Fees for Consultation Services for Ship Construction and Renovation

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Disease Control and Prevention

Fees for Consultation Services for Ship Construction and

Renovation

AGENCY: Centers for Disease Control and Prevention (CDC), Department of

Health and Human Services (HHS).

ACTION: Notice.

-----------------------------------------------------------------------

SUMMARY: This notice announces fees for conducting voluntary

inspections of newly constructed or renovated cruise ships. This notice

also announces a change in the proposal to charge a fee for

consultation on construction and renovation, and to add a new ``mega''

size category to the sanitation inspection fee schedule.

DATES: Fees for construction and renovation inspections are effective

June 18, 1998.

FOR FURTHER INFORMATION CONTACT: Daniel M. Harper, Program Manager,

Vessel Sanitation Program, National Center for Environmental Health,

telephone (770) 488-3524 or e-mail [email protected], or Dave Forney, Public

Health Advisor, Division of Environmental Hazards and Health Effects,

National Center for Environmental Health, telephone (770) 488-7333 or

e-mail [email protected].

SUPPLEMENTARY INFORMATION:

Purpose and Background

A notice of request for public comment on a proposal to charge fees

for consultation services for ship construction and renovation, and to

create a new ``Mega'' category for the routine sanitary inspection of

ships was published in the Federal Register on November 17, 1997,

[Volume 62, Pages 61336-61338]. A subsequent amendment to extend the

comment period an additional 30 days was published in the Federal

Register on January 13, 1998, [Volume 63, Number 8, Page 1973].

Discussion of Comments

The public notice of the intent to collect fees for consultation

services for ship construction and renovation and to create a new

``Mega'' category for routine inspections provided a 45 day comment

period which was extended an additional 28 days at the request of the

members of the cruise ship industry. During the comment period,

comments were received from two sources, one of which was the

International Council of Cruise Lines (ICCL) representing the 17

largest passenger cruise lines that call on major ports in the U.S. and

abroad. Discussion of the comments received and CDC's responses

follows:

Comment: One commentor stated that the use of Gross Register Tons

alone does not correctly indicate a ship's capacity to carry passengers

and crew, while the Total Safe Number does, and better reflects the

type of ship that is being inspected.

Response: The fees set forth in the public notice were based on

Gross Register Tonnage (GRT) of the passenger vessels as reported by

Lloyds of London. CDC believes that the use of GRT is a reasonable and

equitable method for determining fees since the number and size of the

food service areas and the size of the onboard water systems are

generally functions of the vessel's GRT. CDC, after considering the

commentor's alternative proposal, sees no advantage in the commentor's

proposal over CDC's. CDC will continue to periodically review the fee

schedule. If actual experience in fee collection indicates that CDC's

proposed system does result in substantial inequity, CDC will act

promptly to correct the situation.

Comment: One commentor stated that the proposed ``Mega'' category

placed an increased financial burden on these large craft by increasing

the basic inspection fee by approximately 31% over what these ships

were charged in 1997. In addition, the galley size and complexity on

these ships is not significantly different than that found on ships in

the Extra Large category.

Response: It has been CDC's experience that the size and complexity

of the galleys and water systems aboard ships >90,000 GRT are often

greater than those found on smaller ships. It is also our belief that

performing sanitation inspections of these ships requires additional

staff time and resources. However, we have not quantified the increase

in resources. Therefore, CDC agrees to postpone any modifications to

the existing category structure until there can be a more thorough

evaluation of the time, effort and other factors involved with the

inspection of these ships.

Comment: One commentor stated that the fee increase in the FY 98

budget should adequately cover the costs of providing construction

consultation services without the creation of a new

[[Page 27580]]

fee category and that this is supported by the vessel fee calculation

utilized in the CDC's Federal Register notice which stipulates that

current inspection fees fully fund the VSP Program. The commentor

states that the proposed consultation fees are duplicative of the fees

already being paid by vessel operators to CDC through the sanitation

inspection fees.

Response: Generally, the CDC recoups the costs of the VSP through

the collection of fees. The fee schedule for sanitation inspections of

passenger cruise ships currently inspected under the VSP was first

published in the Federal Register on November 24, 1987 (52 FR 45019),

and revised in a schedule published in the Federal Register on November

28, 1989 (54 FR 48942). Since then, CDC has published the fee schedule

annually. The formula historically used to determine the fees has been

calculated by dividing the cost of the VSP by the weighted number of

annual inspections. With the tremendous expansion of the cruise line

industry, and concurrent expansion in the number of ships being

constructed and renovated, an increasing percentage of VSP staff time

and expense is being spent on providing consultation directly to the

individual cruise lines building and renovating ships. In the past,

consultations for new construction and renovation have included an

extensive review of the ships' blueprints, an on-site shipyard

inspection as the ship neared completion, and a final construction

inspection. This has contributed to an overall increase in the VSP

budget and reduces the inspector time available to conduct routine

sanitation inspections. Because these construction consultations and

inspections are voluntary and are directed to individual ship owners,

builders and operators, CDC feels that the cost of these services

should be borne by the individual recipients, and not by the collective

cruise lines participating in the vessel sanitation program. CDC did

not include the cost of construction consultations or inspections in

calculating the average cost per inspection for FY 1998. If CDC added

the cost of these voluntary services into the existing formula, the

sanitation inspection for ALL vessels would have been substantially

higher even though none of the existing ships in the program would have

received direct benefit from the consultation.

In order to more equitably distribute the cost of the program among

the participants, CDC will charge for all inspections conducted by VSP

staff. CDC agrees to postpone charging a fee for plan reviews and

consultation during construction and renovation until there can be a

more thorough evaluation of the time, effort and other factors involved

with this activity. Future program budgets will be determined by

dividing the cost of the VSP by the weighted number of all inspections.

Comment: One commentor stated that the proposed fee for

consultation is all inclusive of plan review, shipyard inspection and

final construction inspection and does not allow an interested cruise

line to request a consultation or inspection during a specific

individual phase of construction or renovation.

Response: CDC agrees that a consultation or inspection should be

available for any or all phases of construction and renovation.

Therefore, consultation or inspection services for new construction or

renovation will be provided in three phases:

In Phase 1, CDC will:

Conduct a Plan Review with ship officials in either the

Miami or Atlanta VSP offices and provide a written report, with

recommendations, to the ship officials following the review.

Provide written consultations to the appropriate ship

officials (owners, builders, sub-contractors, etc.) during the

construction phase of the ship.

Provide these plan reviews and consultations at no cost.

In Phase 2, CDC will:

Require that requests for shipyard inspections be

submitted to VSP Atlanta 45 days prior to travel dates (see Appendix

A).

Require that the shipyard pay CDC for all expenses in

connection with the shipyard inspection and make all necessary

arrangements for lodging and transportation, which includes airfare and

ground transportation.

Charge a standard inspection fee for the shipyard

inspection based on the published fee announced annually in the Federal

Register. Provide the shipyard with an invoice at the completion of the

inspection.

Provide a written report of the shipyard inspection.

In Phase 3, CDC will:

Conduct the final construction inspection at a U.S. port

prior to the ship entering operational service. The time and place of

this inspection will be mutually agreed upon by the builder, owner and

VSP staff. This inspection will NOT be scored.

Provide a written report of the final construction

inspection.

Charge a standard inspection fee for the inspection based

on the published fee announced annually in the Federal Register.

Provide the shipyard with an invoice at the completion of the

inspection.

This is a voluntary program for the cruise ship builders/owners and

a formal written request must be made for a consultation and/or

construction inspection. CDC's ability to honor these requests will be

based on the availability of VSP staff. A builder/owner may request any

one, two, or all of the consultation and inspection phases.

CDC will assign one inspector as the ``project manager'' for each

request for consultation or renovation of a ship. The project manager

will be the single point of contact at VSP for any discussion regarding

the ship from the initial plan review through the final construction

inspection. CDC will also provide a second inspector to participate in

all plan reviews, consultations, and inspections.

Fees

CDC will not charge a fee for plan reviews and consultation but

will charge the published standard fee for all inspections conducted by

the program (e.g., shipyard, final construction, sanitation, etc.). The

inspection fee is based on the existing fee schedule for sanitation

inspections of passenger cruise ships, published annually in the

Federal Register.

Fee Schedule January 1, 1998-September 30, 1998

------------------------------------------------------------------------

Inspection

Vessel size and GRT \1\ fee

------------------------------------------------------------------------

Extra Small (60,000)...................................... 8,600

------------------------------------------------------------------------

\1\ GRT--Gross Register Tonnage in cubic feet, as shown in Lloyd's

Register of Shipping.

Applicability

The inspection fees will be applicable to all passenger cruise

vessels requesting and receiving services as described in this notice.

[[Page 27581]]

Dated: May 13, 1998.

Joseph R. Carter,

Acting Associate Director for Management and Operations, Centers for

Disease Control and Prevention (CDC).

Appendix A

Sample

Fax to: Henry Falk, M.D., Director, Division of Environmental

Hazards and Health Effects, National Center for Environmental Health

Centers for Disease Control and Prevention (CDC), 4770 Buford

Highway, NE., Mailstop F-28, Atlanta, GA 30341-3724, Facsimile (770)

488-4127

Fax copy to: Chief, Vessel Sanitation Program, National Center for

Environmental Health Centers for Disease Control and Prevention

(CDC), 4770 Buford Highway, NE., Mailstop F-16, Atlanta, GA 30341-

3724, Facsimile (770) 488-4127

We request the presence of a PHS representative for shipyard

consultation on cruise liner (NAME). We tentatively expect to take

delivery of the cruise liner on (DATE). We would like to schedule

the shipyard consultation for (DATE). We expect the consultation to

take approximately (NUMBER OF DAYS).

We will pay CDC in accordance with the inspection fee published

in the Federal Register, and for all expenses in connection with the

shipyard inspection. We will make all necessary arrangements for

lodging and transportation, which includes airfare and ground

transportation in (CITY, STATE, COUNTRY). We will provide in-kind

for lodging and transportation expenses. All remaining expenses,

such as en route per diem and meals and miscellaneous expenses,

including ground transportation to and from the airport nearest the

representatives work site or residence, should be sent to the

following address:

Company

Attention:

Street Address

City, State, Country

Zip Code

Office Telephone Number

Facsimile Number

If you have questions regarding this confirmation, please

contact:

Signed:

[FR Doc. 98-13212 Filed 5-18-98; 8:45 am]

BILLING CODE 4163-18-P