1140-0098 Justification 2017 - 508

Department of Justice
Bureau of Alcohol, Tobacco, Firearms and Explosives
Supporting Statement - Information Collection Request
OMB # 1140-0098
Prevent All Cigarette Trafficking (PACT) Act Registration Form, ATF F 5070.1

A. Justification:
1.

In addition to enforcing federal laws relating to the manufacture and commerce of
firearms and explosives, the Bureau of Alcohol, Tobacco, Firearms and Explosives
(ATF) assist the states in their effort to eliminate interstate trafficking in, and the
sale and distribution or cigarettes and smokeless tobacco in avoidance of federal and
state taxes. On March 31, 2010, President Obama signed into law the Prevent All
Cigarette Trafficking Act of 2009 (PL 111-154). The law requires any person who
sells, transfers, or ships for profit cigarettes and/or smokeless tobacco in interstate
commerce must register with the Attorney General of the United States (delegated to
ATF) and the state tax administrators of the state in which the shipment is made or in
which state such advertisement or offer is disseminated.

2.

Recognizing that the range in state cigarette and smokeless tobacco taxes creates a
potential for interstate trafficking of these products to avoid state tax, Congress has
enacted federal laws to help ensure the state cigarette and smokeless tobacco taxes
are paid. The law requires any person that sells, transfers, or ships for profit
cigarettes and/or smokeless tobacco in interstate commerce to register with ATF.
Respondents will register the information on ATF F 5070.1, Prevent All Cigarette
Trafficking (PACT) Act Registration Form. The purpose of the form is to register
delivery sellers of cigarettes and/or smokeless tobacco products with the Attorney
General in order to legally continue to sell and/or advertise these tobacco products.
The information will assist ATF in creating a list of Delivery Sellers that have not
registered with ATF and make that list available to the attorney general and tax
administrator of each state, common carriers and any other person that the Attorney
General of the United States deems appropriate to receive the list.

3.

The fillable form is available on the ATF website. It can be downloaded and mailed
to ATF. If adequate funding is obtained, ATF plans to create a database that will
allow any person to register electronically and also have the option of printing the
form for their records.

4.

ATF uses a uniform subject classification system to identify duplication and to
ensure that any similar information already available cannot be used or modified for
use for the purpose of this information collection.

5.

ATF has conducted an assessment on the impact on small businesses and other small
entities under the Regulatory Flexibility Act (5 U.S. C. 601 et seq.) and has
concluded that there will not be a significant impact on small businesses and other
small entities.

6.

The consequences if this collection of information is not adhered to would be that
any person required to register with ATF, would be in violation of the PACT Act and
would subsequently be placed on the list of non-compliant Delivery Sellers.
Placement on this list would severely limit the Delivery Sellers legal ability to
continue to operate their business.

7.

The collection of information is consistent with the provisions of 5 CFR 1320.6.

8.

No public comments were received for either the 60-day or 30-day notices that were
published in the Federal Register.

9.

No payment or gift is associated with this collection.

10. The assurance of confidentiality is contained in the Privacy Act. Confidentiality is
not assured.
11. No questions of sensitive nature are asked.
ATF estimates that about 400 respondents are impacted by this registration
requirement. To estimate the number of affected businesses, we have totaled the
number of PACT registrants ATF currently receives, the total number of noncompliance letter the ATEB sends to business, and increased the estimate to reflect
that ATF does not capture all businesses with its non-complaint letters. Since 2010,
ATF has received between 14 and 200 Pact Act Registration forms annually. We
anticipate this number will increase in the coming years as ATF focuses on
improving enforcement measures. In 2016, ATEB forwarded approximately 112
Non-Compliant violation letters to delivery sellers advertising the sale or selling
cigarettes on the internet without being registered with ATF or the state in which
they are doing business.

ATF estimates that it will take the respondents approximately one hour to complete
ATF F 5070.1 and send that form to ATF. Each person required to register with
ATF will conduct this registration requirement one time. The total number of
responses is 400. The total annual burden hours associated with this collection is
400 hours.
12. ATF estimates the cost to businesses impacted will be $9,396 collectively. ATF has
derived this figure by assuming that each business impacted will have to file an ATF
F 5070.1, the cost of a stamp and envelope is estimated at $.50, the labor to complete
the form has been estimated at one hour and the labor cost is estimated at $22.99 per
hour for service-providing civilian workers.
13. The table below illustrates the estimated costs:
Labor Costs: $22.99 1 x 400 businesses
$ 9,196
Mailing Costs: $.50 x 400 businesses
$ 200
Total Costs:
$ 9,396
14. Estimates of annual costs to the Federal government are:
Printing
$ 1,000.00
Distribution
$ 18,000.00
Salary
$136,000.00
Overhead
$ 1,000.00
Total
$156,000.00
15.

This revision is due to ATF’s most recent figures regarding the number of affected
businesses annually, which have resulted in a decrease of respondents from 3,000
to 400, and a reduction in burden hours from 3,000 to 400. The wage rate is also
updated to the September 2016 BLS wage rate, and also reflects a reduction in the
burden costs for this collection from $42,000 to $9,396.

16.

The results of this collection will not be published.

17.

ATF does not request approval to not display the expiration date of OMB approval
for this collection.

18.

There are no exceptions to the certification statement.

1 Cost estimates are based on employee compensation data for September 2016, as determined by the U.S.
Department of Labor, Bureau of Labor Statistics and announced in its news release dated December 8, 2016, which
is available at https://www.bls.gov/news.release/pdf/ecec.pdf. The Bureau of Labor Statistics determined a wage
cost of $22.99 per hour for service-providing civilian workers.
.

B. Collection of Information Employing Statistical Methods
Not applicable.