Authorizing Collection of the Fee Levied on F, J, and M Nonimmigrant Classifications Under Public Law 104-208; SEVIS [69 FR 39814] [FR 18-04]

DOCUMENT NUMBER: FR 18-04

FEDERAL REGISTER CITE: 69 FR 39814

DATE OF PUBLICATION: July 1, 2004

BILLING CODE: 4410-10

DEPARTMENT OF HOMELAND SECURITY

8 CFR Parts 103, 214, and 299

[ICE No. 2297-03]

RIN 1653-AA23

Authorizing Collection of the Fee Levied on F, J, and M Nonimmigrant Classifications Under Public Law 104-208; SEVIS

AGENCY: Bureau of Immigration and Customs Enforcement, DHS.

ACTION: Final rule.

SUMMARY: On October 26, 2003, the Department of Homeland Security (DHS) published a proposed rule in the Federal Register, to implement section 641 of the Illegal Immigration Reform and Immigrant Responsibility Act of 1996 (IIRIRA), requiring the collection of information relating to nonimmigrant foreign students and exchange visitors, and providing for the collection of the required fee to defray the costs.

This rule amends the DHS regulations to provide for the collection of a fee to be paid by certain aliens who are seeking status as F-1, F-3, M-1, or M-3 nonimmigrant students or as J-1 nonimmigrant exchange visitors. Generally, the rule levies a fee of $100, although applicants for certain J-1 exchange visitor programs will pay a reduced fee of $35, and certain other aliens will be exempt from the fee altogether. This final rule explains which aliens will be required to pay the fee, describes the consequenc es that an alien seeking F-1, F-3, M-1, M-3, or J-1 nonimmigrant status faces upon failure to pay the fee, and specifies which aliens are exempt from the fee. This fee is being levied on aliens seeking F-1, F-3, M-1, M-3, or J-1 nonimmigrant status to cover the costs of administering and maintaining the Student and Exchange Visitor Information System (SEVIS), which includes ensuring compliance with the system's requirements by individuals, schools, and exchange visitor program sponsors. The fee will also pa y for the continued operation of the Student and Exchange Visitor Program (SEVP) and offset the resources to ensure compliance with SEVIS requirements, including funds to hire and train SEVIS Liaison Officers and other Bureau of Immigration and Customs Enforcement (ICE) officers.

The rule will be effective on September 1, 2004, and will apply to potential nonimmigrants who are initially issued a Form I-20 or Form DS-2019 on or after that date. Potential nonimmigrants, for purposes of this rule, are those aliens who will apply to the Department of State (DOS) or DHS for initial attendance as an F, M, or J nonimmigrant, certain nonimmigrants in the United States that will apply for a change of status to an F, M, or J classification, and current J-1 nonimmigrants that will apply for a J-1 category change on or after that date. If a Form I-20 or Form DS-2019 for initial status in a new program is issued on or after the effective date, the nonimmigrant traveling on that document will be required to pay the fee. Applicants, schools, and exchange visitor program sponsors should refer to the fee pay table contained in this rule for more detailed information concerning when a fee is required.

DATES: This final rule is effective September 1, 2004.

FOR FURTHER INFORMATION CONTACT: Jill Drury, Director'Student and Exchange Visitor Program (SEVP), Bureau of Immigration and Customs Enforcement, Department of Homeland Security, 800 K Street, NW., Room 1000, Washington, DC 20536, telephone (202) 305-2346.

SUPPLEMENTARY INFORMATION:

Background

On March 1, 2003, the former Immigration and Naturalization Service (Service) transferred from the Department of Justice to DHS pursuant to the Homeland Security Act of 2002 (HSA), Public Law 107-296, 116 Stat. 2135 (November 25, 2002). The Service's adjudication functions transferred to the Bureau of Citizenship and Immigration Services (CIS), and the Service's SEVIS function transferred to the Bureau of Border Security, now the Bureau of Immigration and Customs Enforcement (ICE). For the sake of simplicit y, any reference to the Service has been changed to DHS, even when referencing events that preceded March 1, 2003.

What Are SEVP, SEVIS, and the SEVIS Fee ?

Section 641 of the Illegal Immigration Reform and Immigrant Responsibility Act of 1996, Public Law No. 104-208, 110 Stat. 3546 (September 30, 1996), codified at 8 U.S.C. 1372, required the creation of a program to collect information relating to nonimmigrant foreign students and exchange visitor program participants during the course of their stay in the United States, using electronic reporting technology to the fullest extent practical. While the pilot program initially involved a small number of schools, the program has been expanded and fully implemented to cover all DHS-approved schools and DOS-designated exchange visitor program sponsors that enroll foreign nationals. The program became known as SEVP, and its core technology became known as SEVIS. The substantive requirements and procedures for SEVIS have been promulgated in separate rulemaking proceedings. See 67 FR 34862 (May 16, 2002, proposed rule for implementing SEVIS); 67 FR 44343 (July 1, 2002, interim rule for schools to apply for preliminary e nrollment in SEVIS); 67 FR 60107 (September 25, 2002, interim rule for certification of schools applying for enrollment in SEVIS); 67 FR 76256 (December 11, 2002, DHS's final rule implementing SEVIS); and 67 FR 76307 (December 12, 2002, DOS interim final rule implementing SEVIS). Under section 442(a)(4) of the HSA, as amended, responsibility over SEVIS specifically transferred to ICE. Section 641(e) of IIRIRA requires that a fee be established and charged to aliens tracked in SEVIS to fund the program, and further requires that the fee be used only for SEVP related purposes. Consistent with this mandate, a sub-account will be created within the Immigration Examination Fee Account into which SEVIS fees will be deposited and maintained for exclusive use related to SEVP.

Who Are the Nonimmigrants Affected by IIRIRA Section 641 ?

The Immigration and Nationality Act (Act) provides for the admission of different classes of nonimmigrant aliens, who are foreign nationals seeking temporary admission to the United States. The purpose of the alien's intended stay in the United States determines his or her proper nonimmigrant visa classification. Some visa classifications permit the nonimmigrant's spouse and qualifying children to accompany the nonimmigrant to the United States, or to join the nonimmigrant who is already in the United State s. To qualify, the alien's child must be unmarried and under the age of 21.

F-1 nonimmigrants, as defined in section 101(a)(15)(F) of the Act, are foreign nationals who come to the United States as foreign students to pursue a full course of study in DHS-approved colleges, universities, seminaries, conservatories, academic high schools, private elementary schools, other academic institutions, or in language training programs in the United States. For the purposes of this rule, the term “school” refers to all of these types of DHS-approved institutions. Generally, F-1 nonimmigrants are subject to the SEVIS fee and monitoring in SEVIS. An F-2 nonimmigrant is a foreign national who is the spouse or qualifying child of an F-1 student. While F-2 nonimmigrants are subject to monitoring in SEVIS, as an alien deriving his or her status from that of the F-1 nonimmigrant, they are not required to pay a separate SEVIS fee.

J-1 nonimmigrants, as defined in section 101(a)(15)(J) of the Act, are foreign nationals who have been selected by an exchange visitor program sponsor designated by the United States DOS to participate in an exchange visitor program in the United States. The J-1 classification includes nonimmigrants participating in programs in which they will receive graduate medical education or training. Generally, J-1 nonimmigrants are required to pay a SEVIS fee, and are subject to monitoring in SEVIS. A J-2 nonimmigra nt is a foreign national who is the spouse or qualifying child of a J-1 exchange visitor. While J-2 nonimmigrants are subject to monitoring in SEVIS, as an alien deriving his or her status from that of the J-1 nonimmigrant, they are not required to pay a separate SEVIS fee.

M-1 nonimmigrants, as defined in section 101(a)(15)(M) of the Act, are foreign nationals pursuing a full course of study at a DHS-approved vocational or other recognized nonacademic institution (other than in language training programs) in the United States. The term “school” also encompasses those institutions attended by M-1 students for the purposes of this rule. Generally, M-1 nonimmigrants are subject to the SEVIS fee and monitoring in SEVIS. An M-2 nonimmigrant is a foreign national who is the spouse or qualifying child of an M-1 student. While M-2 nonimmigrants are subject to monitoring in SEVIS, as an alien deriving his or her status from that of the M-1 nonimmigrant, they are not required to pay a separate SEVIS fee.

On November 2, 2002, Congress passed the Border Commuter Student Act of 2002, Public Law 107-274, 116 Stat. 1923 (2002), which created the F-3 and M-3 nonimmigrant classifications for certain aliens who are citizens of Canada or Mexico and who continue to reside in their home country while commuting to the United States to attend an approved school. Such border commuter students are not subject to the existing requirement for F-1 and M-1 students to be pursuing a full course of study. Instead, these border commuter students are specifically permitted to engage in either full-time or part-time studies. DHS adopted regulations relating to border commuter students, 67 FR 54941 (August 27, 2002) (codified at 8 CFR 214.2(f)(18) and (m)(19)), and will be amending those regulations in the future to conform to the new legislation. In this rule, DHS notes that F-3 and M-3 students will be subject to the same rules as F-1 and M-1 students regarding the collection of the fee.

Response to Public Comments on the Proposed Rule

DHS initially proposed a rule implementing section 641(e) of IIRIRA, requiring fee collection related to SEVIS on December 21, 1999, at 64 FR 71323, and received 4,617 comments in response to this proposed rule. On October 26, 2003, DHS published a second proposed rule in the Federal Register at 68 FR 61148. The October 26, 2003, proposed rule addressed the 4,617 comments, as well as setting forth a new proposal for collection of the SEVIS fee. Comments to the second proposed rule were due to DHS on or before December 26, 2003. DHS received 239 comments regarding the collection of the required fee, as set forth in the second proposed rule. The following paragraphs will address each substantive issue raised in comments received in response to the October 2003 proposed rule. However, this discuss ion will not describe in detail all the provisions outlined in either of the prior proposed rules. Rather, it will address only those provisions relevant to the October 2003 comments. Commenters frequently addressed identical issues in their comments and, as a result, the number of comments received exceeds the number of issues discussed.

In general, commenters acknowledged the Congressional mandate that DHS collect this fee and stated that this 2003 proposed rule was a significant improvement over the 1999 proposed rule. A significant number of commenters stated that they were generally pleased with SEVIS and DHS efforts to reach out to the schools and exchange visitor program sponsors. However, most of these commenters further stated that they believed the imposition of the fee would adversely impact participation by foreign students and e xchange visitors. The commenters discussed the fee amount, the collection and remittance process, exemptions and reductions to the fee, the frequency of the fee, the applicability of the fee, and the propriety of the fee.

I. Fee Amount

The October 2003 proposed rule set the fee amount at $100, with the exception of specific J-1 exchange visitor programs. Although several commenters stated that the $100 fee was not overly burdensome, the majority of commenters stated that the fee was excessive and should be set at $54, based upon the fee study conducted in September 2002 by an independent contractor for DHS. Some commenters expressed concern regarding the use of the SEVIS fee to pay for SEVIS-related enforcement and compliance costs. Addit ionally, some commenters expressed concern that excessive fee receipts would become a money-generating tool for DHS, subsidizing other, unrelated programs.

DHS reviewed and considered all comments on the fee amount, but has made the decision not to change the amount of the $100 proposed fee. Comments in response to the 1999 rule raised concerns about the proposed $95 fee, which had been determined by a fee study done in conjunction with the 1999 rule making. An independent fee study, carried out in September 2002, was done to respond to those commenter concerns, and to reassess the amount of the fee, based on changes in the SEVIS project funding since the publ ication of the 1999 proposed rule. An independent consulting firm was hired to conduct an objective fee review and ensure that applicable Federal law and fee guidance were followed. The fee review included the recovery of historical costs and costs over the FY 2003/2004 time period, as well as the appropriated monies received. The fee review also included costs for increased staffing and training for DHS personnel involved in the SEVP at DHS headquarters, district offices, service centers, and regional offi ces, as well as training for DOS personnel. The fee study determined that the fee should be set at $54.

DHS arrived at the final rule fee amount of $100 by taking the fee recommended in the independent study ($54) and adding estimated compliance and enforcement costs, which the fee study did not include. DHS has determined that this fee should offset the resources necessary to ensure compliance with regulations, since compliance and maintenance of system integrity are an integral part of SEVP. Indeed, Congress, in placing SEVIS within ICE, specifically directed that the information collected in the program be used for enforcement purposes; thus, the use of the SEVIS fee for enforcement purposes is consistent with the HSA. See HSA 442(a)(4). This application of user fees as a funding source for compliance activities is also consistent with the introduction of user fees in the early 1980s. A Federal agency is authorized to recoup the “full cost” of providing special benefits, including the costs of enforcement, collection, research, as well as establishment of standards and regulations, when calculating its fees. DHS currently recoups some of the costs of detecting and deterring fraud and protecting the integrity of benefits and documents through its immigration benefit application fees.

One important program benefit to be funded by the $100 fee is the establishment of localized personnel, or SEVIS Liaison Officers. These SEVIS Liaison Officers will be a local resource for schools and students, providing timely and accurate information or assistance in meeting the requirements of the program. SEVIS Liaison Officers may visit schools, interview school officials, review records, compare system information to school information, and assist schools with SEVP issues. They will also coordinate wi th local school representatives and assist with local training program development and implementation. Finally, SEVIS Liaison Officers will be available to assist immigration and other law enforcement officials who may have a need for information derived from SEVIS.

As previously noted, consistent with the HSA mandate to utilize the information collected in SEVIS for enforcement purposes, also included in the fee calculation are funds that will be used to offset the total cost of SEVP enforcement. A portion of the fee will be used to fund new positions and to support officers in existing positions who are performing SEVIS enforcement, as well as to pay for any training, equipment, technical systems, or other items necessary to enhance their ability to enforce SEVIS. Th e ICE officers supported by the SEVIS fee will conduct investigations to ensure compliance with student and exchange visitor regulations. These officers are essential to ensuring data integrity in SEVIS. In addition, these officers will work in conjunction with SEVIS Liaison Officers on school reviews and re-certifications. As noted in the 2003 proposed rule, while the fee will fund only a portion of the ICE officer positions needed to ensure SEVP integrity, DHS intends to staff all of the ICE officers nece ssary to ensure the success of compliance efforts.

This rule sets the fee at the maximum amount initially authorized by IIRIRA ($100) for all F, M, and J nonimmigrants, with the exception of exchange visitors admitted as au pairs, camp counselors, or participants in summer work/travel programs who will be subject to a fee of $35, and those exempt from the fee altogether. IIRIRA also provides that the Secretary of Homeland Security may, on a periodic basis, revise the amount of the fee imposed and collected to take into account changes in the cost of carryin g out the SEVP. Pursuant to the Chief Financial Officers Act of 1990, DHS will review this fee amount at least every 2 years. Upon review, if DHS finds that the fee is either too high or too low, the fee amount may be adjusted. Adjustments will be made subject to the Federal rulemaking process.

Fee reviews to determine the appropriate amount of the fee and any adjustments required typically look at historical costs as well as anticipated costs based upon programmatic changes. Since DHS is establishing a dedicated sub-account for SEVIS fees within the Immigration Examination Fee Account, any excess revenue will accrue until the next scheduled fee review and will then be factored into the establishment of the new fee. As required by section 641 of IIRIRA, DHS will not use the proceeds from SEVIS fee s except for SEVIS-related purposes, and will not generate revenue for other programs from this source. DHS notes that several commenters suggested that future fee studies be conducted by independent contractors and DHS acknowledges the value of this suggestion. However, DHS will not specifically comment in this rule on how future fee studies will be conducted.

Several commenters objected to both the concept of a fee and the fee amount proposed. Some commenters stated that the imposition of a fee would deter participation and adversely affect the position of the United States in the international student/exchange visitor market, and that the regulations authorizing collection of such a fee will interfere with important cultural exchanges. DHS acknowledges these concerns; however, Congress has mandated that DHS set the SEVIS fee at an amount sufficient to cover the costs associated with the SEVP, including recouping the historical costs of program implementation, and ongoing costs of program maintenance. Thus, DHS is required to impose a fee on the nonimmigrants for whom the system was developed and maintained. DHS set the fee amount based upon program costs and is statutorily prohibited from lowering the fee to an amount that does not fund the program in order to address these concerns.

Some commenters expressed concern that imposition of a SEVIS fee might lead to fraudulent use of visitor visa classifications to attend non-SEVIS-certified schools (particularly short-term English language programs). However, DHS cannot fail to implement the statutorily mandated fee because of potential fraud. Rather, DHS enforcement officers will continue to work to ensure that all nonimmigrant entries and stays in the United States are legal and based upon appropriate visa classifications.

II. The Fee Collection and Remittance Process

The 1999 proposed rule required that educational institutions and exchange visitor program sponsors collect the fee, based upon then existing law, and mandated that the fee be collected prior to visa issuance. Congress subsequently amended the law to permit DHS to collect the fee directly from the F-1, F-3, J-1, M-1, or M-3 nonimmigrants. Based upon these amendments to the law, the October 2003 proposed rule provided for fee collection by DHS and required that proof of payment be presented during the visa a pplication process or prior to submitting a change of status request.

A number of the comments DHS received focused on the DHS fee collection process. The majority of commenters suggested that DOS collect the fee at the time of the visa interview, similar to the payment methodology used for collecting visa fees. Many commenters felt that without this change, nonimmigrants would experience difficulties and delays with payment methods that required use of the Internet, use of credit cards, use of checks drawn on U.S. banks and payable in U.S. dollars, and/or use of foreign mail delivery systems which may not be timely or reliable. A few commenters proposed the collection of the fee at the ports-of-entry when students and exchange visitors entered the United States, as an alternative payment method.

DHS has considered the concerns raised by the commenters and will continue to work on alternate fee payment methodologies. DHS will not be able to establish a workable arrangement for fee collection by DOS prior to the effective date of this rule. However, a pilot DOS fee collection methodology is being developed at this time. Additionally, DHS is unable to implement fee collection at ports-of-entry due to the statutory mandate that the SEVIS fee be paid prior to visa issuance. Aliens who are exempt from th e F, M, or J visa requirement, as described in section 212(d)(4) of the Act (e.g., Canadians), will be required to pay the fee and have the fee processed prior to applying for admission at a U.S. port-of-entry. Ports-of-entry will not be equipped to collect fees or provide mechanisms for nonimmigrants to submit fee payments. Also, consistent with the requirements of section 641 of IIRIRA, nonimmigrants who are already located in the United States will be required to pay the fee prior to being approved for a change of classification to an F or M student or J exchange visitor, unless specifically exempt by DHS due to extenuating circumstances as determined by SEVP.