- 9 urgent. To do this, the Congress should, we respectfully submit, first reject the budget for Customs that has been sent to Congress by OMB. We recommend that instead the Customs Service be allowed access to the monies now building up in the Commercial User Fee Account and that Congress require that Customs increase its staff to the 15,000 level for FY 1987/1988. We further recommend that Congress monitor Customs commercial operations closely over this period and increase enforcement employment as justified and needed to ensure efficient and effective commercial operations. We shall then have a The CHAIRMAN. Mr. Williams. STATEMENT OF JAMES R. WILLIAMS, PRESIDENT, NATIONAL RETAIL MERCHANTS ASSOCIATION, NEW YORK, NY Mr. WILLIAMS. Senator, my name is James R. Williams, and I am the President of the National Retail Merchants Association. We represent some 40,000 general merchandise stores doing around $150 billion in goods and services sales. I am here to tell you that the commercial operations-the Customs commercial operations-has deteriorated in recent years to the point where importing has become a struggle and a risk. First, the relationship between the Customs Service and importers has seriously eroded. Although Customs views its primary mission as one of enforcement, interdicting illegal drugs, and ferreting out customs law violations and fraud, this emphasis has blurred the distinction betwixt the majority of U.S. importers who are legitimate and law-abiding and the few who are unscrupulous. Second, as we have heard, Customs does not have sufficient resources to efficiently process commercial entries. This exacerbates the already existing adversarial relationship between retailers and Customs officials. There are not enough inspectors, as we have heard. Customs is unable to provide importers with binding rulings or other advice prior to entry of merchandise. The administration of Customs regulations is inconsistent from port to port. The Service is inadequately automated, and Customs commodity specialists are frequently inexperienced. The Customs Service no longer provides adequate service to legitimate importers. My written statement, which has been filed, contains many anecdotes collected from NRMA members that graphically illustrate the difficulties we face. Third, the Customs Service routinely communicates new rules and procedures directly to field offices without also informing importers, who are required to comply with the rules. Retailers are justifiably frustrated when they find their shipments denied entry because Customs has changed the rules of the game. NRMA recommends that Congress take the following actions to improve Customs Service operations. One, create a program of reward to those importers who establish their own programs to assure compliance with customs laws. Two, increase the number of inspectors and improve their training of reassigned personnel on a staggered basis. Three, fully automated textile and apparel quota monitoring and make certain it interfaces with other Customs Service computer programs. Four, increase the ability of the Customs Service to provide importers with finding rulings and informal advice and require field officers to abide by these rulings. Five, separate commercial processing and drug enforcement activities, and separate them in order to reaffirm the importance of Customs' commercial activities. And six, establish an importer's advisory committee to provide a sounding board for new Customs Service policies and to foster a better understanding between importers and Customs. Clearly, some of these recommendations will cost money, and we certainly recognize budgetary restraints; but like it or not, retailers and importers are now paying for Customs commercial operations through the 0.22 percent user fee. NMRA opposes this fee and its retention and expansion; but as long as we are paying for commercial processing of entries, we certainly ought to receive better service. Thank you. The CHAIRMAN. Mr. Rose, will you proceed, please? [The prepared written statement of Mr. Williams follows:] National Retail Merchants Association NRM13 100 WEST 31st STREET NEW YORK NY 10001-3401 212 244-8780 STATEMENT OF JAMES R. WILLIAMS, PRESIDENT ON THE OPERATIONS OF THE U.S. CUSTOMS SERVICE This statement represents the views of the National Retail Merchants Association ("NRMA") on the operations of the U.S. Customs Service. The NRMA is a non-profit voluntary trade association whose approximately 3,700 corporate members operate than 40,000 department, chain, and specialty stores throughout the United States. NRMA's members import a wide variety of merchandise, and so have an immediate and strong interest in the fair and efficient processing of their entries by the U.S. Customs Service. NRMA members have experienced first-hand how Customs' commercial importation processing operations have deteriorated in recent years to the point where importing is a struggle and a risk for even large, reputable companies. This unacceptable situation led to the recent establishment of a Special Customs Task Force in NRMA's Foreign Trade Committee to attempt to help NRMA members deal with Customs problems. One of the first things that the Task Force did was to canvass our members for their observations on how Customs is handling commercial importations. The information and case histories presented in this statement have been collected from NRMA's member firms. They illustrate, quite graphically, many of the |