the 
Adjustment of Status Application, Application for EAD, and Application 
for Travel Document to all currently pending Adjustment of Status 
Applications.
    USCIS has made no adjustment in this final rule as a result of 
these comments. USCIS determined that a change in the fee schedule was 
not justified because a type of applicant mentioned by the commenters 
may not need or want interim benefits. Neither does this rule adopt the 
suggestion to process Applications for EADs or Applications for Travel 
Documents for currently pending Adjustment of Status Applications 
without fee. USCIS records indicate that most applicants who

[[Page 29862]]

initially choose not to apply for an EAD or travel documents soon do so 
because they find that they need interim benefits almost immediately. 
As for asylees and refugees, asylees are authorized to work, but USCIS 
records indicate that most asylees and refugees obtain an EAD to 
provide to employers as readily accepted proof that they are authorized 
to work in the United States. The fees collected by USCIS for EAD 
Applications fund the costs incurred by USCIS for issuing EADs. USCIS 
incurs costs for adjudicating the Application for EAD which is a 
different issue from an asylee's authorization to work incident to 
asylee status. Further, although refugees are not required to submit a 
fee for their initial Adjustment of Status Application, they are 
required to pay the fee for an Application for EAD or for the 
Application for Travel Document to request a refugee travel document. 
Providing multiple fee options based on who typically requests interim 
benefits, when records indicate that the vast majority of applicants do 
request interim benefits, would be too complicated and costly for USCIS 
to administer. Applicants with a pending Adjustment of Status 
Application who did not pay a fee that incorporates the cost of an 
Application for EAD and an Application for Travel Document must 
continue to file separate interim benefit applications with the 
appropriate fee for each service.
    A number of comments pointed out that the packaging of these 
services and the fee increase means that the total fees a family will 
pay for concurrently filed Adjustment of Status Applications will 
increase substantially, and argued for some form of family cap on the 
total fee to be collected. These commenters pointed out that the child 
fee level under the fee schedule was almost one-third lower than the 
adult fee, but the $100 difference under the proposed fees represents 
only an eleven percent differential between an adult's and a child's 
Adjustment of Status Application fees. These comments added that this 
effect exacerbated the impact of the fee changes on families. Other 
commenters were concerned that, while refugees are charged no fee for 
their Adjustment of Status Applications, the proposed rule provides 
that asylees must pay a fee for an Adjustment of Status Application and 
suggested that this treatment was disparate.
    USCIS considered the suggestion that it institute a maximum fee for 
a family where several members submit simultaneous Adjustment of Status 
Applications (family cap). USCIS analyzed a number of scenarios to 
determine at what level a family cap would not result in a significant 
transfer of the direct costs for adjudicating Adjustment of Status 
Applications for entire large families to individuals or smaller 
families. USCIS also weighed whether or not to transfer the costs of 
adjudicating Adjustment of Status Applications for large families to 
only other adjustment of status applicants or to all other benefit 
applications. Unfortunately, USCIS was unable to determine the size of 
the family at which it was no more administratively burdensome to 
process an Adjustment of Status Application for an additional relative 
when processing multiple, simultaneous Adjustment of Status 
Applications from family members. In the end, USCIS determined that the 
policy or humanitarian considerations inherent in the decisions made in 
this final rule to allow additional fee waivers is not sufficiently 
prevalent in the case of family Adjustment of Status Applications to 
warrant a family cap, absent such data on the requisite burden based on 
size. Thus, USCIS then turned to consideration of the variation in 
Adjustment of Status Application fees based on the applicant's age.
    As pointed out by some comments, the fee for the Adjustment of 
Status Application was $325 for aliens fourteen years of age or older, 
but for aliens under fourteen years of age, the fee was $225. This 
amounted to a 31 percent difference in the base filing fee. In response 
to these comments, USCIS evaluated the difference in actual processing 
time and costs associated with the ``Make Determination'' activity for 
Adjustment of Status Applications. While the proposed fee for an 
Adjustment of Status Application was based on the overall cost of 
processing the average application, regardless of the applicant's age, 
the large majority of Adjustment of Status Applications are filed by 
persons fourteen or older. USCIS conducted an analysis of Adjustment of 
Status Applications submitted concurrently as part of an application 
from a family. For the application to be filed concurrently, the child 
must be a derivative applicant of the adult or the child's status must 
be based on the same legal authority as the adult's. This analysis 
found that there is a 35 percent difference in the average time it 
takes to process an Adjustment of Status Application filed by someone 
under fourteen years of age versus the time it takes to process a case 
filed by someone age fourteen or older. This calculation was consistent 
with the methodology employed by the proposed rule in that an 
identifiable adjudication was segregated and the relative complexity of 
processing the benefit for a subset of applicants was determined. 
Applying this difference to the fee model reduces the fee for an 
Adjustment of Status Application for a family member under age fourteen 
from $805 to $600, and adjusts the fee for family members age fourteen 
and older from $905 to $930. Since the fee will drop for every 
concurrently-filed adjustment of status application for someone under 
14, families with children who all file concurrently will see a drop in 
their collective adjustment fee. For example, a family of two adults 
and one child will see their total adjustment application fees drop by 
$155 relative to what they would have paid without this change, and a 
family with two adults and two children will see their collective fees 
drop by $360. A family with two adults and four children will see their 
fees drop by $770.
    USCIS explored establishing a child discount in other immigration 
and naturalization benefit areas and has determined that a discount for 
adjudication of a child is only appropriate in the case of an 
Adjustment of Status Application. The Adjustment of Status Application 
requires adjudication of a distinct and separate application for a 
child, although it can be submitted simultaneously with other family 
members. Other benefits that require submission of a separate 
application from family members, but allow the family members to submit 
them concurrently for processing are distinguishable. For example, no 
fee is charged for the Registration for Classification as Refugee, I-
590, and the fee for the Application for Temporary Protected Status, 
Form I-821, is statutorily capped at $50 per applicant, which is 
substantially below its adjudication costs. Similarly, besides 
children, there are no other subgroups of applicants for adjustment of 
status who possess qualities that would provide for segregation of 
relative adjudicative complexity that would provide sufficient data for 
a separate fee calculation.
    Likewise, the maximum amount payable by a family was removed from 
the fee proposed for Application to Adjust Status from Temporary to 
Permanent Resident (under Section 245A of Pub. L. 99-603), Form I-698, 
and the Application for Status as a Temporary Resident Under Section 
245A of the Immigration and Nationality Act, Form I-687. That change 
was made mainly because Immigration Reform and Control Act of 1986 
(Pub. L. 99-603, November 6, 1986) requires an applicant under that

[[Page 29863]]

Act to have entered the United States before January 1, 1982, which 
would exclude anyone currently under the age of 18. Further, the family 
cap for fees charged filing Form I-698 and Form I-687 was a policy 
established by INS for legalization and established at three times the 
fee for an individual. As explained earlier, a family cap that is not 
based on adjudicative complexity does not comport with the methods used 
for establishing the fee schedule in this rule. Therefore, beyond 
reducing Adjustment of Status Application fees for children, USCIS will 
not provide any discount for families based on size, and USCIS has 
decided to base Adjustment of Status Application fees on the direct 
costs associated with that service.
    With regard to the different treatment for refugees and asylees, 
the exception for a fee for refugees is based on the requirement that a 
refugee must apply for adjustment of status within one year of 
admission as a refugee. INA section 209(a), 8 U.S.C. 1159(a). Further, 
while refugees have been affirmatively invited by the United States 
Government to come to the United States for permanent resettlement, 
asylees have sought admission of their own accord and requested to be 
allowed to stay. While USCIS agrees that both asylees and refugees 
should receive full protection from persecution, it is a reasonable 
policy choice to be more generous in awarding immigration benefits to 
those who are invited. Nonetheless, in response to comments on this 
subject, USCIS has decided to allow asylees to request a waiver of the 
Adjustment of Status Application fee on an individual basis. Section 
III.E addresses changes in fee waivers in more detail below.
3. Employment Authorization for Students
    Many educational institutions and their representatives submitted 
nearly verbatim comments on the proposed fee increase for an 
Application for EAD. These commenters expressed significant concerns 
about the size of the fee and its effect on the limited financial 
capability of most international students in F visa status and their 
ability to apply for work authorization when they choose to participate 
in the Optional Practical Training (OPT) program. These comments noted 
that international students on F-1 visas are limited to 20 hours per 
week of on-campus employment and the money to pay the Application for 
EAD fee will curtail their ability to buy food and pay rent. Similarly, 
these same commenters, for the most part, expressed general concerns 
about the immigration benefit application expenses for international 
students and their family members, who typically are of limited means.
    For international students, F-1 status allows a student to remain 
in the United States as long as they are a properly registered full-
time student. To maintain full-time status, a student must take at 
least four courses per semester at the undergraduate level, and 
depending on the academic program, three or four courses per semester 
at the graduate level. Also, under F-1 status, a student may work part-
time in an on-campus job and in a ``practical training'' job directly 
related to the student's field of study for twelve months during or 
after the completion of studies. The OPT program mentioned by the 
commenters grants temporary employment authorization to provide F-1 
students with an opportunity to apply knowledge gained in the classroom 
to a practical work experience off campus. To be eligible for OPT, a 
student must have been in full time student status for at least one 
full academic year preceding the submission of their application for 
OPT, be maintaining valid F-1 status at the time of the application, 
and intend to work in a position directly related to his or her major 
field of study.
    The United States places a very high value on attracting 
international students and scholars to this country. The contributions 
to the academic experience for all students provided by the existence 
of a diverse international student body are invaluable. The resources 
devoted to delivering immigration benefits to deserving students show 
the importance of this goal to USCIS. USCIS also understands that 
international students already face significant hurdles, including 
financial hurdles, which is why the fee structure consolidated fees 
where consolidation made sense, and kept fees to a minimum. 
Nonetheless, substantial resources are expended by USCIS for 
adjudication of the student's eligibility for employment documents and 
the fee for an Application for EAD was established based on those 
needs. Further, while USCIS acknowledges that the salaries provided by 
OPT are helpful, the emphasis of OPT is on training students in their 
fields of study, not as a source of income. To that end, the $340 cost 
of requesting an Application for EAD is a very small portion of the 
total expenses incurred by an alien pursuing studies in the United 
States. EAD applicants may request an individual fee waiver based on 
inability to pay. For Applications for EAD that are not granted a fee 
waiver, USCIS will charge a fee of $340 for processing based on the 
effort and resources expended to process this benefit.
4. Application for Advance Processing of Orphan Petition
    Many comments focused specifically on the fees for a Petition to 
Classify Orphan as Immediate Relative, Form I-600, and an Application 
for Advance Processing of Orphan Petition, Form I-600A. Several 
comments suggested that USCIS should reduce the fee and offer fee 
waivers for orphan petitions. These commenters effectively request that 
USCIS shift the costs of this program to other immigration benefit 
applications and petitions.
    Adjudicating orphan petitions involves some of the most complex 
decision-making within immigration services because adjudication of 
Petitions to Classify Orphan as Immediate Relative and Applications for 
Advance Processing of Orphan Petition requires knowledge of many state 
adoption regulations and statutes and foreign country adoption 
requirements. Each petition must be accompanied by a home study, 
background checks, and evidence that must be carefully examined. 
Approval of parents as suitable to adopt is time sensitive as a result 
of the potential changes in a household that may impact the suitability 
of the home for an adopted orphan, such as loss of a job or divorce. 
Such changes often prevent reconsideration of the parents' petition. As 
a result of this approval expiration period, currently set as eighteen 
months, prospective adoptive parents must submit a new petition and all 
supporting documents if they wish to continue with the adoption process 
if they have not been matched with a child. USCIS sometimes works with 
a case for months, involving frequent contact with adoption agencies, 
social workers, and prospective adoptive parents. Finally, 
international orphan adoption adjudications require an investigation 
and information verification, and may require travel. This fee increase 
will allow USCIS to automate case management of adoption cases, further 
reducing any real or perceived delays in the manual, paper-based 
process currently in place.
    Orphan petitioners must attest that the beneficiary will not become 
a public charge in order to be approved as a suitable adoptive parent. 
Further, the orphan petition fee is a small part of what a United 
States citizen petitioner chooses to accept as part of the overall 
process and cost of adopting a child from overseas and raising that 
child. The financial circumstances required to be eligible for this 
benefit directly contradict the rationale for shifting costs related to 
these applications to others,

[[Page 29864]]

or for offering a waiver of the fee because of inability to pay.
    A significant number of comments suggested that USCIS mitigate the 
cost by extending the validity of approved orphan petitions and the 
results of background checks. Commenters complained that processing in 
the country from which the child comes often takes longer than the 
current approval validity, which creates re-work and additional fees. 
The length of the validity of the approval of any petitioner or 
applicant for a benefit was not mentioned in the proposed rule and 
cannot be amended by this final rule. Thus, these comments are beyond 
the scope of this rule.
    The final rule provides, as does the current USCIS fee schedule, 
that when more than one petition is submitted by the same petitioner on 
behalf of orphans who are brothers or sisters, only one fee will be 
required. No fee is collected on additional siblings because USCIS 
determined that processing efficiencies provided by the ability to 
adjudicate two siblings simultaneously did not justify an additional 
fee. However, in the case of multi-child simultaneous petitions when 
the orphans are not siblings, USCIS requires separate fees for each 
child because of the processing requirements of determining eligibility 
of each child. In addition, if a filing fee is paid at the time of 
filing an Application for Advance Processing of Orphan Petition, a fee 
is not required again to file a Petition to Classify Orphan as 
Immediate Relative.
    Since a large number of commenters ardently mentioned this issue as 
part of their comments, USCIS has decided to allow a prospective 
adoptive parent to receive one extension of the approval of the 
Application for Advance Processing of Orphan Petition at no charge. 
Prospective adoptive parents, who have not found a suitable child for 
adoption as evidenced by their failure to submit a Petition to Classify 
Orphan as Immediate Relative after approval of their Application for 
Advance Processing of Orphan Petition, will be allowed to request one 
extension of the approval without charge, including the biometric fee. 
This final rule does not change the proposed petition fee of $670. The 
request from the applicant for an extension of the approval must be in 
writing and received by USCIS prior to the expiration date of approval 
indicated on the Notice of Favorable Determination Concerning 
Application for Advance Processing of Orphan Petition, Form I-171H. 
This no charge extension is limited to only one occasion. A complete 
application and fee must be submitted for any subsequent application. 
This final rule also provides that no biometric service fee will be 
charged for an update of the biometrics required for an extension of an 
approved Application for Advance Processing of Orphan Petition. The 
same limitations apply.
    USCIS determined that the costs of processing an initial extension 
were minimal when it results only from the parents' inability to match 
with a child within the first approval period and the update process 
begins before expiration actually occurs. The full fee will be charged, 
however, for adjudicating a new application when a child has not been 
matched after the first extension (the second approval period). Because 
of the length of time involved (three years) and the need for 
substantial updates, the second update often involves the same 
complexity as the initial application. Similarly, when the approval 
expires and a new application is submitted as a result of the first 
child selected by the prospective adoptive parents not being adopted 
(denial of Petition to Classify Orphan as Immediate Relative, Form I-
600), the resources expended to adjudicate the first Petition to 
Classify Orphan as Immediate Relative require a new fee for beginning 
the process anew for a new orphan from the same country or a different 
foreign country as the first application.
5. Entrepreneurs
    One commenter, representing an association of affected individuals, 
claimed that the fee for the Immigrant Petition by Alien Entrepreneur, 
Form I-526, is incorrect because this benefit is only adjudicated at 
USCIS service centers, not at USCIS local offices as stated in the 
proposed rule. In addition, the commenter stated that USCIS has not 
shown why the percentage increase for the Immigrant Petition by Alien 
Entrepreneur (for EB-5 status) filing fees should be higher than 
others, especially when compared to the Petition by Entrepreneur to 
Remove Conditions, Form I-829. The commenter stated that petitions to 
remove conditions generally should take less time to adjudicate the 
original entrepreneur petition, which has a lower proposed fee. USCIS 
recognizes that the Immigrant Petition by Alien Entrepreneur is indeed 
adjudicated at local offices. USCIS service centers will refer certain 
cases to local offices for interview, however, the volumes of Immigrant 
Petition by Alien Entrepreneur filings referred are relatively small 
(three percent), and the resulting cost impact is minimal.
    The Immigrant Petition by Alien Entrepreneur and the Petition by 
Entrepreneur to Remove Conditions are two of the more labor intensive 
petitions that USCIS processes, as evidenced by the high completion 
rates in the proposed rule. As stated in the proposed rule, the more 
complex an immigration or naturalization benefit application or 
petition is to adjudicate, the higher the unit costs. Although the 
completion rates for the entrepreneur petition and the petition to 
remove conditions are approximately the same, the fees are 
substantially different because the costs are being spread across a 
smaller number of petitions (600 for immigrant entrepreneur petitions 
compared to 45 for Petitions By Entrepreneur to Remove Conditions), 
resulting in a higher unit cost for the petition to remove conditions. 
USCIS explained this reasoning in the proposed rule and it remains 
valid.
6. Effect on Availability of Skilled Workers
    Some commenters specifically argued that an increase in fees will 
deter employers from seeking skilled workers from outside the United 
States to fill gaps in the workforce, adversely affecting the 
competitiveness of the United States. USCIS disagrees with the notion 
that an increase in fees will deter employers from seeking skilled 
workers for employment in the United States. There is no evidence 
suggesting that fee increases deter skilled workers from coming to the 
United States, as these comments suggested. In addition, this rule does 
not require an individual alien to pay his own petition fees since the 
fees for employment-based visa petitions are generally paid by the 
firms hiring an alien for a position. Moreover, in most employment-
based visa categories, the demand for immigrants greatly exceeds the 
maximum number of visas permitted each year under the INA. For example, 
applications for H-1B visas exceeded the FY 2007 statutory cap on the 
first day that applications were accepted.
    USCIS expects substantial demand for these visas to continue 
following the implementation of this rule. Similarly, there is no 
evidence suggesting a direct correlation between a fee increase of this 
magnitude for immigration benefits and illegal immigration, as some 
comments have suggested.
    One commenter, representing an association of agricultural 
employers, claimed that the proposed fee for the Nonimmigrant Worker 
Petition is unfair because the cost to adjudicate this benefit varies 
greatly depending on the type of petitioner. The commenter suggested 
that H-2A employers are subsidizing the other, more complicated 
petitions of this form type. USCIS

[[Page 29865]]

recognizes that some adjudications within a particular form type are 
more expensive than others, and that the more complex petitions are 
subsidized by the simpler ones since the fee is calculated as an 
average. While USCIS understands the position of this commenter, it 
would be far too complex and expensive to administer a fee schedule 
based on the type of applicant or petitioner within a particular 
benefit. USCIS disagrees with this recommendation as it would further 
increase fees to recover the additional costs necessary to administer 
this change.

E. Fee Waivers and Exemptions

    A number of comments focused on applicants or petitioners who would 
not be required to pay a filing fee for immigration benefits, relating 
to fee exemptions for classes of applicants or petitioners and requests 
for fee waivers due to inability to pay, as set forth in 8 CFR 
103.7(c). Some comments argued that class fee exemptions and fee 
waivers should be further limited because they simply transfer costs to 
other applicants or petitioners. Others argued that fee waivers should 
be granted on a far wider basis. In response to comments, USCIS 
reconsidered the fee waiver provisions of the proposed rule.
    A fee waiver based on inability to pay requires that other 
applicants or petitioners pay for the same service and for a portion of 
the fee being waived for that applicant or petitioner. Fee waivers 
represent approximately one percent of the total applications and 
petitions filed with USCIS each year.
    Many comments implied that waiving fees in such a small percentage 
of cases suggests that the current fee waiver policy is far too 
stringent, and should be liberalized rather than further restricted. 
However, while the number of fee waivers USCIS grants represents a 
small percentage of total filings, USCIS has historically granted most 
of the fee waiver requests received. Another reason why the number of 
fee waivers may be seen by some as low is that individual fee waivers 
are granted in addition to fee exemptions granted to certain classes of 
individuals. Taken together, on a transactional basis, USCIS does not 
collect a fee in over seven percent of the cases received. Excluding 
business petitions to bring in foreign workers, nonimmigrant matters 
where the aliens must be able to support themselves to be eligible for 
status, and cases involving international travel, fee waivers represent 
over eight percent of the remaining workload. Given the complexity of 
asylum and refugee processing, from a workload perspective, fee waivers 
represent well over ten percent of the remaining effort.
    In addition, the application fee for Temporary Protected Status 
(TPS) is limited by statute to $50. INA section 244(c)(1)(B), 8 U.S.C. 
1254a(c)(1)(B). USCIS has historically waived the filing fee for TPS 
status for aliens unable to pay even this statutorily capped fee. 8 CFR 
244.20.
1. Victims and Asylee Adjustment of Status Applications
    USCIS proposed to exempt certain classes of aliens from paying a 
filing fee where it believes that the incidence of fee waivers due to 
inability to pay would be very high. In the proposed rule, USCIS 
proposed to expand the class fee exemptions to three small volume 
programs: Victims of human trafficking (T visas), victims of violent 
crime (U visas), and Violence Against Women Act (VAWA) self 
petitioners. See INA sections 101(a)(15)(T) or (U), 8 U.S.C. 
1101(a)(15)(T) and (U), and Public Law 109-162, secs. 811-817, 119 
Stat. 2960, 3057 (Jan. 5, 2006). Those programs involve the personal 
well being of a few applicants and petitioners, and the decision to 
waive these fees reflects the humanitarian purposes of the authorizing 
statutes. The final rule maintains this blanket fee exemption because 
it is consistent with the legislative intent to assist persons in these 
circumstances. Anecdotal evidence indicates that applicants under these 
programs are generally deserving of a fee waiver. Thus, USCIS 
determined that these programs would likely result in such a high 
number of waiver requests that adjudication of those requests would 
overtake the adjudication of the benefit requests themselves.
    After reviewing the potential numbers of such applicants, USCIS has 
decided to allow these classes of aliens to request a fee waiver for 
when filing an Adjustment of Status Application. USCIS has made this 
determination for all of the reasons stated above, but tempered by the 
fact that an application to adjust status cannot be filed for a 
significant time after the alien has been granted T, or U status. 
Accordingly, this rule provides that a Form I-485 may be subject to a 
fee waiver when the person's eligibility for adjustment of status stems 
from asylum status, T status (victims of human trafficking), U status 
(victims of violent crime who assist in the prosecution), self 
petitioners under the Violence Against Women Act, or where by law the 
person otherwise is not required to demonstrate that he or she will not 
become a public charge, including but not limited to, Adjustment of 
Status Applications for Special Immigrant--Juveniles, or based on the 
Cuban Adjustment Act, Haitian Refugee Immigration Fairness Act, and the 
Nicaraguan Adjustment and Central American Relief Act. This final rule 
does not expand fee waiver eligibility further in adjustment of status 
cases. The changes made to the fee waiver and exemption eligibility 
criteria did increase fee waiver and exemption costs somewhat, but this 
had no impact on the resulting fee schedule given the insignificant 
volume numbers associated with the affected applications and petitions.
2. Special Immigrant--Juvenile
    A number of commenters suggested that ``Special Immigrant--
Juveniles'' also should be exempt from certain fees. A ``Special 
Immigrant--Juvenile'' is an immigrant under the age of 21, unmarried, 
who is a ward of a court in the United States (for the most part State 
courts) or eligible for long-term foster care or in custody of a state 
agency, and judicial proceedings have determined that it would not be 
in that Special Immigrant--Juvenile's best interests to be returned to 
his or her home country.
    USCIS has determined that a fee exemption for this petition would 
be consistent with the exemptions granted for other classes of aliens 
and the humanitarian purpose of the statute. Therefore, the final rule 
exempts ``Special Immigrant--Juveniles'' from the fee for submitting a 
Petition for Amerasian, Widow(er), or Special Immigrant, Form I-360. 
This fee exemption is a change from the proposed rule in addition to 
the change allowing a Special Immigrant--Juvenile to apply for an 
individual waiver of the fee for an Adjustment of Status Application.
3. Biometric Fee
    Numerous comments suggested that the biometric fee was a burden for 
those aliens who could not afford it. In response, USCIS conducted an 
analysis of the costs to USCIS if such waivers were allowed. As with 
any other waiver, the loss of that fee revenue would necessarily be 
spread across all other benefit applications and petitions, having the 
potential to increase those fees.
    To analyze this issue, USCIS determined the total number of 
requests for waivers received in FY 2006, the number of fee waivers 
approved, and the number approved that were for applications where 
biometrics were required. USCIS determined that, had the biometric fee 
been waived for those

[[Page 29866]]

applicants or petitioners whose waiver request for the underlying 
application or petition was approved, the associated costs for 
collecting the biometrics spread across all paying applicants would 
have added only one dollar to the biometric collection fee. Because all 
fees are rounded to the nearest $5 increment, the model showed that 
allowing a fee waiver for the biometric fee would result in no 
increase. Therefore, USCIS decided to accept the commenters' 
suggestion. This final rule provides discretion to USCIS officials to 
waive the biometric fee, following the same general guidelines used to 
consider all other requests for fee waivers such as financial hardship. 
Beyond these limited programs, and those for asylees and refugees, 
USCIS has decided not to shift the costs of processing any other 
specific immigration benefit applications and petitions to others.

F. Authority To Set and Collect Fees

    Some comments suggested that the proposed rule exceeded USCIS' 
statutory authority to collect fees. Some comments suggested that 
administrative and overhead costs were not related to the provision of 
services and should be excluded. Other comments suggested that 
enforcement costs should be excluded from the fees, while others 
posited that all of the enforcement costs of immigration and law 
enforcement agencies should be recovered by fees. Underlying these 
comments is the issue of compliance with the authorizing statute and 
internal Executive Branch guidance. On the other hand, one commenter 
particularly noted that while USCIS is permitted to fund all of its 
operations from fees, there is no statutory mandate requiring it to do 
so. These comments raise the issue of the general structure of the fee 
account, and whether user fees can legally recover certain costs. 
Accordingly, a more detailed explanation of the legislative authority 
and management guidance is provided.
1. Authority Under the INA
    Before the IEFA was created in 1988, all activities related to case 
processing were funded by appropriations. Public Law 100-459, sec. 209, 
102 Stat. 2186 (Oct. 1, 1988). While fees were charged prior to 1988, 
the fees were treated as miscellaneous receipts of United States 
Treasury and deposited in the general fund; those fees were not 
available to USCIS for spending. The fee account was created to provide 
an alternative to appropriations. As many of the comments stated, the 
law does not preclude the use of appropriations to subsidize fee 
receipts to fund operations. In the absence of appropriations, however, 
the only funding source is fee revenue. The President's FY 2008 budget 
is based on user fee funding for USCIS operations (other than expansion 
of employment verification) and will fund all other USCIS operations 
from fee receipts. Accordingly, the proposed rule was issued in 
conjunction with the FY 2008 budget proposal.
    INA Section 286(m), 8 U.S.C. 1356(m), provides that the United 
States may collect fees at a level that will ensure recovery of the 
full costs of providing adjudication and naturalization services, 
including the costs of providing similar services without charge to 
asylum applicants and certain other immigrants:

    Notwithstanding any other provisions of law, all adjudication 
fees as are designated by the [Secretary] in regulations shall be 
deposited as offsetting receipts into a separate account entitled 
``Immigration Examinations Fee Account'' in the Treasury of the 
United States, * * *: Provided further, That fees for providing 
adjudication and naturalization services may be set at a level that 
will ensure recovery of the full costs of providing all such 
services, including the costs of similar services provided without 
charge to asylum applicants or other immigrants. Such fees may also 
be set at a level that will recover any additional costs associated 
with the administration of the fees collected.

Under this authority, user fees are employed not only for the benefit 
of the payor of the fee and any collateral benefit resulting to the 
public, but also provide a benefit to certain others, particularly 
asylum applicants and refugees and others whose fees are waived.
2. General Authority for Charging Fees
    Comments suggested that only the activities directly relating to 
specific adjudications should be charged to those who apply for the 
benefits. These comments rely on statutory authority separate from the 
authority for these fees. The general authority for the federal 
government to collect fees stems from the Independent Offices 
Appropriation Act, 1952 (IOAA), 31 U.S.C. 9701(b). Under the IOAA, a 
``value'' to the recipient is a key threshold factor and the costs of 
``public interest'' have been effectively included within the fees. 
National Cable Television Ass'n v. United States, 415 U.S. 336 (1974); 
FPC v. New England Power Co., 415 U.S. 345 (1974); Seafarers Internat'l 
Union v. Coast Guard, 81 F.3d 179, 183 (D.C. Cir. 1996). In New England 
Power Co., the Supreme Court held that the IOAA authorizes ``a 
reasonable charge'' to be made to ``each identifiable recipient for a 
measurable unit or amount of Government service or property from which 
[the recipient] derives a special benefit.'' 415 U.S. at 349 (quoting 
Bureau of the Budget Circular No. A-25 (Sept. 23, 1959)). Such fees may 
be assessed even when the service redounds in part to the benefit of 
the public as a whole. National Cable Television Ass'n, 415 U.S. at 
343-44. So long as the service provides a special benefit above and 
beyond that which accrues to the public at large to a readily-
identifiable individual, the fee is permissible. New England Power, 415 
U.S. at 349-51 & n. 3.
    Prior to the enactment of section 286(m) of the INA, fees charged 
for immigration services were governed by the IOAA and were judicially 
reviewed under the IOAA. A more elementary cost analysis than that 
currently used was upheld by the courts. Ayuda, Inc. v. Attorney 
General, 661 F. Supp. 33 (D.D.C. 1987), aff'd, 848 F.2d 1297 (D.C. Cir. 
1988). As the Court of Appeals in Ayuda stressed, the procedures were 
``triggered only at the instance of the individual who seeks, 
obviously, to benefit from them.'' 848 F.2d at 1301.
    The United States is a nation largely built by immigrants and 
immigration continues to refresh this country. Accordingly, USCIS 
agrees that there is a certain undeniable public interest in 
immigration. The costs reflected in the proposed fees exist, however, 
because applicants and petitioners seek immigration benefits and 
services. There are also public interests in discrete processes such as 
background checks. Background checks are an integral part of 
determining the applicant's eligibility for a benefit, and thus, their 
costs are appropriate for full recovery through a fee. Were it not for 
the underlying application or petition for immigration benefits, these 
specific security checks would not have been conducted.
    USCIS authority under section 286(m) of the INA is an exception to 
any limitation of the IOAA. 31 U.S.C. 9701(c). The relevant, second 
proviso was added to the INA after the Court of Appeals decided Ayuda 
under the IOAA. Public Law 101-515, sec. 210(d)(1), (2), 104 Stat. 
2120, 2121 (Nov. 5, 1990). The statutory provisions in section 286(m) 
of the INA are broader than the IOAA, authorizing USCIS to recover the 
full cost of providing benefits and ensuring sufficient revenues to 
invest in improved service and technology. Even though the requirements 
of the IOAA do not apply in developing these fees, USCIS is mindful of 
the need to explain the

[[Page 29867]]

process to the general public. Cf. Engine Manufacturers Assoc. v. EPA, 
20 F.3d 1177 (D.C. Cir. 1994).
3. Surcharge for Asylum, Refugee and Fee Waiver/Exemption Costs
    Some comments questioned whether fees should include the surcharge 
for services USCIS provides without fee or where it waives a fee, and 
asserted that these costs should not be transferred to other 
applicants. Pursuant to section 286(m) of the INA, USCIS does include 
these surcharges in other application and petition fees.
    USCIS could charge a specific fee to apply for asylum and that fee 
would be limited to the ``costs in adjudicating the applications.'' 
Section 208(d)(3) of the INA, 8 U.S.C. 1158(d)(3). The humanitarian 
nature of the asylum process gives USCIS good reason not to exercise 
this authority. USCIS has never charged fees for an Application for 
Asylum, Form I-589. For the same reasons, asylum applicants are exempt 
from the requirement to submit the fee for fingerprinting with the 
application for asylum. 8 CFR 103.2(e)(4)(ii)(B).
4. OMB Circular A-25
    When a service enables the beneficiary to obtain more immediate or 
substantial gains or values than those that accrue to the general 
public, a user fee is appropriate. The fact that a process benefits the 
public interest as well as a private party does not mean that process 
cannot be funded by a user fee. The entire legal immigration and 
citizenship process, with respect to both grants of benefits and 
denials for national security or other reasons, is one that benefits 
the public as well as private interests, but focuses on the 
adjudication of eligibility for individual benefits. A fee-based 
structure is appropriate even when the public as a whole benefits. As 
OMB Circular A-25 makes clear, ``when the public obtains benefits as a 
necessary consequence of an agency's provision of special benefits to 
an identifiable recipient (i.e., the public benefits are not 
independent of, but merely incidental to the special benefits), an 
agency need not allocate any costs to the public and should seek to 
recover from the identifiable recipient either the full cost to the 
Federal Government of providing the special benefit or the market 
price, whichever applies.'' OMB Circular A-25, ] 6.a.3. Accordingly, 
the proposed fees do not conflict with the guidance in OMB Circular A-
25.
    Moreover, OMB Circular A-25 is one of a series of circulars, 
bulletins and memoranda issued by OMB for the internal management of 
the Executive Branch. To be transparent, the circulars and agency use 
of the circulars are often publicly spelled out in regulations and 
other public statements. In this case, as with any fee rule of this 
nature and magnitude, the proposed rule and this final rule have been 
considered by OMB and other Executive offices in accordance with the 
appropriate Executive Orders, including Executive Order 12866, as 
amended, and other management instructions and directives.
    While section 286(m) of the INA is a separate authority for the 
cost analysis and fees, as stated earlier, USCIS follows the procedures 
outlined in OMB Circular A-25 and standard accounting procedures as 
discussed in the proposed rule to the extent that they are applicable. 
Further, the ``full cost'' concept also includes the amount required to 
manage USCIS or ``overhead.'' The proposed rule described the types of 
costs that USCIS considered as overheard when determining the proposed 
fee levels.
    One commenter provided a detailed but limiting analysis of USCIS' 
authority under section 286(m) of the INA, 8 U.S.C. 1356(m), suggesting 
that ``full cost'' was more limited than suggested in the proposed rule 
and limited to specific ``activities,'' and suggesting that most of the 
enhancements fell outside USCIS authority to recover as fees. USCIS 
disagrees.
    Section 286(m) permits USCIS wide latitude in determining the 
degree to which fees will be used to support operations. USCIS, in 
conjunction with DHS and OMB, has determined that fees should recover 
all, but not more, than the cost of operation for USCIS. Accordingly, 
the Administration has not requested an appropriation for USCIS, except 
specific funds for expansion of a voluntary employment verification 
program, for which USCIS is prohibited by statute from charging fees 
for this program. Illegal Immigration Reform and Immigrant 
Responsibility Act of 1996, Public Law 104-208, tit. IV, sec. 
402(c)(1), 110 Stat. 3009-657 (Sept. 30, 1996).
    The ``full cost'' of services may be interpreted, and USCIS 
interprets the full cost of services to mean all of the support costs 
for such service within USCIS. The activities that may be included are 
not strictly those with a direct effect on a specific application or 
petition, but may include those activities that support the 
determination, including determining whether fraud is being perpetrated 
against the immigration system and providing public information to help 
improve understanding of both the specific applications and petitions 
and the manner in which immigration benefits are adjudicated. 
Accordingly, USCIS believes that all of the costs identified in the 
proposed rule may be recovered through fees.
    Finally, the costs of all of the 27 identified enhancements may be 
recovered. Some of these enhancements are designed to comply with 
Congressional mandates for the operation of the government; others are 
designed to ensure that USCIS operates securely and efficiently. While 
these costs and many other enhancements could be the basis for 
disagreement, USCIS acts within its discretion to account for them 
within the fees to be charged.
5. Homeland Security Act
    A commenter suggested that the proposed rule, if promulgated in 
final form, exceeded the authority provided to DHS in the Homeland 
Security Act of 2002 (HSA), Public Law 107-296, 116 Stat. 1135 (Nov. 
26, 2002). In particular, the commenter suggested that the division of 
functions between USCIS under section 451 of the HSA, 6 U.S.C. 271, and 
the then-Under-Secretary for Border and Transportation Security under 
section 441 of the HSA, 6 U.S.C. 251, required a more limited scope for 
USCIS fees, excluding any law enforcement or national security 
functions under the Fraud Detection and National Security operations.
    Another commenter suggested that USCIS authority was even more 
restricted to the functions of the former Adjudications Branch of the 
INS that were transferred to DHS. By contrast, another commenter 
conceded that while USCIS is permitted to fund all of its operations 
from fees, there is no statutory mandate requiring it to do so.
    DHS disagrees with these suggested restrictions and agrees that it 
may fund, as a matter of discretion, all of USCIS operations, or more, 
from fees. Congress provided the Secretary with reorganization 
authority to allocate or reallocate functions within DHS. HSA, section 
872, 6 U.S.C. 452. The division of functions transferred by the HSA is 
subject to the direction and management of the Secretary. HSA sections 
101, 102; 6 U.S.C. 111, 112. Accordingly, the Secretary may adjust the 
functions within USCIS or across component lines as appropriate.
    The reorganization of functions within USCIS to create the FDNS was 
a consolidation of specific previous functions to streamline 
operations. Accordingly, USCIS disagrees that the inclusion of FDNS in 
the fee calculation is inappropriate and will continue to fund that 
function through fees.

[[Page 29868]]

Furthermore, the functions performed by USCIS are entirely consistent 
with those transferred from INS to USCIS by the HSA.
    Accordingly, this final rule establishes a level of fees sufficient 
to recover the full cost of operating USCIS. The rule has not been 
amended to include other costs that could be legally charged or to 
exclude any costs of operating USCIS.

G. Methods Used To Determine Fee Amounts

    The cost of providing the right benefit to the right person in an 
appropriate amount of time without compromising security is a complex, 
carefully administered process. The fees promulgated in this final rule 
reflect the costs resulting from the complexity of the various 
immigration benefits that USCIS administers and the costs of the large 
number of benefits provided for which there is no charge. By recovering 
the full cost of doing business, the revised fee schedule will enable 
USCIS to reduce application and petition processing times and improve 
customer service, and in the long run, make the legal immigration 
process more secure, efficient, and welcoming to all immigrants.
1. USCIS Costs
    A number of comments questioned or asked for additional information 
on the methodology used to determine USCIS costs. Others questioned the 
costs and calculations provided in the proposed rule, while some 
requested an invoice that details the costs of services. USCIS is 
making no changes to the final rule as a result of these comments.
    Detailed information on the methodology and the cost components and 
calculations was provided in the proposed rule and remains on the 
docket of this rule, and will be provided directly by USCIS upon 
request. The underlying supporting elements, such as independent legal 
requirements, the General Schedule pay scales, or travel reimbursement 
rates, are all publicly available. In the notice of proposed 
rulemaking, USCIS offered to provide the public with an opportunity to 
review the functioning of the computerized cost model used by USCIS 
through onsite viewing on its computer system. While USCIS cannot 
provide complete access to the computer software purchased under 
license, USCIS' fee determination is, within reason, an open process, 
and a summary of how calculations were made and results achieved were 
available for review upon request. USCIS did not receive any requests 
to access the modeling program.
    Finally, preparation of an ``invoice'' would be an additional 
administrative task that would itself add to the costs to be recovered 
by the fees. The United States does not prepare such documents beyond 
the warrants, journals, ledgers, and books of account required to be 
prepared and preserved by law and Executive policy. See, e.g. OMB, 
Financial Reporting Requirements, OMB Circular A-136 (rev. July 24, 
2006).
2. Alternative Budget Modeling
    Several commenters suggested that USCIS consider alternative budget 
modeling. One commenter suggested using a ``zero-based budget'' to 
determine application and petition fees, stating that the enacted FY 
2007 IEFA budget used by USCIS could involve inefficient expenditures 
that waste time and money and disserve immigrants and families who have 
filed applications or petitions. A ``zero-based budget,'' or ZBB, is a 
planning tool in which all expenditures must be justified and analyzed. 
The United States attempted ZBB in the late 1970s. The first 
requirements for the calculation of a ``current services'' baseline 
were enacted in the early 1970s, and a variety of concepts and measures 
have been employed, including ZBB. USCIS believes, however, that the 
baseline has serious technical flaws, which compromise its ability to 
serve as a neutral measure. ZBB, like other systems such as Planning-
Programming-Budgeting System (PPBS), can be a useful tool, but requires 
defined decision units that, for a service organization like USCIS, 
would mean a complete time and motion study of every activity, which 
would be very labor intensive and time consuming and which would be a 
cost factored into the fee requirements.
    The commenters' concerns about the budgeting methods are addressed 
in the fee determination and budgeting methodology utilized. The Budget 
of the United States is developed on a ``current services estimates,'' 
or ``baseline'' budgeting, methodology which is designed to provide a 
neutral benchmark against which policy proposals can be measured. The 
current services estimates (which include inflation) may only be 
changed through justification of adjustments and enhancements. 
Accordingly, consistent with the United States Government budget 
methodology, USCIS used the FY 2007 congressionally-enacted spending 
level as a baseline, before subtracting nonrecurring expenses and 
adding in inflation and additional resource requirements, to calculate 
application and petition fees. This budget accurately reflects USCIS' 
current spending as approved by the Congress.
    Consistent with its previous comprehensive fee review, USCIS used 
the FY 2007 budget as a baseline, before subtracting nonrecurring 
expenses and adding in inflation and additional resource requirements, 
to calculate application and petition fees. In addition, prior to the 
start of FY 2007, USCIS leadership conducted an extensive evaluation of 
its FY 2007 spending. This level of scrutiny has enabled USCIS to meet 
several service delivery goals, such as eliminating the application and 
petition backlog. The scrutiny employed in analyzing the USCIS cost 
structure and future needs should minimize misused resources. Thus, 
USCIS disagrees with the assertion that its current expenditures are 
inefficient.
    Another commenter suggested that USCIS use the actual time it took 
to perform the various immigration adjudication and naturalization 
activities, with no analysis of whether USCIS could operate its program 
more efficiently and for a reduced cost to those paying fees, thereby 
implying that greater efficiencies could be factored into the proposed 
fees.
    USCIS disagrees with this suggestion. To the extent practical, 
USCIS has factored into the fees those efficiencies that can be 
predicted (particularly enhancements). USCIS is firmly committed to 
seeking new ways of doing business and reengineering processes in order 
to contain costs and pass on the savings to all of our customers, and 
the new fee structure will enable USCIS to make improvements that will 
ultimately help reduce USCIS costs. Productivity enhancements that 
affect hours per completion calculations produce lower cost per unit. 
Process improvements implemented over the past several years, as well 
as projected productivity increases, were taken into account in the 
current fee review, keeping fees lower than they might otherwise have 
been. Specifically, this fee increase reflects USCIS' commitment to a 
projected four percent increase in productivity for Adjustment of 
Status Application processing, and a two percent increase in 
productivity for all other applications and petitions. USCIS will 
remain accountable for these projected productivity increases in order 
for fees to support operations as intended.
    Another commenter expressed concerns about the level of scrutiny in

[[Page 29869]]

identifying the amount of the additional resource requirements or 
enhancements. These costs were subject to the same level of scrutiny as 
all other USCIS costs. The additional resource requirements have been 
carefully reviewed by both DHS and OMB to ensure accuracy, and are 
displayed (with assumptions) in the supporting fee review documentation 
on the docket. USCIS provided this detailed information for 
transparency purposes to facilitate public scrutiny during the sixty-
day public comment period.
3. ``Make Determination'' Activity
    A few commenters questioned the calculation of the ``Make 
Determination'' activity cost estimates as well as the volume estimates 
used in the fee review. As explained in the proposed rule and the fee 
review supporting documentation, ``Make Determination'' costs were 
assigned to the applications and petitions by completion rates (level 
of effort or complexity) and workload volume. USCIS uses the most 
current and accurate completion rates and workload volumes provided by 
the USCIS Performance Analysis System. USCIS adjusts these workload 
volumes to reflect filing trends in FY 2007 and projected changes for 
FY 2008/2009. The USCIS Workload and Fee Projection Group leverages a 
time series model based on a regression analysis over the last fifteen 
years, with the most recent data trends given the greatest weight.
    The commenters quoted two particular instances of concern, one 
being the variance between the Application to Preserve Residence (with 
a completion rate of 3.39 hours and a make determination cost of $428) 
and Petition for Amerasian, Widow(er), or Special Immigrant (with a 
completion rate of 3.21 hours and a make determination cost of $2,268); 
and the other being the variance between the Application To Extend/
Change Nonimmigrant Status, Form I-539 (with a completion rate of 1.32 
hours at the local office and 0.39 hours at the service center and a 
make determination cost of $84), and the Petition to Remove Conditions 
of Residence, Form I-751 (with a completion rate of 1.36 hours at the 
local office and 0.46 hours at the service center and a make 
determination cost of $210). These variations are driven by the volumes 
associated with each application. In the first instance, the workload 
volume of Application to Preserve Residence filings is equal to the 
fee-paying volume (669), which means that the costs to process these 
applications are spread to an equal amount of applications for which a 
fee is received. The fee-paying volume of the Petition for Amerasian, 
Widow(er), or Special Immigrant is much less than the workload volume 
(4,772 compared to 16,000) resulting in costs being spread to fewer 
applications and, consequently, a higher Make Determination cost. The 
second instance is simply a case of costs being spread to a greater 
number of applications (220,000 for Application To Extend/Change 
Nonimmigrant Status compared to 143,000 for the Petition to Remove 
Conditions of Residence) resulting in a lower unit cost. After 
reviewing these comments, USCIS remains convinced that the calculations 
are correct.
    One commenter also questioned why the costs for an Application for 
EAD are significantly higher than the Application for LPR Card costs, 
when Application for EAD completion rates for local offices, service 
centers, and National Benefits Center are lower than the Application 
for LPR Card completion rates. As stated in the proposed rule, $11.5 
million in Application Support Center contract costs directly support 
processing an Application for LPR Card. Therefore, this cost comparison 
cannot be fairly analyzed by solely looking at the completion rates at 
local offices, service centers, or the National Benefits Center since a 
significant portion of the work is performed outside these offices.
4. Activity-Based Costing
    A few commenters suggested that USCIS' activity-based costing 
analysis was flawed since USCIS included completion rates for local 
offices that no longer have jurisdiction or responsibility to process 
certain form types (e.g., Nonimmigrant Worker Petition, Form I-129; 
Petition for Alien Fiance(e), Form I-129F; Alien Employee Petition, 
Form I-140; Application To Extend/Change Nonimmigrant Status, Form I-
539; Petition by Entrepreneur to Remove Conditions, Form I-829), and 
service centers that do not have jurisdiction or responsibility to 
process certain forms (e.g. Application to Preserve Residence for 
Naturalization Purposes, Form N-470). While it is true that certain 
USCIS offices have primary jurisdiction over particular form types, it 
is not uncommon for form types to be processed at other USCIS offices 
for various reasons. For example, service centers will refer cases to 
local offices for interview. These volumes, however, are relatively 
small, and, therefore, the cost impact is minimal. For example, of the 
439 Application to Preserve Residence filings processed in FY 2006, 
USCIS processed 427 (or 97 percent) at local offices and twelve (or 3.0 
percent) at service centers.
    A commenter questioned why the Naturalization Application is filed 
at service centers, but no completion rate data is provided for service 
center processing. Completion rate data is displayed for local offices 
instead of service centers for this benefit because the local offices 
perform the adjudication. Using completion rate data for benefits that 
are only received at Service Centers and not adjudicated would not be 
accurate.
    Another commenter suggested that it is simply not credible that 
local offices spend an average of two hours processing each Alien 
Employee Petition, when service centers only spend 52 minutes on an 
Alien Employee Petition. For various reasons, more complex cases are 
referred to local offices for an interview, explaining why the 
completion rate varies from service center to local office. However, as 
previously stated, the volumes are relatively small for these cases, 
and therefore the cost impact is minimal.
    A commenter also questioned the increased fee for the Application 
for EAD, stating that the proposed fee is inaccurate given that USCIS 
implemented a new policy to no longer issue interim EADs at local 
offices. Because local offices have higher completion rates than other 
offices for this benefit, the commenter stated that the fee should be 
re-calculated and reduced. Although USCIS has implemented a new policy 
to no longer issue interim EADs at local offices, the practice of where 
the adjudication takes place has not changed. Local offices will 
continue to adjudicate Application for EAD filings and, therefore, 
USCIS believes the fee is accurate as stated in the proposed rule.
5. Calculating Specific Processing Requirements
    One commenter remodeled the costs for the fee increase for an 
Adjustment of Status Application and questioned the 66 percent fee 
increase calculation after consolidating the fees for the Application 
for EAD that previously required additional fees. The commenter stated 
that if the Adjustment of Status Application processing time is seven 
months as stated in the proposed rule, then applicants pay for only one 
Application for EAD and one Adjustment of Status Application, for fees 
of $675, not what USCIS assumed for two Applications for EAD and one 
Adjustment of Status Application, for fees of approximately $800. The 
processing times identified in the proposed rule represent the 
processing

[[Page 29870]]

times for applications and petitions within USCIS control. When 
including the volume of Adjustment of Status Applications that are not 
within USCIS control, the processing times for the Adjustment of Status 
Applications in total are closer to one year. With a processing time of 
one year, the average applicant normally would pay for two employment 
authorizations, not one. Therefore, the USCIS calculation is correct.
6. Overhead Charges
    One commenter questioned the methodology behind incorporating 
overhead costs into the processing costs for each application and 
petition, suggesting that these costs are not connected to actually 
moving an application or petition forward. The goal of the fee review 
is to recover the resources necessary to fund the full cost of 
processing immigration benefit applications and petitions for which 
USCIS charges a fee, plus the cost of similar services provided at no 
cost. Overhead items, such as the rent necessary to house Adjudication 
Officers, are vital to the operation of USCIS and are not a means for 
hiding expenditures, as suggested. These costs were spread in a pro 
rata fashion to the processing activities based on the number of 
government employees and the specific schedules of required space. That 
is, the more government staff time associated with a processing 
activity, the higher the overhead costs associated with that activity. 
Further detail of the overhead cost calculation, including the number 
of government staff per office and the identification of overhead 
items, are provided in the fee review supporting documentation 
available on the docket.
7. Recovering Deficit From Current Operations
    One commenter addressed the fact that USCIS is losing money on each 
application and petition now being filed in advance of the increase and 
questioned whether the increase in fees was intended to recover these 
losses. The fee increase is not intended to recover the losses 
currently being sustained by USCIS or for retiring any accumulated 
deficits. USCIS is currently closing a funding gap created by the 
insufficiency of the fee schedule by relying on spending cuts to 
critical programs and services, premium processing revenues, interim 
benefit revenues, and revenues from temporary programs to fund base 
operations. The fees are designed to recover the costs of operations in 
the future and are not retroactive.
    The commenter also noted the decrease in the projected number of 
Application for LPR Card filings and the recent surges in 
Naturalization Application filings. The commenter expressed concern 
that USCIS did not explain the projected decline in Application for LPR 
Card filings and wanted to know the impact if volumes declined more 
than what was projected in the fee review (e.g., Naturalization 
Applications). As identified in the workload assumptions of the fee 
review supporting documentation, the decline in projected Application 
for LPR Card filings is due to the increase in projected Naturalization 
Application filings. Projections are not expected to vary widely from 
those in the fee review. Regardless, USCIS' new fee model enables USCIS 
to adjust fees in a timely manner and USCIS plans to continuously 
review fees. If unforeseen costs or volumes result in fees that are not 
recovering full costs, a new fee schedule may be proposed before the 
fee review that is required by OMB Circular A-25 and law to be 
undertaken in two years.
8. Charging a Flat Fee
    At least one commenter suggested that USCIS should change its 
methodology and charge the same fee amount regardless of the complexity 
of the immigration benefit. Fees based on the complexity of the 
application or petition are consistent with standard cost accounting 
practices and are also consistent with USCIS' past fee setting 
practices. USCIS does not agree that charging the same fee, regardless 
of the benefit, is a better methodology. USCIS believes that applicants 
and petitioners should generally pay a reasonable fee commensurate with 
the level of effort required to adjudicate such application or 
petition.
9. Financial Audits
    Some commenters suggested that USCIS' costs should be subject to an 
audit. Federal law already requires an annual audit of financial 
activity, including cost, revenues, and payments for all executive 
agencies. 31 U.S.C. 3521, 7501-7506. USCIS costs are included in DHS's 
financial statements. The DHS Office of Inspector General (OIG) employs 
an independent public accounting firm to audit all DHS and component 
financial statements. In addition, GAO and OIG conduct reviews of the 
effectiveness and efficiency of USCIS programs and operations, 
providing recommendations for improvements.
10. Acceptance of Electronic Payment Options
    Several comments recommended USCIS accept credit cards for all 
filings, both for convenience and also to let filers take advantage of 
the credit aspect of the card, to pay the amount to their credit card 
vendor over time, pointing out that this would slightly soften the 
impact of the new fees. While the commenters' suggestion cannot be 
implemented at this time, USCIS plans to expand electronic payment 
acceptance over time as it shifts receipting of applications and 
petitions to other platforms such as lockboxes operated by the 
Department of the Treasury.
11. Other USCIS Fees
    One commenter questioned whether USCIS is fully accounting for all 
its other fee revenues. The commenter noted an additional $44 million 
in fee revenues from other accounts as noted in the FY 2006 budget 
request, and asked specifically about disposition of the money from the 
anti-fraud fee under section 286(v) of the INA, 8 U.S.C. 1356(v). As 
noted in the proposed rule, in addition to the IEFA, USCIS receives fee 
funding from several smaller, specific accounts, such as the H-1B 
Nonimmigrant Petitioner Account under section 286(s) of the Act, 8 
U.S.C. 1356(s), and the Fraud Prevention and Detection Account under 
section 286(v) of the Act, 8 U.S.C. 1356(v), which this proposed rule 
does not affect.
    In FY 2006, the Congress enacted $31 million for activities funded 
from the Fraud Prevention and Detection Account. The requested amount 
is set by statute providing USCIS with one-third of the fraud fees 
collected for the H1-B, H2-B, and L visas and applied to fraud 
prevention and detection activities. The proposed rule addresses the 
costs of processing immigration and naturalization benefit applications 
and petitions, biometric services, and associated support services of 
the IEFA, which is in addition to the costs for activities funded from 
the Fraud Prevention and Detection Account.

IV. Statutory and Regulatory Reviews

A. Regulatory Flexibility Act

    In accordance with the Regulatory Flexibility Act, 5 U.S.C. 601(6), 
USCIS examined the impact of this rule on small entities. A small 
entity may be a small business (defined as any independently owned and 
operated business not dominant in its field that qualifies as a small 
business per the Small Business Act, 15 U.S.C. 632), a small not-for-
profit organization, or a

[[Page 29871]]

small governmental jurisdiction (locality with fewer than fifty 
thousand people). USCIS determined which entities were small by using 
the definitions supplied by the Small Business Administration. The size 
of the companies was determined by using the ReferenceUSA databases at 
http://www.referenceusa.com/. Below is a summary of the small entity 
analysis. A more detailed analysis is available in the rulemaking 
docket.
    Individuals rather than small entities submit the majority of 
immigration and naturalization benefit applications and petitions. 
Entities that would be affected by this rule are those that file and 
pay the alien's fees for certain immigration benefit applications. 
These applications include the Nonimmigrant Worker Petition and the 
Alien Employee Petition. USCIS conducted a statistically valid sample 
analysis of applicants of these application types to determine if this 
rule has an economically significant impact on a substantial number of 
small entities.
    Out of the 439,000 applications filed in FY 2005 for these 
application types, USCIS first identified the minimum sample size that 
was large enough to achieve a 95 percent confidence level. This sample 
size was identified as 383 (out of a total of 149,658 unique entities 
that filed applications in FY 2005). USCIS then randomly selected 653 
entities, of which 561 or 86 percent were classified as small entities. 
Therefore, USCIS determined that a substantial number of small entities 
are impacted by this rule. This determination was not updated based on 
FY 2006 or FY 2007 applications since programs have not substantially 
changed and the percentage of small business applicants is expected to 
remain fairly constant.
    USCIS then analyzed the economic impact on small entities of this 
rule by: (1) Identifying the number of applications filed by the small 
entities having sales revenue data identified by the random sample and 
(2) multiplying the number of applications by the fee increase 
associated with the applicable application types in order to estimate 
the increased annual burden imposed by this rulemaking. Once USCIS 
determined the additional cost of this rulemaking on the randomly 
selected small entities, USCIS divided this total increased cost by the 
annual sales revenue of the entity. By comparing the cost increases 
imposed by this rulemaking with the sales revenue of the impacted small 
entities, USCIS was able to understand the economic impact of this rule 
on the individual small entities USCIS has sampled. Using the 
ReferenceUSA database of business information, USCIS was able to 
identify annual sales revenue estimates for 273 of the 561 small 
entities previously sampled. Of the 273 small entities, 213 or about 78 
percent of the small entities exhibited an impact of less than one 
tenth of one percent of sales revenue, and all of the small entities 
sampled exhibited an impact of less than one percent of total revenue. 
A simple (non-weighted) average of the 273 small entities equated to an 
overall impact of only six one hundredths of one percent of sales 
revenue. Therefore, USCIS believes that a substantial number of small 
entities are not significantly impacted economically by this rule.
    One comment was received on the USCIS determination that a 
substantial number of small entities are not significantly impacted 
economically by this rule. First, the commenter suggested that the 
sample size used to make this determination was too small to provide an 
accurate picture of the rule's impact on small firms. Second, the 
commenter suggested that USCIS failed to consider that many firms pay 
for an alien's individual immigration benefit application fee in 
addition to those incurred by the business.
    The sample size used by USCIS was statistically valid to allow 
USCIS to estimate the rule's impact on small entities. In the initial 
regulatory flexibility analysis, USCIS determined that 86 percent of 
the affected entities were small entities using Small Business 
Administration classifications. Eighty-six percent represents a 
significant majority. More importantly, USCIS compared the cost 
increases imposed by this rulemaking with the sales revenue of the 
impacted small entities and determined that the rule would, on average, 
have an impact of only 0.063 percent of sales revenue.
    The commenter is correct that USCIS did not consider the effect on 
firms that choose to pay alien's individual immigration benefit 
application fee to induce the alien to accept a position with their 
firm. The Immigration Benefit Application and Petition Fee Schedule is 
established based on the assumption that an individual alien will pay 
his or her own application or petition fees and does not impose any 
regulatory requirement on a firm to pay fees for their employees. A 
business may choose to assist an employee in that manner; however, 
since it is not a direct cost imposed by USCIS on the firm, it was not 
a consideration for the analysis of the impacts of this rule.
    The employment-based visa programs of USCIS are predominately used 
by small businesses, 86 percent as determined by the initial regulatory 
flexibility analysis. After the changes made in this rule, the 
participating firms will still be predominantly small. Nonetheless, 
while a significant number of small businesses are affected, USCIS has 
determined that the effects on these small businesses are not 
sufficiently significant to exceed this rule's benefits or require 
adjustments in the rule's requirements based on the size of a 
petitioner's business. If fee discounts or exceptions were allowed for 
employment-based immigration benefits based on firm size, the 
predomination of small firms in the programs would result in the small 
percentage of larger firms that participate being required to pay an 
inordinate portion of the costs of adjudicating employment-based 
immigration petitions. Further, USCIS has determined that, even for a 
small entity, the amount of the fees established in the USCIS 
Immigration Benefit Application and Petition Fee Schedule are so small 
as to impose no significant financial or compliance burden on such 
firms.
    In summary, although the analysis shows that this rulemaking would 
affect a substantial number of small entities, the economic impact of 
this rule was found to be negligible. This rule has been reviewed in 
accordance with 5 U.S.C. 605(b), and the Department of Homeland 
Security certifies that this rule will not have a significant economic 
impact on a substantial number of small entities. Thus, USCIS is 
required to take no steps to minimize or mitigate the effects of this 
rule on small entities.

B. Unfunded Mandates Reform Act of 1995

    The Unfunded Mandates Reform Act of 1995 requires certain actions 
to be taken before an agency promulgates any notice of rulemaking 
``that is likely to result in promulgation of any rule that includes 
any Federal mandate that may result in the expenditure by State, local 
and tribal governments, in the aggregate, or by the private sector, of 
one hundred million or more (adjusted annually for inflation) in any 
one year.'' 2 U.S.C. 1532(a). While this rule may result in the 
expenditure of more than one hundred million by the private sector 
annually, the rulemaking is not a ``Federal mandate'' as defined for 
these purposes, 2 U.S.C. 658(6), as the payment of application and 
petition fees by individuals 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, applying for immigration 
status in the United States.

[[Page 29872]]

2 U.S.C. 658(7)(A)(ii). Therefore, no actions were deemed necessary 
under the provisions of the UMRA.

C. Small Business Regulatory Enforcement Fairness Act of 1996

    This rulemaking is a major rule as defined by section 804 of the 
Small Business Regulatory Enforcement Act of 1996. This rulemaking will 
result in an annual effect on the economy of more than $100 million, in 
order to generate the revenue necessary to fully fund the increased 
cost associated with the processing of immigration benefit applications 
and associated support benefits; the full cost of providing similar 
benefits to asylum and refugee applicants; and the full cost of similar 
benefits provided to other immigrants, as specified in the regulation, 
at no charge. The increased costs will be recovered through the fees 
charged for various immigration benefit applications.

D. Executive Order 12866

    This rule is considered by the Department of Homeland Security to 
be an economically significant regulatory action under Executive Order 
12866, section 3(f), Regulatory Planning and Review. The implementation 
of this rule would provide USCIS with an additional $1.081 billion in 
FY 2008 and FY 2009 in annual fee revenue, based on a projected annual 
fee-paying volume of 4.742 million applications/petitions and 2.196 
million requests for biometric services, over the fee revenue that 
would be collected under the current fee structure. This increase in 
revenue will be used pursuant to subsections 286(m) and (n) of the Act, 
8 U.S.C. 1356(m) and (n), to fund the full costs of processing 
immigration benefit applications and associated support benefits; the 
full cost of providing similar benefits to asylum and refugee 
applicants; and the full cost of similar benefits provided to other 
immigrants at no charge. If USCIS does not adjust the current fees to 
recover the full costs of processing immigration benefit applications, 
USCIS will be forced to implement significant spending reductions 
resulting in a reversal of the considerable progress it has made over 
the last several years to reduce the backlog of immigration benefit 
applications and petitions, to increase the integrity of the 
immigration benefit system, and to protect national security and public 
safety. The revenue increase is based on USCIS costs and projected 
volumes that were available at the time the proposed rule was drafted. 
USCIS has placed in the rulemaking docket a detailed analysis that 
explains the basis for the annual fee increase. Accordingly, this rule 
has been reviewed by the Office of Management and Budget.
    In response to the proposed rule, one commenter expressly 
questioned the rule's benefit and cost analysis. This commenter stated 
that USCIS had not conducted a sufficient analysis of the costs, 
benefits, and, foreseeable consequences of the fees proposed. The 
commenter is correct that USCIS is required under Executive Order 12866 
to perform an analysis of this benefits and costs of this rule that 
complies with OMB Circular A-4, Regulatory Analysis (09/17/2003) (OMB 
Circular A-4). However, as A-4 states, ``There are justifications for 
regulations in addition to correcting market failures. A regulation may 
be appropriate when you have a clearly identified measure that can make 
government operate more efficiently.'' The need for this final rule is 
not based on economics or a failure of the private markets to address a 
problem but, rather, on enhancing the ability of USCIS to advance its 
goal of improving the delivery of immigration programs. This rule is 
intended to correct breakdowns in the delivery of immigration benefit 
programs that have occurred as a result of the currently inadequate fee 
schedule. Further, as OMB Circular A-4 states, ``It will not always be 
possible to express in monetary units all of the important benefits and 
costs.'' The net economic effects of this rule are difficult if not 
impossible to determine.
    The public policy rationale behind the United States immigration 
policies are well known and the benefit of immigrants to the United 
States and its citizens are enormous, as reiterated in the thousands of 
comments received on the proposed rule. As stated throughout the 
proposed rule and repeated often in this final rule, the fees 
established by this rule are necessary to update and modernize the 
USCIS infrastructure. The fee amounts comport with methodology required 
by OMB and meet both government and private sector standards. Also, 
while an equilibrium analysis has not been performed, the demand for 
immigration benefits obviously and greatly exceeds the availability of 
such benefits. Thus, these fees will have no impact on application 
volumes or any other public behavior. If USCIS can cover its expenses, 
delays in processing benefits and complaints about USCIS service will 
abate. That is a tangible and noticeable benefit. Thus, the benefits of 
this rule exceed its costs. OMB has reviewed this rule and concurs in 
this conclusion.
    One commenter stated that USCIS did not consider the potential 
costs and benefits of pursuing possible alternative funding sources. 
This comment is similar to many comments suggesting that USCIS must 
pursue a Congressional appropriation that were addressed earlier. With 
regard to the analysis of the benefits or pursuing alternative funding 
sources, these comments are beyond the scope of the regulation. USCIS 
is limited to this rulemaking as an affirmative source of addressing 
shortfall in its revenues under section 286(m) of the INA, 8 U.S.C. 
1356(m). If Congress provides funds for USCIS operations, the benefits 
of that action, especially as it relates to persons who pay fees, are 
self evident. An in-depth economic analysis is not required for USCIS 
to recognize that fact. With regard to ``benefits of pursuing possible 
alternative funding,'' USCIS sees no benefit and only costs to be 
realized from such a pursuit. Congress is well aware of the funding 
scheme described in this rule.

E. Executive Order 13132

    This rulemaking will not have 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. Therefore, in accordance with section 6 
of Executive Order 13132, the Department of Homeland Security has 
determined that this rulemaking does not have sufficient Federalism 
implications to warrant the preparation of a federalism summary impact 
statement.

F. Executive Order 12988

    This rule meets the applicable standards set forth in sections 3(a) 
and 3(b)(2) of Executive Order 12988.

G. Paperwork Reduction Act

    Under the Paperwork Reduction Act of 1995, Public Law 104-13, 109 
Stat. 163 (1995) (PRA), all Departments are required to submit to OMB, 
for review and approval, any reporting or recordkeeping requirements 
inherent in a rule. This rulemaking does not impose any new reporting 
or recordkeeping requirements under the Paperwork Reduction Act.
    The changes to the fees will require minor amendments to 
applications and petitions to reflect the new fees. In addition, this 
rule anticipates (but is not dependent on) consolidating the 
Application for Travel Document and Application for EAD into the 
Application of Adjustment of Status since applicants will not be 
required to

[[Page 29873]]

file three separate application types in order to apply for adjustment 
of status, travel documents, and employment authorization. This change 
will reduce paperwork burdens on these applicants. The necessary 
revisions to the approved information collection burden for any new or 
revised applications will be submitted to OMB for approval before being 
issued for use by USCIS as required under the PRA and 5 CFR 1320.
    Since the forms will be amended to reflect the new fees, USCIS will 
submit the appropriate requests for non-substantive change to OMB to 
reflect the additional costs.

List of Subjects in 8 CFR Part 103

    Administrative practice and procedures; Authority delegations 
(government agencies); Freedom of Information; Privacy; Reporting and 
recordkeeping requirements; and Surety bonds.

0
Accordingly, part 103 of chapter I of title 8 of the Code of Federal 
Regulations is amended as follows:

PART 103--POWERS AND DUTIES; AVAILABILITY OF RECORDS

0
1. The authority citation for part 103 continues to read as follows:

    Authority: 5 U.S.C. 301, 552, 552(a); 8 U.S.C. 1101, 1103, 1304, 
1356; 31 U.S.C. 9701; Public Law 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.


0
2. Section 103.7 is amended by:
0
a. Removing the entries for ``Form I-506'' ``Form I-914'' and 
``Motion'' in paragraph (b)(1);
0
b. Revising the entries ``For capturing biometric information'' and the 
entries for forms ``I-90, I-102, I-129, I-129F, I-130, I-131, I-140, I-
191, I-192, I-193, I-212, I-290B, I-360, I-485, I-526, I-539, I-600, I-
600A, I-601, I-612, I-687, I-690, I-694, I-695, I-698, I-751, I-765, I-
817, I-824, I-829, N-300, N-336, N-400, N-470, N-565, N-600, and N-
600K''in paragraph (b)(1); and by
0
c. Adding paragraph (c)(5).
    The revisions and addition read as follows:


Sec.  103.7  Fees.

* * * * *
    (b) * * *
    (1) * * *
* * * * *
    For capturing biometric information (Biometric Fee). A service fee 
of $80 will be charged for any individual who is required to have 
biometric information captured in connection with an application or 
petition for certain immigration and naturalization benefits (other 
than asylum), and whose residence is in the United States; provided 
that: Extension for intercountry adoptions: If applicable, no biometric 
service fee is charged when a written request for an extension of the 
approval period is received by USCIS prior to the expiration date of 
approval indicated on the Form I-171H if a Form I-600 has not yet been 
submitted in connection with an approved Form I-600A. This extension 
without fee is limited to one occasion. If the approval extension 
expires prior to submission of an associated Form I-600, then a 
complete application and fee must be submitted for a subsequent 
application.
* * * * *
    Form I-90. For filing an application for a Permanent Resident Card 
(Form I-551) in lieu of an obsolete card or in lieu of one lost, 
mutilated, or destroyed, or for a change in name--$290.
* * * * *
    Form I-102. For filing a petition for an application (Form I-102) 
for Arrival/Departure Record (Form I-94) or Crewman's Landing Permit 
(Form I-95), in lieu of one lost, mutilated, or destroyed--$320.
    Form I-129. For filing a petition for a nonimmigrant worker--$320.
    Form I-129F. For filing a petition to classify a nonimmigrant as a 
fianc[eacute]e or fianc[eacute] under section 214(d) of the Act--$455; 
no fee for a K-3 spouse as designated in 8 CFR 214.1(a)(2) who is the 
beneficiary of an immigrant petition filed by a United States citizen 
on Form I-130.
    Form I-130. For filing a petition to classify status of an alien 
relative for issuance of an immigrant visa under section 204(a) of the 
Act--$355.
    Form I-131. For filing an application for travel document--$305.
    Form I-140. For filing a petition to classify preference status of 
an alien on the basis of profession or occupation under section 204(a) 
of the Act--$475.
    Form I-191. For filing an application for discretionary relief 
under section 212(c) of the Act--$545.
    Form I-192. For filing an application for discretionary relief 
under section 212(d)(3) of the Act, except in an emergency case, or 
where the approval of the application is in the interest of the United 
States Government--$545.
    Form I-193. For filing an application for waiver of passport and/or 
visa--$545.
    Form I-212. For filing an application for permission to reapply for 
an excluded, deported or removed alien, an alien who has fallen into 
distress, an alien who has been removed as an alien enemy, or an alien 
who has been removed at government expense in lieu of deportation--
$545.
* * * * *
    Form I-290B. For filing an appeal from any decision under the 
immigration laws in any type of proceeding over which the Board of 
Immigration Appeals does not have appellate jurisdiction--$585 (the fee 
will be the same when an appeal is taken from the denial of a petition 
with one or multiple beneficiaries, provided that they are all covered 
by the same petition, and therefore, the same decision). Motions. For 
filing a motion to reopen or reconsider any DHS decision in any type of 
proceeding over which the Executive Office for Immigration Review does 
not have jurisdiction. This fee shall be charged whenever a motion is 
filed to reopen or reconsider a single decision, whether it applies to 
one or multiple beneficiaries--$585.
    Form I-360. For filing a petition for an Amerasian, Widow(er), or 
Special Immigrant--$375, except there is no fee for a petition seeking 
classification as: An Amerasian; a self-petitioning battered or abused 
spouse, parent, or child of a United States citizen or lawful permanent 
resident; or a Special Immigrant--Juvenile.
    Form I-485. For filing an application for permanent resident status 
or creation of a record of lawful permanent residence--$930 for an 
applicant fourteen years of age or older; $600 for an applicant under 
the age of fourteen years when submitted concurrently for adjudication 
with the Form I-485 of a parent and the applicant is seeking to adjust 
status as a derivative of the parent, based on a relationship to the 
same individual who provides the basis for the parent's adjustment of 
status, or under the same legal authority as the parent; no fee for an 
applicant filing as a refugee under section 209(a) of the Act; provided 
that no additional fee will be charged for a request for travel 
document (advance parole) or employment authorization filed by an 
applicant who has paid the Form I-485 application fee, regardless of 
whether the Form I-131 or Form I-765 is required to be filed by such 
applicant to receive these benefits.
* * * * *
    Form I-526. For filing a petition for an alien entrepreneur--
$1,435.
    Form I-539. For filing an application to extend or change 
nonimmigrant status--$300.
* * * * *
    Form I-600. For filing a petition to classify an orphan as an 
immediate

[[Page 29874]]

relative for issuance of an immigrant visa under section 204(a) of the 
Act. (When more than one petition is submitted by the same petitioner 
on behalf of orphans who are brothers or sisters, only one fee will be 
required.)--$670.
    Form I-600A. For filing an application for advance processing of 
orphan petition. (When more than one petition is submitted by the same 
petitioner on behalf of orphans who are brothers or sisters, only one 
fee will be required.)--$670. No fee is charged if Form I-600 has not 
yet been submitted in connection with an approved Form I-600A if a 
written request from the applicant for an extension of the approval has 
been received by USCIS prior to the expiration date of approval 
indicated on the Form I-171H. This extension will require an update of 
the applicant's home study and a determination from USCIS that proper 
care will be provided to an adopted orphan. A no fee extension is 
limited to one occasion. If the Form I-600A approval extension expires 
prior to submission of an associated Form I-600, then a complete 
application and fee must be submitted for any subsequent application.
    Form I-601. For filing an application for waiver of ground of 
inadmissibility under section 212(h) or (i) of the Act. (Only a single 
application and fee shall be required when the alien is applying 
simultaneously for a waiver under both sections 212(h) and (i).)--$545.
    Form I-612. For filing an application for waiver of the foreign-
residence requirement under section 212(e) of the Act--$545.
    Form I-687. For filing an application for status as a temporary 
resident under section 245A(a) of the Act. A fee of $710 for each 
application is required at the time of filing with the Department of 
Homeland Security.
    Form I-690. For filing an application for waiver of a ground of 
inadmissibility under section 212(a) of the Act as amended, in 
conjunction with the application under sections 210 or 245A of the Act, 
or a petition under section 210A of the Act--$185.
    Form I-694. For appealing the denial of an applications under 
sections 210 or 245A of the Act, or a petition under section 210A of 
the Act--$545.
    Form I-695. For filing an application for replacement of temporary 
resident card (Form I-688)--$130.
    Form I-698. For filing an application for adjustment from temporary 
resident status to that of lawful permanent resident under section 
245A(b)(1) of the Act. For applicants filing within thirty-one months 
from the date of adjustment to temporary resident status, a fee of 
$1,370 for each application is required at the time of filing with the 
Department of Homeland Security. For applicants filing after thirty-one 
months from the date of approval of temporary resident status, who file 
their applications on or after July 9, 1991, a fee of $1,410 is 
required. The adjustment date is the date of filing of the application 
for permanent residence or the applicant's eligibility date, whichever 
is later.
* * * * *
    Form I-751. For filing a petition to remove the conditions on 
residence, based on marriage--$465.
    Form I-765. For filing an application for employment authorization 
pursuant to 8 CFR 274a.13--$340.
* * * * *
    Form I-817. For filing an application for voluntary departure under 
the Family Unity Program--$440.
* * * * *
    Form I-824. For filing for action on an approved application or 
petition--$340.
    Form I-829. For filing a petition by entrepreneur to remove 
conditions--$2,850.
* * * * *
    Form N-300. For filing an application for declaration of 
intention--$235.
    Form N-336. For filing a request for hearing on a decision in 
naturalization proceedings under section 336 of the Act--$605.
    Form N-400. For filing an application for naturalization (other 
than such application filed on or after October 1, 2004, by an 
applicant who meets the requirements of sections 328 or 329 of the Act 
with respect to military service, for which no fee is charged)--$595.
* * * * *
    Form N-470. For filing an application for benefits under section 
316(b) or 317 of the Act--$305.
    Form N-565. For filing an application for a certificate of 
naturalization or declaration of intention in lieu of a certificate or 
declaration alleged to have been lost, mutilated, or destroyed; for a 
certificate of citizenship in a changed name under section 343(c) of 
the Act; or for a special certificate of naturalization to obtain 
recognition as a citizen of the United States by a foreign state under 
section 343(b) of the Act--$380.
    Form N-600. For filing an application for a certificate of 
citizenship under section 309(c) or section 341 of the Act--$460, for 
applications filed on behalf of a biological child and $420 for 
applications filed on behalf of an adopted child.
    Form N-600K. For filing an application for citizenship and issuance 
of certificate under section 322 of the Act--$460, for an application 
filed on behalf of a biological child and $420 for an application filed 
on behalf of an adopted child.
* * * * *
    (c) * * *
    (5) No fee relating to any application, petition, appeal, motion, 
or request made to United States Citizenship and Immigration Services 
may be waived under paragraph (c)(1) of this section except for the 
following: Biometrics; Form I-90; Form I-485 (only in the case of an 
alien in lawful nonimmigrant status under sections 101(a)(15)(T) or (U) 
of the Act; an applicant under section 209(b) of the Act; an approved 
self-petitioning battered or abused spouse, parent, or child of a 
United States citizen or lawful permanent resident; or an alien to whom 
section 212(a)(4) of the Act does not apply with respect to adjustment 
of status); Form I-751; Form I-765; Form I-817; Form N-300; Form N-336; 
Form N-400; Form N-470; Form N-565; Form N-600; Form N-600K; and Form 
I-290B and motions filed with United States Citizenship and Immigration 
Services relating to the specified forms in this paragraph (c).
* * * * *

     Dated: May 3, 2007.
Michael Chertoff,
Secretary.
 [FR Doc. E7-10371 Filed 5-29-07; 8:45 am]
BILLING CODE 4410-10-P