ANIMAL AND PLANT HEALTH INSPECTION SERVICE (APHIS)
Docket ID: APHIS-2011-0003, Animal Welfare; Retail Pet Stores and Licensing Exemptions Final Rule
September 18, 2013 the final rule was published in the federal register. The rule went into effect November 18, 2013. Animal Care Hosted Webinars to Discuss the Retail Pet Store Rule and transcriptions of these webinars are posted on this page under the heading FILES AND RESOURCES ON NEW APHIS RULE.
The FINAL RULE is 91 pages long and is posted at the APHIS website. CLICK HERE TO ACCESS THE FILE
APHIS posted Regulatory Impact Analysis and Final Regulatory Flexibility Analysis. This document is the 2013 revised version of the initial analysis published in April 2012 along with the Rule. Also in the rule docket is the
Civil Rights Impact Analysis / Final Rule and 2012 Outreach Plan. December 2013 APHIS posted a Question and Answer sheet discussing the final rule. This sheet should be used only as a very basic guide. Checklist: Does APHIS' New Retail Pet Rule Impact Me? is supposed to help pet breeders decide if they must be licensed.
Decermber 2013 APHIS created a new, online form for the public to submit concerns about animals that are covered under the Animal Welfare Act (AWA), submit complaints against pet breeders, and report pet breeders who are not licensed. Anonymous complaints are accepted and all complaints are investigated.
Comments on the rule submitted in 2012 are still available for review.
APHIS published the Final Rule September 18, 2013 which revises the definition of "retail pet store" and brings historically exempt retail pet sellers under the Animal Welfare Act (AWA) licensing and regulation. The new definition of retail pet store means a place of business or residence where the seller, buyer, and animal are physically present in the same location. The transaction does not have to take place at the seller’s home. Previously, APHIS did not regulate any pet sales made directly to the retail consumer. APHIS stated the new rule completes a 2010 Office of the Inspector General (OIG) audit recommendation. In May, 2010, APHIS received severe criticism from the OIG regarding lax enforcement of currently licensed dog breeders in the report, "Inspections of Problematic Dealers". Included among recommendations for improvements at APHIS was one recommendation by OIG that the department seek Congressional legislation to regulate dog breeders selling via the Internet. APHIS later determined they had authority to regulate Internet sales without Congressional legislation. In 2011 Senators Richard Durbin and David Vitter wrote to USDA Secretary Tom Vilsack urging the agency to move forward "without requiring additional congressional action". APHIS also stated that the rule represented an appropriate response to the We the People petition submitted by HSUS to the White House demanding regulation.
WHO MUST BE LICENSED?
A USDA License is required for a Dealer, defined as any person who buys, or sells, or negotiates the purchase or sale of animals for pets for one of the following 6 uses:
Research, teaching, testing, experimentation, exhibition (to the public for compensation), use as a pet. A Dealer is also anyone who buys or sells dogs at the wholesale level for hunting, security, or breeding purposes.
All breeders who sell animals SIGHT UNSEEN and who maintain more than 4 breeding females must be licensed by the USDA. This includes the following list of pets: Dogs, cats, rabbits, guinea pigs, hamsters, gerbils, gophers, chinchilla, domestic ferrets.
In general, APHIS says this rule is driven by purpose of breeding and method of delivery for the sale; and the stated goal is to end sight unseen sales. Since most breeding programs do not fall into neat categories, this creates many gray areas of uncertainty. APHIS maintains that because of the varied situations, they will need to make case-by-case decisions regarding licensure. Of major concern is the interpretive definition of a breeding female. APHIS also states it must be assumed that any intact female or any female capable of breeding may be bred. Determination of whether or not a female on your property counts as a breeding female is solely at the discretion of APHIS inspectors. If you are trying to remain under 4 breeding females for the purpose of being able to ship, any intact females maintained on your premise for any length of time, such as for training or breeding, count toward the total number of females.
Anyone who maintains four or less breeding females of the same species and sells only the offspring of those females may sell pets either at retail or wholesale and may either ship or sell face-to-face without a license. Rescue groups that participate in face-to-face transactions such as off-site adoptions are subject to public oversight and therefore do not need to be licensed. However, rescue groups that ship or transport dogs to third parties for sale need to contact APHIS to discuss licensing requirements.
NOTE. The final rule raised many additional questions for breeders since most breeding programs do NOT fall into neat categories but encompass multiple levels of competition and types of sales; hunting dog kennels have variations as well with dogs used for more than one purpose. APHIS answered this confusion by stating that the agency will make individual determinations on whether a kennel requires licensing.
FARM BILL ACTION AND APHIS RULE UPDATES
During Conference Committee negotiations to resolve differences between the House and Senate versions of the farm bill, the Conferees formed a substitute bill. See report. The Conference substitute amended the Animal Welfare Act by providing that a dealer or exhibitor shall not be required to obtain a license as a dealer or exhibitor under this Act if the size of business is determined by the Secretary to be de minimus. The Conferees directed APHIS to complete a rulemaking expeditiously and suggested a timeframe not to exceed one year from the date of enactment in order that the agency begin receiving the benefit the policy provides related to resource allocation.
In addition, the Conferees stated, "The managers are aware of confusion among the regulated industry and request clarification of two principles pertaining to the sale of pets:
(1) Current regulatory language uses the term “breeding female” which does not appear in statute and thus lacks statutory direction. The Managers urge APHIS to clarify that only those female animals capable of reproduction and actively being used in a breeding program qualify as breeding females.
(2) The Managers also recommend clarifying that USDA oversight of such sales pertains to those transactions in interstate commerce as provided for under the Commerce Clause (U.S. Const. amend. I, § 8. )] [and as referenced in §2132 (c) of the Animal Welfare Act and regulated under authority of the United States department of Agriculture].
On Thursday, March, 13, 2014 APHIS held a Farm Bill Listening Session via teleconference to discuss the animal welfare provision in the bill that pertains to APHIS. Again there are no definite answers. HSUS went on record opposing any modifications to the APHIS Pet Seller Rule. HSUS also urged APHIS to issue a rule for regulation of bird dealers and exhibitors. To date there has been no announcement of an additional rule making process.
OPPOSITION LIST DELIVERED TO CONGRESS
Opposition List to APHIS Pet Sellers Rule
FILES AND RESOURCES ON NEW APHIS RULE
Docket No. 2011-003
Animal Welfare Act Integrated
TRANSCRIPT APHIS TELECONFERENCE MAY 10 FOR PROPOSED RULE
AKC. USDA/APHIS Finalizes Rule Impacting Pet Breeders
Living with USDA Licensing
United Kennel Club. How will the New USDA Changes Affect You?
American Kennel Club letter to APHIS October 24, 2013
SAOVA Commentary: Does APHIS have authority to enact this rule?
SAOVA Commentary: APHIS final rule revising pet sellers and you.
TRANSCRIPTS OF APHIS CONFERENCE CALLS
Transcription of the APHIS Conference Call September 10, 2013 announcing final rule
AKC transcription of call between APHIS and Sheila Goffe (AKC)
Transcription of APHIS Webinar November 14, 2013. How will USDA Implement the Retail Pet Store Rule
Transcription of APHIS Webinar November 21, 2013. How will USDA Implement the Retail Pet Store Rule
Transcription of APHIS Webinar December 5, 2013. How will USDA Enforce the Retail Pet Store Rule
Transcription of APHIS Listening Session March 13, 2014 regarding APHIS-related provisions of the 2014 Farm Bill
APHIS steadfastly maintained that the benefits from this rule would outweigh any costs. We disagree and believe that AHPIS has continually underestimated the numbers of breeders who will be impacted by this rule as well as cost to both breeders and the agency for implementation.
In the original 2012 analysis APHIS suggested 1,500 dog breeders would be newly licensed. This final rule summary noted, “There is a great deal of uncertainty surrounding the number of facilities that will be affected by this rule, as we acknowledged in the proposed rule, and as evidenced in the public comments.” According to a revised APHIS estimate, there could be as many as 15,000 online breeders who would likely be affected by this rule. APHIS maintained that only 75% of the pet breeders would sell some pets sight unseen and estimate the final number of new licensees would drop to approximately 4,640. However even this modest underestimate this still doubles the agency's current workload of inspecting licensed breeders.
In 2012 APHIS also stated that increasing the number of breeding females from 3 to 4 would possibly reduce current license holders by 31%. The final rule summary stated that APHIS expects the number of current licensees that will fall below the new exemption threshold will be very small. APHIS also acknowledged that neither the number of entities that will need to make changes nor the extent of those changes is known. Therefore, the overall cost of structural and operational changes that will be incurred due to this rule is also unknown. We believe APHIS has consistently underestimated the cost required for pet breeders to comply with this rule.
For the past several years, the APHIS budget has been shrinking; since 2010 the budget has decreased by approximately $87 million, or roughly 10 percent. The FY 2012 federal Budget contained appropriation for APHIS programs of $837 million, which was 8.3% or $76 million lower than the amount appropriated for APHIS in FY 2011.
Budget cuts are likely to continue into the foreseeable future. The President's 2013 budget request submitted in February to Congress called for a decrease in APHIS funding by an additional $54 million, or 6.6 percent.
There was little revision to the APHIS 2014 budget; the requested $798 million was an overall reduction of $24 million from 2013. Money requested specifically for Animal Welfare activities and enforcement was $29 million, an increase of only $1 million split between Animal Welfare and Horse Protection. Increase for Horse Protection was requested to $893,000 from current $500,000; therefore leaving virtually no additional funds to enact or enforce increased regulation of dog and pet breeders.
The APHIS 2015 budget request of $834 million is a reduction of about $8 million from the 2014 enacted level ($842M). Money budgeted specifically for Animal Welfare activities and enforcement is again $29 million.
Associated Dog Clubs of New York State (ADCNYS) is an AKC Federation of Dog Clubs with 56 member clubs in New York State. ADCNYS believed that opposing this rule on a legal basis was the best strategy for all clubs, organizations, businesses and individual breeders/owners. On December 16, 2013 a Lawsuit was filed in the Federal District Court in Washington DC that asked the Court to declare the Retail Pet Store Rule "arbitrary, capricious and inconsistent" with law, and to remand the Rule back to the USDA. The Lawsuit also sought an injunction that would bar the USDA from enforcing the Retail Pet Store Rule. The "Complaint" in the Lawsuit was filed on behalf of 42 Plaintiffs that consisted of Dog and Cat Clubs, Associations and a Registry. Those 42 Plaintiffs included nearly 19,000 breeders who potentially would be adversely affected by the Rule. Those 42 Plaintiffs represent less than 1% of the more than 5,500 Dog and Cat Clubs in the U.S., which supports the assertion that the Rule potentially affects far more than the 4,640 breeders that APHIS stated was the maximum number of breeders who potentially would be affected by the Rule. One of the cornerstone assertions in the Complaint is the fact that APHIS failed to document how it arrived at its figure of 4,640 breeders, which figure is exponentially below the number of hobby breeders who potentially could be affect by the Rule and failed to comply with the existing laws and regulations when it published the Retail Pet Store Rule ("Rule") in November 2013.
HSUS FILED MOTION TO INTERVENE AGAINST INJUNCTION
On December 30, 2013, HSUS formally filed a Motion to Intervene in the case, and its Motion with accompanying exhibits totaled over 100 pages. In the motion, HSUS stated, "The Final Rule is the culmination of years of effort on the part of The HSUS to bring about meaningful change to existing law. If Plaintiffs are successful in their efforts to set aside the Final Rule, The HSUS will suffer immediate and concrete harm." Wasting no time in their campaign against dog breeders, on January 7, 2014 HSUS filed a complaint with USDA demanding enforcement action against more than 50 commercial dog breeders who appear to be operating in violation of the new federal law.
NOVEMBER 2014 SUMMARY JUDGMENT GRANTED
US District Court Judge Christopher Cooper issued his opinion on the lawsuit. To our disappointment, Cooper granted summary judgment to USDA, dismissing the lawsuit and the plaintiff's claims. In his opinion Cooper stated that the plaintiff's complaints "are more policy disagreements with APHIS' regulatory approach than they are valid legal objections to APHIS’s authority and the process it followed in adopting the rule. Because APHIS acted within its authority in promulgating the rule and otherwise complied with the requirements of the Administrative Procedures Act, the Court will grant summary judgment for the agency."
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