Under the 2015 reauthorization of the US Grain Standards Act, two actions were required of the Secretary of Agriculture with respect to fees for official inspection and weighing. One action is that all fees related to official inspection and weighing services must be adjusted at least annually to maintain a 3-to-6-month operating reserve, with adjustments being made based on a target operating reserve of 4.5 months[1]. The other is that the export tonnage fees for official inspection and weighing must be based on the rolling 5-year average of export tonnage volumes[2]. The tonnage fee is intended to cover administrative costs (national and local)[3] for official inspection and weighing services.
FGIS implemented the two fee actions on a calendar year basis beginning January 1, 2017. Since implementation of the new calculation for export tonnage fees, FGIS’s operating reserve has been steadily decreasing (negative trendline). At the same time, the national administrative costs for official inspection and weighing services has also been decreasing (negative trendline). Also during this time, published tonnage fee adjustments have ranged from 5% decreases to 5% increases, with 5% increases in each of the last three years. With national administrative costs decreasing, national tonnage fees increasing in the last three years, and the operating reserve continuing on a negative trendline, this suggests that a more in-depth review of tonnage fees as well as an overall review of FGIS obligations (expenses) is needed. In order to help provide input to FGIS, the GIAC, as well as interested stakeholders, need additional, detailed information on FGIS revenues and obligations (expenses).
Additionally, the timeliness with which annual adjustments to fees are made and published in the Federal Register needs to be reviewed. Current understanding is that fees are reviewed and calculations for any adjustments are completed after the end of the fiscal year (September 30), with the intent that new fee schedules are published at the beginning of the next calendar year (on or about January 1). Since the implementation of the new tonnage fee calculation (January 1, 2017), new fee schedules have been published as early as December 30 (2016) and as late as March 29 (2023). Having revised fees published in a timely manner is important for users of the official system for managing their budgets. When publication of new fee schedules is delayed, users of the official system cannot make informed decisions on managing expenses for official inspection and weighing services.
The GIAC request FGIS provide in-depth information on user fees, other revenue, and obligations (expenses) during the next meeting.