USDA finalizes formula to calculate FGIS supervision fees
The U.S. Department of Agriculture’s Agricultural Marketing Service (AMS) published a final rule on Sept. 3 to implement a standardized formula for calculating Federal Grain Inspection Service (FGIS) supervision fees.
The change will enable FGIS to adjust supervision fees annually in order to maintain an appropriate operating reserve as required by the United States Grain Standards Act (USGSA). The Agriculture Reauthorizations Act of 2015 (Reauthorization) amended the USGSA to require FGIS to adjust fees for the supervision of official grain inspection and weighing in order to maintain an operating reserve between three and six months.
The new formula goes into effect on Oct. 1, which is the start of fiscal year 2022. Fees for FY22 will be based on the five-year rolling average of the amount of grain officially inspected and weighed in FY16-FY20 by delegated States and Officially designated agencies. NGFA and NAEGA had advocated for this “five-year rolling average formula” to be included in the Reauthorization. This is the same formula that is used to calculate national and local export tonnage fees on an annual basis.
At the end of FY16, FGIS reviewed their operating reserve to determine that the Supervision of Official Agencies account exceeded six months by a significant margin and that a suspension of fees would “not impair the objectives of the USGSA because the operating reserve for supervision services is sufficient to maintain the service without additional funds.” As a result, the agency has suspended the assessment fee of $0.011 per metric ton of domestic shipments since July 1, 2017.