Fresh Fruits, Vegetables and Other Products (Inspection, Certification, and Standards)

SUMMARY: This document would revise the regulations governing

inspection and certification for fresh fruits, vegetables and other

products by increasing the fees charged for the inspection of these

products at destination markets. These revisions are necessary in order

to recover, as nearly as practicable, the costs of performing

inspection services at destination markets under the Agricultural

Marketing Act of 1946.

DATES: Comments must be postmarked or courier dated on or before July

15, 1996.

ADDRESSES: Interested persons are invited to submit written comments

concerning this proposal. Comments must be sent in duplicate to the

Office of the Branch Chief, Fresh Products Branch, Fruit and Vegetable

Division, Agricultural Marketing Service, U.S. Department of

Agriculture, P.O. Box 96456, Room 2049 South Building, Washington, DC

20090-6456. Comments should note the date and page number of this issue

of the Federal Register and will be made available for public

inspection in the office of the Branch Chief during regular business

hours.

FOR FURTHER INFORMATION CONTACT: Robert J. Huttenlocker, at the above

address or call, (202) 720-0297.

SUPPLEMENTARY INFORMATION: This proposed rule has been determined to be

not significant for purposes of Executive Order 12866, and therefore

has not been reviewed by the Office of Management and Budget.

This proposed rule has been reviewed under Executive Order 12778,

Civil Justice Reform. This action is not intended to have retroactive

effect. This rule will not preempt any State or local laws,

regulations, or policies, unless they present an irreconcilable

conflict with this rule. There are no administrative procedures which

must be exhausted prior to any judicial challenge to the provisions of

this rule.

The Agricultural Marketing Service (AMS), has certified that this

action will not have a significant impact on a substantial number of

small entities, as defined in the Regulatory Flexibility Act, (5 U.S.C.

601). The proposed rule reflects certain fee increases needed to

recover the costs of inspection services rendered in accordance with

the Agricultural Marketing Act (AMA) of 1946.

The AMA authorizes official inspection, grading, and certification

on a user-fee basis, of fresh fruits, vegetables, and other products

such as raw nuts, Christmas trees, and flowers. The AMA provides that

reasonable fees be collected from the user of the program services to

cover, as nearly as practicable, the costs of services rendered. This

proposal would amend the schedule for fees and charges for inspection

services rendered to the fresh fruit and vegetable industry to reflect

the costs currently associated with the program.

AMS regularly reviews these programs to determine if fees are

adequate. Employee salaries and benefits are major program costs that

account for approximately 86 percent of the total operating budget. A

general and locality salary increase for Federal employees, ranging

from 3.09 to 6.25 percent depending on locality, effective January

1995, has materially affected program costs. Another general and

locality salary increase, ranging from 2.39 to 2.87 percent depending

upon locality (amounting to approximately $253,000), was effective

January 1996; further standardization program costs must be paid for by

user fees.

While a concerted effort to cut costs resulted in overhead savings

of $350,000 in FY 95 over FY 94, the last fee increase of June 1994 did

not result in collection of enough revenue to cover all these increases

and still maintain an adequate reserve balance (four months of costs)

called for by Agency policy (AMS Directive 407.1) and prudent financial

management. Currently the Fresh Products Branch (FPB) trust fund

reserve balance for the market program is approximately $1 mil. under

the desired level of $3.9 mil. Further action is necessary to meet

rising costs and maintain adequate reserve balances. This action will

assist in moving the FPB trust fund toward a more adequate level and

will result in an estimated $614,000 in additional revenues. Projected

FY96 revenues for market inspection are $12.555 mil with costs

projected at $11.594 mil and a reserve of $3.093.

Based on the Agency's analysis of increased costs since 1994, AMS

proposes to increase the fees for destination market inspection

services. The following table compares current fees and charges with

proposed fees and charges for fresh fruit and vegetable inspection as

found in 7 CFR 51.38. Unless otherwise provided for by regulation or

written agreement between the applicant and the Administrator, the

charges in the schedule of fees as found in Sec. 51.38 are:

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Service Current Proposed

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Quality and condition inspections of one to

four products each in quantities of 51 or

more packages and unloaded from the same

land or air conveyance:

Over a half carlot equivalent of each $74.............................. $78.

product.

Half carlot equivalent or less of each $62.............................. $65.

product.

For each additional lot of the same $12.............................. $13.

product.

Condition inspections of one to four

products each in quantities of 51 or more

packages and unloaded from the same land

or air conveyance:

Over a half carlot equivalent of each $62.............................. $65.

product.

[[Page 24248]]

Half carlot equivalent or less of each $57.............................. $60.

product.

For each additional lot of the same $12.............................. $13.

product.

Inspections of five or more products each

in quantities of 51 or more packages and

unloaded from the same land or air

conveyance:

For the first five products............ $264............................. $277.

For each additional product............ $37.............................. $39.

For each additional lot of any of the $12.............................. $13.

same product.

Inspections of products each in quantities

of 50 or less packages unloaded from the

same land or air conveyance:

For each product....................... $37.............................. $39.

For each additional lot of any of the $12.............................. $13.

same product.

Dock-side inspections of an individual

product unloaded directly from the same

ship:

For each package weighing less than 15 1 cent........................... No change.

pounds.

For each package weighing 15 to 29 2 cents.......................... No change.

pounds.

For each package weighing 30 or more 3 cents.......................... No change.

pounds.

For each additional lot of any of the $12.............................. $13.

same product.

Minimum charge per individual product...... $74.............................. $78.

Inspections performed for other purposes $37 per hour..................... $39 per hour.

during the grader's regularly scheduled

work week.

Overtime or holiday premium rate for all $18.50 per hour.................. $19.50 per hour.

inspections performed outside the

hourgrader's regularly scheduled work week.

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List of Subjects in 7 CFR Part 51

Agricultural commodities, Food grades and standards, Fruits, Nuts,

Reporting and recordkeeping requirements, Trees, Vegetables.

PART 51--[AMENDED]

For reasons set forth in the preamble, 7 CFR Part 51 is proposed to

be amended as follows:

1. The authority citation for 7 CFR Part 51 continues to read as

follows:

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

2. Section 51.38 is revised to read as follows:

Sec. 51.38 Basis for fees and rates.

(a) When performing inspections of product unloaded directly from

land or air transportation, the charges shall be determined on the

following basis:

(1) For products in quantities of 51 or more packages:

(i) Quality and condition inspection of 1 to 4 products unloaded

from the same conveyance:

(A) $78 for over a half carlot equivalent of an individual product.

(B) $65 for a half carlot equivalent or less of an individual

product.

(C) $13 for each additional lot of the same product.

(ii) Condition only inspection of 1 to 4 products unloaded from the

same conveyance:

(A) $65 for over a half carlot equivalent of an individual product.

(B) $60 for a half carlot equivalent or less of an individual

product.

(C) $13 for each additional lot of the same product.

(iii) Quality and condition inspection and/or condition only

inspection of 5 or more products unloaded from the same conveyance:

(A) $277 for the first 5 products.

(B) $39 for each additional product.

(C) $13 for each additional lot of any of the same product.

(2) For quality and condition inspection and/or condition only

inspection of products in quantities of 50 or less packages unloaded

from the same conveyance:

(i) $39 for each individual product.

(ii) $13 for each additional lot of any of the same product.

(b) When performing inspections of palletized products unloaded

directly from sea transportation or when palletized product is first

offered for inspection before being transported from the dock-side

facility, charges shall be determined on the following basis:

(1) For each package inspected according to the following rates:

(i) 1 cent per package weighing less than 15 pounds;

(ii) 2 cents per package weighing 15 to 29 pounds; and

(iii) 3 cents per package weighing 30 or more pounds.

(2) $13 for each additional lot of any of the same product.

(3) A minimum charge of $78 for each product inspected.

(c) When performing inspections of products from sea containers

unloaded directly from sea transportation or when palletized products

unloaded directly from sea transportation are not offered for

inspection at dockside, the car-lot fees in Sec. 51.38(a) shall apply.

(d) When performing inspections for Government agencies, or for

purposes other than those prescribed in the preceding paragraphs,

including weight-only and freezing-only inspections, fees for

inspection shall be based on the time consumed by the grader in

connection with such inspections, computed at a rate of $39 an hour:

Provided, That:

(1) Charges for time shall be rounded to the nearest half hour;

(2) The minimum fee shall be two hours for weight-only inspections,

and one- half hour for other inspections;

(3) When weight certification is provided in addition to quality

and/or condition inspection, a one-hour charge shall be added to the

carlot fee.

(4) When inspections are performed to certify product compliance

for Defense Personnel Support Centers, the daily or weekly charge shall

be determined by multiplying the total hours consumed to conduct

inspections by the hourly rate. The daily or weekly charge shall be

prorated among applicants by multiplying the daily or weekly charge by

the percentage of product passed and/or failed for each applicant

during that day or week. Waiting time and overtime charges shall be

charged directly to the applicant responsible for their incurrence.

(e) When performing inspections at the request of the applicant

during periods which are outside the graders regularly scheduled work

week, a charge for overtime or holiday work shall be made at the rate

of $19.50 per hour or portion thereof in addition to the carlot

equivalent fee, package charge, or hourly charge specified in this

subpart. Overtime or holiday charges for time shall be rounded to the

nearest half hour.

(f) When an inspection is delayed because product is not available

or readily accessible, a charge for waiting time shall be made at the

prevailing hourly rate in addition to the carlot equivalent fee,

package charge, or hourly charge specified in this subpart. Waiting

time shall be rounded to the nearest half hour.

[[Page 24249]]

Dated: May 8, 1996.

Robert C. Keeney,

Director, Fruit and Vegetable Division.

[FR Doc. 96-12057 Filed 5-13-96; 8:45 am]

BILLING CODE 3410-02-P