Agency will publish a correction in the FEDERAL REGISTER at a later date.

§ 701.41 Definitions.

The following definitions set forth the parameters for determining FOIA fees:

(a) Direct costs. Direct costs means those expenditures a naval activity actually incurs in searching for, reviewing (in the case of commercial requesters), and duplicating documents to respond to a FOIA request. Direct costs include, for example, the salary of the employee performing the work (the employee's basic rate of pay plus 16 percent of that rate to cover benefits), and the costs of operating duplicating machinery. Not included are overhead expenses such as costs of space, heating, or lighting the facility where records are stored.

(b) Search time. Search time includes all time spent looking for material responsive to a request and a page-bypage or line-by-line identification (if necessary) of material in the document to determine if it, or portions thereof, are responsive to the request. Naval activities should ensure that searches are efficient and completed in the least expensive manner to minimize costs to the naval activity and the requester. For example, naval activities should not do a line-by-line search when duplicating an entire document containing responsive information would be less expensive and quicker to comply with the request. Time spent reviewing documents to determine whether to apply one or more of the statutory exemptions is not search time, but review time.

(c) Duplication. Duplication refers to the process of making a copy of a document in response to a FOIA request. Copies can be paper copy, microfiche, audiovisual, or machine readable documentation (e.g., magnetic tape or disc). Every effort will be made to ensure that the copy provided is in a form reasonably usable by requesters. If copies are not clearly usable, the requester will be notified that their copy is the best available and the agency's master copy will be made available for review upon appointment. For duplicating of computer tapes and audiovisuals, the cost, including the operator's time

shall be charged. If a naval activity estimates that assessable duplication charges may exceed $25, it shall notify the requester of the estimate, unless the requester has indicated in advance his or her willingness to pay fees as high as those anticipated. Such notice shall offer the requester the opportunity to confer with naval personnel to reformulate the request to meet his or her needs at a lower cost.

(d) Review. Review time refers to examining documents responsive to a FOIA request to determine whether one or more of the statutory exemptions permit withholding. It also includes processing the documents for disclosure, such as excising them for release. Review does not include time spent resolving general legal or policy issues on applying the exemptions. Charges may be assessed only for the initial review. Naval activities may not charge for reviews during an administrative appeal of an exemption already applied. Records or portions of records withheld in full under an exemption subsequently determined not to apply, may be reviewed again to determine the applicability of other exemptions not previously considered and the costs for such a subsequent review could be assessed.

(e) Commercial use request. A commercial use request is a request from or on behalf of one seeking information for a use or purpose that furthers the commercial, trade, or profit interest of the requester. In determining whether a requester belongs to this category, naval activities must determine the requester's use of the documents requested. Naval activities should seek additional clarification before assigning the request to a specific category when doubting the intended use of the requester, or where the use is not clear from the request itself.

(f) Educational institution. An educational institution is a preschool, public or private elementary or secondary school, institution of graduate higher education, institution of undergraduate higher education, institution of professional education, and an institution of vocational education operating a program(s) of scholarly research.

(g) Non-commercial scientific institution. A non-commercial scientific institution is operated solely for conducting scientific research the results of which are not intended to promote any particular product or industry and not operated on a "commercial" basis.

(h) Representative of the news media. Representative of the new media is a person actively gathering news for an entity organized and operated to publish or broadcast news to the public. "News" means information about current events or of current interest to the public. Examples of news media entities include television or radio station broadcasting to the public at large and publishers of periodicals when qualifying as disseminators of "news" who make their products available for purchase or subscription by the general public. Those examples are not all-inclusive. As traditional methods of news delivery evolve (e.g., electronic dissemination of newspapers through telecommunications services) alternative media would be included in this category. "Free-lance" journalists may be considered as working for a news organization if they can demonstrate a basis for expecting publication by that organization, even if not actually employed. Proof may be by publication contract, but naval activities may also look to the requester's past publication record in making this determination. Representatives of the news media do not include private libraries, private repositories of Government records, or middlemen such as information vendors or data brokers.

(i) All other requesters. All other requesters refers to persons who do not qualify as an educational institution, non-commercial scientific institution, representative of the news media, or commercial use requester. An example is a nonprofit organization.

§ 701.42 Application.

(a) Commercial requesters. When records are requested for commercial use, fees shall be assessed to recover reasonable standard charges for document search, review, and duplication. Requesters must reasonably describe the records sought. When naval activities review a request for documents for commercial use, they should assess

charges which recover the full direct costs of searching for, reviewing for release, and duplicating duplicating the records sought. Commercial requesters, are not entitled to 2 hours of free search time and 100 free pages of reproduction of documents. However, fees totaling $15 or less must be waived. Commercial requesters are not normally entitled to a waiver or reduction of fees based upon an assertion that disclosure would be in the public interest. Because use of the requested material is the exclusive determining criteria, a commercial enterprise may make a request that is not for commercial use. It is also possible that a nonprofit organization could make a request for commercial use. Such situations must be addressed on a case-by-case basis.

(b) Educational institution requesters. When a request is made by an educational institution whose purpose is scholarly research fees shall be limited to reasonable standard charges for document duplication (excluding charges for the first 100 pages). Requesters must reasonably describe the records being sought and must show that the request is made under the auspices of a qualifying institution and that the records are not sought for commercial use, but in furtherance of scholarly research.

(c) Non-commercial scientific institution requesters. When the request is made by a non-commercial scientific institution whose purpose is scientific research fees shall be limited to only reasonable standard charges for document duplication (excluding charges for the first 100 pages). Requesters must reasonably describe the records sought and must show that the request is being made under the auspices of a qualifying institution and that records are not sought for commercial use, but in furtherance of scientific research.

(d) Representatives of the news media. (1) When the request is made by a representative of the news media, fees shall be limited to only reasonable standard charges for document duplication (excluding charges for the first 100 pages). Requesters must reasonably describe the records sought.

(2) Representatives of the news media must meet the criteria defined in paragraph (h) of §701.41, and the request

must not be made for commercial use. A request for records supporting the news dissemination function of the requester shall not be considered to be a request that is for a commercial use. For example, a request by a newspaper for records relating to an investigation of a defendant in a current criminal trial of public interest could be presumed to be a request from an entity eligible for inclusion in this category, and entitled to records at the cost of duplication alone (excluding charges for the first 100 pages).

(3) "Representative of the news media" does not include private libraries, private repositories of Government records, or middlemen, such as information vendors or data brokers.

(e) All other requesters. Naval activities shall charge requesters who do not fit into any of the above categories fees to recover the full direct cost of search and duplicating records, except the first 2 hours of search time and the first 100 pages of duplication shall be furnished without charge. Requesters must reasonably describe the records sought. Requests from subjects about themselves will continue to be treated under the fee provisions of 5 U.S.C. 552a, which permit fees only for duplication. Naval activities are reminded that this category of requester may be eligible for a waiver or reduction of fees if disclosure of the information is in the public interest.

§ 701.43 Fee restrictions.

(a) A naval activity may not charge fees if the costs of routine collection and processing of the fee are likely to equal or exceed the amount of the fee. Except for requesters seeking documents for a commercial use, naval activities shall provide the first 2 hours of search time and the first 100 pages of duplication without charge. For example, for a request (other than one from a commercial requester) involving 2 hours and 10 minutes of search time and 105 pages of documents, a naval activity would recover the cost of only ten minutes of search time and five pages of duplication. If this processing cost was equal to or less than the cost to the naval activity for billing the requester and processing the fee col

lected (i.e., $15), no charges would result.

(b) Requesters are entitled to the first 2 hours of search and 100 pages of duplication without charge once per request. Consequently, if after completing its portion of a request, a naval activity, refers the request to another naval activity to act on their portion of the request, the referring naval activity shall inform the recipient of the amount of search time and duplication cost to date so the final Navy response will address all fees in the processing of the request. For referrals to other federal agencies or Department of Defense components, if the naval costs of processing the request are chargeable based on fee guidelines, the fees should be collected from the requester and the recipient of the referral advised of the fee status of the request. If the fees are not chargeable based on the fee guidelines, the recipient of the referral should be advised of the naval fees associated with the processing of the request.

(c) In determining the "cost of collecting a fee" consider administrative costs to the naval activity of receiving and recording a remittance, and processing the fee for deposit in the Treasury Department's special account. The Treasury's cost to handle such remittance is negligible and shall not be considered in a naval activity's determination.

(d) To determine cost, "pages" refers to standard size paper copies normally 8 1/2" x 11" or 11" x 14". Thus, requesters would not be entitled to 100 microfiche or 100 computer disks, for example. A microfiche containing the equivalent of 100 pages or 100 pages of computer printouts, meets the restriction.

(e) For computer searches, the first 2 free hours will be determined by the salary scale of the individual doing the computer search. For example, when the direct costs of the computer central processing unit, input-output devices, and memory capacity equal $24 (2 hours of equivalent search at the clerical level), computer costs in excess of that amount are chargeable as computer search time.

§ 701.44 Fee waivers.

(a) When the naval activity determines that waiver or reduction of fees is in the public interest, documents will be furnished without charge or at a reduced charge. It is in the public interest when furnishing the information is likely to contribute significantly to public understanding of the operations or activities of the Department of the Navy, and is not primarily in the commercial interest of the requester.

(b) Fees shall be waived automatically for all requesters when direct costs for a FOIA request total $15 or less.

(c) Decisions to waive or reduce fees that exceed the automatic fee waiver threshold shall be made on a case-bycase basis when:

(1) Disclosure of the information "is in the public interest because it is likely to contribute significantly to public understanding of the operations or activities of the government."

(i) Subject of the request. Naval activities should analyze whether the subject matter of the request involves issues which will significantly contribute to the public understanding of the operations or activities of the Department of the Navy. Requests for records in the possession of the Department of the Navy originated by non-government organizations and sought for their intrinsic content rather than informative value will not likely contribute to public understanding of the operations or activities of the Department of the Navy. Examples of such records are press clippings, magazine articles, or records forwarding a particular opinion or concern from a member of the public regarding a naval activity. Similarly, disclosures of records of considerable age may or may not bear directly on the current activities of the Department of the Navy; however, the age of a particular record shall not be the sole criteria for determining the value of a document. These requests must be closely reviewed while considering the requester's stated purpose for the records and the potential for public understanding of the operations and activities of the Department of the Navy.

(ii) Informative value of the information to be disclosed. Naval activities

should analyze the substantive contents of a record or portion of the record to determine whether disclosure is meaningful and will inform the public on Department of the Navy's operations or activities. While the subject of a request may contain information on operations or activities of the Department of the Navy, it may not have great potential for contributing to a meaningful understanding of these operations or activities. An example would be a heavily redacted record, with only random words, fragmented sentences, or paragraph headings. A determination as to whether that type of record will contribute to the public understanding of the operations or activities of the Department of the Navy must be weighed against the requester's intended use. Another example is disclosure of information already in the public domain or nearly identical information may add no meaningful new information on Department of the Navy operations and activities.

(iii) Contribution to the public's understanding from disclosure. Disclosure contributes to the public's understanding when disclosure will inform or have the potential to inform the public, rather than the individual requester or small segment of interested persons. The requester's identity determines whether the requester has the capability and intention to disseminate the information to the public. Assertions of plans to write a book, research a particular subject, doctoral desertion work, or indigency are insufficient. Requester must demonstrate the capacity to disclose the information in a manner informative to the general public. Requesters should describe their qualifications, nature of their research, purpose of the requested information, and intended means of dissemination to the public.

(iv) The significance of the contribution to public understanding. Naval activities must assess the significance or impact of disclosure against the current level of public knowledge or understanding prior to the disclosure. In other words, will disclosure on a current subject of wide public interest be unique in contributing previous unknown facts, thereby enhancing public knowledge,

or will it basically duplicate what is already known by the general public. Naval activities shall not make value judgments whether the information is important enough to be made public.

(2) Disclosure of the information "is not primarily in the commercial interest of the requester."

(i) Existence and magnitude of a commercial interest. If the request is a commercial interest, naval activities should address the magnitude of that interest to see if the requester's commercial interest is primary, as opposed to any secondary personal or non-commercial interest. In addition to profitmaking organizations, individual persons or other organizations may have a commercial interest in obtaining certain records. Where it is difficult to determine whether this is a commercial requester, naval activities may infer it from the requester's identity and circumstances of the request. The requester's commercial benefit must clearly override any personal or nonprofit interest to apply FOIA commercial standards.

(ii) The primary interest in disclosure. Once a requester's commercial interest has been determined, naval activities should then determine if disclosure would be primarily in that interest. That requires balancing the commercial interest of the request against any public benefit derived as a result of that disclosure. Where the public interest served is beyond that of the requester's commercial interest, a waiver or reduction of fees would be appropriate. Conversely, even if a significant public interest exists and the relative commercial interest of the requester is greater than the public interest, then a waiver or reduction of fees would be inappropriate. For example, while news media organizations have a commercial interest as business organizations, their role of disseminating news to the public can ordinarily be presumed to be of a primary interest. Therefore, any commercial interest is secondary to the primary interest in serving the public. Similarly, scholars writing books or engaged in other forms of academic research may recognize a commercial benefit, either directly or indirectly (through the institution they represent); however, normally

such

pursuits are primarily undertaken for educational purposes, and charging a fee would be inappropriate. Conversely, data brokers or others who compile government information for marketing can normally be presumed to primarily have a commercial interest.

(iii) The above factors and examples are not all inclusive. Each fee decision must be considered on a case-by-case basis the merits of the information provided in each request. When the decision to charge, reduce, or waive the fee cannot be clearly resolved, naval activities should rule in favor of the requester.

(d) The following additional circumstances describe situations where waiver or reduction of fees are most likely warranted:

(1) A record is voluntarily created to preclude an otherwise burdensome effort to provide voluminous amounts of available records, including additional information not requested.

(2) A previous denial of records is reversed in total, or in part, and the assessable costs are not substantial (e.g., $15 - $30).

§ 701.45 Fee assessment.

(a) Fees may not be used to discourage requesters. FOIA fees are limited to standard charges for direct document search, review (in the case of commercial requesters), and duplication.

(b) To be responsive as possible to FOIA requests while minimizing unwarranted costs to the taxpayer, naval activities shall:

(1) Analyze each request to determine the category of the requester. If the naval activity's determination of the category of the requester is different than that claimed by the requester, the naval activity will:

(i) Notify the requester that additional justification should be provided to support the category claimed, and that a search for responsive records will not be initiated until agreement on the category of the requester. Absent further category justification from the requester and a reasonable period of time (i.e., 30 calendar days), the naval activity shall render a final category determination and notify the requester of the determination, including administrative appeal rights.