81 FR 64088 - Schedule of Fees for Consular Services, Department of State and Overseas Embassies and Consulates-Passport Services Fee Changes

DEPARTMENT OF STATE

Federal Register Volume 81, Issue 181 (September 19, 2016)

Page Range		64088-64092
FR Document		2016-22215
The Department of State proposes an adjustment to the Schedule of Fees for Consular Services of the Department of State's Bureau of Consular Affairs (``Schedule of Fees'' or ``Schedule'') for the execution fee for passport books and cards. The Department is adjusting this fee in light of the findings of the most recent annual update to the Cost of Service Model to better align the fees for consular services with the costs of providing those services.
Federal Register, Volume 81 Issue 181 (Monday, September 19, 2016)
[Federal Register Volume 81, Number 181 (Monday, September 19, 2016)]
[Proposed Rules]
[Pages 64088-64092]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2016-22215]


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DEPARTMENT OF STATE

22 CFR Part 22

[Public Notice: 9520]
RIN 1400-AD81


Schedule of Fees for Consular Services, Department of State and 
Overseas Embassies and Consulates--Passport Services Fee Changes

AGENCY: Department of State.

ACTION: Proposed rule.

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SUMMARY: The Department of State proposes an adjustment to the Schedule 
of Fees for Consular Services of the Department of State's Bureau of 
Consular Affairs (``Schedule of Fees'' or ``Schedule'') for the 
execution fee for passport books and cards. The Department is adjusting 
this fee in light of the findings of the most recent annual update to 
the Cost of Service Model to better align the fees for consular 
services with the costs of providing those services.

DATES: The Department of State will accept comments on this proposed 
rule until November 18, 2016.

ADDRESSES: Interested parties may submit comments to the Department by 
any of the following methods:
     Visit the Regulations.gov Web site at: http://www.regulations.gov and search for the Regulatory Information Number 
(RIN) 1400-AD81 or docket number DOS-2016-0029.
     Mail paper document: U.S. Department of State, Office of 
the Comptroller, Bureau of Consular Affairs (CA/C), SA-17, 8th Floor, 
Washington, DC 20522-1707.
     Email: [email protected]. You must include the RIN (1400-
AD81) in the subject line of your message.
     All comments should include the commenter's name, the 
organization the commenter represents, if applicable, and the 
commenter's address. If the Department is unable to read your comment 
for any reason, and cannot contact you for clarification, the 
Department may not be able to consider your comment. After the 
conclusion of the comment period, the Department will publish a Final 
Rule (in which it will address relevant comments) as expeditiously as 
possible.

FOR FURTHER INFORMATION CONTACT: James McDaniel, Management Analyst, 
Office of the Comptroller, Bureau of Consular Affairs, Department of 
State; phone: 202-485-6694, telefax: 202-485-6826; email: 
[email protected].

SUPPLEMENTARY INFORMATION: 

Background

    The proposed rule makes a change to the Schedule of Fees. The 
Department sets and collects its fees based on the concept of full cost 
recovery. The Department completed its most recent review of current 
consular fees and will implement a change to the Schedule of Fees based 
on the costs of services calculated by the Fiscal Year 2014 update to 
the Cost of Service Model.

What is the authority for this action?

    The Department of State derives the general authority to set fees 
based on the cost of the consular services it provides, and to charge 
those fees, from the general user charges statute, 31 U.S.C. 9701. See, 
e.g., 31 U.S.C. 9701(b)(2)(A) (``The head of each agency . . . may 
prescribe regulations establishing the charge for a service or thing of 
value provided by the agency . . . based on . . . the costs to the 
government.''). As implemented through Executive Order 10718 of June 
27, 1957, 22 U.S.C. 4219 further authorizes the Department to establish 
fees to be charged for official services provided by U.S. embassies and 
consulates.
    Several statutes address specific fees relating to passports. For 
instance, 22 U.S.C. 214(a) authorizes the Secretary of State to set the 
passport execution fee by regulation, and to authorize state and local 
government officials and the U.S. Postal Service to collect and retain 
the execution fee for each application for a passport accepted by such 
officials or the U.S. Postal Service.
    Certain people are exempted by law or regulation from paying 
specific fees. They include, for instance, exemptions from the passport 
execution and application fees for officers or employees of the U.S. 
government proceeding abroad in the discharge of official duties and 
exemption from the passport execution fee if those officers or 
employees execute their application before a federal official. See 22 
U.S.C. 214(a); 22 CFR 22.1; 22 CFR 51.52(b).
    The Department last changed fees for passport services in an 
interim final rule

[[Page 64089]]

dated September 8, 2015. See Department of State Schedule of Fees for 
Consular Services, Department of State and Overseas Embassies and 
Consulates, 22 CFR part 22 (80 FR 53704). Those changes to the Schedule 
went into effect September 26, 2015. A final rule regarding those fees 
has not yet been published.

Why is the Department adjusting fees at this time?

    With certain exceptions--such as the reciprocal nonimmigrant visa 
issuance fee--the Department of State generally sets consular fees at 
an amount calculated to achieve recovery of the costs to the U.S. 
government of providing the consular service, in a manner consistent 
with general user charges principles, regardless of the specific 
statutory authority under which the fees are authorized. As set forth 
in OMB Circular A-25, as a general policy, each recipient should pay a 
reasonable user charge for government services, resources, or goods 
from which he or she derives a special benefit, at an amount sufficient 
for the U.S. government to recover the full costs to it of providing 
the service, resource, or good. See OMB Circular No. A-25, sec. 
6(a)(2)(a). The OMB guidance covers all Federal Executive Branch 
activities that convey special benefits to recipients beyond those that 
accrue to the general public. See id., sections 4(a), 6(a)(1).
    The Department reviews consular fees through an annual update to 
its Cost of Service Model to determine the appropriateness of each fee 
in light of OMB guidance. The Department proposes to make the change 
set forth below in the Schedule of Fees accordingly. The Cost of 
Service Model is an activity-based costing model that determines the 
current direct and indirect costs to the U.S. government associated 
with each consular good and service the Department provides. The model 
update identified the direct and indirect cost of the passport 
execution fee, and the update's results formed the basis of the change 
herein proposed to the Schedule.

Activity-Based Costing

    To set fees in accordance with the general user charges principles, 
the Department must determine the true cost of providing consular 
services. Following guidance provided in ``Managerial Cost Accounting 
Concepts and Standards for the Federal Government,'' OMB's Statement #4 
of Federal Accounting Standards (SFFAS #4), available at http://www.fasab.gov/pdffiles/sffas-4.pdf, the Department chose to develop and 
use an activity-based costing (ABC) model to determine the true cost of 
each of its consular services.
    The Government Accountability Office (GAO) defines activity-based 
costing as a ``set of accounting methods used to identify and describe 
costs and required resources for activities within processes.'' Because 
an organization can use the same staff and resources (computer 
equipment, production facilities, etc.) to produce multiple products or 
services, ABC models seek to identify and assign costs to processes and 
activities, and then to individual products and services through the 
identification of key cost drivers referred to as ``resource drivers'' 
and ``activity drivers.'' ABC models also seek to identify the amount 
of time an organization's personnel spend on each service and how much 
overhead cost (rent, utilities, facilities maintenance, etc.) is 
associated with delivering each service. ABC models require financial 
and accounting analysis, and modeling skills combined with a detailed 
understanding of an organization's business processes. ABC models 
require an organization to identify all activities required to produce 
a particular product or service (``activities'') and all resources 
consumed (costs) in the course of producing that product or service. An 
organization also must measure the quantity of resources consumed 
(``resource driver''); and the frequency and intensity of demand placed 
on activities to produce services (``activity driver''). SFFAS 
Statement #4 provides a detailed discussion of the use of cost 
accounting by the U.S. government.

The Department's Cost of Service Model

    The Department conducted periodic Cost of Service Studies using ABC 
methods to determine the costs of its consular services through 2009. 
In 2010, the Department moved to adopt an annually updated Cost of 
Service Model (CoSM) that measures all of its consular operations and 
costs, including all of the activities needed to provide consular 
services, whether fee-based or not. This provides a comprehensive and 
detailed look at all consular services and all services that the 
Department performs for other agencies in connection with its consular 
operations. The CoSM now includes approximately 80 distinct activities, 
and enables the Department to model its consular-related costs with a 
high degree of precision.
    The Department uses three methods outlined in SFFAS Statement #4 
(paragraph 149(2)) to assign resource costs to activities: (a) Direct 
tracing; (b) estimation based on surveys, interviews, or statistical 
sampling; and (c) allocations. The Department uses direct tracing to 
assign the cost of, for example, a physical passport book or the visa 
foil placed in a visa applicant's passport. Assigning costs to 
activities such as adjudicating a passport or visa application requires 
estimation based on surveys, interviews, or statistical sampling to 
determine who performs an activity and how long it takes. Indirect 
costs (overhead) in the CoSM are allocated according to the level of 
effort needed for a particular activity. Where possible, the model uses 
overhead cost pools to assign indirect costs only to related 
activities. For instance, the cost of rent for domestic passport 
agencies is assigned only to passport costs, not to visas or other 
services the Department provides only overseas. The Department 
allocates indirect support costs to each consular service by the 
portion of each cost attributable to consular activities. For example, 
the model allocates a portion of the cost of the Department's Bureau of 
Human Resources to consular services. The total amount of this 
allocation is based on the number of Bureau of Human Resources staff 
members who support Bureau of Consular Affairs personnel. In turn, this 
amount is allocated among the different consular services by the level 
of effort to provide them.
    To assign labor costs, the Department relies on a variety of 
industry-standard estimation methodologies. To document how consular 
staff divide their time overseas, the Department conducts the Consular 
Overseas Data Collection (CODaC) survey of a representative sample of 
posts each year. The Department uses CODaC survey data in conjunction 
with volume data from more than 200 individual consular sections in 
consulates and embassies worldwide, to develop resource drivers to 
assign labor costs to activities. For consular activities that take 
place in the United States, the Department collects volume data from 
periodic workload reports, including Passport Agency Task Reports 
pulled from management databases that include Passport's Management 
Information System. Financial information is gathered from reports by 
the Bureau of Consular Affairs' Office of the Comptroller. The 
Department converts the cost and workload data it collects into 
resource drivers and activity drivers for each resource and activity.
    Because approximately 70 percent of the workforce involved in 
providing consular services are full-time Federal employees, if demand 
for a service falls precipitously, the Department cannot

[[Page 64090]]

shed employees as quickly as the private sector. Likewise, should 
demand rise precipitously, the Department cannot add employees quickly, 
because delivering the majority of consular services requires specially 
trained employees who cannot begin their training until they have 
completed the Federal hiring process and obtained a security clearance. 
Additionally, given government procurement rules and security 
requirements, the Department must commit to many of its facilities and 
infrastructure costs years before a facility becomes available. In 
spite of changes in demand, the Department is obligated to cover these 
costs. Given these and other constraints on altering the Department's 
cost structure in the short term, changes in service volumes can have 
dramatic effects on whether a fee is self-sustaining. Therefore, the 
CoSM includes two years of predictive data and three years of actual 
data. Predictive workloads are based on projections by the Office of 
Visa Services, the Office of Passport Services, and other parts of the 
Bureau of Consular Affairs that are consistent with Department budget 
documents prepared for Congress.
    The costs the Department enters into the CoSM include every line 
item of costs, including items such as physical material for making 
passports and visas, salaries, rent, supplies, and IT hardware and 
software. The Department then determines a resource driver (from, for 
example, the responses to the CODaC survey) for each of these costs, as 
discussed above and enters the resource drivers and assignments into 
the model. The Department then selects an activity driver, such as the 
volume data discussed above, for each activity, in order to assign 
these costs to each service type. This process allows the model to 
calculate a total cost for each of the Schedule of Fees' line items for 
visa services, passport services, and overseas citizens services, and 
services for other government agencies and no-fee services. The model 
then divides this total cost by the total volume of the service or 
product in question in order to determine a final unit cost for the 
service or product. Projected costs for predictive years also are 
included to take account of changes in the size of consular staff, 
workload, and similar factors. The resulting database constitutes the 
CoSM. The Department continues to refine and update the CoSM in order 
to set fees commensurate with the cost of providing consular services. 
Because the CoSM is a complex series of iterative computer processes 
incorporating more than a million calculations, it is not reducible to 
a tangible form such as a document. Inputs are formatted in 
spreadsheets for entry into the ABC software package. The ABC software 
package itself is an industry standard commercial off-the-shelf 
product, SAP Business Objects. The software's output includes 
spreadsheets with raw unit costs, validation reports, and management 
reports.
    A number of fees are set at levels other than cost. These include 
passport fees for minors, which are set below cost as a longstanding 
matter of policy, and the reduced Border Crossing Card Fee for Mexican 
Minors, which is set by law. The true cost of these services must be 
offset by other fees. These offsets are calculated on additional 
spreadsheets outside the model software. Final unit costs incorporate 
these offsets.

Schedule of Fees Updates

    The last broad set of amendments to the Schedule of Fees occurred 
in 2014, though the Department has made some specific amendments to it 
since that time. Some fees, including the Immigrant Visa petition and 
the Immigrant Visa ineligibility waiver (items 31(a) and 35(c) 
respectively), are set by the Department of Homeland Security and were 
most recently updated by that agency on November 23, 2010. The change 
to the current Schedule of Fees is discussed below. The CoSM estimate 
discussed below is based on projected workload for Fiscal Year 2016, 
and the proposed fee has been rounded to make it easier to collect.

Passport Execution Fee

    The Department proposes to increase the execution fee for passport 
books and cards from $25 to $35, excepting those persons who are 
exempted statutorily from paying the passport execution fee. The 
passport execution fee is applicable to all first-time passport 
applicants and certain other applicants who must apply in person, such 
as minors under the age of 16. Applicants apply in-person at post 
offices and other acceptance facilities, such as local clerks of court, 
and at the Department's passport offices. The passport execution fee 
includes the costs associated with accepting passport applications and 
fees in-person, including salaries, benefits, and an allocated portion 
of overhead including, but not limited to, rent, utilities, supplies, 
and equipment. The Department's CoSM showed that these costs were more 
than $33. The U.S. Postal Service--the acceptance agent for the 
majority of passport applications--regularly conducts a similar study 
and found that these costs were more than $34. See 22 U.S.C. 214(a); 22 
CFR 51.51(b).
    The $10 increase in the passport execution fee will result in a $10 
increase to the cost to first-time passport applicants and certain 
applicants who must appear at post offices and other acceptance 
facilities such as local clerks of court. Individuals who apply for a 
passport renewal by mail will not see a fee increase.

Regulatory Findings

Administrative Procedure Act
    The Department is publishing this rule as a proposed rule, with a 
60-day provision for public comments.
Regulatory Flexibility Act
    The Department reviewed this proposed rule and, by approving it, 
certifies that it will not have a significant economic impact on a 
substantial number of small entities as defined in 5 U.S.C. 601(6).
Unfunded Mandates Act of 1995
    This proposed rule will not result in the expenditure by state, 
local, and tribal governments, in the aggregate, or by the private 
sector, of $100 million or more in any year, and it will not 
significantly or uniquely affect small governments. Therefore, no 
actions were deemed necessary under the provisions of the Unfunded 
Mandates Reform Act of 1995, 2 U.S.C. 1501-1504.
Small Business Regulatory Enforcement Fairness Act of 1996
    This proposed rule is a major rule as defined by 5 U.S.C. 804(2).
Executive Order 12866
    The Department has reviewed this proposed rule to ensure its 
consistency with the regulatory philosophy and principles set forth in 
the Executive Orders. OMB determined that this rule is significant 
under Executive Order 12866, and the Department confirmed that it is 
economically significant as defined by the Executive Order.
    This proposed rule is necessary in light of the Department of 
State's CoSM finding that the cost of executing first-time passports is 
higher than the current fee. The Department is setting the fees in 
accordance with 31 U.S.C. 9701 and other applicable authority, as 
described in more detail above. See, e.g., 31 U.S.C. 9701(b)(2)(A) 
(``The head of each agency . . . may prescribe regulations establishing 
the charge for a service or thing of value provided by the agency . . . 
based on . . . the costs to the Government.''). This regulation 
generally sets the fee for passport

[[Page 64091]]

executions at the amount required to recover the costs associated with 
providing this service.
    Details of the proposed fee change are as follows:

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                             Estimated
                                                                                                                           annual number     Estimated
                        Item No.                           Proposed fee     Current fee    Change in fee    Percentage          of           change in
                                                                                                             increase      applications     annual fees
                                                                                                                                \1\        collected \1\
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                         SCHEDULE OF FEES FOR CONSULAR SERVICES
--------------------------------------------------------------------------------------------------------------------------------------------------------
 
                                                                      * * * * * * *
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                            PASSPORT AND CITIZENSHIP SERVICES
--------------------------------------------------------------------------------------------------------------------------------------------------------
1. Passport Book or Card Execution: Required for first-              $35             $25             $10             40%      11,763,831    $117,638,310
 time applicants and others who must apply in person....
                                                         -----------------------------------------------------------------------------------------------
    Total...............................................  ..............  ..............  ..............  ..............  ..............    $117,638,310
 
                                                                      * * * * * * *
--------------------------------------------------------------------------------------------------------------------------------------------------------
\1\ Based on projected FY 2016 workload.

    The Department of State does not anticipate that demand for 
passport services affected by this proposed rule will change 
significantly because of these fee changes, and welcomes public comment 
on that expectation.
    The Department does not believe that passport application fees are 
a significant determining factor when U.S. citizens decide to travel 
internationally. The price of a passport book or card remains minor in 
comparison with other costs associated with foreign travel, given that 
taxes and surcharges alone on an international airfare can easily 
surpass $100. As a result, the Department does not believe passport 
demand will be significantly affected by increases of the size 
proposed.
Executive Orders 12372 and 13132
    This regulation will not have substantial direct effects on the 
states, on the relationship between the national government and the 
states, or on the distribution of power and responsibilities among the 
various levels of government. Therefore, in accordance with section 6 
of Executive Order 13132, it is determined that this rule does not have 
sufficient federalism implications to require consultations or warrant 
the preparation of a federalism summary impact statement. The 
regulations implementing Executive Order 12372 regarding 
intergovernmental consultation on federal programs and activities do 
not apply to this regulation.
Executive Order 13175
    The Department determined that this proposed rulemaking will not 
have tribal implications, will not impose substantial direct compliance 
costs on Indian tribal governments, and will not preempt tribal law. 
Accordingly, the requirements of Executive Order 13175 do not apply to 
this rulemaking.
Paperwork Reduction Act
    This information collection contained in this proposed rule is 
pursuant to the Paperwork Reduction Act, 44 U.S.C. Chapter 35. 
Information Collection 1405-0004, form DS-11 is related to this 
proposed rule. The Notice of Proposed Rulemaking proposes an increase 
in the passport execution fee, from $25 to $35, based on the result of 
the Department CoSM, which found that the government's cost of 
executing a first-time passport is higher than the fee that the 
Department was charging an individual applicant. The CoSM is an 
activity-based costing model that determines the current direct and 
indirect costs to the U.S. government associated with each consular 
good and service the Department provides.
    This information collection was renewed on August 30, 2016, with an 
expiration date of August 31, 2019. This notice request comments as it 
pertains to the proposed fee increase from $25 to $35.
(1) Title of Information Collection: Application for a U.S. Passport.
(2) OMB Control Number: 1405-0004.
(3) Type of Request: Revision of a Currently Approved Collection.
(4) Form Number: DS-11.
(5) Respondents: Individuals or Households.
(6) Estimated Number of Respondents: 11,763,831.
(7) Estimated Number of Responses: 11,763,831.
(8) Average Time per Response: 85 Minutes.
(9) Total Estimated Burden Time: 16,665,427 hours.
(10) Frequency: On occasion.
(11) Obligation to Respond: Required to Obtain a Benefit.
(12) Submit comments to OMB by the following methods:
Office of Management and Budget (OMB):
     Direct comments to the Department of State Desk Officer in 
the Office of Information and Regulatory Affairs at the Office of 
Management and Budget (OMB). You may submit comments by the following 
methods:
     Email: [email protected]. You must include the 
DS form number, information collection title, and the OMB control 
number in the subject line of your message.
    Fax: 202-395-5806. Attention: Desk Officer for Department of State.
Abstract of Proposed Collection
    The DS-11 solicits data necessary for Passport Services to issue a 
U.S. passport (book and/or card format) pursuant to authorities granted 
to the Secretary of State by 22 U.S.C. 211a et seq. and Executive Order 
(E.O.) 11295 (August 5, 1966) for the issuance of passports to U.S. 
nationals.
    The issuance of U.S. passports requires the determination of 
identity, nationality, and entitlement with reference to the provisions 
of Title III of the Immigration and Nationality Act (INA) (8 U.S.C. 
1401-1504), the 14th Amendment to the Constitution of the United 
States, other applicable treaties and laws, and implementing 
regulations at 22 CFR parts 50 and 51. The specific regulations 
pertaining to the Application for a U.S. passport are at 22 CFR 51.20 
through 51.28.

[[Page 64092]]

Methodology
    The information collected on the DS-11 is used to facilitate the 
issuance of passports to U.S. citizens and nationals. The primary 
purpose of soliciting the information is to establish citizenship, 
identity, and entitlement to the issuance of the U.S. passport or 
related service, and to properly administer and enforce the laws 
pertaining to the issuance thereof.
    Passport Services collects information from U.S. citizens and non-
citizen nationals when they complete and submit the Application for a 
U.S. passport. Passport applicants can either download the DS-11 from 
the Internet or obtain one from an Acceptance Facility/Passport Agency. 
The form must be completed and executed at an acceptance facility or 
passport agency, and submitted with evidence of citizenship and 
identity.

List of Subjects in 22 CFR Part 22

    Consular services, Fees, Passports.

    Accordingly, for the reasons stated in the preamble, 22 CFR part 22 
is proposed to be amended as follows:

PART 22--SCHEDULE OF FEES FOR CONSULAR SERVICES--DEPARTMENT OF 
STATE AND FOREIGN SERVICE

0
1. The authority citation for part 22 is revised to read as follows:

    Authority:  8 U.S.C. 1101 note, 1153 note, 1183a note, 1351, 
1351 note, 1714, 1714 note; 10 U.S.C. 2602(c); 11 U.S.C. 1157 note; 
22 U.S.C. 214, 214 note, 1475e, 2504(a), 2651a, 4201, 4206, 4215, 
4219, 6551; 31 U.S.C. 9701; Exec. Order 10,718, 22 FR 4632 (1957); 
Exec. Order 11,295, 31 FR 10603 (1966).

0
2. Revise item 1 in the table ``Schedule of Fees for Consular 
Services'' in Sec.  22.1 to read as follows:


Sec.  22.1  Schedule of fees.

* * * * *

                 Schedule of Fees for Consular Services
------------------------------------------------------------------------
                        Item No.                               Fee
------------------------------------------------------------------------
                    Passport and Citizenship Services
------------------------------------------------------------------------
    1. Passport Book or Card Execution: Required for                $35
     first-time applicants and others who must apply in
     person (Applicants applying for both the book and
     card simultaneously on the same application pay
     only one execution fee.)..........................
 
                              * * * * * * *
------------------------------------------------------------------------


    Dated: July 31, 2016.
Patrick F. Kennedy,
Under Secretary for Management.
[FR Doc. 2016-22215 Filed 9-16-16; 8:45 am]
 BILLING CODE 4710-13-P
Federal Register / Vol. 81, No. 181 / Monday, September 19, 2016 / Proposed Rules 64089

dated September 8, 2015. See based costing (ABC) model to determine estimation based on surveys, interviews,
Department of State Schedule of Fees the true cost of each of its consular or statistical sampling; and (c)
for Consular Services, Department of services. allocations. The Department uses direct
State and Overseas Embassies and The Government Accountability tracing to assign the cost of, for
Consulates, 22 CFR part 22 (80 FR Office (GAO) defines activity-based example, a physical passport book or
53704). Those changes to the Schedule costing as a ‘‘set of accounting methods the visa foil placed in a visa applicant’s
went into effect September 26, 2015. A used to identify and describe costs and passport. Assigning costs to activities
final rule regarding those fees has not required resources for activities within such as adjudicating a passport or visa
yet been published. processes.’’ Because an organization can application requires estimation based on
use the same staff and resources surveys, interviews, or statistical
Why is the Department adjusting fees at (computer equipment, production sampling to determine who performs an
this time? facilities, etc.) to produce multiple activity and how long it takes. Indirect
With certain exceptions—such as the products or services, ABC models seek costs (overhead) in the CoSM are
reciprocal nonimmigrant visa issuance to identify and assign costs to processes allocated according to the level of effort
fee—the Department of State generally and activities, and then to individual needed for a particular activity. Where
sets consular fees at an amount products and services through the possible, the model uses overhead cost
calculated to achieve recovery of the identification of key cost drivers pools to assign indirect costs only to
costs to the U.S. government of referred to as ‘‘resource drivers’’ and related activities. For instance, the cost
providing the consular service, in a ‘‘activity drivers.’’ ABC models also of rent for domestic passport agencies is
manner consistent with general user seek to identify the amount of time an assigned only to passport costs, not to
charges principles, regardless of the organization’s personnel spend on each visas or other services the Department
specific statutory authority under which service and how much overhead cost provides only overseas. The Department
the fees are authorized. As set forth in (rent, utilities, facilities maintenance, allocates indirect support costs to each
OMB Circular A–25, as a general policy, etc.) is associated with delivering each consular service by the portion of each
each recipient should pay a reasonable service. ABC models require financial cost attributable to consular activities.
user charge for government services, and accounting analysis, and modeling For example, the model allocates a
resources, or goods from which he or skills combined with a detailed portion of the cost of the Department’s
she derives a special benefit, at an understanding of an organization’s Bureau of Human Resources to consular
amount sufficient for the U.S. business processes. ABC models require services. The total amount of this
government to recover the full costs to an organization to identify all activities allocation is based on the number of
it of providing the service, resource, or required to produce a particular product Bureau of Human Resources staff
good. See OMB Circular No. A–25, sec. or service (‘‘activities’’) and all members who support Bureau of
6(a)(2)(a). The OMB guidance covers all resources consumed (costs) in the Consular Affairs personnel. In turn, this
Federal Executive Branch activities that course of producing that product or amount is allocated among the different
convey special benefits to recipients service. An organization also must consular services by the level of effort
beyond those that accrue to the general measure the quantity of resources to provide them.
public. See id., sections 4(a), 6(a)(1). consumed (‘‘resource driver’’); and the To assign labor costs, the Department
The Department reviews consular fees frequency and intensity of demand relies on a variety of industry-standard
through an annual update to its Cost of placed on activities to produce services estimation methodologies. To document
Service Model to determine the (‘‘activity driver’’). SFFAS Statement #4 how consular staff divide their time
appropriateness of each fee in light of provides a detailed discussion of the use overseas, the Department conducts the
OMB guidance. The Department of cost accounting by the U.S. Consular Overseas Data Collection
proposes to make the change set forth government. (CODaC) survey of a representative
below in the Schedule of Fees sample of posts each year. The
accordingly. The Cost of Service Model The Department’s Cost of Service Model
Department uses CODaC survey data in
is an activity-based costing model that The Department conducted periodic conjunction with volume data from
determines the current direct and Cost of Service Studies using ABC more than 200 individual consular
indirect costs to the U.S. government methods to determine the costs of its sections in consulates and embassies
associated with each consular good and consular services through 2009. In 2010, worldwide, to develop resource drivers
service the Department provides. The the Department moved to adopt an to assign labor costs to activities. For
model update identified the direct and annually updated Cost of Service Model consular activities that take place in the
indirect cost of the passport execution (CoSM) that measures all of its consular United States, the Department collects
fee, and the update’s results formed the operations and costs, including all of volume data from periodic workload
basis of the change herein proposed to the activities needed to provide reports, including Passport Agency Task
the Schedule. consular services, whether fee-based or Reports pulled from management
not. This provides a comprehensive and databases that include Passport’s
Activity-Based Costing detailed look at all consular services Management Information System.
To set fees in accordance with the and all services that the Department Financial information is gathered from
general user charges principles, the performs for other agencies in reports by the Bureau of Consular
Department must determine the true connection with its consular operations. Affairs’ Office of the Comptroller. The
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cost of providing consular services. The CoSM now includes approximately Department converts the cost and
Following guidance provided in 80 distinct activities, and enables the workload data it collects into resource
‘‘Managerial Cost Accounting Concepts Department to model its consular- drivers and activity drivers for each
and Standards for the Federal related costs with a high degree of resource and activity.
Government,’’ OMB’s Statement #4 of precision. Because approximately 70 percent of
Federal Accounting Standards (SFFAS The Department uses three methods the workforce involved in providing
#4), available at http://www.fasab.gov/ outlined in SFFAS Statement #4 consular services are full-time Federal
pdffiles/sffas-4.pdf, the Department (paragraph 149(2)) to assign resource employees, if demand for a service falls
chose to develop and use an activity- costs to activities: (a) Direct tracing; (b) precipitously, the Department cannot

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64090 Federal Register / Vol. 81, No. 181 / Monday, September 19, 2016 / Proposed Rules

shed employees as quickly as the million calculations, it is not reducible found that these costs were more than
private sector. Likewise, should demand to a tangible form such as a document. $34. See 22 U.S.C. 214(a); 22 CFR
rise precipitously, the Department Inputs are formatted in spreadsheets for 51.51(b).
cannot add employees quickly, because entry into the ABC software package. The $10 increase in the passport
delivering the majority of consular The ABC software package itself is an execution fee will result in a $10
services requires specially trained industry standard commercial off-the- increase to the cost to first-time passport
employees who cannot begin their shelf product, SAP Business Objects. applicants and certain applicants who
training until they have completed the The software’s output includes must appear at post offices and other
Federal hiring process and obtained a spreadsheets with raw unit costs, acceptance facilities such as local clerks
security clearance. Additionally, given validation reports, and management of court. Individuals who apply for a
government procurement rules and reports. passport renewal by mail will not see a
security requirements, the Department A number of fees are set at levels fee increase.
must commit to many of its facilities other than cost. These include passport
Regulatory Findings
and infrastructure costs years before a fees for minors, which are set below cost
facility becomes available. In spite of as a longstanding matter of policy, and Administrative Procedure Act
changes in demand, the Department is the reduced Border Crossing Card Fee The Department is publishing this
obligated to cover these costs. Given for Mexican Minors, which is set by rule as a proposed rule, with a 60-day
these and other constraints on altering law. The true cost of these services must provision for public comments.
the Department’s cost structure in the be offset by other fees. These offsets are
calculated on additional spreadsheets Regulatory Flexibility Act
short term, changes in service volumes
can have dramatic effects on whether a outside the model software. Final unit The Department reviewed this
fee is self-sustaining. Therefore, the costs incorporate these offsets. proposed rule and, by approving it,
CoSM includes two years of predictive Schedule of Fees Updates certifies that it will not have a
data and three years of actual data. significant economic impact on a
The last broad set of amendments to substantial number of small entities as
Predictive workloads are based on
the Schedule of Fees occurred in 2014, defined in 5 U.S.C. 601(6).
projections by the Office of Visa
though the Department has made some
Services, the Office of Passport Services, Unfunded Mandates Act of 1995
specific amendments to it since that
and other parts of the Bureau of
time. Some fees, including the This proposed rule will not result in
Consular Affairs that are consistent with
Immigrant Visa petition and the the expenditure by state, local, and
Department budget documents prepared
Immigrant Visa ineligibility waiver tribal governments, in the aggregate, or
for Congress. (items 31(a) and 35(c) respectively), are by the private sector, of $100 million or
The costs the Department enters into set by the Department of Homeland more in any year, and it will not
the CoSM include every line item of Security and were most recently significantly or uniquely affect small
costs, including items such as physical updated by that agency on November governments. Therefore, no actions were
material for making passports and visas, 23, 2010. The change to the current deemed necessary under the provisions
salaries, rent, supplies, and IT hardware Schedule of Fees is discussed below. of the Unfunded Mandates Reform Act
and software. The Department then The CoSM estimate discussed below is of 1995, 2 U.S.C. 1501–1504.
determines a resource driver (from, for based on projected workload for Fiscal
example, the responses to the CODaC Year 2016, and the proposed fee has Small Business Regulatory Enforcement
survey) for each of these costs, as been rounded to make it easier to Fairness Act of 1996
discussed above and enters the resource collect. This proposed rule is a major rule as
drivers and assignments into the model. defined by 5 U.S.C. 804(2).
The Department then selects an activity Passport Execution Fee
driver, such as the volume data The Department proposes to increase Executive Order 12866
discussed above, for each activity, in the execution fee for passport books and The Department has reviewed this
order to assign these costs to each cards from $25 to $35, excepting those proposed rule to ensure its consistency
service type. This process allows the persons who are exempted statutorily with the regulatory philosophy and
model to calculate a total cost for each from paying the passport execution fee. principles set forth in the Executive
of the Schedule of Fees’ line items for The passport execution fee is applicable Orders. OMB determined that this rule
visa services, passport services, and to all first-time passport applicants and is significant under Executive Order
overseas citizens services, and services certain other applicants who must apply 12866, and the Department confirmed
for other government agencies and no- in person, such as minors under the age that it is economically significant as
fee services. The model then divides of 16. Applicants apply in-person at defined by the Executive Order.
this total cost by the total volume of the post offices and other acceptance This proposed rule is necessary in
service or product in question in order facilities, such as local clerks of court, light of the Department of State’s CoSM
to determine a final unit cost for the and at the Department’s passport offices. finding that the cost of executing first-
service or product. Projected costs for The passport execution fee includes the time passports is higher than the current
predictive years also are included to costs associated with accepting passport fee. The Department is setting the fees
take account of changes in the size of applications and fees in-person, in accordance with 31 U.S.C. 9701 and
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consular staff, workload, and similar including salaries, benefits, and an other applicable authority, as described
factors. The resulting database allocated portion of overhead including, in more detail above. See, e.g., 31 U.S.C.
constitutes the CoSM. The Department but not limited to, rent, utilities, 9701(b)(2)(A) (‘‘The head of each agency
continues to refine and update the supplies, and equipment. The . . . may prescribe regulations
CoSM in order to set fees commensurate Department’s CoSM showed that these establishing the charge for a service or
with the cost of providing consular costs were more than $33. The U.S. thing of value provided by the agency
services. Because the CoSM is a Postal Service—the acceptance agent for . . . based on . . . the costs to the
complex series of iterative computer the majority of passport applications— Government.’’). This regulation
processes incorporating more than a regularly conducts a similar study and generally sets the fee for passport

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Federal Register / Vol. 81, No. 181 / Monday, September 19, 2016 / Proposed Rules 64091

executions at the amount required to Details of the proposed fee change are
recover the costs associated with as follows:
providing this service.

Estimated Estimated
Percentage annual change in
Item No. Proposed fee Current fee Change in fee increase number of annual fees
applications 1 collected 1

SCHEDULE OF FEES FOR CONSULAR SERVICES

* * * * * * *

PASSPORT AND CITIZENSHIP SERVICES

1. Passport Book or Card Execution: Re-
quired for first-time applicants and oth-
ers who must apply in person ............... $35 $25 $10 40% 11,763,831 $117,638,310

Total ................................................... ........................ ........................ ........................ ........................ ........................ $117,638,310

* * * * * * *
1 Based on projected FY 2016 workload.

The Department of State does not Indian tribal governments, and will not (9) Total Estimated Burden Time:
anticipate that demand for passport preempt tribal law. Accordingly, the 16,665,427 hours.
services affected by this proposed rule requirements of Executive Order 13175 (10) Frequency: On occasion.
will change significantly because of do not apply to this rulemaking. (11) Obligation to Respond: Required to
these fee changes, and welcomes public Obtain a Benefit.
Paperwork Reduction Act (12) Submit comments to OMB by the
comment on that expectation.
The Department does not believe that This information collection contained following methods:
passport application fees are a in this proposed rule is pursuant to the Office of Management and Budget
significant determining factor when U.S. Paperwork Reduction Act, 44 U.S.C. (OMB):
citizens decide to travel internationally. Chapter 35. Information Collection • Direct comments to the Department
The price of a passport book or card 1405–0004, form DS–11 is related to this of State Desk Officer in the Office of
remains minor in comparison with other proposed rule. The Notice of Proposed Information and Regulatory Affairs at
costs associated with foreign travel, Rulemaking proposes an increase in the the Office of Management and Budget
given that taxes and surcharges alone on passport execution fee, from $25 to $35, (OMB). You may submit comments by
an international airfare can easily based on the result of the Department the following methods:
surpass $100. As a result, the CoSM, which found that the • Email: oira_submission@
Department does not believe passport government’s cost of executing a first- omb.eop.gov. You must include the DS
demand will be significantly affected by time passport is higher than the fee that form number, information collection
increases of the size proposed. the Department was charging an title, and the OMB control number in
individual applicant. The CoSM is an the subject line of your message.
Executive Orders 12372 and 13132 Fax: 202–395–5806. Attention: Desk
activity-based costing model that
This regulation will not have determines the current direct and Officer for Department of State.
substantial direct effects on the states, indirect costs to the U.S. government Abstract of Proposed Collection
on the relationship between the national associated with each consular good and
government and the states, or on the service the Department provides. The DS–11 solicits data necessary for
distribution of power and This information collection was Passport Services to issue a U.S.
responsibilities among the various renewed on August 30, 2016, with an passport (book and/or card format)
levels of government. Therefore, in expiration date of August 31, 2019. This pursuant to authorities granted to the
accordance with section 6 of Executive notice request comments as it pertains Secretary of State by 22 U.S.C. 211a et
Order 13132, it is determined that this to the proposed fee increase from $25 to seq. and Executive Order (E.O.) 11295
rule does not have sufficient federalism $35. (August 5, 1966) for the issuance of
implications to require consultations or (1) Title of Information Collection: passports to U.S. nationals.
warrant the preparation of a federalism Application for a U.S. Passport. The issuance of U.S. passports
summary impact statement. The (2) OMB Control Number: 1405–0004. requires the determination of identity,
regulations implementing Executive (3) Type of Request: Revision of a nationality, and entitlement with
Order 12372 regarding Currently Approved Collection. reference to the provisions of Title III of
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intergovernmental consultation on (4) Form Number: DS–11. the Immigration and Nationality Act
federal programs and activities do not (5) Respondents: Individuals or (INA) (8 U.S.C. 1401–1504), the 14th
apply to this regulation. Households. Amendment to the Constitution of the
(6) Estimated Number of Respondents: United States, other applicable treaties
Executive Order 13175 11,763,831. and laws, and implementing regulations
The Department determined that this (7) Estimated Number of Responses: at 22 CFR parts 50 and 51. The specific
proposed rulemaking will not have 11,763,831. regulations pertaining to the
tribal implications, will not impose (8) Average Time per Response: 85 Application for a U.S. passport are at 22
substantial direct compliance costs on Minutes. CFR 51.20 through 51.28.

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64092 Federal Register / Vol. 81, No. 181 / Monday, September 19, 2016 / Proposed Rules

Methodology Facility/Passport Agency. The form Authority: 8 U.S.C. 1101 note, 1153 note,
must be completed and executed at an 1183a note, 1351, 1351 note, 1714, 1714 note;
The information collected on the DS–
acceptance facility or passport agency, 10 U.S.C. 2602(c); 11 U.S.C. 1157 note; 22
11 is used to facilitate the issuance of
and submitted with evidence of U.S.C. 214, 214 note, 1475e, 2504(a), 2651a,
passports to U.S. citizens and nationals.
citizenship and identity. 4201, 4206, 4215, 4219, 6551; 31 U.S.C. 9701;
The primary purpose of soliciting the Exec. Order 10,718, 22 FR 4632 (1957); Exec.
information is to establish citizenship, List of Subjects in 22 CFR Part 22 Order 11,295, 31 FR 10603 (1966).
identity, and entitlement to the issuance Consular services, Fees, Passports.
of the U.S. passport or related service, ■ 2. Revise item 1 in the table
Accordingly, for the reasons stated in
and to properly administer and enforce ‘‘Schedule of Fees for Consular
the preamble, 22 CFR part 22 is
the laws pertaining to the issuance Services’’ in § 22.1 to read as follows:
proposed to be amended as follows:
thereof.
Passport Services collects information PART 22—SCHEDULE OF FEES FOR § 22.1 Schedule of fees.
from U.S. citizens and non-citizen CONSULAR SERVICES— * * * * *
nationals when they complete and DEPARTMENT OF STATE AND
submit the Application for a U.S. FOREIGN SERVICE
passport. Passport applicants can either
download the DS–11 from the Internet ■ 1. The authority citation for part 22 is
or obtain one from an Acceptance revised to read as follows:

SCHEDULE OF FEES FOR CONSULAR SERVICES
Item No. Fee

Passport and Citizenship Services

1. Passport Book or Card Execution: Required for first-time applicants and others who must apply in person (Applicants ap-
plying for both the book and card simultaneously on the same application pay only one execution fee.) ............................. $35

* * * * * * *

Dated: July 31, 2016. exemption for records in this system Posting of Public Comments: Please
Patrick F. Kennedy, from certain provisions of the Privacy note that all comments received are
Under Secretary for Management. Act pursuant to 5 U.S.C. 552a(j) and (k). considered part of the public record and
[FR Doc. 2016–22215 Filed 9–16–16; 8:45 am] Public comment is invited. made available for public inspection
BILLING CODE 4710–13–P DATES: Comments must be received by online at http://www.regulations.gov
October 19, 2016. and in the Department’s public docket.
Such information includes personally
ADDRESSES: Address all comments to identifying information (such as your
DEPARTMENT OF JUSTICE the U.S. Department of Justice, ATTN: name, address, etc.) voluntarily
Privacy Analyst, Office of Privacy and submitted by the commenter.
28 CFR Part 16 Civil Liberties, National Place Building, If you want to submit personally
[CPCLO Order No. 008–2016] 1331 Pennsylvania Avenue NW., Suite identifying information (such as your
1000, Washington, DC 20530–0001 or name, address, etc.) as part of your
Privacy Act of 1974; Implementation facsimile 202–307–0693. To ensure comment, but do not want it to be
AGENCY: Federal Bureau of proper handling, please reference the posted online or made available in the
Investigation, United States Department CPCLO Order No. on your public docket, you must include the
of Justice. correspondence. You may review an phrase ‘‘PERSONALLY IDENTIFYING
ACTION: Notice of proposed rulemaking.
electronic version of the proposed rule INFORMATION’’ in the first paragraph
at http://www.regulations.gov, and you of your comment. You must also place
SUMMARY: Elsewhere in this issue of the may also comment by using that Web all personally identifying information
Federal Register, the Federal Bureau of site’s comment form for this regulation. you do not want posted online or made
Investigation (FBI), a component of the When submitting comments available in the public docket in the first
United States Department of Justice electronically, you must include the paragraph of your comment and identify
(‘‘Department’’ or ‘‘DOJ’’), has published CPCLO Order No. in the subject box. what information you want redacted.
a notice of a new Privacy Act system of Please note that the Department is If you want to submit confidential
records, ‘‘FBI Insider Threat Program requesting that electronic comments be business information as part of your
Records (ITPR),’’ JUSTICE/FBI–023. In submitted before midnight Eastern comment, but do not want it to be
this notice of proposed rulemaking, the Daylight Savings Time on the day the posted online or made available in the
FBI proposes to exempt this system comment period closes because http:// public docket, you must include the
asabaliauskas on DSK3SPTVN1PROD with PROPOSALS

from certain provisions of the Privacy www.regulations.gov terminates the phrase ‘‘CONFIDENTIAL BUSINESS
Act in order to avoid interference with public’s ability to submit comments at INFORMATION’’ in the first paragraph
efforts to detect, deter, and/or mitigate that time. Commenters in time zones of your comment. You must also
insider threats to national security or to other than Eastern Time may want to prominently identify confidential
the FBI and its personnel, facilities, consider this so that their electronic business information to be redacted
resources, and activities. For the reasons comments are received. All comments within the comment. If a comment has
provided below, the Department sent via regular or express mail will be so much confidential business
proposes to amend its Privacy Act considered timely if postmarked on the information that it cannot be effectively
regulations by establishing an day the comment period closes. redacted, all or part of that comment

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Document Created: 2016-09-17 02:30:24
Document Modified: 2016-09-17 02:30:24
Category		Regulatory Information
Collection		Federal Register
sudoc Class		AE 2.7: GS 4.107: AE 2.106:
Publisher		Office of the Federal Register, National Archives and Records Administration
Section		Proposed Rules
Action		Proposed rule.
Dates		The Department of State will accept comments on this proposed rule until November 18, 2016.
Contact		James McDaniel, Management Analyst, Office of the Comptroller, Bureau of Consular Affairs, Department of State; phone: 202-485-6694, telefax: 202-485-6826; email: [email protected]
FR Citation		81 FR 64088
RIN Number		1400-AD81
CFR Associated		Consular Services; Fees and Passports