Grass Carp Inspection and Certification Program
Southeast Region

 

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Standard Penalties and Fees for Program Non-Conformance

Revised vice Memorandum of Agreement 2010, Amended August 2010

The National Triploid Grass Carp inspection and Certification Program (NTGCICP) has become formalized under the auspices of a Memorandum-of-Agreement (MOA) between the USFWS and Cooperating Triploid Grass Carp (TGC) Producers. This MOA was originally requested by Triploid Grass Carp Producers, and implemented through the cooperation of TGC-Producers, states, and USFWS Inspectors, to ensure that the NTGCICP functions with very high quality. Producers and USFWS Inspectors were concerned that a few non-conforming TGC Producers could someday damage the reputation of high quality TGC-Producers, and denigrate the integrity of the NTGCICP. Accordingly, USFWS entered into a NTGCICP review process that included substantial legal oversight. The USFWS considered the inputs from TGC-Producers and Inspectors, and brought findings and information before legal counsel (Department of Interior, Wash DC). The National Standards for the NTGCICP were subsequently revised to align with the tenets of the MOA, and thus strengthen the overall Quality Assurance of the Program. Among these revisions include another set of National Standards for the NTGCICP --- “Standard Penalties and Fees for Program Non-Conformance.”

A number of changes in the triploid grass carp industry and the National Triploid Grass Carp Inspection and Certification Program (NTGCICP) have resulted in reductions in type A (diploid) failures over the last decade. Some factors identified as contributing to the reduced ploidy-failure rates include the following: 1) Implementation of an incremental penalty-fee structure for the NTGCICP to provide a disincentive for producers that did not conform to National Standards. 2) Producer use of flow cytometry to screen groups of larval grass carp to identify and cull grass carp sub-populations having greater than 10% diploids. 3) Refinements in grass carp screening and improved handling procedures at producer sites to improve QA/QC. The combination of these factors and others has resulted in improved quality control over the last ten years.

As the National inspection program has grown it has become necessary to refine the current standards to reflect changes in the industry since its inception. With the legal review of the program, associated with development of the MOA, and input from producers on the need for clear guidance on how to perform successfully in the program we have defined penalties that could be imposed for inadequate performance. We have updated the standards and defining guidelines for violations of the standards. The goal of the new regulations is to establish a platform that is rigorous enough to terminate undesirable participation of rogue entrepreneurs who do not meet the requirements of the NTGCICP. Therefore, the USFWS proposes a new set of quality assurance standards that involve fees and penalties, and can lead to termination of the MOA. The new quality assurance criteria have been given legal review and changes have been made that are considered to be reasonable and equitable. USFWS will work with TGC-Producers and States to ensure that the NTGCICP retains the highest integrity standards. The USFWS will enforce quality assurance aspects of the NTGCICP and ensure that quality control is consistent throughout the United States. All signatories to this MOA should recognize the significance of the changes being made to requirements within the NTGCICP, and make adjustments to their internal operational practices, if so needed, to meet the new conditions and requirements.

Failure Types (Click for more information)
1. Type A Failure
  • Diploids found during a triploid grass carp inspection.
  • The USFWS recognizes that a Type-A (Diploid) failure is inevitable, due to the complexity of operations and human error. Nevertheless, the USFWS must strive to enforce quality assurance programs that keep Type-A Failures to a minimum. Thus the fees start at higher dollar levels than traditional fees, and quickly accelerate to even higher levels. Moreover, repetitive Type-A failures in a calendar year will lead to inspection suspensions, change of MOA status to provisional, with further restrictions, higher fines and potential TERMINATION of the MOA.
Quality Assurance Fee Schedule for Type-A Failures is identified below:
1st Failure $500 Fee & Warning
2nd Failure $500 Fee plus 2-Work-Day Suspension Or $2000 fee
3rd Failure $1000 Fee plus 10-Consecutive-Day Suspension Or $5,000 fee
4th Failure $1000 Fee plus 30-Consecutive-Day Suspension Or $10,000 fee
5th Failure Provisional status initiated $1,000 Fee and 30 day suspension or $10,000 fee
Provisional Status $1000 fee and 30 day suspension or $10,000 fee per violation

See provisional status below. Each year the schedule for type A failures will reset unless the producer is in provisional status.

Question 1: “When does the First Year begin, for purposes of the MOA?”

  • Washington Office Legal Guidance determined that year begins on the date when the MOA is signed by the last Signatory – this would be the date which puts the MOA into effect, or acknowledges the date of effect. Under normal circumstances the MOA will be scheduled for renewal on January 1 every three years.

Question 2: “How would a 2-work-day suspension take effect? Would a 10 or 30 consecutive-day suspension be dealt with differently?”

  • The 2-day suspension, would involve the loss of Inspection and Certification Privileges for two regular (Monday thru Friday, but Non-Holiday) work days.

Example: If a TGC-Producer’s second Type-A Failure occurred on a Thursday, the result would be as follows:

  • Inspector reports Type-A failure on inspection checklist, and informs producer the non -compliance fee is due within 3 business days or collects $500-fee.
  • Producer would acknowledge failure by signing the Verification Checklist for Triploid Grass Carp Inspections.
  • Inspector departs site and notifies Supervisor in writing.
  • Inspector notifies Producer with standardized letter of warning that subsequent failures would become more severe and could lead to termination.
  • The producer addresses the letter of warning and replies back to the Inspector /Administrator detailing corrective actions to mediate the violation.
  • An inspection could be rescheduled once identified lot had been retested.
  • Producer’s next inspection could be after 2-working days has lapsed.
  • For Thursday scenario the options would be as follows:
    • If no holidays, the next inspection could be Tuesday
    • (Friday and Monday would be workdays for suspension)
    • (Holiday on Fri, Mon, or Tue would adjust inspection to Wed)

The duration of 10-day and 30-day suspensions would be determined differently. USFWS determined that the suspension of inspection and certification privileges would be immediate, and remain in effect for either 10 or 30 consecutive days. These consecutive days include both weekend days (Sat & Sun) and holidays.

Non- Conformance Fee Option

If the producer chooses to substitute the failure fee for a suspension then funds would be due within 3 business days and will be placed into a separate fund for quality assurance. The Inspector will issue a letter of warning/concern to the producer. The producer addresses the letter of warning/concern and replies back to the Inspector /Administrator detailing corrective actions to mediate the violation. Once the non-conformance fee’s are paid the inspection can be rescheduled within 48 hrs provided all conditions on the checklist are met and the identified lot of fish failing the inspection is rechecked.

Provisional Status

If a producer has five type A failures in one year they will be placed into a provisional status for the remainder of the MOA where the fines for type A failures are much higher. Each additional failure will result in a $10,000 fee, or 30 day suspension and a $1000 fee. Continued poor performance leading to five failures in any 12 month period remaining in the MOA could result in termination of the MOA. The producer can appeal the MOA Termination by writing to the original USFWS signatory-office, requesting a review of the decision. A tribunal process would examine the issues and render a decision. Performance of producers will be evaluated at the end of the MOA for adherence to the standards and maintaining an operation with good QA/QC.

Credit for Exceptional Performance

A Quality Assurance incentive program has been developed that will allow producers to earn credit to off-set the impact of suspensions or fees. TGC-producers that have an excellent history with respect to type A failures can gain and use Quality Assurance credits. Up to two QA-Credits can be carried into the next year, and up to one can be carried into the next MOA renewal. Producers can accumulate no more than 2 credits. This system will provide an added financial buffer for producers that generally do an excellent job but have a temporary glitch in their system. It would be the Producer’s prerogative to save the QA- Credit or to use the QA-Credit to “freeze” the associated fees or suspension of their next Type-A violation at the same level as their last Type-A violation.

Producers with no failures for 35 consecutive inspections will be issued a letter of credit by the inspector that will be held on file. These earned credits can be held for the term of the MOA and be used to offset the penalties associated with a failure. The producer can choose to use the credit any time during the MOA to offset penalties associated with a failure except the fifth and final penalty in a given year that would result in placement of the producer in Provisional Status. When in provisional status the producer cannot use the QA credits to offset penalties associated with a failure. See Appendix 1 for examples of potential QA/QC credit scenarios.


2. Type B Failure
  • Non-functioning equipment prevents the completion of a scheduled triploid grass carp ploidy verification inspection.
  • Producers with aging equipment or even new equipment that suffers damage (lightning, power surge, water damage, etc) will on occasion have equipment failures that prevent completion of the inspection. This fee structure has been traditionally used to offset costs for the inspector’s loss of time and/or realization of additional travel costs.
  • The USFWS considered the traditional fee structure to be a sufficient negative-incentive for producers, and thus encourage them to invest time and dollars to ensure that ploidy readings are accurate and that equipment can validly distinguish between diploids, triploids, and latex-bead standards. Should the USFWS question the accuracy of readings the inspector will require the TGC-producer to “run” additional standards. If the producer’s equipment fails to read the standards correctly, the inspection will cease until ploidy detection equipment is operating accurately. Producers will be issued a letter of concern for each occurrence of a type B failure. For the purposes of the MOA, the Type-B Failure (Equipment) fee structure will be as per scenario below:
    • Failure-1 @ $100
    • Failure-2 @ $200
    • Failure-3 @ $300
    • Failure-4 @ $400
    • Failure-5 @ $500
    • Failure-6 @ $500
  • Each year the equipment failure schedule will reset.
  • The Year will begin on the date the MOA was last signed, or determined to go into effect.

Definition of Type C Failures:

If an inspector arrives at the producers facility and the checklist inaccurately reflects the conditions on site the inspector will cancel the inspection and issue a letter of concern or warning defining the circumstances creating the non-conformance with the standards.(Example : Producer marks on the checklist that all fish have been individually tested and “poke “ marks are visible . If the inspector arrives and sub-samples the fish and no mark is visible on fish the inspection will be cancelled.) A $500 fee will be collected to compensate the program for costs associated with travel and salary for the inspector. Inspections can be rescheduled within 48 hrs provided the condition identified in the letter is resolved. The letters will be retained on file for the duration of the MOA. If a clear pattern emerges of non-conformance with program standards this may be grounds for non-renewal of the MOA.

3. Type C Failure
  • Certified Triploid Grass Carp or alleged 100% individually producer tested triploid grass carp are not in isolated vat 100-feet from Grass Carp production ponds.
  • It is imperative that the Producer-Tested triploids and Certified Triploid fish be isolated from unscreened mixed populations of grass carp to minimize cross contamination.
  • The isolation area for segregating Tested Grass carp should be a minimum distance of 100-feet from any fish pond. This helps to ensure undesired transfers of fish or other non-target species. Existing operations can opt to screen their grass carp holding building if in closer proximity to a pond. If a producer is developing new holding facilities for certified grass carp they will ensure that the building with holding vats are a distance of 100-ft from the production ponds. Prior to initiating an MOA, USFWS Inspectors will examine site conditions and measure distances of holding facilities from production ponds and distances for segregating fish lots to preclude cross-contamination. If an inspector observes uncontrolled movements of fish by birds or other predators, in the triploid grass carp isolation area the inspector will discuss situation with the producer and ask that a solution be developed.

4. Type C Failure
  • Diploid and Triploid Grass Carp are not isolated from each other, and their tanks/vats are not labeled.
  • Facility layout and fish handling procedures are generally different at all producer facilities and must be handled and assessed on an individual basis. Regardless of the building set-up, grass carp brought into the building are individually tested, and populations of presumptive 100% triploids are segregated for subsequent verification testing by USFWS Inspectors. It is important to establish handling procedures e.g. screening of tanks, and tank labeling, that minimizes accidental mixing of grass carp as different groups of fish are subsequently handled by personnel. This should generally not be a problem as issues will be identified during the initial assessment of the facility by USWFS Inspectors prior to setting up the MOA. If producers decide to change their handling procedures after establishing the MOA, the inspector and producer will need to reach consensus on the change to ensure that there is no negative impact on the integrity of the NTGCICP.
  • Diploid fish found during the TGC-producer’s ploidy test will be removed from the isolation area that holds certified triploids, (they may be temporarily isolated within a segregated labeled "diploid tank.”). Diploid grass carp, or untested grass carp from ponds, must be located at least 6 feet away from vats/tanks holding alleged 100% producer-tested triploid grass carp, or the vats of certified triploid grass carp ready for shipment. Because the NTGCICP recognizes four different management populations, producers will need to consider appropriate management scenarios to isolate these populations.
  • Producers are required to identify these populations using different tank labels supplied by the USFWS:
    • USFWS Certified Triploid Grass Carp
    • Presumptive Triploid Grass Carp (100% Ploidy Tested by Producer)
    • Untested Grass Carp (fish from ponds)
    • Diploid Grass Carp (Controls)

5. Type C Failure
  • All presumptive triploid fish do not have visible evidence of producer ploidy testing (a poke mark on the isthmus) when inspector arrives.
  • For several years inspectors have examined a few fish from each lot to be inspected for a visible cut on the isthmus from collection of blood for triploid analysis. Generally, the mark is clearly visible on fish. Moreover, preliminary pilot tests verified the persistence of a visible mark. Nevertheless, there are new lancets, needles, etc that might produce slightly different results. The standardized location for blood-sampling will be the isthmus (under “chin”). Blood taking will be evaluated at each location with the goal of validating a mark that persists for at least ten-days. Having a standardized blood sampling location provides a starting point for quality control at the producer site, and also during transit for people who want to “spot-check” triploid grass carp being transferred to other locations. Before this “poke-mark” can be used as a criterion for mandatory MOA compliance requirements further testing will be required to determine the persistence of the marks at different facilities. MOA requirements will be determined if and when results are subsequently verified through conclusive research. Letters of concern and warning will be issued for non-compliance with this standard without fees until research is completed.

Definition of Type D Failures:

Producer will be required to comply with the inspector’s interpretation of onsite conditions concerning these standards and will have the opportunity to correct the non-conformance to continue the inspection. If the producer refuses to make required changes the inspector will issue a letter of concern or warning, collect the non-conformance fee and leave the facility without inspecting the identified lot. The letters will be retained on file for the duration of the MOA. If a producer violates a type D failure four times in a year this may be grounds for non-renewal of the MOA.

6. Type D Failure
  • Fish are not maintained in an identifiable location during the inspection for possible retesting.
  • When performing a USFWS Grass Carp Inspection, individual fish will be secured by the TGC-producer in an identifiable location for possible retesting if any fish is suspected of being a diploid. The fish can only be released after the USFWS Inspector confirms the ploidy status. A site specific protocol for handling suspect fish will be developed for each facility and must be followed when initiated by the inspector.
  • During the inspection process if a suspect diploid is observed by the inspector, the producer must have provisions to keep the suspect fish isolated and available for retesting, or the resultant ploidy determination will be based on the observation of the original sample in the sample vial.
  • If there is any handling confusion during an inspection (such as suspect fish being dropped and replaced by another fish) the Inspector will at his/her discretion fail the inspection. If there is a repeated pattern of fish being unavailable for retesting, then penalties under the MOA will be enforced. The inspector has the pre-approved authority from the TGC-Producer (through signatory of the MOA) to stop the inspection’s ploidy verification process at any time, and spot check any fish. Moreover, the Inspector has the authority to “spot-check” any aspect of the whole inspection procedure as defined under the MOA and National Standards for NTGCICP.

7. Type D Failure
  • Producer selects the 120 fish sample for the ploidy verification inspection without the supervision/direction of the USFWS Inspector. In order to avoid penalties the producer must return fish to the holding tank and allow the inspector to select and examine fish from the identified lot of fish.
  • Historically, some TGC-Producers had collected and isolated a group of 120 fish from the individually ploidy-tested population prior to the arrival of the USFWS inspector. They did this to expedite the completion of the inspection because of busy schedules or because buyers were awaiting delivery of fish for transport. This situation would require additional time for the inspection, since the Inspector had to subsequently make the determination of which 120 grass carp would be selected for the verification testing procedure. Accordingly, preselection of fish by a TGC-Producer is unacceptable, as it bypasses several steps in the inspection process.
  • Communication with TGC-Producer employees is the responsibility of the TGC-Producer and should be done at the time the producers representative is filling out the “Verification Checklist for Triploid Grass Carp Inspections form.”

8. Type D Failure
  • Inspector unable to visually estimate numbers and confirm composition of alleged 100% individually producer tested grass carp population in holding vats due to poor water clarity.
  • The number of fish in a lot is reported by the producer and the inspector must be able to visually confirm the number of fish the producer indicates is in a lot prior to issuing certificates. The goal of segregating fish into groups is to observe relative numbers, size conformity, and general condition of health. The ability to observe the fish is required for the visual confirmation of the number of fish in the lot as well and to confirm that no other species are present in the lot indicating potential adulteration of the alleged 100% triploid lot. If turbid water quality is clearly temporary and associated with a unique weather event the inspector will work with producer to ensure that the number of fish alleged to be in a lot is confirmed without overly stressing the fish.
  • If a producer refuses to accommodate the inspector during unique and temporary water clarity event for any reason the inspection will be cancelled and a non-conformance fee will apply. When dealing with temporary and unique water events producers should call the inspector in route to cancel the inspection if they are uncomfortable handling fish under the existing water quality conditions in order to avoid non-conformance fees.

Definition of Type E Failures:

Type –E failures do not carry a monetary fee as they are not directly related to the actual inspection where the inspector is required to travel to the site. These violations cover issues dealing with unethical business procedures and handling of paperwork. In many cases violations of these standards can result in immediate termination from the program if substantiated. In most cases termination will require a legal adjudication process to terminate the MOA.

9. Type E Failure
  • Number of fish on the bill of lading/invoice does not match the number of fish on the ploidy certificate. Producer fails to follow protocol for reducing number of fish on a certificate.
  • State law enforcement /management had expressed concern when number of triploid grass carp marked on certificates was less than the number of fish in the tanks during spot inspections. This concern might be appropriately realized when triploid and diploid grass carp are being legally shipped on the same truck through states that accept diploid grass carp. The total numbers of grass carp might not match the certification because only the USFWS verified-certified triploids would be reported on the Certificate. Additionally, over the last few years Certificates have been modified (Embossed, et al.) and procedures have been established to allow the producer to reduce numbers of fish on certificates to match the exact number of fish on the bill of lading. If the USFWS inspector receives a formal complaint from a state that indicates that the number of fish on a certificate does not match the number of USFWS certified fish on the bill of lading the producer will be asked to write a written explanation for the record. The explanation must reconcile any reported transgression to the MOA requirements.
  • When it is necessary to reduce the number of fish in a shipment (Buyer suddenly calls and cancels 20% of the sale just prior to shipment), the TGC-Producer is required to report exact numbers for Certificate. Accordingly, the TGC-Producer would report the exact numbers (by reducing the numbers on the Certificate by 20%). The Producer will sign and emboss the change on the original Certificate, before the Certificate and triploid grass carp are released to the truck driver. Number of certified grass carp identified on the bill of lading will match that on the combined certificates for that purchaser.

10. Type E Failure
  • Producer is convicted of falsification of a ploidy Certificate, an inspector's embossment, or signature on a ploidy certificate.
  • The integrity of the program is dependent on the adherence of the producers and inspectors to the standards established for the NTGCICP. Falsification of certificates is a major transgression deserving of MOA termination if proven by law to be the work of a participating producer. {Example: If Certificates are improperly copied, or certificate has been modified and embossed with equipment not provided by USFWS, or if someone falsely signs/forges a certificate with the name of a USFWS Inspector, the result will be immediate termination of the MOA.

11. Type E Failure
  • Producer is convicted of bribery charges filed by the USFWS.
  • Producers having difficulty adhering to the standards established for the NTGCICP, may be faced with potential fees and/or penalties that can impact their livelihood, or lead to termination of the MOA. Under such duress a TGC-Producer might be tempted to try to bribe the USFWS Inspector to overlook a failed inspection, or ask the Inspector to overlook another infraction of the NTGCICP policies. If the Inspector reports an attempt at bribery, and it is validated, then the MOA for that producer will immediately be terminated.

12. Type E Failure
  • Intimidation or use of inappropriate language toward an inspector.
  • Inspectors and producers are expected to interact in a professional and courteous manner. If either party feels intimidated or insulted during the inspection, he/she should clearly express their concerns to the other party in writing. If either party continues to feel intimidated the immediate supervisor for the inspector will review documentation from both parties and write a letter of warning outlining expected outcomes. If the behavior continues the program supervisor will interview both parties and make a determination on the best course of action. A formal letter will be sent out outlining the expected outcome from discussions. The producer and inspector will sign the letter agreeing to the terms of behavior. If this fails to resolve the issue an independent tribunal will be convened to examine the case and make recommendations on the best course of action that could include termination of the MOA.

13. Type E Failure
  • Producer is convicted for fraudulently selling non certified grass carp as USFWS certified triploids in intrastate or interstate shipments.
  • Selling uncertified grass carp as USFWS certified triploid grass carp clearly compromises the integrity of the NTGCICP. If NTGCICP TGC-producers are suspected of conducting this type of business the USFWS and others in the NTGCICP will communicate and work with state law enforcement to obtain evidence to prosecute the offender. If a NTGCICP-participating producer is determined by law to be a direct participant in the fraudulent sale of grass carp, the MOA will be terminated immediately.

14. Type E Failure
  • Conviction of a Lacey Act Felony violation related to movement of Triploid/Diploid grass carp.
  • Any TGC-Producer who might be investigated and prosecuted for interstate transport of grass carp in violation of state grass carp regulations puts the NTGCICP in jeopardy due to loss of NTGCICP integrity. Accordingly, the USFWS will pay close attention to allegations made by parties that can impact the NTGCICP. Additionally, should a TGC-Producer become convicted of a Lacey Act Felony, the MOA will be terminated immediately.
  • If the TGC-Producer is convicted of a Lacey Act misdemeanor charge, the circumstances of the case will be reviewed by law enforcement and a NTGCICP tribunal to weigh the severity of the charges with respect to the integrity of the inspection program. The penalty will be commensurate with the transgression, and imposed after due legal consultation.

15. Type E Failure
  • Producer fails to pay the USFWS at the negotiated rate for services rendered.
  • Producers are expected to pay fees at the time of service or in accordance with established procedures agreed to by both parties. If checks are returned for insufficient funds the producer will be informed in writing of the problem by certified mail and is expected to make immediate arrangements for payment. If producer fails to make payment within 10 business days of receiving notice, a 30 consecutive day suspension of service will be initiated. If arrangements have not been made for payment by the end of the 30 day suspension, the MOA will be terminated and all inspections will cease.

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Last updated: June 5, 2013