Grading and Inspection, General Specifications for Approved Plants and Standards for Grades of Dairy Products; Proposed Increase in Fees

SUMMARY: The Agricultural Marketing Service proposes to increase the

fees charged for services provided under the dairy inspection and

grading program. The program is a voluntary, user-fee program conducted

under the authority of the Agricultural Marketing Act of 1946, as

amended. The proposed increases would result in a fee of $43.00 per

hour for continuous resident services and $48.00 per hour for

nonresident services between the hours of 6:00 a.m. and 6:00 p.m. The

fee for nonresident services between the hours of 6:00 p.m. and 6:00

a.m. would be $52.80 per hour. These proposed fees represent an

increase of 80 cents per hour.

The fees are being increased to cover the costs of recent salary

increases and locality adjustments, the full funding for

standardization activities, and normal inflationary pressures.

DATES: Comments should be mailed by September 6, 1995.

ADDRESSES: Comments should be sent to: Office of the Director, USDA/

AMS/Dairy Division, Room 2968-S, P.O. Box 96456, Washington, D.C.

20090-6456. Comments received will be available for public inspection

at this location during regular business hours.

FOR FURTHER INFORMATION CONTACT: Lynn G. Boerger, USDA/AMS/Dairy

Division, Dairy Grading Branch, Room 2750-South Building, P.O. Box

96456, Washington, D.C. 20090-6456, (202)720-9381.

SUPPLEMENTARY INFORMATION: This rule has been determined not

significant for purposes of Executive Order 12866, and has been

reviewed by the Office of Management and Budget.

This proposed rule has been reviewed under Executive Order 12778,

Civil Justice Reform. This rule is not intended to have preemptive

effect with respect to any State or local laws, regulations or

policies. This rule is not intended to have retroactive effect. There

are no administrative procedures which must be exhausted prior to any

judicial challenge to this rule or the application of its provisions.

The proposed rule also has been reviewed in accordance with the

Regulatory Flexibility Act, 5 U.S.C. 601 et seq., and the

Administrator, Agricultural Marketing Service, has determined that the

proposed rule, if promulgated, would not have a significant economic

impact on a substantial number of small entities. The proposed changes

will not significantly affect the cost per unit for grading and

inspection services. The Agricultural Marketing Service estimates that

overall this rule will yield an additional $87,000 during fiscal year

1996. The Agency does not believe the increases will affect

competition. Furthermore, the dairy grading program is a voluntary

program.

The Agricultural Marketing Act of 1946, as amended, authorizes the

Secretary of Agriculture to provide Federal dairy grading and

inspection services that facilitate marketing and help consumers obtain

the quality of dairy products they desire. The Act provides that

reasonable fees be collected from the users of the services to cover,

as nearly as practicable, the cost of maintaining the program.

Since the costs of the grading program are covered entirely by user

fees, it is essential that fees be increased when necessary to cover

the cost of maintaining a financially self-supporting program. The last

fee increase under this program became effective on February 9, 1994.

Since that time, Congress increased the salaries of Federal employees

by 2.6 percent as of January 8, 1995, which included locality pay.

Also, there have been normal increases in other operating costs. In

addition, recent congressional action may result in additional salary

increases of 2.4 percent in 1996. Although the program's operating

reserves were adequate to cover the January 8, 1995, salary increase,

this will not be the case for 1996 salary increases, and a fee increase

is needed.

The grading program fees also need to be increased to cover the

remaining costs related to the development of dairy product standards

and other activities now performed by the Dairy Division's

Standardization Branch. In FY 1994 Congress appropriated money for the

development of standards by the Agricultural Marketing Service but at

the same time stipulated that the program costs be recovered through

user fees, with the fees being turned over to the U.S. Treasury. The

fee increase which took effect on February 9, 1994, provided for \2/3\

of the cost of that program. Since the dairy standardization program is

an essential part of the dairy grading program, it is appropriate that

all of the standardization program costs be recovered through the fees

charged the users of the grading program. The projected cost of the

dairy standardization program for FY 1996 is $440,000.

Proposed Changes

This rule proposes the following changes in the regulations

implementing the dairy inspection and grading program:

1. Increase the hourly fee for nonresident services from $47.20 to

$48.00 for services performed between 6:00 a.m. and 6:00 p.m. The

nonresident hourly rate is charged to users who request an inspector or

grader for particular dates and amounts of time to perform specific

grading and inspection activities. These users of nonresident services

are charged for the amount of time required to perform the task and

undertake related travel plus travel costs.

2. Increase the hourly fee for continuous resident services from

$42.20 to $43.00. The resident hourly rate is charged to those who are

using grading and inspection services performed by an inspector or

grader assigned to a plant on a continuous, year-round resident basis.

Timing of Fee Increase

It is contemplated that the proposed fee increases would be

implemented on

[[Page 40116]]

an expedited basis in order to minimize the period of revenue

shortfall. Accordingly, it is anticipated that the fee increases, if

adopted, would become effective upon publication, or very soon after

publication, of the final rule in the Federal Register and that

delaying the effective date of the final rule until 30 days after

publication in the Federal Register would not occur. An approximate

effective date would be October 1, 1996.

All written submissions made pursuant to this notice will be made

available for public inspection in the Dairy Division during regular

business hours.

List of Subjects in 7 CFR Part 58

Dairy products, Food grades and standards, Food labeling, Reporting

and recordkeeping requirements.

For the reasons set forth in the preamble, it is proposed that 7

CFR Part 58 be amended as follows:

PART 58--GRADING AND INSPECTION, GENERAL SPECIFICATIONS FOR

APPROVED PLANTS AND STANDARDS FOR GRADES OF DAIRY PRODUCTS

1. The authority citation for part 58 is revised to read as

follows:

Authority: 7 U.S.C. 1621-1627.

Subpart A--[Amended]

2. Section 58.43 is revised to read as follows:

Sec. 58.43 Fees for inspection, grading, and sampling.

Except as otherwise provided in Secs. 58.38 through 58.46, charges

shall be made for inspection, grading, and sampling service at the

hourly rate of $48.00 for service performed between 6:00 a.m. and 6:00

p.m. and $52.80 for service performed between 6:00 p.m. and 6:00 a.m.,

for the time required to perform the service calculated to the nearest

15-minute period, including the time required for preparation of

certificates and reports and the travel time of the inspector or grader

in connection with the performance of the service. A minimum charge of

one-half hour shall be made for service pursuant to each request or

certificate issued.

3. Section 58.45 is revised to read as follows:

Sec. 58.45 Fees for continuous resident services.

Irrespective of the fees and charges provided in Secs. 58.39 and

58.43, charges for the inspector(s) and grader(s) assigned to a

continuous resident program shall be made at the rate of $43.00 per

hour for services performed during the assigned tour of duty. Charges

for service performed in excess of the assigned tour of duty shall be

made at a rate of 1\1/2\ times the rate stated in this section.

Dated: July 31, 1995.

Lon Hatamiya,

Administrator.

[FR Doc. 95-19331 Filed 8-4-95; 8:45 am]

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