Announcement of Program Test: Collection of Truck User Fees at Houlton, Maine and Champlain, New York by Means of Electronic Commerce Technology

DEPARTMENT OF THE TREASURY

Customs Service

Announcement of Program Test: Collection of Truck User Fees at

Houlton, Maine and Champlain, New York by Means of Electronic Commerce

Technology

AGENCY: Customs Service, Treasury.

ACTION: General notice.

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SUMMARY: This notice announces Customs plan to test a simplified

procedure pertaining to the collection of commercial truck user fees at

the ports located at Houlton, Maine and Champlain, New York. The test

will allow for the payment of the fees by use of electronic commerce

technology, and is designed to reduce the manual collection and

processing of cash fees by Customs Inspectors at truck booths at these

two ports, thus, allowing them to focus on inspectional work. Public

comments concerning any aspect of the test are solicited.

EFFECTIVE DATES: This test will commence no earlier than May 11, 1998

and will run for approximately six months, with evaluations of the

program occurring periodically. Comments must be received on or before

May 11, 1998.

ADDRESSES: Written comments regarding this notice or any aspect of this

test should be addressed to Richard Wilcox, North Atlantic Customs

Management Center, 10 Causeway Street, Suite 801, Boston, Massachusetts

02222-1056.

FOR FURTHER INFORMATION CONTACT: Supervisory Customs Inspector Dennis

Grenier, Port Trade Compliance Process Owner, Houlton, Maine, (207)

532-2131; or, Richard Wilcox, North Atlantic Customs Management Center,

Boston, Massachusetts, (617) 565-6324.

SUPPLEMENTARY INFORMATION:

Background

The Customs Regulations pertaining to the collection of certain

user fees for Customs Services provide that these fee payments shall be

in the amounts prescribed and shall be in U.S. currency, or by check or

money order payable to the United States Customs Service, in accordance

with the provisions of Sec. 24.1 (19 CFR 24.1). See 19 CFR 24.22(i)(1).

In the case of commercial trucks, the fees are $5.00 per arrival,

unless a $100.00 prepayment has been made for the calendar year and a

decal has been affixed to the vehicle windshield to show that the

vehicle is exempt from payment of the fee on an individual arrival

basis during the applicable calendar year. See 19 CFR 24.22(c).

This fee collection procedure has tasked Customs officers for years

to collect the $5.00 user fee, in cash, from those commercial trucks

that do not display an annual decal. In general, there are several

problems which arise from this cash collection system. On the remitting

side, often, the driver has no cash or only has foreign currency. On

the collection side, Customs officers must spend many hours each day

collecting, verifying, reporting, depositing, and administering this

system, which keeps them from attending to inspectional and supervisory

work. Further, large trucking companies complain that, because of the

way the present user fee system operates, i.e., it is only economical

to purchase annual decals for those trucks that are routinely utilized

in cross-border deliveries, the non-decaled portion of their commercial

trucking fleets have become ``captive'' to utilization in less

profitable ventures. These large trucking companies argue that if all

their trucks could be utilized for timely cross-border work, this

circumstance would enable them to employ their resources more

efficiently and profitably.

As an example, under the present fee collection procedure followed

at the Houlton, Maine, port of entry, the Customs inspector visually

checks the truck window for the presence of a decal. If there is a

decal, the inspector proceeds to the entry/examination/release cargo

process. If there is no decal, the inspector must collect $5.00 in U.S.

currency, as required by Sec. 24.22(i)(1), Customs Regulations (19 CFR

24.22(i)(1)). Should the driver wish to purchase a decal at the time he

drives up to the booth, the inspector will have the driver park the

truck and go into the Customs/INS lobby area and purchase the decal

there. If the driver has neither the decal nor the U.S. $5.00, then the

driver is told to park the truck and ask the customs broker preparing

the entry for the $5.00 to pay the fee. Should this not occur, the

driver must wait until either another driver lends him the $5.00 or a

trucking company representative arrives at the port with

[[Page 17928]]

the payment. Approximately 33 percent of the roughly 450 trucks

arriving daily at the Houlton port of entry pay the user fee in cash.

The inspector who collects the $5.00 fee at Houlton rings it into

the cash register and issues a receipt to the driver. The senior

inspector or supervisor will then reconcile the cash each day and turn

it over to either a Customs aide or supervisor for a second

verification, and the money then will be placed in the safe. Two or

three times a week, an SF 215B Deposit Form is prepared by the Customs

aide or a supervisor, and the money is driven to the local bank for

deposit. This procedure requires many man-hours of administrative work

and is not an efficient method for the collection and processing of the

$5.00 cash fees.

To address this situation, Customs at Houlton, Maine put together a

Process Improvement Group: the Group was comprised of representatives

from Yellow Freight Trucking, the American Trucking Association, and

Roadway Express, Inc., the Vice President of KeyBank of Maine, and two

Customs Management Center facilitators. The members of this Group were

guided through the process improvement techniques, created a mission

statement, and determined that the test program should only be

conducted at Houlton, Maine and Champlain, New York, and that, if

successful, it could then be expanded to other test locations. The

mission statement adopted for this test program states that it is to

develop an efficient system/process for user fee payments by trucks,

without the use of cash or decals, for the benefit of all users and

Customs. The Group concluded that some form of automated debit

technology, such as a credit or debit card system, should be utilized,

one which would be uniform in application nationally and would accept

major credit cards such as VISA and MASTERCARD.

The Proposed Truck User Fee Collection System at Houlton

According to the simplified procedure proposed to be tested, the

Customs inspector will visually check the truck window for the presence

of a user fee decal. If there is no decal, the inspector will either

collect the U.S. $5.00 in accordance with the existing procedure, or

accept a VISA or MASTERCARD credit card from the driver, process it

through an automated system that will deposit the user fee directly

into the Treasury account via the Mellon Bank, issue a receipt to the

driver, keep a copy for Customs accounting purposes, and process the

merchandise transaction.

In this scenario, there will be much less handling of currency,

less administrative work required of supervisors and senior inspectors,

more control over the deposits, and fewer trips to the bank to deliver

cash. It will also allow those trucking companies with ``captive''

fleets to use all of their trucks for cross-border work, whether or not

they have decals. This system actually could eliminate the need for

truck decals altogether.

The implementation of such a user-friendly system would enable

Customs internal and external customers to work more efficiently and

effectively, eliminate the need for processing cash by Customs

inspectors, provide a secure deposit of fees directly into the Treasury

account, and free up resources and equipment for all concerned.

To aid in the development of this initiative, Customs proposes a

temporary change to the current procedures concerning the collection of

truck user fees to allow for the electronic payment of this user fee by

credit card. Accordingly, the fee payment requirements contained in

Sec. 24.22(i)(1) of the Customs Regulations will be suspended during

this test period so that electronic commerce technology will be

accepted. This procedure will only apply at the ports located at

Houlton, Maine and Champlain, New York, and will not otherwise affect

the procedures relating to other forms of user fee payments which are

still in effect. Trucking companies who wish to participate in this

pilot program should experience faster service, fewer delays at the

truck booth, and enhanced service to their cross-border customers.

Pursuant to Customs Modernization provisions in the North American

Free Trade Agreement Implementation Act (the Act), Pub. L. 103-182, 107

Stat. 2057, 2170 (December 8, 1993), Customs amended its regulations

(19 CFR chapter I), in part, to enable the Commissioner of Customs to

conduct limited test programs/procedures designed to evaluate the

effectiveness of new technology or operations procedures, which have as

their goal the more efficient and effective processing of passengers,

carriers, and merchandise. Section 101.9(a) of the Customs Regulations

(19 CFR 101.9(a)) allows for such general testing. See, TD 95-21. This

test is established pursuant to that regulatory provision.

The implementation date for a test of this new procedure will be in

early May of 1998 (approximately 30 days from publication in the

Federal Register). Upon implementation, Customs at Houlton, Maine and

Champlain, New York will begin an evaluation period of at least six

months to ensure the effectiveness of the program and to identify any

shortfalls. If the program is successful, Customs will amend its

regulations to make the new procedure permanent.

Regulatory Provisions Affected

During the automated user fee collection test, the normal user fee

collection requirements of 19 CFR 24.22(i)(1) will be suspended.

Enforcement Provisions

Nothing in this test in any way interferes with Customs enforcement

activities. Cargo will still be examined for compliance with laws and

regulations, stratified examinations will continue, and targeted

shipments will be stripped out of the trucks and examined as usual.

Comments and Evaluation of Test

Customs will review all public comments received concerning any

aspect of the test program or procedures, and finalize procedures in

light of those comments. Approximately 120 days after the conclusion of

the test, evaluations of the test will be conducted and final results

will be made available to the public upon request.

Dated: April 7, 1998.

Robert S. Trotter,

Assistant Commissioner, Office of Field Operations.

[FR Doc. 98-9531 Filed 4-9-98; 8:45 am]

BILLING CODE 4820-02-P