[Federal Register Volume 64, Number 29 (Friday, February 12, 1999)]
[Rules and Regulations]
[Pages 7057-7059]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-3338]
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Rules and Regulations
Federal Register
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Federal Register / Vol. 64, No. 29 / Friday, February 12, 1999 /
Rules and Regulations
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DEPARTMENT OF AGRICULTURE
Grain Inspection, Packers and Stockyards Administration
7 CFR Part 868
RIN 0580-AA67
Fees for Rice Inspection
AGENCY: Grain Inspection, Packers and Stockyards Administration, USDA.
ACTION: Final rule.
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SUMMARY: The Grain Inspection, Packers and Stockyards Administration
(GIPSA) is increasing certain fees for Federal rice inspection services
performed under the Agricultural Marketing Act (AMA) of 1946. This fee
increase is intended to cover, as nearly as practicable, the projected
approximate 3.6 percent increase to Federal salaries for Federal Rice
Inspection Services. The increase is designed to generate additional
revenue required to recover operational costs created by cost-of-living
increases to Federal salaries January 1, 1999.
EFFECTIVE DATE: March 1, 1999.
FOR FURTHER INFORMATION CONTACT: Sharon Vassiliades, USDA, GIPSA, ART,
1400 Independence Avenue, SW, Stop 3649, Washington, D.C. 20250-3649;
telephone (202) 720-1738; electronic mail or Internet
svassili@fgisdc.usda.gov.
SUPPLEMENTARY INFORMATION:
Executive Order 12866
This rule has been determined to be nonsignificant for the purpose
of Executive Order 12866 and, therefore, has not been reviewed by the
Office of Management and Budget.
Executive Order 12988
This rule has been reviewed under Executive Order 12988, Civil
Justice Reform. This action is not intended to have a retroactive
effect. This action will not preempt any State or local laws,
regulations, or policies unless they present irreconcilable conflict
with this rule. There are no administrative procedures which must be
exhausted prior to any judicial challenge to provisions of this rule.
Regulatory Flexibility Act and Effects on Small Entities
James R. Baker, Administrator, GIPSA, has determined that this rule
will not have a significant economic impact on a substantial number of
small entities as defined under the Regulatory Flexibility Act (5
U.S.C. 601 et seq.).
The cost of living increase in the rice service fee is primarily
applicable to GIPSA customers that produce, process, and market rice
for the domestic and international markets. There are approximately 550
such customers located primarily in the Arkansas, Louisiana, and Texas
geographic areas. Many of these customers meet the criteria for small
business. GIPSA has determined that this rule will have a limited
economic impact on small entities as defined in the Regulatory
Flexibility Act.
Under the provisions of the Agricultural Marketing Act of 1946 (7
U.S.C. 1621 et seq.), rice inspection services are provided upon
customer request and GIPSA must recover from the customer the cost of
providing such services. GIPSA will recover the January 1, 1999,
average 3.6 percent increase in Federal salary costs by raising its
rice service fee. The increase will affect only that portion of the
fees associated with the hourly salaries paid to Federal employees and
administrative personnel; overhead costs are not included in this
increase.
GIPSA cannot absorb the approximate 3.6 percent increase in salary
costs with the existing deficit in retained earnings. In fiscal year
1998, GIPSA's obligations were $3,820,820 with revenue of $4,011,446,
resulting in a positive margin of $190,626 and retained earnings of
negative $895,584.
The increase in fees will not have a significant impact on either
small or large entities. GIPSA estimates that the increased fee charged
to its 550 customers will provide an annual increase of $155,356 in
revenue (assuming fiscal year 1998 volume equivalents).
Information Collection and Record Keeping Requirements
In compliance with the Paperwork Reduction Act of 1995 (44 U.S.C.
Chapter 35), the information collection and record keeping requirements
concerning applications for official inspection services including rice
inspections have been previously approved by the Office of Management
and Budget under control number 0580-0013.
Background
On November 25, 1998, GIPSA published in the Federal Register (63
FR 65134) a proposal to increase certain fees for Federal rice
inspection services performed under the Agricultural Marketing Act of
1946.
The rice inspection fees were last amended on July 3, 1996 (61 FR
34714), with a tri-level fee increase with effective dates of August 2,
1996, January 1, 1997, and January 1, 1998. These fees were to cover,
as nearly as practicable, the projected operating costs, including
related supervisory and administrative costs and to maintain an
operating reserve for Federal rice inspection services. They presently
appear at 7 CFR 868.91 in Tables 1 and 2. Currently, the regular
workday contract and noncontract fees are $40.20 and $48.90,
respectively, while the nonregular workday contract and noncontract
fees are $56.00 and $67.90, respectively. The unit rate per
hundredweight for export port services is currently $ .048/cwt. and the
unit rate for total oil and free fatty acid tests is currently $39.80.
These unit rates are also being changed.
The increase affects only that portion of the fees associated with
hourly salaries paid to Federal employees and administrative personnel;
overhead recovery is not included. The fee increase generates
additional revenue required to recover operational costs created by the
January 1999 cost-of-living increase to Federal salaries. The average
salary increase for GIPSA employees in calendar year 1999 is projected
at approximately 3.6 percent. This action is being taken to ensure that
the service fees charged by GIPSA generate adequate revenue to cover
the additional cost created by the January 1999 Federal salary
increase.
The hourly fees covered by this rule generate revenue to cover the
basic
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salary, benefits, and leave for those employees providing direct
service delivery and administrative salaries and benefits, as well as
contributing to overall overhead cost recovery. GIPSA has also
identified that part of the hourly rate that is directly attributable
to salaries and benefits and certain unit fees for services not
performed at an applicant's facility that contain labor costs. This
rule increases those hourly rates and unit fees based on an approximate
3.6 percent increase to the labor cost of each hourly rate and unit.
The amount of revenue collected under this rule will be a direct
result of the work volume. GIPSA estimates an annual increase of
$155,356 in revenue (assuming fiscal year 1998 volume equivalents). If
GIPSA foregoes this adjustment, GIPSA will incur a net loss equivalent
to the approximate 3.6 percent Federal salary increase for every hour
worked by an employee providing direct service delivery and
administrative personnel.
In fiscal year 1998, GIPSA's obligations were $3,820,820 with
revenue of $4,011,446, resulting in a positive margin of $190,626 and
retained earnings of negative $895,584. GIPSA cannot afford to absorb a
$155,356 loss due to the approximate 3.6 percent increase in salary
costs with the existing deficit in retained earnings. Additionally,
GIPSA will continue to monitor its costs to improve operating
efficiencies and adopt cost saving measures, where possible and
practicable.
Comment Review
GIPSA received one comment during the 60-day comment period. The
commenter, a grain trade association representing grain, feed, and
processing companies, opposed the fee increase, stating that the agency
is simply passing on increased costs to users of the rice inspection
program without first relying on cost saving measures and improved
efficiencies to offset the anticipated increase in salaries for Federal
employees. The comment went on to say that the agency should look at
current activities to determine where programs can be streamlined,
staffing can be reduced or be made more efficient, and services can be
automated as the primary method to control costs and re-build the 3-
month operating reserve in the trust fund account.
GIPSA is required by the AMA to recover its costs for providing
rice inspection services by establishing reasonable fees to cover their
estimated costs. The 3.6 percent increase is consistent with the
provisions of the AMA concerning the establishment of fees. Absorbing
the average 3.6 percent salary increase is impractical considering the
extremely low retained earnings of negative $895,584. Further, GIPSA
has conducted numerous cost saving measures in the past few years,
early retirements, field office consolidations, and reduction in travel
and training. GIPSA will continue to monitor its costs to improve
operating efficiencies and adopt cost saving measures, where possible
and practicable.
Final Action
Section 203 of the AMA (7 U.S.C. 1622) provides for the
establishment and collection of fees that are reasonable and, as nearly
as practicable, cover the costs of the services rendered. These fees
cover the GIPSA costs, including administrative and supervisory costs,
for the performance of official services, including personnel
compensation, personnel benefits, travel, rent, communications,
utilities, contractual services, supplies, and equipment.
It is found that good cause exists for not postponing the effective
date of this rule until 30 days after publication in the Federal
Register (5 U.S.C. 553) because: (1) Given the current level of the
operating reserve, the fee increase should be implemented as soon as
possible, and (2) the effective date coincides with the beginning of a
billing cycle.
In Section 868.91, Tables 1 and 2 are revised to provide for the
increases in rice inspection fees.
List of Subjects in 7 CFR Part 868
Administrative practice and procedure, Agricultural commodities.
For reasons set out in the preamble, 7 CFR Part 868 is amended as
follows:
PART 868 --GENERAL REGULATIONS AND STANDARDS FOR CERTAIN
AGRICULTURAL COMMODITIES
1. The authority citation for part 868 continues to read as
follows:
Authority: Secs. 202-208, 60 Stat. 1087, as amended (7 U.S.C.
1621 et seq.).
2. Section 868.91 is revised to read as follows:
Sec. 868.91 Fees for certain Federal rice inspection services.
The fees shown in Tables 1 and 2 apply to Federal Rice Inspection
Services.
Table 1.--Hourly Rates/Unit Rate Per CWT
[Fees for Federal Rice Inspection Services]
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Regular Nonregular
workday workday
Service \1\ (Monday- (Sunday-
Saturday) holiday)
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Contract (per hour per Service
representative)........................ $40.80 $56.80
Noncontract (per hour per Service
representative) \2\.................... 50.00 69.00
Export Port Services \2\................ 0.05 0.05
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\1\ Original and appeal inspection services include: Sampling, grading,
weighing, and other services requested by the applicant when performed
at the applicant's facility.
\2\ Services performed at export port locations on lots at rest.
TABLE 2.--Unit Rates
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Brown rice for
Service 1,3 Rough rice processing Milled rice
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Inspection for quality (per lot, sublot, or sample inspection).. $32.90 $28.40 $20.20
Factor analysis for any single factor (per factor):
(a) Milling yield (per sample).............................. 25.50 25.50
(b) All other factors (per factor).......................... 12.10 12.10 12.10
Total oil and free fatty acid interpretive line samples: \2\.... 40.00 40.00
(a) Milling degree (per set)................................ 85.10
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(b) Parboiled light (per sample)............................ 21.30
Extra copies of certificates (per copy)..................... 3.00 3.00 3.00
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\1\ Fees apply to determinations (original or appeals) for kind, class, grade, factor analysis, equal to type,
milling yield, or any other quality designation as defined in the U.S. Standards for Rice or applicable
instructions, whether performed singly or combined at other than at the applicant's facility.
\2\ Interpretive line samples may be purchased from the U.S. Department of Agriculture, GIPSA, FGIS, Technical
Services Division, 10383 North Executive Hills Boulevard, Kansas City, Missouri 68030. Interpretive line
samples also are available for examination at selected FGIS field offices. A list of field offices may be
obtained from the Director, Field Management Division, USDA, GIPSA, FGIS, 1400 Independence Avenue, SW, STOP
3630, Washington, DC 20250-3630. The interpretive line samples illustrate the lower limit for milling degrees
only and the color limit for the factor ``Parboiled Light'' rice.
\3\ Fees for other services not referenced in Table 2 will be based on the noncontract hourly rate listed in
Section 868.90, Table 1.
James R. Baker,
Administrator.
[FR Doc. 99-3338 Filed 2-11-99; 8:45 am]
BILLING CODE 3410-EN-P
