[Federal Register Volume 64, Number 152 (Monday, August 9, 1999)]
[Proposed Rules]
[Pages 43103-43114]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-20113]
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Proposed Rules
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains notices to the public of
the proposed issuance of rules and regulations. The purpose of these
notices is to give interested persons an opportunity to participate in
the rule making prior to the adoption of the final rules.
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Federal Register / Vol. 64, No. 152 / Monday, August 9, 1999 /
Proposed Rules
[[Page 43103]]
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DEPARTMENT OF AGRICULTURE
Animal and Plant Health Inspection Service
7 CFR Part 354
[Docket No. 98-073-1]
RIN 0579-AB05
User Fees; Agricultural Quarantine and Inspection Services
AGENCY: Animal and Plant Health Inspection Service, USDA.
ACTION: Proposed rule.
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SUMMARY: We are proposing to amend the user fee regulations by
adjusting the fees charged for certain agricultural quarantine and
inspection services we provide in connection with certain commercial
vessels, commercial trucks, commercial railroad cars, commercial
aircraft, and international airline passengers arriving at ports in the
customs territory of the United States. The adjusted fees would cover
fiscal years 2000 through 2002. We have determined that the fees must
be adjusted to reflect the anticipated actual cost of providing these
services through FY 2002.
DATES: We invite you to comment. We will consider all comments that we
receive by October 8, 1999.
ADDRESSES: Please send an original and three copies of your comments to
Docket No. 98-073-1, Regulatory Analysis and Development, PPD, APHIS,
suite 3CO3, 4700 River Road Unit 118, Riverdale, MD 20737-1238. Please
state that your comments refer to Docket No. 98-073-1. Comments
received may be inspected at USDA, room 1141, South Building, 14th
Street and Independence Avenue SW., Washington, DC, between 8 a.m. and
4:30 p.m., Monday through Friday, except holidays.
FOR FURTHER INFORMATION CONTACT: For information concerning program
Operations, contact Mr. Jim Smith, Operations Officer, Program Support,
PPQ, APHIS, 4700 River Road Unit 60, Riverdale, MD 20737-1236, (301)
734-8295. For information concerning rate development, contact Ms.
Donna Ford, PPQ User Fees Section Head, FSSB, BASE, ABS, APHIS, 4700
River Road Unit 54, Riverdale, MD 20737-1232, (301) 734-8351.
SUPPLEMENTARY INFORMATION:
Background
Section 2509(a) of the Food, Agriculture, Conservation, and Trade
Act of 1990 (21 U.S.C. 136a), referred to below as the FACT Act,
authorizes the Animal and Plant Health Inspection Service (APHIS) to
collect user fees for agricultural quarantine and inspection (AQI)
services. The FACT Act was amended by Sec. 504 of the Federal
Agricultural Improvement and Reform Act of 1996 (Pub. L. 104-127), on
April 4, 1996.
The FACT Act, as amended, authorizes APHIS to collect user fees for
providing AQI services in connection with the arrival, at a port in the
customs territory of the United States, of:
Commercial vessels,
Commercial trucks,
Commercial railroad cars,
Commercial aircraft, and
International airline passengers.
According to the FACT Act, as amended, these user fees should recover
the costs of:
Providing the AQI services listed above,
Providing preclearance or preinspection at a site outside the
customs territory of the United States to such passengers and vehicles,
Administering the user fee program, and
Maintaining a reasonable balance in the Agricultural
Quarantine Inspection User Fee Account (AQI account).
Introduction
On July 24, 1997, we published in the Federal Register (62 FR
39747-39755, Docket No. 96-038-3) a rule amending the user fees and
setting user fees in advance for AQI services for fiscal years 1997
through 2002.
APHIS has had to provide AQI services beyond what we anticipated
when the currently scheduled fees were set in 1997. The increases in
services stem from an increase in international trade and travel,
necessitating more inspections at ports of arrival, changes in our
regulations that result in our having to inspect additional imported
articles, and enhanced efforts to crack down on the smuggling of
agricultural commodities. These increases in service are discussed in
more detail below, under the heading ``New AQI Program Costs.''
In this document, we are proposing to amend those fees for fiscal
years 2000 through 2002 in order to compensate for increased AQI
program costs and to reestablish a reasonable reserve in the AQI
account.
Because rulemaking takes time, we anticipate that the revised user
fees will not take effect until at least the second quarter of FY 2000.
Therefore, some of the calculations on the following pages, which
assume an implementation date of October 1, 1999, will have to be
revised when the final rule is published.
We plan to publish a notice in the Federal Register prior to the
beginning of each fiscal year to remind or notify the public of the
user fees for that particular fiscal year.
We also intend to monitor our fees throughout each year and look
closely at adjustments to fees that may be needed in future years. If
we determine that any fees are too high and are contributing to
unreasonably high reserve levels, we will publish lower fees in the
Federal Register and make them effective as quickly as possible. If it
becomes necessary to increase any fees because reserve levels are being
drawn too low, we will publish, for public comment, proposed fee
increases in the Federal Register.
New AQI Program Costs
APHIS is continually requested to process international airline
passengers faster, although we need to inspect passengers and their
baggage thoroughly to safeguard against the introduction of harmful
pests and diseases of animals and plants. We are committed to
processing passengers as quickly as possible, without jeopardizing the
success of AQI, whose purpose is to prevent the introduction of foreign
plant and animal pests and diseases which are harmful to this country's
agriculture; however, faster processing requires more officers,
additional canine teams, and the purchase of state-of-the-art high
definition x-ray machines at the medium and large ports throughout the
country. The new high definition x-ray machines, estimated to cost
$600,000
[[Page 43104]]
each, will greatly enhance the processing of passengers and reduce
further need for more inspectors. Due to the expense involved, we plan
to purchase these machines for the busiest ports to make optimal use of
the machines.
New and expanding airport terminals are also increasing the demand
for AQI services at areas in airports where we do not currently have
officers located. In the past, we were able to quickly clear
passengers, because most passengers arrived in the same general area of
the airport. Not only is the number of passengers increasing, but
additional international terminals are being built in new locations,
requiring additional officers and canine teams to keep up with demand
for service.
At the same time, we are trying to meet the constant demands from
brokers and shippers to clear cargo faster at various locations. In
many instances, in order to move cargo quickly, we must conduct both
initial and final inspections. Since we cannot hold cargo up at the
port to conduct a full inspection, we inspect a sampling of cargo at
the port of first arrival and conduct a more thorough inspection at the
final destination when the cargo is off-loaded. This requires
additional officers at the port of first arrival to cover the
increasing numbers of inspection locations, and new officers at final
destination points to conduct additional inspection services.
Further, inspection activities have increased as a result of recent
rulemakings. For example, additional inspections are necessary to
implement new regulations intended to prevent the introduction of pests
in imported solid wood packing material (see 63 FR 50100-50111 and 63
FR 69539-69543).
AQI services related to enforcing our regulations have also
expanded. APHIS compliance officers work in teams with local
authorities to detect, investigate, and prosecute violators. Recent
increased efforts include both border blitzes and market surveys.
Border blitzes involve unannounced, targeted inspections, as well
as random searches of cargo containers entering the United States where
no AQI staffing exists, at times when staffing is not usually provided,
or where existing staff must be supplemented. Market surveys consist of
searches in grocery stores, plant stores, and fruit and vegetable
markets for prohibited items.
When prohibited items are detected, follow-up investigations are
conducted to identify the item's origin and the responsible shippers,
importers, and brokers. Previous shipments and their destination points
are researched, located, and investigated for other prohibited items
and infested materials. This information is being used to develop a
violation database to help the teams target specific commodities and
importers who have a history of smuggling prohibited commodities, and
allow legitimate importers and exporters to move their products through
commerce without undue delay.
These activities are supported by many agricultural industries, who
see them as positive steps toward detecting and eliminating plant and
animal pests and diseases before they can become established in the
United States.
Projected AQI Program Costs for Fiscal Years 1999-2002
The following table shows the total projected costs of
administering the AQI program for fiscal years 1999 through 2002. When
we projected costs for fiscal years 1999 through 2002, we began with
the base need of $130,001,000 for Plant Protection and Quarantine
(PPQ), the APHIS unit that administers the AQI program in the United
States. The base need of PPQ is an increase of approximately $3.6
million in PPQ's base need as identified in the July 14, 1997, final
rule, and is due to unanticipated personnel compensation of $1.6
million for additional Civil Service Retirement assessments, higher
overtime costs of approximately $1.4 million, and additional pay cost
increases of $600,000. (The base need of PPQ simply reflects the cost
required for APHIS to be prepared to provide AQI services at all
international ports in the United States, without taking into account
the additional annual costs shown in the following table. The base need
is not affected by projected changes in the volumes of each category of
service.)
We then added new annual costs associated with increased PPQ
activities in the United States to project the total AQI program costs
to PPQ for fiscal years 1999 through 2002.
International Services is the APHIS program that administers the
AQI program in foreign regions. We projected the annual costs to
International Services of providing international preclearance services
for fiscal years 1999 through 2002 based on FY 1998 program costs plus
new costs associated with preclearance activities in Bermuda and the
Bahamas. The projected International Services annual costs were then
added to PPQ's annual costs to arrive at projected AQI annual program
cost subtotals.
We then added agency support costs and departmental charges to the
projected annual costs for PPQ and International Services to arrive at
projected annual AQI program costs.
The projected annual program costs take into account the costs of
providing AQI services only. They do not contain a reserve-building
component. The projected cost for each fiscal year simply reflects the
amount we anticipate it will cost to run the AQI program for that year.
As shown in the following table, we are proposing to phase in new
AQI services over fiscal years 1999 through 2002 in order to supplement
our existing work force at expanding and new ports.
Agricultural Quarantine Inspection (AQI) Program Projected Costs FY 1999-2002
----------------------------------------------------------------------------------------------------------------
FY 1999 FY 2000 FY 2001 FY 2002
Basis for calculating funding need estimate estimate estimate estimate
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Plant Protection and Quarantine (PPQ)
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Base Need (FY 1998 costs + FY 1999 pay costs)... $130,001,000 $130,001,000 $130,001,000 $130,001,000
Personnel Increase:
116 New positions @ 2 months................ 2,779,000 .............. .............. ..............
315 New positions + 116 in FY 99............ .............. 32,149,000 .............. ..............
40 New positions + 116 in FY 99; + 315 in FY .............. .............. 41,003,000 ..............
00.........................................
40 New positions + 116 in FY 99; + 315 in FY .............. .............. .............. 50,027,000
00; + 40 in FY 01..........................
Automation/Maintenance.......................... 1,900,000 4,500,000 4,500,000 1,000,000
Upgrade/Replace X-Ray Equipment:
20 machines................................. 1,540,000 .............. .............. ..............
20 machines................................. .............. 1,540,000 .............. ..............
16 machines................................. .............. .............. 1,232,000 ..............
[[Page 43105]]
New X-Ray Equipment:
5 machines.................................. 3,000,000 .............. .............. ..............
10 machines................................. .............. 6,000,000 .............. ..............
5 machines.................................. .............. .............. 3,000,000 ..............
5 machines.................................. .............. .............. .............. 3,000,000
New and Replacement Vehicles:
50 vehicles................................. 800,000 .............. .............. ..............
50 vehicles................................. .............. 800,000 .............. ..............
50 vehicles................................. .............. .............. 800,000 ..............
32 vehicles................................. .............. .............. .............. 512,000
New and Expanding Facility Costs:
JFK (NY); Laredo IV and Eagle Pass II (TX).. 500,000 .............. .............. ..............
Miami and Sanford (FL); Atlanta (GA), .............. 1,900,000 .............. ..............
Brownsville, El Paso, and Los Tomates (TX);
Santa Teresa (NM)..........................
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PPQ Subtotal.............................. 140,520,000 176,890,000 180,536,000 184,540,000
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International Services (IS)..................... 1,099,072 1,826,112 1,991,918 2,132,275
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Program Subtotal.......................... 141,619,072 178,716,112 182,526,918 186,672,275
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Support Costs:
Agency Overhead & Departmental Charges @ 16,838,508 21,249,346 21,702,451 22,195,333
10.63%.....................................
===============================================================
AQI Program Cost........................ 158,457,580 199,965,458 204,229,369 208,867,608
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Reserve Funds
In order to provide adequate AQI services, we have been forced to
use reserve funds to cover our costs for fiscal years 1997 through
1999. This has reduced our reserve levels at an alarming rate. Since
the current fees do not contain a reserve component, the potential to
run out of reserve funds entirely could become a reality in FY 2001 if
we do not add a reserve component to the fees. The following table
shows our use of reserve funds to recover costs that were higher than
available user fee collections in FY 1998.
FY 1998 Reserve Usage
------------------------------------------------------------------------
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Total user fee collections.............................. $150,804,661
Unavailable collections \1\......................... -13,829,975
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Available fee collections........................... 136,974,686
Cost of AQI program administration.................. -140,094,753
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Funding shortage.................................... -3,120,067
FY 1998 available reserve........................... +17,785,662
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FY 1999 available reserve........................... 14,665,595
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\1\ These collections were unavailable to pay for services provided in
FY 1998 because they were either not collected until after the close
of FY 1998, or are unavailable for expenditure until FY 2003 under
certain provisions of the FACT Act.
Further, for FY 1999, we are projecting the need to cover $10.2 million
in costs from our reserve. As a result, the reserve would contain a
balance of less than $3.9 million at the start of FY 2000 (2 percent of
the cost of running the program for that year), as shown in the
following table.
AQI User Fee Projected Reserve--Cash Basis Accounting Method
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Fiscal Year
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1998 1999 2000 2001 2002
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Fee Collections................. $150,804,661 $159,727,857 $201,066,541 $214,822,796 $217,421,963
Unavailable collections \1\. 13,829,975 12,000,000 5,000,000 .............. ..............
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Available collections..... 136,974,686 147,727,857 196,066,541 214,822,796 217,421,963
AQI Program Cost................ 140,094,753 158,457,580 199,965,458 204,229,369 208,867,608
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Shortage/surplus............ -3,120,067 -10,729,723 -3,898,917 10,593,427 8,554,355
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Projected available reserve 17,785,662 14,665,595 3,935,872 36,955 10,630,382
BEGIN FY...................
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Projected available reserve 14,665,595 3,935,872 36,955 10,630,382 19,184,737
END FY.....................
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Unavailable until FY 2003 \1\...
FY 1997 carry-over.......... 2,000,000 .............. .............. .............. ..............
Annual...................... 13,829,975 12,000,000 5,000,000 .............. ..............
[[Page 43106]]
Cumulative.................. 15,829,975 27,829,975 32,829,975 32,829,975 32,829,975
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\1\ These collections are unavailable to pay for services provided because they were either not collected until
after the close of the fiscal year in which they were earned, or are unavailable for expenditure until FY 2003
under provisions of the FACT Act.
Rebuilding the Reserve
While our spending authority is on a fiscal year basis, the
accounting method used by the Department of Treasury for user fee
collections is based on the date the funds are received and recorded in
the Treasury (cash basis--see the table above), not when they are
earned (accrual basis). The final amount that is available to us from
the AQI account each year is based on the amount collected and recorded
in the account between October 1 and September 30 of each fiscal year.
Since most of the fourth quarter payments are not due and therefore not
received until after the fiscal year is over, we are not able to use
those funds to pay for providing services in the fiscal year when they
are earned.
In the July 1997 final rule, we explained that it is necessary to
maintain a reasonable reserve balance in the AQI account in order to
account for fees earned for providing AQI services in a given fiscal
year that were not received until after that fiscal year ended. The
reserve also provides us with a means to ensure the continuity of AQI
service in cases of bad debt, carrier insolvency, and fluctuations in
activity volumes.
When we set the current user fees, we did not include a reserve-
building component in them because we believed that the reserve levels
would be maintained with fees we collected in excess of the program
costs. Although our user fees are designed to recover the cost of
providing services, in some instances, due to the fact that fees are
rounded up to the nearest quarter or nickel, we may collect additional
funds that are applied to the individual activity reserve balances. The
reserve levels have been maintained in the past through such additional
collections.
However, due to increasing costs, we cannot maintain our reserve
with the current user fees. Therefore, we are proposing to include a
reserve-building component in the user fees to rebuild the reserve
levels for each activity over fiscal years 2000 through 2002. Under
this proposal, the reserve levels for each category of service have
been calculated to reflect approximately 25 percent of each activity's
annual cost. The proposed reserve component would gradually rebuild the
reserve balance to a reasonable level of approximately 25 percent of
the AQI annual program costs to ensure that the reserve is fully funded
by fiscal year 2002.
The table below shows the final annual cost of the AQI program once
costs to rebuild the reserve are added. The final annual costs are the
figures on which we based our proposed fees. The fees are designed to
recover the full cost of the AQI program.
Total AQI Program Costs
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FY 2000 FY 2001 FY 2002
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Cost of AQI program services.................................... 199,965,458 204,229,369 208,867,608
Cost of rebuilding the reserve.................................. 17,125,000 17,550,000 21,480,000
(% of total program cost)................................... (8.56%) (8.59%) (10.28%)
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Total AQI program costs................................... 217,090,458 221,779,369 230,347,608
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Calculation of Fees
Once we established the total annual costs to administer the AQI
program, including an amount to rebuild the AQI account reserve to a
reasonable level, we began the calculation of our proposed fees.
Volumes
First, we estimated the annual volume for each category of service
that would be subject to inspection. The estimates were based on annual
rates of activity for each service category shown in our FY 1992
through FY 1997 collection history.
In our commercial aircraft, commercial vessel, and commercial truck
service categories, we calculated the percentage of change in volume
between FY 1995 and FY 1996, and FY 1996 and FY 1997. Then we
calculated the average percentage of change for those years. We used
this average percentage of change to project volumes for fiscal years
1999 through 2002. We have collection data for FY 1998 available, but
decided not to use it in our calculations because numerous adjustments
to the FY 1998 collection data could be made through the end of FY 2000
(i.e., we will have to account for funds for overpaid vessels and
adjustments to aircraft fees remittances resulting from audit
findings). Therefore, we will review the FY 1998 collection data prior
to publishing a final rule and make necessary adjustments to the
calculations.
For commercial trucks, however, we had to revise our projected
volume for FY 1998 because the actual volume appeared to be much
higher. The average percentage of change from FY 1995 to FY 1996, and
from FY 1996 to FY 1997, was -1.27 for commercial trucks. The actual
volume for FY 1998 shows a 10.22 percent increase over the volume in FY
1997. Nevertheless, we believe the volume increase for FY 1998 is
misleading. During the first quarter of FY 1998, the wrong fee was
originally assessed for individual border crossings ($2.00 instead of
$4.00). In many cases, the corrected fee was eventually collected, but
was recorded in the system as an individual crossing, thus inflating
the actual volumes for FY 1998. Furthermore, a review of commercial
truck volumes for fiscal years 1993 through 1997 shows that the
percentage of change ranged from 2.59 percent to -2.77 percent. Based
on these relatively stable but slightly negative changes in volume, we
are projecting commercial truck volumes for fiscal
[[Page 43107]]
years 1999 through 2002 based on the percentage of change we calculated
for fiscal years 1995 through 1997 (-1.27 percent). These volumes are
shown in the following table:
Volumes/Percentage of Change from Previous Year
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Commercial aircraft Commercial vessel Commercial truck
Fiscal year -----------------------------------------------------------------------------------------------
Volume Change Volume Change Volume Change
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1995.................................................... 361,657 .............. 48,098 .............. 612,743 ..............
1996.................................................... 351,989 -2.67% 47,655 -0.92% 614,214 0.24%
1997.................................................... 380,911 8.22% 48,758 2.31% 597,173 -2.77%
1998.................................................... 391,469 2.77% 51,098 4.80% 658,204 10.22%
Average: FY 1996 & FY 1997 percentage of change......... (-2.67% + 8.22%)/2= 2.77%
(-0.92% + 2.31%)/2= 0.70%
(0.24% + (-2.77%))/2= -1.27%
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Projected Projected Projected
Fiscal year volume Change volume Change volume Change
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1999.................................................... 402,320 2.77% 51,454 0.70% 649,863 -1.27%
2000.................................................... 413,472 2.77% 51,813 0.70% 641,628 -1.27%
2001.................................................... 424,933 2.77% 52,173 0.70% 633,498 -1.27%
2002.................................................... 436,711 2.77% 52,537 0.70% 625,471 -1.27%
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In our commercial truck decal service category, we found that the
volume of users continued to increase, but at a decreasing rate. We
determined that the volume would most likely continue to increase
slightly, but that the increase in the number of decals would most
likely be limited to new or additional growth in trade. The decal
program has been in operation for several years now, and we believe
that the companies interested in buying them are doing so now.
Therefore, we are projecting a modest 5 percent growth increase for
each year, as shown in the following table:
Volumes of Commercial Truck Decals/Percentage of Change from Previous
Year
------------------------------------------------------------------------
Percentage of
Fiscal year Volume change
------------------------------------------------------------------------
1992.................................... 9,256 ..............
1993.................................... 12,403 34.00%
1994.................................... 13,476 8.66%
1995.................................... 14,317 6.24%
1996.................................... 15,758 10.07%
1997.................................... 18,003 14.24%
1998.................................... 19,298 7.20%
1999 (projected)........................ 20,263 5.00%
2000 (projected)........................ 21,276 5.00%
2001 (projected)........................ 22,340 5.00%
2002 (projected)........................ 23,457 5.00%
------------------------------------------------------------------------
In our international air passenger service category, we found that
the volume of users continued to increase each fiscal year 1992 through
1998, but at a decreasing rate. Using the international air passenger
volumes listed below, we estimated percentage of increase in volume for
FY 1999 in the following manner:
1. First, we subtracted the percentage of change in volume from FY
1996 to FY 1997 (4.39%) from the percentage of change in volume from FY
1997 to FY 1998 (3.28%), yielding a rate of decline of -1.11.
2. We then divided this figure by the percentage of change in
volume from FY 1996 to FY 1997 (4.39%) to obtain a rate of decline from
FY 1996 to FY 1997 of -25.28.
3. We then multiplied this rate of decline by the percentage of
change in volume from FY 1997 to FY 1998 (3.28%), yielding a rate of
decline of -0.8293.
4. Finally, we added this result to the percentage of change in
volume from FY 1997 to FY 1998 (3.28%), yielding a projected increase
in volume of 2.45 percent for FY 1999.
This process was repeated to estimate growth for each fiscal year
from 2000 through 2002. These volumes are shown in the table below.
Volumes of International Air Passengers/ Percentage of Change from
Previous Year
------------------------------------------------------------------------
Fiscal year Volume Percent change
------------------------------------------------------------------------
1992.................................... 35,442,923 ..............
1993.................................... 39,630,213 11.81%
1994.................................... 41,784,350 5.44%
1995.................................... 44,710,181 7.00%
1996.................................... 48,296,322 8.02%
1997.................................... 50,414,566 4.39%
[[Page 43108]]
1998.................................... 52,068,452 3.28%
1999 (projected)........................ 53,346,102 2.45%
2000 (projected)........................ 54,325,203 1.84%
2001 (projected)........................ 55,070,989 1.37%
2002 (projected)........................ 55,636,477 1.03%
------------------------------------------------------------------------
The volumes in our loaded railroad car service category increased
from 74,006 in 1994 to 102,265 in 1995 to 147,315 in 1996 as a result
of the North American Free Trade Agreement. The volume decreased in
1997, but for 1998, there was a slight increase in volume over 1996.
However, one of the five railroad companies transiting goods across the
U.S.-Mexican border has ceased operations indefinitely. In addition,
due to recent business consolidations, the number of railroad companies
crossing the border has decreased from five to three. Since our fee is
assessed to loaded railroad cars only, we do not anticipate much
increase in individual loaded railroad cars, but better utilization of
the cars by railroad companies. We believe that future increases above
the FY 1998 level will be minimal, and are projecting a zero percent
increase each fiscal year through 2002. We will watch the railroad car
volumes carefully, and if our volume assumption is incorrect, we will
take steps immediately to adjust the fees accordingly. The volumes are
shown in the following table.
Volumes of Loaded Railroad Car/Percentage of Change from Previous Year
------------------------------------------------------------------------
Fiscal year Volume Percent change
------------------------------------------------------------------------
1992.................................... 56,688 ..............
1993.................................... 64,023 12.94%
1994.................................... 74,006 15.59%
1995.................................... 102,265 38.18%
1996.................................... 147,315 44.05%
1997.................................... 141,717 -3.80%
1998.................................... 148,300 4.65%
1999 (projected)........................ 148,300 0.00%
2000 (projected)........................ 148,300 0.00%
2001 (projected)........................ 148,300 0.00%
2002 (projected)........................ 148,300 0.00%
------------------------------------------------------------------------
Distribution of Costs
Next, we projected the direct costs of providing AQI services in
fiscal years 1999 through 2002 for each category of service: Commercial
vessels, commercial trucks, commercial railroad cars, commercial
aircraft, and international airline passengers. The cost of providing
these services in prior fiscal years served as a basis for calculating
our projected costs.
In FY 1992, APHIS established accounting procedures to segregate
AQI user fee program costs. We published a detailed description of
these procedures in the Federal Register on December 31, 1992 (57 FR
62468-62473, Docket No. 92-148-1), as part of a document amending some
of our user fees.
As part of our accounting procedures, we established distinct
accounting codes to record costs that can be directly related to each
inspection activity. At the State level and below, the following costs
are direct-charged to the AQI User Fee Account: Salaries and benefits
for inspectors and canine officers, supervisors (such as port
directors) and clerical staff; equipment used only in connection with
services subject to user fees; contracts; and large supply items such
as x-ray equipment or uniforms.
Other costs that cannot be directly charged to individual accounts
are charged to ``distributable'' accounts established at the State
level. The following types of costs are charged to distributable
accounts: Utilities, rent, telephone, vehicles, office supplies, etc.
The costs in these distributable accounts are prorated (or distributed)
among all the activities that benefit from the expense, based on the
ratio of the costs that are directly charged to each activity divided
by the total costs directly charged to each account at the field level.
For example, if a State office performs work on domestic programs, AQI
user fee programs, and AQI appropriated programs, the costs are
distributed among the programs, based on the percentage of the direct
costs for that activity at the field level that are charged to that
activity. Costs incurred at the regional-, headquarters program staff-,
and agency-level support offices are also prorated to the separate AQI
activities based on the percentage of the costs that were directly
charged to each activity at the field level, as discussed above.
Using these accounting procedures, we calculated the total cost of
providing AQI services in each past fiscal year by determining the
amounts in each direct-charge account, then adding the pro rata share
of the distributable accounts maintained at the State, regional,
headquarters, and agency levels.
We then projected total costs to provide each category of service
during each future fiscal year. Each projection included the costs of
program delivery, which are incurred at the State level and below. Also
included was a pro rata share of the program direction and support
costs, as explained above, which include items at the regional and
headquarters program staff levels. Finally, each projection included a
pro rata share of agency-level support costs, as discussed above, which
includes activities that support the entire agency, such as recruitment
and development, legislative and public affairs, regulations
development, regulatory enforcement, budget and accounting services,
and payroll and purchasing services. Costs for billing and collection
services, legal
[[Page 43109]]
counsel, and rate development services that are directly related to
user fee activities are directly added to the user fee activities they
support and are not included in the proration of agency-level costs.
User Fee Calculation
The following tables show our user fee calculations. To calculate
the user fees, we divided the sum of the costs for each service by the
projected volume subject to inspection for that service, thereby
arriving at ``raw'' fees. We then rounded the raw fees.
As in the past, we rounded raw fees up, rather than down, to ensure
that we collect enough revenue to cover the costs of providing services
and enough revenue to maintain a reasonable reserve. Any excess
collections due to rounding would be added to the reserve balance for
each individual fee category. If an increase in volume results in
additional revenue from user fees, this revenue would not necessarily
increase the reserve because the additional money would be used to
service the increased volume.
We rounded all user fees up to the nearest quarter, except for the
international airline passenger user fee. Given the large volume of
passengers, if we rounded up to the nearest quarter we would recover
far more than is necessary. Therefore, we rounded the passenger user
fee up to the nearest nickel.
AQI User Fee Calculations, FY 2000
----------------------------------------------------------------------------------------------------------------
Estimated Projected Projected
AQI activity total costs volume Raw fee Rounded fee revenue
----------------------------------------\1\---------------------------------------------------------------------
Commercial vessel............... 24,115,749 51,813 465.44 465.50 24,118,952
Commercial truck \2\............ 4,442,247 1,067,156 4.16 4.25 4,535,413
Loaded railroad cars............ 977,907 148,300 6.59 6.75 1,001,025
Commercial aircraft............. 26,397,363 413,472 63.84 64.00 26,462,208
Airline passengers.............. 161,157,192 54,325,203 2.97 3.00 162,975,609
-------------------------------------------------------------------------------
Total..................... 217,090,458 .............. .............. .............. 219,093,206
----------------------------------------------------------------------------------------------------------------
\1\ Total program costs include the cost of rebuilding the AQI account available reserve.
\2\ Decals could be purchased at 20 times the individual crossing rate, or $85.00 per decal, and would be valid
from January 1 through December 31, 2000.
AQI User Fee Calculations, FY 2001
----------------------------------------------------------------------------------------------------------------
Estimated Projected Projected
AQI activity total costs volume Raw fee Rounded fee revenue
----------------------------------------\1\---------------------------------------------------------------------
Commercial vessel............... 24,755,100 52,173 474.48 474.50 24,756,089
Commercial truck \2\............ 4,832,670 1,080,302 4.47 4.50 4,861,359
Loaded railroad cars............ 1,018,647 148,300 6.87 7.00 1,038,100
Commercial aircraft............. 27,476,799 424,933 64.66 64.75 27,514,412
Airline passengers.............. 163,696,152 55,070,989 2.97 3.00 165,212,967
-------------------------------------------------------------------------------
Total..................... 221,779,368 .............. .............. .............. 223,382,926
----------------------------------------------------------------------------------------------------------------
\1\ Total program costs include the cost of rebuilding the AQI account available reserve.
\2\ Decals could be purchased at 20 times the individual crossing rate, or $90.00 per decal, and would be valid
from January 1 through December 31, 2001.
AQI User Fee Calculations, FY 2002
----------------------------------------------------------------------------------------------------------------
Estimated Projected Projected
AQI activity total costs volume Raw fee Rounded fee revenue
----------------------------------------\1\---------------------------------------------------------------------
Commercial vessel............... 25,242,791 52,537 480.48 480.50 25,244,029
Commercial truck \2\............ 5,046,927 1,094,614 4.61 4.75 5,199,417
Loaded railroad cars............ 1,024,546 148,300 6.91 7.00 1,038,100
Commercial aircraft............. 28,402,958 436,711 6.504 6.525 28,495,393
Airline passengers.............. 170,630,386 55,636,477 3.07 3.10 172,473,079
-------------------------------------------------------------------------------
Total..................... 230,347,608 .............. .............. .............. 232,450,016
----------------------------------------------------------------------------------------------------------------
\1\ Total program costs include the cost of rebuilding the AQI account available reserve.
\2\ Decals could be purchased at 20 times the individual crossing rate, or $95.00 per decal, and would be valid
from January 1 through December 31, 2002.
Current and Proposed User Fees
Our current user fees for AQI services for fiscal years 1999
through 2002 and the user fees we are proposing to charge for these
services for FY 2000 through FY 2002 are shown in the table below.
Also, below, we describe each AQI service, and explain additional
activities and costs as they pertain to each service individually.
[[Page 43110]]
Agricultural Quarantine Inspection (AQI) User Fees
--------------------------------------------------------------------------------------------------------------------------------------------------------
Currently Currently Currently
Service Current FY scheduled Proposed scheduled Proposed scheduled Proposed
1999 FY 2000 FY 2000 FY 2001 FY 2001 FY 2002 FY 2002
--------------------------------------------------------------------------------------------------------------------------------------------------------
Commercial Vessel............................................ 454.50 461.75 465.50 471.25 474.50 480.25 480.50
Commercial Truck............................................. 4.00 4.00 4.25 4.00 4.50 4.25 4.75
Commercial Truck Decal....................................... 80.00 80.00 \1\ 85.00 80.00 \1\ 90.00 85.00 \1\ 95.00
Loaded Railroad Car.......................................... 6.50 6.75 6.75 6.75 7.00 7.00 7.00
Commercial Aircraft.......................................... 59.75 60.25 64.00 61.25 64.75 62.25 65.25
Airline Passenger............................................ 2.00 2.05 3.00 2.10 3.00 2.15 3.10
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Commercial truck decals are issued on a calendar year basis. Decal rates would be effective January 1 of each year.
Commercial Vessels
We inspect commercial vessels of 100 net tons or more arriving at
ports of entry into the customs territory of the United States. Vessels
pay a user fee for the first 15 arrivals at ports. The U.S. Customs
Service (Customs) collects this user fee for APHIS.
The proposed fees for fiscal years 2000, 2001, and 2002 are
approximately 0.8, 0.7, and 0.05 percent higher than the respective
currently scheduled fees. The proposed fees would allow us to recover
increased costs attributed to:
Anticipated new hires in fiscal years 1999 and 2000 of at
least 51 inspection personnel at seaports throughout the United States,
including Miami, FL; Elizabeth, NJ; San Juan, PR; and Charleston, SC.
New and replacement vehicles, equipment, and additional x-
ray equipment.
The addition of a reserve component to the fees to
gradually rebuild the vessel reserve to a reasonable level of
approximately 25 percent of annual operating costs by the end of FY
2002.
For fiscal years 2001 and 2002, the proposed fees are less than one
half of one percent higher than the currently scheduled fees. This is
attributed to conducting the increased volume of vessel inspections
with the same number of personnel and new and improved technology.
Commercial Trucks
We inspect commercial trucks arriving at land ports in the customs
territory of the United States from Mexico.\1\ Customs also collects
our truck user fees.
---------------------------------------------------------------------------
\1\ 7 CFR 354.3(c)(2)(i) of the regulations exempts commercial
trucks entering the customs territory of the United States from
Canada from paying this APHIS user fee.
---------------------------------------------------------------------------
The proposed fees for fiscal years 2000, 2001, and 2002 are
approximately 6.25, 12.5, and 11.8 percent higher than the respective
currently scheduled fees. The proposed fees would allow us to recover
increased costs attributed to:
Anticipated new hires in fiscal years 1999 through 2002 of
approximately 39 additional inspection personnel at various land border
ports, including Brownsville and El Paso, TX, and Santa Teresa, NM.
New and replacement vehicles, equipment, and additional x-
ray equipment.
The addition of a reserve component to the fees to
gradually rebuild the depleted truck reserve to a reasonable level of
approximately 25 percent of the annual operating costs by the end of FY
2002.
The regulations currently require that commercial trucks pay the
APHIS user fee each time they enter the customs territory of the United
States from Mexico at the same time they pay the Customs user fee. Our
regulations also allow commercial trucks to prepay the APHIS user fee;
however, this only applies if they are prepaying the Customs user fee.
In that case, the required APHIS user fee is 20 times the user fee for
each arrival, and is valid for an unlimited number of entries during
the calendar year (see 7 CFR 354.3(c)(3)(i) of the regulations). The
truck owner or operator, upon payment of the APHIS and the Customs user
fees, receives a decal to place on the truck windshield. This is a
joint decal, indicating that both the Customs and APHIS user fees for
the truck have been paid for that calendar year.
Commercial Railroad Cars
We inspect loaded commercial railroad cars arriving at land ports
in the customs territory of the United States from Mexico.\2\ The fees
for this service are calculated and remitted by the individual railroad
companies within 60 days after the end of each calendar month.
---------------------------------------------------------------------------
\2\ Section 354.3(c)(2)(i) of the regulations exempts loaded
commercial railroad cars entering the customs territory of the
United States from Canada from paying the APHIS user fee.
---------------------------------------------------------------------------
The proposed fee for fiscal year 2001 is approximately 3.7 percent
higher than the currently scheduled fee. The fees for fiscal years 2000
and 2002 will not change. The proposed fees would allow us to recover
increased costs attributed to:
Anticipated new hires in fiscal years 2000 through 2002 of
approximately 18 additional inspection personnel at various land border
ports, including Los Tomates and Brownsville, TX, and Nogales, AZ.
New and replacement vehicles and equipment.
The addition of a reserve component to the fees to
gradually rebuild the railroad car reserve to a reasonable level of
approximately 25 percent of the annual operating costs by the end of FY
2002.
Commercial Aircraft
We also inspect international commercial aircraft arriving at
airports in the customs territory of the United States. The fees for
this service are calculated and remitted by the individual airline
companies within 31 days after the end of each calendar quarter.
The proposed fees for fiscal years 2000, 2001, and 2002 are
approximately 6.2, 5.7, and 4.8 percent higher than the respective
currently scheduled fees. The proposed fees would allow us to recover
increased costs attributed to:
Anticipated new hires in fiscal years 1999 through 2002 of
approximately 137 additional inspection personnel at various existing
and expanding or new airport facilities, including Miami, Orlando, and
Ft. Lauderdale, FL; Atlanta and Savannah, GA; Chicago, IL; JFK
International Airport, NY; Dallas, San Antonio, and Houston, TX; Los
Angeles and San Francisco, CA; Honolulu, HI; and San Juan, PR.
New and replacement vehicles, equipment, and additional x-
ray equipment.
The addition of a reserve component to the fees to
gradually rebuild the commercial aircraft reserve to a reasonable level
of approximately 25 percent of the annual operating costs by the end of
FY 2002.
[[Page 43111]]
In addition, we are working closely with Customs on the development
and installation at major airports of a joint automated cargo tracking
system, which would greatly improve the paper tracking cargo system
currently used at most airports.
International Airline Passengers
We also inspect international airline passengers arriving at
airports in the customs territory of the United States.
Millions of travelers pass through U.S. airports daily. APHIS'
overall goal is a timely, seamless inspection process, integrated with
clearance processes of other agencies in the Federal Inspection Service
(FIS) that will ensure the fastest passenger clearance time while
safeguarding against the introduction of harmful pests and diseases of
animals and plants. Our joint goal is to improve enforcement and
regulatory processes in order to clear most international air
passengers through the FIS inspection process in 30 minutes or less. In
partnership with the airline industry, advanced information will be
obtained on 80 percent of international air passengers through the use
of the Advance Passenger Information System to expedite the overall
processing of passengers with no loss in enforcement.
To accomplish these goals and to ensure adequate coverage, we
anticipate additional costs that would result from:
Hiring approximately 216 additional inspection personnel
in fiscal years 1999 through 2002 at various new and expanding airport
facilities, including Miami, Sanford, and Tampa, FL; New Orleans, LA;
Atlanta and Savannah, GA; Chicago, IL; JFK International Airport and
Brooklyn, NY; Dallas, Houston, San Antonio, El Paso, Galveston, and
Brownsville, TX; Los Angeles, Fresno, Sacramento, and San Francisco,
CA; Honolulu and Maui, HI; San Juan, PR; Bermuda, and the Bahamas.
Purchasing new and replacement vehicles, equipment, and
additional x-ray equipment.
Purchasing and installing new high definition x-ray
machines with luggage tracking and marking capability at most of the
larger airports throughout the country.
Adding about 50 new canine teams (one officer and one dog
per team) at airports throughout the country, including JFK
International Airport, NY; Newark, NJ; Chicago, IL; Honolulu, HI; Miami
and Ft. Lauderdale, FL; Atlanta, GA; Houston, Dallas, Pharr, Laredo,
and El Paso, TX; Los Angeles, Oakland, and San Francisco, CA.
The addition of a reserve component to the fees to
gradually rebuild the international airline passenger reserve to a
reasonable level of approximately 25 percent of the annual operating
costs by the end of FY 2002.
Executive Order 12866 and Regulatory Flexibility Act
This proposed rule has been reviewed under Executive Order 12866.
The rule has been determined to be significant for the purposes of
Executive Order 12866 and, therefore, has been reviewed by the Office
of Management and Budget. The economic analysis prepared for this
proposed rule provides a cost-benefit analysis as required by Executive
Order 12866 and an analysis of economic effects on small entities as
required by the Regulatory Flexibility Act. The analysis is summarized
below. Copies of the full analysis are available by contacting Ms.
Donna Ford at the address listed under FOR FURTHER INFORMATION CONTACT.
Introduction
APHIS is proposing to revise existing agricultural quarantine and
inspection (AQI) user fees to recover additional and unanticipated
program costs and to rebuild the AQI reserve. The proposed AQI user fee
revisions would become effective in the first quarter of FY 2000 and
would be in effect through FY 2002.
International air passengers, commercial aircraft, commercial
vessels, commercial trucks, and commercial railroad cars arriving at
ports in the customs territory of the United States would be affected
by the increase in AQI user fees.
The FACT Act, as amended, provides that APHIS may prescribe and
collect fees to cover the cost of providing quarantine and inspection
services in connection with the arrival of international airline
passengers, commercial aircraft, commercial vessels, commercial trucks,
and commercial railroad cars at ports in the customs territory of the
United States. The FACT Act further states that the fees should be
sufficient to cover the cost of administering the program and
sufficient to maintain a reasonable balance (or reserve) in the AQI
User Fee Account.
Need for Regulation
The purpose of AQI inspections at United States ports of entry is
to prevent international travelers and conveyances from introducing
harmful plant and animal pests that could damage U.S. agriculture and
cause substantial economic losses to domestic producers, consumers,
exporters, and to a range of allied agricultural industries. In the
case of AQI user fees, those international travelers or conveyances who
may carry agricultural pests or diseases from abroad are required to
pay for AQI program activities.
Generating revenues to operate public programs by charging users is
widely practiced by Federal, State and local government agencies, and
is based on the premise that the beneficiaries or users of a public
system, and not the public at large, should pay for its operation. User
fees can be an equitable way of matching program costs to program users
or beneficiaries.
Composition of Proposed Fees
Computation of AQI user fees is based on direct program delivery
costs, program support costs, Agency-level support costs, anticipated
user fee administrative costs, and reserve fund costs.
Direct Program Costs
Direct program costs include, but are not limited to: Salary and
benefits for inspectors, canine officers, supervisory and clerical
staff, uniform allowances, local travel expenses, and specialized
equipment purchases.
Program Support Costs
Program support costs include all expenditures necessary to
maintain regional and headquarters support staffs and offices,
including APHIS program staff, detection methods development, plant
risk assessments, and automatic data processing (ADP) support.
Agency-level Costs
In addition to salary and benefit costs, Agency-level support costs
include, but are not limited to: Recruitment and development,
legislative and public affairs, regulatory enforcement, communications,
postage, budget and accounting services, and the cost for USDA's
National Finance Center to provide payroll, purchasing, and other
related financial services.
Administrative Costs
The FACT Act, as amended, allows the Agency to recover
administrative costs that the Agency incurs as a direct result of
developing, collecting, and monitoring AQI user fees.
The Reserve Fund
The FACT Act allows for a reasonable balance in the AQI User Fee
Account. The reserve serves several purposes. The reserve insures that
the Agency has access, through the AQI User Fee Account, to funds for
normal operating expenses. Second, the reserve fund will insure that
the Agency has sufficient
[[Page 43112]]
operating funds in cases of bad debt, carrier insolvency, or
fluctuations in activity volumes. Further, in the July 1997 final rule,
we explained that it is also necessary to maintain a reasonable reserve
balance in the AQI account in order to account for fees earned for
providing AQI services in a given fiscal year that were not received
until after that fiscal year ended.
Regulatory Flexibility Analysis
The effects of increased fees on small entities in each of the
affected industries are discussed separately below. The proposed fee
changes will also affect international airline passengers arriving at
ports in the customs territory of the United States; however,
passengers are not included in this analysis because the Regulatory
Flexibility Act does not cover individuals.
Commercial Vessels
We are proposing to amend the scheduled user fees for inspecting
commercial vessels by increasing the fees by $3.75 in FY 2000, by $3.25
in FY 2001, and by $0.25 in FY 2002. APHIS inspects vessels of 100 net
tons or more arriving from all foreign ports, except Canada. Typically,
APHIS inspects (and charges) dry cargo vessels operating between the
United States and foreign ports. At the beginning of 1996 there were
192 U.S. dry cargo vessels.
Bureau of the Census data compiled by the Small Business
Administration (SBA) in 1995 show that the affected industry, U.S.
commercial vessels engaged in deep sea foreign transportation of
freight, was composed mostly of small firms (less than 500 employees,
according to the SBA definition). In 1995, there were 125 firms
engaging in deep sea transportation of freight and 111 of them, or 89
percent of the affected industry, employed less than 500 employees.
Also in 1995, the average or typical small U.S. firm engaged in deep
sea transportation of freight had roughly 31 employees, a payroll of
less than $1.6 million, and annual receipts of $28 million. Data on
number of dry cargo vessels per firm or firms exclusively operating dry
cargo vessels are not available.
Anecdotal information suggests that many of the companies that are
subject to AQI inspections are not U.S. firms. Further, it is unclear
how many of the 125 U.S. firms would actually be affected by the
increase in AQI user fees, and how many of the affected firms would be
small entities. We do know that total daily operating costs for dry
cargo vessels idle in port average between $23,600 and $26,800. The
proposed user fee increases of $3.75 in FY 2000, $3.25 in FY 2001, and
$0.25 in FY 2002 are very insignificant fractions of daily operating
costs, suggesting that the proposed fee revision will not have a
significant economic impact on small firms operating vessels.
Commercial Trucks
APHIS inspects trucks entering the United States from Mexico. It is
unclear how many of these trucks entering the United States from Mexico
are owned and operated by U.S. firms. According to a recent General
Accounting Office report, roughly 11,000 trucks cross the border each
week day (a total of 3,113,091 in FY 1996) from Mexico into the United
States. The bulk (93 percent) of northbound truck traffic comes through
seven major customs ports: Otay Mesa, California; Calexico, California;
Nogales, Arizona; El Paso, Texas; Laredo, Texas; McAllen, Texas; and
Brownsville, Texas. Many of these trucks are owned and operated by
Mexican firms. At present, trucks from Mexico are limited to commercial
zones along the border and many make multiple daily crossings. Mexican
brokers tend to control much of the truck traffic at some border
locations. Reliable data on future traffic patterns are not available.
It is unclear how many U.S. trucking firms would be affected by the
proposed increase in AQI user fees. Anecdotal evidence from APHIS
employees indicates that many of the AQI truck decals, which are good
for multiple inspections, are being purchased by U.S. trucking firms
operating in Texas, California, and Arizona. 1995 Bureau of the Census
data show that the overwhelming majority of trucking firms in these
States would be considered small firms by SBA standards (less than
$18.5 million in receipts annually). SBA data also show that the
typical small trucking firm in one of these border States had 10
employees and earned a little less than $1 million in receipts
annually.
If we assume that any small U.S. trucking firm that regularly
transports freight from Mexico would purchase an APHIS truck decal,
which is good for an unlimited number of entries during the calendar
year, the proposed increase in user fees could cost a small firm, at
most, an additional $5 per truck or an estimated $55 per firm in FY
2000; and $10 per truck or an estimated $110 per firm in FY 2001 and FY
2002. This estimate is based on the assumption that a small firm owns a
maximum of 11 trucks. There are no official statistics on the fleet
size of small trucking firms either for selected border States, or for
the United States as a whole. This assumption is based on private
sector trucking industry data on 256,223 U.S. trucking firms
representing a combined fleet of over 2.3 million vehicles. This data
shows that 91 percent of firms own 11 or fewer trucks.
SBA data show that the typical small trucking firm in Arizona,
California, or Texas has annual receipts of $932,000. We therefore
believe that the proposed increase in cost, as explained above ($110
for the average small firm), would not result in a significant new
burden on small commercial trucking firms.
Loaded Commercial Railroad Cars
There are four U.S. railroad companies currently transporting goods
across the U.S.-Mexican border. Two of these railroad companies meet
the SBA criteria for small entities (fewer than 1,500 employees). As of
1991, the smaller railroad companies transported between 960 and 2,000
loaded rail cars into the United States from Mexico annually. Data on
operating expenses and profit margins for these companies are not
available; but proposed user fees would not increase in FY 2000 and FY
2002, and would only increase by $0.25 in FY 2001, suggesting that
there would not be a significant economic impact on these two small
U.S. railroad companies.
Commercial Airlines
We are proposing to amend the scheduled user fees for inspecting
commercial aircraft by increasing the fees by $3.75 in FY 2000, $3.50
in FY 2001, and $3.00 in FY 2002. International scheduled and
unscheduled (chartered) air passenger, air cargo, and air courier
carriers arriving at U.S. customs ports are subject to AQI inspections.
Bureau of the Census data compiled by the SBA show that there were a
total of 6107 firms in the U.S. air transportation industry in 1995,
and that more than 5893 (or more than 96.5 percent) would have met the
SBA criteria for small entity (employing fewer than 1500 employees).
The typical small firm in the air transportation industry had 15
employees, an annual payroll of $398 thousand, and estimated annual
receipts of $2.1 million.
APHIS regulations affect international flights, many of which are
operated by foreign-owned firms. Those U.S. air transport firms that do
not operate international flights are not subject to the proposed rule.
Agency records show that, in 1995, only 123 of the 6107 firms in the
air transportation industry were subject to AQI inspections because
they
[[Page 43113]]
operated international flights. This data suggests that the increased
user fees will not affect a substantial number of small air
transportation companies. Even if all 123 U.S. airline firms were small
entities (which they are not), the proposed fee revision would be
applicable to only 2 percent of small firms in the industry. Using
information on the number of firms inspected, the number of projected
inspections, and the assumption that firms subject to inspection are
distributed by size in a fashion consistent with the industry as a
whole, we can develop very rough estimates of impact on small firms.
Each of the 123 U.S. companies would have had an airplane inspected
between 1600 and 1700 times per year if inspections were prorated
equally between large and small firms. In practice, small firms with
fewer aircraft would probably have substantially fewer annual
inspections, so we are overestimating the impact of fee revisions on
small firms. Given the assumptions above, the increased fees listed
above would translate into additional costs per firm of between $5,000
and $6,000 per year, which are less than three tenths of one percent of
estimated annual receipts for the average small air transportation
firm.
Given the data, assumptions, and calculations above, it is
reasonable to conclude that proposed fee revisions will not have
significant economic impact on a substantial number of small air
transportation firms.
Other Costs and Benefits
Additional reporting costs to private airlines associated with
revising user fees are likely to be very small because mechanisms are
already in place for collecting fees. There should be no additional
recordkeeping costs for ticketing agents and tour operators, who are
not involved in remitting fees and are not expected to remit fees in
future. Further there will be no additional reporting burdens on
vessel, aircraft, rail car, and truck operators as a result of the
proposed changes in user fees.
The benefit of user fees is the shift in the payment of services
from taxpayers as a whole to those persons who are receiving the
government services. While taxes may not change by the same amount as
the change in user fee collections, there is a related shift in
appropriations, which allows tax dollars to be applied to other
programs that benefit the public in general.
The administrative cost involved in obtaining these savings would
be minimal. APHIS already has a user fee program and a mechanism for
collecting user fees in place, and since this proposal would simply
update existing user fees, increases in administrative costs would be
small. Because the savings are sufficiently large, and the
administrative costs would be small, it is likely that the net gain in
reducing the burden on taxpayers as a whole would outweigh the cost of
administering the revisions of the user fees.
Under these circumstances, the Administrator of the Animal and
Plant Health Inspection Service has determined that this action would
not have a significant economic impact on a substantial number of small
entities.
Executive Order 12372
This program/activity is listed in the Catalog of Federal Domestic
Assistance under No. 10.025 and is subject to Executive Order 12372,
which requires intergovernmental consultation with State and local
officials. (See 7 CFR part 3015, subpart V.)
Executive Order 12988
This proposed rule has been reviewed under Executive Order 12988,
Civil Justice Reform. If this proposed rule is adopted: (1) All State
and local laws and regulations that are inconsistent with this rule
will be preempted; (2) no retroactive effect will be given to this
rule; and (3) administrative proceedings will not be required before
parties may file suit in court challenging this rule.
Paperwork Reduction Act
This proposed rule contains no new information collection or
recordkeeping requirements under the Paperwork Reduction Act of 1995
(44 U.S.C. 3501 et seq.).
List of Subjects in 7 CFR Part 354
Exports, Government employees, Imports, Plant diseases and pests,
Quarantine, Reporting and recordkeeping requirements, Travel and
transportation expenses.
Accordingly, we propose to amend 7 CFR part 354 as follows:
PART 354--OVERTIME SERVICES RELATING TO IMPORTS AND EXPORTS; AND
USER FEES
1. The authority citation for part 354 would continue to read as
follows:
Authority: 7 U.S.C. 2260; 21 U.S.C. 136 and 136a; 49 U.S.C.
1741; 7 CFR 2.22, 2.80, and 371.2(c).
2. Section 354.3 would be amended by revising the tables in
paragraphs (b)(1), (c)(1), (d)(1), (e)(1), and (f)(1) to read as
follows:
Sec. 354.3 User fees for certain international services.
* * * * *
(b) * * *
(1) * * *
------------------------------------------------------------------------
Effective dates Amount
------------------------------------------------------------------------
October 1, 1998 through September 30, 1999................. 454.50
October 1, 1999 through September 30, 2000................. 465.50
October 1, 2000 through September 30, 2001................. 474.50
October 1, 2001 through September 30, 2002................. 480.50
------------------------------------------------------------------------
* * * * *
(c) * * *
(1) * * *
------------------------------------------------------------------------
Effective dates Amount
------------------------------------------------------------------------
October 1, 1998 through September 30, 1999................. 4.00
October 1, 1999 through September 30, 2000................. 4.25
October 1, 2000 through September 30, 2001................. 4.50
October 1, 2001 through September 30, 2002................. 4.75
------------------------------------------------------------------------
* * * * *
(d) * * *
(1) * * *
------------------------------------------------------------------------
Effective dates Amount
------------------------------------------------------------------------
October 1, 1998 through September 30, 1999................. 6.50
October 1, 1999 through September 30, 2000................. 6.75
October 1, 2000 through September 30, 2001................. 7.00
October 1, 2001 through September 30, 2002................. 7.00
------------------------------------------------------------------------
* * * * *
(e) * * *
(1) * * *
------------------------------------------------------------------------
Effective dates Amount
------------------------------------------------------------------------
October 1, 1998 through September 30, 1999................. 59.75
October 1, 1999 through September 30, 2000................. 64.00
October 1, 2000 through September 30, 2001................. 64.75
October 1, 2001 through September 30, 2002................. 65.25
------------------------------------------------------------------------
* * * * *
(f) * * *
(1) * * *
------------------------------------------------------------------------
Effective dates Amount
------------------------------------------------------------------------
October 1, 1998 through September 30, 1999................. 2.00
October 1, 1999 through September 30, 2000................. 3.00
October 1, 2000 through September 30, 2001................. 3.00
October 1, 2001 through September 30, 2002................. 3.10
------------------------------------------------------------------------
[[Page 43114]]
* * * * *
3. In Sec. 354.3, paragraph (c)(3)(i) would be amended by removing
the words ``, except, that through September 30, 1997, the amount to be
paid is $40.00''.
Done in Washington, DC, this 30th day of July 1999.
Bobby R. Acord,
Acting Administrator, Animal and Plant Health Inspection Service.
[FR Doc. 99-20113 Filed 8-6-99; 8:45 am]
BILLING CODE 3410-34-P