WSR 09-19-141

PROPOSED RULES

DEPARTMENT OF AGRICULTURE


[ Filed September 23, 2009, 7:48 a.m. ]

Original Notice.

Preproposal statement of inquiry was filed as WSR 09-14-121.

Title of Rule and Other Identifying Information: Chapter 16-470 WAC, Quarantine -- Agricultural pests, the department is proposing to increase laboratory diagnostic and postentry inspection fees, including hourly fees for these services. In addition, the department is amending the language in order to meet the needs of the affected stakeholders in response to recent changes in technology, procedures implemented by the federal government, and industry practices.

Hearing Location(s): Washington State Department of Agriculture, 1111 Washington Street S.E., Natural Resources Building, 2nd Floor, Conference Room 259, Olympia, WA 98504-2560, on October 29, 2009, at 1:00 p.m.

Date of Intended Adoption: November 5, 2009.

Submit Written Comments to: Henri Gonzales, P.O. Box 42560, Olympia, WA 98504-2560, e-mail hgonzales@agr.wa.gov, fax (360) 902-2094, by October 29, 2009.

Assistance for Persons with Disabilities: Contact Henri Gonzales by October 22, 2009, TTY (800) 833-6388.

Purpose of the Proposal and Its Anticipated Effects, Including Any Changes in Existing Rules: The department is proposing to increase laboratory diagnostic and postentry inspection fees, including hourly fees for these services. In addition, the department is amending the language in order to meet the needs of affected stakeholders in response to recent changes in technology (especially with regard to laboratory tests), procedures implemented by the United States Department of Agriculture's Animal and Plant Health Inspection Service, and industry practices.

Reasons Supporting Proposal: During the 2009 legislative session, the Washington state legislature authorized (as required by Initiative 960) the Washington state department of agriculture (WSDA) to increase the plant pest inspection and testing fees as necessary to meet the actual costs of conducting business (see chapter 564, Laws of 2009).

This rule establishes the fees-for-service charged by the plant services program and pest program for activities authorized in chapter 17.24 RCW. This increase in fees would enable the programs to cover the costs associated with these activities.

Statutory Authority for Adoption: RCW 17.24.021 and 17.24.131; chapter 34.05 RCW; and chapter 564, Laws of 2009.

Statute Being Implemented: RCW 17.24.021 and 17.24.131.

Rule is not necessitated by federal law, federal or state court decision.

Name of Proponent: Washington state department of agriculture, governmental.

Name of Agency Personnel Responsible for Drafting: Tom Wessels, 1111 Washington Street, Olympia, WA 98504-2560, (360) 902-1984; Implementation and Enforcement: Mary Toohey, 1111 Washington Street, Olympia, WA 98504-2560, (360) 902-1907.

A small business economic impact statement has been prepared under chapter 19.85 RCW.

Small Business Economic Impact Statement

Proposal: This proposal would increase the fees for requested inspection services and plant pathology testing performed under authority of chapter 17.24 RCW. In general, these are services and tests requested on a voluntary basis by persons who wish to export agricultural and related industry products, so that their shipments comply with the requirements of domestic and international markets. This is a companion to a proposal to increase fees for similar services authorized under authority of chapter 15.13 RCW and performed by the same program.

Rule Summary: RCW 17.24.131 authorizes the director to provide inspection and testing services to facilitate the movement of plant products and to establish a schedule of fees for those services. The fee schedule, established in chapter 16-470 WAC, includes fees for pest inspections, plant pathology testing, and other pest detection activities that may be necessary for the phytosanitary certification of plant products. The department certifies many commodities under chapter 17.24 RCW including: Logs, lumber, hay, grain, pulse crops, seed crops, and nursery stock. Among its several statutory responsibilities, the plant services program and associated plant pathology laboratories provide phytosanitary certification services upon request and deposit collected fees into accounts within the agriculture local fund. Table 1 lists the revenue collected for providing requested services under chapters 17.24 and 15.13 RCW in the previous biennium.


Table 1.
Account Biennium Revenue
Nursery inspection -- Requested services $1,115,018.79
Plant pathology lab -- Olympia $36,437.04
Plant pathology lab -- Prosser $75,481.03

RCW 17.24.131 requires the department to recover its costs for requested services, including salaries and expenses of personnel providing those services. Prior to 2007, the department was able to offset increasing salaries and expenses by implementing annual incremental fee increases within the mandated fiscal growth factor. However, enactment of Initiative 960 in 2007 prohibited state agencies from increasing fees without legislative authority. During the 2009 legislative session, the department was given authority to increase fees for these services and testing.

Approximately 89% of the revenue listed for the nursery inspection account in Table 1 above comes from requested services performed under chapter 17.24 RCW. The remainder is sourced from requested services performed under chapter 15.13 RCW, which is the subject of a separate rule proposal to increase fees. Without increases in revenue from both statutory sources, the nursery inspection fund balance is projected to be depleted by the end of the current biennium.

With the intention of stabilizing the nursery inspection account until approximately 2016, the department considered increasing fees by 32%. However, in view of the current economic turndown, the department decided to mitigate possible economic impacts by reducing the proposed increases substantially and reevaluating the program's financial status in 2010. Table 2 lists options for fee increases and the projected fund balances for the nursery inspection account (including all of its revenue streams) at the end of the current biennium.


Table 2.
Fee Increase Projected Fund Balance 6/30/2011
No fee increase ($11,723)
32% in January 2010 $473,737
16% in January 2010 $263,193

This proposal is for a 16% increase in fees for requested services. The proposed revision will result in no additional reporting, record-keeping, or other compliance requirements. Other than the increase in the fee itself, there are no additional equipment, supplies, labor, professional services, or increased administrative costs to small businesses associated with the proposal, and this proposal will not cause businesses to lose sales or revenue.

Affected Groups and Costs: The proposal to increase fees for requested services in chapter 16-470 WAC will affect all businesses requiring phytosanitary certification services under chapter 17.24 RCW for moving plant products. The WSDA has approximately three hundred customers requesting these services, including forest products companies, brokers, and growers. Hay, logs, lumber, and pulse crops make up the majority of certified products.

Table 3 lists the current and proposed fee schedules.


Table 3.
Service Current Fee Proposed Fee
Hourly rate-business hours $34.80 $40.00
Hourly rate-nonbusiness hours $44.45 $51.00
Certificate issued at time of inspection No charge No charge
Certificate issued more than twenty-four hours after the inspection $16.55 $19.50
Additional certificates $5.20 $6.50
Fumigation lot or container fee $13.80 $16.00
Nematode test (plant material) $36.15 $38.00
Nematode test (soil) $36.15 $60.00
Bunts and smuts $34.80 per hour $60.00
Compliance agreement $34.80 $40.00

Industry Outreach: Because of the diversity of customers requesting phytosanitary certification, the department will contact all customers individually. A letter explaining the proposal will be mailed along with their monthly statements to all accounts.

Alternatives: The alternative to increasing fees for requested services is to leave the current fees unchanged and reduce program staff and services. Without additional revenue, the department will not be able to provide phytosanitary certification services at the current level. Reduction in services would likely impede the ability of Washington exporters to move plant products in a timely fashion, not least by increasing turnaround times for certification services and potentially delaying movement of products through port facilities.

USDA Animal and Plant Health Inspection Service (APHIS) is an alternative source for some of these requested inspection services. Federal fees for these services are not directly comparable to the WSDA hourly fee, as APHIS charges by the certificate, rather than by the hour. However, the current federal fee of $98 per certificate appears to be approximately 1.5x to double the proposed state fee for the same service. In addition, some services performed by WSDA are not offered by APHIS.

Conclusion: The fees generated by requested services fund a significant portion of the department's nursery inspection account and associated plant pathology testing. The plant services program is mandated by chapter 17.24 RCW to facilitate the movement of plant products through special certifications and to charge a fee for those services that is adequate to recover the cost of providing those services. To maintain the current level of services, a fee increase in requested services is necessary.

A copy of the statement may be obtained by contacting Henri Gonzales, P.O. Box 42560, Olympia, WA 98504-2560, phone (360) 902-2061, fax (360) 902-2094, e-mail hgonzales@agr.wa.gov.

A cost-benefit analysis is not required under RCW 34.05.328. The WSDA is not a listed agency under RCW 34.05.328 (5)(a)(i).

September 23, 2009

Mary A. Martin Toohey

Assistant Director

OTS-2622.3


AMENDATORY SECTION(Amending WSR 07-11-012, filed 5/3/07, effective 7/1/07)

WAC 16-470-912   Schedule of fees and charges -- Applicable fees and charges.   (1) Hourly rate.


Hourly rate - business hours (($34.80)) $40.00
Hourly rate - nonbusiness hours (($44.45)) $51.00

(2) Laboratory diagnostic services, except as provided in subsection (3) or (4) of this section, are charged at the applicable hourly rate plus materials.

(3) ((Nematology)) Plant pathology laboratory diagnostic fees ((are as follows)):


((Identity Determination 1 sample 5 samples 10 samples 50 samples 100+ samples
nematode 36.15 ea 33.30 ea 30.55 ea 29.80 ea 27.75 ea))

(a) Nematode assay (plant material) . . . . . . . . . . . . $38.00

(b) Nematode assay (soil) . . . . . . . . . . . . $60.00

(c) Assay for dwarf bunt (TCK), Karnal bunt, flag smut

. . . . . . . . . . . . $60.00


Note: ((To receive volume rates, samples must be submitted as a unit and identification requests must be for one specific nematode, unless more than one nematode can be detected in a single test without additional inputs.)) Fee is for one sample for one specific organism, unless more than one organism can be detected in a single test without additional inputs.

(4) The department reserves the right to provide service by written agreement at a single, negotiated cost or at a negotiated rate for projects with at least one of the following characteristics:

(a) Projects greater than one hundred samples;

(b) Projects requiring materials not readily available; or

(c) Projects requiring special handling, multiple phase test procedures, or prolonged incubation periods.

The rate charged shall not be less than the cost to the department of performing the tests.

[Statutory Authority: Chapters 17.24 and 34.05 RCW. 07-11-012, 16-470-912, filed 5/3/07, effective 7/1/07; 06-15-044, 16-470-912, filed 7/11/06, effective 8/11/06; 05-12-111, 16-470-912, filed 5/31/05, effective 7/1/05. Statutory Authority: Chapters 17.24, 15.14, and 34.05 RCW. 05-01-180, 16-470-912, filed 12/21/04, effective 1/21/05. Statutory Authority: Chapters 17.24 and 34.05 RCW. 04-17-036, 16-470-912, filed 8/10/04, effective 9/10/04. Statutory Authority: Chapters 15.13, 15.14, 17.24, and 34.05 RCW. 03-21-166, 16-470-912, filed 10/22/03, effective 11/22/03. Statutory Authority: Chapters 17.24 and 34.05 RCW. 03-10-082, 16-470-912, filed 5/6/03, effective 6/30/03. Statutory Authority: Chapters 17.24 and 15.14 RCW. 01-11-033, 16-470-912, filed 5/8/01, effective 6/8/01.]


AMENDATORY SECTION(Amending WSR 07-11-012, filed 5/3/07, effective 7/1/07)

WAC 16-470-917   Schedule of fees and charges -- Fees for post entry inspection services.   (1) Post entry site inspection and/or permit review and approval . . . . . . . . . . . . (($69.85)) $81.00

(2) Subsequent inspections of post entry plant materials are provided at the applicable hourly rate.

(3) Post entry inspection fees may be waived for state universities, United States Department of Agriculture researchers, and other public entities.

[Statutory Authority: Chapters 17.24 and 34.05 RCW. 07-11-012, 16-470-917, filed 5/3/07, effective 7/1/07; 06-15-044, 16-470-917, filed 7/11/06, effective 8/11/06; 05-12-111, 16-470-917, filed 5/31/05, effective 7/1/05; 04-17-036, 16-470-917, filed 8/10/04, effective 9/10/04. Statutory Authority: Chapters 15.13, 15.14, 17.24, and 34.05 RCW. 03-21-166, 16-470-917, filed 10/22/03, effective 11/22/03. Statutory Authority: Chapters 17.24 and 34.05 RCW. 03-10-082, 16-470-917, filed 5/6/03, effective 6/30/03. Statutory Authority: Chapters 17.24 and 15.14 RCW. 01-11-033, 16-470-917, filed 5/8/01, effective 6/8/01.]


AMENDATORY SECTION(Amending WSR 03-10-082, filed 5/6/03, effective 6/30/03)

WAC 16-470-921   Schedule of fees and charges -- Miscellaneous fees.   (1) Mileage at the established office of financial management rate (schedule A), per diem and other authorized travel expenses at actual cost, and travel time at the applicable hourly rate may be assessed for requested inspections or post entry inspections that are not a part of a regular work schedule. Such charges may be prorated among applicants if more than one applicant is provided service during a workday or trip when per diem is applicable.

(2) Postage, special handling services and other miscellaneous costs exceeding five dollars will be charged back to the applicant at the actual cost.

(3) Certificates of inspection, phytosanitary certificates, and other official documents will be provided to the applicant subject to the charges and conditions established in chapter 16-401 WAC.

[Statutory Authority: Chapters 17.24 and 34.05 RCW. 03-10-082, 16-470-921, filed 5/6/03, effective 6/30/03. Statutory Authority: Chapters 17.24 and 15.14 RCW. 01-11-033, 16-470-921, filed 5/8/01, effective 6/8/01. Statutory Authority: Chapter 17.24 RCW. 99-12-035, 16-470-921, filed 5/26/99, effective 6/26/99.]

Washington State Code Reviser's Office