Budget Calls For Increased Pesticide Fees

The Bush administration’s proposed budget for fiscal year 2007 has drawn concern from some in the pesticide industry. The budget would raise pesticide registration fees by $56 million, conflicting with current pesticide legislation.

“The president’s budget, if passed, will be very costly to the pesticide industry and could also devastate small and medium-sized management companies,” said Phil Klein, senior vice president of legislative affairs for Consumer Specialty Products Association. His trade association is a member of a coalition that will meet in the next few weeks to discuss efforts to lobby against the budget.

Besides being excessive, Klein said, the fees contradict the Pesticide Registration Improvement Act of 2003 (PRIA), which the administration passed with the support of industry and environmental groups. PRIA was enacted to build financial stability into the pesticide industry. It created a new fee system that structured payment, decision-making and review processes. The pesticide industry agreed to pay just under $200 million in fees over five years to the Environmental Protection Agency (EPA) in exchange for this system.

“It’s very important, from a business standpoint, to be able to have certain registration activity accomplished in a certain timeframe,” said Karen Reardon, director of communications and public relations for Responsible Industry for a Sound Environment (RISE). “[It helps] agricultural and non-agricultural growers know when new products are coming on the market.”

PRIA’s stability would have to adjust to any new fees. The legislation prohibited the EPA from collecting fees for tolerance – the amount of residue allowed on a product. The proposed budget calls for the collection of these fees, along with others, for the extension of maintenance charges and the operation of a registration review program. If these fees are implemented, PRIA would have to be amended, said Elizabeth Leovey, senior adviser of PRIA implementation for the EPA.

But pesticide fees are necessary, Reardon said, as long as they are reasonable and the pesticide industry benefits from them. Under PRIA, the EPA used those fees to fund pesticide programs. If new fees are enacted, she hopes they will serve the same purpose.

As those EPA programs have grown, the government has asked for more money. The budget outlines a need to pay for pesticide registration costs and EPA programs as the reason for the fee increase. The budget states that, “the administration has long maintained that the bulk of the costs associated with EPA’s pesticide activities should be covered by fees because pesticide registrants receive direct benefits from EPA’s services.” Those services include registering products, performing scientific risk assessments and evaluating the health impacts of pesticides.

The EPA’s services reach a wide range of industry companies, but so will potential fees, according to Bill Balek, director of legislative affairs for ISSA, a trade association for the cleaning industry.

“It’s fair to say that the fee increases [the government] is seeking are so sizeable that it will affect the whole industry, no matter the size of the business.”