FR Doc 03-6797

[Federal Register: March 21, 2003 (Volume 68, Number 55)]
[Proposed Rules]
[Page 13861-13872]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr21mr03-23]

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DEPARTMENT OF AGRICULTURE

Animal and Plant Health Inspection Service

7 CFR Part 354

9 CFR Parts 97 and 130

[Docket No. 02-040-1]

Veterinary Services User Fees; Fees for Endorsing Export
Certificates for Ruminants

AGENCY: Animal and Plant Health Inspection Service, USDA.

ACTION: Proposed rule.

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SUMMARY: We are proposing to amend the user fees for endorsing export
health certificates by establishing a separate user fee that would
cover the cost of endorsing certificates that do not require
verification of tests or vaccinations for ruminants. We are proposing
this change to ensure that we recover all of the costs associated with
providing that service. We are also proposing to make several
miscellaneous changes to clarify the existing regulations.

DATES: We will consider all comments that we receive on or before May
20, 2003.

ADDRESSES: You may submit comments by postal mail/commercial delivery
or by e-mail. If you use postal mail/commercial delivery, please send
four copies of your comment (an original and three copies) to: Docket
No. 02-040-1, Regulatory Analysis and Development, PPD, APHIS, Station
3C71, 4700 River Road Unit 118, Riverdale, MD 20737-1238. Please state
that your comment refers to Docket No. 02-040-1. If you use e-mail,
address your comment to regulations@aphis.usda.gov. Your comment must

be contained in the body of your message; do not send attached files.
Please include your name and address in your message and ``Docket No.
02-040-1'' on the subject line.
You may read any comments that we receive on this docket in our
reading room. The reading room is located in room 1141 of the USDA
South Building, 14th Street and Independence Avenue, SW., Washington,
DC. Normal reading room hours are 8 a.m. to 4:30 p.m., Monday through
Friday, except holidays. To be sure someone is there to help you,
please call (202) 690-2817 before coming.
APHIS documents published in the Federal Register, and related
information, including the names of organizations and individuals who
have commented on APHIS dockets, are available on the Internet at
http://www.aphis.usda.gov/ppd/rad/webrepor.html.

http://www.aphis.usda.gov/ppd/rad/webrepor.html.

FOR FURTHER INFORMATION CONTACT: For information concerning program
operations, contact Ms. Inez Hockaday, Acting Director, Management
Support Staff, VS, APHIS, 4700 River Road Unit 44, Riverdale, MD 20737-
1231; (301) 734-7517.
For information concerning rate development, contact Ms. Kris
Caraher, Accountant, User Fee Section, Financial Management Division,
APHIS, 4700 River Road Unit 54, Riverdale, MD 20737-1231; (301) 734-
8351.

SUPPLEMENTARY INFORMATION:

Background

User fees to reimburse the Animal and Plant Health Inspection
Service (APHIS) for the costs of providing veterinary diagnostic
services and import- and export-related services for animals, animal
products, birds, germ plasm, organisms, and vectors are contained in 9
CFR part 130. Section 130.20 lists user fees we charge for endorsing
health certificates for animals, birds, or animal or nonanimal products
exported from the United States. Importing countries often require
these certificates to show that an animal, bird, or product has tested
negative to specific animal diseases or that the animal, bird, or
product has not been exposed to specific animal diseases. The
endorsement indicates that APHIS has reviewed a certificate and
believes it to be accurate and reliable. The steps associated with
endorsing an export certificate may include reviewing supporting
documentation; confirming that the importing country's requirements
have been met; verifying laboratory test results for each animal if
tests are required; reviewing any certification statements required by
the importing country; and endorsing, or signing, the certificates. Our
user fees are intended to cover all of the costs associated with
endorsing the certificates.
The user fees we charge to endorse export health certificates vary,
depending on whether or not the importing country requires verification
of tests or vaccinations and the type and quantity of animals, birds,
or products covered by the certificate. For those certificates that do
not require verification of tests or vaccinations, paragraph (a) of
Sec. 130.20 lists user fees for the following certificate categories:
Animal and nonanimal products; hatching eggs; poultry, including
slaughter poultry; slaughter animals (except poultry) moving to Canada
or Mexico; and other endorsements or certifications. For those
certificates that require verification of tests or vaccinations,
paragraph (b) of Sec. 130.20 lists user fees based on the number of
animals or birds and the number of tests or vaccinations on the
certificate, and whether the animals covered by the certificate are
nonslaughter horses moving to Canada or are other animals or birds.
Currently, user fees for the endorsement of export health certificates
for ruminants, except for ruminants exported for slaughter to Canada or
Mexico, are included in the certificate categories ``Other endorsements
or certifications'' and ``Other animals or birds'' in paragraphs (a)
and (b) of Sec. 130.20, respectively.
On August 28, 2000, we published a final rule in the Federal
Register (65 FR 51997-52010, Docket No. 97-058-2) that amended the user
fees for, among other things, the endorsement of export health
certificates. We calculated the user fees established by that final
rule to cover the costs associated with providing that service, which
include direct labor and direct material costs.
Since the time we calculated the fees established in the August
2000 final rule, we have conducted a review of the costs of endorsing
export health certificates. In that review, we found that the projected
direct labor costs used to calculate the multi-year user fees for the
certificate category ``Other endorsements or certifications'' in Sec.
130.20(a) are less than the actual direct labor costs for the
endorsement of certificates for ruminants, which is covered by that
certificate category. As a result, the user fees charged to endorse
certificates in accordance with Sec. 130.20(a) for ruminants are less
than the actual cost of providing that service. For the user fees to
cover all the costs associated with endorsing such certificates for
ruminants, including the direct labor costs, we propose to establish a
new certificate category and user fee in Sec. 130.20(a) for ruminants.
APHIS currently charges $23 to endorse each certificate covered by
the certificate category ``Other endorsements or certifications'' in
Sec. 130.20(a). We have estimated the actual cost of providing that
service for ruminants to be $33 for each endorsement; therefore, we
propose to increase the current user fee charged for

[[Page 13862]]

such an endorsement by $10 to $33. If adopted, this proposed user fee
would take effect on the effective date of the final rule for this
action.
Slaughter ruminants exported to Canada or Mexico that require
certification under Sec. 130.20(a) are covered by the certificate
category ``Slaughter animals (except poultry) moving to Canada or
Mexico.'' To make it clear that slaughter ruminants exported to Canada
or Mexico would continue to be covered by that certificate category,
and not by the certificate category for ruminants proposed in this
rule, we also propose to amend the title of the category for slaughter
animals in Sec. 130.20(a) to ``Slaughter animals (except poultry but
including ruminants) moving to Canada or Mexico.'' Similarly, the title
of the proposed new category for ruminants would read: ``Ruminants,
except slaughter ruminants moving to Canada or Mexico.'' The user fees
currently listed in Sec. 130.20(a), including those fees for slaughter
animals exported to Canada or Mexico, would not be affected by this
proposed change.

Calculation Methodology

We calculated the user fee for endorsing export health certificates
that do not require verification of tests or vaccinations for ruminants
to cover the full costs associated with reviewing and endorsing a
certificate. The costs of providing that service are the direct labor
costs, administrative support costs, billing and collections costs,
agency overhead, departmental charges, and a reserve component.
Direct labor costs are the salary and benefit costs of employee
time spent specifically to endorse a certificate. To calculate the
direct labor costs, we included time for a GS-14 step 5 veterinarian to
provide information over the phone, research regulations, send any
necessary facsimiles, and review, sign, and audit paperwork. We also
included time for a GS-5 step 5 export clerk to review the contents of
the certificate, print a receipt, enter and process information in the
system, verify the origin and identity of the animal(s) by researching
farms and matching eartags, handle collections, and mail
certifications. We used the actual hourly salary of a GS-14 step 5 and
a GS-5 step 5 during fiscal year (FY) 2002 (October 1, 2001, through
September 30, 2002) and took into consideration the anticipated
increases in the cost of living for fiscal years 2003 and 2004 that
were projected in the President's Budget for FY 2003 (October 1, 2002,
through September 30, 2003). Finally, we included employee benefit
costs at 20.42 percent of the total employee salary costs. Based on
this approach, we estimate that the direct labor cost associated with
the endorsement of export health certificates that do not require
verification of tests or vaccinations for ruminants is $15.12 for each
certificate.
Administrative support costs include local clerical and
administrative activities; indirect labor hours; travel and
transportation for personnel; supplies, equipment, and other necessary
items; training; general office supplies; rent; equipment
capitalization; billings and collections expenses; utilities; and
contractual services. Indirect labor hours include supervision of
personnel and time spent doing work that is not directly connected with
endorsing the certificates but which is nonetheless necessary, such as
repairing equipment. Rent is the cost of using the space we need to
perform work related to endorsing the certificates. Equipment
capitalization is the cost per year to replace equipment, which we
determine by establishing the life expectancy, in years, of equipment
we use to endorse the certificates and by establishing the cost to
replace the equipment at the end of its useful life. We subtract any
money we anticipate receiving for selling used equipment. Then we
divide the resulting amount by the life expectancy of the equipment.
The result is the annual cost to replace equipment. Billing costs are
the costs of managing user fee accounts for our customers who wish to
receive monthly invoices for the services they receive from APHIS.
Collections expenses include the costs of managing customer payments
and accurately reflecting those payments in our accounting system.
Utilities include water, telephone, electricity, gas, heating and oil.
Contractual services include security service, maintenance, trash
pickup, etc. We have calculated the administrative support costs for
each endorsement to be $10.85.
Agency overhead is the pro-rata share, attributable to endorsing
the certificates, of the agency's management and support costs.
Management and support costs include the costs of providing budget and
accounting services, regulatory services, investigative and enforcement
services, debt-management services, personnel services, public
information services, legal services, liaison with Congress, and other
general program and agency management services provided above the local
level. We have determined that $4.19 for each endorsement covers the
agency overhead associated with providing that service.
Departmental charges are APHIS's share, expressed as a percentage
of the total cost, of services provided centrally by the Department of
Agriculture (Department). Services the Department provides centrally
include the Federal Telephone Service; mail; National Finance Center
processing of payroll, and other money management; unemployment
compensation; Office of Workers Compensation Programs; and central
supply for storing and issuing commonly used supplies and Department
forms. The Department notifies APHIS how much the agency owes for these
services. We have included a pro-rata share of these departmental
charges of $1.38, as attributable to the endorsement of export health
certificates that do not require verification of tests or vaccinations
for ruminants, in our fee calculation.
We have added an amount that would help provide for a reasonable
balance, or reserve, in the Veterinary Services' (VS) user fee account.
We maintain a reserve in the VS user fee account that is equal to
approximately 25 percent of the annual cost of the Import/Export
Program to ensure that we have sufficient operating funds in cases of
bad debt, customer insolvency, and fluctuations in activity volumes.
All user fees contribute to the reserve proportionately. We have
included a pro-rata share of the reserve of $1.58, as attributable to
each endorsement, in our fee calculation.
We added all of the costs, as discussed above, to obtain our cost
of $33.12 to endorse export health certificates that do not require
verification of tests or vaccinations for ruminants, except for
slaughter ruminants exported to Mexico or Canada. We then rounded this
cost to the nearest whole dollar to obtain a user fee of $33 for each
certification. As mentioned above, if this proposed rule is adopted,
the user fee for the new certificate category would take effect on the
effective date of the final rule for this action. As is the case with
all APHIS user fees, we intend to review, at least annually, the user
fee proposed in this document. We will publish any necessary
adjustments in the Federal Register.
We are also proposing to make several miscellaneous changes to the
regulations for clarity. As mentioned above, the regulations in 9 CFR
part 130 contain, among other things, tables that list multi-year user
fees for certain veterinary diagnostic services and import- and export-
related services. In addition to listing user fees for the current and
future fiscal years (FY 2003

[[Page 13863]]

and beyond), many of the tables in part 130 list user fees for fiscal
years 2001 and/or 2002. Because fiscal years 2001 and 2002 have passed,
we believe it is no longer necessary to list the user fees for those
fiscal years in the regulations. Therefore, we are proposing to amend
the user fee tables in the part 130 by removing columns that list fees
for fiscal years 2001 and 2002.
Similarly, we would also remove the columns for fiscal year 2002
from the overtime rates tables found in 7 CFR part 354 and 9 CFR parts
97 and 130 (those tables list multi-year overtime rates for inspection,
laboratory testing, certification, or quarantine services provided by
APHIS employees on a holiday, Sunday, or at any other time outside of
an employee's regular tour of duty).

Executive Order 12866 and Regulatory Flexibility Act

This proposed rule has been reviewed under Executive Order 12866.
The rule has been determined to be not significant for the purposes of
Executive Order 12866 and, therefore, has not been reviewed by the
Office of Management and Budget.
APHIS charges flat-rate user fees to individuals, firms,
corporations, and other entities for the endorsement of export health
certificates for animals, birds, or animal or nonanimal products. These
user fees vary, depending on whether or not the importing country
requires verification of tests and the type and quantity of animals,
birds, or products covered by the certificate. There is one user fee
schedule for certificates that require verification of tests or
vaccinations and another schedule for certificates that do not require
such verification.
Currently, certifications for ruminants that do not require
verification of tests or vaccinations, other than certifications for
slaughter ruminants exported to Mexico or Canada, are covered by a
miscellaneous ``catchall'' user fee certificate category. (Ruminants
exported to Mexico and Canada for slaughter are covered by a separate
user fee that includes all slaughter animals, except poultry, exported
to those two countries). APHIS currently charges $23 per endorsement
for services covered by that miscellaneous certificate category. Based
on our review of the costs associated with endorsing export health
certificates, we have determined that the current user fee charged for
the miscellaneous certificate category does not cover all of our costs
to endorse such certificates for ruminants. As a result, we are
proposing to establish a new certificate category and user fee for that
service. If adopted, this proposal would increase the current user fee
charged to endorse certificates that do not require verification of
tests or vaccinations for ruminants, except slaughter ruminants
exported to Mexico or Canada, by $10 to $33 for each endorsement. We
are proposing this change to ensure that we recover our costs for
providing that service, which include direct labor costs,
administrative support costs, billing and collection costs, Agency
overhead, departmental charges, and a reserve component.
This proposed rule would affect entities who export ruminants,
other than slaughter ruminants exported to Mexico or Canada, to
countries that do not require that export health certificates include
verification of tests or vaccinations. Because entities who export
ruminants to Mexico or Canada for immediate slaughter are covered by a
separate user fee category, such entities would not be affected by this
proposed rule. Whether or not an importing country requires
verification of tests or vaccinations for ruminants depends on such
factors as the type of animal exported, the time of year exportation
occurs, and the health status of an animal's herd or State of origin. A
representative overview of countries that import ruminants from the
United States (including Brazil, Canada, China, Dominican Republic,
Japan, Mexico, Nicaragua, Philippines, and Turkey) indicates that most
countries require that export health certificates include verification
of testing or vaccinations for ruminants.\1\ For example, importing
countries almost always require U.S.-origin ruminants to be tested for
brucellosis and tuberculosis, and frequently require those animals to
be tested for such diseases as anaplasmosis, bluetongue, Johne's
disease, leptospirosis, and vesicular stomatitis, among others.
However, two countries, Mexico and Canada, do not currently require
verification of tests or vaccinations for some cattle, sheep, and
goats, under certain conditions.
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\1\ Import health requirements of foreign countries, including
required certification statements and testing, may be found on the
Internet at http://www.aphis.usda.gov/vs/ncie/iregs/animals/.
_____________________________________-

As shown in Table 1, below, trade statistics indicate that the
majority of U.S.-origin cattle, sheep, and goats are exported to Mexico
and Canada. For example, 56.6 percent of purebred cattle, 99.6 percent
of not purebred cattle, 99.5 percent of sheep, and 82.3 percent of
goats exported from the United States during 1999-2001 were shipped to
Mexico or Canada. Of those animals listed in Table 1, animals
categorized as ``not purebred cattle'' (which include feeder cattle,
cattle exported for immediate slaughter, and other not purebred cattle)
comprise the single largest category, accounting for 83 percent of the
total number of cattle, sheep, and goats exported from the United
States during 1999-2001.

Table 1.--Value of U.S. Exports of Cattle, Sheep, and Goats to Mexico, Canada, and the Rest of the World
[Dollar amounts and percentage shares of each livestock category as annual averages for 1999-2001]
----------------------------------------------------------------------------------------------------------------
Mexico Canada Rest of the world
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Purebred cattle.................. $9.86 million $2.39 million $9.39 million (43.4%)
(45.8%). (10.8%).
Not purebred cattle.............. $70.77 million $145.74 million $718,000 (0.4%).
(32.4%). (67.2%).
Sheep............................ $18.00 million $391,000 (2.1%)..... $85,000 (0.5%).
(97.4%).
Goats............................ $1.95 million $206,000 (8.1%)..... $487,000 (17.7%).
(74.2%).
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Source: World Trade Atlas, based on U.S. Census data.

Because Mexico and Canada are the principal markets for ruminants
exported from the United States that do not require health certificates
to include verification of tests or vaccinations, we can expect that
entities who export cattle, sheep, and goats to those two countries
would be most affected by this proposed rule. As a result, this
analysis will focus on the importation requirements of Mexico and
Canada for U.S.-origin cattle, sheep, and goats.

[[Page 13864]]

U.S. Ruminant Exports to Mexico

Mexico does not require verification of tests or vaccinations for
the following ruminants imported from the United States: Steers and
spayed heifers shipped as feeder cattle; slaughter cattle, unless from
Texas or Missouri; sheep other than rams; and goats other than breeding
stock. Because Texas and Missouri are not designated as brucellosis
Class-Free States, cattle imported for slaughter from those two States
must be tested for that disease. Breeding cattle imported into Mexico
from any State are required to be tested for brucellosis only if the
animal is less than 6 months of age, or is an official calfhood
vaccinate less than 20 months of age raised for dairy production or a
vaccinate less than 24 months of age raised for beef. However, all
breeding cattle, except for those animals under 1 month of age, must be
tested for tuberculosis. For sheep and goats, Mexico requires that
breeding and feeder rams be tested for brucellosis and breeding goats
be tested for tuberculosis.
As mentioned above, animals other than poultry exported to Mexico
and Canada for slaughter are covered by a separate user fee category.
As a result, exporters of slaughter ruminants, including slaughter
cattle, exported to Mexico or Canada would not be affected by this
proposed rule. Slaughter cattle account for the majority of not
purebred cattle exported to Mexico from the United States.\2\ As shown
in Table 1, the annual value of not purebred cattle exported to Mexico
from the United States is estimated to be about $71 million. APHIS
export certification data indicate that approximately 62 percent of not
purebred cattle shipped to Mexico were exported from the United States
for purposes other than slaughter.\3\ We can expect, therefore, that
the annual value of not purebred cattle exported to Mexico that would
be affected by this proposed rule to be approximately $44 million
($70.77 million multiplied by 0.62).
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\2\ APHIS, Centers for Epidemiology & Animal Health (CEAH),
1999-2001.
\3\ APHIS CEAH, 1999-2001.
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This proposed rule would have a negligible economic impact on
exporters of sheep and goats shipped to Mexico, as over 99 percent of
sheep and 96 percent of goats from the United States to Mexico are
intended for slaughter and would not, therefore, be covered by the
certificate category and user fee proposed in this document.

U.S. Ruminant Exports to Canada

Ruminants exported to Canada that do not require testing or
vaccination are feeder cattle from Hawaii, Montana, and Washington;
sheep and goats intended for immediate slaughter; and some purebred
cattle, sheep, and goats, depending on the health status of the State
or herd from which the animal originated and the time of year the
animals are shipped.
Canada requires feeder cattle imported from most States to be
tested for tuberculosis and anaplasmosis, and requires certain feeder
cattle to be tested for brucellosis and bluetongue. Brucellosis testing
is not required for steers and spayed heifers and official calfhood
vaccinates that were vaccinated with Strain 19 vaccine. For all other
cattle, brucellosis testing requirements depend on the brucellosis
status of the animal's herd and State. Currently, all States except
Missouri and Texas are classified as brucellosis Class-Free. As a
result, feeder cattle exported to Canada from all States except
Missouri and Texas are exempt from brucellosis testing. Bluetongue test
requirements depend on whether the animal comes from a low-, medium-,
or high-incidence State and/or the time of year the animal is exported.
For example, feeder cattle imported into Canada between October 1 and
December 31 are not required to be tested for bluetongue, regardless of
the State of origin.
As an alternative to the foregoing testing requirements, Canada
accepts shipments of untested feeder cattle under its Restricted Feeder
Cattle Program.\4\ To participate in this program, a State must meet
certain requirements, including being free of brucellosis and
tuberculosis and classified as a low risk for bluetongue, and must
submit to Canada summary data for anaplasmosis. Currently, Hawaii,
Montana, and Washington are allowed to export untested feeder cattle to
Canada under the Restricted Feeder Cattle Program. Cattle imported by
Canada under this program may only enter the country between October 1
and March 31.
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\4\ Canadian Food Inspection Agency, Client Services Information
Sheet No. 14, Restricted Feeder Cattle from the United States.
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Testing requirements for breeding cattle exported to Canada depend
on a given animal's particular circumstances. For example, brucellosis
and anaplasmosis testing requirements depend on the health status of
the herd and State, and bluetongue testing requirements depend on the
State's classification and/or the time of year the animal is exported
to Canada. Breeding cattle need not be tested for tuberculosis if the
entire herd from which the animal originated is tested within the 12
months preceding exportation.
Sheep and goats exported to Canada for immediate slaughter need not
be tested for bluetongue. For all other sheep and goats, testing for
bluetongue depends on the status of the exporting State and/or the time
of year of the export. For example, Canada does not require sheep and
goats exported from any State between October 1 and December 31 to be
tested for bluetongue, assuming that the animals have resided only in
the United States or Canada.
As shown in Table 1, not purebred cattle, which predominantly
consist of feeder cattle, account for the single largest category of
ruminants exported to Canada that would be affected by this proposed
rule. Because Hawaii, Montana, and Washington are the only States
currently allowed to export feeder cattle to Canada without tests or
vaccinations under the Restricted Feeder Cattle Program, we can expect
that exporters of ruminants from those three States would be most
affected by this proposed rule. Table 2 shows approximate average
annual values of feeder cattle exported to Canada from Hawaii, Montana,
and Washington, 1999-2001. These values are for cattle classified under
Harmonized Schedule code 010290 (not purebred), and, therefore, may
include animals exported for immediate slaughter and other not purebred
animals; however, the majority of cattle under this classification are
imported by Canada under its Restricted Feeder Cattle Program for
feeding and subsequent slaughter.

[[Page 13865]]

Table 2.--Approximate Average Annual Values of Feeder Cattle Exports to
Canada From the States of Hawaii, Montana, and Washington, 1999-2001
------------------------------------------------------------------------

------------------------------------------------------------------------
Hawaii.................................................. $2,383,000
Montana................................................. 84,999,000
Washington.............................................. 8,821,000
---------------
Total............................................... 96,203,000
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Source: Industry Canada, Trade Data Online, based on data obtained from
Statistics Canada and the U.S. Census Bureau, U.S. Department of
Commerce.
Note: Values are for Harmonized Schedule code 010290--Bovine, live--Not
Pure-bred, which are predominantly feeder cattle, but may include
other cattle. The values, therefore, are only approximate feeder
cattle values.

Montana's livestock exporters, in particular, have benefitted from
the Restricted Feeder Cattle Program. A total of 127,643 restricted
feeder cattle were shipped to Canada from Montana during the 1999-2000
season. In the 2000-2001 season, Montana shipped 133,240 head.\5\ The
total value of feeder cattle exported from the three States to Canada,
shown in Table 2 to be $96 million, comprises two-thirds of the $146
million shown in Table 1 for all not purebred cattle exported to
Canada.
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\5\ Montana Department of Livestock.
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Statistics on other ruminants exported to Canada and affected by
this proposed rule are not available. However, as mentioned above,
exports of such ruminants, which include certain breeding stock, are
not nearly as important as exports of not purebred cattle.

The User Fee Increase and Ruminant Export Values

The total value of ruminant exports that would be affected by this
proposed rule and for which statistics are available is approximately
$140 million annually. This figure accounts for about 54 percent of
cattle, sheep, and goats exported from the United States.\6\ However,
even though a sizable percentage of U.S. ruminant exports would be
affected by the proposed user fee increase, we do not expect that this
proposed rule would have a significant impact on a substantial number
of entities. The $10 proposed increase in user fees for the endorsement
of certificates that do not require verification of tests or
vaccinations for ruminants represents a small amount of the average
export value of cattle. Furthermore, the $10 proposed increase in user
fees is small compared to the total value of livestock usually included
on a single health certificate, as most health certificates are issued
for more than one animal and the new user fee of $33 would apply for
any number of animals covered by a single certificate.
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\6\ Feeder cattle exports to Canada from Hawaii, Montana, and
Washington ($96 million) + not purebred cattle exports to Mexico
($44 million) = $140 million. (Overcounting of affected cattle and
smallstock shipments to Mexico is assumed to be balanced by
undercounting of affected cattle and smallstock shipments to
Canada.) All U.S. exports total about $260 million (Table 1).
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This proposed rule would have the largest effect on exporters of
not purebred cattle intended for export to Mexico and Canada. Table 3
shows the average value for each animal for those ruminant categories.
The proposed $10 increase in user fees represents approximately 2
percent of the average value of not purebred cattle exported to Mexico
and Canada from the United States.

Table 3.--Average Values of Not Purebred Cattle Exported to Mexico and
Canada and Percentages of the Values Represented by the Proposed $10
Increase in User Fees
------------------------------------------------------------------------
$10 user fee
increase as a
Average value percentage of
per animal the average
value
------------------------------------------------------------------------
Not Purebred Cattle:
Exported to Mexico.............. $464 2.2
Exported to Canada.............. 504 2.0
------------------------------------------------------------------------
Source: World Trade Atlas, based on U.S. Census Bureau data. Values are
annual averages for 1999, 2000, and 2001.

However, these percentages overstate the potential impact of the
proposed user fee increase, as numerous animals are usually exported
using a single certificate. For example, from 1999 through 2001, the
average number of feeder cattle exported to Canada per certificate
numbered 798 head.\7\ Based on this average number of cattle per
certificate, the $10 proposed user fee increase would account for only
0.002 percent of the total value of livestock included in a single
health certificate.\8\
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\7\ Calculated from data obtained from APHIS CEAH.
\8\ Average total value of feeder cattle exported to Canada, for
each health certificate, is $402,192: ($10 divided by $402,192)
multiplied by 100 = 0.002 percent.
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Impact on Small Entities

The Regulatory Flexibility Act require agencies to consider the
economic impact of their rules on small entities, such as small
businesses, organizations, and governmental jurisdictions. This
proposed rule would affect livestock operations that export ruminants
to Mexico or Canada, which include such entities as cattle ranches and
farms, sheep and goat farms, and cattle feedlots.
Under the standards established by the Small Business
Administration (SBA), a business, firm, organization or other entity
engaged in cattle ranching and farming, sheep farming, or goat farming
is considered small if the entity has annual sales of $750,000 or
less.\9\ In 1997, there were 651,542 cattle farms and 29,790 sheep and
goat farms. Of

[[Page 13866]]

those entities, 99 percent of cattle farms (656,181) and 99 percent of
sheep and goat farms (29,938) are considered small entities under the
SBA's standards.\10\
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\9\ Cattle ranching and farming, North American Industry
Classification System (NAICS) code 112120; sheep farming, NAICS
112410; and goat farming, NAICS 112420.
\10\ 1997 Census of Agriculture, USDA National Agricultural
Statistics Service (NASS). Sales information for these farms
identifies a data break at annual sales of $500,000, not at
$750,000.
---------------------------------------------------------------------------

Cattle feedlots are considered small under the SBA's standards if
their annual sales are $1.5 million or less.\11\ Over 97 percent of
feedlots (95,000 of 97,091) have capacities of fewer than 1,000 head,
and average annual sales of about 420 head.\12\ Assuming each head sold
for $1,000, these fewer-than-1,000 head capacity feedlots would
generate, on average, $420,000 in sales. Clearly, most feedlots that
export ruminants to Mexico or Canada are also considered small
entities.
---------------------------------------------------------------------------

\11\ Cattle feedlots, NAICS 112112.
\12\ ``Cattle on Feed,'' NASS, February 2001.
---------------------------------------------------------------------------

The proposed $10 increase in user fees for the endorsement of
ruminant export health certificates that do not require verification of
testing or vaccination, except ruminants exported from Mexico or
Canada, would not have a significant economic impact on a substantial
number of entities, large or small, given the value and number of
animals usually listed on a single health certificate. Although the
majority of entities potentially affected by this proposed rule are
small entities, and the majority of cattle, sheep, and goats exported
by the United States do not require testing or vaccination, the
proposed user fee increase is small compared to the average total value
of livestock normally included on a single health certificate.
Under these circumstances, the Administrator of the Animal and
Plant Health Inspection Service has determined that this action would
not have a significant economic impact on a substantial number of small
entities.

Executive Order 12372

This program/activity is listed in the Catalog of Federal Domestic
Assistance under No. 10.025 and is subject to Executive Order 12372,
which requires intergovernmental consultation with State and local
officials. (See 7 CFR part 3015, subpart V.)

Executive Order 12988

This proposed rule has been reviewed under Executive Order 12988,
Civil Justice Reform. If this proposed rule is adopted: (1) All State
and local laws and regulations that are inconsistent with this rule
will be preempted; (2) no retroactive effect will be given to this
rule; and (3) administrative proceedings will not be required before
parties may file suit in court challenging this rule.

Paperwork Reduction Act

This proposed rule contains no new information collection or
recordkeeping requirements under the Paperwork Reduction Act of 1995
(44 U.S.C. 3501 et seq.).

List of Subjects

7 CFR Part 354

Exports, Government employees, Imports, Plant diseases and pests,
Quarantine, Reporting and recordkeeping requirements, Travel and
transportation expenses.

9 CFR Part 97

Exports, Government employees, Imports, Livestock, Poultry and
poultry products, Travel and transportation expenses.

9 CFR Part 130

Animals, Birds, Diagnostic reagents, Exports, Imports, Poultry and
poultry products, Quarantine, Reporting and recordkeeping requirements,
Tests.

Accordingly, we propose to amend 7 CFR part 354 and 9 CFR parts 97
and 130 as follows:

PART 354--OVERTIME SERVICES RELATING TO IMPORTS AND EXPORTS; AND
USER FEES

1. The authority citation for part 354 would continue to read as
follows:

Authority: 7 U.S.C. 8301-8317; 21 U.S.C. 136 and 136a; 49 U.S.C.
80503; 7 CFR 2.22, 2.80, and 371.3.

2. Section 354.1 would be amended as follows:
a. In paragraph (a)(1), introductory text, the table would be
revised to read as set forth below.
b. In paragraph (a)(1)(iii), the table would be revised to read as
set forth below.

354.1 Overtime work at border ports, sea ports, and airports.

(a)(1) * * *

Overtime for Inspection, Laboratory Testing, Certification, or Quarantine of Plant, Plant Products, Animals,
Animal Products or Other Regulated Commodities
----------------------------------------------------------------------------------------------------------------
Overtime rates (per hour)
Outside the employee's normal tour ---------------------------------------------------------------------------
of duty Oct. 1, 2002- Oct. 1, 2003- Oct. 1, 2004- Beginning Oct.
Sept. 30, 2003 Sept. 30, 2004 Sept. 30, 2005 1, 2005
----------------------------------------------------------------------------------------------------------------
Monday through Saturday and holidays $46.00 $48.00 $49.00 $51.00
Sundays............................. 61.00 63.00 65.00 67.00
----------------------------------------------------------------------------------------------------------------

* * * * *
(iii) * * *

Overtime for Commercial Airline Inspection Services \1\
----------------------------------------------------------------------------------------------------------------
Overtime rates (per hour)
Outside the employee's normal tour ---------------------------------------------------------------------------
of duty Oct. 1, 2002- Oct. 1, 2003- Oct. 1, 2004- Beginning Oct.
Sept. 30, 2003 Sept. 30, 2004 Sept. 30, 2005 1, 2005
----------------------------------------------------------------------------------------------------------------
Monday through Saturday and holidays $37.00 $39.00 $40.00 $41.00
Sundays............................. 49.00 51.00 53.00 55.00
----------------------------------------------------------------------------------------------------------------
\1\ These charges exclude administrative overhead costs.

[[Page 13867]]

* * * * *

PART 97--OVERTIME SERVICES RELATING TO IMPORTS AND EXPORTS

3. The authority citation for part 97 would continue to read as
follows:

Authority: 7 U.S.C. 8301-8317; 49 U.S.C. 80503; 7 CFR 2.22,
2.80, and 371.4.
4. Section 97.1 would be amended as follows:
a. In the introductory text of paragraph (a), the table would be
revised to read as set forth below.
b. In paragraph (a)(3), the table would be revised to read as set
forth below.

97.1 Overtime services relating to imports and exports.

(a) * * *

Overtime for Inspection, Laboratory Testing, Certification, or Quarantine of Animals, Animal Products or Other
Regulated Commodities
----------------------------------------------------------------------------------------------------------------
Overtime rates (per hour)
Outside the employee's normal tour ---------------------------------------------------------------------------
of duty Oct. 1, 2002- Oct. 1, 2003- Oct. 1, 2004- Beginning Oct.
Sept. 30, 2003 Sept. 30, 2004 Sept. 30, 2005 1, 2005
----------------------------------------------------------------------------------------------------------------
Monday through Saturday and holidays $46.00 $48.00 $49.00 $51.00
Sundays............................. 61.00 63.00 65.00 67.00
----------------------------------------------------------------------------------------------------------------

* * * * *
(3) * * *

Overtime for Commercial Airline Inspection Services \1\
----------------------------------------------------------------------------------------------------------------
Overtime rates (per hour)
Outside the employee's normal tour --------------------------------------------------------- Beginning Oct.
of duty Oct. 1, 2002- Oct. 1, 2003- Oct. 1, 2004- 1, 2005
Sept. 30, 2003 Sept. 30, 2004 Sept. 30, 2005
----------------------------------------------------------------------------------------------------------------
Monday through Saturday and holidays $37.00 $39.00 $40.00 $41.00
Sundays............................. 49.00 51.00 53.00 55.00
----------------------------------------------------------------------------------------------------------------
\1\ These charges exclude administrative overhead costs.

* * * * *

PART 130--USER FEES

5. The authority citation for part 130 would continue to read as
follows:

Authority: 5 U.S.C. 5542; 7 U.S.C. 1622 and 8301-8317; 21 U.S.C.
136 and 136a; 31 U.S.C. 3701, 3716, 3717, 3719, and 3720A; 7 CFR
2.22, 2.80, and 371.4

.6. Section 130.2 would be amended as follows:
a. In paragraph (a), the table would be revised to read as set
forth below.
b. In paragraph (b), the table would be revised to read as set
forth below.

Sec. 130.2 User fees for individual animals and certain birds
quarantined in APHIS-owned or -operated animal quarantine facilities,
including APHIS Animal Import Centers.

(a) * * *

------------------------------------------------------------------------
Daily user fee
-------------------------------------
Animal or bird Oct. 1, 2002- Beginning Oct.
Sept. 30, 2003 1, 2003
------------------------------------------------------------------------
Birds (excluding ratites and pet
birds imported in accordance with
Part 93 of this subchapter):
0-250 grams................... $1.50 $1.75
251-1,000 grams............... 5.50 5.75
Over 1,000 grams.............. 13.00 13.00
Domestic or zoo animals (except
equines, birds, and poultry):
Bison, bulls, camels, cattle, 100.00 102.00
or zoo animals...............
All others, including, but not 26.00 27.00
limited to, alpacas, llamas,
goats, sheep, and swine......
Equines (including zoo equines,
but excluding miniature horses):
1st through 3rd day (fee per 264.00 270.00
day).........................
4th through 7th day (fee per 191.00 195.00
day).........................
8th and subsequent days (fee 162.00 166.00
per day).....................
Miniature horses.................. 60.00 61.00
Poultry (including zoo poultry):
Doves, pigeons, quail......... 3.25 3.50
Chickens, ducks, grouse, 6.25 6.25
guinea fowl, partridge, pea
fowl, pheasants..............
Large poultry and large 14.00 15.00
waterfowl, including, but not
limited to game cocks, geese,
swans, and turkeys...........
Ratites:
Chicks (less than 3 months 9.00 9.25
old).........................
Juveniles (3 months through 10 14.00 14.00
months old)..................
Adults (11 months old and 26.00 27.00
older).......................
------------------------------------------------------------------------

[[Page 13868]]

(b) * * *

------------------------------------------------------------------------
Daily user fee
-------------------------------------
Bird or poultry (nonstandard Oct. 1, 2002-
housing, care, or handling) Sept. 30, 2003 Beginning Oct. 1,
2003
------------------------------------------------------------------------
Birds 0-250 grams and doves, $5.50 $5.75
pigeons, and quail...............
Birds 251-1,000 grams and poultry 13.00 13.00
such as chickens, ducks, grouse,
guinea fowl, partridge, pea fowl,
and pheasants....................
Birds over 1,000 grams and large 25.00 25.00
poultry and large waterfowl,
including, but not limited to
game cocks, geese, swans, and
turkeys..........................
------------------------------------------------------------------------

* * * * *
7. In Sec. 130.3, paragraph (a)(1), the table would be revised to
read as follows:

Sec. 130.3 User fees for exclusive use of space at APHIS Animal
Import Centers.

(a)(1) * * *

------------------------------------------------------------------------
Monthly user fee
-------------------------------------
Animal import center Oct. 1, 2002-
Sept. 30, 2003 Beginning Oct.
1, 2003
------------------------------------------------------------------------
Newburgh, NY:
Space A, 5,396 sq. ft. (503.1 $57,630 $59,254
sq. m.)......................
Space B, 8,903 sq. ft. (827.1 95,085 97,764
sq. m.)......................
Space C, 905 sq. ft. (84.1 sq. 9,666 9,938
m.)..........................
------------------------------------------------------------------------

* * * * *
8. In Sec. 130.4, the table would be revised to read as follows:

Sec. 130.4 User fees for processing import permit applications.

* * * * *

----------------------------------------------------------------------------------------------------------------
User fee
-------------------------------------
Service Unit Oct. 1, 2002-
Sept. 30, 2003 Beginning Oct. 1,
2003
----------------------------------------------------------------------------------------------------------------
Import compliance assistance:
Simple (2 hours or less)............... Per release.................. $68.00 $70.00
Complicated (more than 2 hours)........ Per release.................. 174.00 180.00
Processing an application for a permit to
import live animals, animal products or
byproducts, organisms, vectors, or germ
plasm (embryos or semen) or to transport
organisms or vectors \1\
Initial permit......................... Per application.............. 94.00 94.00
Amended permit......................... Per amended application...... 47.00 47.00
Renewed permit \2\..................... Per application.............. 61.00 61.00
Processing an application for a permit Per application.............. 322.00 322.00
to import fetal bovine serum when
facility inspection is required.
----------------------------------------------------------------------------------------------------------------
\1\ Using Veterinary Services Form 16-3, ``Application for Permit to Import or Transport Controlled Material or
Organisms or Vectors,'' or Form 17-129, ``Application for Import or In Transit Permit (Animals, Animal Semen,
Animal Embryos, Birds, Poultry, or Hatching Eggs).''
\2\ Permits to import germ plasm and live animals are not renewable.

9. In Sec. 130.6, paragraph (a), the table would be revised to
read as follows:

Sec. 130.6 User fees for inspection of live animals at land border
ports along the United States-Mexico border.

(a) * * *

------------------------------------------------------------------------
Per head user fee
-------------------------------------
Type of live animal Oct. 1, 2002-
Sept. 30, 2003 Beginning Oct. 1,
2003
------------------------------------------------------------------------
Any ruminants (including breeder $8.75 $9.00
ruminants) not covered below.....
Feeder............................ 2.50 2.50
Horses, other than slaughter...... 43.00 44.00
In-bond or in-transit............. 5.50 5.75
Slaughter......................... 3.75 3.75
------------------------------------------------------------------------

* * * * *
10. In Sec. 130.7, paragraph (a), the table would be revised to
read as follows:

[[Page 13869]]

Sec. 130.7 User fees for import or entry services for live animals at
land border ports along the United States-Canada border.

(a) * * *

----------------------------------------------------------------------------------------------------------------
User fee
-------------------------------------
Type of live animal Unit Oct. 1, 2002-
Sept. 30, 2003 Beginning Oct. 1,
2003
----------------------------------------------------------------------------------------------------------------
Animals being imported into the United
States
Breeding animals (Grade animals, except
horses):
Sheep and goats........................ Per head..................... $0.50 $0.50
Swine.................................. Per head..................... 0.75 0.75
All others............................. Per head..................... 3.25 3.25
Feeder animals:
Cattle (not including calves).......... Per head..................... 1.50 1.50
Sheep and calves....................... Per head..................... 0.50 0.50
Swine.................................. Per head..................... 0.25 0.25
Horses (including registered horses), other Per head..................... 28.00 29.00
than slaughter and in-transit.
Poultry (including eggs), imported for any Per load..................... 48.00 50.00
purpose.
Registered animals (except horses)......... Per head..................... 5.75 6.00
Slaughter animals (except poultry)......... Per load..................... 24.00 25.00
Animals transiting \1\ the United States:
Cattle................................. Per head..................... 1.50 1.50
Sheep and goats........................ Per head..................... 0.25 0.25
Swine.................................. Per head..................... 0.25 0.25
Horses and all other animals........... Per head..................... 6.75 6.75
----------------------------------------------------------------------------------------------------------------
\1\ The user fee in this section will be charged for in-transit authorizations at the port where the
authorization services are performed. For additional services provided by APHIS, at any port, the hourly user
fee rate in Sec. 130.30 will apply.

* * * * *
11. In Sec. 130.8, paragraph (a), the table would be revised to
read as follows:

Sec. 130.8 User fees for other services.

(a) * * *

* * * * *
12. Section 130.10 would be amended as follows:
a. In paragraph (a), the table would be revised to read as set
forth below.
b. In paragraph (b), the table would be revised to read as set
forth below.

Sec. 130.10 User fees for pet birds.

(a) * * *

(b) * * *

[[Page 13870]]

----------------------------------------------------------------------------------------------------------------
Daily user fee
-------------------------------------
Number of birds in isolette Oct. 1, 2002- Beginning Oct.
Sept. 30, 2003 1, 2003
----------------------------------------------------------------------------------------------------------------
1......................................................................... $9.00 $9.25
2......................................................................... 11.00 11.00
3......................................................................... 13.00 13.00
4......................................................................... 15.00 15.00
5 or more................................................................. 17.00 18.00
----------------------------------------------------------------------------------------------------------------

* * * * *
13. In Sec. 130.11, paragraph (a), the table would be revised to
read as follows:

Sec. 130.11 User fees for inspecting and approving import/export
facilities and establishments.

(a) * * *

----------------------------------------------------------------------------------------------------------------
User fee
-------------------------------------
Service Unit Oct. 1, 2002--
Sept. 30, 2003 Beginning Oct. 1,
2003
----------------------------------------------------------------------------------------------------------------
Embryo collection center inspection and Per year..................... $369.00 $380.00
approval (all inspections required during
the year for facility approval).
Inspection for approval of biosecurity Per inspection............... 977.00 977.00
level three laboratories (all inspections
related to approving the laboratory for
handling one defined set of organisms or
vectors).
Inspection for approval of pet food
manufacturing, rendering, blending, or
digest facilities:
Initial approval....................... For all inspections required 404.75 404.75
during the year.
Renewal................................ For all inspections required 289.00 289.00
during the year.
Inspection for approval of pet food
spraying and drying facilities:
Initial approval....................... For all inspections required 275.00 275.00
during the year.
Renewal................................ For all inspections required 162.00 162.00
during the year.
Inspection for approval of slaughter
establishment:
Initial approval (all inspections)..... Per year..................... 362.00 373.00
Renewal (all inspections).............. Per year..................... 314.00 323.00
Inspection of approved establishments,
warehouses, and facilities under 9 CFR
parts 94 through 96:
Approval (compliance agreement) (all Per year..................... 386.00 398.00
inspections for first year of 3-year
approval).
Renewed approval (all inspections for Per year..................... 223.00 230.00
second and third years of 3-year
approval).
----------------------------------------------------------------------------------------------------------------

* * * * *
14. Section 130.20 would be amended as follows:
a. In paragraph (a), the table would be revised to read as set
forth below.
b. In paragraph (b)(1), the table would be revised to read as set
forth below.

130.20 User fees for endorsing export certificates.

(a) * * *

------------------------------------------------------------------------
User fee
-------------------------------------
Certificate categories Oct. 1, 2002--
Sept. 30, 2003 Beginning Oct. 1,
2003
------------------------------------------------------------------------
Animal and nonanimal products..... $31.00 $32.00
Hatching eggs..................... 29.00 30.00
Poultry, including slaughter 29.00 30.00
poultry..........................
Ruminants, except slaughter 33.00 33.00
ruminants........................
Slaughter animals (except poultry 34.00 35.00
but including ruminants) moving
to Canada or Mexico..............
Other endorsements or 23.00 24.00
certifications...................
------------------------------------------------------------------------

* * * * *
(b)(1) * * *

[[Page 13871]]

------------------------------------------------------------------------
User fee
Number of tests or vaccinations -------------------------------------
and number of animals or birds on Oct. 1, 2002- Beginning Oct.
the certificate Sept. 30, 2003 1, 2003
------------------------------------------------------------------------
1-2 tests or vaccinations:
First animal.................. $74.00 $76.00
Each additional animal........ 4.25 4.25
3-6 tests or vaccinations:
First animal.................. 91.00 94.00
Each additional animal........ 7.00 7.25
7 or more tests or vaccinations:
First animal.................. 106.00 109.00
Each additional animal........ 8.25 8.50
------------------------------------------------------------------------

* * * * *
15. Section 130.30 would be revised to read as follows:
a. In paragraph (a), the table would be revised to read as set
forth below.
b. In paragraph (b), the table would be revised to read as set
forth below.

Sec. 130.30 Hourly rate and minimum user fees.

(a) * * *

------------------------------------------------------------------------
User fee
-------------------------------------
Oct. 1, 2002- Beginning Oct.
Sept. 30, 2003 1, 2003
------------------------------------------------------------------------
Hourly rate:
Per hour...................... $84.00 $84.00
Per quarter hour.............. 21.00 21.00
Per service minimum fee........... 24.00 25.00
------------------------------------------------------------------------

(b) * * *

------------------------------------------------------------------------
Premium rate user fee
-------------------------------------
Overtime rates (outside the Oct. 1, 2002-
employee's normal tour of duty) Sept. 30, 2003 Beginning Oct. 1,
2003
------------------------------------------------------------------------
Premium hourly rate Monday through
Saturday and holidays:
Per hour...................... $96.00 $100.00
Per quarter hour.............. 24.00 25.00
Premium hourly rate for Sundays:
Per hour...................... 108.00 112.00
Per quarter hour.............. 27.00 28.00
------------------------------------------------------------------------

* * * * *
16. In Sec. 130.50, paragraph (b)(3)(i), the table would be
revised to read as follows:

Sec. 130.50 Payment of user fees.

* * * * *
(b) * * *
(3) * * *
(i) * * *

----------------------------------------------------------------------------------------------------------------
Overtime rates (per hour)
---------------------------------------------------------------------------
Outside of the employee's normal Oct. 1, 2002- Oct. 1, 2003- Oct. 1, 2004-
tour of duty Sept. 30, 2003 Sept. 30, 2004 Sept. 30, 2005 Beginning Oct. 1,
2005
----------------------------------------------------------------------------------------------------------------
Rate for inspection, testing,
certification or quarantine of
animals, animal products or other
commodities: ³
Monday-Saturday and holidays.... $46.00 $48.00 $49.00 $51.00
Sundays......................... 61.00 63.00 65.00 67.00
Rate for commercial airline
inspection services: ⁴
Monday-Saturday and holidays.... 37.00 39.00 40.00 41.00
Sundays......................... 49.00 51.00 53.00 55.00
----------------------------------------------------------------------------------------------------------------
¹ Minimum charge of 2 hours, unless performed on the employee's regular workday and performed in direct
continuation of the regular workday or begun within an hour of the regular workday.
² When the 2-hour minimum applies, you may need to pay commuted travel time. (See Sec. 97.1(b) of this chapter
for specific information about commuted travel time.)
³ See Sec. 97.1(a) of this chapter or 7 CFR 354.3 for details.
⁴ See Sec. 97.1(a)(3) of this chapter for details.

[[Page 13872]]

* * * * *

Done in Washington, DC, this 18th day of March, 2003.
Kevin Shea,
Acting Administrator, Animal and Plant Health Inspection Service.
[FR Doc. 03-6797 Filed 3-20-03; 8:45 am]

BILLING CODE 3410-34-P