Montana Administrative Register Notice 4-14-218 No. 12   06/26/2014    
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BEFORE THE Department of agriculture



In the matter of the adoption of New Rule I pertaining to phytosanitary certification fees






TO: All Concerned Persons


1. On February 13, 2014 the Department of Agriculture published MAR Notice No. 4-14-218 pertaining to the public hearing on the proposed adoption of the above-stated rule at page 264 of the 2014 Montana Administrative Register, Issue Number 3.


2. The department has adopted the above-stated rule as proposed: New Rule I (4.12.1444).


3. The department has thoroughly considered the comments and testimony received. A summary of the comments received and the department's responses are as follows:


COMMENT #1: Why did the fee have to go up so much?


RESPONSE #1: The issuance of phytosanitary certificates is an entirely fee-for-service program and the proposed fees are required for the department to continue providing this service. The department should have raised the fees earlier but allowed them to remain lower than the true cost of the program. The increase is necessary to create a functioning program that does not need the support of other parts of the department to operate. Even with the increase it will likely need some support from other units to pay its portion of central service charges, but that support is appropriate given the value of encouraging exports.


COMMENT #2: Could the increase be phased in instead of one big jump?


RESPONSE #2: The current fee structure has been in place for a long time and the fee increases are long overdue based on the revenue needed to provide the service. Hopefully, one fee increase will provide budget stability for the department and projectable future costs for applicants. The department does not have alternative sources of adequate funding for this that would allow a phased approach.


COMMENT #3: Could the fee be based on the actual time spent instead of per document?


RESPONSE #3: Fees based on the issuance of the phytosanitary certificate are the simplest to manage by the applicant and department. This allows both to have predictable and standardized costs/revenue. Typically, small shipments require more time researching requirements and longer specialized inspections. If the fees were based on actual time required to issue the certificate, some small shipments would be charged certification fees far exceeding the value of the shipment.


COMMENT #4: Shouldn't the fee be based on the value of the item being sent, not per shipment (to be more supportive of smaller shipments/shippers)?


RESPONSE #4: The effort and costs associated with issuing an individual certificate are independent of the value of the shipment. The department has to be fair to all size of shippers and the value of the item shipped bears no relation to the cost or time required to create the phyosanitary (or related) documents.


COMMENT #5: Couldn't general funds be used to pay for this as that is how it is done in other states to encourage exports?


RESPONSE #5: General funds can only be authorized by the legislature. Commenters are welcome to seek such funds (which would lower the fee) in the next legislative session.


COMMENT #6:  With the fee increase will the program be self-sufficient and if so for how many years?


RESPONSE #6: The issuance of phytosanitary certificates is an entirely fee-for-service program and the proposed fees are required for the department to continue providing this service.  The proposed fees will meet the current budget projections through FY2015. The increased fees should provide budget stability for several years but cannot be guaranteed because future costs and the number of certificates requested can be unpredictable.


COMMENT #7: What about using part-time workers located near key shippers to lower costs?


RESPONSE #7: The department has eight field offices that provide services across the entire state.  Locations are based on the workload from all of the department's programs.  Plant science specialists that issue phytosanitary certificates are required to have specific educational and experience requirements and maintain certification through USDA Export Services.  The department has not been able to hire part-time seasonal personnel who are able to meet these requirements and maintain the required USDA certification.  This suggestion of part-time staff located next to big nurseries is not a realistic solution and likely is not a fair way to staff a state agency.



/s/ Cort Jensen                                            /s/ Ron de Yong                             

Cort Jensen                                                Ron de Yong

Rule Reviewer                                             Director

                                                                  Department of Agriculture


Certified to the Secretary of State June 16, 2014.


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