Federal Register Vol. 80, No.139,

Emerald ash borer (EAB), Agrilus planipennis, is an invasive wood-boring beetle from Asia threatening the ash trees (Fraxinus spp.) of the United States. EAB larvae feed on ash phloem, cutting off the movement of resources within the tree and killing the tree within 4 to 5 years. EAB is able to attack and kill healthy trees in both natural and urban environments and is well suited for climate conditions in the continental United States.

The regulations in “Subpart Emerald Ash Borer” (7 CFR 301.53-1 through 301.53-9, referred to below as the regulations) restrict the interstate movement of certain regulated articles from quarantined areas in order to prevent the spread of EAB into noninfested areas of the United States.

The regulations in § 301.53-3 provide that the Administrator of the Animal and Plant Health Inspection Service (APHIS) will list as a quarantined area each State, or each portion of a State, in which EAB is present, or that the Administrator considers necessary to regulate because of its inseparability for quarantine enforcement purposes from localities in which EAB has been found. The regulations further provide that less than an entire State will be designated as a quarantined area only if the Administrator determines that:

• The State has adopted and is enforcing a quarantined area and regulations that impose restrictions on the intrastate movement of regulated articles that are equivalent to those imposed by the regulations on the interstate movement of those articles; and

• The designation of less than the entire State as a quarantined area will otherwise be adequate to prevent the artificial interstate spread of EAB.

Based on these criteria, APHIS issues Federal Orders to immediately restrict the interstate movement of regulated articles for EAB from areas designated as quarantined areas. After a Federal Order is issued, APHIS publishes a document in the Federal Register to update the regulations to reflect the changes made by the Federal Order. The last update to the regulations was published in May 2010. Since then, APHIS has issued several Federal Orders for EAB that designate areas in the States of Arkansas, Colorado, Georgia, Kansas, Maryland, Minnesota, New Hampshire, North Carolina, Tennessee, Wisconsin, and the District of Columbia to the list of quarantined areas and the States of Connecticut, Iowa, Kentucky, Massachusetts, Missouri, New York, Pennsylvania, and Virginia in their entirety as quarantined areas.1 As a result, our regulations have become outdated.

Therefore, in accordance with the criteria described above, we are amending § 301.53-3 by adding areas in the States of Arkansas, Colorado, Georgia, Kansas, Maryland, Minnesota, New Hampshire, North Carolina, Tennessee, Wisconsin, and the District of Columbia and the States of Connecticut, Iowa, Kentucky, Massachusetts, Missouri, New York, Pennsylvania, and Virginia in their entirety to the list of quarantined areas for EAB. As a result of this rule, the interstate movement of regulated articles from these areas will be restricted. A full list of the areas we are adding to the regulations is provided in the regulatory text at the end of this document.

The rulemaking is necessary on an emergency basis to prevent the spread of EAB to noninfested areas of the United States. Under these circumstances, the Administrator has determined that prior notice and opportunity for public comment are contrary to the public interest and that there is good cause under 5 U.S.C. 553 for making this rule effective less than 30 days after publication in the Federal Register.

We will consider comments we receive during the comment period for this interim rule (see DATES above). After the comment period closes, we will publish another document in the Federal Register. The document will include a discussion of any comments we receive and any amendments we are making to the rule.

This interim rule is subject to Executive Order 12866. However, for this action, the Office of Management and Budget has waived its review under Executive Order 12866.

In accordance with 5 U.S.C. 603, we have performed an initial regulatory flexibility analysis, which is summarized below, regarding the economic effects of this rule on small entities. The full analysis may be viewed on the Regulations.gov Web site (see ADDRESSES above for instructions for accessing Regulations.gov) or obtained from the person listed under FOR FURTHER INFORMATION CONTACT.

The States added, either partially or entirely, to the list of EAB regulated areas include about 51 percent of U.S. sawmills, 46 percent of wood container and pallet manufacturing establishments, 53 percent of landscaping services, 36 percent of nursery and garden centers, 34 percent of recreational vehicles parks and campgrounds, 37 percent of logging operations, and 36 percent of forest nurseries.

Based on our review of available information, APHIS does not expect the interim rule to have a significant economic impact on small entities. Affected industries in the quarantined areas we are adding to the regulations are already operating under EAB quarantine restrictions imposed by Federal Orders. In the absence of significant economic impacts, we have not identified alternatives that would minimize such impacts.

This program/activity is listed in the Catalog of Federal Domestic Assistance under No. 10.025 and is subject to Executive Order 12372, which requires intergovernmental consultation with State and local officials. (See 7 CFR part 3015, subpart V.)

This rule has been reviewed under Executive Order 12988, Civil Justice Reform. This rule: (1) Preempts all State and local laws and regulations that are inconsistent with this rule; (2) has no retroactive effect; and (3) does not require administrative proceedings before parties may file suit in court challenging this rule.

This interim rule contains no information collection or recordkeeping requirements under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.).

Accordingly, we are amending 7 CFR part 301 as follows:

In an interim rule 1 effective and published in the Federal Register on December 29, 2014 (79 FR 77839-77841, Docket No. APHIS-2013-0079), we amended the khapra beetle regulations in 7 CFR part 319 by adding rice (Oryza sativa), chick peas (Cicer spp.), safflower seeds (Carthamus tinctorius), and soybeans (Glycine max) to the list of regulated articles in § 319.75-2 and prohibiting their entry into the United States unless accompanied by a phytosanitary certificate with an additional declaration stating that the articles in the consignment were inspected and found free of khapra beetle in accordance with § 319.75-9. We also added bulk, unpackaged seeds to the list of regulated articles due to their potential for infestation by khapra beetle. In addition, we updated the list of regulated countries in § 319.75-2(b) and moved that list to the Plant Protection and Quarantine (PPQ) Web site at http://www.aphis.usda.gov/import_export/plants/manuals/ports/downloads/kb.pdf. Countries will be added to the list of regulated areas when we receive official notification from the country that it is infested or when we intercept the pest in a commercial shipment from that country. Any future additions to the list of regulated areas will be conveyed through publication of a notice in the Federal Register.

Finally, we updated the regulations for certain commodities due to changes in industry practices that have affected the risk of khapra beetle being introduced into the United States. These actions were necessary to prevent the introduction of khapra beetle from infested countries on commodities that have been determined to be hosts for the pest, reflect current industry practices, and make it easier to make timely changes to the list of regulated countries.

We solicited comments concerning the interim rule for 60 days ending February 27, 2015. We received one comment by that date from a private citizen. The commenter discussed the rule in general terms without supporting or opposing any of its provisions.

Currently, the regulations state that plant gums and seeds shipped as bulk cargo in an unpackaged state are regulated articles. We are making a minor change to clarify that the seeds in this case are plant gum seeds and not all plant seeds. In addition, we are making corrections to the names of several taxa that were misspelled in § 319.75-2, footnote 2.

In the preamble of the interim rule, we stated that we were codifying the requirements of two Federal Orders that, among other things, prohibited the entry into the United States of rice, chick peas, safflower seeds, and soybeans in passenger baggage and personal effects. However, we inadvertently omitted that requirement from the regulations in § 319.75-2. We are correcting that omission in this final rule.

Therefore, for the reasons given in the interim rule and in this document, we are adopting the interim rule as a final rule, with the changes discussed in this document.

This final rule also affirms the information contained in the interim rule concerning Executive Order 12988 and the Paperwork Reduction Act.

Further, for this action, the Office of Management and Budget has waived its review under Executive Order 12866.

This final rule follows an interim rule that amended the khapra beetle regulations by adding additional regulated articles and regulated countries, updating the regulations to reflect changes in industry practices and country names that have changed since the regulations were originally published, and removing the list of countries where khapra beetle is known to occur from the regulations and moving it to the Plant Protection and Quarantine Web site.

The U.S. entities that may be impacted by the rule are likely to be those involved in importing, handling, moving, processing, or selling regulated articles. The 2012 County Business Patterns (North American Industry Classification System) statistics corresponding to the Small Business Administration small-entity standards indicate that between 93 and 100 percent of these entities can be considered small. However, impacts of the rule are expected to be limited; the khapra beetle restrictions on rice imports have been in place since July 2012 and on the latter three crops since December 2011. In addition, none of the newly regulated areas (Kuwait, Oman, Qatar, the United Arab Emirates, and South Sudan, and the Palestinian Authority—West Bank) is an important source for the United States of major commodities known to host khapra beetle.

Under these circumstances, the Administrator of the Animal and Plant Health Inspection Service has determined that this action will not have a significant economic impact on a substantial number of small entities.

Accordingly, the interim rule amending 7 CFR part 319 that was published at 79 FR 77839-77841 on December 29, 2014, is adopted as a final rule with the following changes:

Discussion

We issued a notice of proposed rulemaking (NPRM) to amend 14 CFR part 39 by adding an AD that would apply to all PW JT8D-217C and JT8D-219 turbofan engines. The NPRM published in the Federal Register on March 2, 2015 (80 FR 11140). The NPRM was prompted by in-shop findings of fatigue cracks on the No. 4.5 bearing thread undercut adjacent to the oil feed holes. The cracks were discovered during routine fluorescent penetrant inspections (FPIs). Both shafts had oil feed hole enlargement rework accomplished. The root cause is increased stress on the fillet of the thread undercut region in front of the oil feed holes caused by oil feed hole rework. The increased stress reduces the low cycle fatigue life of the shaft. The NPRM proposed to require removing affected LPT shafts from service using a drawdown plan. We are issuing this AD to prevent failure of the LPT shaft, which could lead to an uncontained engine failure and damage to the airplane.

We reviewed PW Service Bulletin (SB) No. JT8D 6504, dated November 5, 2014. The SB contains additional information regarding removal of the LPT shaft.

We gave the public the opportunity to participate in developing this AD. The following presents the comments received on the NPRM (80 FR 11140, March 2, 2015) and the FAA's response to each comment.

Delta Air Lines (DAL) and Allegiant Air requested that the current LPT shaft life limit of 25,000 cycles-since-new (CSN) be retained rather than removing the LPT shaft from service at 20,000 CSN as proposed in the NPRM. The commenters stated that reducing the life limit is unjustified because there has not been an in-service LPT shaft failure of the type addressed.

We do not agree. We determined that an acceptable level of safety would not be maintained if LPT shafts are allowed to remain in service until accumulating 25,000 CSN. We reduced the life of the LPT shaft to 20,000 CSN to minimize the risk of LPT shaft failure. We did not change this AD.

DAL and Allegiant Air proposed increasing the occurrence of FPIs to increase the opportunity of identifying LPT shaft cracks. The commenters stated that routine FPIs have been successful in detecting LPT shaft cracks in the past.

We do not agree. Recurring inspections are not adequate as a final corrective action. Relying on recurring FPIs to detect cracks, rather than shaft removal at 20,000 CSN, would likely result in an increased number of LPT shafts cracking in service, a greater risk of undetected cracked shafts being returned to service, and an unacceptable risk of shaft failure. We determined that long-term continued operational safety is enhanced by a terminating action that removes affected shafts from service rather than by increasing the occurrence of repetitive inspections. We did not change this AD.

DAL and Allegiant Air requested retaining the existing life limit or increasing the occurrence of inspections. The commenters stated that the life reduction in the NPRM places an undue economic burden on the U.S. fleet by forcing early engine removals.

We do not agree. We mitigated the operational and financial impacts by providing a drawdown plan rather than requiring removal before further flight, while providing an acceptable level of safety. We did not change this AD.

We reviewed the relevant data, considered the comments received, and determined that air safety and the public interest require adopting this AD as proposed.

We estimate that this AD will affect about 744 engines installed on airplanes of U.S. registry. The average labor rate is $85 per hour. We estimate the pro-rated replacement cost would be $28,230. We also estimate that shaft replacement would be accomplished during an engine shop visit at no additional labor cost. Based on these figures, we estimate the cost of the proposed AD on U.S. operators to be $21,003,120.

Title 49 of the United States Code specifies the FAA's authority to issue rules on aviation safety. Subtitle I, section 106, describes the authority of the FAA Administrator. Subtitle VII: Aviation Programs, describes in more detail the scope of the Agency's authority.

We are issuing this rulemaking under the authority described in Subtitle VII, Part A, Subpart III, Section 44701: “General requirements.” Under that section, Congress charges the FAA with promoting safe flight of civil aircraft in air commerce by prescribing regulations for practices, methods, and procedures the Administrator finds necessary for safety in air commerce. This regulation is within the scope of that authority because it addresses an unsafe condition that is likely to exist or develop on products identified in this rulemaking action.

This AD will not have federalism implications under Executive Order 13132. This AD will not have a substantial direct effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.

For the reasons discussed above, I certify that this AD:

(1) Is not a “significant regulatory action” under Executive Order 12866,

(2) Is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034, February 26, 1979),

(3) Will not affect intrastate aviation in Alaska to the extent that it justifies making a regulatory distinction, and

(4) Will not have a significant economic impact, positive or negative, on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

Accordingly, under the authority delegated to me by the Administrator, the FAA amends 14 CFR part 39 as follows:

The FAA has historically found the preservation of U.S. aviation history to be in the public interest, including preservation of certain former military aircraft transferred to private individuals or organizations for the purpose of restoring and operating these aircraft. In 1996, the FAA received exemption requests from not-for-profit organizations to permit the carriage of persons for compensation in both Limited and Experimental category, former-military, historically-significant aircraft. These requests offered to provide a short in-flight experience to these aircraft in exchange for compensation, leading to the term Nostalgia Flights, then later Living History Flight Experience (LHFE), and provided a means for private civilian owners to offset the considerable restoration, maintenance and operational costs. The FAA determined that, in certain cases, operators could conduct LHFE flights at an acceptable level of safety and in the public interest, in accordance with appropriate conditions and limitations.

These original requests involved large, crew-served, piston-powered, multi-engine World War II (WWII) vintage aircraft. In order to maintain safe operations of these aircraft, the FAA required flight crewmembers to meet certain qualifications and training requirements that included FAA-approved training, maintaining training records, and reporting procedures. As the public availability of purchase for former military aircraft increased, along with an increase in public interest for maintaining and operating these aircraft, so grew the requests for LHFE relief.

In 2004, to address a range of new aircraft requests and clarify the FAA's position, the FAA published a notice of policy statement (FAA-2004-17648). The policy limited LHFE relief to slower, piston-powered, multi-engine airplanes of WWII or earlier vintage, citing the unique opportunity to experience flight in aircraft such as the B-17 Flying Fortress and B-24 Liberator which could still be operated safely, considering limited parts and specialty-fuel supplies. In addition, qualifying aircraft would have no similar standard airworthiness counterpart that could allow a similar experience without the need for regulatory relief. The FAA also determined supersonic jets would not be considered because their operational speeds made it likely that any in-flight emergency may result in serious injuries or fatalities. The policy detailed that, in permitting the carriage of passengers, flight crewmembers were required to meet more stringent pilot qualifications as well as training requirements that included an FAA-approved training program, maintenance of training records, and reporting procedures.

In the years that followed, the FAA received petitions to operate a broad range of aircraft, including large turbojet-powered aircraft, foreign-manufactured aircraft and aircraft models that remained in military service, or were readily available in the open market. The petitions raised significant concerns within the FAA, and led to a reexamination and refinement of the criteria for issuing exemptions pertaining to LHFE flights.

In 2007, after requesting and receiving public comment on the matter, the FAA published an updated policy statement (72 FR 57196) that provided consideration for any aircraft on a case-by-case basis, so long as the petitioner demonstrates that (1) there is an overriding public interest in providing a financial means for a non-profit organization to continue to preserve and operate these historic aircraft, and (2) adequate measures, including all conditions and limitations stipulated in the exemption, will be taken to ensure safety. Additionally, the FAA refined and expanded its previous list of criteria, requiring numerous aircraft-operation components, including crew qualification and training, aircraft maintenance and inspection, passenger safety and training, safety of the non-participating public, as well as manufacturing criteria, and a petitioner's non-profit status. The FAA also included consideration for the number of existing operational aircraft and petitioners available to provide the historic service to the public.

The evolution of LHFE operations in the private sector, along with the availability of newer and more capable former military aircraft, raised new public safety and public policy concerns. The FAA accommodated several requests to operate more modern military jet aircraft. Conditions and limitations for operations grew in number, and were, in some cases, misinterpreted as permitting operations that the FAA did not contemplate or intend. Examples included cases of passengers manipulating the aircraft flight controls to proposals of LHFE flights performing aerobatic maneuvers, simulating aerial combat in the interest of “historical experience.”

Consequently, in 2011, the FAA published a new policy statement announcing a moratorium on LHFE exemptions for new operators and the addition of aircraft to existing LHFE exemptions. The moratorium permitted existing exemption holders to continue operations, and to renew their exemptions, but stated that the FAA would add clarifying limitations to all LHFE petitions renewed or extended during that time.

In June of 2012, the FAA held public meetings to gather additional technical input. Discussion addressed 35 questions posed by the FAA and included as part of the meeting notice. In addition to statements provided by the public meeting attendees, over 500 comments were received in the docket (Docket No. FAA-2012-0374) established for public input. The meeting was focused to address industry comments related to the LHFE policy notices of 2004 and 2007 and areas of concern based on safety recommendations, FAA internal discussions, and post 2007 developments. Small work groups were formed to discuss general policy, exemption issuance, limitations, weather minimums, pilot qualification and currency, and maintenance and inspection. The area of interest that generated the most discussion was regarding limitations placed on LHFE operations—specifically, passengers occupying crew seats or positions, aerobatics, and requirements for arresting gear for high performance jets. The largest general policy topic discussed was regarding whether the FAA planned on excluding turbojets or supersonic aircraft in the policy. The work groups also explored criteria for determining historical significance, replicas, operational control and responsible persons, manuals, compliance history, and training requirements.

The majority of the 519 written comments were either in favor of keeping the existing exemption policy or expanding on its provisions. Fifty-nine (11%) comment submissions desired no changes to the current LHFE policy. Eight commenters provided detailed comments to each of the questions posed within the FAA's areas of interest. In regards to training, safety and operational control, a commenter stated his belief that the employees/pilots/crew of the aircraft for hire have annual training and that the aircraft should be on an FAA/manufacturer approved inspection program, and that this training and adherence to the required and recommended inspections/maintenance provides a reasonable level of government protection to the flying and non-flying public. Eight commenters suggested a more restrictive LHFE Exemption policy, and one commenter supported the use of drug testing for LHFE flight crews. One commenter suggested that good guidance already exists in the A008 Operations Specification of Part 135 certificate holders, and that much of that guidance can be reasonably applied to LHFE. The FAA concurs and finds good reason to include certain elements found in part 135; specifically those related to operational control and document structure. 516 (99%) written comments expressed support for LHFE exemptions, while three (1%) were opposed.

The FAA also held meetings with curators at the Smithsonian National Air and Space Museum and reviewed the United States General Accounting Office (GAO) report on Preserving DOD Aircraft Significant to Aviation History to understand how other organizations determine “historical significance” as part of determining criteria to satisfy “public interest”.

Also during the moratorium, two accidents involving LHFE operators occurred which led the FAA to further research and develop safety mitigations to operational and maintenance issues highlighted by the investigations. The need to develop a safety and risk management system as part of the new policy was evident, and supported by comments received. One such comment stated, in part that it is important to try and mitigate some of the risks and to inform the public about the risks of the activity.

Therefore, based on FAA research, comments and transcripts of the public meeting, as well as an evaluation of public safety risks, the FAA finds good reason to publish a new policy. While the FAA is lifting the 2011 moratorium with this policy, we are also setting forth specific criteria that the FAA will use in considering any LHFE petition for exemption, or petition to extend or amend an existing exemption.

The FAA announces the end of the FAA-imposed moratorium on new petitions for exemption, or amendments to existing exemptions, from certain sections of 14 CFR for the purpose of carrying passengers for compensation or hire on LHFE flights. The FAA is also cancelling all previously issued LHFE policy statements. The FAA will now consider new petitions for exemption, or requests for extensions or amendments to current exemptions in accordance with the following criteria.

Each aircraft must be “historically significant” according to the following criteria:

1. U.S. operated: The aircraft must meet a documented set of U.S. military standards for its airworthiness and operations in U.S. military service.

2. Not in service: Aircraft currently operated by the U.S. military or in civilian service will not be considered. This exclusion includes variants of those aircraft.

3. Fragile: The aircraft must be “fragile.” Accepted practices in the collection of aircraft include “fragility” as a factor that necessitates preservation. If there are hundreds of models of a particular aircraft still flying, that aircraft's existence would not be considered “fragile.” If, on the other hand, there are few remaining aircraft and the model could become “extinct” without preservation efforts, that aircraft would be considered “fragile.” Each aircraft request will be reviewed for “fragility” on a case-by-case basis.

4. Age: The original type design must be at least 50 years old. This requirement is consistent with the policy used by the National Register of Historical Places to determine historical significance (Reference: National Register Bulletin: Guidelines for Evaluating and Documenting Historic Aviation Properties. US Department of Interior, 1998, p. 34-35).

5. No Available Standard Category Aircraft: Aircraft for which a standard category civilian model is available will not be considered. (e.g., the T-28A achieved certification as a standard aircraft, while the other versions, T-28B/C, etc. were strictly military variants and not eligible for certification in the standard category).

Replicas will not be considered. This element relates to the “integrity” of the structure or object as defined by the National Register of Historical Places, as described in the GAO report on Aircraft Preservation (Reference: Aircraft Preservation: Preserving DOD Aircraft Significant to Aviation History, GAO/NSIAD-8-170BR, May 1988, Appendix III, p. 13).

The FAA will review each petition to identify a responsible party, and an operational control structure or chain of command within the manual system for pilots, maintenance, and support personnel. Consequently, each petition should designate a responsible person whom the FAA can contact for both operations and maintenance functions.

The FAA will use Safety Risk Management (SRM) and Equal Level of Safety (ELoS) principles to guide its safety review in connection with any future LHFE exemption petition or request. This safety review will include, but will not be limited to, an analysis of whether hazards and risks have been identified and responded to through appropriate mitigating strategies. As such, each petitioner should be guided by the following criteria:

• An understanding and use of Safety Risk Management (SRM) principles.

• A plan to mitigate risks as they become known, or to correct an unsafe condition or practice. This includes, but is not limited to, risks in design, manufacturing, maintenance and operations.

• A detailed explanation of all supporting and historical safety-related data, such as: Maintenance history, airworthiness status, conformity to the Type Certificate Data Sheet (TCDS—for Limited category airworthiness certificates), operational failure modes, aging aircraft factors, and civilian and military accident rates. For example, the FAA will consider:

○ Operator history, including accidents and incidents, regulatory compliance and FAA surveillance history.

○ Maintenance records, including modifications.

○ Training records.

○ The aircraft's operational history, including the operator's proposed mitigation of known risks.

○ Operating limitations to enhance safety, clarify, and remediate differences in like aircraft.

○ The FAA will assess and, if necessary, require changes to passenger safety in terms of configuration, seats, crashworthiness, and emergency egress, etc.

• The operator should be able to demonstrate to the FAA, upon request, the passenger's ability to egress each aircraft in the event of an emergency in which the crewmember(s) is unable to assist.

LHFE operators should be able to demonstrate the existence of a manual system similar in terms of intent and scope of those in 14 CFR part 135. The FAA will evaluate the operator's manuals, including:

• Operations Manual (General Operations Manual-GOM).

• Pilot Training Manual and Qualifications.

• Maintenance and Line Support Training Manuals.

• Maintenance Manual (AIP) including, but not limited to:

○ Review of previously approved AIPs as provided by 14 CFR 91.415

○ Maintenance training elements.

○ Replacement plan for time-limited parts or development of an on-condition inspection program for such parts.

○ Aging aircraft inspection program.

○ Corrosion inspection program.

○ Continued Operational Safety (COS).

• SMS Manual.

LHFE operations, as it applies to the passenger(s) experience, is limited to the sole purpose of being onboard the aircraft during flight. The FAA will not consider expanded operations such as flight training, aerobatics, and passenger manipulation of the flight controls.

The FAA will always consider whether a request benefits the public as a whole and how the request would provide a level of safety at least equal to that provided by the rule in accordance with 14 CFR 11.81. Moreover, the FAA may impose additional conditions and limitations or deny petitions regardless of this policy statement to adequately mitigate safety concerns and risk factors as they become known.

To submit a petition for exemption or to request an amendment or extension to an existing exemption, all petitioners must follow the procedures set forth in part 11 of title 14 of the Code of Federal Regulations.

Table of Acronyms DHS Department of Homeland Security FR Federal Register NPRM Notice of Proposed Rulemaking TFR Temporary Final Rule A. Regulatory History and Information

The Coast Guard is issuing this temporary final rule safety zone for a planned fireworks show on San Diego Bay without prior notice and opportunity to comment pursuant to authority under section 4(a) of the Administrative Procedure Act (APA) (5 U.S.C. 553(b)). This provision authorizes an agency to issue a rule without prior notice and opportunity to comment when the agency for good cause finds that those procedures are “impracticable, unnecessary, or contrary to the public interest.”

Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good cause exists for not publishing a notice of proposed rulemaking (NPRM) with respect to this rule because publishing an NPRM would be impracticable because immediate action is needed to minimize potential danger to the participants and the public during the event. Furthermore, the necessary information to determine whether the marine event poses a threat to persons and vessels was provided 15 days before the event, which is insufficient time to publish an NPRM. Because fireworks barges on the navigable waterways poses significant risk to public safety and property and the likely combination of large numbers of recreation vessels and congested waterways could easily result in serious injuries or fatalities, this safety zone is necessary to safeguard spectators, vessels and the event participants. For the safety concerns noted, it is important to have these regulations in effect during the event and impracticable to delay the regulations.

Under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause exists for making this rule effective less than 30 days after publication in the Federal Register. For these same reasons, the Coast Guard finds good cause for implementing this rule less than thirty days before the effective July 23, 2015.

The legal basis and authorities for this temporary rule are found in 33 U.S.C. 1231; 50 U.S.C. 191; 33 CFR 1.05-1, 6.04-1, 6.04-6, and 160.5; and Department of Homeland Security Delegation No. 0170.1, which collectively authorize the Coast Guard to propose, establish, and define regulatory safety zones.

The Coast Guard believes establishing a temporary safety zone on the navigable waters of the San Diego Bay is necessary to ensure public safety for the fireworks display. A temporary safety zone will provide for the safety of the event participants, spectators, safety vessels, and other public users of the waterway. This event involves a planned fifteen minute fireworks display on a portion of San Diego Bay.

The Coast Guard is establishing a temporary safety zone that will be enforced from 8:30 p.m. to 9:30 p.m. on July 23, 2015. This safety zone is necessary to provide for the safety of the event participants, event spectators, safety patrol craft and to protect other vessels and users of the waterway. Persons and vessels will be prohibited from entering into, transiting through, or anchoring within this safety zone unless authorized by the Captain of the Port, or their designated representative. Before the effective period, the Coast Guard will publish a local notice to mariners (LNM). Just prior to the event and during the enforcement of the event, the Coast Guard will issue a broadcast notice to mariners (BNM) alert via VHF Channel 16.

This temporary safety zone will be bound by a 600 foot radius of the fireworks barge, center approximately on the following coordinate (North American Datum of 1983, World Geodetic System, 1984): 32°43.14 N, 117°10.36 W

We developed this rule after considering numerous statutes and executive orders related to rulemaking. Below we summarize our analyses based on these statutes and executive orders.

This rule is not a significant regulatory action under section 3(f) of Executive Order 12866, Regulatory Planning and Review, as supplemented by Executive Order 13563, Improving Regulation and Regulatory Review, and does not require an assessment of potential costs and benefits under section 6(a)(3) of Executive Order 12866 or under section 1 of Executive Order 13563. The Office of Management and Budget has not reviewed it under those Orders. We expect the economic impact of this rule to be so minimal that a full Regulatory Evaluation is unnecessary. This determination is based on the size, location and limited duration of the safety zone. This zone impacts a small designated area of the San Diego bay for less than one hour. Furthermore, vessel traffic can safely transit around the safety zone.

The Regulatory Flexibility Act of 1980 (RFA), 5 U.S.C. 601-612, as amended, requires federal agencies to consider the potential impact of regulations on small entities during rulemaking. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000. The Coast Guard certifies under 5 U.S.C. 605(b) that this rule will not have a significant economic impact on a substantial number of small entities. This rule will affect the following entities, some of which may be small entities: The owners or operators of private and commercial vessels intending to transit or anchor in the impacted portion of the San Diego Bay from 8:30 p.m. through 9:30 p.m. on July 23, 2015.

This safety zone will not have a significant economic impact on a substantial number of small entities for the following reasons. Vessel traffic can pass safely around the zone. The Coast Guard will publish a local notice to mariners (LNM) and will issue broadcast notice to mariners (BNM) alerts via VHF Channel 16 before the safety zone is enforced.

Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this rule. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please contact the person listed in the FOR FURTHER INFORMATION CONTACT, above.

Small businesses may send comments on the actions of Federal employees who enforce, or otherwise determine compliance with, Federal regulations to the Small Business and Agriculture Regulatory Enforcement Ombudsman and the Regional Small Business Regulatory Fairness Boards. The Ombudsman evaluates these actions annually and rates each agency's responsiveness to small business. If you wish to comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR (1-888-734-3247). The Coast Guard will not retaliate against small entities that question or complain about this rule or any policy or action of the Coast Guard.

This rule will not call for a new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).

A rule has implications for federalism under Executive Order 13132, Federalism, if it has a substantial direct effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government. We have analyzed this rule under that Order and determined that this rule does not have implications for federalism.

The Coast Guard respects the First Amendment rights of protesters. Protesters are asked to contact the person listed in the FOR FURTHER INFORMATION CONTACT section to coordinate protest activities so that your message can be received without jeopardizing the safety or security of people, places or vessels.

The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) requires Federal agencies to assess the effects of their discretionary regulatory actions. In particular, the Act addresses actions that may result in the expenditure by a State, local, or tribal government, in the aggregate, or by the private sector of $100,000,000 (adjusted for inflation) or more in any one year. Though this rule will not result in such an expenditure, we do discuss the effects of this rule elsewhere in this preamble.

This rule will not cause a taking of private property or otherwise have taking implications under Executive Order 12630, Governmental Actions and Interference with Constitutionally Protected Property Rights.

This rule meets applicable standards in sections 3(a) and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize litigation, eliminate ambiguity, and reduce burden.

We have analyzed this rule under Executive Order 13045, Protection of Children from Environmental Health Risks and Safety Risks. This rule is not an economically significant rule and does not create an environmental risk to health or risk to safety that may disproportionately affect children.

This rule does not have tribal implications under Executive Order 13175, Consultation and Coordination with Indian Tribal Governments, because it does not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes.

This action is not a “significant energy action” under Executive Order 13211, Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use.

This rule does not use technical standards. Therefore, we did not consider the use of voluntary consensus standards.

We have analyzed this rule under Department of Homeland Security Management Directive 023-01 and Commandant Instruction M16475.lD, which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (NEPA) (42 U.S.C. 4321-4370f), and have determined that this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. This rule involves the establishment of a safety zone on the navigable waters of San Diego Bay. This rule is categorically excluded from further review under paragraph 34(g) of Figure 2-1 of the Commandant Instruction. An environmental analysis checklist supporting this determination and a Categorical Exclusion Determination are available in the docket where indicated under ADDRESSES. We seek any comments or information that may lead to the discovery of a significant environmental impact from this rule.

For the reasons discussed in the preamble, the Coast Guard amends 33 CFR part 165 as follows:

Regulatory History

80 FR 26517, May 8, 2015

The Postal Accountability and Enhancement Act (PAEA), Public Law 109-435, 120 Stat. 3198 (2006), authorizes the Commission to develop rules and establish procedures that it deems necessary and proper to carry out Commission functions.1

On May 4, 2015, the Commission issued a notice of proposed rulemaking establishing procedures that would simplify the docket closure process by permitting automatic closure of a docket following a significant period of inactivity.2 The Notice requested comments from interested persons regarding the proposed rules. The Commission received comments from the Postal Service and the Public Representative.3 After consideration of the comments submitted, the Commission adopts the proposed rules, modified as described below.

The Postal Service and Public Representative offered positive comments and suggested revisions with respect to the Commission's proposed rules.

The Postal Service agrees that an automatic closure procedure would promote efficient docket management and provide clarity for the public because it would clear out items listed on the Commission's Web site. Postal Service Comments at 1. However, the Postal Service has concerns that, in certain proceedings, a docket may be automatically closed due to 12 consecutive months of inactivity prior to a final order being issued by the Commission. Id. at 1-2. The Postal Service recommends proposed rule 3001.44(a) be revised to indicate that if the final order in a docket is pending, it will not be subject to automatic closure. Id. at 2.

In addition, the Postal Service recommends that the Commission provide notice to the public of the impending docket closure at least 30 days prior to the automatic closure date. Id. The Postal Service also suggests that a motion to stay automatic closure be filed at least 15 days prior to closing, rather than 10 days prior to closing, in order to provide parties ample time to file answers pursuant to rule 3001.21. Id. at 2-3.

Finally, the Postal Service argues that because the Commission does not file motions under rule 3001.21, a separate paragraph should be added to indicate that the Commission may issue an order sua sponte keeping a docket open. Id. at 3.

The Public Representative supports the establishment of rules that create more streamlined procedures for closing inactive dockets. PR Comments at 2. However, she recommends clarifying the meaning of “good cause” found in rule 3001.44(c) as interested persons may not be aware that grounds for a motion to reopen exist, and she provides definitions and terms used by other agencies. Id.

The Public Representative does not go so far as to recommend filing a public notice with the Federal Register; however, she suggests providing notification to the public via the Commission's Web site. She argues that such a notice would “achieve due process and transparency without significant administrative burden or loss of efficiency.” Id. at 3.

Finally, the Public Representative recommends that the rules be revised in order to clarify that the Commission may issue an order sua sponte, keeping a docket open or reopening an automatically closed docket, as the Commission does not file motions pursuant to rule 3001.21. Id. at 2-3.

Proposed rule 3001.44(a). Paragraph (a) of proposed rule 3001.44 would permit the Commission to automatically close a docket after 12 consecutive months of inactivity, in order to ensure that information provided to the public on the status of dockets remains current. In its comments, the Postal Service describes a situation that could arise in which a docket has been automatically closed due to inactivity despite the eventual issuance of a final order. The Postal Service provides examples of similar situations including Docket No. MC2010-24, concerning the Commission's review of Nonpostal Services language for the Mail Classification Schedule (MCS). The initial notice was issued on May 5, 2010, and comments were received on June 4, 2010, and June 18, 2010.4 However, the docket saw no further activity until the Commission issued its final order on December 11, 2012.5

The Postal Service recommends the Commission add language to paragraph (a) indicating that if the final order in a docket is pending, it will not be subject to automatic closure. Based on consideration of the Postal Service's comment and the possibility that certain dockets may take significant time to resolve, the Commission agrees with the Postal Service that a revision to the rule is necessary. Paragraph (a) will be revised to exclude from automatic closure those dockets in which a final determination by the Commission is required by rule or statute, or if the Commission has otherwise indicated a final order is forthcoming in the docket, but is still outstanding.

Proposed rule 3001.44(b) and (d). Both the Postal Service and the Public Representative recommend revisions to the proposed rules that would clarify the Commission's ability to issue an order staying automatic closure or reopening an automatically closed docket as the Commission does not file motions pursuant to rule 3001.21. The Commission recognizes that proposed paragraphs (b) and (d), could be interpreted to read that the Commission may stay automatic closure or reopen an automatically closed docket via motion. As the Commission would instead issue an order sua sponte, clarification to the rule is necessary. The Commission declines to adopt the particular revised language proposed by the Postal Service and instead revises proposed paragraphs (b) and (d) by removing both paragraphs from proposed rule 3001.44 to create new rule 3001.45. As revised, rule 3001.44 describes automatic docket closure and rule 3001.45 describes actions permitted by interested persons and the Commission concerning automatic docket closure. Subparagraphs (a)(2) and (b)(2) were added to indicate the Commission may stay an automatic docket closure or reopen an automatically closed docket upon its own order.

In addition, the Public Representative argues that proposed rule 3001.44(d) could benefit from a more detailed definition of “good cause.” PR Comments at 2. She provides terms used by other agencies such as “new and material information” not available or known at the time of the determination. Id. However, the addition of specific terms such as “new” and “material,” or requiring that information became available only after a docket was automatically closed, creates restrictive requirements that may unintentionally limit interested persons from requesting an automatically closed docket be reopened. The Commission favors the use of a broader term that puts fewer limits on an interested person's justification for a motion to reopen an automatically closed docket and prefers to use its discretion when evaluating whether the justification for reopening an automatically closed docket qualifies as “good cause.” 6 The Commission, therefore, declines to adopt the Public Representative's recommended revisions to rule 3001.44(d).

Finally, proposed rule 3001.44(b) required a motion to stay automatic closure be filed at least 10 days prior to the automatic closure date. The Postal Service suggested an increase in the time for filing a motion to stay from 10 days to 15 days prior to the automatic docket closure date, in order to provide any participant with an opportunity to answer the motion pursuant to rule 3001.21(b). Postal Service Comments at 2-3. The Commission agrees and accepts the Postal Service's recommendation. This revision is reflected in rule 3001.45(a)(1) and (a)(2).

Public notice. The Postal Service suggests some form of public notice be given 30 days prior to the automatic closure date. Postal Service Comments at 2. The Public Representative argues that a formal public notice (published in the Federal Register) is unnecessary and instead recommends a portion on the Commission's Web site be used to broadcast dockets that would automatically close in the next 6 months and provide the deadline for filing a motion to stay automatic closure. PR Comments at 3.

The Commission finds merit in providing transparency to the docket closure process as suggested by the Postal Service and Public Representative. Providing information concerning potential automatic docket closures on the Commission's Web site will not be costly nor will it materially interfere with the simplification of the docket closure process. The Commission revises the rule to include a new paragraph that states each month the Commission will post on its Web site a list of dockets that will, without action taken by parties or the Commission, be subject to automatic closure in the following month and the scheduled date of closure for each docket. This revision is reflected in rule 3001.44(b).

Additional minor correction. The Commission makes the following minor correction:

• In paragraphs (a) and (b) of rule 3001.45 “any interested party or participant” is simplified to read “interested persons.”

It is ordered:

1. Part 3001 of title 39, Code of Federal Regulations, is revised as set forth below the signature of this Order, effective 30 days after publication in the Federal Register.

2. The Secretary shall arrange for publication of this order in the Federal Register.

For the reasons discussed in the preamble, the Commission amends chapter III of title 39 of the Code of Federal Regulations as follows:

This is a summary of the Commission's Report and Order, FCC 15-59, MD Docket No. 15-121, adopted on May 20, 2015 and released May 21, 2015.

1. As required by the Regulatory Flexibility Act of 1980 (RFA),1 the Commission has prepared a Final Regulatory Flexibility Analysis (FRFA) relating to this Report and Order.

2. The Commission will send a copy of this Report and Order and Order to Congress and the Government Accountability Office pursuant to the Congressional Review Act. 5 U.S.C. 801(a)(1)(A).

3. This Report and Order does not contain any new or modified information collection burden for small business concerns with fewer than 25 employees, pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506 (c) (4).

4. Finally, in the Order section of this document, we amend three sections of our rules 2 to conform to the Digital Accountability and Transparency Act (DATA Act) concerning when claims should be transferred to the Secretary of the Treasury.3 In particular, we make the ministerial change to our rules to specify that debts owed to the Commission that have been delinquent for a period of 120 days shall be transferred to the Secretary of the Treasury. The rules previously specified transfer of delinquent debt to the Treasury after 180 days.

5. In the Report and Order, the Commission adopted a proposal from our FY 2014 Further Notice of Proposed Rulemaking to add a new subcategory in the existing cable television and Internet Protocol TV (IPTV) regulatory fee category for direct broadcast satellite (DBS) providers.4 In addition, we provide specific instructions regarding our new regulatory fee requirement for toll free numbers.5 We also remove amateur radio Vanity Call Signs and General Mobile Radio Service (GMRS) from the regulatory fee schedule.6 The addition of DBS to the cable television and IPTV category and removal of two wireless categories from the schedule are permitted amendments to the regulatory fee schedule and require Congressional notification.7

6. The Commission is required by Congress to assess regulatory fees each year in an amount that can reasonably be expected to equal the amount of its appropriation.8 Regulatory fees, assessed each fiscal year, are to “be derived by determining the full-time equivalent number of employees performing” these activities, “adjusted to take into account factors that are reasonably related to the benefits provided to the payer of the fee by the Commission's activities. . . .” 9 Regulatory fees recover direct costs, such as salary and expenses; indirect costs, such as overhead functions; and support costs, such as rent, utilities, or equipment.10 Regulatory fees also cover the costs incurred in regulating entities that are statutorily exempt from paying regulatory fees,11 entities whose regulatory fees are waived,12 and entities that provide nonregulated services. Congress sets the amount the Commission must collect each year in the Commission's fiscal year appropriations, and section 9(a)(2) of the Communications Act of 1934, as amended (Communications Act or Act) requires the Commission to collect fees sufficient to offset the amount appropriated.13 To calculate regulatory fees, the Commission allocates the total collection target, as mandated by Congress each year, across all regulatory fee categories. The allocation of fees to fee categories is based on the Commission's calculation of full time employees (FTEs) 14 in each regulatory fee category. Historically, the Commission has classified FTEs as “direct” if the employee is in one of the four “core” bureaus; otherwise, that employee was considered an “indirect” FTE.15 The total FTEs for each fee category includes the direct FTEs associated with that category, plus a proportional allocation of the indirect FTEs.

7. Section 9 of the Communications Act requires the Commission to make certain changes (i.e., mandatory amendments) to the regulatory fee schedule if it “determines that the Schedule requires amendment to comply with the requirements” of section 9(b)(1)(A).16 In addition, the Commission must add, delete, or reclassify services in the fee schedule to reflect additions, deletions, or changes in the nature of its services “as a consequence of Commission rulemaking proceedings or changes in law.” 17 These “permitted amendments” require Congressional notification.18 The changes in fees resulting from both mandatory and permitted amendments are not subject to judicial review.19

8. The Commission continues to improve the regulatory fee process by ensuring a more equitable distribution of the regulatory fee burden among categories of Commission licensees under the statutory framework in section 9 of the Communications Act. For example, in 2013, the Commission updated the FTE allocations to more accurately align regulatory fees with the costs of Commission oversight and regulation,20 as recommended in the GAO Report, a report issued by the Government Accountability Office (GAO) in 2012.21 The Commission also reallocated some FTEs from the International Bureau as “indirect.” 22 Subsequently, in the FY 2014 Report and Order, the Commission adopted the new toll free number regulatory fee category 23 and, in the accompanying FY 2014 Further Notice of Proposed Rulemaking, the Commission sought additional comment on a new regulatory fee category for DBS.24 In this Report and Order, we now add a subcategory for DBS providers in the cable television and IPTV regulatory fee category based on our finding that Media Bureau FTEs work on issues and proceedings that include DBS as well as other multichannel video programming distributors (MVPDs).

9. In the FY 2014 NPRM, 25 we sought comment on eliminating several of the smaller regulatory fee categories such as amateur radio Vanity Call Signs 26 and GMRS.27 In the FY 2014 Report and Order, we concluded that we did not yet have adequate support to determine whether the cost of recovery and burden on small entities outweighed the collected revenue or whether eliminating the fee would adversely affect the licensing process.28 We stated, however, that we would reevaluate this issue in the future. Since adoption of the FY 2014 Report and Order, Commission staff have had an opportunity to obtain and analyze support concerning the collection of fees from these regulatees.

10. The GMRS and amateur radio Vanity Call Sign regulatory fee categories comprise on average over 20,000 licenses that are newly obtained or renewed every five and 10 years, respectively. After five years, the GMRS licensee is responsible for renewing the license (or cancelling) and the Commission is responsible for maintaining accurate records of licenses coming up for renewal—an administrative burden on both GMRS users and on the Commission for renewing and maintaining records of these licenses. After analyzing the costs of processing fee payments for GMRS, we conclude that the Commission's cost of collecting and processing this fee exceeds the payment amount of $25. Our costs have increased over time and now that the costs exceed the amount of the regulatory fee, the increased relative administrative cost supports eliminating this regulatory fee category.

11. The Vanity Call Sign fee category has a small regulatory fee ($21.40 in FY 2014) for a 10-year license. The Commission often receives multiple applications for the same vanity call sign, but only one applicant can be issued that call sign. In such cases, the Commission issues refunds for all the remaining applicants. In addition to staff and computer time to process payments and issue refunds, there is an additional expense to issue checks for the applicants who cannot be refunded electronically. The Commission spends more resources on processing the regulatory fees and issuing refunds than the amount of the regulatory fee payment. As our costs now exceed the regulatory fee, we are eliminating this regulatory fee category.

12. The Commission will therefore eliminate the GMRS and Vanity Call Sign regulatory fee categories after the required congressional notification is provided.29 Once eliminated, these licensees will no longer be financially burdened with such payments and the Commission will no longer incur these administrative costs that exceed the fee payments. The revenue that the Commission would otherwise collect from these regulatory fee categories will be proportionally assessed on other wireless fee categories. This is a “permitted amendment” as defined in section 9(b)(3) of the Act, which, pursuant to section 9(b)(4)(B, must be submitted to Congress at least 90 days before it becomes effective.30

13. Toll free numbers, defined in section 52.101(f) of our rules,31 allow callers to reach the called party without being charged for the call. Instead, the charge for the call is paid by the called party (the toll free subscriber).32 Prior to the FY 2014 Report and Order, the Commission did not assess regulatory fees on toll free numbers based on the assumption that the entities controlling the numbers—wireline and wireless common carriers—were paying regulatory fees based on either revenues or subscribers.33 In the FY 2014 NPRM, we observed this was no longer the case because many toll free numbers are now controlled or managed by RespOrgs 34 that are not common carriers.35 In the FY 2014 Report and Order, we adopted a regulatory fee obligation for toll free numbers beginning in FY 2015, finding that the Commission has both the legal authority and responsibility to assess regulatory fees on toll free numbers.36 This regulatory fee assessed on RespOrgs for toll free numbers managed by a RespOrg,37 is payable for all toll free numbers unless calls from only other countries can be completed using those toll free numbers.38 This regulatory fee is assessed on RespOrgs for each working, assigned, reserved, in transit, or any other status of toll free number as defined in section 52.103 of the Commission's rules. Interstate Telecommunications Service Providers (ITSPs) that are RespOrgs and RespOrgs that are not ITSPs will be responsible for this regulatory fee.

14. The decision in 2014 to expand the pool of regulatory fee obligations to all RespOrgs created a system in which there are now numerous entities that play a role in toll free number administration and are required to pay annual regulatory fees but are not common carriers and therefore may lack familiarity with the Commission's rules. In the FY 2014 Report and Order, we did not adopt a specific enforcement mechanism to address circumstances where RespOrgs do not make regulatory fee payments but instead, sought further comment on the additional procedures for enforcement in such instances.39 Instead of adopting additional enforcement procedures at this time, however, we direct SMS/800, Inc.40 to provide the necessary outreach to the RespOrgs, through its tariff, Web site, or otherwise, to advise them that: “The Federal Communications Commission (FCC) has adopted a regulatory fee category for toll free numbers, assessed for each toll free number managed by a Responsible Organization (RespOrg). This regulatory fee, assessed on RespOrgs for toll free numbers managed by a RespOrg, is payable for all toll free numbers unless calls from only other countries can be completed using those toll free numbers. A RespOrg that fails to pay the regulatory fee assessed by the FCC will be subject to penalties.” 41

15. The imposition of a regulatory fee on RespOrgs is a new rule, adopted in the FY 2014 Report and Order, and non-common carriers may be unfamiliar with our regulatory fee process and unaware that delinquencies can result in penalties imposed by SMS/800, Inc., penalties imposed by the Commission pursuant to the Debt Collection Improvement Act of 1996 (DCIA), and/or enforcement action by the Enforcement Bureau, pursuant to delegated authority, or by the Commission.42 As a result, OMD will coordinate with SMS/800, Inc. to ensure that all RespOrgs owing regulatory fees have sufficient information about this process and opportunity to pay the regulatory fee before the RespOrg is placed in red light status and enforcement procedures are initiated.43

16. The basis for identifying the toll free number count upon which a regulatory fee will be assessed for each RespOrg will be derived from data provided by SMS/800, Inc.44 The toll free number data will be determined by the toll free number count as of or around December 31st of each year. In addition to maintaining contact information with SMS/800, Inc., RespOrgs are also responsible for: (i) Obtaining an FRN (FCC Registration Number); 45 (ii) maintaining current contact information in the Commission Registration System (CORES); 46 (iii) reviewing the Commission's Regulatory Fees Home Page for updates on regulatory fees; 47 and (iv) making timely regulatory fee payments using the Commission's Electronic Filing and Payment System (Fee Filer) located at: www.fcc.gov/feefiler. SMS/800, Inc. will provide the Commission with up-to-date contact information for the RespOrgs as needed to facilitate the timely payment of regulatory fees for toll free numbers. Under our bill collection procedures, delinquent RespOrgs will receive notice from the Commission before the matter is referred to the Enforcement Bureau for enforcement action and/or penalties imposed by SMS/800, Inc.

17. Any payments RespOrgs must pay SMS/800, Inc. for toll free number management and administration are unrelated to regulatory fees assessed by the Commission. Payment of regulatory fees to the Commission does not relieve a RespOrg from any payment obligations to SMS/800, Inc.

18. DBS service is a nationally distributed subscription service that delivers video and audio programming via satellite to a small parabolic “dish” antenna at the subscriber's location. DBS providers are multichannel video programming distributors (MVPDs), as defined in section 602(13) of the Act.48 These operators of U.S. licensed geostationary space stations, which are used to provide one-way subscription video service to consumers in the United States, currently pay a fee per U.S.-licensed satellite under the category “Space Station (Geostationary Orbit)” in the regulatory fee schedule based on the International Bureau FTEs work associated with satellite regulation. Cable television and IPTV, also MVPDs, similarly provide subscription video services to consumers in the United States. These regulated entities pay a regulatory fee per subscriber under the fee category “Cable TV System, Including IPTV.” 49 In the Further Notice of Proposed Rulemaking accompanying the FY 2014 Report and Order, the Commission proposed to adopt a fee to recover the costs incurred by the Media Bureau for regulation of DBS.50 Under our proposal, DBS providers would be subject to two regulatory fees. The first fee would recover the burden of regulation and oversight by International Bureau FTEs incurred as a result of its operation of satellites, and the other fee would recover the burden of regulation and oversight by Media Bureau FTEs as a result of DBS status as a MVPD. We conclude that DBS providers are subject to regulation and oversight of the Media Bureau and should share in the Media Bureau FTE burden attributed to MVPDs. Accordingly, pursuant to section 9(b)(3), we amend the regulatory fee schedule to replace the category “Cable TV System, Including IPTV” with the “Cable TV System, Including IPTV and DBS” category. This category will now have two rates: One for DBS (a subcategory) and another for cable television and IPTV.

19. Background. The Commission has considered the appropriate methodology for assessing regulatory fees on DBS providers on multiple occasions. The original fee schedule adopted by Congress in 1993, when the DBS service was a nascent industry,51 did not include a specific fee category for DBS providers.52 The Commission recognized this and declined to adopt a regulatory fee for DBS until fiscal year 1996.53 In the FY 1996 NPRM, the Commission determined that including the fledgling DBS service in the regulatory fee imposed on geostationary orbit geosynchronous satellite category best reflected the regulatory burden born by the Commission at that time.54 In the 2005,55 2006,56 and 2008 57 regulatory fee proceedings, the Commission also considered whether DBS should pay a subscriber-based regulatory fee related to Media Bureau oversight instead of being included in the geosynchronous satellite category related to International Bureau oversight. In those proceedings, the Commission either declined to adopt a change or made no decision on the issue. In the FY 2005 Report and Order, in declining to make a change, the Commission noted its FY 2005 NPRM had not contained a proposal on the issue.58 In the FY 2006 Report and Order, the Commission decided not to change the fee. In the FY 2009 Report and Order, the Commission declined to address the issue raised in the FY 2008 Report and Order and Further Notice. 59

20. In August of 2012, the GAO Report concluded that regulatory fee reform at the Commission was long overdue.60 The GAO Report observed, among other things, that questions had been raised by commenters regarding whether the Commission's regulatory fee analysis was based on a “valid FTE analysis” of Media Bureau FTEs work related to the MVPDs including DBS.61 Following the GAO Report, in the fiscal year 2013 regulatory fee proceeding, the Commission considered and adopted a number of significant regulatory fee reforms such as updating the FTEs allocated to each of the core bureaus and reclassifying most of the International Bureau FTEs as indirect.62 The Commission also adopted other reforms such as broadening the cable television category to include IPTV providers as a “permitted amendment.” 63 As part of its overall analysis of the cable television systems category, the Commission considered a change to the DBS fee schedule.64 While the Commission declined to do so in 2013 to allow additional time to examine the proposal as part of larger reform efforts, the Commission noted its intent to revisit the issue in the future.65 In 2014, the Commission again proposed to adopt a fee to recover the costs incurred by the Media Bureau for regulation of DBS in the FY 2014 NPRM and the FY 2014 Further Notice of Proposed Rulemaking.66 Alternatively, the Commission sought comment on whether Media Bureau FTEs working on DBS issues be assigned to the International Bureau as direct FTEs or assigned as indirect FTEs for regulatory fee purposes.67

21. Discussion. Under section 9 of the Act, the Commission may make a permitted amendment to the fee schedule if it “determines that the Schedule requires amendment to comply with the requirements of” paragraph (1)(A) which mandates that the Commission allocate fees to cover the costs of certain regulatory activities in accordance with the benefits provided to the payor and other factors that the Commission determines are in the public interest.68 The statute also provides, however, that, “[i]n making such amendments, the Commission shall add, delete, or reclassify services in the Schedule to reflect additions, deletions or changes in the nature of its services as a consequence of Commission rulemaking proceedings or changes in law.” 69 We have conducted a review of the Media Bureau work devoted to MVPD matters and find that the recommendations in the GAO Report were correct.70 Analysis of the oversight and regulation of MVPDs (including the DBS industry) by the Media Bureau in various rulemaking proceedings reveal a cumulative effect of changes in law that have taken effect since the Commission adopted the current DBS regulatory fee structure in 1996. Due to these changes, we find that the DBS providers should be included in the same fee category as the other MVPDs, such as cable television and IPTV. There are certain rules that both DBS providers and cable operators including IPTV are subject to, and Media Bureau FTEs provide the oversight and regulation of the DBS industry as required by these rules.71 For example, DBS providers (and cable television operators) are permitted to file program access complaints 72 and complaints seeking relief under the retransmission consent good faith rules.73 In addition, DBS providers are subject to MVPD requirements such as those pertaining to program carriage 74 and the requirement to negotiate retransmission consent in good faith.75 More recently, the Commission adopted a host of requirements that apply to all MVPDs and thus equally apply to DBS providers as part of its implementation of the Commercial Advertisement Loudness Mitigation Act (CALM Act),76 the Twenty-First Century Communications and Video Accessibility Act of 2010 (CVAA),77 as well as the Satellite Television Extension and Localism Act (STELA) Reauthorization Act of 2014 (STELAR).78 These regulatory developments increased the amount of regulatory activity by the Media Bureau FTEs involving regulation and oversight of MVPDs, including the DBS providers. The Media Bureau has been responsible for adopting many of these regulations and overseeing the MVPD industry. As MVPDs, DBS providers actively participate in Media Bureau proceedings involving MVPD oversight and regulation.79

22. DIRECTV and DISH disagree that a permitted amendment is justified, contending that there has been no “meaningful increase in the regulation of DBS.” 80 To the contrary, as discussed above, implementation of the CALM Act, CVAA, and STELAR should alone provide adequate justification for a permitted amendment in this case. A permitted amendment under section 9(b)(3), however, does not require a sudden increase in regulation or oversight over a defined period of time. Circumstances have changed in the almost 20 years since the Commission first addressed the issue of DBS regulatory fees.81 At the time we adopted a DBS regulatory fee, it was a fledging service where the business model was uncertain and there were questions concerning whether it would operate as a subscription based service or a free to air broadcaster.82 The first DBS satellite was not launched until 1993 and did not become operational until 1994.83 In 2015, however, DBS had developed into a large MVPD 84 and as such significant Media Bureau FTE resources are used in regulation and oversight of DBS. The GAO Report correctly noted that an evaluation of Media Bureau FTEs was long overdue 85 and the result of such evaluation leads us to the conclusion that the Media Bureau FTEs regulate the DBS industry together with the other MVPDs. Thus, there is no reasonable basis to exclude DBS providers from sharing in the cost of MVPD oversight and regulation. With this Report and Order, we recognize the changes in fact and law since the adoption of the DBS fee in 1996 cumulatively require us to adopt a permitted amendment to ensure that DBS providers contribute equitably to the FTE burden of MVPD oversight.86

23. We also reject the argument raised by DIRECTV and DISH that section 9 of the Act requires us to “show that DBS and cable occupy a comparable number of FTEs.” 87 The commenters' argument that DBS is not involved in certain matters such as petitions for effective competition,88 or other requirements that do not pertain to DBS,89 demonstrates that DBS is not identical to cable television. It does not, however, refute our conclusion that a significant number of Media Bureau FTEs work on MVPD issues that include DBS.90 The Commission has determined in other proceedings that services that are not technologically identical nevertheless warrant placement in the same regulatory fee category. Other fee categories, such as Interstate Telecommunications Service Providers (ITSP), also include a range of carriers that may not be regulated identically.91 For example, when interconnected Voice over Internet Protocol (VoIP) providers were added to the ITSP category in a permitted amendment the Commission observed that “the costs and benefits associated with our regulation of interconnected VoIP providers are not identical as those associated with regulating interstate telecommunications service and CMRS.” 92 The Commission stated that “Section 9 is clear, however, that regulatory fee assessments are based on the burden imposed on the Commission, not benefits realized by regulatees.” 93 Concerning many aspects of MVPD regulation, Media Bureau FTEs bear the same burden regardless of the specific technology used by the service provider. Thus, although DBS is not identical to cable television and IPTV, the services all receive oversight and regulation as a result of the work of Media Bureau FTEs on MVPD issues. The burden imposed on the Commission is therefore similar.

24. DIRECTV and DISH also observe that there are more cable operators and cable systems than DBS operators, and that the cable industry has a larger filing and recordkeeping requirement than DBS.94 While we agree that the two DBS providers and their trade association had fewer filings than the top 25 cable operators and their two trade associations (combined), we are not persuaded that this demonstrates a lack of Media Bureau oversight and regulation of the DBS industry.95 We are therefore including DBS providers into the same regulatory fee category as cable television and IPTV because many Media Bureau issues involve the entire MVPD industry. We find that it is appropriate under section 9 of the Act to recover the costs associated with Media Bureau FTE work.96 As we explain below, however, DBS will have an opportunity to raise questions concerning the rate calculation between it and other members of the same fee category for fiscal year 2015 and in the future.97 The video programming and distribution industry continues to change 98 and the appropriate allocation between and among regulatees with respect to Media Bureau FTEs working on MVPD issues may change over time as different regulatory and legal issues are presented to the Commission.

25. To the extent that DIRECTV and DISH are suggesting by these arguments that the number of FTEs dedicated to a service is wholly determinative of their regulatory fees, we disagree. Although the statute requires us to calculate FTEs initially, we are also required to “adjust[]” that number “to take into account factors that are reasonably related to the benefits provided to the payor of the fee by the Commission's activities.” 99 Since DBS providers generally benefit from the regulatory activities of the Media Bureau, much like cable operators and IPTV providers, the Commission can attribute Media Bureau FTEs to DBS providers and require them to pay Media Bureau regulatory fees.

26. DIRECTV and DISH also argue that because we declined to include DBS in the cable television and IPTV regulatory fee category previously, we must provide a reasoned explanation for changing our fee determination.100 We agree that it serves the public interest to explain our rationale. A prior decision, however, does not preclude us from making a different determination in light of the facts and circumstances presented to the Commission in 2015. When the Commission first determined to include DBS in the geosynchronous satellite regulatory fee, DBS was a new service with an uncertain business model. Imposing a subscription based fee derived from Media Bureau FTEs risked failing to compensate the Commission for the substantive work regulating DBS as a satellite industry.101 When we examined the issue again in 2005, 2006, and 2008, contemporaneously there was a significant amount of regulatory work being done by the International Bureau related to making new spectrum available for satellite based video services.102 Thus, it is not surprising that the Commission concluded in 2006 that the existing methodology adequately ensured recovery of International Bureau FTE burden of oversight and regulation. Further, removing DBS from the geosynchronous satellite regulatory fee category at a time when that fee category bore the burden of substantial rulemakings relating to new satellite spectrum would have been a complex issue. While the burden of new satellite rulemakings was not mentioned by the Commission in the FY 2006 Report and Order, review of the context in which decisions are made is appropriate here. Further, in the past, changes to the DBS regulatory fee was frequently described as either a fee assessed based on International Bureau FTEs or a fee based on Media Bureau FTEs. In contrast, our proposal presents a more nuanced approach of recognizing that the work of both the International Bureau FTEs and the Media Bureau FTEs provide oversight and regulation of DBS. As a result, while the decisions made in the past are understandable in their context, we are not bound to disregard the FTE burden born by the Media Bureau in regulating DBS as a MVPD simply because we previously declined to change the methodology of assessing fees on DBS providers.

27. Regulatory fee reform is a logistical challenge due to the time constraints in regulatory fee proceedings which typically must be completed in a year in order to satisfy our statutory mandate. Unfortunately, at times we must decline to adopt a proposal or take an incremental approach, not because a proposal lacks merit, but simply because there is insufficient time to address the substantive comments raised in the record in the time allotted.103 In this instance, however, we have the benefit of comments regarding this issue from the FY 2013 NPRM, the FY 2014 NPRM, and the FY 2014 Further Notice of Proposed Rulemaking. As a result, unlike prior review of this issue, we have had more time within which to review the significant issue of adopting an additional fee category for DBS providers. The GAO Report also brought new focus to conducting the necessary analysis of Media Bureau FTEs as part of our overall regulatory fee reform.104 Had the Commission performed this analysis of Media Bureau FTEs and regulation and oversight of DBS earlier, we may have reached this result at that time. The Commission may update its regulatory fee methodology when, among other things, it is supported by updated data, analysis, and changes in the regulation and oversight of the industry. As the GAO Report observed, it is important to “regularly update analyses to ensure that fees are set based on relevant information.” 105

28. Finally, DISH and DIRECTV contend that a “fee increase will cause rate shock” 106 and argue that we must explain the basis of any regulatory fee increase exceeding 7.5 percent relying upon a cap we adopted for FY 2013.107 We note first that it is somewhat premature to address this concern since the rate for DBS providers is merely proposed in the accompanying NPRM, and DISH and DIRECTV, the two DBS providers, may provide comments on the rate for this year and in subsequent years. As to the substance of the complaint, we note that this cap was adopted due to the significant regulatory fee changes adopted that year and our concern on the impact on small entities; neither DISH nor DIRECTV claim that they are small entities. We are not required to adopt a cap every year and we are not seeking comment on such a cap for FY 2015 in our NPRM above. Due to their concern that the regulatory fee would have such an impact on their customers, we have decided to phase in the DBS fee and introduce it initially as a subcategory of the cable television and IPTV category.108 This phased approach is consistent with the interim approach the Commission took in the FY 2013 Report and Order to “avoid sudden and large changes in the amount of fees” 109 and addresses DIRECTV and DISH's concerns.110

29. We also note that we sought comment on whether the operator of the satellite or the provider of DBS service should be the entity that pays the regulatory fee.111 As the fee is based on subscriber numbers, the DBS service provider would be the entity with this information and it would be more efficient for those DBS providers to be responsible for the regulatory fee. For purposes of calculating regulatory fees, the subscriber count includes single family dwellings as well as individuals in multiple dwelling units (e.g., apartments, condominiums, mobile home parks) based on the formula in the footnote below.112

30. In the FY 2014 Further Notice of Proposed Rulemaking, we further sought comment on whether, in lieu of a permitted amendment, Media Bureau FTEs working on DBS issues should be assigned to the International Bureau as direct FTEs or assigned as indirect FTEs.113 These alternatives would, in some ways, allocate the Media Bureau FTEs for regulatory fee purposes in a way that is fairer than the current allocation. DBS providers would be paying regulatory fees for some of the Media Bureau FTEs, if reallocated as direct FTEs to the International Bureau. If we reallocated some Media Bureau FTEs as indirect, the regulatory fee burden would be spread among all regulatory fee payors, which would relieve the burden on the cable television and IPTV industry. Although these two alternatives would serve to reallocate a portion of the Media Bureau FTEs, such reallocation would either shift the burden to all International Bureau regulatees or to all regulatory fee payors, instead of to the DBS providers. Thus, although those two alternative proposals might be an improvement over the status quo, including DBS in the same category as cable television and IPTV, and basing the regulatory fee on Media Bureau FTEs, is the more straightforward and equitable approach because the DBS regulation and oversight is done by the Media Bureau FTEs.

31. Under section 9 of the Act, the Commission must add, delete, or reclassify services in the fee schedule to reflect additions, deletions, or changes in the nature of its services “as a consequence of Commission rulemaking proceedings or changes in law.” 114 As explained above, after analyzing the oversight and regulation of MVPDs (including DBS) by the Media Bureau in various rulemaking proceedings, MVPDs (including DBS providers) are subject to increased regulation and oversight due to changes in law, and therefore DBS should be included in the same fee category as cable television and IPTV, as a permitted amendment. Since two different sets of FTE resources are involved, the Commission is assessing two separate fees on DBS providers, a satellite fee based on International Bureau FTEs and a fee based on Media Bureau FTEs, assessed per DBS subscriber. This adoption of a fee subcategory for DBS within the cable television and IPTV category is a permitted amendment as defined in section 9(b)(3) of the Act, which, pursuant to section 9(b)(4)(B), must be submitted to Congress at least 90 days before it becomes effective.115

32. In the Order portion of the rulemaking, the Commission makes ministerial changes to sections 1.911(d), 1.1912(b)(1), and 1.1917(c) of the Commission's rules 116 to conform to the Digital Accountability and Transparency Act (DATA Act).117 In particular, the Commission amends the rule provisions to specify that debts owed to the Commission that have been delinquent for a period of 120 days shall be transferred to the Secretary of the Treasury.118 These amendments are to conform the Commission's rules to the DATA Act and the notice and comment and effective date provisions of the Administrative Procedure Act are inapplicable.119

1. As required by the Regulatory Flexibility Act of 1980, as amended (RFA),120 an Initial Regulatory Flexibility Analysis (IRFA) was included in the Report and Order and Further Notice of Proposed Rulemaking.121 The Commission sought written public comment on these proposals including comment on the IRFA. This Final Regulatory Flexibility Analysis (FRFA) conforms to the IRFA.122

2. In this Report and Order, we eliminate two categories from the regulatory fee schedule: Amateur radio Vanity Call Signs and General Mobile Radio Service (GMRS). We also include direct broadcast satellite (DBS) providers in the cable television and IPTV regulatory fee category, as a subcategory. To aid in the implementation of new regulatory fees for Responsible Organizations (RespOrgs) adopted in the fiscal year 2014 proceeding, we direct the Managing Director to coordinate with SMS/800, Inc. to ensure that all RespOrgs owing regulatory fees have sufficient information about this process and opportunity to pay the regulatory fee before the RespOrg is placed in red light status and enforcement procedures are initiated.

3. Our regulatory fee for DBS providers, adopted herein, will include DBS providers in the category of cable television operators and IPTV providers, but at a lower regulatory fee rate. This rule was adopted because the Media Bureau staff spend approximately as much time working on issues that include DBS as cable television and IPTV. For the most part, the rules and policies addressed by the Media Bureau include DBS and cable television, as well as IPTV. Under section 9 of the Commission's rules, the DBS industry should contribute to these regulatory fees, otherwise the cable television and IPTV industries are paying for costs that should be shared with DBS.

4. None.

5. The RFA directs agencies to provide a description of, and where feasible, an estimate of the number of small entities that may be affected by the proposed rules and policies, if adopted.123 The RFA generally defines the term “small entity” as having the same meaning as the terms “small business,” “small organization,” and “small governmental jurisdiction.” 124 In addition, the term “small business” has the same meaning as the term “small business concern” under the Small Business Act.125 A “small business concern” is one which: (1) Is independently owned and operated; (2) is not dominant in its field of operation; and (3) satisfies any additional criteria established by the SBA.126 Nationwide, there are a total of approximately 27.9 million small businesses, according to the SBA.127

6. Wired Telecommunications Carriers. The U.S. Census Bureau defines this industry as “establishments primarily engaged in operating and/or providing access to transmission facilities and infrastructure that they own and/or lease for the transmission of voice, data, text, sound, and video using wired communications networks. Transmission facilities may be based on a single technology or a combination of technologies. Establishments in this industry use the wired telecommunications network facilities that they operate to provide a variety of services, such as wired telephony services, including VoIP services, wired (cable) audio and video programming distribution, and wired broadband internet services. By exception, establishments providing satellite television distribution services using facilities and infrastructure that they operate are included in this industry.” 128 The SBA has developed a small business size standard for Wired Telecommunications Carriers, which consists of all such companies having 1,500 or fewer employees.129 Census data for 2007 shows that there were 3,188 firms that operated that year. Of this total, 3,144 operated with less than 1,000 employees.130 Thus, under this size standard, the majority of firms in this industry can be considered small.

7. Local Exchange Carriers (LECs). Neither the Commission nor the SBA has developed a size standard for small businesses specifically applicable to local exchange services. The closest applicable NAICS Code category is Wired Telecommunications Carriers as defined in paragraph 6 of this FRFA. Under the applicable SBA size standard, such a business is small if it has 1,500 or fewer employees.131 According to Commission data, census data for 2007 shows that there were 3,188 firms that operated that year. Of this total, 3,144 operated with fewer than 1,000 employees.132 The Commission therefore estimates that most providers of local exchange carrier service are small entities that may be affected by the rules adopted.

8. Incumbent LECs. Neither the Commission nor the SBA has developed a small business size standard specifically for incumbent local exchange services. The closest applicable NAICS Code category is Wired Telecommunications Carriers as defined in paragraph 6 of this FRFA. Under that size standard, such a business is small if it has 1,500 or fewer employees.133 According to Commission data, 3,188 firms operated in that year. Of this total, 3,144 operated with fewer than 1,000 employees.134 Consequently, the Commission estimates that most providers of incumbent local exchange service are small businesses that may be affected by the rules and policies adopted. Three hundred and seven (307) Incumbent Local Exchange Carriers reported that they were incumbent local exchange service providers.135 Of this total, an estimated 1,006 have 1,500 or fewer employees.136

9. Competitive Local Exchange Carriers (Competitive LECs), Competitive Access Providers (CAPs), Shared-Tenant Service Providers, and Other Local Service Providers. Neither the Commission nor the SBA has developed a small business size standard specifically for these service providers. The appropriate NAICS Code category is Wired Telecommunications Carriers, as defined in paragraph 6 of this FRFA. Under that size standard, such a business is small if it has 1,500 or fewer employees.137 U.S. Census data for 2007 indicate that 3,188 firms operated during that year. Of that number, 3,144 operated with fewer than 1,000 employees.138 Based on this data, the Commission concludes that the majority of Competitive LECS, CAPs, Shared-Tenant Service Providers, and Other Local Service Providers, are small entities. According to Commission data, 1,442 carriers reported that they were engaged in the provision of either competitive local exchange services or competitive access provider services.139 Of these 1,442 carriers, an estimated 1,256 have 1,500 or fewer employees.140 In addition, 17 carriers have reported that they are Shared-Tenant Service Providers, and all 17 are estimated to have 1,500 or fewer employees.141 Also, 72 carriers have reported that they are Other Local Service Providers.142 Of this total, 70 have 1,500 or fewer employees.143 Consequently, based on internally researched FCC data, the Commission estimates that most providers of competitive local exchange service, competitive access providers, Shared-Tenant Service Providers, and Other Local Service Providers are small entities that may be affected by the rules adopted.

10. Interexchange Carriers (IXCs). Neither the Commission nor the SBA has developed a definition for Interexchange Carriers. The closest NAICS Code category is Wired Telecommunications Carriers as defined in paragraph 6 of this FRFA. The applicable size standard under SBA rules is that such a business is small if it has 1,500 or fewer employees.144 U.S. Census data for 2007 indicates that 3,188 firms operated during that year. Of that number, 3,144 operated with fewer than 1,000 employees.145 According to internally developed Commission data, 359 companies reported that their primary telecommunications service activity was the provision of interexchange services.146 Of this total, an estimated 317 have 1,500 or fewer employees.147 Consequently, the Commission estimates that the majority of interexchange service providers are small entities that may be affected by the rules adopted.

11. Prepaid Calling Card Providers. Neither the Commission nor the SBA has developed a small business size standard specifically for prepaid calling card providers. The appropriate NAICS Code category for prepaid calling card providers is Telecommunications Resellers. This industry comprises establishments engaged in purchasing access and network capacity from owners and operators of telecommunications networks and reselling wired and wireless telecommunications services (except satellite) to businesses and households. Mobile virtual networks operators (MVNOs) are included in this industry.148 Under the applicable SBA size standard, such a business is small if it has 1,500 or fewer employees.149 U.S. Census data for 2007 show that 1,523 firms provided resale services during that year. Of that number, 1,522 operated with fewer than 1,000 employees.150 Thus, under this category and the associated small business size standard, the majority of these prepaid calling card providers can be considered small entities. According to Commission data, 193 carriers have reported that they are engaged in the provision of prepaid calling cards.151 All 193 carriers have 1,500 or fewer employees.152 Consequently, the Commission estimates that the majority of prepaid calling card providers are small entities that may be affected by the rules adopted.

12. Local Resellers. The SBA has developed a small business size standard for the category of Telecommunications Resellers. Under that size standard, such a business is small if it has 1,500 or fewer employees.153 Census data for 2007 show that 1,523 firms provided resale services during that year. Of that number, 1,522 operated with fewer than 1,000 employees.154 Under this category and the associated small business size standard, the majority of these local resellers can be considered small entities. According to Commission data, 213 carriers have reported that they are engaged in the provision of local resale services.155 Of this total, an estimated 211 have 1,500 or fewer employees.156 Consequently, the Commission estimates that the majority of local resellers are small entities that may be affected by the rules adopted.

13. Toll Resellers. The Commission has not developed a definition for Toll Resellers. The closest NAICS Code Category is Telecommunications Resellers, and the SBA has developed a small business size standard for the category of Telecommunications Resellers. Under that size standard, such a business is small if it has 1,500 or fewer employees.157 Census data for 2007 show that 1,523 firms provided resale services during that year. Of that number, 1,522 operated with fewer than 1,000 employees.158 Thus, under this category and the associated small business size standard, the majority of these resellers can be considered small entities. According to Commission data, 881 carriers have reported that they are engaged in the provision of toll resale services.159 Of this total, an estimated 857 have 1,500 or fewer employees.160 Consequently, the Commission estimates that the majority of toll resellers are small entities that may be affected by the rules adopted.

14. Other Toll Carriers. Neither the Commission nor the SBA has developed a definition for small businesses specifically applicable to Other Toll Carriers. This category includes toll carriers that do not fall within the categories of interexchange carriers, operator service providers, prepaid calling card providers, satellite service carriers, or toll resellers. The closest applicable NAICS Code category is for Wired Telecommunications Carriers as defined in paragraph 6 of this FRFA. Under the applicable SBA size standard, such a business is small if it has 1,500 or fewer employees.161 Census data for 2007 shows that there were 3,188 firms that operated that year. Of this total, 3,144 operated with fewer than 1,000 employees.162 Thus, under this category and the associated small business size standard, the majority of Other Toll Carriers can be considered small. According to internally developed Commission data, 284 companies reported that their primary telecommunications service activity was the provision of other toll carriage.163 Of these, an estimated 279 have 1,500 or fewer employees.164 Consequently, the Commission estimates that most Other Toll Carriers are small entities that may be affected by the rules and policies adopted.

15. Wireless Telecommunications Carriers (except Satellite). This industry comprises establishments engaged in operating and maintaining switching and transmission facilities to provide communications via the airwaves, such as cellular services, paging services, wireless internet access, and wireless video services.165 The appropriate size standard under SBA rules is that such a business is small if it has 1,500 or fewer employees. For this industry, Census data for 2007 show that there were 1,383 firms that operated for the entire year. Of this total, 1,368 firms had fewer than 1,000 employees. Thus under this category and the associated size standard, the Commission estimates that the majority of wireless telecommunications carriers (except satellite) are small entities. Similarly, according to internally developed Commission data, 413 carriers reported that they were engaged in the provision of wireless telephony, including cellular service, Personal Communications Service (PCS), and Specialized Mobile Radio (SMR) services.166 Of this total, an estimated 261 have 1,500 or fewer employees.167 Consequently, the Commission estimates that approximately half of these firms can be considered small. Thus, using available data, we estimate that the majority of wireless firms can be considered small.

16. Cable Television and Other Subscription Programming.168 Since 2007, these services have been defined within the broad economic census category of Wired Telecommunications Carriers. That category is defined as follows: “This industry comprises establishments primarily engaged in operating and/or providing access to transmission facilities and infrastructure that they own and/or lease for the transmission of voice, data, text, sound, and video using wired telecommunications networks. Transmission facilities may be based on a single technology or a combination of technologies.” 169 The SBA has developed a small business size standard for this category, which is: all such firms having 1,500 or fewer employees.170 Census data for 2007 shows that there were 3,188 firms that operated that year. Of this total, 3,144 had fewer than 1,000 employees.171 Thus under this size standard, the majority of firms offering cable and other program distribution services can be considered small and may be affected by rules adopted.

17. Cable Companies and Systems. The Commission has developed its own small business size standards, for the purpose of cable rate regulation. Under the Commission's rules, a “small cable company” is one serving 400,000 or fewer subscribers, nationwide.172 Industry data indicate that at the end of June 2012, 1,141 cable companies were in operation.173 Of this total, all but ten cable operators were small under this size standard. In addition, under the Commission's rules, a “small system” is a cable system serving 15,000 or fewer subscribers.174 Industry data indicate that of 4,945 systems nationwide, 4,380 systems have fewer than 20,000.175 Thus, under this second size standard, most cable systems are small and may be affected by the rules adopted.

18. All Other Telecommunications. “All Other Telecommunications” is defined as follows: This U.S. industry is comprised of establishments that are primarily engaged in providing specialized telecommunications services, such as satellite tracking, communications telemetry, and radar station operation. This industry also includes establishments primarily engaged in providing satellite terminal stations and associated facilities connected with one or more terrestrial systems and capable of transmitting telecommunications to, and receiving telecommunications from, satellite systems. Establishments providing Internet services or voice over Internet protocol (VoIP) services via client-supplied telecommunications connections are also included in this industry.176 The SBA has developed a small business size standard for “All Other Telecommunications,” which consists of all such firms with gross annual receipts of $32.5 million or less.177 For this category, census data for 2007 show that there were 2,383 firms that operated for the entire year. Of these firms, a total of 2,346 had gross annual receipts of less than $25 million.178 Thus, a majority of “All Other Telecommunications” firms potentially affected by the rules adopted can be considered small.

19. This Report and Order does not adopt any new reporting, recordkeeping, or other compliance requirements, other than the requirement that DBS providers pay regulatory fees based on Media Bureau FTEs, as a subcategory of the cable television operators and IPTV category. These two companies are already subject to our regulatory fee requirements.

20. The RFA requires an agency to describe any significant alternatives that it has considered in reaching its approach, which may include the following four alternatives, among others: (1) The establishment of differing compliance or reporting requirements or timetables that take into account the resources available to small entities; (2) the clarification, consolidation, or simplification of compliance or reporting requirements under the rule for small entities; (3) the use of performance, rather than design, standards; and (4) an exemption from coverage of the rule, or any part thereof, for small entities.179

21. This Report and Order does not adopt any new reporting requirements. Therefore no adverse economic impact on small entities will be sustained based on reporting requirements. There will be a regulatory fee increase on DBS providers, but these companies are not small entities. We are also advising SMS/800, Inc. to provide information to Responsible Organizations, or RespOrgs, to ensure that they comply with their new previously adopted regulatory fee requirements. These entities may be small entities; however, the regulatory fee per toll free number is very small and could easily be paid and then passed on to the subscriber if the number is in use, in which case compliance would not be an issue. (We also note that there is a previously adopted de minimis threshold of $500, per year.) If the toll free number is not used by a subscriber, the RespOrg can either choose to pay the regulatory fee or return the toll free number to the 800/SMS, Inc. database. The Commission expends resources to address toll free issues, and so parties should either be responsible for the payment of the resources used or the toll free numbers should be returned for others to use.

22. In keeping with the requirements of the Regulatory Flexibility Act, we have considered certain alternative means of mitigating the effects of fee increases to a particular industry segment. In addition, the Commission's rules provide a process by which regulatory fee payors may seek waivers or other relief on the basis of financial hardship. See 47 CFR 1.1166.

23. None.

24. Accordingly, it is ordered that, pursuant to Sections 4(i) and (j), 9, and 303(r) of the Communications Act of 1934, as amended, 47 U.S.C. 154(i), 154(j), 159, and 303(r), this Report and Order and Order is hereby adopted.

25. It is further ordered that Part 1 of the Commission's rules are amended as set forth in paragraph 32 and in the rule change section of this document, effective upon publication in the Federal Register.

26. It is further ordered that the Commission's Consumer and Governmental Affairs Bureau, Reference Information Center, shall send a copy of this Report and Order and Order, including the Final Regulatory Flexibility Analysis, to the Chief Counsel for Advocacy of the U.S. Small Business Administration.

For the reasons discussed in the preamble, the Federal Communications Commission amends 47 CFR part 1 as follows:

NASA published a final rule in the Federal Register on March 12, 2015, inadvertently removing from the Code of Federal Regulations (CFR) those sections of the NASA FAR Supplement that contained information related to access and release of sensitive information while performing contracted advisory and assistance contracts. As published, the rule contains errors due to inadvertent deletion of text that needs to be corrected. Specifically, in amendatory instruction 49 on page 12944 of that final rule, NFS sections 1837.203-70, 1837.203-71, and 1837.203-72 were erroneously deleted and need to be restored. In addition, in amendatory instruction 94 on page 12953 of the final rule, the associated clauses at NFS 1852.237-72 and 1852.237-73 were also removed in error and need to be restored. NASA is not altering these policies and regulations, but rather, correcting an inadvertent deletion. This document corrects the final rule by revising these sections.

Accordingly, 48 CFR parts 1837 and 1852 are amended as follows:

Snowy grouper is in the snapper-grouper fishery of the South Atlantic and is managed under the FMP. The FMP was prepared by the Council and is implemented through regulations at 50 CFR part 622 under the authority of the Magnuson-Stevens Fishery Conservation and Management Act (Magnuson-Stevens Act).

On April 8, 2015, NMFS published a proposed rule for Regulatory Amendment 20 and requested public comment (80 FR 18797). The proposed rule and Regulatory Amendment 20 outline the rationale for the actions contained in this final rule. A summary of the actions implemented by Regulatory Amendment 20 and this final rule is provided below.

This final rule revises the snowy grouper ACLs for both the commercial and recreational sectors, the commercial trip limits, and the recreational fishing season. All weights described in the preamble of this final rule are in gutted weight.

In 2013, a standard stock assessment for snowy grouper was conducted using the Southeast Data, Assessment, and Review (SEDAR) process (SEDAR 36). SEDAR 36 indicates that the snowy grouper stock is no longer undergoing overfishing, remains overfished, and is rebuilding.

This final rule increases the ACLs for snowy grouper based on the acceptable biological catch (ABC) chosen by the Council, as recommended by their Scientific and Statistical Committee (SSC) based on the results of SEDAR 36. The current snowy grouper commercial ACL is 82,900 lb (37,603 kg). This final rule revises the commercial ACL to 115,451 lb (52,368 kg) in 2015; 125,760 lb (57,044 kg) in 2016; 135,380 lb (61,407 kg) in 2017; 144,315 lb (65,460 kg) in 2018; and 153,935 lb (69,824 kg) in 2019, and subsequent fishing years. The current snowy grouper recreational ACL is 523 fish. This final rule revises the snowy grouper recreational ACL to 4,152 fish in 2015; 4,483 fish in 2016; 4,819 fish in 2017, 4,983 fish in 2018; and 5,315 fish in 2019, and subsequent fishing years.

Applying the existing allocation formula for snowy grouper to the change in landings from the SEDAR 36 assessment resulted in a shift in the sector ACLs from 95 percent commercial and 5 percent recreational to 83 percent commercial and 17 percent recreational.

This final rule revises the snowy grouper commercial trip limit from the current 100 lb (45 kg) to 200 lb (91 kg). The Council determined that since the commercial ACL would be increasing yearly from 2015 to 2019, a relatively small increase in the commercial trip limit to 200 lb (91 kg) would help to maintain a longer fishing season when combined with the commercial ACL increase. Furthermore, because the fishing year for snowy grouper begins on January 1, an increased trip limit could enhance profits for commercial snapper-grouper fishermen during the winter. This is because shallow-water grouper species are closed during January-April, leaving snowy grouper (a deep-water species) as one of few options for purchase by dealers at that time.

The current snowy grouper fishing season is year-round with a recreational bag limit of one snowy grouper per vessel per day. This final rule revises the recreational fishing season to one snowy grouper per vessel per day from May through August, with no retention of snowy grouper during the rest of the year. The Council determined that reducing the current year-round recreational fishing season to a 4-month season would help minimize the risk of exceeding the recreational ACL. Additionally, the fishing season dates and bag limit for the snowy grouper recreational sector would match those for a co-occurring species, blueline tilefish. The Council determined that similar recreational management measures and fishing seasons for snowy grouper and blueline tilefish would be beneficial to both fish stocks as they are caught at the same depths and have similar high release mortality rates; thereby, discards of both species could be reduced.

A total of 24 comments were received on Regulatory Amendment 20 and the proposed rule from individuals, commercial fishing associations, fish markets, and a Federal agency. The Federal agency stated that it had no comment on the proposed rule or Regulatory Amendment 20. The comments that oppose one or more of the management measures in Regulatory Amendment 20 and the proposed rule are summarized and responded to below.

Comment 1: NMFS should not increase the commercial or recreational catch limits for snowy grouper.

Response: NMFS disagrees. In 2013, a standard stock assessment for snowy grouper was conducted through SEDAR 36. SEDAR 36 indicates the snowy grouper stock is no longer undergoing overfishing, remains overfished, and is rebuilding. The previous assessment conducted in 2004 (SEDAR 4) determined snowy grouper was undergoing overfishing and was overfished. The Council's SSC recommended an increase in the ABC to the Council; and the Council then chose a corresponding increase in the commercial and recreational ACLs. The ACLs for the commercial and recreational sectors chosen by the Council and implemented through this final rule are based on the best scientific information available, and are appropriate to maintain a sustainable harvest of the stock, while it continues to rebuild. Thus, catch levels for snowy grouper may now be increased without negatively impacting the stock.

Comment 2: NMFS should not increase the commercial quota while shortening the recreational fishing season.

Response: NMFS disagrees. This final rule for Regulatory Amendment 20 will increase both the commercial and recreational ACLs for snowy grouper based upon the results of the latest stock assessment (SEDAR 36). The ACLs may be increased for the commercial and recreational sectors because the stock is no longer undergoing overfishing, and is rebuilding at a rate that allows the ABC increase recommended by the SSC and the ACL chosen by the Council. Further, changing the recreational fishing season to May through August is expected to reduce the chance that the recreational ACL is exceeded, promote safety at sea for recreational fishermen, and reduce bycatch of snowy grouper.

The current recreational fishing season begins on January 1. Recreational landings for snowy grouper exceeded the recreational ACL by approximately 400 percent in both 2012 and 2013, and 230 percent in 2014, and as a result of the accountability measures (AMs), the recreational sector closed on May 31, in 2013, and on June 7, in 2014. Without a change to the recreational fishing season and with an increased ACL, it is expected that the recreational ACL would still be reached and harvest closed early in the year. Continuing to exceed the ACL could negatively impact the rebuilding of the snowy grouper stock, and the Council determined that changing the fishing season would help minimize the risk of exceeding the recreational ACL.

Additionally, in some areas of the South Atlantic, recreational fishermen must travel long distances offshore to fish for snowy grouper, where conditions can be more challenging for fishermen during times of the year when weather is poor. The months of May through August are when recreational fishermen throughout the South Atlantic generally have more equal access to the resource due to good weather conditions, and would thus benefit the most from the increase in the recreational ACL.

The fishing season dates and bag limit for the snowy grouper recreational sector specified in Regulatory Amendment 20 match those implemented in Amendment 32 to the FMP for blueline tilefish, a co-occurring species with snowy grouper, (80 FR 16583; March 30, 2015). Therefore, this approach could help reduce discard mortality for snowy grouper, which can be targeted along with blueline tilefish. The Council determined that similar recreational management measures and fishing seasons for snowy grouper and blueline tilefish would be beneficial to both fish stocks and reduce bycatch as they are caught at the same depths and have similar high release mortality rates.

Comment 3: NMFS should not start the commercial fishing season on January 1. Inclement weather in North Carolina in the earlier part of the year does not allow equitable access to snowy grouper, which does not conform to National Standard (NS) 4 of the Magnuson-Stevens Act. NMFS should start the commercial fishing season later in the year, and implement split seasons for the commercial sector.

Response: NMFS disagrees that the commercial trip limit action violates NS 4, as the trip limit does not discriminate between residents of different states. The Council did not consider changing the start date of the commercial fishing year from January 1 in Regulatory Amendment 20, but they did consider creating split commercial seasons within the fishing year. The Council acknowledged that fishers in North Carolina have historically had limited access to snowy grouper at the beginning of the fishing year as a result of weather conditions compared to other areas within the Council's jurisdiction. However, snowy grouper are an important commercial species during January to April when the harvest of shallow-water grouper is closed, and snowy grouper sells at a higher market price during that part of the year. The Council determined that the current commercial fishing year allows for enhanced profits per trip and likely enhanced total profits for commercial snapper-grouper fishers. Additionally, if snowy grouper closes in the summer as a result of meeting its commercial quota, there are many other snapper-grouper species open to commercial harvest beginning on May 1. While weather conditions throughout the Council's area of jurisdiction may be variable throughout the year and may not impact certain areas or states in the South Atlantic at the same time in the same way, the snowy grouper fishing season dates are applied the same to all the states. Over the course of an entire fishing season, it is likely that there are comparable opportunities for individuals throughout the South Atlantic with respect to commercial harvest of snowy grouper.

While the Council did consider split seasons for the commercial sector in Regulatory Amendment 20, they determined it would have little effect on extending the fishing season when compared with the Council's preferred alternative. Due to the increase to the commercial ACL in Regulatory Amendment 20, the first split season would likely remain open because the first split season quota would not be met under any of the new trip limit alternatives considered by the Council. Thus, the split season alternative would have the same effect as the preferred alternative of implementing a 200 lb (91 kg) trip limit with no split season, because both choices would result in approximately the same fishing season length.

Therefore, the Council determined that their preferred alternative for this action best met the purpose and need to implement measures expected to prevent overfishing and achieve OY while also complying with the requirements of the Magnuson-Stevens Act and other applicable laws, including NS 4.

Comment 4: NMFS should increase the commercial trip limit to 300 lb (136 kg), not the proposed trip limit increase to 200 lb (91 kg).

Response: NMFS disagrees. The Council considered a trip limit of 300 lb (136 kg), and determined that since the commercial ACL would be increasing yearly from 2015 to 2019, a small increase in the commercial trip limit from 100 lb (45 kg) to 200 lb (91 kg), would help to maintain a longer fishing season when combined with the commercial ACL increase. Analysis in Regulatory Amendment 20 revealed that commercial landings could increase over 100 percent throughout the calendar year with an increase in the commercial trip limit to 300 lb (136 kg). This would result in the commercial ACL being met and harvest closure occurring earlier in the year than for the 200 lb (91 kg) trip limit.

Comment 5: NMFS should not reallocate the increase in commercial and recreational ACLs using unreliable Marine Recreational Fisheries Statistics Survey (MRFSS)/Marine Recreational Information Program (MRIP) data.

Response: The Council is applying their approved existing sector allocation formula for snowy grouper to the updated MRIP landings from SEDAR 36 to specify sector ACLs. The existing sector allocation formula developed and approved in Amendment 15B to the FMP, uses average commercial and recreational landings from 1986-2005 (74 FR 58902, November 16, 2009). SEDAR 36 also included recreational data from Monroe County, Florida, that were not available when snowy grouper was first assessed in 2004 (SEDAR 4) because the recreational landings for Monroe County could not be separated from other west Florida landings. In 2013, a method was developed to separate Monroe County data from other west Florida landings. The change in landings from the SEDAR 36 assessment, as applied to the average commercial and recreational landings for 1986-2005, resulted in a shift in the sector ACLs from the current 95 percent commercial and 5 percent recreational to 83 percent commercial and 17 percent recreational. Additionally, the SEDAR 36 assessment made adjustments to the landings to account for the change from MRFSS to MRIP, and NMFS has determined that this information is the best scientific information available.

Comment 6: The Council's preferred alternative of a 1 fish per vessel per day recreational bag limit with harvest allowed only during the months of May through August will result in North Carolina recreational fishers being geographically disadvantaged. Furthermore, lack of compatible regulations in Florida state waters is not only unfair to North Carolina fishers since North Carolina implements compatible regulations in its state waters, but is potentially detrimental to the snowy grouper population, which is still considered overfished and is under a rebuilding plan.

Response: NMFS disagrees that the Council's choice of the recreational fishing season would result in a geographic disadvantage in accessing the snowy grouper resource by North Carolina fishers. The Council determined that the months of May through August are when recreational fishermen throughout the South Atlantic usually have equal access to the resource as a result of generally improved weather conditions.

NMFS agrees that the lack of consistency in compatible regulations in state waters could have detrimental effects upon the stock as it rebuilds, since the implementation of compatible state regulations can allow for fishery resources to be more effectively conserved. However, based on the most recent stock assessment, the ACLs may be increased for the commercial and recreational sectors because the stock is no longer undergoing overfishing and is rebuilding at a rate that allows the ABC increase recommended by the SSC and the ACL chosen by the Council.

Comment 7: NMFS should not allow snowy grouper to be harvested during the snowy grouper spawning season of April to September.

Response: The Council recognized that spawning for snowy grouper occurs during April to September but determined that reducing the current year-round recreational fishing season to a 4-month season from May through August should reduce the chance that the ACL is exceeded, promote safety at sea, and reduce the bycatch of snowy grouper, as discussed in the response to Comment 2 above. In the commercial sector, the snowy grouper AMs that are in place and the monitoring program to evaluate commercial landings are expected to constrain commercial landings from exceeding the commercial ACL. Therefore, the harvest of snowy grouper that may occur during the spawning season is not expected to result in the ACLs being exceeded and is not expected to negatively impact the stock.

The Regional Administrator, Southeast Region, NMFS has determined that this final rule is necessary for the conservation and management of South Atlantic snapper-grouper and is consistent with Regulatory Amendment 20, the FMP, the Magnuson-Stevens Act, and other applicable law.

This final rule has been determined to be not significant for purposes of Executive Order 12866.

The Magnuson-Stevens Act provides the statutory basis for this rule. No duplicative, overlapping, or conflicting Federal rules have been identified. In addition, no new reporting, record-keeping, or other compliance requirements are introduced by this final rule.

In compliance with section 604 of the RFA, NMFS prepared a Final Regulatory Flexibility Analysis (FRFA) for this final rule. The FRFA uses updated information, when available, and analyzes the anticipated economic impacts of the final actions and any significant economic impacts on small entities. The FRFA incorporates the IRFA, a summary of the significant economic issues raised by public comment, NMFS' responses to those comments, and a summary of the analyses completed to support the action. The FRFA follows.

No public comments specific to the IRFA were received and, therefore, no public comments are addressed in this FRFA. Certain comments with socio-economic implications are addressed in the comments and responses section, specifically, the response to comments 2, 3, and 6. No changes in the final rule were made in response to public comments.

NMFS agrees that the Council's choice of preferred alternatives would best achieve the Council's objectives for Regulatory Amendment 20 to the FMP while minimizing, to the extent practicable, the adverse effects on fishers, support industries, and associated communities. The preamble to this final rule provides a statement of the need for and objectives of this rule.

NMFS expects this rule to directly affect federally permitted commercial fishers who harvest snowy grouper in the South Atlantic. The Small Business Administration established size criteria for all major industry sectors in the U.S., including fish harvesters and for-hire operations. A business involved in fish harvesting is classified as a small business if it is independently owned and operated, is not dominant in its field of operation (including its affiliates), and its combined annual receipts are not in excess of $20.5 million (NAICS code 114111, finfish fishing) for all of its affiliated operations worldwide.

Charter vessels and headboats (for-hire vessels) sell fishing services, which include the harvest of any species considered in this proposed rule, to recreational anglers. These vessels provide a platform for the opportunity to fish and not a guarantee to catch or harvest any species, though expectations of successful fishing, however defined, likely factor into the decision to purchase these services. Changing the allowable harvest of a species, including a fishery closure, only defines what species may be kept and does not explicitly prevent the continued offer of for-hire fishing services. In response to a change in the allowable harvest of a species, including a zero-fish recreational bag limit, fishing for other species could continue. Because the changes to management measures for species implemented in this final rule will not directly alter the services sold by these vessels, this final rule does not directly apply to or regulate their operations. For-hire vessels will continue to be able to offer their primary product, which is an attempt to “put anglers on fish,” provide the opportunity for anglers to catch whatever their skills enable them to catch, and keep those fish that they desire to keep and are legal to keep. Any changes in demand for these fishing services, and associated economic affects as a result of changing an ACL or establishing fishery closures, would be a consequence of behavioral change by anglers, secondary to any direct effect on anglers, and, therefore, an indirect effect of the proposed regulatory action. Because the effects on for-hire vessels are indirect, they fall outside the scope of the Regulatory Flexibility Analysis (RFA). Recreational anglers, who may be directly affected by the changes in this final rule, are not small entities under the RFA.

NMFS has not identified any other small entities that will be directly affected by this final rule.

The snapper-grouper fishery is a multi-species fishery and vessels generally land many species on the same trip. From 2009 through 2013, an annual average of 138 vessels with valid Federal permits to operate in the commercial sector of the snapper-grouper fishery landed at least 1 lb (0.45 kg) of snowy grouper. Each vessel generated annual average dockside revenues of approximately $78,000 (2013 dollars), of which $2,000 were from snowy grouper, $21,000 from other species jointly landed with snowy grouper, and $55,000 from other species on trips without snowy grouper. Vessels that caught and landed snowy grouper may also operate in other fisheries outside the snapper-grouper fishery, the revenues of which are not known and are not reflected in these totals. Based on revenue information, all commercial vessels directly affected by the final rule may be considered small entities.

Because all entities expected to be affected by this rule are small entities, NMFS has determined that this final rule would affect a substantial number of small entities. Moreover, the issue of disproportionate effects on small versus large entities does not arise in the present case.

The effect of the action to modify the rebuilding strategy for snowy grouper is to adopt the ABC chosen by the Council, as recommended by their SSC based upon the recent stock assessment. Modifying the rebuilding strategy for snowy grouper will have no direct economic effects on small entities, because it will not alter the current use or access to the snowy grouper resource. NMFS notes that the ABC resulting from the modification of the rebuilding strategy will be higher than the status quo ABC for snowy grouper.

Setting the snowy grouper ACL equal to ABC implies that the ACL will increase as a result of the ABC increase. The method for allocating the ACL between the commercial and recreational sectors will remain the same. The change in the commercial and recreational percentage allocation results from the use of the updated landings of snowy grouper from SEDAR 36. Relative to the 2014 ACL, the commercial ACLs will increase by 39 percent in 2015 and continue to increase annually through 2019 to a point where the commercial ACL in 2019 will be 86 percent greater than it was in 2014. Compared to the 2014 ACL, the recreational ACL will increase by 442 percent in 2015 and continue to increase annually through 2019 to a point where the ACL in 2019 will be 623 percent greater than it was in 2014. In principle, the increases in the snowy grouper sector ACLs are expected to result in revenue and profit increases to commercial vessels. The actual results will partly depend on the relationship to the changes in management measures affecting the commercial sector, as discussed below. As noted, for-hire vessels will only be indirectly affected by this action.

Increasing the snowy grouper commercial trip limit from 100 lb (45 kg), to 200 lb (91 kg), will tend to increase the profit per trip of commercial vessels. This higher trip limit will complement the commercial ACL increase in potentially increasing the annual profits of commercial vessels. Given the ACL increase, the commercial fishing season is expected to extend from January 1 through July 19 under the higher trip limit, or January 1 through December 26 under the status quo (No Action) trip limit. Therefore, the commercial trip limit increase will result in a higher profit per trip but a shorter commercial fishing season; whereas the status quo trip limit will be associated with lower profit per trip but a longer fishing season. Which of these two scenarios will result in higher annual profit for commercial vessels cannot be ascertained. What is less uncertain, however, is that the commercial ACL increase will result in higher annual revenues and profits. As noted, the commercial fishing season is projected to last until July 19 under the revised trip limit and ACL increases. Without the ACL increase, the commercial fishing season is projected to last until June 6 under the trip limit increase. Thus, the commercial ACL increase will allow for about 6 extra weeks of commercial fishing for snowy grouper under the revised trip limit increase. Given a longer fishing season and higher profit per trip, revenues and profits of commercial vessels that target snowy grouper are likely to increase.

The following discussion analyzes the alternatives that were not selected as preferred by the Council. Only actions that would have direct economic effects on small entities merit inclusion in the following discussion.

Three alternatives, including the preferred alternative (as described in the preamble), were considered for adjusting the ACLs. The first alternative, the no action alternative, would maintain the current (lower) commercial and recreational ACLs. This alternative would maintain the same economic benefits for commercial vessels but at levels lower than those afforded by the preferred alternative. The second alternative, which has three sub-alternatives, would set ACLs as some percentage of the ABC. The three sub-alternatives are setting the ACL at 95 percent, 90 percent, and 85 percent of the ABC. All three sub-alternatives would have lower positive effects on the profits of commercial vessels than the preferred alternative.

Five alternatives, including the preferred alternative (as described in the preamble), were considered for modifying the management measures for the snowy grouper commercial sector. The first alternative, the no action alternative, would maintain the commercial trip limit of 100 lb (45 kg). Compared to the preferred alternative, the no action alternative would have a lower profit per trip but would also leave the commercial fishing season open almost year-round. Which of these two alternatives would result in higher annual vessel profits for commercial vessels cannot be ascertained. NMFS notes that, if the trip limit is maintained at 100 lb (45 kg), commercial vessels may not take full advantage of the revised ACL that would annually increase until at least 2019.

The second alternative would split the snowy grouper commercial ACL into two quotas: 50 percent to the first period (January 1-April 30) and 50 percent to the second period (May 1-December 31). Any remaining commercial quota from the first period would carry over into the second period; any remaining commercial quota from the second period would not carry over into the next fishing year. The following three sub-alternatives on trip limits would apply to each period: 100 lb (45 kg), 150 lb (47.5 kg), or 200 lb (91 kg). Given the commercial ACL increases, commercial harvest in the first period would likely remain open under any of the alternative trip limits because the commercial quota would not be caught, but commercial harvest in the second period would not be open very long with the highest trip limit resulting in the shortest fishing season. This alternative, with the trip limit of 200 lb (91 kg), would have the same effects on commercial vessel profits as the preferred alternative, because both alternatives would have the same trip limits and the same fishing season length. At lower trip limits, this alternative would allow a longer fishing season but also lower profit per trip than the preferred alternative. It cannot be determined if this alternative, with lower trip limits and a longer fishing season, would result in higher annual profits than the preferred alternative. In an effort to address the accessibility to the snowy grouper resource, the Council considered implementing a commercial split season, as in the second alternative, that would essentially spread out effort over time so that various fishers throughout the Council's area of jurisdiction would have access to the snowy grouper resource. The Council decided to retain the current commercial fishing year as the calendar year because snowy grouper are an important commercial species in the early part of the calendar year, when shallow-water groupers are closed to commercial harvest. In addition, snowy grouper earn higher prices during the early months of the year.

The third alternative would split the snowy grouper commercial ACL into two quotas: 40 percent to the first period (January 1-April 30) and 60 percent to the second period (May 1-December 31). Any remaining commercial quota from the first period would carry over into the second period; any remaining commercial quota from the second period would not carry over into the next fishing year. This alternative would maintain the current commercial trip limit of 100 lb (45 kg), for the first period and establish one of the following trip limits for the second period: 100 lb (45 kg), 150 lb (47.5 kg), 200 lb (91 kg), 250 lb (112.5 kg), or 300 lb (135 kg). Under this alternative and given the ACL increases, commercial fishing would likely remain open throughout the first period but would not be open very long in the second period, with the highest trip limit resulting in the shortest fishing season. As with the second alternative, this alternative, when combined with lower trip limits, would provide longer fishing seasons but lower profit per trip than the preferred alternative. Similarly, this alternative, when combined with higher trip limits, would allow for a higher profit per trip but result in shorter fishing seasons. It cannot be determined if this alternative, with either lower or higher trip limits, would result in greater annual profits than the preferred alternative. Similar to the second alternative, the Council considered a split season to address the accessibility to the resource. For similar reasons mentioned above, this third alternative was not selected as the preferred alternative by the Council.

The fourth alternative is similar to the preferred alternative but would establish a trip limit of either 300 lb (135 kg), or 150 lb (47.5 kg). This alternative would result in a longer fishing season but a lower profit per trip under a trip limit of 150 lb (47.5 kg), or a shorter fishing season and a higher profit per trip under a trip limit of 300 lb (135 kg), than the preferred alternative. The differential impacts on the annual profits of commercial vessels between this alternative and the preferred alternative cannot be determined. However, the preferred alternative appears to provide a better balance between season length and profit per trip than this alternative with trip limits of either 150 lb (47.5 kg), or 300 lb (135 kg).

The fifth alternative would modify the snowy grouper commercial trip limit to 150 lb (47.5 kg), year-round or until the commercial ACL is met or projected to be met, except for the period of May through August from Florida's Brevard/Indian River County line northward when the trip limit will be one of the following: 200 lb (91 kg), 250 lb (112.5 kg), or 300 lb (135 kg). This alternative would provide for a lower trip limit than the preferred alternative, except in May through August when an equal or higher trip limit would be allowed in certain areas. This alternative would likely benefit commercial vessels in areas north of Indian River County, Florida, more than vessels in other areas, at least during the period when vessels in the northern areas are allowed higher trip limits. Whether total profits from all vessels would be higher under this alternative than under the preferred alternative cannot be determined. Although this alternative was not chosen as the preferred alternative, the Council acknowledged that fishermen in North Carolina have historically had limited access to snowy grouper at the beginning of the fishing year due to generally poor winter weather conditions. However, some milder winters in recent years have benefitted fishermen through some increased access to snowy grouper.

Section 212 of the Small Business Regulatory Enforcement Fairness Act of 1996 states that, for each rule or group of related rules for which an agency is required to prepare a FRFA, the agency shall publish one or more guides to assist small entities in complying with the rule, and shall designate such publications as small entity compliance guides. As part of the rulemaking process, NMFS prepared a fishery bulletin, which also serves as a small entity compliance guide. The fishery bulletin will be sent to all interested parties.

For the reasons set out in the preamble, 50 CFR part 622 is amended as follows: