Federal Register / Vol. 75, No. 56 / Wednesday, March 24, 2010 / Proposed Rules 14111 

58The Commission recognizes that there may be 

regional limitations on the amount of demand-side 

management, or other technically capable 

resources, that can be reliably employed. Any 

modifications proposed to the Commission must 

allow regional discretion to make this 

determination based on the technical issues 

inherent to those regions. 

59 5 CFR 1320.11. 

60 44 U.S.C. 3507(d). 

61Regulations Implementing the National 

Environmental Policy Act of 1969, Order No. 486, 

FERC Stats. & Regs. ¶ 30,783 (1987). 

62 18 CFR 380.4(a)(2)(ii). 

63 5 U.S.C. 601–612. 64See 13 CFR 121.201. 

Operating Reserve-Supplemental to 

provide for the inclusion of other 

technologies that could reliably 

contribute to operating reserves, 

including demand-side management.58

IV. Information Collection Statement 

48. The Office of Management and 

Budget (OMB) regulations require that 

OMB approve certain reporting and 

recordkeeping (collections of 

information) imposed by an agency.59

The information contained here is also 

subject to review under section 3507(d) 

of the Paperwork Reduction Act of 

1995.60 By remanding the proposed 

Reliability Standard the Commission is 

maintaining the status quo until future 

revisions to the Reliability Standard are 

approved by the Commission. Thus, the 

Commission’s proposed action does not 

add to or increase entities’ reporting 

burden. 

V. Environmental Analysis 

49. The Commission is required to 

prepare an Environmental Assessment 

or an Environmental Impact Statement 

for any action that may have a 

significant adverse effect on the human 

environment.61 The Commission has 

categorically excluded certain actions 

from this requirement as not having a 

significant effect on the human 

environment. Included in the exclusion 

are rules that are clarifying, corrective, 

or procedural or that do not 

substantially change the effect of the 

regulations being amended.62 The 

actions proposed herein fall within this 

categorical exclusion in the 

Commission’s regulations. 

VI. Regulatory Flexibility Act 

Certification 

50. The Regulatory Flexibility Act of 

1980 (RFA) 63 generally requires a 

description and analysis of final rules 

that will have significant economic 

impact on a substantial number of small 

entities. The RFA mandates 

consideration of regulatory alternatives 

that accomplish the stated objectives of 

a proposed rule and that minimize any 

significant economic impact on a 

substantial number of small entities. 

The Small Business Administration’s 

Office of Size Standards develops the 

numerical definition of a small 

business.64 For electric utilities, a firm 

is small if, including affiliates, it is 

primarily engaged in the transmission, 

generation and/or distribution of 

electric energy for sale and its total 

electric output for the preceding twelve 

months did not exceed four million 

megawatt hours. The RFA is not 

implicated by this proposed rule 

because by remanding the proposed 

Reliability Standard the Commission is 

maintaining the status quo until future 

revisions to the Reliability Standard are 

approved by the Commission. 

VII. Comment Procedures 

51. The Commission invites interested 

persons to submit comments on the 

matters and issues proposed in this 

notice to be adopted, including any 

related matters or alternative proposals 

that commenters may wish to discuss. 

Comments are due May 24, 2010. 

Comments must refer to Docket No. 

RM09–15–000, and must include the 

commenter’s name, the organization 

they represent, if applicable, and their 

address in their comments. 

52. The Commission encourages 

comments to be filed electronically via 

the eFiling link on the Commission’s 

Web site at http://www.ferc.gov. The 

Commission accepts most standard 

word processing formats. Documents 

created electronically using word 

processing software should be filed in 

native applications or print-to-PDF 

format and not in a scanned format. 

Commenters filing electronically do not 

need to make a paper filing. 

53. Commenters that are not able to 

file comments electronically must send 

an original and 14 copies of their 

comments to: Federal Energy Regulatory 

Commission, Office of the Secretary, 

888 First Street, NE., Washington, DC 

20426. 

54. All comments will be placed in 

the Commission’s public files and may 

be viewed, printed, or downloaded 

remotely as described in the Document 

Availability section below. Commenters 

on this proposal are not required to 

serve copies of their comments on other 

commenters. 

VIII. Document Availability 

55. In addition to publishing the full 

text of this document in the Federal 

Register, the Commission provides all 

interested persons an opportunity to 

view and/or print the contents of this 

document via the Internet through 

FERC’s Home Page (http://www.ferc.gov) 

and in FERC’s Public Reference Room 

during normal business hours (8:30 a.m. 

to 5 p.m. Eastern time) at 888 First 

Street, NE., Room 2A, Washington, DC 

20426. 

56. From FERC’s Home Page on the 

Internet, this information is available on 

eLibrary. The full text of this document 

is available on eLibrary in PDF and 

Microsoft Word format for viewing, 

printing, and/or downloading. To access 

this document in eLibrary, type the 

docket number excluding the last three 

digits of this document in the docket 

number field. 

57. User assistance is available for 

eLibrary and the FERC’s Web site during 

normal business hours from FERC 

Online Support at 202–502–6652 (toll 

free at 1–866–208–3676) or e-mail at 

ferconlinesupport@ferc.gov, or the 

Public Reference Room at (202) 502– 

8371, TTY (202) 502–8659. E-mail the 

Public Reference Room at 

public.referenceroom@ferc.gov. 

By direction of the Commission. 

Nathaniel J. Davis, Sr., 

Deputy Secretary. 

[FR Doc. 2010–6477 Filed 3–23–10; 8:45 am] 

BILLING CODE 6717–01–P 

DEPARTMENT OF STATE 

22 CFR Part 22 

[Public Notice: 6928] 

RIN 1400–AC57 and 1400–AC58 

Schedule of Fees for Consular 

Services, Department of State and 

Overseas Embassies and Consulates 

AGENCY: Department of State. 

ACTION: Supplemental notice of 

proposed rulemaking. 

SUMMARY: The Department of State 

(‘‘Department’’) published two proposed 

rules in the Federal Register on 

December 14, 2009, and February 9, 

2010, proposing to amend the Schedule 

of Fees for Consular Services. In this 

supplemental proposed rule, the 

Department of State is providing 

additional supplementary information 

regarding the Cost of Survey Study 

(CoSS), the activity-based costing model 

that the Department used to determine 

the fees for consular services proposed 

in. The Department is also re-opening 

the comment periods on both proposed 

rules for an additional 15 days. 

DATES: Written comments must be 

received on or before 15 days from the 

date of publication in the Federal 

Register. 


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14112 Federal Register / Vol. 75, No. 56 / Wednesday, March 24, 2010 / Proposed Rules 

ADDRESSES: Interested parties may 

submit comments by any of the 

following methods: 

• Persons with access to the Internet 

may view this notice and submit 

comments by going to the 

regulations.gov Web site at: http:// 

www.regulations.gov/index.cfm. 

• Mail (paper, disk, or CD–ROM): U.S. 

Department of State, Office of the 

Executive Director, Bureau of Consular 

Affairs, U.S. Department of State, Suite 

H1001, 2401 E Street, NW., Washington, 

DC 20520. 

• E-mail: fees@state.gov. You must 

include the RIN (either 1400–AC57 or 

1400–AC58, or both) in the subject line 

of your message. 

FOR FURTHER INFORMATION CONTACT: Rob 

Kline, Office of the Comptroller, Bureau 

of Consular Affairs, phone (202) 663– 

2513. E-mail: fees@state.gov. 

SUPPLEMENTARY INFORMATION: 

Background 

The Department of State 

(‘‘Department’’) published two proposed 

rules in the Federal Register on 

December 14, 2009 (74 FR 66076, Public 

Notice 6851, RIN 1400–AC57), and on 

February 9, 2010 (75 FR 6321, Public 

Notice 6887, RIN 1400–AC58), 

proposing to amend sections of part 22 

of Title 22 of the Code of Federal 

Regulations, the Schedule of Fees for 

Consular Services. The Department’s 

proposed rules solicited comments, and 

a number of comments requested 

additional detail on the Consular 

Services Cost of Service Study (CoSS) as 

well as time to comment on that detail. 

In response, the Department is 

providing the additional written detail 

below. 

Additional Detail on the Cost of Service 

Study 

Activity-Based Costing Generally 

Office of Management and Budget 

(OMB) Circular A–25 states that it is the 

objective of the United States 

Government to ‘‘(a) ensure that each 

service, sale, or use of Government 

goods or resources provided by an 

agency to specific recipients be selfsustaining; [and] (b) promote efficient 

allocation of the Nation’s resources by 

establishing charges for special benefits 

provided to the recipient that are at least 

as great as costs to the Government of 

providing the special benefits * * *.’’ 

OMB Circular A–25, ¶ 5(a)–(b); see also 

31 U.S.C. 9701(b)(2)(A) (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 

* * *.’’). To set prices that are ‘‘selfsustaining,’’ the Department must 

determine the true cost of providing 

consular services. Following guidance 

provided in Statement #4 of OMB’s 

Statement of Federal Accounting 

Standards (SFFAS), 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 the services 

listed in its Schedule of Fees, both those 

whose fee the Department proposes to 

change, as well as those whose fee will 

remain unchanged from prior years. The 

Department refers to the specific ABC 

model that underpins the proposed fees 

in the above-referenced rules as the 

‘‘Cost of Service Study’’ or ‘‘CoSS.’’ 

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 precisely 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.’’ 

Example: Imagine a government agency 

that has a single facility it uses to prepare 

and issue a single product—a driver’s 

license. In this simple scenario, every cost 

associated with that facility (the salaries of 

employees, the electricity to power the 

computer terminals, the cost of a blank 

driver’s license, etc.) can be attributed 

directly to the cost of producing that single 

item. If that agency wants to ensure that it 

is charging a ‘‘self-sustaining’’ price for 

driver’s licenses, it only has to divide its total 

costs for a given time period by an estimate 

of the number of driver’s licenses to be 

produced during that same time period. 

However, if that agency issues multiple 

products (driver’s licenses, non-driver ID 

cards, etc.), has employees that work on other 

activities besides licenses (for example, 

accepting payment for traffic tickets), and 

operates out of multiple facilities it shares 

with other agencies, it becomes much more 

complex for the agency to determine exactly 

how much it costs to produce any single 

product. In those instances, the agency 

would need to know what percent of time its 

employees spend on each service and how 

much of its overhead (rent, utilities, facilities 

maintenance, etc.) are consumed in 

delivering each service to determine the cost 

of producing each of its various products— 

the driver’s license, the non-driver ID card, 

etc. Using an ABC model would allow the 

agency to develop those costs. 

Components of Activity-Based Costing 

As noted in SFFAS Statement #4, 

‘‘activity-based costing has gained broad 

acceptance by manufacturing and 

service industries as an effective 

managerial tool.’’ SSFAS Statement #4, 

¶ 147. There are no ‘‘off-the-shelf’’ ABC 

models that allow the Department (or 

any other entity) to simply populate a 

few data points and generate an answer. 

ABC models require financial and 

accounting analysis and modeling skills 

combined with a detailed understanding 

of all the organization’s business 

processes, which, in an entity the size 

of the Department’s Bureau of Consular 

Affairs, are exceedingly complex. More 

specifically, ABC models require an 

organization to: 

• Identify all of the activities that are 

required to produce a particular product 

or service (‘‘activities’’); 

• Identify all of the resources 

consumed (costs) in the course of 

producing that product or service 

(‘‘resources’’); 

• Measure the quantity of resources 

consumed (‘‘resource driver’’); and 

• Measure the frequency and 

intensity of demand placed on activities 

to produce services (‘‘activity driver’’). 

For more information, SFFAS 

Statement #4 provides a detailed 

discussion of the use of cost accounting 

by the U.S. Government. 

Example: To consume a peanut butter and 

jelly sandwich, a person might engage in 

multiple activities: grocery shopping, 

sandwich making, sandwich eating, and 

kitchen cleaning. Each of these activities 

consumes resources: grocery shopping, for 

example, requires gas to drive to the store, 

time to make the trip, and money to buy the 

peanut butter, jelly, and bread. A person 

might be able to make 25 peanut butter and 

jelly sandwiches with a single jar of peanut 

butter; as a result, the resource driver for 

peanut butter would be 1/25th of a jar of 

peanut butter. If a person chooses to eat two 

peanut butter and jelly sandwiches at a meal, 

the activity driver for ‘‘kitchen cleaning’’ 

would be 1⁄2 since the person would eat two 

sandwiches, but only have to clean the 

kitchen once. 

Although the Department has used a 

sophisticated and detailed ABC model 

to set fees for a number of years, in its 

October 10, 2007, report ‘‘Transparent 

Cost Estimates Needed to Support 

Passport Execution Fee Decisions,’’ 

available at http://www.gao.gov/ 

products/GAO–08–63, the GAO asked 

the Department to expand the 

sophistication of its cost model by 

identifying even more discrete activities 

and modeling a broader array of 

products and services. To provide this 

additional detail, the Department 

launched a multi-year plan to refine the 

CoSS with the help of a team of 

experienced outside consultants led by 

The QED Group, LLC, and including 

Booz Allen Hamilton, Inc. as a 


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subcontractor. The consultant team was 

made up of experts in cost modeling 

capable of providing an objective, 

outside assessment of costs. 

Consular Service Activities 

Working with its consultants, the 

Department reviewed all of its consular 

operations and identified 262 distinct 

activities—including 77 visa-specific 

activities, 11 passport-specific activities, 

58 activities specific to overseas citizen 

services, and 116 cross-cutting activities 

(such as cashiering, fraud prevention, 

and public affairs outreach). This list 

includes more than five times as many 

activities than the Department’s cost 

model from the prior CoSS, which broke 

out 52 activities. The Department 

provides the following examples of 

some of the activities that make up a 

consular operation to illustrate the 

substantial complexity that the CoSS 

must be capable of taking into account: 

• Processing a passport book (Items 1, 

2a/2b, and 2g of the proposed Schedule 

of Fees). Fifty-two separate CoSS 

activities are required to process a firsttime application for a passport book, 

including the following actions: 

—Public outreach, such as maintaining 

passport information on the 

Department’s Web site (http:// 

travel.state.gov) and operating 

appointment systems for our passport 

agencies; 

—Answering phone and written 

inquiries from the public regarding 

passport rules and pending 

applications; 

—Nine separate activities related to data 

entry of applications, from capturing 

applicant photos and processing 

payment to supervisor audits of the 

process; 

—Investigation of and coordination with 

federal law enforcement on 

potentially fraudulent applications; 

—Actual adjudication of the 

application; 

—Production of the personalized 

passport itself; and 

—Archiving completed applications for 

future reference. 

• Adding additional visa pages to a 

passport (Item 2c of the proposed 

Schedule of Fees). Among the 51 

activities involved in adding additional 

pages to a passport are the following: 

—Receiving the application and 

entering data from it into the system; 

—Performing a name check for the 

applicant and reviewing the results to 

determine if there any legal 

impediments to providing the service, 

such as an outstanding federal 

warrant for the applicant’s arrest; 

—Physically affixing the pages to the 

passport; and 

—Auditing of the process by a 

supervisor. 

• Processing a non-petition-based 

machine-readable nonimmigrant visa 

(MRV) (Item 21a of the proposed 

schedule of fees). Ninety-nine CoSS 

activities are required in processing an 

application for a non-petition-based 

MRV, such as a tourist visa, including: 

—Public outreach, such as responding 

to public inquiries as to the status of 

MRV applications; 

—Conducting an interview of the MRV 

applicant; 

—Collecting biometrics from the MRV 

applicant; 

—Actual adjudication of the 

application; 

—Requesting advisory opinions from 

attorneys at headquarters regarding 

how specific laws and regulations 

apply to complicated applications; 

—Requesting security advisory opinions 

from headquarters about applicants 

the consular officer believes may 

present a risk to U.S. national 

security; 

—Investigating possible fraud in those 

applications; and 

—Producing the actual, physical visa, 

affixing it to the applicant’s passport, 

and returning that product to the 

applicant. 

• Processing a fiance ́(e) (K category) 

MRV (Item 21d). One hundred and three 

CoSS activities are required to process 

an application for a K1-category 

fiance ́(e) nonimmigrant visa, including: 

—Pre-processing of the case at the 

National Visa Center, where the 

petition is received from the 

Department of Homeland Security, 

packaged and assigned to the 

appropriate embassy or consulate; and 

—Intake and review of materials 

required for a K visa that are not 

required for other nonimmigrant 

visas, such as the I–134 affidavit of 

support and the DS–2054 medical 

examination report; 

—Conducting an interview of the K visa 

applicant; 

—Collecting biometrics from the K visa 

applicant; 

—Actual adjudication of the 

application; 

—Requesting legal opinions from 

headquarters as necessary; 

—Investigating possible fraud in those 

applications; and 

—Producing the physical visa, affixing 

it to the applicant’s passport, and 

returning that product to the 

applicant. 

• Processing a letter rogatory (Item 

51). Sixty CoSS activities are required to 

service a request for a letter rogatory, 

covering actions including: 

—Receipt of the request at headquarters 

and dispatch of a telegram to an 

embassy or consulate instructing that 

the service be initiated; 

—Preparation of a diplomatic note to be 

sent to the appropriate foreign 

government; and 

—Monitoring the case as it progresses 

through foreign government channels, 

and regularly updating the customer 

on the status of the case. 

By taking the 52 activities from the 

prior CoSS and breaking them down 

further into 262 activities in the current 

CoSS, the Department was able to model 

its costs much more precisely. As a 

result, the Department was able to 

identify differences in both resource 

drivers and activity drivers that had 

previously been obscured. For example, 

the Department has better data now on 

how much additional time a consular 

officer spends on reviewing the case file 

for a K fiance ́(e) visa (resource driver) as 

well as how much more frequently an 

officer seeks assistance from fraud 

prevention resources as part of a K visa 

application (activity driver) compared to 

a standard tourist visa application. Not 

surprisingly, this additional detail has 

dramatically increased the complexity 

of the CoSS because the Department 

now matches costs with activities at a 

more granular level. 

Determining the Cost of Performing 

Each Consular Activity 

After defining each activity, the 

Department used the CoSS model to 

determine the total costs to perform that 

activity. As noted in SFFAS Statement 

#4, ‘‘[d]epending on feasibility and costbenefit considerations, resource costs 

may be assigned to activities in three 

ways: (a) Direct tracing; (b) estimation 

based on surveys, interviews, or 

statistical sampling; or (c) allocations.’’ 

SSFAS Statement #4, ¶ 149(2). 

Direct trace costs are quite obvious 

and easy to identify. For the activities 

listed above they include, for example, 

what the Department pays for each 

physical passport book, the paper 

affixed to the book of a customer who 

requests additional pages, or the visa 

foil that is placed into an applicant’s 

passport. 

Determining how to assign other types 

of costs to activities is much more 

difficult than direct trace costs since an 

employee or resource may be involved 

in many different activities or processes. 

To give a few examples from among the 

large number of factors that go into 

determining ‘‘assigned costs’’ for the 

scores of consular services, such costs 

would include how much time a 

passport specialist spent to adjudicate a 

particular passport application; how 


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much time a passport agency employee 

spent processing payment for a 

passport; how much time another 

employee spent performing a qualitycontrol check on this and other passport 

work; how much time a consular officer 

at an embassy or consulate spent 

interviewing a visa applicant, and 

another employee spent taking the 

applicant’s fingerprints; how much time 

that officer then spent adjudicating the 

visa application; how much time the 

fraud unit spent investigating whether 

bank documents submitted in a visa 

application are fraudulent; and how 

much time legal staff at headquarters 

spent determining whether an 

individual’s claim to citizenship is 

adequately documented. 

Finally, the third set of costs, 

allocated costs, is neither obvious nor 

easy to trace. With assigned costs, the 

entire amount is counted as a consular 

cost and the decision is what share of 

that cost should be assigned to what 

activity. In determining allocated costs, 

only a portion of the whole are included 

in the model because only that portion 

can be assigned to consular activities. 

One example of this is the Department’s 

Bureau of Human Resources, which 

provides services to all of the 

Department. The CoSS model includes 

only a portion of that Bureau’s costs, 

based on the percentage of Department 

employees who perform consular work. 

To provide another example, when 

considering the cost to keep a particular 

facility (embassy, consulate, passport 

agency, etc.) functioning, the 

Department first determined what 

portion of that facility is used to provide 

consular services, and then allocated 

within the CoSS model how much of 

that smaller amount should be charged 

to the activities associated with 

providing a given customer with a given 

service—such as a passport or a 

nonimmigrant visa—at that location. 

The Department estimates that, on the 

whole, 19.6% of its consular costs are 

direct trace, 60.7% are assigned costs, 

and the remaining 19.7% are allocated 

costs, although the exact breakdown of 

these costs varies by activity. Given that 

such a high percentage of the 

Department’s costs are assigned or 

allocated costs, the Department devoted 

substantial efforts to modeling these 

costs. 

Assigning Costs 

To assign labor costs, the Department 

relied on a variety of industry standard 

estimation methodologies. For example, 

the Department analyzed passport 

agency task reports to determine how 

much time passport specialists working 

at a passport agency devote to particular 

tasks—for example, time spent serving 

customers in the window versus time 

spent in training or performing 

administrative duties versus time spent 

actually adjudicating passports. To 

estimate how much time consular 

officers overseas spend on consular 

activities, the Department asked 

consular officers at 200 overseas posts to 

complete a 98-question survey. This 

survey asked Consular Affairs personnel 

to break out the time they spend on each 

consular activity they perform during a 

typical month—visa interviews, visa 

adjudication, passport adjudication, 

performing welfare and whereabouts 

visits, responding to judicial assistance 

requests from American citizens abroad, 

notarizing documents for American 

citizens abroad, issuing consular reports 

of birth abroad, and so forth. The 

responses to the survey were then used 

to develop resource drivers to assign 

labor costs to activities. To give one 

example, in the survey responses, 

foreign service national (FSN) 

employees in Mumbai, India, indicated 

that as a whole they spent 6,586 hours 

on consular activities in a typical 

month, of which 955 hours (14.5% of 

their time) were spent on performing 

nonimmigrant visa application intake. 

Total annual compensation for Mumbai 

FSNs was $783,988. Based on the 

percentage calculated above, 14.5% of 

their compensation, or $113,678, was 

calculated as the cost of this one activity 

for this one post for this one labor 

category. 

To assign activity costs to the 

individual services, the Department 

extracted volume data by product type 

from its data systems. For example, to 

determine how to assign the costs of 

adjudicating nonimmigrant visas, the 

Department analyzed the volume of 

nonimmigrant visas issued by category 

(B, H, K, L, and so forth) for a given time 

period, which in turn became the 

activity driver for this data. For 

activities at embassies and consulates 

abroad, this volume data is collected 

from the ‘‘Consular Package’’ every 

consular section submits annually via 

the Internet-based Consular Workload 

Statistics System (CWSS). For more than 

30 years, the Consular Package has been 

the single most important document 

consular managers use to report, plan, 

and budget for consular operations, and 

is the key document linking consular 

objectives to resource and personnel 

requirements. CWSS collects and 

evaluates data from 239 individual 

consular sections in consulates and 

embassies worldwide, and provides 

customizable reports of available data. 

CWSS is designed to provide the most 

comprehensive picture of each post’s 

consular operations and cumulatively of 

embassies and consulates by region and 

worldwide. It provides an overview of 

the volume and nature of the embassy’s 

or consulate’s consular workload; 

personnel and work hours devoted to it; 

the challenges faced; and the outlook for 

the future. These reports yield a wealth 

of data and are an exceptionally 

valuable management tool for 

determining consular resource needs. 

Volume data for all consular services 

the Department provides at its 

embassies and consulates overseas— 

passport and citizenship services, 

emergency services to American 

citizens, nonimmigrant and immigrant 

visa services, judicial services, etc.—is 

captured from the CWSS. Using the 

Mumbai example above, the costs for 

the processing of nonimmigrant visa 

application intake activity were 

assigned to nonimmigrant visas 

according to volume by visa category, as 

collected from the CWSS—an activity 

driver referred to as ‘‘nonimmigrant visa 

applications.’’ Of the 253,394 

nonimmigrant visas issued in Mumbai 

during FY 2008, 209,120 (82.5%) of 

them were ‘‘base MRVs,’’ that is nonpetition-based nonimmigrant visas 

(excluding the E category). Thus, 82.5% 

of the FSN costs for this activity 

($93,784 of the $113,678 total) were 

assigned to ‘‘base MRVs’’ for this one 

cost element. 

For consular activities that take place 

in the United States, the Department 

collects volume data from periodic 

workload reports pertaining to the 

passport or visa facilities in question. 

For example, for volume data on the 

processing of passport applications or 

requests for additional pages submitted 

to one of the many passport agencies in 

cities across the United States, the 

Department collects volume data from 

monthly workload reports pulled from 

the passport management information 

system, a management database. 

After collecting and analyzing all 

available cost and workload data, the 

Department converted this raw data into 

resource drivers and activity drivers for 

each resource and activity. The resulting 

14-gigabyte database constitutes the 

CoSS model. Because the CoSS is a 

complex series of iterative computer 

processes incorporating more than a 

million calculations, it cannot itself be 

reduced to a tangible form such as a 

document, notwithstanding the use of 

the word ‘‘study’’ in the term ‘‘cost of 

service study.’’ 

The final component required to 

determine unit costs is ‘‘scenario 

planning,’’ described in the following 

section. 


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Scenario Planning 

Scenario planning allowed the 

Department to predict levels of future 

demand for specific services and 

evaluated their impact on unit costs. 

Without scenario planning, an activitybased costing model can only determine 

historical costs, or how much it cost to 

produce something in the past. As there 

is no mechanism for the Department to 

charge retroactive fees to recipients of 

prior services, and in accordance with 

OMB objectives, the Department 

endeavors to determine a ‘‘selfsustaining’’ price for future service 

delivery. OMB Circular A–25, ¶ 5(a). 

Through scenario planning, the 

Department can convert historical data 

about service costs into forward-looking 

estimates of how much a service will 

cost in the future. 

Private industry has significantly 

greater flexibility in altering its 

personnel and overhead costs based on 

changes in demand than do government 

agencies. As roughly 70% of the 

workforce involved in providing 

consular services are full-time federal 

employees, if demand for a service falls 

precipitously, the Department cannot 

shed employees as quickly as the 

private sector. (For that matter, should 

demand rise precipitously, the 

Department cannot add employees as 

quickly, since delivering the vast 

majority of consular services requires 

specially trained employees, and these 

persons cannot begin their training until 

they have completed the federal hiring 

process and passed a security 

clearance.) Additionally, given 

government procurement rules and 

security requirements, the Department 

commits to many of its facilities and 

infrastructure costs years before a 

facility comes online. Even if demand 

changes, the Department is still 

obligated to cover these costs. As a 

result, when setting fees, the 

Department must assume that the 

majority of its short-term costs cannot 

drop significantly. 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,’’ and forecasting 

demand becomes crucial. 

Example: In the original example above 

involving the issuance of driver’s licenses, 

assume that the agency is obligated to spend 

$1 million per year on staff and facilities 

costs regardless of how many applicants 

apply for a driver’s license. If that agency 

believes 100,000 people will apply for a 

driver’s license next year, then charging $10 

for each driver’s license would be a ‘‘selfsustaining’’ fee. However, if only 75,000 

people actually applied for a $10 driver’s 

license, the agency would face a $250,000 

budget shortfall (or 25% of its total budget). 

If the agency had known in advance that 

demand was more likely to be 75,000 people 

in the next year, it could have set a selfsustaining price of $13.33 for each license. 

The Department devotes significant 

internal resources to monitoring current 

demand for consular services and 

forecasting future demand. After 

reviewing its own historical data and 

conferring with its CoSS consultants 

from the team led by The QED Group, 

the Department developed a range of 

demand scenarios for each service or 

product that it ran through its model. 

From this range, the Department 

deliberated and, based on historical 

demand and experience, chose the most 

likely demand scenario for each service 

or product. It then used this demand 

scenario to populate the final version of 

the CoSS. 

These estimates took into account, 

among other factors, the likely impact of 

the global economic downturn on 

demand for consular services. 

Using the activities listed above as 

examples, the Department forecasted 

that it will receive in FY 2010: 

—A total of 13,618,092 applications for 

passport products, an 18.5% decrease 

from actual figures in FY 2008, the 

last full year available to the 

Department at the time it modeled the 

fees proposed in the rules at issue in 

this notice, and a year in which 

impending Western Hemisphere 

Travel Initiative (WHTI) 

implementation resulted in very high 

demand; 

—217,576 applications for extra 

passport pages, a 5.3% decrease from 

FY 2008 due to the post-WHTI 

decrease in overall demand for 

passport products; 

—5,787,040 applications for 

nonimmigrant visas that do not 

require a petition, a 10.6% decrease 

from FY 2008 due to the addition of 

eight countries to the Visa Waiver 

Program and the effects of the global 

economic downturn; 

—98,077 applications for K1-category 

fiance ́(e) visas, a 10.7% decrease from 

FY 2008 due to the decrease in overall 

demand for visas resulting from the 

global economic downturn; 

—543 requests for processing of letters 

rogatory and Foreign Sovereign 

Immunities Act (FSIA) judicial 

assistance cases, a 20.9% increase 

from FY 2008 based on the historical 

rates of increase for judicial services 

requests. 

Running the Data Through the CoSS 

Model 

The costs the Department entered into 

the CoSS model included every line 

item of costs for the Department, 

including items such as physical 

material for making passports and visas, 

salaries, rent, supplies, travel, and so 

forth. The Department then determined 

a resource driver (from, for example, the 

responses to the overseas survey, data 

from the passport agency task report, 

etc.) for each of these costs, as discussed 

in the ‘‘Assigning Costs’’ section above, 

and entered the resource drivers and 

assignments into the model. This 

allowed the model to calculate the 

activity cost for each activity. The 

Department then selected an activity 

driver, such as the volume data from 

CWSS discussed above, for each 

activity, in order to assign these costs to 

each service type. This process allowed 

the model to calculate a total cost for 

each of the Schedule of Fees’ line items 

for visa services, passport services, and 

overseas citizen services. The model 

then divided 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 for 

the historical base year. Projected cost 

increases for predictive years were also 

included to take account of changes 

inter alia in the size of consular staff, 

the exchange rates, inflation, and cost of 

living factors. At this stage, the final 

demand projections discussed in the 

‘‘Scenario Planning’’ section above were 

applied to each appropriate element in 

the model using business rules that 

allowed the model to project unit costs 

for future years. The calculation of these 

costs allowed the Department to 

determine the appropriate fee to 

propose. As this series of calculations 

demonstrates, the CoSS is an extremely 

complex yet comprehensive model that 

captures historical costs while 

attempting to predict future costs based 

on the Department’s best knowledge and 

predictive abilities. 

Conclusion 

Based on the information outlined 

and explained above, the Department 

believes these fees are entirely 

consistent with the objective in OMB 

Circular A–25 to ‘‘promote efficient 

allocation of the Nation’s resources by 

establishing charges for special benefits 

provided to the recipient that are at least 

as great as costs to the Government of 

providing the special benefits * * *.’’ 

OMB Circular A–25, ¶ 5(b). The 

Department takes seriously its 

obligation to be a good steward of public 

resources (including user fees) and 


sroberts on DSKD5P82C1PROD with PROPOSALS
14116 Federal Register / Vol. 75, No. 56 / Wednesday, March 24, 2010 / Proposed Rules 

understands clearly the important role it 

plays in encouraging and enabling 

international trade and commerce. 

As noted above, the Department 

determined its proposed fees using a 

federally approved fee-setting model— 

activity-based costing—developed with 

the assistance of independent 

professional consultants experienced in 

activity-based cost modeling, and 

believes that these proposed fees will be 

self-sustaining when implemented. 

Moreover, the Department continues to 

refine and update the CoSS so it can 

regularly monitor its fees and make 

adjustments as required to continue to 

set fees commensurate with what it 

costs the Department to provide the 

service in question. 

Dated: March 18, 2010. 

Patrick F. Kennedy, 

Under Secretary of State for Management, 

Department of State. 

[FR Doc. 2010–6490 Filed 3–23–10; 8:45 am] 

BILLING CODE 4710–06–P 

ENVIRONMENTAL PROTECTION 

AGENCY 

40 CFR Part 52 

[EPA–R05–OAR–2007–0587; FRL–9130–1] 

Approval of Implementation Plans of 

Wisconsin: Nitrogen Oxides 

Reasonably Available Control 

Technology 

AGENCY: Environmental Protection 

Agency (EPA). 

ACTION: Proposed rule. 

SUMMARY: EPA is proposing to approve 

revisions to the Wisconsin State 

Implementation Plan (SIP) submitted on 

June 12, 2007 and on September 14, 

2009. These revisions incorporate 

provisions related to the 

implementation of nitrogen oxides 

(NOX) Reasonably Available Control 

Technology (RACT) for major sources in 

the Milwaukee-Racine and Sheboygan 

ozone nonattainment areas. EPA is 

proposing to approve SIP revisions that 

address the requirements found in 

section 182(f) of the Clean Air Act 

(CAA). EPA is also proposing to approve 

other miscellaneous rule changes that 

affect NOX regulations that were 

previously adopted and approved into 

the SIP. 

DATES: Comments must be received on 

or before April 23, 2010. 

ADDRESSES: Submit your comments, 

identified by Docket ID No. EPA–R05– 

OAR–2007–0587, by one of the 

following methods: 

1. http://www.regulations.gov: Follow 

the on-line instructions for submitting 

comments. 

2. E-mail: damico.genevieve@epa.gov. 

3. Fax: (312) 385–5501. 

4. Mail: Genevieve Damico, Acting 

Chief, Criteria Pollutant Section, Air 

Programs Branch (AR–18J), U.S. 

Environmental Protection Agency, 77 

West Jackson Boulevard, Chicago, 

Illinois 60604. 

5. Hand Delivery: Genevieve Damico, 

Acting Chief, Criteria Pollutant Section, 

Air Programs Branch (AR–18J), U.S. 

Environmental Protection Agency, 77 

West Jackson Boulevard, Chicago, 

Illinois 60604. Such deliveries are only 

accepted during the Regional Office 

normal hours of operation, and special 

arrangements should be made for 

deliveries of boxed information. The 

Regional Office official hours of 

business are Monday through Friday, 

8:30 a.m. to 4:30 p.m., excluding 

Federal holidays. 

Instructions: Direct your comments to 

Docket ID No. EPA–R05–OAR–2007– 

0587. EPA’s policy is that all comments 

received will be included in the public 

docket without change and may be 

made available online at http:// 

www.regulations.gov, including any 

personal information provided, unless 

the comment includes information 

claimed to be Confidential Business 

Information (CBI) or other information 

whose disclosure is restricted by statute. 

Do not submit through http:// 

www.regulations.gov or e-mail, 

information that you consider to be CBI 

or otherwise protected. The http:// 

www.regulations.gov Web site is an 

‘‘anonymous access’’ system, which 

means EPA will not know your identity 

or contact information unless you 

provide it in the body of your comment. 

If you send an e-mail comment directly 

to EPA without going through http:// 

www.regulations.gov, your e-mail 

address will be automatically captured 

and included as part of the comment 

that is placed in the public docket and 

made available on the Internet. If you 

submit an electronic comment, EPA 

recommends that you include your 

name and other contact information in 

the body of your comment and with any 

disk or CD–ROM you submit. If EPA 

cannot read your comment due to 

technical difficulties and cannot contact 

you for clarification, EPA may not be 

able to consider your comment. 

Electronic files should avoid the use of 

special characters and any form of 

encryption and should be free of any 

defects or viruses. For additional 

information about EPA’s public docket 

visit the EPA Docket Center homepage 

at http://www.epa.gov/epahome/ 

dockets.htm. 

Docket: All documents in the 

electronic docket are listed in the 

http://www.regulations.gov index. 

Although listed in the index, some 

information is not publicly available, 

i.e., CBI or other information whose 

disclosure is restricted by statute. 

Certain other material, such as 

copyrighted material, is not placed on 

the Internet and will be publicly 

available only in hard copy form. 

Publicly available docket materials are 

available either electronically in http:// 

www.regulations.gov or in hard copy at 

the Environmental Protection Agency, 

Region 5, Air and Radiation Division, 77 

West Jackson Boulevard, Chicago, 

Illinois 60604. This facility is open from 

8:30 a.m. to 4:30 p.m., Monday through 

Friday, excluding Federal holidays. We 

recommend that you telephone Douglas 

Aburano, Environmental Engineer, at 

(312) 353–6960, before visiting the 

Region 5 office. 

FOR FURTHER INFORMATION CONTACT: 

Douglas Aburano, Environmental 

Engineer, Criteria Pollutant Section, Air 

Programs Branch (AR–18J), 

Environmental Protection Agency, 

Region 5, 77 West Jackson Boulevard, 

Chicago, Illinois 60604, (312) 353–6960, 

aburano.douglas@epa.gov. 

SUPPLEMENTARY INFORMATION: 

Table of Contents 

I. What Action Is EPA Proposing To Take? 

II. W hat Are the NOX RACT Requirements? 

III. Analysis of Wisconsin’s NOX RACT 

Submittal 

IV. Proposed Action 

V. Statutory and Executive Order Reviews 

I. What Action Is EPA Proposing To 

Take? 

Throughout this document wherever 

‘‘we,’’ ‘‘us,’’ or ‘‘our’’ are used, we mean 

EPA. 

NOX RACT Approval 

EPA is proposing to approve revisions 

to Wisconsin’s SIP, submitted on June 

12, 2007 and on September 14, 2009. 

The CAA amendments of 1990 

introduced the requirement for existing 

major stationary sources of NOX in 

nonattainment areas to install and 

operate NOX RACT. Specifically, section 

182(b)(2) of the CAA requires States to 

adopt RACT for all major sources of 

volatile organic compounds (VOC) in 

ozone nonattainment areas; section 

182(f) extends the RACT provisions to 

major stationary sources of NOX. 

Wisconsin was not required to adopt 

NOX RACT rules under the 1-hour 

ozone standard because all of the ozone 

nonattainment areas in Wisconsin were 


sroberts on DSKD5P82C1PROD with PROPOSALS