APHIS publishes final rule in Federal Register

The U.S. Department of Agriculture’s (USDA) Animal and Plant Health Inspection Service (APHIS) has published a final rule in the Federal Register that will recoup the costs of conducting agricultural quarantine inspections (AQI) at U.S. ports of entry. The final rule will be effective 60 days after the date of publication in the Federal Register. The docket is expected to be published in the Federal Register on Oct. 29 and be effective on Dec. 28.
The fee adjustment is based on an independent evaluation by a well-respected accounting firm with expertise in this area. The firm conducted an independent user fee review to determine the current cost of AQI activities and services as well as the future costs of providing these services. The potential changes to the AQI user fee structure were also subject to an economic analysis.
The fee adjustment is necessary, aligning the actual cost of providing the services with what the U.S. Government charges. APHIS and U.S. Customs and Border Protection (CBP) have made every effort to minimize the impact of fee changes on the U.S. economy and small businesses, and provided a fair and open comment process. This adjustment is necessary to sustain a robust AQI program. The AQI fee adjustments are consistent with the United States’ international trade obligations.
The final rule lowers inspection fees for international passengers and railcars, and increases inspection fees for commercial vehicles, commercial trucks, and commercial aircraft. The final rule also adds fees for the application and monitoring of phytosanitary treatments and the inspection of cruise ship passengers. Under the new fee schedule, the U.S. Government will recover approximately $113 million more in revenue each year, providing total estimated annual revenue of $748 million on over $2.7 trillion in commercial goods and tens of millions of air and sea passengers entering the United States each year. This increase will ensure the financial stability of the AQI program, while minimizing the impact of fee changes on the U.S. economy and small businesses.
Congress authorized the Secretary of Agriculture through the Food, Agriculture, Conservation, and Trade Act of 1990, to prescribe and collect user fees sufficient to cover the costs of providing AQI services. By this action, Congress intended to shift most of the program’s costs from taxpayers to the people and the goods that must be inspected upon arrival in the United States. In 2008, the General Accountability Office (GAO) found that the AQI program was operating in a deficit increasingly subsidized by taxpayers. GAO recommended and the Office of Management and Budget directed APHIS to conduct a thorough review of the fee schedule and propose adjustments to more fully cover the costs of providing AQI services, reducing the program’s reliance on taxpayer-funded appropriations. In response, APHIS engaged an independent accounting firm to provide a clear accounting of the actual costs to deliver AQI services and share recommendations for the fees. APHIS briefed stakeholders on the findings of the review and then developed a proposed rule that adjusted the user fees based on the actual costs of the services. APHIS published the proposed rule in April 2014 and took public comments on it for 90 days, holding several stakeholder meetings and listening sessions during the comment period.
APHIS carefully considered all of the public input it received on the proposed rule, and adjusted the final fees in response. As a result, certain fees are lower than what was proposed in April 2014; specifically, air passenger fees were lowered from $4 to $3.96, commercial truck fees from $8 to $7.55, commercial truck with transponder fees from $320 to $301.67, and cruise passenger fees from $2 to $1.75. APHIS kept those fees for commercial aircraft, commercial cargo vessels, and commercial cargo railcars at the 2014 proposed levels. In addition, APHIS also lowered the treatment fee from $375 to $237 and will phase it in over a 5-year period to help reduce the impact to small businesses. In the first year, the fee will be $47 and will increase gradually over 5 years until it reaches $237.
The AQI program plays a critical role in facilitating the safe trade of agricultural commodities while protecting U.S. agriculture and the environment from harmful plant and animal pests and diseases. APHIS and CBP work together to carry out AQI program activities. Under the program, APHIS tracks emerging and new pest situations around the world; assesses and analyzes pest risks and pest movements in trade; develops and applies methods to reduce pest risk and movement in trade; develops passenger and cargo targeting, sampling, and inspection protocols; inspects live plant shipments; and monitors and stops illegal movements of agricultural goods in foreign commerce. CBP conducts pre-arrival analysis, targeting, selectivity, and examination of international passengers’ baggage, commercial commodities, containers, commercial vessels, trucks, aircraft and railcars at U.S. ports of entry to determine compliance and entry status using APHIS’ regulatory protocols. The fee adjustments will strengthen the financial foundation of the AQI program, allowing APHIS and CBP to sustain a robust AQI program that is a vital component of safe global trade, while making sure inspection fees are fairly and consistently applied.
Please visit the APHIS AQI Web page to view the final rule and our frequently asked questions.