| Page Range | 43299-43612 | |
| FR Document |
| Page and Subject | |
|---|---|
| 80 FR 43413 - Sunshine Act Meetings | |
| 80 FR 43299 - Captive Nations Week, 2015 | |
| 80 FR 43424 - Receipt of Test Data Under the Toxic Substances Control Act | |
| 80 FR 43323 - Sedaxane; Pesticide Tolerances | |
| 80 FR 43428 - Notice of Agreements Filed | |
| 80 FR 43428 - Notice of Request for Additional Information; Correction | |
| 80 FR 43407 - Applications for New Awards; Independent Living Services for Older Individuals Who Are Blind-Independent Living Services for Older Individuals Who Are Blind Training and Technical Assistance Program | |
| 80 FR 43400 - Applications for New Awards; American Indian Vocational Rehabilitation Services-Training and Technical Assistance | |
| 80 FR 43459 - Request for Nominations for the Star-Spangled Banner National Historic Trail Advisory Council | |
| 80 FR 43424 - Pesticides; Risk Management Approach To Identifying Options for Protecting the Monarch Butterfly; Notice of Extension of Comment Period | |
| 80 FR 43462 - United States v. Entercom Communications Corp. and Lincoln Financial Media Company; Proposed Final Judgment and Competitive Impact Statement | |
| 80 FR 43456 - South Bay Salt Pond Restoration Project, Phase 2; Don Edwards San Francisco Bay National Wildlife Refuge; Draft Environmental Impact Statement/Environmental Impact Report | |
| 80 FR 43473 - Notice Pursuant to the National Cooperative Research and Production Act of 1993-Wireless Industrial Technology Konsortium, Inc. | |
| 80 FR 43473 - Notice Pursuant to the National Cooperative Research and Production Act of 1993-Interchangeable Virtual Instruments Foundation, Inc. | |
| 80 FR 43462 - Notice Pursuant to the National Cooperative Research and Production Act of 1993-PXI Systems Alliance, Inc. | |
| 80 FR 43456 - Extension of Agency Information Collection Activity Under OMB Review: Security Programs for Foreign Air Carriers | |
| 80 FR 43440 - Obstetrics and Gynecology Devices Panel of the Medical Devices Advisory Committee; Notice of Meeting | |
| 80 FR 43387 - Hydrofluorocarbon Blends and Components Thereof From the People's Republic of China: Initiation of Less-Than-Fair-Value Investigation | |
| 80 FR 43392 - Certain Polyester Staple Fiber From the People's Republic of China: Preliminary Results of the Antidumping Duty Administrative Review; 2013-2014 | |
| 80 FR 43386 - Quarterly Update to Annual Listing of Foreign Government Subsidies on Articles of Cheese Subject to an In-Quota Rate of Duty | |
| 80 FR 43314 - Cuba: Implementing Rescission of State Sponsor of Terrorism Designation | |
| 80 FR 43413 - Freeport LNG Development, L.P.; Application for Blanket Authorization To Export Previously Imported Liquefied Natural Gas on a Short-Term Basis | |
| 80 FR 43528 - Self-Regulatory Organizations; Financial Industry Regulatory Authority, Inc.; Order Approving a Proposed Rule Change, as Modified by Amendment No. 1 Thereto, To Adopt FINRA Rule 2242 (Debt Research Analysts and Debt Research Reports) | |
| 80 FR 43482 - Self-Regulatory Organizations; Financial Industry Regulatory Authority, Inc.; Order Approving a Proposed Rule Change, as Modified by Amendment No. 1 Thereto, To Adopt FINRA Rule 2241 (Research Analysts and Research Reports) in the Consolidated FINRA Rulebook | |
| 80 FR 43336 - Fisheries Off West Coast States; Modifications of the West Coast Commercial Salmon Fisheries; Inseason Actions #14 and #15 | |
| 80 FR 43337 - Fisheries of the Exclusive Economic Zone Off Alaska; Pacific Ocean Perch in the West Yakutat District of the Gulf of Alaska | |
| 80 FR 43386 - Delta-Bienville Resource Advisory Committee | |
| 80 FR 43451 - Notice of Issuance of Final Determination Concerning Storage Infrastructure Solution System | |
| 80 FR 43447 - Meeting on American Indian/Alaska Native Lesbian, Gay, Bisexual, and Transgender Health Issues | |
| 80 FR 43459 - Notice of Realty Action: Application for Conveyance of Federally Owned Mineral Interests in Pima County, Arizona; Correction | |
| 80 FR 43447 - Division of Behavioral Health, Office of Clinical and Preventive Services; Methamphetamine and Suicide Prevention Initiative; Correction | |
| 80 FR 43439 - Commission To Eliminate Child Abuse and Neglect Fatalities; Announcement of Meetings | |
| 80 FR 43551 - Agency Information Collection Activities: Request for Comments for the Renewal of an Information Collection | |
| 80 FR 43414 - Cost Recovery Mechanisms for Modernization of Natural Gas Facilities; Order Denying Request For Clarification | |
| 80 FR 43422 - Notice of Commission Staff Attendance | |
| 80 FR 43421 - Electronic Filing Protocols for Commission Forms; Notice of Meeting of North American Energy Standards Board | |
| 80 FR 43422 - Alexander Wind Farm, LLC; Supplemental Notice That Initial Market-Based Rate Filing Includes Request for Blanket Section 204 Authorization | |
| 80 FR 43419 - Dominion South Carolina Gas, Inc; Notice of Intent To Prepare an Environmental Assessment for the Proposed Columbia to Eastover Project and Request for Comments on Environmental Issues | |
| 80 FR 43476 - Notice of Intent To Grant an Exclusive License | |
| 80 FR 43476 - Notice of Intent To Grant a Partially Exclusive License | |
| 80 FR 43551 - Petition for Exemption; Summary of Petition Received | |
| 80 FR 43480 - New Postal Product | |
| 80 FR 43370 - Periodic Reporting | |
| 80 FR 43557 - Open Meeting of the Federal Advisory Committee on Insurance | |
| 80 FR 43554 - Reports, Forms and Recordkeeping Requirements Agency Information Collection Activity Under OMB Review | |
| 80 FR 43320 - Performance Standards for Ionizing Radiation Emitting Products; Fluoroscopic Equipment; Correction; Confirmation of Effective Date | |
| 80 FR 43476 - Notice of Information Collection | |
| 80 FR 43428 - Privacy Act of 1974; Systems of Records | |
| 80 FR 43354 - Revised Critical Infrastructure Protection Reliability Standards | |
| 80 FR 43421 - Combined Notice of Filings #2 | |
| 80 FR 43423 - Combined Notice of Filings #1 | |
| 80 FR 43421 - Combined Notice of Filings | |
| 80 FR 43425 - Information Collection Being Submitted for Review and Approval to the Office of Management and Budget | |
| 80 FR 43426 - Information Collection Being Reviewed by the Federal Communications Commission | |
| 80 FR 43425 - Information Collection Being Reviewed by the Federal Communications Commission Under Delegated Authority | |
| 80 FR 43553 - Notice of Proposed Buy America Waiver for a Variable Refrigerant Flow HVAC System | |
| 80 FR 43552 - Notice of Proposed Buy America Waiver for Replacement Gondola Components | |
| 80 FR 43479 - Submission for OMB Review; Comments Request | |
| 80 FR 43555 - Agency Information Collection Activities: Information Collection Renewal; Comment Request; FFIEC Cybersecurity Assessment Tool | |
| 80 FR 43439 - General Services Administration Acquisition Regulation; Submission for OMB Review; Identification of Products With Environmental Attributes | |
| 80 FR 43442 - Statement of Organization, Functions and Delegations of Authority | |
| 80 FR 43478 - Submission for OMB Review; Comments Request | |
| 80 FR 43505 - Self-Regulatory Organizations; Municipal Securities Rulemaking Board; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Consisting of an Amendment to MSRB Rule G-45, on Reporting of Information on Municipal Fund Securities | |
| 80 FR 43512 - Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing of Amendment Nos. 1, 2, and 3 and Order Approving on an Accelerated Basis a Proposed Rule Change, as Modified by Amendment Nos. 1, 2, and 3, To List and Trade Shares of the SPDR® SSgA Flexible Allocation ETF Under NYSE Arca Equities Rule 8.600 | |
| 80 FR 43498 - Self-Regulatory Organizations; The Depository Trust Company; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend the DTC Settlement Service Guide To Allow Participants To Elect To Receive Certain New Transactional and Settlement Balance Files and Effect a Related Amendment to the DTC Fee Schedule | |
| 80 FR 43497 - Self-Regulatory Organizations; OneChicago, LLC; Notice of Filing of Proposed Rule Change Relating to Decimal Pricing for Spread Transactions | |
| 80 FR 43515 - Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing of Proposed Rule Change for New Equity Trading Rules Relating to Trading Halts, Short Sales, Limit Up-Limit Down, and Odd Lots and Mixed Lots To Reflect the Implementation of Pillar, the Exchange's New Trading Technology Platform | |
| 80 FR 43500 - Self-Regulatory Organizations; NYSE Arca, Inc.; Order Approving a Proposed Rule Change, as Modified by Amendment No. 1, To List and Trade Shares of the iShares iBonds Dec 2021 AMT-Free Muni Bond ETF and iShares iBonds Dec 2022 AMT-Free Muni Bond ETF Under NYSE Arca Equities Rule 5.2(j)(3) | |
| 80 FR 43480 - Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Amending the NYSE Arca Options Fee Schedule | |
| 80 FR 43509 - Self-Regulatory Organizations; NASDAQ OMX PHLX LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change to Amend Exchange Rule 1080(n), Price Improvement XL (“PIXLSM | |
| 80 FR 43503 - Self-Regulatory Organizations; C2 Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Relating to AIM | |
| 80 FR 43507 - Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Relating to a Change in the Size of a Creation Unit Applicable to Shares of the PIMCO Total Return Active Exchange-Traded Fund | |
| 80 FR 43548 - Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Relating to AIM and FLEX AIM | |
| 80 FR 43474 - Office of Career, Technical, and Adult Education; Rehabilitation Services Administration; Comment Request for Information Collection for the WIOA Performance Management, Information, and Reporting System (OMB Control No. 1205-0NEW), New Collection | |
| 80 FR 43473 - Meeting of the Office of Justice Programs' Science Advisory Board | |
| 80 FR 43443 - Advisory Committee on Training in Primary Care Medicine and Dentistry; Notice of Meeting | |
| 80 FR 43445 - Agency Information Collection Activities: Proposed Collection: Public Comment Request | |
| 80 FR 43441 - Agency Information Collection Activities: Proposed Collection: Public Comment Request | |
| 80 FR 43444 - Agency Information Collection Activities: Submission to OMB for Review and Approval; Public Comment Request | |
| 80 FR 43312 - Establishment and Amendment of Class E Airspace; Bremerton, WA | |
| 80 FR 43311 - Revocation of Class D and E Airspace; Independence, KS | |
| 80 FR 43460 - Notice of Receipt of Complaint; Solicitation of Comments Relating to the Public Interest | |
| 80 FR 43461 - Chloropicrin From China; Scheduling of an Expedited Five-Year Review | |
| 80 FR 43550 - Notice of Intent To Rule on the Change of Use of Aeronautical Property at Coastal Carolina Regional Airport, New Bern, NC | |
| 80 FR 43446 - Agency Information Collection Activities: Submission to OMB for Review and Approval; Public Comment Request | |
| 80 FR 43477 - Information Collection: NRC Form 531 “Request for Taxpayer Identification Number” | |
| 80 FR 43394 - Announcement of Requirements and Registration for National Institute of Standards and Technology Prize Competition-Reference Data Challenge | |
| 80 FR 43449 - Agency Information Collection Activities: Proposed Collection; Comment Request | |
| 80 FR 43447 - Submission for OMB Review; 30-Day Comment Request Process and Outcomes Evaluation of NCI Physical Sciences in Oncology Centers (PS-OC) Initiative (NCI) | |
| 80 FR 43448 - Center for Scientific Review; Notice of Closed Meetings | |
| 80 FR 43449 - National Institute on Alcohol Abuse and Alcoholism; Notice of Meeting | |
| 80 FR 43371 - Approval and Promulgation of Implementation Plans; State of Missouri; Control of Petroleum Liquid Storage, Loading and Transfer | |
| 80 FR 43398 - National Assessment Governing Board Quarterly Board Meeting | |
| 80 FR 43338 - Expansion of Provisional Unlawful Presence Waivers of Inadmissibility | |
| 80 FR 43301 - Guidance for Reporting and Use of Information Concerning Recipient Integrity and Performance | |
| 80 FR 43367 - Drug Abuse Treatment Program | |
| 80 FR 43329 - Novaluron; Pesticide Tolerances | |
| 80 FR 43427 - Controlled Carriers Under the Shipping Act of 1984 | |
| 80 FR 43383 - Partial Exemption of Certain Chemical Substances From Reporting Additional Chemical Data | |
| 80 FR 43373 - Aldicarb, Alternaria destruens, Ampelomyces quisqualis, Azinphos-methyl, Etridiazole, Fenarimol, et al.; Proposed Tolerance and Tolerance Exemption Actions | |
| 80 FR 43559 - Limitations on Terms of Consumer Credit Extended to Service Members and Dependents | |
| 80 FR 43320 - Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards; Updating References |
Forest Service
Industry and Security Bureau
International Trade Administration
National Institute of Standards and Technology
National Oceanic and Atmospheric Administration
Federal Energy Regulatory Commission
Food and Drug Administration
Health Resources and Services Administration
Indian Health Service
National Institutes of Health
Substance Abuse and Mental Health Services Administration
Transportation Security Administration
U.S. Customs and Border Protection
Fish and Wildlife Service
Land Management Bureau
National Park Service
Antitrust Division
Justice Programs Office
Prisons Bureau
Employment and Training Administration
Federal Aviation Administration
Federal Highway Administration
Federal Transit Administration
National Highway Traffic Safety Administration
Comptroller of the Currency
Consult the Reader Aids section at the end of this issue for phone numbers, online resources, finding aids, and notice of recently enacted public laws.
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Executive Office of the President, Office of Management and Budget.
Final guidance.
The Office of Management and Budget (OMB) is issuing final guidance to Federal agencies to implement Section 872 of the Duncan Hunter National Defense Authorization Act for Fiscal Year 2009 (hereafter referred to as “section 872”), as that statute applies to grants. As section 872 required, OMB and the General Services Administration (GSA) have established an integrity and performance system that includes governmentwide data with specified information related to the integrity and performance of entities awarded Federal grants and contracts. This system, currently designated as the Federal Awardee Performance and Integrity Information System (FAPIIS), integrates various sources of information on the eligibility of organizations for Government awards and is currently available at
This final guidance implements section 872's requirements for recipients and Federal awarding agencies to report information that will appear in the OMB-designated integrity and performance system and for Federal awarding agencies to consider information the system contains about a non-Federal entity before awarding a grant to that non-Federal entity. The final guidance for grants, which also applies to cooperative agreements, also addresses how the designated integrity and performance system and other information may be used in assessing recipient integrity.
This guidance is effective January 1, 2016.
Rhea Hubbard, Office of Federal Financial Management, Office of Management and Budget,
A. This final guidance to Federal agencies implement Sections 872 of the Duncan Hunter National Defense Authorization Act for Fiscal Year 2009 (Pub. L. 110-417, codified as amended at 41 U.S.C. 2313).
On February 18, 2010 (75 FR 7316), the Office of Management and Budget (OMB) proposed a number of changes to Title 2 of the Code of Federal Regulations (2 CFR). Since publication of the February 2010
Also since publication of the February 2010
The February 2010
B. The major elements of the proposed guidance, which are addressed in this notice, are requirements for:
• Federal awarding agencies to report information to the designated integrity and performance system about any termination of an award due to a material failure to comply with the award terms and conditions; any administrative agreement with a non-Federal entity to resolve a suspension or debarment proceeding; and any finding that a non-Federal entity is not qualified to receive a given award, if the finding is based on criteria related to the non-Federal entity's integrity or prior performance under Federal awards.
• Recipients that have Federal contract, grant, and cooperative agreement awards with a cumulative total value greater than $10,000,000 to provide information to the designated integrity and performance system about certain civil, criminal, and administrative proceedings that reached final disposition within the most recent five year period and that were connected with the award or performance of a Federal award.
• Recipients that have Federal contract, grant, and cooperative agreement awards with a cumulative total value greater than $10,000,000 are required to disclose semiannually the information about the criminal, civil,
• Federal awarding agencies, prior to making an award to a non-Federal entity, to determine whether that non-Federal entity is qualified to receive that particular award. In making the determination, the Federal awarding agency must take into consideration any information about the entity that is in the designated integrity and performance system.
• Notice of funding opportunities and Federal award terms and conditions to inform a non-Federal entity that it may submit comments to the designated integrity and performance system about any information that the Federal awarding agency had reported to the system about the non-Federal entity, for consideration by the Federal awarding agency in making future Federal awards to the non-Federal entity.
We received comments on these elements of the proposed guidance from four State agencies, seven Federal agencies or agency components, and three associations representing community health centers, academic institutions, and industrial firms, respectively. We considered all comments received and made some of the recommended improvements in developing the final guidance. Some of the more significant changes are to:
• Make the guidance for grants and cooperative agreements as consistent where practicable with the FAPIIS guidance in the Federal Acquisition Regulation (FAR) that applies to procurement contracts (48 CFR 9.104), thereby simplifying implementation for non-Federal entities that receive both Federal assistance and procurement awards;
• provide information on the legislative amendment to section 872, which was enacted after issuance of the proposed guidance, that requires making certain information in the designated integrity and performance system available to the public;
• provide information that must be included in a notice of funding opportunity regarding implementation of integrity and performance reporting;
• clarify the process that a Federal awarding agency follows when making a determination that a non-Federal entity is qualified to receive an award based on a review of information in the designated integrity and performance system and other sources;
• add wording to help ensure that all non-Federal entities, including applicants under programs that do not have program announcements, are fully aware of the potential effects of information about them in the designated integrity and performance system and their right to submit comments about the information; and
• add a requirement that Federal awarding agencies wait 14 calendar days after posting information to the non-public segment of the designated integrity and performance system before making the information available through the public segment of the system to be consistent with the acquisitions community's requirements.
Additional changes were made for clarity or completeness. For example, the simplified acquisition threshold set by the Federal Acquisition Regulation (FAR) at 48 CFR Subpart 2.1 (Definitions) is periodically adjusted for inflation in accordance with 41 U.S.C. 1908 and is now set at $150,000. Consequently, we updated the threshold citation throughout the guidance by including a reference to the definition available at 2 CFR 200.88. Also, several of the systems referred to in the guidance, namely the Central Contractor Registration (CCR) and the Excluded Parties List System (EPLS), have been migrated into SAM and no longer exist as stand-alone systems. Further, the General Services Administration (GSA) plans to migrate the currently designated integrity and performance system, FAPIIS, to SAM and the language describing the system in the final guidance is designed to accommodate future system changes. Additional system migrations to SAM and other central portals will make it easier for agencies and recipients to input and receive information through a central Web site.
C. The designated integrity and performance system integrates various sources of information regarding non-Federal entities to help Federal awarding agencies ensure that a thorough review of available databases with relevant information on to determine whether a recipient is qualified occurs before the issuance of Federal awards. In addition to the designated integrity and performance system, Federal awarding agencies are able to conduct matching to help determine qualification for Federal awards and payments through complementary efforts, such as the Do Not Pay working system maintained by the Department of the Treasury. While Treasury conducts matching against the Do Not Pay working system for all appropriate Federal payments, in accordance with the Improper Payments Elimination and Recovery Improvement Act of 2012, Federal awarding agencies are responsible for determining which of the Do Not Pay databases are appropriate to review for pre-award purposes. As required by 2 CFR part 180, Federal awarding agencies are required to check SAM Exclusions prior to the issuance of Federal awards, which is available directly through SAM or the Do Not Pay working system. Federal awarding agencies are not required to check the other databases that are part of the Do Not Pay working system for pre-award purposes where the Federal awarding agency has determined that the designated integrity and performance system (currently FAPIIS) and SAM provide more relevant information to making decisions on recipient qualification. As governmentwide systems continue to mature, there may be opportunities for further integration between the various systems.
D. Section 872 applies without distinguishing between for-profit and other recipients. Thus, notwithstanding 2 CFR 200.101(c) general permissive application of subparts A through E to for-profits, agencies must apply to for-profit recipients (in agencies' regulations, policies, or directly through the terms and conditions of Federal awards) the requirements reflected in this final guidance. OMB is considering governmentwide guidance to apply consistent treatment towards for-profit grant and cooperative agreement recipients, including the requirements of Section 872.
E. Since publishing the proposed guidance, Section 852 of the National Defense Authorization Act for Fiscal Year 2013 set forth additional requirements for the designated integrity and performance system to include, to the extent practicable, additional information on any parent, subsidiary, or successor entities to corporations included in the system. In order to address these additional requirements, OMB is considering publishing proposed guidance to implement Section 852 of the National Defense Authorization Act for Fiscal Year 2013.
Sections II. A through II. F of this preamble summarize the major comments and our responses. General comments that address more than one portion of the guidance are summarized in section II.A. Each of the other sections addresses comments pertaining to a specific portion of the proposed guidance.
• $500,000—Subsection (b) of section 872 is the source of the $500,000 threshold. It essentially requires that the designated integrity and performance system contain information about each non-Federal entity: (1) That receives a Federal award of more than $500,000; and (2) about which there is a proceeding that must be reported as described in section 872. Therefore, the final guidance following this preamble states that Federal awarding agencies must include the award term and condition requiring the recipient to maintain its information in designated integrity and performance system for each Federal award where it is anticipated that the total Federal share will exceed $500,000 over the period of performance. Note that the award term and condition requires the non-Federal entity to provide the required information through the SAM (formerly CCR) and to provide the information specified in SAM.
• $10,000,000—The source of the $10,000,000 threshold is subsection (f) of section 872. Under that subsection (f) of section 872, a non-Federal entity receiving Federal awards with a total value more than $10,000,000 must submit any information about criminal, civil, and administrative proceedings that section 872 requires and update the information semiannually. Based on feedback or as necessary, OMB may revise the $10,000,000 threshold. Based on feedback, OMB may consider revising this affirmative disclosure threshold for grants and cooperative agreements to the extent legally permissible/consistent with the statute.
• $150,000—The third threshold relates to two requirements for the Federal awarding agency. The source of that threshold, which is at the simplified acquisition threshold set by the FAR at 48 CFR Subpart 2.1 and adjusted periodically to track inflation (currently $150,000), is subparagraph (e)(2)(A) of section 872, which requires the Federal awarding agency to consider information in the designated integrity and performance system before making a Federal award for more than that threshold amount. In addition to implementing that requirement, the final guidance requires the Federal awarding agency to report to the designated integrity and performance system any instance in which the Federal awarding agency does not award a grant or cooperative agreement above that threshold amount to a non-Federal entity based on a determination that the non-Federal entity is not qualified due to its prior record of integrity or performance under Federal awards. The latter requirement is analogous to the requirement for procurement contracts in paragraph (c)(5) of section 872.
Potential outcomes due to reported information depend on the nature of the information. A Federal awarding agency considers the information in the designated integrity and performance system about a non-Federal entity when determining that the non-Federal entity is qualified with respect to a particular Federal award. Information that the non-Federal entity is currently debarred or suspended precludes the making of the Federal award to the non-Federal entity in almost all cases, while other information may or may not lead the Federal awarding agency to determine that the non-Federal entity is not qualified for the Federal award. The Federal awarding agency also may notify other Federal awarding agencies about information in the designated integrity and performance system—
With respect to the commenters' other questions:
• A local government must report if it has a Federal award with an award term and condition making it subject to the reporting requirement. It would not be required to report solely by virtue of being a subrecipient under a Federal award to a State agency.
• The requirement is broader than proceedings related to a recipient's performance under an award. A recipient also must report about proceedings related to the making of a Federal award (
• A State agency must report a proceeding that results in a fine levied against it by another State agency if the violation or activity for which it is fined is in connection with the making of, or performance under, a Federal award.
• The recipient must provide the information about a proceeding that is required in SAM. No other documentation is required.
The other revisions were to replace the term “disqualified” in part 200 with “not qualified,” to remove any potential for confusion with that term as it is used and defined in 2 CFR part 180.
With respect to the second concern that information in the designated integrity and performance system about a non-Federal entity could prevent it from receiving any Federal funding, we note that a Federal awarding agency's determination that a non-Federal entity is not qualified is related to a specific award that is being contemplated. As explained more fully in the response to the previous comment, that determination does not preclude the making of a different Federal award to the non-Federal entity. We revised the wording in multiple places in part 200 to clarify that connection with a specific Federal award.
On the matter of appeals of a Federal awarding agency's determination that a non-Federal entity is not qualified for a Federal award, we did not revise the guidance to require delay of individual Federal awards, to allow an opportunity for appeal after the Federal awarding agency makes the determination. A govermentwide requirement is impractical in light of the constraints under which many Federal programs operate, with firm schedules for program execution that are impelled by statute or needs for timely obligation of appropriated funds. Individual Federal awarding agencies may, if timing constraints for their programs permit, offer an opportunity for appeal or additional input to the Federal awarding agency prior to award. Also note that the commenters' concern should be addressed by the opportunities provided for the non-Federal entity's input. Sections 200.212 and 200.340 require Federal awarding agencies to notify non-Federal entities when information that may be used when Federal awarding agencies are making future funding decisions is entered into the designated performance and integrity system. Non-Federal entities whose information is entered will have the opportunity to comment on information included in the system.
We anticipate that Federal agencies' and recipients' current apprehension about the use of the designated integrity and performance system will abate over time, as they gain practical experience with the system and associated requirements. If lessons learned from the use of the designated integrity and performance system warrant further improvements to the system or clarifications to the guidance, we will carefully evaluate the existing guidance and revise the guidance, as appropriate.
This final guidance is effective for Federal awards issued on or after January 1, 2016 that meet the thresholds as described in the preamble and to existing awards that are terminated on or after January 1, 2016 due to material failure to comply with the Federal award terms and conditions. Federal awarding agencies that have formally adopted 2 CFR parts 180 and 200 in their entirety in 2 CFR will begin implementing this final guidance on January 1, 2016. Federal awarding agencies who adopted 2 CFR parts 180 and 200 through another means must work with OMB to ensure their regulations or policies are updated effective January 1, 2016. OMB will collaborate with GSA to ensure that the user guides and other guidance materials regarding the designated integrity and performance system are updated to reflect use by the Federal assistance community. Applicants and recipients will see the agencies' implementation reflected in requirements identified in notice of funding opportunities or other agency releases with application instructions, as well as in the new award term and condition in Appendix XII to 2 CFR part 200.
Administrative practice and procedure, Debarment and suspension, Grant programs, Loan programs,
Accounting, Auditing, Colleges and universities, State and local governments, Grant programs, Grants administration, Hospitals, Indians, Nonprofit organizations, Reporting and recordkeeping requirements.
For the reasons stated in the preamble and under the authority of the Chief Financial Officer Act of 1990 (31 U.S.C. 503), the Office of Management and Budget amends 2 CFR parts 180 and 200 as set forth below:
Sec. 2455, Pub. L. 103-355, 108 Stat. 3327; E.O. 12549, 3 CFR, 1986 Comp., p. 189; E.O. 12689, 3 CFR, 1989 Comp., p. 235.
Yes, a Federal agency may enter into an administrative agreement with you as part of the settlement of a debarment or suspension action.
The suspending or debarring official who enters into an administrative agreement with you must report information about the agreement to the designated integrity and performance system within three business days after entering into the agreement. This information is required by section 872 of the Duncan Hunter National Defense Authorization Act for Fiscal Year 2009 (41 U.S.C. 2313).
Yes, the suspending or debarring official who entered information into the designated integrity and performance system about an administrative agreement with you:
(a) Must correct the information within three business days if he or she subsequently learns that any of the information is erroneous.
(b) Must correct in the designated integrity and performance system, within three business days, the ending date of the period during which the agreement is in effect, if the agreement is amended to extend that period.
(c) Must report to the designated integrity and performance system, within three business days, any other modification to the administrative agreement.
(d) Is strongly encouraged to amend the information in the designated integrity and performance system in a timely way to incorporate any update that he or she obtains that could be helpful to Federal awarding agencies who must use the system.
31 U.S.C. 503.
The non-Federal entity or applicant for a Federal award must disclose, in a timely manner, in writing to the Federal awarding agency or pass-through entity all violations of Federal criminal law involving fraud, bribery, or gratuity violations potentially affecting the Federal award. Non-Federal entities that have received a Federal award including the term and condition outlined in Appendix XII—Award Term and Condition for Recipient Integrity and Performance Matters are required to report certain civil, criminal, or administrative proceedings to SAM. Failure to make required disclosures can result in any of the remedies described in § 200.338 Remedies for noncompliance, including suspension or debarment. (See also 2 CFR part 180, 31 U.S.C. 3321, and 41 U.S.C. 2313.)
(a)
(2) In accordance 41 U.S.C. 2313, the Federal awarding agency is required to review the publicly available information in the OMB-designated integrity and performance system accessible through SAM (currently the Federal Awardee Performance and Integrity Information System (FAPIIS)) prior to making a Federal award where the Federal share is expected to exceed the simplified acquisition threshold, defined in 41 U.S.C. 134, over the period of performance. At a minimum, the information in the system for a prior Federal award recipient must demonstrate a satisfactory record of executing programs or activities under Federal grants, cooperative agreements, or procurement awards; and integrity and business ethics. The Federal awarding agency may make a Federal award to a recipient who does not fully meet these standards, if it is determined that the information is not relevant to the current Federal award under consideration or there are specific conditions that can appropriately mitigate the effects of the non-Federal entity's risk in accordance with § 200.207 Specific conditions.
(b) * * *
(1) * * *
(iii) Recipient integrity and performance matters. If the total Federal share of the Federal award may include more than $500,000 over the period of performance, the Federal awarding agency must include the term and condition available in Appendix XII—Award Term and Condition for Recipient Integrity and Performance Matters. See also § 200.113 Mandatory disclosures.
(b) All information posted in the designated integrity and performance system accessible through SAM (currently FAPIIS) on or after April 15, 2011 will be publicly available after a waiting period of 14 calendar days, except for:
(1) Past performance reviews required by Federal Government contractors in accordance with the Federal Acquisition Regulation (FAR) 42.15;
(2) Information that was entered prior to April 15, 2011; or
(3) Information that is withdrawn during the 14-calendar day waiting period by the Federal Government official.
(c) Nothing in this section may be construed as requiring the publication of information otherwise exempt under the Freedom of Information Act (5 U.S.C 552), or controlled unclassified information pursuant to Executive Order 13556.
(a) If a Federal awarding agency does not make a Federal award to a non-Federal entity because the official determines that the non-Federal entity does not meet either or both of the minimum qualification standards as described in § 200.205, Federal awarding agency review of risk posed by applicants, paragraph (a)(2), the Federal awarding agency must report that determination to the designated integrity and performance system accessible through SAM (currently FAPIIS), only if all of the following apply:
(1) The only basis for the determination described in paragraph (a) of this section is the non-Federal entity's prior record of executing programs or activities under Federal awards or its record of integrity and business ethics, as described in § 200.205 Federal awarding agency review of risk posed by applicants, paragraph (a)(2) (
(2) The total Federal share of the Federal award that otherwise would be made to the non-Federal entity is expected to exceed the simplified acquisition threshold over the period of performance.
(b) The Federal awarding agency is not required to report a determination that a non-Federal entity is not qualified for a Federal award if they make the Federal award to the non-Federal entity and includes specific award terms and conditions, as described in § 200.207 Specific conditions.
(c) If a Federal awarding agency reports a determination that a non-Federal entity is not qualified for a Federal award, as described in paragraph (a) of this section, the Federal awarding agency also must notify the non-Federal entity that—
(1) The determination was made and reported to the designated integrity and performance system accessible through SAM, and include with the notification an explanation of the basis for the determination;
(2) The information will be kept in the system for a period of five years from the date of the determination, as required by section 872 of Public Law 110-417, as amended (41 U.S.C. 2313), then archived;
(3) Each Federal awarding agency that considers making a Federal award to the non-Federal entity during that five year period must consider that information in judging whether the non-Federal entity is qualified to receive the Federal award when the total Federal share of the Federal award is expected to include an amount of Federal funding in excess of the simplified acquisition threshold over the period of performance;
(4) The non-Federal entity may go to the awardee integrity and performance portal accessible through SAM (currently the Contractor Performance Assessment Reporting System (CPARS)) and comment on any information the system contains about the non-Federal entity itself; and
(5) Federal awarding agencies will consider that non-Federal entity's comments in determining whether the non-Federal entity is qualified for a future Federal award.
(d) If a Federal awarding agency enters information into the designated integrity and performance system accessible through SAM about a determination that a non-Federal entity is not qualified for a Federal award and subsequently:
(1) Learns that any of that information is erroneous, the Federal awarding agency must correct the information in the system within three business days;
(2) Obtains an update to that information that could be helpful to other Federal awarding agencies, the Federal awarding agency is strongly encouraged to amend the information in the system to incorporate the update in a timely way.
(e) Federal awarding agencies shall not post any information that will be made publicly available in the non-public segment of designated integrity and performance system that is covered by a disclosure exemption under the Freedom of Information Act. If the recipient asserts within seven calendar days to the Federal awarding agency that posted the information that some or all of the information made publicly available is covered by a disclosure exemption under the Freedom of Information Act, the Federal awarding agency that posted the information must remove the posting within seven calendar days of receiving the assertion. Prior to reposting the releasable information, the Federal awarding agency must resolve the issue in accordance with the agency's Freedom of Information Act procedures.
Non-federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. These regulations restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities.
(b) When a Federal awarding agency terminates a Federal award prior to the
(1) The information required under paragraph (b) of this section is not to be reported to designated integrity and performance system until the non-Federal entity either—
(i) Has exhausted its opportunities to object or challenge the decision, see § 200.341 Opportunities to object, hearings and appeals; or
(ii) Has not, within 30 calendar days after being notified of the termination, informed the Federal awarding agency that it intends to appeal the Federal awarding agency's decision to terminate.
(2) If a Federal awarding agency, after entering information into the designated integrity and performance system about a termination, subsequently:
(i) Learns that any of that information is erroneous, the Federal awarding agency must correct the information in the system within three business days;
(ii) Obtains an update to that information that could be helpful to other Federal awarding agencies, the Federal awarding agency is strongly encouraged to amend the information in the system to incorporate the update in a timely way.
(3) Federal awarding agencies, shall not post any information that will be made publicly available in the non-public segment of designated integrity and performance system that is covered by a disclosure exemption under the Freedom of Information Act. If the non-Federal entity asserts within seven calendar days to the Federal awarding agency who posted the information, that some of the information made publicly available is covered by a disclosure exemption under the Freedom of Information Act, the Federal awarding agency who posted the information must remove the posting within seven calendar days of receiving the assertion. Prior to reposting the releasable information, the Federal agency must resolve the issue in accordance with the agency's Freedom of Information Act procedures.
(c) When a Federal award is terminated or partially terminated, both the Federal awarding agency or pass-through entity and the non-Federal entity remain responsible for compliance with the requirements in §§ 200.343 Closeout and 200.344 Post-closeout adjustments and continuing responsibilities.
(b) If the Federal award is terminated for the non-Federal entity's material failure to comply with the Federal statutes, regulations, or terms and conditions of the Federal award, the notification must state that—
(1) The termination decision will be reported to the OMB-designated integrity and performance system accessible through SAM (currently FAPIIS);
(2) The information will be available in the OMB-designated integrity and performance system for a period of five years from the date of the termination, then archived;
(3) Federal awarding agencies that consider making a Federal award to the non-Federal entity during that five year period must consider that information in judging whether the non-Federal entity is qualified to receive the Federal award, when the Federal share of the Federal award is expected to exceed the simplified acquisition threshold over the period of performance;
(4) The non-Federal entity may comment on any information the OMB-designated integrity and performance system contains about the non-Federal entity for future consideration by Federal awarding agencies. The non-Federal entity may submit comments to the awardee integrity and performance portal accessible through SAM (currently (CPARS).
(5) Federal awarding agencies will consider non-Federal entity comments when determining whether the non-Federal entity is qualified for a future Federal award.
E. * * *
3. For any Federal award under a notice of funding opportunity, if the Federal awarding agency anticipates that the total Federal share will be greater than the simplified acquisition threshold on any Federal award under a notice of funding opportunity may include, over the period of performance (see § 200.88 Simplified Acquisition Threshold), this section must also inform applicants:
i. That the Federal awarding agency, prior to making a Federal award with a total amount of Federal share greater than the simplified acquisition threshold, is required to review and consider any information about the applicant that is in the designated integrity and performance system accessible through SAM (currently FAPIIS) (see 41 U.S.C. 2313);
ii. That an applicant, at its option, may review information in the designated integrity and performance systems accessible through SAM and comment on any information about itself that a Federal awarding agency previously entered and is currently in the designated integrity and performance system accessible through SAM;
iii. That the Federal awarding agency will consider any comments by the applicant, in addition to the other information in the designated integrity and performance system, in making a judgment about the applicant's integrity, business ethics, and record of performance under Federal awards when completing the review of risk posed by applicants as described in § 200.205 Federal awarding agency review of risk posed by applicants.
4.
F. * * *
3. Reporting—Required. This section must include general information about the type (
If the Federal share of any Federal award may include more than $500,000 over the period of performance, this section must inform potential applicants about the post award reporting requirements reflected in Appendix XII—Award Term and Condition for Recipient Integrity and Performance Matters.
If the total value of your currently active grants, cooperative agreements, and procurement contracts from all Federal awarding agencies exceeds $10,000,000 for any period of time during the period of performance of this Federal award, then you as the recipient during that period of time must maintain the currency of information reported to the System for Award Management (SAM) that is made available in the designated integrity and performance system (currently the Federal Awardee Performance and Integrity Information System (FAPIIS)) about civil, criminal, or administrative proceedings described in paragraph 2 of this award term and condition. This is a statutory requirement under section 872 of Public Law 110-417, as amended (41 U.S.C. 2313). As required by section 3010 of Public Law 111-212, all information posted in the designated integrity and performance system on or after April 15, 2011, except past performance reviews required for Federal procurement contracts, will be publicly available.
Submit the information required about each proceeding that:
a. Is in connection with the award or performance of a grant, cooperative agreement, or procurement contract from the Federal Government;
b. Reached its final disposition during the most recent five year period; and
c. Is one of the following:
(1) A criminal proceeding that resulted in a conviction, as defined in paragraph 5 of this award term and condition;
(2) A civil proceeding that resulted in a finding of fault and liability and payment of a monetary fine, penalty, reimbursement, restitution, or damages of $5,000 or more;
(3) An administrative proceeding, as defined in paragraph 5. of this award term and condition, that resulted in a finding of fault and liability and your payment of either a monetary fine or penalty of $5,000 or more or reimbursement, restitution, or damages in excess of $100,000; or
(4) Any other criminal, civil, or administrative proceeding if:
(i) It could have led to an outcome described in paragraph 2.c.(1), (2), or (3) of this award term and condition;
(ii) It had a different disposition arrived at by consent or compromise with an acknowledgment of fault on your part; and
(iii) The requirement in this award term and condition to disclose information about the proceeding does not conflict with applicable laws and regulations.
Enter in the SAM Entity Management area the information that SAM requires about each proceeding described in paragraph 2 of this award term and condition. You do not need to submit the information a second time under assistance awards that you received if you already provided the information through SAM because you were required to do so under Federal procurement contracts that you were awarded.
During any period of time when you are subject to the requirement in paragraph 1 of this award term and condition, you must report proceedings information through SAM for the most recent five year period, either to report new information about any proceeding(s) that you have not reported previously or affirm that there is no new information to report. Recipients that have Federal contract, grant, and cooperative agreement awards with a cumulative total value greater than $10,000,000 must disclose semiannually any information about the criminal, civil, and administrative proceedings.
For purposes of this award term and condition:
a. Administrative proceeding means a non-judicial process that is adjudicatory in nature in order to make a determination of fault or liability (
b. Conviction, for purposes of this award term and condition, means a judgment or conviction of a criminal offense by any court of competent jurisdiction, whether entered upon a verdict or a plea, and includes a conviction entered upon a plea of nolo contendere.
c. Total value of currently active grants, cooperative agreements, and procurement contracts includes—
(1) Only the Federal share of the funding under any Federal award with a recipient cost share or match; and
(2) The value of all expected funding increments under a Federal award and options, even if not yet exercised.
B. [Reserved]
Federal Aviation Administration (FAA), DOT.
Final rule.
This action removes Class D airspace and the associated Class E surface area airspace at Independence Municipal Airport, Independence, KS. Closure of the airport's air traffic control tower has necessitated the need for this action.
Effective 0901 UTC, October 15, 2015. The Director of the Federal Register approves this incorporation by reference action under title 1, Code of Federal Regulations, part 51, subject to the annual revision of FAA Order 7400.9 and publication of conforming amendments.
FAA Order 7400.9Y, Airspace Designations and Reporting Points, and subsequent amendments can be viewed on line at
FAA Order 7400.9, Airspace Designations and Reporting Points, is published yearly and effective on September 15. For further information, you can contact the Airspace Policy and ATC Regulations Group, Federal Aviation Administration, 800 Independence Avenue SW., Washington, DC 29591; telephone: 202-267-8783.
Raul Garza, Jr., Central Service Center, Operations Support Group, Federal Aviation Administration, Southwest Region, 2601 Meacham Blvd., Fort Worth, TX 76137; telephone: 817-222-4075.
The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the United States Code. 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. This rulemaking is promulgated under the authority described in Subtitle VII, Part, A, Subpart I, Section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it removes
On May 8, 2015, the FAA published in the
Class D and E airspace areas are published in Paragraph 5000 and 6002, respectively, of FAA Order 7400.9Y, dated August 6, 2014, and effective September 15, 2014, which is incorporated by reference in 14 CFR 71.1. The Class D and E airspace designations listed in this document will be published subsequently in the Order.
This document amends FAA Order 7400.9Y, airspace Designations and Reporting Points, dated August 6, 2014, and effective September 15, 2014. FAA Order 7400.9Y is publicly available as listed in the
This action amends Title 14, Code of Federal Regulations (14 CFR), Part 71 by removing Class D airspace and the associated Class E surface area airspace at Independence Municipal Airport, Independence, KS, as the air traffic control tower has closed and controlled airspace is no longer needed.
Class D and E airspace areas are published in Paragraph 5000 and 6002, respectively, of FAA Order 7400.9Y, dated August 6, 2014, and effective September 15, 2014, which is incorporated by reference in 14 CFR 71.1. The Class D and E airspace designations listed in this document will be published subsequently in the Order.
The FAA has determined that this regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. Therefore, this regulation: (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); and (3) does not warrant preparation of a regulatory evaluation as the anticipated impact is so minimal. Since this is a routine matter that only affects air traffic procedures and air navigation, it is certified that this rule, when promulgated, does not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.
The FAA has determined that this action qualifies for categorical exclusion under the National Environmental Policy Act in accordance with FAA Order 1050.1E. “Environmental Impacts: Policies and Procedures,” paragraph 311a. This airspace action is not expected to cause any potentially significant environmental impacts, and no extraordinary circumstances exist that warrant preparation of an environmental assessment.
Airspace, Incorporation by reference, Navigation (air).
In consideration of the foregoing, the Federal Aviation Administration amends 14 CFR part 71 as follows:
49 U.S.C. 106(f), 106(g); 40103, 40113, 40120; E.O. 10854, 24 FR 9565, 3 CFR, 1959-1963 Comp., p. 389.
Federal Aviation Administration (FAA), DOT.
Final rule.
This action modifies and establishes Class E airspace at Bremerton National Airport, Bremerton, WA, to accommodate new Standard Instrument Approach Procedures (SIAPs) at Bremerton National airport due to the decommissioning of the Kitsap non-directional radio beacon (NDB). The FAA is taking this action to enhance the safety and management of Instrument Flight Rules (IFR) operations at the airport.
Effective 0901 UTC, October 15, 2015. The Director of the Federal Register approves this incorporation by reference action under title 1, Code of Federal Regulations, part 51, subject to the annual revision of FAA Order 7400.9 and publication of conforming amendments.
FAA Order 7400.9Y, Airspace Designations and Reporting Points, and subsequent amendments can be viewed on line at
FAA Order 7400.9, Airspace Designations and Reporting Points, is published yearly and effective on September 15. For further information, you can contact the Airspace Policy and ATC Regulations Group, Federal Aviation Administration, 800 Independence Avenue SW., Washington, DC 29591; telephone: 202-267-8783.
Steve Haga, Federal Aviation Administration, Operations Support Group, Western Service Center, 1601 Lind Avenue SW., Renton, WA 98057; telephone (425) 203-4563.
The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the United States Code. 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. This rulemaking is promulgated under the authority described in Subtitle VII, Part A, Subpart I, Section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it amends controlled airspace at Bremerton National Airport, Bremerton, WA.
On May 8, 2015, the FAA published in the
Class E airspace designations are published in paragraph 6002 and 6005, respectively, of FAA Order 7400.9Y, dated August 6, 2014, and effective September 15, 2014, which is incorporated by reference in 14 CFR 71.1. The Class E airspace designations listed in this document will be published subsequently in the Order.
This document amends FAA Order 7400.9Y, airspace Designations and Reporting Points, dated August 6, 2014, and effective September 15, 2014. FAA Order 7400.9Y is publicly available as listed in the
This amendment to Title 14, Code of Federal Regulations (14 CFR) part 71 modifies Class E surface area airspace and establishes Class E airspace extending upward from 700 feet above the surface at Bremerton National Airport, Bremerton, WA. Class E surface area airspace is adjusted to be defined from the Bremerton National Airport reference point versus the decommissioned Kitsap NDB, with segments extending from the 4.1-mile radius of the airport to 6.1 miles southwest, and 6.1 miles northeast of the airport. Class E airspace extending upward from 700 feet above the surface would be established extending from the 6.1-mile radius of the airport to 7.6 miles northeast of the airport, and 8.1 miles southwest of the airport. This action enhances the safety and management of controlled airspace within the NAS.
The FAA has determined that this regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current, is non-controversial and unlikely to result in adverse or negative comments. It, therefore, (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); and (3) does not warrant preparation of a Regulatory Evaluation as the anticipated impact is so minimal. Since this is a routine matter that only affects air traffic procedures and air navigation, it is certified that this rule, when promulgated, does not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.
The FAA has determined that this action qualifies for categorical exclusion under the National Environmental Policy Act in accordance with FAA Order 1050.1E, “Environmental Impacts: Policies and Procedures,” paragraph 311a. This airspace action is not expected to cause any potentially significant environmental impacts, and no extraordinary circumstances exist that warrant preparation of an environmental assessment.
Airspace, Incorporation by reference, Navigation (air).
In consideration of the foregoing, the Federal Aviation Administration amends 14 CFR part 71 as follows:
49 U.S.C. 106(f), 106(g); 40103, 40113, 40120; E.O. 10854, 24 FR 9565, 3 CFR, 1959-1963 Comp., p. 389.
That airspace within a 4.1-mile radius of Bremerton National Airport, and within 2 miles each side of the 33° bearing from the airport extending from the 4.1-mile radius to 6.1 miles northeast of the airport, and within 2 miles each side of the 213° bearing from the airport extending from the 4.1-mile radius to 6.1 miles southwest of the airport.
That airspace extending upward from 700 feet above the surface within 2 miles each side of the 33° bearing from Bremerton National Airport extending from 6.1-miles to 7.6 miles northeast of the airport, and within 2 miles each side of the 213° bearing from the airport extending from the 6.1-mile radius of the airport to 8.1 miles southwest of the airport.
Bureau of Industry and Security, Commerce.
Final rule.
This rule amends the Export Administration Regulations (EAR) to implement the rescission of Cuba's designation as a State Sponsor of Terrorism. Specifically, this rule removes anti-terrorism (AT) license requirements from Cuba and eliminates references to Cuba as a State Sponsor of Terrorism, but maintains preexisting license requirements for all items subject to the EAR unless authorized by a license exception. This rule also removes Cuba from Country Group E:1 (terrorist supporting countries), which makes Cuba eligible for a general 25 percent
This rule is effective July 22, 2015.
Foreign Policy Division, Office of Nonproliferation and Treaty Compliance, Bureau of Industry and Security, Phone: (202) 482-4252.
The United States maintains a comprehensive embargo on trade with Cuba. Pursuant to that embargo, all items that are subject to the Export Administration Regulations (EAR) require a license for export or reexport to Cuba unless authorized by a license exception. The Bureau of Industry and Security (BIS) administers export and reexport restrictions on Cuba consistent with the goals of that embargo and with relevant law. Accordingly, BIS may issue specific or general authorizations in the form of licenses or license exceptions for transactions that support the goals of United States policy while the embargo remains in effect.
On December 17, 2014, the President announced that the United States is taking steps to chart a new course in bilateral relations with Cuba and to further engage and empower the Cuban people. As one of these steps, the President directed the Secretary of State to review Cuba's designation as a State Sponsor of Terrorism and provide a report to the President within six months. Cuba was designated as a State Sponsor of Terrorism in 1982. Pursuant to Sections 6(a) and 6(j) of the Export Administration Act of 1979, as amended (EAA), State Sponsors of Terrorism are subject to anti-terrorism (AT) controls and certain other restrictions in the EAR. Once designated, a country remains a State Sponsor of Terrorism until its designation is rescinded in accordance with the relevant statutes (Section 6(j) of the EAA; Section 40 of the Arms Export Control Act of 1976, as amended; and Section 620A of the Foreign Assistance Act of 1961, as amended).
There are two possible paths to rescission of a State Sponsor of Terrorism designation under the relevant statutes. The first requires the President to submit a report to Congress before the proposed rescission would take effect certifying that (1) there has been a fundamental change in the leadership and policies of the government of the country concerned, (2) the government is not supporting acts of international terrorism, and (3) the government has provided assurances that it will not support acts of international terrorism in the future. The second path requires that the President submit a report to Congress, at least 45 days before the proposed rescission would take effect, justifying the rescission and certifying the subject government has not provided any support for international terrorism for the preceding six-month period and has given assurances that it will not support acts of international terrorism in the future. The rescission of Cuba's designation was done consistent with the second path.
On April 8, 2015, the Secretary of State completed the review requested by the President and submitted his analysis to the President recommending that Cuba should no longer be designated as a State Sponsors of Terrorism. On April 14, 2015, the President submitted to Congress the statutorily required report indicating the Administration's intent to rescind Cuba's State Sponsor of Terrorism designation, including the certification that Cuba has not provided any support for international terrorism during the previous six months; and that Cuba has provided assurances that it will not support acts of international terrorism in the future. The Secretary of State then made the final decision to rescind Cuba's designation as a State Sponsor of Terrorism, which was effective on May 29, 2015. Accordingly, this rule removes references to Cuba as a State Sponsor of Terrorism and removes anti-terrorism (AT) controls from Cuba.
However, Cuba is still subject to a comprehensive embargo and, as specified in § 746.2(a) of the EAR, a license is still required to export or reexport to Cuba any item subject to the EAR unless authorized by a license exception. Only those license exceptions listed in § 746.2(a) may be used to export or reexport to Cuba. These requirements of § 746.2(a) apply to all items subject to the EAR, including EAR99 items and items that are controlled on the Commerce Control List (CCL) only for AT reasons.
This rule removes:
• The reference to “counter-terrorism” from the licensing policy that applies to certain exports intended to provide support for the Cuban people that appears in § 746.2(b)(4)(i) (which will be redesignated as § 746.2(b)(3)(i));
• § 746.2(c), which identifies Cuba as a country whose government has repeatedly provided support for acts of international terrorism;
• the references to “terrorism” and “state sponsors of terrorism” from § 746.2(e), which describes the license requirements regarding Cuba of the U.S. Department of the Treasury, Office of Foreign Assets Control and the U.S. Department of State; and
• the word “Cuba” from the statements of anti-terrorism license requirements in Export Control Classification Numbers 1C350, 1C355, 1C395, 2A994, 2D994 and 2E994.
This rule also removes Cuba from the following provisions, which list countries that have been designated as State Sponsors of Terrorism or that have repeatedly supported acts of international terrorism: § 742.1(d); Supplement No. 2 to part 742,
Finally, this rule removes Cuba from Country Group E:1—Terrorist Supporting Countries—in Supplement No. 1 to Part 740—Country Groups. However, Cuba remains in Country Group E:2—Unilateral embargo. Cuba also remains in Country Groups D:2, D:3, and D:5. Because country groups are used to specify the countries that are subject to certain provisions of the EAR, particularly license exceptions, and to impose certain restrictions, removal of Cuba from Country Group E:1 can have effects elsewhere in the EAR as will be discussed below.
The EAR apply to items that contain more than a
With the general increase in the
Foreign-made items destined for Cuba that incorporate U.S.-origin 9x515 or “600 series” .y content continue to be subject to the EAR regardless of the level of U.S.-origin content,
The EAR apply to foreign-made national security items that are the direct product of U.S.-origin national security technology and software. Such items are subject to the EAR (and require a license) if destined to a country in Country Group D:1 or E:1. This rule retains Cuba as one of the destinations that is subject to this requirement by adding Country Group E:2 to § 736.2(b)(3).
The provisions of the four license exceptions described below contain restrictions that apply to countries in Country Group E:1 or to nationals of those countries. This section describes the restrictions that will no longer apply to Cuba or Cuban nationals as a result of Cuba's removal from Country Group E:1. This rule makes no change to the text of the four license exceptions because the removal of the restrictions results from the removal of Cuba from Country Group E:1 and no changes to the text of the license exceptions are needed.
The removal of Cuba from Country Group E:1 implicates only paragraph (a) of License Exception Servicing and Replacement of Parts and Equipment (RPL) in § 740.10 because only paragraph (a), which authorizes export and reexport of one-for-one replacement parts for items previously lawfully exported, is authorized for Cuba in § 746.2 of the EAR. Since Cuba is no longer in Country Group E:1, the following exclusions to License Exception RPL, paragraph (a) no longer apply to Cuba: paragraph (a)(3)(iv), which excludes parts, components, accessories, or attachments to repair “aircraft” or commodities controlled for national security (NS) reasons; paragraph (a)(3)(v), which excludes parts, components, accessories, or attachments to repair explosives detection equipment classified under Export Control Classification Number (ECCN) 2A983 or related software classified under ECCN 2D983; and paragraph (a)(3)(vi) which excludes parts, components, accessories, or attachments to repair concealed object detection equipment classified under ECCN 2A984 or related software classified under ECCN 2D984.
Since Cuba is no longer in Country Group E:1, the following restrictions in License Exception GOV (§ 740.11) no longer apply to Cuban nationals: Paragraph (a)(2)(iv), which restricts physical or computational access by Country Group E:1 nationals to certain computers for authorized international safeguard use in connection with activities of the International Atomic Energy Agency and the European Atomic Energy Community; paragraph (d)(4), which restricts physical or computational access by Country Group E:1 nationals to certain computers for authorized international inspection and verification use in connection with the activities of the Organization for the Prohibition of Chemical Weapons; and paragraph (e)(7)(i), which precludes export, reexport or transfer (in-country) to Country Group E:1 nationals of items used to support the International Space Station. Additionally, paragraph (e)(8)(iii), which precludes return of parts for the International Space Station to destinations in Country Group E:1, no longer applies to Cuba.
Since Cuba is no longer in Country Group E:1, § 740.14(f)(1), which authorizes certain exports and reexports of encryption commodities and software subject to Encryption Items (EI) controls on the CCL by United States citizens and permanent resident aliens to destinations other than Country Group E:1, and § 740.14(f)(2), which authorizes such exports and reexports by individuals other than nationals of a country in Country Group E:1, no longer apply to Cuba or Cuban nationals. Additionally, § 740.14(g), which authorizes certain exports and reexports of technology by U.S. persons, but excludes in paragraph (g)(4) exports and reexports of encryption technology controlled in ECCN 5E002 to destinations in Country Group E:1, no longer applies to Cuba.
The removal of Cuba from Country Group E:1 implicates only paragraph (a) of License Exception Aircraft, Vessels and Spacecraft (AVS) in § 740.15 because only paragraph (a), which authorizes aircraft on temporary
• Paragraph (a)(1)(i), which prohibits use of AVS for foreign registered aircraft that were transferred to a national of a country in Country Group E:1 while in the United States;
• Paragraph (a)(1)(ii), which prohibits use of AVS for foreign registered aircraft that are departing the United States for purpose of transfer to a national of a country in Country Group E:1;
• Paragraph (a)(2)(ii), which prohibits use of AVS for U.S. registered aircraft that are not operating under an Air Carrier Operating Certificate, Commercial Operating Certificate or Air Taxi Operating Certificate from using AVS for temporary sojourns to a country in Country Group E:1;
• Paragraph (a)(3)(iv), which prohibits principal maintenance in Country Group E:1 or right to control the principal place of maintenance by a national of a country in Country Group E:1;
• Paragraph (a)(3)(v), which prohibits location of spares in a destination in Country Group E:1;
• Paragraph (a)(3)(vi), which prohibits changing the place of registration to a destination in Country Group E:1;
• Paragraph (a)(3)(vii), which prohibits transfer of technology to a national of a country in Country Group E:1;
• Paragraph (a)(3)(viii), which prohibits aircraft bearing livery, colors or logos of a national of a country in Country Group E:1; and
• Paragraph (a)(3)(ix), which prohibits flying under a flight number issued to a national of a country in Country Group E:1.
Although Cuba is removed from Country Group E:1, Cuba is still subject to a comprehensive embargo and, as specified in § 746.2(a) of the EAR, a license is still required to export or reexport to Cuba any item subject to the EAR unless authorized by a license exception. This rule makes the changes described below to retain the applicability of certain provisions and license conditions to Cuba, consistent with the embargo, that would otherwise cease as a result of Cuba's removal from Country Group E:1. While Cuba was in Country Group E:1, a separate reference to Country Group E:2 would have had no effect on exports or reexports to Cuba. With the removal of Cuba from Country Group E:1, it is necessary to explicitly link these provisions and conditions to the embargo.
Before an exporter or reexporter is able to use License Exception Technology and Software under Restriction (TSR) in § 740.6 of the EAR to export or reexport software or technology controlled for national security reasons, the exporter or reexporter must obtain a written assurance from the consignee that the software or technology transferred and its direct product will not be sent to destinations in Country Group D:1 or E:1 or released to nationals thereof. This rule retains that restriction with respect to Cuba by adding Country Group E:2 to those written assurance requirements. The need for a written assurance is appropriate for countries in Country Groups E:1 and E:2. However, until the removal of Cuba from Country Group E:1, listing both country groups would have been redundant.
Note that License Exception TSR does not authorize exports or reexports to Cuba because it is not specified in § 746.2(a)(1) of the EAR and because, by its terms, License Exception TSR is available only for destinations in Country Group B, which does not include Cuba.
Supplement No. 2 to Part 748 of the EAR describes information required to be included in license applications for certain specific situations. Paragraph (i)(2)(x) requires that technology intended to accompany any shipment to destinations in Country Group D:1 or E:1 be described in the application. Paragraph (o)(3)(i) requires applicants for licenses to export or reexport national security controlled technology to obtain a written assurance against transfer to destinations in Country Groups D:1 or E:1. This rule adds Country Group E:2 to both paragraphs to continue both requirements with respect to Cuba.
Part 758 of the EAR describes certain export clearance requirements. Section 758.1(b)(1) makes the $2,500 threshold below which most exports need not be filed in the Automated Export System (AES) inapplicable for exports to Country Group E:1 by requiring such filing for exports to Country Group E:1 regardless of value. This rule retains that requirement for exports to Cuba by adding Country Group E:2 to § 758.1(b)(1).
Section 758.2(b)(3) makes export to Country Group E:1 grounds for rejecting applications for post-departure filing in AES (
Supplement No. 1 to Part 736 of the EAR contains certain general orders. This rule adds General Order No. 3, which was reserved, to continue all restrictions on transactions with Cuba or Cuban nationals, by reference to Country Group E:1, that are contained in licenses issued prior to July 22, 2015. Certain licenses issued by BIS contain conditions that restrict the export, reexport, or transfer (in-country) to State Sponsors of Terrorism and countries subject to unilateral embargo by reference to Country Group E:1. Many of those restrictions were intended to apply to Cuba, not only as a State Sponsor of Terrorism but also as a country subject to unilateral embargo. However, BIS did not always list both Country Groups E:1 and E:2 in license conditions because, at the time, doing so would have been redundant. This general order applies those conditions to Country Groups E:1 and E:2. Licensees who seek authorization for transactions that are affected by General Order No. 3, may submit license applications that refer to General Order No. 3 and explain the reason for the request in Block 24 of the application. All license applications involving Cuba are reviewed pursuant to the licensing policy in § 746.2(b) of the EAR.
This rule adds a reference to Country Group E:2 to the note that immediately follows the control table in ECCN 4A003. That note states that except for destinations in Country Group E:1, no license is required for computers with an Adjusted Peak Performance not exceeding 8.0 weighted teraFLOPS. The addition of Country Group E:2 retains Cuba's status as a destination for which a license is required.
Although the Export Administration Act expired on August 20, 2001, the President, through Executive Order 13222 of August 17, 2001, 3 CFR, 2001 Comp., p. 783 (2002), as amended by Executive Order 13637 of March 8, 2013, 78 FR 16129 (March 13, 2013), and as extended by the Notice of August
1. Executive Orders 13563 and 12866 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This rule has been designated a “significant regulatory action,” although not economically significant, under section 3(f) of Executive Order 12866. Accordingly, the rule has been reviewed by the Office of Management and Budget (OMB).
2. Notwithstanding any other provision of law, no person is required to respond to, nor shall any person be subject to a penalty for failure to comply with, a collection of information subject to the requirements of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501
Send comments regarding this burden estimate or any other aspect of this collection of information, including suggestions for reducing the burden, to Jasmeet K. Seehra, Office of Management and Budget, by email at
3. This rule does not contain policies with Federalism implications as that term is defined under Executive Order 13132.
4. The provisions of the Administrative Procedure Act (5 U.S.C. 553) requiring notice of proposed rulemaking, the opportunity for public participation, and a delay in effective date, are inapplicable because this regulation involves a military or foreign affairs function of the United States (
Administrative practice and procedure, Exports, Inventions and patents, Research, Science and technology.
Exports.
Administrative practice and procedure, Exports, Reporting and recordkeeping requirements.
Exports, Terrorism.
Exports, Reporting and recordkeeping requirements.
Accordingly, parts 734, 736, 740, 742, 746, 748, 750, 758, 772, and 774 of the Export Administration Regulations (15 CFR parts 730-774) are amended as follows:
50 U.S.C. app. 2401
(a) * * *
(6) * * *
(ii) There is no
50 U.S.C. app. 2401
(6) * * *
(b) * * *
(3)
(iii)
(c) General Order No. 3:
General Order No. 3 of July 22, 2015. Certain licenses issued by BIS prior to July 22, 2015 contain conditions that restrict the export, reexport, or transfer (in-country) to or within Country Group E:1 as specified in Supplement No. 1 to part 740 of the EAR. At the time those license were issued, Cuba was in Country Group E:1. Many of those restrictions were intended to apply to Cuba, not only as a State Sponsor of Terrorism but also as a country subject to unilateral embargo. However, BIS did not always list both Country Groups E:1 and E:2 in license conditions because, at the time, doing so would have been redundant. However, with the rescission of Cuba's designation as a State Sponsor of Terrorism and resultant removal from Country Group E:1, continuing those conditions with respect to Cuba is consistent with the embargo. Accordingly, all conditions that apply to Country Group E:1 on licenses issued prior to July 22, 2015 that are in effect on that date, are revised to apply to Country Groups E:1 and E:2 as specified in Supplement No. 1 to part 740 of the EAR. Licensees who seek authorization for transactions that are affected by this General Order No. 3 may submit license applications that refer to General Order No. 3 and explain the reason for the request in Block 24 of the application. All license applications involving Cuba are reviewed pursuant to the licensing policy in § 746.2(b) of the EAR. The request should provide any available information in support of the argument that the transaction would be consistent with the licensing policy in § 746.2(b) of the EAR.
50 U.S.C. app. 2401
50 U.S.C. app. 2401
50 U.S.C. app. 2401
The revision to read as follows:
(d)
50 U.S.C. app. 2401
50 U.S.C. app. 2401
50 U.S.C. app. 2401
50 U.S.C. app. 2401
50 U.S.C. app. 2401
AT applies to entire entry. The Commerce Country Chart is not designed to determine licensing requirements for items controlled for AT reasons in 1C350. A license is required, for AT reasons, to export or reexport items controlled by 1C350 to a country in Country Group E:1 of Supplement No. 1 to part 740 of the EAR. (See part 742 of the EAR for additional information on the AT controls that apply to Iran, North Korea, Sudan, and Syria. See part 746 of the EAR for additional information on sanctions that apply to Iran, North Korea, and Syria.)
AT applies to entire entry. The Commerce Country Chart is not designed to determine licensing requirements for items controlled for AT reasons in 1C350. A license is required, for AT reasons, to export or reexport items controlled by 1C350 to a country in Country Group E:1 of Supplement No. 1 to part 740 of the EAR. (See part 742 of the EAR for additional information on the AT controls that apply to Iran, North Korea, Sudan, and Syria. See part 746 of the EAR for additional information on sanctions that apply to Iran, North Korea, and Syria.)
AT applies to entire entry. The Commerce Country Chart is not designed to determine licensing requirements for items controlled for AT reasons in 1C395. A license is required, for AT reasons, to export or reexport items controlled by 1C395 to a country in Country Group E:1 of Supplement No. 1 to part 740 of the EAR. (See part 742 of the EAR for additional information on the AT controls that apply to Iran, North Korea, Sudan, and Syria. See part 746 of the EAR for additional information on sanctions that apply to Iran, North Korea, and Syria.)
Food and Drug Administration, HHS.
Direct final rule; confirmation of effective date.
The Food and Drug Administration (FDA or we) is confirming the effective date of August 26, 2015, for the direct final rule that appeared in the
Effective date of the final rule published in the
Scott Gonzalez, Center for Devices and Radiological Health, Food and Drug Administration, 10903 New Hampshire Ave., Bldg. 66, Rm. 4641, Silver Spring, MD 20993-0002, 301-796-5889.
In the
21 U.S.C. 351, 352, 360e-360j, 360hh-360ss, 371, 381. Accordingly, the amendment issued thereby is effective.
Department of Veterans Affairs.
Final rule.
The Department of Veterans Affairs (VA) is amending its regulations with updated citations and references to Office of Management and Budget (OMB) authorities for Federal grant programs. OMB has issued final guidance, located in Title 2 of the Code of Federal Regulations (CFR), which streamlines and supersedes requirements previously found in various OMB Circulars. VA has adopted OMB's guidance, and this rule replaces the obsolete OMB references in VA's regulations.
This final rule is effective July 22, 2015.
Brian McCarthy, Office of Regulatory and Administrative Affairs (10B4), Veterans Health Administration, Department of Veterans Affairs, 810 Vermont Ave. NW., Washington, DC 20420, (202) 461-6345. (This is not a toll-free telephone number.)
The Office of Management and Budget (OMB) is streamlining the Federal government's guidance on Administrative Requirements, Cost Principles, and Audit Requirements for Federal awards. In a document published in the
On December 19, 2014, OMB published a joint interim final rule in the
Because of these changes, existing references in VA's regulations to the superseded OMB guidance documents and to parts 41 and 43 are obsolete. Accordingly, we are amending various VA regulations located in 38 CFR parts 17, 39, 48, 51, 52, 53, 59, 61, 62, and 64 to replace the obsolete references with references to the current authority. For the same reason, we are removing part 49 of title 38 CFR, which codified OMB Circular A-110, and amending VA's regulations referencing part 49 to reference 2 CFR part 200 instead.
The Secretary of Veterans Affairs finds there is good cause under the provisions of 5 U.S.C. 553(b)(B) and (d)(3) to publish this rule without prior
Executive Orders 12866 and 13563 direct agencies to assess the costs and benefits of available regulatory alternatives and, when regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, and other advantages; distributive impacts; and equity). Executive Order 13563 (Improving Regulation and Regulatory Review) emphasizes the importance of quantifying both costs and benefits, reducing costs, harmonizing rules, and promoting flexibility. Executive Order 12866 (Regulatory Planning and Review) defines a “significant regulatory action,” which requires review by OMB, unless OMB waives such review, as “any regulatory action that is likely to result in a rule that may: (1) Have an annual effect on the economy of $100 million or more or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal governments or communities; (2) Create a serious inconsistency or otherwise interfere with an action taken or planned by another agency; (3) Materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights and obligations of recipients thereof; or (4) Raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in this Executive Order.”
The economic, interagency, budgetary, legal, and policy implications of this regulatory action have been examined, and it has been determined not to be a significant regulatory action under Executive Order 12866. VA's impact analysis can be found as a supporting document at
The Secretary hereby certifies that this final rule will not have a significant economic impact on a substantial number of small entities as they are defined in the Regulatory Flexibility Act (5 U.S.C. 601-612) because the amendments are merely technical in nature. Therefore, pursuant to 5 U.S.C. 605(b), this final rule is exempt from the final regulatory flexibility analysis requirements of section 604.
The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C. 1532, that agencies prepare an assessment of anticipated costs and benefits before issuing any rule that may result in the expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more (adjusted annually for inflation) in any one year. This final rule will have no such effect on State, local, and tribal governments, or on the private sector.
This final rule contains no provisions constituting a collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3521).
The Catalog of Federal Domestic Assistance numbers and titles for the programs affected by this document are 64.005, Grants to States for Construction of State Home Facilities; 64.024, VA Homeless Providers Grant and Per Diem Program; 64.026, Veterans State Adult Day Health Care; 64.033, VA Supportive Services for Veteran Families Program; 64.034, VA Assistance to United States Paralympic Integrated Adaptive Sports Program; 64.037, VA U.S. Paralympics Monthly Assistance Allowance Program; 64.038, Grants for the Rural Veterans Coordination Pilot; 64.100, Automobiles and Adaptive Equipment for Certain Disabled Veterans and Members of the Armed Forces; 64.201, National Cemeteries; and 64.203, State Cemetery Grants.
The Secretary of Veterans Affairs, or designee, approved this document and authorized the undersigned to sign and submit the document to the Office of the Federal Register for publication electronically as an official document of the Department of Veterans Affairs. Robert L. Nabors II, Chief of Staff, Department of Veterans Affairs, approved this document on July 7, 2015, for publication.
Administrative practice and procedure, Grant programs—health, Grant programs—veterans, Health care, Health facilities, Nursing homes, Reporting and recordkeeping requirements, Travel and transportation expenses, Veterans.
Cemeteries, Grant programs—veterans, Veterans.
Administrative practice and procedure, Drug abuse, Grant programs, Loan programs, Reporting and recordkeeping requirements.
Uniform Administrative Requirements for Grants and Agreements.
Administrative practice and procedure, Day care, Grant programs—health, Grant programs—veterans, Health care, Health facilities, Nursing homes, Reporting and recordkeeping requirements, Veterans.
Administrative practice and procedure, Grant programs—health, Grant programs—veterans, Health care, Health facilities, Health professions, Nursing homes, Reporting and recordkeeping requirements, Scholarships and fellowships, Veterans.
Administrative practice and procedure, Day care, Grant programs—health, Grant programs—veterans, Health care, Health facilities, Nursing homes, Reporting and recordkeeping requirements, Veterans.
Administrative practice and procedure, Alcohol abuse, Alcoholism, Drug abuse, Grant programs—health, Grant programs—veterans, Health care, Health facilities, Homeless, Mental
Administrative practice and procedure, Claims, Grant programs—health, Grant programs—social services, Grant programs—transportation, Grant programs—veterans, Grants—housing and community development, Heath care, Homeless, Housing, Housing assistance payments, Indian—lands, Individuals with disabilities, Low and moderate income housing, Manpower training program, Medicare, Medicaid, Public assistance programs, Public housing, Relocation assistance, Rent subsidies, Reporting and recordkeeping requirements, Rural areas, Social security, Supplemental security income (SSI), Travel and transportation expenses, Unemployment compensation, Veterans.
Administrative practice and procedure, Disability benefits, Claims, Grant programs—health, Grant programs—veterans, Health care, Health records, Reporting and recordkeeping requirements, Veterans.
For the reasons set forth in the preamble, VA amends 38 CFR parts 17, 39, 48, 49, 51, 52, 53, 59, 61, 62, and 64 as follows:
38 U.S.C. 501, and as noted in specific sections.
(b)
25 U.S.C. 450b(1); 38 U.S.C. 101, 501, 2408, 2411, 3765.
41 U.S.C. 701,
38 U.S.C. 101, 501, 1710, 1720, 1741-1743, and as stated in specific sections.
38 U.S.C. 101, 501, 1741-1743, unless otherwise noted.
38 U.S.C. 101, 501, 1744.
38 U.S.C. 101, 501, 1710, 1742, 8105, 8131-8137.
38 U.S.C. 501, 2001, 2002, 2011, 2012, 2061, 2064.
(b) * * *
(3) * * *
(i) Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards under 2 CFR part 200;
(a) All recipients must comply with applicable requirements of the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards under 2 CFR part 200.
(b) All entities receiving assistance under this part must use a financial management system that follows generally accepted accounting principles and meets the requirements set forth under 2 CFR part 200. All recipients must implement the requirements of 2 CFR part 200 when determining costs reimbursable under all awards issued under this part.
38 U.S.C. 501, 2044, and as noted in specific sections.
The revision reads as follows:
(a) Grantees must comply with applicable requirements of the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards under 2 CFR part 200.
38 U.S.C. 501, 523
(b) * * *
(2) Abide by the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards under 2 CFR part 200, and 2 CFR parts 25 and 170, if applicable.
Environmental Protection Agency (EPA).
Final rule.
This regulation establishes tolerances for residues of sedaxane as a seed treatment for cotton, undelinted seed; cotton, gin byproducts; and beet, sugar. Syngenta Crop Protection, LLC requested these tolerances under the Federal Food, Drug, and Cosmetic Act (FFDCA).
This regulation is effective July 22, 2015. Objections and requests for hearings must be received on or before September 21, 2015, and must be filed in accordance with the instructions provided in 40 CFR part 178 (see also Unit I.C. of the
The docket for this action, identified by docket identification (ID) number EPA-HQ-OPP-2014-0354, is available at
Susan Lewis, Registration Division (7505P), Office of Pesticide Programs,
You may be potentially affected by this action if you are an agricultural producer, food manufacturer, or pesticide manufacturer. The following list of North American Industrial Classification System (NAICS) codes is not intended to be exhaustive, but rather provides a guide to help readers determine whether this document applies to them. Potentially affected entities may include:
• Crop production (NAICS code 111).
• Animal production (NAICS code 112).
• Food manufacturing (NAICS code 311).
• Pesticide manufacturing (NAICS code 32532).
You may access a frequently updated electronic version of EPA's tolerance regulations at 40 CFR part 180 through the Government Printing Office's e-CFR site at
Under FFDCA section 408(g), 21 U.S.C. 346a, any person may file an objection to any aspect of this regulation and may also request a hearing on those objections. You must file your objection or request a hearing on this regulation in accordance with the instructions provided in 40 CFR part 178. To ensure proper receipt by EPA, you must identify docket ID number EPA-HQ-OPP-2014-0354 in the subject line on the first page of your submission. All objections and requests for a hearing must be in writing, and must be received by the Hearing Clerk on or before September 21, 2015. Addresses for mail and hand delivery of objections and hearing requests are provided in 40 CFR 178.25(b).
In addition to filing an objection or hearing request with the Hearing Clerk as described in 40 CFR part 178, please submit a copy of the filing (excluding any Confidential Business Information (CBI)) for inclusion in the public docket. Information not marked confidential pursuant to 40 CFR part 2 may be disclosed publicly by EPA without prior notice. Submit the non-CBI copy of your objection or hearing request, identified by docket ID number EPA-HQ-OPP-2014-0354, by one of the following methods:
•
•
•
Additional instructions on commenting or visiting the docket, along with more information about dockets generally, is available at
In the
Based upon review of the data supporting the petition, EPA has altered the commodity name from “beet, sugar” to “beet, sugar, roots”. The reason for this change is explained in Unit IV.D.
Section 408(b)(2)(A)(i) of FFDCA allows EPA to establish a tolerance (the legal limit for a pesticide chemical residue in or on a food) only if EPA determines that the tolerance is “safe.” Section 408(b)(2)(A)(ii) of FFDCA defines “safe” to mean that “there is a reasonable certainty that no harm will result from aggregate exposure to the pesticide chemical residue, including all anticipated dietary exposures and all other exposures for which there is reliable information.” This includes exposure through drinking water and in residential settings, but does not include occupational exposure. Section 408(b)(2)(C) of FFDCA requires EPA to give special consideration to exposure of infants and children to the pesticide chemical residue in establishing a tolerance and to “ensure that there is a reasonable certainty that no harm will result to infants and children from aggregate exposure to the pesticide chemical residue. . . .”
Consistent with FFDCA section 408(b)(2)(D), and the factors specified in FFDCA section 408(b)(2)(D), EPA has reviewed the available scientific data and other relevant information in support of this action. EPA has sufficient data to assess the hazards of and to make a determination on aggregate exposure for sedaxane including exposure resulting from the tolerances established by this action. EPA's assessment of exposures and risks associated with sedaxane follows.
EPA has evaluated the available toxicity data and considered its validity, completeness, and reliability as well as the relationship of the results of the studies to human risk. EPA has also considered available information concerning the variability of the sensitivities of major identifiable subgroups of consumers, including infants and children. The toxicological effects reported in the submitted animal studies such as mitochondrial disintegration and glycogen depletion in the liver are consistent with the pesticidal mode of action also being the mode of toxic action in mammals. The rat is the most sensitive species tested, and the main target tissue for sedaxane is the liver. Sedaxane also caused thyroid hypertrophy/hyperplasia. In the acute neurotoxicity (ACN) and sub-chronic neurotoxicity (SCN) studies, sedaxane caused decreased activity, decreased muscle tone, decreased rearing, and decreased grip strength. There are indications of reproductive toxicity in rats such as decreased follicle counts, but these effects did not result in reduced fertility. Offspring effects in the reproduction study occurred at the same doses causing parental effects, and do not indicate any quantitative or qualitative increase in sensitivity in rat pups. In the rat, no adverse effects in fetuses were seen in developmental toxicity studies at maternally toxic
Specific information on the studies received and the nature of the adverse effects caused by sedaxane as well as the no-observed-adverse-effect-level (NOAEL) and the lowest-observed-adverse-effect-level (LOAEL) from the toxicity studies can be found at
Once a pesticide's toxicological profile is determined, EPA identifies toxicological points of departure (POD) and levels of concern to use in evaluating the risk posed by human exposure to the pesticide. For hazards that have a threshold below which there is no appreciable risk, the toxicological POD is used as the basis for derivation of reference values for risk assessment. PODs are developed based on a careful analysis of the doses in each toxicological study to determine the dose at which no adverse effects are observed (the NOAEL) and the lowest dose at which adverse effects of concern are identified (the LOAEL). Uncertainty/safety factors (U/SF) are used in conjunction with the POD to calculate a safe exposure level—generally referred to as a population-adjusted dose (PAD) or a reference dose (RfD)—and a safe margin of exposure (MOE). For non-threshold risks, the Agency assumes that any amount of exposure will lead to some degree of risk. Thus, the Agency estimates risk in terms of the probability of an occurrence of the adverse effect expected in a lifetime. For more information on the general principles EPA uses in risk characterization and a complete description of the risk assessment process, see
A summary of the toxicological endpoints for sedaxane used for human risk assessment is shown in the Table of this unit.
1.
i.
Such effects were identified for sedaxane. In estimating acute dietary exposure, EPA used food consumption information from the United States Department of Agriculture (USDA) National Health and Nutrition Examination Survey, What We Eat in America, (NHANES/WWEIA) conducted from 2003-2008. As to residue levels in
ii.
iii.
iv.
Section 408(b)(2)(E) of FFDCA authorizes EPA to use available data and information on the anticipated residue levels of pesticide residues in food and the actual levels of pesticide residues that have been measured in food. If EPA relies on such information, EPA must require pursuant to FFDCA section 408(f)(1) that data be provided 5 years after the tolerance is established, modified, or left in effect, demonstrating that the levels in food are not above the levels anticipated. For the present action, EPA will issue such data call-ins as are required by FFDCA section 408(b)(2)(E) and authorized under FFDCA section 408(f)(1). Data will be required to be submitted no later than 5 years from the date of issuance of these tolerances.
Section 408(b)(2)(F) of FFDCA states that the Agency may use data on the actual percent of food treated for assessing chronic dietary risk only if:
• Condition a: The data used are reliable and provide a valid basis to show what percentage of the food derived from such crop is likely to contain the pesticide residue.
• Condition b: The exposure estimate does not underestimate exposure for any significant subpopulation group.
• Condition c: Data are available on pesticide use and food consumption in a particular area, the exposure estimate does not understate exposure for the population in such area.
In addition, the Agency must provide for periodic evaluation of any estimates used. To provide for the periodic evaluation of the estimate of PCT as required by FFDCA section 408(b)(2)(F), EPA may require registrants to submit data on PCT. The Agency estimated the PCT for existing uses as follows: For chronic and cancer dietary exposure assessment, 100 PCT was assumed for all commodities except for soybeans (51%), wheat (32%) and potato (67%), which incorporated average PCT estimates.
In most cases, EPA uses available data from United States Department of Agriculture/National Agricultural Statistics Service (USDA/NASS), proprietary market surveys, and the National Pesticide Use Database for the chemical/crop combination for the most recent 6-7 years. EPA uses an average PCT for chronic dietary risk analysis. The average PCT figure for each existing use is derived by combining available public and private market survey data for that use, averaging across all observations, and rounding to the nearest 5%, except for those situations in which the average PCT is less than one. In those cases, 1% is used as the average PCT and 2.5% is used as the maximum PCT. EPA uses a maximum PCT for acute dietary risk analysis. The maximum PCT figure is the highest observed maximum value reported within the recent 6 years of available public and private market survey data for the existing use and rounded up to the nearest multiple of 5%.
The Agency believes that the three conditions discussed in Unit III.C.1.iv. have been met. With respect to Condition a, PCT estimates are derived from Federal and private market survey data, which are reliable and have a valid basis. The Agency is reasonably certain that the percentage of the food treated is not likely to be an underestimation. As to Conditions b and c, regional consumption information and consumption information for significant subpopulations is taken into account through EPA's computer-based model for evaluating the exposure of significant subpopulations including several regional groups. Use of this consumption information in EPA's risk assessment process ensures that EPA's exposure estimate does not understate exposure for any significant subpopulation group and allows the Agency to be reasonably certain that no regional population is exposed to residue levels higher than those estimated by the Agency. Other than the data available through national food consumption surveys, EPA does not have available reliable information on the regional consumption of food to which sedaxane may be applied in a particular area.
2.
Based on the FQPA Index Reservoir Screening Tool (FIRST) and Pesticide Root Zone Model Ground Water (PRZM GW), the estimated drinking water concentrations (EDWCs) of sedaxane for acute exposures are estimated to be 4.1 parts per billion (ppb) for surface water and 22.0 ppb for ground water, for chronic exposures and cancer assessments are estimated to be 1.2 ppb for surface water and 19.3 ppb for ground water.
Modeled estimates of drinking water concentrations were directly entered into the dietary exposure model. For acute dietary risk assessment, the water concentration value of 22.0 ppb was used to assess the contribution to drinking water. For chronic and cancer dietary risk assessment, the water concentration of value 19.3 ppb was used to assess the contribution to drinking water.
3.
4.
1.
2.
3.
i. The toxicity database for sedaxane is complete.
ii. There is no indication that sedaxane is a neurotoxic chemical and there is no need for a developmental neurotoxicity study or additional UFs to account for neurotoxicity. Although sedaxane caused changes in apical endpoints such as decreased activity, decreased muscle tone, decreased rearing and decreased grip strength in the ACN and SCN studies, EPA believes these effects do not support a finding that sedaxane is a neurotoxicant. The observed effects in the ACN and SCN studies were likely secondary to inhibition of mitochondrial energy production caused by sedaxane. Furthermore, there was no corroborative neuro-histopathology demonstrated in any study, even at the highest doses tested (
iii. As discussed in Unit III.D.2., there is no evidence that sedaxane results in increased susceptibility in
iv. There are no residual uncertainties identified in the exposure databases. The dietary food exposure assessments are highly conservative (acute) or only partially refined (chronic), resulting in high-end estimates of dietary food exposure. EPA made conservative (protective) assumptions in the ground and surface water modeling used to assess exposure to sedaxane in drinking water. These assessments will not underestimate the exposure and risks posed by sedaxane.
EPA determines whether acute and chronic dietary pesticide exposures are safe by comparing aggregate exposure estimates to the acute PAD (aPAD) and chronic PAD (cPAD). For linear cancer risks, EPA calculates the lifetime probability of acquiring cancer given the estimated aggregate exposure. Short-, intermediate-, and chronic-term risks are evaluated by comparing the estimated aggregate food, water, and residential exposure to the appropriate PODs to ensure that an adequate MOE exists.
1.
2.
3.
A short- and intermediate-term adverse effect was identified; however, sedaxane is not registered for any use patterns that would result in short- or intermediate-term residential exposure. Short- and intermediate-term risk is assessed based on short- and intermediate-term residential exposure plus chronic dietary exposure. Because there is no short- or intermediate-term residential exposure and chronic dietary exposure has already been assessed under the appropriately protective cPAD (which is at least as protective as the POD used to assess short-term risk), no further assessment of short- and intermediate-term risk is necessary, and EPA relies on the chronic dietary risk assessment for evaluating short- and intermediate-term risk for sedaxane.
4.
5.
Adequate enforcement methodology (liquid chromatography/tandem mass spectrometry (LC/MS/MS)) is available to enforce the tolerance expression. A modification of the Quick, Easy, Cheap, Effective, Rugged, and Safe (QuEChERS) method was developed for the determination of residues of sedaxane (as its isomers SYN508210 and SYN508211) in/on various crops. The sedaxane isomers (SYN508210 and SYN508211) are quantitatively determined by LC/MS/MS. The validated limit of quantitation (LOQ) reported in the method is 0.005 ppm for both sedaxane isomers. A successful independent laboratory validation (ILV) study was also conducted on the modified QuEChERS method using samples of wheat green forage and wheat straw fortified with SYN508210 and SYN508211 at 0.005 and 0.05 ppm. The analytical standard for sedaxane, with an expiration date of February 28, 2018, is currently available in the EPA National Pesticide Standards Repository.
The method may be requested from: Chief, Analytical Chemistry Branch, Environmental Science Center, 701 Mapes Rd., Ft. Meade, MD 20755-5350; telephone number: (410) 305-2905; email address:
In making its tolerance decisions, EPA seeks to harmonize U.S. tolerances with international standards whenever possible, consistent with U.S. food safety standards and agricultural practices. EPA considers the international maximum residue limits (MRLs) established by the Codex Alimentarius Commission (Codex), as required by FFDCA section 408(b)(4). The Codex Alimentarius is a joint United Nations Food and Agriculture Organization/World Health Organization food standards program, and it is recognized as an international food safety standards-setting organization in trade agreements to which the United States is a party. EPA may establish a tolerance that is different from a Codex MRL; however, FFDCA section 408(b)(4) requires that EPA explain the reasons for departing from the Codex level. The Codex has not established MRLs for sedaxane.
Although the petitioner sought a tolerance for the commodity name “beet, sugar”, EPA is establishing a tolerance for “beet, sugar, roots” to be consistent with the general food and feed commodity vocabulary EPA uses for tolerances and exemptions.
Therefore, tolerances are established for residues of sedaxane,
This action establishes tolerances under FFDCA section 408(d) in response to a petition submitted to the Agency. The Office of Management and Budget (OMB) has exempted these types of actions from review under Executive Order 12866, entitled “Regulatory Planning and Review” (58 FR 51735, October 4, 1993). Because this action has been exempted from review under Executive Order 12866, this action is not subject to Executive Order 13211, entitled “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355, May 22, 2001) or Executive Order 13045, entitled “Protection of Children from Environmental Health Risks and Safety Risks” (62 FR 19885, April 23, 1997). This action does not contain any information collections subject to OMB approval under the Paperwork Reduction Act (PRA) (44 U.S.C. 3501
Since tolerances and exemptions that are established on the basis of a petition under FFDCA section 408(d), such as the tolerances in this final rule, do not require the issuance of a proposed rule, the requirements of the Regulatory Flexibility Act (RFA) (5 U.S.C. 601
This action directly regulates growers, food processors, food handlers, and food retailers, not States or tribes, nor does this action alter the relationships or distribution of power and responsibilities established by Congress in the preemption provisions of FFDCA section 408(n)(4). As such, the Agency has determined that this action will not have a substantial direct effect on States or tribal governments, on the relationship between the national government and the States or tribal governments, or on the distribution of power and responsibilities among the various levels of government or between the Federal Government and Indian tribes. Thus, the Agency has determined that Executive Order 13132, entitled “Federalism” (64 FR 43255, August 10, 1999) and Executive Order 13175, entitled “Consultation and Coordination with Indian Tribal Governments” (65 FR 67249, November 9, 2000) do not apply to this action. In addition, this action does not impose any enforceable duty or contain any unfunded mandate as described under Title II of the Unfunded Mandates Reform Act (UMRA) (2 U.S.C. 1501
This action does not involve any technical standards that would require Agency consideration of voluntary consensus standards pursuant to section 12(d) of the National Technology Transfer and Advancement Act (NTTAA) (15 U.S.C. 272 note).
Pursuant to the Congressional Review Act (5 U.S.C. 801
Environmental protection, Administrative practice and procedure, Agricultural commodities, Pesticides and pests, Reporting and recordkeeping requirements.
Therefore, 40 CFR chapter I is amended as follows:
21 U.S.C. 321(q), 346a and 371.
(a) * * *
Environmental Protection Agency (EPA).
Final rule.
This regulation establishes tolerances for residues of novaluron in or on multiple commodities and removes several existing tolerances which are identified and discussed later in this document. This regulation additionally revises existing tolerances in or on vegetable, cucurbit, group 9; and plum, prune, dried. Interregional Research Project Number 4 (IR-4) requested these tolerances under the Federal Food, Drug, and Cosmetic Act (FFDCA).
This regulation is effective July 22, 2015. Objections and requests for hearings must be received on or before September 21, 2015, and must be filed in accordance with the instructions provided in 40 CFR part 178 (see also Unit I.C. of the
The docket for this action, identified by docket identification (ID) number EPA-HQ-OPP-2014-0232, is available at
Susan Lewis, Registration Division (7505P), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave. NW., Washington, DC 20460-0001; main telephone number: (703) 305-7090; email address:
You may be potentially affected by this action if you are an agricultural producer, food manufacturer, or pesticide manufacturer. The following list of North American Industrial Classification System (NAICS) codes is not intended to be exhaustive, but rather provides a guide to help readers determine whether this document applies to them. Potentially affected entities may include:
• Crop production (NAICS code 111).
• Animal production (NAICS code 112).
• Food manufacturing (NAICS code 311).
• Pesticide manufacturing (NAICS code 32532).
You may access a frequently updated electronic version of EPA's tolerance regulations at 40 CFR part 180 through the Government Printing Office's e-CFR site at
Under FFDCA section 408(g), 21 U.S.C. 346a, any person may file an objection to any aspect of this regulation and may also request a hearing on those objections. You must file your objection or request a hearing on this regulation in accordance with the instructions provided in 40 CFR part 178. To ensure proper receipt by EPA, you must identify docket ID number EPA-HQ-OPP-2014-0232 in the subject line on the first page of your submission. All objections and requests for a hearing must be in writing, and must be received by the Hearing Clerk on or before September 21, 2015. Addresses for mail and hand delivery of objections and hearing requests are provided in 40 CFR 178.25(b).
In addition to filing an objection or hearing request with the Hearing Clerk as described in 40 CFR part 178, please submit a copy of the filing (excluding any Confidential Business Information (CBI)) for inclusion in the public docket. Information not marked confidential pursuant to 40 CFR part 2 may be disclosed publicly by EPA without prior notice. Submit the non-CBI copy of your objection or hearing request, identified by docket ID number EPA-HQ-OPP-2014-0232, by one of the following methods:
•
•
•
Additional instructions on commenting or visiting the docket, along with more information about dockets generally, is available at
In the
Upon approval of the petitioned-for tolerances listed above, the petition proposed to remove the following established tolerances for residues of novaluron from 40 CFR 180.598: Bean, succulent, snap at 0.60 ppm; bean, dry, seed at 0.30 ppm; cherry at 8.0 ppm; fruit, pome, group 11 at 2.0 ppm; fruit, stone, group 12, except cherry at 1.9 ppm; vegetable, fruiting, group 8 at 1.0 ppm; cocona at 1.0 ppm; African eggplant at 1.0 ppm; pea eggplant at 1.0 ppm; scarlet eggplant at 1.0 ppm; goji berry at 1.0 ppm; garden huckleberry at 1.0 ppm; martynia at 1.0 ppm; naranjilla at 1.0 ppm; okra at 1.0 ppm; roselle at 1.0 ppm; sunberry at 1.0 ppm; bush tomato at 1.0 ppm; currant tomato at 1.0 ppm; and tree tomato at 1.0 ppm. These tolerances were requested for removal because they will be superseded by establishment of the petitioned-for tolerances. That document referenced a summary of the petition prepared on behalf of IR-4 by Makhteshim-Agan of North America, Inc., the registrant, which is available in the docket,
Based upon review of the data supporting the petition, EPA has revised several proposed tolerances. EPA has also determined that the previously established tolerances in or on vegetable, cucurbit, group 9 and plum, prune, dried should be revised. Finally, EPA determined that establishing a tolerance on bean is not appropriate; rather, a tolerance should be established on bean, succulent and the previously established tolerance on bean, dry, seed should not be removed. The reasons for these changes are explained in Unit IV.D.
Section 408(b)(2)(A)(i) of FFDCA allows EPA to establish a tolerance (the legal limit for a pesticide chemical residue in or on a food) only if EPA determines that the tolerance is “safe.” Section 408(b)(2)(A)(ii) of FFDCA defines “safe” to mean that “there is a reasonable certainty that no harm will result from aggregate exposure to the pesticide chemical residue, including all anticipated dietary exposures and all other exposures for which there is reliable information.” This includes exposure through drinking water and in residential settings, but does not include occupational exposure. Section 408(b)(2)(C) of FFDCA requires EPA to give special consideration to exposure of infants and children to the pesticide chemical residue in establishing a tolerance and to “ensure that there is a reasonable certainty that no harm will result to infants and children from aggregate exposure to the pesticide chemical residue . . . .”
Consistent with FFDCA section 408(b)(2)(D), and the factors specified in FFDCA section 408(b)(2)(D), EPA has reviewed the available scientific data and other relevant information in support of this action. EPA has sufficient data to assess the hazards of and to make a determination on aggregate exposure for novaluron including exposure resulting from the tolerances established by this action. EPA's assessment of exposures and risks associated with novaluron follows.
EPA has evaluated the available toxicity data and considered its validity, completeness, and reliability as well as the relationship of the results of the studies to human risk. EPA has also considered available information concerning the variability of the sensitivities of major identifiable subgroups of consumers, including infants and children.
In subchronic and chronic toxicity studies, novaluron primarily produced hematotoxic effects such as methemoglobinemia, decreased hemoglobin, decreased hematocrit, decreased red blood cells (RBCs) (or erythrocytes) and increased reticulocyte counts that were associated with compensatory erythropoiesis. Increased spleen weights or hemosiderosis in the spleen were considered to be due to enhanced removal of damaged erythrocytes and not to a direct immunotoxic effect.
There was no maternal or developmental toxicity seen in the rat and rabbit developmental toxicity studies up to the limit doses. In the 2-generation reproductive toxicity study in rats, both parental and offspring toxicity (increased spleen weights) were observed at the same dose. Reproductive toxicity, including decreases in epididymal sperm counts and increased age at preputial separation in the F1 generation, was observed at a higher dose than the increased spleen weights and were consistent with the primary effects in the database.
Clinical signs of neurotoxicity (piloerection, irregular breathing), changes in functional observational battery (FOB) parameters (increased head swaying, abnormal gait), and neuropathology (sciatic and tibial nerve degeneration) were seen in the rat acute neurotoxicity study at the limit dose. However, no signs of neurotoxicity or neuropathology were observed in the subchronic neurotoxicity study in rats at similar doses or in any other subchronic or chronic toxicity study in rats, mice, or dogs. In the submitted immunotoxicity study, the only sign of potential immunotoxicity for novaluron was a decreased anti-sheep red blood cell (anti-SRBC) response at twice the limit dose in female rats. There was no evidence of carcinogenic potential in either the rat or mouse carcinogenicity studies, and there was also no concern for genotoxicity or mutagenicity.
Specific information on the studies received and the nature of the adverse effects caused by novaluron as well as the no-observed-adverse-effect-level (NOAEL) and the lowest-observed-adverse-effect-level (LOAEL) from the toxicity studies can be found at
Once a pesticide's toxicological profile is determined, EPA identifies toxicological points of departure (POD) and levels of concern to use in evaluating the risk posed by human exposure to the pesticide. For hazards that have a threshold below which there is no appreciable risk, the toxicological POD is used as the basis for derivation of reference values for risk assessment. PODs are developed based on a careful analysis of the doses in each toxicological study to determine the dose at which no adverse effects are observed (the NOAEL) and the lowest dose at which adverse effects of concern are identified (the LOAEL). Uncertainty/safety factors are used in conjunction with the POD to calculate a safe exposure level—generally referred to as a population-adjusted dose (PAD) or a reference dose (RfD)—and a safe margin of exposure (MOE). For non-threshold risks, the Agency assumes that any amount of exposure will lead to some degree of risk. Thus, the Agency estimates risk in terms of the probability of an occurrence of the adverse effect expected in a lifetime. For more information on the general principles
A summary of the toxicological endpoints for novaluron used for human risk assessment is shown in Table 1 of this unit.
1.
i.
ii.
iii.
iv.
Section 408(b)(2)(F) of FFDCA states that the Agency may use data on the actual percent of food treated for assessing chronic dietary risk only if:
• Condition a: The data used are reliable and provide a valid basis to
• Condition b: The exposure estimate does not underestimate exposure for any significant subpopulation group.
• Condition c: Data are available on pesticide use and food consumption in a particular area, the exposure estimate does not understate exposure for the population in such area.
In addition, the Agency must provide for periodic evaluation of any estimates used. To provide for the periodic evaluation of the estimate of PCT as required by FFDCA section 408(b)(2)(F), EPA may require registrants to submit data on PCT.
The Agency estimated the average PCT for existing uses as follows:
Apple, 10%; blueberry, 1%; cabbage, 5%; cauliflower, 2.5%; cotton, 2.5%; dry beans, 1%; pear, 15%; pepper, 2.5%; potato, 2.5%; strawberry, 35%; and tomato, 2.5%.
In most cases, EPA uses available data from United States Department of Agriculture/National Agricultural Statistics Service (USDA/NASS), proprietary market surveys, and the National Pesticide Use Database for the chemical/crop combination for the most recent 6 to 7 years. EPA uses an average PCT for chronic dietary risk analysis. The average PCT figure for each existing use is derived by combining available public and private market survey data for that use, averaging across all observations, and rounding to the nearest 5%, except for those situations in which the average PCT is less than one. In those cases, 1% is used as the average PCT and 2.5% is used as the maximum PCT. EPA uses a maximum PCT for acute dietary risk analysis. The maximum PCT figure is the highest observed maximum value reported within the recent 6 years of available public and private market survey data for the existing use and rounded up to the nearest multiple of 5%.
The Agency estimated the PCT for new uses as follows: Grain sorghum, 2%; and sweet corn, 36%.
EPA estimates PCTn for novaluron based on the PCT of the dominant pesticide (
This estimated PCTn, based on the average PCT of the market leader, is appropriate for use in the chronic dietary risk assessment. This method of estimating a PCT for a new use of a registered pesticide or a new pesticide produces a high-end estimate that is unlikely, in most cases, to be exceeded during the initial five years of actual use. The predominant factors that bear on whether the estimated PCTn could be exceeded are: The extent of pest pressure on the crops in question; the pest spectrum of the new pesticide in comparison with the market leaders as well as whether the market leaders are well-established for this use; and resistance concerns with the market leaders.
Novaluron specifically targets lepidopterous insects, which are not key pests of sorghum but are key pests of sweet corn. However, novaluron has a relatively narrow spectrum of pest activity when compared to the market leader insecticides. In addition, there are no resistance or pest pressure issues as indicated in Section 18 Emergency Exemption requests for use of novaluron on sorghum or sweet corn. All information currently available has been considered for novaluron use on sorghum and sweet corn, and it is the opinion of EPA that it is unlikely that actual PCT for novaluron will exceed the estimated PCT for new uses during the next five years.
The Agency believes that the three conditions discussed in Unit III.C.1.iv. have been met. With respect to Condition a, PCT estimates are derived from Federal and private market survey data, which are reliable and have a valid basis. The Agency is reasonably certain that the percentage of the food treated is not likely to be an underestimation. As to Conditions b and c, regional consumption information and consumption information for significant subpopulations is taken into account through EPA's computer-based model for evaluating the exposure of significant subpopulations including several regional groups. Use of this consumption information in EPA's risk assessment process ensures that EPA's exposure estimate does not understate exposure for any significant subpopulation group and allows the Agency to be reasonably certain that no regional population is exposed to residue levels higher than those estimated by the Agency. Other than the data available through national food consumption surveys, EPA does not have available reliable information on the regional consumption of food to which novaluron may be applied in a particular area.
2.
Based on the Pesticide Root Zone Model/Exposure Analysis Modeling System (PRZM/EXAMS), the Screening Concentration in Ground Water (SCI-GROW), and Pesticide Root Zone Model Ground Water (PRZM GW) models, the combined EDWCs of novaluron, chlorophenyl urea, and chloroaniline for chronic exposures are estimated to be 16.7 ppb for surface water and 77.8 ppb for groundwater.
Modeled estimates of drinking water concentrations were directly entered into the dietary exposure model. For chronic dietary risk assessment, the water concentration of value 77.8 ppb was used to assess the contribution to drinking water.
3.
Novaluron is currently registered for the following uses that could result in residential exposures: Indoor and outdoor crack and crevice or perimeter applications in residential areas and their immediate surroundings, including homes and apartment buildings; on modes of transportation; and as a spot-on use for pets. EPA assessed residential exposure using the following assumptions:
Adult handlers were assessed for potential short-term inhalation exposures from mixing, loading, and
Further information regarding EPA standard assumptions and generic inputs for residential exposures may be found at
4.
EPA has not found novaluron to share a common mechanism of toxicity with any other substances, and novaluron does not appear to produce a toxic metabolite produced by other substances. For the purposes of this tolerance action, therefore, EPA has assumed that novaluron does not have a common mechanism of toxicity with other substances. For information regarding EPA's efforts to determine which chemicals have a common mechanism of toxicity and to evaluate the cumulative effects of such chemicals, see EPA's Web site at
1.
2.
3.
i. The toxicity database for novaluron is complete.
ii. Acute and subchronic rat neurotoxicity studies were performed for novaluron. The clinical signs of neurotoxicity, changes in FOB parameters, and neuropathology were seen in the acute neurotoxicity study at the limit dose (2,000 mg/kg/day) only and were not reproduced at similar, repeated doses in the subchronic neurotoxicity study. In addition, no evidence of neuropathology was observed in subchronic and chronic toxicity studies in rats, mice, or dogs. Therefore, novaluron is not considered a neurotoxic chemical and there is no need for a developmental neurotoxicity study or additional UFs to account for neurotoxicity.
iii. There is no evidence that novaluron results in increased susceptibility in
iv. There are no residual uncertainties identified in the exposure databases. The chronic dietary food exposure assessment was performed using average field trial residues, anticipated residues for livestock commodities, average PCT and PCTn data for some commodities, and empirical and default processing factors. For the remaining food commodities, 100 PCT was assumed. The registered food handling use was also incorporated into the dietary assessment. EPA made conservative (protective) assumptions in the ground and surface water modeling used to assess exposure to novaluron in drinking water. EPA used similarly conservative assumptions to assess postapplication exposure of children as well as incidental oral exposure of toddlers. These assessments will not underestimate the exposure and risks posed by novaluron.
EPA determines whether acute and chronic dietary pesticide exposures are safe by comparing aggregate exposure estimates to the acute PAD (aPAD) and chronic PAD (cPAD). For linear cancer risks, EPA calculates the lifetime probability of acquiring cancer given the estimated aggregate exposure. Short-, intermediate-, and chronic-term risks are evaluated by comparing the estimated aggregate food, water, and residential exposure to the appropriate PODs to ensure that an adequate MOE exists.
1.
2.
3.
Using the exposure assumptions described in this unit for short-term exposures, EPA has concluded the combined short-term food, water, and residential exposures result in aggregate MOEs of 1,560 for adults and 350 for children 1 to <2 years old. Because EPA's level of concern for novaluron is a MOE of 100 or below, these MOEs are not of concern.
4.
Using the exposure assumptions described in this unit for intermediate- and long-term exposures, EPA has concluded that the combined intermediate- and long-term food, water, and residential exposures result in an aggregate MOE of 530 for children 1 to <2 years old. For adults, since there is no dermal endpoint and inhalation exposure is expected to be negligible, the average dietary consumption (food and drinking water) exposure estimate is representative of intermediate- and long-term aggregate risk, and results in an MOE of 1640. Because EPA's level of concern for novaluron is a MOE of 100 or below, these MOEs are not of concern.
5.
6.
Adequate enforcement methodologies, gas chromatography/electron-capture detection (GC/ECD) and high-performance liquid chromatography/ultraviolet (HPLC/UV), are available to enforce the tolerance expression.
The methods may be requested from: Chief, Analytical Chemistry Branch, Environmental Science Center, 701 Mapes Rd., Ft. Meade, MD 20755-5350; telephone number: (410) 305-2905; email address:
In making its tolerance decisions, EPA seeks to harmonize U.S. tolerances with international standards whenever possible, consistent with U.S. food safety standards and agricultural practices. EPA considers the international maximum residue limits (MRLs) established by the Codex Alimentarius Commission (Codex), as required by FFDCA section 408(b)(4). The Codex Alimentarius is a joint United Nations Food and Agriculture Organization/World Health Organization food standards program, and it is recognized as an international food safety standards-setting organization in trade agreements to which the United States is a party. EPA may establish a tolerance that is different from a Codex MRL; however, FFDCA section 408(b)(4) requires that EPA explain the reasons for departing from the Codex level.
The Codex has established MRLs for novaluron in or on common beans (pods and/or immature seeds) at 0.7 ppm; pome fruit at 3 ppm; cucurbit vegetables at 0.2 ppm; and prunes at 3.0 ppm. EPA is establishing tolerances in or on succulent bean at 0.70 ppm; pome fruit crop group 11-10 at 3.0 ppm; cucurbit vegetable crop group 9 at 0.20 ppm; and dried prune at 3.0 ppm in order to harmonize with Codex. The Codex has additionally established a tolerance in or on fruiting vegetables other than cucurbits at 0.7 ppm and stone fruits at 7 ppm. Because EPA is recommending a tolerance in or on fruiting vegetables crop group 8-10 (1.0 ppm) that is higher than Codex, EPA cannot harmonize this tolerance. Residue data for greenhouse tomatoes supports the 1.0 ppm tolerance for the group 8-10 tolerance.
The data supporting the EPA petition result in stone fruit tolerances that are either higher (cherry subgroup 12-12A at 8.0 ppm) or much lower (peach subgroup 12-12B and plum subgroup 12-12C at 1.9 ppm) than the established Codex MRL for stone fruit at 7 ppm. EPA notes that the stone fruit tolerances are not harmonized with associated Codex MRLs on these commodities because it has been determined that the major export market for these commodities is Canada. Therefore, in order to maintain harmonization of U.S. tolerances and Canadian MRLs for these commodities, the EPA is establishing these subgroup tolerances at the levels that align with the Canadian MRLs. No Codex MRLs have been established for residues of novaluron in or on avocado or carrot.
One comment was received to the batched Notice of Filing that provided brief and general concerns about toxins and potential impacts to bees, but the commenter did not cite a specific petition within the Notice. The Agency has received similar comments from this commenter on numerous previous occasions. Refer to
The Agency was petitioned to establish a tolerance of novaluron in or on plum subgroup 12-12C. As a part of that request, the Agency reviewed the existing tolerance on dried prune, and determined that the tolerance should be amended from 2.6 ppm to 3.0 ppm in order to harmonize with Codex. Data were also submitted and reviewed by EPA to allow the use of novaluron in or on greenhouse-grown cucumbers. During review, the Agency determined that the existing tolerance in or on cucurbit vegetable group 9 (which includes cucumber) should be amended from 0.15 ppm to 0.20 ppm in order to harmonize with Codex.
EPA was also petitioned to establish a tolerance in or on bean at 0.60 ppm and to remove the existing tolerance in or on dry bean seed at 0.30 ppm upon approval of the proposed bean tolerance. However, the Agency determined that separate tolerances should be established in or on succulent bean and dry bean seed. Therefore, this action will not remove the existing tolerance for the use of novaluron in or on dry bean seed at 0.30 ppm, and the Agency determined that a tolerance in or on succulent bean at 0.70 ppm is appropriate in order to harmonize with the established Codex tolerance on beans. Finally, EPA revised the proposed pome fruit crop group 11-10 tolerance from 2.0 ppm to 3.0 ppm in order to harmonize with the established Codex MRL.
Therefore, tolerances are established for residues of novaluron, (
This action establishes tolerances under FFDCA section 408(d) in response to a petition submitted to the Agency. The Office of Management and Budget (OMB) has exempted these types of actions from review under Executive Order 12866, entitled “Regulatory Planning and Review” (58 FR 51735, October 4, 1993). Because this action has been exempted from review under Executive Order 12866, this action is not subject to Executive Order 13211, entitled “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355, May 22, 2001) or Executive Order 13045, entitled “Protection of Children from Environmental Health Risks and Safety Risks” (62 FR 19885, April 23, 1997). This action does not contain any information collections subject to OMB approval under the Paperwork Reduction Act (PRA) (44 U.S.C. 3501
Since tolerances and exemptions that are established on the basis of a petition under FFDCA section 408(d), such as the tolerance in this final rule, do not require the issuance of a proposed rule, the requirements of the Regulatory Flexibility Act (RFA) (5 U.S.C. 601
This action directly regulates growers, food processors, food handlers, and food retailers, not States or tribes, nor does this action alter the relationships or distribution of power and responsibilities established by Congress in the preemption provisions of FFDCA section 408(n)(4). As such, the Agency has determined that this action will not have a substantial direct effect on States or tribal governments, on the relationship between the national government and the States or tribal governments, or on the distribution of power and responsibilities among the various levels of government or between the Federal Government and Indian tribes. Thus, the Agency has determined that Executive Order 13132, entitled “Federalism” (64 FR 43255, August 10, 1999) and Executive Order 13175, entitled “Consultation and Coordination with Indian Tribal Governments” (65 FR 67249, November 9, 2000) do not apply to this action. In addition, this action does not impose any enforceable duty or contain any unfunded mandate as described under Title II of the Unfunded Mandates Reform Act (UMRA) (2 U.S.C. 1501
This action does not involve any technical standards that would require Agency consideration of voluntary consensus standards pursuant to section 12(d) of the National Technology Transfer and Advancement Act (NTTAA) (15 U.S.C. 272 note).
Pursuant to the Congressional Review Act (5 U.S.C. 801
Environmental protection, Administrative practice and procedure, Agricultural commodities, Pesticides and pests, Reporting and recordkeeping requirements.
Therefore, 40 CFR chapter I is amended as follows:
21 U.S.C. 321(q), 346a and 371.
The additions and revisions read as follows:
(a) * * *
National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.
Modification of fishing seasons; request for comments.
NMFS announces two inseason actions in the ocean salmon fisheries. These inseason actions modified the commercial salmon fisheries in the area from the U.S./Canada border to the Oregon/California border.
The effective dates for the inseason actions are set out in this document under the heading Inseason Actions. Comments will be accepted through August 6, 2015.
You may submit comments, identified by NOAA-NMFS-2015-0001, by any one of the following methods:
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Peggy Mundy at 206-526-4323.
In the 2015 annual management measures for ocean salmon fisheries (80 FR 25611, May 5, 2015), NMFS announced the commercial and recreational fisheries in the area from the U.S./Canada border to the U.S./Mexico border, beginning May 1, 2015, and 2016 salmon fisheries opening earlier than May 1, 2016. NMFS is authorized to implement inseason management actions to modify fishing seasons and quotas as necessary to provide fishing opportunity while meeting management objectives for the affected species (50 CFR 660.409). Inseason actions in the salmon fishery may be taken directly by NMFS (50 CFR 660.409(a)—Fixed inseason management provisions) or upon consultation with the Pacific Fishery Management Council (Council) and the appropriate State Directors (50 CFR 660.409(b)—Flexible inseason management provisions). The state management agencies that participated in the consultations described in this document were: Oregon Department of Fish and Wildlife (ODFW) and Washington Department of Fish and Wildlife (WDFW).
Management of the salmon fisheries is generally divided into two geographic areas: North of Cape Falcon (U.S./Canada border to Cape Falcon, OR) and south of Cape Falcon (Cape Falcon, OR, to the U.S./Mexico border). The inseason actions reported in this document affect fisheries north and south of Cape Falcon. Within the south of Cape Falcon area, the Klamath Management Zone (KMZ) extends from Humbug Mountain, OR, to Humboldt South Jetty, CA, and is divided at the Oregon/California border into the Oregon KMZ to the north and California KMZ to the south. All times mentioned refer to Pacific daylight time.
All other restrictions and regulations remain in effect as announced for the 2015 ocean salmon fisheries and 2016
The RA determined that the best available information indicated that Chinook salmon catch to date and fishery effort supported the above inseason actions recommended by the states of Washington and Oregon. The states manage the fisheries in state waters adjacent to the areas of the U.S. exclusive economic zone in accordance with these Federal actions. As provided by the inseason notice procedures of 50 CFR 660.411, actual notice of the described regulatory actions was given, prior to the time the action was effective, by telephone hotline numbers 206-526-6667 and 800-662-9825, and by U.S. Coast Guard Notice to Mariners broadcasts on Channel 16 VHF-FM and 2182 kHz.
The Assistant Administrator for Fisheries, NOAA (AA), finds that good cause exists for this notification to be issued without affording prior notice and opportunity for public comment under 5 U.S.C. 553(b)(B) because such notification would be impracticable. As previously noted, actual notice of the regulatory actions was provided to fishers through telephone hotline and radio notification. These actions comply with the requirements of the annual management measures for ocean salmon fisheries (80 FR 25611, May 5, 2015), the West Coast Salmon Fishery Management Plan (Salmon FMP), and regulations implementing the Salmon FMP, 50 CFR 660.409 and 660.411. Prior notice and opportunity for public comment was impracticable because NMFS and the state agencies had insufficient time to provide for prior notice and the opportunity for public comment between the time Chinook salmon catch and effort assessments and projections were developed and fisheries impacts were calculated, and the time the fishery modifications had to be implemented in order to ensure that fisheries are managed based on the best available scientific information, ensuring that conservation objectives and ESA consultation standards are not exceeded. The AA also finds good cause to waive the 30-day delay in effectiveness required under 5 U.S.C. 553(d)(3), as a delay in effectiveness of these actions would allow fishing at levels inconsistent with the goals of the Salmon FMP and the current management measures.
These actions are authorized by 50 CFR 660.409 and 660.411 and are exempt from review under Executive Order 12866.
16 U.S.C. 1801
National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.
Temporary rule; closure.
NMFS is prohibiting directed fishing for Pacific ocean perch in the West Yakutat District of the Gulf of Alaska (GOA). This action is necessary to prevent exceeding the 2015 total allowable catch of Pacific ocean perch in the West Yakutat District of the GOA.
Effective 1200 hours, Alaska local time (A.l.t.), July 17, 2015, through 2400 hours, A.l.t., December 31, 2015.
Obren Davis, 907-586-7228.
NMFS manages the groundfish fishery in the GOA exclusive economic zone according to the Fishery Management Plan for Groundfish of the Gulf of Alaska (FMP) prepared by the North Pacific Fishery Management Council under authority of the Magnuson-Stevens Fishery Conservation and Management Act. Regulations governing fishing by U.S. vessels in accordance with the FMP appear at subpart H of 50 CFR part 600 and 50 CFR part 679.
The 2015 total allowable catch (TAC) of Pacific ocean perch in the West Yakutat District of the GOA is 2,014 metric tons (mt) as established by the final 2015 and 2016 harvest specifications for groundfish of the (80 FR 10250, February 25, 2015).
In accordance with § 679.20(d)(1)(i), the Administrator, Alaska Region, NMFS (Regional Administrator), has determined that the 2015 TAC of Pacific ocean perch in the West Yakutat District of the GOA will soon be reached. Therefore, the Regional Administrator is establishing a directed fishing allowance of 1,914 mt, and is setting aside the remaining 100 mt as bycatch to support other anticipated groundfish fisheries. In accordance with § 679.20(d)(1)(iii), the Regional Administrator finds that this directed fishing allowance has been reached. Consequently, NMFS is prohibiting directed fishing for Pacific ocean perch in the West Yakutat District of the GOA.
After the effective date of this closure the maximum retainable amounts at § 679.20(e) and (f) apply at any time during a trip.
This action responds to the best available information recently obtained from the fishery. The Assistant Administrator for Fisheries, NOAA (AA), finds good cause to waive the requirement to provide prior notice and opportunity for public comment pursuant to the authority set forth at 5 U.S.C. 553(b)(B) as such requirement is impracticable and contrary to the public interest. This requirement is impracticable and contrary to the public interest as it would prevent NMFS from responding to the most recent fisheries data in a timely fashion and would delay the closure of directed fishing for Pacific ocean perch in the West Yakutat District of the GOA. NMFS was unable to publish a notice providing time for public comment because the most recent, relevant data only became available as of July 16, 2015.
The AA also finds good cause to waive the 30-day delay in the effective date of this action under 5 U.S.C. 553(d)(3). This finding is based upon the reasons provided above for waiver of prior notice and opportunity for public comment.
This action is required by § 679.20 and is exempt from review under Executive Order 12866.
16 U.S.C. 1801
U.S. Citizenship and Immigration Services, Department of Homeland Security.
Proposed rule.
The Department of Homeland Security (DHS) proposes to expand eligibility for provisional waivers of certain grounds of inadmissibility based on the accrual of unlawful presence to all aliens who are statutorily eligible for a waiver of such grounds, are seeking such a waiver in connection with an immigrant visa application, and meet other conditions. The provisional waiver process currently allows certain aliens who are present in the United States to request from U.S. Citizenship and Immigration Services (USCIS) a provisional waiver of certain unlawful presence grounds of inadmissibility prior to departing from the United States for consular processing of their immigrant visas—rather than applying for a waiver abroad after the immigrant visa interview using the Form I-601, Waiver of Grounds of Inadmissibility (hereinafter “Form I-601 waiver process”). DHS proposes to expand its current provisional waiver process in two principal ways. First, DHS would eliminate current limitations on the provisional waiver process that restrict eligibility to certain immediate relatives of U.S. citizens. Under this proposed rule, the provisional waiver process would be made available to all aliens who are statutorily eligible for waivers of inadmissibility based on unlawful presence and meet certain other conditions. Second, in relation to the statutory requirement that the waiver applicant demonstrate that denial of the waiver would result in “extreme hardship” to certain family members, DHS proposes to expand the provisional waiver process by eliminating the current restriction that limits extreme hardship determinations only to aliens who can establish extreme hardship to U.S. citizen spouses or parents. Under this proposed rule, an applicant for a provisional waiver would be permitted to establish the eligibility requirement of showing extreme hardship to any qualifying relative (namely, U.S. citizen
Submit written comments on or before September 21, 2015. Comments on the information collection revisions in this rule, as described in the Paperwork Reduction Act section, will also be accepted until September 21, 2015.
You may submit comments, identified by DHS Docket No. USCIS-2012-0003, by one of the following methods:
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Roselyn Brown-Frei, Office of Policy and Strategy, Residence and Naturalization Division, U.S. Citizenship and Immigration Services, Department of Homeland Security, 20 Massachusetts Avenue NW., Washington, DC 20529-2099, Telephone (202) 272-1470 (this is not a toll free number).
DHS invites all interested parties to submit written data, views, or arguments on all aspects of this proposed rule. DHS also invites comments about how the proposed rule might affect the economy, environment,
(1) Refer to a specific portion of this proposed rule;
(2) Explain the reason for any recommended change; and
(3) Include data, information, or references to authority that support the recommended change.
Section 102 of the Homeland Security Act of 2002 (Public Law 107-296, 116 Stat. 2135), 6 U.S.C. 112, and section 103 of the Immigration and Nationality Act (INA), 8 U.S.C. 1103, charge the Secretary of Homeland Security (Secretary) with the administration and enforcement of the immigration and naturalization laws of the United States. The Secretary proposes the changes in this rule under the broad authority to administer the authorities provided under the Homeland Security Act of 2002, the immigration and nationality laws, and other delegated authorities. The Secretary's discretionary authority to waive the unlawful presence grounds of inadmissibility is provided in INA section 212(a)(9)(B)(v), 8 U.S.C. 1182(a)(9)(B)(v).
U.S. immigration laws provide avenues for U.S. citizens, LPRs, and U.S. employers to bring their families or employees permanently to the United States. Certain other categories of aliens are eligible for immigrant visas through special processes.
Generally, if a U.S. citizen or LPR seeks to sponsor a relative for lawful permanent residence in the United States, the U.S. citizen or LPR must first file an immigrant visa petition for the relative with USCIS.
The purpose of the immigrant visa petition is to classify the alien as an intending immigrant who is either an immediate relative of a U.S. citizen (
Many aliens present in the United States who are the beneficiaries of approved immigrant visa petitions are eligible to adjust to LPR status while remaining in the United States.
If an alien seeks an immigrant visa abroad through consular processing, USCIS forwards the approved immigrant visa petition to the DOS National Visa Center (NVC), which completes initial processing of petition-based immigrant visa applications. The NVC notifies the alien when he or she
An alien may also immigrate to the United States through the Diversity Visa program administered by DOS.
If selected and eligible, an alien may be authorized to seek LPR status either through adjustment of status in the United States or through consular processing abroad with DOS. If the alien chooses to use the consular process, he or she must submit an immigrant visa application (Form DS-260, Immigrant Visa Electronic Application) to the DOS Kentucky Consular Center (KCC), which completes initial processing of the immigrant visa applications from Diversity Visa program selectees and derivatives. If the immigrant visa application is complete and an immigrant visa is available, the KCC schedules the alien for an immigrant visa interview abroad. The DOS consular officer determines whether the alien is admissible to the United States and eligible for the immigrant visa. A program selectee or derivative (such as the spouse or minor child of a program selectee), however, can obtain an immigrant visa only in the fiscal year for which he or she was selected, provided the numerical limits have not been reached.
Diversity Visa program processing is different from the petition-based immigrant visa process, as Diversity Visa program selectees and their derivatives are not beneficiaries of approved immigrant visa petitions. DOS completes initial processing of program selectees and derivatives at the KCC instead of at the NVC. The Diversity Visa program pre-processing steps aim to ensure that DOS can issue as many visas to program selectees and derivatives as possible during the particular fiscal year. For example, Diversity Visa program selectees and their derivatives submit their immigrant visa applications to the KCC without the additional documents required for immigrant visa processing. Program selectees and derivatives submit the additional required documents to the DOS consular officer as part of the immigrant visa interview and process. In addition, unlike immediate-relative, family-sponsored, employment-based, and special-immigrant visa applicants, Diversity Visa program selectees and their derivatives pay their immigrant visa processing fees at their immigrant visa interviews rather than before DOS schedules the interviews.
U.S. immigration laws specify acts, conditions, and conduct that bar aliens from being admitted to the United States or from obtaining visas, including immigrant visas.
The inadmissibility ground based on the accrual of unlawful presence in the United States is found at INA section 212(a)(9)(B)(i), 8 U.S.C. 1182(a)(9)(B)(i). Under that provision, an alien who was unlawfully present in the United States for more than 180 days but less than one year and who then departs voluntarily from the United States before removal proceedings begin is inadmissible to the United States for 3 years from the date of departure.
These 3- and 10-year unlawful presence bars do not take effect unless and until the alien departs from the United States.
Because approval of the waiver is discretionary, the alien also must establish that he or she merits a favorable exercise of discretion.
The 3- and 10-year unlawful presence bars to admissibility under INA section 212(a)(9)(B) do not apply unless and until an alien who accrued sufficient unlawful presence departs from the United States. Many aliens who would trigger these bars upon departure from the United States are ineligible to adjust
Under the Form I-601 waiver process, an immigrant visa applicant may file an Application for Waiver of Grounds of Inadmissibility, Form I-601, with USCIS
Upon approving the Form I-601 waiver application, USCIS notifies DOS so that DOS may issue the immigrant visa if the alien is otherwise eligible. If USCIS denies the Form I-601 waiver application, the alien remains inadmissible and, therefore, ineligible for an immigrant visa and is generally unable to lawfully return to the United States. If the alien is inadmissible based on the 3- or 10-year unlawful presence bar, he or she must remain outside of the United States for the relevant 3- or 10-year period before he or she can reapply for an immigrant visa without having to obtain a waiver. An alien may appeal the denial of a Form I-601 waiver application with the USCIS Administrative Appeals Office (AAO). Alternatively, the alien can file another Form I-601 waiver application.
Immigrant visa applicants typically encounter difficulties when seeking waivers of the 3- and 10-year unlawful presence bars through the Form I-601 waiver process abroad. After attending the immigrant visa interview with DOS, these applicants must gather the necessary information and supporting documents, file their Form I-601 waiver applications with USCIS, and typically wait abroad for at least several months for a decision on their applications based on the average adjudication time for Form I-601 waiver applications.
Inefficiencies in the Form I-601 waiver process also create costs for the Federal Government. If a DOS officer at a U.S. Embassy or consulate determines that the applicant is inadmissible based on a ground that can be waived, the DOS officer informs the applicant about the option to file a waiver application with USCIS. After the interview, DOS puts the immigrant visa process on hold while waiting for the applicant to submit the Form I-601 waiver application and for USCIS's decision on the waiver. If a waiver is approved, DOS must reschedule the applicant for additional visa processing at a U.S. Embassy or consulate, which uses valuable DOS consular officer resources that could be used for processing other visa applications.
In 2013, DHS sought to partially address the difficulties and inefficiencies of the Form I-601 waiver process through rulemaking. DHS published a rule establishing a provisional waiver process, which streamlines certain aspects of the Form I-601 waiver process, facilitates immigrant visa issuance, and promotes family unity.
DHS initially limited eligibility for provisional waivers to immediate relatives of U.S. citizens (spouses, parents and children (under the age of 21) of U.S. citizens). The intention was to prioritize the family reunification of immediate relatives of U.S. citizens over other categories of aliens. Limiting the program also allowed DHS to assess the initial effectiveness of a provisional waiver process. Accordingly, DHS restricted eligibility for provisional waivers to immediate relatives of U.S. citizens who could demonstrate that their U.S. citizen spouses or parents would suffer extreme hardship if the immediate relatives were refused admission to the United States.
In the 2013 final rule, DHS noted that it would consider expanding provisional waiver eligibility after DHS and DOS assessed the effectiveness of the provisional waiver process and the operational impact it may have on existing agency processes and resources.
DHS proposes to expand the class of aliens who may be eligible for a provisional waiver beyond immediate relatives of U.S. citizens to aliens in all statutorily eligible immigrant visa categories. Such aliens include family-sponsored immigrants, employment-based immigrants, certain special immigrants, and Diversity Visa program selectees, together with their derivative spouses and children.
This proposed expansion will permit any alien seeking an immigrant visa who would be eligible to apply for a Form I-601 waiver of unlawful presence abroad to now apply for a provisional waiver
DHS does not propose to change any eligibility requirements for a provisional waiver other than those described in this rulemaking.
Under the proposed rule, an alien would be eligible for a provisional waiver if, among other criteria, he or she has an immigrant visa case pending with DOS based on an approved immigrant visa petition and has paid the immigrant visa processing fee. Aliens with an approved immigrant visa petition include:
• A beneficiary of an approved Petition for Alien Relative, Form I-130, or Petition for Amerasian, Widow(er), and Special Immigrant, Form I-360 (classifying the alien as immigrant visa applicant under INA section 201(b)(2), 8 U.S.C. 1151(b)(2), or INA section 203(a) or (b), 8 U.S.C. 1153(a) or (b));
• A beneficiary of an approved Immigrant Petition for Alien Worker, Form I-140 (classifying the alien as immigrant visa applicant under INA section 203(b), 8 U.S.C. 1153(b)); and
• A spouse or child, as defined in subparagraph (A), (B), (C), (D) or (E) of INA section 101(b)(1), 8 U.S.C. 1101(b)(1), if accompanying or following-to-join an alien spouse or parent seeking to immigrate under INA section 203(a) or (b), 8 U.S.C. 1153(a) or (b), or under INA section 203(d), 8 U.S.C. 1153(d).
Under the proposed rule, an alien would also be eligible for a provisional waiver based on selection by DOS to participate in the Diversity Visa program under INA section 203(c), 8 U.S.C. 1153(c) for the fiscal year for which the alien registered. Expanding the provisional waiver process to Diversity Visa program selectees and their derivatives requires USCIS to develop procedures that apply only to these applicants because such applicants do not have approved immigrant visa petitions. DOS's selection of an alien for the Diversity Visa program is for these purposes being considered the functional equivalent of having an approved immigrant visa petition.
DHS proposes to expand eligibility for provisional waivers to include aliens who can establish extreme hardship to an LPR spouse or parent. This proposed expansion would allow immigrant visa applicants, including diversity visa applicants, to seek provisional waivers based on extreme hardship to all categories of qualifying relatives authorized by statute. See proposed 8 CFR 212.7(e)(3)(vi) and 8 CFR 212.7(e)(8). Although the benefits of this rule largely would accrue to the expanded group of aliens newly eligible to apply for provisional waivers under the rule, certain immediate relatives of U.S. citizens will also experience
DHS proposes to limit eligibility for provisional waivers under this rulemaking to aliens, other than immediate relatives of U.S. citizens, who have not had their immigrant visa interviews scheduled before the effective date of a final rule. DHS also proposes that immediate relatives of U.S. citizens will be eligible to file for provisional waivers if they have not had their immigrant visa interviews scheduled before January 3, 2013, even if they may not have been previously eligible to apply for provisional waivers under the current rule.
As reflected in the 2013 rulemaking, these restrictions are necessary to make the process operationally manageable without creating delays in the processing of other petitions or applications filed with USCIS or in the DOS immigrant visa process. If the proposed rule included aliens who were scheduled for an interview prior to the effective date of a final rule, the projected volume of cases could increase and create backlogs not only in the provisional waiver process, but also in adjudication of other USCIS benefits. The increased volume could also adversely impact DOS and its immigrant visa process.
This rule also proposes to remove from the affected regulations all unnecessary procedural instructions regarding office names and locations, position titles and responsibilities, and form numbers. Prescribing an office name, such as “Application Support Center,” is unnecessary and restricts USCIS' ability to vary work locations as necessary to address its workload needs, better utilize its resources, and serve its customers.
In addition, USCIS is proposing to revise 8 CFR 212.7(e)(8) by removing the superfluous sentence that states USCIS may require the alien and the U.S. citizen petitioner to appear for an interview pursuant to 8 CFR 103.2(b)(9). USCIS already has the authority to require an applicant or petitioner to appear for an interview under 8 CFR 103.2(b)(9). USCIS thus retains the authority to require an interview regardless of the inclusion of such authority in § 212.7(e)(8). The cross reference at 8 CFR 212.7(e)(8) was unnecessarily redundant.
Finally, DHS is correcting two errors. First, in 8 CFR 103.2(b), DHS is replacing the article “an” with the article “a,” wherever the article appears before the term “benefit request” in paragraphs (b)(6), (b)(9), (b)(10), and (b)(12). Second, in 8 CFR 212.7(a), DHS is removing the title to effectuate the change that was intended to be made in the 2013 rule.
By making the provisional waiver process available to all aliens who are statutorily eligible for the waiver of unlawful presence under section 212(a)(9)(B)(v) and meet certain other conditions, DHS would be expanding the population of aliens who could benefit from a streamlined immigrant visa process. DHS believes that expanding availability of the provisional waiver process would likely reduce the overall immigrant visa processing time for eligible immigrant visa applicants, thereby saving DHS, DOS, and applicants both the time and resources currently devoted to the Form I-601 waiver process. DHS also believes that the proposed expansion would reduce the hardship that U.S. citizen and LPR families experience as a result of separation from their alien relatives. Some immediate relatives of U.S. citizens may also benefit from the proposal to broaden the group of individuals who can serve as qualifying relatives for the provisional waiver's extreme hardship determination.
DHS invites comments from all interested parties, including advocacy groups, nongovernmental organizations, community-based organizations, and legal representatives who specialize in immigration law, on any and all aspects of this proposed rule. DHS is specifically seeking comments on:
a. The proposal to expand eligibility for provisional waivers to include the following aliens not covered by the current rule:
• Immediate relatives of U.S. citizens under INA section 201(b)(2), 8 U.S.C. 1151(b)(2), who can establish extreme hardship to an LPR spouse or parent as provided under INA section 212(a)(9)(B)(v);
• Family-sponsored immigrant visa applicants under INA section 203(a), 8 U.S.C. 1153(a);
• Employment-based immigrant visa applicants and certain special immigrants under INA section 203(b), 8 U.S.C. 1153(b);
• Diversity immigrants under INA section 203(c), 8 U.S.C. 1153(c); and
• Derivative family members of the above mentioned immigrant visa applicants, in accordance with INA section 203(d), 8 U.S.C. 1153(d).
b. The proposal to limit eligibility for provisional waivers to aliens as follows: (1) for immediate relatives of U.S. citizens, to those for whom DOS initially acted to schedule their immigrant visa interviews on or after January 3, 2013; and (2) for all other immigrant visa applicants, on or after the effective date of the final rule.
c. Any alternatives to this proposed rule that may be more effective than the current provisional waiver process or the amended process described in the proposed rule.
This proposed rule will not result in the expenditure by State, local and tribal governments, in the aggregate, or by the private sector, of $100 million or more in any one year, and it will not significantly or uniquely affect small governments. Therefore, no actions were deemed necessary under the provisions of the Unfunded Mandates Reform Act of 1995.
This proposed rule is not a major rule as defined by section 804 of the Small Business Regulatory Enforcement Act of 1996. This rule will not result in an annual effect on the economy of $100 million or more; a major increase in costs or prices; or significant adverse effects on competition, employment, investment, productivity, innovation, or on the ability of United States-based companies to compete with foreign-based companies in domestic and export markets.
Executive Orders 12866 and 13563 direct agencies to assess the costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This rule is a “significant regulatory action,” although not an economically significant regulatory action, under section 3(f) of Executive Order 12866. Accordingly, the Office of Management and Budget has reviewed this regulation. This effort is consistent with Executive Order 13563's call for agencies to “consider how best to promote retrospective analysis of rules that may be outmoded, ineffective, insufficient, or excessively burdensome, and to modify, streamline, expand, or repeal them in accordance with what has been learned.”
The proposed expansion of the provisional waiver process would create costs and benefits to provisional waiver (Form I-601A) applicants, their U.S. citizen or lawful permanent resident (LPR) family members, and the Federal Government (namely, U.S. Citizenship and Immigration Services (USCIS) and the Department of State (DOS)), as summarized in Table 1. This rule would impose fee, time, and travel costs on aliens who choose to complete and submit provisional waiver applications and biometrics (namely, fingerprints, photograph, and signature) to USCIS for consideration. These costs would be $58.5 million at a 7 percent discount rate and $71.6 million at a 3 percent discount rate in present value across the 10-year period of analysis. On an annualized basis, the costs are $8.3 million and $8.4 million at 7 percent and 3 percent, respectively (
Newly eligible provisional waiver applicants and their U.S. citizen or LPR family members would benefit from this rule. Beneficiaries of provisional waivers may experience shortened periods of separation from their family members living in the United States while they pursue an immigrant visa abroad, thus reducing any related financial and emotional strain on the family. If finalized, some immediate relatives of U.S. citizens may also benefit from the rule's broadened group of individuals who can be qualifying relatives for the provisional waiver's extreme hardship determination. Additionally, USCIS and DOS would continue to benefit from the operational efficiencies gained from the provisional waiver's role in streamlining immigrant visa application processing, though on a larger scale than currently in place.
In the absence of this rule, DHS assumes that the majority of aliens newly eligible for provisional waivers under this rule would pursue an immigrant visa through consular processing abroad and apply for waivers of unlawful presence through the Form I-601 process. Aliens who would otherwise apply for unlawful presence waivers through the Form I-601 process would incur fee, time, and travel costs similar to aliens applying for waivers through the provisional waiver process. But in the absence of this rule, Form I-601 applicants would face longer separation times from their family in the United States and less certainty regarding their application for the waiver.
Aliens who are in the United States and seeking LPR status must either obtain an immigrant visa abroad through consular processing with DOS or apply to adjust status in the United States, if eligible. Aliens present in the United States without having been inspected and admitted or paroled are typically ineligible to adjust their status in the United States. To obtain LPR status, such aliens must leave the United States for immigrant visa processing at a U.S. Embassy or consulate abroad. Because these aliens are present in the United States without having been inspected and admitted or paroled, many have already accrued enough unlawful presence (more than 180 days) to trigger the 3- or 10-year unlawful presence grounds of inadmissibility upon departure from the United States. Indeed, in most cases, the action these aliens must take to obtain their immigrant visa—departing the United States to attend a consular interview—is the very action that triggers the 3- or 10-year bar to admissibility due to the accrual of unlawful presence.
Historically, aliens seeking an immigrant visa through consular processing were only able to apply for a waiver of a ground of inadmissibility, like a waiver of inadmissibility for unlawful presence, after attending their immigrant visa interview abroad. If a consular officer identified a ground or grounds of inadmissibility during an immigrant visa interview, the immigrant visa applicant was tentatively denied an immigrant visa and allowed to complete a waiver of the applicable ground(s) of inadmissibility, if a waiver was available. The immigrant visa applicant could apply for such a waiver by filing an Application for Waiver of Grounds of Inadmissibility, Form I-601, with USCIS. Applicants who applied for such waivers were required to remain abroad while USCIS adjudicated their Form I-601, which currently takes an average of five months to complete.
With the goals of streamlining the inadmissibility waiver process, facilitating efficient immigrant visa issuance, and promoting family unity, DHS promulgated a rule that established an alternative inadmissibility waiver process on January 3, 2013 (“2013 rule”).
Since the provisional waiver process's inception, USCIS has approved more than 44,000 provisional waiver applications (through Form I-601A filings) for certain immediate relatives of U.S. citizens,
Despite the provisional waiver process's benefits to certain immediate relatives of U.S. citizens, thousands of non-immediate relatives of U.S. citizens and LPRs
To assess the initial effectiveness of the provisional waiver process, DHS decided to offer this process to a limited group of aliens in the 2013 rule.
This rule's proposed changes would provide more aliens and their U.S. citizen or LPR family members with the provisional waiver's main benefit of shortened family separation periods, while increasing USCIS and DOS efficiencies by streamlining the immigrant visa process for such aliens. Additionally, the proposed changes may allow more immediate relatives of U.S. citizens to qualify for provisional waivers by broadening the group of individuals who could serve as qualifying relatives for the waiver's extreme hardship determination. Other than the changes proposed in this rulemaking, DHS would maintain all other eligibility requirements for the provisional waiver as currently outlined in 8 CFR 212.7(e), including the requirements to submit biometrics, pay a $585 application fee and $85 biometric services fee, and be currently present in the United States at the time of the provisional waiver application filing and biometrics appointment.
In this analysis, DHS draws on relevant DOS inadmissibility statistics and historical provisional waiver application data to estimate the demand for provisional waivers occurring in the absence of this rule (for certain immediate relatives of U.S. citizens), as well as directly resulting from this rule
With
The actual Form I-601A filing demands, illustrated in Table 2 and Table 4, differ from the estimates in the 2013 rule's economic impact analysis. When DHS conducted the 2013 rule's economic impact analysis, DHS did not have statistics on unlawful presence inadmissibility findings for immediate relatives that would allow for a precise calculation of the rule's impact. Due to such limitations, DHS instead estimated the rule's impact based on various demand scenarios. In this rule's analysis, DHS retrospectively examined DOS data on unlawful presence inadmissibility findings for immediate relatives and compared this information against USCIS receipts for provisional waiver applications (through Form I-601A filings) to determine the future demand for provisional waivers.
When determining a figure upon which to base future inadmissibility estimates and subsequent Form I-601A demand, DHS chose to use the actual FY 2014 inadmissibility count for unlawful presence rather than a multi-year
With this rule's implementation, the number of provisional waiver applications would increase from the figures listed in Table 5 as the waiver eligibility criteria expands from only certain immediate relatives of U.S. citizens to include all other immigrant visa applicants who are present in the United States and who otherwise meet the requirements of the provisional waiver process.
To determine the impact of this rule, DHS employs the same projection method used to estimate future volumes of unlawful presence inadmissibility findings and provisional waiver applications occurring in the absence of this rule. By applying the previously discussed historical 2.5 percent compound annual growth rate of unauthorized immigrants from 2000 to 2012, to the FY 2014 count of all other immigrant visa inadmissibility findings due to only unlawful presence (13,946, as listed in Table 3), DHS projects that non-immediate relative immigrant visa inadmissibility findings due to only unlawful presence would measure approximately 14,295 during this rule's first year of implementation (see Table 6).
Table 6 outlines the population of all other immigrant visa applicants impacted by this rule. During this rule's first year of implementation, DHS projects that USCIS could receive approximately 10,006 provisional waiver applications from newly eligible non-immediate relatives.
In addition to the non-immediate relative population affected by this rule illustrated in Table 6, this rule's broadened group of qualifying relatives for the provisional waiver's extreme hardship determination may impact some immediate relatives of U.S. citizens. Yet, the exact number of such immediate relatives is unknown. DHS welcomes any public comments on the population projections used in this analysis.
To summarize, aliens who are immediate relatives of U.S. citizens and who are currently eligible for provisional waivers would continue to apply for such waivers in the absence of this rule. At the time of the 2013 rule, DHS was unable to predict the likely application volumes of Form I-601A with precision. With additional information from DOS and the experience since the provisional waiver's inception, DHS can reasonably project the provisional waiver application rate from currently eligible immediate relatives who trigger unlawful presence bars. In fact, DHS
Applicants from the expanded population of aliens who are newly eligible to apply for a provisional waiver under this proposed rule would bear the costs of this regulation. Certain immediate relatives of U.S. citizens already eligible to apply for a provisional waiver would not incur costs from this rule.
To receive a provisional waiver under this rule, eligible aliens must first complete a Form I-601A and submit it to USCIS with its $585 filing fee and $85 biometric services fee. DHS estimates the time burden of completing Form I-601A to be 1.5 hours, which translates to a time, or opportunity, cost of $15.89 per application.
After USCIS receives an alien's completed Form I-601A and its filing and biometric services fees, the agency sends the alien a notice scheduling him or her to visit a USCIS Application Support Center (ASC) for biometrics collection. Along with an $85 biometric services fee, the applicant would incur the following costs to comply with the provisional waiver's biometrics submission requirement: the opportunity cost of traveling to an ASC, the opportunity cost of submitting his or her biometrics, and the mileage cost of traveling to an ASC. While travel times and distances vary, DHS estimates that an applicant's average roundtrip distance to an ASC is 50 miles, and that the average time for that trip is 2.5 hours. DHS estimates that an alien waits an average of 1.17 hours for service and to have his or her biometrics collected at an ASC, adding up to a total biometrics-related time burden of 3.67 hours.
Once all of the aforementioned fee, time, and travel costs to comply with the provisional waiver's requirements are accounted for, DHS finds that each Form I-601A filing would cost an alien $753.51. Table 7 shows that the overall cost of this rule to the expanded population of provisional waiver applicants (namely, non-immediate relatives of U.S. citizens and LPRs) would measure $84.5 million (undiscounted) over the 10-year period of analysis. DHS calculates this rule's total cost to applicants by multiplying
DHS welcomes any public comments on the costs of this proposed rule.
The benefits of this proposed rule are largely the result of streamlining the immigrant visa process for an expanded population of aliens who are inadmissible to the United States solely due to unlawful presence. For those aliens who are newly eligible for a provisional waiver and their U.S. citizen or LPR family members, the primary benefits of this rule are its reduced separation time among family members during the immigrant visa process for aliens granted waivers and improved predictability of the immigrant visa process. Instead of attending multiple immigrant visa interviews and waiting abroad while USCIS adjudicates a waiver application as required under the Form I-601 waiver process, the provisional waiver process allows aliens to file a provisional waiver application and remain in the United States while it is adjudicated by USCIS. This process generally allows eligible provisional waiver applicants to stay with their family members in the United States while awaiting adjudication and to receive advance notice of USCIS's decision on their waiver application prior to leaving the United States for their immigrant visa interview abroad. Although DHS cannot estimate with precision the exact amount of separation time families would save through this rule, DHS estimates that some newly eligible provisional waiver applicants and their U.S. citizen or LPR family members could experience several months of reduced separation time based on the average adjudication time for Form I-601 waiver applications.
Due to the unique nature of the Diversity Visa program, aliens seeking an immigrant visa through that program and wishing to use the provisional waiver process are likely to enjoy fewer overall benefits from this rule than other non-immediate relative immigrant visa and waiver applicants. Although an alien may be selected to participate in the Diversity Visa program, he or she may not ultimately receive an immigrant visa due to visa unavailability. Under this proposed rule, Diversity Visa selectees and their derivatives who wish to use the provisional waiver process may file a waiver application in advance of knowing whether their immigrant visa will ultimately be available to them. For those provisional waiver applicants pursuing the Diversity Visa track, the risk of completing the provisional waiver process without being issued a visa is higher compared to applicants of other immigrant visa categories filing Form I-601A.
Although the main benefits of this rule would center on the expanded group of aliens newly eligible to apply for provisional waivers, certain immediate relatives of U.S. citizens may also experience benefits from this rule. Through this rulemaking, DHS proposes to allow LPR spouses and parents, in addition to currently eligible U.S. citizen spouses and parents, to serve as qualifying relatives for the provisional waiver's extreme hardship determination. This change may allow some immediate relatives of U.S. citizens (included in Table 5's inadmissible immediate relative estimates) to now qualify for a provisional waiver, although the exact number of individuals who would benefit from this change is unknown due to data limitations.
Based on USCIS and DOS efficiencies realized as a result of the current provisional waiver process, DHS believes that this rule could provide additional Federal Government efficiencies through its expansion to a larger population of aliens. As previously described in the 2013 rule, the provisional waiver process allows USCIS to communicate to DOS the status of an unlawful presence inadmissibility waiver prior to a waiver applicant's immigrant visa interview abroad. Such early communication eliminates the current need for USCIS and DOS to transfer cases repeatedly between the two agencies when adjudicating an immigrant visa application and Form I-601 waiver application.
DHS welcomes any public comments on the benefits of this proposed rule.
The Regulatory Flexibility Act of 1980 (RFA), 5 U.S.C. 601-612, as amended by the Small Business Regulatory Enforcement Fairness Act of 1996, Public Law 104-121 (Mar. 29, 1996), requires Federal agencies to consider the potential impact of regulations on small businesses, small governmental jurisdictions, and small organizations during the development of their rules. 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. DHS has reviewed this regulation in accordance with the Regulatory Flexibility Act and certifies that this rule would not have a significant economic impact on a substantial number of small entities. The factual basis for this determination is that this rule directly regulates individuals, who are not, for purposes of the Regulatory Flexibility Act, within the definition of small entities established by 5 U.S.C. 601(6).
This proposed rule would not have substantial direct effects 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. Therefore, in accordance with section 6 of Executive Order 13132, it is determined that this rule does not have sufficient federalism implications to warrant the preparation of a federalism summary impact statement.
Section 3(c) of Executive Order 12988 requires Executive agencies to review regulations in light of applicable standards in section 3(a) and section 3(b) to determine whether they are met or it is unreasonable to meet one or more of them. DHS has completed the required review and determined that, to the extent permitted by law, this rule meets the relevant standards of Executive Order 12988.
Under the Paperwork Reduction Act of 1995, Public Law 104-13, Departments are required to submit to the Office of Management and Budget (OMB), for review and approval, any reporting requirements inherent in a rule. This rule proposes a revision to the Application for a Provisional Unlawful Presence Waiver, Form I-601A, OMB Control Number 1615-0123. USCIS estimates that approximately 10,258 new respondents would file applications for provisional waivers as a result of the changes proposed by this rule.
DHS is requesting comments on the revisions it is proposing to make to this information collection until September 21, 2015.
In accordance with the Paperwork Reduction Act (PRA) of 1995, the information collection notice is published in the
(1) Evaluate whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility;
(2) Evaluate the accuracy of the agency's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used;
(3) Enhance the quality, utility, and clarity of the information to be collected; and
(4) Minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology,
(1)
(2)
(3)
(4)
(5)
(6)
(7)
Administrative practice and procedure, Authority delegations (Government agencies), Freedom of information, Privacy, Reporting and recordkeeping requirements, Surety bonds.
Administrative practice and procedure, Aliens, Immigration, Passports and visas, Reporting and recordkeeping requirements.
Accordingly, DHS proposes to amend chapter I of title 8 of the Code of Federal Regulations as follows:
5 U.S.C. 301, 552, 552a; 8 U.S.C. 1101, 1103, 1304, 1356; 31 U.S.C. 9701; Pub. L. 107-296, 116 Stat. 2135; 6 U.S.C. 1
8 U.S.C. 1101 and note, 1102, 1103, 1182 and note, 1184, 1187, 1223, 1225, 1226, 1227, 1255, 1359; 8 U.S.C. 1185 note (section 7209 of Pub. L. 108-458); 8 CFR part 2. Section 212.1(q) also issued under section 702, Public Law 110-229, 122 Stat. 754, 854.
The revisions read as follows:
(e)
(3) * * *
(i) Is present in the United States at the time of filing the application for a provisional unlawful presence waiver;
(ii) Provides biometrics to USCIS at a location in the United States designated by USCIS;
(iii) Upon departure, would be inadmissible only under section 212(a)(9)(B)(i) of the Act at the time of the immigrant visa interview;
(iv) Has a case pending with the Department of State, based on:
(A) An approved immigrant visa petition, for which the Department of State immigrant visa processing fee has been paid; or
(B) Selection by the Department of State to participate in the Diversity Visa Program under section 203(c) of the Act for the fiscal year for which the alien registered;
(v) Will depart from the United States to obtain the immigrant visa; and
(vi) Meets the requirements for a waiver provided in section 212(a)(9)(B)(v) of the Act.
(4) * * *
(iii) The alien does not have a case pending with the Department of State, based on:
(A) An approved immigrant visa petition, for which the Department of State immigrant visa processing fee has been paid; or
(B) Selection by the Department of State to participate in the Diversity Visa program under section 203(c) of the Act for the fiscal year for which the alien registered;
(iv) The Department of State initially acted to schedule the immigrant visa interview:
(A) Before January 3, 2013, for an immediate relative of a U.S. citizen with an approved immediate relative petition on which a provisional unlawful presence waiver is based, even if the interview was cancelled or rescheduled on or after January 3, 2013; or
(B) For all other immigrant visa applicants, before [EFFECTIVE DATE OF FINAL RULE], for the approved immigrant visa petition or the Diversity Visa program application on which a provisional unlawful presence waiver is based, even if the interview was cancelled or rescheduled on or after [EFFECTIVE DATE OF FINAL RULE];
(v) The alien is in removal proceedings, unless the removal proceedings are administratively closed and have not been recalendared at the time of filing the application for a provisional unlawful presence waiver;
(vi) The alien is subject to a final order of removal issued under section 217, 235, 238, or 240 of the Act or a final order of exclusion or deportation under former section 236 or 242 of the Act (pre-April 1, 1997), or any other provision of law (including an in absentia removal order under section 240(b)(5) of the Act);
(5)
(ii) * * *
(E) Does not include evidence of:
(
(
(
(F) Fails to include documentation evidencing:
(
(
(G) Has indicated on a provisional unlawful presence waiver application that the Department of State initially acted to schedule the immigrant visa interview:
(
(
(6) * * *
(ii)
(7)
(8)
(9)
(10)
(12) * * *
(i) * * *
(C) Is determined to be otherwise eligible for an immigrant visa by the Department of State in light of the approved provisional unlawful presence waiver.
(ii) Waives the alien's inadmissibility under section 212(a)(9)(B) of the Act only for purposes of the application for an immigrant visa and admission to the United States as an immigrant based on the approved immigrant visa petition upon which a provisional unlawful presence waiver application is based or selection by the Department of State to participate in the Diversity Visa Program under section 203(c) of the Act for the fiscal year for which the alien registered, with such selection being the basis for the alien's provisional unlawful presence waiver application;
(14) * * *
(i) The Department of State determines at the time of the immigrant visa interview that the alien is ineligible to receive an immigrant visa for any reason other than under section 212(a)(9)(B)(i)(I) or (II) of the Act;
(iii) The immigrant visa registration is terminated in accordance with section 203(g) of the Act, and has not been reinstated in accordance with section 203(g) of the Act; or
(iv) The alien, at any time before or after approval of a provisional unlawful presence waiver or before an immigrant visa is issued, reenters or attempts to reenter the United States without being inspected and admitted or paroled.
Federal Energy Regulatory Commission, Energy.
Notice of proposed rulemaking.
The Federal Energy Regulatory Commission (Commission) proposes to approve seven critical infrastructure protection (CIP) Reliability Standards: CIP-003-6 (Security Management Controls), CIP-004-6 (Personnel and Training), CIP-006-6 (Physical Security of BES Cyber Systems), CIP-007-6 (Systems Security Management), CIP-009-6 (Recovery Plans for BES Cyber Systems), CIP-010-2 (Configuration Change Management and Vulnerability Assessments), and CIP-011-2 (Information Protection). The North American Electric Reliability Corporation (NERC) submitted the proposed Reliability Standards in response to the Commission's Order No. 791. The proposed Reliability Standards address the cyber security of the bulk electric system and improve upon the current Commission-approved CIP Reliability Standards. In addition, the Commission proposes to direct NERC to develop certain modifications to Reliability Standard CIP-006-6 and to develop requirements addressing supply chain management.
Comments are due September 21, 2015.
Comments, identified by docket number, may be filed in the following ways:
• Electronic Filing through
•
1. Pursuant to section 215 of the Federal Power Act (FPA),
2. The proposed Reliability Standards are designed to mitigate the cybersecurity risks to bulk electric system facilities, systems, and equipment, which, if destroyed, degraded, or otherwise rendered unavailable as a result of a cybersecurity incident, would affect the reliable operation of the Bulk-Power System.
3. In addition, pursuant to FPA section 215(d)(5), the Commission proposes to direct NERC to develop certain modifications to Reliability Standard CIP-006-6. Specifically, while proposed CIP-006-6 would require protections for communication networks among a limited group of bulk electric system Control Centers, we propose to direct that NERC modify Reliability Standard CIP-006-6 to require protections for communication network components and data communicated between all bulk electric system Control Centers. In addition, we seek comment on the sufficiency of the security controls incorporated in the current CIP Reliability Standards regarding remote access used in relation to bulk electric system communications. Finally, as discussed in more detail below, we propose to direct NERC to develop requirements relating to supply chain management for industrial control system hardware, software, and services.
4. Section 215 of the FPA requires a Commission-certified ERO to develop mandatory and enforceable Reliability Standards, subject to Commission review and approval. Reliability Standards may be enforced by the ERO, subject to Commission oversight, or by the Commission independently.
5. On November 22, 2013, in Order No. 791, the Commission approved the CIP version 5 Standards (Reliability Standards CIP-002-5 through CIP-009-5, and CIP-010-1 and CIP-011-1).
6. In addition, the Commission directed NERC to conduct a survey of Cyber Assets that are included or excluded under the new BES Cyber Asset definition and submit an informational filing within one year.
7. On February 3, 2015, NERC submitted an informational filing assessing the results of a survey conducted to identify the scope of assets subject to the definition of the term BES Cyber Asset as it is applied in the CIP version 5 Standards. NERC states that the results of the survey indicate that, in general, the application of the BES Cyber Asset definition, and the 15 minute parameter in particular, resulted in the identification of BES Cyber Assets consistent with the language and intent of the CIP version 5 Standards.
8. On April 29, 2014, a staff-led technical conference was held pursuant to a directive in Order No. 791.
9. With respect to the current state of protection for communications networks under the CIP version 5 Standards, some panelists opined that the CIP version 5 Standards lack controls to: (1) Protect communications outside of the Electronic Security Perimeter; (2) protect data in motion; (3) authenticate messages and commands to BES Cyber Assets; and (4) protect systems or communications using non routable protocols. On the subject of the adequacy of protections for Bulk-Power System data under the CIP version 5 Standards, several panelists stated that stronger measures, such as encryption, would enhance the overall protection for Bulk-Power System communications. However, other panelists also stated that encryption was not a universal solution because it could cause unacceptable latency (
10. Regarding the need for additional security controls for Bulk-Power System communications, panelists identified a number of worthwhile steps that could be explored to enhance remote access. Suggestions included the adoption of additional physical security controls, integrity checks, encryption (in certain cases), out of bounds detection for communications links, and coordination with vendors to enhance risk management. In addition, certain panelists stated their position that the use of intermediate systems, alone, is not sufficient to address remote access concerns.
11. On February 13, 2015, NERC submitted a petition seeking approval of Reliability Standards CIP-003-6, CIP-004-6, CIP-006-6, CIP-007-6, CIP-009-6, CIP-010-2, and CIP-011-2, as well as the proposed implementation plan,
12. NERC avers that the proposed CIP Reliability Standards satisfy the Commission directives in Order No. 791. Specifically, NERC states that the proposed Reliability Standards remove the “identify, assess, and correct” language, which represents the Commission's preferred approach to addressing the underlying directive.
13. With regard to the Commission's directive that NERC develop specific controls to protect transient electronic devices (
14. Accordingly, NERC requests that the Commission approve the proposed Reliability Standards, the proposed implementation plan, the associated violation risk factor and violation severity level assignments, and the proposed new and revised definitions. NERC requests an effective date for the Reliability Standards of the later of April 1, 2016 or the first day of the first calendar quarter that is three months after the effective date of the Commission's order approving the proposed Reliability Standard, although NERC proposes that responsible entities will not have to comply with the requirements applicable to Low Impact BES Cyber Systems (CIP-003-6, Requirement R1, Part 1.2 and Requirement R2) until April 1, 2017.
15. Pursuant to section 215(d)(2) of the FPA, we propose to approve Reliability Standards CIP-003-6, CIP-004-6, CIP-006-6, CIP-007-6, CIP-009-6, CIP-010-2 and CIP-011-2 as just, reasonable, not unduly discriminatory or preferential, and in the public interest. In addition, pursuant to FPA section 215(d)(5), we propose to direct NERC to develop certain modifications to Reliability Standard CIP-006-6 and to develop requirements addressing supply chain management.
16. The proposed Reliability Standards address the Commission's directives from Order No. 791 and are an improvement over the current Commission-approved CIP Reliability Standards. Specifically, we propose to approve the removal of the “identify, assess, and correct” language in certain requirements of the CIP version 5 Standards. We also propose to approve NERC's submission regarding the protection of Low Impact BES Cyber Systems. With regard to the directive to create a NERC Glossary definition for the term “communication networks,” we propose to approve NERC's proposal as an equally effective and efficient method to achieve the reliability goal underlying that directive in Order No. 791.
17. The technical controls in proposed Reliability Standard CIP-006-6, which addresses the protection of non-programmable components of communication networks (
18. Separately, we are concerned that changes in the bulk electric system cyber threat landscape, identified through recent malware campaigns targeting supply chain vendors, have highlighted a gap in the protections under the CIP Reliability Standards. These malware campaigns represent a new type of threat to the reliability of the bulk electric system where malicious code can infect the software of industrial control systems used by responsible entities. Therefore, we propose to direct NERC to develop a new Reliability Standard or modified Reliability Standard to provide security controls for supply chain management for industrial control system hardware, software, and services associated with bulk electric system operations.
19. We also propose to approve the new or revised definitions for inclusion in the NERC Glossary, and seek comment on the proposed definition for Low Impact External Routable Connectivity. Depending on the comments received, we may direct NERC to develop modifications to this definition to eliminate possible ambiguities and ensure that BES Cyber Assets receive adequate protection.
20. In addition, we propose to accept 19 violation risk factor and violation severity level assignments associated with the proposed Reliability Standards. Finally, we propose to approve NERC's proposed implementation plan and effective date. Below, we discuss the following matters: (A) Identify, assess, and correct language; (B) enhanced security controls for Low Impact assets; (C) protection of Transient Devices; (D) protection of bulk electric system communication networks; (E) supply chain management; (F) proposed definitions; (G) NERC's proposed implementation plan; and (H) proposed violation severity level and violation risk factor assignments.
21. In the proposed CIP version 5 Standards, NERC included language in 17 CIP requirements that would have required responsible entities to implement requirements in a manner to “identify, assess, and correct” deficiencies.
22. In its Petition, NERC explains that it has addressed the Order No. 791 directive regarding the “identify, assess, and correct” language by removing the language from the 17 requirements that included the language in the CIP version 5 Standards.
23. NERC's proposal to remove the “identify, assess, and correct” language from the 17 requirements that included the language in the CIP version 5 Standards, while retaining the substantive provisions of those requirements, reflects the Commission's preferred approach outlined in Order No. 791.
24. Accordingly, we propose to approve NERC's removal of the “identify, assess, and correct” language from the 17 affected requirements.
25. In Order No. 791, the Commission approved NERC's new approach to categorizing BES Cyber Systems based on the High, Medium or Low Impact that each system could have on the reliable operation of the bulk electric system. Specifically, the Commission noted that the new tiered approach, “which requires at least a minimum classification of Low Impact for BES
26. While not directing NERC to develop specific controls for Low Impact BES Cyber Systems, the Commission noted that NERC could address the lack of objective criteria in a number of ways, including: (1) Requiring specific controls for Low Impact assets, including subdividing the assets into different categories with different defined controls applicable to each subcategory; (2) developing objective criteria against which the controls adopted by responsible entities can be compared and measured in order to evaluate their adequacy, including subdividing the assets into different categories with different defined control objectives applicable to each subcategory; (3) defining with greater specificity the processes that responsible entities must have for Low Impact facilities under Reliability Standard CIP-003-5, Requirement R2; or (4) another equally efficient and effective solution.
27. In its Petition, NERC states that the revised CIP Reliability Standards include “additional specificity regarding the controls that responsible entities must implement for protecting their low impact BES Cyber Systems.”
28. In addition, NERC explains that proposed Reliability Standard CIP-003-6, Requirement R2 requires responsible entities with Low Impact BES Cyber Systems to implement controls necessary to meet specific security objectives for: (1) Cyber security awareness; (2) physical security controls; (3) electronic access controls; and (4) cyber security incident response. NERC explains further that while the four topics addressed by Reliability Standard CIP-003-6, Requirement R2 are the same as those under the CIP version 5 Standards, focusing resources on the four identified subject matter areas “will have the greatest cybersecurity benefit for low impact BES Cyber Systems without diverting resources necessary for the protection of high and medium impact BES Cyber Systems.”
29. NERC explains further that proposed Reliability Standard CIP-003-6, Requirement R2 provides responsible entities with flexibility to adopt security controls for Low Impact BES Cyber Systems “in the manner that best suits the needs and characteristics of their organization, so long as the responsible entity can demonstrate that it designed its controls to meet the ultimate security objective.”
30. We propose to approve proposed Reliability Standard CIP-003-6. NERC's proposal satisfies the Commission's Order No. 791 directive by providing responsible entities with a list of specific security objectives relevant to Low Impact BES Cyber Systems that must be addressed through one or more documented cyber security plans. Reliability Standard CIP-003-6, Requirement R2 provides clarity regarding what is expected for compliance and requires responsible entities to implement specific security controls to meet the four subject matter areas identified by NERC to address the risks associated with Low Impact BES Cyber Systems, providing enhanced protections for Low Impact assets.
31. As noted above, Attachment 1 to revised CIP-003-6, Requirement R2 identifies four topics addressed by the requirement, and describes the affirmative obligations associated with each topic, including: (1) Mandatory reinforcement of cyber security awareness practices at least once every 15 calendar months; (2) mandatory physical access controls to the asset or locations of the Low Impact BES Cyber Systems within the asset and Low Impact BES Cyber System Electronic Access Points, if any; (3) mandatory electronic access point protection to permit only necessary inbound and outbound bi-directional routable protocol access and mandatory authentication for all dialup connectivity that provides access to the Low Impact BES Cyber System; and (4) specific information to be included in
32. Furthermore, we agree that NERC's proposal to use clear security objectives in lieu of specific security controls for each Low Impact system is reasonable owing to the diversity of assets covered under the Low Impact category. With respect to the security subject matter areas covered under proposed CIP-003-6, we believe that NERC's proposal is reasonable in relation to the risk posed by Low Impact BES Cyber Systems, as well as the diversity of systems captured by the Low Impact category. Therefore, we propose to approve proposed Reliability Standard CIP-003-6.
33. In Order No. 791, the Commission approved the proposed definition of BES Cyber Asset that provides, in part, that “[a] Cyber Asset is not a BES Cyber Asset if, for 30 consecutive calendar days or less, it is directly connected to a network within an [Electronic Security Perimeter], a Cyber Asset within an [Electronic Security Perimeter], or to a BES Cyber Asset, and it is used for data transfer, vulnerability assessment, maintenance, or troubleshooting purposes.”
34. While accepting the 30-day exemption in the BES Cyber Asset definition, the Commission reiterated its concern whether the provisions of the CIP version 5 Standards “provide adequately robust protection from the risks posed by transient devices.”
35. In its Petition, NERC states that the revised CIP Reliability Standards satisfy the Commission's directive in Order No. 791 by requiring that applicable entities: (1) Develop plans and implement cybersecurity controls to protect Transient Cyber Assets and Removable Media associated with their High Impact and Medium Impact BES Cyber Systems and associated Protected Cyber Assets; and (2) train their personnel on the risks associated with using Transient Cyber Assets and Removable Media. NERC states that the purpose of the proposed revisions is to prevent unauthorized access to and use of transient devices, mitigate the risk of vulnerabilities associated with unpatched software on transient devices, and mitigate the risk of the introduction of malicious code on transient devices. NERC explains that the standard drafting team determined that the proposed requirements should only apply to transient devices associated with High and Medium Impact BES Cyber Systems, concluding that “the application of the proposed transient devices requirements to transient devices associated with low impact BES Cyber Systems was unnecessary, and likely counterproductive, given the risks low impact BES Cyber Systems present to the Bulk Electric System.”
36. NERC proposes to add two terms to the NERC Glossary, Transient Cyber Asset and Removable Media, to clarify the types of transient devices subject to the CIP Reliability Standards. NERC also proposes to revise the definitions for BES Cyber Asset and Protected Cyber Asset to remove the 30-day exemption as the proposed definition for Transient Cyber Assets obviates the need for the 30-day exemption language. NERC indicates that, as defined, Transient Cyber Assets and Removable Media do not provide reliability services and are not part of the BES Cyber System to which they are connected.
37. NERC proposes to define Transient Cyber Asset as: “A Cyber Asset that (i) is capable of transmitting or transferring executable code, (ii) is not included in a BES Cyber System, (iii) is not a Protected Cyber Asset (PCA) and (iv) is directly connected (
38. NERC proposes to define the term Removable Media as: “Storage media that (i) are not Cyber Assets, (ii) are capable of transferring executable code, (iii) can be used to store, copy, move, or access data, and (iv) are directly connected for 30 consecutive calendar days or less to a BES Cyber Asset, a network within an [Electronic Security Perimeter] or a Protected Cyber Asset. Examples include but are not limited to floppy disks, compact disks, USB flash drives, external hard drives and other flash memory cards/drives that contain nonvolatile memory.”
39. NERC explains that proposed Reliability Standard CIP-010-2, Requirement R4 requires entities to document and implement a plan for managing and protecting Transient Cyber Assets and Removable Media in order to protect BES Cyber Systems from the risks associated with transient devices. Specifically, Requirement R4 provides that “[e]ach responsible entity for its high impact and medium impact BES Cyber Systems and associated Protected Cyber Assets, shall implement, except under CIP Exceptional Circumstances, one or more documented plans for Transient Cyber
40. NERC further explains that Attachment 1 to CIP-010-2, Requirement R4 requires a responsible entity to adopt controls to address the following areas: (1) Protections for Transient Cyber Assets managed by responsible entities; (2) protections for Transient Cyber Assets managed by another party; and (3) protections for Removable Media. NERC indicates that these provisions reflect the standard drafting team's recognition that the security controls required for a particular transient device must account for (1) the functionality of that device and (2) whether the responsible entity or a third party manages the device. NERC also states that, because Transient Cyber Assets and Removable Media have different capabilities, they present different levels of risk to the bulk electric system.
41. Based on our review, proposed Reliability Standard CIP-010-2 appears to provide a satisfactory level of security for transient devices used at High and Medium Impact BES Cyber Systems. As described above, proposed Reliability Standard CIP-010-2, Requirement R4 addresses the following security elements: (1) Device authorization; (2) software authorization; (3) security patch management; (4) malware prevention; and (5) unauthorized use. The proposed security controls, taken together, constitute a reasonable approach to address the reliability objectives outlined by the Commission in Order No. 791. The proposed security controls outlined in Attachment 1 should ensure that responsible entities apply multiple security controls to provide defense-in-depth protection to transient devices (
42. We are concerned, however, that NERC's proposed revisions do not provide adequate security controls to address the risks posed by transient devices used at Low Impact BES Cyber Systems, including Low Impact control centers, due to the limited applicability of Requirement R4. We believe that this omission may result in a gap in protection for Low Impact BES Cyber Systems. For example, malware inserted via a USB flash drive at a single Low Impact substation could propagate through a network of many substations without encountering a single security control under NERC's proposal. In addition, we note that Low Impact security controls do not provide for the use of mandatory anti-malware/antivirus protections within the Low Impact facilities, heightening the risk that malware or malicious code could propagate through these systems without being detected.
43. We do not believe that NERC has provided an adequate justification to limit the applicability of Reliability Standard CIP-010-2. In its petition, NERC states that “the application of the proposed transient devices requirements to transient devices associated with low impact BES Cyber Systems was unnecessary, and likely counterproductive, given the risks low impact BES Cyber Systems present to the Bulk Electric System.”
44. In Order No. 791, the Commission approved a revised definition of the NERC Glossary term Cyber Asset, including the removal of the phrase “communication networks.” In reaching its decision, the Commission recognized that maintaining the phrase “communication networks” in the definition of “cyber asset” could cause confusion and potentially complicate implementation of the CIP version 5 Standards “as many communication network components, such as cabling, cannot strictly comply with the CIP Reliability Standards.”
45. However, while the Commission approved the revised Cyber Asset definition, the Commission also directed NERC to create a definition of communication networks. Specifically, the Commission stated that “[t]he definition of communication networks should define what equipment and components should be protected, in light of the statutory inclusion of communication networks for the reliable operation of the Bulk-Power System.”
46. The Commission also directed NERC to develop new or modified Reliability Standards to address the reliability gap resulting from the removal of the phrase “communication networks” from the Cyber Asset definition. Specifically, the Commission found that a gap in protection may exist since the CIP version 5 Standards “do not address security controls needed to protect the nonprogrammable components of communication networks.”
47. In its petition, NERC states that the standard drafting team concluded that it did not need to create a new definition for communication networks to address the Commission's concerns. NERC explains that the term communication network “is generally understood to encompass both programmable and nonprogrammable components (
48. NERC states that the revised CIP Reliability Standards, as proposed, address the ultimate security objective of protecting both the programmable and nonprogrammable components of communication networks.
49. NERC explains that proposed Reliability Standard CIP-006-6, Requirement R1, Part 1.10 provides that, for High and Medium Impact BES Cyber Systems and their associated Protected Cyber Assets, responsible entities must restrict physical access to cabling and other nonprogrammable communication components used for connection between covered Cyber Assets within the same Electronic Security Perimeter in those instances when such cabling and components are located outside of a Physical Security Perimeter. NERC explains further that, where physical access restrictions to such cabling and components are not feasible, Part 1.10 provides that the responsible entity must document and implement encryption of data transmitted over such cabling and components and/or monitor the status of the communication link composed of such cabling and components. Further, pursuant to Part 1.10, a responsible entity must issue an alarm or alert in response to detected communication failures to the personnel identified in the BES Cyber Security Incident response plan within 15 minutes of detection, or implement an equally effective logical protection.
50. NERC states that proposed Reliability Standard CIP-006-6 provides flexibility for responsible entities to implement the physical security measures that best suit their needs and to account for configurations where logical measures are necessary because the entity cannot implement physical access restrictions effectively. Responsible entities have the discretion as to the type of physical or logical protections to implement pursuant to Part 1.10, provided that the protections are designed to meet the overall security objective. According to NERC, the protections required by Part 1.10 will reduce the possibility of tampering and the likelihood that “man-in-the-middle” attacks could compromise the integrity of BES Cyber Systems or Protected Cyber Assets at control centers with High or Medium Impact BES Cyber Systems.
51. NERC explains that proposed Part 1.10 applies only to nonprogrammable components outside of a Physical Security Perimeter because nonprogrammable components located within a Physical Security Perimeter are already subject to physical security protections by virtue of their location. NERC further states that Part 1.10 only applies to nonprogrammable components used for connection between applicable Cyber Assets within the same Electronic Security Perimeter because Reliability Standard CIP-005-5 already requires logical protections for communications between discrete Electronic Security Perimeters.
52. In addition, NERC asserts that the proposed Reliability Standards will strengthen the defense-in-depth approach by further minimizing the “attack surface” of BES Cyber Systems. NERC also clarifies that the standard drafting team limited the applicability in this manner to clarify that responsible entities are not responsible for protecting nonprogrammable communication components outside of the responsible entity's control (
53. We believe that NERC's proposed alternative approach to addressing the Commission's Order No. 791 directive regarding the definition of communication networks adequately addresses part of the underlying concerns set forth in Order No. 791. Proposed Reliability Standard CIP-006-6, Requirement R1.10 specifies the types of assets subject to mandatory protection by using the existing definitions of Electronic Security Perimeter
54. We propose to accept NERC's proposed omission of a definition of communication networks based on NERC's explanation that responsible entities must develop controls to secure the non-programmable components of communication networks based on the risk they pose to the bulk electric system, rather than develop a specific definition of communication networks to identify assets for protection. NERC's proposal is an equally efficient and effective solution to the Commission's directive in Order No. 791 that NERC develop a definition of communication networks, subject to the proposed modification discussed below.
55. NERC's proposed solution for the protection of nonprogrammable components of communication networks, however, does not fully meet the intent of the Commission's Order No. 791 directive, resulting in a gap in security for bulk electric system communication systems. While the technical substance of CIP-006-6, Requirement R1, Part 1.10 appears to be adequate, we are concerned that the limited applicability of the provision results in limited protection for the nonprogrammable components of the communication systems at issue. Specifically, proposed CIP-006-6, Requirement R1, Part 1.10 would only apply to nonprogrammable components of communication networks within the same Electronic Security Perimeter, excluding from protection other programmable and non-programmable communication network components that may exist outside of a discrete Electronic Security Perimeter.
56. While NERC asserts that this limitation is justified by the controls required under Reliability Standard CIP-005-5, NERC's position does not appear to consider that the controls set forth in Reliability Standard CIP-005-5 are limited to interactive remote access into an Electronic Security Perimeter, and can only be applied on programmable electronic devices and data that exists within an Electronic Security Perimeter.
57. Comments from participants at the April 29, 2014 Technical Conference suggest that the Commission should take action to ensure the confidentiality, integrity, and availability of sensitive bulk electric system data when it is in motion both inside and outside of an Electronic Security Perimeter.
58. We also recognize that third party communication infrastructure (
59. Therefore, pursuant to section 215(d)(5) of the FPA, we propose to direct NERC to develop a modification to proposed Reliability Standard CIP-006-6 to require responsible entities to implement controls to protect, at a minimum, all communication links and sensitive bulk electric system data communicated between all bulk electric system Control Centers. This includes communication between two (or more) Control Centers, but not between a Control Center and non-Control Center facilities such as substations. Also, if latency concerns mitigate against use of encryption as a logical control for any inter-Control Center communications, our understanding is that other logical protections are available, and we seek comment on this point.
60. Further, as discussed at the April 29, 2014 technical conference, panelists identified suggestions that could be explored to enhance protections for remote access, including the addition of logical or physical controls to provide additional network segmentation behind the intermediate systems. For example, the Commission is interested in comments that address the value achieved if the CIP standards were to require the incorporation of additional network segmentation controls, connection monitoring, and session termination controls behind responsible entity intermediate systems. We seek comment on whether these or other steps to improve remote access protection are needed, and whether the adoption of any additional security controls addressing this topic would provide substantial reliability and security benefits.
61. The information and communications technology and industrial control system supply chains provide hardware, software and operations support for computer networks. Such supply chains are complex, globally distributed and interconnected systems that have geographically diverse routes and consist of multiple tiers of outsourcing. The supply chain includes public and private sector entities that depend on each other to develop, integrate, and use information and communications technology and industrial control system supply chain products and services. Thus, the supply chain provides the opportunity for significant benefits to customers, including low cost, interoperability, rapid innovation, a variety of product features and choice.
62. However, the global supply chain also enables opportunities for adversaries to directly or indirectly affect the management or operations of companies that may result in risks to the end user. Supply chain risks may include the insertion of counterfeits, unauthorized production, tampering, theft, or insertion of malicious software, as well as poor manufacturing and development practices. To address these risks, NIST developed SP 800-161
63. While the Commission did not address supply chain management in Order No. 791, changes in the bulk electric system cyber threat landscape identified through recent malware campaigns targeting supply chain vendors have highlighted a gap in the protections under the CIP Standards. Specifically, in 2014, after Order No. 791 was issued, the Industry Control System—Computer Emergency Readiness Team (ICS-CERT) reported on two focused malware campaigns.
64. We believe that it is reasonable to direct NERC to develop a new or modified Reliability Standard to provide security controls for supply chain management for industrial control system hardware, software, and computing and networking services associated with bulk electric system operations. The reliability goal should be to create a forward-looking, objective-driven standard that encompasses activities in the system development life cycle: from research and development, design and manufacturing stages (where applicable), to acquisition, delivery, integration, operations, retirement, and eventual disposal of the Registered Entity's information and communications technology and industrial control system supply chain equipment and services. The standard should support and ensure security, integrity, quality, and resilience of the supply chain and the future acquisition of products and services.
65. Since security controls for supply chain management will likely vary greatly with each responsible entity due to variations in individual business practices, the right set of supply chain management security controls should accommodate for, among other things, an entity's: (1) Procurement process; (2) vendor relations; (3) system requirements; (4) information technology implementation; and (5) privileged commercial or financial information. The following Supply Chain Risk Management controls from NIST SP 800-161 may be instructional in the development of any new reliability standard to address this security topic:
66. Therefore, pursuant to section 215(d)(5) of the FPA, we propose to direct NERC to develop a new reliability standard or modified reliability standard to provide security controls for supply chain management for industrial control system hardware, software, and services associated with bulk electric system operations. In addition to the parameters discussed above, due to the broadness of the topic and the individualized nature of many aspects of supply chain management, we anticipate that a Reliability Standard pertaining to supply chain management security would:
• Respect section 215 jurisdiction by only addressing the obligations of registered entities. A reliability standard should not directly impose obligations on suppliers, vendors or other entities that provide products or services to registered entities.
• Be forward-looking in the sense that the reliability standard should not dictate the abrogation or re-negotiation of currently-effective contracts with vendors, suppliers or other entities.
• Recognize the individualized nature of many aspects of supply chain management by setting goals (the “what”), while allowing flexibility in how a registered entity subject to the standard achieves that goal (the “how”).
• Given the types of specialty products involved and diversity of acquisition processes, the standard may need to allow exceptions,
• Provide enough specificity so that compliance obligations are clear and enforceable. In particular, we anticipate that a reliability standard that simply requires a registered entity to “have a plan” addressing supply chain management would not suffice. Rather, to adequately address our concerns, we believe that a reliability standard should identify specific controls. As discussed above, NIST SP 800-161 may be instructional in identifying appropriate controls in the development of an effective supply chain management reliability standard.
We recognize that developing a supply chain management standard would likely be a significant undertaking and require extensive engagement with stakeholders to define the scope, content, and timing of the standard. Accordingly, to further that stakeholder engagement, we seek comment on this proposal, including: (1) The general proposal to direct that NERC develop a Reliability Standard to address supply chain management; (2) the anticipated features of, and requirements that should be included in, such a standard; and (3) a reasonable timeframe for development of a standard. We also direct staff, after receipt and consideration of those comments, to engage in additional outreach to further the Commission's consideration of the need for, and scope, content, and timing of, a supply chain management standard.
67. The proposed revised CIP Reliability Standards include six new or revised definitions for inclusion in the NERC glossary. NERC's proposal includes four new definitions and two revised definitions. Specifically, NERC seeks approval for the following terms: (1) BES Cyber Asset; (2) Protected Cyber Asset; (3) Low Impact Electronic Access Point; (4) Low Impact External Routable Connectivity; (5) Removable Media; and (6) Transient Cyber Asset. We propose to approve the proposed definitions for inclusion in the NERC Glossary. We also seek comment on certain aspects of the proposed definition for Low Impact External Routable Connectivity, as discussed below. After receiving
68. In its petition, NERC proposes the following definition for Low Impact External Routable Connectivity:
Direct user-initiated interactive access or a direct device-to-device connection to a low impact BES Cyber System(s) from a Cyber Asset outside the asset containing those low impact BES Cyber System(s) via a bidirectional routable protocol connection. Point-to-point communications between intelligent electronic devices that use routable communication protocols for time-sensitive protection or control functions between Transmission station or substation assets containing low impact BES Cyber Systems are excluded from this definition (examples of this communication include. but are not limited to, IEC 61850 GOOSE or vendor proprietary protocols).
69. NERC explains that the proposed definition describes the scenarios where responsible entities are required to apply Low Impact access controls under Reliability Standard CIP-003-6, Requirement R2 to their Low Impact assets. Specifically, if Low Impact External Routable Connectivity is used, a responsible entity must implement a Low Impact Electronic Access Point to permit only necessary inbound and outbound bidirectional routable protocol access.
70. We seek comment on the following aspects of the proposed definition. First, we seek comment on the purpose of the meaning of the term “direct” in relation to the phrases “direct user-initiated interactive access” and “direct device-to-device connection” within the proposed definition. In addition, we seek comment on the implementation of the “layer 7 application layer break” contained in certain reference diagrams in the Guidelines and Technical Basis section of proposed Reliability Standard CIP-003-6.
71. NERC's proposed implementation plan for the proposed Reliability Standards is designed to match the effective dates of the proposed Reliability Standards with the effective dates of the prior versions of the related Reliability Standards under the implementation plan of the CIP version 5 Standards. NERC states that the purpose of this approach is to provide regulatory certainty by limiting the time, if any, that the CIP version 5 Standards with the “identify, assess, and correct” language would be effective. Specifically, pursuant to the CIP version 5 implementation plan, the effective date of each of the CIP version 5 Standards is April 1, 2016, except for the effective date for Requirement R2 of CIP-003-5, which is April 1, 2017. Consistent with those dates, the proposed implementation plan provides that: (1) each of the proposed reliability Standards shall become effective on the later of April 1, 2016 or the first day of the first calendar quarter that is three months after the effective date of the Commission's order approving the proposed Reliability Standard; and (2) responsible entities will not have to comply with the requirements applicable to Low Impact BES Cyber Systems (CIP-003-6, Requirement R1, Part 1.2 and Requirement R2) until April 1, 2017.
72. NERC's proposed implementation plan also includes effective dates for the new and modified definitions associated with: (1) transient devices (
73. We propose to approve NERC's implementation plan for the proposed CIP Reliability Standards, as described above.
74. NERC requests approval of the violation risk factors and violation severity levels assigned to the proposed Reliability Standards. Specifically, NERC requests approval of 19 violation risk factor and violation severity level assignments associated with the proposed Reliability Standards.
75. The FERC-725B information collection requirements contained in this Proposed Rule are subject to review by the Office of Management and Budget (OMB) under section 3507(d) of the Paperwork Reduction Act of 1995.
76. The Commission based its paperwork burden estimates on the changes in paperwork burden presented by the proposed CIP Reliability Standards as compared to the CIP version 5 Standards. The Commission has already addressed the burden of implementing the CIP version 5 Standards.
77. The NERC Compliance Registry, as of June 2015, identifies approximately 1,435 U.S. entities that are subject to mandatory compliance with Reliability Standards. Of this total, we estimate that 1,363 entities will face an increased paperwork burden under the proposed CIP Reliability Standards, and we estimate that a majority of these entities will have one or more Low Impact assets. In addition, we estimate that approximately 23 percent of the entities have assets that will be subject to Reliability Standards CIP-006-6 and CIP-010-2. Based on these assumptions, we estimate the following reporting burden:
78. The following shows the annual cost burden for each group, based on the burden hours in the table above:
• Year 1: Entities subject to CIP-006-6 and CIP-010-2 with Medium and/or High Impact Assets: 313 × 240 hours/entity * $76/hour = $5,709,120.
• Years 2 and 3: 313 entities × 416 hours/entity * $76/hour = $9,895,808 per year.
• The paperwork burden estimate includes costs associated with the initial development of a policy to address requirements relating to transient devices, as well as the ongoing data collection burden. Further, the estimate reflects the assumption that costs incurred in year 1 will pertain to policy development, while costs in years 2 and 3 will reflect the burden associated with maintaining logs and other records to demonstrate ongoing compliance.
79. The following shows the annual cost burden for each group, based on the burden hours in the table above:
• Year 1: Entities subject to CIP-003-6 with Low Impact Assets: 1,363 × 120 hours/entity * $76/hour = $12,430,560.
• Years 2 and 3: 1,363 entities × 208 hours/entity * $76/hour = $21,546,304 per year.
• The paperwork burden estimate includes costs associated with the modification of existing policies to address requirements relating to low impact assets, as well as the ongoing data collection burden, as set forth in CIP-003-6, Requirements R1.2 and R2, and Attachment 1. Further, the estimate reflects the assumption that costs incurred in year 1 will pertain to revising existing policies, while costs in years 2 and 3 will reflect the burden associated with maintaining logs and other records to demonstrate ongoing compliance.
80. The estimated hourly rate of $76 is the average loaded cost (wage plus benefits) of legal services ($129.68 per hour), technical employees ($58.17 per hour) and administrative support ($39.12 per hour), based on hourly rates and average benefits data from the Bureau of Labor Statistics.
81.
82. Interested persons may obtain information on the reporting requirements by contacting the following: Federal Energy Regulatory Commission, 888 First Street NE., Washington, DC 20426 [Attention: Ellen Brown, Office of the Executive Director, email:
83. For submitting comments concerning the collection(s) of information and the associated burden estimate(s), please send your comments to the Commission, and to the Office of Management and Budget, Office of
84. The Regulatory Flexibility Act of 1980 (RFA) generally requires a description and analysis of Proposed Rules that will have significant economic impact on a substantial number of small entities.
85. Of the 1,363 affected entities discussed above, we estimate that 444 entities are small entities. We estimate that 399 of these 444 small entities do not own BES Cyber Assets or BES Cyber Systems that are classified as Medium or High Impact and, therefore, will only be affected by the proposed modifications to Reliability Standard CIP-003-6. As discussed above, proposed Reliability Standard CIP-003-6 enhances reliability by providing criteria against which NERC and the Commission can evaluate the sufficiency of an entity's protections for Low Impact BES Cyber Assets. We estimate that each of the 399 small entities to whom the proposed modifications to Reliability Standard CIP-003-6 applies will incur one-time costs of approximately $149,358 per entity to implement this standard, as well as the ongoing paperwork burden reflected in the Information Collection Statement (approximately $15,000 per year per entity). We do not consider the estimated costs for these 399 small entities a significant economic impact.
86. In addition, we estimate that 14 small entities own Medium Impact substations and that 31 small transmission operators own Medium or High impact control centers. These 45 small entities represent 10.1 percent of the 444 affected small entities. We estimate that each of these 45 small entities may experience an economic impact of $50,000 per entity in the first year of initial implementation to meet proposed Reliability Standard CIP-010-2 and $30,000 in ongoing annual costs,
87. Based on the above analysis, we propose to certify that the proposed Reliability Standards will not have a significant economic impact on a substantial number of small entities.
88. The Commission is required to prepare an Environmental Assessment or an Environmental Impact Statement for any action that may have a significant adverse effect on the human environment.
89. The Commission invites interested persons to submit comments on the matters and issues proposed in this notice to be adopted, including any related matters or alternative proposals that commenters may wish to discuss. Comments are due September 21, 2015. Comments must refer to Docket No. RM15-14-000, and must include the commenter's name, the organization they represent, if applicable, and address.
90. The Commission encourages comments to be filed electronically via the eFiling link on the Commission's Web site at
91. Commenters that are not able to file comments electronically must send an original of their comments to: Federal Energy Regulatory Commission, Secretary of the Commission, 888 First Street NE., Washington, DC 20426.
92. All comments will be placed in the Commission's public files and may be viewed, printed, or downloaded remotely as described in the Document Availability section below. Commenters on this proposal are not required to serve copies of their comments on other commenters.
93. In addition to publishing the full text of this document in the
94. From the Commission's Home Page on the Internet, this information is available on eLibrary. The full text of this document is available on eLibrary in PDF and Microsoft Word format for viewing, printing, and/or downloading. To access this document in eLibrary, type the docket number of this document, excluding the last three digits, in the docket number field.
User assistance is available for eLibrary and the Commission's Web site during normal business hours from the Commission's Online Support at (202) 502-6652 (toll free at 1-866-208-3676) or email at
By direction of the Commission.
Bureau of Prisons, Justice.
Proposed rule.
In this document, the Bureau of Prisons (Bureau) proposes revisions to the Residential Drug Abuse Treatment Program (RDAP) regulations to allow greater inmate participation in the program and positively impact recidivism rates.
Comments are due by September 21, 2015.
The public is encouraged to submit comments on this proposed rule using the
Sarah Qureshi, Office of General Counsel, Bureau of Prisons, phone (202) 307-2105.
Please note that all comments received are considered part of the public record and made available for public inspection online at
If you want to submit personal identifying information (such as your name, address, etc.) as part of your comment, but do not want it to be posted online, you must include the phrase “PERSONAL IDENTIFYING INFORMATION” in the first paragraph of your comment. You must also locate all the personal identifying information you do not want posted online in the first paragraph of your comment and identify what information you want redacted.
If you want to submit confidential business information as part of your comment but do not want it to be posted online, you must include the phrase “CONFIDENTIAL BUSINESS INFORMATION” in the first paragraph of your comment. You must also prominently identify confidential business information to be redacted within the comment. If a comment has so much confidential business information that it cannot be effectively redacted, all or part of that comment may not be posted on
Personal identifying information identified and located as set forth above will be placed in the agency's public docket file, but not posted online. Confidential business information identified and located as set forth above will not be placed in the public docket file. If you wish to inspect the agency's public docket file in person by appointment, please see the
In this document, the Bureau proposes revisions to the Residential Drug Abuse Treatment Program (RDAP) regulations in four areas to allow greater inmate participation in the program and positively impact recidivism rates. Specifically, the Bureau proposes to (1) remove the regulatory requirement for RDAP written testing because it is more appropriate to assess an inmate's progress through clinical evaluation of behavior change (the written test is no longer used in practice); (2) remove existing regulatory provisions which automatically expel inmates who have committed certain acts (
We likewise propose to make a minor corresponding change in § 550.53(a)(1), which also refers inaccurately to the Drug Abuse Program Coordinator, when instead the course of activities referenced in that regulation is provided by the Psychology Services Department.
In 2010, the Bureau converted the Residential Drug Abuse Treatment Programs to the Modified Therapeutic Community Model of treatment (MTC). This evidenced-based model is designed to assess progress through treatment as determined by the participants' completion of treatment goals and activities on their individualized treatment plan, and demonstrated behavior change. Each participant jointly works with their treatment specialist to create the content of their treatment plan. Every three months, or more often if necessary, each participant meets with their clinical team (four or more treatment staff) to review their progress in treatment. Progress in treatment is determined through assessing the accomplishment of their treatment goals and activities, along with demonstrated behavior change, such as improved personal and social conduct, no disciplinary incidents, etc. Unsatisfactory progress is evident when the participant does not accomplish
There are several studies about the effectiveness of the MTC model of treatment. The most seminal study pertaining to this topic is titled “Outcome Evaluation of A Prison Therapeutic Community for Substance Abuse Treatment.”
This behavioral form of assessing progress is a much more powerful form of assessment than assessing the results of a written test. The written test assesses knowledge, but knowledge does not necessarily demonstrate whether the program has positively affected an individual's behavior or addictive lifestyle.
All of the treatment specialists in the Bureau have a doctorate degree in psychology. They are well qualified to use their knowledge of treatment and the behavior of individuals suffering from substance abuse to objectively determine if a participant is ready to complete the program. There are three decades of evaluation research that support the efficacy of the therapeutic community model of treatment. The most comprehensive source of program description, theory, and summary of research associated with this model of treatment is found in the book entitled
Removing the language would give the Bureau more latitude and clinical discretion when determining which inmates should be expelled from the program. If the language is deleted, inmates will then only be expelled from RDAP according to criteria in § 550.53(g)(1) which allows inmates to be removed from the program by the Drug Abuse Program Coordinator because of disruptive behavior related to the program or unsatisfactory progress in treatment, and requires at least one formal warning before removal, unless there is documented lack of compliance and the inmate's continued presence would present an immediate problem for staff and other inmates.
Removing paragraph (g)(3) removes the automatic expulsion of inmates committing the listed prohibited acts and allows for greater possibility of continuance of the program for inmates with discipline problems.
Title 18 U.S.C. 3621(e) provides the Director of the Bureau of Prisons the discretion to grant an early release of up to one year upon the successful completion of a residential drug abuse treatment program. In exercising the Director's statutory discretion, we considered the crimes of homicide, rape, robbery, aggravated assault, arson, and kidnaping. In the FBI's Uniform Crime Reporting (UCR) Program, violent crime is composed of four offenses: Murder and nonnegligent manslaughter, rape, robbery, and aggravated assault. Violent crimes are defined in the UCR Program as those offenses which involve force or threat of force. The Director exercised his discretion, therefore, to include these categories of violent crimes and also expanded the list to include arson and kidnaping, as they also are crimes of an inherently violent nature and particular dangerousness to the public.
The Director exercises discretion to deny early release eligibility to inmates who have a prior felony or misdemeanor conviction for theses offenses because commission of such offenses rationally reflects the view that such inmates displayed readiness to endanger the public. The UCR explained that “because of the variances in punishment for the same offenses in different state codes, no distinction between felony and misdemeanor crimes was possible.”
The application of national standards to the numerous local, state, tribal, and federal prior convictions promotes uniformity, but creates unique issues since each separate entity will have its own criminal statutory schemes in which offenses may be categorized as either misdemeanors or felonies. Limiting the Bureau to an analysis of how an offense is categorized in local, state, tribal, or federal criminal codes, rather than to an analysis of the nature of the prior offense, would effectively prevent the Director from exercising the discretion authorized by 18 U.S.C. 3621(e). Furthermore, eliminating the analysis of prior violent misdemeanor convictions would allow inmates to receive the benefit of early release merely because of the manner in which the prior convictions were categorized.
Additionally, 28 CFR 550.55(b)(6) provides that inmates who have been convicted of an attempt, conspiracy, or other offense which involved certain underlying offenses are also precluded from early release eligibility. Many state statutes provide that “attempt” convictions are to be categorized as one degree lower than the underlying offense (
Further, based on a random sampling of inmates who participated in RDAP but were precluded from RDAP early release eligibility, the Bureau estimates that of the 856 inmates precluded in the year 2014 based only on convictions for prior offense, at least half that number would have been eligible for early release if the Bureau had not considered prior offenses greater than 10 years old. The Fiscal Year 2015 estimated annual marginal rate to incarcerate an inmate in the Bureau of Prisons is $11,324 per inmate. Based on an estimate of 400 inmates released up to a year early if this proposed rule change is made, that could equate to a cost avoidance of over $4.5 million per year.
We also propose to narrow the language in § 550.55(b)(6) relating to early release eligibility. In § 550.55(b), the Director exercises his discretion to disallow particular categories of inmates from eligibility for early release, including, in (b)(6), those who were convicted of an attempt, conspiracy, or
We propose to narrow the language of § 550.55(b)(6) to preclude only those inmates whose prior conviction involved direct knowledge of the underlying criminal activity and who either participated in or directed the underlying criminal activity. The proposed change would more precisely tailor the regulation to the congressional intent to exclude from early release consideration only those inmates who have been convicted of a violent offense. Furthermore, the changed language would potentially expand early release benefits to more inmates.
Beginning in 1991, in coordination with the National Institute on Drug Abuse, the Bureau conducted a 3-year outcome study of the RDAP. Federal Bureau of Prisons (2000).
The TRIAD study showed that the RDAP program is effective in reducing recidivism. Male participants were 16 percent less likely to recidivate and 15 percent less likely to relapse than similarly situated inmates who do not participate in residential drug abuse treatment for up to 3 years after release. The analysis also found that female inmates who participate in RDAP are 18 percent less likely to recidivate than similarly situated female inmates who do not participate in treatment.
The TRIAD study defined criminal recidivism was defined two ways: (1) An arrest for a new offense or (2) an arrest for a new offense
Offenders who completed the residential drug abuse treatment program and had been released to the community for three years were less likely to be re-arrested or to be detected for drug use than were similar inmates who did not participate in the drug abuse treatment program. Specifically, 44.3 percent of male inmates who completed the program were likely to be re-arrested or revoked within three years after release to supervision in the community, compared to 52.5 percent of those inmates who did not receive such treatment. For women, 24.5 percent of those who completed the residential drug abuse treatment program were arrested or revoked within three years after release, compared to 29.7 percent of the untreated women.
With respect to drug use, 49.4 percent of men who completed treatment were likely to use drugs within 3 years following release, compared to 58.5 percent of those who did not receive treatment. Among female inmates who completed treatment, 35.2 percent were likely to use drugs within the three-year postrelease period in the community, compared to 42.6 percent of those who did not receive such treatment.
In addition to changing “Transitional Drug Abuse Treatment Program (TDAT)” to “Community Treatment Services (CTS)” throughout this regulation as indicated earlier, we also propose to delete paragraph (c) which appears to require that inmates successfully completing RDAP and participating in transitional treatment programming must participate in such programming for one hour per month. The provision in the regulation is an error. It does not relate to Community Treatment Services (CTS), but instead relates to RDAP. It is therefore unnecessary to retain this language. The substance of this language will be retained as implementing text in the relevant policy statement as part of RDAP procedures.
This proposed regulation has been drafted and reviewed in accordance with Executive Order 12866, “Regulatory Planning and Review,” section 1(b), Principles of Regulation, and Executive Order 13563, “Improving Regulation and Regulatory Review.” These executive orders direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility.
The Director, Bureau of Prisons has determined that this proposed rule is a “significant regulatory action” under Executive Order 12866, section 3(f), and accordingly this proposed rule has been reviewed by the Office of Management and Budget.
As context regarding the current impact of the RDAP (
For instance, the change we propose to make to § 550.55(b)(6), regarding changing “other offense” to “solicitation to commit,” based on prior year data (Jan 2014 through Dec 2014), we estimate that approximately 45 inmates would be made eligible for early release as a result of the suggested change.
We will not require more resources in order to put more individuals through RDAP. RDAP is a nine-month program. The program has a treatment capacity large enough to accommodate about 8,400 participants at any given time. Therefore, during a year, program capacity is filled twice, which means that at least 16,800 participants can be accommodated every year. It is not uncommon for more than 16,800 to participate. For example, in FY 2014, approximately 18,000 inmates participated. This number also reflects inmates who may drop out of the program and are replaced with other inmates on the wait list.
This proposed regulation would not have substantial direct effects on the States, on the relationship between the national government and the States, or on distribution of power and responsibilities among the various levels of government. Under Executive Order 13132, this rulemaking does not have sufficient federalism implications
The Director of the Bureau of Prisons, under the Regulatory Flexibility Act (5 U.S.C. 605(b)), reviewed this regulation. By approving it, the Director certifies that it will not have a significant economic impact upon a substantial number of small entities because: This proposed rule is about the correctional management of offenders committed to the custody of the Attorney General or the Director of the Bureau of Prisons, and its economic impact is limited to the Bureau's appropriated funds.
This proposed rule will not cause State, local and tribal governments, or the private sector, to spend $100,000,000 or more in any one year, and it will not significantly or uniquely affect small governments. We do not need to take action under the Unfunded Mandates Reform Act of 1995.
This proposed rule is not a major rule as defined by section 804 of the Small Business Regulatory Enforcement Fairness Act of 1996. This proposed rule would not result in an annual effect on the economy of $100,000,000 or more; a major increase in costs or prices; or significant adverse effects on competition, employment, investment, productivity, innovation, or on the ability of United States-based companies to compete with foreign-based companies in domestic and export markets.
Prisoners.
Under the rulemaking authority vested in the Attorney General in 5 U.S.C. 301; 28 U.S.C. 509, 510 and delegated to the Director, Bureau of Prisons in 28 CFR 0.96, we propose to amend 28 CFR part 550 as follows:
5 U.S.C. 301; 18 U.S.C. 3521-3528, 3621, 3622, 3624, 4001, 4042, 4046, 4081, 4082 (Repealed in part as to offenses committed on or after November 1, 1987), 5006-5024 (Repealed October 12, 1984 as to offenses committed after that date), 5039; 21 U.S.C. 848; 28 U.S.C. 509, 510; Title V, Pub. L. 91-452, 84 Stat. 933 (18 U.S.C. Chapter 223).
The purpose of this subpart is to describe the Bureau's drug abuse treatment programs for the inmate population, to include drug abuse education, non-residential drug abuse treatment services, and residential drug abuse treatment programs (RDAP). These services are provided by Psychology Services department.
(a) * * *
(1)
(3)
(f)
(g)
(2) Ordinarily, inmates must be given at least one formal warning before removal from RDAP. A formal warning is not necessary when the documented lack of compliance with program standards is of such magnitude that an inmate's continued presence would create an immediate and ongoing problem for staff and other inmates.
(3) We may return an inmate who withdraws or is removed from RDAP to his/her prior institution (if we had transferred the inmate specifically to participate in RDAP).
(b) * * *
(4) Inmates who have a prior felony or misdemeanor conviction within the ten years prior to the date of sentencing for their current commitment for:
(i) Homicide (including deaths caused by recklessness, but not including deaths caused by negligence or justifiable homicide);
(ii) Forcible rape;
(iii) Robbery;
(iv) Aggravated assault;
(v) Arson;
(vi) Kidnaping; or
(vii) An offense that by its nature or conduct involves sexual abuse offenses committed upon minors;
(6) Inmates who have been convicted of an attempt, conspiracy, or solicitation to commit an underlying offense listed in paragraph (b)(4) and/or (b)(5) of this section; or
(a) For inmates to successfully complete all components of RDAP, they must participate in CTS. If inmates refuse or fail to complete CTS, they fail RDAP and are disqualified for any additional incentives.
(b) Inmates with a documented drug use problem who did not choose to participate in RDAP may be required to participate in CTS as a condition of participation in a community-based program, with the approval of the Supervisory Community Treatment Services Coordinator.
Postal Regulatory Commission.
Notice of proposed rulemaking.
The Commission is noticing a recent Postal Service filing requesting that the Commission initiate an informal rulemaking proceeding to consider changes to analytical principles relating to periodic reports (Proposal Three). This notice informs the public of the filing, invites public comment, and takes other administrative steps.
Submit comments electronically via the Commission's Filing Online system at
David A. Trissell, General Counsel, at 202-789-6820.
On July 14, 2015, the Postal Service filed a petition pursuant to 39 CFR 3050.11 requesting that the Commission initiate an informal rulemaking proceeding to consider a proposed change in analytical principles relating to periodic reports.
The Postal Service explains that ODIS-RPW is a probability-based destinating mail sampling system that primarily supplies the official “Revenue, Pieces and Weight By Class and Special Services” (RPW) report estimates of revenue, volume, and weight for single-piece stamped and metered mail.
Under Proposal Three, a portion of MEPs would begin digitally capturing the images of letter and card shaped mail from Delivery Barcode Sequencing (DBCS) second pass operations.
The Postal Service plans to implement the change in Proposal Three beginning on January 1, 2016.
The Postal Service states that the change in Proposal Three would have very little impact on the business needs that the ODIS-RPW system supports.
The Commission establishes Docket No. RM2015-11 for consideration of matters raised by the Petition. Additional information concerning the Petition may be accessed via the Commission's Web site at
1. The Commission establishes Docket No. RM2015-11 for consideration of the matters raised by the Petition of the United States Postal Service Requesting Initiation of a Proceeding to Consider a Proposed Change in Analytical Principles (Proposal Three), filed July 14, 2015.
2. Comments are due no later than August 31, 2015. Reply comments are due no later than September 10, 2015.
3. Pursuant to 39 U.S.C. 505, the Commission appoints Katalin K. Clendenin to serve as Public Representative in this docket.
4. The Secretary shall arrange for publication of this order in the
By the Commission.
Environmental Protection Agency (EPA).
Proposed rule.
The Environmental Protection Agency (EPA) is proposing to approve the State Implementation Plan (SIP) revision submitted by the state of Missouri. This revision includes regulatory amendments that remove the requirements of stage II vapor recovery control systems at gasoline dispensing facilities in the St. Louis area, revises certification and testing procedures for stage I vapor recovery systems, prohibits above ground storage tanks at gasoline dispensing facilities, and includes general revisions to better clarify the rule. These revisions to Missouri's SIP do not have an adverse effect on air quality as demonstrated in Missouri's technical demonstration document and EPA's technical support demonstration which is a part of this docket.
Comments must be received on or before August 21, 2015.
Submit your comments, identified by Docket ID No. EPA-R07-OAR-2015-0268, by one of the following methods:
1.
2.
3.
Steven Brown Environmental Protection Agency, Air Planning and Development Branch, 11201 Renner Boulevard, Lenexa, Kansas 66219 at (913) 551-7718, or by email at
Throughout this document “we,” “us,” or “our” refer to EPA. This section provides additional information by addressing the following:
EPA proposes to approve the SIP revision submitted by the state of Missouri that removes the requirements of stage II vapor recovery control systems at gasoline dispensing facilities in the St. Louis area including minor revisions to the rule as described below.
On November 20, 2014, MDNR submitted a request to revise the SIP to include the following revision to Missouri Rule 10 CSR 10-5.220, “Control of Petroleum Liquid Storage, Loading and Transfer”: (1) Removes the requirements of stage II vapor recovery control systems at gasoline dispensing facilities in the St. Louis area, (2) revises certification and testing procedures for the remaining stage I systems consistent with California Air Resources Board (CARB) vapor recovery requirements instead of the Missouri Performance Evaluation and Test Procedures (MOPETP), (3) the prohibition of above ground storage tanks at gasoline dispensing facilities, and (4) general text revisions to better clarify the rule.
The state submission has met the public notice requirements for SIP submissions in accordance with 40 CFR 51.102. The submission also satisfied the completeness criteria of 40 CFR part 51, appendix V. In addition, as explained in this proposed action, the revisions meet the substantive SIP requirements of the CAA, including section 110(l) and section 193 and implementing regulations. EPA has determined that the revisions meet all applicable CAA regulations, policy and guidance as detailed in EPA Technical Support Document and Missouri's technical support documentation which is part of this docket.
We are processing this as a proposed action because we are soliciting comments on this proposed action. Final rulemaking will occur after consideration of any comments.
In this rule, EPA is proposing to include in a final EPA rule regulatory text that includes incorporation by reference. In accordance with requirements of 1 CFR 51.5, EPA is proposing to incorporate by reference the Missouri Regulation “Control of Petroleum Liquid Storage, Loading and Transfer” described in the proposed amendments to 40 CFR part 52 set forth below. EPA has made, and will continue to make, these documents generally available electronically through
Under the CAA, the Administrator is required to approve a SIP submission that complies with the provisions of the Act and applicable Federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in reviewing SIP submissions, EPA's role is to approve state choices, provided that they meet the criteria of the CAA. Accordingly, this proposed action merely approves state law as meeting Federal requirements and does not impose additional requirements beyond those imposed by state law. For that reason, this proposed action:
• Is not a “significant regulatory action” under the terms of Executive Order 12866 (58 FR 51735, October 4, 1993) and is therefore not subject to review under Executive Orders 12866 and 13563 (76 FR 3821, January 21, 2011);
• does not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501
• is certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601
• does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4);
• does not have Federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999);
• is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997);
• is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);
• is not subject to requirements of Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) because application of those requirements would be inconsistent with the CAA; and
• does not provide EPA with the discretionary authority to address, as appropriate, disproportionate human
The SIP is not approved to apply on any Indian reservation land or in any other area where EPA or an Indian tribe has demonstrated that a tribe has jurisdiction. In those areas of Indian country, the rule does not have tribal implications and will not impose substantial direct costs on tribal governments or preempt tribal law as specified by Executive Order 13175 (65 FR 67249, November 9, 2000).
Environmental protection, Air pollution control, Carbon monoxide, Incorporation by reference, Intergovernmental relations, Lead, Nitrogen dioxide, Ozone, Particulate matter, Reporting and recordkeeping requirements, Sulfur oxides, Volatile organic compounds.
For the reasons stated in the preamble, EPA proposes to amend 40 CFR part 52 as set forth below:
42 U.S.C. 7401
(c) * * *
Environmental Protection Agency (EPA).
Proposed rule.
EPA is proposing, in follow-up to canceled product registrations or uses, to revoke certain tolerances for acephate, aldicarb, azinphos-methyl, etridiazole, fenarimol, imazamethabenz-methyl, tepraloxydim, thiacloprid, thiazopyr, and tralkoxydim, and tolerance exemptions for certain pesticide active ingredients. Also, EPA is proposing to make minor revisions to the section heading and introductory text for
Comments must be received on or before September 21, 2015.
Submit your comments, identified by docket identification (ID) number EPA-HQ-OPP-2015-0212, by one of the following methods:
•
•
•
Additional instructions on commenting or visiting the docket, along with more information about dockets generally, is available at
Joseph Nevola, Pesticide Re-Evaluation Division (7508P), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave. NW., Washington, DC 20460-0001; telephone number: (703) 308-8037; email address:
You may be potentially affected by this action if you are an agricultural producer, food manufacturer, or pesticide manufacturer. The following list of North American Industrial Classification System (NAICS) codes is not intended to be exhaustive, but rather provides a guide to help readers determine whether this document applies to them. Potentially affected entities may include:
• Crop production (NAICS code 111).
• Animal production (NAICS code 112).
• Food manufacturing (NAICS code 311).
• Pesticide manufacturing (NAICS code 32532).
1.
2.
This proposed rule provides a comment period of 60 days for any person to state an interest in retaining a tolerance proposed for revocation. If EPA receives a comment within the 60-day period to that effect, EPA will not proceed to revoke the tolerance immediately. However, EPA will take steps to ensure the submission of any needed supporting data and will issue an order in the
EPA issues a final rule after considering comments that are submitted in response to this proposed rule. In addition to submitting comments in response to this proposal, you may also submit an objection at the time of the final rule. If you fail to file an objection to the final rule within the time period specified, you will have waived the right to raise any issues resolved in the final rule. After the specified time, issues resolved in the final rule cannot be raised again in any subsequent proceedings.
EPA is proposing, in follow-up to canceled product registrations or uses, to revoke certain tolerances for the fungicides etridiazole and fenarimol; the herbicides imazamethabenz-methyl, tepraloxydim, thiazopyr, and tralkoxydim; the insecticides acephate, aldicarb, azinphos-methyl, and thiacloprid, in or on commodities listed in the regulatory text; and revoke certain tolerance exemptions for various microbial or biochemical pesticides. Also, EPA is proposing to make minor revisions to the section heading and introductory text for
In addition, EPA is proposing to revoke certain specific tolerances because either they are no longer needed or are associated with food uses that are no longer registered under FIFRA. Those instances where registrations were canceled were because the registrant failed to pay the required maintenance fee and/or the registrant voluntarily requested cancellation of one or more registered uses of the pesticide. It is EPA's general practice to propose revocation of those tolerances for residues of pesticide active ingredients on crop uses for which there are no active registrations under FIFRA, unless any person in comments on the proposal indicates a need for the tolerance to cover residues in or on imported commodities or legally treated domestic commodities.
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9. Delta endotoxin of
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Also, EPA is proposing to re-instate a footnote for the import tolerance on banana in 40 CFR 180.421(a), which was inadvertently removed on September 15, 2006 (71 FR 54423) (FRL-8077-9), as shown in the regulatory text at the end of this document.
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Also, in accordance with current Agency practice, EPA is proposing to revise 40 CFR 180.437 by adding separate paragraphs (b), (c), and (d), and reserving those sections for tolerances with section 18 emergency exemptions, regional registrations, and indirect or inadvertent residues, respectively.
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Also, EPA is proposing to revoke the tolerances in 40 CFR 180.573(a)(2) on cattle, fat; cattle, kidney; cattle, meat; cattle, meat byproducts, except kidney; egg; goat, fat; goat, kidney; goat, meat; goat, meat byproducts, except kidney; hog, fat; hog, kidney; hog, meat; hog, meat byproducts, except kidney; horse, fat; horse, kidney; horse, meat; horse, meat byproducts, except kidney; milk; poultry, fat; poultry, liver; poultry, meat; poultry, meat byproducts, except liver; sheep, fat; sheep, kidney; sheep, meat; and sheep, meat byproducts, except kidney; each with an expiration/revocation date of December 31, 2018.
In addition, EPA is proposing to revoke the tolerance in 40 CFR 180.573(c) on canola, seed with an expiration/revocation date of December 31, 2018.
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A “tolerance” represents the maximum level for residues of pesticide chemicals legally allowed in or on raw agricultural commodities and processed foods. Section 408 of FFDCA, 21 U.S.C. 346a, authorizes the establishment of tolerances, exemptions from tolerance requirements, modifications in tolerances, and revocation of tolerances for residues of pesticide chemicals in or on raw agricultural commodities and processed foods. Without a tolerance or exemption, food containing pesticide residues is considered to be unsafe and therefore “adulterated” under FFDCA section 402(a), 21 U.S.C. 342(a). Such food may not be distributed in interstate commerce, 21 U.S.C. 331(a). For a food-use pesticide to be sold and distributed, the pesticide must not only have appropriate tolerances under the FFDCA, but also must be registered under the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA), 7 U.S.C. 136
EPA's general practice is to propose revocation of tolerances for residues of pesticide active ingredients on crops for which FIFRA registrations no longer exist and on which the pesticide may therefore no longer be used in the United States. EPA has historically been concerned that retention of tolerances that are not necessary to cover residues in or on legally treated foods may encourage misuse of pesticides within the United States. Nonetheless, EPA will establish and maintain tolerances even when corresponding domestic uses are canceled if the tolerances, which EPA refers to as “import tolerances,” are necessary to allow importation into the United States of food containing such pesticide residues. However, where there are no imported commodities that require these import tolerances, the Agency believes it is appropriate to revoke tolerances for unregistered pesticides in order to prevent potential misuse.
Furthermore, as a general matter, the Agency believes that retention of import tolerances not needed to cover any imported food may result in unnecessary restriction on trade of pesticides and foods. Under FFDCA section 408, a tolerance may only be established or maintained if EPA determines that the tolerance is safe based on a number of factors, including an assessment of the aggregate exposure to the pesticide and an assessment of the cumulative effects of such pesticide and other substances that have a common mechanism of toxicity. In doing so, EPA must consider potential contributions to such exposure from all tolerances. If the cumulative risk is such that the tolerances in aggregate are not safe, then every one of these tolerances is potentially vulnerable to revocation. Furthermore, if unneeded tolerances are included in the aggregate and cumulative risk assessments, the estimated exposure to the pesticide would be inflated. Consequently, it may be more difficult for others to obtain needed tolerances or to register needed new uses. To avoid potential trade restrictions, the Agency is proposing to revoke tolerances for residues on crops uses for which FIFRA registrations no longer exist, unless someone expresses a need for such tolerances. Through this proposed rule, the Agency is inviting individuals who need these import tolerances to identify themselves and the tolerances that are needed to cover imported commodities.
Parties interested in retention of the tolerances should be aware that additional data may be needed to support retention. These parties should be aware that, under FFDCA section 408(f), if the Agency determines that additional information is reasonably required to support the continuation of a tolerance, EPA may require that parties interested in maintaining the tolerances provide the necessary information. If the requisite information is not submitted, EPA may issue an order revoking the tolerance at issue.
EPA is proposing that the actions herein become effective 6 months after the date of publication of the final rule in the
Any commodities listed in this proposal treated with the pesticides subject to this proposal, and in the channels of trade following the tolerance revocations, shall be subject to FFDCA section 408(1)(5), as established by FQPA. Under this unit, any residues of these pesticides in or on such food shall not render the food adulterated so long as it is shown to the satisfaction of the Food and Drug Administration that:
1. The residue is present as the result of an application or use of the pesticide at a time and in a manner that was lawful under FIFRA, and
2. The residue does not exceed the level that was authorized at the time of the application or use to be present on the food under a tolerance or exemption from tolerance. Evidence to show that food was lawfully treated may include records that verify the dates when the pesticide was applied to such food.
In making its tolerance decisions, EPA seeks to harmonize U.S. tolerances with international standards whenever
The Codex has not established a MRL for etridiazole, imazamethabenz-methyl, tepraloxydim, thiazopyr, and tralkoxydim.
The Codex has established MRLs for acephate, in or on various commodities, including beans, except broad bean and soya bean at 5 milligrams/kilogram (mg/kg). The beans, except broad bean and soya bean MRL is different than the tolerance established for alidicarb on succulent bean in the United States because of a difference in use pattern and/or agricultural practice.
The Codex has established MRLs for aldicarb, in or on various commodities, including sorghum at 0.1 mg/kg, which is covered by a current U.S. tolerance at a higher level than the MRL, and sorghum straw and fodder, dry at 0.5 mg/kg, which is the same as the U.S. tolerance. The sorghum MRL is different than the tolerance established for alidicarb in the United States because of a difference in use pattern and/or agricultural practice.
The Codex has established MRLs for azinphos-methyl in or on various commodities, including almond hulls and blueberries at 5 m/kilogram (mg/kg), cherries, peach, and plums (including prunes) at 2 mg/kg, and walnuts at 0.3 mg/kg. These MRLs are the same as the tolerances established for azinphos-methyl in the United States.
The Codex has established MRLs for azinphos-methyl, in or on various commodities, including almonds and apple at 0.05 mg/kg (which are covered by current U.S. tolerances at a higher level than the MRLs), and pear at 2 mg/kg. These MRLs are different than the tolerances established for azinphos-methyl in the United States because of differences in use patterns and/or agricultural practices.
The Codex has established MRLs for fenarimol in or on various commodities, including cattle, liver at 0.05 mg/kg, cherries at 1 mg/kg, hops, dry at 5 mg/kg, and pecan at 0.02 mg/kg. These MRLs are the same as the tolerances established for fenarimol in the United States.
The Codex has established MRLs for fenarimol, in or on various commodities, including cattle kidney and cattle meat at 0.02 mg/kg; and grapes at 0.3 mg/kg. These MRLs are different than the tolerances established for fenarimol in the United States because of differences in use patterns and/or agricultural practices.
The Codex has established MRLs for thiacloprid in or on various commodities, including cotton seed at 0.02 mg/kg, peppers, sweet at 1 mg/kg, and stone fruits at 0.5 mg/kg (for U.S. tolerances on cherry subgroup and peach subgroup). These MRLs are the same as the tolerances established for thiacloprid in the United States.
The Codex has established MRLs for thiacloprid, in or on various commodities, including milks at 0.05 mg/kg; pome fruits at 0.7 mg/kg, and stone fruits at 0.5 mg/kg (for U.S. tolerance on plum subgroup). These MRLs are different than the tolerances established for thiacloprid in the United States because of differences in use patterns and/or agricultural practices.
In this proposed rule, EPA is proposing to revoke specific tolerances established under FFDCA section 408. The Office of Management and Budget (OMB) has exempted this type of action (
Environmental protection, Administrative practice and procedure, Agricultural commodities, Pesticides and pests, Reporting and recordkeeping requirements.
Therefore, it is proposed that 40 CFR chapter I be amended as follows:
21 U.S.C. 321(q), 346a and 371.
(a) * * *
(a) * * *
(a)
(b)
(c)
(d)
(a) * * * (1) * * *
(2) * * *
(c) * * *
(a) * * *
Kaolin is exempted from the requirement of a tolerance for residues when used on or in food commodities to aid in the control of insects, fungi, and bacteria (food/feed use).
An exemption from the requirement of a tolerance is established on all food/feed commodities for residues of
Environmental Protection Agency (EPA).
Proposed rule.
EPA is proposing to amend the list of chemical substances that are partially exempt from reporting additional information under the Chemical Data Reporting (CDR) rule. EPA has determined that, based on the totality of information available on the chemical substances listed in this proposed rule, there is a low current interest in their CDR processing and use information. EPA reached this conclusion after considering a number of factors, including the risk of adverse human health or environmental effects, information needs for CDR processing and use information, and the availability of other sources of comparable processing and use information.
Comments must be received on or before September 21, 2015.
Submit your comments, identified by docket identification (ID) number EPA-HQ-OPPT-2014-0809, by one of the following methods:
•
•
•
Additional instructions on commenting or visiting the docket, along with more information about dockets generally, is available at
This partial exemption would eliminate an existing reporting requirement under 40 CFR 711.6(b)(2). EPA is proposing to add the following chemical substances to the list of chemical substances that are exempt from reporting the information described in 40 CFR 711.15(b)(4): Fatty acids, C14-18 and C16-18 unsaturated, methyl esters (Chemical Abstract Services Registry Number (CASRN) 67762-26-9); Fatty acids, C16-18 and C-18 unsaturated, methyl esters (CASRN 67762-38-3); fatty acids, canola oil, methyl esters (CASRN 129828-16-6); Fatty acids, corn oil, methyl esters (CASRN 515152-40-6); Fatty acids, tallow, methyl esters (CASRN 61788-61-2); and Soybean oil, methyl esters (CASRN 67784-80-9). However, by existing terms at 40 CFR 711.6, this partial exemption will become inapplicable to a subject chemical substance in the event that the chemical substance later becomes the subject of a rule proposed or promulgated under section 4, 5(a)(2), 5(b)(4), or 6 of the Toxic Substances Control Act (TSCA); an enforceable consent agreement (ECA) developed under the procedures of 40 CFR part 790; an order issued under TSCA section 5(e) or 5(f); or relief that has been granted under a civil action under TSCA section 5 or 7.
This proposed rule is in response to a petition EPA received for these chemical substances (Refs. 2 and 3) submitted under 40 CFR 711.6(b)(2)(iii)(A). EPA reviewed the information put forward in the petition and additional information against the considerations listed at 40 CFR 711.6(b)(2)(ii). EPA's chemical substance-specific analysis is detailed in supplementary documents available in the docket under docket ID number EPA-HQ-OPPT-2014-0809 (Refs. 4, 5, 6, 7, 8, and 9). The Agency is proposing to add these chemical substances to the partially exempt chemical substances list because it has concluded that, based on the totality of information available, the CDR processing and use information for these chemical substances is of low current interest.
In the January 27, 2015
This action is proposed under the authority of the Toxic Substances Control Act (TSCA), 15 U.S.C. 2600
There are no costs associated with this action and the benefits provided would be related to avoiding potential costs. This partial exemption would eliminate an existing reporting requirement without imposing any new requirements. See also the discussion in Unit V of the January 27, 2015
You may be potentially affected by this action if you manufacture (defined by statute at 15 U.S.C. 2602(7) to include import) the chemical substances contained in this rule. The North American Industrial Classification System (NAICS) codes provided here are not intended to be exhaustive, but rather provide a guide to help readers determine whether this document
Do not submit CBI information to EPA through regulations.gov or email. Clearly mark the part or all of the information that you claim to be CBI. For CBI information in a disk or CD-ROM that you mail to EPA, mark the outside of the disk or CD-ROM as CBI and then identify electronically within the disk or CD-ROM the specific information that is claimed as CBI. In addition to one complete version of the comment that includes information claimed as CBI, a copy of the comment that does not contain the information claimed as CBI must be submitted for inclusion in the public docket. Information so marked will not be disclosed except in accordance with procedures set forth in 40 CFR part 2.
EPA published a direct final rule in the
The following is a listing of the documents that have been placed in the docket for this proposed rule. The docket contains information considered by EPA in developing this proposed rule, including the documents listed in this unit, which are physically located in the docket. In addition, interested parties should consult documents that are referenced in the documents that EPA has placed in the docket, regardless of whether the referenced document is physically located in the docket. For assistance in locating documents that are referenced in documents that EPA has placed in the docket, but that are not physically located in the docket, please consult the technical person listed under
This action is not a significant regulatory action as defined by Executive Order 12866 (58 FR 51735, October 4, 1993). Accordingly, this action was not submitted to the Office of Management and Budget (OMB) for review under Executive Orders 12866 and 13563 (76 FR 3821, January 21, 2011).
According to the PRA, 44 U.S.C. 3501
The information collection requirements related to CDR have already been approved by OMB pursuant to the PRA under OMB control number 2070-0162 (EPA ICR No. 1884.06). Since this action will create a partial exemption from that reporting, without creating any new reporting or recordkeeping requirements, this action will not impose any new burdens that require additional OMB approval.
I certify that this action will not have a significant economic impact on a substantial number of small entities under the RFA, 5 U.S.C. § 601
As indicated previously, EPA is proposing to eliminate an existing reporting requirement for the chemical identified in this document. In granting a partial exemption from existing reporting, this rule will not have a significant economic impact on any affected entities, regardless of their size.
This action does not contain any unfunded mandate as described in UMRA, 2 U.S.C. 1531-1538, and does not significantly or uniquely affect small governments. In granting a partial exemption from existing reporting, this action will impose no new enforceable duty on any State, local or tribal governments, or on the private sector. In addition, based on EPA's experience with chemical data reporting under TSCA, State, local, and Tribal governments are not engaged in the activities that would require them to report chemical data under 40 CFR part 711.
This action will not have a substantial direct effect on 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, as specified in Executive Order 13132 (64 FR 43255, August 10, 1999).
This action will not have Tribal implications because it is not expected to have substantial direct effects on Indian Tribes. This action will not significantly or uniquely affect the communities of Indian Tribal governments, nor involve or impose any requirements that affect Indian Tribes. Accordingly, the requirements of Executive Order 13175 (65 FR 67249, November 9, 2000) do not apply to this rule.
This action is not subject to Executive Order 13045 (62 FR 19885, April 23, 1997), because this action does not address environmental health or safety risks disproportionately affecting children.
This action is not subject to Executive Order 13211 (66 FR 28355, May 22, 2001), because this action is not expected to affect energy supply, distribution, or use.
Since this action does not involve any technical standards, NTTAA section 12(d), 15 U.S.C. 272 note, does not apply to this action.
EPA has determined that this action will not have disproportionately high and adverse human health or environmental effects on minority or low-income populations because it does not affect the level of protection provided to human health or the environment. As such, this action does not entail special considerations of environmental justice related issues as delineated by Executive Order 12898 (59 FR 7629, February 16, 1994).
Environmental protection, Chemicals, Hazardous substances, Reporting and recordkeeping requirements.
Therefore, it is proposed that 40 CFR chapter I be amended as follows:
15 U.S.C. 2607(a).
(b) * * *
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Forest Service, USDA.
Notice of meeting.
The Delta-Bienville Resource Advisory Committee (RAC) will meet in Forest, Mississippi. The committee is authorized under the Secure Rural Schools and Community Self-Determination Act (the Act) and operates in compliance with the Federal Advisory Committee Act. The purpose of the committee is to improve collaborative relationships and to provide advice and recommendations to the Forest Service concerning projects and funding consistent with Title II of the Act. Additional RAC information, including the meeting agenda and the meeting summary/minutes can be found at the following Web site:
The meeting will be held at 6:00 p.m. on August 17, 2015.
All RAC meetings are subject to cancellation. For status of meeting prior to attendance, please contact the person listed under
The meeting will be held at Bienville Ranger District, 3473 Hwy 35 South, Forest, Mississippi. Interested parties may also attend via teleconference by contacting the person listed under
Written comments may be submitted as described under
Michael Esters, Designated Federal Officer, by phone at 601-469-3811 or via email at
Individuals who use telecommunication devices for the deaf (TDD) may call the Federal Information Relay Service (FIRS) at 1-800-877-8339 between 8:00 a.m. and 8:00 p.m., Eastern Standard Time, Monday through Friday.
The purpose of the meeting is:
1. Review projects submitted; and
2. Recommend projects for approval.
The meeting is open to the public. The agenda will include time for people to make oral statements of three minutes or less. Individuals wishing to make an oral statement should request in writing by August 10, 2015, to be scheduled on the agenda. Anyone who would like to bring related matters to the attention of the committee may file written statements with the committee staff before or after the meeting. Written comments and requests for time to make oral comments must be sent to Michael T. Esters, Designated Federal Officer, Bienville Ranger District, 3473 Hwy 35 South, Forest, Mississippi 39074; by email to
Enforcement and Compliance, International Trade Administration, Department of Commerce.
Effective date: July 22, 2015.
Stephanie Moore, AD/CVD Operations, Office III, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Ave. NW., Washington, DC 20230, telephone: (202) 482-3692.
Section 702 of the Trade Agreements Act of 1979 (as amended) (the Act) requires the Department of Commerce (the Department) to determine, in consultation with the Secretary of Agriculture, whether any foreign government is providing a subsidy with respect to any article of cheese subject to an in-quota rate of duty, as defined in section 702(h) of the Act, and to publish quarterly updates to the type and amount of those subsidies. We hereby provide the Department's quarterly update of subsidies on articles of cheese that were imported during the periods January 1, 2015, through March 31, 2015.
The Department has developed, in consultation with the Secretary of Agriculture, information on subsidies, as defined in section 702(h) of the Act, being provided either directly or indirectly by foreign governments on articles of cheese subject to an in-quota rate of duty. The appendix to this notice lists the country, the subsidy program or programs, and the gross and net amounts of each subsidy for which information is currently available. The Department will incorporate additional programs which are found to constitute subsidies, and additional information on the subsidy programs listed, as the information is developed.
The Department encourages any person having information on foreign government subsidy programs which benefit articles of cheese subject to an in-quota rate of duty to submit such information in writing to the Assistant Secretary for Enforcement and
This determination and notice are in accordance with section 702(a) of the Act.
Enforcement and Compliance, International Trade Administration, Department of Commerce.
Stephen Bailey or Dennis McClure at (202) 482-0193 and (202) 482-5973, respectively; AD/CVD Operations, Enforcement and Compliance, U.S. Department of Commerce, 14th Street and Constitution Avenue NW., Washington, DC 20230.
On June 25, 2015, the Department of Commerce (the Department) received an antidumping duty (AD) petition concerning imports of certain hydrofluorocarbon blends and certain single hydrofluorocarbon components thereof (HFCs) from the People's Republic of China (PRC), filed in proper form on behalf of the American HFC Coalition and its individual members,
On June 30, 2015, the Department requested additional information and clarification of certain areas of the Petition.
In accordance with section 732(b) of the Tariff Act of 1930, as amended (the Act), the petitioners allege that imports of HFCs from the PRC are being, or are likely to be, sold in the United States at less than fair value within the meaning of section 731 of the Act, and that such imports are materially injuring, or threatening material injury to, an industry in the United States. Also, consistent with section 732(b)(1) of the Act and 19 CFR 351.202(b), the Petition is accompanied by information reasonably available to the petitioners supporting their allegations.
The Department finds that the petitioners filed the Petition on behalf of the domestic industry because the petitioners are interested parties as defined in sections 771(9)(C), (D), and (F) of the Act. The Department also finds that the petitioners demonstrated sufficient industry support with respect to the initiation of this AD investigation.
Because the Petition was filed on June 25, 2015, pursuant to 19 CFR 351.204(b)(1), the period of investigation (POI) is October 1, 2014, through March 31, 2015.
The products covered by this investigation are blended HFCs and certain single HFC components of those blends thereof, from the PRC. For a full description of the scope of this investigation, see the “Scope of the Investigation,” in Appendix I of this notice.
During our review of the Petition, the Department issued questions to, and received responses from, the petitioners pertaining to the proposed scope to ensure that the scope language in the Petition would be an accurate reflection of the products for which the domestic
This investigation includes any Chinese HFC components that are blended in a third country to produce a subject HFC blend before being imported into the United States. Also included are semi-finished blends of Chinese HFC components. Semi-finished blends are blends of one or more of the single-component Chinese HFCs used to produce the subject HFC blends, whether or not blended in China or a third country, that have not been blended to the specific proportions required to meet the definition of one of the subject HFC blends described above (R-404A, R-407A, R-407C, R-410A, and R-507A). Single-component HFCs and semi-finished HFC blends are not excluded from the scope of this investigation when blended with HFCs from non-subject countries.
The Department has not adopted this provision for the purposes of initiation because the additional language has presented the Department with some novel and complex issues with respect to administering any potential AD order and, as such, we believe this warrants further discussion and analysis from parties to this proceeding.
The Department requests that any factual information the parties consider relevant to the scope of the investigation be submitted during this time period. However, if a party subsequently finds that additional factual information pertaining to the scope of the investigation may be relevant, the party may contact the Department and request permission to submit the additional information.
All submissions to the Department must be filed electronically using Enforcement and Compliance's Antidumping and Countervailing Duty Centralized Electronic Service System (ACCESS).
The Department requests comments from interested parties regarding the appropriate physical characteristics of HFCs to be reported in response to the Department's AD questionnaire. This information will be used to identify the key physical characteristics of the subject merchandise in order to report the relevant factors of production (FOPs).
Interested parties may provide any information or comments that they feel are relevant to the development of an accurate list of physical characteristics. Specifically, they may provide comments as to which characteristics are appropriate to use as: (1) General product characteristics and (2) product-comparison criteria. We note that it is not always appropriate to use all product characteristics as product-comparison criteria. We base product-comparison criteria on meaningful commercial differences among products. In other words, although there may be some physical product characteristics utilized by manufacturers to describe HFCs, it may be that only a select few product characteristics take into account commercially meaningful physical characteristics. In addition, interested parties may comment on the order in which the physical characteristics should be used in matching products. Generally, the Department attempts to list the most important physical characteristics first and the least important characteristics last.
In order to consider the suggestions of interested parties in developing and issuing the AD questionnaire, all comments must be filed by 5:00 p.m. ET on Tuesday, August 4, 2015, which is 20 calendar days from the signature date of this notice. Any rebuttal comments must be filed by 5:00 p.m. ET on Friday, August 14, 2015. All comments and submissions to the Department must be filed electronically using ACCESS, as explained above.
Section 732(b)(1) of the Act requires that a petition be filed on behalf of the domestic industry. Section 732(c)(4)(A) of the Act provides that a petition meets this requirement if the domestic producers or workers who support the petition account for: (i) At least 25 percent of the total production of the domestic like product; and (ii) more than 50 percent of the production of the domestic like product produced by that portion of the industry expressing support for, or opposition to, the petition. Moreover, section 732(c)(4)(D) of the Act provides that, if the petition does not establish support of domestic producers or workers accounting for more than 50 percent of the total production of the domestic like product, the Department shall: (i) Poll the industry or rely on other information in order to determine if there is support for the petition, as required by subparagraph (A); or (ii) determine industry support using a statistically valid sampling method to poll the “industry.”
Section 771(4)(A) of the Act defines the “industry” as the producers as a whole of a domestic like product. Thus, to determine whether a petition has the requisite industry support, the statute directs the Department to look to producers and workers who produce the domestic like product. The International Trade Commission (ITC), which is responsible for determining whether “the domestic industry” has been injured, must also determine what constitutes a domestic like product in order to define the industry. While both the Department and the ITC must apply the same statutory definition regarding the domestic like product,
Section 771(10) of the Act defines the domestic like product as “a product which is like, or in the absence of like, most similar in characteristics and uses with, the article subject to an investigation under this title.” Thus, the reference point from which the domestic like product analysis begins is “the article subject to an investigation” (
With regard to the domestic like product, the petitioners do not offer a definition of the domestic like product distinct from the scope of the investigation. Based on our analysis of the information submitted on the record, we have determined that HFCs constitute a single domestic like product and we have analyzed industry support in terms of that domestic like product.
In determining whether the petitioners have standing under section 732(c)(4)(A) of the Act, we considered the industry support data contained in the Petition with reference to the domestic like product as defined in the “Scope of the Investigation,” in Appendix I of this notice. The petitioners provided their production of HFC blends in 2014, and estimated the potential maximum U.S. production of HFC blends for the entire domestic industry using data on merchant market shipments and imports of HFC components.
Our review of the data provided in the Petition, Petition Supplements, and other information readily available to the Department indicates that the petitioners have established industry support.
The Department finds that the petitioners filed the Petition on behalf of the domestic industry because they are interested parties as defined in sections 771(9)(C), (D), and (F) of the Act and they have demonstrated sufficient industry support with respect to the AD investigation that they are requesting the Department initiate.
The petitioners allege that the U.S. industry producing the domestic like product is being materially injured, or is threatened with material injury, by reason of the imports of the subject merchandise sold at less than fair value. In addition, the petitioners allege that subject imports exceed the negligibility threshold provided for under section 771(24)(A) of the Act.
The petitioners contend that the industry's injured condition is illustrated by reduced market share; underselling and price depression or suppression; lost sales and revenues; negative impact on domestic industry capacity, capacity utilization, and employment; and negative impact on domestic industry sales revenues and operating profits.
The following is a description of the allegation of sales at less than fair value upon which the Department based its decision to initiate an investigation of imports of HFCs from the PRC. The sources of data for the deductions and adjustments relating to U.S. price and normal value (NV) are discussed in greater detail in the initiation checklist.
The petitioners based export price (EP) on price lists and PRC export data.
The Department has always treated the PRC as a non-market economy (NME) country. In accordance with section 771(18)(C)(i) of the Act, the presumption of NME status remains in effect until revoked by the Department. The presumption of NME status for the PRC has not been revoked by the Department and, therefore, remains in effect for purposes of the initiation of
The petitioners claim that Thailand is an appropriate surrogate country because it is a market economy that is at a level of economic development comparable to that of the PRC, it is a significant producer of the merchandise under consideration, and the data for valuing FOPs, factory overhead, selling, general and administrative (SG&A) expenses, and profit are both available and reliable.
Based on the information provided by the petitioners, we believe it is appropriate to use Thailand as a surrogate country for initiation purposes. Interested parties will have the opportunity to submit comments regarding surrogate country selection and, pursuant to 19 CFR 351.301(c)(3)(i), will be provided an opportunity to submit publicly available information to value FOPs within 30 days before the scheduled date of the preliminary determination.
The petitioners based the FOPs for materials, labor, and energy on petitioning U.S. producers' consumption rates for producing HFCs.
The petitioners valued the FOPs for raw materials (
The petitioners valued labor using data published by Thailand's National Statistics Office (NSO).
The petitioners used published rates by the Electricity Generating Authority of Thailand (EGAT) for 2013 to value electricity.
The petitioners calculated surrogate financial ratios (
Based on the data provided by the petitioners, there is reason to believe that imports of HFCs from the PRC are being, or are likely to be, sold in the United States at less than fair value. Based on comparisons of EP to NV, in accordance with section 773(c) of the Act, the estimated dumping margins for HFCs from the PRC range from 111.20 to 300.30 percent.
Based upon the examination of the Petition on HFCs from the PRC, we find that the Petition meets the requirements of section 732 of the Act. Therefore, we are initiating an AD investigation to determine whether imports of HFCs from the PRC are being, or are likely to be, sold in the United States at less than fair value. In accordance with section 733(b)(1)(A) of the Act and 19 CFR 351.205(b)(1), unless postponed, we will make our preliminary determination no later than 140 days after the date of this initiation.
The petitioners named 44 companies as producers/exporters of HFCs.
Exporters/producers of HFCs from the PRC that do not receive Q&V questionnaires by mail may still submit a response to the Q&V questionnaire and can obtain a copy from the Enforcement and Compliance Web site.
In order to obtain separate-rate status in an NME investigation, exporters and producers must submit a separate-rate application.
The Department will calculate combination rates for certain respondents that are eligible for a separate rate in an NME investigation. The Separate Rates and Combination Rates Bulletin states:
{w}hile continuing the practice of assigning separate rates only to exporters, all separate rates that the Department will now assign in its NME Investigation will be specific to those producers that supplied the exporter during the period of investigation. Note, however, that one rate is calculated for the exporter and all of the producers which supplied subject merchandise to it during the period of investigation. This practice applies both to mandatory respondents receiving an individually calculated separate rate as well as the pool of non-investigated firms receiving the weighted-average of the individually calculated rates. This practice is referred to as the application of “combination rates” because such rates apply to specific combinations of exporters and one or more producers. The cash-deposit rate assigned to an exporter will apply only to merchandise both exported by the firm in question
In accordance with section 732(b)(3)(A) of the Act and 19 CFR 351.202(f), copies of the public version of the Petition have been provided to the government of the PRC via ACCESS. To the extent practicable, we will attempt to provide a copy of the public version of the Petition to each exporter named in the Petition, as provided under 19 CFR 351.203(c)(2).
We have notified the ITC of our initiation, as required by section 732(d) of the Act.
The ITC will preliminarily determine, within 45 days after the date on which the Petition was filed, whether there is a reasonable indication that imports of HFCs from the PRC are materially injuring or threatening material injury to a U.S. industry.
Factual information is defined in 19 CFR 351.102(b)(21) as: (i) Evidence submitted in response to questionnaires; (ii) evidence submitted in support of allegations; (iii) publicly available information to value factors under 19 CFR 351.408(c) or to measure the adequacy of remuneration under 19 CFR 351.511(a)(2); (iv) evidence placed on the record by the Department; and (v) evidence other than factual information described in (i)-(iv). The regulation requires any party, when submitting factual information, to specify under which subsection of 19 CFR 351.102(b)(21) the information is being submitted and, if the information is submitted to rebut, clarify, or correct factual information already on the record, to provide an explanation identifying the information already on the record that the factual information seeks to rebut, clarify, or correct. Time limits for the submission of factual information are addressed in 19 CFR 351.301, which provides specific time limits based on the type of factual information being submitted. Please review the regulations prior to submitting factual information in this investigation.
Parties may request an extension of time limits before the expiration of a time limit established under Part 351, or as otherwise specified by the Secretary. In general, an extension request will be considered untimely if it is filed after the expiration of the time limit established under Part 351 expires. For submissions that are due from multiple parties simultaneously, an extension request will be considered untimely if it is filed after 10:00 a.m. on the due date. Under certain circumstances, we may elect to specify a different time limit by which extension requests will be considered untimely for submissions which are due from multiple parties simultaneously. In such a case, we will inform parties in the letter or memorandum setting forth the deadline (including a specified time) by which extension requests must be filed to be considered timely. An extension request must be made in a separate, stand-alone submission; under limited circumstances we will grant untimely-filed requests for the extension of time limits. Review
Any party submitting factual information in an AD proceeding must certify to the accuracy and completeness of that information.
Interested parties must submit applications for disclosure under APO in accordance with 19 CFR 351.305. On January 22, 2008, the Department published
This notice is issued and published pursuant to section 777(i) of the Act.
The products subject to this investigation are blended hydrofluorocarbons (HFCs) and single HFC components of those blends thereof, whether or not imported for blending. HFC blends covered by the scope are R-404, a zeotropic mixture consisting of 52 percent 1,1,1-Trifluoroethane, 44 percent Pentafluoroethane, and 4 percent 1,1,1,2-Tetrafluoroethane; R-407A, a zeotropic mixture of 20 percent Difluoromethane, 40 percent Pentafluoroethane, and 40 percent 1,1,1,2-Tetrafluoroethane; R-407C, a zeotropic mixture of 23 percent Difluoromethane, 25 percent Pentafluoroethane, and 52 percent 1,1,1,2-Tetrafluoroethane; R-410A, a zeotropic mixture of 50 percent Difluoromethane and 50 percent Pentafluoroethane; and R-507A, an azeotropic mixture of 50 percent Pentafluoroethane and 50 percent 1,1,1-Trifluoroethane also known as R-507. The foregoing percentages are nominal percentages by weight. Actual percentages of single component refrigerants by weight may vary by plus or minus two percent points from the nominal percentage identified above.
The single component HFCs covered by the scope are R-32, R-125, and R-143a. R-32 or Difluoromethane has the chemical formula CH
Excluded from this investigation are blends of refrigerant chemicals that include products other than HFCs, such as blends including chlorofluorocarbons (CFCs) or hydrochlorofluorocarbons (HCFCs).
Also excluded from this investigation are patented HFC blends, such as ISCEON® blends, including MO99
HFC blends covered by the scope of this investigation are currently classified in the Harmonized Tariff Schedule of the United States (HTSUS) at subheading 3824.78.0000. Single component HFCs are currently classified at subheading 2903.39.2030, HTSUS. Although the HTSUS subheadings and CAS registry numbers are provided for convenience and customs purposes, the written description of the scope is dispositive.
Enforcement and Compliance, International Trade Administration, Department of Commerce.
The Department of Commerce (the “Department”) is conducting an administrative review of the antidumping duty order on certain polyester staple fiber from the People's Republic of China (“PRC”), for the period of review (“POR”), June 1, 2013, to May 31, 2014.
Javier Barrientos, AD/CVD Operations, Office V, Enforcement and Compliance, International Trade Administration, Department of Commerce, 14th Street and Constitution Avenue NW., Washington, DC 20230; telephone: (202) 482-2243.
The Department preliminarily determines that Zhaoqing Tifo New Fibre Co., Ltd. (“Zhaoqing Tifo”) failed to establish that it is entitled to a separate rate for the POR and, thus, we are treating Zhaoqing Tifo as part of the PRC-wide entity.
The merchandise subject to the order is certain polyester staple fiber. The product is currently classified under the Harmonized Tariff Schedule of the United States (“HTSUS”) numbers 5503.20.0045 and 5503.20.0065. Although the HTSUS numbers are provided for convenience and customs purposes, the written description of the scope of the order remains dispositive.
The Department conducted this review in accordance with section 751(a)(1)(B) of the Act. For a full description of the methodology underlying our conclusions,
The Department initiated a review for two companies.
In addition, the Department preliminarily determines that Takayasu had no shipments during the POR and, therefore, had no reviewable entries.
Interested parties may submit case briefs within 30 days after the date of publication of these preliminary results of review.
Any interested party may request a hearing within 30 days of publication of this notice.
The Department intends to issue the final results of this administrative review, which will include the results of our analysis of all issues raised in the case briefs, within 120 days of publication of these preliminary results in the
Upon issuance of the final results, the Department will determine, and CBP shall assess, antidumping duties on all appropriate entries covered by this review.
For any individually examined respondent whose weighted average dumping margin is above
The Department announced a refinement to its assessment practice in non-market economy (“NME”) cases.
In accordance with section 751(a)(2)(C) of the Act, the final results of this review shall be the basis for the assessment of antidumping duties on entries of merchandise covered by the final results of this review and for future deposits of estimated duties, where applicable.
The following cash deposit requirements will be effective upon publication of the final results of this review for shipments of the subject merchandise from the PRC entered, or withdrawn from warehouse, for consumption on or after the publication date, as provided by sections 751(a)(2)(C) of the Act: (1) For any companies listed that have a separate rate, the cash deposit rate will be that established in the final results of this review (except, if the rate is zero or
This notice also serves as a preliminary reminder to importers of their responsibility under 19 CFR 351.402(f)(2) to file a certificate regarding the reimbursement of antidumping duties prior to liquidation of the relevant entries during the POR. Failure to comply with this requirement could result in the Department's presumption that reimbursement of antidumping duties occurred and the subsequent assessment of double antidumping duties.
These preliminary results are issued and published in accordance with sections 751(a)(1) and 777(i)(1) of the Act and 19 CFR 351.221(b)(4).
National Institute of Standards and Technology (NIST), Commerce.
Notice.
The National Institute of Standards and Technology (NIST), a non-regulatory agency of the United States Department of Commerce, is conducting this prize competition to spur the development of innovative mobile applications that utilize NIST datasets to help better share the data and provide a useful service to those who can best use it. NIST Standard Reference Data (SRD) are well-documented numeric data used in technical problem-solving, research, and development; over 100 types are available for use in scientific and engineering applications, with over 19 million downloads recorded annually (excluding web-based time services). Most of these data sets are currently freely accessible through web-based interfaces or are made available on CD upon request. Mobile applications that can readily access and utilize this data will help drive further innovation and support research through easy and low-barrier access to the results of U.S. tax-payer funded research.
Participants in this prize competition are invited to submit Apps (as defined in this Notice) that use eligible NIST Standard Reference Data (SRD) datasets listed on the Event Web site,
The Submission Period begins July 27, 2015, at 9 a.m. EDT and ends September 28, 2015, at 5 p.m. EDT. Prize competition dates are subject to change at the discretion of NIST. Entries submitted before or after the Submission Period will not be reviewed or considered for award.
Questions about the prize competition can be directed to NIST via the Event Web site, or by email to Heather Evans at
Changes or updates to the prize competition rules will be posted and can be viewed at the Event Web site,
Results of the prize competition will be announced on the Event Web site,
This prize competition (“Competition”) is sponsored by the National Institute of Standards and Technology (NIST;
This Competition is open to all individuals over the age of 18 that are residents of the 50 United States, the District of Columbia, Puerto Rico, the U.S. Virgin Islands, Guam, the Commonwealth of the Northern Mariana Islands, and American Samoa, and to for-profit or non-profit corporations, institutions, or other validly formed legal entities organized or incorporated in,
To be eligible to win a Competition prize, a Participant (whether an individual or legal entity) must have registered to participate, must have complied with all the requirements under section 3719 of title 15, United States Code (“Prize competitions”).
A Participant shall not be deemed ineligible because the Participant used Federal facilities or consulted with
Multiple entries are permitted. Each entry will be reviewed independently. Multiple individuals and/or legal entities may collaborate as a group to submit a single entry, in which case all members of the group must satisfy the eligibility requirements, and a single individual from the group must be designated as an official representative for each entry. That designated individual will be responsible for meeting all entry and evaluation requirements. Participation is subject to all U.S. federal, state and local laws and regulations. Void where prohibited or restricted by law. Participants are responsible for checking applicable laws and regulations in their jurisdiction(s) before participating in this Competition, to ensure that their participation is legal. Individuals entering on behalf of or representing a company, institution or other legal entity are responsible for confirming that their entry does not violate any policies of that company, institution or legal entity.
NIST employees, NIST associates, and any other individuals or legal entities involved with the design, production, execution, distribution or evaluation of the Competition, are not eligible to enter. NIST employees and NIST Guest Researchers are not eligible to enter. Federal entities and non-NIST Federal employees acting in their official capacities are not eligible to enter. Non-NIST Federal employees acting in their personal capacities should consult with their respective agency ethics officials to determine whether their participation in this Competition is permissible.
To enter, create a user account at ChallengePost by visiting challengepost.com and register your interest in participating in the Competition at the Event Web site,
NIST provides free online access to high quality scientific data in a wide range of disciplines. The eligible NIST datasets for this Competition pertain to physics and chemistry and are frequently used by high school, college, and graduate students in advanced chemistry and physics coursework. For example, below are links to four NIST Standard Reference Data that represent some of the eligible NIST datasets for this Competition:
(1) Ground Levels and Ionization Energies for the Neutral Atoms (SRD 111,
(2) Atomic Weights and Isotopic Compositions (SRD 144,
(3) CODATA Fundamental Physical Constants (SRD 121,
(4) the NIST Computational Chemistry Comparison and Benchmark Database (SRD 101,
These four datasets are a subset of the eligible NIST SRD datasets that are listed on the Event Web site,
While not required, other freely available scientific data (from NIST or a third-party) may enhance the usefulness of the App for other users. A submission requires (1) your App software provided to the Competition Sponsor at no cost; (2) a brief (less than 250 words) text description of your App; (3) at least one screenshot image of your App in use on a mobile phone or tablet device; (4) a brief (less than five minutes) video demonstrating the functionality of your App; and (5) confirmation that you have read and agree to the Competition Rules contained in this Notice. Participants may begin submitting Competition Entries at 9:00 a.m. EDT on July 27, 2015, to the Event Web site. Competition Entries must be submitted no later than 5:00 p.m. EDT on September 28, 2015, to the Event Web site.
Entries submitted before the start date and time, or after the end date and time, will not be evaluated or considered for award. Entries sent to NIST in any manner other than through the Event Web site will not be evaluated or considered for award. Entries that do not comply with the formatting requirements set forth in this Notice and the Event Web site will not be evaluated or considered for award. Changes or updates to the prize competition rules will be posted and can be viewed at the Event Web site,
Entries must be complete, non-confidential and in English.
In general, each Entry:
(a) Must affirmatively represent that the Participant (and each Participant if more than one) has read and consents to be governed by the Competition rules and meets the eligibility requirements;
(b) Must include an App (
(c) Must include a brief (less than 250 words) text description of the Participant's App; and
(d) Must include at least one photograph of the App running on a mobile phone or tablet device, and
(e) Must include a weblink (YouTube or Vimeo) to a short (less than five minutes) video that demonstrates the functionality of the application. Participant must have permission to use all content in the video, including footage, music and images.
The Prize Purse is a total of $45,000. The Prize Purse may increase, but will not decrease. Any increases in the Prize Purse will be posted on the Event Web site and published in the
NIST will announce via the Event Web site any Entry(ies) as to which the Judges have made a cash award (each, an “Award”). The anticipated number and amount of the Awards that will be awarded for this Competition is set forth
All Awards are a one-time offer and there is no offer of licensure, royalty, or other financial compensation implied beyond the Awards. Winners are responsible for all taxes and reporting related to any Award received as part of the Competition.
All costs incurred in the preparation of Competition Entries are to be borne by Participants.
This section discusses how Participant submissions will be evaluated.
The requirements for submission of a complete entry are detailed in the above section “Entry Process for Participants” and at the Event Web site. Submissions will be reviewed by Subject Matter Experts (described below), who will determine whether the submission meets the following minimum criteria for consideration for a Prize:
1. General: App submission should include detailed instructions on how to install and operate the App, and system requirements to run the App.
2. NIST Acknowledgment: The following notice should be displayed prominently within the application: “This product uses data provided by the National Institute of Standards and Technology (NIST) but is not endorsed or certified by NIST.” The NIST SRD number must also be displayed prominently in the application. Use of the NIST or Department of Commerce logos is prohibited.
3. Functionality/Accuracy: A Submission may be disqualified if the software application fails to function as expressed in the description submitted by the Participant.
4. Privacy: Participants should keep in mind that NIST considers protection of personal information an essential element of App security. Apps must seek user permission to access and use personal information.
5. Security Vulnerabilities: Participants must agree that NIST may conduct testing on the App to determine whether malware or other security threats may be present. NIST may disqualify the App if, in NIST's sole judgment, the App may damage government or others' equipment or operating environment. For guidance about minimizing security vulnerabilities in mobile applications, Participants can consult NIST Special Publication 800-163, “Vetting the Security of Mobile Applications” (
6. Completeness: Other required components of the submission (as listed in the Entry Process for Participants section above) are complete.
Submissions that meet the minimum criteria specified above will be presented to the Judges for evaluation. Judges are not required to test the App and may choose to judge based solely on the text description, images, and video provided in the Submission. Judges will evaluate submissions using the following Judging Criteria (the weighting percentage for each criterion is given in parentheses):
1. Potential impact: How strong is the potential of the submission to help students and other technical experts use NIST Standard Reference Data? (25%)
2. Creativity and Innovation: To what degree is this submission innovative? Does it bring new thinking and creativity to improving access to NIST Standard Reference Data? (25%)
3. Implementation: Does the App work well? Does it provide an engaging user experience and have interactive capabilities? (25%)
4. Uses scientific reference data: Does the App use at least one of the eligible datasets? Preference will be given to applications that integrate more than one dataset. (25%)
Awards:
First, Second, and Third Place Prizes will be selected by the Judges.
Subject Matter Experts, to be selected by NIST, will, as a body, represent a high degree of technical background in App development, software security, and scientific research data. Subject Matter Experts will consist of NIST employees or NIST associates and will provide initial assessments of App submissions using the criteria described herein to determine whether the submission meets the minimum criteria. Subject Matter Experts will not select winners of any Awards.
A panel of highly qualified Judges appointed by the NIST Director will select winners of Awards to be awarded to First, Second, and Third Place Submissions using the Judging Criteria described herein. The panel of Judges has a collective expertise that creates an overall balanced panel with broad representation of relevant areas to the challenge such as App design, NIST datasets, measurement science, standards, data security, user interfaces, Web sites, and/or mobile devices. Judges include individuals from both inside and outside NIST who are experts in areas relevant to the challenge. The Judges may not have personal or financial interests in, or be an employee, officer, director, or agent of any entity that is a registered Participant in this Competition, and may not have a familial or financial relationship with an individual who is a registered Participant. In the event of such a conflict, a Judge must recuse himself or herself. A Participant(s) should review the list of the Judges available at the Event Web site, and must identify, as part of their Entry submission, any Judge who has personal or financial interests in, or is an employee, officer, director, or agent of any entity that is a Participant in this Competition, or who has a familial or financial relationship with an individual who is a Participant. Thereafter, a Participant(s) must immediately inform the Competition Sponsor through the Event Web site of a change in status resulting in a conflict for any Judge as described above. Failure to do so may disqualify a Participant(s) from receiving an Award.
Other than as set forth herein, NIST does not make any claim to ownership of your Entry or any of your intellectual
By submitting an Entry, you grant to NIST the right to review your Entry as described above in the section “Entry Submission and Review,” to describe your Entry in connection with any materials created in connection with the Competition and to have the Subject Matter Experts, Judges, Competition administrators, and the designees of any of them, review your Entry.
By submitting an Entry, you grant a non-exclusive right and license to NIST to use your name, likeness, biographical information, image, any other personal data submitted with your Entry and the contents in your Entry (including any created works, such as YouTube® videos, but not including any App software submitted with or as part of your Entry), in connection with the Competition. You also agree that this license is perpetual and irrevocable.
You agree that nothing in this Notice grants you a right or license to use any names or logos of NIST or the Department of Commerce, or any other intellectual property or proprietary rights of NIST or the Department of Commerce. You grant to NIST the right to include your company or institution name and logo (if your Entry is from a company or institution) as a Participant on the Event Web site and in materials from NIST announcing winners of or Participants in the Competition. Other than these uses or as otherwise set forth herein, you are not granting NIST any rights to your trademarks.
Entries containing any matter which, in the sole discretion of NIST, is indecent, defamatory, in obvious bad taste, which demonstrates a lack of respect for public morals or conduct, which promotes discrimination in any form, which shows unlawful acts being performed, which is slanderous or libelous, or which adversely affects the reputation of NIST, will not be accepted. If NIST, in its sole discretion, finds any Entry to be unacceptable, then such Entry shall be deemed disqualified and will not be evaluated or considered for award. NIST shall have the right to remove any content from the Event Web site in its sole discretion at any time and for any reason, including, but not limited to, any online comment or posting related to the Competition.
By making a submission to the Competition, you agree that no part of your submission includes any confidential or proprietary information, ideas or products, including but not limited to information, ideas or products within the scope of the Trade Secrets Act, 18 U.S.C. 1905. Since NIST does not wish to receive or hold any submitted materials “in confidence,” it is agreed that, with respect to your Entry, no confidential or fiduciary relationship or obligation of secrecy is established between NIST and you, your Entry team, the company or institution you represent when submitting an Entry, or any other person or entity associated with any part of your Entry.
By submitting an Entry, you represent and warrant that all information you submit is true and complete to the best of your knowledge, that you have the right and authority to submit the Entry on your own behalf or on behalf of the persons and entities that you specify within the Entry, and that your Entry (both the information and software submitted in the Entry and the underlying technologies or concepts described in the Entry):
(a) Is your own original work, or is submitted by permission with full and proper credit given within your Entry;
(b) does not contain confidential information or trade secrets (yours or anyone else's);
(c) does not knowingly, after due inquiry (including, by way of example only and without limitation, reviewing the records of the United States Patent and Trademark Office and inquiring of any employees and other professionals retained with respect to such matters), violate or infringe upon the patent rights, industrial design rights, copyrights, trademarks, rights in technical data, rights of privacy, publicity or other intellectual property or other rights of any person or entity;
(d) does not contain malicious code, such as viruses, malware, timebombs, cancelbots, worms, Trojan horses or other potentially harmful programs or other material or information;
(e) does not and will not violate any applicable law, statute, ordinance, rule or regulation, including, without limitation, United States export laws and regulations, including, but not limited to, the International Traffic in Arms Regulations and the Department of Commerce Export Regulations; and
(f) does not trigger any reporting or royalty or other obligation to any third party.
By participating in the Competition, you agree to assume any and all risks and to release, indemnify and hold harmless NIST, each of the Judges, and Subject Matter Experts, from and against any injuries, losses, damages, claims, actions and any liability of any kind (including attorneys' fees) resulting from or arising out of your participation in, association with or submission to the Competition (including any claims alleging that your Entry infringes, misappropriates or violates any third party's intellectual property rights). In addition, you agree to waive claims against the Federal Government and its related entities, except in the case of willful misconduct, for any injury, death, damage, or loss of property, revenue, or profits, whether direct, indirect, or consequential, arising from your participation in this Competition, whether the injury, death, damage, or loss arises through negligence or otherwise.
NIST is not responsible for any miscommunications such as technical failures related to computer, telephone, cable, and unavailable network or server connections, related technical failures, or other failures related to hardware, software or virus, or incomplete or late Entries. Any compromise to the fair and proper conduct of the Competition may result in the disqualification of an Entry or Participant, termination of the Competition, or other remedial action, at the sole discretion of NIST. NIST reserves the right in its sole discretion to extend or modify the dates of the Competition, and to change the terms set forth herein governing any phases taking place after the effective date of any such change. By entering, you agree to the terms set forth herein and to all decisions of NIST, the Judges, the Subject Matter Experts, and/or all of their respective agents, which are final and binding in all respects.
NIST is not responsible for: (1) Any incorrect or inaccurate information, whether caused by a Participant, printing errors, or by any of the equipment or programming associated with or used in the Competition; (2) unauthorized human intervention in any part of the Entry process for the Competition; (3) technical or human error that may occur in the administration of the Competition or the processing of Entries; or (4) any injury or damage to persons or property that may be caused, directly or indirectly, in whole or in part, from a Participant's participation in the Competition or receipt or use or misuse of an Award. If for any reason an Entry is confirmed
NIST reserves the authority to cancel, suspend, and/or modify the Competition, or any part of it, if any fraud, technical failures, or any other factor beyond NIST's reasonable control impairs the integrity or proper functioning of the Competition, as determined by NIST in its sole discretion.
NIST reserves the right to disqualify any Participant or Participant team it believes to be tampering with the Entry process or the operation of the Competition or to be acting in violation of any applicable rule or condition. Any attempt by any person to undermine the legitimate operation of the Competition may be a violation of criminal or civil law.
All potential winners are subject to verification by NIST, whose decisions are final and binding in all matters related to the Competition.
Potential winner(s) must continue to comply with all terms and conditions of the Competition Rules described in this notice and posted on the Event Web site as Official Rules, and winning is contingent upon fulfilling all requirements. In the event that a potential winner, or an announced winner, is found to be ineligible or is disqualified for any reason, NIST may make award, instead, to another Participant, as may be determined by the Judges.
Personal and contact information is not collected by NIST for commercial or marketing purposes. Except as provided herein, information submitted throughout the Competition will be used only to communicate with Participants regarding Entries and/or the Competition. Participant Entries and submissions to the Competition may be subject to disclosure under the Freedom of Information Act (“FOIA”).
15 U.S.C. 3719.
National Assessment Governing Board, U.S. Department of Education.
Announcement of open and closed meetings.
This notice sets forth the agenda for the August 6-8, 2015 Quarterly Meeting of the National Assessment Governing Board (hereafter referred to as Governing Board). This notice provides information to members of the public who may be interested in attending the meeting or providing written comments on the meeting. The notice of this meeting is required under section 10(a)(2) of the Federal Advisory Committee Act (FACA).
The Quarterly Board meeting will be held on the following dates:
• August 6, 2015 from 8:30 a.m. to 6:15 p.m.
• August 7, 2015 from 8:30 a.m. to 5:30 p.m.
• August 8, 2015 from 7:30 a.m. to 12:00 p.m.
Westin Arlington Gateway, 801 North Glebe Road, Arlington, VA 22203.
Munira Mwalimu, Executive Officer, 800 North Capitol Street NW., Suite 825, Washington, DC 20002, telephone: (202) 357-6938, fax: (202) 357-6945.
The Board is established to formulate policy for the National Assessment of Educational Progress (NAEP). The Board's responsibilities include the following: Selecting subject areas to be assessed, developing assessment frameworks and specifications, developing appropriate student achievement levels for each grade and subject tested, developing standards and procedures for interstate and national comparisons, improving the form and use of NAEP, developing guidelines for reporting and disseminating results, and releasing initial NAEP results to the public.
Assessment Development Committee: Closed Session: 8:30 a.m.-4:00 p.m.
Executive Committee: Open Session: 4:30 p.m.-5:20 p.m.; Closed Session: 5:20 p.m.-6:15 p.m.
Full Board: Open Session: 8:30 a.m.-10:15 a.m.; Closed Session: 12:45 p.m. to 2:45 p.m.; Open Session 2:45 p.m.-5:30 p.m.
Assessment Development Committee (ADC): Open Session: 10:15 a.m.-11:10 a.m.; Closed Session: 11:10 a.m.-12:30 p.m.
Reporting and Dissemination Committee (R&D): Open Session: 10:15 a.m.-12:30 p.m.
Committee on Standards, Design and Methodology (COSDAM): Open Session: 10:15 a.m.-11:45 a.m.; Closed Session: 11:45 a.m.-12:30 p.m.
Nominations Committee: Closed Session: 7:30 a.m.-8:15 a.m.
Full Board: Closed Session: 8:30 a.m.-10:00 a.m. Open Session 10:00 a.m.-12:00 p.m.
On August 6, 2015, from 8:30 a.m. to 4:00 p.m., the Assessment Development Committee will meet in closed session to review assessment items for the NAEP transition to digital-based assessments (DBA). The review will include secure items in mathematics at grades 4 and 8 for the 2016 pilot, in preparation for the 2017 operational assessment. The Committee's reviews and discussions on secure test items cannot be discussed in an open meeting to protect the confidentiality of the secure assessment materials. Premature disclosure of these results would significantly impede implementation of the NAEP assessment program, and is therefore protected by exemption 9(B) of section 552b(c) of Title 5 United States Code.
The Board's standing committees will meet to conduct regularly scheduled work, based on agenda items planned for this quarterly Board meeting, and follow up items as reported in the Board's committee meeting minutes available at
The Executive Committee will convene in open session on August 6, 2015 from 4:30 p.m. to 5:20 p.m. and
On August 7, 2015, the full Board will meet in open session from 8:30 a.m. to 10:15 a.m. The Board will review and approve the August 6-7, 2015 Board meeting agenda and meeting minutes from the May 2015 Quarterly Board meeting. This session will be followed by the Chairman's remarks and welcome remarks from the Governing Board's new Executive Director, Bill Bushaw. Thereafter, the full Board will receive a briefing on the Trial Urban District Assessments (TUDA) and implications for education reforms from Michael Casserly, Executive Director of the Council of the Great City Schools. The briefing will be followed by update reports from the Acting Director of the Institute of Education Sciences, Sue Betka, and the Acting Commissioner of the National Center for Education Statistics, Peggy Carr. The Board will recess for Committee meetings from 10:15 a.m. to 12:30 p.m.
The Reporting and Dissemination Committee will meet in open session from 10:15 a.m. to 12:30 p.m.
The Committee on Standards, Design and Methodology (COSDAM) will meet in open session from 10:15 a.m. to 11:45 a.m. and thereafter in closed session from 11:45 a.m. to 12:30 p.m. During the closed session COSDAM will discuss information regarding analyses of the 2014 grade 8 Technology and Engineering Literacy (TEL) assessment, and discuss secure NAEP TEL data. This part of the meeting must be conducted in closed session because the analysis involves the use of secure data for the NAEP TEL assessment. Public disclosure of secure data would significantly impede implementation of the NAEP assessment program if conducted in open session. Such matters are protected by exemption 9(B) of section 552b of Title 5 U.S.C.
The Assessment Development Committee will meet in open session from 10:15 a.m. to 11:10 a.m. and thereafter in closed session from 11:10 a.m. to 12:30 p.m. During the closed session, the Committee will receive a briefing on transitioning NAEP to Digital-Based Assessments (DBA). The briefing will be in-depth, with discussion of secure NAEP reading and mathematics test questions for the 2017 operational assessments at grades 4 and 8, and secure items at grades 8 and 12 in U.S. history, civics, and geography for the 2018 operational assessments. This part of the meeting must be conducted in closed session because the items are to be used in NAEP assessments; public disclosure of secure test items would significantly impede implementation of the NAEP assessment program if conducted in open session. Such matters are protected by exemption 9(B) of section 552b of Title 5 U.S.C.
Following the Committee meetings, the Board will convene in closed session from 12:45 p.m. to 2:45 p.m. The closed session will for the Board to receive a briefing and discuss the NAEP 2015 Report Cards in Reading and Mathematics for grades 4 and 8 national and state data. This part of the meeting must be conducted in closed session because results of these NAEP assessments have been embargoed and are not ready for public release. Public disclosure of this information would likely have an adverse technical and financial impact on the NAEP program. Discussion of this information would be likely to significantly impede implementation of a proposed agency action if conducted in open session. Such matters are protected by exemption 9(B) of section 552b of Title 5 U.S.C.
Thereafter, the Board will meet in open session from 2:45 p.m. to 5:00 p.m. From 3:15-4:15 p.m., the Board will meet in breakout sessions by groups comprised of NAGB members established by the Chairman to discuss the Governing Board's Strategic Planning Initiative. The Board will then convene from 4:30 p.m. to 5:30 p.m. to receive reports from the group breakouts and engage in discussions prior to taking action on the Governing Board's Strategic Planning Framework.
The August 7, 2015 session of the Board meeting will adjourn at 5:30 p.m.
On August 8, 2015, the Nominations Committee will meet in closed session from 7:30 a.m. to 8:15 a.m. to discuss candidates for six Board vacancies for terms beginning on October 1, 2016. The Committee's discussions pertain solely to internal personnel rules and practices of an agency and information of a personal nature where disclosure would constitute an unwarranted invasion of personal privacy. As such, the discussions are protected by exemptions 2 and 6 of section 552b(c) of Title 5 of the United States Code.
On Saturday, August 8, the full Board will meet in closed session from 8:30 a.m. to 10:00 a.m. to discuss preliminary information regarding the 2014 grade 8 Technology and Engineering Literacy (TEL) assessment and achievement levels setting process. This part of the meeting must be conducted in closed session because it involves secure items and data for the NAEP TEL assessment. Public disclosure of secure items and data would significantly impede implementation of the NAEP assessment program if conducted in open session. Such matters are protected by exemption 9(B) of section 552b of Title 5 U.S.C.
From 10:15 a.m. to 11:15 a.m. the Board will discuss and take action on the Assessment Literacy Communications Plan. Outgoing Board members whose terms expire in September 2015 will provide remarks from 11:15 a.m. to 11:30 a.m.
The Board will receive reports from the standing committees and take action proposed by the Executive and Reporting Committees from 11:30 a.m. to 12:00 p.m. as follows:
1. Executive Committee: Election of Board Vice Chair for 2015-2016
2. Executive Committee: Budget Resolution on NAEP Funding
3. Reporting and Dissemination Committee: Release Plan for 2015 Reading and Mathematics Report Cards.
The August 8, 2015 meeting is scheduled to adjourn at 12:00 p.m.
You may also access documents of the Department published in the
Pub. L. 107-279, Title III—National Assessment of Educational Progress section 301.
Office of Special Education and Rehabilitative Services, Department of Education.
Notice.
Catalog of Federal Domestic Assistance (CFDA) Number: 84.250Z.
Under section 121(a) the Department currently supports 83 projects that provide VR services to American Indians with disabilities, consistent with each individual's strengths, resources, priorities, concerns, abilities, capabilities, interests, and informed choice, so that they may prepare for, and engage in, high-quality competitive integrated employment that will increase opportunities for economic self-sufficiency.
To help determine funding priorities, section 121(c)(3) of the Act requires RSA to survey the governing bodies of Indian tribes operating AIVRS projects to identify their training and TA needs. RSA's survey of the AIVRS grantees conducted in January 2015 resulted in a 50 percent response rate and indicated training and TA needs in five primary areas: (1) Knowledge of applicable laws and regulations governing the AIVRS program; (2) staff development and service provision (
The priority is:
This priority supports a five-year cooperative agreement to establish an American Indian Vocational Rehabilitation Services (AIVRS) Training and Technical Assistance Center (Center) to provide three different types of training and technical assistance (TA) for AIVRS projects: (1) Intensive, sustained training and TA;
(a) Applicable laws and regulations governing the AIVRS program;
(b) Promising practices for providing services to American Indians with disabilities;
(c) The delivery of services to American Indians with disabilities, including the determination of eligibility, case management, case record documentation, assessment, development of the individualized plan for employment, and placement into competitive integrated employment;
(d) Knowledge of assistive technology (AT), including what AT is, how to evaluate the need for AT, use of AT, and access to AT;
(e) Implementing professional development practices to ensure effective project coordination, administration, and management;
(f) Implementing appropriate financial and grant management practices to ensure compliance with OMB's Uniform Guidance (2 CFR 200) and the Education Department General Administrative Regulations (EDGAR); and
(g) Evaluating program performance, including data collection, data analysis, and reporting.
Specific topics for training and TA in each of these priority areas will be identified on an annual basis and in coordination with the Rehabilitation Services Administration (RSA).
To be considered for funding under this priority, the Center must, at a minimum, conduct the following activities in a culturally appropriate manner:
(a) Develop and provide intensive, sustained training and TA to a minimum of three AIVRS projects in the first year. For future years, the minimum number of AIVRS projects to receive intensive, sustained training and TA will be negotiated through the Cooperative Agreement. The Center must—
(1) Develop and implement training and TA consistent with AIVRS project activities and tailored to the specific needs and challenges of the AIVRS project receiving the intensive training and TA;
(2) Provide training and TA under an agreement with each AIVRS project receiving intensive training and TA that, at a minimum, details the purpose of the training and TA, intended outcomes, and requirements for the subsequent evaluation of the training and TA; and
(3) Assess the results of the training and TA 90 days after its completion to ensure that the recipient is able to apply effectively the training and TA, identify any issues or challenges in its implementation, and provide additional training and TA, either virtually or on-site, as needed;
(b) Provide a range of targeted, specialized training and TA in the topic areas described in this priority based on needs common to multiple AIVRS projects. The Center must follow-up with recipients of targeted, specialized training and TA in order to determine the effectiveness of the training and TA;
(c) Provide universal, general training and TA in the topic areas in this priority;
(d) Provide a minimum of two Webinars or video conferences in each of the topic areas in this priority to describe and disseminate up-to-date information, guides, examples, and emerging and promising practices in each area; and
(e) Develop new information technology (IT) platforms and systems, or modify existing platforms and systems, as follows:
(i) Develop and maintain a state-of-the-art IT platform sufficient to support Webinars, teleconferences, video conferences, and other virtual methods of dissemination of information and TA;
(ii) Develop and maintain a state-of-the-art archiving and dissemination system that is open and available to all AIVRS projects and that provides a central location for training and TA products for later use, including course curricula, audiovisual materials, Webinars, examples of promising practices related to the topic areas in this priority, the primary areas identified through the annual surveys completed by AIVRS projects, other topics identified by RSA, and other relevant TA products;
(iii) Ensure that all products, resources, and materials developed by the Center are widely disseminated across the AIVRS projects and reflect the AIVRS population and diversity among its communities to the maximum extent possible;
(f) Establish a community of practice
(g) Conduct outreach to AIVRS projects so that they are aware of, and can participate in, training and TA activities; and
(h) Conduct an evaluation to determine the quality, relevance, and usefulness of the Center's training and TA, including the impact of the Center's activities on the ability of AIVRS grantees to manage effectively their projects and improve the delivery of VR services to American Indians with disabilities.
To be funded under this priority, applicants must meet the application and administrative requirements in this priority. RSA encourages innovative approaches to meet these requirements, which are:
(a) Demonstrate in the narrative section of the application under “Significance of the Proposed Project” how the proposed project will—
(1) Use the applicant's knowledge and experience in the operation of AIVRS projects in order to provide training and TA for these projects;
(2) Address the AIVRS grantees' capacity to implement effectively an AIVRS project. To meet this requirement, the applicant must:
(i) Demonstrate knowledge of emerging and promising practices in the topic areas in this priority;
(ii) Demonstrate knowledge of current RSA guidance and Federal initiatives designed to improve the functioning of grant programs in general and grant programs for American Indian tribes in particular; and
(iii) Present information about the difficulties that AIVRS grantees have encountered in implementing effective AIVRS projects;
(b) Demonstrate in the narrative section of the application under “Quality of Project Design” how the proposed project will—
(1) Achieve its goals, objectives, and intended outcomes. To meet this requirement, the applicant must provide—
(i) Measurable intended project outcomes;
(ii) A plan for how the proposed project will achieve its intended outcomes;
(iii) A plan for communicating and coordinating with RSA and key staff in AIVRS projects; and
(iv) A draft training module for one of the topic areas in this priority to demonstrate how participants would be trained in that area. The module is a required attachment in the application and must include, at a minimum, the following:
(A) The goals and objectives of this training module;
(B) A specific list of what participants should know and be able to do as a result of successfully completing the module;
(C) Up-to-date resources, publications, applicable laws and regulations, and other materials that may be used to develop the module;
(D) Exercises that will provide an opportunity for application of the subject matter; and
(E) A description of how participant knowledge, skills, and abilities will be measured;
(2) Use a logic model
(3) Be based on current research and make use of emerging and promising practices, and evidence-based practices, where available. To meet this requirement the applicant must describe—
(i) The current research on the emerging and promising practices in the topic areas in this priority; and
(ii) How the Center will incorporate current research and promising and evidence-based practices, including research about adult learning principles and implementation science, in the development and delivery of its products and services;
(4) Develop products and provide services that are of high quality and sufficient intensity and duration to achieve the intended outcomes of the proposed project. To address this requirement the applicant must describe—
(i) Its proposed approach to universal, general training and TA;
(ii) Its proposed approach to targeted, specialized training and TA, which must identify—
(A) The intended recipients of the products and services under this approach, including the categories of personnel that would be receiving the training and TA;
(B) Its proposed medium for providing targeted, specialized training and TA; and
(C) Its proposed methodology for determining topics for the targeted, specialized training and TA;
(iii) Its proposed approach to intensive, sustained training and TA, which must identify—
(A) Its proposed approach to identifying recipients for intensive, sustained training and TA;
(B) Its proposed methodology for providing intensive, sustained training and TA to recipients; and
(C) Its proposed approach to assessing the training and TA needs of recipients, including their ability to respond effectively to the training and TA;
(5) Develop products and implement services to maximize the proposed project's efficiency. To address this requirement, the applicant must describe—
(i) How the proposed project will use technology to achieve the intended project outcomes; and
(ii) With whom the proposed project will collaborate and the intended outcomes of this collaboration;
(c) Demonstrate in the narrative section of the application under “Adequacy of Project Resources” how—
(1) The applicant and any key partners possess adequate resources to carry out the proposed activities; and
(2) The proposed costs are reasonable in relation to the anticipated results and benefits;
(d) Demonstrate in the narrative section of the application under “Quality of Project Personnel” how—
(1) The proposed project will encourage applications for employment from persons who are members of groups that have historically been underrepresented based on race, color, national origin, gender, age, or disability, as appropriate; and
(2) The proposed key project personnel, consultants, and subcontractors have the qualifications and experience to provide training and TA to AIVRS projects in each of the topic areas in this priority and to achieve the project's intended outcomes;
(e) Demonstrate in the narrative section of the application under “Quality of the Management Plan” how the proposed management plan will ensure that the project's intended outcomes will be achieved on time and within budget. To address this requirement, the applicant must describe—
(1) Clearly defined roles and responsibilities for two full-time key project personnel designated to the Center through the entire project period and for consultants and subcontractors, as applicable;
(2) Timelines and milestones for accomplishing the project tasks;
(3) By using a personnel loading chart, detail project activities through the entire project period, key personnel and any consultants or subcontractors that will be allocated to each activity, and the designated level of effort for each of those activities;
(4) How the personnel allocations in the personnel loading chart are appropriate and adequate to achieve the project's intended outcomes, including an assurance that all personnel will communicate with stakeholders and RSA in a timely fashion;
(5) How the proposed management plan will ensure that the training and TA products developed through this cooperative agreement are complete, accurate, and of high quality; and
(6) How the proposed project will benefit from a diversity of perspectives, including AIVRS projects and consumers, State VR agencies, TA providers, and policy makers, in its development and operation;
(f) Demonstrate in the narrative section of the application under “Quality of the Evaluation Plan” how the applicant proposes to collect and analyze data on specific and measurable goals, objectives, and intended outcomes of the project, including the effectiveness of the training and TA provided. To address this requirement, the applicant must describe—
(i) Its proposed evaluation methodologies, including instruments, data collection methods, and analyses;
(ii) Its proposed standards or targets for determining effectiveness;
(iii) How it will use the evaluation results to examine the effectiveness of its implementation and its progress toward achieving the intended outcomes; and
(iv) How the methods of evaluation will produce quantitative and qualitative data that demonstrate whether the project and individual training and TA activities achieved their intended outcomes.
The regulations in 34 CFR part 86 apply to institutions of higher education only.
The Department is not bound by any estimates in this notice.
In deciding whether to continue funding the Center for the fourth and fifth years, the Department, as part of the review of the cooperative agreement, the application narrative, and the annual performance reports will consider the degree to which the Center demonstrates substantial progress in providing intensive, sustained training and TA to AIVRS projects; targeted, specialized training and TA to AIVRS projects; and universal, general training and TA to AIVRS projects, and the extent to which the training and TA provided has had an impact on the ability of AIVRS projects to implement appropriate practices in the seven areas outlined in the priority.
1.
2.
1.
You can contact ED Pubs at its Web site, also:
If you request an application from ED Pubs, be sure to identify this competition as follows: CFDA number 84.250Z.
Individuals with disabilities can obtain a copy of the application package in an accessible format (
Page Limit: The application narrative (Part III of the application) is where you, the applicant, address the selection criteria that reviewers use to evaluate your application. Because of the limited time available to review applications and make a recommendation for funding, we strongly encourage applicants to limit the application narrative to no more than 45 pages, using the following standards:
• A “page” is 8.5″ x 11″, on one side only, with 1″ margins at the top, bottom, and both sides.
• Double space (no more than three lines per vertical inch) all text in the application narrative, including titles, headings, footnotes, quotations, references, and captions, as well as all text in charts, tables, figures, and graphs.
• Use a font that is either 12 point or larger or no smaller than 10 pitch (characters per inch).
• Use one of the following fonts: Times New Roman, Courier, Courier New, or Arial. An application submitted in any other font (including Times Roman or Arial Narrow) will not be accepted.
In addition to the page-limit guidance on the application narrative section, we recommend that you adhere to the following page limits, using the standards listed above: (1) The abstract should be no more than one page, (2) the resumes of key personnel should be no more than two pages per person, and (3) the bibliography should be no more than three pages. A personnel loading chart and a draft training model are required attachments in the application. There are no page limits or standards for these attachments. The only optional materials that will be accepted are letters of support. Please note that our reviewers are not required to read optional materials.
Please note that any funded applicant's application abstract will be made available to the public.
3.
Applications for grants under this competition must be submitted electronically using the Grants.gov Apply site (Grants.gov). For information (including dates and times) about how to submit your application electronically, or in paper format by mail or hand delivery if you qualify for an exception to the electronic submission requirement, please refer to section IV. 7.
We do not consider an application that does not comply with the deadline requirements.
Individuals with disabilities who need an accommodation or auxiliary aid in connection with the application process should contact the person listed under
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6.
a. Have a Data Universal Numbering System (DUNS) number and a Taxpayer Identification Number (TIN);
b. Register both your DUNS number and TIN with the System for Award Management (SAM) (formerly the Central Contractor Registry (CCR)), the Government's primary registrant database;
c. Provide your DUNS number and TIN on your application; and
d. Maintain an active SAM registration with current information while your application is under review by the Department and, if you are awarded a grant, during the project period.
You can obtain a DUNS number from Dun and Bradstreet. A DUNS number can be created within one to two business days.
If you are a corporate entity, agency, institution, or organization, you can obtain a TIN from the Internal Revenue Service. If you are an individual, you can obtain a TIN from the Internal Revenue Service or the Social Security Administration. If you need a new TIN, please allow two to five weeks for your TIN to become active.
The SAM registration process can take approximately seven business days, but may take upwards of several weeks, depending on the completeness and accuracy of the data entered into the SAM database by an entity. Thus, if you think you might want to apply for Federal financial assistance under a program administered by the Department, please allow sufficient time to obtain and register your DUNS number and TIN. We strongly recommend that you register early.
Once your SAM registration is active, you will need to allow 24 to 48 hours for the information to be available in Grants.gov and before you can submit an application through Grants.gov.
If you are currently registered with SAM, you may not need to make any changes. However, please make certain that the TIN associated with your DUNS number is correct. Also note that you will need to update your registration annually. This may take three or more business days.
Information about SAM is available at
In addition, if you are submitting your application via Grants.gov, you must (1) be designated by your organization as an Authorized Organization Representative (AOR); and (2) register yourself with Grants.gov as an AOR. Details on these steps are outlined at the following Grants.gov Web page:
7.
a.
Applications for grants under the AIVRS—Training and Technical Assistance program, CFDA number 84.250Z, must be submitted electronically using the Governmentwide Grants.gov Apply site at
We will reject your application if you submit it in paper format unless, as described elsewhere in this section, you qualify for one of the exceptions to the electronic submission requirement
You may access the electronic grant application for the AIVRS—Training and Technical Assistance program at
Please note the following:
• When you enter the Grants.gov site, you will find information about submitting an application electronically through the site, as well as the hours of operation.
• Applications received by Grants.gov are date and time stamped. Your application must be fully uploaded and submitted and must be date and time stamped by the Grants.gov system no later than 4:30:00 p.m., Washington, DC time, on the application deadline date. Except as otherwise noted in this section, we will not accept your application if it is received—that is, date and time stamped by the Grants.gov system—after 4:30:00 p.m., Washington, DC time, on the application deadline date. We do not consider an application that does not comply with the deadline requirements. When we retrieve your application from Grants.gov, we will notify you if we are rejecting your application because it was date and time stamped by the Grants.gov system after 4:30:00 p.m., Washington, DC time, on the application deadline date.
• The amount of time it can take to upload an application will vary depending on a variety of factors, including the size of the application and the speed of your Internet connection. Therefore, we strongly recommend that you do not wait until the application deadline date to begin the submission process through Grants.gov.
• You should review and follow the Education Submission Procedures for submitting an application through Grants.gov that are included in the application package for this competition to ensure that you submit your application in a timely manner to the Grants.gov system. You can also find the Education Submission Procedures pertaining to Grants.gov under News and Events on the Department's G5 system home page at
• You will not receive additional point value because you submit your application in electronic format, nor will we penalize you if you qualify for an exception to the electronic submission requirement, as described elsewhere in this section, and submit your application in paper format.
• You must submit all documents electronically, including all information you typically provide on the following forms: The Application for Federal Assistance (SF 424), the Department of Education Supplemental Information for SF 424, Budget Information—Non-Construction Programs (ED 524), and all necessary assurances and certifications.
• You must upload any narrative sections and all other attachments to your application as files in a PDF (Portable Document) read-only, non-modifiable format. Do not upload an interactive or fillable PDF file. If you upload a file type other than a read-only, non-modifiable PDF or submit a
• Your electronic application must comply with any page-limit requirements described in this notice.
• After you electronically submit your application, you will receive from Grants.gov an automatic notification of receipt that contains a Grants.gov tracking number. (This notification indicates receipt by Grants.gov only, not receipt by the Department.) The Department then will retrieve your application from Grants.gov and send a second notification to you by email. This second notification indicates that the Department has received your application and has assigned your application a PR/Award number (an ED-specified identifying number unique to your application).
• We may request that you provide us original signatures on forms at a later date.
If you are prevented from electronically submitting your application on the application deadline date because of technical problems with the Grants.gov system, we will grant you an extension until 4:30:00 p.m., Washington, DC time, the following business day to enable you to transmit your application electronically or by hand delivery. You also may mail your application by following the mailing instructions described elsewhere in this notice.
If you submit an application after 4:30:00 p.m., Washington, DC time, on the application deadline date, please contact the person listed under
The extensions to which we refer in this section apply only to the unavailability of, or technical problems with, the Grants.gov system. We will not grant you an extension if you failed to fully register to submit your application to Grants.gov before the application deadline date and time or if the technical problem you experienced is unrelated to the Grants.gov system.
• You do not have access to the Internet; or
• You do not have the capacity to upload large documents to the Grants.gov system;
• No later than two weeks before the application deadline date (14 calendar days or, if the fourteenth calendar day before the application deadline date falls on a Federal holiday, the next business day following the Federal holiday), you mail or fax a written statement to the Department, explaining which of the two grounds for an exception prevents you from using the Internet to submit your application.
If you mail your written statement to the Department, it must be postmarked no later than two weeks before the application deadline date. If you fax your written statement to the Department, we must receive the faxed statement no later than two weeks before the application deadline date.
Address and mail or fax your statement to: Thomas Finch, U.S. Department of Education, 400 Maryland Avenue SW., Room 5147, Washington, DC 20202-2800. FAX: (202) 245-7592.
Your paper application must be submitted in accordance with the mail or hand delivery instructions described in this notice.
b.
If you qualify for an exception to the electronic submission requirement, you may mail (through the U.S. Postal Service or a commercial carrier) your application to the Department. You must mail the original and two copies of your application, on or before the application deadline date, to the Department at the following address: U.S. Department of Education, Application Control Center, Attention: (CFDA Number 84.250Z) LBJ Basement Level 1, 400 Maryland Avenue SW., Washington, DC 20202-4260.
You must show proof of mailing consisting of one of the following:
(1) A legibly dated U.S. Postal Service postmark.
(2) A legible mail receipt with the date of mailing stamped by the U.S. Postal Service.
(3) A dated shipping label, invoice, or receipt from a commercial carrier.
(4) Any other proof of mailing acceptable to the Secretary of the U.S. Department of Education.
If you mail your application through the U.S. Postal Service, we do not accept either of the following as proof of mailing:
(1) A private metered postmark.
(2) A mail receipt that is not dated by the U.S. Postal Service.
If your application is postmarked after the application deadline date, we will not consider your application.
The U.S. Postal Service does not uniformly provide a dated postmark. Before relying on this method, you should check with your local post office.
c.
If you qualify for an exception to the electronic submission requirement, you (or a courier service) may deliver your paper application to the Department by hand. You must deliver the original and two copies of your application by hand, on or before the application deadline date, to the Department at the following address: U.S. Department of Education, Application Control Center, Attention: (CFDA Number 84.250Z) 550 12th Street SW., Room 7039, Potomac Center Plaza, Washington, DC 20202-4260.
The Application Control Center accepts hand deliveries daily between 8:00 a.m. and 4:30:00 p.m., Washington, DC time, except Saturdays, Sundays, and Federal holidays.
If you mail or hand deliver your application to the Department—
(1) You must indicate on the envelope and—if not provided by the Department—in Item 11 of the SF 424 the CFDA number, including suffix letter, if any, of the competition under which you are submitting your application; and
(2) The Application Control Center will mail to you a notification of receipt of your grant application. If you do not receive this notification within 15 business days from the application deadline date, you should call the U.S. Department of Education Application Control Center at (202) 245-6288.
1.
2.
In addition, in making a competitive grant award, the Secretary also requires various assurances including those applicable to Federal civil rights laws that prohibit discrimination in programs or activities receiving Federal financial assistance from the Department of Education (34 CFR 100.4, 104.5, 106.4, 108.8, and 110.23).
3.
1.
If your application is not evaluated or not selected for funding, we notify you.
2.
We reference the regulations outlining the terms and conditions of an award in the
3.
(b) At the end of your project period, you must submit a final performance report, including financial information, as directed by the Secretary. If you receive a multi-year award, you must submit an annual performance report that provides the most current performance and financial expenditure information as directed by the Secretary under 34 CFR 75.118. The Secretary may also require more frequent performance reports under 34 CFR 75.720(c). For specific requirements on reporting, please go to
4.
The goal of this grant is to provide training and TA to governing bodies of Indian tribes located on Federal and State reservations (and consortia of such governing bodies) that receive grants under section 121(a) of the Act.
Pursuant to GPRA, the Department is in the process of developing performance measures for this program to assess the success of the grantee in meeting the training and TA goals of this program. In general, these measures will assess the quality, relevance, and usefulness of the training and TA provided by the Center, as well as the performance of the Center in achieving the project's intended outcomes with respect to the specific topics in each of the priority areas specified annually by RSA in the cooperative agreement. The grantee will be required to collect and annually report qualitative and quantitative data related to its performance on these measures in the Center's annual and final performance reports to the Department. The data used must be valid and verifiable.
5.
Thomas Finch, U.S. Department of Education, 400 Maryland Avenue SW., Room 5147, Potomac Center Plaza (PCP), Washington, DC 20202-2800. Telephone: (202) 245-7343 or by email:
If you use a TDD or a TTY, call the Federal Relay Service (FRS), toll free, at 1-800-877-8339.
You may also access documents of the Department published in the
Office of Special Education and Rehabilitative Services, Department of Education.
Notice.
This priority is:
The Workforce Innovation and Opportunity Act (WIOA), enacted in July of 2014, made significant changes to the Rehabilitation Act of 1973 (the Act), including adding provisions to the OIB program that require the reservation of funds to support training and technical assistance. In particular, section 751A of the Act requires the Commissioner of the Rehabilitation Services Administration (RSA) to reserve not less than 1.8 percent and not more than 2 percent of the funds appropriated to the OIB program to provide training and technical assistance to DSAs or other providers of OIB services that receive OIB program funds.
The purpose of the OIB program is to: (1) Provide independent living (IL) services to older individuals who are blind; (2) conduct activities that will improve or expand services for these individuals; and (3) conduct activities to help improve public understanding of these individuals' challenges. An “older individual who is blind” is an individual age 55 or older whose significant visual impairment makes competitive employment extremely difficult to attain but for whom independent living goals are feasible. Through these services and activities, the program seeks to improve independent living options for older individuals who are blind and increase their independence and self-sufficiency.
To help determine funding priorities, section 751A of the Act requires RSA to conduct a survey of DSAs that receive OIB program grants to determine their training and TA needs. In response to this requirement, RSA added a new section to the annual report submitted by DSAs (Section VII Training and Technical Assistance) to obtain this information.
Survey results from the most recent annual report submitted by each of the OIB program grantees identified the need for training and TA in the following areas: Fiscal and management practices, annual report (Form RSA 7-OB) reporting requirements, data analysis and program performance, service provision and service delivery, promising practices, resources and information, and outreach.
This priority supports a cooperative agreement to establish an OIB Training and Technical Assistance Center (Center) to provide sustained training and TA—generalized, targeted, and intensive—to DSAs funded under the OIB program and to any service providers the DSAs fund to provide services directly to consumers. The Center will develop and provide training and TA to DSAs and other service providers funded under the OIB program in the following general topic areas:
(a) Community outreach;
(b) Best practices in the provision and delivery of services;
(c) Program performance, including data reporting and analysis; and
(d) Financial and management practices, including practices to ensure compliance with grant administration requirements.
To meet the requirements of this priority, the Center must, at a minimum, conduct the following activities:
(a) Annually provide intensive training and TA to a minimum of three DSAs and other service providers on the topic areas in this priority. The TA must be:
(1) Consistent with the project activities and tailored to the specific needs and challenges of the DSA or other service provider receiving the intensive training and TA;
(2) Provided under an agreement with each DSA or other service provider that, at a minimum, details the purpose, intended outcomes, and requirements for subsequent evaluation of the training and TA; and
(3) Assessed 90 days after completion to ensure that DSAs and other service providers receiving intensive training and TA are applying it effectively and to address any issues or challenges in its implementation.
(b) Provide a range of targeted and general training and TA products and services on the general topic areas in this priority. The training and TA should include, at a minimum, the following activities:
(1) Provide a minimum of two Webinars or video conferences on each of the topic areas in this priority to describe and disseminate information about emerging and best practices in each area.
(2) Develop new information technology (IT) platforms or systems, or modify existing platforms and systems, as follows:
(i) Develop and maintain a state-of-the-art IT platform sufficient to support Webinars, teleconferences, video conferences, and other virtual methods of dissemination of information and training and TA;
(ii) Develop and maintain a state-of-the-art archiving and dissemination system that is open and available to the public and that provides a central location for later use of training and TA products, including course curricula, audiovisual materials, Webinars, examples of emerging and best practices related to the topic areas in this priority, and any other training and TA products.
All products produced by the Center must meet government and industry-recognized standards for accessibility.
(c) Conduct outreach to DSAs so that they are aware of and can participate in training and TA activities.
(d) Establish a community of practice
(e) Communicate and coordinate, on an ongoing basis, with other federally funded training and TA projects, particularly Department-funded projects and the Training and Technical Assistance grant for Centers for Independent Living supported by the Department of Health and Human Services, to ensure that training and TA activities are complementary and non-duplicative;
(f) Conduct an evaluation to determine the impact of the Center's training and TA on the DSAs and other service providers that received the Center's services.
To be funded under this priority, applicants must meet the application and administrative requirements in this priority. RSA encourages innovative approaches to meet these requirements, which are:
(a) Demonstrate, in the narrative section of the application under “Significance of the Project,” how the proposed project will—
(1) Address DSAs' capacity to implement effectively an OIB program. To meet this requirement, the applicant must:
(i) Demonstrate knowledge of emerging and best practices in the topic areas in this priority;
(ii) Demonstrate knowledge of current RSA guidance and State and Federal initiatives designed to improve the functioning of grant programs in general, the OIB program in particular, and independent living outcomes for older individuals who are blind; and
(iii) Present information about the difficulties that DSAs and service providers have encountered in implementing effective OIB programs.
(2) Increase both the efficiency and effectiveness of the OIB program.
(b) Demonstrate, in the narrative section of the application under “Quality of Project Services,” how the proposed project will—
(1) Achieve its goals, objectives, and intended outcomes. To meet this requirement, the applicant must provide—
(i) Measurable intended project outcomes;
(ii) A plan for how the proposed project will achieve its intended outcomes;
(iii) A plan for communicating and coordinating with key staff in DSAs and other service providers; and
(iv) A draft training module for one of the topic areas in this priority to serve as an example of how participants would be trained in that area. The module is a required attachment in the application and must include, at a minimum, the following:
(A) The goals and objectives of this training module;
(B) A specific list of what participants should know and be able to do as a result of successfully completing the module;
(C) Up-to-date resources, publications, applicable laws and regulations, and other materials that may be used to supplement the module;
(D) Exercises that will provide an opportunity for application of the module's subject matter; and
(E) A description of how participant knowledge, skills, and abilities will be measured.
(2) Use a logic model to develop project plans and activities that includes, at a minimum, the goals, activities, outputs, and outcomes of the proposed project.
For purposes of this priority, a “logic model” is defined in 34 CFR 77.1(c). The following Web sites provide more information on logic models:
(3) Be based on current research and make use of emerging and promising practices, and evidence-based practices, where available. To meet this requirement, the applicant must describe—
(i) The current research on the emerging and promising practices in the topic areas in this priority; and
(ii) How the Center will incorporate current research and promising and evidence-based practices, including research about adult learning principles and implementation science, in the development and delivery of its products and services.
(4) Develop products and provide services that are of high quality and sufficient intensity and duration to achieve the intended outcomes of the proposed project. To address this requirement, the applicant must describe—
(i) Its proposed approach to universal, general training and TA;
(ii) Its proposed approach to targeted, specialized training and TA,
(A) The intended recipients of the products and services under this approach, including the categories of personnel that would be receiving the training and TA;
(B) Its proposed medium for providing targeted, specialized training and TA; and
(C) Its proposed methodology for determining topics for the targeted, specialized training and TA.
(iii) Its proposed approach to intensive, sustained training and TA,
(A) Its proposed approach to identifying recipients for intensive, sustained training and TA products and services;
(B) Its proposed approach to assessing the training and TA needs of recipients, including their ability to respond effectively to the training and TA; and
(C) Its proposed methodology for providing intensive, sustained training and TA.
(5) Develop products and implement services to maximize the project's efficiency. To address this requirement, the applicant must describe—
(i) How the proposed project will use technology to achieve the intended project outcomes; and
(ii) With whom the proposed project will collaborate and the intended outcomes of this collaboration.
(c) Demonstrate, in the narrative section of the application under “Quality of Evaluation Plan,” how the proposed project will—
(1) Measure and track the effectiveness of the training and TA provided. To meet this requirement, the applicant must describe its proposed approach to—
(i) Collecting data on the effectiveness of each training and TA activity from DSAs and other service providers, or other sources, as appropriate; and
(ii) Analyzing the collection of data to determine the effectiveness of each training and TA activity using any proposed standards or targets for determining effectiveness.
(2) Collect and analyze data on specific and measurable goals, objectives, and progress on intended outcomes of the project to measure and track the effectiveness of the training and TA provided. To address this requirement, the applicant must describe—
(i) Its proposed evaluation methodologies, including instruments, data collection methods, and analyses;
(ii) Its proposed standards or targets for determining effectiveness;
(iii) How it will use the evaluation results to examine the effectiveness of its implementation and its progress toward achieving the intended outcomes; and
(iv) How the methods of evaluation will produce quantitative and qualitative data that demonstrate whether the project and individual training and TA activities achieved their intended outcomes.
(d) Demonstrate, in the narrative section of the application under “Quality of Project Personnel,” how—
(1) The proposed project will encourage applications for employment from persons who are members of groups that have traditionally been underrepresented based on race, color, national origin, gender, age, or disability, as appropriate; and
(2) The proposed key project personnel, consultants, and subcontractors have the qualifications and experience to provide training and TA to DSAs and other service providers in each of the topic areas in this priority and to achieve the project's intended outcomes.
(e) Demonstrate, in the narrative section of the application under “Adequacy of Project Resources,” how—
(1) The applicant and any key partners have adequate resources to carry out the proposed activities; and
(2) The proposed costs are reasonable in relation to the anticipated results and benefits.
(f) Demonstrate, in the narrative section of the application under “Quality of the Management Plan,” how—
(1) The proposed management plan will ensure that the project's intended outcomes will be achieved on time and within budget. To address this requirement, the applicant must describe—
(i) Clearly defined responsibilities for key project personnel, consultants, and subcontractors, as applicable; and
(ii) Timelines and milestones for accomplishing the project tasks.
(2) Key project personnel and any consultants and subcontractors will be allocated to the project and how these allocations are appropriate and adequate to achieve the project's intended outcomes, including an assurance that such personnel will have adequate availability to ensure timely communications with stakeholders and RSA;
(3) The proposed management plan will ensure that the products and services provided are of high quality; and
(4) The proposed project will benefit from a diversity of perspectives, including those of State and local personnel, training and TA providers, policy makers, OIB program consumers, and intended beneficiaries of the training, among others, in its development and operation.
The regulations in 34 CFR part 86 apply to institutions of higher education only.
The Department is not bound by any estimates in this notice.
1.
2.
1.
To obtain a copy from ED Pubs, write, fax, or call the following: ED Pubs, U.S. Department of Education, P.O. Box 22207, Alexandria, VA 22304. Telephone, toll free: 1-877-433-7827. FAX: (703) 605-6794. If you use a telecommunications device for the deaf (TDD) or a text telephone (TTY), call, toll free: 1-877-576-7734.
You can contact ED Pubs at its Web site, also:
If you request an application from ED Pubs, be sure to identify this program as follows: CFDA number 84.177Z.
Individuals with disabilities can obtain a copy of the application package in an accessible format (
2. a.
Requirements concerning the content of an application, together with the forms you must submit, are in the application package for this program.
b.
Given the types of projects that may be proposed in applications for the Independent Living Services for Older Individuals Who Are Blind Training and Technical Assistance program, an application may include business information that the applicant considers proprietary. The Department's regulations define “business information” in 34 CFR 5.11.
Because the funded applicant's abstract will be made available to the public, you may wish to request confidentiality of business information.
Consistent with Executive Order 12600, please designate in your application any information that you feel is exempt from disclosure under Exemption 4 of the Freedom of Information Act. In the appropriate Appendix section of your application, under “Other Attachments Form,” please list the page number or numbers on which we can find this information. For additional information please see 34 CFR 5.11(c).
3.
Applications for grants under this program must be submitted electronically using the Grants.gov Apply site (Grants.gov). For information (including dates and times) about how to submit your application electronically, or in paper format by mail or hand delivery if you qualify for an exception to the electronic submission requirement, please refer to section IV. 7.
We do not consider an application that does not comply with the deadline requirements.
Individuals with disabilities who need an accommodation or auxiliary aid in connection with the application process should contact the person listed under
4.
5.
6.
a. Have a Data Universal Numbering System (DUNS) number and a Taxpayer Identification Number (TIN);
b. Register both your DUNS number and TIN with the System for Award Management (SAM) (formerly the Central Contractor Registry (CCR)), the Government's primary registrant database;
c. Provide your DUNS number and TIN on your application; and
d. Maintain an active SAM registration with current information while your application is under review by the Department and, if you are awarded a grant, during the project period.
You can obtain a DUNS number from Dun and Bradstreet. A DUNS number can be created within one to two business days.
If you are a corporate entity, agency, institution, or organization, you can obtain a TIN from the Internal Revenue Service. If you are an individual, you can obtain a TIN from the Internal Revenue Service or the Social Security Administration. If you need a new TIN, please allow 2-5 weeks for your TIN to become active.
The SAM registration process can take approximately seven business days, but may take upwards of several weeks, depending on the completeness and accuracy of the data entered into the SAM database by an entity. Thus, if you think you might want to apply for Federal financial assistance under a program administered by the Department, please allow sufficient time to obtain and register your DUNS number and TIN. We strongly recommend that you register early.
Once your SAM registration is active, you will need to allow 24 to 48 hours for the information to be available in Grants.gov and before you can submit an application through Grants.gov.
If you are currently registered with SAM, you may not need to make any changes. However, please make certain that the TIN associated with your DUNS number is correct. Also note that you will need to update your registration annually. This may take three or more business days.
Information about SAM is available at
In addition, if you are submitting your application via Grants.gov, you must (1) be designated by your organization as an Authorized Organization Representative (AOR); and (2) register yourself with Grants.gov as an AOR. Details on these steps are outlined at the following Grants.gov Web page:
7.
Applications for grants under this program must be submitted electronically unless you qualify for an exception to this requirement in accordance with the instructions in this section.
a.
Applications for grants under the Independent Living Services for Older Individuals Who Are Blind Training and Technical Assistance program, CFDA number 84.177Z, must be submitted electronically using the Governmentwide Grants.gov Apply site at
We will reject your application if you submit it in paper format unless, as described elsewhere in this section, you qualify for one of the exceptions to the electronic submission requirement
You may access the electronic grant application for the Independent Living Services for Older Individuals Who Are Blind Training and Technical Assistance program at
Please note the following:
• When you enter the Grants.gov site, you will find information about submitting an application electronically through the site, as well as the hours of operation.
• Applications received by Grants.gov are date and time stamped. Your application must be fully uploaded and submitted and must be date and time stamped by the Grants.gov system no later than 4:30:00 p.m., Washington, DC time, on the application deadline date. Except as otherwise noted in this section, we will not accept your application if it is received—that is, date and time stamped by the Grants.gov system—after 4:30:00 p.m., Washington, DC time, on the application deadline date. We do not consider an application that does not comply with the deadline requirements. When we retrieve your application from Grants.gov, we will notify you if we are rejecting your application because it was date and time stamped by the Grants.gov system after 4:30:00 p.m., Washington, DC time, on the application deadline date.
• The amount of time it can take to upload an application will vary depending on a variety of factors, including the size of the application and the speed of your Internet connection. Therefore, we strongly recommend that you do not wait until the application deadline date to begin the submission process through Grants.gov.
• You should review and follow the Education Submission Procedures for submitting an application through Grants.gov that are included in the application package for this program to ensure that you submit your application in a timely manner to the Grants.gov system. You can also find the Education Submission Procedures pertaining to Grants.gov under News and Events on the Department's G5 system home page at
• You will not receive additional point value because you submit your application in electronic format, nor will we penalize you if you qualify for an exception to the electronic submission requirement, as described elsewhere in this section, and submit your application in paper format.
• You must submit all documents electronically, including all information you typically provide on the following forms: The Application for Federal Assistance (SF 424), the Department of Education Supplemental Information for SF 424, Budget Information—Non-Construction Programs (ED 524), and all necessary assurances and certifications.
• You must upload any narrative sections and all other attachments to your application as files in a PDF (Portable Document) read-only, non-modifiable format. Do not upload an interactive or fillable PDF file. If you upload a file type other than a read-only, non-modifiable PDF or submit a password-protected file, we will not review that material. Additional, detailed information on how to attach files is in the application instructions.
• Your electronic application must comply with any page-limit requirements described in this notice.
• After you electronically submit your application, you will receive from Grants.gov an automatic notification of receipt that contains a Grants.gov tracking number. (This notification indicates receipt by Grants.gov only, not receipt by the Department.) The Department then will retrieve your application from Grants.gov and send a second notification to you by email. This second notification indicates that the Department has received your application and has assigned your application a PR/Award number (an ED-specified identifying number unique to your application).
• We may request that you provide us original signatures on forms at a later date.
If you are prevented from electronically submitting your application on the application deadline date because of technical problems with the Grants.gov system, we will grant you an extension until 4:30:00 p.m., Washington, DC time, the following business day to enable you to transmit your application electronically or by hand delivery. You also may mail your application by following the mailing instructions described elsewhere in this notice.
If you submit an application after 4:30:00 p.m., Washington, DC time, on the application deadline date, please contact the person listed under
The extensions to which we refer in this section apply only to the unavailability of, or technical problems with, the Grants.gov system. We will not grant you an extension if you failed to fully register to submit your application to Grants.gov before the application deadline date and time or if the technical problem you experienced is unrelated to the Grants.gov system.
• You do not have access to the Internet; or
• You do not have the capacity to upload large documents to the Grants.gov system;
• No later than two weeks before the application deadline date (14 calendar days or, if the fourteenth calendar day before the application deadline date falls on a Federal holiday, the next business day following the Federal holiday), you mail or fax a written statement to the Department, explaining which of the two grounds for an exception prevents you from using the Internet to submit your application.
If you mail your written statement to the Department, it must be postmarked no later than two weeks before the application deadline date. If you fax your written statement to the Department, we must receive the faxed statement no later than two weeks before the application deadline date.
Address and mail or fax your statement to: Mary Williams, U.S. Department of Education, 400 Maryland Avenue SW., Room 5144, PCP, Washington, DC 20202-2800. FAX: (202) 245-7593
Your paper application must be submitted in accordance with the mail or hand delivery instructions described in this notice.
b.
If you qualify for an exception to the electronic submission requirement, you may mail (through the U.S. Postal Service or a commercial carrier) your application to the Department. You must mail the original and two copies of your application, on or before the application deadline date, to the Department at the following address: U.S. Department of Education, Application Control Center, Attention: (CFDA Number 84.177Z), LBJ Basement Level 1, 400 Maryland Avenue SW., Washington, DC 20202-4260.
You must show proof of mailing consisting of one of the following:
(1) A legibly dated U.S. Postal Service postmark.
(2) A legible mail receipt with the date of mailing stamped by the U.S. Postal Service.
(3) A dated shipping label, invoice, or receipt from a commercial carrier.
(4) Any other proof of mailing acceptable to the Secretary of the U.S. Department of Education.
If you mail your application through the U.S. Postal Service, we do not accept either of the following as proof of mailing:
(1) A private metered postmark.
(2) A mail receipt that is not dated by the U.S. Postal Service.
If your application is postmarked after the application deadline date, we will not consider your application.
The U.S. Postal Service does not uniformly provide a dated postmark. Before relying on this method, you should check with your local post office.
c.
If you qualify for an exception to the electronic submission requirement, you (or a courier service) may deliver your paper application to the Department by hand. You must deliver the original and two copies of your application by hand, on or before the application deadline date, to the Department at the following address: U.S. Department of Education, Application Control Center, Attention: (CFDA Number 84.177Z), 550 12th Street SW., Room 7039, Potomac Center Plaza, Washington, DC 20202-4260.
The Application Control Center accepts hand deliveries daily between 8:00 a.m. and 4:30:00 p.m., Washington, DC time, except Saturdays, Sundays, and Federal holidays.
If you mail or hand deliver your application to the Department—
(1) You must indicate on the envelope and—if not provided by the Department—in Item 11 of the SF 424 the CFDA number, including suffix letter, if any, of the program under which you are submitting your application; and
(2) The Application Control Center will mail to you a notification of receipt of your grant application. If you do not receive this notification within 15 business days from the application deadline date, you should call the U.S. Department of Education Application Control Center at (202) 245-6288.
1.
2.
In addition, in making a competitive grant award, the Secretary also requires various assurances including those applicable to Federal civil rights laws that prohibit discrimination in programs or activities receiving Federal financial assistance from the Department of Education (34 CFR 100.4, 104.5, 106.4, 108.8, and 110.23).
3.
1.
If your application is not evaluated or not selected for funding, we notify you.
2.
We reference the regulations outlining the terms and conditions of an award in the
3.
(b) At the end of your project period, you must submit a final performance report, including financial information, as directed by the Secretary. If you receive a multi-year award, you must submit an annual performance report that provides the most current performance and financial expenditure information as directed by the Secretary under 34 CFR 75.118. The Secretary may also require more frequent performance reports under 34 CFR 75.720(c). For specific requirements on reporting, please go to
4.
The goal of this grant is to provide training and TA designed to improve the operation and performance of OIB programs to eligible DSAs and other service providers that receive funding under chapter 2 of title VII of the Act, as amended by WIOA.
To assess the success of the grantee in meeting the training and TA goals of this program, the Department is in the process of developing performance measures. In general, these measures will assess the quality, relevance, and usefulness of the training and TA provided by the Center, as well as the performance of the Center in achieving the project's intended outcomes in the specific topics in each priority area established annually by RSA in the cooperative agreement.
The grantee will be required to collect and annually report data showing its performance on these measures in the
The annual performance report must include both quantitative and qualitative information sufficient to assess the quality, relevance, and usefulness of the training and TA provided by the Center and the progress toward training and TA objectives for that year. The data used must be valid and verifiable.
The annual performance reports must provide, at a minimum, specific information on the number of training and TA activities conducted by the Center, the topics of these activities, the type of training and TA provided (
5.
Mary Williams, U.S. Department of Education, 400 Maryland Avenue SW., Room 5144, PCP, Washington, DC 20202-2800. Telephone: (202) 245-7586 or by email:
If you use a TDD or a TTY, call the Federal Relay Service (FRS), toll free, at 1-800-877-8339.
You may also access documents of the Department published in the
Election Assistance Commission
Tuesday, July 28, 2015 at 1:00 p.m.
The Grand Hyatt Hotel, 1000 H St NW., Washington, DC 20001, Phone: (202) 582-1234.
This meeting will be open to the public.
The Commission will receive a presentation on an EAC Transition Report regarding accessibility awareness. The Commission will receive presentations on the following topics: Disability Research; Disability Access and Study of Online Voter Registration; Disability Rights and Technical Assistance to Election Officials and Poll Worker Training Materials; and Voting and the Visually Impaired. The Commission will receive a presentation on the 2014 Election Administration and Voting Survey (EAVS). The Commission may consider future development goals of the voluntary voting system guidelines (VVSG) presented in a Future VVSG Working Group White Paper. The Commission will consider advisory opinions. The Commission may consider other administrative matters.
Bryan Whitener, Telephone: (301) 563-3961.
Office of Fossil Energy, DOE.
Notice of application.
The Office of Fossil Energy (FE) of the Department of Energy (DOE) gives notice of receipt of an application (Application), filed on June 25, 2015, by Freeport LNG Development, L.P. (Freeport LNG), requesting blanket authorization to export liquefied natural gas (LNG) previously imported into the United States from foreign sources in an amount up to the equivalent of 24 billion cubic feet (Bcf) of natural gas on a short-term or spot market basis for a two-year period commencing on July 19, 2015.
Protests, motions to intervene or notices of intervention, as applicable, requests for additional procedures, and written comments are to be filed using procedures detailed in the Public Comment Procedures section no later than 4:30 p.m., Eastern time, August 20, 2015.
The Application will be reviewed pursuant to section 3 of the NGA, as amended, and the authority contained in DOE Delegation Order No. 00-002.00N (July 11, 2013) and DOE Redelegation Order No. 00-006.02 (Nov. 17, 2014). In reviewing this LNG export application, DOE will consider domestic need for the gas, as well as any other issues determined to be appropriate, including whether the arrangement is consistent with DOE's policy of promoting competition in the marketplace by allowing commercial parties to freely negotiate their own trade arrangements. Parties that may oppose this application should comment in their responses on these issues.
The National Environmental Policy Act (NEPA), 42 U.S.C. 4321
In response to this Notice, any person may file a protest, comments, or a motion to intervene or notice of intervention, as applicable. Any person wishing to become a party to the proceeding must file a motion to intervene or notice of intervention. The filing of comments or a protest with respect to the Application will not serve to make the commenter or protestant a party to the proceeding, although protests and comments received from persons who are not parties will be considered in determining the appropriate action to be taken on the Application. All protests, comments, motions to intervene, or notices of intervention must meet the requirements specified by the regulations in 10 CFR part 590.
Filings may be submitted using one of the following methods: (1) Emailing the filing to
A decisional record on the Application will be developed through responses to this notice by parties, including the parties' written comments and replies thereto. Additional procedures will be used as necessary to achieve a complete understanding of the facts and issues. If an additional procedure is scheduled, notice will be provided to all parties. If no party requests additional procedures, a final Opinion and Order may be issued based on the official record, including the Application and responses filed by parties pursuant to this notice, in accordance with 10 CFR 590.316.
The Application is available for inspection and copying in the Division of Natural Gas Regulatory Activities docket room, Room 3E-042, 1000 Independence Avenue, SW., Washington, DC 20585. The docket room is open between the hours of 8:00 a.m. and 4:30 p.m., Monday through Friday, except Federal holidays. The Application and any filed protests, motions to intervene or notice of interventions, and comments will also be available electronically by going to the following DOE/FE Web address:
1. On April 16, 2015, the Commission issued a policy statement in the referenced proceeding to provide greater certainty regarding the ability of interstate natural gas pipelines to recover the costs of modernizing their facilities and infrastructure to enhance the efficient and safe operation of their systems.
2. The
3. The
4. In the Request for Clarification, the Requesters seek what they assert is “clarification” of six points related to the
5. On June 1, INGAA and Tenaska filed answers to the request for clarification. INGAA asserts the clarification request raises issues that were addressed by the
6. As discussed more fully below, the Commission denies the requests for clarification and declines to adopt the suggested formal procedures.
7. The Commission issued the
A.
8. The
9. The Requesters ask the Commission to “clarify” the “formal procedures” for conducting the collaborative process required by the
10. The Commission denies clarification and declines to adopt formal procedures or specified rules for the pre-filing collaborative process required for a modernization cost tracker. The
11. With respect to concerns that customers may not be aware of, or be made aware of, the initiation of the collaborative process to implement a modernization cost tracker, a pipeline will have to make an NGA section 4 filing to implement any cost modernization surcharge. That filing will be noticed the same as any other NGA section 4 filing at the Commission, and will provide all interested persons the opportunity to intervene in the proceeding and to protest. Consistent with NGA section 4, the burden in that instance will be on the pipeline to demonstrate that its proposal is just and reasonable, and as we stated, the Commission will decide upon appropriate procedures to address protests based upon the specific circumstances of each proposal. Thus, in order to implement a proposed modernization cost tracker in an efficient manner and without unnecessary delay, it is in the proposing pipeline's best interest to resolve as many outstanding issues as possible through the collaborative process prior to filing a modernization cost recovery mechanism proposal.
12. The
13. Requesters assert that the
14. The Commission denies clarification. In the
15. As we made clear in the
16. Requesters also state that the Commission should clarify that if a pipeline has over-collected through a surcharge or tracker, such that its rates are later found to be unjust and unreasonable after a protest or complaint proceeding, the pipeline must pay refunds calculated from the date a protest or complaint was filed. They request a requirement that a pipeline seeking a modernization cost surcharge or tracker must agree that, if during the period that the surcharge is in effect, a protest or an NGA section 5 complaint is filed against the pipeline, the pipeline must make refunds retroactive to the date of the protest or complaint.
17. The Commission denies the requested clarification.
18. With respect to capacity releases, Requesters state that the
19. In their answers, INGAA and the NGSA oppose Requesters' proposal that cost responsibility for any modernization surcharge be placed on replacement shippers. INGAA states that under Commission policy, the releasing shipper remains ultimately liable for any surcharge amount that a replacement shipper does not pay. NGSA asserts that given the myriad of current day contracting options, the resolution of contractual matters, particularly where the contract is silent as to surcharge cost responsibility, is best left to the contracting parties. NGSA also argues that the Commission should not make a generic determination as to the responsibility for modernization cost surcharges within existing capacity release agreements because doing so would unnecessarily impede the parties' attempts to negotiate and resolve the issue.
20. The Commission denies clarification. Section 284.8(f) of the Commission's regulations
21. Finally, Requesters seek clarification that pipelines may not seek to implement a modernization cost tracker through a filing, or even commence the collaborative process, until the October 1, 2015 effective date of the
22. The Commission declines to provide the requested clarification. The Commission has no authority to regulate a pipeline's discussions with its customers or the content of such discussions. Moreover, even if it had the authority, the Commission advocates active discussions between pipelines and their customers, and as we stated in the
23. Additionally, the Commission lacks the authority to prevent a pipeline from making an NGA section 4 filing to request approval for a modernization cost tracker. As INGAA notes, the
24. Finally, we note that, as with any policy statement, the
25. The collection of information discussed in the Policy Statement is being submitted to the Office of Management and Budget (OMB) for review under section 3507(d) of the Paperwork Reduction Act of 1995
26. In the Policy Statement, the Commission solicited comments from the public on the Commission's need for this information, whether the information will have practical utility, the accuracy of the burden estimates, recommendations to enhance the quality, utility, and clarity of the information to be collected, and any suggested methods for minimizing respondents' burden, including the use of automated information techniques. The Commission received no comments on those issues.
27. The burden estimates are for implementing the information collection requirements of the Policy Statement. The collection of information related to the Policy Statement falls under FERC-545 (Gas Pipeline Rates: Rate Change (Non-Formal).
28.
The average hourly cost (salary plus benefits) to prepare the modernization cost tracker filing is $65.59. It is the average of the following hourly costs (salary plus benefits): manager ($77.93, NAICS 11-0000), Computer and mathematical ($58.17, NAICS 15-0000), Legal ($129.68, NAICS 23-0000), Office and administrative support ($39.12, NAICS 43-0000), Accountant and auditor ($51.04, NAICS 13-2011), Information and record clerk ($37.45, NAICS 43-4199), Engineer ($66.74, NAICS 17-2199), Transportation, Storage, and Distribution Manager ($64.55, NAICS 11-3071).
The average hourly cost (salary plus benefits) to perform the periodic review is $67.04. It is the average of the following hourly costs (salary plus benefits): manager ($77.93, NAICS 11-0000), Legal ($129.68, NAICS 23-0000), Office and administrative support ($39.12, NAICS 43-0000), Accountant and auditor ($51.04, NAICS 13-2011), Information and record clerk ($37.45, NAICS 43-4199).
Demonstrate that its current rates are just and reasonable and that proposal includes the types of benefits that the Commission found maintained the pipeline's incentives for innovation and efficiency;
Identify each capital investment to be recovered by the surcharge, the facilities to be upgraded or installed by those projects, and an upper limit on the capital costs related to each project to be included in the surcharge, and schedule for completing the projects;
Establish accounting controls and procedures that it will utilize to ensure that only identified eligible costs are included in the tracker;
Include method for periodic review of whether the surcharge and the pipeline's base rates remain just and reasonable; and
State the extent to which any particular project will disrupt primary firm service, explain why it expects it will not be able to continue to provide firm service, and describe what arrangements the pipeline intends to make to mitigate the disruption or provide alternative methods of providing service.
29.
30.
31.
32.
33.
34.
35.
36. Interested persons may obtain information on the reporting requirements by contacting the following: Federal Energy Regulatory Commission, 888 First Street NE., Washington, DC 20426 [Attention: Ellen Brown, Office of the Executive Director, email:
37. Comments filed with OMB, identified by the OMB Control No. 1902-0154 should be sent via email to the Office of Information and Regulatory Affairs:
The requests for clarification are denied as discussed above.
By the Commission.
The staff of the Federal Energy Regulatory Commission (FERC or Commission) will prepare an environmental assessment (EA) that will discuss the environmental impacts of the Columbia to Eastover Project involving construction and operation of facilities by Dominion South Carolina Gas, Inc (DCG) in Calhoun, Richland, and Lexington Counties, South Carolina. The Commission will use this EA in its decision-making process to determine whether the project is in the public convenience and necessity.
This notice announces the opening of the scoping process the Commission will use to gather input from the public and interested agencies on the project. You can make a difference by providing us with your specific comments or concerns about the project. Your comments should focus on the potential environmental effects, reasonable alternatives, and measures to avoid or lessen environmental impacts. Your input will help the Commission staff determine what issues they need to evaluate in the EA. To ensure that your comments are timely and properly recorded, please send your comments so that the Commission receives them in Washington, DC on or before August 17, 2015.
If you sent comments on this project to the Commission before the opening of this docket on May 29, 2015, you will need to file those comments in Docket No. CP15-504-000 to ensure they are considered as part of this proceeding.
This notice is being sent to the Commission's current environmental mailing list for this project. State and local government representatives should notify their constituents of this proposed project and encourage them to comment on their areas of concern.
If you are a landowner receiving this notice, a pipeline company representative may contact you about the acquisition of an easement to construct, operate, and maintain the proposed facilities. The company would seek to negotiate a mutually acceptable agreement. However, if the Commission approves the project, that approval conveys with it the right of eminent domain. Therefore, if easement negotiations fail to produce an agreement, the pipeline company could initiate condemnation proceedings where compensation would be determined in accordance with state law.
DCG provided landowners with a fact sheet prepared by the FERC entitled “An Interstate Natural Gas Facility On My Land? What Do I Need To Know?” This fact sheet addresses a number of typically asked questions, including the use of eminent domain and how to participate in the Commission's proceedings. It is also available for viewing on the FERC Web site (
For your convenience, there are three methods you can use to submit your comments to the Commission. The Commission encourages electronic filing of comments and has expert staff available to assist you at (202) 502-8258 or
(1) You can file your comments electronically using the eComment feature on the Commission's Web site (
(2) You can file your comments electronically by using the eFiling feature on the Commission's Web site (
(3) You can file a paper copy of your comments by mailing them to the following address. Be sure to reference the project docket number (CP15-504-000) with your submission: Kimberly D. Bose, Secretary, Federal Energy Regulatory Commission, 888 First Street NE., Room 1A, Washington, DC 20426.
DCG proposes the Columbia to Eastover Project to construct and operate 28 miles of new 8-inch-diameter
The pipeline would originate from DCG's existing 20-inch-diameter Salley to Eastman pipeline at the DAK Americas industrial facility. In addition to the pipeline, DCG proposes to install the following ancillary facilities:
• a tap and pig launcher;
• a metering and regulation station and pig receiver; and
• eight mainline valves.
The general location of the project facilities is shown in appendix 1.
Construction of the proposed facilities would disturb about 423 acres of land for the aboveground facilities and the pipeline. Following construction, DCG would maintain about 121 acres for permanent operation of the project's facilities; the remaining acreage would be restored and revert to former uses. About 75 percent of the proposed pipeline route parallels existing pipeline or utility rights-of-way.
The National Environmental Policy Act (NEPA) requires the Commission to take into account the environmental impacts that could result from an action whenever it considers the issuance of a Certificate of Public Convenience and Necessity. NEPA also requires us
In the EA we will discuss impacts that could occur as a result of the construction and operation of the proposed project under these general headings:
• geology and soils;
• land use;
• water resources, fisheries, and wetlands;
• vegetation and wildlife;
• endangered and threatened species;
• cultural resources;
• air quality and noise;
• public safety; and
• cumulative impacts
We will also evaluate reasonable alternatives to the proposed project or portions of the project, and make recommendations on how to lessen or avoid impacts on the various resource areas.
The EA will present our independent analysis of the issues. The EA will be available in the public record through eLibrary. Depending on the comments received during the scoping process, we may also publish and distribute the EA to the public for an allotted comment period. We will consider all comments on the EA before making our recommendations to the Commission. To ensure we have the opportunity to consider and address your comments, please carefully follow the instructions in the Public Participation section, beginning on page 2.
With this notice, we are asking agencies with jurisdiction by law and/or special expertise with respect to the environmental issues of this project to formally cooperate with us in the preparation of the EA.
In accordance with the Advisory Council on Historic Preservation's implementing regulations for Section 106 of the National Historic Preservation Act, we are using this notice to initiate consultation with the applicable State Historic Preservation Office (SHPO), and to solicit their views and those of other government agencies, interested Indian tribes, and the public on the project's potential effects on historic properties.
The environmental mailing list includes federal, state, and local government representatives and agencies; elected officials; environmental interest groups; Native American Tribes; other interested parties; and local libraries and newspapers. This list also includes all affected landowners (as defined in the Commission's regulations) who are potential right-of-way grantors, whose property may be used temporarily for project purposes, or who own homes within certain distances of aboveground facilities, and anyone who submits comments on the project. We will update the environmental mailing list as the analysis proceeds to ensure that we send the information related to this environmental review to all individuals, organizations, and government entities interested in and/or potentially affected by the proposed project.
If we publish and distribute the EA, copies will be sent to the environmental mailing list for public review and comment. If you would prefer to receive a paper copy of the document instead of the CD version or would like to remove your name from the mailing list, please return the attached Information Request (appendix 2).
In addition to involvement in the EA scoping process, you may want to become an “intervenor” which is an official party to the Commission's proceeding. Intervenors play a more formal role in the process and are able to file briefs, appear at hearings, and be heard by the courts if they choose to appeal the Commission's final ruling. An intervenor formally participates in the proceeding by filing a request to
Additional information about the project is available from the Commission's Office of External Affairs, at (866) 208-FERC, or on the FERC Web site at
In addition, the Commission offers a free service called eSubscription which allows you to keep track of all formal issuances and submittals in specific dockets. This can reduce the amount of time you spend researching proceedings by automatically providing you with notification of these filings, document summaries, and direct links to the documents. Go to
Finally, public meetings or site visits will be posted on the Commission's calendar located at
Take notice that the Commission has received the following Natural Gas Pipeline Rate and Refund Report filings:
The filings are accessible in the Commission's eLibrary system by clicking on the links or querying the docket number.
Any person desiring to intervene or protest in any of the above proceedings must file in accordance with Rules 211 and 214 of the Commission's Regulations (18 CFR 385.211 and 385.214) on or before 5:00 p.m. Eastern time on the specified comment date. Protests may be considered, but intervention is necessary to become a party to the proceeding.
eFiling is encouraged. More detailed information relating to filing requirements, interventions, protests, service, and qualifying facilities filings can be found at:
Take notice that the North American Energy Standards Board (NAESB) has announced that it will hold its first conference call on August 13, 2015, from 2:00 p.m. to 4:00 p.m. Eastern Time, to initiate its process for developing standards for the submission of Commission forms in XML format. In the Commission's April 16, 2015, Order in this proceeding, the Commission announced it was beginning a process to develop a revised method for natural gas pipelines, public utilities, and oil pipelines to file forms, and asked NAESB and the electric, natural gas, and oil industries to establish a collaborative process with Commission staff to develop standards for filing forms.
After the staff technical conference, the Commission received five comments generally supportive of moving forward with the NAESB process. NAESB has agreed to sponsor this project and the August 13, 2015 conference call is to establish procedures for moving forward. The comments also posed certain questions that should be addressed during the NAESB meetings.
NAESB has posted details regarding the conference at
Commission notices for future meetings will not be issued. The Commission will post the time and dates for future meetings on its Web site at
For more information about this conference call or the proceeding, please contact Robert Hudson, Office of Enforcement, at (202) 502-6620 or
Take notice that the Commission received the following electric rate filings:
Take notice that the Commission received the following land acquisition reports:
The filings are accessible in the Commission's eLibrary system by clicking on the links or querying the docket number.
Any person desiring to intervene or protest in any of the above proceedings must file in accordance with Rules 211 and 214 of the Commission's Regulations (18 CFR 385.211 and 385.214) on or before 5:00 p.m. Eastern time on the specified comment date. Protests may be considered, but intervention is necessary to become a party to the proceeding.
eFiling is encouraged. More detailed information relating to filing requirements, interventions, protests, service, and qualifying facilities filings can be found at:
The Federal Energy Regulatory Commission (Commission) hereby gives notice that members of the Commission's staff may attend the following meeting related to the transmission planning activities of the Midcontinent Independent System Operator, Inc. (MISO):
The above-referenced meeting will be held at: MISO Headquarters, 720 City Center Drive, Carmel, IN 46032.
Further information may be found at
The discussions at the meeting described above may address matters at issue in the following proceedings:
For more information, contact Chris Miller, Office of Energy Market Regulation, Federal Energy Regulatory Commission at (317) 249-5936 or
This is a supplemental notice in the above-referenced proceeding of Alexander Wind Farm, LLC's application for market-based rate authority, with an accompanying rate tariff, noting that such application includes a request for blanket authorization, under 18 CFR part 34, of future issuances of securities and assumptions of liability.
Any person desiring to intervene or to protest should file with the Federal Energy Regulatory Commission, 888 First Street NE., Washington, DC 20426, in accordance with Rules 211 and 214 of the Commission's Rules of Practice and Procedure (18 CFR 385.211 and 385.214). Anyone filing a motion to
Notice is hereby given that the deadline for filing protests with regard to the applicant's request for blanket authorization, under 18 CFR part 34, of future issuances of securities and assumptions of liability, is August 5, 2015.
The Commission encourages electronic submission of protests and interventions in lieu of paper, using the FERC Online links at
Persons unable to file electronically should submit an original and 5 copies of the intervention or protest to the Federal Energy Regulatory Commission, 888 First Street NE., Washington, DC 20426.
The filings in the above-referenced proceeding are accessible in the Commission's eLibrary system by clicking on the appropriate link in the above list. They are also available for electronic review in the Commission's Public Reference Room in Washington, DC. There is an eSubscription link on the Web site that enables subscribers to receive email notification when a document is added to a subscribed docket(s). For assistance with any FERC Online service, please email
Take notice that the Commission received the following electric rate filings:
The filings are accessible in the Commission's eLibrary system by clicking on the links or querying the docket number.
Any person desiring to intervene or protest in any of the above proceedings must file in accordance with Rules 211 and 214 of the Commission's Regulations (18 CFR 385.211 and 385.214) on or before 5:00 p.m. Eastern time on the specified comment date. Protests may be considered, but intervention is necessary to become a party to the proceeding.
eFiling is encouraged. More detailed information relating to filing requirements, interventions, protests, service, and qualifying facilities filings can be found at:
Environmental Protection Agency (EPA).
Notice; extension of comment period.
EPA issued a notice in the
Comments, identified by docket identification (ID) number EPA-HQ-OPP-2015-0389, must be received on or before August 24, 2015.
Follow the detailed instructions provided under
Khue Nguyen, Pesticide Re-Evaluation Division (7508P), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave. NW., Washington, DC 20460-0001; telephone number: (703) 347-0248; email address:
This notice extends the public comment period established in the
To submit comments, or access the docket, please follow the detailed instructions provided under
7 U.S.C. 136
Environmental Protection Agency (EPA).
Notice.
EPA is announcing its receipt of test data submitted pursuant to a test rule issued by EPA under the Toxic Substances Control Act (TSCA). As required by TSCA, this document identifies each chemical substance and/or mixture for which test data have been received; the uses or intended uses of such chemical substance and/or mixture; and describes the nature of the test data received. Each chemical substance and/or mixture related to this announcement is identified in Unit I. under
Information about the following chemical substances and/or mixtures is provided in Unit IV.:
Section 4(d) of TSCA (15 U.S.C. 2603(d)) requires EPA to publish a notice in the
A docket, identified by the docket identification (ID) number EPA-HQ-OPPT-2013-0677, has been established for this
The docket for this
This unit contains the information required by TSCA section 4(d) for the test data received by EPA.
1.
2.
3.
15 U.S.C. 2601
Federal Communications Commission.
Notice and request for comments.
As part of its continuing effort to reduce paperwork burden and as required by the Paperwork Reduction Act (PRA) of 1995 (44 U.S.C. 3501-3520), the Federal Communications Commission invites the general public and other Federal agencies to take this opportunity to comment on the following information collection(s). Comments are requested concerning: Whether the proposed collection of information is necessary for the proper performance of the functions of the Commission, including whether the information shall have practical utility; the accuracy of the Commission's burden estimate; ways to enhance the quality, utility, and clarity of the information collected; ways to minimize the burden of the collection of information on the respondents, including the use of automated collection techniques or other forms of information technology; and ways to further reduce the information burden for small business concerns with fewer than 25 employees. The FCC may not conduct or sponsor a collection of information unless it displays a currently valid OMB control number. No person shall be subject to any penalty for failing to comply with a collection of information subject to the Paperwork Reduction Act (PRA) that does not display a valid OMB control number.
Written PRA comments should be submitted on or before September 21, 2015. If you anticipate that you will be submitting comments, but find it difficult to do so within the period of time allowed by this notice, you should advise the contact listed below as soon as possible.
Direct all PRA comments to Cathy Williams, FCC, via email
For additional information about the information collection, contact Cathy Williams at (202) 418-2918.
The Federal Communications Commission (“Commission”) plans to implement and release to the public an “Application for Renewal of an International Broadcast Station License (FCC Form 422-IB).” The form has not been implemented yet due to a lack of budget resources and technical staff. After the FCC Form 422-IB has been implemented and the Commission receives final approval from OMB, applicants will complete the FCC Form 422-IB in lieu of the “Application for Renewal of an International or Experimental Broadcast Station License,” (FCC Form 311). In the interim, applicants will continue to file the FCC Form 311 with the Commission. (Note: The OMB approved the FCC Form 311 under OMB Control No. 3060-1035).
The Commission stated previously that the FCC Form 422-IB will be available to applicants in the International Bureau Filing System (“IBFS”) after it is implemented. However, the Commission plans to develop a new licensing system within the next five years that will replace IBFS. Therefore, the FCC Form 422-IB will be made available to the public in CLS instead of IBFS.
The information collected pursuant to the rules set forth in 47 CFR part 73, subpart F, is used by the Commission to assign frequencies for use by international broadcast stations, to grant authority to operate such stations and to determine if interference or adverse propagation conditions exist that may impact the operation of such stations. If the Commission did not collect this information, it would not be in a position to effectively coordinate spectrum for international broadcasters or to act for entities in times of frequency interference or adverse propagation conditions. The orderly nature of the provision of international broadcast service would be in jeopardy without the Commission's involvement.
Federal Communications Commission.
Notice and request for comments.
As part of its continuing effort to reduce paperwork burdens, and as required by the Paperwork Reduction Act (PRA) of 1995 (44 U.S.C. 3501-3520), the Federal Communications Commission (FCC or Commission) invites the general public and other Federal agencies to take this opportunity to comment on the following information collections. Comments are requested concerning: Whether the proposed collection of information is necessary for the proper performance of the functions of the Commission, including whether the information shall have practical utility; the accuracy of the Commission's burden estimate; ways to enhance the quality, utility, and clarity of the information collected; ways to minimize the burden of the collection of information on the respondents, including the use of automated
The FCC may not conduct or sponsor a collection of information unless it displays a currently valid OMB control number. No person shall be subject to any penalty for failing to comply with a collection of information subject to the PRA that does not display a valid OMB control number.
Written comments should be submitted on or before August 21, 2015. If you anticipate that you will be submitting comments, but find it difficult to do so within the period of time allowed by this notice, you should advise the contacts below as soon as possible.
Direct all PRA comments to Nicholas A. Fraser, OMB, via email
For additional information or copies of the information collection, contact Cathy Williams at (202) 418-2918. To view a copy of this information collection request (ICR) submitted to OMB: (1) Go to the Web page <
On April 27, 2012, the Commission released the Empowering Consumers to Prevent and Detect Billing for Unauthorized Charges (“Cramming”), Report and Order and Further Notice of Proposed Rulemaking, CG Docket No. 11-116, CG Docket No. 09-158, CC Docket No. 98-170, FCC 12-42 (Cramming Report and Order and Further Notice of Proposed Rulemaking); published at 77 FR 30972, May 24, 2012, which determined that additional rules are needed to help consumers prevent and detect the placement of unauthorized charges on their telephone bills, an unlawful and fraudulent practice commonly referred to as “cramming.”
Federal Communications Commission.
Notice and request for comments.
As part of its continuing effort to reduce paperwork burdens, and as required by the Paperwork Reduction Act (PRA) of 1995 (44 U.S.C. 3501-3520), the Federal Communications Commission (FCC or the Commission) invites the general public and other Federal agencies to take this opportunity to comment on the following information collection. Comments are requested concerning: Whether the proposed collection of information is necessary for the proper performance of the functions of the Commission, including whether the information shall have practical utility; the accuracy of the Commission's burden estimate; ways to enhance the quality, utility, and clarity of the information collected; ways to minimize the burden of the collection of information on the respondents, including the use of automated collection techniques or other forms of information technology; and ways to further reduce the information
Written PRA comments should be submitted on or before September 21, 2015. If you anticipate that you will be submitting comments, but find it difficult to do so within the period of time allowed by this notice, you should advise the contact listed below as soon as possible.
Direct all PRA comments to Nicole Ongele, FCC, via email
For additional information about the information collection, contact Nicole Ongele at (202) 418-2991.
Federal Maritime Commission.
Notice.
The Federal Maritime Commission is publishing an updated list of controlled carriers,
Tyler J. Wood, General Counsel, Federal Maritime Commission, 800 North Capitol Street NW., Washington, DC 20573, (202) 523-5740.
The Federal Maritime Commission is publishing an updated list of controlled carriers. Section 3(8) of the Shipping Act of 1984 (46 U.S.C. 40102(8)), defines a “controlled carrier” as an ocean common carrier that is, or whose operating assets are, directly or indirectly, owned or controlled by a government, with ownership or control by a government being described in the statute.
As required by the Shipping Act, controlled carriers are subject to special oversight by the Commission. Section 9(a) of the Shipping Act (46 U.S.C. 40701(b)), states that the Commission, at any time after notice and opportunity for a hearing, may prohibit the publication or use of a rate, charge, classification, rule, or regulation that a controlled carrier has failed to demonstrate is just and reasonable.
Congress enacted these protections to ensure that controlled carries, whose marketplace decision-making can be influenced by foreign governmental priorities or by their access to non-market sources of capital, do not engage in unreasonable below-market pricing practices which could disrupt trade or harm privately-owned shipping companies.
The controlled carrier list is not a comprehensive list of foreign-owned or -controlled ships or ship owners; rather, it is only a list of ocean common carriers that are controlled by governments.
Since the last publication of this list on August 22, 2012 (77 FR 51801), the Commission has newly classified two ocean common carriers as controlled carriers, CNAN Nord SPA (“CNAN”) and United Arab Shipping Company (S.A.G.) (“UASC”).
Pursuant to 46 CFR 501.23, CNAN was classified as a controlled carrier on September 23, 2014.
Pursuant to 46 CFR 501.23 and 565.4, UASC notified the Commission of its change in majority ownership by the State of Qatar on June 18, 2014, and after review, the Commission classified UASC as a controlled carrier on July 6, 2015.
It is requested that any other information regarding possible omissions or inaccuracies in this list be provided to the Commission's Office of General Counsel.
(1) American President Lines, Ltd. and APL Co. Pte. Ltd. (RPI No. 000240)—Republic of Singapore;
(2) COSCO Container Lines Company, Limited (RPI No. 015614)—People's Republic of China;
(3) China Shipping Container Lines Co., Ltd and China Shipping Container Lines (Hong Kong) Co., Limited (RPI No. 019270)—People's Republic of China;
(4) Hainan P O Shipping Co., Ltd. (RPI No. 022860)—People's Republic of China;
(5) CNAN Nord SPA (RPI No. 021980)—People's Democratic Republic of Algeria;
(6) United Arab Shipping Company (S.A.G.) (RPI No. 006256)—State of Qatar.
The Commission hereby gives notice of the filing of the following agreements under the Shipping Act of 1984. Interested parties may submit comments on the agreements to the Secretary, Federal Maritime Commission, Washington, DC 20573, within twelve days of the date this notice appears in the
By Order of the Federal Maritime Commission.
Federal Maritime Commission.
Notice; correction.
The date for submission of comments by interested parties is extended to fifteen (15) days after publication of this correction in the
The Federal Maritime Commission published a document in the
Karen V. Gregory, 202-523-5725.
In the
Federal Retirement Thrift Investment Board.
Notice of retirement of systems of records, revision of routine uses, revision of purpose and routine uses, technical revisions to systems of records, and establishment of new systems of records.
Pursuant to the Privacy Act of 1974, 5 U.S.C. 552a, the Federal Retirement Thrift Investment Board (FRTIB) is proposing to: (1) Retire five systems of records; (2) create new general routine uses; (3) revise the purpose and routine uses of four existing systems of records; and (4) establish two new systems of records. The revisions implemented under this republication are corrective and administrative changes that refine and streamline previously published system of records notices.
Comments must be received on or before August 21, 2015 unless comments received on or before that date result in a contrary determination.
You may submit written comments to FRTIB by any one of the following methods:
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Marla Greenberg, Chief Privacy Officer, Federal Retirement Thrift Investment Board, Office of General Counsel, 77 K Street NE., Suite 1000, Washington, DC 20002, 202-864-8612. For access to any of the FRTIB's systems of records, contact Amanda Haas, FOIA Officer, Office of General Counsel, at the above address or by calling (202) 637-1250.
Pursuant the Privacy Act of 1974, 5 U.S.C. 552a, and as part of its ongoing integration efforts, the Federal Retirement Thrift Investment Board is retiring the following five systems of records notices: FRTIB-3, Equal Employment Opportunities Records (last published at 77 FR 11534 (February 27, 2012)); FRTIB-4, Adverse Information and Action Records: Disciplinary Records (last published 77 FR 11534 (February 27, 2012)); FRTIB-6, Leave Records (last published at FR (DATE)); FRTIB-10, Identity Management System (IDMS) (last published 77 FR 11534 (February 27, 2012)); and FRTIB-11, Financial Disclosure Reports and Outside Business Interest Records (last published at 77 FR 11534 (February 27, 2012)).
With regard to FRTIB-3, FRTIB will continue to collect and maintain records compiled during the pre-complaint counseling and the investigation of complaints under the Equal Employment Opportunity Act and will rely upon the existing Federal Government-wide system of records titled EEOC/GOVT-1 (Equal Employment Opportunity in the Federal Government Complaint and Appeal Records (67 FR 49338, July 30, 2002), which is written to cover all federal government EEO complaint and appeals records.
With regard to FRTIB-4, FRTIB will continue to collect and maintain personnel records and will rely upon the existing federal government-wide systems of records titled OPM/GOVT-1, General Personnel Records (71 FR 35342 June 19, 2006); OPM/GOVT-2, Employee Performance File System of Records (71 FR 35347 June 19, 2006); and OPM/GOVT-3, Records of Adverse Actions, Performance Based Reduction in Grade and Removal Actions and Termination of Probationers (71 FR 35350 June 19, 2006) which are written to cover all general federal government personnel records.
With regard to FRTIB-6, FRTIB will continue to collect and maintain employee leave records and will rely on FRTIB-5, Employee Payroll, Leave, and Attendance Records, as revised herein.
With regard to FRTIB-10, FRTIB will continue to collect and maintain records pertaining to the Personal Identity Verification (PIV) and Identity Management System (IDMS) and will rely upon the existing government-wide system of records titled GSA/GOVT-7 Personal Identity Verification Identity Management System (73 FR 22377 April 25, 2008) which is written to cover all PIV/IDMS records of participating agencies.
With regard to FRTIB-11, FRTIB will continue to collect and maintain Public and Confidential Financial Disclosure Reports and other ethics program records and will rely upon the existing government-wide systems of records entitled OGE/GOVT-1, Executive Branch Personnel Public Financial Disclosure Reports and Other Name-Retrieved Ethics Program Records (68 FR 24722 May 8, 2003) and OGE/GOVT-2, Executive Branch Confidential Financial Disclosure Reports (68 FR 24722 May 8, 2003) which are written to cover all federal government financial disclosure reports and other ethics program records.
Eliminating these notices will have no adverse impacts on individuals, but will promote the overall streamlining and management of FRTIB's Privacy Act record systems.
The following routine uses are incorporated by reference into various systems of records, as set forth below.
G1. Routine Use—Audit: A record from this system of records may be disclosed to an agency, organization, or individual for the purpose of performing an audit or oversight operations as authorized by law, but only such information as is necessary and relevant to such audit or oversight function when necessary to accomplish an agency function related to this system of records. Individuals provided information under this routine use are subject to the same Privacy Act requirements and limitations on disclosure as are applicable to FRTIB officers and employees.
G2. Routine Use—Breach Mitigation and Notification: A record from this system of records may be disclosed to appropriate agencies, entities, and persons when: (1) FRTIB suspects or has confirmed that the security or confidentiality of information in the system of records has been compromised; (2) FRTIB has determined that as a result of the suspected or confirmed compromise there is a risk of harm to economic or property interests, identity theft or fraud, or harm to the security or integrity of this system or other systems or programs (whether maintained by FRTIB or another agency or entity) that rely upon the compromised information; and (3) the disclosure made to such agencies, entities, and persons is reasonably necessary to assist in connection with the FRTIB's efforts to respond to the suspected or confirmed compromise and prevent, minimize, or remedy such harm.
G3. Routine Use—Clearance Processing: A record from this system of records may be disclosed to an appropriate federal, state, local, tribal, foreign, or international agency, if the information is relevant and necessary to a requesting agency's decision concerning the hiring or retention of an individual, or issuance of a security clearance, background investigation, license, contract, grant, or other benefit, or if the information is relevant and necessary to a FRTIB decision concerning the hiring or retention of an employee, the issuance of a security clearance, the reporting of an investigation of an employee, the letting of a contract, or the issuance of a license, grant or other benefit and when disclosure is appropriate to the proper performance of the official duties of the person making the request.
G4. Routine Use—Congressional Inquiries: A record from this system of records may be disclosed to a Congressional office from the record of an individual in response to an inquiry from that Congressional office made at the request of the individual to whom the record pertains.
G5. Routine Use—Contractors,
G6. Routine Use—Debt Collection: A record from this system of records may be disclosed to the Department of Justice, the Department of Treasury, or to a consumer reporting agency for collection action on any delinquent debt, pursuant to 5 U.S.C. 552a(b)(12).
G7. Routine Use—Former Employees: A record from this system of records may be disclosed to a former employee of the FRTIB, in accordance with applicable regulations, for purposes of responding to an official inquiry by a federal, state, or local government entity or professional licensing authority; or facilitating communications with a former employee that may be necessary for personnel-related or other official
G8. Routine Use—Investigations, Third Parties: A record from this system of records may be disclosed to third parties during the course of a law enforcement investigation to the extent necessary to obtain information pertinent to the investigation, provided disclosure is appropriate to the proper performance of the official duties of the third party officer making the disclosure.
G9. Routine Use—Investigations, Other Agencies: A record from this system of records may be disclosed to appropriate federal, state, local, tribal, or foreign government agencies or multilateral governmental organizations for the purpose of investigating or prosecuting the violations of, or for enforcing or implementing, a statute, rule, regulation, order, license, or treaty where FRTIB determines that the information would assist in the enforcement of civil or criminal laws.
G10. Routine Use—Law Enforcement Intelligence: A record from this system of records may be disclosed to a federal, state, tribal, local, or foreign government agency or organization, or international organization, lawfully engaged in collecting law enforcement intelligence information, whether civil or criminal, or charged with investigating, prosecuting, enforcing or implementing civil or criminal laws, related rules, regulations or orders, to enable these entities to carry out their law enforcement responsibilities, including the collection of law enforcement intelligence.
G11. Routine Use—Law Enforcement Referrals: A record from this system of records may be disclosed to an appropriate federal, state, tribal, local, international, or foreign agency or other appropriate authority charged with investigating or prosecuting a violation or enforcing or implementing a law, rule, regulation, or order, where a record, either on its face or in conjunction with other information, indicates a violation or potential violation of law, which includes criminal, civil, or regulatory violations and such disclosure is proper and consistent with the official duties of the person making the disclosure.
G12. Routine Use—Litigation, DOJ or Outside Counsel: A record from this system of records may be disclosed to the Department of Justice, FRTIB's outside counsel, other federal agency conducting litigation or in proceedings before any court, adjudicative or administrative body, when: (1) FRTIB, or (b) any employee of FRTIB in his or her official capacity, or (c) any employee of FRTIB in his or her individual capacity where DOJ or FRTIB has agreed to represent the employee, or (d) the United States or any agency thereof, is a party to the litigation or has an interest in such litigation, and FRTIB determines that the records are both relevant and necessary to the litigation and the use of such records is compatible with the purpose for which FRTIB collected the records.
G13. Routine Use—Litigation, Opposing Counsel: A record from this system of records may be disclosed to a court, magistrate, or administrative tribunal in the course of presenting evidence, including disclosures to opposing counsel or witnesses in the course of civil discovery, litigation, or settlement negotiations or in connection with criminal law proceedings or in response to a subpoena.
G14. Routine Use—NARA/Records Management: A record from this system of records may be disclosed to the National Archives and Records Administration (NARA) or other federal government agencies pursuant to the Federal Records Act.
G15. Routine Use—Redress: A record from this system of records may be disclosed to a federal, state, tribal, local, international, or foreign government agency or entity for the purpose of consulting with that agency or entity: (1) To assist in making a determination regarding redress for an individual in connection with the operations of a FRTIB program; (2) for the purpose of verifying the identity of an individual seeking redress in connection with the operations of a FRTIB program; or (3) for the purpose of verifying the accuracy of information submitted by an individual who has requested such redress on behalf of another individual.
G16. Routine Use—Security Threat: A record from this system of records may be disclosed to federal and foreign government intelligence or counterterrorism agencies when FRTIB reasonably believes there to be a threat or potential threat to national or international security for which the information may be useful in countering the threat or potential threat, when FRTIB reasonably believes such use is to assist in anti-terrorism efforts, and disclosure is appropriate to the proper performance of the official duties of the person making the disclosure.
G17. Routine Use—Testing: A record from this system of records may be disclosed to appropriate federal, state, local, tribal, or foreign governmental agencies or multilateral governmental organizations where FRTIB is aware of a need to utilize relevant data for purposes of testing new technology and systems designed to enhance security or identify other violations of law.
FRTIB is proposing to revise the purpose of and routine uses to FRTIB-2, Personnel Security Investigation Files (last published at 77 FR 11534 (February 27, 2012)). The existing purpose focuses on documenting and supporting decisions regarding access to FRTIB information and using it to process suitability, eligibility, and fitness for duty determinations. FRTIB is proposing to add the following sentence to the purpose: “The records may also be used to help streamline and make more efficient the investigations and adjudications process generally.” FRTIB is also proposing minor technical amendments to the purpose of the system to reflect the fact that the system of records deals with sensitive FRTIB information.
FRTIB is also proposing to reorder the routine uses for FRTIB-2, Personnel Security Investigation Files (this change is being made to all existing systems of records to the extent necessary to make all of FRTIB's notices uniform and to reflect the addition of FRTIB's proposed general routine uses). FRTIB is proposing to add fifteen general routine uses to apply to FRTIB-2, including G1 through G5; G7 through G9; and G11 through G17.
FRTIB is proposing to correct and update the system name; security classification; system location; categories of individuals covered by the system; categories of records in the system; authority for maintenance of the system; purpose; routine uses; disclosure to consumer reporting agencies; storage; retrievability; safeguards; retention and disposal; system manager and address; notification procedure; record access procedures; contesting records procedures; record source categories; and exemptions claimed for the system. Although FRTIB is proposing changes to the exemptions claimed for FRTIB-2, Personnel Security Investigation Files, the exemption itself will not change; rather, these changes are clarifying in nature.
FRTIB is proposing to revise the purpose of and routine uses to FRTIB-5, Employee Payroll, Leave, and Attendance Records (last published at 77 FR 11534 (February 27, 2012)). The existing purpose focuses on FRTIB's payroll records. FRTIB is proposing to expand the purpose to include records concerning “leave, attendance, and payments, including determinations relating the amounts to be paid to employees, the distribution of pay according to employee direction (for allotments, to financial institutions, and for other authorized purposes), and for tax withholdings and other authorized deductions.”
FRTIB is also proposing to reorder the routine uses for FRTIB-5, Employee Attendance, Payroll, and Leave Records (this change is being made to all existing systems of records to the extent necessary to make all of FRTIB's notices uniform and to reflect the addition of FRTIB's proposed general routine uses). FRTIB is proposing to add two system-specific routine uses and sixteen general routine uses to apply to FRTIB-5, including G1 through G16.
FRTIB is proposing to correct and update the system name; security classification; system location; categories of individuals covered by the system; categories of records in the system; authority for maintenance of the system; purpose; routine uses; disclosure to consumer reporting agencies; storage; retrievability; safeguards; retention and disposal; system manager and address; notification procedure; record access procedures; contesting records procedures; record source categories; and exemptions claimed for the system.
FRTIB is proposing to revise the purpose of and routine uses to FRTIB-9, Emergency Notification Records (last published at 77 FR 11534 (February 27, 2012)). The existing purpose focused on the location and notification of individuals during emergencies, as well as the creation of social rosters. FRTIB is proposing to remove reference to social rosters and to enable the Agency to use this information for business continuity purposes.
FRTIB is proposing to reorder the routine uses for FRTIB-9, Emergency Notification Records (this change is being made to all existing systems of records to the extent necessary to make all of FRTIB's notices uniform and to reflect the addition of FRTIB's proposed general routine uses). FRTIB is also proposing to add fourteen general routine uses to apply to FRTIB-9, including G1 through G2; G4 through G5; G7 through G9; and G11 through G17.
FRTIB is proposing to correct and update the system name; security classification; system location; categories of individuals covered by the system; categories of records in the system; authority for maintenance of the system; purpose; routine uses; storage; retrievability; safeguards; system manager and address; notification procedure; record access procedures; and contesting records procedures. Although FRTIB is proposing changes to the exemptions claimed for FRTIB-9, Emergency Notification Records, the exemption itself will not change; rather, these changes are clarifying in nature.
FRTIB is proposing to revise the purpose of and routine uses to FRTIB-13, Fraud and Forgery Records (last published at 77 FR 11534 (February 27, 2012)). The existing purpose narrowly applied to records pertaining to fraud and forgery participants committed or alleged to have committed against their own accounts. FRTIB is proposing to broaden the scope of this system of records to include records pertaining to fraud or forgery committed by participants, beneficiaries, and third parties affecting a participant account. Moreover, FRTIB is proposing to expand the scope of this system to include records relating to third parties alleged to have misappropriated or to have attempted to misappropriate the Agency's name, brand, or logo.
FRTIB is also proposing to reorder the routine uses for FRTIB-13, Fraud and Forgery Records (this change is being made to all existing systems of records to the extent necessary to make all of FRTIB's notices uniform and to reflect the addition of FRTIB's proposed general routine uses). FRTIB is proposing to add twelve general routine uses to apply to FRTIB-13, including G1 through G2; G4 through G5; G8 through G14; and G16.
FRTIB is proposing to correct and update the security classification; system location; categories of individuals covered by the system; categories of records in the system; purpose; routine uses; disclosure to consumer reporting agencies; storage; retrievability; safeguards; system manager and address; notification procedure; record access procedures; contesting records procedures; record source categories; and exemptions claimed for the system. Although FRTIB is proposing changes to the exemptions claimed for FRTIB-13, Fraud and Forgery Records, the exemption itself will not change; rather, these changes are clarifying in nature.
FRTIB is proposing to establish a new system of records entitled, FRTIB-14, Legal Case Files.” The proposed system of records is necessary to assist FRTIB attorneys in providing legal advice to FRTIB personnel on a wide variety of legal issues; to collect and maintain information of any individual who is or will be in litigation with the Agency; to represent FRTIB during litigation; and to catalogue, investigate, litigate, or otherwise resolve any case or matter handled by the Office of General Counsel.
These files may include: Notes, reports, legal opinions and memoranda; settlements; agreements; documentary evidence; claims and records regarding discrimination; correspondence; contracts; contract proposals and other procurement documents; TSP documents; participant, beneficiary, and alternate payee files; initial and final FRTIB determinations of FERSA matters; Freedom of Information Act and Privacy Act requests and appeals, and decisions of those requests and appeals; drafts and legal reviews of proposed personnel actions; personnel records; litigation files; employee relations files; witness statements; summonses and subpoenas; affidavits; court transcripts; discovery requests and responses; and breach reports and supporting documents. FRTIB is proposing to add four system-specific routine uses and sixteen general routine uses to apply to FRTIB-14, including G1 through G16.
FRTIB is proposing to establish a new system of record entitled, “FRTIB-15, Internal Investigations of Harassment and Hostile Work Environment Allegations.” The proposed system of records is necessary for the purpose of upholding FRTIB's policy to provide for a work environment free from all forms of harassment and will cover files that identify by name, or other personal identifier, individuals who have asserted that they have been subjected to harassment or hostile work environment at FRTIB, as well as
These files may include: The name, position, grade, and supervisor(s) of the complainant and the accused; the complaint; witness statements; interview notes; legal memoranda; reports of investigation; final decisions and corrective actions taken; and related correspondence and exhibits. FRTIB is proposing to add one system-specific routine use and sixteen general routine uses to apply to FRTIB-15, including G1 through G16.
Pursuant to 5 U.S.C. 552a(e)(11), interested persons are invited to submit written comments on the proposal of these two systems of records. A report on the proposed systems has been sent to Congress and the Office of Management and Budget for their awareness.
Personnel Security Investigation Files.
Most personnel identity verification records are not classified. However, in some cases, records of certain individuals, or portions of some records may be classified in the interest of national security.
Federal Retirement Thrift Investment Board, 77 K Street NE., Suite 1000, Washington, DC 20002. Records may also be kept at an additional location as backup for Business Continuity purposes. For background investigations adjudicated by the Office of Personnel Management (OPM), OPM may retain copies of those files pursuant to OPM/Central-9, Personnel Investigations Records.
Individuals who require regular, ongoing access to FRTIB facilities, information technology systems, or sensitive information, including current and former applicants for employment or contracts, federal employees, government contractors, students, interns, volunteers, affiliates, experts, instructors, and consultants to federal programs who undergo a background investigation for the purposes of determining suitability for employment, contractor fitness, credentialing for HSPD-12, and/or access to FRTIB facilities or information technology systems. This system also includes individuals accused of security violations or found in violation of FRTIB's security policies.
Name; former names; date and place of birth; Social Security number; home address; email address(es); phone numbers; employment history; residential history; education and degrees earned; citizenship; passport information; names, date and place of birth, Social Security number, and citizenship information for spouse or cohabitant; the name and marriage information for current and former spouse(s); names of associates and references and their contact information; names, dates and places of birth, citizenship, and address of relatives; names of relatives who work for the federal government; information on foreign contacts and activities; association records; information on loyalty to the United States; criminal history; mental health history; information pertaining to drug use; financial information; fingerprints; information from the Internal Revenue Service pertaining to income tax returns; credit reports; information pertaining to security clearances; other agency reports furnished to FRTIB in connection with the background investigation process; summaries of personal and third party interviews conducted during the background investigation; results of suitability decisions; level of security clearance; date of issuance of security clearance; including, but not limited to forms such as SF-85, SF-85P, SF-86, SF-87, SF-306; FD-258; and other information generated from above, where applicable.
Records pertaining to security violations may contain information pertaining to circumstances of the violation; witness statements, investigator's notes, security violations; agency action taken; requests for appeal; and documentation of agency action taken in response to security violations.
5 U.S.C. 3301; 44 U.S.C. 3101; Executive Order 10450; Executive Order 13488; 5 CFR 731 and 736; 61 FR 6428; and Homeland Security Presidential Directive 12.
The records in this system of records are used to document and support decisions regarding clearance for access to sensitive FRTIB information, the ability to receive and the suitability, eligibility, and fitness for service of applicants for federal employment and contract positions, including students, interns, or volunteers to the extent their duties require access to federal facilities, information systems, or applications. The records may also be used to help streamline and make more efficient the investigations and adjudications process generally. The records may
Information about covered individuals may be disclosed without consent as permitted by the Privacy Act of 1974, as amended, 5 U.S.C. 552a(b); and:
1. General Routine Uses G1 through G5; G7 through G9; G7 through G9; and G11 through G16 apply to this system of records (see Prefatory Statement of General Routine Uses).
2. A record from this system of records may be disclosed to any authorized source or potential source from which information is requested in the course of an investigation concerning the retention of an employee or other personnel action (other than hiring), or the retention of a security clearance, contact, grant, license, or other benefit, to the extent necessary to identify the individual,
3. A record from this system of records may be disclosed to OPM, the Merit Systems Protection Board, the Federal Labor Relations Authority, the Office of Special Counsel, or the Equal Employment Opportunity Commission to carry out its respective authorized functions (under 5 U.S.C. 1103, 1204, and 7105 and 42 U.S.C. 2000e-4, in that order).
4. To the Office of Management and Budget when necessary to the review of private relief legislation pursuant to OMB Circular No. A-19.
5. A record from this system of records may be disclosed to a Federal, State, local, foreign, or tribal or other public authority the fact that this system of records contains information relevant to the retention of an employee, the retention of a security clearance, the letting of a contract, or the issuance or retention of a license, grant, or other benefit. The other agency or licensing organization may then make a request supported by the written consent of the individual for the entire record if it so chooses. No disclosure will be made unless the information has been determined to be sufficiently reliable to
6. A record from this system of records may be disclosed to the news media or the general public, factual information the disclosure of which would be in the public interest and which would not constitute an unwarranted invasion of personal privacy, consistent with Freedom of Information Act standards.
7. A record from this system of records may be disclosed to a Federal, State, or local agency, or other appropriate entities or individuals, or through established liaison channels to selected foreign governments, in order to enable an intelligence agency to carry out its responsibilities under the National Security Act of 1947 as amended, the CIA Act of 1949 as amended, Executive Order 12333 or any successor order, applicable national security directives, or classified implementing procedures approved by the Attorney General and promulgated pursuant to such statutes, orders or directives.
None.
Records are maintained in paper and electronic form, including on computer databases, all of which are stored in a secure location.
Background investigation files are retrieved by any one or more of the following identifiers: Name; Social Security number; or other unique identifier of the individual about whom they are maintained.
FRTIB has adopted appropriate administrative, technical, and physical controls in accordance with FRTIB's security program to protect the security, confidentiality, availability, and integrity of the information, and to ensure that records are not disclosed to or accessed by unauthorized individuals.
Paper records are stored in locked file cabinets in areas of restricted access that are locked after office hours. Electronic records are stored on computer networks and protected by assigning usernames to individuals needing access to the records and by passwords set by unauthorized users that must be changed periodically.
These records are retained and disposed of in accordance with General Records Schedule 18, item 22a, approved by the National Archives and Records Administration (NARA). The records are disposed in accordance with FRTIB disposal policies which call for burning or shredding or deleting from the Agency's electronic record keeping systems. Records are destroyed upon notification of death or not later than five years after separation or transfer of employee to another agency or department, whichever is applicable.
Personnel Security Specialist, 77 K Street NE., Suite 1000, Washington, DC 20002.
Individuals seeking to determine whether this system of records contains information about themselves should submit a written request to the appropriate entity below, and include the following information:
a. Full name;
b. Any available information regarding the type of record involved;
c. The address to which the record information should be sent; and
d. You must sign your request.
1. For records maintained by FRTIB, submit a written request to the FOIA Officer, FRTIB, 77 K Street NE., Washington, DC 20002; or
2. For records maintained by the Office of Personnel Management, submit a written request to the FOI/PA, Office of Personnel Management, Federal Investigative Services, P.O. Box 618, 1137 Branchton Road, Boyers, PA 16018-0618.
Attorneys or other persons acting on behalf of an individual must provide written authorization from that individual, such as a Power of Attorney, in order for the representative to act on their behalf. Individuals requesting access must also comply with FRTIB's Privacy Act regulations regarding verification of identity and access to such records, available at 5 CFR part 1630.
Same as Notification Procedures.
Same as Notification Procedures.
Information is obtained from a variety of sources including the employee, contractor, or applicant via use of the SF-85, SF-85P, SF-86 SF-306, or SF-87, personal interviews with various individuals, including, but not limited to the subject of the investigation, witnesses, present and former employers, references, neighbors, friends, co-workers, business associates, teachers, landlords, family members, or other associates who may have information about the subject of the investigation; investigative records and notices of personnel actions furnished by other federal agencies; records from employers and former employers; public records, such as court filings; publications such as newspapers, magazines, and periodicals; FBI criminal history records and other databases; police departments; probation officials; prison officials financial institutions and credit reports; tax records; medical records and health care providers; and educational institutions. Security violation information is obtained from a variety of sources, such as guard reports, security inspections, witnesses, supervisor's reports, audit reports.
Pursuant to 5 U.S.C. 552a(k)(2), records in this system of records are exempt from the requirements of subsections (c)(3); (d); (e)(1); (e)(4)(G), (H), (I); and (f) of 5 U.S.C. 552a. provided, however, that if any individual is denied any right, privilege, or benefit that he or she would otherwise be entitled to by federal law, or for which he or she would otherwise be eligible, as a result of the maintenance of these records, such material shall be provided to the individual, except to the extent that the disclosure of the material would reveal the identity of a source who furnished information to the Government with an express promise that the identity of the source would be held in confidence.
Pursuant to 5 U.S.C. 552a(k)(5), records in this system of records are exempt from the requirements of subsections (c)(3); (d); (e)(1); (e)(4)(G), (H), (I); and (f) of 5 U.S.C. 552a, but only to the extent that the disclosure of such material would reveal the identity of a source who furnished information to the Government under an express promise that the identity of the source would be held in confidence.
Employee Payroll, Leave, and Attendance Records.
None.
Records are located at the Federal Retirement Thrift Investment Board, 77 K Street NE., Suite 1000, Washington, DC 20002. Records may also be maintained at additional locations for Business Continuity purposes.
Current and former FRTIB employees, including Special Government Employees
This system of records includes personnel information including, names, addresses, Social Security numbers, employee numbers, gender, race or national origin, and disability data; duty location; position data; awards and bonus information; employment verification information; notifications of personnel actions; and military and veterans data.
This system of records also includes payroll information, including: Marital status and number of dependents; child support enforcement court orders; information about taxes and other deductions; debts owed to the FRTIB and garnishment information; salary data; retirement data; Thrift Savings Plan contribution and loan amount; and direct deposit information, including financial institution.
This system of records also includes time and attendance records including, the number and type of hours worked; overtime information, including compensatory or credit time earned and used; compensatory travel earned; investigative case title and tracking number (used to track time worked associated with a specific case); Fair Labor Standards Act (FLSA) compensation; leave requests, balances, and credits; leave charge codes; military leave; and medical records as they pertain to employee medical leave.
5 U.S.C. 8474; and 44 U.S.C. 3101.
This system of records is maintained to perform agency functions involving employee leave, attendance, and payments, including determinations relating to the amounts to be paid to employees, the distribution of pay according to employee directions (for allotments, to financial institutions, and for other authorized purposes), and for tax withholdings and other authorized deductions.
Information about covered individuals may be disclosed without consent as permitted by the Privacy Act of 1974, 5 U.S.C. 552a(b), and:
a. General Routine Uses G1 through G16 apply to this system of records (see Prefatory Statement of General Routine Uses).
b. A record from this system may be disclosed to the United States Department of the Interior, the United States Department of Labor, and the United States Department of the Treasury to effect payments to employees.
c. Payments owed to FRTIB through current and former employees may be shared with the Department of the Interior for the purposes of offsetting the employee's salary. Payments owed to FRTIB through current and former employees who become delinquent in repaying the necessary funds may be shared with the Department of Treasury for the purpose of offsetting the employee's salary.
None.
Records are maintained in paper and electronic form, including on computer databases, all of which are stored in a secure location.
Records are retrieved by name; or Social Security number.
FRTIB has adopted appropriate administrative, technical, and physical controls in accordance with FRTIB's security program to protect the security, confidentiality, availability, and integrity of the information, and to ensure that records are not disclosed to or accessed by unauthorized individuals.
Paper records are stored in locked file cabinets in areas of restricted access that are locked after office hours. Electronic records are stored on computer networks and protected by assigning usernames to individuals needing access to the records and by passwords set by unauthorized users that must be changed periodically.
Records are maintained in accordance with the General Records Schedules issued by the National Archives and Records Administration (NARA) or an FRTIB records disposition schedule.
For payroll records, FRTIB's Human Resources Officer, 77 K Street NE., Suite 1000, Washington, DC 20002.
For leave and attendance records, FRTIB's Administrative Officer, 77 K Street NE., Suite 1000, Washington, DC 20002.
Individuals seeking to determine whether this system of records contains information about themselves must submit a written request to the FOIA Officer, FRTIB, 77 K Street NE., Washington, DC 20002, and provide the following information:
b. Full name;
c. Any available information regarding the type of record involved;
d. The address to which the record information should be sent; and
e. Your signature.
Attorneys or other persons acting on behalf of an individual must provide written authorization from that individual, such as a Power of Attorney, in order for the representative to act on their behalf. Individuals requesting access must also comply with FRTIB's Privacy Act regulations regarding verification of identity and access to such records, available at 5 CFR part 1630.
Same as Notification Procedures.
Same as Notification Procedures.
Subject individuals; subject individuals' supervisor(s); subject individuals' timekeeper(s); and the Office of Personnel Management.
None.
FRTIB Emergency Notification Records.
None.
Records are located at the Federal Retirement Thrift Investment Board, 77 K Street NE., Suite 1000, Washington, DC 20002. Records may also be located in additional locations in connection with cloud-based services and kept at an additional location as backup for Business Continuity purposes.
Civilian and contractor personnel working at the FRTIB located at 77 K Street NE., Washington, DC 20002; former employees; and individuals designated as emergency points of contact.
This system of records contains information regarding the following emergency contact information for FRTIB employees, and contractor personnel: Name; organizational office, or organizational name of contractor; title; position and duty status; name of supervisor; any volunteered medical information; office telephone number; government or business e-mail address; home address; home and cell phone numbers; personal email address(es); the identification of essential and non-essential employees; and other personal contact information. This system also contains the following information for the FRTIB employee or contractor's emergency contact: name; relationship to FRTIB employee or contractor; work address; home address; office telephone number; home and cell phone numbers; and email address(es).
5 U.S.C. 8474; 44 U.S.C. 3101; Executive Order 12656; and Presidential Decision Directive 67.
This system of records is maintained for contacting FRTIB personnel, including FRTIB employees and contractors, and other individuals to respond to all emergencies, including technical, manmade or natural disaster, or other event affecting FRTIB operations, and to contact FRTIB personnel's emergency contacts in the event of an emergency.
Information from this system of records is also used to prepare organizational charts, recall and emergency notification rosters, and directories for business continuity planning purposes, locate individuals on routine and/or emergency matters; locate individuals during medical emergencies, facility evacuations and similar situations involving threats; and similar administrative uses requiring personnel data.
Information about covered individuals may be disclosed without consent as permitted by the Privacy Act of 1974, 5 U.S.C. 552a(b), and:
d. General Routine Uses G1 through G2; G4 through G5; G7 through G9; and G11 through G17 apply to this system of records (see Prefatory Statement of General Routine Uses).
e. A record in this system of records may be disclosed to family members, emergency medical personnel, or to law enforcement officials in case of a medical or other emergency involving the subject individual (without the subsequent notification prescribed in 5 U.S.C. 552a(b)(8)).
None.
Records are maintained electronically in computer databases, including cloud-based services, and on paper in secure facilities in a locked drawer behind a secured-access door.
Records are retrieved by the name of the individual on whom they are maintained, and may also be retrieved by the individual's title or phone number.
FRTIB has adopted appropriate administrative, technical, and physical controls in accordance with FRTIB's security program to protect the security, confidentiality, availability, and integrity of the information, and to ensure that records are not disclosed to or accessed by unauthorized individuals.
Paper records are stored in file cabinets in areas of restricted access that are locked after office hours. Electronic records are stored on computer networks, including cloud-based services, and are protected by assigning usernames to individuals needing access to the records and by passwords set by unauthorized users that must be changed periodically.
Records are maintained as long as the individual is an employee or contractor for the Agency. Expired records are destroyed by shredding or purging from the Agency's electronic record keeping systems.
Physical Security Specialist, 77 K Street NE., Suite 1000, Washington, DC 20002.
Individuals seeking to determine whether this system of records contains information about themselves must submit a written request to the FOIA Officer, FRTIB, 77 K Street NE., Washington, DC 20002, and provide the following information:
f. Full name;
g. Any available information regarding the type of record involved;
h. The address to which the record information should be sent; and
i. You must sign your request.
Attorneys or other persons acting on behalf of an individual must provide written authorization from that individual, such as a Power of Attorney, in order for the representative to act on their behalf. Individuals requesting access must also comply with FRTIB's Privacy Act regulations regarding verification of identity and access to such records, available at 5 CFR part 1630.
Same as Notification Procedures.
Same as Notification Procedures.
Information is provided by the individual who is the subject of the record.
None.
Fraud and Forgery Records.
None.
Records are located at the Federal Retirement Thrift Investment Board, 77 K Street NE., Suite 1000, Washington, DC 20002. Records may also be kept at an additional location for Business Continuity purposes.
This system of records contains information on Thrift Savings Plan (TSP) participants, beneficiaries, alternate payees, and third party individuals alleged to have committed an act of fraud or forgery relating to participant and beneficiary accounts; and third parties alleged to have misappropriated, or attempted to misappropriate the FRTIB's (including the TSP's) name, brand, or logos.
These records contain the following kinds of information: Name, date of birth, and Social Security number of TSP participants, beneficiaries, alternate payees, and third parties alleged to have committed an act of fraud or forgery relating to participant accounts; TSP account information related to the fraud or forgery allegation; information obtained from other agencies as it relates to allegations of fraud or forgery; documentation of complaints and allegations of fraud and forgery; exhibits, statements, affidavits, or records obtained during investigations of fraud, or forgery, court and administrative orders, transcripts, and documents; internal staff memoranda; staff working papers; and other documents and records related to the investigation of fraud or forgery, including the disposition of the allegations; and reports on the investigation.
5 U.S.C. 8474; and 44 U.S.C. 3101.
These records are used to inquire into and investigate allegations that a TSP participant, beneficiary, alternate payee, or third party has committed or attempted to commit an act of fraud or forgery relating to a participant or beneficiary account; and to collect information to verify allegations that a third party has misappropriated the FRTIB's (or TSP's) name, brand, or logos.
Information about covered individuals may be disclosed without consent as permitted by the Privacy Act of 1974, as amended, 5 U.S.C. 552a(b); and:
8. General Routine Uses G1 through G2; G4 through G5; G8 through G14; and G16 apply to this system of records (see Prefatory Statement of General Routine Uses);
9. Information used to verify allegations that a third party has misappropriated the FRTIB's (or TSP's) name, brand, or logos may be disclosed to the Federal Bureau of Investigation, Department of Justice, or Securities and Exchange Commission for further investigation, prosecution, or enforcement;
10. A record from this system may be disclosed to the Secret Service for the purpose of investigating forgery, and to the Department of Justice, when substantiated by the Secret Service;
11. A record pertaining to may be disclosed to the current or former employing agency of the participant, beneficiary, alternate payee, or third party alleged to have committed fraud or forgery against a participant account for the purpose of further investigation or administrative action; and
12. A record from this system may be disclosed to informants, complainants, or victims to the extent necessary to provide those persons with information and explanations concerning the progress or results of the investigation.
None.
Records are maintained in paper and electronic form, including on computer databases, all of which are stored in a secure location.
Records are retrieved by name or file number.
FRTIB has adopted appropriate administrative, technical, and physical controls in accordance with FRTIB's security program to protect the security, confidentiality, availability, and integrity of the information, and to ensure that records are not disclosed to or accessed by unauthorized individuals.
Paper records are stored in locked file cabinets in areas of restricted access that are locked after office hours. Electronic records are stored on computer networks and protected by assigning usernames to individuals needing access to the records and by passwords set by authorized users that must be changed periodically.
Records in this system are destroyed seven years after the case is closed.
Supervisory Fraud Specialist, Federal Retirement Thrift Investment Board, 77 K Street NE., Suite 1000, Washington, DC 20002.
Individuals seeking to determine whether this system of records contains information about themselves should submit a written request to the FOIA Officer, 77 K Street NE., Washington, DC 20002, and include the following information:
a. Full name;
b. Any available information regarding the type of record involved;
c. The address to which the record information should be sent; and
d. You must sign your request.
Attorneys or other persons acting on behalf of an individual must provide written authorization from that individual, such as a Power of Attorney, in order for the representative to act on their behalf. Individuals requesting access must also comply with FRTIB's Privacy Act regulations regarding verification of identity and access to such records, available at 5 CFR part 1630.
Same as Notification Procedures.
Same as Notification Procedures.
Records in this system may be provided by or obtained from the following: Persons to whom the information relates when practicable, including TSP participants, beneficiaries, alternate payees, or other third parties; complainants; informants; witnesses; investigators; persons reviewing the allegations; Federal, state and local agencies; and investigative reports and records.
Pursuant to 5 U.S.C. 552a(k)(2), records in this system of records are exempt from the requirements of subsections (c)(3); (d); (e)(1); (e)(4)(G), (H), (I); and (f) of 5 U.S.C. 552a, provided, however, that if any individual is denied any right, privilege, or benefit that he or she would otherwise be entitled to by federal law, or for which he or she would otherwise be eligible, as a result of the maintenance of these records, such material shall be provided to the individual, except to the extent that the disclosure of the material would reveal the identity of a source who furnished information to the Government with an express promise that the identity of the source would be held in confidence.
FRTIB Legal Case Files.
None.
Records are located at the Federal Retirement Thrift Investment Board, 77 K Street NE., Suite 1000, Washington,
Individuals who are participants, beneficiaries, and alternate payees of the Thrift Savings Plan; other individuals who are identified in connection with investigations and/or litigation conducted with regard to FERSA; individuals (including FRTIB employees) who are parties to or witnesses in civil litigation or administrative proceedings involving or concerning FRTIB or its officers or employees (including Special Governmental Employees); individuals who are the subject of a breach of personally identifiable information; individuals who are contractors or potential contractors with FRTIB or are otherwise personally associated with a contract or procurement matter; individuals who receive legal advice from the Office of General Counsel; and other individuals (including current, former, and potential FRTIB employees (including Special Governmental Employees), contractors, interns, externs, and volunteers) who are the subject of or are otherwise connected to an inquiry, investigation, or other matter handled by the Office of General Counsel.
Notes, reports, legal opinions and memoranda; settlements; agreements; documentary evidence; claims and records regarding discrimination; correspondence; contracts; contract proposals and other procurement documents; TSP documents; participant, beneficiary, and alternate payee files; initial and final FRTIB determinations of FERSA matters; Freedom of Information Act and Privacy Act requests and appeals, and decisions of those requests and appeals; drafts and legal reviews of proposed personnel actions; personnel records; litigation files; employee relations files; witness statements; summonses and subpoenas; affidavits; court transcripts; discovery requests and responses; and breach reports and supporting documents.
5 U.S.C. 8474; and 44 U.S.C. 3301.
The purpose of this system is to assist FRTIB attorneys in providing legal advice to FRTIB personnel on a wide variety of legal issues; to collect the information of any individual who is, or will be, in litigation with the Agency, as well as the attorneys representing the plaintiff(s) or defendant(s), response to claims by employees, former employees, and other individuals; to assist in the settlement of claims against the government; to represent FRTIB during litigation; and to catalogue, investigate, litigate, or otherwise resolve any case or matter handled by the Office of General Counsel.
Information about covered individuals may be disclosed without consent as permitted by the Privacy Act of 1974, 5 U.S.C. 552a(b), and:
1. General Routine Uses G1 through G16 apply to this system of records (see Prefatory Statement of General Routine Uses).
2. Names, addresses, telephone numbers, and email addresses of employees, former employees, participants, beneficiaries, alternate payees, and information pertaining to debts to the FRTIB may be disclosed to the Department of Treasury, Department of Justice, a credit agency, and a debt collection firm to collect the debt. Disclosure to a debt collection firm shall be made only under a contract that binds any such contractor or employee of such contractor to the criminal penalties of the Privacy Act.
3. Information may be provided to third parties during the course of an investigation to the extent necessary to obtain information pertinent to the investigation.
4. A record relating to a case or matter may be disseminated to a foreign country pursuant to an international treaty or convention entered into and ratified by the United States or to an executive agreement.
5. A record may be disseminated to a foreign country, through the United States Department of State or directly to the representative of such country, to the extent necessary, to assist such country in civil or criminal proceedings in which the United States or one of its officers or agents has an interest.
Information from this system of records may be disclosed to a consumer reporting agency in accordance with 31 U.S.C. 3711(e).
Records are maintained electronically in computer databases, including cloud-based services, and on paper in secure facilities in a locked drawer behind a secured-access door.
Records are retrieved by the name of the individual on whom they are maintained, and may also be retrieved by case number.
FRTIB has adopted appropriate administrative, technical, and physical controls in accordance with FRTIB's security program to protect the security, confidentiality, availability, and integrity of the information, and to ensure that records are not disclosed to or accessed by unauthorized individuals.
Paper records are stored in file cabinets in areas of restricted access that are locked after office hours. Electronic records are stored on computer networks, including cloud-based services, and are protected by assigning usernames to individuals needing access to the records and by passwords set by unauthorized users that must be changed periodically.
Records are maintained in accordance with the General Records Retention Schedules issued by the National Archives and Records Administration (NARA) or an FRTIB records disposition schedule.
General Counsel, Federal Retirement Thrift Investment Board, 77 K Street NE., Suite 1000, Washington, DC 20002.
Individuals seeking to determine whether this system of records contains information about themselves must submit a written request to the FOIA Officer, FRTIB, 77 K Street NE., Washington, DC 20002, and provide the following information:
j. Full name;
k. Any available information regarding the type of record involved;
l. The address to which the record information should be sent; and
m. Your signature.
Attorneys or other persons acting on behalf of an individual must provide written authorization from that individual, such as a Power of Attorney, in order for the representative to act on their behalf. Individuals requesting access must also comply with FRTIB's Privacy Act regulations regarding verification of identity and access to such records, available at 5 CFR part 1630.
Same as Notification Procedures.
Same as Notification Procedures.
Subject individuals; TSP participants, beneficiaries, and alternate payees; federal government records; current, and former, and potential employees (including Special Government Employees); contractors; interns, externs, and volunteers; the Social Security Administration; court records; articles from publications; and other organizations or individuals with relevant knowledge or information.
Pursuant to 5 U.S.C. 552a(k)(2), records from this system are exempt from the requirements of subsections (c)(3); (d); (e)(1); (e)(4)(G), (H), (I); and (f) of 5 U.S.C. 552a, provided, however, that if any individual is denied any right, privilege, or benefit that he or she would otherwise be entitled to by Federal law, or for which he or she would otherwise be eligible, as a result of the maintenance of these records, such material shall be provided to the individual, except to the extent that the disclosure of the material would reveal the identity of a source who furnished information to the Government with an express promise that the identity of the source would be held in confidence.
Internal Investigations of Harassment and Hostile Work Environment Allegations.
None.
Records are located at the Federal Retirement Thrift Investment Board, 77 K Street NE., Suite 1000, Washington, DC 20002. Records may also be located in additional locations for Business Continuity purposes.
Current or former FRTIB employees (including Special Government Employees), contractors, interns, externs, and volunteers who have filed a complaint or report of harassment or hostile work environment, or have been accused of harassing conduct; and witnesses or potential witnesses.
This system of records contains all documents related to a complaint or report of harassment, which may include the name, position, grade, and supervisor(s) of the complainant and the accused; the complaint; witness statements; interview notes; legal memoranda; reports of investigation; final decisions and corrective actions taken; and related correspondence and exhibits.
5 U.S.C. 8474; 42 U.S.C. 2000e
This system of records is maintained for the purpose of upholding FRTIB's policy to provide for a work environment free from all forms of harassment, including sexual harassment, and harassment on the basis of race, color, gender, national origin, religion, sexual orientation, age, genetic information, reprisal, parental status, or disability.
Information about covered individuals may be disclosed without consent as permitted by the Privacy Act of 1974, 5 U.S.C. 552a(b), and:
6. General Routine Uses G1 through G16 apply to this system of records (see Prefatory Statement of General Routine Uses).
7. Disclosure of information from this system of records about an investigation that may have been conducted may be made to the complaining party; the alleged harasser; and to a limited number of witnesses when the purpose of the disclosure is both relevant and necessary and is compatible with the purpose for which the information was collected.
None.
Records are maintained electronically in computer databases, including cloud-based services, and on paper in secure facilities in a locked drawer behind a secured-access door.
Records are retrieved by the name of the individual on whom they are maintained, and may also be retrieved by case number.
FRTIB has adopted appropriate administrative, technical, and physical controls in accordance with FRTIB's security program to protect the security, confidentiality, availability, and integrity of the information, and to ensure that records are not disclosed to or accessed by unauthorized individuals.
Paper records are stored in file cabinets in areas of restricted access that are locked after office hours. Electronic records are stored on computer networks, including cloud-based services, and are protected by assigning usernames to individuals needing access to the records and by passwords set by unauthorized users that must be changed periodically.
Records are maintained in accordance with the General Records Retention Schedules issued by the National Archives and Records Administration (NARA) or an FRTIB records disposition schedule.
Human Resources Officer, Federal Retirement Thrift Investment Board, 77 K Street NE., Suite 1000, Washington, DC 20002.
Individuals seeking to determine whether this system of records contains information about themselves must submit a written request to the FOIA Officer, FRTIB, 77 K Street NE., Washington, DC 20002, and provide the following information:
n. Full name;
o. Any available information regarding the type of record involved;
p. The address to which the record information should be sent; and
q. Your signature.
Attorneys or other persons acting on behalf of an individual must provide written authorization from that individual, such as a Power of Attorney, in order for the representative to act on their behalf. Individuals requesting access must also comply with FRTIB's Privacy Act regulations regarding verification of identity and access to such records, available at 5 CFR part 1630.
Same as Notification Procedures.
Same as Notification Procedures.
Subject individuals; supervisors and other FRTIB employees with knowledge; agency EEO and human resources specialists; employee relations staff; FRTIB attorneys; outside counsel retained by subject individuals; and medical professionals.
Pursuant to 5 U.S.C. 552a(k)(2), records in this system are exempt from the requirements of subsections (c)(3); (d); (e)(1); (e)(4)(G), (H), (I); and (f) of 5 U.S.C. 552a, provided, however, that if any individual is denied any right, privilege, or benefit that he or she would otherwise be entitled to by Federal law, or for which he or she would otherwise be eligible, as a result of the maintenance of these records, such material shall be provided to the individual, except to the extent that the disclosure of the material would reveal the identity of a source who furnished information to the Government with an express promise that the identity of the source would be held in confidence.
Commission to Eliminate Child Abuse and Neglect Fatalities.
Meeting Notice.
The Commission to Eliminate Child Abuse and Neglect Fatalities (CECANF), a Federal Advisory Committee established by the Protect Our Kids Act of 2012, Public Law 112-275, will hold a meeting open to the public on Thursday, August 6, 2015 and Friday, August 7, 2015 in New York, New York.
The meeting will be held on Thursday, August 6, 2015, from 8:00 a.m. to 5:30 p.m., Eastern Daylight Time, and Friday, August 7, 2015, from 8:00 a.m. to 12:30 p.m., Eastern Daylight Time.
CECANF will convene its meeting at the ACS Children's Center Auditorium, 492 First Avenue at 28th Street, New York, NY 10016. This site is accessible to individuals with disabilities. The meeting also will be made available via teleconference and/or webinar.
Submit comments identified by “Notice-CECANF-2015-07,” by either of the following methods:
• Regulations.gov:
Submit comments via the Federal eRulemaking portal by searching for “Notice-CECANF-2015-07.” Select the link “Comment Now” that corresponds with “Notice-CECANF-2015-07.” Follow the instructions provided on the screen. Please include your name, organization name (if any), and “Notice-CECANF-2015-07” on your attached document.
•
Visit the CECANF Web site at
However, members of the public wishing to comment should follow the steps detailed under the heading
Office of Acquisition Policy, General Services Administration (GSA).
Notice of request for comments regarding an extension of a previously existing OMB clearance.
Under the provisions of the Paperwork Reduction Act the Regulatory Secretariat Division will be submitting to the Office of Management and Budget (OMB) a request to review and approve an extension of a previously approved information collection requirement regarding identification of products with environmental attributes. A notice was published in the
Submit comments on or before: August 21, 2015.
Submit comments identified by Information Collection 3090-0262, Identification of Products with Environmental Attributes, by any of the following methods:
•
•
Ms. Dana Munson, Procurement Analyst, General Services Acquisition Policy Division, GSA, at telephone 202-357-9652 or via email to
The General Services Administration (GSA) requires contractors holding Multiple Award Schedule Contracts to identify in their GSA price lists those products that they market commercially that have environmental attributes in accordance with GSAR clause 552.238-72. The identification of these products will enable Federal agencies to maximize the use of these products and meet the responsibilities expressed in statutes and executive orders.
Public comments are particularly invited on: Whether this collection of information is necessary and whether it will have practical utility; whether our estimate of the public burden of this collection of information is accurate and based on valid assumptions and methodology; and ways to enhance the quality, utility, and clarity of the information to be collected.
Food and Drug Administration, HHS.
Notice.
This notice announces a forthcoming meeting of a public advisory committee of the Food and Drug Administration (FDA). The meeting will be open to the public.
FDA is opening a docket for interested persons to submit electronic or written comments regarding this meeting. The docket number is FDA-2014-N-0736. Please see the
FDA is convening this committee to seek expert scientific and clinical opinion on the risks and benefits of the Essure System. The committee will be asked to evaluate currently available scientific data pertaining to the safety and effectiveness of the Essure System, such as events related to implant perforation/migration, device removal, chronic pain, allergic reactions, and unintended pregnancy. The committee will be asked to provide recommendations regarding appropriate device use, product labeling, and potential need for additional postmarket clinical studies.
FDA intends to make background material available to the public no later than 2 business days before the meeting. If FDA is unable to post the background material on its Web site prior to the meeting, the background material will be made publicly available at the location of the advisory committee meeting, and the background material will be posted on FDA's Web site after the meeting. Background material is available at
CDRH plans to provide a live Webcast of the September 24, 2015, meeting of the Obstetrics and Gynecology Devices Panel. While CDRH is working to make Webcasts available to the public for all advisory committee meetings held at the White Oak campus, there are instances where the Webcast transmission is not successful; staff will work to re-establish the transmission as soon as possible. The link for the Webcast is available at:
FDA is opening a docket for public comment on this document. The docket will close on October 24, 2015. Interested persons are encouraged to use the docket to submit electronic or written comments regarding this meeting. Comments received on or before August 31, 2015, will be provided to the committee. Comments received after that date will be taken into consideration by the Agency.
Submit electronic comments to
For press inquiries, please contact the Office of Media Affairs at
Persons attending FDA's advisory committee meetings are advised that the Agency is not responsible for providing access to electrical outlets.
FDA welcomes the attendance of the public at its advisory committee meetings and will make every effort to accommodate persons with physical disabilities or special needs. If you require special accommodations due to a disability, please contact Ann Marie Williams, at
FDA is committed to the orderly conduct of its advisory committee meetings. Please visit our Web site at
Notice of this meeting is given under the Federal Advisory Committee Act (5 U.S.C. app. 2).
Health Resources and Services Administration, Department of Health and Human Services.
Notice.
In compliance with the requirement for opportunity for public comment on proposed data collection projects (section 3506(c)(2)(A) of the Paperwork Reduction Act of 1995), the Health Resources and Services Administration (HRSA) announces plans to submit an Information Collection Request (ICR), described below, to the Office of Management and Budget (OMB). Prior to submitting the ICR to OMB, HRSA seeks comments from the public regarding the burden estimate, below, or any other aspect of the ICR.
Comments on this Information Collection Request must be received no later than August 21, 2015.
Submit your comments, including the Information Collection Request Title, to the desk officer for HRSA, either by email to
To request a copy of the clearance requests submitted to OMB for review, email the HRSA Information Collection Clearance Officer at
When submitting comments or requesting information, please include the information request collection title for reference.
New York State Department of Health AIDS Institute, Office of the Medical Director.
This study will examine how Ryan White-funded clinics are integrating the provision of primary and preventative care services to the overall HIV care model. Specifically, it will look at the protocols and strategies used by clinics to manage care for PLWH, specifically care coordination, referral systems, and patient-centered strategies to keep PLWH in care.
These data will provide HAB the background to make informed policies and changes to the Ryan White Program in this new era when the well-being of PLWH demands a more complex and long-term HIV care model.
Total Estimated Annualized burden hours:
HRSA specifically requests comments on (1) the necessity and utility of the proposed information collection for the proper performance of the agency's functions, (2) the accuracy of the estimated burden, (3) ways to enhance the quality, utility, and clarity of the information to be collected, and (4) the use of automated collection techniques or other forms of information technology to minimize the information collection burden.
This notice amends Part R of the Statement of Organization, Functions and Delegations of Authority of the Department of Health and Human Services (HHS), Health Resources and Services Administration (HRSA) (60 FR 56605, as amended November 6, 1995; as last amended at 80 FR 37639-37640 dated July 1, 2015).
This notice reflects organizational changes in the Health Resources and Services Administration (HRSA), HIV/AIDS Bureau (RV). Specifically, this notice: (1) Establishes the Office of HIV/AIDS Training and Capacity Development (RVT); (2) transfers the Division of HIV/AIDS Training and Capacity Development (RV7) function to the newly established Office of HIV/AIDS Training and Capacity Development (RVT); (3) abolishes the Division of HIV/AIDS Training and Capacity Development (RV7); (4) establishes the Division of Domestic Programs (RVT1), and; (5) establishes the Division of Global Programs (RVT2).
Delete the organization for the HIV/AIDS Bureau (RV) in its entirety and replace with the following:
The HIVAIDS Bureau (RV) is headed by the Associate Administrator, who reports directly to the Administrator, Health Resources and Services Administration. The HIV/AIDS Bureau includes the following components:
(1) Office of the Associate Administrator (RV);
(2) Office of Operations and Management (RV2);
(3) Division of Policy and Data (RVA);
(4) Division of Metropolitan HIV/AIDS Programs (RV5);
(5) Division of State HIV/AIDS Programs (RVD);
(6) Division of Community HIV/AIDS Programs (RV6);
(7) Office of HIV/AIDS Training and Capacity Development (RVT);
(a) Division of Domestic Programs (RVT1); and
(b) Division of Global Programs (RVT2).
Delete the functions for the Division of HIV/AIDS Training and Capacity Development and, replace in its entirety.
The Office of HIV/AIDS Training and Capacity Development provides national leadership and manages the implementation of Part F under Title XXVI of the PHS Act as amended by the Ryan White HIV/AIDS Treatment Extension Act of 2009, Public Law 111-87 (the Ryan White HIV/AIDS Program), including the Special Projects of National Significance and the AIDS Education and Training Centers Programs. The Special Projects of National Significance Program develops innovative models of HIV care and the AIDS Education and Training Centers Program increases the number of health care providers who are educated and motivated to counsel, diagnose, treat, and medically manage people with HIV disease and to help prevent high-risk behaviors that lead to HIV transmission. The Office also implements the training and systems strengthening functions of the Global HIV/AIDS Program as part of the President's Emergency Plan for AIDS Relief (PEPFAR). This includes strengthening health systems for delivery of prevention, care and treatment services for people living with HIV/AIDS in PEPFAR funded countries and providing management and oversight of international programs aimed at improving quality and innovation in health professions education and training. The Office will translate lessons learned from both the Global HIV/AIDS Programs and Special Projects of National Significance projects to the Part A, B, C, D, and F grantee community. In collaboration with the Division of Policy and Data, the division assesses effectiveness of technical assistance efforts/initiatives, identifies new technical assistance needs and priority areas, and participates in the bureau-wide technical assistance workgroup.
The Division of Domestic Programs is responsible for activities associated with the planning, development, implementation, evaluation, and coordination of the AIDS Education and Training Center Program. The Division is aimed at developing and sustaining HIV clinical expertise, increasing the number of direct care clinical providers who are competent and willing to clinically manage HIV infected patients through education, training, longitudinal information support, clinical consultation, and technical assistance, as well as, a variety of Minority AIDS Initiative and National HIV/AIDS Strategy related training projects, and other associated activities.
The Division of Global Programs provides leadership in improving care and treatment and support services for People Living with HIV/AIDS outside of the United States and its territories. The division: (1) In coordination with the Department of State/Office of the Global AIDS Coordinator, plans, develops, implements, evaluates, and coordinates the activities of the clinical assessment system strengthening, Medical Education Partnership Initiative, Nursing Education Partnership Initiative, the International Training and Education Center for Health, quality improvement, and twinning center programs; (2) provides guidance and expertise to funded programs; (3) develops funding opportunity announcements and program guidance documents; (4) conducts on-site program reviews and reviews of pertinent and required reports, and activities to assess compliance with program policies and country priorities; (5) in conjunction with other division, bureau, and agency entities, assists in the planning and implementation of priority HIV activities such as workgroups, meetings, and evaluation projects; (6) collaborates with other federal agencies and in-country partners in the implementation of the PEPFAR program, and; (7) provides management and oversight of international programs aimed at improving quality and innovation in health professions education, retention, training, faculty development and applied research systems.
All delegations of authority and re-delegations of authority made to HRSA officials that were in effect immediately prior to this reorganization, and that are consistent with this reorganization, shall continue in effect pending further re-delegation.
This reorganization is effective upon date of signature.
In accordance with section 10(a)(2) of the Federal Advisory Committee Act (92), notice is hereby given of the following meeting:
Advisory Committee on Training in Primary Care Medicine and Dentistry (ACTPCMD).
Parklawn Building, Room 18-67, 5600 Fishers Lane, Rockville, Maryland 08057 and, Webinar and Conference Call Format.
The meeting will be open to the public.
The ACTPCMD provides advice and recommendations on a broad range of issues relating to grant programs authorized by Title VII, part C, sections 747 and 748 of the Public Health Service Act. The ACTPCMD members will discuss the 13th report on the role of health professions education in addressing the social determinants of health. The ACTPCMD's reports are submitted to the Secretary of Health and Human Services; the Committee on Health, Education, Labor, and Pensions of the Senate; and the Committee on Energy and Commerce of the House of Representatives.
The ACTPCMD agenda includes an opportunity for members to discuss the 13th report on the role of health profession education in addressing the social determinants of health. The official agenda will be available 2 days prior to the meeting on the HRSA Web site (
Requests to make oral comments or provide written comments to the ACTPCMD
The conference call-in number is 800-619-2521. The passcode is: 9271697.
The webinar link is
Anyone requesting information regarding the ACTPCMD should contact Dr. Joan Weiss, Designated Federal Official within the Bureau of Health Workforce, Health Resources and Services Administration, in one of three ways: (1) Send a request to the following address: Dr. Joan Weiss, Designated Federal Official, Bureau of Health Workforce, Health Resources and Services Administration, Parklawn Building, Room 12C-05, 5600 Fishers Lane, Rockville, Maryland 20857; (2) call (301) 443-0430; or (3) send an email to
Health Resources and Services Administration, HHS.
Notice.
In compliance with Section 3507(a)(1)(D) of the Paperwork Reduction Act of 1995, the Health Resources and Services Administration (HRSA) has submitted an Information Collection Request (ICR) to the Office of Management and Budget (OMB) for review and approval. Comments submitted during the first public review of this ICR will be provided to OMB. OMB will accept further comments from the public during the review and approval period.
Comments on this ICR should be received no later than August 21, 2015.
Submit your comments, including the Information Collection Request Title, to the desk officer for HRSA, either by email to
To request a copy of the clearance requests submitted to OMB for review, email the HRSA Information Collection Clearance Officer at
Health Resources and Services Administration, HHS.
Notice.
In compliance with the requirement for opportunity for public comment on proposed data collection projects (Section 3506(c)(2)(A) of the Paperwork Reduction Act of 1995), the Health Resources and Services Administration (HRSA) announces plans to submit an Information Collection Request (ICR), described below, to the Office of Management and Budget (OMB). Prior to submitting the ICR to OMB, HRSA seeks comments from the public regarding the burden estimate below, or any other aspect of the ICR.
Comments on this Information Collection Request must be received no later than September 21, 2015.
Submit your comments to
To request more information on the proposed project or to obtain a copy of the data collection plans and draft instruments, email
When submitting comments or requesting information, please include the information request collection title for reference.
The information collected from the progress report forms will serve multiple purposes. The information will be used to inform new technical assistance needs and evaluate the performance and outcome of the funding initiative. The progress reports will also enhance HRSA's ability to respond to departmental inquiries regarding the program in a timely and accurate manner. Information will also be used in the preparation of reports to Congress and other external agencies.
In addition to meeting the goal of accountability to Congress, patients, and the general public, information collected from the progress reports are critical for HRSA grantees and individual providers to assess the status of existing EHR systems and health outcomes for patients. The partnership between HRSA, grantees, providers, and patients provides a unique opportunity to ensure that all parties share in the benefits of accurate information, lessons learned, major accomplishments, barriers encountered, and technical assistance to promote improved care and efficiency.
Likely Respondents: Type of respondents expected are existing networks that are currently serving health centers and other safety net entities.
Burden Statement: Burden in this context means the time expended by persons to generate, maintain, retain, disclose or provide the information requested. This includes the time needed to review instructions; to develop, acquire, install and utilize technology and systems for the purpose of collecting, validating and verifying information, processing and maintaining information, and disclosing and providing information; to train personnel and to be able to respond to a collection of information; to search data sources; to complete and review the collection of information; and to transmit or otherwise disclose the information.
The total annual burden hours estimated for this Information Collection Request are summarized in the table below.
Total Estimated Annualized hours: 1350.
HRSA specifically requests comments on (1) the necessity and utility of the proposed information collection for the proper performance of the agency's functions, (2) the accuracy of the estimated burden, (3) ways to enhance the quality, utility, and clarity of the information to be collected, and (4) the use of automated collection techniques or other forms of information technology to minimize the information collection burden.
Health Resources and Services Administration, HHS.
Notice.
In compliance with Section 3507(a)(1)(D) of the Paperwork Reduction Act of 1995, the Health Resources and Services Administration (HRSA) has submitted an Information Collection Request (ICR) to the Office of Management and Budget (OMB) for review and approval. Comments submitted during the first public review of this ICR will be provided to OMB. OMB will accept further comments from the public during the review and approval period.
Comments on this ICR should be received no later than August 21, 2015.
Submit your comments, including the Information Collection Request Title, to the desk officer for HRSA, either by email to
To request a copy of the clearance requests submitted to OMB for review, email the HRSA Information Collection Clearance Officer at
The information collected will be used to review grantee progress on proposed project plans sufficient to permit project officers to assess whether the project is performing adequately to achieve the goals and objectives that were previously approved. This report will also provide implementation plans for the upcoming year, which project officers can assess to determine whether the plan is consistent with the grant as approved, and will result in implementation of a high-quality project that will complement the home visiting program as a whole. Progress Reports are submitted to project officers through the Electronic HandBooks (EHB). Failure to collect this information would result in the inability of the project officers to exercise due diligence in monitoring and overseeing the use of grant funds in keeping with legislative, policy, and programmatic requirements. Grantees are required to provide a performance narrative with the following sections: Project identifier information, accomplishments and barriers, state home visiting program goals and objectives, an update on the state home visiting program promising approach and evaluations conducted under the competitive grant, implementation of the state home visiting program in targeted at-risk communities, progress toward meeting legislatively-mandated reporting on benchmark areas, state home visiting quality improvement efforts, and updates on the administration of state home visiting program.
Since federal fiscal year 2011, 48 eligible entities have received competitive grant awards. Grantees of the competitive grant program need to complete annual reports in order to comply with HRSA reporting requirements. Some grantees have been awarded up to three competitive grants to date.
In the event a new Funding Opportunity Announcement is issued annually for the competitive grant program, the application for new grant funds may take the place of completion of a non-competing continuation progress report.
Indian Health Service, HHS.
Notice of meeting.
The Indian Health Service (IHS) is seeking broad public input as it begins efforts to advance and promote the health needs of the American Indian/Alaska Native (AI/AN) Lesbian, Gay, Bisexual, and Transgender (LGBT) community.
The meeting will be held as shown below:
1. July 27, 2015 from 9:00 a.m. EST to 4:30 p.m. EST.
The meeting location is:
1. Rockville, MD—801 Thompson Avenue, Rockville, MD 20852.
Written statements may be submitted to Lisa Neel, MPH, Program Coordinator, Office of Clinical and Preventive Services, Indian Health Service, 801 Thompson Avenue, Suite 300, Rockville, MD 20852.
Lisa Neel, MPH, Program Coordinator, Office of Clinical and Preventive Services, Indian Health Service, 801 Thompson Avenue, Suite 300, Rockville, MD 20852, Telephone 301-443-4305. (This is not a toll-free number.)
The meeting will be open to the public. To facilitate the building security process, those who plan to attend should RSVP to Lisa Neel at
Indian Health Service, HHS.
Notice; correction.
The Indian Health Service published a document in the
Mr. Paul Gettys, Grant Systems Coordinator, Division of Grants Management (DGM), Indian Health Service, 801 Thompson Avenue, Suite TMP 360, Rockville, MD 20852, Telephone direct (301) 443-2114, or the DGM main number (301) 443-5204. (This is not a toll-free number.)
In the
• Expand available behavioral health care treatment services;
• Foster coalitions and networks to improve care coordination;
• Educate and train providers in the care of suicide screening and evidence-based suicide care;
• Promote community education to recognize the signs of suicide, and prevent and intervene in suicides and suicide ideations;
• Improve health system organizational practices to provide evidence-based suicide care;
• Establish local health system policies for suicide prevention, intervention, and postvention;
• Integrate culturally appropriate treatment services; and
• Implement trauma informed care services and programs.
Under the provisions of section 3507(a)(1)(D) of the Paperwork Reduction Act of 1995, the National
To obtain a copy of the data collection plans and instruments or request more information on the proposed project contact: Nicole Moore, Division of Cancer Biology, 9609 Medical Center Drive, Room 6W508, Bethesda, MD 20892-9714 or call non-toll-free number 301-325-7534 or Email your request, including your address to:
OMB approval is requested for 1 year. There are no costs to respondents other than their time. The total estimated annualized burden hours are 955.
Pursuant to section 10(d) of the Federal Advisory Committee Act, as amended (5 U.S.C. App.), notice is hereby given of the following meetings.
The meetings will be closed to the public in accordance with the provisions set forth in sections 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., as amended. The grant applications and the discussions could disclose confidential trade secrets or commercial property such as patentable material, and personal information concerning individuals associated with the grant applications, the disclosure of which would constitute a clearly unwarranted invasion of personal privacy.
This notice is being published less than 15 days prior to the meeting due to the timing limitations imposed by the review and funding cycle.
This notice is being published less than 15 days prior to the meeting due to the timing limitations imposed by the review and funding cycle.
Pursuant to section 10(d) of the Federal Advisory Committee Act, as amended (5 U.S.C. App.), notice is hereby given of a meeting of the National Advisory Council on Alcohol Abuse and Alcoholism.
The meeting will be open to the public as indicated below, with attendance limited to space available. Individuals who plan to attend and need special assistance, such as sign language interpretation or other reasonable accommodations, should notify the Contact Person listed below in advance of the meeting.
The meeting will be closed to the public in accordance with the provisions set forth in sections 552b(c)(4) and 552b(c)(6), Title 5 U.S.C., as amended. The grant applications and/or contract proposals and the discussions could disclose confidential trade secrets or commercial property such as patentable material, and personal information concerning individuals associated with the grant applications and/or contract proposals, the disclosure of which would constitute a clearly unwarranted invasion of personal privacy.
Closed: 9:00 a.m. to 10:00 a.m.
Open: 10:15 a.m. to 4:00 p.m.
Any interested person may file written comments with the committee by forwarding the statement to the Contact Person listed on this notice. The statement should include the name, address, telephone number and when applicable, the business or professional affiliation of the interested person.
Information is also available on the Institute's/Center's home page:
In compliance with section 3506(c)(2)(A) of the Paperwork Reduction Act of 1995 concerning opportunity for public comment on proposed collections of information, the Substance Abuse and Mental Health Services Administration (SAMHSA) will publish periodic summaries of proposed projects. To request more information on the proposed projects or to obtain a copy of the information collection plans, call the SAMHSA Reports Clearance Officer on (240) 276-1243.
Comments are invited on: (a) Whether the proposed collections of information are necessary for the proper performance of the functions of the agency, including whether the information shall have practical utility; (b) the accuracy of the agency's estimate of the burden of the proposed collection of information; (c) ways to enhance the quality, utility, and clarity of the information to be collected; and (d) ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques or other forms of information technology.
The Substance Abuse and Mental Health Services Administration (SAMHSA) is requesting a revision of the National Survey of Substance Abuse Treatment (N-SSATS) data collection (OMB No. 0930-0106), which expires on January 31, 2016. N-SSATS provides both national and state-level data on the numbers and types of patients treated and the characteristics of facilities providing substance abuse treatment services. It is conducted under the authority of section 505 of the Public Health Service Act (42 U.S.C. 290aa-4) to meet the specific mandates for annual information about public and private substance abuse treatment providers and the clients they serve.
This request includes:
• Collection of N-SSATS, which is an annual survey of substance abuse treatment facilities; and
• Updating of the Inventory of Behavioral Health Services (I-BHS) which is the facility universe for the N-SSATS as well as the annual survey of mental health treatment facilities, the National Mental Health Services Survey (N-MHSS). The I-BHS includes all substance abuse treatment and mental health treatment facilities known to SAMHSA. (The N-MHSS data collection is covered under OMB No. 0930-0119.)
The information in I-BHS and N-SSATS is needed to assess the nature and extent of these resources, to identify gaps in services, and to provide a database for treatment referrals. Both I-BHS and N-SSATS are components of the Behavioral Health Services Information System (BHSIS).
The request for OMB approval will include a request to update the I-BHS facility listing on a continuous basis and to conduct the N-SSATS and the between cycle N-SSATS (N-SSATS BC) in 2016, 2017, and 2018. The N-SSATS BC is a procedure for collecting services data from newly identified facilities between main cycles of the survey and will be used to improve the listing of treatment facilities in the online Behavioral Health Treatment Services Locator.
The workforce questions will be conducted in even years in place of the “locator” version of N-SSATS that was completed in even years previously.
The following questions have been deleted:
Questions on religious affiliation, standard operating procedures, how (paper/electronic/both) a facility performs selected activities, questions about reporting client counts, including how the facility will complete client counts; number of facilities in client counts; names and addresses of additional facilities reported for; number of hospital inpatient client counts by category, by number under age 18, number receiving methadone, buprenorphine, or Vivitrol®, and number of dedicated beds; number of residential client counts by category, by number under age 18, and number receiving methadone, buprenorphine, or Vivitrol®, and number of dedicated beds; number of outpatient client counts by category, by number under age 18, and number receiving methadone, buprenorphine, or Vivitrol®, and capacity indicator; type of substance abuse problem, percent of co-occurring clients; and 12-month admissions, and the National Provider Identifier (NPI).
The following questions have been added:
A new question has been added to ascertain the numbers of types of workforce staff and the average number of hours worked per week for each type of staff. Three questions, one for each of the major types of treatment (hospital inpatient, residential, and outpatient) have been added asking for an overall number of active clients on the survey reference date; the purpose is to provide an indication of size of facility for analysis of the added workforce questions. A question asking overall numbers of active clients in the facility that received methadone, buprenorphine, or Vivitrol® for detoxification or maintenance purposes has been added to aid in the analysis of the added workforce question.
Client counts will be conducted in odd years. The National Provider Identifier (NPI) number question has been deleted.
Estimated annual burden for the DASIS activities is shown below:
Send comments to Summer King, SAMHSA Reports Clearance Officer, Room 2-1057, One Choke Cherry Road, Rockville, MD 20857 or email her a copy at
U.S. Customs and Border Protection, Department of Homeland Security.
Notice of final determination.
This document provides notice that U.S. Customs and Border Protection (“CBP”) has issued a final determination concerning the country of origin of the VistA imaging tier II storage infrastructure solution (“VistA Storage Solution”) manufactured and distributed by Merlin International (“Merlin”). Based upon the facts presented, CBP has concluded that the United States will be the country of origin of the VistA Storage Solution for purposes of U.S. Government procurement.
The final determination was issued on July 16, 2015. A copy of the final determination is attached. Any party-at-interest, as defined in 19 CFR 177.22(d), may seek judicial review of this final determination within August 21, 2015.
Antonio J. Rivera, Valuation and Special Programs Branch, Regulations and Rulings, Office of International Trade (202) 325-0226.
Notice is hereby given that on July 16, 2015 pursuant to subpart B of Part 177, U.S. Customs and Border Protection Regulations (19 CFR part 177, subpart B), CBP has issued a final determination concerning the country of origin of the VistA Storage Solution manufactured and distributed by Merlin, which may be offered to the U.S. Government under an undesignated government procurement contract. This final determination, HQ H259758, was issued under procedures set forth at 19 CFR part 177, subpart B, which implements Title III of the Trade Agreement Act of 1979, as amended (19 U.S.C. 2511-18). In the final determination CBP found that, based upon the facts presented, four U.S.-origin hardware and software components and two foreign-origin hardware and software components were integrated into one end product, the VistA Storage Solution. CBP found that assembling the hardware components together, loading the software components onto the hardware components, and configuring the software components to reach the desired storage infrastructure, which were processes that took place entirely in the United States, substantially transformed the individual components into the final product, the VistA Storage Solution. CBP noted that the majority of the components were from the United States; that the processing took place entirely in the United States; that the name, character and use of the individual components differed from the name, character and use of the final product; that the tariff classification of the foreign components changed when they were integrated into the final product; and, the cost breakdown of each component, to find that under the totality of the circumstances, the country of origin of the VistA Storage Solution will be the United States for purposes of U.S. Government procurement.
Section 177.29, CBP Regulations (19 CFR 177.29), provides that a notice of final determination shall be published in the
This is in response to your letter, dated November 21, 2014, requesting a final determination on behalf of Merlin International, Inc. (“Merlin”), pursuant to subpart B of part 177 of the U.S. Customs and Border Protection (“CBP”) Regulations (19 C.F.R. part 177). Under these regulations, which implement Title III of the Trade Agreements Act of 1979 (“TAA”), as amended (19 U.S.C. § 2511
This final determination concerns the country of origin of Merlin's VistA Imaging Tier II Storage Infrastructure Solution (“VistA Storage Solution”). We note that Merlin is a party-at-interest within the meaning of 19 C.F.R. § 177.22(d)(1) and is entitled to request this final determination.
You describe the pertinent facts as follows. The VistA Storage Solution is a record imaging, storage, and data retrieval system produced by Merlin in accordance with its contract with the Veterans Administration (“VA”). The VistA Storage Solution at issue contains a 24 TeraByte (“TB”) storage system.
Each VistA Storage Solution will consist of at least the following hardware components: two to four Cisco UCS C240 rack-mount servers (“Cisco Servers”); one or more NetApp E2600 series Fibre Channel storage arrays
You state that the Cisco Servers are produced in the United States and will provide the computing platform for the system. You state that the NetApp Storage Arrays are produced in the United States and will provide the data storage capability for the system. You state that the Cisco Network Switches are produced in the United States or China and will provide network connectivity for the system, enabling management access to the system's components, and user and application access to the system's data storage.
The Cisco Servers, NetApp Storage Arrays, and Cisco Network Switches will be interconnected by cables, mounted on a rack, and supplied electricity through power strips. You state that the cables, racks, and power strips (collectively, “Miscellaneous Components”) originate in various countries.
The Cisco Servers will be loaded with the following software: VMware vSphere 5 ESXi hypervisor software (“VMware”); Novell SuSE Linux Enterprise Server 11 (“Novell”); and, NetApp's StorageGRID software solution (“StorageGRID”).
You state that VMware was developed in the United States and it will enable the Cisco Servers to host three to six “virtual machines.” You state that Novell was developed in the United States and it will be the operating system software for the Cisco Servers. You state that StorageGRID was developed in Canada and it will protect images against data loss or corruption by maintaining multiple geographically separated replicas, by proactively and continuously checking integrity, and by self-healing to maintain resiliency in the event of corruption or failure. Additionally, you state that StorageGRID will provide the “virtual machines” with: an administration node for administrative access and control; a control node for metadata management and replication management of data objects; a storage node for stored objects; a standard gateway node for access to stored data; and, a primary gateway HA
You state the hardware components, with their standard features, lack the “grid” and “virtual machine” functions required by the VA Contract. You state that without VMWare and StorageGRID, it would be impossible for the VistA Storage Solution components to act together as part of a multi-site system (
The VistA Storage Solutions will be assembled in Virginia, United States by two of Merlin's subcontractors, Mission Mobility (“MM”) and NetApp Inc. (“NAI”). Once MM obtains the hardware from Merlin it will perform the first assembly process in about two days as follows:
1. Assembling the hardware onto racks, and connecting the individual pieces by cables;
2. Setting the server specifications for compatibility with VA's current document storage and retrieval system (VistA Imaging Tier II);
3. Configuring CIMC
4. Setting proper boot device and the connection to the server CIMC;
5. Connecting drives and media to the servers;
6. Entering the boot menu and configuring the server management IP address;
7. Loading the VMware on the servers;
8. Configuring the storage devices to accept StorageGRID; and,
9. Conducting tests to ensure the equipment operates properly.
After this first assembly, NAI will install the VistA Storage Solutions at individual VA sites in a final assembly process that takes about one to two weeks as follows:
1. Configuring the servers to permit them to communicate on the VISN, use StorageGRID, adjust the Network Time Protocol, deploy VMware templates, set up the vCenter Server Linux Virtual Appliance, and deploy the Open Virtualization Formats;
2. Mapping storage to hosts and creating raw device mapping to provide direct “virtual machine” access to storage devices;
3. Installing Novell on each “virtual machine” and building the nodes;
4. Installing StorageGRID; and,
5. Conducting tests and connecting the equipment to the VA computer network.
You also state that prior to the final assembly process by NAI, VA employees will remove preloaded firmware (incompatible with the VA Contract requirements) from the Cisco Network Switches and replace it with Cisco Systems firmware package that permits the Cisco Network Switches to operate in virtual mode. After the NAI installation activity, you state that VA technicians will update the Cisco Network Switches with the latest version of Cisco Systems' Internal Operating Software firmware, a United Stated developed firmware.
In an email, dated May 29, 2015, Merlin submitted information concerning the cost of each component, photographs of each hardware component and the installed components together, a workflow diagram of the system, and the VA Contract.
What is the country of origin of the VistAs for purposes of U.S. Government procurement?
Pursuant to Subpart B of Part 177, 19 C.F.R. 177.21
Under the rule of origin set forth under 19 U.S.C. § 2518(4)(B):
In rendering final determinations for purposes of U.S. Government Procurement, CBP applies the provisions of subpart B of Part 177 consistent with the Federal Procurement Regulations.
The Federal Acquisition Regulations define “U.S.-made end product” as:
With respect to the product under consideration in the instant case, we note that CBP has not previously considered whether the components at issue are substantially transformed when brought together in the manner set forth above. However, CBP has previously considered the substantial transformation of components into servers (
In order to determine whether a substantial transformation occurs when components of various origins are assembled to form completed articles, CBP considers the totality of the circumstances and makes such decisions on a case-by-case basis. The country of origin of the article's components, the extent of the processing that occurs within a given country, and whether such processing renders a product with a new name, character, and use are primary considerations in such cases. Additionally, facts such as resources expended on product design and development, extent and nature of post-assembly inspection procedures, and worker skill required during the actual manufacturing process will be considered when analyzing whether a substantial transformation has occurred; however, no one such factor is determinative. In this case, the determination will be “a mixed question of technology and customs law, mostly the latter.”
In HQ 735315, dated April 10, 1995, CBP considered whether three essential components (a U.S.-origin controlling computer, an Australian-origin optics module with a U.S.-origin printed wiring board assembly (“PWB”), and a U.S.-origin output device such as a printer) were substantially transformed into an optical spectroscopy instrument for purposes of U.S. Government procurement. In determining that the instrument was a product of the United States, it was noted that the majority of the components (the computer, PWB, and printer) and the added software were products of the United States, and their incorporation with the foreign optic module, rendered the instrument a product of the U.S. Similarly, in HQ 561734, dated March 22, 2001, CBP determined that certain multifunctional (printer, copier, and facsimile) machines assembled in Japan from 227 parts (108 from Japan, 92 from Thailand, and 24 from other countries) and eight Japanese subassemblies, were products of Japan for purposes of U.S. Government procurement. It was particularly noted that the Japanese-origin scanner subassembly was characterized as “the heart of the machine” in HQ 561734, which is similarly reflected with the U.S.-origin PWB in HQ 735315.
In this case, you state that there are six essential components, four from the United States, one from China, and one from Canada. From the VA Contract, the VistA Storage Solution appears to serve two purposes: (1) giving access to and automatically replicating stored data in the network; and (2) backing up data virtually in the case of any system failure. The VA Contract also notes that the VistA Storage Solution must be compatible with VA's VistA Imaging Tier II, a sophisticated and comprehensive electronic health record (“EHR(s)”) database system used by the VA's medical staff to store, retrieve, and manage documents at various VA locations.
At their basic levels, all six components provide essential qualities to support the purposes of the VA Contract; that is, the server will provide a computer operating structural function, the storage array will provide a storage structural function, the network switch will provide a connectivity structural function, VMware will provide the system with “virtual machine” capability, Novell will provide the system with an operating system, and StorageGRID will provide the system with capabilities that enhance its virtual functions and ensure data protection. However, the underlying basis of this product is the ability to store EHRs for their later use by the VA.
In determining whether the combining of parts or materials constitutes a substantial transformation, the determinative issue is the extent of operations performed and whether the parts lose their identity and become an integral part of the new article.
In HQ H125975, CBP held that an electronic data storage system that ensures data integrity and availability was a product of Mexico as a result of the assembly and programming operations that took place in Mexico. All of the systems hardware components were assembled into the final product in Mexico and its foreign-origin controller assembly, already assembled into the final product, was reprogrammed with software in Mexico. It was stated that the system could not function in its intended manner without the software.
This case considers a very similar product that will be assembled from subassemblies into its final form, loaded with software, and then configured to customer specifications, all in the same country. This process from assembly to configuration will start and end in the United States and may take more than two weeks to complete. According to the information submitted, the VistA Storage Solution cannot function in its intended manner without the downloaded software components. We also note there are various configuration tasks which take place throughout this process that are essential to the VA Contract purposes, such as configuring the servers to permit them to communicate on the VISN and deploy VMware, and mapping storage to hosts and creating raw device mapping to provide direct “virtual machines” access to storage devices. The
In
In C.S.D. 84-85, 18 Cust. B. & Dec. 1044, CBP stated:
It is claimed that Merlin will take several individual components and combine them in the United States to make an otherwise mere collection of hardware into a functional storage system, specifically compatible with the VA technology demands. These hardware components will not have pairing capability until the software components are downloaded, and it is claimed that their integration into the final product will impart the essential character of the VistA Storage Solution, substantially transforming the individual components that comprise it. In support, HQ H082476, dated May 11, 2010; HQ H034843, dated May 5, 2009; and, HQ H175415, dated October 4, 2011, are cited.
HQ H082476 held that a mass storage device was a product of the United because assembling 12 foreign-origin hardware components (a central processing unit, speed processing circuit, EEPROM, hard disk drive, memory module, etc.) and configuring them with U.S.-developed proprietary software, a process that took place entirely in the United States, constituted a substantial transformation. It was noted that the tariff classification of the assembled hardware without the software (8471.70.40, HTSUS) shifted
Similarly, the substantial transformation of components into servers, storage arrays, or network switches per HQ H215555, HQ H125975, and HQ H241177, as noted above, is well documented, relying on the same principles discussed in HQ H082476, HQ H034843, and HQ H175415. This suggests that the servers, storage arrays, and network switches, each and of themselves, already have a determined use and character prior to their assembly into a VistA Storage Solution. As HQ 732870 and HQ 734518 point out, when programming does not actually create a new or different product, it may not constitute a substantial transformation. Moreover, HQ 241177 notes certain “software downloading” does not amount to “programming” which “involves writing, testing and implementing code necessary to make a computer function a certain way.” Given these considerations, it would appear, for instance, that programming an imported, already functional, network switch just to customize its network compatibility, would not actually change the identity of the imported product as a network switch. However, the issue before us, with an end product that has functions and purposes beyond network connectivity, requires consideration beyond the function of one single component, but rather consideration of the integrated whole.
In HQ H090115, CBP held, based on a totality of the circumstances, that subassemblies manufactured in China (media servers, media gateways, circuit packs, and telephone sets) were substantially transformed into a “Unified Communications Solution” product of the United States. The United States processing, lasting about 16 days, included configuring the software to the end users requirements and integrating the hardware and software to work as one functional unit. It was particularly noted that the software was developed and maintained exclusively in the United States, and added functionality to certain individual components and changed the functionality of others.
In this case, you state there is only one foreign hardware component. Similar to HQ H090115, the foreign hardware component is assembled with other hardware components in the United States, loaded with software, and then configured to the end users requirements. This process occurs entirely in the United States, lasts about 16 days, and will also result in one functional unit. By integrating the network switch into the VistA Storage Solution, the result is not merely a network switch; rather, the network switch will be configured, per the added and customized software components, to specifically work with two other hardware components in a manner that permits storing and retrieving EHRs for a particular and complex medical network. The network switch, though it would be functional as a network switch prior to its assembly and configuration with the other components, would not be functional as the subject end product with its required purposes and functions.
Moreover, though HQ H090115 notes that the development of the software is also relevant, in this case you state that there are three software components, two developed in the United States and one in Canada, all of which will be installed and configured in the United States. Particularly, StorageGRID will be customized in the United States to be compatible with the hardware components and the networked system, the various nodes enabled by StorageGRID will be built during the assembly process in the United States, and the access to storage enabled by StorageGRID will be enabled in the United States by mapping the storage to the servers. As noted in the discussion above concerning
Therefore, only considering whether such processing renders a product with a new name, character, and use, and noting the manner in which the foreign hardware component and foreign software component are integrated to form an end product that functions differently than such components do on their own, we find that this factor weighs towards a United States country of origin determination for the VistA Storage Solution.
Aside from the factors above weighing towards a finding that the VistA Storage Solution is a product of the United States for purposes of U.S. Government Procurement, we note additional factors that lead to this conclusion. While changes in tariff classification are not determinative, the two foreign components, the Cisco Network Switch (8471.80.1000, HTSUS) and StorageGRID (8523, HTSUS), will change in tariff classification once configured and integrated into the final product (8471.70, HTSUS).
In summary, Merlin produces the VistA Storage Solution using six main components (three hardware components and three software components), from which only two components are of foreign-origin. The components will be combined, loaded with software, and then configured using skilled technical effort to design and reach the desired storage infrastructure for the VistA Storage Solution. The customization of the components and further installation of the software and firmware make what would otherwise be a non-functional rack storage unit into Merlin's proprietary networked storage system, the VistA Storage Solution. This process, from combining the two U.S.-origin hardware components and one foreign-origin hardware component to installing the two U.S.-origin software
Based on the facts provided, the hardware and software components will be substantially transformed through an assembly process that occurs entirely in the United States. As such, the VistA Storage Solution will be considered a product of the United States for purposes of U.S. Government procurement.
Notice of this final determination will be given in the
Transportation Security Administration, DHS.
30-day notice.
This notice announces that the Transportation Security Administration (TSA) has forwarded the Information Collection Request (ICR), Office of Management and Budget (OMB) control number 1652-0005, abstracted below to OMB for review and approval of an extension of the currently approved collection under the Paperwork Reduction Act (PRA). The ICR describes the nature of the information collection and its expected burden. TSA published a
Send your comments by August 21, 2015. A comment to OMB is most effective if OMB receives it within 30 days of publication.
Interested persons are invited to submit written comments on the proposed information collection to the Office of Information and Regulatory Affairs, OMB. Comments should be addressed to Desk Officer, Department of Homeland Security/TSA, and sent via electronic mail to
Christina A. Walsh, TSA PRA Officer, Office of Information Technology (OIT), TSA-11, Transportation Security Administration, 601 South 12th Street, Arlington, VA 20598-6011; telephone (571) 227-2062; email
In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 3501
(1) Evaluate whether the proposed information requirement is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility;
(2) Evaluate the accuracy of the agency's estimate of the burden;
(3) Enhance the quality, utility, and clarity of the information to be collected; and
(4) Minimize the burden of the collection of information on those who are to respond, including using appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology.
Fish and Wildlife Service, Interior.
Notice of availability; request for public comments; announcement of meeting.
We, the U.S. Fish and Wildlife Service (USFWS), in coordination with the California State Coastal Conservancy, announce the availability of a Draft Environmental Impact Statement/Environmental Impact Report (DEIS/EIR) for Phase 2 of the South Bay Salt Pond (SBSP) Restoration Project at the Don Edwards San Francisco Bay National Wildlife Refuge (Refuge) in Alameda, Santa Clara, and San Mateo Counties, California. The DEIS/EIR, which we prepared in accordance with the National Environmental Policy Act of 1969 (NEPA), describes and analyzes the alternatives identified for Phase 2 of the South Bay Salt Pond Restoration Project.
We will accept comments received or postmarked on or before September 22, 2015. A public meeting will be held on August 4, 2015 between 6 p.m. and 8 p.m. (see
Persons needing reasonable accommodations in order to attend and participate in the public meeting should contact Ariel Ambruster, by email at
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○ San Francisco Bay National Wildlife Refuge Complex Headquarters, 1 Marshlands Road, Fremont, CA 94555.
○ The following libraries:
Alviso Branch Library, 5050 N. First St., San Jose, CA 95002.
Biblioteca Latino America, 921 South First St., San Jose, CA 95110.
California State University Library, 25800 Carlos Bee Blvd., Hayward, CA 94542.
Fremont Main Library, 2400 Stevenson Blvd., Fremont, CA 94538.
Menlo Park Library, 800 Alma St., Menlo Park, CA 94025.
Mountain View Library, 585 Franklin St., Mountain View, CA 94041.
Rinconada Library, 1213 Newell Rd., Palo Alto, CA 94303.
King Library, 150 E San Fernando St., San Jose, CA 95112.
Redwood City Main Library, 1044 Middlefield Road, Redwood City, CA 94063.
San Mateo County East Palo Alto Library, 2415 University Ave., East Palo Alto, CA 94303.
Santa Clara County Milpitas Library, 160 N Main St., Milpitas, CA 95035.
Santa Clara Public Library, 2635 Homestead Rd., Santa Clara, CA 95051.
Sunnyvale Public Library, 665 W Olive Ave., Sunnyvale, CA 94086.
Natural Resources Library, U.S. Department of the Interior, 1849 C Street NW., Washington, DC 20240-0001.
For how to view comments on the draft EIS from the Environmental Protection Agency (EPA), or for information on EPA's role in the EIS process, see EPA's Role in the EIS Process under
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To have your name added to our mailing list, contact Ariel Ambruster (see
Anne Morkill, Project Leader, USFWS, 510-792-0222.
In coordination with the California State Coastal Conservancy, we publish this notice to announce the availability of a DEIS/EIR for Phase 2 of the SBSP Restoration Project at the Don Edwards San Francisco Bay Refuge in Alameda, Santa Clara, and San Mateo Counties, California. Phase 2 involves Ponds R3, R4, R5, S5, A1, A2W, A8, A8S, A19, A20, and A21. The DEIS/EIR, which we prepared in accordance with the National Environmental Policy Act of 1969 (NEPA), describes and analyzes the alternatives identified for Phase 2 of the SBSP Restoration Project. In addition to our publication of this notice, EPA is publishing a notice announcing the draft CCP and EIS, as required under section 309 of the Clean Air Act (42 U.S.C. 7401
The EPA is charged under section 309 of the CAA (42 U.S.C. 7401
EPA also serves as the repository (EIS database) for EISs prepared by Federal agencies and provides notice of their availability in the
The notice of availability is the start of the public comment period for draft EISs, and the start of the 30-day “wait period” for final EISs, during which agencies are generally required to wait 30 days before making a decision on a proposed action. For more information, see
In December 2007, the USFWS and the California Department of Fish and Wildlife (CDFW) published a Final EIS/EIR for the SBSP Restoration Project at the Don Edwards San Francisco Bay Refuge and the CDFW Eden Landing Ecological Reserve (December 28, 2007; 72 FR 73799). The overall south bay salt pond restoration area includes 15,100 acres that the USFWS and the CDFW acquired from Cargill, Inc. in 2003. The lands acquired from Cargill are divided into three pond complexes: The Ravenswood Pond Complex, in San Mateo County, managed by the USFWS; the Alviso Pond complex, also managed
In January 2008, we signed a Record of Decision selecting the Tidal Emphasis Alternative (Alternative C) for implementation. This alternative will result in 90 percent of the USFWS's ponds on the Refuge being restored to tidal wetlands and 10 percent converted to managed ponds. Under Phase 1 of Alternative C, we restored ponds E8A, E8X, E9, E12, and E13 at the Eden Landing complex; A6, A8, A16, and A17 at the Alviso complex; and SF2 at the Ravenswood complex. We also added several trails, interpretive features, and other recreational access points. Construction was completed on the USFWS ponds in 2013.
We now propose restoration or enhancement of over 2,000 acres of former salt ponds in the second phase of the SBSP Restoration Project. In Phase 2 DEIS/EIR, we provide project-level analysis of proposed restoration or enhancement of portions of the following three geographically separate pond clusters: The Ravenswood Pond Complex (R3, R4, R5, and S5), the Alviso Pond Complex-Mountain View Ponds (A1 and A2W), the Alviso Pond Complex-A8 Ponds (A8 and A8S), and the Alviso Pond Complex-Island Ponds (A19, A20, and A21). Some Phase 2 alternatives also include collaborative restoration and flood management activities with non-USFWS landowners of adjacent lands and managers of public infrastructures. Other Phase 2 alternatives do not include these components. These pond clusters are illustrated in Figures 1-5 on the SBSP Restoration Project Web site at
Phase 2 of the SBSP Restoration Project is intended to restore and enhance tidal wetlands and managed pond habitats in South San Francisco Bay while providing for flood management and wildlife-oriented public access and recreation. In this Phase 2 document, we would continue habitat restoration activities in both USFWS pond complexes, while also providing recreation and public access opportunities and maintaining or improving current levels of flood protection in the surrounding communities. Phase 2 actions are also being planned for implementation at the Eden Landing Pond Complex, which is owned and managed by the CDFW as part of the Eden Landing Wildlife Sanctuary, but these actions will be addressed under a separate process under the NEPA and California Environmental Quality Act (CEQA). We will address activities at other ponds in subsequent phases.
We consider a range of alternatives and their impacts in the DEIS/EIR, including No Action Alternatives for each group of ponds. The range of alternatives includes varying approaches to restoring tidal marshes (including number and location of breaches and other levee modifications), habitat enhancements (islands, transition zones, and channels), modifications to existing levees and berms to maintain or improve flood protection, and recreation and public access components (including trails, boardwalks, and viewing platforms) which correspond to the project objectives.
The alternatives for each group of ponds (“pond cluster”) are described below. The No Action Alternatives are described together, followed by the Action Alternatives that are under consideration for each pond cluster. In each group of ponds, each subsequently lettered alternative usually has successively more components and greater amounts of construction. Thus, at a given pond cluster, Alternative C would involve more components that Alternative B, which has more than Alternative A (No Action). One exception to this arrangement is at Ravenswood, where there are three Action Alternatives and where the defining feature of each alternative is not “more components versus fewer components” but rather a different restoration goal for some of the small ponds there.
Under Alternatives Island A, Mountain View A, A8 A, and Ravenswood A (the No Action Alternative at each of these pond clusters), no new activities would be implemented as part of Phase 2. The pond clusters would continue to be monitored and managed through the activities described in the Adaptive Management Plan (AMP) and in accordance with current USFWS practices.
Alternative Island B would breach Pond A19's northern levee and remove or lower levees between Ponds A19 and A20 to increase connectivity and improve the ecological function of both ponds.
Alternative Island C would include the components of Alternative Island B with the addition of levee breaches on the north sides of Ponds A20 and A21, lowering of portions of levees around Pond A20, pilot channels in Pond A19, and widening the existing breaches on the southern levee of Pond A19.
Under Alternative Mountain View B, Ponds A1 and A2W levees would be breached at several points to introduce tidal flow in the ponds. Portions of Pond A1's western levee would be built up to maintain current levels of flood protection provided by the pond itself. Habitat transition zones and habitat islands would be constructed in the ponds to increase habitat complexity and quality for special-status species. A new trail and viewing platform would be installed to improve recreation and public access at these ponds.
Under Alternative Mountain View C, levees would be breached and lowered to increase tidal flows in Pond A1, Pond A2W, and Charleston Slough. The inclusion of Charleston Slough (by breaching and lowering much of Pond A1's western levee) is the primary distinguishing feature between Alternative Mountain View B and Alternative Mountain View C. Several additional new trails and viewing platforms would be installed or replaced to improve recreation and public access at the pond cluster. To continue providing water to the City of Mountain View's Shoreline Park sailing lake, a new water intake would be constructed at the proposed breach between Pond A1 and Charleston Slough.
Alternative A8 B proposes the construction of habitat transition zones in Pond A8S's southwest corner, southeast corner, or both, depending on the amount of material available.
Alternative Ravenswood B would open Pond R4 to tidal flows, improve levees to provide additional flood protection, create habitat transition zone along the western edge of Pond R4, establish managed ponds to improve habitat for diving and dabbling birds, increase pond connectivity, and add a viewing platform to improve recreation and public access.
Alternative Ravenswood C would be similar to Alternative Ravenswood B, with the following exceptions: Ponds R5 and S5 would be converted to a particular type of managed pond that is operated to maintain intertidal mudflat elevation; water control structures would be installed on Pond R3 to allow for improvement to the habitat for western snowy plover; an additional habitat transition zone would be constructed; and two public access and recreational trails and additional viewing platforms would be constructed.
Alternative Ravenswood D would open Pond R4 to tidal flows, improve levees to provide additional flood protection, create two habitat transition zones in Pond R4, establish enhanced managed ponds in Ponds R5 and S5, increase pond connectivity, enhance Pond R3 for western snowy plover habitat, remove the levees within and between Ponds R5 and S5, and improve recreation and public access. Alternative Ravenswood D would also allow temporary stormwater detention into Ponds R5 and S5 via connections with the City of Redwood City's Bayfront Canal and Atherton Channel Project. This would treat a residual salinity problem in Ponds R5 and S5.
We are conducting environmental review in accordance with the requirements of NEPA, as amended (42 U.S.C. 4321
We request that you send comments only by one of the methods described in
In addition to providing written comments, the public is encouraged to attend a public meeting on August 4, 2015, to solicit comments on the DEIS/EIR. The location of the public meeting is provided in the
Bureau of Land Management, Interior.
Correction.
This action corrects the land description referenced in the
On page 7877, column 3, line 67 of the notice, which reads, “THENCE, North 89 degrees 25 minutes 53 seconds West, 3297.38 feet to a point on the North line of Section 21,” is hereby corrected to read, “THENCE, North 1 degree 20 minutes 28 seconds West, 3297.38 feet to a point on the North line of Section 21.”
National Park Service, Interior.
Request for nominations.
The National Park Service, U.S. Department of the Interior, is seeking nominations for individuals to be considered for appointment to the Star-Spangled Banner National Historic Trail Advisory Council.
Written nominations must be received by August 21, 2015.
Send nominations to: Chuck Grady, Chief of Administration, Fort McHenry National Monument & Historic Shrine, Hampton National Historic Site, Star-Spangled Banner National Historic Trail, 2400 East Fort Avenue, Baltimore, MD 21230, telephone (410) 962-4290, ext. 110, or via email at
Chuck Grady, Chief of Administration, Fort McHenry National Monument & Historic Shrine, Hampton National Historic Site, Star-Spangled Banner National Historic Trail, 2400 East Fort Avenue, Baltimore, MD 21230, telephone (410) 962-4290, ext. 110 or via email at
The Council was established under the National Trails System Act (16 U.S.C. 1241 to 1251, as amended). The purpose of the Council is to consult with the Secretary of the Interior on matters relating to the Star-Spangled Banner NHT, including but not limited to, the selection of rights-of-way, standards for the erection and maintenance of markers along the Trail, and interpretation and administration of the Trail.
The Council shall not exceed 35 members and will be appointed by the Secretary as follows:
a. The head of each Federal department or independent agency administering lands through which the trail route passes, or a designee;
b. A member to represent each State through which the trail passes, and such appointments will be made from recommendations of the Governors of such States; and
c. One or more members to represent private organizations, including corporate and individual landowners and land users, which, in the opinion of
Members are appointed for a term of two years. Some Council members may serve as Special Governmental Employees which requires the completion of an annual financial disclosure report and annual ethics training.
Members of the Council receive no pay, allowances, or benefits by reason of their service on the Council. However, while away from their homes or regular places of business in the performance of services for the Council as approved by the Designated Federal Officer (DFO), members may be allowed travel expenses, including per diem in lieu of subsistence, in the same manner as persons employed intermittently in Government service are allowed such expenses under section 5703 of Title 5 of the United State Code.
Individuals who are federally registered lobbyists are ineligible to serve on all FACA and non-FACA boards, committees, or councils in an individual capacity. The term “individual capacity” refers to individuals who are appointed to exercise their own individual best judgment on behalf of the government, such as when they are designated Special Government Employees, rather than being appointed to represent a particular interest.
Meetings will take place at such times as designated by the DFO. Members are expected to make every effort to attend all meetings. Members may not appoint deputies or alternates.
We are seeking nominations for Council members in all categories. The terms of the majority of the 22 members will expire on August 21, 2015. All those interested in membership, including current members whose terms are expiring, must follow the same nomination process. Nominations should include a resume providing an adequate description the nominee's qualifications, including information that would enable the Department of the Interior to make an informed decision regarding meeting the membership requirements of the Council, and to permit the Department to contact a potential member.
U.S. International Trade Commission.
Notice.
Notice is hereby given that the U.S. International Trade Commission has received a complaint entitled
Lisa R. Barton, Secretary to the Commission, U.S. International Trade Commission, 500 E Street SW., Washington, DC 20436, telephone (202) 205-2000. The public version of the complaint can be accessed on the Commission's Electronic Document Information System (EDIS) at EDIS,
General information concerning the Commission may also be obtained by accessing its Internet server at United States International Trade Commission (USITC) at USITC.
The Commission has received a complaint and a submission pursuant to section 210.8(b) of the Commission's Rules of Practice and Procedure filed on behalf of SawStop, LLC and SD3, LLC. on July 16, 2015. The complaint alleges violations of section 337 of the Tariff Act of 1930 (19 U.S.C. 1337) in the importation into the United States, the sale for importation, and the sale within the United States after importation of certain table saws incorporating active injury mitigation technology and components thereof. The complaint name as respondents Robert Bosch Tool Corporation of Mount Prospect, IL and Robert Bosch GmbH of Germany. The complainant requests that the Commission issue a permanent limited exclusion order, cease and desist orders, and a bond upon respondents' alleged infringing articles during the 60-day Presidential review period pursuant to 19 U.S.C. § 1337(j).
Proposed respondents, other interested parties, and members of the public are invited to file comments, not to exceed five (5) pages in length, inclusive of attachments, on any public interest issues raised by the complaint or section 210.8(b) filing. Comments should address whether issuance of the relief specifically requested by the complainant in this investigation would affect the public health and welfare in the United States, competitive conditions in the United States economy, the production of like or directly competitive articles in the United States, or United States consumers.
In particular, the Commission is interested in comments that:
(i) Explain how the articles potentially subject to the requested remedial orders are used in the United States;
(ii) identify any public health, safety, or welfare concerns in the United States relating to the requested remedial orders;
(iii) identify like or directly competitive articles that complainant, its licensees, or third parties make in the United States which could replace the subject articles if they were to be excluded;
(iv) indicate whether complainant, complainant's licensees, and/or third party suppliers have the capacity to replace the volume of articles potentially subject to the requested exclusion order and/or a cease and desist order within a commercially reasonable time; and
(v) explain how the requested remedial orders would impact United States consumers.
Written submissions must be filed no later than by close of business, eight calendar days after the date of publication of this notice in the
Persons filing written submissions must file the original document
Any person desiring to submit a document to the Commission in confidence must request confidential treatment. All such requests should be directed to the Secretary to the Commission and must include a full statement of the reasons why the Commission should grant such treatment.
This action is taken under the authority of section 337 of the Tariff Act of 1930, as amended (19 U.S.C. 1337), and of sections 201.10 and 210.8(c) of the Commission's Rules of Practice and Procedure (19 CFR 201.10, 210.8(c)).
By order of the Commission.
United States International Trade Commission.
Notice.
The Commission hereby gives notice of the scheduling of an expedited review pursuant to the Tariff Act of 1930 (“the Act”) to determine whether revocation of the antidumping duty order on chloropicrin from China would be likely to lead to continuation or recurrence of material injury within a reasonably foreseeable time.
Cynthia Trainor (202-205-3354), Office of Investigations, U.S. International Trade Commission, 500 E Street SW., Washington, DC 20436. Hearing-impaired persons can obtain information on this matter by contacting the Commission's TDD terminal on 202-205-1810. Persons with mobility impairments who will need special assistance in gaining access to the Commission should contact the Office of the Secretary at 202-205-2000. General information concerning the Commission may also be obtained by accessing its internet server (
For further information concerning the conduct of this review and rules of general application, consult the Commission's Rules of Practice and Procedure, part 201, subparts A and B (19 CFR part 201), and part 207, subparts A, D, E, and F (19 CFR part 207).
In accordance with sections 201.16(c) and 207.3 of the rules, each document filed by a party to the review must be served on all other parties to the review (as identified by either the public or BPI service list), and a certificate of service must be timely filed. The Secretary will not accept a document for filing without a certificate of service.
This review is being conducted under authority of title VII of the Tariff Act of 1930; this notice is published pursuant to section 207.62 of the Commission's rules.
By order of the Commission.
Notice is hereby given that, on June 26, 2015, pursuant to section 6(a) of the National Cooperative Research and Production Act of 1993, 15 U.S.C. 4301
No other changes have been made in either the membership or planned activity of the group research project. Membership in this group research project remains open, and PXI Systems Alliance, Inc. intends to file additional written notifications disclosing all changes in membership.
On November 22, 2000, PXI Systems Alliance, Inc. filed its original notification pursuant to section 6(a) of the Act. The Department of Justice published a notice in the
The last notification was filed with the Department on April 7, 2015. A notice was published in the
Notice is hereby given pursuant to the Antitrust Procedures and Penalties Act, 15 U.S.C. 16(b)-(h), that a proposed Final Judgment, Hold Separate Stipulation and Order, and Competitive Impact Statement have been filed with the United States District Court for the District of Columbia in
Copies of the Complaint, proposed Final Judgment, and Competitive Impact Statement are available for inspection at the Department of Justice, Antitrust Division, Antitrust Documents Group, 450 Fifth Street NW., Suite 1010, Washington, DC 20530 (telephone: 202-514-2481), on the Department of Justice's Web site at
Public comment is invited within 60 days of the date of this notice. Such comments, including the name of the submitter, and responses thereto, will be posted on the Department of Justice, Antitrust Division's internet Web site, filed with the Court and, under certain circumstances, published in the
The United States of America, acting under the direction of the Attorney General of the United States, brings this civil action to enjoin the proposed acquisition of Lincoln Financial Media Company (“Lincoln”) by Entercom Communications Corp. (“Entercom”), and to obtain other equitable relief. The acquisition likely would substantially lessen competition for the sale of radio advertising to advertisers targeting English-language listeners in the Denver, Colorado Metro Survey Area (“Denver MSA”), in violation of Section 7 of the Clayton Act, 15 U.S.C. 18. The United States alleges as follows:
1. By agreement, as amended and restated, dated December 7, 2014, between Lincoln National Life Insurance Company and Entercom, Entercom agreed to acquire Lincoln in a cash-and-stock deal for $105 million. Lincoln National Life Insurance Company is a subsidiary of Lincoln National Corporation.
2. Entercom and Lincoln own and operate broadcast radio stations in various locations throughout the United States, including a number of stations in Denver, Colorado. Entercom's and Lincoln's broadcast radio stations compete head-to-head for the business of local and national companies that seek to advertise on English-language broadcast radio stations in Denver, Colorado.
3. As alleged in greater detail below, the proposed acquisition would eliminate this substantial head-to-head competition in the Denver MSA and result in advertisers paying higher prices for radio advertising time in that market. Therefore, the proposed acquisition violates Section 7 of the Clayton Act, 15 U.S.C. 18, and should be enjoined.
4. The United States brings this action pursuant to Section 15 of the Clayton Act, as amended, 15 U.S.C. 25, to prevent and restrain Entercom and Lincoln from violating Section 7 of the Clayton Act, 15 U.S.C. 18. The Court has subject-matter jurisdiction over this action pursuant to Section 15 of the Clayton Act, 15 U.S.C. 25, and 28 U.S.C. 1331, 1337(a), and 1345.
5. Entercom and Lincoln are engaged in interstate commerce and in activities substantially affecting interstate commerce. They own and operate broadcast radio stations in various locations throughout the United States and sell radio advertising for those stations. Their radio advertising sales have had a substantial effect upon interstate commerce.
6. Entercom transacts business and is found in the District of Columbia and has also consented to venue in this District. Lincoln has consented to venue in this District. Venue is therefore proper in this District for both Entercom and Lincoln under Section 12 of the Clayton Act, 15 U.S.C. 22. Entercom and Lincoln have also consented to personal jurisdiction in this District.
7. Entercom, organized under the laws of Pennsylvania, with headquarters in Bala Cynwyd, Pennsylvania, is one of the largest radio broadcast companies in the United States. It has a nationwide portfolio of over 100 stations in 23 metropolitan areas. In 2014, Entercom reported net revenues of approximately $380 million.
8. Lincoln is an indirect, wholly owned subsidiary of Lincoln National Corporation. Lincoln is organized under the laws of North Carolina, with headquarters in Atlanta, Georgia. Lincoln owns and operates 15 broadcast radio stations in four metropolitan areas. In 2014, Lincoln had net revenues of approximately $69 million.
9. The relevant market for Section 7 of the Clayton Act is the sale of radio advertising time to advertisers targeting English-language listeners in the Denver MSA.
10. Entercom and Lincoln sell radio advertising time to local and national advertisers that target English-language listeners in the Denver MSA. An MSA is a geographical unit for which Nielsen Audio, a company that surveys radio listeners, furnishes radio stations, advertisers, and advertising agencies in a particular area with data to aid in evaluating radio audiences. MSAs are widely accepted by radio stations, advertisers, and advertising agencies as the standard geographic area to use in evaluating radio audience size and demographic composition. A radio station's advertising rates typically are based on the station's ability, relative to competing radio stations, to attract listening audiences that have certain demographic characteristics that advertisers want to reach.
11. Entercom and Lincoln radio stations in the Denver MSA generate almost all of their revenues by selling advertising time to local and national advertisers who want to reach listeners in the Denver MSA. Advertising placed on radio stations in an MSA is aimed at reaching listening audiences in that MSA, and radio stations outside that MSA do not provide effective access to these audiences.
12. Many local and national advertisers purchase radio advertising time because they find such advertising valuable, either by itself or as a complement to advertising on other media platforms. Reasons for this include the fact that radio advertising may be more cost-efficient and effective than other media at reaching the advertiser's target audience (individuals most likely to purchase the advertiser's products or services). In addition, radio stations offer certain services or promotional opportunities to advertisers that advertisers cannot obtain as effectively using other media.
13. Many local and national advertisers also consider English-language radio to be particularly effective or necessary to reach their desired customers. These advertisers consider English-language radio, either alone or as a complement to other media, to be the most effective way to reach their target audience, and do not consider other media, including non-English-language radio, such as Spanish-language radio, for example, to be a reasonable substitute.
14. If there were a small but significant and non-transitory increase in the price (“SSNIP”) of radio advertising time on English-language stations in the Denver MSA, advertisers would not reduce their purchases sufficiently to render the price increase unprofitable. Advertisers would not switch enough purchases of advertising time to radio stations outside the MSA, to other media, or to non-English-language stations to render the price increase unprofitable.
15. In addition, radio stations negotiate prices individually with advertisers; consequently, radio stations can charge different advertisers different prices. Radio stations generally can identify advertisers with strong preferences to advertise on radio in their MSAs. Because of this ability to price discriminate among customers, radio stations may charge higher prices to advertisers that view radio in their MSA as particularly effective for their needs, while maintaining lower prices for more price-sensitive advertisers. As a result, Entercom and Lincoln could profitably raise prices to those advertisers that view English-language radio targeting listeners in the Denver MSA as a necessary advertising medium.
16. Radio station ownership in the Denver MSA is highly concentrated. Entercom's and Lincoln's combined advertising revenue shares exceed 37 percent for English-language broadcast radio stations in the Denver MSA.
17. As articulated in the Horizontal Merger Guidelines issued by the Department of Justice and the Federal Trade Commission, the Herfindahl-Hirschman Index (“HHI”) is a measure of market concentration.
18. Concentration in the Denver MSA would increase significantly as a result of the proposed acquisition. The post-acquisition HHI in the Denver MSA would be over 3,500 for English-language broadcast radio stations. That HHI is well above the 2,500 threshold at which the Department normally considers a market to be highly concentrated. Entercom's proposed acquisition of Lincoln would result in a substantial increase in the HHI set forth above in excess of the 200 points presumed to be anticompetitive under the merger guidelines.
19. Advertisers that use radio to reach their target audiences select radio stations on which to advertise based upon a number of factors including, among others, the size and demographic composition of a station's audience, and the geographic reach of a station's
20. Entercom and Lincoln, each of which operates highly rated radio stations in the Denver MSA, are important competitors for English-language listeners in the Denver MSA. Moreover, Entercom and Lincoln each have multiple stations in the Denver MSA that seek to appeal to and attract the same listening audiences. For many local and national advertisers buying radio advertising time in the Denver MSA, the Entercom and Lincoln stations are close substitutes for each other based upon their specific audience characteristics.
21. During individual price negotiations between advertisers and radio stations, advertisers often provide the stations with information about their advertising needs, including their target audience and the desired frequency and timing of ads. Radio stations have the ability to charge advertisers differing rates based in part on the number and attractiveness of competitive radio stations that can meet a particular advertiser's specific target needs. During negotiations, advertisers that desire to reach a certain target audience and certain reach and frequency goals in the Denver MSA can gain more competitive rates by “playing off” Entercom stations, individually and collectively, against Lincoln stations, individually and collectively. The proposed acquisition would end that competition.
22. Post-acquisition, if Entercom raised prices or lowered services to those advertisers that buy advertising time on the Entercom and Lincoln stations in the Denver MSA, non-Entercom stations in that MSA, risking a significant loss of their existing audiences, would be unlikely to change their formats to attempt to attract the Entercom stations' audiences. Even if one or more non-Entercom stations changed their format, they would be unlikely to attract in a timely manner enough listeners to make a price increase or service reduction unprofitable for Entercom.
23. The entry of new radio stations into the Denver MSA would not be timely, likely, or sufficient to deter the exercise of market power.
24. The effect of the proposed acquisition of Lincoln by Entercom would be to lessen competition substantially in interstate trade and commerce in violation of Section 7 of the Clayton Act.
25. The United States hereby repeats and realleges the allegations of paragraphs 1 through 23 as if fully set forth herein.
26. Entercom's proposed acquisition of Lincoln would likely substantially lessen competition in interstate trade and commerce in violation of Section 7 of the Clayton Act, 15 U.S.C. § 18, and would likely have the following effects, among others:
a) competition in the sale of advertising time on English-language radio stations in the Denver MSA would be substantially lessened;
b) actual and potential competition in the Denver MSA between Entercom and Lincoln in the sale of radio advertising time would be eliminated; and
c) prices for advertising time on English-language radio stations in the Denver MSA would likely increase, and the quality of services would likely decline.
The United States requests:
a) That the Court adjudge the proposed acquisition to violate Section 7 of the Clayton Act, 15 U.S.C. § 18;
b) That the Court permanently enjoin and restrain the Defendants from carrying out the proposed acquisition or from entering into or carrying out any other agreement, understanding, or plan by which Lincoln would be acquired by, acquire, or merge with Entercom;
c) That the Court award the United States the costs of this action; and
d) That the Court award such other relief to the United States as the Court may deem just and proper.
Pursuant to Section 2(b) of the Antitrust Procedures and Penalties Act (“APPA” or “Tunney Act”), 15 U.S.C. § 16(b)-(h), plaintiff United States of America (“United States”) files this Competitive Impact Statement relating to the proposed Final Judgment submitted for entry in this civil antitrust proceeding.
Defendant Entercom Communications Corp. (“Entercom”) and Lincoln National Life Insurance Company, a subsidiary of Lincoln National Corporation, entered into a Purchase Agreement, as amended and restated, dated December 7, 2014, pursuant to which Entercom would acquire Defendant Lincoln Financial Media Company (“Lincoln”) for $105 million. Entercom's and Lincoln's broadcast radio stations compete head-to-head for the business of local and national companies that seek to advertise on English-language broadcast radio stations in the Denver, Colorado Metro Survey Area (“MSA”).
The United States filed a civil antitrust Complaint on July 14, 2015 seeking to enjoin the proposed acquisition. The Complaint alleges that the acquisition's likely effect would be to increase English-language broadcast radio advertising prices in the Denver MSA in violation of Section 7 of the Clayton Act, 15 U.S.C. 18.
At the same time the Complaint was filed, the United States also filed a Hold Separate Stipulation and Order (“Hold Separate”) and proposed Final Judgment, which are designed to eliminate the anticompetitive effects of the proposed acquisition. The proposed Final Judgment, which is explained more fully below, requires Defendants to divest the following broadcast radio stations (the “Divestiture Stations”) to an Acquirer approved by the United States in a manner that preserves competition in the Denver MSA: KOSI FM, KKFN FM, and KYGO FM. These three broadcast radio stations are
The United States and Defendants have stipulated that the proposed Final Judgment may be entered after compliance with the APPA. Entry of the proposed Final Judgment would terminate this action, except that the Court would retain jurisdiction to construe, modify, or enforce the provisions of the proposed Final Judgment and to punish violations thereof.
Entercom is incorporated in Pennsylvania, with its headquarters in Bala Cynwyd, Pennsylvania. Entercom owns and operates a nationwide portfolio of over 100 broadcast radio stations in 23 metropolitan areas, including the Denver MSA.
Lincoln is an indirect, wholly owned subsidiary of Lincoln National Corporation. Lincoln is organized under the laws of North Carolina, with headquarters in Atlanta, Georgia. Lincoln owns and operates 15 broadcast radio stations in four metropolitan areas, including the Denver MSA.
Pursuant to an agreement, as amended and restated, dated December 7, 2014, between Lincoln National Life Insurance Company and Entercom, Entercom agreed to acquire Lincoln in a cash-and-stock deal for $105 million. Lincoln National Life Insurance Company is a subsidiary of Lincoln National Corporation.
Entercom and Lincoln compete head-to-head against one another for the business of local and national advertisers that seek to purchase radio advertising time that targets English-language listeners located in the Denver MSA. The proposed acquisition would eliminate that competition.
The Complaint alleges that the sale of broadcast radio advertising time to advertisers targeting English-language listeners located in the Denver MSA constitutes a relevant product market for analyzing this acquisition under Section 7 of the Clayton Act. Entercom and Lincoln sell radio advertising time to local and national advertisers that seek to target English-language listeners in the Denver MSA. An MSA is a geographical unit for which Nielson Audio, a company that surveys radio listeners, furnishes radio stations, advertisers, and advertising agencies in a particular area with data to aid in evaluating radio audiences. MSAs are widely accepted by radio stations, advertisers, and advertising agencies as the standard geographic area to use in evaluating radio audience size and demographic composition. A radio station's advertising rates typically are based on the station's ability, relative to competing radio stations, to attract listening audiences that have certain demographic characteristics that advertisers want to reach.
Entercom and Lincoln broadcast radio stations in the Denver MSA generate almost all of their revenues by selling advertising time to local and national advertisers who want to reach listeners present in that MSA. Advertising placed on radio stations in an MSA is aimed at reaching listening audiences in that MSA, and radio stations outside that MSA do not provide effective access to these audiences.
Many local and national advertisers purchase radio advertising time because they find such advertising valuable, either by itself or as a complement to advertising on other media platforms. For such advertisers, radio time (a) may be less expensive and more cost-efficient than other media in reaching the advertiser's target audience (individuals most likely to purchase the advertiser's products or services); or (b) may offer promotional opportunities to advertisers that they cannot replicate as effectively using other media. For these and other reasons, many local and national advertisers who purchase radio advertising time view radio as a necessary advertising medium for them or as a necessary advertising complement to other media.
Many local and national advertisers also consider English-language radio to be particularly effective or necessary to reach their desired customers. These advertisers consider English-language radio, either alone or as a complement to other media, to be the most effective way to reach their target audience, and do not consider other media, including non-English-language radio, such as Spanish-language radio, for example, to be a reasonable substitute.
If there were a small but significant and non-transitory increase in the price (“SSNIP”) on radio advertising time on English-language stations in the Denver MSA, advertisers would not reduce their purchases sufficiently to render the price increase unprofitable. Advertisers would not switch enough purchases of advertising time to radio stations outside the MSA, to other media, or to non-English-language stations to render the price increase unprofitable.
In addition, radio stations negotiate prices individually with advertisers; consequently, radio stations can charge different advertisers different prices. Radio stations generally can identify advertisers with strong preferences to advertise on radio in their MSAs. Because of this ability to price discriminate among customers, radio stations may charge higher prices to advertisers that view radio in their MSA as particularly effective for their needs, while maintaining lower prices for more price-sensitive advertisers. As a result, Entercom and Lincoln could profitably raise prices to those advertisers that view English-language radio that targets listeners in the Denver MSA as a necessary advertising medium.
The Complaint alleges that the proposed acquisition likely would lessen competition substantially in interstate trade and commerce, in violation of Section 7 of the Clayton Act, 15 U.S.C. 18, and likely would have the following effects, among others:
a) competition in the sale of broadcast radio advertising on English-language radio stations in the Denver MSA would be lessened substantially;
b) competition between Entercom broadcast radio stations and Lincoln broadcast radio stations in the sale of broadcast radio advertising in the Denver MSA would be eliminated; and
c) the prices for advertising time on English-language broadcast radio stations in the Denver MSA likely would increase.
The acquisition, by eliminating Lincoln as a separate competitor and combining its operations with Entercom's, would allow Entercom to increase its share of the broadcast radio advertising revenues in the Denver MSA. In the Denver MSA, combining the Entercom and Lincoln broadcast radio stations would give Entercom approximately 37 percent of advertising sales on English-language broadcast radio stations.
Entercom's acquisition of Lincoln also would further concentrate an already highly concentrated broadcast radio market in the Denver MSA. Using the Herfindahl-Hirschman Index (“HHI”), a
Furthermore, the transaction combines stations and station groups that are close substitutes and vigorous head-to-head competitors for advertisers seeking to reach specific English-language audiences in the Denver MSA. Advertisers select radio stations to reach a large percentage of their target audience based upon a number of factors, including,
During individual price negotiations between advertisers and radio stations, advertisers often provide the stations with information about their advertising needs, including their target audience and the desired frequency and timing of their advertisements. Radio stations have the ability to charge advertisers differing rates based in part on the number and attractiveness of competitive radio stations that can meet a particular advertiser's audience, reach, and frequency needs. During negotiations, advertisers that desire to reach a certain target audience and certain reach and frequency goals in the Denver MSA can gain more competitive rates by “playing off” Entercom stations, individually and collectively, against Lincoln stations, individually and collectively. The proposed acquisition would end that competition.
Post-acquisition, if Entercom raised prices or lowered services to those advertisers that buy advertising time on the Entercom and Lincoln stations in the Denver MSA, non-Entercom stations in that MSA, risking a significant loss of their existing audiences, would be unlikely to change their formats to attempt to attract the Entercom stations' audiences. Even if one or more non-Entercom stations changed their format, they would be unlikely to attract in a timely manner enough listeners to make a price increase or service reduction unprofitable for Entercom. Finally, the entry of new radio stations into the Denver MSA would not be timely, likely, or sufficient to deter the exercise of market power.
For all these reasons, the Complaint alleges that Entercom's proposed acquisition of Lincoln would lessen competition substantially in the sale of radio advertising time to advertisers targeting English-language listeners in the Denver MSA, eliminate head-to-head competition between Entercom and Lincoln stations in the Denver MSA, and result in increased prices and reduced quality of service for radio advertisers in that MSA, all in violation of Section 7 of the Clayton Act.
The divestiture requirement of the proposed Final Judgment will eliminate the anticompetitive effects of the acquisition in the Denver MSA by maintaining the Divestiture Stations as independent, economically viable competitors. The proposed Final Judgment requires Entercom to divest the following broadcast radio stations located in the Denver MSA to Bonneville International Corporation: KOSI FM, KKFN FM, and KYGO FM. The United States has approved this divestiture buyer. The Antitrust Division required Entercom to identify the Acquirer of the Divestiture Stations in order to provide greater certainty and efficiency in the divestiture process.
The “Divestiture Assets” are defined in Paragraph II.H of the proposed Final Judgment to cover all assets, tangible or intangible, principally devoted to and necessary for the operation of the Divestiture Stations as viable, ongoing commercial broadcast radio stations. With respect to each Divestiture Station, the divestiture will include assets sufficient to satisfy the United States, in its sole discretion, that such assets can and will be used to operate each station as a viable, ongoing, commercial radio business.
To ensure that the Divestiture Stations are operated independently from Entercom after the divestiture, Sections IV and XI of the proposed Final Judgment prohibit Defendants from entering into any agreements during the term of the Final Judgment that create a long-term relationship with or any entanglements that affect competition between either Defendant and the Acquirer of the Divestiture Stations concerning the Divestiture Assets after the divestiture is completed. Examples of prohibited agreements include agreements to reacquire any part of the Divestiture Assets, agreements to acquire any option to reacquire any part of the Divestiture Assets or to assign the Divestiture Assets to any other person, agreements to enter into any time brokerage agreement, local marketing agreement, joint sales agreement, other cooperative selling arrangement, or shared services agreement, or agreements to conduct other business negotiations jointly with the Acquirer(s) with respect to the Divestiture Assets, or providing financing or guarantees of financing with respect to the Divestiture Assets, during the term of this Final Judgment. The shared services prohibition does not preclude Defendants from continuing or entering into any non-sales-related shared services agreement that is approved in advance by the United States in its sole discretion. The time brokerage agreement prohibition does not preclude Defendants from entering into an agreement pursuant to which Bonneville can begin operating KOSI FM, KKFN FM, and KYGO FM immediately after the Court's approval of the Hold Separate Stipulation and Order in this matter, so long as the agreement with Bonneville expires upon the consummation of a final agreement to divest the Divestiture Assets to Bonneville.
Defendants are required to take all steps reasonably necessary to accomplish the divestiture quickly and to cooperate with prospective purchasers. Because transferring the broadcast license for each of the Divestiture Stations requires FCC approval, Defendants are specifically required to use their best efforts to obtain all necessary FCC approvals as expeditiously as possible. The divestiture of each of the Divestiture Stations must occur within 90 calendar days after the filing of the Hold Separate Stipulation and Order in this matter, subject to extension during the pendency of any necessary FCC order pertaining to the divestiture. The United States, in its sole discretion, may agree to one or more extensions of this time period not to exceed ninety (90) calendar days in total, and shall notify the Court in such circumstances.
In the event that Defendants do not accomplish the divestitures the periods
Section 4 of the Clayton Act, 15 U.S.C. §“15, provides that any person who has been injured as a result of conduct prohibited by the antitrust laws may bring suit in federal court to recover three times the damages the person has suffered, as well as costs and reasonable attorneys' fees. Entry of the proposed Final Judgment will neither impair nor assist the bringing of any private antitrust damage action. Under the provisions of Section 5(a) of the Clayton Act, 15 U.S.C. § 16(a), the proposed Final Judgment has no prima facie effect in any subsequent private lawsuit that may be brought against Defendants.
The United States and Defendants have stipulated that the proposed Final Judgment may be entered by the Court after compliance with the provisions of the APPA, provided that the United States has not withdrawn its consent. The APPA conditions entry upon the Court's determination that the proposed Final Judgment is in the public interest.
The APPA provides a period of at least sixty (60) days preceding the effective date of the proposed Final Judgment within which any person may submit to the United States written comments regarding the proposed Final Judgment. Any person who wishes to comment should do so within sixty (60) days of the date of publication of this Competitive Impact Statement in the
Written comments should be submitted to:
The proposed Final Judgment provides that the Court retains jurisdiction over this action, and Defendants may apply to the Court for any order necessary or appropriate for the modification, interpretation, or enforcement of the Final Judgment.
The United States considered, as an alternative to the proposed Final Judgment, a full trial on the merits against Defendants. The United States could have continued the litigation and sought preliminary and permanent injunctions against Entercom's acquisition of Lincoln. The United States is satisfied, however, that the divestiture of assets described in the proposed Final Judgment will preserve competition for the sale of English-language broadcast radio advertising in the Denver MSA. Thus, the proposed Final Judgment would achieve all or substantially all of the relief the United States would have obtained through litigation, but avoids the time, expense, and uncertainty of a full trial on the merits of the Complaint.
The Clayton Act, as amended by the APPA, requires that proposed consent judgments in antitrust cases brought by the United States be subject to a sixty-day comment period, after which the court shall determine whether entry of the proposed Final Judgment “is in the public interest.” 15 U.S.C. 16(e)(1). In making that determination, the court, in accordance with the statute as amended in 2004, is required to consider:
(A) the competitive impact of such judgment, including termination of alleged violations, provisions for enforcement and modification, duration of relief sought, anticipated effects of alternative remedies actually considered, whether its terms are ambiguous, and any other competitive considerations bearing upon the adequacy of such judgment that the court deems necessary to a determination of whether the consent judgment is in the public interest; and
(B) the impact of entry of such judgment upon competition in the relevant market or markets, upon the public generally and individuals alleging specific injury from the violations set forth in the complaint including consideration of the public benefit, if any, to be derived from a determination of the issues at trial.
15 U.S.C. 16(e)(1)(A) & (B). In considering these statutory factors, the court's inquiry is necessarily a limited one as the government is entitled to “broad discretion to settle with the defendant within the reaches of the public interest.”
As the United States Court of Appeals for the District of Columbia Circuit has held, under the APPA a court considers,
Courts have greater flexibility in approving proposed consent decrees than in crafting their own decrees following a finding of liability in a litigated matter. “[A] proposed decree must be approved even if it falls short of the remedy the court would impose on its own, as long as it falls within the range of acceptability or is `within the reaches of public interest.' ”
Moreover, the court's role under the APPA is limited to reviewing the remedy in relationship to the violations that the United States has alleged in its Complaint, and does not authorize the court to “construct [its] own hypothetical case and then evaluate the decree against that case.”
In its 2004 amendments, Congress made clear its intent to preserve the practical benefits of utilizing consent decrees in antitrust enforcement, adding the unambiguous instruction that “[n]othing in this section shall be construed to require the court to conduct an evidentiary hearing or to require the court to permit anyone to intervene.” 15 U.S.C. 16(e)(2);
There are no determinative materials or documents within the meaning of the APPA that were considered by the United States in formulating the proposed Final Judgment.
The term “HHI” means the Herfindahl-Hirschman Index, a commonly accepted measure of market concentration. The HHI is calculated by squaring the market share of each firm competing in the market and then summing the resulting numbers. For example, for a market consisting of four firms with shares of 30, 30, 20, and 20 percent, the HHI is 2,600 (30
Markets in which the HHI is between 1,500 and 2,500 points are considered to be moderately concentrated, and markets in which the HHI is in excess of 2,500 points are considered to be highly concentrated.
WHEREAS, plaintiff, the United States of America filed its Complaint on July 14, 2015, and plaintiff and Entercom Communications Corp. (“Entercom”) and Lincoln Financial Media Company (“Lincoln”), by their respective attorneys, have consented to the entry of this Final Judgment without trial or adjudication of any issue of fact or law herein, and without this Final Judgment constituting any evidence against or an admission by any party with respect to any issue of law or fact herein;
AND WHEREAS, defendants have agreed to be bound by the provisions of this Final Judgment pending its approval by the Court;
AND WHEREAS, the essence of this Final Judgment is the prompt and certain divestiture of certain rights and assets by the defendants to assure that competition is not substantially lessened;
AND WHEREAS, the United States requires defendants to make certain divestitures for the purpose of remedying the loss of competition alleged in the Complaint;
AND WHEREAS, defendants have represented to the United States that the divestitures required below can and will be made, and that defendants will later raise no claim of hardship or difficulty as grounds for asking the Court to modify any of the divestiture provisions contained below;
NOW THEREFORE, before any testimony is taken, without trial or adjudication of any issue of fact or law, and upon consent of the parties, it is hereby ORDERED, ADJUDGED, and DECREED:
This Court has jurisdiction over each of the parties hereto and over the subject matter of this action. The Complaint states a claim upon which relief may be granted against defendants under Section 7 of the Clayton Act, as amended, 15 U.S.C. 18.
As used in this Final Judgment:
A. “Entercom” means defendant Entercom Communications Corp., a Pennsylvania corporation headquartered in Bala Cynwyd, Pennsylvania, its successors and assigns, and its subsidiaries, divisions, groups, affiliates, partnerships, and joint ventures, and their directors, officers, managers, agents, and employees.
B. “Lincoln” means defendant Lincoln Financial Media Company, a North Carolina corporation headquartered in Atlanta, Georgia, its successors and assigns, and its subsidiaries, divisions, groups, affiliates, partnerships, and joint ventures, and their directors, officers, managers, agents, and employees.
C. “Acquirer” means Bonneville International Corporation, or another entity to which the defendants divest any Divestiture Assets.
D. “MSA” means Metropolitan Survey Area as defined by A.C. Nielsen Company and used by the
E. “KOSI FM” means the broadcast radio station located in the Denver, Colorado MSA owned by defendant Entercom.
F. “KKFN FM” means the broadcast radio station located in the Denver, Colorado MSA owned by defendant Lincoln.
G. “KYGO FM” means the broadcast radio station located in the Denver, Colorado MSA owned by defendant Lincoln.
H. “Divestiture Assets” means all of the assets, tangible or intangible, principally devoted to and necessary for the operations of KOSI FM, KKFN FM and KYGO FM as viable, ongoing commercial broadcast radio stations, except as otherwise agreed to in writing by the United States Department of Justice, including, but not limited to, all real property (owned or leased) principally devoted to and necessary for the operation of the stations, all broadcast equipment, office equipment, office furniture, fixtures, materials, supplies, and other tangible property principally devoted to and necessary for the operation of the stations; all licenses, permits, authorizations, and applications therefore issued by the Federal Communications Commission (“FCC”) and other government agencies related to the stations; all contracts (including programming contracts and rights), agreements, network agreements, leases, and commitments and understandings of Defendants principally devoted to and necessary for the operation of the stations; all trademarks, service marks, trade names, copyrights, patents, slogans, programming materials, and promotional materials relating to the stations; all customer lists, contracts, accounts, and credit records; all logs and other records maintained by Defendants in connection with the stations; and rights (pursuant to a lease or other agreement acceptable to the United States in its sole discretion) to transmission facilities necessary for the operations of KOSI FM, KKFN FM and KYGO FM.
A. This Final Judgment applies to Entercom and Lincoln as defined above, and all other persons in active concert or participation with any of them who receive actual notice of this Final Judgment by personal service or otherwise.
B. If, prior to complying with Sections IV and V of this Final Judgment, defendants sell or otherwise dispose of all or substantially all of their assets or of lesser business units that include the defendants' Divestiture Assets, they shall require the purchaser to be bound by the provisions of this Final Judgment. Defendants need not obtain such an agreement from the Acquirer(s) of assets divested pursuant to the Final Judgment.
A. Defendants are ordered and directed, within ninety (90) calendar days after the filing of the Hold Separate Stipulation and Order in this matter, to divest the Divestiture Assets to an Acquirer or Acquirers acceptable to the United States, in its sole discretion. The United States, in its sole discretion, may agree to one or more extensions of this time period not to exceed ninety (90) calendar days in total, and shall notify the Court in such circumstances. With respect to divestiture of the Divestiture Assets by defendants or the trustee appointed pursuant to Section V of this Final Judgment, if applications have been filed with the FCC within the period permitted for divestiture seeking approval to assign or transfer licenses to the Acquirer(s) of the Divestiture Assets, but an order or other dispositive action by the FCC on such applications has not been issued before the end of the period permitted for divestiture, the period shall be extended with respect to divestiture of the Divestiture Assets for which no FCC order has issued no later than ten (10) business days after the order of the FCC consenting to the assignment of the Divestiture Assets to Bonneville has become final. Entercom shall use its best efforts to accomplish the divestitures ordered by this Final Judgment as expeditiously as possible, including using its best efforts to obtain all necessary FCC approvals as expeditiously as possible. This Final Judgment does not limit the FCC's exercise of its regulatory powers and process with respect to the Divestiture Assets. Authorization by the FCC to conduct the divestiture of a Divestiture Asset in a particular manner will not modify any of the requirements of this Final Judgment.
B. In the event that defendants are attempting to divest assets related to KOSI FM, KKFN FM or KYGO FM to an Acquirer other than Bonneville:
(1) Defendants promptly shall make known, by usual and customary means, the availability of the Divestiture Assets;
(2) Defendants shall inform any person making inquiry regarding a possible purchase of the Divestiture Assets that they are being divested pursuant to this Final Judgment and provide that person with a copy of this Final Judgment;
(3) Defendants shall offer to furnish to all bona fide prospective acquirers, subject to customary confidentiality assurances, all information and documents relating to the Divestiture Assets customarily provided in a due diligence process except such information or documents subject to the attorney-client privilege or work-product doctrine; and
(4) Defendants shall make available such information to the United States at the same time that such information is made available to any other person.
C. Defendants shall provide the Acquirer(s) and the United States information relating to the personnel involved in and necessary to the operation or management of the Divestiture Assets to enable the Acquirer(s) to make offers of employment. Defendants shall not interfere with any negotiations by the Acquirer(s) to employ or contract with any employee of any defendant who is involved in and necessary to the operation or management of the Divestiture Assets.
D. Defendants shall permit the Acquirer(s) of the Divestiture Assets to have reasonable access to personnel and to make inspections of the physical facilities of KOSI FM, KKFN FM and KYGO FM; access to any and all environmental, zoning, and other permit documents and information; and access to any and all financial, operational, or other documents and information customarily provided as part of a due diligence process.
E. Entercom shall warrant to the Acquirer(s) that each Divestiture Asset will be operational on the date of sale.
F. Defendants shall not take any action that will impede in any way the permitting, operation, or divestiture of the Divestiture Assets.
G. Entercom shall warrant to the Acquirer(s) that there are no material defects in the environmental, zoning, or other permits pertaining to the operation of each Divestiture Asset, and that, following the sale of the Divestiture Assets, defendants will not undertake, directly or indirectly, any challenges to the environmental, zoning, or other permits relating to the operation of the Divestiture Assets.
H. The foregoing Sections IV.C through IV.G shall not apply in the event that the acquirer of the Divestiture Assets is Bonneville pursuant to the Asset Exchange Agreement dated as of July 10, 2015, by and among Entercom Radio, LLC, Entercom License, LLC, Entercom Denver, LLC, Entercom California, LLC, and Bonneville International Coprporation, and, as of the Closing, Lincoln Financial Media Company.
I. Unless the United States otherwise consents in writing, the divestiture pursuant to Section IV, or by trustee appointed pursuant to Section V of this Final Judgment, shall include the entire Divestiture Assets and be accomplished in such a way as to satisfy the United States, in its sole discretion, that the Divestiture Assets can and will be used by the Acquirer(s) as part of a viable, ongoing commercial radio broadcasting business, and the divestiture of such assets will achieve the purposes of this Final Judgment and remedy the competitive harm alleged in the Complaint. The divestitures, whether pursuant to Section IV or Section V of this Final Judgment:
(1) shall be made to an Acquirer or Acquirers that, in the United States' sole judgment, has the intent and capability (including the necessary managerial, operational, technical, and financial capability) of competing effectively in the commercial radio broadcasting business; and
(2) shall be accomplished so as to satisfy the United States, in its sole discretion, that none of the terms of any agreement between an Acquirer and defendants gives defendants the ability unreasonably to raise any Acquirer's costs, to lower any Acquirer's efficiency, or otherwise to interfere in the ability of any Acquirer to compete effectively.
A. If defendants have not divested the Divestiture Assets within the time period specified in Section IV(A), defendants shall notify the United States of that fact in writing. Upon application of the United States, the Court shall appoint a Divestiture Trustee selected by the United States and approved by the Court to effect the divestiture of the Divestiture Assets.
B. After the appointment of a Divestiture Trustee becomes effective, only the trustee shall have the right to sell the Divestiture Assets. The Divestiture Trustee shall have the power and authority to accomplish the divestiture to an Acquirer(s) acceptable
C. Defendants shall not object to a sale by the trustee on any ground other than the trustee's malfeasance. Any such objections by defendants must be conveyed in writing to the United States and the Divestiture Trustee within ten (10) calendar days after the trustee has provided the notice required under Section VI.
D. The Divestiture Trustee shall serve at the cost and expense of defendants pursuant to a written agreement, on such terms and conditions as the United States approves, including confidentiality requirements and conflict-of-interest certifications. The trustee shall account for all monies derived from its sale of the Divestiture Assets and all costs and expenses so incurred. After approval by the Court of the trustee's accounting, including fees for its services yet unpaid and those of any professionals and agents retained by the trustee, all remaining money shall be paid to defendants and the trust shall then be terminated. The compensation of the Divestiture Trustee and any professionals and agents retained by the trustee shall be reasonable in light of the value of the Divestiture Assets and based on a fee arrangement providing the trustee with an incentive based on the price and terms of the divestiture and the speed with which it is accomplished, but timeliness is paramount. If the Divestiture Trustee and defendants are unable to reach agreement on the trustee's or any agents' or consultants' compensation or other terms and conditions of engagement within 14 calendar days of appointment of the trustee, the United States may, in its sole discretion, take appropriate action, including making a recommendation to the Court. The Divestiture Trustee shall, within three (3) business days of hiring any other professionals or agents, provide written notice of such hiring and the rate of compensation to defendants and the United States.
E. Defendants shall use their best efforts to assist the Divestiture Trustee in accomplishing the required divestiture. The Divestiture Trustee and any consultants, accountants, attorneys, and other agents retained by the trustee shall have full and complete access to the personnel, books, records, and facilities of the business to be divested, and defendants shall develop financial and other information relevant to such business as the trustee may reasonably request, subject to reasonable protection for trade secret or other confidential research, development, or commercial information or any applicable privileges. Defendants shall take no action to interfere with or to impede the Divestiture Trustee's accomplishment of the divestiture.
F. After its appointment, the Divestiture Trustee shall file monthly reports with the United States and, as appropriate, the Court setting forth the trustee's efforts to accomplish the divestiture ordered under this Final Judgment. To the extent such reports contain information that the Divestiture Trustee deems confidential, such reports shall not be filed in the public docket of the Court. Such reports shall include the name, address, and telephone number of each person who, during the preceding month, made an offer to acquire, expressed an interest in acquiring, entered into negotiations to acquire, or was contacted or made an inquiry about acquiring, any interest in the Divestiture Assets, and shall describe in detail each contact with any such person. The Divestiture Trustee shall maintain full records of all efforts made to divest the Divestiture Assets.
G. If the Divestiture Trustee has not accomplished the divestiture ordered under this Final Judgment within six months after its appointment, the trustee shall promptly file with the Court a report setting forth (1) the trustee's efforts to accomplish the required divestiture, (2) the reasons, in the trustee's judgment, why the required divestiture has not been accomplished, and (3) the trustee's recommendations. To the extent such report contains information that the Divestiture Trustee deems confidential, such report shall not be filed in the public docket of the Court. The Divestiture Trustee shall at the same time furnish such report to the United States which shall have the right to make additional recommendations consistent with the purpose of the trust. The Court thereafter shall enter such orders as it shall deem appropriate to carry out the purpose of the Final Judgment, which may, if necessary, include extending the trust and the term of the Divestiture Trustee's appointment by a period requested by the United States.
H. If the United States determines that the Divestiture Trustee has ceased to act or failed to act diligently or in a reasonably cost-effective manner, it may recommend the Court appoint a substitute Divestiture Trustee.
A. Within two (2) business days following execution of a definitive divestiture agreement, defendants or the Divestiture Trustee, whichever is then responsible for effecting the divestiture required herein, shall notify the United States of any proposed divestiture required by Section IV or V of this Final Judgment. If the Divestiture Trustee is responsible, it shall similarly notify defendants. The notice shall set forth the details of the proposed divestiture and list the name, address, and telephone number of each person not previously identified who offered or expressed an interest in or desire to acquire any ownership interest in the Divestiture Assets, together with full details of the same.
B. Within fifteen (15) calendar days of receipt by the United States of such notice, the United States may request from defendants, the proposed Acquirer(s), any other third party, or the Divestiture Trustee, if applicable, additional information concerning the proposed divestiture(s), the proposed Acquirer(s), and any other potential Acquirer. Defendants and the Divestiture Trustee shall furnish any additional information requested within fifteen (15) calendar days of the receipt of the request, unless the parties shall otherwise agree.
C. Within thirty (30) calendar days after receipt of the notice or within twenty (20) calendar days after the United States has been provided the additional information requested from defendants, the proposed Acquirer(s), any third party, and the Divestiture Trustee, whichever is later, the United States shall provide written notice to defendants and the trustee, if there is one, stating whether or not it objects to the proposed divestiture. If the United States provides written notice that it does not object, the divestiture may be consummated, subject only to defendants' limited right to object to the sale under Section V(C) of this Final Judgment. Absent written notice that the United States does not object to the proposed Acquirer(s) or upon objection by the United States, a divestiture proposed under Section IV or Section V
Defendants shall not finance all or any part of any purchase made pursuant to Section IV or V of this Final Judgment.
Until the divestiture required by this Final Judgment has been accomplished, defendants shall take all steps necessary to comply with the Hold Separate Stipulation and Order entered by this Court. Defendants shall take no action that would jeopardize the divestiture ordered by this Court.
A. Within twenty (20) calendar days of the filing of the Complaint in this matter, and every thirty (30) calendar days thereafter until the divestiture has been completed under Section IV or V of this Final Judgment, defendants shall deliver to the United States an affidavit as to the fact and manner of their compliance with Section IV or V of this Final Judgment. Each such affidavit shall include the name, address, and telephone number of each person who, during the preceding thirty (30) days, made an offer to acquire, expressed an interest in acquiring, entered into negotiations to acquire, or was contacted or made an inquiry about acquiring, any interest in the Divestiture Assets, and shall describe in detail each contact with any such person during that period. Each such affidavit shall also include a description of the efforts defendants have taken to solicit buyers for and complete the sale of the Divestiture Assets, including efforts to secure FCC or other regulatory approvals, and to provide required information to prospective acquirers, including the limitations, if any, on such information. Assuming the information set forth in the affidavit is true and complete, any objection by the United States to information provided by defendants, including limitations on information, shall be made within fourteen (14) days of receipt of such affidavit.
B. Within twenty (20) calendar days of the filing of the Complaint in this matter, each defendant shall deliver to the United States an affidavit that describes in reasonable detail all actions defendants have taken and all steps defendants have implemented on an ongoing basis to comply with Section VIII of this Final Judgment. Each such affidavit shall also include a description of the efforts defendants have taken to complete the sale of the Divestiture Assets, including efforts to secure FCC or other regulatory approvals. Defendants shall deliver to the United States an affidavit describing any changes to the efforts and actions outlined in defendants' earlier affidavits filed pursuant to this section within fifteen (15) calendar days after the change is implemented.
C. Defendants shall keep all records of all efforts made to preserve and divest the Divestiture Assets until one year after such divestiture has been completed.
A. For the purposes of determining or securing compliance with this Final Judgment, or of any related orders such as the Hold Separate Stipulation and Order, or of determining whether the Final Judgment should be modified or vacated, and subject to any legally recognized privilege, from time to time duly authorized representatives of the United States Department of Justice, including consultants and other persons retained by the United States, shall, upon written request of an authorized representative of the Assistant Attorney General in charge of the Antitrust Division, and on reasonable notice to defendants, be permitted:
(1) access during defendants' office hours to inspect and copy, or at the option of the United States, to require defendants to provide hard copies or electronic copies of, all books, ledgers, accounts, records, data and documents in the possession, custody or control of defendants, relating to any matters contained in this Final Judgment; and
(2) to interview, either informally or on the record, defendants' officers, employees, or agents, who may have their individual counsel present, regarding such matters. The interviews shall be subject to the reasonable convenience of the interviewee and without restraint or interference by defendants.
B. Upon the written request of an authorized representative of the Assistant Attorney General in charge of the Antitrust Division, defendants shall submit written reports or responses to written interrogatories, under oath if requested, relating to any of the matters contained in this Final Judgment as may be requested.
C. No information or documents obtained by the means provided in this section shall be divulged by the United States to any person other than an authorized representative of the executive branch of the United States, except in the course of legal proceedings to which the United States is a party (including grand jury proceedings), or for the purpose of securing compliance with this Final Judgment, or as otherwise required by law.
D. If at the time information or documents are furnished by defendants to the United States, defendants represent and identify in writing the material in any such information or documents to which a claim of protection may be asserted under Rule 26(c)(1)(G) of the Federal Rules of Civil Procedure, and defendants mark each pertinent page of such material, “Subject to claim of protection under Rule 26(c)(1)(G) of the Federal Rules of Civil Procedure,” then the United States shall give defendants ten (10) calendar days notice prior to divulging such material in any legal proceeding (other than a grand jury proceeding).
After the Divestiture Assets have been divested to an Acquirer or Acquirers acceptable to the United States in its sole discretion, Defendants may not (1) reacquire any part of the Divestiture Assets, (2) acquire any option to reacquire any part of the Divestiture Assets or to assign the Divestiture Assets to any other person, (3) enter into any time brokerage agreement, local marketing agreement, joint sales agreement, other cooperative selling arrangement, or shared services agreement, or conduct other business negotiations jointly with the Acquirer(s) with respect to the Divestiture Assets, or (4) provide financing or guarantees of financing with respect to the Divestiture Assets, during the term of this Final Judgment.
The shared services prohibition does not preclude defendants from continuing or entering into any non-sales-related shared services agreement that is approved in advance by the United States in its sole discretion.
If defendants reach an agreement to divest the Divestiture Assets to the Acquirer, defendants may also enter into an agreement, approved in advance by the United States in its sole discretion, under which a defendant cedes to the Acquirer the sole right and ability to operate one or more of KOSI FM, KKFN FM and KYGO FM after the Court's approval of the Hold Separate Stipulation and Order in this matter, provided that any such time brokerage agreement (as well as any time brokerage agreement between a defendant and the Acquirer relating to any other broadcast radio stations in the Denver MSA) must expire upon the
This Court retains jurisdiction to enable any party to this Final Judgment to apply to this Court at any time for further orders and directions as may be necessary or appropriate to carry out or construe this Final Judgment, to modify any of its provisions, to enforce compliance, and to punish violations of its provisions.
Unless this Court grants an extension, this Final Judgment shall expire ten (10) years from the date of its entry.
Entry of this Final Judgment is in the public interest. The parties have complied with the requirements of the Antitrust Procedures and Penalties Act, 15 U.S.C. § 16, including making copies available to the public of this Final Judgment, the Competitive Impact Statement, and any comments thereon, and the United States' responses to comments. Based on the record before the Court, which includes the Competitive Impact Statement and any comments and responses to comments filed with the Court, entry of this Final Judgment is in the public interest.
Notice is hereby given that, on June 24, 2015, pursuant to section 6(a) of the National Cooperative Research and Production Act of 1993, 15 U.S.C. 4301
No other changes have been made in either the membership or planned activity of the group research project. Membership in this group research project remains open, and WITEK intends to file additional written notifications disclosing all changes in membership.
On August 8, 2008, WITEK filed its original notification pursuant to section 6(a) of the Act. The Department of Justice published a notice in the
The last notification was filed with the Department on April 2, 2015. A notice was published in the
Notice is hereby given that, on June 26, 2015, pursuant to section 6(a) of the National Cooperative Research and Production Act of 1993, 15 U.S.C. 4301
No other changes have been made in either the membership or planned activity of the group research project. Membership in this group research project remains open, and Interchangeable Virtual Instruments Foundation, Inc. intends to file additional written notifications disclosing all changes in membership.
On May 29, 2001, Interchangeable Virtual Instruments Foundation, Inc. filed its original notification pursuant to section 6(a) of the Act. The Department of Justice published a notice in the
The last notification was filed with the Department on August 8, 2014. A notice was published in the
Office of Justice Programs (OJP), Justice.
Notice of meeting; renewal of charter.
This notice announces a forthcoming meeting of OJP's Science Advisory Board (“the Board”). General Function of the Board: The Board is chartered to provide OJP, a component of the Department of Justice, with valuable advice in the areas of science and statistics for the purpose of enhancing the overall impact and performance of its programs and activities in criminal and juvenile justice.
The meeting will take place on Thursday, August 6, 2015, from approximately 9 a.m. to 3 p.m., with a break for lunch at approximately 12:00 p.m. The meeting will resume on Friday, August 7, 2015, from 8:30 a.m. to 4:00 p.m., ET, with a break for lunch at approximately 12:30 p.m.
The meeting will take place in the Main Conference Room and the Executive Conference Room on the third floor of the Office of Justice Programs, 810 7th Street, Northwest, Washington, DC 20531.
Katherine Darke, Designated Federal Officer (DFO), Office of the Assistant Attorney General, Office of Justice Programs, 810 7th Street Northwest, Washington, DC 20531; Phone: (202) 616-7373 [Note: This is not a toll-free
This meeting is being convened to brief the OJP Assistant Attorney General and the Board members on the progress of the subcommittees, discuss any recommendations they may have for consideration by the full Board, and brief the Board on various OJP-related projects and activities. The final agenda is subject to adjustment, but the meeting will likely include briefings of the subcommittees' activities and discussion of future Board actions and priorities. This meeting is open to the public. Members of the public who wish to attend this meeting must register with Katherine Darke at the above address at least seven (7) calendar days in advance of the meeting. Registrations will be accepted on a space available basis. Access to the meeting will not be allowed without registration. Persons interested in communicating with the Board should submit their written comments to the DFO, as the time available will not allow the public to directly address the Board at the meeting. Anyone requiring special accommodations should notify Ms. Darke at least seven (7) calendar days in advance of the meeting.
Notice.
The U.S. Departments of Labor and Education (the Departments), as part of their continuing effort to reduce paperwork and respondent burden, are conducting a preclearance consultation to provide the public and Federal agencies with an opportunity to comment on the proposed collection of information in accordance with the Paperwork Reduction Act of 1995 [44 U.S.C. 3506(c)(2)(A)] (PRA). The PRA helps ensure that respondents can provide requested data in the desired format with minimal reporting burden (time and financial resources), collection instruments are clearly understood and the impact of collection requirements on respondents can be properly assessed.
Currently, the Departments are soliciting comments concerning the collection of data for the WIOA Performance Management, Information, and Reporting System (OMB Control No. 1205-0NEW). The data collections included in this reporting system fulfill requirements in WIOA Sec.116(d)(1) for the development of report templates for the State Performance Report for WIOA core programs, the Local Area Performance Report, and the Eligible Training Provider Report. Previously, a supporting statement was provided for this data collection under OMB Control No. 1205-0420, which was made public on April 16, 2015. The sole difference between the aforementioned supporting statement and the subject of this notice is that OMB Control No. 1205-0NEW does not include the non-WIOA related, currently cleared burden.
Submit written comments to the office listed in the addresses section below on or before
Comments submitted in response to this notice should be submitted electronically through the Federal eRulemaking Portal at
Mail and hand delivery/courier: Send written comments to Luke Murren, Office of Policy Development and Research, Room N5641, Employment and Training Administration, U.S. Department of Labor, 200 Constitution Avenue NW., Washington, DC 20210. Due to security-related concerns, there may be a significant delay in the receipt of submissions by United States Mail. You must take this into consideration when preparing to meet the deadline for submitting comments.
Comments submitted in response to this comment request will become a matter of public record and will be summarized and included in the request for Office of Management and Budget approval of the information collection request. In addition, comments regardless of the delivery method, will be posted without change on the
Section 116 of WIOA requires States that operate core programs of the publicly-funded workforce system to comply with common performance accountability requirements. As such, States that operate core programs must submit common performance data to demonstrate that specified performance levels are achieved.
WIOA Sec. 116(d)(2)—“Contents of State Performance Reports”— mandates that the Secretaries of Labor and Education develop a template for performance reports to be used by States, local boards, and eligible
The WIOA Annual Local Area Performance Report Template is a subset of the WIOA Annual State Performance Report Template that, under section 116(d)(3) of WIOA, requires the collection of the same aforementioned counts and costs disaggregated by barriers to employment with respect to the primary indicators for the Title I Youth, Adult, and Dislocated Worker programs.
WIOA Sec. 116(d)(4)—“Contents of Eligible Training Provider Report” (in 20 CFR part 677 of the NPRM)—mandates the collection of specific information for each program of study for each eligible provider of training services under Title I Adult and Dislocated Worker programs. Required data must include those related to primary performance indicators, participant counts and costs, and barriers to employment.
These templates have been designed to maximize the value of the reports for workers, jobseekers, employers, local elected officials, State officials, Federal policymakers, and other key stakeholders. At the same time they have been designed to reflect the specific requirements of the reports as described in WIOA section 116(d)(2) through (4).
Once States, local areas, and eligible training providers submit the required data, it will be used by the Departments to assess the effectiveness of WIOA's core programs and to monitor and analyze the performance of their grantees. This data collection format permits the Departments to evaluate program effectiveness, monitor compliance with statutory requirements, and analyze participant activity, while complying with OMB efforts to streamline Federal performance reporting.
Under this collection, participation will be measured based on the count of individuals who meet the proposed definition of a “participant”—
The Department is particularly interested in comments that:
• Evaluate whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility;
• evaluate the accuracy of the agency's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used;
• enhance the quality, utility, and clarity of the information to be collected; and
• minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology (
We will summarize and/or include in the request for OMB approval of the ICR, the comments received in response to this comment request; they will also become a matter of public record.
As mentioned above, this ICR is intended to cover the performance data collection and reporting requirements in section 116 of WIOA. The notice of proposed rulemaking (NPRM) implementing WIOA was published on April 16, 2015, at 80 FR 20573-20687. The comment period closed on June 15, 2015.
Sec. 506(b)(1) of WIOA states that section 116 of WIOA will go into effect at the start of the second full program year after the date WIOA was enacted. WIOA was enacted on July 22, 2014. Therefore, section 116's performance accountability system will be effective on July 1, 2016. Approval of this information collection request is required so that the states, locals, and other entities can begin programming their management information systems in order to enable them to collect the necessary data to implement the data collection and reporting requirements of section 116 in accordance with the WIOA statute.
If this information collection receives OMB approval, it may be finalized before the proposed regulations are finalized. If this occurs, the Departments will resubmit this ICR to OMB for its approval when the Final Rule is published, as required by 5 CFR 1320.11(h). However, the Departments plan to review and analyze any comments received on the NPRM that are relevant to this ICR, together with comments received on this ICR as we finalize this ICR. This is intended to enable the Departments to finalize this ICR before finalizing the proposed regulations, and to eliminate the need to make any substantive changes to the ICR when the Final Rule is published.
National Aeronautics and Space Administration.
Notice of intent to grant exclusive license.
This notice is issued in accordance with 35 U.S.C. 209(e) and 37 CFR 404.7(a)(1)(i). NASA hereby gives notice of its intent to grant an exclusive license in the United States to practice the invention described and claimed in U.S. Provisional Patent Application No. 62/116,742, titled “A Method and Stamp for Repeatable Image Correlation Micro Patterning and Resulting Specimen Produced Therefrom,” NASA Case No. LAR-18577-1, and any nonprovisional patent applications resulting therefrom, to 1900 LLC, having its principal place of business in Clemson, South Carolina. Certain patent rights in this invention have been assigned to the United States of America as represented by the Administrator of the National Aeronautics and Space Administration. The prospective exclusive license will comply with the terms and conditions of 35 U.S.C. 209 and 37 CFR 404.7.
The prospective exclusive license may be granted unless, within fifteen (15) days from the date of this published notice, NASA receives written objections including evidence and argument that establish that the grant of the license would not be consistent with the requirements of 35 U.S.C. 209 and 37 CFR. 404.7. Competing applications completed and received by NASA within fifteen (15) days of the date of this published notice will also be treated as objections to the grant of the contemplated partially exclusive license.
Objections submitted in response to this notice will not be made available to the public for inspection and, to the extent permitted by law, will not be released under the Freedom of Information Act, 5 U.S.C. 552.
Objections relating to the prospective license may be submitted to Patent Counsel, Office of Chief Counsel, NASA Langley Research Center, MS 30, Hampton, VA 23681; (757) 864-3221 (phone), (757) 864-9190 (fax).
Andrea Z. Warmbier, Patent Attorney, Office of Chief Counsel, NASA Langley Research Center, MS 30, Hampton, VA 23681; (757) 864-3221; Fax: (757) 864-9190. Information about other NASA inventions available for licensing can be found online at
National Aeronautics and Space Administration.
Notice of intent to grant partially exclusive license.
This notice is issued in accordance with 35 U.S.C. 209(e) and 37 CFR 404.7(a)(1)(i). NASA hereby gives notice of its intent to grant a partially exclusive license in the United States to practice the invention described and claimed in U.S. Patent No. 8,977,482 B2 entitled “Method and Apparatus for Generating Flight-Optimizing Trajectories,” NASA Case No. LAR-18077-1; U.S. Provisional Patent Application No. 62/058,390 entitled “Traffic Aware Planner (TAP) Human Machine Interface (HMI) Version 4,” NASA Case No. LAR-18551-P; and U.S. Provisional Patent Application No. 62/058,423 entitled “Traffic Aware Planner (TAP) Human Machine Interface (HMI) Version 4,” NASA Case No. LAR-18551-P2, to Alaska Airlines, Incorporated having its principal place of business in Seattle, Washington. The fields of use may be limited to, but not necessarily limited to, aircraft owned and operated by Alaska Airlines, Incorporated. The patent rights in these inventions have been assigned to the United States of America as represented by the Administrator of the National Aeronautics and Space Administration. The prospective partially exclusive license will comply with the terms and conditions of 35 U.S.C. 209 and 37 CFR 404.7.
The prospective partially exclusive license may be granted unless, within fifteen (15) days from the date of this published notice, NASA receives written objections including evidence and argument that establish that the grant of the license would not be consistent with the requirements of 35 U.S.C. 209 and 37 CFR. 404.7. Competing applications completed and received by NASA within fifteen (15) days of the date of this published notice will also be treated as objections to the grant of the contemplated partially exclusive license.
Objections submitted in response to this notice will not be made available to the public for inspection and, to the extent permitted by law, will not be released under the Freedom of Information Act, 5 U.S.C. 552.
Objections relating to the prospective license may be submitted to Patent Counsel, Office of Chief Counsel, NASA Langley Research Center, MS 30, Hampton, VA 23681; (757) 864-3230 (phone), (757) 864-9190 (fax).
Jennifer L. Riley, Patent Attorney, Office of Chief Counsel, NASA Langley Research Center, MS 30, Hampton, VA 23681; (757) 864-5057; Fax: (757) 864-9190. Information about other NASA inventions available for licensing can be found online at
National Aeronautics and Space Administration (NASA).
Notice of information collection.
The National Aeronautics and Space Administration, as part of its continuing effort to reduce paperwork and respondent burden, invites the general public and other Federal agencies to take this opportunity to comment on proposed and/or continuing information collections, as required by the Paperwork Reduction Act of 1995 (Pub. L. 104-13, 44 U.S.C. 3506(c)(2)(A)).
All comments should be submitted within 30 calendar days from the date of this publication.
Interested persons are invited to submit written comments regarding the proposed information collection to the Office of Information and Regulatory Affairs, Office of Management and Budget, 725 7th Street NW., Washington DC, 20543. Attention: Desk Officer for NASA.
Requests for additional information or copies of the information collection instrument(s) and instructions should be directed to Frances Teel, NASA PRA
NASA's founding legislation, the Space Act of 1958, as amended, directs the Agency to expand human knowledge of Earth and space phenomena and to preserve the role of the United States as a leader in aeronautics, space science, and technology. The NASA Office of Education has three primary goals: (1) Strengthen NASA and the Nation's future workforce, (2) attract and retain students in science, technology, engineering and mathematics, or STEM, disciplines, and (3) engage Americans in NASA's mission.
This notice informs the public of NASA's intent to revise a currently approved information collection for a project formerly known as the NASA Summer of Innovation Project. The request for renewal pertains to the administration of surveys to youth in support of the agency's STEM challenge activities for middle school youth. The information collection was revised to collect the minimum amount of data required to (1) evaluate the activity for improvement opportunities, and (2) collect outcome data to assess the activity model's effectiveness in meeting its intended objectives. Youth surveys have been retained in this information collection, but the parent survey and teacher focus groups have been eliminated to reduce burden. The number of youth participating in this information collection has been reduced to reflect the estimated number of participants who will be engaged in this activity in the future. The cost of the information collection, to participating members of the public, has also been reduced as a result of these and other changes to the information collection.
Electronic.
Comments are invited on: (1) Whether the proposed collection of information is necessary for the proper performance of the functions of NASA, including whether the information collected has practical utility; (2) the accuracy of NASA's estimate of the burden (including hours and cost) of the proposed collection of information; (3) ways to enhance the quality, utility, and clarity of the information to be collected; and (4) ways to minimize the burden of the collection of information on respondents, including automated collection techniques or the use of other forms of information technology.
Nuclear Regulatory Commission.
Renewal of existing information collection; request for comment.
The U.S. Nuclear Regulatory Commission (NRC) invites public comment on the renewal of Office of Management and Budget (OMB) approval for an existing collection of information. The information collection is entitled, NRC Form 531 “Request for Taxpayer Identification Number”.
Submit comments by September 21, 2015. Comments received after this date will be considered if it is practical to do so, but the Commission is able to ensure consideration only for comments received on or before this date.
You may submit comments by any of the following methods:
• Federal Rulemaking Web site: Go to
• Mail comments to: Tremaine Donnell, Office of Information Services, Mail Stop: T-5 F53, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001.
For additional direction on obtaining information and submitting comments, see “Obtaining Information and Submitting Comments” in the
Tremaine Donnell, Office of Information Services, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001; telephone: 301-415-6258; email:
Please refer to Docket ID NRC-2015-0166 when contacting the NRC about the availability of information for this action. You may obtain publicly-available information related to this action by any of the following methods:
• Federal rulemaking Web site: Go to
• NRC's Agencywide Documents Access and Management System (ADAMS): You may obtain publicly-available documents online in the ADAMS Public Documents collection at
• NRC's PDR: You may examine and purchase copies of public documents at the NRC's PDR, Room O1-F21, One White Flint North, 11555 Rockville Pike, Rockville, Maryland 20852.
• NRC's Clearance Officer: A copy of the collection of information and related instructions may be obtained without charge by contacting NRC's Clearance Officer, Tremaine Donnell, Office of Information Services, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001; telephone: 301-415-
Please include Docket ID NRC-2015-0166 in the subject line of your comment submission, in order to ensure that the NRC is able to make your comment submission available to the public in this docket.
The NRC cautions you not to include identifying or contact information in comment submissions that you do not want to be publicly disclosed in your comment submission. The NRC will post all comment submissions at
If you are requesting or aggregating comments from other persons for submission to the NRC, then you should inform those persons not to include identifying or contact information that they do not want to be publicly disclosed in their comment submission. Your request should state that the NRC does not routinely edit comment submissions to remove such information before making the comment submissions available to the public or entering the comment into ADAMS.
In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. Chapter 35), the NRC is requesting public comment on its intention to request the OMB's approval for the information collection summarized below.
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The NRC is seeking comments that address the following questions:
1. Is the proposed collection of information necessary for the NRC to properly perform its functions? Does the information have practical utility?
2. Is the estimate of the burden of the information collection accurate?
3. Is there a way to enhance the quality, utility, and clarity of the information to be collected?
4. How can the burden of the information collection on respondents be minimized, including the use of automated collection techniques or other forms of information technology?
For the Nuclear Regulatory Commission.
Overseas Private Investment Corporation (OPIC).
Notice and request for comments.
Overseas Private Investment Corporation, as part of its continuing effort to reduce paperwork and respondent burden, invites the general public to take this opportunity to comment on the “Generic Clearance for the Collection of Qualitative Feedback on Agency Service Delivery” for approval under the Paperwork Reduction Act (PRA) (44 U.S.C. 3501 et. seq.). This collection was developed as part of a Federal Government-wide effort to streamline the process for seeking feedback from the public on service delivery. This notice announces our intent to submit this collection to OMB for approval and solicits comments on specific aspects for the proposed information collection.
Comments must be received within sixty (60) calendar days of publication of this Notice.
Mail all comments and requests for copies of the subject form to OPIC's Agency Submitting Officer: James Bobbitt, Overseas Private Investment Corporation, 1100 New York Avenue NW., Washington, DC 20527.
OPIC Agency Submitting Officer: James Bobbitt, (202) 336-8558.
The solicitation of feedback will target areas such as: Timeliness, appropriateness, accuracy of information, courtesy, efficiency of service delivery, and resolution of issues with service delivery. Responses will be assessed to plan and inform efforts to improve or maintain the quality of service offered to the public. If this information is not collected, vital feedback from customers and stakeholders on the Agency's services will be unavailable.
The Agency will only submit a collection for approval under this
• The collections are voluntary;
• The collections are low-burden for respondents (based on considerations of total burden hours, total number of respondents, or burden-hours per respondent) and are low-cost for both the respondents and the Federal Government;
• The collections are non-controversial and do not raise issues of concern to other Federal agencies;
• Any collection is targeted to the solicitation of opinions from respondents who have experience with the program or may have experience with the program in the near future;
• Personally identifiable information (PII) is collected only to the extent necessary and is not retained;
• Information gathered will be used only internally for general service improvement and program management purposes and is not intended for release outside of the agency;
• Information gathered will not be used for the purpose of substantially informing influential policy decisions; and
• Information gathered will yield qualitative information; the collections will not be designed or expected to yield statistically reliable results or used as though the results are generalizable to the population of study.
Feedback collected under this generic clearance provides useful information, but it does not yield data that can be generalized to the overall population. This type of generic clearance for qualitative information will not be used for quantitative information collections that are designed to yield reliably actionable results, such as monitoring trends over time or documenting program performance. Such data uses require more rigorous designs that address: The target population to which generalizations will be made, the sampling frame, the sample design (including stratification and clustering), the precision requirements or power calculations that justify the proposed sample size, the expected response rate, methods for assessing potential non-response bias, the protocols for data collection, and any testing procedures that were or will be undertaken prior to fielding the study. Depending on the degree of influence the results are likely to have, such collections may still be eligible for submission for other generic mechanisms that are designed to yield quantitative results.
As a general matter, information collections will not result in any new system of records containing privacy information and will not ask questions of a sensitive nature, such as sexual behavior and attitudes, religious beliefs, and other matters that are commonly considered private.
Overseas Private Investment Corporation (OPIC).
Notice and request for comments.
Under the provisions of the Paperwork Reduction Act (44 U.S.C. chapter 35), agencies are required to publish a Notice in the
Comments must be received within sixty (60) calendar days of publication of this Notice.
Mail all comments and requests for copies of the subject form to OPIC's Agency Submitting Officer: James Bobbitt, Overseas Private Investment Corporation, 1100 New York Avenue NW., Washington, DC 20527. See
OPIC Agency Submitting Officer: James Bobbitt, (202)336-8558.
All mailed comments and requests for copies of the subject form should include form number OPIC-257 on both the envelope and in the subject line of the letter. Electronic comments and requests for copies of the subject form may be sent to
Postal Regulatory Commission.
Notice.
The Commission is noticing a recent Postal Service filing concerning an additional Global Expedited Package Services 3 negotiated service agreement. This notice informs the public of the filing, invites public comment, and takes other administrative steps.
Submit comments electronically via the Commission's Filing Online system at
David A. Trissell, General Counsel, at 202-789-6820.
On July 15, 2015, the Postal Service filed notice that it has entered into an additional Global Expedited Package Services 3 (GEPS 3) negotiated service agreement (Agreement).
To support its Notice, the Postal Service filed a copy of the Agreement, a copy of the Governors' Decision authorizing the product, a certification of compliance with 39 U.S.C. 3633(a), and an application for non-public treatment of certain materials. It also filed supporting financial workpapers.
The Commission establishes Docket No. CP2015-103 for consideration of matters raised by the Notice.
The Commission invites comments on whether the Postal Service's filing is consistent with 39 U.S.C. 3632, 3633, or 3642, 39 CFR part 3015, and 39 CFR part 3020, subpart B. Comments are due no later than July 23, 2015. The public portions of the filing can be accessed via the Commission's Web site (
The Commission appoints Lyudmila Y. Bzhilyanskaya to serve as Public Representative in this docket.
1. The Commission establishes Docket No. CP2015-103 for consideration of the matters raised by the Postal Service's Notice.
2. Pursuant to 39 U.S.C. 505, Lyudmila Y. Bzhilyanskaya is appointed to serve as an officer of the Commission to represent the interests of the general public in this proceeding (Public Representative).
3. Comments are due no later than July 23, 2015.
4. The Secretary shall arrange for publication of this order in the
By the Commission.
Pursuant to Section 19(b)(1)
The Exchange proposes to amend the NYSE Arca Options Fee Schedule (“Fee Schedule”). The Exchange proposes to implement the fee change effective July 10, 2015. The text of the proposed rule change is available on the Exchange's Web site at
In its filing with the Commission, the self-regulatory organization included statements concerning the purpose of, and basis for, the proposed rule change and discussed any comments it received on the proposed rule change. The text of those statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant parts of such statements.
The purpose of this filing is to enhance the application of the Limit of Fees on Firm and Broker Dealer Open Outcry Executions (the “Firm Cap”) to include Qualified Contingent Cross Transactions (“QCCs”).
Currently, the Exchange imposes a Firm Cap of $100,000 per month on combined Firm Proprietary Fees and Broker Dealer Fees for transactions clearing in the customer range, if executed in open outcry (
To date, fees arising from QCCs have not been included in the Firm Cap because QCCs are not executed in open outcry. Rather, QCCs are executed by the entry of a matched trade into the Exchange System and reported electronically.
The proposed inclusion of QCC fees in the Firm Cap would not affect the Floor Broker Rebate for Executed Orders, as Floor Brokers would still earn the Rebate even if the fee for the transaction itself is capped.
Consistent with the proposed change, the Exchange proposes to change the name of this fee from “Limit of Fees on Firm and Broker Dealer Open Outcry Executions” to “Firm and Broker Dealer Monthly Fee Cap,” which the Exchange believes would add more clarity and consistency to the fee schedule. Relatedly, the Exchange also proposes to modify the language in the Firm Cap regarding the exclusion of Mini options which erroneously refers to Strategy Executions. Specifically, the Exchange proposes to replace the language “Mini option contracts are excluded from the Limit of Fees on Strategy Executions,” with “Mini option contracts are excluded from the Firm and Broker Dealer Monthly Fee Cap.” The Exchange believes that this change would add clarity and consistency to the Fee Schedule.
The Exchange believes that the proposed rule change is consistent with Section 6(b) of the Act,
The Exchange believes the inclusion of the Floor executed QCCs under the Firm Cap is reasonable and not unfairly discriminatory because it would provide additional opportunities for Firms and Broker Dealers to achieve the Firm Cap, which may, in turn, encourage more business, not limited to QCC trades, to be brought to the Floor, which would benefit all market participants. The proposed change is reasonable, equitable and not unfairly discriminatory as the Firm Cap would not be meaningful for Customers or Professional Customers because neither Customers nor Professional Customers pay transaction charges for QCCs. The proposed change is also reasonable, equitable and not unfairly discriminatory towards Market Makers, as Market Makers are generally charged a lower fee for Manual executions, and have alternative avenues to reduce transaction fees.
The Exchange also believes that the proposed change is reasonable because several competing options exchanges likewise include QCC transactions in monthly fee caps similar to Firm Cap.
The Exchange believes that its proposal to modify the name of this fee, as well as the language regarding the exclusion of Mini options from the Firm Cap to correct the erroneous reference to Strategy Executions, would add clarity and consistency to the Fee Schedule to the benefit of all market participants.
For these reasons, the Exchange believes that the proposal is consistent with the Act.
In accordance with Section 6(b)(8) of the Act,
The Exchange notes that it operates in a highly competitive market in which market participants can readily favor competing venues. In such an environment, the Exchange must continually review, and consider adjusting, its fees and credits to remain competitive with other exchanges. For the reasons described above, the Exchange believes that the proposed rule change reflects this competitive environment.
No written comments were solicited or received with respect to the proposed rule change.
The foregoing rule change is effective upon filing pursuant to Section 19(b)(3)(A)
At any time within 60 days of the filing of such proposed rule change, the Commission summarily may temporarily suspend such rule change if
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Brent J. Fields, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
On November 14, 2014, Financial Industry Regulatory Authority, Inc. (“FINRA”) filed with the Securities and Exchange Commission (“SEC” or “Commission”), pursuant to section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”)
This order approves the proposed rule change.
As described more fully in the Notice, FINRA proposed to adopt, in the Consolidated FINRA Rulebook, NASD Rule 2711 (Research Analysts and Research Reports), with several modifications, as FINRA Rule 2241. The proposed rule change also would amend NASD Rule 1050 (Registration of Research Analysts) and Incorporated NYSE Rule 344 (Research Analysts and Supervisory Analysts) to create an exception from the research analyst qualification requirements.
FINRA believes that the proposed rule change would retain the core provisions of the current rules, broaden the obligations on members to identify and manage research-related conflicts of interest, restructure the rules to provide some flexibility in compliance without diminishing investor protection, extend
As stated above, the Commission originally received four comments on the proposal. Of these, three expressed general support for the proposal,
FINRA proposed to mostly maintain the definitions in current NASD Rule 2711, with certain modifications. Specifically, FINRA made minor changes to the definition of “investment banking services” to clarify that such services include all acts in furtherance of a public or private offering on behalf of an issuer.
FINRA proposed to create a new section entitled “Identifying and Managing Conflicts of Interest.” This section contains an overarching provision that requires members to establish, maintain, and enforce written policies and procedures reasonably designed to identify and effectively manage conflicts of interest related to the preparation, content, and distribution of research reports and public appearances by research analysts and the interaction between research analysts and persons outside of the research department, including investment banking and sales and trading personnel, the subject companies, and customers.
As proposed, the first of these minimum requirements would require that the policies and procedures prohibit prepublication review, clearance, or approval of research reports by persons engaged in investment banking services activities and restrict or prohibit such review, clearance, or approval by other persons not directly responsible for the preparation, content, and distribution of research reports, other than legal and compliance personnel.
The proposed rule change would require that the policies and procedures restrict or limit input by the investment banking department into research coverage decisions to ensure that research management independently makes all final decisions regarding the research coverage plan.
The proposed rule change would require that the policies and procedures prohibit persons engaged in investment banking activities from supervision or control of research analysts, including influence or control over research analyst compensation evaluation and determination.
The proposed rule change would require that the policies and procedures
The proposed rule change would require that the policies and procedures prohibit compensation based upon specific investment banking services transactions or contributions to a member's investment banking services activities.
The proposed rule change would require that the policies and procedures establish information barriers or other institutional safeguards reasonably designed to ensure that research analysts are insulated from the review, pressure, or oversight by persons engaged in investment banking services activities or other persons, including sales and trading personnel, who might be biased in their judgment or supervision.
The proposed rule change would require that the policies and procedures prohibit direct or indirect retaliation or threat of retaliation against research analysts employed by the member or its affiliates by persons engaged in investment banking services activities or other employees as the result of an adverse, negative, or otherwise unfavorable research report or public appearance written or made by the research analyst that may adversely affect the member's present or prospective business interests.
The proposed rule change would require that the policies and procedures define quiet periods of a minimum of ten days after an initial public offering (“IPO”), and a minimum of three days after a secondary offering, during which the member must not publish or otherwise distribute research reports, and research analysts must not make public appearances, relating to the issuer if the member has participated as an underwriter or dealer in the IPO or, with respect to the quiet periods after a secondary offering, acted as a manager or co-manager of that offering.
With respect to these quiet-period provisions, the proposed rule change would reduce the current forty day quiet period for IPOs to a minimum of ten days after the completion of the offering for any member that participated as an underwriter or dealer, and reduces the ten day secondary offering quiet period to a minimum of three days after the completion of the offering for any member that has acted as a manager or co-manager in the secondary offering. The proposed rule change would maintain exceptions to these quiet periods for research reports or public appearances concerning the effects of significant news or a significant event on the subject company and, for secondary offerings, research reports or public appearances pursuant to Rule 139 under the Securities Act of 1933 regarding a subject company with “actively-traded securities.”
The proposed rule change also eliminates the current quiet periods of fifteen days before and after the expiration, waiver or termination of a lock-up agreement.
In addition, the proposed rule change would require firms to adopt written policies and procedures to restrict or limit activities by research analysts that can reasonably be expected to compromise their objectivity.
The proposed rule change also would add Supplementary Material .01, which would codify FINRA's existing interpretation that the solicitation provision prohibits members from including in pitch materials any information about a member's research capacity in a manner that suggests, directly or indirectly, that the member might provide favorable research coverage.
The proposed rule would establish a new proscription with respect to joint due diligence activities—
The proposed rule would continue to prohibit investment banking department personnel from directly or indirectly directing a research analyst to engage in sales or marketing efforts related to an investment banking services transaction, and directing a research analyst to engage in any communication with a current or prospective customer about an investment banking services transaction.
FINRA proposed to maintain the current prohibition against promises of favorable research, a particular research recommendation, rating, or specific content as inducement for receipt of business or compensation.
FINRA proposed to require that firms establish written policies and procedures that restrict or limit research analyst account trading in securities, any derivatives of such securities and funds whose performance is materially dependent upon the performance of securities covered by the research analyst.
With some modification, the proposed rule change would maintain the current disclosure requirements. The proposed rule change would add a requirement that a member must establish, maintain and enforce written policies and procedures reasonably designed to ensure that purported facts in its research reports are based on reliable information.
In addition, the proposed rule change would require a member to disclose in any research report at the time of publication or distribution of the report:
• If the research analyst or a member of the research analyst's household has a financial interest in the debt or equity securities of the subject company (including, without limitation, whether it consists of any option, right, warrant, future, long or short position), and the nature of such interest;
• If the research analyst has received compensation based upon (among other factors) the member's investment banking revenues;
• If the member or any of its affiliates: (i) Managed or co-managed a public offering of securities for the subject company in the past 12 months; (ii) received compensation for investment banking services from the subject company in the past 12 months; or (iii) expects to receive or intends to seek compensation for investment banking services from the subject company in the next three months;
• If, as of the end of the month immediately preceding the date of publication or distribution of a research report (or the end of the second most recent month if the publication or distribution date is less than 30 calendar days after the end of the most recent
• If the subject company is, or over the 12-month period preceding the date of publication or distribution of the research report has been, a client of the member, and if so, the types of services provided to the issuer. Such services, if applicable, must be identified as either investment banking services, non-investment banking services, non-investment banking securities-related services or non-securities services;
• If the member was making a market in the securities of the subject company at the time of publication or distribution of the research report;
• If the research analyst received any compensation from the subject company in the previous 12 months.
The proposed rule change would also expand upon the current “catch-all” disclosure, which mandates disclosure of any other material conflict of interest of the research analyst or member that the research analyst knows or has reason to know of at the time of the publication or distribution of a research report. The proposed rule change would go beyond the existing provision by requiring disclosure of material conflicts known not only by the research analyst, but also by any “associated person of the member with the ability to influence the content of a research report.”
The proposed rule change also maintains the requirement to disclose when a member or its affiliates beneficially own 1% or more of any class of common equity securities of the subject company.
The proposal would modify the exception for disclosure that would reveal material non-public information regarding specific potential future investment banking transactions of the subject company to also include specific potential future investment banking transactions of other companies, such as a competitor of the subject company.
The proposal would group in a separate provision the disclosures required when a research analyst makes a public appearance.
With respect to both research reports and public appearances, members and research analysts would continue to be required to comply with applicable disclosure provisions of FINRA Rule 2210 and the federal securities laws.
The proposed rule change would retain, with non-substantive modifications, the provision in the current rules that requires a member to notify its customers if it intends to terminate coverage of a subject company.
The proposal would require firms to establish, maintain and enforce written policies and procedures reasonably designed to ensure that a research report is not distributed selectively to internal trading personnel or a particular customer or class of customers in advance of other customers that the firm has previously determined are entitled to receive the research report.
The proposal would maintain the existing third-party disclosure requirements,
FINRA stated that the proposal would continue to address qualitative aspects of third-party research reports. For example, the proposal would maintain, but in the form of policies and procedures, the existing requirement that a registered principal or supervisory analyst review and approve third-party research reports distributed by a member. To that end, the proposed rule change would require a member to establish, maintain, and enforce written policies and procedures reasonably designed to ensure that any third-party research it distributes contains no untrue statement of material fact and is otherwise not false or misleading. For the purpose of this requirement, a member's obligation to review a third-party research report would extend to any untrue statement of material fact or any false or misleading information that should be known from reading the research report or is known based on information otherwise possessed by the member.
The proposal would maintain the existing exceptions for “independent third-party research reports.” Specifically, such research would not require principal pre-approval or, where the third-party research is not “pushed out,” the third-party disclosures.
Finally, under the proposed rule change, members would be required to ensure that a third-party research report is clearly labeled as such and that there is no confusion on the part of the recipient as to the person or entity that prepared the research report.
The current rule exempts firms with limited investment banking activity—those that over the previous three years, on average per year, have managed or co-managed 10 or fewer investment banking transactions and generated $5 million or less in gross revenues from those transactions—from the provisions that prohibit a research analyst from being subject to the supervision or control of an investment banking department employee because the potential conflicts with investment banking are minimal.
The proposed rule change would further exempt firms with limited investment banking activity from the provisions restricting or limiting research coverage decisions and budget determinations. In addition, the proposal would exempt eligible firms from the requirement to establish information barriers or other institutional safeguards to insulate research analysts from the review or oversight by investment banking personnel or other persons, including sales and trading personnel, who may be biased in their judgment or supervision. However, those firms would still be required to establish information barriers or other institutional safeguards reasonably designed to ensure that research analysts are insulated from
The proposed rule change would amend the definition of “research analyst” for the purposes of the registration and qualification requirements to limit the scope to persons who produce “research reports” and whose primary job function is to provide investment research (
The proposed rule change would delete the requirement to attest annually that the firm has in place written supervisory policies and procedures reasonably designed to achieve compliance with the applicable provisions of the rules, including the compensation committee review provision. As FINRA explained in the Notice, firms already are obligated pursuant to NASD Rule 3010 (Supervision) to have a supervisory system reasonably designed to achieve compliance with all applicable securities laws and regulations and FINRA rules. Moreover, the research rules also are subject to the supervisory control rules (NASD Rule 3012) and the annual certification requirement regarding compliance and supervisory processes (FINRA Rule 3130).
Proposed Supplementary Material .09 would clarify the obligations of each associated person under those provisions of the proposed rule change that require a member to restrict or prohibit certain conduct by establishing, maintaining and enforcing particular written policies and procedures. Specifically, the proposal provides that, consistent with FINRA Rule 0140, persons associated with a member would be required to comply with such member's policies and procedures as established pursuant to proposed FINRA Rule 2241.
The proposed rule change would provide FINRA, pursuant to the Rule 9600 Series, with authority to conditionally or unconditionally grant, in exceptional and unusual circumstances, an exemption from any requirement of the proposed rule for good cause shown, after taking into account all relevant factors and provided that such exemption is consistent with the purposes of the rule, the protection of investors, and the public interest.
In response to the proposal as originally proposed by FINRA, the Commission received four comments.
Three of the four commenters to the original proposal,
The rule proposal would adopt a policies and procedures approach to identification and management of research-related conflicts of interest and require those policies and procedures to prohibit or restrict particular conduct. Commenters both to the original proposal and after it was amended by Amendment No. 1 expressed several concerns with the approach.
Two commenters, with regards to the original proposal, asserted that the mix of a principles-based approach with prescriptive requirements was confusing in places and posed operational challenges. In particular, the commenters recommended eliminating the minimum standards for the policies and procedures.
FINRA stated that it believes the framework will maintain the same level of investor protection in the current rules while providing both some flexibility for firms to align their compliance systems with their business model and philosophy and imposing additional obligations to proactively identify and manage emerging conflicts. Even under a policies and procedures approach, FINRA believes that the proposals would effectively maintain, with some modifications, the key proscriptions in the current rules—
One commenter, with regards to the proposal as amended by Amendment No. 1, reiterated its earlier comments regarding their concerns relating to the principles-based nature of the proposal. This commenter stated that the historical mismanagement of the conflicts of interest inherent to equity research by firms necessitates a proscriptive, rather than principles-based approach. The commenter noted that violations in this area are “recent and continued” and that they and other commenters noted that the proposal seemed “unclear and likely to result in confusion.”
In light of the overarching principle that requires firms to establish, maintain and enforce written policies and procedures reasonably designed to identify and effectively manage research-related conflicts, the “at a minimum” language was meant to convey that additional conflicts management policies and procedures may be needed to address emerging conflicts that may arise as the result of business changes, such as new research products, affiliations or distribution methods at a particular firm. FINRA stated it intends for firms to proactively identify and manage those conflicts with appropriately designed policies and procedures. Thus, FINRA's inclusion of the “at a minimum” language was not intended to suggest that firms' written policies and procedures must go beyond the specified prohibitions and restrictions in the proposal where no new conflicts have been identified. However, FINRA stated it believes the overarching requirement for policies and procedures reasonably designed to identify and effectively manage research-related conflicts suffices to achieve the intended regulatory objective, and therefore to eliminate any confusion, FINRA proposed in Amendment No. 1 to amend the proposal to delete the “at a minimum” language.
One commenter regarding the proposal as amended by Amendment No. 1 specifically took issue with this action of removing the “at a minimum” requirement as “this language was helpful in maintaining the prescriptive nature of the current rules by ensuring that a firm's policies and procedures met at least a minimum standard.”
FINRA clarified in Amendment No. 1 that it appreciates the commenters' concerns with respect to language in the supplementary material that would make a violation of a firm's policies a violation of the underlying rule. According to FINRA, the supplementary material was intended to hold individuals responsible for engaging in the conduct that the policies and procedures effectively restrict or prohibit. FINRA stated that it agrees that purpose is achieved with the language in the supplementary material that states that, consistent with FINRA Rule 0140, “it shall be a violation of [the Rule] for an associated person to engage in the restricted or prohibited conduct to be addressed through the establishment, maintenance and enforcement of policies and procedures required by [the Rule] or related Supplementary Material.” Therefore, FINRA proposed in Amendment No. 1 to amend the proposed rule change to delete the language stating that a violation of a firm's policies and procedures shall constitute a violation of the rule itself.
One commenter responding to the proposal as amended by Amendment No. 1 objected to this change.
Lastly, one commenter regarding the institution of proceedings sought leeway or guidance regarding examiners' interpretation of FINRA's rules, specifically, what constitutes “reasonable,” with regards to small firms who have only institutional
One commenter requested that the original proposal define the term “sales and trading personnel” as “persons who are primarily responsible for performing sales and trading activities, or exercising direct supervisory authority over such persons.”
One commenter to the original proposal asked FINRA to include an exclusion from the definition of “research report” for private placement memoranda and similar offering-related documents prepared in connection with investment banking services transactions.
FINRA clarified that the definition of “research report” is generally understood not to include such offering-related documents prepared in connection with investment banking services transactions. In the course of administering the filing review programs under FINRA Rules 2210 (Communications with the Public), 5110 (Corporate Financing Rule), 5122 (Member Private Offerings) and 5123 (Private Placements of Securities), FINRA stated it has not received any inquiries or addressed any issues that indicate there is confusion regarding the scope of the research analyst rules as applied to offering-related documents prepared in connection with investment banking activities. Regardless, FINRA proposed in Amendment No. 1 to amend the proposed rule change to exclude private placement memoranda and similar offering-related documents prepared in connection with investment banking services transactions other than those that purport to be research from the definition of “research report” to provide firms with greater clarity as to the status of such offering-related documents under the proposal. The commenter noted its approval in its comment letter regarding Amendment No. 1.
One commenter asked FINRA to refrain from using the concept of “reliable” research in the proposals as it may inappropriately connote accuracy in the context of a research analyst's opinions.
One commenter asked FINRA to eliminate as redundant the term “independently” from the provisions permitting non-research personnel to have input into research coverage, so long as research management “independently makes all final decisions regarding the research coverage plan.”
One commenter to the institution of proceedings suggested that the terms “manager” and “co-manager” used with regards to the quiet period provisions in the proposal were unclear.
The proposed rule would require written policies and procedures to “establish information barriers or other institutional safeguards reasonably designed to ensure that research analysts are insulated from the review, pressure or oversight by persons engaged in investment banking services activities or other persons, including sales and trading department personnel, who might be biased in their judgment or supervision.” Some commenters to the original proposal suggested that “review” was unnecessary in this provision because the review of research analysts was addressed sufficiently in other parts of the proposed rule.
One commenter to the original proposal asked FINRA to clarify that the information barriers or other institutional safeguards required by the proposed rule are not intended to prohibit or limit activities that would otherwise be permitted under other provisions of the rule.
This commenter stated in their comment in response to Amendment No. 1 that they interpreted this to mean that the proposal would permit members to allow persons engaged in sales and trading activities to provide informal and formal feedback on research analysts as one factor to be considered by research management for the purposes of the evaluation of the analyst.
The commenter also asserted that the terms “bias” and “pressure” are broad and ambiguous on their face and requested that FINRA clarify that for purposes of the information barriers requirement that they are intended to address persons who may try to improperly influence research.
One commenter asked FINRA to modify the information barriers or other institutional safeguards requirement to conform the provision to FINRA's “reasonably designed” standard for policies and procedures that members must adopt.
One commenter to the original proposal opposed as overbroad the proposed expansion of the current “catch-all” disclosure requirement to include “any other material conflict of interest of the research analyst or member that a research analyst
FINRA stated that it proposed the change to capture material conflicts of interest known by persons other than the research analyst (
FINRA stated it continues to believe that a potential gap exists in the current rules where a supervisor or other person with the authority to change the content of a research report knows of a material conflict. However, FINRA stated it intended for the provision to capture only those individuals who are required to review the content of a particular research report or have exercised their authority to review or change the research report prior to publication or distribution. In addition, FINRA stated it did not intend to capture legal or compliance personnel who may review a research report for compliance purposes but are not authorized to dictate a particular recommendation,
This commenter in their comment in response to Amendment No. 1, while expressing their support for these changes, asked FINRA to make a modification of the parties who trigger disclosure of any other material conflict of interest. Specifically, the commenter asked FINRA to limit this disclosure to only be required when someone has authority to dictate a particular recommendation, rating, or price target.
One commenter requested confirmation that members may rely on hyperlinked disclosures for research reports that are delivered electronically, even if these reports are subsequently printed out by customers.
The proposal requires firms to establish, maintain and enforce written policies and procedures reasonably designed to ensure that a research report is not distributed selectively to internal trading personnel or a particular customer or class of customers in advance of other customers that the firm has previously determined are entitled to receive the research report. The proposals also include supplementary material that explains that firms may provide different research products to different classes of customers—
One commenter supported the provisions as proposed with general disclosure,
The opposing commenter stated that they believed that permitting contrary opinions while only disclosing the possibility of this contrary research to investors was insufficient to adequately protect investors because the use of “may” in a disclosure is not the same as disclosing that there actually are opposing opinions. Further, they questioned whether such disclosure was consistent with the Act in that it may be contrary to Rule 10b-5 by permitting the omission of a material fact in the research report. This commenter did not believe that the disclosure of actual opposing views would be burdensome on members as they should be aware of contrasting opinions. As a result, they argue that FINRA should require specific disclosures.
The supplementary material states that products may lead to different recommendations or ratings, provided that each is consistent with the member's ratings system for each respective product. In other words, all differing recommendations or ratings must be reconcilable such that they are not truly at odds with one another. Since the proposals would not allow inconsistent recommendations that could mislead one or more investors, FINRA stated that it believes general disclosure of alternative products with different objectives and recommendations is appropriate relative to its investor protection benefits. The commenter who supported this approach noted FINRA's position with approval in its comment regarding Amendment No. 1.
The proposal would eliminate or reduce the quiet periods during which a member may not publish or otherwise distribute research reports or make a public appearance following its participation in an offering. Citing recent enforcement actions in the research area, one commenter did not support elimination or reduction of the quiet periods.
This commenter restated its objection to the shortened quiet periods mandated by the proposal in its comments regarding Amendment No. 1. The commenter noted that “[t]he current quiet periods allow firms to `cool off' after the completion of certain activities before their research departments can offer coverage on the subject securities or issuers” and that the commenter had concerns that the shortened periods would lead to more promises of favorable research due to the research being distributed more quickly.
Other commenters requested that FINRA retain the exceptions in NASD Rule 2711(f) that permits: (i) The publication and distribution of research or a public appearance concerning the effects of significant news or a significant event on the subject company during the quiet period; and (ii) the publication of distribution of research pursuant to Rule 139 under the Securities Act of 1933.
One commenter with regards to the institution of proceedings suggested that FINRA clarify that the proposal would not interfere with senior managers who oversee research departments along with other non-research departments as they represent is the practice at a number of smaller firms, including pre-publication review by such managers.
This commenter also suggested that FINRA interpret selling concessions from public financings be permitted to be included in compensation decisions for research analysts. This commenter stated that this is because “[b]eing that analysts take part in these [sic] sale efforts, they should be permitted to be compensated from these specific sources of revenue.”
Two commenters opposed the requirement in the proposal that members disclose, in an equity research report, if they or their affiliates maintain a significant financial interest in the debt of the research company.
One commenter regarding the institution of proceedings had concerns that the provision in the proposal requiring disclosure of when a member “expects to receive or intends to seek” investment banking compensation provides no meaningful disclosure, could mandate disclosure of material, non-public information, and is overly burdensome to track.
One commenter asked FINRA to confirm in any Regulatory Notice announcing adoption of the proposed rule change that provisions relating to research coverage and budget decisions and joint due diligence are intended to supersede the corresponding terms of the Global Research Analyst Settlement
One commenter opposed the provision that would give FINRA the authority to grant, in exceptional or unusual circumstances, an exemption from the requirement of the proposed rule for good cause shown.
One commenter requested that the implementation date be at least 12 months after Commission approval of the proposed rule change.
Section 15D requires the Commission, or upon the authorization and direction of the Commission, a registered securities association or national securities exchange to have adopted, not later than July 30, 2003, rules reasonably designed to address conflicts of interest that can arise when securities analysts recommend equity securities in research reports and public appearances, in order to improve the objectivity of research and provide investors with more useful and reliable information, including rules designed to address certain specific requirements.
Section 15D requires a number of specific provisions, all of which are present in the proposed rule change in the form of required policies and procedures of members. Specifically, the proposed rule change will include rules designed (1) to foster greater public confidence in securities research, and to protect the objectivity and independence of securities analysts, by (a) restricting the prepublication clearance or approval of research reports by persons employed by the broker or dealer who are engaged in investment banking activities, or persons not directly responsible for investment research, other than legal or compliance staff,
Further, the proposed rule change mandates the disclosures required by section 15D. Specifically, the proposed rule change requires disclosure of (1) the extent to which the securities analyst has debt or equity investments in the issuer that is the subject of the appearance or research report;
The JOBS Act prohibits certain rules by national securities associations with regards to research reports regarding EGCs. Specifically, section 105(b) of the JOBS Act amended section 15D of the Act to prohibit the Commission or a national securities association registered under section 15A of the Act from adopting or maintaining any rule or regulation in connection with an IPO of the common equity of an EGC that either (1) restricts, based on functional role, which associated persons of a broker, dealer, or member of a national securities association, may arrange for communications between an analyst and a potential investor;
One commenter noted that, because joint meetings are permitted by the JOBS Act, the provision in the proposal prohibiting joint due diligence conferences should be clarified.
The Commission has carefully considered the proposed rule change, all of the comments received, and FINRA's responses to the comments. Based on its review of the record, the Commission finds that the proposed rule change, as amended by Amendment No. 1, is consistent with the requirements of the Act and the rules and regulations thereunder applicable to a national securities association.
FINRA stated in their proposal that it “believes the proposed rule change protects investors and the public interest by maintaining, and in some cases expanding, structural safeguards to insulate research analysts from influences and pressures that could compromise the objectivity of research reports and public appearances on which investors rely to make investment decisions” and “that the proposed rule change prevents fraudulent and manipulative acts and practices by requiring firms to identify and manage, often with extensive disclosure, conflicts of interest related to the preparation, content and distribution of research.”
The Commission generally agrees with these assertions. The Commission
Further, the proposed rule change includes new provisions that help ensure investor protection. For example, the proposed rule would require research management make independent decisions regarding research coverage,
Regarding concerns raised by commenters regarding the principles-based structure of the proposal, we note the proposed rule change retains the key provisions of NASD Rule 2711 and includes a number of new protections for investors including the requirement that research management make independent decisions regarding research coverage,
In approving this proposal, however, we expect that FINRA will continue to monitor the effectiveness of the rule proposal and modify the rule, or issue further guidance as promised, should it prove to be unworkable or fail to provide the same level of protection to investors as provided NASD Rule 2711.
For the reasons stated above, the Commission finds that the proposed rule change is consistent with the Act and the rules and regulations thereunder.
IT IS THEREFORE ORDERED, pursuant to section 19(b)(2) of the Act,
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(7) of the Securities Exchange Act of 1934 (the “Act”),
OneChicago is proposing to amend OCX Rule 905 (Form of Specifications Supplement) to add spreads to the types of transactions to which four (4) decimal pricing applies.
OneChicago is concurrently issuing NTM 2015-23. The NTM informs market participants that OneChicago is amending OCX Rule 905 and that the Exchange is reducing the minimum price fluctuation for spread transactions to $0.0001.
The text of the proposed rule change is attached as
In its filing with the Commission, OneChicago included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The self-regulatory organization has prepared a summary of the most significant aspects of such statements.
OneChicago is proposing to amend OCX Rule 905 (Form of Specifications Supplement) to decrease the minimum fluctuation for spreads to $0.0001 from $0.01. In 2011, OneChicago similarly amended the pricing of block and EFP transactions to allow for four decimal point trade prices.
OneChicago is now adding spreads to the types of trades to which four decimal pricing applies. OneChicago believes that this change will also allow spreads to be more efficiently priced, consistent with how blocks and EFPs are currently priced. The additional precision will aid in aligning these trades with the appropriate implied interest rate desired by market participants.
OneChicago believes that the proposed rule change is consistent with Section 6(b) of the Act,
The proposed rule change will allow all market participants to price their spread trades more accurately. Since the price difference between the buy and the sell in a spread trade reflects the interest rate component of the trade, the pricing of this component in four decimal places allows market participants to tailor their trade prices to their desired interest rate levels.
The Exchange believes that the proposed rule change and associated NTM are equitable and not unfairly discriminatory because they would apply equally to all market participants. The ability to trade spreads in four decimal places will not be limited to any class of market participant.
OneChicago does not believe that the rule change and associated NTM will impose any burden on competition not necessary or appropriate in furtherance of the purposes of the Act, in that the rule change and associated NTM simply allow an additional type of transaction to be priced in four decimal places. This change will allow all market participants to more accurately price the interest rate component of their spread transactions.
No written comments were solicited or received with respect to the proposed rule change.
The rule amendment and NTM will become operative on July 20, 2015.
At any time within 60 days of the date of effectiveness of the proposed rule change, the Commission, after consultation with the CFTC, may summarily abrogate the proposed rule change and require that the proposed rule change be refiled in accordance with the provisions of Section 19(b)(1) of the Act.
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Brent J. Fields, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1)
The proposed rule change
In its filing with the Commission, DTC included statements concerning the purpose of, and basis for, the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. DTC has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The purpose of the proposed rule filing is to amend: (i) The Guide so that Participants would be able to elect to receive one or both of the Files and (ii) the Fee Schedule to add Participant fees relating to the Files, as set forth below.
Transactional Information and Settlement Balance Information are available to Participants in real-time via DTC's Settlement User Interface (“Interface”).
In order to enhance the ability of Participants to efficiently access Transactional Information and Settlement Balance Information on a cost effective basis, the proposed rule change would revise the Guide to allow Participants to elect to receive one or both Files, for a monthly fee per File.
The Fee Guide would be amended to add the following Participant fees for access to the Files:
The effective date of the proposed rule change would be July 1, 2015.
The proposed rule change is designed to promote the prompt and accurate clearance and settlement of securities transactions by enhancing access to information for Participants. The proposed fees as set forth above would apply equally for Participants that elect to receive Files. Therefore, DTC believes that the proposed rule change is consistent with the requirements of the Act and the rules and regulations thereunder applicable to DTC, in particular: (i) Section 17A(b)(3)(F)
DTC does not believe that the proposed rule change would have any impact, or impose any burden, on competition.
Written comments relating to the proposed rule change have not yet been solicited or received. DTC will notify the Commission of any written comments received by DTC.
The foregoing rule change has become effective pursuant to Section 19(b)(3)(A)
Interested persons are invited to submit written data, views and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Brent J. Fields, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
On March 31, 2015, NYSE Arca, Inc. (“Exchange” or “NYSE Arca”) filed with the Securities and Exchange Commission (“Commission”), pursuant to Section 19(b)(1)
NYSE Arca proposes to list and trade Shares of the Funds under NYSE Arca Equities Rule 5.2(j)(3), Commentary .02, which governs the listing and trading of Investment Company Units (“Units”) based on fixed income securities indexes. The Funds are two series of the iShares Trust (“Trust”).
The iShares iBonds Dec 2021 AMT-Free Muni Bond ETF will seek to track the investment results of the S&P AMT-Free Municipal Series December 2021 Index
The 2021 Index includes municipal bonds primarily from issuers that are state or local governments or agencies such that the interest on the bonds is exempt from U.S. federal income taxes and the federal alternative minimum tax (“AMT”). Each bond must have a rating of at least BBB− by Standard & Poor's Ratings Services (“S&P”), Baa3 by Moody's Investors Service, Inc. (“Moody's”), or BBB− by Fitch Ratings, Inc. (“Fitch”) and must have a minimum maturity par amount of $2 million to be eligible for inclusion in the 2021 Index. To remain in the 2021 Index, bonds must maintain a minimum par amount greater than or equal to $2 million as of each rebalancing date. All bonds in the 2021 Index will mature after December 31, 2020 and before December 2, 2021. When a bond matures in the 2021 Index, an amount representing its value at maturity will be included in the 2021 Index throughout the remaining life of the 2021 Index, and any such amount will be assumed to earn a rate equal to the performance of the Standard & Poor's Financial Services LLC's Weekly High Grade Index, municipal tax-exempt notes that are not subject to federal AMT. The 2021 Index is a market value weighted index and is rebalanced after the market close on the last business day of each month.
The Exchange submitted this proposed rule change because the 2021 Index does not meet all of the generic listing requirements of Commentary .02(a) to NYSE Arca Equities Rule 5.2(j)(3) applicable to the listing of Units based on fixed income securities indexes. The Exchange represents that the 2021 Index meets all such requirements except for those set forth in Commentary .02(a)(2), which requires that components that in the aggregate account for at least 75% of the weight of the index each have a minimum original principal amount outstanding of $100 million or more. As of February 10, 2015, components of the 2021 Index that satisfied the $100 million or more minimum original principal amount outstanding requirement constituted only 6.8% of the weight of the index.
In general, the Fund will invest at least 80% of its assets in the securities of the 2021 Index, except during the last months of the Fund's operations, and may invest the remainder of its assets in cash, cash equivalents, and municipal bonds not included in the 2021 Index, but which BFA believes will help the Fund track the 2021 Index. In the last months of operation, as the bonds held by the Fund mature, the proceeds will not be reinvested in bonds but instead will be held in cash and cash equivalents. These cash equivalents may not be included in the 2021 Index. Around December 1, 2021, the Fund will wind up and terminate, and its net assets will be distributed to then-current shareholders.
The iShares iBonds Dec 2022 AMT-Free Muni Bond ETF will seek to track
The 2022 Index includes municipal bonds primarily from issuers that are state or local governments or agencies such that the interest on the bonds is exempt from U.S. federal income taxes and the federal AMT. Each bond must have a rating of at least BBB− by S&P, Baa3 by Moody's, or BBB− by Fitch Ratings, Inc. and must have a minimum maturity par amount of $2 million to be eligible for inclusion in the 2022 Index. To remain in the 2022 Index, bonds must maintain a minimum par amount greater than or equal to $2 million as of each rebalancing date. All bonds in the 2022 Index will mature in after December 31, 2021 and before December 2, 2022. When a bond matures in the 2022 Index, an amount representing its value at maturity will be included in the 2022 Index throughout the remaining life of the 2022 Index, and any such amount will be assumed to earn a rate equal to the performance of the Standard & Poor's Financial Services LLC's Weekly High Grade Index, which consists of Moody's Investment Grade-1 municipal tax-exempt notes that are not subject to federal AMT. The 2022 Index is a market value weighted index and is rebalanced after the market close on the last business day of each month.
The Exchange submitted this proposed rule change because the 2022 Index does not meet all of the generic listing requirements of Commentary .02(a) to NYSE Arca Equities Rule 5.2(j)(3) applicable to the listing of Units based on fixed income securities indexes. The Exchange represents that the 2022 Index meets all such requirements except for those set forth in Commentary .02(a)(2), which requires that components that in the aggregate account for at least 75% of the weight of the index each have a minimum original principal amount outstanding of $100 million or more. As of February 10, 2015, components of the 2022 Index that satisfied the $100 million or more minimum original principal amount outstanding requirement constituted only 5.8% of the weight of the index.
In general, the Fund will invest at least 80% of its assets in components of the 2022 Index, except during the last months of the Fund's operations, and may invest the remainder of its assets in cash, cash equivalents, and municipal bonds not included in the 2022 Index but which BFA believes will help the Fund track the 2022 Index. In the last months of operation, as the bonds held by the Fund mature, the proceeds will not be reinvested in bonds but instead will be held in cash and cash equivalents. These cash equivalents may not be included in the 2022 Index. Around December 1, 2022, the Fund will wind up and terminate, and its net assets will be distributed to then-current shareholders.
After careful review, the Commission finds that the Exchange's proposal to list and trade the Shares is consistent with the Exchange Act and the rules and regulations thereunder applicable to a national securities exchange.
The Commission finds that the proposal to list and trade the Shares on the Exchange is consistent with Section 11A(a)(1)(C)(iii) of the Exchange Act,
Based on the Exchange's representations, the Commission believes that both the 2021 Index and 2022 Index are sufficiently broad-based and liquid to deter potential manipulation. As of February 10, 2015, there were 4,217 issues in the 2021 Index and 3,473 issues in the 2022 Index. In addition, the total dollar amount outstanding of issues in the 2021 Index was approximately $38.9 billion and the average dollar amount outstanding of issues in the 2021 Index was approximately $9.2 million; and the total dollar amount outstanding of issues in the 2022 Index was approximately $30.5 billion, and the average dollar amount outstanding of issues in the 2022 Index was approximately $8.8 million. Further, the most heavily weighted component represents 0.57% of the weight of the 2021 Index, and the five most heavily weight components represent 2.51% of the 2021 Index; and the most heavily weighted component represents 0.55% of the weight of the 2022 Index, and the five most heavily weight components represent 2.67% of the 2022 Index.
In support of this proposal, the Exchange has also made the following representations:
(1) The Exchange deems the Shares to be equity securities, thus rendering trading in the Shares subject to the Exchange's existing rules governing the trading of equity securities.
(2) Except for Commentary .02(a)(2) to NYSE Arca Equities Rule 5.2(j)(3), the 2021 Index and 2022 Index currently satisfy all of the generic listing standards under NYSE Arca Equities Rule 5.2(j)(3).
(3) The continued listing standards under NYSE Arca Equities Rules 5.2(j)(3) and 5.5(g)(2) applicable to Units shall apply to the Shares.
(4) The Shares will comply with all other requirements applicable to Units including, but not limited to, requirements relating to the dissemination of key information such as the value of the 2021 Index and 2022 Index, respectively, and the IIV, rules governing the trading of equity securities, trading hours, trading halts, surveillance, and the Information Bulletin to Equity Trading Permit Holders (each as described in more detail herein and in the Notice and Registration Statements, as applicable), as set forth in Exchange rules applicable to Units and prior Commission orders approving the generic listing rules applicable to the listing and trading of Units.
(5) Trading in the Shares will be subject to the existing trading surveillances, administered by FINRA on behalf of the Exchange, which are designed to detect violations of Exchange rules and applicable federal securities laws, and these procedures are adequate to properly monitor Exchange trading of the Shares in all trading sessions and to deter and detect violations of Exchange rules and federal securities laws applicable to trading on the Exchange.
(6) For initial and/or continued listing, the Funds will be in compliance with Rule 10A-3
(7) The Exchange has appropriate rules to facilitate transactions in the Shares during all trading sessions.
(8) Prior to the commencement of trading, the Exchange will inform its Equity Trading Permit Holders in a Bulletin of the special characteristics and risks associated with trading the Shares. Specifically, the Bulletin will discuss the following: (a) The procedures for purchases and redemptions of Shares in Creation Unit aggregations (and that Shares are not individually redeemable); (b) NYSE Arca Equities Rule 9.2(a), which imposes a duty of due diligence on its Equity Trading Permit Holders to learn the essential facts relating to every customer prior to trading the Shares; (c) the risks involved in trading the Shares during the Opening and Late Trading Sessions when an updated IIV will not be calculated or publicly disseminated; (d) how information regarding the IIV is disseminated; (e) the requirement that Equity Trading Permit Holders deliver a prospectus to investors purchasing newly issued Shares prior to or concurrently with the confirmation of a transaction; and (f) trading information.
(9) A minimum of 100,000 Shares for each Fund will be outstanding at the commencement of trading on the Exchange.
This approval order is based on all of the Exchange's representations, including those set forth above and in the Notice.
For the foregoing reasons, the Commission finds that the proposed rule change, as modified by Amendment
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the “Act”),
The proposed rule change proposes to amend the Exchange's rules related to its Automated Improvement Mechanism (“AIM”). The text of the proposed rule change is provided below.
Notwithstanding the provisions of Rule 6.50, a Participant that represents agency orders may electronically execute an order it represents as agent (“Agency Order”) against principal interest or against a solicited order provided it submits the Agency Order for execution into the AIM auction (“Auction”) pursuant to this Rule.
(a)-(b) No change.
.01-.02 No change.
.03 Initially, and for at least a Pilot Period expiring on July 18, 201[5]
.04-.09 No change.
The text of the proposed rule change is also available on the Exchange's website (
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
In December 2009, the Securities and Exchange Commission (the “Commission”) approved adoption of C2's rules, including the AIM auction process.
The Commission approved on a pilot basis the component of AIM that there is no minimum size requirement for orders to be eligible for the auction. In connection with the pilot programs, the Exchange has submitted to the Commission reports providing detailed AIM auction and order execution data. The Exchange will provide the Commission six months of additional AIM auction and order execution data for the period of January 1, 2015 to June 30, 2015 no later than January 18, 2016. The raw data provided will be submitted on a confidential basis. In addition, the Exchange will submit tables summarizing AIM price improvement statistics for each month of the January 1, 2015 to June 30, 2015 period. The summary tables will be made available to the public. Five one-year extensions to the pilot program have previously become effective.
The Exchange believes the proposed rule change is consistent with the Securities Exchange Act of 1934 (the “Act”) and the rules and regulations thereunder applicable to the Exchange and, in particular, the requirements of Section 6(b) of the Act.
In particular, the proposed rule change protects investors and the public interest by allowing for an extension of the AIM pilot program, and thus allowing additional time for the Commission to evaluate the AIM pilot program. The AIM pilot program will continue to allow smaller orders to receive the opportunity for price improvement pursuant to the AIM auction. The additional data provided will help the Commission determine if there is evidence of meaningful competition for all size orders, significant price improvement for orders going through the AIM and an active and liquid market functioning on the Exchange outside of the AIM Auction.
C2 does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. The Exchange does not believe the proposed rule change imposes any burden on intramarket competition because it applies to all Trading Permit Holders. All Trading Permit Holders that submit orders into an AIM auction are still subject to the same requirements. In addition, the Exchange does not believe the proposed rule change will impose any burden on intermarket competition, as it merely extends the duration of an existing pilot program, which is available to all market participants through Trading Permit Holders. AIM will continue to function in the same manner as it currently functions for an extended period of time.
The Exchange neither solicited nor received comments on the proposed rule change.
Because the foregoing proposed rule change does not: (i) Significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A) of the Act
A proposed rule change filed under Rule 19b-4(f)(6)
The Commission believes that waiving the 30-day operative delay is consistent with the protection of investors and the public interest, as it will allow the pilot program to continue uninterrupted, thereby avoiding any potential investor confusion that could result from a temporary interruption in the pilot program. Therefore, the Commission designates the proposed rule change to be operative on July 18, 2015.
At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act. If the Commission takes such action, the Commission shall institute proceedings to determine whether the proposed rule should be approved or disapproved.
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Brent J. Fields, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the “Act”)
The MSRB filed with the Commission a proposed rule change consisting of an amendment to MSRB Rule G-45, on reporting of information on municipal fund securities (“proposed rule change”). The proposed rule change would delay by 60 days, until October 28, 2015, the date on which the first submissions must be made pursuant to Rule G-45. The first submissions on Form G-45 currently are due August 29, 2015. The MSRB proposes an immediate effectiveness for the proposed rule change. The proposed rule change would extend by 60 days the due date under a previously approved rule for the first submissions on Form G-45.
The text of the proposed rule change is available on the MSRB's Web site at
In its filing with the Commission, the MSRB included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The MSRB has prepared summaries, set forth in Sections A, B, and C below, of the most significant aspects of such statements.
The MSRB proposes to extend by 60 days until October 28, 2015 the date the first submissions are due under Rule G-45 on Form G-45. On February 21, 2014, the Commission approved the adoption of Rule G-45, on reporting of municipal fund securities, and electronic Form G-45, as well as associated amendments to Rules G-8, on books and records, and G-9, on preservation of records.
After the SEC's approval of Rule G-45 and Form G-45, MSRB staff formed an industry User Group to develop the Form G-45 User's Manual (the “manual”), which the rule specifies would include technical specifications for the Form, such as data entry. User Group members include representatives from twelve different industry organizations ranging from organizations that are involved in the distribution of multiple 529 plans to those that participate in the distribution of interests in only one plan. The range of expertise of User Group members includes data services provision and program management.
The User Group recommended that underwriters be afforded two methods of submitting data to the MSRB on Form G-45—manual submissions through the MSRB's Electronic Municipal Market Access Web site (“EMMA®”)
In February 2015, the MSRB released the manual and opened a beta test environment to assist underwriters with their submissions. Since that time, underwriters and industry trade groups have discussed with MSRB staff the challenges that underwriters are facing with programming the data for submission to the Board on Form G-45. Their concerns center on the ability to program automated B2B submissions, particularly information about investment options in 529 plans.
529 plans typically offer numerous investment options with multiple underlying mutual funds. To gather adequate information about 529 plans, Form G-45 requires detailed data about the various investment options available in 529 plans. The MSRB understands that the programming of such information for a Form G-45 submission is particularly challenging for underwriters because the required data must be collected from multiple computer systems. While the programmers for underwriters may be challenged by meeting the unextended deadline for the first filings on Form G-45, after the first B2B filing, the process would be automated and is expected to become more routine.
To help ensure that the MSRB receives reliable, complete and accurate filings on Form G-45 and to mitigate the burdens imposed on underwriters that are making their first submission under Rule G-45, the MSRB submits this proposed rule change to extend the date that the first submissions on Form G-45 are due by 60 days, until October 28, 2015. The proposed rule change would double the time allowed for
The MSRB believes that the proposed rule change is consistent with Section 15B(b)(2)(C) of the Act,
In response to industry concerns about the ability to submit reliable, accurate and complete data on a timely basis, the proposed rule change would extend the date that the first submissions are due under a previously approved rule.
Section 15B(b)(2)(C) of the Act
Written comments were neither solicited nor received on the proposed rule change.
Pursuant to Section 19(b)(3)(A)
A proposed rule change filed under Rule 19b-4(f)(6) normally does not become operative until 30 days after the date of filing.
The Commission hereby grants the MSRB's request and believes that designating the proposed rule change operative upon filing is consistent with the protection of investors and the public interest.
At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act.
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549.
For the Commission, pursuant to delegated authority.
Pursuant to Section 19(b)(1)
The Exchange proposes to reflect a change in the size of a Creation Unit applicable to shares of the PIMCO Total Return Active Exchange-Traded Fund from 100,000 Shares to at least 50,000 Shares. The Fund is currently listed and traded on the Exchange under NYSE Arca Equities Rule 8.600. The text of the proposed rule change is available on the Exchange's Web site at
In its filing with the Commission, the self-regulatory organization included statements concerning the purpose of, and basis for, the proposed rule change and discussed any comments it received on the proposed rule change. The text of those statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant parts of such statements.
The Commission has approved a proposed rule change relating to listing and trading on the Exchange of shares (“Shares”) of the PIMCO Total Return Active Exchange-Traded Fund (“Fund”) under NYSE Arca Equities Rule 8.600,
According to the Registration Statement and the Prior Release, Shares of the Fund that trade in the secondary market are created at net asset value (“NAV”) by Authorized Participants only in block-size Creation Units of 100,000 Shares or multiples thereof.
The Exchange proposes to reflect a change in the size of a Creation Unit from 100,000 Shares to at least 50,000 Shares.
The Adviser represents that the proposed change to reduce the size of a Creation Unit, as described above, is consistent with the Fund's investment objective, and will further assist the Adviser to achieve such investment objective. Except for the change noted above, all other representations made in the Prior Release remain unchanged.
The basis under the Act for this proposed rule change is the requirement under Section 6(b)(5)
The proposed rule change is designed to perfect the mechanism of a free and open market and, in general, to protect investors and the public interest. The Exchange believes that the change to the size of a Creation Unit to at least 50,000 Shares will not adversely impact investors or Exchange trading. In addition, a reduction in the size of a Creation Unit may provide potential benefits to investors by facilitating additional creation and redemption activity in the Shares, thereby potentially resulting in increased secondary market trading activity, tighter bid/ask spreads and narrower premiums or discounts to NAV.
The Exchange does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purpose of the Act. The Exchange believes the proposed rule change, because of the potential increase in secondary market trading activity that may result from a decrease in the Creation Unit size for Shares of the Fund, will enhance competition among issues of exchange-traded funds that invest in fixed income securities.
No written comments were solicited or received with respect to the proposed rule change.
Because the foregoing proposed rule change does not: (i) Significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, if consistent with the protection of investors and the public interest, the proposed rule change has become effective pursuant to Section 19(b)(3)(A) of the Act
At any time within 60 days of the filing of the proposed rule change, the Commission may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act. If the Commission takes such action, the Commission shall institute proceedings to determine whether the proposed rule change should be approved or disapproved.
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”),
The Exchange proposes to amend Exchange Rule 1080(n), Price Improvement XL (“PIXL
Proposed new text is
(a)-(m) No change.
(n) Price Improvement XL (“PIXL”)
A member may electronically submit for execution an order it represents as agent on behalf of a public customer, broker-dealer, or any other entity (“PIXL Order”) against principal interest or against any other order (except as provided in sub-paragraph (n)(i)(F) below) it represents as agent (an “Initiating Order”) provided it submits the PIXL Order for electronic execution into the PIXL Auction (“Auction”) pursuant to this Rule. The contract size specified in Rule 1080(n) as applicable to PIXL Orders shall apply to Mini Options.
(i) Auction Eligibility Requirements. All options traded on the Exchange are eligible for PIXL. A member (the “Initiating Member”) may initiate an Auction provided all of the following are met:
(A) No change.
(B) No change.
(C) If the PIXL Order is a Complex Order and of a conforming ratio, as defined in Commentary.08(a)(i) and (a)(ix) to Rule 1080, the Initiating Member must stop the entire PIXL order at a price that is better than the best net price (debit or credit) (i) available on the Complex Order book regardless of the Complex Order book size; and (ii) achievable from the best Phlx bids and offers for the individual options (an “improved net price”), provided in either case that such price is equal to or better than the PIXL Order's limit price. Complex Orders consisting of a ratio other than a conforming ratio will not be accepted. This sub-paragraph (C) shall apply to all Complex Orders submitted into PIXL. This sub-paragraph (C), where applied to Complex Orders where the smallest leg is less than 50 contracts in size, shall be effective for a pilot period scheduled to expire July 18, 201[5]
(D)-(G) No change.
(ii) Auction Process. Only one Auction may be conducted at a time in any given series or strategy. Once commenced, an Auction may not be cancelled and shall proceed as follows:
(A) No change.
(B) Conclusion of Auction. The PIXL Auction shall conclude at the earlier to occur of (1) through (4) below, with the PIXL Order executing pursuant to paragraph (C)(1) through (3) below.
(1)-(4) No change.
(5) Sub-paragraphs (B)(2), (B)(3) and (B)(4) above shall be effective for a pilot period scheduled to expire July 18, 201[5]
(C) No change.
(D) An unrelated market or marketable limit order (against the PBBO) on the opposite side of the market from the PIXL Order received during the Auction will not cause the Auction to end early and will execute against interest outside of the Auction. In the case of a Complex PIXL Auction, an unrelated market or marketable limit Complex Order on the opposite side of the market from the Complex PIXL Order as well as orders for the individual components of the Complex Order received during the Auction will not cause the Auction to end early and will execute against interest outside of the Auction. If contracts remain from such unrelated order at the time the Auction ends, they will be considered for participation in the order allocation process described in sub-paragraph (E) below. This sub-paragraph shall be effective for a pilot period scheduled to expire on July 18, 201[5]
(E)-(J) No change.
(iii)-(vi) No change.
(vii) Initially, and for at least a Pilot Period expiring on July 18, 201[5]
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
The purpose of the proposed rule change is to extend the pilot through July 18, 2016.
The Exchange adopted PIXL in October 2010 as a price-improvement mechanism on the Exchange.
An Initiating Member may initiate a PIXL Auction by submitting a PIXL Order, which is not a Complex Order, in one of three ways:
• First, the Initiating Member could submit a PIXL Order specifying a single price at which it seeks to execute the PIXL Order (a “stop price”).
• Second, an Initiating Member could submit a PIXL Order specifying that it is willing to automatically match as principal or as agent on behalf of an Initiating Order the price and size of all trading interest and responses to the PIXL Auction Notification (“PAN,” as described below) (“auto-match”), in which case the PIXL Order will be stopped at the National Best Bid/Offer (“NBBO”) on the Initiating Order side.
• Third, an Initiating Member could submit a PIXL Order specifying that it is willing to either: (i) Stop the entire order at a single stop price and auto-match PAN responses, as described below, together with trading interest, at a price or prices that improve the stop price to a specified price above or below which the Initiating Member will not trade (a “Not Worse Than” or “NWT” price); (ii) stop the entire order at a single stop price and auto-match all PAN responses and trading interest at or better than the stop price; or (iii) stop the entire order at the NBBO on the Initiating Order side, and auto-match PAN responses and trading interest are at a price or prices that improve the stop price up to the NWT price. In all cases, if the PHLX Best Bid/Offer (“PBBO”) on the same side of the market as the PIXL Order represents a limit order on the book, the stop price must be at least one minimum price improvement increment better than the booked limit order's limit price.
In addition, an Initiating Member may initiate a PIXL Auction by submitting a Complex Order which is of a conforming ratio, as defined in Commentary .08(a)(i) and (a)(ix) to Rule 1080. When submitting a Complex Order, the Initiating Member must stop the PIXL order at a price that is better than the best net price (debit or credit) (i) available on the Complex Order book regardless of the Complex Order book size; and (ii) achievable from the best PHLX bids and offers for the individual options (an “improved net price”), provided in either case that such price is equal to or better than the PIXL Order's limit price.
After the PIXL Order is entered, a PAN is broadcast and a one-second blind Auction ensues. Anyone may respond to the PAN by sending orders or quotes. At the conclusion of the Auction, the PIXL Order will be allocated at the best price(s).
Once the Initiating Member has submitted a PIXL Order for processing, such PIXL Order may not be modified or cancelled. Under any of the above circumstances, the Initiating Member's stop price or NWT price may be improved to the benefit of the PIXL Order during the Auction, but may not be cancelled.
After a PIXL Order has been submitted, a member organization submitting the order has no ability to control the timing of the execution. The execution is carried out by the Exchange's PHLX XL automated options trading system and pricing is determined solely by the other orders and quotes that are present in the Auction.
Three components of the PIXL system were approved by the Commission on a pilot basis: (1) Paragraphs (n)(i)(A)(2),
In further support of this proposed rule change, the Exchange would continue to submit to the Commission detailed data from, and analysis of, the PIXL pilot. Further, the Exchange will provide certain additional data requested by the Commission regarding trading in the PIXL Auction for the six (6) month period from January 1, 2015 through June 30, 2015. The Exchange agrees to provide this data by January 18, 2016 and to make the summary of the data provided to the Commission publicly available. The Exchange continues to believe that there remains meaningful competition for all size orders and that there is an active and liquid market functioning on the Exchange outside of the PIXL Auction and that there is significant price improvement for orders entered into the PIXL Auction. The Exchange believes the additional data will substantiate the Exchange's belief and provide further evidence in support of permanent approval of the PIXL Pilot.
The Exchange proposes to extend the pilot through July 18, 2016. The Exchange believes that the proposed extension should afford the Commission additional time to evaluate the pilot.
The Exchange believes that the proposed rule change is consistent with the provisions of Section 6 of the Act,
The Exchange believes that the proposed rule change is also consistent with Section 6(b)(8) of the Act
Specifically, the Exchange believes that PIXL, including the rules to which the pilot applies, results in increased liquidity available at improved prices, with competitive final pricing out of the Initiating Member's complete control. The Exchange believes that PIXL promotes and fosters competition and affords the opportunity for price improvement to more options contracts. The extension proposal allows additional time for the Commission to evaluate the pilot.
The Exchange does not believe that the proposed rule change will impose any burden on competition not necessary or appropriate in furtherance of the purposes of the Act. The proposal extends existing pilots that apply to all Exchange members, and enables the Exchange to be competitive in respect of other option exchanges that have similar programs.
No written comments were either solicited or received.
Because the foregoing proposed rule change does not: (i) Significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A) of the Act
A proposed rule change filed under Rule 19b-4(f)(6)
The Commission believes that waiving the 30-day operative delay is consistent with the protection of investors and the public interest, as it will allow the PIXL pilot to continue uninterrupted, thereby avoiding any potential investor confusion that could result from a temporary interruption in the pilot. Therefore, the Commission designates the proposed rule change to be operative on July 18, 2015.
At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act.
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
On May 15, 2015, NYSE Arca, Inc. (the “Exchange” or “NYSE Arca”) filed with the Securities and Exchange Commission (the “Commission”), pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the “Act” or “Exchange Act”)
NYSE Arca proposes to list and trade shares of the Fund under NYSE Arca Equities Rule 8.600, which governs the listing and trading of Managed Fund Shares.
The Adviser is not a registered broker-dealer but is affiliated with a broker-dealer and has implemented a “fire wall” with respect to such broker-dealer regarding access to information concerning the composition and/or changes to the Fund's portfolio.
The Fund will seek to provide long-term total return. In seeking long-term total return, the Adviser will target a return that exceeds one-month London Interbank Offered Rate (“LIBOR”) by at least 4% every year over a five-year investment timeframe. According to the Exchange, the Fund will be actively managed and will not seek to replicate the performance of a specified index.
Under normal circumstances,
The Adviser will seek to gain exposure to a wide range of asset classes, including real estate; equity and fixed income securities, including high yield debt securities; commodities; instruments that seek to track movements in volatility indices; and cash and cash equivalents or money market instruments. Under normal circumstances, the Portfolio will invest at least 80% of its net assets in ETPs,
While under normal circumstances, the Adviser will invest at least 80% of the Portfolio's net assets as described in the Principal Investments section, above, the Adviser may invest up to 20% of the Portfolio's net assets in other securities and financial instruments, as described below.
The Portfolio may hold in the following types of assets:
• Equities securities other than ETPs mentioned above,
• Fixed income securities, including U.S. government and U.S. government agency securities; repurchase agreements and reverse repurchase agreements; bonds, including sovereign debt and U.S. registered, dollar-denominated bonds of foreign corporations, governments, agencies and supra-national entities; convertible securities; short term instruments, including money market instruments; inflation-protected public obligations, commonly known as “TIPS,” of the U.S. Treasury, as well as TIPS of major governments and emerging market countries; and variable and floating rate securities, including variable rate demand notes and variable rate demand obligations.
• Cash and cash equivalents.
• Restricted securities, including equity and fixed income restricted securities.
• The following types of derivatives: Exchange-listed and non-exchange listed options (other than the equity options mentioned above), swaps, forward contracts, and futures contracts (other than the VIX Futures mentioned above). The derivatives that the Portfolio invests in may be based on equity or fixed income securities and/or equity or fixed income indices, currencies, and interest rates.
The Portfolio also may conduct foreign currency transactions on a spot (
After careful review, the Commission finds that the Exchange's proposal to list and trade the Shares is consistent with the Exchange Act and the rules and regulations thereunder applicable to a national securities exchange.
The Commission finds that the proposal to list and trade the Shares on the Exchange is consistent with Section 11A(a)(1)(C)(iii) of the Exchange Act,
The Commission also believes that the proposal to list and trade the Shares is reasonably designed to promote fair disclosure of information that may be necessary to price the Shares appropriately and to prevent trading when a reasonable degree of transparency cannot be assured. On
The Exchange will obtain a representation from the issuer of the Shares that the NAV per Share will be calculated daily and that the NAV and the Disclosed Portfolio will be made available to all market participants at the same time. In addition, the Indicative Optimized Portfolio Value (“IOPV”) of the Fund, which is the Portfolio Indicative Value as defined in NYSE Arca Equities Rule 8.600 (c)(3), will be widely disseminated at least every 15 seconds during the Exchange's Core Trading Session by one or more major market data vendors. The Custodian, through the National Securities Clearing Corporation, will make available on each Business Day, immediately prior to the opening of business on the Exchange (currently 9:30 a.m., Eastern Time (“E.T.”)), the list of the names and the required number of shares of each Deposit Security or the required amount of Deposit Cash, as applicable, to be included in the current Fund Deposit (based on information at the end of the previous Business Day) for the Fund. The NAV of the Portfolio will be calculated by the Custodian and determined at the close of the regular trading session on the New York Stock Exchange (ordinarily 4:00 p.m. E.T.) on each day that such exchange is open. The Fund's Web site will include a form of the prospectus for the Fund that may be downloaded and additional information relating to NAV and other applicable information.
The Exchange represents that trading in the Shares will be halted if the circuit breaker parameters in NYSE Arca Equities Rule 7.12 have been reached or because of market conditions or for reasons that, in the view of the Exchange, make trading in the Shares inadvisable.
The Exchange states that it has a general policy prohibiting the distribution of material, non-public information by its employees.
Prior to the commencement of trading, the Exchange will inform its Equity Trading Permit Holders in an Information Bulletin (“Bulletin”) of the special characteristics and risks associated with trading the Shares. The Exchange states that trading in the Shares will be subject to the existing trading surveillances, administered by the Financial Industry Regulatory Authority (“FINRA”) on behalf of the Exchange, which are designed to detect violations of Exchange rules and applicable federal securities laws.
The Exchange represents that it deems the Shares to be equity securities, thus rendering trading in the Shares subject to the Exchange's existing rules governing the trading of equity securities.
(1) The Shares of the Fund will conform to the initial and continued listing criteria under NYSE Arca Equities Rule 8.600.
(2) The Exchange has appropriate rules to facilitate transactions in the Shares during all trading sessions.
(3) Trading in the Shares will be subject to the existing trading surveillances, administered by FINRA on behalf of the Exchange, which are designed to detect violations of Exchange rules and applicable federal securities laws, and these procedures are adequate to properly monitor Exchange trading of the Shares in all trading sessions and to deter and detect violations of Exchange rules and federal securities laws applicable to trading on the Exchange.
(4) Prior to the commencement of trading, the Exchange will inform its Equity Trading Permit Holders in a Bulletin of the special characteristics and risks associated with trading the Shares. Specifically, the Bulletin will discuss the following: (a) The procedures for purchases and redemptions of Shares in Creation Unit aggregations (and that Shares are not individually redeemable); (b) NYSE Arca Equities Rule 9.2(a), which imposes a duty of due diligence on its ETP Holders to learn the essential facts relating to every customer prior to trading the Shares; (c) the risks involved in trading the Shares during the Opening and Late Trading Sessions when an updated IOPV will not be calculated or publicly disseminated; (d) how information regarding the IOPV and the Disclosed Portfolio is disseminated; (e) the requirement that Equity Trading Permit Holders deliver a prospectus to investors purchasing newly issued Shares prior to or concurrently with the confirmation of a transaction; and (f) trading information.
(5) For initial and/or continued listing, the Fund will be in compliance with Rule 10A-3
(6) While the Fund may invest in inverse ETFs, the Fund will not invest
(7) The Portfolio may invest up to 20% of its assets in derivatives.
(8) The Portfolio may invest up to 25% of its total assets in one or more ETPs that are QPTPs and whose principal activities are the buying and selling of commodities or options, futures, or forwards with respect to commodities.
(9) The Portfolio may invest up to 10% of its net assets in high yield debt securities.
(10) Not more than 10% of the net assets of the Fund will consist of equity securities that trade in markets that are not members of the ISG or are not parties to CSSA with the Exchange.
(11) The Fund may hold up to an aggregate amount of 15% of its net assets in illiquid assets (calculated at the time of investment), including Rule 144A securities deemed illiquid by the Adviser, consistent with Commission guidance. The Fund will monitor its portfolio liquidity on an ongoing basis to determine whether, in light of current circumstances, an adequate level of liquidity is being maintained, and will consider taking appropriate steps in order to maintain adequate liquidity if, through a change in values, net assets, or other circumstances, more than 15% of the Fund's net assets are held in illiquid assets.
(12) A minimum of 100,000 Shares will be outstanding at the commencement of trading on the Exchange.
This approval order is based on all of the Exchange's representations, including those set forth above and in the Notice.
For the foregoing reasons, the Commission finds that the proposed rule change, as modified by Amendment Nos. 1, 2, and 3, is consistent with Section 6(b)(5) of the Act
Interested persons are invited to submit written data, views, and arguments concerning whether Amendment Nos. 1, 2, and 3 is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.
The Commission finds good cause to approve the proposed rule change, as modified by Amendment Nos. 1, 2, and 3, prior to the 30th day after the date of publication of notice of the amendment in the
This information is useful for evaluating the likelihood of market participants engaging in effective arbitrage and the Exchange's ability to detect improper trading activity that impacts the price of the Shares. Accordingly, the Commission believes that Amendment Nos. 1, 2, and 3 are consistent with the provisions of Section 6(b)(5) of the Act,
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1)
The Exchange proposes new equity trading rules relating to Trading Halts, Short Sales, Limit Up-Limit Down, and Odd Lots and Mixed Lots to reflect the implementation of Pillar, the Exchange's new trading technology platform. The text of the proposed rule change is available on the Exchange's Web site at
In its filing with the Commission, the self-regulatory organization included statements concerning the purpose of, and basis for, the proposed rule change and discussed any comments it received on the proposed rule change. The text of those statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant parts of such statements.
On April 30, 2015, the Exchange filed its first rule filing relating to the implementation of Pillar, which is an integrated trading technology platform designed to use a single specification for connecting to the equities and options markets operated by NYSE Arca and its affiliates, New York Stock Exchange LLC (“NYSE”) and NYSE MKT LLC (“NYSE MKT”).
This filing is the third set of proposed rule changes to support Pillar implementation and is intended to be read together with the Pillar I Filing and Pillar II Filing. As described in the Pillar I Filing, new rules to govern trading on Pillar would have the same numbering as current rules, but with the modifier “P” appended to the rule number. For example, Rule 7.18, governing UTP Regulatory Halts, would remain unchanged and continue to apply to any trading in symbols on the current trading platform. Proposed Rule 7.18P would govern Trading Halts for trading in symbols migrated to the Pillar platform. In addition, the proposed new rules to support Pillar in this filing would use the terms and definitions that were proposed in the Pillar I Filing and Pillar II Filing.
In this filing, the Exchange proposes new Pillar rules relating to:
• Definition of “Official Closing Price” (NYSE Arca Equities Rule 1.1 (“Rule 1.1”));
• Clearly Erroneous Executions (NYSE Arca Equities Rule 7.10P (“Rule 7.10P”));
• Limit Up—Limit Down Plan and Trading Pauses in Individual Securities Due to Extraordinary Market Volatility (NYSE Arca Equities Rule 7.11P (“Rule 7.11P”));
• Short Sales (NYSE Arca Equities Rule 7.16P (“Rule 7.16P”));
• Trading Halts (NYSE Arca Equities Rule 7.18P (“Rule 7.18P”)); and
• Odd and Mixed Lots (NYSE Arca Equities Rule 7.38P (“Rule 7.38P”)).
The Exchange also proposes to amend existing definitions in Rule 1.1.
Rule 1.1 sets forth definitions, and in the Pillar I Filing, the Exchange proposes to amend existing definitions and to add new definitions that would be applicable in Pillar only.
• Amend Rule 1.1 to delete the definitions for “UTP Plan” and “OTC/UTC Participant,” and amend definitions of “UTP Listing Market” and “UTP Regulatory Halt,” which would be applicable both for the current trading platform and for Pillar;
• Add a new definition for the term “UTP Security,” which would be applicable both for the current trading platform and for Pillar; and Add a new definition for the term “Official Closing Price,” which would be for Pillar only.
Current Rule 1.1(ii) defines the term “UTP Plan” to mean the Nasdaq Unlisted Trading Privileges Plan, as from time to time amended according to its provisions. Because the term “UTP Plan” is no longer used in Exchange rules, the Exchange proposes to delete this definition.
Current Rule 1.1(jj) defines the term “UTP Listing Market” for a Nasdaq Security as having the same meaning assigned to it in the Nasdaq Unlisted Trading Privileges Plan, as amended, or for any other security shall mean the primary listing market for the security other than the Exchange. The Exchange proposes to streamline this definition and make non-substantive amendments to eliminate the references to Nasdaq Securities, which is no longer a defined term on the Exchange,
Current Rule 1.1(kk) defines the term “UTP Regulatory Halt” to mean a trade suspension or halt called by the UTP Listing Market for the purpose of dissemination of material news. The Exchange proposes non-substantive amendments to this definition to refer to any circumstance when the Exchange would be required to halt trading in a UTP Security. As proposed, a “UTP
The Exchange proposes to adopt a new definition in Pillar to define the term “Official Closing Price,” which would be set forth in proposed Rule 1.1(ggP). As proposed, the term “Official Closing Price” would mean the reference price to determine the closing price in a security for purposes of Rule 7 Equities Trading. In Pillar rules, the term “Official Closing Price” would be used in proposed Rule 7.16P (for Exchange-listed securities only) and for Market Order Trading Collars pursuant to proposed Rule 7.31P(a)(1)(B) (for both Exchange-listed and UTP Securities).
Proposed Rule 1.1(ggP)(1) would describe how the Official Closing Price would be determined for securities listed on the Exchange. As proposed, the Official Closing Price would be the price established in a Closing Auction of one round lot or more on a trading day. Because there may be circumstances when there is insufficient trading interest to have a closing auction trade of one round lot or more, the Exchange proposes to specify what price the Exchange would use as its Official Closing Price when there is no auction or a closing trade of less than a round lot. As proposed, if there is no Closing Auction or if a Closing Auction trade is less than a round lot on a trading day, the Official Closing Price would be the most recent consolidated last sale eligible trade during Core Trading Hours on that trading day. The rule would further provide that if there were no consolidated last sale eligible trades during Core Trading Hours on that trading day, the Official Price would be the prior trading day's Official Closing Price.
The Exchange believes that in the absence of a Closing Auction of a round lot or more, the last consolidated last sale eligible trade during Core Trading Hours best approximates the market's determination of the price of such securities. The Exchange proposes to use only those trades that occur during Core Trading Hours because the lower liquidity during the Early and Late Trading Sessions may mean that trades occurring during those sessions may not be as representative of the price of the security. The Exchange also proposes to use only last sale eligible trades to ensure that the referenced trade is a round lot or more, and therefore indicative of the security's price and not an anomalous trade.
For example, assume on Monday, there is no closing auction in symbol ABC, an Exchange-listed security and the most recent consolidated last sale eligible trade was at 3:00 p.m. Eastern Time that day for $10.00. Because there was no Closing Auction, the Official Closing Price on Monday would be $10.00. Assume on Tuesday, there is no Closing Auction or consolidated last sale eligible trades in ABC during Core Trading Hours. Accordingly, the Exchange would use the prior day's Official Closing Price, which was $10.00, so Tuesday's Official Closing Price would also be $10.00. Assume on Wednesday there is again no Closing Auction or consolidated last sale eligible trades during Core Trading Hours. The Wednesday Official Closing Price would be based on Tuesday's Official Closing Price, which was $10.00. This evaluation would continue on each trading day.
Proposed Rule 1.1(ggP)(2) would describe how the Exchange would determine the Official Closing Price for securities listed on an exchange other than the Exchange. The Official Closing Price would be relevant for purposes of the value that the Exchange would use to begin calculating Market Order Trading Collars pursuant to proposed Rule 7.31P(a)(1)(B). As proposed, the Official Closing Price would be the official closing price disseminated by the primary listing market for that security via a public data feed on a trading day.
The Exchange also proposes that an Official Closing Price may be adjusted to reflect corporate actions or a correction to a closing price, as disseminated by the primary listing market for the security. The proposed rule would provide specificity in Pillar rules regarding what the Exchange would consider an Official Closing Price for securities that do not have a Closing Auction or for which the primary listing market does not disseminate an official closing price.
The Exchange proposes new Rule 7.18P to describe halts on the Pillar trading platform, and more specifically, how orders would be processed during halts, suspensions, or pauses in any security as well as halts related to Derivative Securities Products.
Current Rule 7.18 sets forth requirements relating to UTP Regulatory Halts. Current Rule 7.11(b)(6) sets forth how the Exchange processes new and existing orders during a trading pause issued by another primary listing market. Current Rule 7.34(a)(4) sets forth requirements for trading halts in Derivative Securities Products traded pursuant to UTP on the NYSE Arca Marketplace and current Rule 7.34(a)(5) sets forth requirements for trading halts in Derivative Securities Products listed on the Exchange.
• Current Rule 7.34(a)(4)(A) provides that if a security described in NYSE Arca Equities Rules 5.1(b)(13), 5.1(b)(18), 5.2(j)(3), 8.100, 8.200, 8.201, 8.202, 8.203, 8.204, 8.300, 8.400, 8.500, 8.600 and 8.700 (for purposes of this Rule 7.34, a “Derivative Securities Product”) begins trading on the NYSE Arca Marketplace in the Opening Session and subsequently a temporary interruption occurs in the calculation or wide dissemination of the Intraday Indicative Value (“IIV”) or the value of the underlying index, as applicable, to such Derivative Securities Product, by a major market data vendor, NYSE Arca
• Current Rule 7.34(a)(4)(B) provides that during the Core Trading Session, if a temporary interruption occurs in the calculation or wide dissemination of the applicable IIV or value of the underlying index by a major market data vendor and the listing market halts trading in the Derivative Securities Product, NYSE Arca, upon notification by the listing market of such halt due to such temporary interruption, also shall immediately halt trading in the Derivative Securities Product on the NYSE Arca Marketplace.
• Current Rule 7.34(a)(4)(C) relates to the Late Trading Session and the next business day's Opening Session, and provides that if the IIV or the value of the underlying index continues not to be calculated or widely available after the close of the Core Trading Session, NYSE Arca may trade the Derivative Securities Product in the Late Trading Session only if the listing market traded such securities until the close of its regular trading session without a halt. The rule further provides that if the IIV or the value of the underlying index continues not to be calculated or widely available as of the commencement of the Opening Session on the next business day, NYSE Arca shall not commence trading of the Derivative Securities Product in the Opening Session that day. If an interruption in the calculation or wide dissemination of the IIV or the value of the underlying index continues, NYSE Arca may resume trading in the Derivative Securities Product only if calculation and wide dissemination of the IIV or the value of the underlying index resumes or trading in the Derivative Securities Product resumes in the listing market.
• Current Rule 7.34(a)(5) sets forth that with respect to Derivative Securities Products listed on the NYSE Arca Marketplace for which a Net Asset Value (“NAV”) (and in the case of Managed Fund Shares under NYSE Arca Equities Rule 8.600 and Managed Trust Securities under NYSE Arca Equities Rule 8.700, a Disclosed Portfolio) is disseminated, if the Exchange becomes aware that the NAV (or in the case of Managed Fund Shares, the Disclosed Portfolio) is not being disseminated to all market participants at the same time, it will halt trading in the affected Derivative Securities Product on the NYSE Arca Marketplace until such time as the NAV (or in the case of Managed Fund Shares, the Disclosed Portfolio, as applicable) is available to all market participants.
As proposed, the first sentence of new Rule 7.18P(a) would provide that if the UTP Listing Market declares a UTP Regulatory Halt, the Corporation
The Exchange proposes a substantive difference in Pillar to add in Rule 7.18P(a) that, during Core Trading Hours, the Exchange would halt trading during a UTP Regulatory Halt until it receives the first Price Band in a UTP Security. As proposed, notwithstanding that the Exchange may have received notification from the primary listing market to reopen a security or have authority under the LULD Plan or Rule 7.12 to reopen trading in a UTP Security, the Exchange proposes that, during Core Trading Hours, the Exchange would wait until after it receives the first Price Band in that security before it begins trading. By waiting until it receives the first Price Band, the Exchange would not begin trading in a UTP Security before the protections of the LULD Plan are available.
The second sentence of proposed Rule 7.18P(a) would be based on the second sentence of current Rule 7.18, without any substantive differences. Because proposed Rule 7.18P would cover halts other than regulatory halts for the purpose of dissemination of material news, the Exchange proposes a non-substantive difference to specify that the second sentence of proposed Rule 7.18P would be applicable only for halts based on dissemination of material news. Accordingly, the second sentence of proposed Rule 7.18P(a) would provide that if a UTP Regulatory Halt were issued for the purpose of dissemination of material news, the Corporation would assume that adequate publication or dissemination has occurred upon the expiration of one hour after initial publication in a national news dissemination service of the information that gave rise to an UTP Regulatory Halt and may, at its discretion, reopen trading at that time, notwithstanding notification from the UTP Listing Market that the halt or suspension is no longer in effect.
Proposed Rule 7.18P(b) would further provide how the Exchange would process new and existing orders in a UTP Security during a UTP Regulatory Halt, and is based on rule text from current Rule 7.11(b)(6) regarding how the Exchange processes new and existing orders in UTP Securities during a trading pause triggered under the LULD Plan:
• Proposed Rule 7.18P(b)(1) would provide that the Exchange would cancel any unexecuted portion of Market Orders, which is based on rule text in current Rule 7.11(b)(6)(ii). The Exchange proposes a substantive difference in Pillar from current Rule 7.11(b)(6)(ii) because Pegged Orders would not be cancelled during a UTP Regulatory Halt. Rather, such orders would remain on the NYSE Arca Book and once the Exchange resumes trading the UTP Security, Pegged Orders would be assigned working prices based on the new PBBO and be eligible to trade.
• Proposed Rule 7.18P(b)(2) would provide that the Exchange would maintain all other resting orders in the NYSE Arca Book, which other than Pegged Orders, is how the Exchange currently functions and is based on rule text in current Rule 7.11(b)(6)(i).
• Proposed Rule 7.18P(b)(3) would provide that the Exchange would accept and process all cancellations, which is based on current Rule 7.11(b)(6)(iii).
• Proposed Rule 7.18P(b)(4) would be new functionality for Pillar, and would provide that the Exchange would process a request to cancel and replace as a cancellation without replacing the order. Accordingly, if a User seeks to replace an order, the Exchange would reject that request because it would be a new order, consistent with proposed Rule 7.18P(6), described below, but the Exchange would also cancel the resting order because that would meet the intent of the User to replace an order by cancelling the resting order.
• Proposed Rule Rule 7.18P(b)(5) would provide that the Exchange would accept and route new Market Orders, Auction-Only Orders, Primary MOO/LOO Orders, Primary Only Day Orders, and Primary Only MOC/LOC Order to the primary listing market.
The proposed handling of Market Orders and Primary Only Orders in Pillar is based on current Rule 7.11(b)(6)(iv) and (v), which provides that the Exchange accepts and routes new Market Orders, PO Orders, and PO+ Orders to the primary market. The Exchange proposes non-substantive differences to use the term “primary listing market” instead of “primary market” and to refer to the specific Primary Only Orders, as defined in the Pillar II Filing, that would be eligible to be routed.
The proposed treatment of Auction-Only Orders during a UTP Regulatory Halt in new Rule 7.18P(b)(5) would be new in Pillar. The proposed processing of Auction-Only Orders during a UTP Regulatory Halt would be consistent with the proposed treatment of such orders in Pillar. As set forth in the Pillar I Filing, the Exchange proposes that before the Core Trading Session begins (and for Market Orders, until the first primary listing market print of any size or 10 a.m. Eastern Time, whichever is earlier), it would route Market Orders and Auction-Only Orders for securities that are not eligible for an auction on the Exchange to the primary listing market, even if such orders do not include a Primary Only designation.
• Proposed Rule 7.18P(b)(6) would provide that the Exchange would reject all other incoming orders until the security begins trading on the NYSE Arca Marketplace pursuant to proposed Rule 7.18P(a). This proposed rule text is based on current Rule 7.11(b)(6)(vi), which provides that the Exchange rejects all other orders until the stock has reopened, with a proposed substantive difference to reflect that the time when a stock would be reopened would be based on proposed Rule 7.18P(a), described above.
• Proposed Rule 7.18P(c)(1) would provide that the Exchange would cancel any unexecuted portion of Market Orders, which is how the Exchange currently functions. The Exchange proposes a substantive difference in Pillar from current functionality because Pegged Orders would not be cancelled.
• Proposed Rule 7.18P(c)(2) would provide that the Exchange would maintain all other resting orders in the NYSE Arca Book, which other than Pegged Orders, is how the Exchange currently functions. The Exchange proposes to further provide in Pillar that, during a halt, suspension, or pause in Exchange-listed securities, the Exchange would assign Limit Orders on the NYSE Arca Book a working price and display price that is equal to the limit price of the such orders. For example, if an Arca Only Order or ALO Order in an Exchange-listed security has a working price different from its limit price, during a trading halt, suspension, or pause, such order would be re-priced to its limit price. The Exchange proposes to re-price such orders to their limit price so that they may participate in the Trading Halt Auction at their limit price.
Consistent with the proposed processing of Pegged Orders, in Pillar, Primary Pegged Orders would remain on the NYSE Arca Book and be eligible to participate in the Trading Halt Auction at their limit price. Market Pegged Orders would remain undisplayed on the NYSE Arca Book, would not be eligible to participate in the Trading Halt Auction, but would be available to be assigned a new working price and be eligible to trade once there is a PBBO against which to peg following the Trading Halt Auction.
• Proposed Rule 7.18P(c)(3) would provide that the Exchange would accept and process all cancellations, which is based on current functionality.
• Proposed Rule 7.18P(c)(4) would provide that the Exchange would reject incoming Limit Orders designated IOC, Cross Orders, Tracking Orders, Market Pegged Orders, and Retail Orders. In addition, because the Exchange would not accept new Tracking Orders, Market Pegged Orders, or Retail Orders in Exchange-listed securities during a halt, suspension, or pause, the Exchange would process a request to cancel and replace a Tracking Order, Market Pegged Order, or Retail Order as a cancellation without replacing the order.
• Proposed Rule 7.18P(c)(5) would provide that the Exchange would accept all other incoming orders until the security has reopened, which represents current functionality.
• To use the terms “Derivative Securities Product” and “UTP Derivative Securities Product,” which are new defined terms the Exchange has proposed to be set forth in Rule 1.1(bbb).
• To use the terms “Early Trading Session” instead of “Opening Session” and “primary listing market” instead of “listing market.”
Rule 7.16 sets forth requirements relating to short sales. The Exchange proposes to adopt new Rule 7.16P to address short sales in Pillar. As proposed, new Rule 7.16P would be based on the same rule numbering as current Rule 7.16, but with proposed substantive differences to the rule text that correlates to current Rule 7.16(f). Specifically, in Pillar, because of proposed substantive differences to how certain orders and modifiers would operate, the Exchange proposes different handling of certain orders in Pillar to comply with the requirements of Rule 201 of Regulation SHO (“Rule 201”).
Proposed Rules 7.16P(f)(1)-(4) would be based on the rule text in current Rules 7.16(f)(i) (Definitions), 7.17(f)(ii) (Short Sale Price Test), 7.16(f)(iii) (Determination of Trigger Price), and Rule 7.16(f)(iv) (Duration of Short Sale Price Test), with minor non-substantive differences to replace the term “shall” with “will,” add the short-hand definition of “NBB,” replace references to “national best bid” with references to “NBB,” and update cross-references based on the proposed different sub-numbering for paragraph (f) of proposed Rule 7.16P.
The Exchange proposes substantive differences in Rules 7.16P(f)(2) and (f)(3) from current Rules 7.16(f)(ii) and (f)(iii) regarding which price the Exchange would use in Pillar to determine a Trigger Price. Current Rule 7.16(f)(ii) provides that except as provided in subparagraphs (vi) and (vii) of Rule 7.16(f), Corporation systems shall not execute or display a short sale order with respect to a covered security at a price that is less than or equal to the current national best bid if the price of that security decreases by 10% or more, as determined by the listing market for the security, from the security's closing price on the listing market as of the end of regular trading hours on the prior day (“Trigger Price”). Rule 7.16(f)(iii)(B) further provides that if a covered security did not trade on the Corporation on the prior trading day (due to a trading halt, trading suspension, or otherwise), the Corporation's determination of the Trigger Price will be based on the last sale price on the Corporation for that security on the most recent day on which the security traded.
As discussed above, the Exchange proposes to adopt a new definition in Pillar for the term “Official Closing Price.” The Exchange proposes to use this term in proposed Rule 7.16P(f)(2) for purposes of determining the Trigger Price in Exchange-listed securities, which would be a substantive difference from current Rule 7.16(f)(ii), which uses the security's closing price on the listing market. By using the proposed definition of “Official Closing Price,” if there is no closing auction of a round lot or more, the Exchange would use the most recent consolidated last sale price to determine the Trigger Price, rather than the last price of the security on the Exchange. While this would be a substantive difference for Pillar, the proposal is consistent with NYSE Rule 440B(c)(3), which provides that under specified circumstances, the NYSE may use the consolidated last sale price for a security on the most recent day on which the security traded for purposes of determining a Trigger Price. Similar to the NYSE, the Exchange believes that in the absence of a closing auction of a round lot or more, using the consolidated last sale price available as of the end of Core Trading Hours on the prior day (or most recent day when there is a consolidated last sale price) best approximates the market's determination of the appropriate price of such securities.
Using the term “Official Closing Price” in proposed Rule 7.16(f)(2), which would incorporate scenarios when there is no closing auction on the Exchange, would obviate the need to include text from current Rule 7.16(f)(iii)(B) in proposed Rule 7.16P. Specifically, the proposed definition of “Official Closing Price,” which defines how the Exchange would determine an Official Closing Price in the absence of a Closing Auction or consolidated last sale eligible trade on the prior trading day, would cover the scenario described in current Rule 7.16(f)(iii)(B),
The Exchange's proposed modification in Pillar to how it would determine the Trigger Price is consistent with Rule 201.
• Proposed Rule 7.16P(f)(5)(A) would set forth how the Exchange would re-price orders in Pillar and is based on current Rule 7.16(f)(v)(C), which provides that marketable short sale orders will be re-priced by the Corporation one minimum price increment above the current national best bid (the “Permitted Price”) and defines the Permitted Price for securities priced $1.00 or more or under a $1.00.
The first sentence of proposed Rule 7.16P(f)(5)(A) would be based on the first sentence of Rule 7.16(f)(v)(C) with non-substantive differences to define the orders that would be re-priced as “short sale orders with a working price
The Exchange proposes to use Pillar terminology to refer to the price at which an order is eligible to trade (working price) or be displayed (display price)
The second and third sentences of proposed Rule 7.16P(f)(5)(A) would be based on the second and third sentences of current Rule 7.16(f)(v)(C) with minor non-substantive differences to use the term “NBB” instead of “national best bid” and use the term “adjust” instead of “reprice.”
• Proposed Rule 7.16P(f)(5)(B) would set forth the reject option for sell short orders that would be required to be re-priced during a Short Sale Price Test. The proposed rule is based on current Rule 7.16(f)(v)(A), which provides that an ETP Holder may mark individual short sale orders to be rejected back if entered while a symbol is subject to the short sale price test.
In Pillar, the Exchange is proposing a substantive difference to provide that the reject instruction would apply not only to orders on arrival, but also to resting orders. As proposed, if the ETP Holder chooses the reject option, a resting order that would be required to be adjusted to a Permitted Price while a symbol is subject to the Short Sale Price Test would instead cancel. Allowing ETP Holders to elect that their resting interest be cancelled if it would be required to re-price is consistent with the intent of the current rule, which is to reject an order rather than re-price. In addition, the Exchange proposes a minor non-substantive difference to use the term “adjust” rather than “re-price.”
• Proposed Rule 7.16P(f)(5)(C) would provide how the Exchange would process sell short Priority 1, Priority 2 odd lot orders, and Priority 3 orders during a Short Sale Price Test. This proposed rule text is based on current Rule 7.16(f)(v)(D)(i) relating to short sale orders that are not displayed on entry, which provides that Market Orders and Passive Liquidity orders will be re-priced at a Permitted Price and will continuously re-price at a Permitted Price as the national best bid moves both up and down.
The Exchange proposes to use Pillar terminology to refer to Priority categories to ensure that all sell short orders that would be subject to re-pricing both up and down during a Short Sale Period would be subject to the rule. As proposed, Market Orders, orders and reserve interest ranked Priority 3—Non-Display Orders, and odd lot orders ranked Priority 2—Display Orders would have a working price adjusted to a Permitted Price and would continuously adjust to a Permitted Price as the NBB moves both up and down. The rule would further provide that reserve interest that replenishes the displayed quantity of a Reserve Order would be replenished at a Permitted Price. The Exchange proposes non-substantive differences to use the term “adjust” instead of “reprice,” and “NBB” instead of “national best bid.”
In Pillar, the Exchange is proposing a substantive difference to treat odd lot orders ranked Priority 2—Display Orders in the same manner as Market Orders and other non-displayed orders. As discussed in the Pillar I Filing, the Exchange proposes that odd lot orders that are ranked Priority 2—Display Orders would be considered “displayed” for purposes of ranking because such orders are available via the Exchange's proprietary data feeds.
The last sentence of proposed Rule 7.16P(f)(5)(C) would provide that reserve interest that replenishes the displayed quantity of a Reserve Order would be replenished at a Permitted Price. This represents current functionality regarding reserve interest pursuant to current Rule 7.16(f)(v)(C) in that all marketable orders other than those specified in the rule are re-priced to one MPV above the current NBB, which includes reserve interest that replenishes the display quantity of a Reserve Order. The Exchange proposes to specify this requirement separately in proposed Rule 7.16P(f)(5)(C) in order to promote clarity regarding at what price reserve interest would replenish any depleted display quantity of a Reserve Order. Because the reserve interest would already be re-priced to a Permitted Price, the Exchange would replenish display quantity at the Permitted Price, even if the previously displayed quantity were eligible to be displayed at the NBB pursuant to proposed Rule 7.16P(f)(6).
• Proposed Rule 7.16P(f)(5)(D) would set forth how the Exchange would process sell short Pegged Orders and MPL Orders during a Short Sale Price Test. The proposed rule is based on current Rule 7.16(f)(v)(B), which provides that MPL Orders will continue to be priced at the mid-point of the national best bid and national best offer, including situations where the midpoint is not one minimum price increment above the national best bid. The Exchange proposes to add Pegged Orders to this paragraph to describe new functionality in Pillar that the Exchange would not reject or cancel Pegged Orders during a Short Sale Period.
As proposed, during a Short Sale Period, both Pegged Orders and MPL
For Primary Pegged Orders, being pegged to the NBBO during a Short Sale Price Test would eliminate the possibility for a sell short Primary Pegged Order to be displayed at the NBB unless it was previously displayed at a price above the then NBB, consistent with proposed Rule 7.16P(f)(6), discussed below. As described in the Pillar II Filing, pursuant to proposed Rule 7.31P(h)(2)(A), if the PBBO becomes locked or crossed, a resting Primary Pegged Order would wait for the PBBO that is not locked or crossed before the working price would be adjusted, but would remain eligible to trade at its then displayed price.
For Market Pegged Orders, because such orders are ranked Priority 3—Non-Display Orders, a sell short Market Pegged Order that is pegged to the NBBO during a Short Sale Price Test would be adjusted to a Permitted Price pursuant to proposed Rule 7.16P(f)(5)(C). For example, assume a sell short Market Pegged Order is pegged to the PBB, with no offset. If a Short Sale Price Test is triggered in that security, the Market Pegged Order would begin pegging to the NBB and its working price would be adjusted to a Permitted Price. Accordingly, the Market Pegged Order, which would be undisplayed, would never be permitted to trade at the NBB.
• Proposed Rule 7.16P(f)(5)(E) would set forth how the Exchange would process sell short Tracking Orders during a Short Sale Price Test, which would be new in Pillar.
• Proposed Rule 7.16P(f)(5)(F) would set forth how the Exchange would process sell short IOC Orders during a Short Sale Price Test. The proposed rule is based on current Rule 7.16(f)(v)(E), which provides that IOC orders requiring that all or part of the order be executed immediately will be executed to the extent possible at a Permitted Price and higher and then cancelled, and will not be re-priced. The Exchange proposes non-substantive differences in proposed Rule 7.16P(f)(5)(F) to use the term “traded” instead of “executed” and use proposed Pillar terminology to state that the working price would not be adjusted instead of saying “will not be re-priced.”
• Proposed Rule 7.16P(f)(5)(G) would set forth how the Exchange would process sell short Day ISOs during a Short Sale Price Test. The proposed rule is based on current Rule 7.16(f)(v)(F), which provides that PNP ISO Orders are rejected if the price is at or below the current national best bid. The Exchange proposes non-substantive differences in proposed Rule 7.16(P)(5)(G) to refer to this order as a “Day ISO” instead of a “PNP ISO Order,” reference the “limit price” and not just the “price,” and use the term “NBB” instead of “national best bid.”
• Proposed Rule 7.16P(f)(5)(H) would set forth how the Exchange would process Cross Orders for which the sell side is a short sale order and are received during a Short Sale Price Test. Currently, Cross Orders, which are an IOC Order, are subject to Rule 7.16(f)(v)(E) and if the proposed cross price is not at a Permitted Price or higher, the Cross Order is not re-priced but would instead cancel. Proposed Rule 7.16P(f)(5)(H) would provide that Cross Orders with a cross price at or below the NBB would be rejected. Accordingly, Cross Orders in Pillar would be processed the same as provided for in Rule 7.16(f)(v)(E).
• Proposed Rule 7.16P(f)(5)(I) would provide how the Exchange would process sell short orders for which a Short Sale Price Test is triggered after the order is routed. The proposed rule text represents new functionality for Pillar. As proposed, if a Short Sale Price Test is triggered after an order has routed, any returned quantity of the order and the order it joins on the NYSE Arca Book would be adjusted to a Permitted Price. The Exchange proposes to re-price the resting quantity, even if it were eligible to remain displayed at the NBB price pursuant to proposed Rule 7.16P(f)(6), to conform to the general requirement in Pillar that the returned quantity of a partially routed order would join the resting quantity.
Proposed Rule 7.16P(f)(5)(I) would further provide that if the order that was routed was a Reserve Order, the returned quantity of the order would first join the reserve interest at a Permitted Price and be assigned a new working time before being evaluated for replenishing the display quantity of the Reserve Order. This proposed functionality would ensure that the
• Proposed Rule 7.16P(f)(5)(J) would provide how orders with a Proactive if Locked/Crossed Modifier would operate during a Short Sale Period and is based on current Rule 7.16(f)(v)(G), which provides that proactive if locked modifiers will be ignored for short sale orders. The Exchange proposes a non-substantive difference to rename the modifier as a “Proactive if Locked/Crossed Modifier,” consistent with the proposed name of the modifier in Pillar.
Proposed Rule 7.16P(f)(6) would provide for the execution of permissible orders during the Short Sale Period. The proposed rule text is based on current Rule 7.16(f)(vi), which provides that during the Short Sale Period, Corporation systems will execute and display a short sale order without regard to price if, at the time of initial display of the short sale order, the order was at a price above the then current national best bid. Except as specifically noted in subparagraph (v), short sale orders that are entered into the Corporation prior to the Short Sale Period but are not displayed will be re-priced to a Permitted Price. The Exchange proposes minor non-substantive differences to replace the reference to “national best bid” with a reference to “NBB,” update the cross reference from subparagraph (f)(v) to subparagraph (f)(5), and replace the term “re-priced” with the term “adjusted.”
Proposed Rule 7.16P(f)(7) would provide for short exempt orders. The proposed rule text is based on current Rule 7.16(f)(vii) with no differences.
Rule 7.11 sets forth rule provisions relating to the LULD Plan and trading pauses in individual securities due to extraordinary market activity. The Exchange proposes new Rule 7.11P for Pillar to address the same topic. As proposed, new Rule 7.11P would be based on the same rule numbering as current Rule 7.11, but with proposed substantive differences to the paragraph that correlates to current Rule 7.11(a)(6). Specifically, in Pillar, the Exchange would expand the number of order types that would be eligible for optional re-pricing instructions.
The Exchange proposes to maintain the current default to cancel orders that would be priced or traded through the Price Bands. Proposed Rule 7.11P(a)(5) would therefore provide that Exchange systems would cancel buy (sell) interest that is priced or could be traded above (below) the Upper (Lower) Price Band, except as specified in proposed Rule 7.11P(a)(6). This proposed rule text is based on current Rule 7.11(a)(5) with non-substantive difference to change the term “shall” to “will” and “executed” to “traded.”
Proposed Rule 7.11P(a)(5)(A) would further provide that incoming marketable interest, including Market Orders, Limit Orders, and Limit Orders designated IOC would be traded, or if applicable, routed to an Away Market, to the fullest extent possible, subject to Rules 7.31P(a)(1)(B) (Trading Collars for Market Orders) and 7.31P(a)(2)(B) (price check for Limit Orders), at prices at or within the Price Bands. Any unexecuted quantity of such incoming marketable interest that cannot be traded at prices at or within the Price Bands would be cancelled and the ETP Holder would be notified of the reason for the cancellation. This proposed rule text is based on current Rule 7.11(a)(5)(A) with non-substantive differences to capitalize “Away Market,” “Market Order,” “Limit Order,” and “Limit Orders designated IOC,” use the term “will” instead of “shall,” use the term “traded” instead of “executed,” and update cross references to proposed Rule 7.31P.
The Exchange also proposes to add proposed Rule 7.11P(a)(5)(B), which would provide that Cross Orders with a cross price above the Upper Price Band or below the Lower Price Band would be rejected. This would be new rule text in Pillar. Cross Orders, which are IOC, are currently subject to current Rule 7.11(a)(5), which provides that IOC Orders execute to the fullest extent possible at prices at or within the Price Bands, and any unexecuted portion that cannot be executed at prices at or within the Price Bands shall be cancelled. Accordingly, if the cross price of a Cross Order cannot be executed at prices at or within the Price Bands, the Cross Order will be cancelled. Proposed Rule 7.11P(a)(5)(B) is based on this rule text, but would also address how the Exchange would process in Pillar the proposed new Limit IOC Routable Cross Orders, which are eligible to trade at prices other than their cross price.
• Current Rule 7.11(a)(6)(A) further provides that instructions to re-price eligible orders shall be applicable to both incoming and resting orders and if the Price Bands move and the original limit price of a re-priced order if at or within the Price Bands, Exchange
• Current Rule 7.11(a)(6)(B) provides that each time an eligible order is re-priced, it shall receive a new time priority.
• Current Rule 7.11(a)(6)(C) sets forth the order types eligible for re-pricing instructions, which are Adding Liquidity Only Orders, Discretionary Orders, Inside Limit Orders, Limit Orders, PNP ISO, PNP Orders, Proactive if Locked Reserve Orders, Reserve Orders, Primary Until 9:45 Orders, Primary After 3:55 Orders, and Primary Sweep Orders.
• Finally, current Rule 7.11(a)(6)(D) provides that for an order type eligible for re-pricing instructions under Rule 7.11(a)(6)(C) that is also a short sell order, during a Short Sale Price Test, as set forth in Rule 7.16(f), a short sale order priced below the Lower Price Band shall be re-priced to the higher of the Lower Price Band or the Permitted Price, as defined in Rule 7.16(f)(ii), and that Sell short orders that are not eligible for re-pricing instructions will be treated as any other order pursuant to Rule 7.11(a)(5).
In Pillar, the Exchange proposes substantive differences to expand the number of order types eligible for re-pricing instructions. In addition, rather than specifying which order types would be eligible for re-pricing instructions, the Exchange would enumerate which order types would not be eligible for re-pricing instructions. Accordingly, as proposed, Rule 7.11P(a)(6) would provide that ETP Holders may enter an instruction for the working price of a Limit Order to buy (sell) with a limit price above (below) the Upper (Lower) Price Band to be adjusted to a price that is equal to the Upper (Lower) Price Band rather than cancel the order. The proposed rule text is based on current Rule 7.11(a)(6) with both substantive differences to reference that Limit Orders are eligible for re-pricing instructions and non-substantive differences to use Pillar terminology.
Proposed Rule 7.11P(a)(6)(A) would be new rule text that enumerates which orders would not be eligible for re-pricing instructions in Pillar.
Proposed Rule 7.11P(a)(6)(B) would provide that instructions to re-price eligible Limit Orders would be applicable to both incoming and resting orders and that if the Price Bands move and the original limit price of a re-priced order is at or within the Price Bands, such a Limit Order would be adjusted to its limit price. This proposed rule text is based on current Rule 7.11(a)(6)(A) with non-substantive differences to refer to “Limit Orders” instead of “orders” and to use the term “adjust” rather than “reprice.”
Proposed Rule 7.11P(a)(6)(C) would set forth proposed new functionality in Pillar regarding how MPL Orders would be processed. Currently, MPL Orders are not eligible for re-pricing instructions, and therefore would cancel if they would trade outside the Price Bands. In Pillar, MPL Orders would be eligible for re-pricing instructions. If such instruction were included on an MPL Order, such order would not cancel if the midpoint of the PBBO were outside the Price Bands, but nor would it re-price. Accordingly, as proposed, Rule 7.11P(a)(6)(C) would provide that an MPL Order that has an instruction to re-price would not cancel, but would not be re-priced or eligible to trade if the midpoint of the PBBO is below the Lower Price Band or above the Upper Price Band. The Exchange believes that the proposed functionality would provide more options for ETP Holders entering MPL Orders so that such orders would not be cancelled if they would trade through a Price Band, but also to honor the intent of the order to trade only at the midpoint of the PBBO.
Proposed Rule 7.11P(a)(6)(D) would be based on current Rule 7.11(a)(6)(D) relating to Sell Short Orders with non-substantive differences to update cross references to proposed Rule 7.16P instead of Rule 7.16. In addition, to reflect the proposed substantive difference of which orders would be eligible for re-pricing instructions in Pillar, the Exchange proposes a non-substantive difference to the first sentence of the proposed rule so that it begins with “[i]f an eligible order includes repricing instructions and is also a sell short order,” instead of the current first sentence of Rule 7.11(a)(6)(D), which states, “[f]or an order type eligible for repricing instructions under (6)(C) above that is also a short sell order.”
Finally, the Exchange would not be including in Rule 7.11P(a)(6) rule text currently set forth in Rule 7.11(a)(6)(A) regarding time priority. As discussed in greater detail in the Pillar I Filing, pursuant to proposed Rule 7.36P(f)(2), an order would be assigned a new working time any time the working price of the order changes and orders re-priced pursuant to proposed Rule 7.11P(a)(6) would be subject to this requirement.
Current Rule 7.11(a)(8) provides that the Exchange may declare a Trading Pause for an NMS Stock listed on the Exchange when (i) the National Best Bid (Offer) is below (above) the Lower (Upper) Price Band and the NMS Stock is not in a Limit State; and (ii) trading in that NMS Stock deviates from normal trading characteristics. Proposed Rule 7.11P(a)(8) would be based on current Rule 7.11(a)(8) without any differences.
Current Rule 7.11(b)(6) provides for how the Exchange processes new and existing orders during a trading pause issued by another primary listing market. As described above, proposed Rule 7.18P(b) would set forth in Pillar how the Exchange would process new and existing orders during a UTP Regulatory Halt, which would include a trading pause issued by another primary listing market. Accordingly, the Exchange would not include rule text from current Rule 7.11(b)(6) in the proposed Rule 7.11P(b).
Rule 7.38 sets forth requirements relating to odd lots and mixed lots, which are terms defined in Rule 7.6. The Exchange proposes new Rule 7.38P to address odd lots and mixed lots in Pillar, including circumstances when odd lot orders would be treated differently than round lot orders.
Proposed Rule 7.38P(a) would provide that Rules 7.31P and 7.44P would specify whether an order may be entered as an odd lot or mixed lot. Unlike current Rule 7.38, the Exchange proposes that in Pillar, whether an order would be eligible to be entered as an odd lot or mixed lot would be covered in proposed Rules 7.31P and 7.44P.
Proposed Rule 7.38P(b) would provide that round lot, mixed lot, and odd lots would be treated in the same manner in the NYSE Arca Marketplace. This rule text is based on current Rule 7.38(b), without any differences.
The Exchange proposes that the general rule in Rule 7.38P(b) would be subject to specific requirements in certain cases, as set forth in proposed Rules 7.38P(b)(1) and (b)(2).
• Proposed Rule 7.38P(b)(1) would provide that the working price of an odd lot order would be adjusted both on arrival and when resting on the NYSE Arca Book based on the limit price of the order. If the limit price of such odd lot order to buy (sell) is at or below (above) the PBO (PBB), it would have a working price equal to the limit price. If the limit price of such odd lot order to buy (sell) is above (below) the PBO (PBB), it would have a working price equal to the PBO (PBB). The proposed rule text uses Pillar terminology to describe how the Exchange would price odd-lot orders that are not displayed as part of the BBO so that they would not trade through the PBBO.
• Proposed Rule 7.38P(b)(2) would set forth the working time that would be assigned to the returned quantity of an order that create [sic] a new BBO when it joins resting quantity of the order. As proposed, the rule would provide that for an order that is partially routed to an Away Market on arrival, if any returned quantity of the order joins resting odd-lot quantity of the original order and the returned and resting quantity, either alone or together with other odd-lot orders, would be displayed as a new BBO, both the returned and resting quantity would be assigned a new working time.
As set forth in the Pillar I Filing, proposed Rule 7.36P(f)(1)(B) would provide that for an order that is partially routed to an Away Market on arrival, the portion that is not routed would be assigned a working time.
Proposed Rule 7.38P(b)(2) would provide for an exception to this general requirement and is intended to prevent the Exchange from displaying a new BBO that would lock or cross an Away Market PBBO. Without this exception, if the returned quantity joined the resting quantity's working time and is then displayed as a new BBO, it would be considered to have an earlier working time than an updated PBBO, even though the new BBO may be displayed after the PBBO was updated. By assigning a new working time to the new displayed BBO, the Exchange would evaluate it for routing as if it were a newly arriving order.
For example, assume the PBBO is 9.98 x 10.00 and the 10.00 PBO is on an Away Market for 100 shares. The Exchange receives a Limit Order to buy “A” for 120 shares priced at 10.00 and would route 100 shares of A to the Away Market, and 20 shares would be entered on the NYSE Arca Book and assigned a working time. Because 20 shares is an odd lot quantity, the Exchange could enter it onto the NYSE Arca Book without locking the PBO. Assume that the returned quantity of A is 80 shares, and between the time the order was routed and it returns unexecuted, a second Away Market displays an offer of 10.00, which is the new PBO. The returned quantity of A together with the resting quantity of A would equal 100 shares, and therefore would constitute the best ranked non-marketable displayed Limit Order on the Exchange and would become the BB. As proposed, the entire quantity of A would be assigned a new working time, which would be the time the returned quantity returns to the Exchange. The Exchange would then evaluate whether the order should be routed, and in this case, because it would create a new BB that would lock
The Exchange proposes to adopt new Rule 7.10P for Pillar in order to reflect terminology changes proposed in the Pillar I Filing and to replace obsolete terms. As proposed, new Rule 7.10P would have the same rule text and paragraph numbering as Rule 7.10 and would not have any substantive differences from Rule 7.10. The Exchange proposes the following non-substantive differences for proposed Rule 7.10P.
• To replace the term “shall” with “will” throughout the rule and replace the term “shall mean” in proposed Rule 7.10P(i) with “means.”
• To use the terms “Early Trading Session” instead of “Opening Session” and “Late Trading Session” instead of “Late Session” in proposed Rules 7.10P(c)(1) and 7.10P(c)(3), which would reflect the new terms proposed in the Pillar I Filing in proposed Rule 7.34P and are based on current Rule 7.10(c)(1) and 7.10(c)(3).
• To replace the term “ie.” with the term “
• To capitalize the term “Cross Order” and delete an obsolete reference to the Portfolio Crossing Service
• To replace the term “NYSE Arca Equities” with “Exchange” as the modifier for Chief Regulatory Officer in proposed Rule 7.10P(e)(3), which is based on current Rule 7.10(e)(3). The Chief Regulatory Officer is an officer of NYSE Arca, which is the Exchange, and not its wholly-owned subsidiary NYSE Arca Equities. Therefore, changing the term to “Exchange” more accurately reflects the entity for which the Chief Regulatory Officer is an officer.
• To replace the term “3:00 ET” with the term “3:00 p.m. Eastern Time” in proposed Rule 7.10P(e)(3), which is based on current Rule 7.10(e)(3) and is consistent with the proposed manner to describe time in the Pillar I Filing.
• To replace the term “Member” with “ETP Holder” in proposed Rule 7.10P(i), which is based on current Rule 7.10(i).
The Exchange also proposes non-substantive differences to update cross references in the Rule from Rule 7.10 to Rule 7.10P.
As discussed in the Pillar I Filing, because of the technology changes associated with the migration to the Pillar trading platform, the Exchange will announce by Trader Update when rules with a “P” modifier will become operative and for which symbols. The Exchange believes that keeping existing rules pending the full migration of Pillar is necessary because they would continue to govern trading on the current trading platform pending the full migration.
The proposed rule change is consistent with Section 6(b) of the Securities Exchange Act of 1934 (the “Act”),
The Exchange believes that the proposed amendments to existing definitions in Rule 1.1 would remove impediments to and perfect the mechanism of a fair and orderly market because they would not make any substantive changes to Exchange rules, but rather are designed to reduce confusion by eliminating obsolete references and terms and therefore streamline the Exchange's rules. The Exchange further believes that the proposed new definition for the term “Official Closing Price” would remove impediments to and perfect the mechanism of a fair and orderly market because the proposed definition would promote transparency regarding the reference price the Exchange would use in Pillar for purposes of calculating Trading Collars, pursuant to proposed Rule 7.31P(a)(1)(B), and for purposes of determining a Trigger Price pursuant to proposed Rule 7.16P(f)(2).
For determining the Official Closing Price, the Exchange believes that in the absence of a Closing Auction of a round lot or more, the most recent consolidated last sale eligible trade during Core Trading Hours best approximates the market's determination of the appropriate price of such securities. In addition, using only those trades that occur during Core Trading Hours that are last sale eligible would remove impediments to and perfect the mechanism of a fair and orderly market because the lower liquidity during the Early and Late Trading Sessions may mean that trades occurring during those sessions may not be as representative of the price of the security and odd-lot trades may indicate an anomalous trade.
The Exchange believes that proposed Rule 7.18P would remove impediments to and perfect the mechanism of a fair and orderly market because it would set forth in a single rule the requirements for trading halts on the Exchange in both UTP Securities and Exchange-listed securities, which are currently set forth in Rules 7.11(b)(6), 7.18, and 7.34(a)(4) and (a)(5). The Exchange
• Waiting until receipt of a Price Band in a UTP Security before resuming trading following a UTP Regulatory Halt would assure that the Exchange would not begin trading in a UTP Security before the protections of the LULD Plan would be available. In addition, not holding a Trading Halt Auction on the Exchange in a UTP Security, together with rejecting new orders and routing Primary Only Orders received during a UTP Regulatory Halt to the primary listing market, would protect investors and the public by promoting price discovery and liquidity on the primary listing market for its re-opening auction.
• Processing new and existing orders for UTP Securities differently from new and existing orders in Exchange-listed securities during a halt, suspension, or trading pause would complement the proposal not to conduct a Trading Halt Auction in a UTP Security, as discussed above. For Exchange-listed securities, because the Exchange would be conducting a Trading Halt Auction, the Exchange would accept new orders that would be eligible to participate in such auction. In addition, to facilitate such auction, the Exchange would not cancel resting Pegged Orders and would adjust the working price of resting Limit Orders (including Pegged Orders) to their limit price so that such orders could participate in a Trading Halt Auction at their limit prices. The Exchange believes such proposed processing of new and existing orders would promote liquidity and price discovery for Trading Halt Auctions in Exchange-listed securities.
With respect to Short Sales, the Exchange believes that proposed Rule 7.16P would remove impediments to and perfect the mechanism of a fair and orderly market because it would use Pillar terminology to describe how the Exchange would process sell short orders during a Short Sale Period, consistent with Rule 201 of Regulation SHO. More specifically, the Exchange believes that using the new term “Official Closing Price” for determining the Trigger Price of a security in Rule 7.16P(f)(2) is consistent with Rule 201(b)(1)(i) of Regulation SHO, which requires that the listing market determine the closing price of a covered security, but does not require that the Exchange use the closing auction on the Exchange to determine that closing price. The Exchange believes that using the Official Closing Price would provide for a closer approximation of determining the Trigger Price because in the absence of a closing auction of a round lot or more, it would include consolidated last sale prices, and not just last sale prices on the Exchange, which is consistent with how other markets operate.
The Exchange believes that how it would process sell short orders during a Short Sale Period, set forth in proposed Rule 7.16P(f)(5), would remove impediments to and perfect the mechanism of a fair and orderly market because the proposed processing would assure that sell short orders would neither trade at the NBB or be displayed at the NBB, unless an order is eligible for an exemption pursuant to proposed Rule 7.16P(f)(6) or (f)(7). More specifically, the Exchange believes that the proposal to expand the existing reject option for sell short orders that would be required to be re-priced to apply also to resting orders would remove impediments to and perfect the mechanism of a fair and orderly market because it would be consistent with the intent of the instruction, which is to not have such orders re-price. The Exchange further believes that the proposed processing in Pillar of odd-lot orders that are ranked Priority 2, Pegged Orders, Cross Orders, and Tracking Orders would remove impediments to and perfect the mechanism of a fair and orderly market and is consistent with Rule 201 of Regulation SHO because the proposed processing would assure that such orders would not trade at the NBB or be displayed at the NBB as the NBB moves both up and down.
With respect to proposed Rule 7.11P, the Exchange believes that the proposed substantive difference to expand the number of Limit Orders eligible for re-pricing instructions would be consistent with the LULD Plan, and therefore would remove impediments to and perfect the mechanism of a fair and orderly market, because the proposed re-pricing of such orders would assure that such orders would not trade at or be displayed at prices outside of the Price Bands. The Exchange further believes that expanding the number of orders eligible for re-pricing instructions would provide ETP Holders with more options regarding how orders would be processed in compliance with the LULD Plan. With respect to MPL Orders, the Exchange believes that proposed Rule 7.11P(a)(6)(C) would remove impediments to and perfect the mechanism of a fair and orderly market because the proposal would provide ETP Holders with the choice for such orders not to be cancelled, and instead remain on the NYSE Arca Book until such time that the working price would be at a price eligible to trade consistent with the LULD Plan. The Exchange further believes that using Pillar terminology to describe how orders would be re-priced would promote consistency in Exchange rules, making them easier to navigate.
With respect to proposed Rule 7.38P, the Exchange believes that the proposed rule would promote consistency in the Exchange's rule book by using Pillar terminology to describe how the Exchange would price odd lot orders so that they would not trade through the PBBO. The Exchange further believes that proposed Rule 7.38P(b)(2) would remove impediments to and perfect the mechanism of a fair and orderly market because it would promote transparency in Exchange rules regarding the working time that would be assigned to an order that has been partially routed and if when it returns, would be displayed as a new BBO. The proposed assignment of the working time of the returned order would assure that such new BBO, which would be comprised of the returned quantity together with the resting odd-lot quantity, would be evaluated for whether it would lock or cross a protected quotation.
Finally, the Exchange believes that proposed Rule 7.10P, regarding clearly erroneous executions, would remove impediments to and perfect the mechanism of a fair and orderly market because it would use Pillar terminology, without any substantive differences from current Rule 7.10.
The Exchange does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. The proposed change is not designed to address any competitive issue but rather to adopt new rules to support the Exchange's new Pillar trading platform. As discussed in detail above, the Exchange proposes new rules for Pillar to address trading halts, Short Sales, the LULD Plan, and odd lots, which would be based on current rules with both substantive and non-substantive differences. The proposed substantive differences would promote competition because the Exchange would be offering functionality that is consistent with the proposed new orders and modifiers, as discussed in the Pillar II Filing, in a manner consistent with Rule 201 of Regulation SHO and the LULD Plan and to assure that odd lot orders would not
No written comments were solicited or received with respect to the proposed rule change.
Within 45 days of the date of publication of this notice in the
(A) By order approve or disapprove the proposed rule change, or
(B) institute proceedings to determine whether the proposed rule change
should be disapproved.
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Brent J. Fields, Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
On November 14, 2014, Financial Industry Regulatory Authority, Inc. (“FINRA”) filed with the Securities and Exchange Commission (“SEC” or “Commission”), pursuant to section 19(b)(1) of the Securities Exchange Act of 1934 (“Act” or “Exchange Act”)
This order approves the proposed rule change.
As described more fully in the Notice, FINRA proposed to adopt FINRA Rule 2242 to address conflicts of interest relating to the publication and distribution of debt research reports. Proposed FINRA Rule 2242 would adopt a tiered approach that FINRA believed, in general, would provide retail debt research recipients with extensive protections similar to those provided to recipients of equity research under current and proposed FINRA rules,
As stated above, the Commission received five comments on the proposal. All of the relevant commenters expressed general support for the proposal. Of the four comments received in regards to the proceedings or Amendment No. 1, one was supportive of the proposal as amended by Amendment No. 1 with certain specific comments,
FINRA represented that most of the defined terms closely follow the defined terms for equity research in NASD Rule 2711, as amended by the equity research filing, with minor changes to reflect their application to debt research. The proposed definitions are set forth below.
Under the proposed rule change, the term “debt research analyst” would mean an associated person who is primarily responsible for, and any associated person who reports directly or indirectly to a debt research analyst in connection with, the preparation of the substance of a debt research report, whether or not any such person has the job title of “research analyst.”
The proposed rule change would define the term “debt research report” as any written (including electronic) communication that includes an analysis of a debt security or an issuer of a debt security and that provides information reasonably sufficient upon which to base an investment decision, excluding communications that solely constitute an equity research report as defined in proposed Rule 2241(a)(11).
Communications that constitute statutory prospectuses that are filed as part of the registration statement would not be included in the definition of a debt research report. Further, communications that constitute private placement memoranda and comparable offering-related documents, other than those that purport to be research, would not be included in the definition of a debt research report. In general, the term debt research report also would not include communications that are limited to the following, if they do not include an analysis of, or recommend or rate, individual debt securities or issuers:
• Discussions of broad-based indices;
• Commentaries on economic, political, or market conditions;
• Commentaries on or analyses of particular types of debt securities or characteristics of debt securities;
• Technical analyses concerning the demand and supply for a sector, index, or industry based on trading volume and price;
• Recommendations regarding increasing or decreasing holdings in particular industries or sectors or types of debt securities; or
• Notices of ratings or price target changes, provided that the member simultaneously directs the readers of the notice to the most recent debt research report on the subject company that includes all current applicable disclosures required by the rule and that such debt research report does not contain materially misleading disclosures, including disclosures that are outdated or no longer applicable.
The term debt research report also, in general, would not include the following communications, even if they include an analysis of an individual debt security or issuer and information
• Statistical summaries of multiple companies' financial data, including listings of current ratings that do not include an analysis of individual companies' data;
• An analysis prepared for a specific person or a limited group of fewer than 15 persons;
• Periodic reports or other communications prepared for investment company shareholders or discretionary investment account clients that discuss individual debt securities in the context of a fund's or account's past performance or the basis for previously made discretionary investment decisions; or
• Internal communications that are not given to current or prospective customers.
The proposed rule change would define the term “debt security” as any “security” as defined in section 3(a)(10) of the Exchange Act,
The proposed rule change would define the term “debt trader” as a person, with respect to transactions in debt securities, who is engaged in proprietary trading or the execution of transactions on an agency basis.
The proposed rule change would provide that the term “independent third-party debt research report” means a third-party debt research report, in which the person producing the report both (1) has no affiliation or business or contractual relationship with the distributing member or that member's affiliates that is reasonably likely to inform the content of its research reports, and (2) makes content determinations without any input from the distributing member or that member's affiliates.
The proposed rule change would define the term “investment banking department” as any department or division, whether or not identified as such, that performs any investment banking service on behalf of a member.
The proposed rule change would define the term “member of a debt research analyst's household” as any individual whose principal residence is the same as the debt research analyst's principal residence.
The proposed rule change would define “public appearance” as any participation in a conference call, seminar, forum (including an interactive electronic forum) or other public speaking activity before fifteen or more persons or before one or more representatives of the media, a radio, television or print media interview, or the writing of a print media article, in which a debt research analyst makes a recommendation or offers an opinion concerning a debt security or an issuer of a debt security.
Under the proposed rule change the term “qualified institutional buyer” has the same meaning as under Rule 144A of the Securities Act.
The proposed rule change would define “research department” as any department or division, whether or not identified as such, that is principally responsible for preparing the substance of a debt research report on behalf of a member.
Similar to the proposed equity research rule, the proposed rule change contains an overarching provision that would require members to establish, maintain, and enforce written policies and procedures reasonably designed to identify and effectively manage conflicts of interest related to the preparation, content, and distribution of debt research reports; public appearances by debt research analysts; and the interaction between debt research analysts and persons outside of the research department, including investment banking, sales and trading and principal trading personnel, subject companies, and customers.
The written policies and procedures would be required to be reasonably designed to promote objective and reliable debt research that reflects the truly held opinions of debt research analysts and to prevent the use of debt research reports or debt research analysts to manipulate or condition the market or favor the interests of the firm or current or prospective customers or class of customers.
The proposed rule change would introduce a distinction between sales and trading personnel and persons engaged in principal trading activities, where, in FINRA's opinion, the conflicts addressed by the proposal are of most concern.
FINRA proposed that the required policies and procedures would be required to prohibit prepublication review, clearance or approval of debt research by persons involved in investment banking, sales and trading, or principal trading, and either restrict or prohibit such review, clearance, and approval by other non-research personnel other than legal and compliance.
With respect to coverage decisions, a member's written policies and procedures would be required under the proposal to restrict or limit input by investment banking, sales and trading and principal trading personnel to ensure that research management independently makes all final decisions regarding the research coverage plan.
A member's written policies and procedures also would be required under the proposal to restrict or limit activities by debt research analysts that can reasonably be expected to compromise their objectivity.
The proposed rule change also would prohibit investment banking personnel from directing debt research analysts to engage in sales or marketing efforts related to an investment banking services transaction or any communication with a current or prospective customer about an investment banking services transaction.
A member's written policies and procedures would be required under the proposal to limit the supervision of debt research analysts to persons not engaged in investment banking, sales and trading or principal trading activities.
A member's written policies and procedures also would be required under the proposal to limit the determination of a firm's debt research department budget to senior management, excluding senior management engaged in investment banking or principal trading activities, and without regard to specific revenues or results derived from investment banking.
With respect to compensation determinations, a member's written policies and procedures would be required under the proposal to prohibit compensation based on specific investment banking services or trading transactions or contributions to a firm's investment banking or principal trading activities and prohibit investment banking and principal trading personnel from input into the compensation of debt research analysts.
Neither investment banking personnel nor persons engaged in principal trading activities would be required under the proposal to give input with respect to the compensation determination for debt research analysts. However, sales and trading personnel would be permitted to give input to debt research management as part of the evaluation process in order to convey customer
Under the proposed rule change, a member's written policies and procedures would be required to restrict or limit trading by a “debt research analyst account” in securities, derivatives and funds whose performance is materially dependent upon the performance of securities covered by the debt research analyst.
The proposed rule change includes Supplementary Material .10, which would provide that FINRA would not consider a research analyst account to have traded in a manner inconsistent with a research analyst's recommendation where a member has instituted a policy that prohibits any research analyst from holding securities, or options on or derivatives of such securities, of the companies in the research analyst's coverage universe, provided that the member establishes a reasonable plan to liquidate such holdings consistent with the principles in paragraph (b)(2)(J)(i) and such plan is approved by the member's legal or compliance department.
A member's written policies and procedures would be required to prohibit direct or indirect retaliation or threat of retaliation against debt research analysts by any employee of the firm for publishing research or making a public appearance that may adversely affect the member's current or prospective business interests.
The proposed rule change would establish limitations regarding joint due diligence activities—
The proposed rule change delineates what would be the prohibited and permissible interactions between debt research analysts and sales and trading and principal trading personnel. The proposed rule change would require members to establish, maintain and enforce written policies and procedures reasonably designed to prohibit sales and trading and principal trading personnel from attempting to influence a debt research analyst's opinions or views for the purpose of benefiting the trading position of the firm, a customer or a class of customers.
The proposed rule change would permit sales and trading and principal trading personnel to communicate customers' interests to a debt research analyst, so long as the debt research analyst does not respond by publishing debt research for the purpose of benefiting the trading position of the firm, a customer or a class of customers.
The proposed rule change also would permit sales and trading and principal
The proposed rule change clarifies that communications between debt research analysts and sales and trading or principal trading personnel that are not related to sales and trading, principal trading or debt research activities would be permitted to take place without restriction, unless otherwise prohibited.
The proposed rule change would apply standards to communications with customers and internal sales personnel. Any written or oral communication by a debt research analyst with a current or prospective customer or internal personnel related to an investment banking services transaction would be required to be fair, balanced and not misleading, taking into consideration the overall context in which the communication is made.
Consistent with the proposed prohibition on investment banking department personnel directly or indirectly directing a debt research analyst to engage in sales or marketing efforts related to an investment banking services transaction or directing a debt research analyst to engage in any communication with a current or prospective customer about an investment banking services transaction, no debt research analyst would be permitted to engage in any communication with a current or prospective customer in the presence of investment banking department personnel or company management about an investment banking services transaction.
The proposed rule change would, in general, adopt the disclosures in the equity research rule for debt research, with modifications to reflect the different characteristics of the debt market. The proposed rule change would require members to establish, maintain and enforce written policies and procedures reasonably designed to ensure that purported facts in their debt research reports are based on reliable information.
Consistent with the equity rules, irrespective of the rating system a member employs, a member would be required to include in each debt research report limited to the analysis of an issuer of a debt security that includes a rating of the subject company the percentage of all subject companies rated by the member to which the member would assign a “buy,” “hold” or “sell” rating.
If a debt research report limited to the analysis of an issuer of a debt security contains a rating for the subject company and the member has assigned a rating to such subject company for at least one year, the debt research report would be required to show each date on which a member has assigned a rating to the debt security and the rating assigned on such date. This information would be required for the period that the member has assigned any rating to the debt security or for a three-year period, whichever is shorter.
The proposed rule change would require a member to disclose in any debt research report at the time of publication or distribution of the report:
• If the debt research analyst or a member of the debt research analyst's household has a financial interest in the debt or equity securities of the subject company (including, without limitation, any option, right, warrant, future, long or short position), and the nature of such interest;
• If the debt research analyst has received compensation based upon (among other factors) the member's investment banking, sales and trading or principal trading revenues;
• If the member or any of its affiliates managed or co-managed a public offering of securities for the subject company in the past 12 months, received compensation for investment banking services from the subject company in the past 12 months, or expects to receive or intends to seek compensation for investment banking
• If, as of the end of the month immediately preceding the date of publication or distribution of a debt research report (or the end of the second most recent month if the publication date is less than 30 calendar days after the end of the most recent month), the member or its affiliates have received from the subject company any compensation for products or services other than investment banking services in the previous 12 months;
• If the subject company is, or over the 12-month period preceding the date of publication or distribution of the debt research report has been, a client of the member, and if so, the types of services provided to the issuer. Such services, if applicable, shall be identified as either investment banking services, non-investment banking securities-related services or non-securities services;
• If the member trades or may trade as principal in the debt securities (or in related derivatives) that are the subject of the debt research report;
• If the debt research analyst received any compensation from the subject company in the previous 12 months; and
• Any other material conflict of interest of the debt research analyst or member that the debt research analyst or an associated person of the member with the ability to influence the content of a debt research report knows or has reason to know at the time of the publication or distribution of a debt research report.
The proposed rule change would incorporate a proposed amendment to the corresponding provision in the equity research rules that expands the existing “catch all” disclosure to require disclosure of material conflicts known not only by the research analyst, but also by any “associated person of the member with the ability to influence the content of a research report.” The proposed rule change defines a person with the “ability to influence the content of a research report” as an associated person who is required to review the content of the debt research report or has exercised authority to review or change the debt research report prior to publication or distribution. This term would not include legal or compliance personnel who may review a debt research report for compliance purposes but are not authorized to dictate a particular recommendation or rating.
The proposed rule change would mandate disclosure of firm ownership of debt securities in research reports or a public appearance to the extent those holdings constitute a material conflict of interest.
The proposed rule change would adopt an exception for disclosure that would reveal material non-public information regarding specific potential future investment banking transactions.
Like the equity research rule, the proposed rule change would permit a member that distributes a debt research report covering six or more companies (compendium report) to direct the reader in a clear manner to the applicable disclosures. Electronic compendium reports would be required to include a hyperlink to the required disclosures. Paper-based compendium reports would be required to provide either a toll-free number or a postal address to request the required disclosures and also may include a web address of the member where the disclosures can be found.
The proposed rule change would provide that a member would not be required to disclose receipt of non-investment banking services compensation by an affiliate if it has implemented written policies and procedures reasonably designed to prevent the debt research analyst and associated persons of the member with the ability to influence the content of debt research reports from directly or indirectly receiving information from the affiliate as to whether the affiliate received such compensation.
The proposed rule change closely parallels the equity research rules with respect to disclosure in public appearances. Under the proposed rule, a debt research analyst would be required to disclose in public appearances:
• If the debt research analyst or a member of the debt research analyst's household has a financial interest in the debt or equity securities of the subject company (including, without limitation, whether it consists of any option, right, warrant, future, long or short position), and the nature of such interest;
• If, to the extent the debt research analyst knows or has reason to know, the member or any affiliate received any compensation from the subject company in the previous 12 months;
• If the debt research analyst received any compensation from the subject company in the previous 12 months;
• If, to the extent the debt research analyst knows or has reason to know, the subject company currently is, or during the 12-month period preceding the date of publication or distribution of the debt research report, was, a client of the member. In such cases, the debt research analyst also must disclose the
• Any other material conflict of interest of the debt research analyst or member that the debt research analyst knows or has reason to know at the time of the public appearance.
However, a member or debt research analyst would not be required to make any such disclosure to the extent it would reveal material non-public information regarding specific potential future investment banking transactions.
The proposed rule change would require members to maintain records of public appearances by debt research analysts sufficient to demonstrate compliance by those debt research analysts with the applicable disclosure requirements for public appearances. Such records would be required to be maintained for at least three years from the date of the public appearance.
With respect to both research reports and public appearances, the proposed rule change would require that, in addition to the disclosures required under the proposed rule, members and debt research analysts comply with all applicable disclosure provisions of FINRA Rule 2210 (Communications with the Public) and the federal securities laws.
The proposed rule change would require firms to establish, maintain and enforce written policies and procedures reasonably designed to ensure that a debt research report is not distributed selectively to internal trading personnel or a particular customer or class of customers in advance of other customers that the member has previously determined are entitled to receive the debt research report.
In addition, a member that provides different debt research products and services for certain customers would be required to inform its other customers that its alternative debt research products and services may reach different conclusions or recommendations that could impact the price of the debt security.
FINRA proposed to apply the supervisory review and disclosure obligations applicable to the distribution of third-party equity research similarly to third-party retail debt research. Moreover, the proposed rule change would incorporate the current standards for third-party equity research, including the distinction between independent and non-independent third-party research with respect to the review and disclosure requirements. In addition, the proposed rule change would adopt an expanded requirement in the proposed equity research rules that requires members to disclose any other material conflict of interest that can reasonably be expected to have influenced the member's choice of a third-party research provider or the subject company of a third-party research report.
The proposed rule change would prohibit a member from distributing third-party debt research if it knows or has reason to know that such research is not objective or reliable.
In addition, the proposed rule change would require a member to establish, maintain, and enforce written policies and procedures reasonably designed to ensure that any third-party debt research report it distributes contains no untrue statement of material fact and is otherwise not false or misleading.
The proposed rule change would require that a member accompany any third-party debt research report it distributes with, or provide a web address that directs a recipient to, disclosure of any material conflict of interest that can reasonably be expected to have influenced the choice of a third-party debt research report provider or the subject company of a third-party debt research report, including:
• If the member or any of its affiliates managed or co-managed a public offering of securities for the subject company in the past 12 months, received compensation for investment banking services from the subject company in the past 12 months, or expects to receive or intends to seek compensation for investment banking services from the subject company in the next three months;
• If the member trades or may trade as principal in the debt securities (or in related derivatives) that are the subject of the debt research report; and
• Any other material conflict of interest of the debt research analyst or member that the debt research analyst or an associated person of the member with the ability to influence the content of a debt research report knows or has reason to know at the time of the publication or distribution of a debt research report.
The proposed rule change would not require members to review a third-party debt research report prior to distribution if such debt research report is an independent third-party debt research report.
The proposed rule would require that members ensure that third-party debt research reports are clearly labeled as such and that there is no confusion on the part of the recipient as to the person or entity that prepared the debt research reports.
The proposed rule change would clarify the obligations of each associated person under those provisions of the proposed rule that require a member to restrict or prohibit certain conduct by establishing, maintaining, and enforcing particular policies and procedures. Specifically, the proposed rule change provides that, consistent with FINRA Rule 0140, persons associated with a member would be required to comply with such member's written policies and procedures as established pursuant to the proposed rule. In addition, consistent with Rule 0140, the proposed rule states in Supplementary Material .08 that it would be a violation of proposed Rule 2242 for an associated person to engage in the restricted or prohibited conduct to be addressed through the establishment, maintenance, and enforcement of written policies and procedures required by provisions of FINRA Rule 2242, including applicable supplementary material.
Similar to the equity research rule, the proposed rule change would exempt from certain provisions regarding supervision and compensation of debt research analysts those members that over the previous three years, on average per year, have participated in ten or fewer investment banking services transactions as manager or co-manager and generated $5 million or less in gross investment banking revenues from those transactions.
While small investment banks may need those who supervise debt research analysts under such circumstances also to be involved in the determination of those analysts' compensation, the proposal would still prohibit these firms from compensating a debt research analyst based upon specific investment banking services transactions or contributions to a member's investment banking services activities. Members that qualify for this exemption would be required to maintain records sufficient to establish eligibility for the exemption and also maintain for at least three years any communication that, but for this exemption, would be subject to all of the requirements of proposed FINRA Rule 2242(b).
The proposed rule change includes an exemption from certain provisions regarding supervision and compensation of debt research analysts for members that engage in limited principal trading activity where: (1) In absolute value on an annual basis, the member's trading gains or losses on principal trades in debt securities are $15 million or less over the previous three years, on average per year; and (2) The member employs fewer than 10 debt traders; provided, however, that such members establish information barriers or other institutional safeguards reasonably designed to ensure debt research analysts are insulated from pressure by persons engaged in principal trading or sales and trading activities or other persons who might be biased in their judgment or supervision.
As with the limited investment banking activity exemption, members
Given the debt market and the needs of its participants, the proposed rule change would exempt debt research distributed solely to eligible institutional investors (“institutional debt research”) from most of the provisions regarding supervision, coverage determinations, budget and compensation determinations, and all of the disclosure requirements applicable to debt research reports distributed to retail investors (“retail debt research”).
The proposed rule distinguishes between larger and smaller institutions in the manner in which their opt-in decision is obtained. Larger institutions would be permitted to receive institutional debt research based on negative consent, while smaller institutions would be required to affirmatively consent in writing to receive that research.
Specifically, the proposed rule would allow firms to distribute institutional debt research by negative consent to a person who meets the definition of a qualified institutional buyer (“QIB”)
Institutional accounts that meet the definition of FINRA Rule 4512(c) but do not satisfy the higher tier requirements described above would still be permitted to affirmatively elect in writing to receive institutional debt research. Specifically, a person that meets the definition of “institutional account” in FINRA Rule 4512(c) would be permitted to receive institutional debt research provided that such person, prior to receipt of a debt research report, has affirmatively notified the member in writing that it wishes to receive institutional debt research and forego treatment as a retail investor for the purposes of the proposed rule. Members would not be permitted to allow retail investors to choose to receive institutional debt research.
FINRA stated that, to avoid a disruption in the receipt of institutional debt research, the proposed rule change would allow firms to send institutional debt research to any FINRA Rule 4512(c) account, except a natural person, without affirmative or negative consent for a period of up to one year after Commission approval of the proposed rule change while they obtain the necessary consents. Natural persons that qualify as an institutional account under FINRA Rule 4512(c) would be required to provide affirmative consent to receive institutional debt research during this transition period and thereafter.
The proposed exemption would permit members that distribute institutional debt research to institutional investors to do so without meeting the proposed requirements to have written policies and procedures for this research with respect to: (1) Restricting or prohibiting prepublication review of institutional debt research by principal trading and sales and trading personnel or others outside the research department, other than investment banking personnel; (2) Input by investment banking, principal trading and sales and trading into coverage decisions; (3) Limiting supervision of debt research analysts to persons not engaged in investment banking, principal trading or sales and trading activities; (4) Limiting determination of the debt research department's budget to senior management not engaged in investment banking or principal trading activities and without regard to specific revenues derived from investment banking; (5) Determination of debt research analyst compensation; (6) Restricting or limiting debt research analyst account trading; and (7) Information barriers or other institutional safeguards reasonably designed to ensure debt research analysts are insulated from review or oversight by investment banking, sales and trading or principal trading personnel, among others (but members still must have written policies and procedures to guard against those persons pressuring analysts). The exemption further would apply to all disclosure requirements, including content and disclosure requirements for third-party research.
Notwithstanding the proposed exemption, some provisions of the proposed rule still would apply to institutional debt research, including the prohibition on prepublication review of debt research reports by investment banking personnel and the restrictions on such review by subject companies. While prepublication review by principal trading and sales and trading personnel would not be prohibited pursuant to the exemption, other provisions of the rule would continue to require management of those conflicts, including the requirement to establish information barriers reasonably designed to insulate debt research analysts from pressure by those persons. Furthermore, the requirements in Supplementary
While the proposed rule change would not require institutional debt research to carry the specific disclosures applicable to retail debt research, it would require that such research carry general disclosures prominently on the first page warning that: (1) The report is intended only for institutional investors and does not carry all of the independence and disclosure standards of retail debt research reports; (2) If applicable, that the views in the report may differ from the views offered in retail debt research reports; and (3) If applicable, that the report may not be independent of the firm's proprietary interests and that the firm trades the securities covered in the report for its own account and on a discretionary basis on behalf of certain customers, and such trading interests may be contrary to the recommendation in the report.
The proposed rule change would require members to establish, maintain and enforce written policies and procedures reasonably designed to ensure that institutional debt research is made available only to eligible institutional investors.
The proposed rule change would provide FINRA, pursuant to the FINRA Rule 9600 Series, with authority to conditionally or unconditionally grant, in exceptional and unusual circumstances, an exemption from any requirement of the proposed rule for good cause shown, after taking into account all relevant factors and provided that such exemption is consistent with the purposes of the rule, the protection of investors, and the public interest.
In response to the proposal as originally proposed by FINRA, the Commission received five comments on the proposal.
All five of the commenters to the original proposal,
The rule proposal as originally proposed would have adopted a policies and procedures approach to identification and management of research-related conflicts of interest and require those policies and procedures to, at a minimum, prohibit or restrict particular conduct. Commenters to the original proposal expressed several concerns with the approach.
Two of these commenters asserted that the mix of a principles-based approach with prescriptive requirements was confusing in places and posed operational challenges. In particular, the commenters recommended eliminating the minimum standards for the policies and procedures.
FINRA, in response, stated it believes the framework will maintain the same level of investor protection in the current equity rules (which also would largely apply to retail debt research) while providing both some flexibility for firms to align their compliance systems with their business model and philosophy and imposing additional obligations to proactively identify and manage emerging conflicts. According to FINRA the proposal, even under a policies and procedures approach, “would effectively maintain, with some modifications, the key proscriptions in the current rules”
In light of the overarching principle that requires firms to establish, maintain, and enforce written policies and procedures reasonably designed to identify and effectively manage research-related conflicts, FINRA clarified that the “at a minimum” language was meant to convey that additional conflicts management policies and procedures may be needed to address emerging conflicts that may arise as the result of business changes, such as new research products, affiliations or distribution methods at a particular firm. As discussed in the Notice, FINRA stated that it intends for firms to proactively identify and manage those conflicts with appropriately designed policies and procedures. FINRA clarified that their inclusion of the “at a minimum” language was not, in their opinion, intended to suggest that firms' written policies and procedures must go beyond the specified prohibitions and restrictions in the proposal where no new conflicts have been identified. However, FINRA stated it believes the overarching requirement for policies and procedures reasonably designed to identify and effectively manage research-related conflicts suffices to achieve the intended regulatory objective, and therefore to eliminate any confusion, FINRA proposed to amend the proposals to delete the “at a minimum” language in Amendment No. 1. One of the commenters that raised this issue noted their approval of this change in their second letter.
FINRA stated that it appreciates the commenters' concerns with respect to language in the supplementary material that would make a violation of a firm's policies a violation of the underlying rule. They further stated that the supplementary material was intended to hold individuals responsible for engaging in the conduct that the policies and procedures effectively restrict or prohibit. FINRA agreed that purpose is achieved with the language in the supplementary material that states that, consistent with FINRA Rule 0140, “it shall be a violation of [the Rule] for an associated person to engage in the restricted or prohibited conduct to be addressed through the establishment, maintenance and enforcement of policies and procedures required by [the Rule] or related Supplementary Material.” Therefore, FINRA proposed, in Amendment No. 1, to amend the proposals to delete the language stating that a violation of a firm's policies and procedures shall constitute a violation of the rule itself. One of the commenters that raised this issue noted their approval of this change in their second letter.
Another of the original commenters, in a second letter, repeated their concerns about utilizing a principles-based method in a rule in this area, noting that a proscriptive approach is known to be generally effective at addressing the types of conflicts of interest that the proposal is designed to address and repeated violations by industry of the current proscriptive equity research rule.
One commenter to the original proposal requested that the proposal define the term “sales and trading personnel” as “persons who are primarily responsible for performing sales and trading activities, or exercising direct supervisory authority over such persons.”
One commenter to the original proposal asked FINRA to include an exclusion from the definition of “debt research report” for private placement memoranda and similar offering-related documents prepared in connection with investment banking services transactions.
As FINRA had noted with respect to the definition of “research report” in the equity research filing, they also noted that a “debt research report” is generally understood not to include such offering-related documents prepared in connection with investment banking services transactions. In the course of administering the filing review programs under FINRA Rules 2210 (Communications with the Public), 5110 (Corporate Financing Rule), 5122 (Member Private Offerings) and 5123 (Private Placements of Securities), FINRA stated it had not received any inquiries or addressed any issues that indicate there is confusion regarding the scope of the research analyst rules as applied to offering-related documents prepared in connection with investment banking activities. Regardless, to provide firms with greater clarity as to the status of such offering-related documents under the proposals, FINRA proposed to amend the proposed rule as part of Amendment No. 1 to exclude private placement memoranda and similar offering-related documents prepared in connection with investment banking services transactions other than those that purport to be research from the definition of “debt research report.” In their second comment letter, the commenter expressed support for this change.
One commenter to the original proposal asked FINRA to refrain from using the concept of “reliable” research in the proposal as it may inappropriately connote accuracy in the context of a research analyst's opinions.
One commenter to the original proposal asked FINRA to eliminate as redundant the term “independently” from the provisions permitting non-research personnel to have input into research coverage, so long as research management “independently makes all final decisions regarding the research coverage plan.”
One commenter to the original proposal requested that the proposal define the terms “principal trading activities,” “principal trading personnel,” and “persons engaged in principal trading activities” to exclude traders who are primarily involved in customer accommodation or customer facilitation trading, such as market makers that trade on a principal basis.
The proposal would allow sales and trading personnel, but not personnel engaged in principal trading activities, to provide input to debt research management into the evaluation of debt research analysts. As discussed in detail in the Notice in response to the similar comment raised to earlier iterations of the debt proposal,
Another commenter to the original proposal asked for clarification of the term “principal trading” because it believes the term “sales and trading” already encompasses all agency, principal and proprietary trading activities.
One commenter to the original proposal suggested that FINRA revise the definition of “subject company” to specify that the term means the “
The proposed rule would require written policies and procedures to “establish information barriers or other institutional safeguards reasonably designed to ensure that research analysts are insulated from review, pressure or oversight by persons engaged in investment banking services activities or other persons, including sales and trading department personnel, who might be biased in their judgment or supervision.” Some commenters to the original proposal suggested that “review” was unnecessary in this provision because the review of debt research analysts was addressed sufficiently in other parts of the proposed rule.
One commenter to the original proposal asked FINRA to clarify that the information barriers or other institutional safeguards required by the proposed rule are not intended to prohibit or limit activities that would otherwise be permitted under other provisions of the rule.
This commenter stated in their comment in response to Amendment No. 1 that they interpreted this to mean that the proposal would permit members to allow persons engaged in sales and trading activities to provide informal and formal feedback on research analysts as one factor to be considered by research management for the purposes of the evaluation of the analyst.
The commenter also asserted that the terms “bias” and “pressure” are broad and ambiguous on their face and requested that FINRA clarify that for purposes of the information barriers requirement that they are intended to address persons who may try to improperly influence research.
One commenter to the original proposal asked FINRA to modify the information barriers or other institutional safeguards requirement to conform the provision to FINRA's “reasonably designed” standard for related policies and procedures.
One commenter to the original proposal opposed as overbroad the proposed expansion of the current “catch-all” disclosure requirement to include “any other material conflict of interest of the research analyst or member that a research analyst
FINRA stated it proposed the change to capture material conflicts of interest known by persons other than the research analyst (
FINRA stated it continues to believe that the catch-all provision must include persons with the ability to influence the content of a debt research report to avoid creating a gap where a supervisor or other person with the authority to change the content of a research report knows of a material conflict. However, FINRA clarified that it intended for the provision to capture only those individuals who are required to review the content of a particular research report or have exercised their authority to review or change the research report prior to publication or distribution. In addition, FINRA stated it did not intend to capture legal or compliance personnel who may review a research report for compliance purposes but are not authorized to dictate a particular recommendation or rating. FINRA proposed to amend the supplementary material in the proposals consistent with this clarification in Amendment No. 1. In addition, FINRA proposed to modify in Amendment No. 1 the exception in proposed Rules 2242(c)(5) and (d)(2) (applying to public appearances) so as to not require disclosure that would otherwise reveal material non-public information regarding specific potential future investment banking transactions, whether or not the transaction involves the subject company.
This commenter in their comment in response to Amendment No. 1, while expressing their support for these changes, asked FINRA to make a modification of the parties who trigger disclosure of any other material conflict of interest. Specifically, the commenter asked FINRA to limit this disclosure to only be required when someone has authority to dictate a particular recommendation, rating, or price target.
One commenter to the original proposal requested confirmation that members may rely on hyperlinked disclosures for research reports that are delivered electronically, even if these reports are subsequently printed out by customers.
The proposed rule change would require firms to establish, maintain and enforce written policies and procedures reasonably designed to ensure that a research report is not distributed selectively to internal trading personnel or a particular customer or class of customers in advance of other customers that the firm has previously determined are entitled to receive the research report. The proposals also include supplementary material that explains that firms may provide different research products to different classes of customers—
One commenter to the original proposal supported the provisions as proposed with general disclosure,
The opposing commenter stated that they believed that permitting contrary opinions while only disclosing the possibility of this contrary research to investors was insufficient to adequately protect investors because the use of “may” in a disclosure is not the same as disclosing that there actually are opposing opinions. Further, they questioned whether such disclosure was consistent with the Act in that it may contrary to Rule 10b-5 by permitting the omission of a material fact in the research report. They did not believe that the disclosure of actual opposing views would be burdensome on members as they should be aware of contrasting opinions. As a result, FINRA should require specific disclosures.
Another commenter to the original proposal expressed concern that the proposal raises issues about the parity of information received by retail and institutional investors, and whether research provided to institutional investors could contain views that differ from those in research to retail investors.
The supplementary material states that products may lead to different recommendations or ratings, provided that each is consistent with the member's ratings system for each respective product. In other words, according to FINRA, all differing recommendations or ratings must be reconcilable such that they are not truly at odds with one another. As such, the proposed rule change would not, in
Since the proposed rule change would not allow inconsistent recommendations that could mislead one or more investors, FINRA stated that it believes general disclosure of alternative products with different objectives and recommendations is appropriate relative to its investor protection benefits. The commenter who supported this approach expressed support for FINRA's decision in their second letter.
One commenter to the original proposal asked that FINRA clarify that members that have developed policies and procedures consistent with FINRA Rule 5280 (Trading Ahead of Research Reports) would also be in compliance with the debt proposal's expectation of structural separation between investment banking and debt research, and between sales and trading and principal trading and debt research.
FINRA also stated it believes that physical separation is an effective component to a reasonably designed compliance system that requires information barriers.
The same commenter asked that FINRA modify the prohibition on debt analyst attendance at road shows to permit passive participation since there is less opportunity to meet and assess issuer management than in the equity context.
A commenter to the original proposal asked FINRA to delete the term “attempting” in the proposed Supplementary Material .03(a)(1), which would require members to have policies and procedures reasonably designed to prohibit sales and trading and principal trading personnel from “attempting to influence a debt research analyst's opinion or views for the purpose of benefitting the trading position of the firm, a customer, or a class of customers.”
The commenter further expressed concern that the term “pending” is vague in the above-cited provision.
Proposed Supplementary Material .03(b)(3) would provide that, in determining what is consistent with a debt research analyst's published debt research for purposes of sharing certain views with sales and trading and principal trading personnel, members
One commenter to the original proposal expressed concern about the proposed requirements that a member disclose in retail debt research reports its distribution of all debt security ratings (and the percentage of subject companies in each buy/hold/sell category for which the member has provided investment banking services within the previous twelve months) and historical ratings information on the debt securities that are the subject of the debt research report for a period of three years or the time during which the member has assigned a rating, whichever is shorter.
FINRA stated it believes that, similar to the current equity rules, to the extent that a firm produces retail debt research that assigns a rating to an issuer—
While FINRA also believes that the disclosures would be valuable to retail investors with respect to debt research on individual debt securities, FINRA stated it recognizes the additional complexity and cost associated with compliance, particularly where a retail debt research report may include multiple ratings of individual debt securities, some of which may be positive and others negative or neutral. FINRA stated it believes it would be beneficial to obtain additional information about the array of debt research products that are now being distributed to retail investors, as well as the operational challenges and costs to apply these disclosure provisions to debt research on individual debt securities. Accordingly, FINRA proposed in Amendment No. 1 to eliminate for now the requirements with respect to debt research reports on individual debt securities. FINRA stated it will reconsider the appropriateness of the disclosure requirements as applied to research on individual debt securities after obtaining and assessing the additional information.
The same commenter also requested that FINRA allow members to provide a hyperlink or web address to web-based disclosures in all debt research reports, rather than requiring the disclosures within a printed report.
The proposed rule change would exempt debt research provided solely to certain eligible institutional investors from many of the proposed rule's provisions, provided that a member obtains consent from the institutional investor to receive that research and the research reports contain specified disclosure to alert recipients that the reports do not carry the same protections as retail debt research. The proposal distinguishes between larger and smaller institutions in the manner in which the consent must be obtained. Firms would be permitted to use negative consent where the customer meets the definition of a QIB and satisfies the institutional suitability standards of FINRA Rule 2111 with respect to debt transactions and strategies. Institutional accounts that meet the definition of FINRA Rule 4512(c), but do not satisfy the higher tier standard required for negative consent, would be permitted to affirmatively elect in writing to receive institutional debt research.
One commenter to the original proposal opposed providing any exemption for debt research distributed solely to eligible institutional investors, contending that it would deprive the
Another commenter to the original proposal supported the proposed tiered approach for how institutional investors may receive research reports.
FINRA stated in the Notice and Amendment Notice that it believes an institutional exemption is appropriate to allow more sophisticated institutional market participants that can assess risks associated with debt trading and are aware of conflicts that may exist between a member's recommendations and trading interests, to continue to receive the timely flow of analysis and trade ideas that they value. FINRA noted that institutional debt research still would remain subject to several provisions of the rules, including the required separation between debt research and investment banking and the requirements for conflict management policies and procedures to insulate debt analysts from pressure by traders and others. In addition, FINRA noted that no institutional investor will be exposed to this less-protected institutional research without either negative or affirmative consent, as applicable.
FINRA noted, with regard to the standard for negative consent, it does not believe that less sophisticated institutional investors should be required to take any additional steps to receive the full protections of the proposed rules. To the extent the QIB standard for negative consent is too difficult to implement, the proposal would provide an alternative to obtain a one-time affirmative consent for any Rule 4512(c) institutional account and further provides a one-year grace period to obtain that consent, so as not to disrupt the current flow of debt research to institutional customers. As discussed in the rule filing, FINRA included the alternative methods of consent and the grace period to satisfy the differing industry views on which of two consent options would be most cost effective.
Another commenter to the original proposal asked that FINRA confirm that, in distributing debt research reports under the institutional debt research framework to certain non-U.S. institutional investors who are customers of a member's non-U.S. broker-dealer affiliate, the member may rely on similar classifications in the non-U.S. institutional investors' home jurisdictions.
The same commenter asked FINRA to clarify the application of the institutional debt research framework to desk analysts or other personnel who are part of the trading desk and are not “research department” personnel. In particular, the commenter suggested that proposed Rules 2242(b)(2)(H) (with respect to pressuring) and (b)(2)(L) (which would require policies and procedures reasonably designed to, among other things, restrict or limit activities by debt research analysts that can reasonably be expected to compromise their objectivity) should not apply when sales and trading personnel or principal trading personnel publish debt research reports in reliance on the institutional research exemption because the requirements of those provisions cannot be reconciled with the inherent nature of conflicts present.
The proposed rule change would exempt members with limited principal trading activity or limited investment banking activity from the review, supervision, budget, and compensation provisions in the proposed rule related to principal trading and investment banking personnel, respectively. The limited principal trading exemption would apply to firms that engage in principal trading activity where, in absolute value on an annual basis, the member's trading gains or losses on principal trades in debt securities are $15 million or less over the previous three years, on average per year, and the member employs fewer than ten debt traders. The limited investment banking exemption would apply, as it does in the equity rules, to firms that have managed or co-managed ten or fewer investment banking services
One commenter to the original proposal questioned whether the exemptions could compromise the independence and accuracy of the analysis and opinions provided.
FINRA stated in the Notice and the Amendment Notice that it included the exemptions to balance the burdens of compliance with the level or risk to investors. FINRA stated that it determined the thresholds for each exemption based on data analysis and a survey of firms that engage in principal trading activity or investment banking activity, respectively. FINRA clarified that it has not found abuses with respect to the limited investment banking exemption in the equity context and notes that some important separation requirements would still apply to the eligible firms, such as the prohibition on compensating a debt research analyst based on a specific investment banking transaction or contributions to a member's investment banking services activities.
FINRA clarified that the proposed limited principal trading exemption would apply where, based on the survey and data analysis, it reasonably believes the amount of potential principal trading profits poses appreciably lower risk of pressure on debt research analysts by sales and trading or principal trading personnel and where there would be a significant marginal cost to add a trader dedicated to producing research relative to the increase in investor protection. FINRA further noted that the proposal would still prohibit debt research analysts at exempt firms from being compensated based on specific trading transactions.
With respect to both exemptions, as the commenter noted, firms would still be required to establish information barriers or other institutional safeguards reasonably designed to ensure debt research analysts are insulated from pressure by persons engaged in investment banking or principal trading activities, among others. FINRA stated it believes a number of policies could be implemented to achieve compliance with this requirement. For example, in the context of principal trading, these measures might include monitoring of communications between debt research analysts and individuals on the trading desk and reviewing published research in relation to transactions executed by the firm in the subject company's debt securities. FINRA also noted that neither exemption would allow trading ahead of research by firm traders, as FINRA Rule 5280 would continue to apply to both debt and equity research and prohibits such conduct. Finally, as noted by the commenter, FINRA stated it intends to monitor the research produced by firms that avail themselves of the exemptions to assess whether the thresholds to qualify for the exemptions are appropriate or should be modified.
The commenter responded in its second letter that, while FINRA addressed their concerns, they still had concerns that the examples given by FINRA in the Amendment Notice were insufficient. They recommended additional guidance by FINRA to help ensure adequate compliance. They also approved of FINRA's commitment to continue to monitor this issue and urged publication of the results.
One commenter to the original proposal asked FINRA to consider amending FINRA Rule 2210 to exclude debt research reports from that rule's filing requirements, since there is an exception from the filing requirements for equity research reports that concern only equity securities that trade on an exchange.
One commenter to the original proposal requested that the implementation date be at least twelve months after Commission approval of the proposed rule change and that FINRA sequence the compliance dates of the equity research filing and the proposed rule change in that order.
The Commission has carefully considered the proposed rule change, all of the comments received, and FINRA's responses to the comments. Based on its review of the record, the Commission finds that the proposed rule change, as amended by Amendment No. 1, is consistent with the requirements of the Act and the rules and regulations thereunder applicable to a national securities association.
FINRA stated in its proposal that it “believes that the proposed rule change would promote increased quality, objectivity and transparency of debt research distributed to investors by requiring firms to identify and mitigate conflicts in the preparation and distribution of such research” and that “the [proposed] rule will provide investors with more reliable information on which to base investment decisions in debt securities, while maintaining timely flow of information important to institutional market participants and providing those institutional investors with appropriate safeguards.”
We generally agree with these assertions. The potential abuses spawned by the conflicts of interest between research and the business interests of broker-dealers in the equity space are well-known and well-established.
Regarding concerns raised by commenters regarding the principles-based structure of the proposal, we note the proposed rule change establishes the key provisions of NASD Rule 2711 for debt research and includes a number of protections for investors beyond those currently found in that rule, including the requirement that research management make independent decisions regarding research coverage,
In approving this proposal, however, we expect that FINRA will continue to monitor the effectiveness of the rule proposal, especially with regards to the treatment of research provided to institutional investors, and modify the rule should it prove to be unworkable or fail to provide an appropriate level of protection to investors.
For the reasons stated above, the Commission finds that the proposed rule change is consistent with the Act and the rules and regulations thereunder.
IT IS THEREFORE ORDERED, pursuant to section 19(b)(2) of the Act,
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the “Act”),
The proposed rule changes propose to amend the Exchange's rules related to its Automated Improvement Mechanism (“AIM”) and its Automated Improvement Mechanism (“AIM”) for Flexible Exchange Options (“FLEX Options”).
(additions are
Chicago Board Options Exchange, Incorporated Rules
Rule 6.74A Automated Improvement Mechanism (“AIM”)
Notwithstanding the provisions of Rule 6.74, a Trading Permit Holder that represents agency orders may electronically execute an order it represents as agent (“Agency Order”) against principal interest or against a solicited order provided it submits the Agency Order for electronic execution into the AIM auction (“Auction”) pursuant to this Rule.
(a)-(b) No change.
. . . Interpretations and Policies:
.01-.02 No change.
.03 Initially, and for at least a Pilot Period expiring on July 18, 201[5]
.04-.05 No change.
.06 Subparagraph (b)(2)(E) of this rule will be effective for a Pilot Period until July 18, 201[5]
.07-.08 No change.
Rule 24B.5A. FLEX Automated Improvement Mechanism
Notwithstanding the provisions of Rule 24B.5, a FLEX Trader that represents agency orders may electronically execute an order it represents as agent (“Agency Order”) against principal interest and/or against solicited orders provided it submits the Agency Order for execution into the automated improvement mechanism auction (“AIM Action”) pursuant to this Rule.
(a)-(b) No change.
This rule supersedes Exchange Rule 6.74A.
. . . Interpretations and Policies:
.01-.02 No change.
.03 Initially, and for at least a Pilot Period expiring on July 18, 201[5]
.04-.07 No change.
The text of the proposed rule change is also available on the Exchange's Web site (
In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements.
In February 2006, CBOE obtained approval from the Securities and Exchange Commission (the “Commission”) to adopt the AIM auction process.
The Commission approved two components of AIM on a pilot basis: (1) That there is no minimum size requirement for orders to be eligible for the auction; and (2) that the auction will conclude prematurely anytime there is a quote lock on the Exchange pursuant to
Nine one-year extensions to the pilot programs have previously become effective.
Additionally, in March 2012, CBOE obtained approval from the Commission to adopt the AIM auction process for FLEX Options.
The Commission approved on a pilot basis the component of AIM for FLEX Options that there is no minimum size requirement for orders to be eligible for the auction.
The Exchange believes the proposed rule change is consistent with the Securities Exchange Act of 1934 (the “Act”) and the rules and regulations thereunder applicable to the Exchange and, in particular, the requirements of Section 6(b) of the Act.
In particular, the proposed rule change protects investors and the public interest by allowing for an extension of the AIM and FLEX AIM pilot programs, and thus allowing additional time for the Commission to evaluate the pilot programs. The pilot programs will continue to allow (1) smaller non-FLEX option and FLEX Option orders to receive the opportunity for price improvement pursuant to the AIM auction, and (2) with respect to non-FLEX options, Agency Orders in AIM auctions that are concluded early because of quote lock on the Exchange to receive the benefit of the lock price. The additional data provided will help the Commission determine if there is evidence of meaningful competition for all size orders, significant price improvement for orders going through the AIM and FLEX AIM and an active and liquid market functioning on the Exchange outside of the AIM and FLEX AIM auctions.
CBOE does not believe that the proposed rule changes will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act. The Exchange does not believe the proposed rule changes impose any burden on intramarket competition because it applies to all Trading Permit Holders. All Trading Permit Holders that submit orders into an AIM or FLEX AIM auction are still subject to the same requirements. In addition, the Exchange does not believe the proposed rule changes will impose any burden on intermarket competition, as they merely extend the duration of an existing pilot programs, which are available to all market participants through Trading Permit Holders. AIM and FLEX AIM will continue to function in the same manner as they currently function for an extended period of time.
The Exchange neither solicited nor received comments on the proposed rule change.
Because the foregoing proposed rule change does not: (i) Significantly affect the protection of investors or the public interest; (ii) impose any significant burden on competition; and (iii) become operative for 30 days from the date on which it was filed, or such shorter time as the Commission may designate, it has become effective pursuant to Section 19(b)(3)(A) of the Act
A proposed rule change filed under Rule 19b-4(f)(6)
The Commission believes that waiving the 30-day operative delay is consistent with the protection of investors and the public interest, as it will allow the pilot programs to continue uninterrupted, thereby avoiding any potential investor confusion that could result from a temporary interruption in the pilot programs. Therefore, the Commission designates the proposed rule change to be operative on July 18, 2015.
At any time within 60 days of the filing of the proposed rule change, the Commission summarily may temporarily suspend such rule change if it appears to the Commission that such action is necessary or appropriate in the public interest, for the protection of investors, or otherwise in furtherance of the purposes of the Act.
Interested persons are invited to submit written data, views, and arguments concerning the foregoing, including whether the proposed rule change is consistent with the Act. Comments may be submitted by any of the following methods:
• Use the Commission's Internet comment form (
• Send an email to
• Send paper comments in triplicate to Secretary, Securities and Exchange Commission, 100 F Street NE., Washington, DC 20549-1090.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.
Federal Aviation Administration (FAA), DOT.
Request for public comment.
The Federal Aviation Administration is requesting public comment on a request by the Coastal Carolina Regional Airport to change the use of a portion of airport property at the Coastal Carolina Regional Airport. The request consists of approximately 11.7 acres for use as a future non-aeronautical development area. This action is taken under the provisions of Section 125 of the Wendell H. Ford Aviation Investment Reform Act for the 21st Century (AIR 21).
Comments must be received on or before
Documents are available for review at the Coastal Carolina Regional Airport, 200 Terminal Drive, New Bern, NC 28564; and the FAA Memphis Airports District Office, 2600 Thousand Oaks Boulevard, Suite 2250, Memphis, TN 38118-2482. Written comments on the Sponsor's request must be delivered or mailed to: Mr. Phillip J. Braden, Manager, Memphis Airports District Office, 2600 Thousand Oaks Boulevard, Suite 2250, Memphis, TN 38118-2482.
In addition, a copy of any comments submitted to the FAA must be mailed or delivered to Mr. Tom Braaten, Airport Director, Coastal Carolina Regional Airport Authority, 200 Terminal Drive, P.O. Box 3258, New Bern, NC 28564.
Mr. Michael L. Thompson, Program
The FAA proposes to rule and invites public comment on the request to change the designation of property currently reserved for aeronautical use to non-aeronautical use at Coastal Carolina Regional Airport, New Bern, NC 28564 under the provisions of AIR 21 (49 U.S.C. 47107(h)(2)).
On July 15, 2015, the FAA determined that the request to release property for non-aeronautical purposes at Coastal Carolina Regional Airport meets the procedural requirements of the Federal Aviation Administration. The FAA may approve the request, in whole or in part, no later than
The following is a brief overview of the request:
The Coastal Carolina Regional Airport is proposing to change the designation of property reserved for aeronautical use to a designation of non-aeronautical use to make the property available for future non-aeronautical development. This property consists of 11.7 acres along the Old Airport Road starting south of the current airport access road and extending approximately 1,200 feet south of that point. The airport is not proposing the sale of the property.
Any person may inspect, by appointment, the request in person at the FAA office listed above under
Federal Aviation Administration (FAA), DOT.
Notice of petition for exemption received.
This notice contains a summary of a petition seeking relief from specified requirements of Title 14, Code of Federal Regulations (14 CFR). The purpose of this notice is to improve the public's awareness of, and participation in, this aspect of the FAA's regulatory activities. Neither publication of this notice nor the inclusion or omission of information in the summary is intended to affect the legal status of the petition or its final disposition.
Comments on this petition must identify the petition docket number involved and must be received on or before August 11, 2015.
You may send comments identified by docket number FAA-2015-2021 using any of the following methods:
• Government-wide rulemaking Web site: Go to
• Mail: Send comments to the Docket Management Facility; U.S. Department of Transportation, 1200 New Jersey Avenue SE., West Building Ground Floor, Room W12-140, Washington, DC 20590.
• Fax: Fax comments to the Docket Management Facility at 202-493-2251.
• Hand Delivery: Bring comments to the Docket Management Facility in Room W12-140 of the West Building Ground Floor at 1200 New Jersey Avenue SE., Washington, DC, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays.
Mark Forseth, ANM-113, Federal Aviation Administration, 1601 Lind Avenue SW., Renton, WA 98057-3356, email
This notice is published pursuant to 14 CFR 11.85.
Federal Highway Administration (FHWA), DOT.
Notice and request for comments.
The FHWA invites public comments about our intention to request approval from the Office of Management and Budget (OMB) for a new information collection, which is summarized below under
Please submit comments by September 21, 2015.
You may submit comments identified by DOT Docket ID 2015-0019 by any of the following methods:
Nicole Katsikides, 202-366-6993, Office of Freight Management & Operations (HOFM-1), Office of Operations, Federal Highway Administration, Department of Transportation, 1200 New Jersey Avenue SE., Washington, DC 20590. Office hours are from 7:30 a.m. to 4:00 p.m., Monday through Friday, except Federal holidays.
The Paperwork Reduction Act of 1995; 44 U.S.C. Chapter 35, as amended; and 49 CFR 1.48.
Federal Transit Administration, DOT.
Notice of proposed Buy America waiver and request for comment.
The Federal Transit Administration (FTA) received a request for a waiver to permit the purchase of replacement gondola components that are non-compliant with Buy America requirements using FTA funding. The request is from the Colorado Department of Transportation on behalf of the Town of Mountain Village for its public transportation gondola system. In accordance with 49 U.S.C. 5323(j)(3)(A), FTA is providing notice of the waiver request and seeks public comment before deciding whether to grant the request. If granted, the waiver would apply only to FTA-funded procurements by Mountain Village necessary for the current gondola refurbishment projects described herein.
Comments must be received by August 5, 2015. Late-filed comments
Please submit your comments by one of the following means, identifying your submissions by docket number FTA-2015-0011:
1.
2.
3.
4.
Richard Wong, FTA Attorney-Advisor, at (202) 366-0675 or
The purpose of this notice is to provide notice and seek comment on whether the FTA should grant a non-availability waiver for Mountain Village's procurement of certain replacement gondola components for its public transportation gondola system.
With certain exceptions, FTA's Buy America requirements prevent FTA from obligating an amount that may be appropriated to carry out its program for a project unless “the steel, iron, and manufactured goods used in the project are produced in the United States.” 49 U.S.C. 5323(j)(1). A manufactured product is considered produced in the United States if: (1) all of the manufacturing processes for the product take place in the United States; and (2) all of the components of the product are of U.S. origin. A component is considered of U.S. origin if it is manufactured in the United States, regardless of the origin of its subcomponents. 49 CFR 661.5(d). If, however, FTA determines that “the steel, iron, and goods produced in the United States are not produced in a sufficient and reasonably available amount or are not of a satisfactory quality,” then FTA may issue a waiver (non-availability waiver). 49 U.S.C. 5323(j)(2)(B); 49 CFR 661.7(c).
The Town of Mountain Village provides free public transportation via gondola (also known as a tramway) between Mountain Village and the Town of Telluride. The gondola operates continuous fixed route service 17 hours per day, 7 days per week, 280 or more days per year, serving over 2,000,000 passengers per year. According to Mountain Village, the existing low-speed conveyor components (bearings, pulleys, tires and other related components) and gondola grip components (coil springs, movable jaws, fixed jaws, bearings, bolts, bushings, wheels and other related components) are nearing the end of their useful service lives and are showing signs of wear and fatigue. Without periodic capital equipment replacement/rebuild, the likelihood of mechanical downtime increases significantly, equating to prolonged service outages for commuters. Mountain Village also needs to refurbish the 59 gondola cabins due to wear and tear. Mountain Village intends to replace these gondola components over several phases during the coming years. Specifically, procurement of the low-speed conveyor components and the grips will be procured in two phases, one in 2015 and one in 2016; parts for the cabin refurbishment are anticipated to be procured over a six-year period. Any non-availability waiver granted would be effective for all phases of these projects, but would expire upon completion of these projects.
Mountain Village asserts that there are no companies that manufacture these gondola components in the United States and that each of the gondola components to be procured is only available from a single source, the original equipment manufacturers. The Colorado Passenger Tramway Safety Board (CPTSB) has agreed and concluded that, because gondolas are specialized and the market limited, there are no aftermarket manufacturers for these gondola components. CPTSB has concluded that, for these parts, there are no alternatives to the original equipment manufacturers, Dopplemayer and CWA, which do not manufacture the components in the United States. Although there is a new U.S. manufacturer for tramways in the United States, it does not produce detachable tramways like the one used by Mountain Village. In addition, parts for the remainder of the tramway are of a different design and cannot be used in other gondola systems.
The purpose of this notice is to publish the Colorado Department of Transportation request, made on behalf of Mountain Village, and seek public comment from all interested parties in accordance with 49 U.S.C. 5323(j)(3)(A). Comments will help FTA understand completely the facts surrounding the request, including the effects of a potential waiver and the merits of the request. A full copy of the request has been placed in docket number FTA-2015-0011.
Federal Transit Administration, DOT.
Notice of proposed Buy America waiver and request for comment.
The Federal Transit Administration (FTA) received a request for a waiver to permit the purchase of a Variable Refrigerant Flow (VRF) HVAC system that is non-compliant with Buy America requirements using FTA funding. The request is from the City of Kansas City, Missouri (Kansas City) for its Vehicle Maintenance Facility (VMF) associated with the Kansas City Downtown Streetcar Project. In accordance with 49 U.S.C. 5323(j)(3)(A), FTA is providing notice of the waiver request and seeks public comment before deciding whether to grant the request. If granted, the waiver would apply only to the FTA-funded procurement of a VRF HVAC system by Kansas City.
Comments must be received by August 5, 2015. Late-filed comments will be considered to the extent practicable.
Please submit your comments by one of the following means, identifying your submissions by docket number FTA-2014-0021:
1.
2.
3.
4.
Richard L. Wong, FTA Attorney-Advisor, at (202) 366-4011 or
FTA seeks comment on whether it should grant a non-availability waiver for the Kansas City procurement of a VRF HVAC system for its VMF associated with the Kansas City Downtown Streetcar Project, using FTA grant funding.
With certain exceptions, FTA's Buy America requirements prevent FTA from obligating an amount that may be appropriated to carry out its program for a project unless “the steel, iron, and manufactured goods used in the project are produced in the United States.” 49 U.S.C. 5323(j)(1). A manufactured product is considered produced in the United States if: (1) All of the manufacturing processes for the product must take place in the United States; and (2) all of the components of the product must be of U.S. origin. A component is considered of U.S. origin if it is manufactured in the United States, regardless of the origin of its subcomponents. 49 CFR 661.5(d). If, however, FTA determines that “the steel, iron, and goods produced in the United States are not produced in a sufficient and reasonably available amount or are not of a satisfactory quality,” then FTA may issue a waiver (non-availability waiver). 49 U.S.C. 5323(j)(2)(B); 49 CFR 661.7(c).
Kansas City is requesting a non-availability waiver for its procurement of a VRF HVAC system that will be installed in a VMF in Kansas City, Missouri, that will service its street cars. This facility is being built to U.S. Green Building Council (USGBC) Leadership in Energy and Environmental Design (LEED) standards and will incorporate a number of sustainable and energy efficient elements. One of those elements is a VRF HVAC system that, among other things, is space saving, has invertor technology, efficiency, and a non-ozone depleting refrigerant that domestic manufacturers of HVAC systems do not provide. According to Kansas City, its contractor was directed to evaluate the substitution of a Buy America-compliant Variable Air Volume (VAV) system, but the contractor advised Kansas City that the VAV system would endanger the project's LEED Gold certification because of the difference in efficiency between the VAV and VRF HVAC systems. In addition, the substitution of a VAV system would require significant changes to the project, such as the alteration of already-erected structural elements that were designed to accommodate a VRF system and additional design changes and plan reviews by Kansas City.
Kansas City points to two recent non-availability waivers FTA issued to the San Bernardino Associated Governments (79 FR 61129, October 9, 2014) and Rock Island County Metropolitan Mass Transit District for a similar VRF system (79 FR 34653, June 17, 2014), as well as to a blanket non-availability waiver issued by the U.S. Department of Energy (DOE) in 2010 for VRF HVAC systems procured with American Reinvestment and Recovery Act funding (75 FR 35447, June 22, 2010). According to Kansas City, the U.S. DOE's determination of non-availability and FTA's recent waivers, as well as their own contractor's research, indicate that this product is not manufactured domestically. Finally, FTA, in collaboration with the National Institute of Standards and Technology's Hollings Manufacturing Extension Partnership, conducted a nationwide search to determine if any company currently manufactures a compatible VRF system that complies with Buy-America. The search revealed that no company currently can provide a Buy-America compliant VRF system that meets Kansas City's specifications.
The purpose of this notice is to publish Kansas City's request and to seek public comment from all interested parties in accordance with 49 U.S.C. 5323(j)(3)(A). Comments will help FTA understand completely the facts surrounding the request, including the effects of a potential waiver and the merits of the request. A full copy of the request has been placed in docket number FTA-2015-0010.
National Highway Traffic Safety Administration (NHTSA), DOT.
Notice and request for comment on renewal of a previously approved information collection.
In compliance with the Paperwork Reduction Act of 1995 (44 U.S.C. 3501
Comments must be submitted on or before August 21, 2015.
Michael Pyne, Office of Crash Avoidance Standards (NVS-123), National Highway Traffic Safety Administration, W43-457, 1200 New Jersey Avenue SE., Washington, DC 20590. Mr. Pyne can be reached at (202) 366-4171.
Although lift installation instructions are considerably more than one page, lift manufacturers already provide lift installation instructions in the normal course of business and one additional page should be adequate to allow the inclusion of FMVSS-specific information.
Total estimated annual cost = $9,315.32.
Total estimated hour burden per year = 192 hours.
Comments are invited on: Whether the proposed collection of information is necessary for the proper performance of the functions of the Department, including whether the information will have practical utility; the accuracy of the Department's estimate of the burden of the proposed information collection; ways to enhance the quality, utility and clarity of the information to be collected; and ways to minimize the burden of the collection of information on respondents, including the use of automated collection techniques or other forms of information technology.
The Paperwork Reduction Act of 1995; 44 U.S.C. chapter 35, as amended; and 49 CFR 1:48.
Office of the Comptroller of the Currency (OCC), Treasury.
Notice and request for comment.
The OCC, the Board of Governor of the Federal Reserve System (Board), the Federal Deposit Insurance Corporation (FDIC), and the National Credit Union Administration (NCUA) (collectively, the Agencies), as part of their continuing effort to reduce paperwork and respondent burden, invite the general public and other Federal agencies to take this opportunity to comment on a continuing information collection, as required by the Paperwork Reduction Act of 1995 (PRA).
In accordance with the requirements of the PRA, the Agencies may not conduct or sponsor, and the respondent is not required to respond to, an information collection unless it displays a currently valid Office of Management and Budget (OMB) control number.
The OCC is soliciting comment on behalf of the Agencies concerning renewal of the information collection titled, “FFIEC Cybersecurity Assessment Tool.”
Comments must be received by September 21, 2015.
Because paper mail in the Washington, DC area and at the OCC is subject to delay, commenters are encouraged to submit comments by email, if possible. Comments may be sent to: Legislative and Regulatory Activities Division, Office of the Comptroller of the Currency, Attention: 1557-0328, 400 7th Street SW., Suite 3E-218, Mail Stop 9W-11, Washington, DC 20219. In addition, comments may be sent by fax to (571) 465-4326 or by electronic mail to
All comments received, including attachments and other supporting
Shaquita Merritt, OCC Clearance Officer, or Beth Knickerbocker, Counsel (202) 649-5490, for persons who are deaf or hard of hearing, TTY, (202) 649-5597, Legislative and Regulatory Activities Division, Office of the Comptroller of the Currency, 400 7th Street SW., Suite 3E-218, Mail Stop 9W-11, Washington, DC 20219.
Under the PRA (44 U.S.C. 3501-3520), Federal agencies must obtain approval from OMB for each collection of information they conduct or sponsor. “Collection of information” is defined in 44 U.S.C. 3502(3) and 5 CFR 1320.3(c) to include agency requests or requirements that members of the public submit reports, keep records, or provide information to a third party. The definition contained in 5 CFR 1320.3(c) also includes a voluntary collection. Section 3506(c)(2)(A) of the PRA (44 U.S.C. 3506(c)(2)(A)) requires Federal agencies to provide a 60-day notice in the
In connection with issuance of the assessment entitled “FFIEC Cybersecurity Assessment Tool,”
For this reason, the Agencies, under the auspices of the Federal Financial Institutions Examination Council (“FFIEC”), have accelerated efforts to assess and enhance the state of the financial industry's cyber preparedness and to close gaps in the Agencies' examination procedures and training that can strengthen the oversight of financial industry cybersecurity readiness. The Agencies also have focused on improving their abilities to provide financial institutions with resources that can assist in protecting institutions and their customers from the growing risk posed by cyber attacks.
As part of these increased efforts, the Agencies have developed a Cybersecurity Assessment Tool (“Assessment”) that will assist financial institutions of all sizes in assessing their inherent cybersecurity risks and their risk management capabilities. The Assessment will allow a financial institution to identify its inherent cyber risk profile based on the financial institution's technologies and connection types, delivery channels, online/mobile products and technology services it offers, organizational characteristics, and threats it is likely to face. Once an institution identifies its inherent cyber risk profile, it will be able to use the Assessment's maturity matrix to evaluate its level of cybersecurity preparedness based on the institution's cyber risk management and oversight, threat intelligence capabilities, cybersecurity controls, external dependency management, and cyber incident management and resiliency planning. A financial institution can use the matrix's maturity levels to identify opportunities for improving the institution's cybersecurity, based on its inherent risk profile. The Assessment also will enable a financial institution to identify areas more rapidly that could improve its cybersecurity risk management and response programs, if needed. Use of the Assessment by financial institutions is not mandatory.
Estimated Burden per Response: 80 hours.
Total Estimated Burden: 120,880 hours.
Estimated Burden per Response: 80 hours.
Total Estimated Burden: 422,560.
Estimated Burden per Response: 80 hours.
Total Estimated Burden: 326,720.
Estimated Burden per Response: 80 hours.
Total Estimated Burden: 496,480.
Estimated Number of Respondents: 176 technology service providers.
Estimated Burden per Response: 80 hours.
Total Estimated Burden: 14,080 hours.
Comments submitted in response to this notice will be summarized and included in the request for OMB approval. All comments will become a matter of public record. Comments are invited on:
(a) Whether the collection of information is necessary for the proper performance of the functions of the Agencies, including whether the information has practical utility;
(b) The accuracy of the Agencies' estimates of the burden of the collection of information;
(c) Ways to enhance the quality, utility, and clarity of the information to be collected;
(d) Ways to minimize the burden of the collection on respondents, including through the use of automated collection techniques or other forms of information technology; and
(e) Estimates of capital or start-up costs and costs of operation, maintenance, and purchase of services to provide information.
Departmental Offices, U.S. Department of the Treasury.
Notice of open meeting.
This notice announces that the Department of the Treasury's Federal Advisory Committee on Insurance (“Committee”) will convene a meeting on Thursday, August 6, 2015, in the Cash Room, 1500 Pennsylvania Avenue NW., Washington, DC 20220, from 1:00-5:00 p.m. Eastern Time. The meeting is open to the public, and the site is accessible to individuals with disabilities.
The meeting will be held on Thursday, August 6, 2015, from 1:00-5:00 p.m. Eastern Time.
The Federal Advisory Committee on Insurance meeting will be held in the Cash Room, Department of the Treasury, 1500 Pennsylvania Avenue NW., Washington, DC 20220. The meeting will be open to the public. Because the meeting will be held in a secured facility, members of the public who plan to attend the meeting must either:
1. Register online. Attendees may visit
Online registration will close at 5:00 p.m. Eastern Time on Friday, July 31, 2015.
2. Contact the Federal Insurance Office (FIO), at (202) 622-5892, by 5:00 p.m. Eastern Time on Friday, July 31, 2015, and provide registration information.
Requests for reasonable accommodations under Section 504 of the Rehabilitation Act should be directed to Marcia Wilson, Office of Civil Rights and Diversity, Department of the Treasury at (202) 622-8177, or
Brett D. Hewitt, Policy Advisor, FIO, Room 1410, Department of the Treasury, 1500 Pennsylvania Avenue NW., Washington, DC 20220, at (202) 622-5892 (this is not a toll-free number). Persons who have difficulty hearing or speaking may access this number via TTY by calling the toll-free Federal Relay Service at (800) 877-8339.
Notice of this meeting is provided in accordance with the Federal Advisory Committee Act, 5 U.S.C. App. II, 10(a)(2), through implementing regulations at 41 CFR 102-3.150.
• Send electronic comments to
• Send paper statements in triplicate to the Federal Advisory Committee on Insurance, Room 1410, Department of the Treasury, 1500 Pennsylvania Avenue NW., Washington, DC 20220.
In general, the Department of the Treasury will post all statements on its Web site
Office of the Under Secretary of Defense for Personnel and Readiness, Department of Defense.
Final rule.
The Department of Defense (“Department”) amends its regulation that implements the Military Lending Act, herein referred to as the “MLA.” Among other protections for Service members and their families, the MLA limits the amount of interest that a creditor may charge on “consumer credit” to a maximum annual percentage rate of 36 percent. The Department amends its regulation primarily for the purpose of extending the protections of the MLA to a broader range of closed-end and open-end credit products. Among other amendments, the Department modifies the provisions relating to the optional mechanism a creditor could use when assessing whether a consumer is a “covered borrower,” modifies the disclosures that a creditor must provide to a covered borrower, and implements the enforcement provisions of the MLA.
Marcus Beauregard, 571-372-5357.
In September 2014, the Department published a proposal to amend its regulation implementing the MLA
The Department believes that this final rule is appropriate in order to address a wider range of credit products that currently fall outside the scope of the Department's existing regulation that, until now, had implemented the MLA (“existing rule”). In addition, the final rule streamlines the information that a creditor must provide to a covered borrower when consummating a transaction involving consumer credit and provides a more straightforward mechanism for a creditor to conclusively determine—via a safe harbor—whether a consumer-applicant is a covered borrower. In this regard, the Department is aware of misuses of the covered borrower identification statement whereby a Service member (or covered dependent) falsely declares that he or she is not a covered borrower. The Department believes that, if a creditor elects to (but is not required to) unilaterally conduct a covered-borrower check by obtaining information from the Department's online database (“MLA Database”),
The Department is provided authority in 10 U.S.C. 987(h) to establish regulations to implement the MLA. As described in 10 U.S.C. 987(h)(3) the Department, at a minimum, must consult with other Federal agencies “not less often than once every two years” with a view towards revising the regulation implementing the MLA. In developing this final rule the Department has consulted with the Board of Governors of the Federal Reserve System (“Board”), the Consumer Financial Protection Bureau (“Bureau”), the Department of the Treasury, the Federal Deposit Insurance Corporation (“FDIC”), the Federal Trade Commission (“FTC”), the National Credit Union Administration (“NCUA”), and the Office of the Comptroller of the Currency (collectively, “Federal Agencies”). The Department will continue to consult with the Federal Agencies, as appropriate, as the Department continues to assess the measures implementing the protections of the MLA.
The MLA, as implemented by the Department's regulation, provides two broad classes of requirements applicable to a creditor: First, the creditor may not impose a Military Annual Percentage Rate (“MAPR”) greater than 36 percent in connection with an extension of consumer credit to a covered borrower (“interest-rate limit”); second, when extending consumer credit, the creditor must satisfy certain other terms and conditions, such as providing certain information (
Key elements of the Department's rule, particularly relative to the Proposed Rule, include:
• Providing a temporary exemption for credit extended in a credit card account under an open-end (not home-secured) consumer credit plan. The exemption for a credit card account expires, at minimum, in October 2017, and the rule permits that exemption to be extended for up to one year;
• Providing a qualified exclusion from the requirements relating to the computation of the MAPR for a credit card account for a “bona fide” fee, but eliminating the proposed condition that the bona fide fee be “customary.” Under the final rule, an application fee, participation fee, transaction-based fee, or similar fee (other than a periodic rate) for a charge may be excluded from the MAPR to the extent that the fee is (i) a bona fide fee and (ii) reasonable for that type of fee; and
• Permitting a creditor, until October 3, 2016, to continue to use the method described in the existing rule for conducting a covered-borrower check, which involves the use of a covered borrower identification statement, as a safe harbor for compliance. After October 3, 2016, a creditor seeking a safe harbor for compliance with the rule may elect to use either of the new methods for conducting a covered-borrower check (and keep a record accordingly) set forth in § 232.5(b).
Many comments on the Proposed Rule state that, if the Department were to adopt a final rule along the lines of the Proposed Rule, creditors would need a substantial period of time to modify their operations in order to comply with the rule. For example, in a joint letter, the American Bankers Association, the Association of Military Banks of America, the Consumer Bankers Association, the Independent Community Bankers of America, and the National Association of Federal Credit Unions (the “Associations”) state: “Given the breadth, complexity, and broad reach of the proposal, the necessary legal analysis operations, systems changes, staff training, [and] the draconian consequences for violations, . . . the Department should allow [creditors] at least 18 months to comply” with a final rule.
Because the protections of the MLA will apply to a wider range of credit products—and thus the requirements of the final rule will apply to broader classes of creditors—the Department believes that a creditor should be afforded a reasonable period of time to adjust its operations and, if necessary, the terms and conditions of its loan product(s) offered to covered borrowers in order to comply with the final rule. Accordingly, under § 232.13(a), a creditor must comply with the requirements of the rule with respect to a consumer credit transaction or account for consumer credit consummated or established on or after October 3, 2016.
Consistent with the Department's determination that a creditor should be afforded a 12-month period to adjust its operations and loan product(s) to comply with the rule, a creditor also is permitted to use the existing safe harbor when assessing whether a consumer-applicant is a covered borrower. If a creditor uses the safe harbor set forth in § 232.5(a) of the Department's existing rule, the creditor would be subject to the existing interpretation regarding the treatment of a covered borrower which is designed to prevent the creditor from using the borrower's declaration to allow the borrower to waive his or her rights to the protections provided under the MLA.
Upon the compliance date, the rule permits—and does not require—a creditor to use information obtained from the MLA Database or information contained in a consumer report obtained from a nationwide consumer reporting agency in order to conclusively determine whether a consumer-applicant is a covered borrower. A creditor who uses one (or both) of the methods set forth in, and complies with the recordkeeping requirements of, § 232.5(b) when conducting a covered-borrower check will be afforded the new safe harbor.
The Department concludes that consumer credit should not include credit extended in a credit card account under an open-end (not home-secured) consumer credit plan until October 3, 2017. Section 232.13(c)(2) allows the Secretary (or an official of the Department duly authorized by the Secretary) to extend, up to an additional year, the expiration of the exemption for a credit card account. Thus, until October 3, 2017 (or potentially a longer period of time), the requirements relating to the computation of the MAPR for a credit card account, as set forth in § 232.4, would not apply. When the exemption expires, the conditional exemption for any “bona fide” fee charged to a credit card account, as set forth in § 232.4(d) would apply.
Several hundred comments from a wide range of persons—including thousands of individuals—have submitted comments on the Proposed Rule. Including comments on form letters and petitions, over 21,000 individuals express views on the Proposed Rule,
Nearly two hundred consumer or civil rights organizations have submitted comments, and most express support for the reforms in the Proposed Rule. In addition, some organizations representing consumers believe that the Department should adopt a regulation that extends the protections of the MLA to credit extended in overdraft services, as well as to rent-to-own products.
Forty U.S. Senators express support for the Department to adopt the proposed definition of “consumer credit,” particularly in order to close what they find to be “loopholes” in the existing rule that preclude Service members and their families from effectively receiving the protections of the MLA.
Over 350 groups, trade associations, and businesses have submitted comments, and many of these businesses and their representatives express concerns with—as well as outright opposition to—the Proposed Rule.
Most financial institutions, through approximately 50 comments, urge the Department to adopt in the final rule an exemption for certain types of creditors or, more narrowly, one or more exemptions for certain types of credit products. In particular, insured depository institutions and insured credit unions believe that, if the Department extends the scope of “consumer credit,” then the Department also should craft that definition so that an extension of credit from an insured depository institution or insured credit
Apart from banks and credit unions, several finance companies and their representatives express the view that the Proposed Rule, if adopted, would reduce access to a wide range of installment loans, which these commenters contend are valuable resources for Service members and their families. Some of these comments state that the four relief societies for the military services (Army Emergency Relief, Navy-Marine Corps Relief Society, Air Force Aid Society and Coast Guard Mutual Assistance) (collectively, the “Relief Societies”) currently have limited scope of service and resources, insufficient to handle the range and volume of loans needed by Service members and their families; extending the Department's rule to cover a wider range of installment loans, these comments contend, would restrict access to these products for covered borrowers.
Pawnbrokers and their representatives explain that traditional pawn transactions are different in kind from other types of credit transactions, principally because a pawn transaction typically is a non-recourse loan,
In its proposal, the Department posed a series of questions in order to facilitate comments and, in particular, encourage interested persons to provide detailed information about the potential effects if the Department were to adopt the Proposed Rule. Some commenters offer certain data regarding the potential costs and benefits that might emerge if the Proposed Rule were to be implemented; in assessing the potential effects of the final rule, the Department has incorporated that data, as appropriate.
The Department has quantified three effects of the regulation. With respect to costs, the Department anticipates that, absent any relief under § 232.13(c), its regulation might impose costs of approximately $106 million during the first year, as creditors adapt their systems to comply with the requirements of the MLA and the Department's regulation. When the relief afforded to creditors for the general exemption for credit card accounts is included, then the anticipated approximate costs would be significantly lower during the first year. After the first year and on an ongoing basis, in a sensitivity analysis, the annual benefits to the Department may be between approximately $14 to $133 million. The Department estimates the potential savings that could result if the rule reduces the involuntary separations of Service members where financial distress is a contributing factor in sensitivity analyses; at some points in the range of estimates the Department has used to assess the proposal, these savings are estimated to exceed the compliance costs that would be borne by creditors. The Department also has developed a transfer payment analysis that estimates between $100 and $119 in transfer payments per year from creditors to service members and their dependents. In addition to these quantified effects, the Department examined some effects qualitatively including those effects listed in figure 2 within section V.A.
The Department is amending its regulation that implements 10 U.S.C. 987, which was enacted in section 670 of the John Warner National Defense Authorization Act for Fiscal Year 2007 (“2006 Act”),
The 2013 Act amended several provisions of 10 U.S.C. 987. In particular, the 2013 Act added provisions that would permit a covered borrower to recover damages from a creditor who violates a requirement of
In August 2007, the Department published its regulation to implement the MLA.
In September 2014, the Department published a proposal to amend the existing rule primarily for the purpose of extending the protections of 10 U.S.C. 987 to a broader range of closed-end and open-end credit products. In describing the Proposed Rule, the Department explained, in relevant part, that “the narrowly defined parameters of the credit products regulated as `consumer credit' under [the then-existing rule] do not effectively provide the protections intended to be afforded to Service members and their families under the MLA.”
Many persons and entities believe that the Department should not amend its regulation as proposed because the expansion of the definition of “consumer credit” and the attendant requirements under the MLA would impair the ability of many types of creditors, particularly insured depository institutions and insured credit unions, to provide short-term credit to Service members and their families. However, some commenters argue that the Department should amend its regulation to apply to a broader range of credit products, including open-end credit, provided that the regulation also includes an exemption for insured depository institutions and insured credit unions.
In the process of adopting this final rule, the Department has reviewed the comments on the Proposed Rule and consulted with the Federal Agencies on a wide range of issues implicated by the Proposed Rule. In light of its assessment of the comments, its experience observing the effects of its existing regulation, and the scope and purposes of the provisions of 10 U.S.C. 987, the Department has determined that a wider range of credit products offered or extended to covered borrowers should be subject to the protections of the MLA. As proposed, the Department is amending its regulation so that, in general, consumer credit covered under the MLA
The Department has considered whether unqualified exclusions from the MAPR for certain types of fees, such as an application fee or participation fee, should be adopted for credit card accounts in order to preserve current levels of access to those products for Service members and their dependents; however, the Department believes that unqualified exclusions from the MAPR for certain fees, or all non-periodic fees, could be exploited by a creditor who would be allowed to preserve a high-cost, open-end credit product by offering a relatively lower periodic rate coupled with an application fee, participation fee, or other fee (as described in the exclusion), subject to the restrictions under the amendments to TILA enacted in the Credit Card Accountability Responsibility and Disclosure Act of 2009 (“CARD Act”).
However, the Department also adopts the provisions in the Proposed Rule, with certain modifications, that provide a broad exclusion to allow a creditor who offers consumer credit through a credit card account to exclude from the MAPR any “bona fide” fee (other than a periodic rate). Under the final rule, that creditor would need to confirm that its fees are bona fide and reasonable, and if so, the Department believes that the creditor should be able to continue to offer the same credit card product(s) to covered borrowers by making certain adjustments to the terms and conditions for the product(s) by, for example, including the “statement of the MAPR” (which would be permitted simply to be added to its credit card agreement(s), and which is not required to be provided in any advertisement),
The Department has considered whether to provide a complete exemption from the definition of consumer credit for certain types of loans, such as a “payday alternative loan” (“PAL”) offered by a federal credit union and regulated under the NCUA's regulation
As discussed in section III.D., the Department declines to provide a complete exemption for a PAL and,
The Department adopts in the final rule provisions designed to provide a creditor with a more straightforward mechanism to assist in assessing the status of a consumer as a covered borrower so that the creditor may have “some degree of certainty in determining that the loans [the creditor makes] are in compliance with [the MLA] as implemented by Part 232.”
As the Department stated when issuing the Proposed Rule, the Department makes a significant investment in recruiting, training and retaining highly qualified Service members. The Department expects these Service members to maintain personal readiness standards, including paying their debts and maintaining their ability to attend to the financial needs of their families.
As young people with steady pay checks and personal responsibilities which emerge earlier than their contemporaries, junior enlisted Service members need to have a commensurate level of financial acumen and maturity to succeed. Junior enlisted Service members are generally high school graduates who may have started college.
The Department has established policy requiring Service members to receive financial education throughout their military careers, commencing with an initial course provided within 3 months of having arrived at their first duty station. As Service members assume supervision of others, they are also provided information on policies and practices designed to protect junior military members.
Department policy also requires the military services to provide one-on-one counseling to help a Service member determine appropriate short- and long-term actions to alleviate debt and achieve financial goals. The military services employ at least one certified financial counselor (civil service or contractor) at each military installation and have developed Military Service-specific programs to extend counseling into the military units through designated approved financial educators. For example, the Department of the Navy directs Navy and Marine Corps units to designate and train a Command Financial Specialist (E6 or above) who delivers financial education, conducts basic counseling and makes referrals to certified counselors. The military services reported 1,828,299 brief counseling contacts and 161,992 extended counseling contacts for Fiscal Year 2012.
To provide monetary support to Service members and their families with financial hardships, the military services have partnered with nonprofit charitable organizations chartered to provide relief services to Service members and their families. The four Relief Societies provide no-interest loans, grants, and scholarships, and fund other support programs for active-duty military communities. Each of these Relief Societies traditionally has provided no-interest loans and grants for shortfalls in household expenses (
The Department continues to believe that, consistent with the MLA, there may be a need to limit access to high-cost borrowing, even with the Department's emphasis on delivering messages to save and control debt, education to support managing finances wisely, counseling resources to aid Service members, and financial resources to help Service members cover unforeseen shortfalls and emergencies. Additionally, as messaging and education programs make clear, the Department expects Service members to seek out assistance rather than continue attempting by themselves to manage high-cost debt.
The majority of Service members have access to reasonably priced (as well as low-cost) credit, and, as long as they wisely use those resources, they are likely not to need high-cost loans to fulfill their credit needs. In particular, the military services have partnered with nonprofit charitable organizations chartered to provide relief services to Service members and their families so that Service members and their families can obtain monetary support for their financial hardships. The Relief Societies provide no-interest loans and grants for shortfalls in household expenses (
Section 661 of the 2013 Act amended the MLA to require the Department to consult—“not less often than once every two years”—with the Federal Agencies. Consistent with this provision of the MLA and with Executive Order 13563 (“EO 13563”),
As proposed, the Department has determined to revise the scope of the definition of “consumer credit” to be generally consistent with the credit
The Department believes that the narrow parameters of the credit products defined as “consumer credit” under the existing rule do not effectively provide the protections intended to be afforded to Service members and their families under the MLA. As forty U.S. Senators observe, extending the scope of “consumer credit” to track the credit regulated under Regulation Z closes “existing MLA loopholes” and “[t]his comprehensive approach is essential to preventing future evasions” of the requirements of the MLA.
Commenters urge the Department to modify certain aspects of the Proposed Rule in light of certain provisions relating to the scope of consumer credit and the charges included in the MAPR that do not track the terms and conditions of Regulation Z. As discussed in section IV., the Department declines to adopt provisions that would allow any fee for a voluntarily agreed to credit insurance product, debt cancellation contract, or debt suspension agreement to be excluded from the MAPR.
Many persons and entities urge the Department not to revise the scope of “consumer credit” as described in the Proposed Rule. For example, one commenter that generally “applaud[s] the proposal and support[s] the expansion of the definitions of the credit products that fall under the [Proposed Rule]” nonetheless cautions that “the proposed changes [to the regulation] would mean that the cost of providing small dollar loans will be more than can be recovered in fees and interest.”
Other persons and entities similarly urge the Department not to adopt the approach of the Proposed Rule because, they contend, 10 U.S.C. 987 is intended solely to address so-called “predatory” loan products. For example, a comment on behalf of certain credit card issuers asserts that the “regulatory framework [under the MLA] . . . was developed by the [Department] for application only to specific types of closed-end products,” and the comment contends that, in adopting the rule in 2007, the Department had established or endorsed certain “criteria for evaluating whether credit products pose risks to [Service] members.”
Even though the Department's initial proposal, issued in April 2007,
In explaining the bases and rationale for redefining consumer credit in the Proposed Rule, the Department observed that “certain payday loans, vehicle title loans, and refund anticipation loans present the
“[T]he Department recognizes that there is a need for small-dollar credit, while at the same time being concerned that the current regulation implementing the MLA does not protect covered borrowers from high-cost credit products.
“AFSA agrees with the Department that Service members and their families should have access to safe and responsible credit. We understand the Department's concern that high-cost loans can pose risks to Service members and their families.
“The Department's proposed approach, though, does not meet these two goals. It seems that the Department is willing to prevent covered borrowers from accessing much needed, good, small-dollar credit options by rewriting the rules with a broad brush stroke that assumes that all products are undesirable.”).
The MLA grants the Department various authorities to prescribe regulations to carry out the law and broad latitude to determine the scope, terms, and conditions of the regulations. The Department is empowered to define the scope of the regulations through, first, a broad grant of authority to define “consumer credit” and the type(s) of “creditor”
In light of the scope of the Proposed Rule, the Department asked whether consideration should be given for a limited or complete exemption for an insured depository institution or insured credit union.
One credit union argues:
Simply stated, there is a critical and growing need for short-term credit among our military and the working class families that make up the majority of [the credit union's] constituents. . . . [T]he reality is that over 40% of [the credit union's] military members survive on less than $30,000 per year. They have financial emergencies. An unexpected illness, an emergency vehicle repair, or a loss of income in the family often strikes at the worst possible time. Yet, most have no ability to qualify for a traditional loan or credit card due to poor and insufficient credit history. In order to make ends meet, short term credit is the only option. And when there is demand the market will provide an outlet to satisfy that demand. The question for the [Department] then is what market is most appropriate to address this demand. Payday lenders that have shown time and again the ability to circumvent any regulatory attempt to control their lending practices and cap excessive finance charges? Or highly regulated not-for-profit cooperatives that are controlled by the very same members we serve? The [Proposed Rule] makes no distinction between the various players in the market and therefore must not be enacted.
This credit union argues that if the Proposed Rule were to be implemented, covered borrowers who “require short term credit . . . will lose access to the one sector of the financial industry that places consumer fairness at the core of its mission: credit unions.”
The Department rejects the view that in considering whether to extend the scope of consumer credit to generally track the credit that is subject to Regulation Z the Department must choose between allowing Service members and their families to obtain credit products and services from insured depository institutions and insured credit unions or shutting them out from access to those institutions. The Department is confident that an insured depository institution or insured credit union that places the fair treatment of its consumers at the core of its mission still could find appropriate methods to provide to covered borrowers credit products that comply with the interest-rate limit and other requirements of 10 U.S.C. 987.
Other comments support providing an exemption for an insured depository institution or insured credit union based on the current framework of regulating these entities. A comment on behalf of certain credit card issuers, for example, contends that “the existing robust regulatory and supervisory framework that applies to federally-supervised depository institutions provides a strong basis for exempting such institutions from the scope of the MLA regulations.”
The Department recognizes that the regulation and supervision of an insured depository institution or insured credit union could be among the criteria that the Department, in its discretion, may apply in defining a “creditor”
The 2013 Act amended 10 U.S.C. 987 to grant enforcement authority to certain agencies (as specified in section 108 of TILA),
Supervision to assess whether a financial institution complies with safety-and-soundness principles or mandates, or even with consumer protection requirements, is designed largely for other purposes, and not directly aimed to lower the costs of credit to covered borrowers in the manner that 10 U.S.C. 987 is expressly designed to do. In light of the terms and structure of 10 U.S.C. 987, as well as the Department's review of the comments submitted on the Proposed Rule, the Department finds, at this time, that there is no adequately strong connection between the supervision of an insured depository institution or insured credit union and restrictions on costs of consumer credit to warrant an exemption from the definition of “creditor” for either type of institution.
Nevertheless, supervision to assess compliance by an insured depository institution or insured credit union with safety-and-soundness principles or requirements (or other applicable laws) could provide meaningful benefits to borrowers that are the object of the protections of the MLA.
Many commenters urge the Department to modify the definition of consumer credit set forth in the Proposed Rule to accommodate schemes that many financial institutions use involving a fixed fee, commonly an `application' or `processing' fee, plus an interest-rate charge. As one commenter explains:
The ability to offer small-dollar loans, open or closed-end, most often requires assessing a fixed fee in conjunction with higher interest rates to recover costs. As an example, an application fee is charged to offset underwriting requirements, which include accessing credit bureaus, decision processing (automated or manual), and regulatory notifications, for an approved or denied loan. . . . This balance between fixed fee and reduced interest earnings allows a banking institution to recover its costs and continue its small-dollar lending. It must be noted that the above example is illustrative of how banking institutions recover costs, not generate significant income, from small-dollar lending.
The Department has no occasion to dispute this account of how financial institutions could structure credit products, particularly small-dollar loans, to borrowers. Similarly to the way that a saver uses separate envelopes to allocate cash for different purposes (
The Department remains concerned that if an application fee or participation fee were to be excluded from the elements that must be included in the calculation of the MAPR (under § 232.4(c))—the principal basis of the NCUA's argument to provide an exclusion for a PAL made in accordance with its regulation
The Department observes that 10 U.S.C. 987(b) and the provisions that define “annual percentage rate” and “interest” which are integral to that interest-rate limit, taken together, are designed to thwart high cost lending to Service members and their families—not solely loan products that carry the very highest costs. Accordingly, and consistent with its authorities to prescribe “consumer credit” and the method for computing the MAPR of “interest,” the Department concludes that, in general, an application fee charged to a covered borrower must be accounted for when computing the MAPR.
The NCUA states (and many credit unions share the NCUA's view) that a PAL structured in accordance with the NCUA's regulation
Even though the Department has determined that an application fee fits within the (ambiguous, but broad) definitions of “interest” and “annual percentage rate” in the MLA, the Department also recognizes that the FCU Act establishes an express restriction on the amount of interest that a federal credit union may charge to a member-consumer,
After review of comments on the Proposed Rule—including those contending that PALs are necessary forms of short-term, small-dollar loans (complete with the charge of an application fee) for covered borrowers
Consistent with the Department's policy to implement the requirements of the MLA in a manner that affords comity with other federal laws that expressly limit the interest rate of credit products that may be provided to covered borrowers, the Department adopts the exclusion in § 232.4(c)(1)(iii)(B) to apply to the FCU Act and to other similar federal laws that apply to insured depository institutions. In particular, the exclusion would apply to a closed-end loan that is “[s]ubject to and made in accordance with a Federal law (other than the [MLA]) that expressly limits the interest rate or cost that a Federal credit union or an insured depository institution may charge on an extension of credit.”
At this time, the Department has crafted the exclusion in § 232.4(c)(1)(iii)(B) only with respect to a closed-end loan subject to a “Federal law (other than 10 U.S.C. 987) that expressly limits the rate of interest”
The exclusion from the elements required to be included when computing the MAPR applies to an application fee charged when making a “short-term, small amount loan,” defined in § 232.3(t). As a matter of deference to FCU Act and the NCUA's authorities under that Act, this new term is designed to contain certain elements of the short-duration, closed-end loan product prescribed by the NCUA's regulation
First, § 232.3(t)(2)(i) provides that the relevant law or rule must contain “[a] fixed numerical limit on the maximum maturity term, which term shall not exceed 9 months.” The short duration of the loan is the key arithmetic predicate for the exclusion for the application fee, and the Department has arrived at the upper boundary by selecting a maximum term which is fifty percent greater than the maximum term permitted under the NCUA's regulation.
Second, the condition in § 232.3(t)(2)(ii), namely, that the “law or rule contains a fixed numerical limit on any application fee that may be charged to a consumer who applies for such closed-end loan,” is consistent with one of the key conditions in the NCUA's regulation.
In addition to defining the “short-term, small amount loan” so that the creditor making the qualifying closed-end loan product must adhere to certain conditions integral for protecting a covered borrower, the Department has established a restriction on the number of times that a creditor may impose an application fee without being required to include that fee when computing the MAPR. Under § 232.4(c)(1)(iii)(B), a creditor who is a federal credit union or insured depository institution is not required to include in the MAPR an application fee charged for the qualifying closed-end loan product if the creditor charges the fee only once “in any rolling 12-month period.”
The upshot is that even though at this time the Department declines to adopt a general exemption for a federal credit union or an insured depository institution, the Department adopts new terms (notably, in §§ 232.3(t) and 232.4(c)(1)(iii)(B)) that allow either type of entity to exclude an application fee from the computation of the MAPR for a qualifying closed-end loan. By crafting this targeted exclusion, the Department affords comity to the FCU Act and similar federal laws, and nonetheless adopts a final rule that requires a federal credit union (or insured depository institution, as the case may be) to comply with the other MLA conditions when making a short-term, small amount loan.
The Department has considered other approaches that would afford comity with the FCU Act or other similar federal laws. For example, the Department has considered whether, as the NCUA and other comments argue, a PAL should be wholly excluded from the scope of “consumer credit,” and the Department concludes that that would be a step too far. In the Department's judgment, the Department may exercise
Even though the Department believes that the consumer credit regulated under the MLA generally should track the scope of credit regulated under Regulation Z, the Department recognizes that imposing the interest-rate limit of 10 U.S.C. 987(b) on credit card products likely would result in dramatic changes to the terms, conditions, and availability of those products to Service members and their families. Many commenters echo the Department's own recognition and underscore that a typical creditor that issues a credit card would be required to revamp the fee, terms, and other conditions for that credit product when offering it to a covered borrower or, more drastically, disqualify a covered borrower from opening that credit card account. One commenter, for example, offers the view that the Proposed Rule would, if adopted, “have a material and substantial impact on thousands of credit card issuers who must redesign technology, sales processes, and business strategies while incurring significant legal risk to comply with a proposal that affords Service members no increased protections.”
In this regard, when issuing the Proposed Rule the Department requested that interested parties “provide specific data relating to the benefits and costs of amending the regulation, including costs to implement measures to adjust computer systems and to train personnel. . . . Please provide information on the type of costs and the magnitude of costs by providing relevant data and studies.” 79 FR 58626. The Department does not dispute the views (as expressed in these two, as well as in other, comments) that creditors will encounter certain costs to adjust their business operations in order to comply with the interest-rate limit and other requirements of the MLA. Nonetheless, the comment from Schwartz & Ballen LLP offers no data in support of its view, and the Associations offer scant data.
As the Department explained when issuing the Proposed Rule, unlike the vast majority of credit products that are amenable to straightforward pricing mechanisms relating to the cost of the funds borrowed (such as solely on the basis of a fixed or variable interest rate applied for a term or on a periodic basis or, as discussed above, a combination of an `application' fee and a periodic rate), credit provided through a credit card account can be provided subject to pricing mechanisms that, in part, account for the value of products or services delivered through the cardholder's use of the card itself. In this regard, many creditors offer credit card products that, from a consumer's perspective, generally are subject to periodic interest-rate charges (
Comments on the Proposed Rule do not dispute that the cost of the funds borrowed in a credit card account can be segregated from the fees that a creditor expressly ties to specific products or services for using the credit card itself. For example, a foreign transaction fee that applies when the cardholder tenders the card for a purchase made outside of the United States can be segregated from the interest charge that the creditor may impose for the funds loaned to make that purchase. Even though some of these fees might appear to be relatively high under certain circumstances, the Department believes that the costs of bona fide fees expressly tied to specific products or services which may be imposed upon the covered borrower's own choices regarding the use of the card can meaningfully be distinguished from the cost of borrowing itself. Flatly applying the interest-rate limit of 10 U.S.C. 987(b) to credit card products could result in unusually adverse consequences to both creditors and covered borrowers, especially because creditors likely would be required to significantly re-structure their current products, services, and pricing mechanisms when providing credit cards to Service members and their families—without a corresponding benefit to those covered borrowers.
The Department also continues to believe that credit card products warrant special consideration under the MLA because comparable protections for consumers who use these products separately apply under the CARD Act. For example, the CARD Act, as implemented by the Bureau's Regulation Z, generally prohibits a card issuer from opening a credit card account or increasing the credit limit on an existing account without considering the consumer's ability to repay the amount borrowed on the account.
Several comments state that the CARD Act provides substantial protections to consumer-cardholders and that the protections under that law are sufficient to justify a wholesale exclusion from the definition of consumer credit for credit card accounts. One commenter, for example, explains that the prohibition against opening a credit card account or increasing the credit limit on an existing account without considering the consumer's ability to repay “helps prevent [covered borrowers] from obtaining credit that they may find difficult to repay.
Even though the CARD Act provides certain protections for all consumers that are not inconsistent with overarching objectives evident under the MLA, the Department has determined, at this time, that the interest-rate limit and other requirements of the MLA should not be completely set aside in reliance on the CARD Act for covered borrowers. The Department continues to believe that certain creditors could take advantage of an opportunity to exploit a complete exemption for credit cards by transforming high-cost, open-end credit products (which otherwise would be covered as “consumer credit”) into credit card products.
Even though the Department's general policy is to avoid, when possible, creating regulatory gaps in the framework for 10 U.S.C. 987, the Department believes that, for a definite period of time as set forth in the rule, consumer credit under the MLA should not include credit extended to a covered borrower under a credit card account under an open-end (not home-secured) consumer credit plan. However, when the exemption for a credit card account expires, this form of consumer credit would be subject to a qualified exclusion for bona fide application fees, participation fees, transaction-based fees, and similar fees connected to the use of the credit card under § 232.4(d).
Section 232.4(d) of the final rule allows a creditor to exclude from the MAPR a bona fide fee—other than a periodic rate—only to the extent that the charge by the creditor is (i) a bona fide fee and (ii) reasonable for that type of fee.
Among other comments on the proposed exclusion for a bona fide fee, many focus on the provision that would have required the fee to be “customary” in order to be excluded from the MAPR. In criticizing this aspect of the Proposed Rule, commenters believe that this condition could thwart innovation because a creditor would not be able to show that a fee for a newly-designed product or service for a credit card is “customary.”
The Department believes that the conditions for excluding a bona fide fee from the MAPR—namely, that the fee must be bona fide and “reasonable”—fairly allows Service members and their families to continue to have access to credit card products
Sections 232.4(d)(3) provides standards to guide determinations regarding whether a bona fide fee—other than a periodic rate—for a credit card account may be excluded from the calculation of the MAPR as “reasonable.”
Section 232.4(d)(3)(i) provides that the bona fide fee must be compared to “fees typically imposed by other creditors for the same or a substantially similar product or service.” The Department believes that this elementary like-kind standard is appropriate because a creditor should not be permitted to assess the
A comment on behalf of certain credit card issuers contends that the like-kind standard is “not workable in practice because it disregards the fact that there can be significant differences between issuers' credit cards and fails to provide a clear basis for determining what constitutes a comparable product or service.”
Second, the comment on behalf of these credit card issuers observes that creditors “treat specific types of transactions differently and the imposition of a fee for a particular type of transaction is not the same across all [creditors].” The like-kind standard does not contain a presumption that a creditor's assessment of a fee for a product or service must be relative to the product or service that is identical across all creditors; rather, the like-kind standard is designed to guard against the possibility that a creditor could improperly assess its (high) fee for one service (or type of transaction) relative to the (lower) fees charged by other creditors for a service (or type of transaction) that is different in kind. By describing the comparison to be made as between “the same
Different [creditors] treat different types of transactions as a `cash advance' transaction. For example, some [creditors] treat transactions involving traveler's checks, money orders or gift cards as a cash advance transaction because those [creditors] consider those transactions to be `cash equivalents' while other [creditors] do not. Under the [Proposed Rule], if [Creditor A] assesses a cash advance fee for four types of transactions, and [Creditor B] assesses a cash advance fee for only two of the four types of transactions, it is not clear whether [Creditor A] or [Creditor B] could deem their fees to be `like-kind' fees.
Of course they could. More precisely, § 232.4(d)(3)(i) would allow Creditor A to assess the reasonableness of the `cash advance' fee that applies to all four types of transactions by comparing its fee to the fee charged by another group of creditors who cover fewer than those transactions within their own structures of fees. Sections 232.4(d)(1) and 232.4(d)(3)(i) do not require a strict correlation among comparators. Even though each transaction that Creditor A classifies in its cardholder agreement as subject to a `cash advance' fee has distinctive features bearing on a payment (
To provide additional clarity on the application of the like-kind standard, the Department has modified § 232.4(d)(3)(i) by adding the statement: “Conversely, when assessing a foreign transaction fee, that fee may not be compared to a cash advance fee because the foreign transaction fee involves the service of exchanging the consumer's currency (
Section 232.4(d)(3)(ii) provides a firm, yet flexibly adaptable standard for a “reasonable” amount of a bona fide fee. Under this provision, a creditor may compare the amount of the bona fide fee to “an average amount for a substantially similar fee charged by 5 or more creditors each of whose U.S. credit cards in force is at least $3 billion in an outstanding balance (or at least $3 billion in loans on U.S. credit card accounts initially extended by the creditor) at any time during the 3-year period preceding the time such average is computed.” In this regard, the Department has modified § 232.4(d)(3)(ii) to clarify that a creditor may meet the $3-billion threshold even if the creditor has sold the credit card loans to a special-purpose vehicle or entered into another arrangement so that securities backed by the loans may be issued. The standard for a “reasonable” amount of a bona fide fee should be sufficiently flexible to allow for changing conditions in the marketplace for products and services provided through credit card accounts, and thus, as proposed, the Department has adopted language in the provision (“an average” of an amount charged by “5 or more creditors”) that allows a creditor to select any group of 5 or more credit card issuers who each have the qualifying amount of credit card loans in order to make a determination. The Department believes that using a pool of 5 or more of these qualifying creditors is reasonable because these creditors, taken together, would represent a
In order for a creditor to use the fee(s) charged by a credit card issuer when computing an average, the credit card issuer must have met the $3-billion threshold at any time during the 3-year period preceding the date when the creditor computes the average. If the amount of the creditor's own bona fide fee is less than or equal to the average of the amount charged by those 5 or more credit card issuers who each meets the $3-billion threshold, then the creditor's bona fide fee is reasonable for the purposes of the exclusion.
Section 232.4(d)(3)(ii) sets a threshold of $3 billion in outstanding credit card loans on U.S. credit card accounts held by a credit card issuer (or at least $3 billion in loans on U.S. credit card accounts initially extended by the creditor) in order for that issuer's fees to be eligible for inclusion in an average calculated for the purposes of compliance with the “reasonable” condition of § 232.4(d)(1). The Department has adopted the use of a minimum of 5 credit card issuers, each of whom meet the $3-billion threshold, in order to facilitate a creditor's ability to compute an average under the safe-harbor provision in light of a very manageable, yet fairly representative, sample of fees in the marketplace for credit card products. The Department has concluded that a $3 billion threshold of credit card loans is reasonable because that threshold would include a significant number of credit card issuers, whose credit card products make up the majority of the products in the current credit card market. Moreover, the credit card issuers who hold more than $3 billion in outstanding credit card loans (or had initially had originated more than $3 billion of credit card loans) on U.S. credit card accounts offer credit card products that are typical in that marketplace. The Department is aware that many credit card issuers who do not meet the $3-billion threshold may offer credit card products with lower or similar fees (relative to issuers who hold more than $3 billion in outstanding credit card loans); these issuers would benefit in a straightforward manner from the proposed method of computing an average for the purposes of the safe-harbor proposed in § 232.4(d)(3)(ii). The Department believes that establishing this threshold would prevent a niche issuer charging unreasonable credit card fees from benefiting from the safe harbor, in a manner that evades the intent of the rule, by comparing its fees only to the fees of other niche issuers, rather than a representative sample of the marketplace.
The Department also has adopted, as proposed, a rolling 3-year look-back period to facilitate a creditor's ability to establish that a credit card issuer meets the asset-size standard. This 3-year period is designed to facilitate the process for calculating, and relying on, an average amount for one or more relevant fees because, for example, when a creditor uses information from the past year to establish that a credit card issuer meets the asset-size threshold, the creditor could rely on the fee information relating to that credit card issuer's credit card products for the next two years. At the same time, the 3-year period is expected to provide stability to the safe-harbor determination, particularly if credit card loan holdings of credit card issuers shift significantly in response to market conditions or otherwise. Furthermore, a 3-year period is expected to provide adequate time for the Department to amend the threshold or safe harbor, as may be necessary.
The Department believes that all creditors who offer credit card products to Service members and their dependents could readily calculate whether each type of fee associated with those products may fit within the safe harbor because data relating to the fees imposed by other credit card issuers, as well as the amount of credit card loans outstanding, is widely available. With regard to credit card fees, most credit card issuers, particularly all of the largest issuers, make complete contract terms on their current offerings freely available on their Web sites as part of solicitations and applications for their products.
With regard to the amount of outstanding credit card loans held by a credit card issuer, issuers provide this information in both filings to the Securities and Exchange Commission (SEC filings) and Consolidated Reports of Condition and Income (Call Reports). Both SEC filings
For example, a creditor seeking to determine whether another credit card issuer could qualify as one of the 5 creditors for determining the average fee under § 232.4(d)(3)(ii) could download a recent Call Report for an issuer and review Schedule RC-C Part I line 6(a) that provides credit card “[l]oans to individuals for household, family, and other personal expenditures” held by the institution. If that credit card issuer indicated that it held more than $3 billion in outstanding credit card loans, then the creditor could include any fee charged by that credit card issuer in the creditor's safe-harbor calculation under § 232.4(d)(3)(ii). The creditor could find the amounts of the relevant fees for that credit card issuer disclosed on the issuer's current offerings, as available through a variety of sources, such as the issuer's Web site.
Section 232.4(d)(3)(iii) provides that a bona fide fee still may be “reasonable” for the purposes of the exclusion even if that fee is higher than an average amount as calculated under proposed § 232.4(d)(3)(ii). In particular, the Department recognizes that, due to
Consistent with the Department's policy that the “reasonable” amount of a bona fide fee is a standard designed to be applied flexibly, § 232.4(d)(3)(v) provides a standard in the particular case of a participation fee. The Department recognizes that creditors who issue credit cards provide a range of benefits and services to Service members and their dependents who are cardholders, and some cards may charge a participation fee in lieu of (or in light of lower) transaction-based fees. For example, a creditor may offer a credit card that carries a relatively higher participation fee, yet does not charge a foreign transaction fee. Accordingly, § 232.4(d)(3)(v) provides a standard stating that “[a]n amount of a bona fide fee for participation in a credit card account may be reasonable . . . if that amount reasonably corresponds to the credit limit in effect or credit made available when the fee is imposed, to the services offered under the credit card account, or to other factors relating to the credit card account.”
Many comments on the Proposed Rule focus on the transition in the method that a creditor could use to determine whether an applicant is a covered borrower. The Department continues to be keenly aware of the practical implications of offering a safe harbor relating to a creditor's assessment of an applicant to determine whether a credit transaction or account is subject to the Department's rule implementing the protections of the MLA. Nonetheless, nothing in 10 U.S.C. 987 mandates the provision of any safe harbor for a “covered-borrower check;” the Department elects to maintain the existence of a safe harbor in § 232.5 in the exercise of the authorities granted to it in the law.
In their comment on § 232.5 of the Proposed Rule, the Associations incorrectly state that there would be a “requirement for lenders to query the Department's [MLA Database]. . . .”
To underscore the Department's consistent policy regarding a covered-borrower check, the Department has modified § 232.5 to state, at the outset: “A creditor is permitted to apply its own method to assess whether a consumer is a covered borrower.”
Nevertheless, the Department still believes that a creditor should be afforded a degree of certainty regarding whether an extension of consumer credit is being made to a covered borrower, and to accomplish that purpose adopts new safe-harbor consistent with the provision contained in the Proposed Rule. The Department continues to believe that the dynamic between creditors and borrowers in actual transactions has led to widespread misuses of the individual's self-certification statement,
The Department also recognizes the reasonable concerns, raised in many comments on the Proposed Rule, regarding the various interests of creditors in using the MLA Database and the potential costs associated with changing systems for processing consumer credit applications to do so. For example, one commenter expresses the view that a small entity might not have the “financial resources” to use the MLA Database and thus “recommend[s] that small entities be allowed to continue to operate under a safe harbor that requires military members and their dependents to self-identify.”
The Department adopts a new safe harbor in § 232.5(b) that permits a creditor to legally conclusively determine whether a consumer is a covered borrower by using information obtained either: (i) Directly or indirectly from the MLA Database or (ii) in a consumer report from a nationwide consumer reporting agency or a reseller who provides such a consumer report. If the creditor uses one of these two methods (or both, as the creditor may elect), the creditor's determination would be conclusive with respect to that transaction or account involving consumer credit, so long as the creditor maintains a record of the information so obtained.
As the Department stated when issuing the Proposed Rule, commercial information-services providers reasonably might be anticipated to supply information products to financial institutions that would include covered-borrower checks as part of the products used to process loan applications. Nothing in § 232.5(b)(2)(i) prohibits or restricts a creditor from using a commercially-provided product containing information obtained from the MLA Database to conduct a covered-borrower check.
Nevertheless, several commenters encourage the Department to provide greater flexibility to creditors that may wish to use commercially provided information with underlying data supported by the Department's database. For example, the American Financial Services Association suggests that “[i]f the Department proceeds with the proposed safe harbor, the Department should clarify that a creditor may take advantage of the safe harbor by conducting a covered borrower check using a commercially provided information product whose underlying data is derived from the MLA Database.”
Nevertheless, at this time the Department is concerned that, despite the requirements of (and enforcement mechanisms that apply under) the FCRA, all consumer reporting agencies might not have sufficiently robust systems in place that would provide the degree of accuracy for covered-borrower checks that would warrant granting a safe harbor to their client-creditors. The Department observes that certain supervisory and regulatory mechanisms currently apply primarily (or exclusively) to nationwide consumer reporting agencies that reasonably can be expected to lead those entities to maintain sufficiently robust systems that would provide the degree of accuracy for covered-borrower checks. Consistent with the Department's approach to incrementally adopt and, as appropriate, amend its regulation to implement the protections of the MLA, the Department at this time is restricting the source of the consumer report that is eligible for the safe harbor in § 232.5(b)(2)(ii) to a nationwide consumer reporting agency or a reseller who obtains such a report (from a nationwide consumer reporting agency). As the Department gains more experience observing the effects of its regulation and continues to consult with the Federal Agencies, the Department may, as appropriate, review and consider whether to amend this provision of the regulation.
Several entities contend that under the safe-harbor provisions proposed in § 232.5, in conjunction with the definition of “covered borrower,” in § 232.3(g), a creditor would have needed to conduct “at least two checks of the
As the Department stated when issuing the Proposed Rule, the safe-harbor provisions of § 232.5(b) were designed to allow a creditor to be “free from liability under the MLA at the outset of establishing an account for credit—and throughout the lifespan of that particular account—relating to that consumer.”
The Department concludes that the final rule should be clarified to allow a creditor to have a legally conclusive mechanism to determine whether a consumer is a covered borrower at the time that the consumer is
Apart from the reliance on information from the MLA Database as a safe harbor, several entities raised concerns about the Department's proposal to provide an exception (in proposed § 232.5(c)) from that safe-harbor provision based on the creditor's actual knowledge that the consumer is a covered borrower. One credit union, for example, states: “Reviewing multiple record systems to comply with the `actual knowledge' requirement is impractical; it would likely entail manual review by credit union staff to ensure records are thoroughly and accurately searched. This would cause significant delays to the loan application and underwriting processes, and increased costs for financial products and services—both undesirable consequences for consumers.”
After considering the potential benefits of affording protections under the MLA to a covered borrower who is mis-identified through the creditor's use of the MLA Database or through some other method, the Department concludes that a creditor who conducts a covered-borrower check in reliance on information obtained from the MLA Database or from a consumer report obtained from a nationwide consumer reporting agency, and determines at the outset that a consumer-applicant is not a covered borrower should be provided a safe harbor from liability under the MLA—even if, in fact, that consumer is a covered borrower. If a creditor were to use either or both of the methods in § 232.5(b)(2) to ascertain the status of a consumer who applies for consumer credit, that creditor would demonstrate its best efforts under the circumstances to comply with the MLA, as implemented by the Department's regulation, and should receive, therefore, protection from liability if the database contains incorrect information about that consumer. Accordingly, the Department has determined that § 232.5(c) of the Proposed Rule should not be retained in the final rule.
Under § 232.5 of the final rule, no inference may be drawn concerning the validity of a creditor's own method—that is, a method other than one of the methods in § 232.5(b)(2)—to assess whether a consumer is a covered borrower. If a dispute regarding the requirements of the MLA were to arise in a case when the creditor had used its own method to assess the status of a consumer, then the issue of whether the consumer is or had been a covered borrower is a question of fact, and the parties would be subject to the rules of evidence, including the burdens of production, that apply to that case. More specifically, the absence of the actual-knowledge exception to the safe-harbor provision (as had been proposed § 232.5(c)) in light of the absence of any requirement to use any method to identify a consumer as a covered borrower (
A comment on behalf of certain credit card issuers seeks clarification regarding the potential effects of certain “customer management actions, such as credit line increases.”
The Department adopts this section as proposed.
The Department adopts this section as proposed, with a few amendments, including an example, to clarify that the protections of 10 U.S.C. 987 apply only when the consumer continues to hold the status as a covered borrower.
The Department proposed to add new subsection (a), stating: “Nothing in this part applies to a credit transaction or account relating to a consumer who is not a covered borrower at the time he or she becomes obligated on a credit transaction or establishes an account for credit.” The Department continues to believe that defining the scope of the regulation to apply only to a covered borrower when he or she enters into a transaction or establishes an account for consumer credit is consistent with the language and structure of 10 U.S.C. 987.
The Department adopts corresponding revisions to certain other provisions of the regulation, notably §§ 232.3(f) and 232.5(b)(2), for the sake of clarity and consistency with this policy.
The Department adopts § 232.2(b) as proposed.
Sections 232.3(f)(2)(i)-(iii) provide exceptions to “consumer credit” that track the exceptions to that term in the MLA.
The Department's existing rule, as well as the Proposed Rule, interpreted 10 U.S.C. 987(i)(6)(A) to exclude from consumer credit “any credit transaction secured by an interest in the
Certain credit products may, or may not, be covered under the Department's definition of “consumer credit,” depending, for example, on whether the particular credit product is subject to a “finance charge,” which the Department likewise defines consistent with the meaning of that term in Regulation Z. Most, if not all, “deposit advance” products would (when offered to a covered borrower) be covered as consumer credit because this type of product typically involves credit extended by a creditor primarily for personal, family, or household purposes for which the borrower pays any fee or charge that is, or is expected to be, repaid from funds available in the borrower's asset account held by that creditor. Likewise, consistent with Regulation Z,
Consistent with the Department's existing rule, § 232.3(f)(2)(iv) excludes from the scope of “consumer credit” any credit transaction that is an exempt transaction for the purposes of Regulation Z (other than a transaction exempt under 12 CFR 1026.29)
As discussed when issuing the Proposed Rule,
As discussed in section III.D., the Department adopts § 232.5(b) in order to afford a creditor a degree of certainty regarding whether an extension of consumer credit is being made to a covered borrower. Accordingly, and pursuant to the Department's authorities to prescribe regulations defining the scope of “consumer credit,”
For the reasons discussed in connection with the modification to § 232.2(a), the Department has modified the definition of “covered borrower,” by adding a new subparagraph (4), to clarify that a consumer who had been a covered borrower ceases to hold that status when the consumer no longer is a covered member or a dependent of a covered member.
As proposed, the Department adopts § 232.4(a), which tracks the restrictions under 10 U.S.C. 987(a).
Section 232.4(a)(2) tracks the restriction under 10 U.S.C. 987(a)(2), which provides that a creditor who extends consumer credit to a covered borrower shall not require the borrower to “pay interest with respect to the extension of such credit, except as . . . authorized by applicable State or Federal law.” As stated in the Proposed Rule,
Section 232.4(b) tracks the interest-rate limit of 10 U.S.C. 987(b).
Section 232.4(c) provides the framework for calculating the MAPR by: First, in § 232.4(c)(1), describing each of the charges that must be included in the MAPR; and second, in § 232.4(c)(2), prescribing the rules for computing the MAPR based on those charges.
Relative to the corresponding provisions of the Department's existing rule,
As stated in the Proposed Rule,
Aon Integramark similarly argues that under the Department's existing rule a fee for a debt cancellation contract is not included in the MAPR unless one of three conditions is met, consistent with the treatment of that type of fee under Regulation Z. In this regard, Aon Integramark observes that in § 232.3(h)(1) of the existing rule,
The Department recognizes that, by eliminating the condition that certain charges be included in the computation of the MAPR “if [those charges] are financed, deducted from the proceeds of the consumer credit, or otherwise required as a condition of the credit,”
As stated when issuing the existing rule, the Department remains concerned that covered borrowers are sold credit insurance products “without having these credit insurance products placed in the context of the Service member's employment status or his or her current level of insurance coverage.”
Insofar as some commenters urge the Department to align its treatment of credit insurance, debt cancellation, or debt suspension products vis-à-vis the computation of the MAPR with the treatment of those products under Regulation Z, that regulation provides for exclusions from the scope of the finance charges that must be disclosed for voluntarily agreed to “credit life, accident, health, or loss-of-income insurance,”
The Department has determined to modify § 232.4(c)(1)(ii), relative to that provision of the Proposed Rule and § 232.3(h)(1)(iii) of the existing rule, to require a creditor to include in the MAPR “fees for credit-related ancillary products sold in connection with and either at or before consummation of the [consumer credit].” As the Department explained when issuing the Proposed Rule, when § 232.3(h)(1)(iii) was adopted in 2007, including in the MAPR only the “credit-related ancillary products” sold “either at or before consummation of the credit transaction”
Section 232.4(c)(1)(iii) describes the charges that must be included in the MAPR in light of the definition of consumer credit, which would chiefly consist of “[f]inance charges,” consistent with Regulation Z. In general, a charge that is excluded as a “finance charge” under Regulation Z also would be excluded from the charges that must be included when calculating the MAPR. As a result, whereas the Department's existing rule had provided exclusions from the MAPR for late payment fees
However, the Department recognizes that, under Regulation Z, a wide range of charges that a creditor may impose in connection with a credit product are excluded as “finance charges,” particularly an application fee and a participation fee.
Section 232.4(c)(1)(iv) clarifies that, even if a charge set forth in paragraphs (c)(1)(i)-(iii) of this section would be excluded from the finance charge under Regulation Z, that charge nevertheless must be included in the calculation of the MAPR.
One commenter observes, for example, that “if a voluntary debt cancellation fee is charged to a credit
The Department now recognizes that the Proposed Rule left ambiguous the treatment of the charges set forth in § 232.4(c)(1)(i)-(ii) under the exclusion for bona fide fees. The Department intends for the charges set forth in § 232.4(c)(1)(i)-(ii) to be included in the MAPR irrespective of whether any other fee may be a bona fide fee eligible for the exclusion in § 232.4(d). Thus, the charges set forth in § 232.4(c)(1)(i)-(ii) must be treated separately from any fees excluded under § 232.4(d). Correspondingly, even if a creditor imposes one or more charges described in § 232.4(c)(1)(i)-(ii)—which always must be included in the MAPR—the creditor still would be able to exclude other, bona fide fees that meet the conditions in § 232.4(d). The Department has included, in § 232.4(d)(iii), examples to illustrate the interaction between certain charges that always must be included in the MAPR (
The final rule contains two provisions for computing the MAPR,
First, for closed-end credit, the rule requires a creditor to follow “the rules for calculating and disclosing the `Annual Percentage Rate (APR)' for credit transactions under Regulation Z,” based on the charges required for the MAPR, as set forth in § 232.4(c)(1). In general, the requirements for calculating the APR for closed-end credit under Regulation Z are found in § 1026.22(a)(1), and include the explanations and instructions for computing the APR set forth in appendix J to part 1026.
For example, the MAPR for single advance, single payment transactions, such as some types of deposit advance loans, must be computed in accordance with the rules in Regulation Z, such as by following the instructions described in paragraph (c)(5) of appendix J. Based on the formula provided in paragraph (c)(5) of appendix J, in the case of a single advance, single payment transaction loan extended to a covered borrower for a period of 45 days, and for which the advance is $500 and the single payment required consists of the principal amount plus a finance charge of $28.44, for a total payment of $528.44, the MAPR would be 46.14 percent. In this example, the resultant MAPR would exceed the interest-rate limit imposed by 10 U.S.C. 987(b), as set forth in § 232.4(b) of the regulation.
Second, for open-end credit, a creditor generally must calculate the MAPR using the methods prescribed in § 1026.14(c)-(d) of Regulation Z, which relates to the “effective annual percentage rate” (“effective APR”).
For example, suppose a creditor offers a line of credit to a covered borrower primarily for personal, family, or household purposes (commonly referred to as a “personal line of credit”), and permits the borrower to repay on a monthly basis. Upon establishing the personal line of credit, the covered borrower borrows $500. The creditor charges a periodic rate of 0.006875 (which corresponds to an annual rate of 8.25 percent), plus a fee of $25, charged when the account is established and annually thereafter. Under these circumstances, pursuant to § 1026.14(c)(2) of Regulation Z the creditor would calculate the MAPR as follows: “dividing the total amount of the finance charge for the billing cycle”—which is $3.44 (corresponding to (0.006875) × ($500)), plus $25—“by the amount of the balance to which it is applicable”—$500—and multiplying the quotient (expressed as a percentage) by the number of billing cycles in a year”—12 (since the creditor allows the borrower to repay monthly), which is 68.26 percent. In this example, even though the periodic rate (0.006875) would comply with the interest-rate limit under § 232.4(b), the resultant MAPR would be in excess of that limit because the amount borrowed is low at the time the annual fee is imposed. If the covered borrower instead borrows a higher amount, then the creditor still could impose the $25 annual fee and comply with § 232.4(b); for example, if the amount initially borrowed is $1,400, then the resultant MAPR would be 24.73, well below the 36 percent limit.
In the case of open-end credit extended through a credit card account, a creditor likewise would be required to calculate the MAPR using the methods prescribed in § 1026.14(c)-(d) of Regulation Z. For example, if a creditor extends credit to a covered borrower through a credit card account and the borrower incurs a finance charge relating to a specific transaction, such as a cash advance transaction, during the billing cycle, then the creditor would calculate the MAPR under the instructions set forth in § 1026.14(c)(3) of Regulation Z. However, in the case of a credit card account the creditor may exclude, pursuant to § 232.4(c)(1)(iii) and § 232.4(d), any bona fide fee from the finance charges that otherwise must be accounted for; thus, if a charge for the cash advance transaction fits within the exclusion for a bona fide fee under § 232.4(d), then that charge would not be included when computing the MAPR for that billing cycle.
In general, a creditor reasonably could be expected to estimate at the outset of a billing cycle whether charges to a covered borrower can produce an MAPR in excess of the limit in § 232.4(b), particularly because the creditor already would know the periodic rate and whether the non-periodic fees are covered by the exclusion for a bona fide fee under § 232.4(d). Nevertheless, under certain circumstances, a creditor might not know at the outset of a billing cycle whether the borrower's use of an open-end line of credit will lead to a finance charge that—through a combination of rates and fees—exceeds the interest-rate limit of the MLA. However, at the end of a billing cycle the creditor would be able to calculate the total charges included in the MAPR and waive an amount necessary to comply with the 36-percent limit of § 232.4(b).
Several comments contend that the requirement in § 232.4(c)(2)(ii) of the Proposed Rule, to apply the standards prescribed in § 1026.14(c)-(d) of Regulation Z, as the method to compute the MAPR for open-end credit is
After years of study, the [Board] published a final rule in 2009 that eliminated the requirement in Regulation Z for card issuers to calculate and disclose the APR for each billing cycle. The [Board's] decision to eliminate the historical APR was based on several factors, including extensive consumer testing which found that the effective APR is not helpful to consumers because it does not enable consumers to meaningfully compare costs from month to month or for different products.
These credit card issuers further state that “[t]he fact that the MAPR rate cap would be reached in some [billing] cycles and not in others depending, in part, on when a service member engages in a transaction would create a rule that bans the identical fee in one cycle and permits it in another cycle.”
The Associations likewise assert:
The proposed MAPR [calculation] simply does not work for the same reasons that the `effective APR' did not work and was discarded by the Federal Reserve. The MAPR will have the same distortions, creating a flawed measurement of the cost of credit. . . . To illustrate, assume a $4 transaction fee and a $100 draw made at the beginning of the month on an overdraft line of credit. This would translate to a minimum 48 percent MAPR—before interest is included. The MAPR could be much higher, depending on when the line was used and when the balance paid.
When in 2009 the Board amended Regulation Z to create an exemption from the requirement in TILA, thereby relieving a creditor from disclosing the effective APR, the Board interpreted TILA as follows: “The statutory requirement of [disclosing] an effective APR is intended to provide the consumer with an annual rate that reflects the total finance charge, including both the finance charge due to application of a periodic rate (interest) and finance charges that take the form of fees. This rate, like other APRs required by TILA,” the Board explained, “presumably was intended to provide consumers information about the costs of credit that would help consumers compare credit costs and make informed credit decisions and, more broadly, strengthen competition in the market for consumer credit.”
That the standards for computing the effective APR still stand in Regulation Z (albeit as an optional, not required, form of disclosure to a consumer) is a testament to their value for computing the cost of open-end credit during a given billing cycle on an annualized basis. The Department's reliance, in § 232.4(c)(2)(ii), on the standards set forth in Regulation Z
Section 232.4(c)(2)(ii)(B) generally would prohibit a creditor from imposing a charge in an open-end credit plan for any billing cycle during which there is no balance. However, this provision includes an exception for a participation fee (which otherwise would be required to be included under § 232.4(c)(1)(iii)(B)) because the Department concludes that there might be circumstances in which a creditor should be allowed to charge a bona fide fee for maintaining an open-end line of credit for a covered borrower. Still, recognizing that a creditor could structure a high-cost, open-end line of credit to fit within this exception by substantially increasing the participation fee, the Department has adopted a provision that limits that fee to $100 per annum, regardless of the billing cycle in which the participation fee is imposed. The Department believes that $100 is the highest reasonable amount that a creditor could charge as a bona fide participation fee, during a billing cycle in which there is no balance, for the purposes of keeping the line of credit open to the covered borrower. Furthermore, § 232.4(c)(2)(ii)(B) contains a provision to clarify that the $100-per annum limitation on the amount of the participation fee does not apply to a
The Department believes that credit card products warrant special consideration under the MLA. As discussed above, § 232.4(d) provides the conditional exclusion, including standards relating to the conditions, that allows a creditor to exclude bona fide fees charged to a credit card account from the MAPR. The Department believes that the condition for excluding a bona fide fee from the MAPR—namely, that the fee must be “reasonable”—would fairly allow Service members and their dependents to continue to have access to credit card products
However, as set forth in § 232.4(d)(4)(ii) (and apart from the fees described in § 232.4(c)(1)(i)-(ii), as discussed in part (2) (“Elements of the MAPR and Treatment of Items Under the Conditional Exclusion for Bona Fide Fees”)), a creditor who imposes any fee that is not a bona fide fee or that fails to meet the condition of being reasonable must include the total amount of those fees, including any bona fide fees, in the MAPR. Thus, if a creditor charges one unreasonable fee in a credit card account for a covered borrower, the creditor must include the total amount of the fees—including any fee(s) that otherwise may be eligible for the exclusion—in the MAPR. As discussed above, the “reasonable” condition for a bona fide fee, as proposed, is intended to be applied flexibly so that, in general, creditors may continue to offer a wide range of credit card products that carry reasonable costs expressly tied to specific products or services and which vary depending upon the covered borrower's own choices regarding the use of the card.
One comment states that the Department should further restrict the scope of the bona fide fees that may be excluded under § 232.4(d)(1) in order to exclude “transaction fees for cash advances.”
The Department has modified § 232.5(a) to more clearly provide that a creditor is permitted to apply its own method, as the creditor may elect, to assess whether a consumer is a covered borrower.
As discussed above, § 232.5 provides two mechanisms for a creditor to unilaterally assess the status of a consumer who applies for consumer credit in order to make a legally conclusive determination that a consumer is not a covered borrower: The creditor may use information from the MLA Database or from a consumer report obtained from a nationwide consumer reporting agency. For either mechanism, the creditor may make a determination regarding a consumer-applicant's status generally when the creditor enters into a transaction or establishes an account that is (or could be) consumer credit. Under either mechanism, a creditor must timely create and thereafter maintain a record of the information so obtained. Due to this timing constraint in § 232.5(b), a creditor who is an assignee has no occasion to avail itself of the safe harbor afforded in this section by separately assessing the status of an existing borrower for the purpose of determining that the borrower is not a covered borrower.
The Department realizes that several purposes would be served by preserving the use of the MLA Database for bona fide inquiries regarding the status of a consumer as a covered borrower in respect of an upcoming or pending application for credit—that is for the purposes of complying,
Section 232.5(b)(3) clarifies that a creditor is permitted to conduct a covered-borrower check by using one or both of the methods set forth in § 232.5(b)(2), and, if so, must timely create and keep the record of that information obtained. The creditor needs to undertake this covered-borrower check only once—namely, only at the time that (i) a consumer initiates the transaction, (ii) a consumer applies to establish the account, or (iii) the creditor develops or processes, with respect to a consumer, a firm offer of credit that (among the specific criteria used by the creditor for the offer) includes the status of the consumer as a covered borrower. In order to facilitate a creditor's process for responding to a consumer's inquiry about a loan—which could occur days or a few weeks before the consumer's application for that loan—as well as to reduce the traffic on the MLA Database, § 232.5(b)(3)(i)-(ii) permit the creditor to make a determination and keep a record of the information so obtained 30 days prior to the date of the transaction or the date the consumer applies to establish an account. Many commenters observe that a creditor who, for example, issues a credit card could conduct a covered-borrower check at the time that the consumer applies for the card, but that under the Proposed Rule a creditor would need to conduct another covered-borrower check at or around the time that the consumer becomes obligated on the credit (by using the card), which typically occurs later.
The Department has designed § 232.5(b)(3) in order to enable a
The Department amends § 232.6 of the regulation to simplify the information that a creditor must provide to a covered borrower when issuing consumer credit and to facilitate a creditor's oral delivery of the required disclosures, consistent with the requirements of 10 U.S.C. 987(c). In particular, the Department has determined: first, to eliminate the requirement in the existing rule for information to be provided “clearly and conspicuously;” second, to require a creditor to provide a “statement” of the MAPR that describes the charges the creditor may impose, instead of the periodic rate of the MAPR itself “and the total dollar amount of all charges included in the MAPR,” as the existing rule requires; third, to modify the Proposed Rule so that, for any transaction or account involving consumer credit, a creditor may elect to orally provide the required disclosures to the covered borrower either in person or by providing a toll-free telephone number that the borrower can use for that purpose; and, fourth, to eliminate the requirement in the existing rule that a creditor provide a specific statement regarding protections available to covered borrowers under federal law.
Section 232.6(a) requires a creditor to provide three categories of information to a covered borrower “at the time the borrower becomes obligated on the transaction or establishes an account for the consumer credit,” namely:
• A statement of the MAPR applicable to the extension of consumer credit;
• Any disclosure required by Regulation Z, which shall be provided only in accordance with the requirements of Regulation Z that apply to that disclosure; and
• A clear description of the payment obligation of the covered borrower, as applicable. A payment schedule (in the case of closed-end credit) or account-opening disclosure (in the case of open-end credit) provided pursuant to paragraph (a)(2) of this section satisfies this requirement.”
Section 232.6(d) requires a creditor to provide to a covered borrower the disclosures required under § 232.6(a)(1) and (a)(3) (which correspond to the items numbered above) both (i) in writing and in a form the borrower can keep and (ii) orally. When orally providing the required disclosures, a creditor may elect to provide the disclosures in person, as the circumstances surrounding the establishment of the transaction or account involving consumer credit may permit, or to provide a toll-free telephone number that the borrower can use for that purpose.
The Department's existing rule requires each of these categories of information to be provided “clearly and conspicuously” to a covered borrower.
The Department realizes that by eliminating the requirement to provide certain information in a manner that is clear and conspicuous there is a risk that a creditor might minimize the prominence of the statement of the MAPR or the clear description of the covered borrower's payment obligations amidst other disclosures, contract documents, statements, or marketing materials; in that circumstance, an ordinary covered borrower might not appreciate those items that, under the MLA, are intended to assist the borrower. Nonetheless, the Department has determined that, under the final rule, the interests of an ordinary covered borrower still would be served because: (i) Insofar as § 232.6(a)(3) permits a creditor to provide the relevant disclosure pursuant to Regulation Z as a mechanism for providing the “clear description of the payment obligation of the borrower,” the disclosure could be delivered in a manner which is clear and conspicuous; and (ii) even if the borrower is provided a description of
Section 232.6(a)(1) requires a creditor to provide a “statement” of the MAPR, instead of “[t]he MAPR applicable to the extension of consumer credit, and the total dollar amount of all charges included in the MAPR,” as required under § 232.6(a)(1) of the existing rule. When adopting this requirement in 2007, the Department recognized that the disclosure of the figures relating to the MAPR would apply only to the discrete forms of closed-end credit defined as “consumer credit,” and therefore interpreted the language of 10 U.S.C. 987(c)(1)(A) to require an annual percentage rate of interest. Nonetheless, the Department then recognized “the potential confusion inherent in mandating the disclosure of two differing annual percentage rates (the MAPR required by [its] regulation and the APR required by TILA).”
Section 987(c)(1)(A) of the MLA does not require the disclosure of a particular annual percentage rate or the “amount of all charges” applicable to the extension of consumer credit. Rather, 10 U.S.C. 987(c)(1)(A) requires a “
In addition, section 987(i)(4) of the MLA provides that the term “`annual percentage rate' has the same meaning as in section 107 of [TILA], as implemented by regulations of the [Bureau].” That term also includes “all fees and charges,” including certain charges that may be exempt from the term “finance charge” under Regulation Z.
In light of the scope of the definition of consumer credit, which encompasses open-end credit products, the Department exercises its discretion under the MLA
Section 232.6(c)(2) provides that a creditor may include a statement of the MAPR in its agreement with the covered borrower for the transaction of or account established for consumer credit. Consistent with the Department's interpretation of its existing regulation,
Section 232.6(b) establishes rules relating to transactions involving a creditor and assignee or multiple creditors. More specifically, § 232.6(b)(1) provides that the information required under the MLA is “not required to be provided to a
Section 232.6(d) establishes rules relating to the methods of delivery, which are substantively similar to the provisions of the existing rule and, yet, allow for greater flexibility. Under § 232.6(d)(1), a creditor must provide the information required under the MLA “in writing in a form the covered borrower can keep.” And under § 232.6(d)(2), consistent with the structure of the existing rule,
Under 10 U.S.C. 987(c)(1), a creditor must provide to a covered borrower certain information “orally and in writing,” but 10 U.S.C. 987(c)(2) provides that “[s]uch disclosures shall be presented in accordance with terms prescribed [in Regulation Z].” By requiring the disclosures to be “presented in accordance with” Regulation Z, the MLA is ambiguous as to the nature of the requirement to “orally” provide the disclosures because, in general, Regulation Z requires the disclosures required by TILA only to be presented to a consumer “in writing, in a form that the consumer may keep.”
In light of the ambiguities in 10 U.S.C. 987(c), and particularly in the context of conducting transactions involving consumer credit “through the internet,” the Proposed Rule had tracked the existing rule by allowing a creditor who is conducting a mail or internet transaction to provide to a covered borrower a toll-free telephone number that the borrower could use to obtain the oral disclosures.
Several comments raise general concerns about the requirement to orally provide the disclosures required by the MLA. The Associations, for example, state that in many transactions, creditors will face difficulties “persuad[ing] covered borrowers to listen to the oral disclosures at the time an account is opened, especially if they are not in a private setting. In addition, providing oral disclosures will require specialized training to ensure that the depository institution employee, at the right time, first identifies the customer as a covered borrower, and then, second, provides the oral disclosures.”
The Department concludes that the requirement in 10 U.S.C. 987(c) to deliver certain disclosures “orally . . . before the issuance of the credit” should be interpreted in a manner that provides a creditor straightforward mechanisms to do so at that time. Moreover, the Department has determined that a creditor should be afforded the latitude to develop the same (or consistent) systems to orally provide the required disclosures—regardless of the particular context of the transaction or account involving consumer credit (
Section 232.6(e) keeps intact the current provision, currently found in § 232.6(c) of the existing rule, that requires “a new statement”—to correspond with the statement of the MAPR under proposed § 232.6(a)(1)—and “disclosures under this section only when the transaction for that credit would be considered a new transaction that requires disclosures under Regulation Z.”
Under the Proposed Rule, § 232.6(a)(4) would have required a creditor to provide to a covered borrower a specific statement regarding protections for Service members and their dependents under federal law and resources that may be available to assist them with financial matters (“Statement of Federal Protections”). Consistent with the Department's stance when proposing its initial regulation in 2007,
Section 232.7 revises the corresponding section of the Department's existing regulation to reflect amendments to 10 U.S.C. 987(d)(2) enacted in section 661(a)(1) of the 2013 Act. In particular, § 232.7(b)(1) is amended to reflect the prohibition against a state to authorize creditors to charge covered borrowers rates of interest for “
When the Department adopted its initial regulation in 2007, § 232.8(a) provided an exception from the prohibition, set forth in 10 U.S.C. 987(e)(1), that applies to a creditor who rolls over, renews, or refinances consumer credit that had been extended to a covered borrower by the same creditor. The exception in the existing rule allows the same creditor to renew or refinance consumer credit to the covered borrower if “the new transaction results in more favorable terms to the covered borrower, such as a lower MAPR.”
Section 232.8(a) tracks the language of the rollover restriction of 10 U.S.C. 987(e)(1),
In the course of reviewing various comments regarding the scope of the limitations in 10 U.S.C. 987(e),
The Department adopts § 232.8(e) as proposed.
The Department adopts § 232.8(f) as proposed (now re-designated as paragraph (g) in light of the new § 232.8(f)), and notes that while this provision tracks the language of the prohibition of 10 U.S.C. 987(e)(6), the provision also contains an exemption for a unique class of creditors. More specifically, the Department has concluded to exercise its discretion to define a creditor for the purposes of 10 U.S.C. 987
As the Department explained when issuing the Proposed Rule, the specified Relief Societies provide essential emergency financial assistance to Service members. The specified Relief Societies make low- and no-cost loans, as well as grants, to Service members repayable through an allotment of military pay.
In light of the specialized operations of each of the specified Relief Societies, which currently depend crucially on the use of an allotment from a Service-member borrower's pay, and consistent with the Department's regulations on deductions from pay under 37 U.S.C. 1007, the Department has determined to exclude the Relief Societies specified in 10 U.S.C. 1033(b)(2) and 37 U.S.C. 1007(h)(4) from the definition of “creditor” only for the purposes of the prohibition in § 232.8(f).
In all other respects, § 232.8 substantially preserves the language of the existing provisions of § 232.8. However, the Department amends the structure of § 232.8 by eliminating subsection § 232.8(b) (and making other conforming amendments) because the definition of “creditor,” in § 232.3(i)(2), includes an assignee of a covered creditor.
The Department adopts § 232.9 as proposed.
The Department adopts § 232.10 as proposed.
The Department adopts § 232.11 as proposed.
In general, the Department adopts § 232.12 as proposed, particularly to reflect the effective dates of amendments to the MLA enacted in the 2013 Act. The Department has modified the dates set forth in this section in order to clarify the relationships between the effective dates (including the effective date of this final rule) and
Section 232.12(a) amends the language of § 232.11 of the existing rule to reflect the amendments adopted in the final rule.
Section 232.12(b) provides a general rule that the definitions, conditions, and requirements of the existing rule apply to transactions involving consumer credit that are consummated or established prior to the compliance date. Relative to the Proposed Rule, the language in § 232.12(b) has been revised to clarify that the “definitions, conditions, and requirements” of the existing rule apply. The Department believes that this provision is equitable, particularly to avoid the potential injustice and operational difficulties that could arise if new requirements under the final rule were to apply to pre-existing transactions or accounts involving consumer credit to covered borrowers. Section 232.12(c) provides exceptions to allow certain provisions of § 232.7(b) and § 232.9(e), as discussed below, to become effective prior to the effective date of the final rule.
Section 232.12(d) provides that “the amendments to 10 U.S.C. 987(d)(2) enacted in section 661(a) of the National Defense Authorization Act for Fiscal Year 2013 (Pub. L. 112-239, 126 Stat. 1785), as reflected in § 232.7(b) of this part, shall take effect on January 2, 2014.” Section 661(c)(2)(A) of the 2013 Act provides, in relevant part, that the amendments enacted in section 661(a) of that Act shall take effect on “the date that is one year after the date of enactment of this Act.”
Section 232.12(e) provides that civil-liability provisions adopted in § 232.9(e) “shall apply with respect to consumer credit extended on or after January 2, 2013.” This subsection reflects the effective date, established in section 662(c) of the 2013 Act, of the civil-liability provisions enacted in section 662(a) of that Act. The term “consumer credit” for purposes of this § 232.12(e) applies to the definition of consumer credit in force as of the date that the consumer and the creditor enter into the transaction or establish the account for that credit.
As discussed in section I.C., many comments on the Proposed Rule state that, if the Department were to adopt a final rule along the lines of the Proposed Rule, creditors would need a substantial period of time to modify their operations in order to comply with the rule. For example, the Associations state that creditors generally would need 18 months to comply with the rule, if adopted as proposed,
The Department concludes that, particularly because the protections of the MLA will apply to a wider range of credit products, a creditor should be afforded a reasonable period of time to adjust its operations and, if necessary, the terms and conditions of its loan product(s) offered to covered borrowers in order to comply with the regulation. Accordingly, under § 232.13(a), a creditor must comply with the requirements of the rule with respect to a consumer credit transaction or account for consumer credit consummated or established on or after October 3, 2016.
Consistent with the Department's determination regarding the 12-month period that allows a creditor to adjust its operations and loan product(s) to comply with the rule, a creditor also is permitted to use the existing safe harbor when assessing whether a consumer-applicant is a covered borrower.
Upon the compliance date, the rule permits—and does not require—a creditor to use information obtained from the MLA Database or information contained in a consumer report obtained from a nationwide consumer reporting agency in order to conclusively determine whether a consumer-applicant is a covered borrower. A creditor who uses one (or both) of the methods set forth in, and complies with the recordkeeping requirements of, § 232.5(b) when conducting a covered-borrower check will be afforded the new safe harbor.
The Department concludes that consumer credit should not include credit extended in a credit card account under an open-end (not home-secured) consumer credit plan until October 3, 2017. Section 232.13(c)(2) allows the Secretary (or an official of the Department duly authorized by the Secretary) to extend, up to an additional year, the expiration of the exemption for a credit card account. Thus, until October 3, 2017 (or potentially a longer period of time), the requirements relating to the computation of the MAPR for a credit card account, as set forth in § 232.4, would not apply. When the exemption expires, the conditional exemption for any “bona fide” fee charged to a credit card account, as set forth in § 232.4(d) would apply.
In accordance with the requirements of Executive Orders 12866
E.O. 12866 and E.O. 13563 direct executive agencies, including the Department, to assess the anticipated present and future benefits and costs of available regulatory alternatives—including both quantitative measures and qualitative measures—using the best available techniques. A determination has been made that this rule is a significant regulatory action, as defined in E.O. 12866 and as supplemented by E.O. 13563, in that this final rule might have an annual effect on the economy of $100 million or more. Accordingly, this regulation has been reviewed by the Office of Management and Budget (“OMB”). This rule, as well as any proposed revisions to this rule, are part of the Department's retrospective review plan under E.O. 13563 completed in August 2011. The Department's full plan and retrospective review reports is available at:
The Department anticipates that the final rule might impose costs of
The MLA, as implemented by the Department's existing rule as well as under this final rule, provides two broad classes of requirements applicable to a creditor: First, the creditor may not impose an MAPR greater than 36 percent in connection with an extension of consumer credit to a covered borrower (“interest-rate limit”); second, when extending consumer credit, the creditor must satisfy certain other terms and conditions, such as providing certain information (
The interest-rate limit results in a transfer payment because the amount of interest revenue to be foregone by a creditor—that is, the amount of interest revenue that a creditor otherwise could receive by imposing an MAPR of greater than 36 percent—necessarily corresponds to the amount saved by the covered borrower.
The Department recognizes that the voluntary mechanisms a creditor may use for identifying covered borrowers, as well as the requirements to provide certain disclosures, lead to various types of compliance costs for creditors, and the estimated cumulative amount of those quantified costs on an ongoing, annual basis is approximately $30 million. These conditions are anticipated to impose direct financial costs on a creditor that are not reasonably expected to be offset by any quantifiable, financial benefit to a covered borrower. For example, the Department believes that, for the purposes of conducting this assessment under E.O. 12866 and E.O. 13563, the estimated costs on creditors associated with the requirement to provide to covered borrowers a statement of the MAPR is not offset by any financial benefit to the borrowers, even though borrowers generally do obtain some non-quantifiable benefits from receiving the statement. Similarly, the Department expects that creditors will face compliance costs when assessing whether consumer-applicants are covered borrowers and maintaining records of that information, as provided in § 232.5(b), and consumers reasonably can be assumed to be indifferent to the functions associated with conducting covered-borrower checks and not receive any readily quantifiable, financial benefits thereof. The Department believes, as discussed in section III.F., there are benefits to a system for conducting a covered-borrower check that minimizes, or eliminates, the opportunity for a covered borrower to make a false statement regarding his or her status when applying for consumer credit. Likewise, the Department recognizes that the final rule could impose certain types of costs on covered borrowers, including a potential reduction in access to available credit. Nevertheless, as discussed in sections II.C. and II.D., the majority of Service members have access to reasonably priced (as well as low-cost) credit, and, as long as they wisely use those resources, they are likely not to need high-cost loans to fulfill their credit needs.
The annual ongoing estimates of the costs relate to each year following the first-year, phase-in period. This figure includes compliance costs for creditors that, with respect to credit card accounts under open-end (not home secured) credit plans would not be required to comply with the rule for an additional period of time, pursuant to § 232.13(c). The Department elects to conservatively estimate the activities of all creditors because the costs associated with credit card accounts eventually would be accounted for in the annual costs of the final rule.
Furthermore, the Department expects that creditors could adjust their systems on an incremental basis and makes no judgment about when creditors will undertake various activities and when the costs associated with this adjustment could accrue. The assessment provided here is designed solely for the purposes of evaluating the Department's action under E.O. 12866 and E.O. 13563, and is intended only to serve as an exposition of the regulatory costs of the amendments adopted in the final rule.
The scenario analysis that examines the anticipated benefit of the Department's regulation are the savings attributable to lower recruiting and training expenses associated with the reduction in involuntary separation of Service members where financial distress is a contributing factor. Each separation of a Service member is estimated to cost the Department $58,250, and the Department estimates that each year approximately 4,640 to 7,580 Service members are involuntarily separated where financial distress is a contributing factor. If the Department's proposed regulation could reduce the annual number of involuntary separations where financial distress is a contributing factor from between 5 to 30 percent, the savings to the Department could be in the range of approximately $13.51 million to $132.52 million each year.
Figure 1 (which also appears in the Executive Summary, in section I.E.) provides a summary of the anticipated benefits and (costs) of the Department's amendments to the MLA regulation,
The Department amends its existing rule primarily for the purpose of extending the protections of 10 U.S.C. 987 to a broader range of closed-end and open-end credit products. More specifically, as discussed above, the Department amends its rule so that, in general, consumer credit covered under the MLA
In developing this final rule, the Department has consulted with the Federal Agencies (pursuant to 10 U.S.C. 987(h)(3)), and in the course of that process has considered a range of alternatives to the provisions contained in this regulation. For example, in developing the provisions for the conditional exclusion for credit card accounts, the Department has considered a complete exemption from the definition of “consumer credit” for credit extended to a covered borrower under a credit card account. The Department similarly has considered whether exclusions from the MAPR for all non-periodic fees should be permitted for credit card accounts in order to preserve current levels of access to those products for covered borrowers.
Similarly, in developing the provisions relating to a creditor's assessment of a covered borrower, the Department considered alternatives to the creditor's use of information obtained directly or indirectly from the MLA Database in order to obtain the benefit of a safe harbor under § 232.5(b). In this regard, the Department considered alternative provisions relating to a creditor's use of information obtained from the MLA Database, and adopts an additional mechanism that a creditor may use to avail itself of the safe harbor in § 232.5(b). The Department also considered whether to retain a safe harbor for a creditor's use of the covered borrower identification statement, but declines to retain that mechanism after the general compliance date.
The Department believes that this final rule is appropriate in order to address a wider range of credit products that currently fall outside the scope of the existing rule, streamline the information that a creditor must provide to a covered borrower when consummating a transaction involving consumer credit, and provide a more straightforward mechanism for a creditor to conclusively determine—via a safe harbor—whether a consumer-applicant is a covered borrower. In this regard, as discussed in section III.F., the Department is aware of misuses of the covered borrower identification statement whereby a Service member (or covered dependent) falsely declares that he or she is not a covered borrower. The Department believes that, if a creditor elects to conduct a covered-borrower check by using information obtained from the MLA Database or information in a consumer report obtained from a nationwide consumer reporting agency, a Service member or his or her dependent would be relieved from making any statement regarding his or her status as a covered borrower.
The Department estimates that approximately 37,500 creditors will fall within the parameters of this regulation.
The Department believes that creditors who offer consumer credit products that are subject to the modified regulation will face several types of compliance costs. For the purposes of this regulatory impact assessment, the Department has focused its quantitative assessment of costs on two areas that, based on the Department's experience, are reasonably likely to impose costs: First, the disclosures required by the MLA to be provided by a creditor to a covered borrower (under § 232.6); and, second, employing one of the methods available for conducting covered-borrower checks—through the use of information obtain from the MLA Database or the use of information in a consumer report obtained from a nationwide consumer reporting agency—and the retention of related records, as provided in § 232.5(b).
The Department recognizes that this assessment does not capture all possible compliance costs associated with the final rule. Indeed, the Department anticipates that a creditor who chooses to extend credit with a cost that may exceed the interest-rate limit or implicate the limitations in § 232.8 would need to adjust its computer and software systems to calculate the MAPR, develop new policies and procedures, or train staff on new procedures for identifying covered borrowers. Further, creditors likely would select different techniques for meeting compliance obligations under the final rule. The costs to each creditor could vary depending on the business decisions made by that creditor.
Acknowledging the limits of the assessment and pursuant to the directive of E.O. 12866 and E.O. 13563, the Department has sought to quantify the important potential costs of the final rule and to identify important non-quantified potential costs and benefits.
Fewer than two dozen of the comments on the Proposed Rule contain estimates of potential costs or benefits with the proposal to modify the existing rule. Comments focus on the cost to creditors of updating their systems to comply with the interest-rate limit and set-up and ongoing costs associated with the optional safe harbor proposed for conducting a covered-borrower check,
Section 232.6 of the final rule amends the provisions relating to the information required by the MLA, first, to simplify the information that a creditor must provide to a covered borrower when extending consumer credit, and, second, to streamline the methods of orally providing the required disclosures. More specifically, the final rule: Relieves a creditor of the obligation to disclose “clearly and conspicuously” the information required by the MLA; relieves a creditor
The Department estimates that there are approximately 238 million transactions each year in which creditors would provide the required information,
At the time that the Department assessed the Proposed Rule, there were approximately 40,000 creditors that fell within these parameters; the updated estimate of the affected creditors reflects the change in the overall number of establishments within the same categories from the Bureau of Labor and Statistics, the FDIC, and the NCUA.
For creditors who currently provide disclosures to covered borrowers (under the existing rule), the final rule is expected to reduce some of their compliance costs by eliminating the requirement to disclose a numerical value for the MAPR. The Department largely maintains for the final rule the estimates generated in developing the Proposed Rule, and updates that estimate to reflect more recent wage and dollar value figures.
The requirement that creditors provide a statement of the MAPR, which may be satisfied through the use of a model statement, is anticipated to cost all creditors approximately $24.01 million during the first year, principally due to the costs of modifying the documents given to covered borrowers (such as a contract for consumer credit).
The Department assumes that creditors will update standard account disclosures for all consumer credit accounts and that the printing and paper costs are five cents per page.
Under the framework of the Proposed Rule, the Department had estimated that the cost of providing the statement of the MAPR orally at the time of sale in face-to-face transactions would be $0.69 million per year. Several commenters urge the Department to modify § 232.6 to permit a creditor to satisfy its obligation to orally provide disclosures by providing a toll-free telephone number, as the Department has permitted for transactions conducted over the internet. In the final rule, the Department adopts § 232.6(d)(2) to allow a creditor to orally provide the required disclosures by providing to the covered borrower a toll-free telephone number, subject to certain conditions, and this option is permitted for all channels for conducting transactions or establishing accounts involving consumer credit. Solely for the purposes of its analyses under E.O. 12866 and E.O. 13563 and the other analyses in this section, the Department believes that the vast majority of creditors will avail themselves of this mechanism for orally providing the required disclosures.
While commenters urge the Department to permit creditors to provide oral disclosure through a toll-free number, these commenters do not provide any estimate of the costs or savings associated with this provision.
Under the Proposed Rule, like the existing rule, a creditor would have been required to provide to a covered borrower the Statement of Federal Protections. Because the Proposed Rule would have applied the protections of 10 U.S.C. 987 to a broader scope of credit transactions, an additional 20,000 creditors would have been required to provide the Statement of Federal Protections. In the final rule, the Department determines that, in balancing the interests of covered borrowers in receiving useful information with the interests of creditors vis-à-vis facilitating compliance and reducing the costs associated thereto, eliminating the requirement that creditors provide a Statement of Federal Protections best serves these purposes. This modification will relieve those creditors that offer consumer credit subject to the existing rule from the obligation to provide a Statement of Federal Protections when providing that credit to Service members and their dependents. Relieving creditors of the obligation to provide a Statement of Federal Protections will reduce some costs for those creditors that currently extend consumer credit subject to the existing rule. However, the Department believes that, due to the relatively low number of creditors who currently offer loans subject to the existing rule, the impact of this amendment generally will be relatively minor; therefore, the Department does not account for the estimated reduction in burden in this analysis of the final rule.
Figure 3a provides a summary of the anticipated benefits and (costs) associated with the disclosures under the Department's modified regulation.
Solely for the purposes of its assessment in this section V., the Department assumes that all creditors, other than creditors who offer only residential mortgage loans or loans expressly to finance the purchase of personal property (neither of which loans is consumer credit), will establish processes to use one of the mechanisms for conducting a covered-borrower check described in § 232.5(b). As described above, the Department believes that approximately 37,500 creditors would be subject to the final rule. The Department believes that setting up a process to use information obtained from the MLA Database or to use information in a consumer report obtained from a nationwide consumer reporting agency and to retain records of that information will take each creditor 70 hours of labor time. The actual cost for each creditor will depend on that entity's business decisions. For example, if one or more of the nationwide consumer reporting agencies incorporate information about covered borrower-status into consumer reports, a creditor that already obtains a consumer report from one of those nationwide consumer reporting agencies (or that report from a reseller) during the credit origination process might choose to use information provided as part of the report to avail itself of the safe harbor in § 232.5(b). Another creditor, particularly one that does not already have the agreements and technological connections in place to obtain consumer reports from a nationwide consumer reporting agency, may instead choose to use information from the MLA Database, as permitted in § 232.5(b). And a third creditor, particularly one that offers credit products that comply with the MLA and this final rule, may choose to forgo the use of a method described in § 232.5(b) when determining the status of a consumer-applicant.
Nonetheless, assuming that each of the approximately 37,500 creditors subject to the final rule establishes a process for availing itself of one of the safe harbors under § 232.5(b) and that each creditor will incur 70 hours of labor time in doing so, the Department estimates that the total costs relating to setting up the processes to use the methods set forth in § 232.5(b) would be $84.02 million.
The Department contemplates that a creditor could use batch processing to conduct covered borrower checks of a portfolio of potential customers. For example, a depository institution or credit union that offers open-end lines of credit with an MAPR in excess of 36 percent might choose to use batch processing capacity in the MLA Database before offering or extending those types of loans, and thereby take advantage of the safe harbor in § 232.5(b), to identify potential covered borrowers within its account portfolio. As with making an individual inquiry of the MLA Database, making a batch inquiry of the MLA Database can be done by a creditor (or nationwide consumer reporting agency) free of charge. Nonetheless, the comments on the Proposed Rule do not provide any data as to the costs to creditors associated with identifying covered borrowers through batch processing on the MLA Database. In light of the absence of data relating to batch processing for covered-borrower checks, the Department does not estimate the costs of conducting those checks. The Department observes that a creditor who currently offers consumer credit products (as defined by the existing rule), typically requires all consumer-applicants to complete the self-declaration form, and for that type of creditor, replacing the self-declaration form with a process to use information obtained from the MLA Database or information in a consumer report from a nationwide consumer reporting agency is estimated to result in a savings from transaction time, printing and paper costs, as well as a reduction in legal risks. In assessing the Proposed Rule, the Department estimated that the elimination of the self-certification procedure would result in savings for creditors who currently offer consumer credit products covered by the existing rule. The Department maintains those estimates in assessing the final rule, and updates the figures for 2015 dollars. The Department estimates that the savings in printing and paper for those creditors who offer consumer credit products covered under the existing rule will be $0.29 million per year; over 10 years, the Department estimates a savings of between $1.77 million (at a 7 percent discount rate) and $2.48 million (at a 3 percent discount rate). As in the Proposed Rule, the Department has not quantified the expected savings for creditors with respect to the potential reduction in transaction time or legal risk.
For the purposes of its assessments in this section V., the Department expects that the final rule will prompt all creditors who offer consumer credit with an MAPR of more than 36 percent (which would include some creditors who offer credit products with credit insurance premiums or fees for credit-related ancillary products sold in connection with the consumer credit) to assess the status of consumer-applicants as potential covered borrowers. The Department estimates that of the estimated 238 million covered credit applications each year,
For each of the uses of a record to conduct a covered-borrower check, the inquiry and record retention is expected to add approximately 60 seconds to each new consumer credit transaction.
Because modern credit applications, whether conducted online or in person, involve highly automated systems for underwriting, the Department expects that many creditors—including creditors who issue credit cards—will choose to develop systems that would make the marginal increase in time for using information from the MLA
Database relatively low. The Department does not estimate the potential costs associated with computer programming or including a covered-borrower check in automated underwriting.
Figure 3b provides a summary of the anticipated benefits and (costs) associated with the covered-borrower checks under the final rule.
The Department recognizes that the preceding quantitative assessment does not capture all possible compliance costs associated with the final rule. The Department believes that some of the compliance costs due to the other MLA conditions are not material to the quantifiable aspects of this regulatory impact assessment because some costs are minimal (relative to the creditor's other compliance costs or the creditor's overall costs of operations when providing consumer credit) or not amenable to measurement.
In considering whether to amend its regulation, the Department sought comment on all aspects of the Proposed Rule and on the estimates made in its assessment. In particular, the Department sought specific data relating to the benefits and costs of amending the regulation, as proposed, including costs to implement measures to adjust computer systems and to train personnel. The Department requested that commenters provide information on the type of costs and the magnitude of costs that might be borne by creditors by providing relevant data and studies.
The Associations state that the analysis of the Proposed Rule “grossly underestimates the intrinsic costs of the expansion in coverage of the proposed rule, as well as the cost of particular provisions.”
The Associations describe certain, specific costs other than those accounted for in the qualitative analysis that the Department should take into account in assessing the cost of complying with the final rule, namely, costs associated with: (a) Reviewing, revising, and replacing contracts for all credit contracts; (b) reviewing and revising contracts to comply with the prohibition on the waiver of legal rights; (c) reviewing, adjusting, and implementing systems to calculate the MAPR and waiving fees when the costs of the credit during a given billing cycle exceeds the interest-rate limit, as well as “significant systems and operations changes” to comply with the interest-rate limit for open-end credit products; (d) class actions that “the regulation itself will attract;” (e) being subject to supervisory examination; and (f) implementing and maintaining a “shadow control process” for MAPR compliance.
The Department believes that many creditors will incur costs with implementing changes to their business operations and, on an ongoing basis, maintaining systems to comply with the other MLA conditions. The Department believes that many creditors will review and revise their credit contracts in order to comply with the MLA conditions going forward and that there will be costs associated with this process. For example, the Department expects that creditors will review and, as needed, revise contracts currently in use in order to comply with the prohibition on requiring a covered borrower to waive legal rights under the Servicemembers Civil Relief Act or other laws. The Associations report that one bank has six basic account agreements and “approximately 180 ancillary original documents in its library;”
Credit card issuers who offer consumer credit at costs in excess of the interest-rate limit and who wish to avail themselves of the conditional exclusion for bona fide fees will need to update computer systems for these products in order to calculate the MAPR. Depending on the business practices of the creditor, these programs could be “complex and sophisticated” and could “require ongoing transaction monitoring and crediting processes.”
In assessing the Proposed Rule, the Department considered, though did not quantify, the costs associated with the MLA's prohibition on requiring a Service member or his dependent to submit to arbitration in the case of a dispute related to an extension of consumer credit. Under the existing rule, the prohibition against requiring a covered borrower to submit to arbitration applies only to certain payday loans, vehicle title loans, and refund anticipation loans. Under the final rule, the prohibition against requiring arbitration applies to agreements for a significantly broader range of credit products, such as credit cards and deposit advance loans. In assessing the final rule, the Department continues to recognize that extending the application of the prohibition in § 232.8(c) likely will lead to costs, primarily as a result of the significantly broader range of creditors affected by that prohibition. The Associations suggest that the prohibition on requiring arbitration will itself attract class action lawsuits, though do not provide an estimate of those costs.
The Department also recognizes that the fact of a regulation may cause a creditor to incur certain costs associated with the need to “know and implement” the laws applicable to certain activity in the market and the process of supervisory examination.
Each year, thousands of well-trained Service members are compelled to leave military service where financial distress contributes to the revocation of their security clearances. The Department has direct experience with this process of involuntary separation, which generally involves a Service member becoming over-extended in debt—which occurs due to a wide range of factors—defaulting on one or more credit agreements (either by making late payments or by failing to make payments), and experiencing a deterioration in the credit score or credit history prepared by a consumer reporting agency for that individual. The individual's deteriorating creditworthiness presents an exposure to the Department that the individual poses a security risk, which ultimately warrants separation.
As discussed in sections II.B., II.C., and II.D., the Department makes a significant investment in recruiting, training, and progressing each qualified Service member. Losing a qualified soldier, sailor, airman, or Marine can cause a loss of mission capability, and there are substantial costs associated with replacing that Service member. Even though, for the purposes of this regulatory impact assessment under EO 12866 and EO 13563, the most direct effect of the interest-rate limit is a transfer payment, a secondary—yet no less direct—effect is the reduction in the overall amount of debt owed to creditors by covered borrowers. The Department believes applying the interest-rate limit to a broader range of credit products will reduce the overall amount of debt owed to creditors; as a result, regardless of the original occasions for incurring debts, Service members reasonably may be expected to have a lower incidence of financial distress, and a correspondingly lower incidence of involuntary separation where financial distress is a contributing factor. Thus,
The Department estimates that each separation costs the Department $58,250.
For the years 2004 through 2013, there was an average of 54,293 involuntary separations per year. Of those involuntary separations that were due to legal or standard-of-conduct issues—an average of 18,961 per year—the Department estimates that approximately half are attributable to a loss of security clearance, and, of these, 80 percent are due to financial distress.
In 2005, there were 1,999 revocations of security clearances as a result of financial problems in the Navy and Marine Corps,
The Department estimates that the 10-year cost of involuntary separations due to financial distress is between $1.646 billion and $3.769 billion. However, the Department believes that these calculations significantly underestimate the impact of involuntary separations due to financial distress on Service-member retention and military readiness, primarily because the loss of security clearance is only one way that financial distress leads to separation from military service. Furthermore, involuntary separation is only one of the ways to detect the impact of financial distress on military readiness; excessive debt—which is less manageable at higher rates of interest—likewise can impair a Service member's eligibility to deploy or to reenlist.
The Department acknowledges that the final rule will not entirely eliminate financial distress among Service members. However, the Department expects that extending the protections of 10 U.S.C. 987 to a broader range of credit products will significantly reduce the incidence of derogatory items in the credit files of Service members (maintained by consumer reporting agencies), and thereby improve the Service members' respective capacities to manage and pay debts.
The Department estimates that the final rule will reduce the separations associated with financial distress. To assess the anticipated savings reasonably attributable to a reduction in involuntary separations, the Department has used three estimates of the possible reduction in involuntary separations: 5 percent,
The Department estimates that the final rule will result in savings from involuntary separations due to financial distress of between $13.51 million and $132.52 million per year. Over 10 years, the rule will save the Department between $95.81 million and $1.263 billion. Figure 4 provides a summary of the anticipated savings that reasonably could be attributable to reduction in involuntary separations where financial distress is a contributing factor.
In addition to reducing the quantifiable costs associated with separations where financial distress contributed, the Department believes that the regulation will reduce non-quantifiable costs associated with financial strains on Service members. High-cost debt can detract from mission focus, reduce productivity, and require the attention of supervisors and commanders. As one commenter observed the Service member's “mission can easily be jeopardized if he or she is worried about financial burdens back home.”
The Department believes that the interest-rate limit and the corresponding provisions governing computation of the MAPR entails some costs to creditors, particularly creditors who might need to adjust their systems to compute the MAPR in accordance with the standards of the final rule. However, there are no reliable data that would allow the Department to develop a quantifiable estimate of the costs associated with compliance with the interest-rate limit and the provisions governing computation of the MAPR. In this regard, for example, the Associations assert that calculating the MAPR will be “a significant challenge and costly,” even in light of “the sophisticated technology of today's world.”
Even though the interest-rate limit of 10 U.S.C. 987(b) results in transfer payments from various creditors to covered borrowers, and thus does not affect the benefits-cost analysis under E.O. 12866 and E.O. 13563, the Department has estimated the amounts involved in these payments.
In the credit card market, the Department believes that most creditors should be able to comply with the limitation on the MAPR by continuing to offer credit card products with minimal or no alternations to their current pricing practices. In this regard, few, if any, creditors who offer credit card products charge periodic rates that exceed the interest-rate limit of 10 U.S.C. 987(b) and § 232.4(b). Taking into account the exclusion for bona fide fees under § 232.4(d), the Department expects that nearly all of the amount of the transfer payments in credit card products will be due to revenues that would be foregone from credit insurance, debt cancellation, and credit-related ancillary products sold to covered borrowers.
The Department estimates the amount of the transfer payments by taking the difference of the cost of credit for a typical credit card with a credit insurance or debt cancellation product and 36 percent MAPR, less the payout rate on a credit insurance or debt protection product. To calculate the range of possible transfer payments associated with credit card products, the Department estimates an amount per account, and then makes a high- and low-end estimate of the number of Service members with credit cards who also carry a credit insurance or debt cancellation product that would cause the MAPR to exceed the 36-percent threshold.
The Department is aware that there are other credit-related ancillary products that may be sold in connection with, and either at or before, the account opening. The Department has not estimated the amount of the transfer payments that might be associated with those credit-related ancillary products.
To estimate the amount of the transfer payment for each credit card account, the Department assumes that 78 percent of Service members have a credit card,
Second, from an examination of credit card offers, the Department estimates that between 44 and 100 percent of the 78 percent of Service members who have a credit card account have a card with an APR sufficiently high that if the creditor also sells a credit insurance or debt cancellation product, the cost of credit could exceed the limit in 10 U.S.C. 987(b). The Department assumes that 7 percent of these accounts actually use credit insurance or debt cancellation; therefore the estimates are based on the assumption that between 3 percent and 7 percent of the 78 percent of Service members holding credit cards have a credit insurance or debt cancellation product.
At the high-end, assuming that 78 percent of Service members have a credit card that, given typical costs, might exceed the interest-rate limit if the borrower purchases credit insurance or debt cancellation and pays a penalty APR, and that 7 percent of these borrowers actually do purchase such a product, the amount that would be transferred is estimated to be $6.72 million per year.
At the low-end, assuming that 44 percent of Service members have a credit card that, given typical fees, might exceed the interest-rate limit if the borrower purchases credit insurance or debt cancellation and pays a penalty APR, and that 7 percent of these borrowers actually do purchase such a product, the amount that would be transferred is estimated to be $2.96 million per year.
For non-credit card credit products that are subject to the final rule, the Department estimates the amount that would be transferred due to the interest-rate limit by considering three segments of that market for consumer credit: Payday loans, auto title loans, and non-purchase money installment loans. The Department assumes that approximately 12 percent of Service members use non-credit card credit products that will be covered under the rule.
In order to estimate the amount that will be transferred, the Department assumes that between 7 percent and 4.9 percent of Service members use payday loans with a median APR of 391 percent and a median 10 transactions per year, each borrowed for 14 days,
Given typical prices of payday loans and borrowing patterns, the Department estimates that the value that will be transferred is $534 per borrower per year for payday loans.
Approximately 7 percent of volume in payday loans is done by online lenders based offshore.
Assuming that 0.3 percent of Service members use auto title loans each year and that the average auto title loan carries an APR of 300 percent, the Department estimates that the interest-rate limit will lead to transfer payments relating to the auto title lending industry of $0.86 million per year.
Assuming that 7 percent of Service members use high-cost installment loans each year and that the average installment loan carries an APR of 80 percent, the Department estimates that the interest-rate limit will result in transfer payments relating to the domestic installment lending industry of $59.81 million per year.
Approximately 7 percent of volume in the high-cost installment lending market is done by online lenders based offshore.
Overall, the Department estimates that the total amount of transfer payments relating to these four categories of consumer credit products will be between $100.22 million and $119.34 million per year; over 10 years, the overall amount of these transfer payments will be between $616.01 million (assuming lower usage rates and a 7 percent discount rate) and $1.022 billion (assuming higher usage rates and a 3 percent discount rate). Of these overall amounts, between $6.75 million and $7.83 million of the transfer payments relate to offshore creditors, and between $41.10 million and $66.73 million over 10 years. The transfer payments from domestic creditors will be between $93.47 million and $111.51 million per year; over 10 years, these transfer payments will be between $574.91 million (assuming lower usage rates and a 7 percent discount rate) and $954.90 billion (assuming higher usage rates and a 3 percent discount rate). Figure 5 provides a summary of all of these figures for the transfer payments.
The Department does not expect that the interest rate limitation will have undesirable side-effects for Service members. The Department observes that numerous creditors currently supply credit to Service members in a manner that already should comply with the interest-rate limit.
Further, in the Department's experience, covered borrowers enjoy access to low- and no-cost credit. For example, to provide monetary support to Service members and their families with financial hardships, the Military Services have partnered with nonprofit charitable organizations chartered to provide relief services to Service members and their families. The four Relief Societies for the Military Services provide no-interest loans and grants for shortfalls in household expenses and unforeseen emergencies.
The Congressional Review Act establishes certain procedures for major rules, defined as those with similar major impacts. This final rule will have a major impact as that term is used under the Congressional Review Act.
Section 202 of the Unfunded Mandates Reform Act of 1995 requires an agency to prepare a budgetary impact statement before promulgating a rule that includes a federal mandate that may result in the expenditure within any one year by state, local, and tribal governments, in the aggregate, or by the private sector of $100 million or more in 1995 dollars updated annually for inflation.
The Department certifies that this proposed regulation is not subject to the Regulatory Flexibility Act (“RFA”)
The North American Industrial Classification (NAIC) codes for the affected businesses are the following:
Pursuant to the Small Business Administration (SBA) Small Business Size Standards, a consumer lending business is a “small business entity” if it has less than $38.5 million in receipts. According to the 2007 Economic Census (the last year for which data is available), approximately 96 percent of firms in NAIC code 522291 are small business entities. For the other three potentially affected businesses, the SBA Small Business Size Standards considers any business with less than $550 million in assets to be a small business entity.
Approximately 81 percent of firms in NAIC code 522110 and 94 percent of firms in NAIC code 522130 are small business entities. Overwhelmingly, credit card products are issued by insured depository institutions and, therefore, small business entities issuing credit cards (included within NAIC code 522210) are covered by the previously described codes.
As detailed in Section V.A., the Department estimates the final rule might impose costs of approximately $106 million during the first year, as creditors adapt their systems to comply with the requirements of the rule. After the first year and on an ongoing basis, the annual cost to the economy is expected to be approximately $30 million. The first-year costs reflect the costs of revising disclosures to include the required statement of the MAPR and the costs of modifying lending systems (if needed) and procedures to take advantage of the optional methods to conduct covered-borrower checks that fit within the safe harbor afforded under § 232.5(b). On an ongoing basis, the costs reflect the costs to creditors of providing the required disclosure—generally, as part of standard form loan agreements—and the costs attributable to the use of the methods for conducting covered-borrower checks described in § 232.5(b).
In the Proposed Rule, the Department sought comment, particularly from potentially affected small businesses themselves, on the possible impact of the Proposed Rule on small businesses. The SBA Office of Advocacy observes that the Department “underestimated the number of entities that might be
The SBA Office of Advocacy also suggests that “requiring small entities to check every customer to determine if he or she is a [covered borrower] could become burdensome.”
The final rule—like the Proposed Rule—does not require any business to determine whether a customer is a covered borrower. A creditor may choose to make such a determination in order to obtain the protection of the safe harbor in § 232.5(b); the Department assumes that all creditors, other than creditors who offer only residential mortgage loans or loans expressly to finance the purchase of personal property (neither of which loans is consumer credit), will establish a procedure to determine whether a particular customer is a covered borrower.
The Department believes that setting up the process to use information obtained from the MLA Database or using information in a consumer report obtained from a nationwide consumer reporting agency, as well as to timely create and maintain a record of that information will take each creditor 70 hours of labor time. The actual cost for each creditor will depend on that entity's business decisions and operations. For example, if nationwide consumer reporting agencies incorporate covered-borrower indicators into consumer reports, a creditor that already obtains a consumer report during the credit origination process might choose to use that indicator to conduct a covered-borrower check, and keep a record of that indicator, pursuant to § 232.5(b). Another creditor, particularly one that does not already obtain consumer reports from a nationwide consumer reporting agency, may instead choose to use information obtained from the MLA Database, and keep a record of that indicator, pursuant to § 232.5(b). And a third creditor, particularly one that offers credit products that comply with the limitation under the MLA, may, as expressly permitted in § 232.5(a), choose to forgo the use of a covered-borrower check described in § 232.5(b).
Nonetheless, assuming that each of the approximately 37,500 creditors subject to the regulation establishes a process to conduct covered-borrower checks through a method provided in § 232.5(b), and that each creditor will incur 70 hours of labor time in doing so, the Department estimates that the total costs relating to setting up the processes for one of those methods would be $84.02 million.
The Department also recognizes that certain costs may be particular to the type of creditor and practices in that market. For example, the National Pawnbrokers Associations shares the report of one member estimating that as many as 4,000 pawn stores across the country do not have computers and would, therefore, need to purchase such equipment in order to take advantage of the safe harbor in § 232.5.
On an ongoing basis, the Department estimates that using information obtained from the MLA Database will add approximately 60 seconds to each new consumer credit transaction.
While a substantial portion of firms in each affected market are “small business entities,” Service members and their dependents make up only a small portion of the consumers for those businesses. Because only approximately 2.5 percent of households in the United States include an active duty Service member, the interest-rate limit and other MLA conditions of the final rule would affect a small percentage of the consumers served by entities that could be creditors covered by this final rule.
The final rule contains information-collection requirements and has been submitted to OMB under the provisions of the Paperwork Reduction Act.
Executive Order 13132 (“E.O. 13132”) requires Executive departments and agencies, including the Department, to identify regulatory actions that have significant federalism implications. A regulation has federalism implications if it has substantial direct effects on the States, on the relationship or distribution of power between the Federal Government and the States, or on the distribution of power and responsibilities among various levels of government.
The provisions of this part, as required by 10 U.S.C. 987, override state statutes inconsistent with this part to the extent that these provisions provide different protections for covered borrowers than those provided to residents of that State. As discussed in the section-by-section description of the final rule, in sections III and IV, the rule revises the corresponding section of the Department's existing rule to reflect amendments to 10 U.S.C. 987(d)(2) enacted in section 661(a)(1) of the 2013 Act. This amendment clarifies the scope of state laws subject to preemption by 10 U.S.C. 987.
The final rule does not affect in any manner the powers and authorities that any State may have or affect the distribution of power and responsibilities between Federal and State levels of government. Therefore, the Department determines that the final rule does not have any federalism implications that warrant the preparation of a Federalism Assessment in accordance with E.O. 13132.
Loan programs, Reporting and recordkeeping requirements, Service members.
For the reasons set forth in the preamble, chapter I of title 32, Code of Federal Regulations is amended by revising part 232 to read as follows:
10 U.S.C. 987.
(a)
(b)
(c)
(1) Provides the maximum allowable amount of all charges, and the types of charges, that may be associated with a covered extension of consumer credit;
(2) Requires a creditor to provide to a covered borrower a statement of the Military Annual Percentage Rate, or MAPR, before or at the time the borrower becomes obligated on the transaction or establishes an account for the consumer credit. The statement required by § 232.6(a)(1) differs from and is in addition to the disclosures that must be provided to consumers under the Truth in Lending Act;
(3) Provides for the method a creditor must use in calculating the MAPR; and
(4) Contains such other criteria and limitations as the Secretary of Defense has determined appropriate, consistent with the provisions of 10 U.S.C. 987.
(a)(1)
(2)
(ii)
(b)
As used in this part:
(a)
(b)
(c)
(d)
(e)
(f)(1)
(i) Subject to a finance charge; or
(ii) Payable by a written agreement in more than four installments.
(2)
(i) A residential mortgage, which is any credit transaction secured by an interest in a dwelling, including a transaction to finance the purchase or initial construction of the dwelling, any refinance transaction, home equity loan or line of credit, or reverse mortgage;
(ii) Any credit transaction that is expressly intended to finance the purchase of a motor vehicle when the credit is secured by the vehicle being purchased;
(iii) Any credit transaction that is expressly intended to finance the purchase of personal property when the credit is secured by the property being purchased;
(iv) Any credit transaction that is an exempt transaction for the purposes of Regulation Z (other than a transaction exempt under 12 CFR 1026.29) or otherwise is not subject to disclosure requirements under Regulation Z; and
(v) Any credit transaction or account for credit for which a creditor determines that a consumer is not a covered borrower by using a method and by complying with the recordkeeping requirement set forth in § 232.5(b).
(g)(1)
(2) The term “covered member” means a member of the armed forces who is serving on—
(i) Active duty pursuant to title 10, title 14, or title 32, United States Code, under a call or order that does not specify a period of 30 days or fewer; or
(ii) Active Guard and Reserve duty, as that term is defined in 10 U.S.C. 101(d)(6).
(3) The term “dependent” with respect to a covered member means a person described in subparagraph (A), (D), (E), or (I) of 10 U.S.C. 1072(2).
(4) Notwithstanding paragraph (g)(1) of this section, covered borrower does not mean a consumer who (though a covered borrower at the time he or she became obligated on a consumer credit transaction or established an account for consumer credit) no longer is a covered member (as defined in paragraph (g)(2) of this section) or a dependent (as defined in paragraph (g)(2) of this section) of a covered member.
(h)
(i)
(1) Engaged in the business of extending consumer credit; or
(2) An assignee of a person described in paragraph (i)(1) of this section with respect to any consumer credit extended.
(3) For the purposes of this definition, a creditor is engaged in the business of extending consumer credit if the creditor considered by itself and together with its affiliates meets the transaction standard for a “creditor” under Regulation Z with respect to extensions of consumer credit to covered borrowers.
(j)
(k)
(
(m)
(n)
(o)
(p)
(q)
(r)
(s)
(t)
(1) Subject to and made in accordance with a Federal law (other than 10 U.S.C. 987) that expressly limits the rate of interest that a Federal credit union or an insured depository institution may charge on an extension of credit, provided that the limitation set forth in that law is comparable to a limitation of an annual percentage rate of interest of 36 percent; and
(2) Made in accordance with the requirements, terms, and conditions of a rule, prescribed by the appropriate Federal regulatory agency (or jointly by such agencies), that implements the Federal law described in paragraph (t)(1) of this section, provided further that such law or rule contains—
(i) A fixed numerical limit on the maximum maturity term, which term shall not exceed 9 months; and
(ii) A fixed numerical limit on any application fee that may be charged to a consumer who applies for such closed-end loan.
(a)
(1) Agreed to under the terms of the credit agreement or promissory note;
(2) Authorized by applicable State or Federal law; and
(3) Not specifically prohibited by this part.
(b)
(c)
(i) Any credit insurance premium or fee, any charge for single premium credit insurance, any fee for a debt cancellation contract, or any fee for a debt suspension agreement;
(ii) Any fee for a credit-related ancillary product sold in connection with the credit transaction for closed-end credit or an account for open-end credit; and
(iii) Except for a bona fide fee (other than a periodic rate) which may be excluded under paragraph (d) of this section:
(A) Finance charges associated with the consumer credit;
(B) Any application fee charged to a covered borrower who applies for consumer credit, other than an application fee charged by a Federal credit union or an insured depository institution when making a short-term, small amount loan, provided that the application fee is charged to the covered borrower not more than once in any rolling 12-month period; and
(C) Any fee imposed for participation in any plan or arrangement for consumer credit, subject to paragraph (c)(2)(ii)(B) of this section.
(iv)
(2)
(ii)
(B)
(d)
(2)
(i) Any credit insurance premium or fee, including any charge for single premium credit insurance, any fee for a debt cancellation contract, or any fee for a debt suspension agreement; or
(ii) Any fee for a credit-related ancillary product sold in connection with the credit transaction for closed-end credit or an account for open-end credit.
(3)
(ii)
(iii)
(iv)
(4)
(ii)
(iii)
(B) In a credit card account under an open-end (not home-secured) consumer credit plan during a given billing cycle, Creditor B imposes on a covered borrower a fee for a debt cancellation product (as described in paragraph (c)(1)(i) of this section), a finance charge (as described in paragraph (c)(1)(iii)(A)), a bona fide foreign transaction fee that qualifies for the exclusion under this paragraph (d), and a bona fide, but unreasonable cash advance fee. All of the fees—including the foreign transaction fee that otherwise would qualify for the exclusion under this paragraph (d)—and the finance charge must be included when calculating the MAPR.
(5)
(a)
(b)
(2)
(B)
(ii)
(3)
(i) A consumer initiates the transaction or 30 days prior to that time;
(ii) A consumer applies to establish the account or 30 days prior to that time; or
(iii) The creditor develops or processes, with respect to a consumer, a firm offer of credit that (among the criteria used by the creditor for the offer) includes the status of the
(a)
(1) A statement of the MAPR applicable to the extension of consumer credit;
(2) Any disclosure required by Regulation Z, which shall be provided only in accordance with the requirements of Regulation Z that apply to that disclosure; and
(3) A clear description of the payment obligation of the covered borrower, as applicable. A payment schedule (in the case of closed-end credit) or account-opening disclosure (in the case of open-end credit) provided pursuant to paragraph (a)(2) of this section satisfies this requirement.
(b)
(2)
(c)
(2)
(3)
(d)
(2)
(ii)
(A) The information to the covered borrower in person; or
(B) A toll-free telephone number in order to deliver the oral disclosures to a covered borrower when the covered borrower contacts the creditor for this purpose.
(iii)
(A) A form the creditor directs the consumer to use to apply for the transaction or account involving consumer credit; or
(B) A written disclosure the creditor provides to the covered borrower, pursuant to paragraph (d)(1) of this section.
(e)
(a)
(b)
(1) Authorize creditors to charge covered borrowers rates of interest for any consumer credit or loans that are higher than the legal limit for residents of the State, or
(2) Permit the violation or waiver of any State consumer lending protection covering consumer credit that is for the benefit of residents of the State on the basis of the covered borrower's nonresident or military status, regardless of the covered borrower's domicile or permanent home of record, provided that the protection would otherwise apply to the covered borrower.
Title 10 U.S.C. 987 makes it unlawful for any creditor to extend consumer credit to a covered borrower with respect to which:
(a) The creditor rolls over, renews, repays, refinances, or consolidates any consumer credit extended to the covered borrower by the same creditor with the proceeds of other consumer credit extended by that creditor to the same covered borrower. This paragraph shall not apply to a transaction when the same creditor extends consumer credit to a covered borrower to refinance or renew an extension of credit that was not covered by this paragraph because the consumer was not a covered borrower at the time of the original transaction. For the purposes of this paragraph, the term “creditor” means a person engaged in the business of
(b) The covered borrower is required to waive the covered borrower's right to legal recourse under any otherwise applicable provision of State or Federal law, including any provision of the Servicemembers Civil Relief Act (50 U.S.C. App. 501
(c) The creditor requires the covered borrower to submit to arbitration or imposes other onerous legal notice provisions in the case of a dispute.
(d) The creditor demands unreasonable notice from the covered borrower as a condition for legal action.
(e) The creditor uses a check or other method of access to a deposit, savings, or other financial account maintained by the covered borrower, except that, in connection with a consumer credit transaction with an MAPR consistent with § 232.4(b), the creditor may:
(1) Require an electronic fund transfer to repay a consumer credit transaction, unless otherwise prohibited by law;
(2) Require direct deposit of the consumer's salary as a condition of eligibility for consumer credit, unless otherwise prohibited by law; or
(3) If not otherwise prohibited by applicable law, take a security interest in funds deposited after the extension of credit in an account established in connection with the consumer credit transaction.
(f) The creditor uses the title of a vehicle as security for the obligation involving the consumer credit,
(g) The creditor requires as a condition for the extension of consumer credit that the covered borrower establish an allotment to repay the obligation. For the purposes of this paragraph only, the term “creditor” shall not include a “military welfare society,” as defined in 10 U.S.C. 1033(b)(2), or a “service relief society,” as defined in 37 U.S.C. 1007(h)(4).
(h) The covered borrower is prohibited from prepaying the consumer credit or is charged a penalty fee for prepaying all or part of the consumer credit.
(a)
(b)
(c)
(d)
(e)
(i) Any actual damage sustained as a result, but not less than $500 for each violation;
(ii) Appropriate punitive damages;
(iii) Appropriate equitable or declaratory relief; and
(iv) Any other relief provided by law.
(2)
(3)
(4)
(5)
(i) Two years after the date of discovery by the plaintiff of the violation that is the basis for such liability; or
(ii) Five years after the date on which the violation that is the basis for such liability occurs.
The provisions of this part, other than § 232.9(a), shall be enforced by the agencies specified in section 108 of the Truth in Lending Act (15 U.S.C. 1607) in the manner set forth in that section or under any other applicable authorities available to such agencies by law.
Nothing in this part may be construed to limit or otherwise affect the applicability of section 207 and any other provisions of the Servicemembers Civil Relief Act (50 U.S.C. App. 527).
(a)
(b)
(c)
(d)
(e)
(a)
(b)
(2)
(c)
(2)
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
| Publisher | Office of the Federal Register, National Archives and Records Administration |