[Federal Register Volume 88, Number 41 (Thursday, March 2, 2023)]
[Notices]
[Pages 13141-13145]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-04295]
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DEPARTMENT OF HOMELAND SECURITY
[CIS No. 2725-22; DHS Docket No. USCIS-2023-0001]
RIN 1615-ZB97
Notice of EB-5 Regional Center Integrity Fund Fee
AGENCY: U.S. Citizenship and Immigration Services, Department of
Homeland Security.
ACTION: Notice of integrity fund fee.
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SUMMARY: The U.S. Citizenship and Immigration Services (USCIS) is
announcing a fee to be collected by USCIS. The EB-5 Reform and
Integrity Act of 2022 (the 2022 Act) requires USCIS to establish a
special fund to be known as the EB-5 Integrity Fund to be primarily
used by USCIS in the administration of the Regional Center Program.
USCIS must collect a fee of $20,000 or $10,000, depending on certain
factors established by the 2022 Act, to finance the EB-5 Integrity Fund
from each designated regional center. This notice explains how regional
centers should determine the amount of the fee and provides the process
for how it is to be paid.
DATES: The first fee payment of the fees announced in this notice must
be paid beginning on March 2, 2023 and before April 3, 2023. For fiscal
year 2024 and each year thereafter, the fees must be paid between
October 1st and October 31st of the same year.
FOR FURTHER INFORMATION CONTACT: Charles L. Nimick, Chief, Business and
Foreign Workers Division, Office of Policy and Strategy, U.S.
Citizenship and Immigration Services, Department of Homeland Security,
5900 Capital Gateway Drive, Camp Springs, MD 20588-0009, telephone
(240) 721-3000 (this is not a toll-free number). Individuals with
hearing or speech impairments may access the telephone number above via
TTY by calling the toll-free Federal Information Relay Service at 1-
877-889-5627 (TTY/TDD).
SUPPLEMENTARY INFORMATION:
Table of Abbreviations
DHS--Department of Homeland Security
INA--Immigration and Nationality Act
USCIS--U.S. Citizenship and Immigration Services
I. Background and Authority
A. EB-5 Reform and Integrity Act of 2022
On March 15, 2022, the President signed into law the EB-5 Reform
and Integrity Act of 2022 (the 2022 Act), Div. BB of the Consolidated
Appropriations Act, 2022, Public Law 117-103. Among other things, the
2022 Act immediately repealed the former authorizing statutory
provisions under the Departments of Commerce, Justice, and State, the
Judiciary, and Related Agencies Appropriations Act 1993, Public Law
102-395, 106 Stat. 1828, Sec. 610, and added new authorizing
provisions to the Immigration and Nationality Act, substantially
reforming the Regional Center Program effective May 14, 2022. The
reformed Regional Center Program is authorized through September 30,
2027.
The Regional Center Program makes visas available to qualified
immigrants (and the eligible spouses and children of such immigrants)
who pool their investments with other qualified immigrants in a
``regional center'' in the United States. See INA section 203(b)(5)(E),
8 U.S.C. 1153(b)(5)(E). USCIS designates regional centers based on a
proposal for the promotion of economic growth, including prospective
job creation and increased domestic capital investment in their
requested geographic region. Id.
B. EB-5 Integrity Fund
The 2022 Act establishes a special fund to be known as the EB-5
Integrity Fund (the Fund). INA section 203(b)(5)(J), 8 U.S.C.
1153(b)(5)(J). The fund is to be used by DHS for the following:
(1) Conducting investigations based outside of the United States,
including monitoring and investigating program-related events and
promotional activities and ensuring that an alien investor's funds
associated with the alien's investment were obtained from a lawful
source and through lawful means;
(2) Detecting and investigating fraud or other crimes;
(3) Determining whether regional centers, new commercial
enterprises, job-creating entities, and alien investors
[[Page 13142]]
(and their alien spouses and alien children) comply with U.S.
immigration laws;
(4) Conducting audits and site visits; and
(5) For other purposes as the Department of Homeland Security (DHS)
determines necessary.
INA section 203(b)(5)(J)(iii), 8 U.S.C. 1153(b)(5)(J)(iii).
II. Integrity Fund Fee
A. Annual Fee.
The 2022 Act requires the Fund to be financed through the
collection of an annual fee paid by and collected from designated
regional centers (Integrity Fund Fee).\1\ INA section 203(b)(5)(J)(ii),
8 U.S.C. 1153(b)(5)(J)(ii). USCIS recognizes that the 2022 Act required
it to collect the first fee by October 1, 2022 and impose penalties for
fees not paid by October 31, 2022. USCIS is working to implement the
statutory mandates as soon as practicable. While that work is ongoing,
and in an effort to implement the plain terms of the 2022 Act as
quickly as possible, USCIS will begin collecting the fee for fiscal
year 2023, which under the 2022 Act would have been due on October 1,
2022, on March 2, 2023. USCIS will accept payment of the fee, as
required by the statute, for 30 days. For fiscal year 2024 and each
year thereafter, such fees are required to be paid between October 1st
and October 31st of the same year. Id.
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\1\ Beginning on October 1, 2022 and in accordance with Form I-
526E, Immigrant Petition by Regional Center Investor, filing
instructions on the USCIS website, USCIS began collecting a $1,000
Integrity Fund Fee with each new immigrant investor petition filed
by a regional center investor for the Fund. INA section
203(b)(5)(J)(ii)(II), 8 U.S.C. 1153(b)(5)(J)(ii)(II).
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Section 102 of the Homeland Security Act of 2002 and section 103 of
the INA, 8 U.S.C. 1103, generally charge DHS with the administration
and enforcement of the immigration and naturalization laws of the
United States.\2\ The INA further authorizes DHS to ``establish such
regulations; prescribe such forms of bond, reports, entries, and other
papers; issue such instructions; and perform such other acts as he
deems necessary for carrying out his authority under the provisions
of'' the INA.\3\ In the Homeland Security Act of 2002, Congress also
provided that DHS ``shall be responsible for . . . [e]stablishing
national immigration enforcement policies and priorities.'' \4\ The
Homeland Security Act also provides that DHS, in carrying out its
authorities, must ``ensure that the overall economic security of the
United States is not diminished by efforts, activities, and programs
aimed at securing the homeland.'' \5\
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\2\ Public Law 107-296, sec. 102(a)(3), 116 Stat. 2135, 2143
(codified at 6 U.S.C. 112(a)(3)); Public Law 82-414, 66 Stat. 163
(as amended); INA sec. 103(a)(1), 8 U.S.C. 1103(a)(1).
\3\ INA sec. 103(a)(3), 8 U.S.C. 1103(a)(3).
\4\ Public Law 107-296, sec. 402(5), 116 Stat. 2135, 2178
(codified at 6 U.S.C. 202(5)).
\5\ 6 U.S.C. 111(b)(1)(F).
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DHS is directed to set national immigration enforcement policies
and priorities, and as such, is ultimately accountable for
appropriately using the resources available to the Department as a
whole and for taking a comprehensive view of the enforcement landscape.
The 2022 Act sets the standard annual fee at $20,000 for each
designated regional center. However, for those with ``20 or fewer total
investors in its new commercial enterprises'' during the preceding
fiscal year (October 1-September 30), the annual fee is reduced to
$10,000. Id.
At this time, given the statutory mandate to collect the fees
beginning on October 1, 2022, and limited agency resources, USCIS is
utilizing its discretion to set an enforcement policy for how it will
evaluate whether a regional center has appropriately counted the number
of its total investors and thus paid the correct fee. As a general
matter, USCIS adjudicators will evaluate on a case-by-case basis how
many investors a regional center has in any given fiscal year. However,
adjudicators will engage in that case-by-case analysis with the
understanding that, generally speaking, the number of investors for
purpose of calculating the fee to be paid will be the total number of
EB-5 investors who have invested (or are actively in the process of
investing) in all of the regional center's new commercial enterprises
in the respective fiscal year. This policy is drawn as closely to the
plain statutory language as possible and is in line with the general
understanding of the term ``investors'' by EB-5 stakeholders.
Although ``investor'' is not specifically defined for purposes of
INA section 203(b)(5), 8 U.S.C. 1153(b)(5), it is used extensively
throughout that section to refer to noncitizens seeking classification,
or classified, under INA section 203(b)(5) 8 U.S.C. 1153(b)(5) (i.e. I-
526 and I-526E petitioners). For purposes of INA section 216A, ``alien
investor'' is defined as ``an alien who obtains the status of an alien
lawfully admitted for permanent residence (whether on a conditional
basis or otherwise)'' under INA section 203(b)(5), 8 U.S.C. 1153(b)(5).
See INA 216A(f)(1), 8 U.S.C. 1186b(f)(1).
USCIS recognizes that there is no legal requirement that an
investor remain invested in an NCE within a specific time period after
they file their Form I-829, Petition by Investor to Remove Conditions
on Permanent Resident Status, and thus has determined that the filing
of the Form I-829 generally would be an appropriate demarcation for
purposes of determining the number of ``total investors in the
preceding fiscal year.'' Based on INA sections 203(b)(5) and
216A(f)(1), USCIS generally considers an individual to be an investor
from the point of filing a petition for classification (Form I-526,
Immigrant Petition by Alien Entrepreneur, or Forms I-526E, Immigrant
Petition by Regional Center Investor) through the point of filing a
petition for removal of conditions (Form I-829, Petition by Investor to
Remove Conditions on Permanent Resident Status). This is also the
general understanding of the term amongst EB-5 stakeholders.\6\ Thus,
subject to additional considerations described below, USCIS intends to
estimate the approximate number of total investors in a regional center
in any given fiscal year by subtracting the number of Forms I-829
associated with the regional center filed at any time on or before
September 30 of that fiscal year (including filings from prior fiscal
years) from the total number of pending and approved Forms I-526,
Immigrant Petition by Standalone Investor, associated with the regional
center (filed on or before June 30, 2021) and Forms I-526E, Immigrant
Petition by Regional Center Investor, (filed on or after June 1, 2022
(the date USCIS published the form)) associated with the regional
center filed at any time on or before September 30 of that same fiscal
year (including filings from prior fiscal years). A Form I-829 that is
filed separately by a spouse or child of an investor that obtained
conditional permanent resident status based on their relationship to
the investor and was not included on the principal investor's Form I-
829 may typically be excluded from the total investor calculation. For
example, if a regional center had 30 associated Form I-526 petitions,
10 associated Form I-526E petitions and 20 associated Form I-829
petitions filed on or before September 30, 2022, USCIS generally would
estimate that the
[[Page 13143]]
regional center has 20 total investors in its new commercial
enterprises for fiscal year 2022 (FY22) for purposes of calculating the
applicable Integrity Fund fee for fiscal year 2023 (FY23) and would
likely owe the reduced fee amount of $10,000, subject to additional
considerations described below.
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\6\ See, e.g., EB-5 Diligence, Answers to Common EB-5 Visa
Investor Questions (Apr. 26, 2021), available at https://www.eb5diligence.com/articles/common-eb-5-investor-questions
(explaining that an investor's capital goes into an NCE, the ``at
risk''' requirement lasts the ``duration of the immigrant investor's
conditional residency'', and if USCIS denies the petition for
ineligibility, ``all the NCE's investors . . . would then have to
start the investment process all over with a new I-526 filing and
EB-5 investment.'').
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USCIS recognizes that there may be alternative methods of
calculating ``total investors'' and has considered potential reliance
interests in arriving at this interpretation. As this is an entirely
new statutorily created and mandated fee, and USCIS thus has not
previously enforced this requirement, USCIS believes that regional
centers likely do not have appreciable reliance interests that favor a
given interpretation. USCIS emphasizes that the method of approximating
investors described above is meant to be a general guide to USCIS
adjudicators in this calculation. USCIS adjudicators retain discretion
to evaluate the Integrity Fund fee due and the number of investors on a
case-by-case basis, accounting for any other facts or evidence in the
record in the totality of the circumstances, including any evidence
provided by a regional center that believes it has greater or fewer
total investors.
USCIS considered alternative methods of calculating when a
noncitizen generally would no longer be deemed an ``investor'';
however, those options generally would either not capture the entire
population or involve manual calculations that USCIS believes would
place an unreasonable burden on the Agency's limited resources as USCIS
works to implement the 2022 Act. Additionally, those options might be
confusing and burdensome to the investor or regional center
populations. For example, USCIS considered generally counting only the
Forms I-526 that were filed within two years of the applicable period
used for determining the EB-5 Integrity Fund fee given the expected
two-year minimum timeframe for the investment, or sustainment period,
under the 2022 Act. INA section 203(b)(5)(A)(i); 8 U.S.C.
1153(b)(5)(A)(i). However, that would likely be underinclusive given
that many investors are actively in the process of investing (i.e. not
yet fully invested) when they file their Form I-526 petition as
permitted under applicable requirements and, additionally, would not
align with the sustainment period for those who filed prior to the 2022
Act, which runs approximately to the point of the Form I-829 filing,
regardless of when they filed their Form I-526 or made their
investment. For Form I-526 petitions filed after the 2022 Act, USCIS
also considered generally counting only Form I-526 petitions whose
investments were still within the two-year period of investment
expected under INA 203(b)(5)(A)(i); however, manual verification of the
time period of investment for each regional center investor, rather
than conducting a systems inquiry for total petition filings, would
exhaust valuable and significant USCIS resources that the agency
believes, in the balance, are better utilized in service of other
adjudicatory priorities. USCIS acknowledges the practical limitations
of determining how many ``total investors'' may be in a new commercial
enterprise during any given fiscal year to ensure that the correct fee
is paid. We believe the general method we are announcing in this
notice, subject to case-by-case analysis, reflects both a reasonable
interpretation of the statute and ensures that USCIS' limited resources
are used most efficiently to ensure compliance with the 2022 Act.
B. Fee Payment Process
Before April 3, 2023, and between October 1 and October 31 of each
following year (FY 2024 onward), each designated regional center must
pay the fee to USCIS online via the online form hosted on Pay.gov at
Pay.gov--EB5--Annual Fee for Regional Center. Payment of this fee must
be made by an authorized individual on behalf of a regional center.
Each designated regional center must pay the fee with either a valid
credit or debit card or by authorizing an ACH Debit transaction where
the regional center provides its U.S. bank routing and checking account
numbers to have money debited directly from its U.S. bank account.
Please note that the U.S. Department of Treasury guidelines permit
USCIS to accept a maximum payment amount of $24,999 from one credit
card in one day, and a single obligation cannot be split into multiple
credit card payments over multiple days in order to evade this
limit.\7\
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\7\ See U.S. Department of the Treasury, Bureau of the Fiscal
Service, Treasury Financial Manual, Chapter 7000, section 7055.20,
available at https://tfm.fiscal.treasury.gov/v1/p5/
c700#:~:text=Federal%20entities%20must%20limit%20their,are%20no%20mor
e%20than%20%2410%2C000.00 (last viewed Oct. 12, 2022).
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The 2022 Act and this notice represent the constructive notice to
designated regional centers of the amount they owe and when it is due.
USCIS will also post information on its website and issue a press
release but will not send an invoice to the regional centers beyond
this notice. Each regional center is responsible for determining their
amount owed based on the number of total investors and for submitting
the appropriate fee before the due date. If a regional center is
required to provide evidence of payment of this fee, USCIS will accept
proof that the fee is paid in the form of, for example, a copy of the
Pay.gov payment confirmation email or a notice or statement from the
payer's credit card issuer or financial institution.
C. Late Fee
The 2022 Act requires DHS to impose a reasonable penalty fee (to be
paid to USCIS and deposited into the Fund when collected) on a regional
center that does not pay the annual Integrity Fund fee within 30 days
after the date on which such fee is due. INA section 203(b)(5)(J)(iv),
8 U.S.C. 1153(b)(5)(J)(iv). USCIS must terminate the designation of any
regional center that does not pay the fee within 90 days after the date
on which such fee is due. Id.
DHS has decided, in exercising its discretionary enforcement
authority articulated above, that USCIS will not charge the late
penalty in 2022 for the following reasons: (1) the Fund and Integrity
Fund fee are new program requirements; and (2) USCIS must determine an
amount that is a ``reasonable'' penalty to charge. Therefore, DHS has
decided and USCIS is announcing that, as a matter of discretionary
enforcement policy, we will not charge a late fee until we take further
action to set the amount of the late fee, as well as the process for
collecting the late fee.
However, USCIS will, as authorized by the 2022 Act, terminate the
designation of any regional center that does not pay the full fee
within 90 days after the date on which such fee is due (i.e., a
regional center does not make payment, or a regional center pays
$10,000 when it owes $20,000). Termination will not be automatic and
USCIS will provide a notice of intent to terminate and the opportunity
for a regional center to prove that the fee was paid in the proper
amount by the due date before sending a notice of termination. Again,
USCIS recognizes that the 2022 Act requires collection of the fee on
October 1, 2022 and imposition of termination after 90-days. Because
this notice published after October 1, 2022, USCIS will maintain the
statutory 90-day termination period and will not begin taking steps to
terminate a regional center until May 31, 2023. For all subsequent
years, USCIS will take steps to terminate the regional center if the
regional center
[[Page 13144]]
does not pay the full fee by December 31st.\8\
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\8\ The 2022 Act provides that DHS may increase the annual
Integrity Fund fee as necessary to ensure that the Fund is
sufficient to carry out its purposes. INA section
203(b)(5)(J)(ii)(III), 8 U.S.C. 1153(b)(5)(J)(ii)(III). DHS may
increase the amount of the Integrity Fund fees through future
regulations if the collections are inadequate.
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III. Regulatory Requirements.
A. Administrative Procedure Act
DHS and USCIS are taking this action without prior notice and
opportunity for comment because this document is a general statement of
policy supported by its discretionary enforcement authority and an
interpretive rule. 5 U.S.C. 553(b)(A) (notice and comment requirements
do not apply to ``general statements of policy'' and ``interpretive
rules'').
The Homeland Security Act authorized the Secretary with
``[e]stablishing national immigration enforcement policies and
priorities.'' \9\ In accordance with these authorities, and in
attempting to quickly effectuate as much of the 2022 Act's statutory
requirements as possible, DHS is exercising its discretionary authority
to explain how it will evaluate whether a regional center has paid the
correct fee, and will not impose a reasonable penalty fee on a regional
center that does not pay the annual Integrity Fund fee within 30 days
until it can pursue additional rulemaking. The Supreme Court explained
in Heckler v. Chaney, 470 U.S. 821, 831-32 (1985), that ``an agency
decision not to enforce often involves a complicated balancing of a
number of factors which are peculiarly within its expertise . . . we
note that when an agency refuses to act it generally does not exercise
its coercive power over an individual's liberty or property rights.''
DHS has balanced the impact to the public of imposing a ``reasonable
penalty,'' the timeliness of complying with the statutory mandates, and
the agency delays in providing notice to regional centers regarding how
to submit the fee. Ultimately, DHS decided that the discretionary
policy of non-enforcement presented in this Notice was the most
equitable path forward.
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\9\ Public Law 107-296, sec. 402(5), 116 Stat. 2135, 2178
(codified at 6 U.S.C. 202(5)).
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Alternatively, this agency action is an interpretive rule. Whether
a rule is legislative or interpretive turns on ``the prior existence or
non-existence of legal duties and rights.'' Am. Mining Congr. v. Mine
Safety & Health Admin., 995 F.2d 1106, 1110 (D.C. Cir. 1993). See,
e.g., United Tech. Corp. v. EPA, 821 F.2d 714, 719-20 (D.C. Cir. 1987)
(``[W]hat distinguishes interpretative from legislative rules is the
legal base upon which the rule rests. If the rule is based on specific
statutory provisions, and its validity stands or falls on the
correctness of the agency's interpretation of those provisions, it is
an interpretative rule. If, however, the rule is based on an agency's
power to exercise its judgment as to how best to implement a general
statutory mandate, the rule is likely a legislative one.''). By law,
USCIS is required to collect the Integrity Fund Fee on an annual basis.
See INA section 203(b)(5)(J)(ii), 8 U.S.C. 1153(b)(5)(J)(ii). The
statutory provision that requires the $20,000 and $10,000 fees contains
little ambiguity for USCIS to resolve or explain:
(I) ANNUAL FEE.--On October 1, 2022, and each October 1 thereafter,
the Secretary of Homeland Security shall collect for the Fund an annual
fee--
(aa) except as provided in item (bb), of $20,000 from each regional
center designated under subparagraph (E); and
(bb) of $10,000 from each such regional center with 20 or fewer
total investors in the preceding fiscal year in its new commercial
enterprises.
INA section 203(b)(5)(J)(ii)(I), 8 U.S.C. 1153(b)(5)(J)(ii)(I). To
the extent that there is minimal ambiguity regarding the calculation of
``total investors'' because the statute does not explicitly include a
calculation, USCIS's interpretation is only intended to guide
adjudicators in the performance of their duties and not remove their
discretion in making adjudicatory decisions. This interpretation does
not create any substantive or procedural right or benefit that is
legally enforceable, because the fees are explicitly provided for in
statute; but rather provides notice to the public regarding this
explicit statutory fee requirement. USCIS imposes no additional duties
or rights, beyond what the 2022 Act has already imposed.
Therefore, USCIS is imposing this fee without soliciting public
comment prior because this is a general statement of policy and an
interpretive rule exempt from notice and comment procedures. 5 U.S.C.
553(b)(A).
B. Other Regulatory Requirements
Because this action is not subject to the notice-and-comment
requirements under the Administrative Procedure Act, a final regulatory
flexibility analysis is not required. See 5 U.S.C. 604(a). In addition,
this notice is not a ``major rule'' as defined by the Congressional
Review Act, 5 U.S.C. 804(2), and thus is not subject to a 60-day delay
in the rule becoming effective. This action is not subject to the
written statement requirements of the Unfunded Mandates Reform Act of
1995 (UMRA) (Pub. L. 104-4). Nor does it require prior consultation
with State, local, and tribal government officials as specified by
Executive Orders 13132 or 13175. This notice also does not require an
Environmental Assessment (EA) or Environmental Impact Statement (EIS).
See 40 CFR 1507.3(b)(2)(ii) and 1508.4. This action does not affect the
quality of the human environment and fits within Categorical Exclusion
number A3(d) in Dir. 023-01 Rev. 01, Appendix A, Table 1, for rules
that interpret or amend an existing regulation without changing its
environmental effect.
This notice does not require review by the Office of Management and
Budget (OMB) under Executive Order 12866. As previously discussed,
USCIS is required to collect the Integrity Fund Fee. Nonetheless, for
illustrative purposes Table 1 shows the total number and aggregate
amount of Integrity Fund Fees that USCIS estimates it will receive in
2022.
Table 1--2022 Projected Integrity Fund Fees
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Size of RC Number Fee in $ Total in $
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>20 investors................................................... 246 $20,000 $4,920,000
<= 20 investors................................................. 384 10,000 3,840,000
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Total....................................................... 630 .............. 8,760,000
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[[Page 13145]]
Finally, this notice and the Integrity Fund Fees are not subject to
the Paperwork Reduction Act, 44 U.S.C. 3501-3521 (PRA). The PRA does
not preclude the imposition of a penalty on an entity for failing to
comply with a collection of information that is imposed on the entity
by statute as is the case with the Integrity Fund Fees. See 5 CFR
1320.6(e).
Ur M. Jaddou,
Director.
[FR Doc. 2023-04295 Filed 3-1-23; 8:45 am]
BILLING CODE 9111-97-P