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Adjustment of Certain Fees of the Immigration Examinations Fee Account [63 FR 43604] [ FR 63-98]
FEDERAL REGISTER CITE:
63 FR 43604
DATE OF PUBLICATION:
August 14, 1998
BILLING CODE 4410-10
DEPARTMENT OF JUSTICE
Immigration and Naturalization Service
8 CFR Part 103
[INS No. 1768-98; AG No. 2173-98]
Adjustment of Certain Fees of the Immigration
Examinations Fee Account
Immigration and Naturalization Service, Justice.
This rule adjusts the fees schedule of the Immigration Examinations Fee Account (IEFA) for certain immigration adjudication and naturalization applications and petitions. Fees collected from persons filing these applications and petitions are deposited into the IEFA and used to fund the cost of processing immigration adjudication and naturalization applications and petitions and associated support services; the cost of providing similar services to asylum and refugee applicants; and the cost of similar serv
ices provided to other immigrants at no charge. This rule ensures that the fees that fund the IEFA generate sufficient revenue to recover the full cost of processing immigration adjudication and naturalization applications and petitions, and the cost of asylum, refugee, and other immigrant services provided at no charge to the applicant.
This final rule is effective October 13, 1998, except the Form N-400 (fee increase) contained in the table in Section 103.7(b)(1), which will take effect on January 15, 1999.
FOR FURTHER INFORMATION CONTACT:
Michael T. Natchuras, Chief, Fee Policy and Rate Setting Branch, Office of Budget, Immigration and Naturalization Service, on (202) 616-2754, or Charles J. Yaple, Senior Staff Accountant, Fee Policy and Rate Setting Branch, Office of Budget, Immigration and Naturalization Service, on (202) 305-0020, or in writing at 425 I Street, NW., Room 6240, Washington, DC 20536.
The Immigration and Naturalization Service (Service) published a proposed rule in the
on January 12, 1998, at 63 FR 1775, to adjust the current Immigration Examinations Fee schedule. The fee adjustment is needed to comply with specific Federal immigration laws and the Federal user fee statute and corresponding regulations, which require Federal agencies to charge a fee for services when such services provide benefits to recipients that do not accrue to the public at large. The revised fees are calculated to recover the costs of providing these special services and benefits. The proposed rul
e was published with a 60-day comment period, which closed on March 13, 1998. The Service received 2,033 comments pertaining to the increases to the fees of the IEFA.
Comments were received from a broad spectrum of individuals and organizations, including 26 refugee and immigrant service organizations, 20 community literacy collaboratives, 45 public policy and advocacy groups, 49 religious affiliated agencies, 10 attorney organizations, 717 past and present adopting parents, and 1,127 concerned or prospective citizens. All of the comments were carefully considered before preparing this final rule. The following is a discussion of these comments and the Service's response
II. Summary of Comments
A. Form I-600/600A, Petition to Classify an Orphan as an Immediate Relative and Form N-643, Application for Certification of Citizenship-Adopted Child
Seven hundred and seventeen comments were received from prior or prospective adopting parents expressing dissatisfaction with the fee increases associated with Forms I-600 and I-600A, Petition to Classify an Orphan as an Immediate Relative, and the Application for Advance Processing of Orphan Petition, respectively, and Form N-643, Application for Certificate of Citizenship-Adopted Child. All 717 comments received were similar in nature. The commenters felt that these fees discriminated against American cit
izens who wished to adopt abandoned children living in orphanages around the world.
The Commissioner has always placed a very high priority on expediting international adoption applications. Each office must have at least one designated adjudicator to process international adoption applications. At most offices, the adjudicator receives the application directly. The international adoption process is labor intensive and generates a considerable amount of direct case interaction and correspondence.
The Fee Study Team documented the process and performed cycle time analysis for Forms I-600 and N-643, to accurately identify the costs associated with the processing of these specific petitions. The observations show that the processing of these petitions was particularly labor intensive and required the constant attention of adjudicators and others assigned to these cases.
Eighty percent of the applicants have numerous questions and contact the adjudicator with inquiries and requests for information before the initial submission of their application. Ninety percent of the applications are delivered in person, which leads to an extensive question and answer period between the applicant and the adjudicator. For instance, the average time needed for receipt of the other applications and petitions is slightly less than 5 minutes each. However, for the Form I-600/I-600A, the recei
pt cycle time is greater than 49 minutes because of the questions and concerns of the applicant.
Since the Service does not receive any appropriated funding (tax dollars) to cover the cost of processing applications and petitions for any naturalization or immigration benefit, the increase in fees is necessary to recover the full costs associated with processing international adoption applications.
B. Form N-400, Application for Naturalization
Twelve hundred and ninety-eight comments were received opposing the increase in the fee for the Form N-400, Application for Naturalization. Most of the comments began by stating that the proposed fee increase from $95 to $225 would create a hardship for most immigrant families because their family income is relatively low. One hundred and twenty-one of the commenters also specifically referenced the Commissioner's remarks that no fee increases would be implemented until the Service made progress in improvin
g naturalization processing.
The Service has made significant progress and remains committed to fulfilling the Commissioner's pledge regarding the naturalization program. Currently, efforts are underway to address naturalization processing, with teams assisting field offices in achieving increased levels of productivity. In addition, the Service has already opened 128 co-located and storefront Application Support Centers (ASC), and established 35 mobile ASC routes and 41 designated state or local law enforcement agencies nationwide to
facilitate the fingerprinting of applicants. Further, since April 15, 1998, the Service has fully implemented the Direct Mail program, with all Form N-400s being filed by mail at one of the Service's four highly automated service centers. Finally, the Service has installed the Computer Linked Application Information Management System 4.0 (CLAIMS) at all four Service Centers, with scheduled implementation at the larger district offices by the end of 1998.
Although the Service has made substantial progress in naturalization processing, the Commissioner has decided to change the effective date for the Form N-400, Application for Naturalization, fee increase to January 15, 1999, to permit the full implementation of the Service's plan to address naturalization processing.
C. Applicant Fees Should Not Pay for Unrelated Expenses or Atypical Costs
Fifty-one of the commenters opposed the use of the applicants fees to pay for expenses that they perceived to be for unrelated services such as the running of the asylum, refugee, and parole, and humanitarian affairs (formerly the Cuban-Haitian Entrant Program) programs. In the Departments of Commerce, Justice, and State, the Judiciary, and Related Agencies Appropriations Act, 1991 (Pub. L. 101-515), Congress authorized the Service to provide certain immigration adjudication and naturalization services at n
o cost to the applicants. Public Law 101-515 states that "fees for providing adjudication and naturalization services may be set at a level that will ensure recovery of the full costs of providing all such services, including the costs of similar services provided without charge to asylum applicants or other immigrants. Such fees may also be set at a level that will recover any additional costs associated with the administration of the fees collected [8 U.S.C. 1356(m)]." As a result of this legislation, Con
gress no longer provided the Service with an appropriation to cover the costs of asylum and refugee services, and directed the Service to fund these costs with revenue from the IEFA.
In FY 1996, Congress also authorized the Service to pay for the cost of the Cuban-Haitian Entrant Resettlement Program from the IEFA. In FY 1997, Congress transferred the cost of other asylum and refugee services that had been paid from the Violent Crime Trust Fund to the IEFA. Through explicit legislative language and subsequent appropriation action, Congress has signaled its desire that certain asylum and refugee services should be provided at no charge to the recipient. The revenue to pay for these costs
must be recovered from the fees charged to other applicants for immigration adjudication and naturalization benefits. All expenses being included for cost recovery are consistent with Federal law and Federal accounting standards.
Many of these commenters also opposed the Service paying for costs that are unusual or atypical when compared to the usual costs in a normal processing year. They claimed that the type of organizational activities that the Service is currently engaged in, such as infrastructure building, should not be funded by current applications and must not be included in the fee calculation. Proper accounting treatment requires inclusion of unusual or atypical costs, such as improvement of automation activities or upgr
ading of records management. These types of costs were assigned a useful life and the cost of these projects amortized or depreciated over the assigned useful life. Therefore, a portion of the unusual or atypical cost has been included in the fee calculation framework for the current year and treated like any other cost based on the useful life assigned to that asset.
D. The Service Should Seek Additional Sources for Funding Certain Adjudications Functions From Congress
Fifty of the commenters encouraged the Service to seek additional sources of funding from Congress for certain adjudications functions. Since FY 1989, the fees collected and deposited into the Examinations Fee Account have been the sole source of funding for immigration adjudication and naturalization services. In creating the IEFA, the Congress intended that this account be self-sustaining, and not be funded by tax dollars. The Service has been managing this account consistent with Federal law and Congress
In addition, the commenters felt that the Service should seek action from Congress that would end the practice of taking 245(i) fee money out of the IEFA and redirecting it to detention-related activities. The commenters felt adjudication services were being provided with respect to 245(i) activities and, thus, fees submitted in connection with a 245(i) adjustment application should remain in the IEFA, which is the funding source for immigration adjudication and naturalization services. Detention-related ac
tivities, the commenters noted, should be funded with appropriated funds. The Service will take these comments under advisement. However, since the drafting of the proposed rule, it is noted that Congress has enacted legislation which has reinforced its intent that 245(i) fee money (Pub. L. 105-119) not be deposited in the IEFA.
Finally, these commenters addressed the requirement that Congressional notification is needed whenever a reprogramming of more than $500,000 or 10 percent of the change in the net total of any program activity's approved budget is to take place. The Service is only required to provide notice to Congress; however, the commenters felt the Service has adopted a policy in which it does not spend the funds until the change is approved by Congress. The Service, per Department of Justice policy, only takes action
under the protocol that Congress has established, which requires Congressional approval before spending authorities can be changed.
E. The Level of Service Provided at Each Office Should Be Consistent Nationwide
Sixty-six of the commenters opposed increasing fees when service varies so greatly from office to office. The proposed fees were developed on a nationwide basis based on the identified resources needed to produce specific goods or services. The Service matched the resources needed to receive and to process the new applications/petitions with the workload expected to be received in FY 1998. The process was consistently applied for all applications and petitions. However, the Service is currently reviewing th
e workloads in the various district offices in an effort to balance waiting times.
F. The Service Should Consider Gradual or Phased-in Fee Increases
Eighteen commenters recommended that fees be gradually phased in over a 3-year period. The Service agrees that this may be a useful approach in the future, and will study this course of action. However, fees have not been increased since July 14, 1994, and, based upon projected fee revenues and corresponding cost estimates, the Service projects a shortfall in revenue. Currently, the Service cannot gradually increase fees over a 3-year period without jeopardizing the financial solvency of the entire account.
This rule is necessary to ensure that the fees that fund the IEFA generate sufficient revenue to recover the full cost of processing immigration adjudication and naturalization applications and petitions, including the costs of similar services provided at no charge to asylum applicants or other immigrants.
G. Fee Calculation Methodology
Thirty-three of the commenters objected to the methodology used to calculate the proposed fees. More specifically, the cost modeling convention records events "as is," not "as should be." Some of the commenters felt that the Activity Based Costing methodology calculated fees based upon inefficient practices.
The Fee Account Study adhered to the guidance contained in the Office of Management and Budget (OMB) Circular A-25, User Charges, which requires that user charges imposed recover the full cost to the Government for providing a special benefit. In addition, the Federal Accounting Standards Advisory Board (FASAB) provides additional guidance on the meaning of full-cost recovery. In FASAB Statement No. 4, full cost is defined as:
The total amount of resources used to produce the output. This includes direct and indirect costs that contribute to the output regardless of funding sources. It also includes costs of supporting services provided by other responsibility segments or entities.
The fees reflect the current cost of processing applications and petitions at the time of the fee study. The study was conducted consistent with the requirements of the Chief Financial Officers Act of 1990, which requires a biennial review of user fees to ensure that full costs are being recovered.
H. Form I-539, Application To Extend Status-Change Nonimmigrant Status; Form I-129H, Petition To Classify Nonimmigrant as a Temporary Worker; Form I-140, Immigrant Petition for Foreign Worker; Form I-485, Application To Register Permanent Status or Adjust Status; Form I-765, Application for Employment Authorization; Form I-612, Application for Waiver of Foreign Residence Requirement
Comments were received from two universities opposing the fee increases for petitions frequently filed by international students, faculty, and staff. The first commenter opposed the fee increases for the Form I-539, Form I-129H, Form I-140, Form I-612, and the Form I-765 because they would impose an unacceptable financial burden upon the recipients. The second commenter objected to the fee increases until service improved and recommended waiving the fees, specifically the fee for the Form I-765, because of
economic necessity. There are provisions in 8 CFR 103.7(c) that provide for waiver of fees if certain conditions are met. The Service often waives fees for this application when the economic need exists. The proposed rule stated, "For FY 1998, the Service estimates that approximately 50 percent of the Form I-765 applications will be processed at no charge to applicants, at a total cost of $35.9 million."
The fee increases on which these commenters were voicing opposition resulted from a comprehensive examination of costs associated with application and petition processing. As previously stated, the Service is required to review the fee structure, and to ensure that the full costs of providing special benefits to identifiable recipients be recovered by the Federal Government. Accordingly, these fees must be increased to recover costs.
I. Waiver/Exempt Costs
In the proposed rule, it was indicated that the Service is currently evaluating under what conditions a waiver of any fee should be granted. The proposed rule specifically sought comments on setting standards for application fee waivers. One hundred and nineteen commenters responded to this solicitation. These commenters agreed that a waiver policy and a standard waiver form were desirable. Twenty-nine commenters suggested that a "means test" be used to determine if an applicant qualifies for a fee waiver.
The Service will take this information under advisement during its ongoing review of this matter.
Presently, the Service grants case-specific fee waivers and will continue to grant case-specific fee waivers in the future. The purpose of the revision of the existing fee waiver regulation is to remedy the inconsistent manner in which fee waiver requests are presently being adjudicated nationwide. To address this situation, the Service is presently developing interim fee waiver standards that will be distributed to the field in the form of field guidance. The following proposals for granting fee waivers ar
e under review: establishment of a "fee cap" limiting total costs for families filing multiple applications, consideration of whether the applicant participates in certain means-tested public assistance programs, and consideration of special, humanitarian circumstances. Distribution of the guidance will coincide with the implementation of this rule. After distribution of the field guidance, a Financial Impact Assessment will be performed to develop a fee waiver policy that is equitable to the applicant and
feasible within the financial realities of the reimbursements needed to fund the program. The Service plans to publish an interim rule on the new fee waiver policy on July 1, 1999, and a final rule on the subject on October 1, 1999.
J. Assignment of Waiver/Exempt Costs and Asylum and Refugee (International Affairs) Surcharge
In the proposed rule, the Service highlighted the methodology used to assign costs for waiver/exempt costs and an asylum and refugee surcharge. The Service specifically sought comments on whether a flat rate or a percentage should be used to assign costs related to the surcharge applications and petitions for which the fees are waived. No comments were received on this question. Accordingly, the Service will continue to assign its waiver/exempt costs and surcharge as a flat percentage of each application's
or petition's processing costs.