U.S. Grain Standards Act: Overview and Issues for Possible Reauthorization
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U.S. Grain Standards Act: Overview and
Issues for Possible Reauthorization
June 23, 2025
Congressional Research Service
https://crsreports.congress.gov
R48577
SUMMARY
U.S. Grain Standards Act: Overview and Issues
for Possible Reauthorization
The U.S. Grain Standards Act (USGSA) of 1916, as amended (P.L. 64-190; 39 Stat. 482, 7
U.S.C. §§71 et seq.), authorizes the Secretary of the U.S. Department of Agriculture (USDA) to
establish official marketing or quality standards for certain grains: barley, canola, corn, flaxseed,
mixed grain, oats, rye, sorghum, soybeans, sunflower seed, triticale, and wheat. Under the
USGSA, USDA, through the Federal Grain Inspection Service (FGIS), also conducts official
grain inspections and weighing services and supervises official services conducted by authorized
state and private agencies.
R48577
June 23, 2025
Stephanie Rosch
Analyst in Agricultural
Policy
Although most provisions of the USGSA are permanently authorized, several are set to expire on September 30, 2025. These
provisions authorize annual appropriations for standards development and maintenance, provide USDA with authority to
charge fees for supervision of inspections and weighing, apply an administrative/supervisory cost cap, and authorize the grain
inspection advisory committee. A lapse in authorization might, depending on its duration, disrupt aspects of the grain
inspection and weighing program.
Congress enacted the USGSA to encourage the marketing of high-quality grain, particularly for export. The USGSA requires
exported grains to be officially inspected and weighed. Inspections and weighing of domestically marketed grain, while often
done, are optional. On average, 58% of eligible grain produced in the United States was officially inspected each year in
2015-2024, and grain for export accounted for 42% of officially inspected grain on average. Voluntary inspections of
domestically marketed grain accounted for more than half of all inspected grain in each year of that period.
Under the USGSA, FGIS may delegate to certain states responsibility for grain inspection at export ports. FGIS may also
designate state and private sector agencies as official service providers at non-port locations. Delegated and designated
agencies operate within specific geographic areas established by USDA. The USGSA requires USDA to establish boundaries
so that each area contains one official inspection agency, with limited exceptions. In FY2023, FGIS supervised 4 delegated
state agencies, 6 designated state agencies, and 31 designated private sector agencies.
The USGSA requires USDA and delegated and designated agencies to charge user fees for official grain inspections and
weighing. Activities such as developing grain standards and procedures for measuring quality are financed with
congressionally appropriated funds. Statute requires FGIS to update fees annually and set an amount of fees adequate to
maintain an operating reserve of between three and six months of expenses. Since 2015, FGIS has faced challenges in
meeting the requirement on operating reserves. FGIS did not meet the requirement on at least one operating reserve account
in each of FY2021-FY2024.
The USGSA’s expiring provisions were most recently reauthorized in the U.S. Grain Standards Reauthorization Act of 2020
(P.L. 116-216). The act also included provisions addressing discontinuance of services, FGIS reporting requirements, funding
from appropriations and user fees, terms of service on the advisory committee, and the geographic boundaries for designated
agencies.
The 119th Congress may consider reauthorizing USGSA’s expiring provisions. Among other topics, Congress may also
consider addressing policy issues related to requirements on user fees, USDA’s authorities to grant waivers of geographic
boundaries, USDA’s authorities to invest operating reserves in interest-bearing accounts, and USDA’s role in supporting
commercialization of new grain inspection technologies.
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U.S. Grain Standards Act: Overview and Issues for Possible Reauthorization
Contents
Introduction ..................................................................................................................................... 1
The U.S. Grain Standards Act ......................................................................................................... 3
U.S. Grain Inspection and Weight Standards .................................................................................. 5
U.S. Grain Inspection System ......................................................................................................... 5
Businesses Purchasing Official Grain Inspections .................................................................... 6
Official Service Providers of Grain Inspections........................................................................ 6
Geographic Area Boundaries for Official Service Providers .................................................... 7
Fee Schedules ............................................................................................................................ 9
Trends in Official Grain Inspections ....................................................................................... 10
Funding for the Federal Grain Inspection Service......................................................................... 13
Limits on FGIS’s Use of User Fees ......................................................................................... 14
Limits on Operating Reserves ................................................................................................. 15
Grain Inspection Advisory Committee .......................................................................................... 17
Expiring Provisions of the USGSA ............................................................................................... 17
Issues for Congress ........................................................................................................................ 18
Figures
Figure 1. Grain Production and Inspections, 2015-2024 ................................................................. 2
Figure 2. Official Agency Geographic Areas and FGIS Offices as of 2024 .................................... 8
Figure 3. Official Grain Inspections for Exported and Domestically Marketed Grain ................. 10
Figure 4. Share of Exported Grain Officially Inspected by FGIS, Delegated States, and
Designated Agencies, FY2015-FY2024 ..................................................................................... 12
Figure 5. Officially Inspected Grain for Export by Transportation Mode ..................................... 13
Figure 6. FGIS Appropriations and Obligations from User Fees, FY2015-FY2023..................... 14
Tables
Table 1. Official Inspections for Exported Grain by Type of Agency, FY2015-FY2024 ...............11
Table 2. FGIS User Fee Accounts, FY2020-FY2024 .................................................................... 15
Table A-1. U.S. Grain Standards Act (USGSA), Regulations and Other Information .................. 21
Table B-1. USGSA Legislative History and Selected Provisions.................................................. 22
Appendixes
Appendix A. References for the U.S. Grain Standards Act ........................................................... 21
Appendix B. U.S. Grain Standards Act Legislative History ......................................................... 22
Appendix C. U.S. Grain Standards Act Through the Years ........................................................... 24
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U.S. Grain Standards Act: Overview and Issues for Possible Reauthorization
Contacts
Author Information........................................................................................................................ 29
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U.S. Grain Standards Act: Overview and Issues for Possible Reauthorization
Introduction
The U.S. Grain Standards Act (USGSA) of 1916, as amended (P.L. 64-190; 39 Stat. 482, 7 U.S.C.
§§71 et seq.), authorizes the Secretary of the U.S. Department of Agriculture (USDA) to establish
official marketing or quality standards for certain grains and requires exported grains to be
officially inspected (if sold by grade) and weighed.1 Although most provisions of the USGSA are
permanently authorized, four provisions are scheduled to expire on September 30, 2025. These
four provisions control funding available for supervision of the grain inspection program and the
authorities for the program’s advisory committee. Congress last reauthorized the USGSA in the
U.S. Grain Standards Reauthorization Act of 2020 (2020 reauthorization act; P.L. 116-216). The
119th Congress may consider further reauthorization of the provisions set to expire, as a lapse in
authorization might disrupt aspects of the grain inspection and weighing program.
Within USDA, the Federal Grain Inspection Service (FGIS) conducts official grain inspections
and weighing services and supervises official services conducted by authorized state and private
agencies. Exported grains are officially inspected (if sold by grade) and weighed. For domestic
grains, inspections and weighing are optional.
Official grain standards under the USGSA are to facilitate the marketing of high-quality grains
domestically and for export by enabling buyers and sellers to determine quality (and therefore
value) of these commodities. For example, buyers of corn may use an official grade to signify the
likely value of that corn for use as livestock feed. The official grain standards also can be
incorporated into private contracts and used for promoting grain trade. The official grain
standards are widely used by the agricultural sector. On average, more than half of eligible grain
produced in the United States was officially inspected each year in 2015-2024 (Figure 1).
1 These standards do not include health or safety standards, such as protein content or presence of mycotoxin.
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U.S. Grain Standards Act: Overview and Issues for Possible Reauthorization
Figure 1. Grain Production and Inspections, 2015-2024
Source: CRS calculations using U.S. Department of Agriculture (USDA), National Agricultural Statistics Service,
Quickstats database, downloaded April 14, 2025; and USDA, Agricultural Marketing Service (AMS), Federal Grain
Inspection Service Annual Report to Congress, various years.
Notes: “Grain” includes agricultural commodities with standards authorized under the U.S. Grain Standards Act
(7 U.S.C. §§71 et seq.). “Grain produced” is by marketing year, and “grain inspected” is by fiscal year. Grain
inspected includes mandatory and voluntary inspections. A marketing year is the 12-month period that begins at
harvest time and varies by commodity. Marketing years do not align with fiscal years for any grains inspected
under the U.S. Grain Standards Act. Consequently, the above figure is illustrative in nature.
Brief History of the USDA Federal Grain Inspection Service (FGIS)
Prior to 1976, USDA did not directly perform official grain inspections. State, local, and private sector agencies
conducted official grain inspections under licenses authorized by the Secretary of Agriculture. Since 1976,
Congress has authorized USDA to conduct official grain inspections, with the authority to conduct official
inspections placed with different officials over time. The current authority resides with the Secretary of
Agriculture, and FGIS is a program area implementing this authority from within the Agricultural Marketing Service
(AMS). Congress established FGIS as an independent agency reporting to the Secretary and provided such
authority to the FGIS administrator directly. A brief history of FGIS’s evolution from independent agency to
program area is provided below.
Congress established FGIS in 1976 as an independent agency within USDA in response to criminal investigations
regarding the credibility of the U.S. grain inspection system (see Appendix C). Congress specified that the FGIS
administrator was to be responsible for implementing the U.S. Grain Standards Act (USGSA), including developing
and maintaining grain standards, conducting grain inspections at certain export locations, and supervising grain
inspections at other locations. Per statutory requirement, the FGIS administrator reported directly to the
Secretary of Agriculture.
When FGIS was created, multiple independent agencies reported to the Secretary of Agriculture, including the
Packers and Stockyards Administration (PSA). PSA was established in 1921 through the Packers and Stockyards
Act (P.L. 67-51, 7 U.S.C. §§181 et seq.) and was to regulate livestock marketing activities at public stockyards and
operations of meat packers and live poultry dealers.2
2 U.S. Department of Agriculture (USDA), “About GIPSA: History and Mission,” accessed on May 21, 2025, through
(continued...)
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In 1994, Congress passed the Federal Crop Insurance Reform and Department of Agriculture Reorganization Act
of 1994 (P.L. 103-354). Among other provisions, the act directed the Secretary of Agriculture to consolidate
agencies within USDA and transferred authority for official grain inspections from the FGIS administrator to the
Secretary of Agriculture. In accordance with this directive, the Secretary of Agriculture combined FGIS and PSA
into a new agency: the Grain Inspection, Packers, and Stockyards Administration (GIPSA).
In 2017, the Secretary of Agriculture reorganized various USDA agencies and offices with the stated goals of
consolidating functions and improving efficiencies and customer service.3 As part of the reorganization, the
Secretary merged GIPSA into the Agricultural Marketing Service (AMS), and FGIS became a program area within
AMS.4
The U.S. Grain Standards Act
Congress determined that “grain is an essential source of the world’s total supply of human food
and animal feed” and that promoting grain trade is in the interest of “the general welfare of the
people of the United States,” as well as the grain sector. Congress enacted the USGSA to establish
official grain standards and promote official grain inspections and weighing in order to facilitate
orderly and timely marketing of high-quality grain for interstate and foreign commerce.5
The USGSA requires the Secretary of Agriculture to establish standards for barley, canola, corn,
flaxseed, mixed grain, oats, rye, sorghum, soybeans, sunflower seed, triticale, and wheat.6 The
standards are to address the cleanliness, physical soundness, purity, and moisture content of the
grain. The USGSA authorizes appropriations of $23 million for each of FY2021 through FY2025
to carry out these activities.7 Actual funding levels are subject to annual appropriations.
The USGSA requires that exported grain and oilseeds be officially inspected and weighed, with
certain exceptions.8 Domestically marketed grain and oilseeds can be officially inspected and
weighed, but doing so is not required. Inspected grain receives an official certificate that
documents the inspection date and location, procedures applied, and results.9
the web archive at https://web.archive.org/web/20060408155751/http://www.gipsa.usda.gov/GIPSA/webapp?area=
about&subject=landing&topic=hm.
3 USDA, “Secretary Perdue Announces USDA Improvements for Customer Service & Efficiency,” press release,
September 7, 2017, https://www.usda.gov/about-usda/news/press-releases/2017/09/07/secretary-perdue-announcesusda-improvements-customer-service-efficiency.
4 Under USDA’s 2017 reorganization plan, responsibilities for enforcing the Packers and Stockyards Act were
transferred to the Packers and Stockyards Division within the Agricultural Marketing Service’s (AMS’s) Fair Trade
Practices Program.
5 7 U.S.C. §74.
6 7 U.S.C. §76(a). The Federal Grain Inspection Service (FGIS) also establishes standards for beans, certain pulses, and
rice under the Agricultural Marketing Act (AMA) of 1946 (60 Stat. 1087 and 1090, 7 U.S.C. §1622 and §1624), as
amended.
7 7 U.S.C. §87h.
8 7 U.S.C. §77(a). The USGSA excepts from this requirement grain that is officially inspected and weighed at domestic
locations, grain during emergency situations, and grain in the event that the parties to the contract mutually agree to
waive the requirement. In 7 C.F.R. §800.18, USDA established waivers for exporters and grain elevators who export
less than 15,000 metric tons of grain annually; grain exported for seeding purposes; grain shipped in bond; grain
exported by rail or truck to Canada or Mexico; grain not sold by grade; grain for which service is not available within
24 hours and the buyer and seller of grain are informed of the lack of official inspection; and high-quality specialty
grain shipped in containers.
9 For more information about the types of certificates available, see USDA, AMS, “Certificates and Inspection Data
Warehouse,” https://www.ams.usda.gov/services/fgisonline/idw-cert.
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U.S. Grain Standards Act: Overview and Issues for Possible Reauthorization
Official export inspections are carried out by federal inspectors or federally supervised inspection
agencies.10 Federally supervised inspection agencies include delegated state agencies and
designated state or private sector agencies. Delegated state agencies are authorized to perform
official inspections and weighing at export port locations. Designated state and private sector
agencies are authorized to perform official inspections and weighing at locations other than
export ports. Under the USGSA, the Secretary of Agriculture may permit delegated and
designated agencies to perform all or a portion of the functions required for official inspections
(but not for appeal inspections).
Delegated and designated agencies operate in specific geographic areas established by USDA.
The USGSA requires the Secretary of Agriculture to establish the boundaries so that each area
contains no more than one official inspection agency, with limited exceptions (see “Geographic
Area Boundaries for Official Service Providers”).11
The USGSA requires USDA to charge user fees for official inspections (see “Fee Schedules”).12
For inspections conducted by FGIS, the USGSA requires that the fees cover the costs of
performing official inspection services, including administrative and supervisory costs. For
inspections conducted by delegated and designated agencies, the USGSA requires the Secretary
of Agriculture to charge fees to cover the costs of supervising those agencies. The USGSA also
requires the Secretary of Agriculture to adjust fees at least once per year to maintain an operating
reserve equivalent to between three and six months of operating costs.
The USGSA also prohibits deceptive practices with respect to the inspection and weighing of
grain and provides penalties for violations of the act. Prohibitions include altering official
certificates, exporting grain without official personnel on site, and adding foreign material to any
grain.
The USGSA requires the Secretary of Agriculture to report to Congress annually on the
effectiveness of grain inspections and weighing services.13 The 2020 reauthorization act requires
the Secretary of Agriculture to provide quarterly reports on certain quality and food safety factors
that USDA previously had reported annually, the number of geographic area exemptions
requested and granted, and the number of waivers for official inspections and weighing services
requested and granted.14 The law also grants the Secretary of Agriculture the option to publish
additional testing, inspection, and weighing data, in consultation with state and official agencies
and the grain industry. USDA must also protect any trade secret and business information
collected.
Although most provisions of the USGSA are permanently authorized, four have expiration dates
(see “Expiring Provisions of the USGSA”). These four provisions address authorizations for
funding available for the grain inspection program and the authorities for the grain inspection
advisory committee (GIAC).
10 Other private entities may provide grain inspections, but only delegated and designated agencies may issue official
inspection certificates.
11 7 U.S.C. §79(f)(2).
12 7 U.S.C. §79(j). The Agricultural Marketing Act of 1946 does not require USDA to charge user fees. The act
providing FY2000 appropriations for USDA (P.L. 106-387) prohibits inspection and certification of certain
commodities under the AMA unless USDA (1) inspects and certifies the equipment used and (2) imposes a fee for
inspection and certification. This provision requires USDA to charge fees for official inspections under the AMA for
beans, hops, processed commodities, pulses, and rice.
13 7 U.S.C. §87f–2.
14 Quarterly reports on exceptions and waivers are available at USDA, AMS, “FGIS Reports and Publications,”
https://www.ams.usda.gov/reports/fgis-reports-and-publications.
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Appendix A contains links to the USGSA’s statutory provisions, associated regulations, official
service providers, and other information.
U.S. Grain Inspection and Weight Standards
The USGSA requires the Secretary of Agriculture to establish standards for barley, canola, corn,
flaxseed, mixed grain, oats, rye, sorghum, soybeans, sunflower seed, triticale, and wheat. USDA
has promulgated regulations in 7 C.F.R. §810 that define each of these grains, the classes of each
grain (e.g., yellow corn, white corn), and numerical grades (e.g., no. 1, no. 2).15 The grades are
based on physical characteristics, such as minimum weight per bushel and maximum percentage
of defects (e.g., foreign material, damaged kernels).
The USGSA requires exported grain to be officially weighed. USDA refers to weighing
conducted by FGIS as Class X weighing and weighing conducted by delegated and designated
agencies as Class Y weighing. USDA regulations in 7 C.F.R. §800 and §802 define the
requirements for Class X and Class Y weighing procedures and equipment.
FGIS periodically reviews and updates existing standards. For example, in 2022, FGIS completed
reviews for canola and wheat standards.16 In 2023, FGIS amended the soybean standard for color
to remove grading qualifications that generated adverse grades for certain newly introduced
varieties of genetically modified soybeans.17
U.S. Grain Inspection System
Under the USGSA, official grain inspections and weighing services are required for exported
grain (with certain exceptions) and voluntary for domestically marketed grain. Grain exporters
pay user fees for all official grain inspections and weighing, regardless of whether the inspection
is mandatory or voluntary. The amount of the user fee depends on the agency conducting the
inspection, and the agency assigned to conduct the inspection depends on where the inspection
takes place. For example, official grain inspections and the weighing of grain that is exported via
bulk shipping typically occur at a port. Depending on the port, either FGIS or a delegated state
agency would conduct those inspections. For grain that is exported using other modes of
transportation (e.g., rail, truck, container shipping) and for grain that is marketed domestically,
official inspections and weighing services most often occur at grain elevators as the grain is
loaded for shipment.18 Designated agencies commonly provide official inspections at grain
elevators not located at ports.
15 The standards for rice—established under the AMA—are defined in 7 C.F.R. §868.
16 USDA, 2024 USDA Explanatory Notes – Agricultural Marketing Service, accessed on May 21, 2025,
https://www.usda.gov/sites/default/files/documents/24-2024-AMS.pdf.
17 USDA, 2025 USDA Explanatory Notes – Agricultural Marketing Service, accessed on May 21, 2025,
https://www.usda.gov/sites/default/files/documents/23-AMS-2025-ExNotes.pdf.
18 FGIS reported that official certificates were issued in over 2,000 cities in the United States and British Columbia,
Canada, in 2017-2021 and provided an interactive data visualization of those locations at USDA, AMS, “USDA FGIS
Boundary Review,” https://agtransport.usda.gov/stories/s/a384-djzj. USDA, AMS, United States Department of
Agriculture, Agricultural Marketing Service’s Federal Grain Inspection Service: Review of Geographic Area
Boundaries, October 2022, https://www.ams.usda.gov/sites/default/files/media/GeographicalBoundaryReview.pdf
(hereinafter USDA, AMS, Review of Geographic Area Boundaries).
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Businesses Purchasing Official Grain Inspections
The USGSA requires grain exporters and persons who handle, weigh, or transport grain for export
to register with USDA and pay fees for official grain inspections. USDA regulations define a
grain exporter for the purposes of the USGSA as a business that regularly buys, handles, weighs,
or transports at least 15,000 metric tons of grain per year for sale in foreign commerce.19 In 2024,
174 businesses were registered to export grain, 31 of which qualified as “large firms,” according
to the Small Business Administration’s criteria (i.e., firms with receipts in excess of $34
million).20 The large firms accounted for the majority of grain inspected and fees paid in 20192023.
Official Service Providers of Grain Inspections
Entities authorized to provide official grain inspections and weighing include FGIS, delegated
state agencies, and designated state and private agencies. Other (unofficial) inspection companies
may perform grain inspections and weighing but are not authorized to issue official inspection
certificates. In 2022, 42 state and private agencies and 2,700 licensed or authorized personnel
provided official grain inspections (including FGIS staff).21
•
•
•
FGIS. FGIS is headquartered in Washington, DC. Most FGIS employees are
located at the National Grain Center in Kansas City, MO. FGIS has six field
offices located in Kansas City, MO; League City, TX; New Orleans, LA;
Portland, OR; Stuttgart, AR; and Toledo, OH. FGIS also provides mandatory
inspections and weighing services at 29 export facilities nationwide. In FY2023,
FGIS had 379 permanent employees, 15 intermittent employees, and 54
temporary employees.22
Delegated state agencies. As of FY2024, FGIS supervised delegated agencies in
four states: Alabama, Virginia, Washington, and Wisconsin. These agencies may
perform official grain inspections, weighing, and scale testing services. The
USGSA requires USDA to evaluate and recertify delegated states every five
years.23 USDA recertified Virginia and Wisconsin in 2020 and Alabama and
Washington in 2024.24
Designated state agencies. As of FY2024, FGIS supervised designated state
agencies in six states: Louisiana, Maryland, Missouri, Montana, North Carolina,
and Utah. These agencies may perform official grain inspections and weighing.
The USGSA requires USDA to review designated states every five years.25
19 7 C.F.R. §800.30 and §800.31.
20 USDA, AMS, “Fees for Official Inspection and Weighing Services Under the United States Grain Standards Act,” 89
Federal Register 105381, December 27, 2024.
21 USDA, AMS, Review of Geographic Area Boundaries.
22 USDA, AMS, Federal Grain Inspection Service 2023 Annual Report to Congress, April 2024,
https://www.ams.usda.gov/sites/default/files/media/FGISFY23AnnualReport.pdf.
23 7 U.S.C. §79(e)(2).
24 USDA, AMS, “Certification of Export Port Locations for Alabama and Washington and Geographic Areas Under the
Delegated Authority of United States Grain Standards Act,” 89 Federal Register 82199, October 10, 2024; and USDA,
AMS, “Certification of Alabama, Virginia, Washington, and Wisconsin to Provide Official Services at Export Port
Locations Under a Delegation; Cancellation of South Carolina’s Delegation,” 85 Federal Register 84293, December
28, 2020.
25 7 U.S.C. §79(g). Prior to October 2015, designations were for three-year terms.
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•
USDA completed reviews and redesignated Louisiana, Maryland, North
Carolina, and Utah in 2021 and Missouri and Montana in 2022.26
Designated private agencies. As of FY2024, FGIS supervised 31 private
agencies authorized to conduct official domestic inspections and weighing
services for domestic grain marketing. The USGSA requires USDA to review
designated private agencies every five years.27 In 2024, FGIS solicited
competition for the designated private agencies serving Fargo, ND, and Keokuk,
IA, and the regions of Lower Northwest Texas and Southeast Texas.28
FGIS supervises all delegated and designated agencies. All employees of an approved agency
must be licensed, and the agencies’ lab equipment must meet federal standards. Delegated
agencies that temporarily discontinue official inspections or weighing services are required to
notify USDA at least 72 hours in advance. This provision was added during the 2015 USGSA
reauthorization in response to disruptions caused by labor strikes at port facilities (see Appendix
C). The 2020 reauthorization act added a requirement for states to also notify affected customers.
FGIS approves user fees charged by state and private agencies for official inspections and
weighing, which must be “reasonable.”29 An additional fee is charged by FGIS for supervising
official inspection and/or weighing services.
In addition to official inspections, agencies may choose to perform other types of inspections
(e.g., stowage inspections, inspections for nutritional and safety standards). FGIS performs
certain types of nonofficial inspections at customers’ requests for additional fees. FGIS does not
supervise nonofficial inspections performed by state agencies or the private sector.
Geographic Area Boundaries for Official Service Providers
Under the USGSA, delegated state agencies have the authority to perform official grain
inspections and weighing services at port locations within their states (7 U.S.C. §79(e)). For
designated agencies, the USGSA requires USDA to establish geographic boundaries wherein a
designated agency is the sole authorized provider of official grain inspections and weighing
services (7 U.S.C. §79(f)(2)). Figure 2 shows the boundaries that were in effect for FY2024.
Geographic areas are often bounded by state or county lines, and some geographic areas include
multiple states and/or counties in multiple states. In some cases, geographic areas are bounded by
rivers, landmarks, or roads within counties. USDA stated that it defined certain geographic areas
to include only portions of counties “in an effort of evenly distribute grain merchandising
locations among geographic areas.”30
26 USDA, AMS, “Award of Designations and Designation Amendments to Class X or Class Y Weighing Services
Under the United States Grain Standards Act,” 87 Federal Register 67855, November 10, 2022; and USDA, AMS,
“Certification of Export Port Locations for Alabama and Washington,” 89 Federal Register 82199, October 10, 2024.
27 7 U.S.C. §79(g).
28 USDA, AMS, “Opportunities for United States Grain Standards Act Designation in the Lower Northwest Texas
Area; the Southeast Texas Area; the Keokuk, Iowa Area; and the Fargo, North Dakota Area,” 89 Federal Register
58327, July 18, 2024.
29 USDA regulations (7 C.F.R. §800.70) specify that fees are to cover the cost of inspections and weighing services, be
consistent with similar fees assessed by adjacent agencies, be assessed based on the average cost of similar services at
all locations, and be supported by information showing how the fees were developed. Approved fee schedules are
posted at USDA, AMS, “FGIS OSP,” https://www.ams.usda.gov/fgis-osp.
30 USDA, AMS, “Geographic Areas for Official Grain Inspection Services,” 90 Federal Register 2664, January 13,
2025.
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The 2020 reauthorization act required USDA to conduct a comprehensive review of the official
agency geographic areas. USDA published its review results in October 2022.31 On January 13,
2025, USDA announced updates to the boundaries to address changes in natural and man-made
landmarks, railroad lines, roads, and signs.32 USDA also established new identifiers for the
geographic areas (e.g., new “Area 1” is the geographic area previously labeled “State of
Alabama”).
Figure 2. Official Agency Geographic Areas and FGIS Offices as of 2024
Source: USDA, AMS, Federal Grain Inspection Service FY2024 Annual Report to Congress, March 2025, p. 6.
Notes: DIOO = Domestic Inspection Operations Office. Agencies provide sole service within their delineated
geographical areas. Delineated geographical areas for state agencies may not correspond with state boundaries.
The Federal Grain Inspection Service (FGIS) provides official inspections for unassigned areas, and the FGIS
Pacific Northwest office provides official inspections for Alaska and Hawaii (not illustrated on the map).
Information about grain inspections for the insular territories may be available from USDA on request. In January
2025, USDA clarified boundaries that do not correspond with state or county boundaries and established new
identifiers for geographic areas as Area 1, Area 2, for example, to Area 44. For additional information, see
USDA, AMS, “Geographic Areas for Official Grain Inspection Services,” 90 Federal Register 2664, January 13,
2025.
Within each geographic boundary, one official service provider is authorized to provide official
grain inspections and weighing. Congress established the requirement for geographic boundaries
in 1976 in response to criminal activity involving grain inspectors in the 1970s (see Appendix C
for details). Establishing one official grain inspection agency within a geographic boundary is to
prevent exporters from “grade shopping” from different agencies and help ensure the agency
receives enough business to remain financially viable and maintain qualified staff for on-site
laboratories.
31 USDA, AMS, Review of Geographic Area Boundaries.
32 USDA, AMS, “Geographic Areas for Official Grain Inspection Services,” 90 Federal Register 2664, January 13,
2025.
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Over time, the number of designated agencies and geographic areas has declined. In 1979, there
were 86 designated agencies, declining to 62 in 1999, and 43 in 2019.33 This trend may reflect
business closures, consolidations, and competition in the designation process.
All official service providers must provide official inspections in accordance with FGIS
standards, but agencies may differ in terms of the auxiliary services they offer and in their
adoption of new technologies to facilitate grading, among other differences. Inspection customers
who prefer to have their official inspections performed by an agency other than their assigned
official service provider may seek waivers of the geographic boundary restriction. Congress
amended the USGSA in 2015 and in 2018 to address waivers to geographic boundary
requirements (see Appendix C). As amended, the USGSA allows USDA to grant waivers under
the following circumstances:
•
•
•
•
the official inspection agency cannot conduct a timely inspection,
the requester is not a previously existing customer of the official agency (i.e.,
nonuse of the official agency),
the requester is requesting a probe inspection of grain transported on barges, or
the official inspection agency agrees in writing to waive the geographic area
restriction.
On May 3, 2023, USDA published a final rule to update the waivers available for timely
inspections and nonuse of the official agency and USDA’s process for granting waivers.34 In April
2025, there were 47 active exceptions to USGSA geographic boundaries, all granted on the basis
of nonuse of the official agency.35
Fee Schedules
Exporters pay fees to cover the costs of grain inspections and weighing services. These fees are
paid directly to FGIS for services conducted by its personnel and directly to delegated and
designated agencies for their services. FGIS charges additional fees to delegated and designated
agencies to cover the costs of its supervision of those agencies. In 2015, Congress amended the
USGSA to require that USDA adjust fee schedules annually and set fees at levels adequate to
maintain an operating reserve of between three and six months of FGIS expenses (see Appendix
C).36
FGIS charges an hourly fee for labor and a tonnage fee for inspections conducted by its
personnel. These fees are applied uniformly for all grain inspected by FGIS personnel under the
USGSA.37 Statute requires FGIS to calculate tonnage fees based on the rolling five-year average
of export tonnage volumes.38 For inspections conducted by delegated and designated agencies,
FGIS charges a supervisory fee per metric ton of grain inspected and/or weighed. FGIS also
33 USDA, AMS, Review of Geographic Area Boundaries.
34 USDA, AMS, “Exceptions to Geographic Boundaries,” 88 Federal Register 27685, May 3, 2023.
35 USDA, AMS, “MyFGIS; Active Exceptions to USGSA Geographic Boundaries,” downloaded April 11, 2025,
https://fgisonline.ams.usda.gov/MyFGIS/USGSAExceptions/Index.
36
7 U.S.C. §79(j)(4) and 7 U.S.C. §79a(i)(3).
37 FGIS charges different fees for rice and other commodities inspected under the AMA.
38 7 U.S.C. §79(j).
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charges fees for sampling, additional tests, appeal inspections, stowage examinations, and other
services offered.39
FGIS regulates the fees charged by delegated and designated agencies to ensure they are
“reasonable and nondiscriminatory” (7 C.F.R. §800.70). Delegated and designated agencies may
differ from each other in fees charged for specific services, but an agency must charge the same
fees to all customers purchasing a particular service. Local labor costs, travel distances, and
others factors may contribute to the variation in fees charged by different agencies. FGIS
examines various factors to assess the reasonableness of an agency’s proposed fee schedule,
including the estimated total cost to the delegated or designated agency, consistency with fees
charged by geographically adjacent agencies, the average cost of performing similar services at
all locations served by the agency, and documentation for how the agency developed the
proposed fee schedule.
Trends in Official Grain Inspections
More than half of the eligible grain produced in the United States received official inspections
under the USGSA each year in 2015-2024 (Figure 1). Official inspections are mandatory for
exported grain and voluntary for domestically marketed grain. Grain for export accounted for
42% of officially inspected grain on average in FY2015-FY2024 (Figure 3); 58% of officially
inspected grain was voluntarily inspected on average in that period.
Figure 3. Official Grain Inspections for Exported and Domestically Marketed Grain
Source: Figure created by CRS using USDA, AMS, Federal Grain Inspection Service Annual Report to Congress,
various years.
Note: “Inspections” include mandatory and voluntary inspections.
39 The fee schedule is published as FGIS Directive 9080.74, Service Fees and Billing Codes,
https://www.ams.usda.gov/sites/default/files/media/FGISDirective9180_74.pdf.
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FGIS records indicate the type of agency providing official inspections of exported grain. FGIS
provided the official inspections for more than half of exported grain each year in FY2015FY2024 (Table 1). Between FY2015 and FY2024, the share of exported grain officially inspected
by FGIS declined, and the share officially inspected by designated agencies increased (Figure 4).
(FGIS does not provide this information on inspections of domestically marketed grain).
Table 1. Official Inspections for Exported Grain by Type of Agency, FY2015-FY2024
in millions of metric tons
Fiscal Year
FGIS
Delegated States
Designated Agencies
Total
2015
82.4
31.0
11.9
125.3
2016
85.7
35.7
11.8
133.2
2017
91.2
40.2
14.9
146.3
2018
82.0
43.3
15.8
141.1
2019
69.9
32.8
16.9
119.6
2020
73.1
33.3
16.6
123.0
2021
90.8
41.3
19.1
151.2
2022
81.4
37.9
20.3
139.6
2023
64.9
27.6
18.4
110.9
2024
66.1
35.3
24.3
125.7
Source: Figure created by CRS using USDA, AMS, Federal Grain Inspection Service Annual Report to Congress,
various years.
Note: FGIS = Federal Grain Inspection Service.
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Figure 4. Share of Exported Grain Officially Inspected by FGIS, Delegated States,
and Designated Agencies, FY2015-FY2024
Source: Figure created by CRS using USDA, AMS, Federal Grain Inspection Service Annual Report to Congress,
various years.
Notes: FGIS = Federal Grain Inspection Service. Delegated states and designated agencies conduct official grain
inspections in specific geographic territories. FGIS conducts official grain inspections at certain locations
nationwide and supervises inspections conducted by delegated states and designated agencies at all other
locations. Figures exclude officially inspected grain that was marketed domestically.
One factor contributing to the rise in the share of exported grain officially inspected by
designated agencies is change in grain shipping modalities. Between 2015 and 2024, the amount
of officially inspected grain that was exported via bulk shipping remained relatively consistent,
while the amount of officially inspected grain that was exported by rail or via container shipping
increased (Figure 5).40 Official grain inspections of exports for bulk shipping generally occur at
port locations and are conducted by FGIS or delegated state agencies. Official grain inspections
for exports via railroad, container, truck, or other transportation modes generally occur at grain
elevators in various locations nationwide and may be conducted by designated agencies,
delegated states, or FGIS.
40 Bulk shipping of grain refers to specialized ships that can transport relatively large quantities of unpackaged grain.
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Figure 5. Officially Inspected Grain for Export by Transportation Mode
in calendar years 2015 and 2024
Source: CRS calculations using USDA, AMS, FGIS Yearly Export Grain Totals, various years, updated March 10,
2025.
Note: Figures exclude officially inspected grain that was marketed domestically.
Funding for the Federal Grain Inspection Service
FGIS receives funding via congressionally appropriated funds and user fees. Appropriated funds
and user fees are used for FGIS activities authorized under the USGSA and the Agricultural
Marketing Act of 1946 (AMA, 60 Stat. 1087 and 1090, 7 U.S.C. §1622 and §1624).
•
•
Congressionally appropriated funds are used for FGIS development and
maintenance of standards as authorized under the USGSA and AMA. In FY2023,
Congress appropriated $19.342 million for FGIS to develop and maintain
standards under the USGSA and AMA.41 These appropriated funds were less than
the level of authorized appropriations under the USGSA ($23 million).42
User fees fund official inspections (by FGIS and delegated and designated
agencies) and FGIS activities to supervise delegated and designated agencies.
Statute limits USDA’s use of user fees to the funding of direct and administrative
costs for official grain inspections and weighing (including costs associated with
supervising delegated and designated agencies). Statute also prohibits the use of
user fees for development and maintenance of grain standards or other activities
41 USDA, 2025 USDA Explanatory Notes – Agricultural Marketing Service, accessed on May 21, 2025,
https://www.usda.gov/sites/default/files/documents/23-AMS-2025-ExNotes.pdf.
42 The USGSA authorizes appropriations of $23 million per year for FY2021 through FY2025 for development and
maintenance of grain standards under the act. From 1988 to 2020, FGIS was authorized to receive indefinite
appropriations of “such sums as are necessary” for standards development and maintenance. The 2020 reauthorization
act authorized appropriations of $23 million for each of FY2021 through FY2025.
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not directly related to official grain inspections or weighing.43 FGIS budgets for
fees separately for direct inspections and supervisory activities. In FY2023, total
obligations from user fees were $42.519 million, including obligations for
inspections and weighing under the USGSA and AMA.
Between FY2015 and FY2023, congressional appropriations for FGIS standards development and
maintenance activities remained relatively level (Figure 6). FGIS’s use of user fees varied over
that period. Limited user fee income has constrained FGIS operations in recent years. In 2024,
FGIS stated that it had been taking steps to reduce costs for inspections and supervisory activities,
including detailing staff, freezing hiring and awards, and reducing overtime and travel.44
Figure 6. FGIS Appropriations and Obligations from User Fees, FY2015-FY2023
Source: Created by CRS using USDA, 2025 USDA Budget Explanatory Notes, Agricultural Marketing Service, various
years.
Notes: FGIS = Federal Grain Inspection Service. Funds include activities authorized under the U.S. Grain
Standards Act of 1916, as amended, and the Agricultural Marketing Act of 1946, as amended.
Limits on FGIS’s Use of User Fees
FGIS uses income from user fees to cover its costs for official inspections and weighing. These
costs mainly fall into three categories: (1) direct costs associated with FGIS-conducted
inspections and weighing, (2) supervisory costs associated with inspections and weighing
conducted by delegated and designated agencies, and (3) administrative costs.
The amount of user fees that FGIS can expend each year is constrained by multiple factors. The
USGSA limits what FGIS can spend each year on administrative and supervisory costs to 30% of
the total costs of FGIS’s inspections and supervisory activities.45 The limitation requires that as
43
7 U.S.C. §87h(b)(2).
44 USDA, AMS, “Fees for Official Inspection and Weighing Services,” 89 Federal Register 105381.
45 7 U.S.C. §79d.
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direct costs for FGIS-conducted inspections and weighing decrease, FGIS must reduce costs of
administrative and supervisory activities accordingly.46 According to USDA, expenditures for
administrative and supervisory costs are less than 30% of total costs in most years but have
approached the 30% cap in years when FGIS invests in upgrading equipment and technology.47
Appropriations language has limited FGIS’s obligations for inspections and weighing services
from fees collected. In FY2024, the limit on obligations was $55.0 million. Additionally, the user
fee accounts are subject to sequestration.48 For FY2025, the amount sequestered exceeded $2
million.49
Although statute permits FGIS to invest user fees collected in interest-bearing accounts,50 FGIS
has not to date invested any user fees held as operating reserves. FGIS has stated that it has not
been investing user fees because there have been differing USDA legal interpretations on the
permissibility of investing the user fees under the existing statutory provisions.51 Interest
collected on operating reserves could provide additional revenues for use in program operations,
federal government debt reduction, or both. FGIS has stated that the existing statutory
permissions to invest operating reserves may be in conflict with other provisions of the USGSA.52
Limits on Operating Reserves
When reauthorizing the USGSA in 2015, Congress directed FGIS to maintain between three and
six months of operating reserves. Prior to 2015, there was a statutory minimum of three months
and no statutory maximum imposed on operating reserves. There have been several years when
FGIS operating reserves were not within the statutory limits (Table 2). On an annualized basis,
the account for FGIS-conducted inspections was not within the statutory limits for FY2021FY2024, and the account for FGIS supervision of delegated and designated agencies was not
within the statutory limits for FY2020-FY2023.
Table 2. FGIS User Fee Accounts, FY2020-FY2024
$ million, not adjusted for inflation
Item
FY2020
FY2021
FY2022
FY2023
FY2024
User Fees from FGIS-Conducted Inspections
Revenue
$30.26
$34.86
$31.77
$28.21
$29.45
Obligations
$35.80
$37.81
$35.80
$31.75
$25.69
46 The limitation also permits FGIS to increase costs of administrative and supervisory activities as the costs for FGIS-
conducted inspections and weighing increase, such as when exporters increase the volume of exports directly inspected
by FGIS.
47 FGIS personal communications to CRS, April 30, 2025.
48 Sequestration is the automatic cancellation of previously enacted spending. For background on sequestration, see
CRS Report R42972, Sequestration as a Budget Enforcement Process: Frequently Asked Questions.
49 Office of Management and Budget, OMB Report to the Congress on the BBEDCA 251A Sequestration for Fiscal
Year 2025, March 11, 2024, https://bidenwhitehouse.archives.gov/wp-content/uploads/2024/03/
BBEDCA_251A_Sequestration_Report_FY2025.pdf.
50 7 U.S.C. §79(j)(3).
51 FGIS personal communications to CRS, May 12, 2025.
52 FGIS personal communications to CRS, April 30, 2025. According to FGIS, the nature of the conflict pertains to
restrictions on USGSA user fees that are retained in trust revolving funds. For additional background on trust revolving
funds, see GAO, Revolving Funds: Key Features, GAO-24-107270, January 16, 2024, https://www.gao.gov/assets/gao24-107270.pdf.
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Item
FY2020
FY2021
FY2022
FY2023
FY2024
Net
Earnings/Losses
-$5.54
-$2.96
-$4.04
-$3.54
$3.76
Operating
Reserve
$10.01
$7.07
$3.04
-$0.50
$3.26
3.4
2.2
1.0
-0.2
1.1
Months of
Operating Cost
Equivalent
User Fees from FGIS Supervision of Delegated and Designated Agencies
Revenue
$0.00
$1.69
$0.39
$0.28
$0.95
Obligations
$1.81
$1.37
$1.23
$1.19
$0.97
Net
Earnings/Losses
-$1.81
$0.32
-$0.84
-$0.91
-$0.01
Operating
Reserve
$1.73
$2.04
$1.20
$0.30
$0.28
11
18
12
1
3.5
Months of
Operating Cost
Equivalent
Source: Compiled by CRS from USDA, AMS, FGIS User Fee Accounts data, various years; and USDA, AMS,
“Federal Grain Inspection Service Updates,” presented at the Grain Inspection Advisory Committee meeting,
October 2024, https://www.ams.usda.gov/sites/default/files/media/FGISUpdates_GIACOct2024.pdf.
Notes: FGIS = Federal Grain Inspection Service. Net earnings/losses are calculated as revenue less obligations
and are positive when revenue exceeds obligations and negative when revenue is less than obligations. FGIS
suspended collection of fees for supervision of delegated and designated agencies in calendar years 2016-2020
and 2022. Revenues for FGIS supervision of delegated and designated agencies for FY2022 were collected in
calendar 2021. In FY2023, user fees from direct inspections and operating reserves were insufficient to cover
total obligations for direct inspections, and USDA reallocated FGIS overhead costs to address the funding
shortfall.
FGIS faces various challenges to meeting the statutory requirements on operating reserves. One
challenge is the variability of FGIS user fee revenue in recent years. FGIS user fee revenues (for
direct inspections and supervisory activities) vary from year to year for two reasons. First, user
fees depend on the volume of grain inspected, and the total amount of grain inspected each year
varies annually. Between FY2015 and FY2024, the total amount of grain inspected each year
ranged from a low of 268.7 million metric tons in FY2023 to a high of 349.2 million metric tons
in FY2021 (Figure 1). Large annual changes in the volume of grain inspected by FGIS personnel
can result in large changes in user fee income to fund FGIS activities. A shortfall in the volume of
grain inspected relative to FGIS’s expected levels can result in operating reserves that fall below
the statutory three-month minimum, and a significant increase in the volume of grain inspected
relative to FGIS’s expected levels can result in operating reserves that exceed the statutory sixmonth maximum.
Second, FGIS varies the fees charged for direct inspections and supervisory activities from year
to year in response to FGIS costs and funds available in the operating reserves. In 2016, FGIS
determined that operational reserves exceeded the amount needed for six months of operation for
the direct inspection and supervisory inspection accounts. In response, FGIS reduced the fees
charged for direct inspections each year from FY2017 to FY2019. From July 1, 2016, through
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December 31, 2020, FGIS suspended the collection of fees for supervisory activities.53 Fee
collection for supervisory activities resumed on January 1, 2021. Each year from FY2020 to
FY2024, FGIS increased fees for direct inspections and varied the fees charged for supervisory
activities, including suspending collection of fees for supervisory activities again in 2022.
In 2023, the grain industry reported challenges planning for annual changes in fees.54 In January
2025, USDA published a final rule to establish standardized formulas to calculate hourly and unit
fees.55 FGIS said that the rule will improve transparency in how rates are calculated and mitigate
instances of large rate increases from year to year.
Grain Inspection Advisory Committee
The USGSA requires USDA to establish a GIAC to advise on the act’s implementation.56 The
committee consists of 15 members, each of whom serve 3-year terms. Prior to 2020, GIAC
members were limited to two terms. The 2020 reauthorization act allows members to serve more
than two terms, with a maximum of two in succession.
The membership must represent the interests of grain producers, processors, handlers,
merchandisers, consumers, and exporters and must include grain inspection agencies and
scientists with expertise in grain standards. Participation in the committee is uncompensated,
though members are eligible to receive travel expenses and per diems. Typically, the committee
meets twice a year. USDA’s authority to establish and maintain the committee is set to expire on
September 30, 2025.57
Expiring Provisions of the USGSA
Most of the USGSA is permanently authorized, including the mandatory inspection and weighing
of exported grain, voluntary inspection of domestically marketed grain, and federal authority to
establish and amend grain quality standards. Four provisions of the law are set to expire on
September 30, 2025:
1. Authority for appropriations (7 U.S.C. §87h). FGIS uses appropriated funds to
develop grain standards, improve measurement procedures, and pay for related
agency costs.
2. Authority to collect fees for federal supervision of state agencies’ export
inspections (7 U.S.C. §79(j)(5)) and weighing (7 U.S.C. §79a(l)(4)). FGIS or
official agencies supervised by FGIS perform official inspections and weighing
services. These authorities allow FGIS to charge fees for the required federal
supervision of inspections and weighing performed by designated and delegated
agencies.
53 USDA and Grain Inspection, Packers, and Stockyards Administration (GIPSA), “Suspension of Supervision Fee
Assessment Under the United States Grain Standards Act,” 81 Federal Register 41790, June 28, 2016. The notice of
suspension through December 31, 2020, is found at USDA, AMS, “Notice of Continued Suspension of Supervision Fee
Assessment Under the United States Grain Standards Act (USGSA),” 84 Federal Register 7016, March 1, 2019.
54 USDA, AMS, “FGIS User Fees & Budget,” presented at the Grain Inspection Advisory Committee (GIAC) meeting,
August 2023, https://www.ams.usda.gov/about-ams/giac-aug-2023-meeting/user-fees-budget.
55 USDA, AMS, “Formulas for Calculating Hourly and Unit Fees for FGIS Services,” 90 Federal Register 531, January
6, 2025.
56 7 U.S.C. §87j.
57 7 U.S.C. §87j(e).
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3. Administrative and supervisory cost cap of 30% (7 U.S.C. §79d). The
USGSA limits USDA’s expenditures for administrative and supervisory costs
relative to the total costs of FGIS’s inspections and supervisory activities.
Congress established the cap in 1988 to encourage USDA to reduce costs for the
program. Since 2000, the limit has been set at 30%.
4. Authority for an advisory committee (7 U.S.C. §87j(e)). The GIAC meets
regularly to advise FGIS on the programs and services it delivers and makes
recommendations designed to help the agency better meet its customers’ needs.
If the authority for appropriations were to expire, FGIS grain standards development and
maintenance activities would cease until authorities are restored either through reauthorization or
if Congress were to fund such activities through appropriations.
If the authority to collect fees for supervising delegated and designated agencies were to expire,
FGIS and delegated and designated agencies may be able to carry out official grain inspections
and weighing so long as sufficient operating reserves are available. Delegated and designated
agencies can conduct official grain inspections and weighing only under FGIS’s supervision. In
the event of a lapse in this USGSA authority, FGIS may be able to continue to conduct
supervisory activities to the extent operating funds in the operating reserve would permit. In the
absence of funds for FGIS supervisory activities, FGIS would not be able to charge fees for
supervising inspections and weighing done by delegated and designated agencies. Inspections by
delegated and designated agencies may be curtailed, and exporters may be required to seek
official inspections from FGIS directly, which may require grain exporters to incur additional
costs and/or experience delays in service depending on the availability and location of FGIS
inspectors. FGIS’s authority to collect fees for inspections conducted by its personnel does not
expire. FGIS would be able to conduct direct inspections and weighing services, which accounted
for more than 60% of inspections and weighing of exported grain in FY2024 (Figure 4).
The administrative and supervisory cost cap limit the costs that FGIS can incur for administering
and supervising official grain inspections and weighing. If the statutory cost cap were to expire,
FGIS would be able to expend user fees on these activities regardless of funds expended on direct
costs for FGIS-conducted grain inspections. This may allow FGIS to incur higher administrative
and supervisory costs in certain years when FGIS collects relatively low revenues from direct
inspections and weighing services.
If the authority for the GIAC were to expire, advisory committee activities would cease until
authorities were restored either through reauthorization of the USGSA provisions or if Congress
were to fund such activities through appropriations.
Issues for Congress
Congress enacted the USGSA in 1916 to establish national grain standards and facilitate the
orderly marketing of grain exports. Since 1916, Congress has amended the law numerous times to
address evolving market conditions and policy concerns (see Appendix B). In general, the grain
industry supports the continuation of nationally uniform grades, the availability of official
inspections in the domestic market, and the mandatory application of official weighing and
inspection for exported grain.58 Since the USGSA was last reauthorized in 2020, USDA has made
numerous changes to the grain inspection system to address the user fee calculations, update
58 See, for example, Jess McCluer, “The Role and Reauthorization of the U.S. Grain Standards Act,” Grain Journal,
December 11, 2024, https://www.grainjournal.com/article/1062497/the-role-and-reauthorization-of-the-u.s.-grainstandards-act.
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geographic boundaries of service areas for designated agencies, and improve the transparency of
various aspects of program operations.
Certain USGSA provisions related to program funding and the GIAC are set to expire on
September 30, 2025. Some policy options of potential interest to Congress that typically would be
addressed during USGSA reauthorization debates include the following:
User fees. Since 2015, FGIS has faced challenges in maintaining compliance with statutory
requirements on operating reserves and, as a result, made changes to user fees in some years.
Grain exporters have noted difficulties in managing recent annual increases in user fees. FGIS
published a new rule in 2025 to improve the predictability and transparency of future user fee
updates. Congress could consider additional proposals to further reduce the annual variability of
user fees, including the following:
•
•
•
•
Modify fees based on tonnage for all inspections. Statute requires FGIS to
calculate tonnage fees based on the most recent five-year average of grain
inspected for export. Congress could consider alternative methods of calculating
tonnage fees that might smooth annual variation (e.g., Olympic averaging
tonnage volumes, capping annual changes in tonnage fees). Olympic averaging
would remove the highest and lowest values before calculating the average.
Capping annual changes would restrict the amount that the average could
increase or decrease from year to year. Smoothing the annual variation in the
tonnage rate calculation may improve the predictability of year-to-year changes
in FGIS’s user fees for supervising delegated and designated agencies.
Modify requirements on operating reserves. Congress originally imposed
requirements on operating reserves to ensure that FGIS could continue operations
for at least three months during a lapse in appropriations and would manage fees
to prevent accumulation of excess operating reserves (see Appendix C). Statute
requires FGIS to maintain operating reserves equivalent to between three and six
months of costs. Congress could consider adjusting these requirements to permit
FGIS flexibility to manage program costs and burdens on grain inspection system
participants.
Modify the cap on administrative and supervisory costs. Congress originally
imposed limits on administrative and supervisory costs to encourage FGIS to
control costs. The cap has not restricted operations in recent years, although
FGIS costs approached the cap in 2018 and 2019 because of one-time costs
incurred for upgrading equipment and adopting new technologies. Certain
administrative costs are exempted from the cap (i.e., costs incurred for
standardization, compliance, and foreign monitoring). Some policymakers may
support incentivizing further reductions of administrative costs from current
levels. Congress could consider whether the cap meets current goals for FGIS
cost containment. Other policymakers may support FGIS investments in
upgrading equipment and adopting new technologies. Congress could consider
exempting these costs from the cap.
Modify the limit on use of user fees. Provisions in annual appropriations limit
FGIS’s use of user fees for all purposes (i.e., direct, administrative, and
supervisory costs). Congress could consider adjusting this limit to permit FGIS to
use more of the fee revenue collected for program operations. USDA’s FY2025
budget request proposed to increase the limitation on fee-funded inspections and
weighing and examination services from $55 million to $60 million. In its
FY2025 budget request, USDA said the increase would address the 2024 and
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•
•
•
2025 cost of living adjustments for FGIS staff and fund additional activities. The
National Grain and Feed Association (NGFA) and North American Grain Export
Association (NAGEA) suggested exempting commodities inspected under the
AMA from the limit, which would allow FGIS to use up to $55 million in user
fees from USGSA inspections and an uncapped amount of user fees from AMA
inspections.59
Modify flexibilities for exporters to use alternative service providers. Statute
requires FGIS to assign geographic areas to each designated agency wherein that
area the agency serves as the sole provider of official grain inspections and
weighing services. Congress established this requirement to prevent exporters
from engaging in “grade shopping” and to ensure that designated agencies would
receive sufficient business to fund on-site inspection facilities. Statute permits
FGIS to grant waivers of the geographic area requirement under certain
circumstances. Other circumstances could arise where a grain exporter might
wish to use an alternative vendor (e.g., a business dispute with its assigned
agency or an alternative vendor add-on service beyond the official inspection and
weighing service that is not available from the assigned agency). Congress could
consider maintaining the existing waiver system, expanding FGIS’s authorities to
grant waivers and/or allowing exporters to request services directly from FGIS in
certain circumstances, or reducing FGIS’s authorities to grant waivers. Increasing
the circumstances in which USDA is allowed to grant waivers may increase
incentives for buyers and sellers to seek official inspections for domestically
marketed grain and reduce delegated and designated agencies’ financial
incentives for participating in the program. Reducing the circumstances in which
USDA is allowed to grant waivers may decrease incentives for voluntary grain
inspections and increase state and private sector agencies’ incentives to become a
delegated and/or designated agency.
Clarify rules on investment of operating reserves. Legal opinions may differ
on the existing statutory permissions to invest operating reserves. Interest
collected on operating reserves could provide additional revenues for use in
program operations and/or could be returned to the U.S. Treasury for other
purposes. Congress could consider revising the USGSA to eliminate any
perceived conflicts with provisions allowing for investment of operating reserves
in interest-bearing accounts.
Consider public investments in grain grading technologies. Congress funds
the development and maintenance of grain standards through annual
appropriations as a public good to benefit the entire grain industry. Investments
in commercialization of new grain grading technologies are typically funded by
the private sector. NGFA and NAGEA have proposed that FGIS annual
appropriations be used to fund investments in new grain grading technologies.60
Historically, FGIS has engaged in limited partnerships with USDA’s Agricultural
Research Service (ARS) to support commercialization of specific new grading
technologies developed by ARS. Congress could consider establishing conditions
for FGIS support of new grain grading technologies. Expanding FGIS’s support
of such technologies may require additional budgetary resources.
59 McCluer, “The Role and Reauthorization of the U.S. Grain Standards Act.”
60 McCluer, “The Role and Reauthorization of the U.S. Grain Standards Act.”
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Appendix A. References for the U.S. Grain
Standards Act
Table A-1. U.S. Grain Standards Act (USGSA), Regulations and Other Information
Item
Reference
Link
Compilation, as amended through P.L.
116-216, September 30, 2020
http://www.ag.senate.gov/download/unitedstates-grain-standards-act
P.L. 116-216 (USGSA reauthorization
in 2020)
https://www.govinfo.gov/content/pkg/PLAW116publ216/pdf/PLAW-116publ216.pdf
Codification
7 U.S.C. §§71 et seq.
http://uscode.house.gov/view.xhtml?path=/
prelim@title7/chapter3&edition=prelim
Regulations
7 C.F.R. §800 - General regulations
http://www.ecfr.gov/cgi-bin/text-idx?c=ecfr&
SID=89728873dd6db7cbd4920c182863a5a1&
tpl=/ecfrbrowse/Title07/7cfr800_main_02.tpl
7 C.F.R. §801 - Official performance
requirements for grain inspection
equipment
http://www.ecfr.gov/cgi-bin/text-idx?c=ecfr&
SID=89728873dd6db7cbd4920c182863a5a1&
tpl=/ecfrbrowse/Title07/7cfr801_main_02.tpl
7 C.F.R. §802 - Official performance
and procedural requirements for grain
weighing equipment and related grain
handling systems
http://www.ecfr.gov/cgi-bin/text-idx?c=ecfr&
SID=89728873dd6db7cbd4920c182863a5a1&
tpl=/ecfrbrowse/Title07/7cfr802_main_02.tpl
7 C.F.R. §810 - Official United States
standards for grain
http://www.ecfr.gov/cgi-bin/text-idx?c=ecfr&
SID=89728873dd6db7cbd4920c182863a5a1&
tpl=/ecfrbrowse/Title07/7cfr810_main_02.tpl
Historical standards
Historical compilation of standards
changes
https://www.ams.usda.gov/sites/default/files/
media/GrainHistory.pdf
Official service
providers
List of providers that comprise the
official grain inspection and weighing
system
https://fgisonline.ams.usda.gov/MyFGIS/
OSPDirectory
Fee schedule
Fees charged for required and
optional inspections and weighing
services, updated October 2024
https://www.ams.usda.gov/sites/default/files/
media/FGISDirective9180_74.pdf
FGIS information
Agency reports and publications,
including annual reports, grain export
quality reports, and directories and
technical handbooks, brochures, and
procedure references
https://www.ams.usda.gov/services/grain-ricepulse-inspection-services
Statute
Source: CRS.
Note: FGIS = Federal Grain Inspection Service.
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Appendix B. U.S. Grain Standards Act Legislative
History
Table B-1. USGSA Legislative History and Selected Provisions
Date
Statute
Public Law
Selected Provisions
Aug. 11,
1916
39 Stat.
482
P.L. 64-190—United
States Grain Standards
Act (USGSA)
Authorized the Secretary of Agriculture to investigate grading of grain
and establish standards of quality for corn, wheat, rye, oats, barley,
and flaxseed. If sold by grade, prohibited interstate or foreign
shipment unless inspected. Directed USDA to issue licenses to state
inspectors and private inspection agencies and supervise their
activities.
Jul. 18,
1940
54 Stat.
765
P.L. 76-750—USGSA,
amendment
Added soybeans to list of commodities.
Aug. 1,
1956
70 Stat.
780
P.L. 84-861—USGSA,
amendment
Prohibited issuance of false certificates.
Jul. 11,
1958
72 Stat.
352
P.L. 85-509—USGSA,
amendment
Authorized USDA to recover the cost of overtime from performing
appeal inspection services.
Aug. 15,
1968
82 Stat.
761
P.L. 90-487—USGSA
Removed requirement for inspecting interstate shipments if sold by
grade; greater penalties for violations.
Oct. 21,
1976
90 Stat.
2867
P.L. 94-582—USGSA of
1976
Established the Federal Grain Inspection Service (FGIS); authorized
the FGIS administrator to set grain standards; established official
weighing services; required elevator recordkeeping and exporter
registration; authorized direct FGIS inspections for exports; required
user fees for federal supervision of inspections and weighing services.
Sept. 29,
1977
91 Stat.
1024
P.L. 95-113—USGSA,
amendment; Title XVI of
the Food and Ag. Act of
1977 (1977 farm bill)
Supervisory costs to be paid via appropriations only. Established a
temporary advisory committee and reduced recordkeeping burden
for users.
Oct. 13,
1980
94 Stat.
1870
P.L. 96-437—USGSA,
amendment (Dole-Ashley
bill)
Permitted grain to be delivered into or out of export elevators
without official weighing if conveyed by means other than barge.
Aug. 13,
1981
95 Stat.
357
P.L. 97-35—Omnibus
Budget Reconciliation
Act of 1981
Revised the system covering inspection and supervision fees; limited
the administrative and supervisory costs to a maximum of 35% of
total costs; established a permanent advisory committee; specified
authorization for appropriations for FY1982 through FY1984.
Dec. 22,
1981
95 Stat.
1268
P.L. 97-98—Agricultural
Food Act (1981 farm bill)
Permitted state agency authority for grain inspection at export port
locations if operating prior to July 1, 1976.
Oct. 11,
1984
98 Stat.
1831
P.L. 98-469—Omnibus
Budget Reconciliation
Act of 1981, amendment
Extended the authorization for appropriations through September
1988. Increased the cap on administrative and supervisory costs from
35% to 40% for FY1985 through FY1988.
Dec. 23,
1985
99 Stat.
1632
P.L. 99-198—Food
Security Act of 1985
(1985 farm bill)
Directed FGIS and the Agricultural Research Service to cooperate in
developing new means of establishing grain classifications. Required a
study by the Office of Technology Assessment on grain export
standards, blending practices, and export competitiveness.
Nov. 10,
1986
100 Stat.
3564
P.L. 99-641—Futures
Trading Act of 1986,
Title III-Grain Quality
Improvement Act of
1986
Prohibited the reintroduction of foreign material (including dust) once
removed from grain; required a study of incentives for high quality
and a feasibility test for determining the value of end-use
characteristics.
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Date
Statute
Public Law
Selected Provisions
Oct. 24,
1988
102 Stat.
2584
P.L. 100-518—USGSA
Amendments of 1988
Extended the authorization for appropriations for FY1989 through
FY1993; expanded the advisory committee from 12 to 15 members;
mandated a study on dockage in wheat grades; established a pilot
program on incorporating premiums for superior quality grain
delivered to the Commodity Credit Corporation.
Nov. 28,
1990
104 Stat.
3928
P.L. 101-624—Food,
Agriculture,
Conservation, and Trade
Act of 1990 (1990 farm
bill), Title XX- Grain
Quality Incentives Act of
1990
Established a Committee on Grain Quality at USDA to evaluate
concerns with quality of U.S. grain; established provisions for
improving the cleanliness of grain through existing standards and
additional prohibitions on grain contamination; directed FGIS to test
all exported corn for aflatoxin contamination.
Nov. 24,
1993
107 Stat.
1525
P.L. 103-156—USGSA
Amendments of 1993
Extended the authorization of appropriations for grain inspection
services and collection of user fees for FY1994 through FY2000;
authorized inspections and weighing activities in Canadian ports;
authorized a pilot program to permit more than one official agency to
carry out inspections within a single geographic area; directed USDA
to carry out a cost containment plan to minimize taxpayer
expenditures and user fees.
Oct. 13,
1994
108 Stat.
3237
P.L. 103-354—Federal
Crop Insurance Reform
and Department of
Agriculture
Reorganization Act of
1994, USGSA
Amendments of 1994
Removed authorities from the FGIS administrator and granted them
to the Secretary of Agriculture. Authorized the Secretary of
Agriculture to consolidate administrative units, including FGIS.
Nov. 9,
2000
114 Stat.
2058
P.L. 106-472—Grain
Standards and
Warehouse
Improvement Act of
2000
Reauthorized the pilot program to allow more than one designated
official agency to carry out inspections and weighing services within
the same geographic area under certain conditions. Reduced the
limitation on administrative and supervisory costs in user fees from
40% to 30%; prohibited the disguising of grain quality; extended from
FY2001 through FY2005 the authorization of appropriations for grain
inspection services, collection of certain user fees, and authority for
an advisory committee.
Sept. 30,
2005
119 Stat.
2053
P.L. 109-83—USGSA,
amendment
Extended expiring provisions from FY2006 through FY2015.
Sept. 30,
2015
129 Stat.
513
P.L. 114-54—Agriculture
Reauthorizations Act of
2015, Title III
Extended expiring provisions from FY2016 through FY2020. Also,
included provisions addressing disruptions of inspections and weighing
services, certifying state agencies, and setting conditions for allowing
designated agencies to cross geographic boundaries.
Dec. 20,
2018
132 Stat.
4490
P.L. 115-334—
Agriculture Improvement
Act of 2018, Sec. 12610
Expanded conditions for allowing designated agencies to cross
geographic boundaries.
Dec. 11,
2022
134 Stat.
1048
P.L. 116-216—United
States Grain Standards
Reauthorization Act of
2020
Extended expiring provisions from FY2021 through FY2025. Also,
included provisions addressing discontinuance of services, reporting
requirements, funding from appropriations and user fees, the advisory
committee, and the geographic boundaries of service zones for
inspection facilities.
Source: Compiled by CRS using statutes and Lowell D. Hill, Grain Grades and Standards—Historical Issues Shaping
the Future (University of Illinois Press, 1990).
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Appendix C. U.S. Grain Standards Act Through the
Years
Today’s U.S. grain inspection system dates back to over 100 years ago when numerous states and
trade organizations were inspecting grain for quality at inspection points across the country, often
with widely different standards and terminology. The lack of accepted grain standards and
inspection procedures contributed to chaotic marketing conditions and inefficient marketing.
Disputes arose between producers, traders, and buyers with charges of poor quality and unfair
practices.61
Following unsuccessful attempts by the industry to adopt voluntary grain standards, the U.S.
Grain Standards Act (USGSA) was enacted on August 11, 1916, to “prevent or eliminate burdens
on” interstate or foreign commerce.62 The first established standard was for corn and became
effective on December 1, 1916. The act required official inspection of certain export and
interstate shipments of grain sold by grade and directed USDA to issue licenses to state inspectors
and private inspection agencies and supervise their activities. Only licensed inspectors could issue
official grade certificates.
Legislative History: First 60 Years
Congress has amended the USGSA 21 times since enactment (see Table B-1). The first change
came in 1940 when soybeans were included. In 1956, it was amended to prohibit issuance of false
certificates by the deceptive loading, handling, or sampling of grain. In 1958, an amendment
authorized USDA to recover the cost of overtime resulting from performing appeal inspections.
Another revision came in 1968, when Congress eliminated the inspection requirement for
interstate grain shipments sold by grade. The requirement for domestic grain reportedly created
inefficiencies in grain movements and added costs by requiring inspections regardless of whether
buyer or seller wanted an official grade.63 Other provisions extended lead times to initiate changes
in standards from 90 days to 1 year and increased penalties for violations of the act.
In the mid-1970s, investigations revealed grain misgrading, “short” weighing, bribery, and other
irregularities in grain inspections and weighing services, threatening the credibility of the U.S.
grain inspection system. Between 1974 and 1976, 124 federal grand jury indictments were issued
against 94 individuals and 14 firms; according to USDA, as of 1977, 93 individuals and all firms
had been convicted.64
In February 1976, the General Accounting Office65 reported that USDA was unable to ensure the
integrity of the grain inspection system operated by a widely dispersed group of over 100 state
and private agencies. The office also noted that the system generally operated without effective
61 See USDA, The Federal Grain Inspection Service (FGIS), Annual Report to Congress, November 1977, pp. 7-8,
accessed on May 21, 2025, through the web archive at https://web.archive.org/web/20150906002022/http://
www.gipsa.usda.gov/fgis/publication/ar/1977_fgis_AR.pdf; and Lowell D. Hill, Grain Grades and Standards—
Historical Issues Shaping the Future (University of Illinois Press, 1990). This appendix draws primarily from these
sources. Where other sources are used, they are specifically footnoted.
62 7 U.S.C. §74.
63 Lowell D. Hill, Grain Grades and Standards—Historical Issues Shaping the Future (University of Illinois Press,
1990).
64 USDA, The Federal Grain Inspection Service (FGIS), Annual Report to Congress, November 1977, p. 9.
65 The General Accounting Office was renamed the Government Accountability Office in 2004.
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controls, tolerated conflicts of interest, and did not respond to the limited supervision of the
Agricultural Marketing Service.66
In response to the reported criminal activity and investigations, Congress passed the U.S. Grain
Standards Act of 1976 (P.L. 94-582), which amended the USGSA to establish official weighing
services, recordkeeping by elevators, registration of grain exporters, and user fees to address
federal supervision costs. The 1976 law established the Federal Grain Inspection Service (FGIS)
and required either federal inspection or state agency inspections for exported grains. Previous
law had required either state agency or private agency inspections but had not authorized federal
inspections. The 1976 law moved authority for setting grain standards from the Secretary of
Agriculture to the FGIS administrator. The 1976 law included provisions restricting grain
companies and boards of trade (commodity exchanges) from sponsoring inspection agencies,
which had created conflicts of interest.
Focus on Funding, the Advisory Committee, and Quality in the
1980s and 1990s
In the late 1970s and early 1980s, legislation focused on funding and advisory issues, including a
repeal and then reinstatement of user fees, establishment of an industry advisory committee,
elimination of the requirement for official weighing except for exports, and limits on
administrative and supervisory costs in user fees. The Omnibus Budget Reconciliation Act of
1981 (P.L. 97-35) provided the authorization of appropriations for a specified period of time (i.e.,
FY1981 through FY1984). Prior to 1981, Congress had not specified an expiration date for the
authorizations of appropriations. Subsequent reauthorizations of the USGSA extended this
authority for periods of 4, 5, 7, or 10 years.
Beginning in the mid-1980s, congressional focus shifted to grain quality. The 1985 farm bill (P.L.
99-198) required a study on grain export standards and blending practices. In 1986, measures
were enacted to prohibit reintroduction of foreign material (including dust) removed from grain.
The quality emphasis continued in the 1990 farm bill (P.L. 101-624), which established a grain
quality committee within USDA and provisions for improving cleanliness of grain through
existing standards and additional prohibitions on contamination.
Cost Containment in the 1990s and Early 2000s
In 1993, Congress enacted the U.S. Grain Standards Act Amendments of 1993 (P.L. 103-156),
which extended the authorization of appropriations for grain inspection services and collection of
user fees through FY2000, authorized inspections and weighing activities in Canadian ports, and
authorized a pilot program to permit more than one official agency to carry out inspections within
a single geographic area. Congress also directed USDA to develop and carry out a comprehensive
cost containment plan to minimize expenditures and user fees.
In 2000, the Grain Standards and Warehouse Improvement Act of 2000 (P.L. 106-472)
reauthorized the pilot program allowing more than one designated official agency to carry out
inspections and weighing services within the same geographic area under certain conditions. It
also reduced the limitation on administrative and supervisory costs in user fees from 40% to 30%
and prohibited disguising of grain quality. Congress also extended through FY2005 the
66 General Accounting Office, Report of the Comptroller General of the United States: Assessment of the National
Grain Inspection System, February 12, 1976, p. i.
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authorization of appropriations for grain inspection services, collection of certain user fees, and
authority for an advisory committee.
In the 2005, the USGSA reauthorization amendment (P.L. 109-83) extended the respective end
dates through FY2015 for the four provisions set to expire. Prior to reauthorization, Congress
considered giving USDA authority to contract export inspections and weighing services to private
companies (with federal oversight) to reduce federal staff costs, but USDA determined it already
had that authority.67
Reforms in 2015-2020
Between 2015 and 2020, Congress amended the USGSA three times, in the Agriculture
Reauthorizations Act of 2015 (2015 reauthorization act; P.L. 114-54), the Agriculture
Improvement Act of 2018 (2018 farm bill; P.L. 115-334), and the U.S. Grain Standards
Reauthorization Act of 2020 (2020 reauthorization act; P.L. 116-216). These amendments
addressed policy issues on (1) interruption in service and continuity of operations, (2)
geographical boundaries for official agencies, (3) duration of official agency designations, (4) the
approval process for delegated state agencies, and (5) fee calculations. In some instances, these
policy issues were addressed in multiple acts.
Interruptions of Inspection Service
In 2013-2014, grain inspections were disrupted at the Port of Vancouver (WA) when labor
negotiations between United Grain Corporation (UGC) and the International Longshore and
Warehouse Union (ILWU) reached an impasse, and UGC locked out the union workers. Picketing
at the UGC facility raised concerns about the safety of the UGC employees and grain inspectors
who were employees of the Washington State Department of Agriculture (WSDA).68 In July
2014, WSDA stopped official inspections and requested inspection assistance from USDA and
federal inspectors. As reported, USDA determined that conditions did not allow state or federal
inspectors safe access to conduct grain inspections.69 About five weeks after inspections were
halted, WSDA resumed official inspections and weighing services after a labor agreement was
reached. The dispute was resolved the night before the plan to start federal inspections was to go
into place.
The 2015 reauthorization act amended the USGSA to require USDA to take immediate action to
address disruption of inspections and weighing services and to subsequently resume activities.
Within 24 hours of a disruption, USDA is required to submit a report to Congress describing the
disruption and the actions needed to address it. USDA is required to send Congress daily update
reports until inspections and weighing services are resumed.70
In addition, the 2015 reauthorization act required any state agency that decides to temporarily
suspend inspections and weighing services to provide USDA advance notice of at least 72 hours
ahead of discontinuing services.71 The 2020 reauthorization act requires state agencies to also
67 Sen. Saxby Chambliss, “U.S. Grain Standards Act,” remarks in the Senate, Congressional Record, daily edition, vol.
151, no. 123 (September 28, 2005), p. S10583.
68 The Washington State Department of Agriculture is the official delegated agency to provide inspections and
weighing services for the Port of Vancouver.
69 See, for example, Aaron Corvin, “Port of Vancouver Faulted in Grain-Inspection Dispute,” The Columbian, August
7, 2014, https://www.columbian.com/news/2014/aug/07/port-vancouver-faulted-grain-inspection-dispute/.
70 P.L. 114-54, §301(a).
71 P.L. 114-54, §301(b).
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notify affected customers. The requirement does not extend to disruptions caused by major
disasters.
The 2015 reauthorization act also directed USDA to issue a report to Congress on the disruption
at the Port of Vancouver and describe policy changes that would be implemented in the case of a
similar disruption. USDA released the report in February 2016 and outlined policies that focused
on communications between parties to a labor dispute, state and local government, and law
enforcement. In the report, USDA noted that FGIS-conducted inspections in Portland, OR, where
a similar labor dispute was taking place between the Columbia Grain Company and the ILWU,
were mostly unimpeded by the labor dispute. USDA attributed the continuity of inspections to
communications between the disputing parties, FGIS, and the Portland police to prevent
disruptive incidents.72
Geographical Boundaries for Official Agencies
Each official agency covers a specific and exclusive geographic area, which is authorized by the
USGSA. Exclusivity is granted to ensure the economic viability of inspections and weighing
services (see “U.S. Grain Inspection System”). Prior to 2015, the USGSA granted USDA
discretionary authority to conduct pilot programs that allowed for multiple designated agencies
within the same geographic area and exceptions to geographic areas exclusivity for lack of timely
service, prior nonuse of service, and barge probe sampling and inspection. The 2015
reauthorization act removed USDA’s authority to conduct the pilot programs and required USDA
to grant exceptions for three causes: (1) lack of timely service; (2) barge probe sampling and
inspection; and (3) when the official agency agrees in writing to waive the restriction in favor of
inspections and weighing services by an adjacent official agency.
The 2015 reauthorization act removed USDA’s authority to grant waivers for prior nonuse of
service. As a result, USDA revoked waivers previously granted for that reason. In response to
feedback from the industry, Congress restored USDA’s ability to grant waivers to geographic area
exclusivity based on prior nonuse of service in the 2018 farm bill and required USDA to conduct
a comprehensive review of official agency geographic areas in the 2020 reauthorization act.
Duration of Designation Authority
Under the USGSA, USDA delegates authority to states and private entities to provide official
inspection and/or weighing services on behalf of the federal government. Prior to 2015, the period
for “official agency designation” was three years. The final 2015 reauthorization act changed the
period of designation from three to five years.73
Approval Process for Delegated State Agencies
During the 2015 reauthorization debate, grain industry associations advocated for more openness
in the USDA process of approving a delegated state agency (for export inspections).74 The
72 USDA, GIPSA, Report to Congress on the Disruption in Federal Inspection of Grain Exports at the Port of
Vancouver in the Summer of 2014 as required by Title III of the United States Grain Standards Act Reauthorization,
Section 301, February 29, 2016.
73 7 U.S.C. §79(e)(2)(B)(i).
74 Testimony of Nick Friant, food safety leader, Cargill Inc., on behalf of National Grain and Feed Association (NGFA)
and North American Export Grain Association (NAEGA), in U.S. Congress, House Committee on Agriculture,
Subcommittee on General Farm Commodities and Risk Management, Hearing to Review Reauthorization of the U.S.
Grain Standards Act, 114th Cong., 1st sess., April 22, 2015, H.Hrg. 114-11, p. 14 (hereinafter Friant, Testimony in
House, April 22, 2015).
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associations believed the process did not provide for a periodic and public review of state
inspection agencies and wanted FGIS to adopt the approach used for approving agencies for
domestic inspection that includes a Federal Register notice and comment period. The 2015
reauthorization act required USDA to establish, within one year of enactment, a certification
process for delegating authority to state agencies that includes a Federal Register notice and
comment period. Since enactment, USDA has published Federal Register notices detailing the
review and certification process for all delegated agencies.
Fee Changes and the User Fee Trust Fund
Grain exporters pay inspection and weighing fees to cover USDA’s costs to perform these
services. Part of the fees that USDA charges are based on the volume of grain that is inspected
and weighed. With reduced levels of grain volume in FY2012 and FY2013 due to droughtreduced crops in 2012, fee revenue did not keep pace with costs, resulting in a negative balance in
the user fee trust fund for the export inspection and weighing program in FY2013. In 2013, amid
broad industry support to maintain inspection services, USDA increased fees to ensure full
funding of official inspections and weighing services in future years.75 With a rebound in grain
volumes and higher fees assessed, FGIS fee revenues increased substantially in FY2014, resulting
in a positive trust fund balance.
During the 2015 reauthorization debate, the grain inspection advisory committee recommended
suspending further increases in export grain inspection and weighing fees while FGIS retained
earnings (fee revenue minus obligations) exceeding the agency’s three-month reserve levels.76
Additionally, the National Grain and Feed Association and the NAEGA advocated for tonnage
fees based on a flexible calculation that would result in fees that are more accurate and prevent an
excessive buildup in the trust fund.77 The 2015 final reauthorization act specified that export
tonnage fees be based on a five-year rolling average of export tonnage volume.78 The 2015
reauthorization also directed USDA is to maintain a three- to six-month operating reserve and
adjust fees annually to maintain the reserve.79
USDA’s FY2021 budget request noted that it was using administrative authorities to increase fees
for grain inspection to provide additional revenues to the U.S. Treasury and offset government
spending. USDA proposed to increase user fees to provide $190 million over 10 years. During the
2020 reauthorization debate, the grain industry argued against user fees being used to finance
activities other than official grain inspections and weighing conducted or supervised by FGIS.80
The industry also reaffirmed support for using appropriated funds to cover the costs of FGIS
standards development and maintenance; it argued that these activities were beneficial to the
grain industry as a whole, not only the businesses using official inspections and weighing
75 USDA did not receive any comments opposing the proposed rule. See USDA, GIPSA, “Fees for Official Inspection
and Official Weighing Services Under the United States Grain Standards Act (USGSA),” 78 Federal Register 2215122166, April 15, 2013.
76 USDA, AMS, GIAC Summary of Meeting, November 4-5, 2014, p. 8, accessed on May 21, 2025, through the web
archive at https://web.archive.org/web/20170126165149/https://www.gipsa.usda.gov/fgis/advcommittee/Nov2014/
November-2014.pdf.
77 Friant, Testimony in House, April 22, 2015, pp. 15-16.
78 7 U.S.C. §79(j)(1)(D) and 7 U.S.C. §79a(l)(1)(D).
79 7 U.S.C. §79(j)(4) and 7 U.S.C. §79a(l)(3).
80 U.S. Congress, Senate Committee on Agriculture, Nutrition, and Forestry, Perspective on Reauthorization of the U.S.
Grain Standards Act, hearing, 116th Cong., 1st sess., July 24, 2019. Witnesses included representatives from the
National Association of Wheat Growers, NGFA, NAEGA, and American Association Grain Inspection and Weighing
Agencies.
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services. The 2020 reauthorization act prohibits FGIS from using user fees for developing or
maintaining grain standards or for other activities not directly related to official inspections and
weighing services. The act maintained the use of appropriated funds to support FGIS standards
development and maintenance activities, authorizing annual appropriations of $23 million per
year in lieu of the previous authorization for “such sums as are necessary.”
Author Information
Stephanie Rosch
Analyst in Agricultural Policy
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