Federal Register Vol. 80, No.179,

On December 19, 2014, the Office of Management and Budget (OMB) published an interim final rule that implemented for all Federal award-making agencies, including NEH, OMB's final guidance on Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. 79 FR 75871. OMB published the uniform rules as 2 CFR part 200. As part of that rulemaking, NEH adopted part 200 through an agency-specific addendum at 2 CFR part 3374. NEH removed and reserved its prior regulations about administrative requirements for Federal awards, 45 CFR part 1174, which were rendered obsolete by the new provisions.

NEH received no comments in response to its adoption of the interim final rule. Therefore, 2 CFR part 3374 as described in the interim final rule, is adopted with no changes.

For the regulatory findings regarding this rulemaking, please refer to the analysis prepared by OMB in the interim final rule, which is incorporated herein by reference. 79 FR at 75876.

Accordingly, the interim rule adding 2 CFR part 3374 and amending 45 CFR part 1174, which was published at 79 FR 75871 on December 19, 2014, is adopted as a final rule without change.

Discussion

We issued a notice of proposed rulemaking (NPRM) to amend 14 CFR part 39 by adding an AD that would apply to all The Boeing Company Model 757 airplanes. The NPRM published in the Federal Register on March 5, 2014 (79 FR 12431). The NPRM was prompted by reports of latently failed fuel shutoff valves discovered during fuel filter replacement. The NPRM proposed to require revising the maintenance or inspection program to include new airworthiness limitations. We are issuing this AD to detect and correct latent failures of the fuel shutoff valve to the engine and APU, which could result in the inability to shut off fuel to the engine and APU and, in case of certain fires, an uncontrollable fire that could lead to structural failure.

In preparation of AD actions such as NPRMs and immediately adopted rules, it is the practice of the FAA to obtain technical information and information on operational and economic impacts from design approval holders and aircraft operators. We discussed certain comments addressed in this final rule in a teleconference with Airlines for America (A4A) and other members of the aviation industry. All of the comments discussed during this teleconference are addressed in this final rule in response to comments submitted by other commenters. A discussion of this contact can be found in the rulemaking docket at http://www.regulations.gov by searching for and locating Docket No. FAA-2014-0126.

Throughout the preamble of this final rule, commenters may have used the terms “fuel shutoff valve” and “fuel spar valve” interchangeably. Both terms refer to the same part. In our responses to comments, we have used the term “fuel shutoff valve.” The term “fuel spar valve” is more commonly used in airplane maintenance documentation and, therefore, we have used that term in figure 1 to paragraph (g) of this AD.

We gave the public the opportunity to participate in developing this AD. The following presents the comments received on the NPRM (79 FR 12431, March 5, 2014) and the FAA's response to each comment.

American Airlines (AA) stated that Boeing's internal review found that the issue addressed by the NPRM (79 FR 12431, March 5, 2014) is not a safety concern, and that Boeing has not recommended any interim action on this issue. In addition, AA stated that Boeing is addressing the issue in the long term with a design change to the motor-operated valve (MOV) actuator of the fuel shutoff valve. AA also noted that in a previous NPRM for Model 757 airplanes, it had submitted data showing the failure of the actuator was unlikely and that coupled with the likelihood of an erroneous indication occurring at the same time, the latent hazard was even more improbable. AA stated the same analysis applies to this NPRM. We infer that AA is requesting the NPRM be withdrawn.

We disagree with AA's request to withdraw the NPRM (79 FR 12431, March 5, 2014). We have determined that an unsafe condition exists that warrants an interim action until the manufacturer finishes developing a modification that will address the identified unsafe condition. Boeing did not formally comment on whether it considers this issue to be an unsafe condition. We have determined that, without the required interim actions, a significant number of flights with a fuel shutoff valve actuator that is failed latently in the open valve position will occur during the affected fleet life. With a failed fuel shutoff valve, if certain fire conditions were to occur, or if extreme engine or APU damage were to occur, or if an engine separation event were to occur during flight, the crew procedures for such an event would not stop the fuel flow to the engine strut and nacelle or APU. The continued flow of fuel could cause an uncontrolled fire or lead to a fuel exhaustion event.

The FAA regulations require all transport airplanes to be fail safe with respect to engine or APU fire events, and the risk due to severe engine or APU damage events be minimized. Therefore, we require, for each flight, sufficiently operative fire safety systems so that fires can be detected and contained, and fuel to the engine strut and nacelle or APU can be shut off in the event of an engine or APU fire or severe damage.

The FAA airworthiness standards require remotely controlled powerplant valves to provide indications that the valves are in the commanded position. These indications allow the prompt detection and correction of valve failures. We do not allow dispatch with a known inoperative fuel shutoff valve. Therefore, we are proceeding with the final rule—not because of the higher-than-typical failure rate of the particular valve actuator involved, but instead because the fuel shutoff valve actuator can fail in a manner that also defeats the required valve position indication feature. That failure can lead to a large number of flights occurring on an airplane with a fuel shutoff valve actuator failed in the open position without the operator being aware of the failure. Airworthiness limitations containing required inspections are intended to limit the number of flights following latent failure of the fuel shutoff valve. Issuance of an AD is the appropriate method to correct the unsafe condition. We have not changed this final rule in this regard.

DHL and United Airlines (UAL) requested that we revise the proposed AD (79 FR 12431, March 5, 2014) to limit the applicability specified in figure 1 and figure 2 to paragraph (g) of the proposed AD to airplanes with fuel shutoff valve actuators on which the identified unsafe condition exists.

DHL stated that the proposed AD (79 FR 12431, March 5, 2014) should make it clear that airworthiness limitations (AWL) numbers 28-AWL-ENG and 28-AWL-APU do not apply to airplanes that are equipped with the actuators made by supplier V35840, having part number (P/N) AV31-1 (Boeing P/N S343T003-111), for the engine fuel shutoff valve and APU fuel shutoff valve. DHL stated that the deficiencies identified in the NPRM are related to potential common mode failures, which affect integral electronic circuit boards that commutate the brushless motor and control the position indicating signals on some actuators made by supplier V73760. DHL also stated that fuel shutoff valve P/N AV31-1 (Boeing P/N S343T003-111) is not susceptible to the type of deficiency described in the NPRM because this valve uses brushes and mechanical switches rather than electronic circuit boards to commutate the motor and to control position indicating signals.

UAL stated that the proposed AD (79 FR 12431, March 5, 2014) did not specify which MOV actuator part number the proposed AD applies to. UAL stated that proposed ADs were issued for Model 737NG, 757, 767, and 777 airplanes to replace the MOV actuator with P/N MA30A1001. UAL also stated there are known issues with this MOV actuator part number, and presumes that the proposed AD is for MOV actuator P/N MA30A1001.

We agree with the commenters' requests to limit the applicability specified in figure 1 and figure 2 to paragraph (g) of this AD to airplanes with the actuators on which the identified unsafe condition exists. Only two fuel shutoff valve actuator designs are susceptible to the identified unsafe condition specified in this final rule, and it would be unnecessarily burdensome to require the inspections on airplanes that do not have any of the susceptible valves installed. We have changed the Applicability column in figure 1 and figure 2 to paragraph (g) of this AD to clarify that the limitations apply to Model 757 airplanes on which fuel shutoff valve actuator P/N MA20A2027 (Boeing P/N S343T003-56) or P/N MA30A1001 (Boeing P/N S343T003-66) is installed at the engine and APU fuel shutoff valve positions.

AA and US Airways requested that the compliance time for the initial accomplishment of the operational check be extended after accomplishing the maintenance or inspection program revision.

AA requested that the compliance time be revised to 60 days after accomplishing the maintenance or inspection program revision. AA stated that the extended time of 60 days is for publishing the new criteria, for distribution of cards and manuals/checklists, and for the initial compliance time to be taken into account. AA stated that the 7-day compliance time is not justified by the failure rates for this safety concern. AA also stated that the compliance deadline would therefore become unclear.

US Airways requested that the compliance time be extended to 7 days after the 30-day compliance time for the maintenance or inspection program revision. US Airways stated that accomplishing the initial compliance time based on completion of adding to the maintenance program would make the compliance deadline very difficult to track as making program changes is typically not a closely tracked process.

We partially agree with the commenters' requests to extend the initial compliance time for the actions specified in figure 1 to paragraph (g) of this AD. We have changed the initial compliance time for accomplishing the actions specified in figure 1 to paragraph (g) of this AD to 10 days. A compliance time of 10 days is consistent with regulatory actions for other affected airplane models and with the initial compliance time in figure 2 to paragraph (g) of this AD. We have determined that the initial compliance time for the check represents an appropriate time in which the required actions can be performed in a timely manner within the affected fleet, while still maintaining an adequate level of safety.

In developing an appropriate compliance time, we considered the safety implications, parts availability, and normal maintenance schedules for timely accomplishment of the operational checks. The manufacturer does not expect a large number of latently failed fuel shutoff valve actuators to be discovered. Existing parts stores are expected to be sufficient, and parts can be repositioned in time to support the initial checks. However, under the provisions of paragraph (i)(1) of this AD, we might consider requests for adjustments to the compliance time if data are submitted to substantiate that such an adjustment would provide an acceptable level of safety.

US Airways requested that the compliance time intervals be changed to specify flight cycles. US Airways stated that it has heard of no evidence suggesting the subject condition is a function of time and believes the condition would likely only occur either at engine or APU start or shutdown. US Airways also stated that it and other operators utilize its airplanes on long-haul trips that span many time zones. US Airways stated that, according to a report from the airplane manufacturer during the fourth quarter of 2013, 68 percent of the operators had a daily utilization rate of 3.3 flight cycles, and 95.4 percent had a daily utilization rate of 4.7 flight cycles.

We disagree with the commenter's request. While the failure of the fuel shutoff valve is likely associated with the cycling of the valve, the purpose of the inspections is to minimize the exposure to flights that are initiated with a fuel shutoff valve actuator that is latently failed in the open position. Operators may request approval of an AMOC in accordance with the provisions specified in paragraph (i)(1) of this AD to change the interval to a cycle-based interval, provided it includes at least one check each day for the engine fuel shutoff valves and that the data substantiate that the request would provide an acceptable level of safety. We have not changed this AD in this regard.

AA and UAL requested that the daily repetitive inspection interval for the engine fuel spar valve be extended.

AA requested that we add a choice to the proposed AD (79 FR 12431, March 5, 2014) to allow monitoring the disagreement light in combination with checking the actuator itself every 100 flight hours or 50 flight cycles, whichever occurs later. AA stated that this means to check the indication and physically check the closure of the engine and APU fuel spar valve at 100 flight hours or 50 flight cycles, whichever occurs later, as an alternative maintenance task. AA stated that Model 767-400 series airplanes identified in the NPRM having Directorate Identifier 2013-NM-237-AD (79 FR 12420, March 5, 2014) are allowed 10 days to inspect the spar valve actuator arm when it is fully closed and commanded closed. AA stated that 10 days equates closely to 100 flight hours/50 flight cycles. AA also stated that Model 757 and 767 airplanes have the same actuator valve and indication, except that Model 767-400 series airplanes do not have a disagreement light.

UAL requested that we extend the daily interval for AWL number 28-AWL-ENG to 10 days. UAL stated that Model 757-200 and -300 series airplanes and Model 767-400 series airplanes use the same MOV actuator. UAL stated that the interval for Model 757-200 and -300 series airplanes is daily while the Model 767-400 series airplanes is 10 days.

We disagree with the commenters' requests. For the engine fuel shutoff valve, an interval increase from daily to every 10 days, or to the later of 100 flight hours or 50 flight cycles, would result in at least 10 times as many flights at risk of an uncontrollable engine fire. The daily check has been deemed practical because in practice it likely means the flightcrew will need to watch a light just above the FUEL CONTROL switch as they start or shut down the engine. As AA stated, Model 767-400ER series airplanes do not have the disagreement light, so the inspection is more complex. As a result, we determined it is not practical to require this inspection on a daily basis on Model 767-400ER airplanes. We have not changed the inspection interval for Model 757 airplanes addressed in this AD.

AA requested that any recurring interval include only the days or flight cycles when the airplane is in revenue service, or when an APU is in operational status. AA stated that the proposed AD (79 FR 12431, March 5, 2014) does not account for airplanes in routine maintenance or in an out-of-service condition. AA also proposed that a provision for the APU on the minimum equipment list (MEL) be included in the proposed AD. AA stated that once an APU is returned to service from the MEL, the “10 day or 100 flight hours/50 cycles whichever occurs later” interval would be restarted. AA stated that any task interval in the proposed AD should have the mechanism to exclude the elapsed time when the aircraft or APU is non-operational, since the latent failure finding task is not accumulating time toward a next potential latent failure.

We partially agree with the commenter's request. We agree to limit operational checks to days when the airplane is in revenue service or when an APU is in operational status because it would be unnecessarily burdensome to require the inspections on airplanes that are not in operation. We have added a note in the Interval column of figure 1 and figure 2 to paragraph (g) of this AD indicating that the operational check for the engine and APU is not required on days when the airplane is not used in revenue service. We have revised figure 1 to paragraph (g) of this AD to include a note stating that the check must be done before further flight once the airplane is returned to revenue service. We have also revised figure 2 to paragraph (g) of this AD to state that the check must be done before further flight with an operational APU if it has been 10 or more calendar days since the last check.

However, we disagree with restarting the 10-day interval once an APU is returned to service. The interval for the operational check of the APU fuel shutoff valve should not be extended simply because the APU was out of service for a time. It is likely that this check will be done as a matter of course whenever an APU is returned to service.

UAL requested that we add a requirement to the proposed AD (79 FR 12431, March 5, 2014) to provide electrical power before performing the operational check required by figure 1 and figure 2 to paragraph (g) of the proposed AD. UAL stated that electrical power is required to perform the check and other maintenance might be underway, which could deactivate required circuits.

We agree with the commenter's request because electrical power is required. In item C.1. of figure 1 and item A.2. of figure 2 to paragraph (g) of this AD, we have added an instruction to supply electrical power to the airplane using standard practices when performing the operational check.

Allegiant Air requested the proposed verbiage that states “(unless checked by the flightcrew in a manner approved by the principle [sic] operations inspector)” be revised to “the operational check can be performed either as a maintenance action or as a flightcrew action.” Allegiant Air stated that the proposed AD (79 FR 12431, March 5, 2014) allows either the flightcrew or maintenance crew to perform the operational check. Allegiant Air stated that section 91.403(c) of the Federal Aviation Regulations (14 CFR 91.403(c)) requires the affected operator to accomplish the test provided by the airworthiness limitation. Allegiant Air also stated that FAA Master Minimum Equipment List (MMEL), Policy Letter 25, Revision 16, dated April 2, 2010 (PL-25 is designated as MMEL Global Change GC-164) (http://fsims.faa.gov/wdocs/policy%20letters/pl-025_r16.htm) provides allowance for “other personnel” to be qualified and authorized to perform certain functions that do not require the use of tools or test equipment. Allegiant Air stated that this change would eliminate the need for a second approval process (via the POI), while providing an equivalent level of safety.

We partially agree with the commenter's request. We agree that the AWL allows either the flightcrew or maintenance crew to perform the operational check. We consider it to be very important that the expectations as to what must be done to check the operation of the fuel shutoff valve, as defined in figures 1 and 2 to paragraph (g) of this AD, be well understood by all parties, and yet we want to provide the maximum flexibility to operators.

If an operator chooses to have the flightcrew accomplish the check, the POI is in the best position to make sure this check is done properly. However, it is also acceptable for an operator to choose to accomplish the check as a maintenance action and record compliance as specified in section 43.11(a) of the Federal Aviation Regulations (14 CFR 43.11(a)) without POI involvement. In addition, affected operators may apply for approval of an AMOC in accordance with the provisions specified in paragraph (i)(1) of this AD by submitting data substantiating that the request would provide an acceptable level of safety. We have not changed the AD in this regard.

US Airways requested clarification on the use of the MEL. US Airways asked if operators may still apply the MEL and be in compliance with the requirements of the proposed AD (79 FR 12431, March 5, 2014) if the SPAR VALVE light becomes inoperative. US Airways stated the maintenance action specified by the MEL should meet the intent of the proposed AD (79 FR 12431, March 5, 2014). US Airways stated that the operational checks in figure 1 to paragraph (g) of the proposed AD are predicated on the SPAR VALVE light being operative. US Airways also stated that MEL 28-40-2 of the FAA Boeing B757 Master Minimum Equipment List (MMEL), Revision 30a, dated June 9, 2014, provides relief should the indication be inoperative, and the proposed AD requirements should provide the same relief.

We disagree with providing MEL relief for an inoperative fuel shutoff valve indication because MEL relief could potentially allow the fuel shutoff valve to be inoperative for up to 10 days of revenue operation. However, we do agree to provide flexibility in regard to verification that the fuel shutoff valve actuator is operational. In figure 1 to paragraph (g) of this AD, we have added item D., “Perform an Inspection to the Fuel Spar Valve MOV Actuator Position,” to verify the valve is closing, which can be used when the fuel shutoff valve indication does not function properly.

US Airways requested that we provide a more complete explanation of the requirements regarding the documentation of accomplishment of the requirements of the proposed AD (79 FR 12431, March 5, 2014). US Airways stated that typically, AD-mandated actions require documentation of accomplishment. US Airways stated that it should be made clear whether logbook entries would be required should the flightcrew perform the required actions in an approved manner, such as part of a procedure checklist.

We agree that clarification is necessary. This AD requires including the information in figure 1 and figure 2 of paragraph (g) of the AD in the maintenance or inspection program. However, the AD does not require accomplishing the actions specified in figure 1 and figure 2 of paragraph (g) of the AD. The actions specified in the figures in this AD are done, and remain enforceable, as part of the airworthiness limitations of the Instructions for Continued Airworthiness. Section 43.11(a) of the Federal Aviation Regulations (14 CFR 43.11(a)) requires maintenance record entries for maintenance actions such as the required checks. If an operator elects to have a flightcrew member do the check in accordance with the applicable airworthiness limitation, that same action would be considered an operational task (not maintenance), and therefore 14 CFR 43.11(a) would not apply. In that case, operators should follow their normal processes for operational activities, including necessary POI involvement. We have not changed this AD in this regard.

UAL requested that we clarify certain requirements of the proposed AD (79 FR 12431, March 5, 2014). UAL stated that, in figure 1 to paragraph (g) of the proposed AD, item C.5.a. and item C.6.a. (item C.6.a. and item C.7.a., respectively, in this AD) instruct to move the left and right FUEL CONTROL switches, respectively, to the RUN position, but do not instruct to monitor the left and right SPAR VALVE disagreement lights, unlike item C.5.c and item C.6.c. of the proposed AD. UAL stated that it presumes it is not required to verify the left and right SPAR VALVE disagreement lights when the left and right FUEL CONTROL switches are moved to the RUN position.

We agree to provide clarification. It is not required to verify the left and right SPAR VALVE disagreement lights when the left and right FUEL CONTROL switches are moved to the RUN position during that portion of the operational check. We have not changed this AD in this regard.

The model designation for The Boeing Company Model 757 airplanes is missing from the SUMMARY section of the NPRM (79 FR 12431, March 5, 2014). This information has been added to this final rule.

We reviewed the relevant data, considered the comments received, and determined that air safety and the public interest require adopting this AD with the changes described previously, and minor editorial changes. We have determined that these minor changes:

• Are consistent with the intent that was proposed in the NPRM (79 FR 12431, March 5, 2014) for correcting the unsafe condition; and

• Do not add any additional burden upon the public than was already proposed in the NPRM (79 FR 12431, March 5, 2014).

We also determined that these changes will not increase the economic burden on any operator or increase the scope of this AD.

We consider this AD interim action. The manufacturer is currently developing a modification that will address the unsafe condition identified in this AD. Once this modification is developed, approved, and available, we might consider additional rulemaking.

We estimate that this AD affects 590 airplanes of U.S. registry.

We estimate the following costs to comply with this AD:

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

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

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

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

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

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

(3) Will not affect intrastate aviation in Alaska, and

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

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

We issued a notice of proposed rulemaking (NPRM) to amend 14 CFR part 39 by adding an AD that would apply to all The Boeing Company Model 767 airplanes. The NPRM published in the Federal Register on March 5, 2014 (79 FR 12420). The NPRM was prompted by reports of latently failed fuel shutoff valves discovered during fuel filter replacement. The NPRM proposed to require revising the maintenance or inspection program to include new airworthiness limitations. We are issuing this AD to detect and correct latent failures of the fuel shutoff valve to the engine and APU, which could result in the inability to shut off fuel to the engine and APU and, in case of certain fires, an uncontrollable fire that could lead to structural failure.

In preparation of AD actions such as NPRMs and immediately adopted rules, it is the practice of the FAA to obtain technical information and information on operational and economic impacts from design approval holders and aircraft operators. We discussed certain comments addressed in this final rule in a teleconference with Airlines for America (A4A) and other members of the aviation industry. All of the comments discussed during this teleconference are addressed in this final rule in response to comments submitted by other commenters. A discussion of this contact can be found in the rulemaking docket at http://www.regulations.gov by searching for and locating Docket No. FAA-2014-0127.

Throughout the preamble of this final rule, commenters may have used the terms “fuel shutoff valve” and “fuel spar valve” interchangeably. Both terms refer to the same part. In our responses to comments, we have used the term “fuel shutoff valve.” The term “fuel spar valve” is more commonly used in airplane maintenance documentation and, therefore, we have used that term in figure 1 and figure 2 to paragraph (g) of this AD.

We gave the public the opportunity to participate in developing this AD. The following presents the comments received on the NPRM (79 FR 12420, March 5, 2014) and the FAA's response to each comment.

American Airlines (AA) stated that Boeing's internal review found that the issue addressed by the NPRM (79 FR 12420, March 5, 2014) is not a safety concern, and Boeing has not recommended any interim action on this issue. In addition, AA stated that Boeing is addressing the issue in the long term with a design change to the motor-operated valve (MOV) actuator of the fuel shutoff valve.

All Nippon Airways (ANA) stated it agrees with a statement in “767-FTD-28-12003 issued by Boeing” indicating that the combination of the events (engine fire and spar valve failures) is extremely improbable. ANA requested clarification of the rationale for the proposed intervals. ANA stated that it has operated more than 100 Model 767 airplanes for approximately 30 years and has never had such failure with the MOVs.

We infer that AA and ANA requested that the NPRM (79 FR 12420, March 5, 2014) be withdrawn.

We disagree with the commenters' request to withdraw the NPRM (79 FR 12420, March 5, 2014). We have determined that an unsafe condition exists that warrants an interim action until the manufacturer finishes developing a modification that will address the identified unsafe condition. Boeing did not formally comment on whether it considers this issue to be an unsafe condition. We have determined that, without the required interim actions, a significant number of flights with a fuel shutoff valve actuator that is failed latently in the open valve position will occur during the affected fleet life. With a failed fuel shutoff valve, if certain fire conditions were to occur, or if extreme engine or APU damage were to occur, or if an engine separation event were to occur during flight, the crew procedures for such an event would not stop the fuel flow to the engine strut and nacelle or APU. The continued flow of fuel could cause an uncontrolled fire or lead to a fuel exhaustion event.

The FAA regulations require all transport airplanes to be fail safe with respect to engine or APU fire events, and the risk due to severe engine or APU damage events to be minimized. Therefore, we require, for each flight, sufficiently operative fire safety systems so that fires can be detected and contained, and fuel to the engine strut and nacelle or APU can be shut off in the event of an engine or APU fire or severe damage.

The FAA airworthiness standards require remotely controlled powerplant valves to provide indications that the valves are in the commanded position. These indications allow the prompt detection and correction of valve failures. We do not allow dispatch with a known inoperative fuel shutoff valve. Therefore, we are proceeding with the final rule—not because of the higher-than-typical failure rate of the particular valve actuator involved, but instead because the fuel shutoff valve actuator can fail in a manner that also defeats the required valve position indication feature. That failure can lead to a large number of flights occurring on an airplane with a fuel shutoff valve actuator failed in the open position without the operator being aware of the failure. Airworthiness limitations containing required inspections are intended to limit the number of flights following latent failure of the fuel shutoff valve. Issuance of an AD is the appropriate method to correct the unsafe condition. We have not changed this final rule in this regard.

Delta Airlines (DAL) and United Airlines (UAL) requested that we revise the proposed AD (79 FR 12420, March 5, 2014) to limit the applicability specified in figure 1, figure 2, and figure 3 to paragraph (g) of the proposed AD to airplanes with fuel shutoff valve actuators on which the identified unsafe condition exists.

DAL stated that it would be feasible to implement configuration control to ensure that part number (P/N) MA30A1001 is removed, and does not get installed in the engine or APU fuel shutoff valve positions in the future. DAL stated it would replace any P/N MA30A1001 actuators that are currently in those locations with actuators of a different acceptable part number, which would, in turn, alleviate the unsafe condition given in the NPRM (79 FR 12420, March 5, 2014). DAL stated that if an operator does not have P/N MA30A1001 installed on any engine or APU fuel shutoff valve positions, then that operator would not be required to adhere to airworthiness limitations 28-AWL-ENG, 28-AWL-MOV, or 28-AWL-APU.

UAL stated that the proposed AD (79 FR 12420, March 5, 2014) does not specify which part number of the MOV actuator is applicable to the proposed AD. UAL stated that proposed ADs were issued for Model 737NG, 757, 767, and 777 airplanes to replace the MOV actuator with P/N MA30A1001. UAL also stated that there are issues with the MOV actuator part number, and presumes that the proposed AD is for MOV actuator P/N MA30A1001.

We agree with the commenters' request. Only two fuel shutoff valve actuator designs are susceptible to the unsafe condition specified in this final rule, and it would be unnecessarily burdensome to require the inspections on airplanes that do not have any of the susceptible valves installed. We have changed the Applicability column in figure 1, figure 2, and figure 3 to paragraph (g) of this AD to clarify that the limitations apply to Model 767 airplanes having fuel shutoff valve actuator P/N MA20A2027 (S343T003-56) or P/N MA30A1001 (S343T003-66) installed at the engine or APU fuel shutoff valve position, as appropriate.

AA requested that the compliance time for the initial accomplishment of the actions specified in figure 1, figure 2, and figure 3 to paragraph (g) of the proposed AD (79 FR 12420, March 5, 2014) be extended from 7 days to 60 days. AA stated that more time is needed for publishing the new criteria and for distribution of cards and manuals/checklists. AA stated that the 7-day compliance time is not justified by the failure rates for this safety concern.

We partially agree with the commenter's request. We have changed the initial compliance time to 10 days for accomplishing the actions specified in figure 1, figure 2, and figure 3 to paragraph (g) of this AD. The compliance time of 10 days is consistent with regulatory actions for other affected models. We have determined that the initial compliance time for the inspection represents an appropriate time in which the required actions can be performed in a timely manner within the affected fleet, while still maintaining an adequate level of safety.

In developing an appropriate compliance time, we considered the safety implications, parts availability, and normal maintenance schedules for timely accomplishment of the operational checks. The operational check procedures and the access procedures are simple and already established. The check itself involves a visual inspection of an existing prominent design feature that is intended to indicate the position of the fuel shutoff valve actuator and is described in existing maintenance documentation. The manufacturer does not expect a large number of latently failed valve actuators to be discovered. Existing parts stores are expected to be sufficient, and parts can be repositioned in time to support the initial inspections. However, under the provisions of paragraph (i)(1) of this AD, we might consider requests for adjustments to the compliance time if data are submitted to substantiate that such an adjustment would provide an acceptable level of safety.

Boeing requested that the proposed requirement to “incorporate the MOV actuator inspection into the Airworthiness Limitations (AWL) Section of the Instructions for Continued Airworthiness of operator's maintenance or inspection programs” be replaced with an AD requirement to perform the MOV inspection per the specific interval in paragraph (g) of the proposed AD (79 FR 12420, March 5, 2014). Boeing stated that the MOV inspection in paragraph (g) of the proposed AD is an interim mitigation until a redesigned MOV can be installed in the spar valve locations. Boeing stated that including the interval requirement as the required AD action would allow installation of the redesigned MOV to be approved as an alternative method of compliance (AMOC) to the AD, and as a terminating action for the repetitive inspections, while avoiding the need for regulatory approval to remove the AWL from each operator's maintenance or inspection program. In addition, Boeing stated the AWLs are permanent actions that affect operators' planning and scheduling, and that incorporating a temporary AWL into the operators' maintenance documents or a Boeing maintenance planning data (MPD) document will cause confusion among operators.

We disagree with the commenter's request. During the development of the NPRM (79 FR 12420, March 5, 2014), we discussed the impact of an AWL revision versus a repetitive inspection requirement with Boeing, who, in turn, discussed it with a sample of operators. At that time, both Boeing and the operators indicated that the addition of an AWL was the preferred solution because it would reduce the record keeping required to document AD compliance. Affected operators who wish to use a repetitive inspection requirement in place of an AWL revision may apply for approval of an AMOC in accordance with the provisions specified in paragraph (i)(1) of this AD by submitting data substantiating that the request would provide an acceptable level of safety. We have not changed this AD in this regard.

UAL asked whether there are any provisions established by the FAA to extend the daily inspection requirement if the reliability data are captured. UAL stated that there is no valid justification for this short time limit that creates a burden on airline operations.

We disagree with the commenter's request. Our unsafe condition determination is primarily driven by the potential for a common-cause failure of the valve and its position indication—and not by a lack of reliability. We are aware that this failure has happened in service, and we expect that tens of thousands of flights will occur with this valve failed in the open position without indicating the failure unless frequent inspections are made. Fortunately, the effort required to check the valve operation is small for most airplanes. For Model 767-200 and -300 series airplanes, we expect that most airlines will have the flightcrew monitor a light near the switch they are using to shut down the engine. The total time needed should be less than a few seconds. In addition, new fuel shutoff valve actuators are being developed that will allow removal of this requirement once they are installed. Therefore, we have no plans to extend the interval based on updated reliability data. We have not changed this AD in this regard.

UAL noted there is no provision in the proposed AD (79 FR 12420, March 5, 2014) to allow a waiver of the daily inspection requirements if an airplane is out of service for any reason or in a remote station where the daily inspection cannot be accomplished. Air Do asked if the daily check must be done once a day even if the airplane does not have a flight plan. We infer the commenters are requesting that we revise the proposed AD to allow exceptions to the daily check specified in figure 1 to paragraph (g) of the proposed AD.

AA requested that the proposed AD (79 FR 12420, March 5, 2014) be clarified to specify that daily checks only apply when the airplane is in operational revenue service. AA also stated to restart the interval of 10 days or 100 flight hours/50 cycles, whichever occurs later, once an APU is returned to service from the minimum equipment list.

We partially agree with the commenters' requests. We agree to limit inspections to days when the airplane is in revenue service or when the APU is in operational status because it would be unnecessarily burdensome to require the inspections on airplanes that are not in operation. In figure 1, figure 2, and figure 3 to paragraph (g) of this AD, we have added a note in the Interval column to clarify that the operational check is not required on days when the airplane is not used in revenue service. For figure 1 to paragraph (g) of this AD, we also specify that the check of the engine fuel shutoff valve must be done before further flight once the airplane is returned to revenue service. In figure 2 and figure 3 to paragraph (g) of this AD, we have specified that the check or inspection must be done before further flight if it has been 10 or more calendar days since last check or inspection.

We disagree with restarting the 10-day cycle once an APU is returned to service because the APU fuel shutoff valve check should not be extended because the APU was out of service for a time. For the APU, it is likely that this test will be done as a matter of course whenever it is returned to service.

AA, ANA, DAL, and Japan Airlines (JAL) requested that the repetitive interval be extended for the actions specified in figure 1, figure 2, and figure 3 to paragraph (g) of the proposed AD (79 FR 12420, March 5, 2014).

AA requested that the repetitive inspection interval be extended to “10 days or 100 flight hours/50 flight cycles, whichever occurs later.” AA requested that we revise the proposed AD (79 FR 12420, March 5, 2014) to add the choice of monitoring the disagreement light to check the indication and physically check the closure of the valve at “100 flight hours/50 cycles whichever occurs later” as an alternative maintenance task. AA stated that operators of Model 767-400 series airplanes identified in the NPRM are allowed 10 days to inspect the spar valve actuator arm when it is fully closed and commanded closed. AA stated that the 10 days equates closely to “100 flight hours/50 cycles.” AA also stated that Model 767-200, -300, and -400 series airplanes have the same actuator valve and indication, except that Model 767-400 series airplanes do not have a disagreement light.

ANA stated it has reviewed the NPRM (79 FR 12420, March 5, 2014), and is disappointed with the intervals of the operational checks because the intervals are daily for engine fuel spar valves on Boeing Model 767-200, -300, and -300F series airplanes, and 10 days for APU fuel valves; the proposed intervals will definitely affect its operations. ANA stated that it does not have Model 767-400 airplanes, but that the operational effect is the same. ANA suggested a compliance time of “6,000 flight hours or 22 months whichever comes first” for both engine spar valves and APU fuel valves.

DAL stated that Model 767-300 and -400 series airplanes contain similar systems with respect to engine fuel shutoff. DAL stated that Model 767-300 and -400 series airplanes are also equipped with the same part number for the MOV actuator. DAL stated that, therefore, the failure modes between the two airplane models should be identical. DAL stated that since the FAA considers a 10-day interval sufficient for Model 767-400 series airplanes, and also for the APU fuel shutoff actuator for all Model 767 airplanes, it proposes to change the interval in figure 1 to paragraph (g) of this proposed AD to 10 days.

We disagree with the commenters' requests. Increasing the check interval from daily to every 10 days for the AWL task specified in figure 1 to paragraph (g) of this AD would result in 10 times as many flights at risk of an uncontrollable engine fire; the daily check has been deemed practical because in practice it will mean the flightcrew will need to watch a light just above the FUEL CONTROL switch as they start or shut down the engine. As AA stated, Model 767-400ER series airplanes do not have the disagreement light, so the inspection is more complex. As a result, regardless of how desirable a daily inspection would be, we determined it is not practical to require that inspection on a daily basis on Model 767-400ER series airplanes. We have not changed this AD in this regard.

As we discussed previously, the reason for this final rule is not simply a high valve failure rate in the open position, but rather a design error that allows a single failure within a fuel shutoff valve actuator to affect both the control of the valve and the indication of the valve's position. Currently these failures are only discovered during fuel filter changes, which occur every 6,000 flight hours. ANA's proposal is to check the system every 6,000 flight hours. A dedicated inspection every 6,000 flight hours would have little impact on the number of flights at risk. Indication and control of the fuel shutoff valve are not independent because of the design error in the affected valve actuators. For a failed fuel shutoff valve, the valve indication system erroneously reports that the valve is opening and closing. If no action is taken, we anticipate a significant number of flights to occur with a failed open fuel shutoff valve. Without this AD, our risk assessment and the manufacturer's risk assessment predict that tens of thousands of such flights would occur in the fleet of Model 767 airplanes.

In addition to this fuel shutoff valve design error, the affected valves have a higher-than-typical rate of failure in several failure modes. We have received several reports of valves failed open (discovered only when fuel filters were changed), valves failed closed (preventing engine start), and valves that spontaneously closed in flight (causing an engine shutdown). Boeing's long-term solution, a fuel shutoff valve actuator design change, is intended to address these issues in addition to restoring the independence of the actuator control and indication features. The APU, on the other hand, presents a much lower risk and is needed in flight on a small number of flights. In addition, normal APU starting procedures include this check on every start, so it is likely that this check is already being done on a more frequent basis. We have not changed this AD in this regard.

ANA requested that rationale be provided to justify the proposed inspection interval, including the interval differences between the engine and the APU, and the interval between Model 767 and Model 777 airplanes.

We agree to provide the requested rationale. While the potential for the problem is the same for Model 767 and Model 777 airplanes, the ability to check the system functionality is different. Both types of airplanes warrant a daily check, but we also consider the practicality of an inspection. On Model 767-200, -300, and -300F series airplanes, the flightcrew will need to watch the disagreement light located just above the FUEL CONTROL switch as they start or shut down the engine. Model 777 airplanes, like Model 767-400ER series airplanes, do not have a disagreement light so the inspection is more time consuming. As a result, regardless of how desirable a daily inspection would be for Model 777 airplanes, we determined it is not practical to require that inspection on a daily basis.

In regard to the APU, it is not run on every flight, so a properly functioning fuel shutoff valve is not needed for every flight. We decided to require the check every 10 days rather than try to monitor APU usage. Also, it should be noted that this check is part of a normal APU start, so it will likely be done on every start; this AD requires that it be done at least every 10 days. We have not changed this AD in this regard.

UAL requested instructions for compliance with the ETOPS requirement that would meet the operational check requirements. UAL requested that we revise the NPRM (79 FR 12420, March 5, 2014) to clarify whether standardized procedures will be established for inspectors to make approvals for all affected operators. UAL stated that since the affected airplanes have ETOPS approval, the NPRM should provide instructions for compliance with the ETOPS requirements. UAL asked that the FAA provide guidance to the principal operations inspector (POI) on required procedures that would meet the operational check requirements.

We agree that clarification is needed. We infer the commenter means that checks of the left and right engine fuel shutoff valves are done by different individuals due to ETOPS maintenance requirements. Since none of the required inspections include actions that could contribute to an engine shutdown, there is no common-cause engine shutdown potential and, therefore, no need for different individuals to perform the inspections on the left and right fuel shutoff valve actuators to meet ETOPS maintenance requirements. No additional guidance to the POIs is necessary.

DAL requested we expand the inspection at the spar for confirmation of functionality on Model 767-300 series airplanes using the same method of inspection and the same auxiliary power unit position as those for the Boeing Model 767-400 series airplanes. DAL stated that a check of the actual valve position every 10 days would be a more effective inspection. DAL stated that “FTD Article 767-FTD-28-12003” (Boeing Fleet Team Digest) states that, “The indication showed the valve had closed when it had failed in the open position.” DAL stated that the flight deck indication may not accurately reflect functionality.

We partially agree with the commenter's request. We agree to add an inspection option for Model 767-300 airplanes that is similar to the inspection for Model 767-400ER series airplanes. Therefore, for Model 767-200, -300, and -300F series airplanes, we have added item D. to figure 1 to paragraph (g) of this AD to specify a fourth option to perform a daily inspection to verify the fuel shutoff valve is closing. However, we disagree with extending the inspection interval to 10 days. As stated previously, increasing the inspection interval from every day to every 10 days for the AWL task specified in figure 1 to paragraph (g) of this AD would result in 10 times as many flights at risk of an uncontrollable engine fire.

UAL requested that we revise the proposed AD (79 FR 12420, March 5, 2014) to add a requirement to provide electrical power before performing the operational check required by figure 3 to paragraph (g) of the proposed AD. UAL stated that electrical power is required to perform the check, and other maintenance may be done that could deactivate required circuits.

We agree with the commenter's request because electrical power is required. In figure 1 and figure 3 to paragraph (g) of this AD, we have added a requirement to supply electrical power to the airplane using standard practices when performing the operational check.

Air Do stated that, if the flightcrew performed the operational check, the maintenance record is usually not created. The commenter questioned whether this is acceptable, or whether the flightcrew should record it in the flight log.

UAL requested clarification on whether the flightcrew will not have to record compliance for one of the checks and that documentation for each inspection on every airplane need not be made if relying on flightcrew compliance with the proposed AD.

JAL requested that the FAA coordinate with Boeing to include an appropriate check procedure in the Normal Procedure (NP) section of the flightcrew operating manual (FCOM).

We find that clarification is necessary. This AD requires including the information specified in figure 1, figure 2, and figure 3 of paragraph (g) of the AD in the maintenance or inspection program; however, the actions specified in the figures in this AD are accomplished, and remain enforceable, as part of the Airworthiness Limitations of the Instructions for Continued Airworthiness. Section 43.11(a) of the Federal Aviation Regulations (14 CFR 43.11(a)) requires maintenance record entries for maintenance actions such as this inspection. If an operator elects to have a flightcrew member do an inspection in accordance with the applicable airworthiness limitation, that same action would be considered an operational task—not maintenance—and therefore 14 CFR 43.11(a) would not apply. Regarding JAL's comment, an FCOM is a Boeing document that we neither approve nor control. We have not changed this AD with regard to these issues.

UAL requested that we clarify the requirements in figure 1 to paragraph (g) of the proposed AD (79 FR 12420, March 5, 2014). UAL stated that items C.6.a. and C.7.a. of figure 1 to paragraph (g) of the proposed AD instruct to move the L and R FUEL CONTROL switches, respectively, to the RUN position, but do not instruct to monitor the left and right SPAR VALVE disagreement lights, unlike item C.6.c. and item C.7.c. UAL stated that it presumes it is not required to verify the left and right SPAR VALVE disagreement lights when the L and R FUEL CONTROL switches are moved to the RUN position.

We agree to provide clarification. It is not required to verify the left and right SPAR VALVE disagreement lights when the L and R FUEL CONTROL switches are moved to the RUN position during that portion of the operational check. We have not changed this AD in this regard.

First Air requested clarification of the proposed corrective action for an inoperative indication—specifically, whether operators could still apply an MEL maintenance action and meet the intent of the NPRM (79 FR 12420, March 5, 2014). First Air stated that the operational checks in figure 1 to paragraph (g) of the proposed AD for engine spar valves are predicated on the SPAR VALVE light being operative. First Air stated that MEL 28-40-02 provides relief should the indication be inoperative.

We agree that clarification is needed. We disagree with providing MEL relief for an inoperative fuel shutoff valve indication because MEL relief could potentially allow the valve to be inoperative for up to 10 days of revenue operation. However, we do agree to provide flexibility regarding verification that the fuel shutoff valve actuator is operational. We have added item D. to figure 1 to paragraph (g) of this AD to specify a fourth option to perform a daily inspection to verify the fuel shutoff valve is closing, which can be used when the fuel shutoff valve indication does not function properly.

UAL requested that a statement be included in the proposed AD (79 FR 12420, March 5, 2014) to clarify that it is not required to cycle the L and R FUEL CONTROL switches, as specified in Boeing Airplane Maintenance Manual (AMM) 28-22-00, for the ALI task specified in figure 2 to paragraph (g) of the proposed AD.

We agree with the commenter's request. We have added a note in figure 2 to paragraph (g) of this AD stating that it is not necessary to cycle the FUEL CONTROL switch to do the inspection.

UAL requested that a typographical error be corrected in the NPRM (79 FR 12420, March 5, 2014). UAL stated that figure 1 to paragraph (g) of the NPRM states, “Item C.4 instructs to make sure Land R ENG START selector switches on the overhead panel are in the OFF position.” UAL stated that this is a typographical error and the selector switches should be L and R ENG START selector switches.

We agree and have corrected the typographical error in figure 1 to paragraph (g) of this AD accordingly. Paragraph C.4. of figure 1 to paragraph (g) of this AD, as it appeared in the NPRM (79 FR 12420, March 5, 2014), has been re-designated as paragraph C.5. of figure 1 to paragraph (g) of this AD.

In the Description column of figure 2 to paragraph (g) of this AD, we have removed the phrase “refer to Boeing AMM 28-22-00” with regard to performing an inspection of the fuel spar valve MOV actuator position.

In paragraph C.7.a. in the Description column of figure 1 to paragraph (g) of this AD, and in paragraph A.5. in the Description column of figure 3 to paragraph (g) of this AD, we have added wording specifying to wait “approximately” 10 seconds once the FUEL CONTROL switch is in the RUN position or the APU selector switch on the overhead panel is in the ON position.

We reviewed the relevant data, considered the comments received, and determined that air safety and the public interest require adopting this AD with the changes described previously and minor editorial changes. We have determined that these minor changes:

• Are consistent with the intent that was proposed in the NPRM (79 FR 12420, March 5, 2014) for correcting the unsafe condition; and

• Do not add any additional burden upon the public than was already proposed in the NPRM (79 FR 12420, March 5, 2014).

We also determined that these changes will not increase the economic burden on any operator or increase the scope of this AD.

We consider this AD interim action. The manufacturer is currently developing a modification that will address the unsafe condition identified in this AD. Once this modification is developed, approved, and available, we may consider additional rulemaking.

We estimate that this AD affects 450 airplanes of U.S. registry.

We estimate the following costs to comply with this AD:

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

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

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

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

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

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

(3) Will not affect intrastate aviation in Alaska, and

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

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

We issued a notice of proposed rulemaking (NPRM) to amend 14 CFR part 39 by adding an AD that would apply to all The Boeing Company Model 777 airplanes. The NPRM published in the Federal Register on January 10, 2014 (79 FR 1772). The NPRM was prompted by reports of latently failed fuel shutoff valves discovered during fuel filter replacement. The NPRM proposed to require revising the maintenance or inspection program to include a new airworthiness limitation. We are issuing this AD to detect and correct latent failures of the fuel shutoff valve to the engine, which could result in the inability to shut off fuel to the engine and, in case of certain engine fires, an uncontrollable fire that could lead to wing failure.

In preparation of AD actions such as NPRMs and immediately adopted rules, it is the practice of the FAA to obtain technical information and information on operational and economic impacts from design approval holders and aircraft operators. We discussed certain comments addressed in this final rule in a teleconference with Airlines for America (A4A) and other members of the aviation industry. All of the comments discussed during this teleconference that are relevant to this final rule are addressed in this final rule in response to comments submitted by other commenters. A discussion of this contact can be found in the rulemaking docket at http://www.regulations.gov by searching for and locating Docket No. FAA-2013-1071.

Throughout the preamble of this final rule, commenters may have used the terms “fuel shutoff valve” and “fuel spar valve” interchangeably. Both terms refer to the same part. In our responses to comments, we have used the term “fuel shutoff valve.” The term “fuel spar valve” is more commonly used in airplane maintenance documentation and, therefore, we have used that term in figure 1 to paragraph (g) of this AD.

We gave the public the opportunity to participate in developing this AD. The following presents the comments received on the NPRM (79 FR 1772, January 10, 2014) and the FAA's response to each comment.

American Airlines (AA) stated that Boeing's internal review found that the issue addressed by the NPRM (79 FR 1772, January 10, 2014) is not a safety concern, and that Boeing has not recommended any interim action on this issue. In addition, AA stated that Boeing is addressing the issue in the long term with a design change to the motor-operated valve (MOV) actuator. We infer AA is requesting that the NPRM be withdrawn.

We disagree with the commenter's request to withdraw the NPRM (79 FR 1772, January 10, 2014). We have determined that an unsafe condition exists that warrants an interim action until the manufacturer finishes developing a modification that will address the identified unsafe condition. Boeing did not formally comment on whether it considers this issue to be an unsafe condition. We have determined that, without the required interim actions, a significant number of flights with a fuel shutoff valve actuator that is failed latently in the open valve position will occur during the affected fleet life. With a failed fuel shutoff valve, if certain engine fire conditions were to occur, or if extreme engine damage were to occur, or if an engine separation event were to occur during flight, the crew procedures for such an event would not stop the fuel flow to the engine strut and nacelle. The continued flow of fuel could cause an uncontrolled fire or lead to a fuel exhaustion event.

The FAA regulations require all transport airplanes to be fail safe with respect to engine fire events, and the risk due to severe engine damage events be minimized. Therefore, we require, for each flight, sufficiently operative fire safety systems so that fires can be detected and contained, and fuel to the engine strut and nacelle can be shut off in the event of an engine fire or severe damage.

The FAA airworthiness standards require remotely controlled powerplant valves to provide indications that the valves are in the commanded position. These indications allow the prompt detection and correction of valve failures. We do not allow dispatch with a known inoperative fuel shutoff valve. Therefore, we are proceeding with the final rule—not because of the higher-than-typical failure rate of the particular valve actuator involved, but instead because the fuel shutoff valve actuator can fail in a manner that also defeats the required valve position indication feature. That failure can lead to a large number of flights occurring on an airplane with a fuel shutoff valve actuator failed in the open position without the operator being aware of the failure. An airworthiness limitation containing required inspections is intended to limit the number of flights following latent failure of the fuel shutoff valve. Issuance of an AD is the appropriate method to correct the unsafe condition. We have not changed this AD in this regard.

The European Aviation Safety Agency (EASA), which is the Technical Agent for the Member States of the European Union, requested that we revise the NPRM (79 FR 1772, January 10, 2014) to add more details on the frequency of valve failure findings, and the associated root cause driving the proposed weekly inspection interval versus the existing maintenance planning data (MPD) document check interval of 18,000 flight hours.

We agree with EASA's request to provide further clarification. As we mentioned in a previous comment response, the reason for this final rule is not simply a high fuel shutoff valve failure rate, but is rather a design error that allows a single failure within a fuel shutoff valve to affect both the control of the valve and the indication of the valve's position.

The 18,000-hour check in the MPD document was recommended based on the assumption that the indication of the fuel shutoff valve position would not be affected by failures that affect the control of the valve. With the intended design, there was not a potential for a significant number of flights to occur with a fuel shutoff valve failed open (even if the valve was never checked), because the indication system was to provide real-time indication of the valve's response to commands.

With the design error that exists in the affected fuel shutoff valve actuators, indication and control of the valve are not independent, and if no action is taken, we anticipate a significant number of flights to occur with a fuel shutoff valve failed open. Without the issuance of this final rule, our risk assessment and the manufacturer's risk assessment predict that thousands of flights of Model 777 airplanes would be conducted with latent fuel shutoff valve failures.

In addition to the design error described previously, the affected fuel shutoff valves have a higher-than-typical rate of failure in several failure modes. We have received several reports of valves failed open (discovered only when fuel filters were changed), of valves failed closed (preventing engine start), and of valves that spontaneously closed in flight (causing an engine shutdown). Boeing's long-term solution to provide a redesigned MOV actuator is intended to address these issues in addition to restoring the independence of the actuator control and indication features. We have not changed this final rule in this regard.

Singapore Airlines (SIA) requested that the FAA consider delaying the release of the final rule until after the Boeing service information is issued and sufficient model kits are made available. SIA also requested that Boeing provide warranty coverage for the post-modified part replacement and warranty coverage for the man-hours incurred.

We disagree with the commenter's request to postpone releasing the final rule. Because this unsafe condition could exist or develop on Model 777 airplanes, an airworthiness limitation containing repetitive inspections as an interim action is necessary to ensure the safety of the fleet. Issuance of an AD is the appropriate method to correct the unsafe condition.

In addition, the manufacturer does not expect a large number of latently failed valve actuators to be discovered. Existing parts stores are expected to be sufficient, and parts can be repositioned in time to support the initial inspections. A functioning fuel shutoff valve is required at dispatch. This position is consistent with the original determination in developing the master minimum equipment list (MMEL) that dispatch relief is not allowed for fire-safety-related flammable fluid shutoff valves (other than in a locked, closed position for non-required equipment). However, under the provisions of paragraph (i)(1) of this AD, we might consider requests for an adjustment to the compliance time if data are submitted to substantiate that such an adjustment would provide an acceptable level of safety. In regard to providing warranty coverage, we cannot comment on Boeing's behalf on this issue. We have not changed the final rule in this regard.

EASA requested clarification on whether similar designs on other airplanes could exist. EASA stated that this would be the basis for a design review of parts of similar design.

We agree to provide clarification for the commenter. This AD is applicable to certain Model 777 series airplanes only. Similar AD action is planned for Model 737NG, 757, 767, and 787 series airplanes. At this time, our understanding is that no other manufacturer's airplanes are affected by this specific design problem. We have not changed the final rule in this regard.

AA requested that we revise the NPRM (79 FR 1772, January 10, 2014) to include the estimated costs for the repetitive inspections of the MOV actuator of the fuel shutoff valve. AA stated that the cost included in the NPRM does not account for the cost of the ongoing inspections. AA stated that the NPRM reflects only the first inspection. AA also stated that the annual cost of compliance will be 52 times greater, or $839,800, if the inspection is accomplished weekly. AA stated that these costs should be included for operator planning purposes.

We acknowledge the commenter's concern. In this AD, the required action is to revise the maintenance or inspection program, as applicable, to include a new airworthiness limitation. The added airworthiness limitation requires an inspection of the position of the MOV actuator of the fuel shutoff valve every 10 days. However, these repetitive inspections, which are expected to take less than an hour to complete, are required by section 91.403(c) of the Federal Aviation Regulations (14 CFR 91.403(c)) once incorporated into the maintenance or inspection program.

The cost analysis in AD rulemaking actions typically includes only the costs associated with complying with an AD. In this AD, the required action is the maintenance or inspection program revision, as applicable, to include the new airworthiness limitation, and accomplishing repetitive actions that are specified in the airworthiness limitation are not directly required by this AD. The FAA, as a matter of practice, does not include a cost estimate for these repetitive actions in an AD because these actions are required as part of the operating rules. Therefore, we have made no change to this final rule in this regard.

Air France, AA, Boeing, and KLM Royal Dutch Airlines (KLM) requested that the proposed applicability be changed to include only Model 777 airplanes having line numbers 1 through 1164 inclusive.

Air France and KLM stated that Boeing Fleet Team Digest 777-FTD-28-12002, dated January 10, 2014, indicated that airplanes delivered December 2013 or later incorporate AIMS-2 BlockPoint (BP) v 17, which has a new function that avoids latently failed fuel shutoff valves.

Boeing stated that, beginning with line number 1165, all new production airplanes will be delivered with AIMS-2 BP v 17 or later software. Boeing also stated that starting with AIMS-2 BP v 17, all AIMS-2 software versions will include changes to ensure that the correct fuel shutoff valve position is displayed in the flight deck, and that the software will monitor both the valve transition and the end state to ensure the correct position indication.

Boeing also requested that the proposed applicability be limited to Model 777 airplanes with part number (P/N) MA20A2027 (S343T003-56) or P/N MA30A1001 (S343T003-66) actuators installed at the “engine fuel spar valve locations.” Boeing stated that the failure mode exists only in actuators having these part numbers. Boeing stated that actuators having P/N MA20A1001-1 (S343T003-39) might be installed in the “fuel spar valve location,” and that actuators having P/N MA20A1001-1 (S343T003-39) are not susceptible to the latent failure addressed by the NPRM (79 FR 1772, January 10, 2014), and would not benefit from an interval inspection.

We agree that the applicability of this AD should be limited. We have changed paragraph (c) of this AD to include only Model 777 airplanes having line numbers 1 through 1164 inclusive. In addition, in figure 1 to paragraph (g) of this AD, we have changed the Applicability column for Airworthiness Limitation (AWL) 28-AWL-MOV to clarify that the limitation applies to airplanes with the AIMS-1 system having an actuator with P/N MA20A2027 (S343T003-56) or P/N MA30A1001 (S343T003-66) installed at the engine fuel spar valve position; and airplanes with AIMS-2 BP v 16 and earlier software having an actuator with P/N MA20A2027 (S343T003-56) or P/N MA30A1001 (S343T003-66) installed at the engine fuel spar valve position.

AA requested clarification of the proposed terminating action. AA stated the NPRM (79 FR 1772, January 10, 2014) is an interim action, and no information is provided regarding the terminating action. AA stated that, if issued, the final rule should contain sufficient documentation to clearly establish the effectivity of Model 777 airplanes subject to the rule, and to terminate the inspection program on the subject airplanes. AA stated that Boeing Fleet Team Digest 777-FTD-28-12002, dated January 10, 2014, among others, addresses the corrective action plan that is in progress.

We agree to provide clarification regarding the modification referenced in the NPRM (79 FR 1772, January 10, 2014). Since the issuance of the NPRM, the manufacturer has developed a modification that addresses the unsafe condition identified in this final rule. However, the service information is not available at this time. Since we have limited the applicability of this AD to exclude all new production airplanes that are delivered with AIMS-2 BP v 17 or later software, as explained previously, we find that no further change to this AD is necessary in this regard.

For the affected airplanes, there will likely be two possible terminating options—one to replace the fuel shutoff valve actuator, and another to upgrade airplanes with AIMS-2 systems to BP v 17 to address the unsafe condition. Because service information for these modifications is still being developed, we have not changed this final rule in this regard.

Boeing requested that the proposed requirement to incorporate the MOV actuator inspection into the AWL Section of the Instructions for Continued Airworthiness of the operator's maintenance or inspection program be replaced with an AD requirement to “perform the MOV inspection every 10 days.” Boeing stated that the MOV inspection is an interim mitigation and is required only until a redesigned MOV can be installed in the spar valve locations. Boeing stated that including the 10-day test requirement as the required AD action would allow installation of the redesigned MOV to be approved as an alternative method of compliance (AMOC) to the AD, and as a terminating action for the repetitive inspections, while avoiding the need for regulatory approval to remove the AWL from each operator's maintenance or inspection program. In addition, Boeing stated the AWLs are permanent actions that affect operators' planning and scheduling, and that incorporating a temporary AWL into the operators' maintenance documents or a Boeing MPD document will cause confusion among operators.

We disagree with the commenter's request. During the development of the NPRM (79 FR 1772, January 10, 2014), we discussed the impact of an AWL revision versus a repetitive inspection requirement with Boeing, who, in turn, discussed it with a sample of operators. At that time, both Boeing and the operators indicated that the addition of an AWL revision was the preferred solution because it would reduce the record keeping required to document AD compliance. Affected operators who wish to use a repetitive inspection requirement in place of an AWL may apply for approval of an AMOC in accordance with the provisions specified in paragraph (i)(1) of this AD, by submitting data substantiating that the request would provide an acceptable level of safety. We have not changed this AD in this regard.

AA requested that we extend the grace period for performing the initial inspection required by the new AWLs. AA stated that it is a complicated logistical matter to establish a new line maintenance task at stations throughout the world, and that there is a “learning curve to acclimate the line maintenance organizations to the new task.” In addition, AA stated that the existing inventory of actuators at maintenance stations may be insufficient to replace any failed valves discovered through the inspections, resulting in grounded airplanes, and that ordering new valves from the vendor generally takes at least 30 days.

We partially agree with the commenter's request. We retained the 30-day compliance time for revising the maintenance or inspection program, as applicable, to include the new AWL. In addition, we have changed the initial compliance time for accomplishing the actions specified in figure 1 to paragraph (g) of this AD to 10 days. The compliance time of 10 days is consistent with other regulatory actions on other affected airplane models.

We have determined that the initial compliance time for the inspection represents an appropriate time in which the required actions can be performed in a timely manner within the affected fleet, while still maintaining an adequate level of safety. In developing an appropriate compliance time, we considered the safety implications, parts availability, and normal maintenance schedules for timely accomplishment of the checks.

The check itself involves a visual inspection of an existing prominent design feature that is intended to indicate the position of the fuel shutoff valve actuator. This check is also described in existing maintenance documentation. The manufacturer does not expect a large number of latently failed valve actuators to be discovered. Existing parts stores are expected to be sufficient, and we expect that parts can be repositioned in time to support the initial inspections. However, under the provisions of paragraph (i) of this AD, we might consider requests for adjustments to the compliance time if data are submitted to substantiate that such an adjustment would provide an acceptable level of safety.

Aerologic GmbH, Air France, All Nippon Airways (ANA), AA, Boeing, FedEx, Japan Airlines Company Ltd. (JAL), KLM Royal Dutch Airlines (KLM), Lufthansa Technik AG (LTK), and Lufthansa Cargo AG (LUB) requested that we change the interval for the MOV actuator inspection of the engine fuel shutoff valve.

Aerologic GmbH, Air France, Lufthansa LTK, Lufthansa LUB, and KLM stated that the interval should be 25 flight cycles based on a typical utilization in flight cycles that corresponds to a one-week interval. The operators stated that the actuator failure mode is associated with the cycling of the valve, and the interval should, therefore, be based on flight cycles.

AA stated that the “weekly” interval is not defined sufficiently, and that it is not clear whether this means once every seven days, one time each calendar week, or some other interpretation. AA stated that, for its airline and for many other international carriers, this presents a problem when the airplane continually crosses the International Date Line. AA also stated that the interval does not address occurrences where the airplane is out of service for an extended period of time, such as a week or longer. AA stated that it has strong concerns that the proposed interval may impede the airline's ability to function on its current published schedule. AA stated that many established flight routings occur on a four-day cycle, and not all stations can be set up to perform the inspection for logistical, personnel, and contractual reasons; therefore, the weekly interval makes it very difficult to achieve the inspection at available stations. AA stated that the inspection, if mandated, should be on a flight-cycle interval rather than a calendar schedule, and suggested a 25-flight-cycle interval to alleviate the “weekly” term interpretation issue, and to address the adverse impact to airline operations.

JAL and ANA requested that the inspection interval be “25 flight cycles or more, or weekly or more, whichever occurs later.” JAL stated that the FAA-proposed inspection interval of “weekly” is without detailed information such as the number of latently failed fuel shutoff valves, failure rates, and so forth. JAL stated that it understands that it is preferable to control inspection intervals in flight cycles for international flights. JAL and ANA also stated that an average flight cycle for a Model 777 airplane might be 2.5 flight cycles per day, but that their domestic Model 777 flight cycle average is 6 flight cycles per day; therefore, it is a burden to inspect the MOV actuators at per-flight-cycle-related intervals. ANA stated that it prefers a compliance time of 18,000 flight cycles, which is stated in the MPD document. ANA stated that they currently perform the proposed inspection at 2,000-flight-hour intervals, and while it has experienced several fuel valve actuator failures, it has not detected any latently failed open fuel valve actuators.

SIA requested that the proposed inspection interval be extended to 2,000 flight hours. SIA stated that the inspections are disruptive, laborious, and costly to operations, and would require SIA to inspect at least three to four airplanes daily. SIA also stated that frequent opening and closing of panels to inspect the MOV actuator may inadvertently disrupt other airplane systems and result in unintended defects. SIA stated that, if operators are unable to inspect the airplane within the mandated intervals, or if the inspection findings require extensive rectification, Boeing or the FAA should consider granting operators a “no technical objection” or an AMOC to allow the airplane to be released to service for a restricted period of time. SIA also stated that it understands Boeing is working on a modified MOV actuator part number that would resolve the reliability issue associated with it.

Boeing requested that the interval be changed to 10 days. Boeing stated that it understood the term “weekly” to mean 10 days.

We partially agree with the commenters' request. We agree with extending the inspection interval to 10 days. Some operators' route structures and maintenance intervals do not align with a 7-day interval. Also, several of the operators routinely cross the International Date Line, potentially creating confusion over the application of an interval when expressed as “weekly.” The 10-day interval will provide more operational flexibility and will not significantly increase the number of at-risk flights. We have changed paragraph (g) of this AD and figure 1 to paragraph (g) of this AD accordingly.

We also added a note to the Interval column of figure 1 to paragraph (g) of this AD to specify that the inspection is not required on days when the airplane is not used in revenue service, and that the inspection must be done before further flight if it has been 10 or more calendar days since the last inspection.

However, we disagree with changing the interval basis to flight cycles. While the failure of the fuel shutoff valve is likely associated with the cycling of the valve, the purpose of the inspections is to minimize the exposure to flights that are initiated with a valve actuator that is latently failed in the open position.

To determine the appropriate actions and intervals to minimize this exposure, we considered the actions necessary to detect the latent failure on each affected airplane model, and then, based on those identified actions, determined a minimum practical interval for performing the actions.

On other Boeing airplane models with designs that allow a check to be performed using available indications, we determined that a daily check is appropriate. That interval is similar to the check interval required for fire detection systems. For the affected Model 777 airplanes identified in this final rule, the fuel shutoff valve position cannot be checked using available indications, and a physical inspection of the valve actuator itself is necessary to detect the latent failure. Because of the work necessary to perform this inspection, we determined that a daily interval would be overly burdensome and that the 10-day interval would be a more appropriate balance of the risk and the burden of performing the inspection. However, affected operators may apply for approval of an AMOC in accordance with the procedures specified in paragraph (i)(1) of this AD by submitting data substantiating that the request would provide an acceptable level of safety.

We also disagree that the performance of these inspections is likely to cause defects in other systems. While additional defects due to unrelated causes might be discovered during the visual inspection, the opening of the access door and visual inspection of the fuel shutoff valve position is not expected to cause other system failures.

FedEx requested that a provision be added to the proposed AD (79 FR 1772, January 10, 2014) to allow the removal of a working MOV actuator from a less critical fuel system valve location and installation in the engine fuel shutoff valve. FedEx stated that this will reduce the immediate impact of any actuator failures discovered by the required inspection.

We disagree with the request. This situation is not unique to the MOV actuator of the fuel shutoff valve. It is not our intent in this AD to change operational practices used in performing maintenance and alterations, or to change relief provided by the minimum equipment list (MEL). The removal of a fully functional part from a less critical location and its replacement with a non-functioning part is considered an alteration and, as such, must meet the airworthiness regulations, which is not possible in this case. However, if a failure occurs at a less critical location, operation in the same exact configuration may be allowed for a limited time under the MEL. The decision to allow this type of maintenance action remains with the local Flight Standards organization. Also, it should be noted that the installation of certain MOV actuators is prohibited by FAA AD 2013-05-03, Amendment 39-17375 (78 FR 17290, March 21, 2013). We have not changed this AD in this regard.

In the “Description” column of figure 1 to paragraph (g) of this AD, we have removed the phrase “refer to Boeing AMM 28-22-00” for performing an inspection of the MOV actuator of the fuel spar valve (i.e., the fuel shutoff valve).

We reviewed the relevant data, considered the comments received, and determined that air safety and the public interest require adopting this AD with the changes described previously, and minor editorial changes. We have determined that these minor changes:

• Αre consistent with the intent that was proposed in the NPRM (79 FR 1772, January 10, 2014) for correcting the unsafe condition; and

• Do not add any additional burden upon the public than was already proposed in the NPRM (79 FR 1772, January 10, 2014).

We also determined that these changes will not increase the economic burden on any operator or increase the scope of this AD.

We consider this AD interim action. The manufacturer has developed a modification that addresses the unsafe condition for some of the airplanes identified in this AD. Once the service information for the modification is developed, approved, and available, we might consider additional rulemaking.

We estimate that this AD affects 190 airplanes of U.S. registry.

We estimate the following costs to comply with this AD:

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

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

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

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

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

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

(3) Will not affect intrastate aviation in Alaska, and

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

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

Discussion

We issued a notice of proposed rulemaking (NPRM) to amend 14 CFR part 39 by adding an AD that would apply to all The Boeing Company Model 737-600, -700, -700C, -800, -900, and -900ER series airplanes. The NPRM published in the Federal Register on April 14, 2014 (79 FR 20834). The NPRM was prompted by reports of latently failed fuel shutoff valves discovered during fuel filter replacement. The NPRM proposed to require revising the maintenance or inspection program to include new airworthiness limitations. We are issuing this AD to detect and correct latent failures of the fuel shutoff valve to the engine, which could result in the inability to shut off fuel to the engine and, in case of certain engine fires, an uncontrollable fire that could lead to wing failure.

In preparation of AD actions such as NPRMs and immediately adopted rules, it is the practice of the FAA to obtain technical information and information on operational and economic impacts from design approval holders and aircraft operators. We discussed certain comments addressed in this final rule in a teleconference with Airlines for America (A4A) and other members of the aviation industry. All of the comments discussed during this teleconference are addressed in this final rule in response to comments submitted by other commenters. A discussion of this contact can be found in the rulemaking docket at http://www.regulations.gov by searching for and locating Docket No. FAA-2014-0194.

Throughout the preamble of this final rule, commenters may have used the terms “fuel shutoff valve” and “fuel spar valve” interchangeably. Both terms refer to the same part. In our responses to comments, we have used the term “fuel shutoff valve.” The term “fuel spar valve” is more commonly used in airplane maintenance documentation and, therefore, we have used that term in figure 1 to paragraph (g) of this AD.

We gave the public the opportunity to participate in developing this AD. The following presents the comments received on the NPRM (79 FR 20834, April 14, 2014) and the FAA's response to each comment.

American Airlines (AA) requested that no further regulatory action be taken. AA stated that it has experienced only a small number of fuel shutoff valve actuator failures. AA stated that the combination of failures necessary to produce the catastrophic event described in the NPRM (79 FR 20834, April 14, 2014) includes fuel shutoff valve actuator failure, an erroneous position indication, and a fire in the engine compartment. AA also stated that risk analysis shows the probability of this combination occurring is in the improbable range of “10E-11 to 10E-16.”

We disagree with commenter's request. We have determined that an unsafe condition exists that warrants an interim action until the manufacturer finishes developing a modification that will address the identified unsafe condition. We have determined that, without the required interim action, a significant number of flights with a fuel shutoff valve actuator that is failed in the open valve position will occur during the affected fleet life. If certain engine fire conditions were to occur, or if extreme engine damage were to occur, or if an engine separation event were to occur during flight, the crew procedures for such an event would not stop the fuel flow to the engine strut and nacelle. The continued flow of fuel could cause an uncontrolled fire or lead to a fuel exhaustion event.

The FAA regulations require all transport airplanes to be fail safe with respect to engine fire events, and the risk due to severe engine damage events to be minimized. Therefore, we require, for each flight, sufficiently operative fire safety systems so that fires can be detected and contained, and that fuel to the engine strut and nacelle can be shut off in the event of an engine fire or severe damage.

The FAA airworthiness standards require remotely controlled powerplant valves to provide indications that the valves are in the commanded position. These indications allow the prompt detection and correction of valve failures. We do not allow dispatch with a known inoperative fuel shutoff valve. Therefore, we are proceeding with this final rule—not because of the higher-than-typical failure rate of the particular valve actuator involved, but instead because the fuel shutoff valve actuator can fail in a manner that also defeats the required valve position indication feature. That failure can lead to a large number of flights occurring on an airplane with a fuel shutoff valve actuator failed in the open position without the operator being aware of the failure. An airworthiness limitation containing required inspections is intended to limit the number of flights following latent failure of the fuel shutoff valve. We have not changed this AD in this regard.

AirDo, AA, All Nippon Airlines (ANA), Delta Airlines (DAL), Southwest Airlines (SWA), Transavia, and United Airlines (UAL) requested clarification of the daily check requirement. The commenters stated that the check applies to airplanes that are in operational revenue status. The commenters stated that the proposed AD (79 FR 20834, April 14, 2014) does not account for airplanes in routine maintenance or for an out-of-service condition.

We infer the commenters are requesting inspection relief for airplanes that are not in service. We agree with the commenters' request. It would be unnecessarily burdensome to require the inspections on airplanes that are not being used. We agree with limiting inspections to days when the airplane is in revenue service. In the Interval column of figure 1 to paragraph (g) of this AD, we have added a note to clarify that the operational check is not required on days when the airplane is not used in revenue service, but that the check must be done before further flight once the airplane is returned to revenue service.

UAL requested that we revise the proposed AD (79 FR 20834, April 14, 2014) to limit the applicability specified in figure 1 to paragraph (g) of the proposed AD to airplanes with the valve actuators that have the identified unsafe condition. UAL stated the applicability applies to valve actuators having part number (P/N) MA30A1001. UAL stated that the problem does not apply to other existing actuator designs, and will not apply to future designs.

We agree with the commenter's request. It would be unnecessarily burdensome to require the inspections on airplanes that do not have any of the susceptible valves installed. We have added a note to the Applicability column in figure 1 to paragraph (g) of this AD to clarify that the limitations apply to Model 737-600, -700, -700C, -800, -900, and -900ER airplanes having actuator P/N MA20A2027 (Boeing P/N S343T003-56) or P/N MA30A1001 (Boeing P/N S343T003-66) installed at the engine fuel spar valve positions.

AA and Qantas Airways stated that if the master minimum equipment list (MMEL) is being used, then the daily check should be not required.

AA stated that the Boeing Model 737 MMEL item 28-22, “Fuel/Spar Valve Closed Lights,” allows for the lights to be inoperative, provided the associated valve is verified to operate normally and the crossfeed VALVE OPEN light operates normally. AA stated that this item allows the lights to be inoperative for up to 10 days, and it requested that a provision be added to state that if this MMEL is being used, the daily check is not required.

Qantas Airways stated that if an airplane is dispatched under the MMEL for inoperative SPAR VALVE CLOSED light(s), then it is not possible to accomplish the proposed checks.

We partially agree with the commenters' request. We disagree with providing MMEL relief for an inoperative fuel shutoff valve indication because such relief could potentially allow the fuel shutoff valve to be inoperative for up to 10 days of revenue operation. However, we do agree to provide flexibility regarding verification that the fuel shutoff valve is operational. We have added item D. to figure 1 to paragraph (g) of this AD to specify a fourth option to perform daily inspections to verify that the fuel shutoff valve is closing.

Air Do, Ryanair, SWA, Transavia, UAL, and Darryl Voss requested that the FAA provide a more complete explanation of the requirements with regard to recording compliance.

Air Do stated that if the flightcrew performed the operational check, a maintenance record is usually not created. The commenter questioned whether this is acceptable, or whether the flightcrew should record it in the flight log.

Ryanair requested that the FAA explicitly state in the AD that the proposed actions may be performed by maintenance and/or flight operations checklists, and that the AD will not require the retention of maintenance or flight operations records to show compliance. Ryanair stated that due to the high frequency of the actions in the NPRM (79 FR 20834, April 14, 2014) and the large number of affected airplanes in its fleet (approximately 300), the creation, retention, and reforecasting of individual records for this activity is not practical.

Because of the high frequency of checks resulting from the proposed AD (79 FR 20834, April 14, 2014), compounded with the creation, distribution, and retention of the documentation of the checks, SWA requested that the FAA specifically state in the AD that when the daily check is performed successfully by flightcrews, no documentation is required. SWA also requested that the FAA specifically state in the AD that documentation (i.e., logbook entry or other type of defect report) is required only when a failure is detected by the flightcrew, or when the check is performed by maintenance personnel.

Transavia requested that, if the daily check remains, we revise the proposed AD (79 FR 20834, April 14, 2014) to state that the inclusion of the daily check requirement into a checklist is sufficient to show AD compliance and prevent unwanted paperwork, and that the daily check can be performed by either maintenance personnel or the flightcrew.

UAL asked whether the flightcrews will be required to record compliance of the operational checks and document each inspection. Darryl Voss requested that we revise the proposed AD (79 FR 20834, April 14, 2014) to remove the option to allow flightcrews to perform operational checks for maintenance. Mr. Voss stated that showing compliance with ADs is almost exclusively a maintenance function and should remain a maintenance function to provide compliance continuity.

We agree that clarification is necessary. This AD requires including the information in figure 1 of paragraph (g) of this AD in the maintenance or inspection program. However, this AD does not require accomplishing the actions specified in figure 1 of paragraph (g) of this AD. The actions specified in the figure in this AD are done, and remain enforceable, as part of the airworthiness limitations of the instructions for continued airworthiness (ICA). Section 14 CFR 43.11(a) of the Federal Aviation Regulations (14 CFR 43.11(a)) requires maintenance record entries for maintenance actions such as the required checks. If an operator elects to have a flightcrew member do the check in accordance with the applicable airworthiness limitation, that same action would be considered an operational task (not maintenance), and therefore 14 CFR 43.11(a) would not apply. In that case, operators should follow their normal processes for operational activities, including necessary Principal Operations Inspector (POI) involvement. We have not changed this AD in this regard.

Boeing requested to add a flightcrew inspection procedure during engine start and engine shutdown. Boeing stated that this will provide common flight procedures and eliminate each operator creating its own test.

DAL requested that the preamble of the NPRM (79 FR 20834, April 14, 2014) be revised to match the rest of the requirements in the NPRM. DAL stated that if POI approval is required for flightcrews to accomplish operational checks, then the preamble should identify that flightcrews can only accomplish operational checks approved by the inspector. DAL stated that the preamble should not associate the operational check without engine start to only maintenance crews, and the operational checks while starting the engine or shutting down the engine to only flightcrews.

UAL requested that standardized procedures be established by the FAA aircraft certification office for the POI to approve on behalf of all affected operators.

We disagree with the commenter's request to add to this AD a method describing how maintenance actions and operations actions should be coordinated. The operational requirements are specified in figure 1 to paragraph (g) of this AD; how these requirements are captured in the operations processes to ensure that the maintenance action has been completed is likely different for each operator. As the commenter stated, flightcrews can only accomplish operational checks approved by the inspector. No change has been made to the final rule in this regard.

DAL requested that the proposed AD (79 FR 20834, April 14, 2014) be revised to provide an option for revising the Boeing Model 737 “Airplane Normal Checklist” to specify accomplishment of one of the required operational checks (operational check during engine start, operational check during engine shutdown, or operational check without engine operations) as a “FIRST FLIGHT OF THE DAY” requirement as an alternative to the maintenance or inspection program revision specified in paragraph (g) of the proposed rule. DAL stated that this option would ensure that operational aircraft are inspected daily, provide clear responsibility to the flightcrew to accomplish the operational checks, and remove concern for accomplishing the actions during times when the airplane is not in service. DAL stated that incorporating this change to the “Airplane Normal Checklist” will simplify compliance procedures while satisfying the requirements of the proposed rule.

JAL requested that the FAA coordinate with Boeing to revise the flightcrew operations manual (FCOM) to provide the check of the fuel spar valve as a normal procedure. JAL stated that if an operational check by the flightcrew is allowed, the FCOM should be revised to provide the normal procedure to perform the fuel spar valve check during engine start or shutdown.

Qantas Airways suggested that a revision to the Boeing Model 737 Airplane Flight Manual (AFM), Section 1 “Certificate Limitations,” or Section 3 “Normal Procedures,” might be a more appropriate location to allow the flightcrew to monitor valve operations during engine start and/or engine shutdown.

We find that clarification is necessary. Changing these documents presupposes that every operator will have flightcrews perform this task. It is not our intention to require flightcrews to perform this task. Individual operators can modify their normal operating procedures to add this requirement.

Qantas stated that it does not believe that paragraph B. of the Description column of figure 1 to paragraph (g) of the proposed AD (79 FR 20834, April 14, 2014), which specifies to do an operational check during engine start, achieves the desired failure detection. Qantas stated that if the test fails (i.e., bright light fails to illuminate), the valve has failed to open; this is different than a valve that has failed to close. Qantas stated that the test should identify the failed actuator in the failure mode, which results in an unsafe condition.

We infer that Qantas is requesting we clarify the operational check during engine start. We find that clarification is necessary. The check procedure is designed to make sure the fuel shutoff valve actuator moves to the open position from the closed position. However, if the fuel shutoff valve actuator had previously failed open, the actuator would not move the valve and this check would fail. If this check fails, the fuel shutoff valve actuator is either failed in the closed position or has failed previously in the open position. Either way, the failed fuel shutoff valve actuator must be replaced. We have not changed this AD in this regard.

UAL requested we add a requirement to provide electrical power before accomplishment of the maintenance check specified by the proposed AD (79 FR 20834, April 14, 2014).

We agree with the commenter's request because electrical power is required. In item C.1. of figure 1 to paragraph (g) of this AD, we have added an instruction to supply electrical power to the airplane using standard practices when performing the operational check.

Boeing requested that figure 1 to paragraph (g) of the proposed AD (79 FR 20834, April 14, 2014) be revised in order to reference the Fault Isolation Manual (FIM), instead of the Boeing Model 737 Aircraft Maintenance Manual (AMM), should the operational check fail. Boeing stated that the faults are isolated to failed components using the FIM. The AMM provides instructions for removing and replacing identified failed components. Boeing stated that the light could fail to illuminate for reasons other than actuator failure.

We disagree with the commenter's request to reference the FIM instead of the AMM. If an operational check fails, the failed component must be replaced. As Boeing stated, the AMM provides instructions for replacing failed components. The FIM also refers to the AMM for replacement of the fuel shutoff valve actuator after doing some preliminary testing. Operators may consult the FIM for guidance in troubleshooting other reasons the light could fail to illuminate. We have not changed this AD in this regard.

ANA requested that the repetitive interval be revised from daily to 15,000 flight hours or 6,000 flight hours, or a weekly interval. ANA stated that Boeing has included these repetitive intervals in certain maintenance documents. ANA commented that it has 38 airplanes in operation and it has never experienced a latent failure of the MOV actuator. ANA also stated that the possibility of the unsafe condition happening is very low. ANA stated that a daily interval is a burden to operators.

DAL requested that the operational checks be required at intervals not to exceed 90 days or 1,400 flight cycles or 1,800 flight hours; DAL stated that this is similar to what is proposed by the original equipment manufacturer. DAL stated that Airworthiness Limitation Task 28-AWL-MOV, “Engine Fuel Shut-Off Valve (Fuel Spar Valve) Position Indication Operational Check,” which was introduced by the proposed AD (79 FR 20834, April 14, 2014), would require daily operational checks of the engine fuel shutoff valve. DAL stated that it finds this will be an onerous operational requirement as it does not have maintenance personnel in all locations where the affected airplanes are operated. DAL stated that for this reason, it will be necessary for its flightcrews to accomplish the operational checks in order to comply with the daily requirement specified by the proposed AD.

DAL also stated that the proposed AD (79 FR 20834, April 14, 2014) does not provide significant information as to how the daily check requirement was determined or why it differs so significantly from the compliance recommendation established by Boeing. DAL stated that lacking specific details of the methodology used by the FAA and the assumptions made to arrive at a daily check interval hinders the operator's ability to provide comments on the appropriateness of this interval. DAL stated that Boeing has indicated that its numeric safety analysis supports a compliance period of 3,000 flight hours for the operational checks. DAL also stated that based on current DAL utilization, accomplishment of daily checks equates to accomplishing the check approximately 300 times more frequently than the interval supported by the Boeing safety analysis.

JAL requested that the FAA extend the inspection interval to a heavy maintenance opportunity. For Model 737-800 airplanes, JAL stated to set the heavy maintenance opportunity (such as “C-Check” and “K-Check”) at approximately 2-year intervals to efficiently accomplish the maintenance program.

Qantas Airways requested an interval that can be effectively scheduled in aircraft maintenance control programs, such as a 7-day interval.

Jim Way requested a monthly interval for the operational checks. Mr. Way stated that a daily check is too restrictive.

Bradley Most requested that the daily inspection interval be revised to every 2 calendar days to accommodate “international operations, out of station, overnight, etc.” Mr. Most stated that the interval of daily lacks a clear definition.

We disagree with the requests to extend the inspection interval. An increase in the inspection interval from daily to every other day, to weekly, or to 90 days, would result in 2, 7, or 90 times as many flights at risk in the event of an engine fire. The daily inspection has been deemed practical because, in practice, it will mean the flightcrew will need to watch a light as they start or shut down the engine using normal procedures. An increased interval to 6,000 flight hours would have no real effect on the unsafe condition since the fuel filter replacement currently detects the problem every 6,000 flight hours. In addition, an increased interval of 15,000 flight hours, or 24 months, would similarly not improve safety. We have not changed this AD in this regard.

Mr. Most requested that the compliance time to revise the maintenance or inspection program be changed to 120 days after the effective date of this AD. Mr. Most stated that FAA offices are typically requesting 60 days to review an airplane maintenance or inspection program revision that is submitted for approval and, in many cases, are taking longer. Mr. Most stated that the current inspection interval would not allow operators enough time to revise the airplane maintenance or inspection program, submit it to FAA for approval, and implement the revised airplane maintenance or inspection program within 30 days of the effective date.

Jim Way requested that operators be given 90 days after the effective date of the proposed AD (79 FR 20834, April 14, 2014) to incorporate the actions specified in figure 1 to paragraph (g) of the proposed AD into the maintenance program. Mr. Way stated that single aircraft operators use a vendor to provide support for the inspection program revisions. Mr. Way stated that a 30-day compliance time after the effective date of the proposed AD is not enough time to properly make and submit the changes to the FAA's principal maintenance inspector for approval and implementation.

We do not agree to revise the compliance time for revising the maintenance or inspection program beyond 30 days. The 30-day compliance time specified in paragraph (g) of this AD is consistent with other regulatory actions for other affected models in similar ADs. However, under the provisions of paragraph (i)(1) of this AD, we might consider requests for adjustments to the compliance time if data are submitted to substantiate that such an adjustment would provide an acceptable level of safety.

AA requested that 30 days be provided for the initial operational check after the airworthiness limitation (AWL) has been incorporated into its maintenance program. AA stated that this will allow for publishing the new criteria.

We partially agree with AA's request concerning the compliance time for the initial operational check. We have changed the initial compliance time specified in paragraph (g) of this AD for accomplishing the actions specified in figure 1 to paragraph (g) of this AD from 7 to 10 days. The compliance time of 10 days is consistent with other regulatory actions for other affected models in similar ADs. We have determined that 10 days for the initial inspection represents an appropriate time in which the required actions can be performed in a timely manner within the affected fleet, while still maintaining an adequate level of safety.

DAL requested that paragraph (g) of the proposed AD (79 FR 20834, April 14, 2014) be revised because it is not clear who must accomplish the action in this paragraph. DAL stated that operators do not control the AWL section of the ICA and, therefore, could not comply with the requirement. DAL stated that on Boeing Model 737NG airplanes, the AWLs are incorporated into Section 9 of the Maintenance Planning Document (MPD) by Boeing. DAL stated that the action in the NPRM would be one for the original equipment manufacturer to accomplish with a revision to the MPD, which would then be incorporated by the operators. DAL also stated that operators have control of their continuous airworthiness maintenance program (CAMP). DAL stated that in the NPRM, it is the intent of the operators to incorporate the AWL into their CAMP.

We find that clarification is necessary. The requirement in paragraph (g) of this AD is to change the Airworthiness Limitations of the ICA for each affected airplane. Once that change is complete, operators will be compelled to change their maintenance program to include the new requirements of the revised Airworthiness Limitations. For Part 121 operators, changes to the CAMP will become necessary; but for other operators, the maintenance program may take a different form. We have not changed the AD in this regard.

DAL requested that certain language be removed from the proposed AD (79 FR 20834, April 14, 2014) because it is redundant. DAL stated that paragraph (h) of the proposed AD can be excluded because it states that no alternative actions or intervals can be used unless approved as an alternative method of compliance (AMOC) in accordance with the procedures specified in paragraph (i)(1) of the proposed AD. (Paragraph (i) of the proposed AD specifies the procedures and requirements for an AMOC.)

We disagree with the commenter's request. It is necessary to include paragraph (h) of this AD (“No Alternative Actions or Intervals”) because it ensures that changes made after accomplishment of the maintenance or inspection program revision, e.g., using new versions of the maintenance or inspection program, are done only when approval of an AMOC is obtained from the FAA. We have not changed this AD in this regard.

DAL stated that the cost estimate provided in the NPRM (79 FR 20834, April 14, 2014) is inaccurate. DAL stated that the cost reflected in the NPRM is for incorporating the proposed program change into the operator's program only as a revision of the maintenance or inspection program.” DAL stated the cost estimate presented is flawed in two aspects: It does not properly account for the cost operators will take on in implementing the program changes, and it does not account for the cost of actually performing the inspections specified by the proposed maintenance or inspection program changes.

We infer that DAL is requesting we revise the Costs of Compliance paragraph. We acknowledge the commenter's concern. In this AD, the required action is to revise the maintenance or inspection program, as applicable, to include a new airworthiness limitation. The added airworthiness limitation requires an inspection of the position of the MOV actuator daily. However, these repetitive inspections, which are expected to take a few seconds to complete, are required by section 91.403(c) of the Federal Aviation Regulations (14 CFR 91.403(c)) once incorporated into the maintenance or inspection program.

The cost analysis in AD rulemaking actions typically includes only the costs associated with complying with the AD. In this AD, the required action is the maintenance or inspection program revision, as applicable, to include the new airworthiness limitation. Accomplishing repetitive actions that are specified in the airworthiness limitation are not directly required by this AD. The FAA, as a matter of practice, does not include a cost estimate for these repetitive actions in an AD because these actions are required as part of the operating rules. Therefore, we have made no change to this AD in this regard.

UAL requested we revise the wording of the operational check without engine operation. UAL stated that in item C.3.a. and item C.4.a. in the Description column of figure 1 to paragraph (g) of this AD, either a tolerance should be added to the wording, or the word “approximately” should be added before the phrase “10 seconds.”

We agree with the commenter's request. In item C.4.a. and item C.5.a. (which correspond to items C.3.a. and C.4.a. of the NPRM (79 FR 20834, April 14, 2014)) in the Description column of figure 1 to paragraph (g) of this AD, we have added wording that indicates to wait “approximately” 10 seconds after moving the ENG 1 and ENG 2 START LEVER on the CONTROL STAND to the IDLE position. We find that this change will allow flexibility during the operational check, while still maintaining an adequate level of safety.

Boeing and DAL requested that we correct a typographical error in the proposed AD (79 FR 20834, April 14, 2014). Boeing and DAL stated that item A.1. in the Description column of figure 1 to paragraph (g) of the proposed AD, which states to “do all operational checks . . .,” the word “all” should be removed because the operational check is a singular check.

We agree with the commenters' request. We have revised item A.1. in the Description column of figure 1 to paragraph (g) of this AD accordingly.

Boeing also requested that certain other typographical errors in the proposed AD (79 FR 20834, April 14, 2014) be corrected to reduce the possibility of confusion regarding the requirements. Boeing stated that the Description column in figure 1 to paragraph (g) of the proposed AD should be revised as follows:

• Step B.2. has been skipped, and needs to be renumbered.

• In step B.1.a., the text “START LEVEL STAND” should be changed to “START LEVER ON CONTROL STAND.”

• Steps C.2. and C.3. should be combined and renumbered.

• In step C.5.a., the text “ENG @” should be changed to “ENG 2.”

We disagree with the comment. The stated typographical errors for step B.1.a., step B.2., and step C.5.a., do not exist in the regulatory text of the NPRM (79 FR 20834, April 14, 2014), as published. We disagree with combining steps C.2. and C.3 because the engine fire switches represent separate actions for the aft electronic panel and the forward overhead panel. We have not changed this AD in this regard.

Aviation Partners Boeing stated that the installation of winglets per Supplemental Type Certificate (STC) ST00830SE (http://rgl.faa.gov/Regulatory_and_Guidance_Library/rgstc.nsf/0/3ed73703f205e3b386257e2f0064f3b1/$FILE/ST00830SE.pdf) does not affect the accomplishment of the manufacturer's service instructions.

We reviewed the relevant data, considered the comments received, and determined that air safety and the public interest require adopting this AD with the changes described previously and minor editorial changes. We have determined that these minor changes:

• Are consistent with the intent that was proposed in the NPRM (79 FR 20834, April 14, 2014) for correcting the unsafe condition; and

• Do not add any additional burden upon the public than was already proposed in the NPRM (79 FR 20834, April 14, 2014).

We also determined that these changes will not increase the economic burden on any operator or increase the scope of this AD.

We consider this AD interim action. The manufacturer is currently developing a modification that will address the unsafe condition identified in this AD. Once this modification is developed, approved, and available, we might consider additional rulemaking.

We estimate that this AD affects 1,244 airplanes of U.S. registry.

We estimate the following costs to comply with this AD:

This amendment to part 95 of the Federal Aviation Regulations (14 CFR part 95) amends, suspends, or revokes IFR altitudes governing the operation of all aircraft in flight over a specified route or any portion of that route, as well as the changeover points (COPs) for Federal airways, jet routes, or direct routes as prescribed in part 95.

The specified IFR altitudes, when used in conjunction with the prescribed changeover points for those routes, ensure navigation aid coverage that is adequate for safe flight operations and free of frequency interference. The reasons and circumstances that create the need for this amendment involve matters of flight safety and operational efficiency in the National Airspace System, are related to published aeronautical charts that are essential to the user, and provide for the safe and efficient use of the navigable airspace. In addition, those various reasons or circumstances require making this amendment effective before the next scheduled charting and publication date of the flight information to assure its timely availability to the user. The effective date of this amendment reflects those considerations. In view of the close and immediate relationship between these regulatory changes and safety in air commerce, I find that notice and public procedure before adopting this amendment are impracticable and contrary to the public interest and that good cause exists for making the amendment effective in less than 30 days.

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. 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. For the same reason, the FAA certifies that this amendment will not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

Accordingly, pursuant to the authority delegated to me by the Administrator, part 95 of the Federal Aviation Regulations (14 CFR part 95) is amended as follows effective at 0901 UTC, October 15, 2015.

Background

Regulations under section 482 published in the Federal Register (33 FR 5848) on April 16, 1968, provided guidance on methods for applying the arm's length standard to evaluate controlled transactions, including transfers of tangible and intangible property, the provision of services, and loans or advances. Subsequent revisions and updates of the transfer pricing regulations were published in the Federal Register on July 8, 1994, Dec. 20, 1995, May 13, 1996, Aug. 26, 2003, Aug. 4, 2009, Dec. 22, 2011, and Aug. 27, 2013 (59 FR 34971, 60 FR 65553, 61 FR 21955, 68 FR 51171, 74 FR 38830, 76 FR 80082, and 78 FR 52854, respectively).

Section 482 authorizes the Secretary, and the regulations under section 482 authorize the IRS, to adjust the results of controlled transactions to clearly reflect the income of commonly controlled taxpayers in accordance with the arm's length standard and, in the case of the transfer of intangible property (within the meaning of section 936(h)(3)(B)), so as to be commensurate with the income attributable to the intangible. While the determination of arm's length prices for controlled transactions is governed by section 482, the tax treatment of controlled transactions is also governed by other Code and regulatory rules applicable to both controlled and uncontrolled transactions. Controlled transactions always remain subject to section 482 in addition to these generally applicable provisions. These temporary regulations clarify the coordination of section 482 and the regulations thereunder with such other Code and regulatory provisions.

The coordination rules in these temporary regulations apply to controlled transactions, including controlled transactions that are subject in whole or part to both sections 367 and 482. Transfers of property subject to section 367 that occur between controlled taxpayers require a consistent and coordinated application of sections 367 and 482 to the controlled transfer of property and any related transactions between controlled taxpayers. The controlled transactions may include transfers of property subject to section 367(a) or (e), transfers of intangible property subject to section 367(d) or (e), and the provision of services that contribute significantly to maintaining, exploiting, or further developing the transferred properties. All of the transactions (and any elements thereof) must be analyzed and valued on a consistent basis under section 482 in order to achieve the intended purposes of sections 367 and 482.

The consistent analysis and valuation of transactions subject to multiple Code and regulatory provisions is required under the best method rule described in § 1.482-1(c). A best method analysis under section 482 begins with a consideration of the facts and circumstances related to the functions performed, the resources employed, and the risks assumed in the actual transaction or transactions among the controlled taxpayers, as well as in any uncontrolled transactions used as comparables. See § 1.482-1(c)(2)(i) and (d)(3). For example, if consideration of the facts and circumstances reveals synergies among interrelated transactions, an aggregate evaluation under section 482 may provide a more reliable measure of an arm's length result than a separate evaluation of the transactions. In contrast, an inconsistent or uncoordinated application of section 482 to interrelated controlled transactions that are subject to tax under different Code and regulatory provisions may lead to inappropriate conclusions.

The best method rule requires a determination of the arm's length result of controlled transactions under the method, and particular application of that method, that provides the most reliable measure of an arm's length result. Under the regulations, the reliability of the measure depends on the economics of the controlled transactions, not their formal character. See, e.g., §§ 1.482-2A(e)(3)(vii) and 1.482-3(c)(3)(ii)(D) (use of sales agent's commission as comparable for reseller's appropriate markup under the resale price method); §§ 1.482-2A(e)(4)(iv) and 1.482-3(d)(3)(ii)(D) (use of purchasing agent's commission as comparable for producer's appropriate gross profit percentage under the cost-plus method); and § 1.482-9(i)(4) and (5), Examples 1 and 3 (reference to charges for transfers of property as relevant to the determination of a contingent-payment services charge). Realistic alternative transactions that, on a risk-adjusted basis, reflect arrangements that are economically equivalent to those in the controlled transactions may provide the basis for application of unspecified methods to determine the most reliable measure of an arm's length result in the controlled transactions. See, e.g., §§ 1.482-1(f)(2)(ii)(A), 1.482-3(e)(1), 1.482-4(d)(1), 1.482-7(g)(8), and 1.482-9(h). Thus, although a taxpayer may choose among different transactional forms—for example, a long-term license, research and development services, a cost sharing arrangement, or a transfer subject to section 367—specified and unspecified methods applicable to each form will provide consistent arm's length results for economically equivalent transactions.

Based upon taxpayer positions that the IRS has encountered in examinations and controversy, the Treasury Department and the IRS are concerned that certain results reported by taxpayers reflect an asserted form or character of the parties' arrangement that involves an incomplete assessment of relevant functions, resources, and risks and an inappropriately narrow analysis of the scope of the transfer pricing rules. In particular, the Treasury Department and the IRS are concerned about situations in which controlled groups evaluate economically integrated transactions involving economically integrated contributions, synergies, and interrelated value on a separate basis in a manner that results in a misapplication of the best method rule and fails to reflect an arm's length result. Taxpayers may assert that, for purposes of section 482, separately evaluating interrelated transactions is appropriate simply because different statutes or regulations apply to the transactions (for example, where section 367 and the regulations thereunder apply to one transaction and the general recognition rules of the Code apply to another related transaction). These positions are often combined with inappropriately narrow interpretations of § 1.482-4(b)(6), which provides guidance on when an item is considered similar to the other items identified as constituting intangibles for purposes of section 482. The interpretations purport to have the effect, contrary to the arm's length standard, of requiring no compensation for certain value provided in controlled transactions despite the fact that compensation would be paid if the same value were provided in uncontrolled transactions.

As discussed in the following portion of this preamble, these temporary regulations address the aforementioned concerns by clarifying the coordination of the application of section 482 in conjunction with other Code and regulatory provisions in determining the proper tax treatment of controlled transactions.

New § 1.482-1T(f)(2)(i)(A) provides that arm's length compensation must be consistent with, and must account for all of, the value provided between the parties in a controlled transaction, without regard to the form or character of the transaction. For this purpose, it is necessary to consider the entire arrangement between the parties, as determined by the contractual terms, whether written or imputed in accordance with the economic substance of the arrangement, in light of the actual conduct of the parties. This requirement is consistent with the principles underlying the arm's length standard, which require arm's length compensation in controlled transactions equal to the compensation that would have occurred if a similar transaction had occurred between similarly situated uncontrolled taxpayers. See § 1.482-1(b)(1). Accordingly, no inference may be drawn from any provision in the section 482 regulations that any transfer of value may be made without arm's length compensation.

Section 1.482-1T(f)(2)(i)(B) clarifies § 1.482-1(f)(2)(i)(A), which provided that the combined effect of two or more separate transactions (whether before, during, or after the year under review) may be considered if such transactions, taken as a whole, are so interrelated that an aggregate analysis of such transactions provides the most reliable measure of an arm's length result determined under the best method rule of § 1.482-1(c). Specifically, a new clause is added to clarify that this aggregation principle also applies for purposes of an analysis under multiple provisions of the Code or regulations. In addition, a new sentence elaborates on the aggregation principle by noting that consideration of the combined effect of two or more transactions may be appropriate to determine whether the overall compensation is consistent with the value provided, including any synergies among items and services provided. Finally, § 1.482-1T(f)(2)(i)(B) does not retain the statement in § 1.482-1(f)(2)(i)(A) that transactions generally will be aggregated only when they involve “related products or services, as defined in § 1.6038A-3(c)(7)(vii).” The eliminated sentence had the unintended potential to be misconstrued by taxpayers as limiting the aggregation analysis pursuant to the best method rule.

Section 1.482-1T(f)(2)(i)(C) provides that, for one or more controlled transactions governed by more than one provision of the Code and regulations, a coordinated best method analysis and evaluation of the transactions may be necessary to ensure that the overall value provided (including any synergies) is properly taken into account. A coordinated best method analysis of the transactions includes a consistent consideration of the facts and circumstances of the functions performed, resources employed, and risks assumed, and a consistent measure of the arm's length results, for purposes of all relevant Code and regulatory provisions. For example, situations in which a coordinated best method analysis and evaluation may be necessary include (1) two or more interrelated transactions when either all such transactions are governed by one regulation under section 482 or all such transactions are governed by one subsection of section 367, (2) two or more interrelated transactions governed by two or more regulations under section 482, (3) a transfer of property subject to section 367(a) and an interrelated transfer of property subject to section 367(d), (4) two or more interrelated transactions where section 367 applies to one transaction and the general recognition rules of the Code apply to another interrelated transaction, and (5) other circumstances in which controlled transactions require analysis under multiple Code and regulatory provisions.

Section 1.482-1T(f)(2)(i)(D) provides that it may be necessary to allocate the arm's length result that was properly determined under a coordinated best method analysis described in § 1.482-1T(f)(2)(i)(C) among the interrelated transactions. Any such allocation must be made using the method that, under the facts and circumstances, provides the most reliable measure of an arm's length result for each allocated amount.

Section 1.482-1T(f)(2)(i)(E) provides eleven examples to illustrate the guidance in § 1.482-1T(f)(2)(i)(A) through (D). Examples 1 through 4 are materially the same as the Examples in § 1.482-1(f)(2)(i)(B). The Treasury Department and the IRS do not intend for the revisions to those examples to be interpreted as substantive. The rest of the examples are new.

Section 1.482-1T(f)(2)(ii)(B) replaces § 1.482-1(f)(2)(ii)(B). The Example included in § 1.482-1T(f)(2)(ii)(B) is materially the same as the old example and has been updated to replace the term “district director” and to include cross-references to Examples 7 and 8 in § 1.482-1T(f)(2)(i)(E). The Treasury Department and the IRS do not intend for the revisions to this example to be interpreted as substantive.

No inference is intended as to the application of the provisions amended by these temporary regulations under current law. The IRS may, where appropriate, challenge transactions, including those described in these temporary regulations and this preamble, under currently applicable Code or regulatory provisions or judicial doctrines.

These regulations apply to taxable years ending on or after September 14, 2015.

Certain IRS regulations, including this one, are exempt from the requirements of Executive Order 12866, as supplemented and reaffirmed by Executive Order 13563. Therefore, a regulatory impact assessment is not required. It has been determined that section 553(b) of the Administrative Procedure Act (5 U.S.C. chapter 5) does not apply to this regulation. For applicability of the Regulatory Flexibility Act (5 U.S.C. chapter 6), refer to the cross-referenced notice of proposed rulemaking published elsewhere in this issue of the Federal Register. Pursuant to section 7805(f) of the Internal Revenue Code, these regulations have been submitted to the Chief Counsel for Advocacy of the Small Business Administration for comment on their impact on small business.

The principal author of these regulations is Frank W. Dunham III of the Office of the Associate Chief Counsel (International). However, other personnel from the Treasury Department and the IRS participated in the development of the regulations.

Accordingly, 26 CFR part 1 is amended as follows:

An interim final rule amending VA's medical regulations concerning the copayment required for certain medications was published in the Federal Register on October 27, 2014. 79 FR 63819.

VA invited interested persons to submit comments on the interim final rule on or before December 26, 2014, and we received four comments. All four commenters supported the interim final rule, which maintained copayment rates for medications at their current levels throughout 2015. One commenter disagreed with part of the rationale for the rule. VA explained in the interim final rule that part of the rationale for the rule is to reduce the incentive for veterans to seek care from other health care providers and plans, as fragmentation of care can increase the risk of adverse interactions and harm to the patient because it is more difficult for each provider to assess if the patient is taking any other medications.

The commenter further recommended that VA should ensure the ability of non-VA providers to easily communicate with VA to treat patients, monitor prescriptions, and reduce wait times. Normally when VA authorizes care from a non-VA health care provider, we require the provider to submit medical record information to VA so that we have a complete account of what care and treatment was provided to a veteran. Many veterans receive care and services from other providers that are not authorized by VA, and in these situations, our health care providers may not have a complete account of the veteran's care. To the extent that non-VA providers can and do share information with VA, the risk of an adverse event declines, and VA fully supports such efforts. However, since the effect of the rulemaking is to temporarily freeze certain copayments and not establish monitoring or communication standards, VA does not make any changes to this rulemaking.

The commenter also urged VA to allow veterans to fill prescriptions written by civilian family physicians at VA pharmacies to reduce significant financial challenges for veterans and to maintain consistency with the delivery of pharmaceutical benefits to veterans. However, this recommendation is outside the scope of this rulemaking, which deals only with establishing copayment rates for medications prescribed by and filled by VA. Therefore, VA is not making any changes based on this comment.

One commenter suggested extending the freeze for at least an additional two to three years, to alleviate what the commenter deemed an “undue hardship” on veterans caused by increased pharmacy copayments. To the extent that increased pharmacy copayments have been shown to reduce utilization of VA pharmacy benefits (as stated in the interim final rule), we agree with the commenter that extending the freeze for at least one additional year is in the best interest of veterans. We would therefore extend the freeze in this final rule to be effective through December 31, 2016. This extended timeframe would permit the freeze to be in effect all of calendar year 2016 for the continued benefit of veterans, and would allow VA to continue to develop and publish proposed and final rules to implement a tiered copayment structure for medication copayments, which will further align VA's medication copayment structure with other Federal agencies and the commercial sector. Therefore, VA is extending the copay freeze in this final rule to be effective through December 31, 2016.

VA is adding an applicability date paragraph to the preamble to clarify that the amendments made by this rulemaking applied to the copayments discussed herein as of January 1, 2015. This is a clarifying, non-substantive change.

Based on the rationale set out here and in the interim final rule, VA is adopting the provisions of the interim final rule as a final rule with the change to extend the freeze as described above.

Title 38 of the Code of Federal Regulations, as revised by this final rulemaking, represents VA's implementation of its legal authority on this subject. Other than future amendments to this regulation or governing statutes, no contrary guidance or procedures are authorized. All existing or subsequent VA guidance must be read to conform with this rulemaking if possible or, if not possible, such guidance is superseded by this rulemaking.

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 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. This final rule will temporarily freeze the copayments that certain veterans are required to pay for prescription drugs furnished by VA. This final rule directly affects only individuals and will not directly affect small entities. Therefore, pursuant to 5 U.S.C. 605(b), this rulemaking is exempt from the final regulatory flexibility analysis requirements of 5 U.S.C. 604.

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,” requiring review by the Office of Management and Budget (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 that it is a significant regulatory action under Executive Order 12866 because it is likely to result in a regulatory action that may have an annual effect on the economy of $100 million or more. VA's impact analysis can be found as a supporting document at http://www.regulations.gov, usually within 48 hours after the rulemaking document is published. Additionally, a copy of the rulemaking and its impact analysis are available on VA's Web site at http://www.va.gov/orpm/, by following the link for VA Regulations Published from FY 2004 through fiscal year to date.

VA has determined that this regulatory action is considered a major rule under the Congressional Review Act, 5 U.S.C. 801-08, because it may result in an annual effect on the economy of $100 million or more. In the preamble to the interim final rule (79 FR 63819, 63821), we stated that although this regulatory action may constitute a major rule within the meaning of the Congressional Review Act, 5 U.S.C. 804(2), it was not subject to the 60-day delay in effective date applicable to major rules under 5 U.S.C. 801(a)(3) because the Secretary found that good cause existed under 5 U.S.C. 808(2) and made this regulatory action effective on January 1, 2015, consistent with the reasons given for the publication of this regulatory action as an interim final rule. Increasing the copayment amount on January 1, 2015, might have caused a significant financial hardship for some veterans and may have decreased patient adherence to medical plans, and could have had other unpredictable negative health effects. VA anticipates the same risk for financial hardship and decreased patient adherence if copayments were increased in calendar year 2016, and has therefore extended the freeze through December 31, 2016. Accordingly, the Secretary found that additional advance notice and public procedure thereon were impractical, unnecessary, and contrary to the public interest. In accordance with 5 U.S.C. 801(a)(1), VA submitted to the Comptroller General and to Congress a copy of this regulatory action and VA's Regulatory Impact Analysis.

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.

The Catalog of Federal Domestic Assistance numbers and titles for the programs affected by this document are as follows: 64.005, Grants to States for Construction of State Home Facilities; 64.007, Blind Rehabilitation Centers; 64.008, Veterans Domiciliary Care; 64.009, Veterans Medical Care Benefits; 64.010, Veterans Nursing Home Care; 64.011, Veterans Dental Care; 64.012, Veterans Prescription Service; 64.013, Veterans Prosthetic Appliances; 64.014, Veterans State Domiciliary Care; 64.015, Veterans State Nursing Home Care; 64.016, Veterans State Hospital Care; 64.018, Sharing Specialized Medical Resources; 64.019, Veterans Rehabilitation Alcohol and Drug Dependence; 64.022, Veterans Home Based Primary Care; and 64.024, VA Homeless Providers Grant and Per Diem Program.

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 May 5, 2015, for publication.

For the reasons set out in the preamble, VA amends 38 CFR part 17 as follows:

Throughout this document “we,” “us,” or “our” refer to EPA. This section provides additional information by addressing the following:

EPA is taking direct final action to approve SIP revisions submitted by the state of Missouri for 10 CSR 10-6.390, “Control of NOX Emissions from Large Stationary Internal Combustion Engines,” on October 17, 2013. Section (2) of the rule is being amended to move several definitions from this rule to the state's general definitions rule 10 C.S.R. 10-6.020. The definitions being moved to that state's general definitions rule include: Diesel engine, Dual fuel engine, Emergency standby engine, Engine rating, Higher heating value (HHV), Lean-burn engine, Maintenance operation, Output, Peak load, Permitted capacity factor, Rich-burn engine, Stationary internal combustion engine, Stoichiometric air/fuel ration, Unit, and Utilization rate. However, in a subsequent SIP revision amendment to 10 C.S.R 10-6.020 submitted by Missouri on March 27, 2014, approved by EPA and subsequently published in the Federal Register on March 4, 2015 (80 FR 11577), the state amended the rule to remove the following definitions: Engine rating, Peak load, Permitted capacity factor and Stoichiometric air/fuel ratio, because they are obsolete and no longer used in Missouri rules. In paragraph (3)(E)(1), Missouri is making a minor administrative correction. In subsection (3)(F), Missouri is removing the term “kiln” and replacing it with the term “engine” to clarify the rule, EPA is not taking action on any provision of thie rule related to Startup, Shutdown and Malfunction (SSM). Any changes to these portions of the rule must meet the requirements of the final SIP Call related to SSM (June 12, 2015, 80 FR 33840).

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 above, the revision meets the substantive SIP requirements of the CAA, including section 110 and implementing regulations.

We are publishing this rule without a prior proposed rule because we view this as a noncontroversial action and anticipate no adverse comment. However, in the “Proposed Rules” section of the Federal Register, we are publishing a separate document that will serve as the proposed rule to the SIP revision if adverse comments are received on this direct final rule. We will not institute a second comment period on this action. Any parties interested in commenting must do so at this time. For further information about commenting on this rule, see the ADDRESSES section of this document. If EPA receives adverse comment, we will publish a timely withdrawal in the Federal Register informing the public that this direct final rule will not take effect. We will address all public comments in any subsequent final rule based on the proposed rule.

In this rule, EPA is finalizing regulatory text that includes incorporation by reference. In accordance with requirements of 1 CFR 51.5, EPA is finalizing the incorporation by reference of Missouri's rule 10 C.S.R. 10-6.390 described in the direct final amendments to 40 CFR part 52 set forth below. EPA has made, and will continue to make, these documents generally available electronically through www.regulations.gov and/or in hard copy at the appropriate EPA office (see the ADDRESSES section of this preamble for more information).

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 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 action:

• Is not a significant regulatory action subject to review by the Office of Management and Budget under Executive Orders 12866 (58 FR 51735, October 4, 1993) 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 et seq.);

• 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 et seq.);

• 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 health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).

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).

The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this action and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register.

A major rule cannot take effect until 60 days after it is published in the Federal Register. This action is not a “major rule” as defined by 5 U.S.C. 804(2).

Under section 307(b)(1) of the CAA, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by November 16, 2015. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. Parties with objections to this direct final rule are encouraged to file a comment in response to the parallel notice of proposed rulemaking for this action published in the proposed rules section of the Federal Register, rather than file an immediate petition for judicial review of this direct final rule, so that EPA can withdraw this direct final rule and address the comment in the proposed rulemaking. This action may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2).)

For the reasons stated in the preamble, EPA amends 40 CFR part 52 as set forth below:

Throughout this document “we,” “us,” or “our” refer to EPA. This section provides additional information by addressing the following:

The Clean Air Act (CAA) requires that state regulatory agencies implement the emission guidelines and compliance times using a state plan developed under sections 111(d) and 129 of the CAA. Section 111(d) establishes general requirements and procedures on state plan submittals for the control of designated pollutants. Section 129 requires emission guidelines to be promulgated for all categories of sewage sludge incineration units, including sewage sludge incineration (SSI) units. Section 129 mandates that all plan requirements be at least as protective and restrictive as the promulgated emission guidelines. This includes fixed final compliance dates, fixed compliance schedules, and Title V permitting requirements for all affected sources. Section 129 also requires that state plans be submitted to EPA within one year after EPA's promulgation of the emission guidelines and compliance times.

On March 21, 2011, the EPA established emission guidelines and compliance times for existing SSI units. The emission guidelines and compliance times are codified at 40 CFR 60, Subpart MMMM.

The state is issuing a new rule, 10 CSR 10-6.191 for SSI to meet its obligation for this Federal rule. The new rule incorporates by reference the Federal rule. The revised state plan is being issued concurrently with this new rulemaking.

The state originally submitted the adopted plan and corresponding state rule to EPA on April 29, 2013. After submission to EPA, Missouri became aware of errors in the state plan and resubmitted a corrected version of the plan which EPA received on September 20, 2013. EPA has analyzed the corrected version.

The emission guidelines and compliance times are codified in 40 CFR 60, subpart MMMM. State plans must contain specific information and the legal mechanisms necessary to implement the emission guidelines and compliance times. The requirements are as follows:

• Inventory of affected SSI units, including to the best of the state's knowledge, SSI units that have shut down and are capable of restarting.

• Inventory of emissions from affected SSI units in Missouri.

• Compliance schedules for all affected SSI units with a final compliance date no later than March 21, 2016 or three (3) years after the effective date of state plan approval, whichever is earlier.

• Emission limitations, emission standards, operator training and qualification requirements, and operating limits for affected SSI units that are at least as protective as the emission guidelines contained in Subpart MMMM.

• Testing, monitoring, and inspection requirements at least as protective as those in the emission guidelines.

• Performance testing, reporting and recordkeeping requirements at least as protective as those in the emission guidelines.

• Certification that the hearing on the State plan was held, a list of witnesses and organizational affiliations, if any, appearing at the hearing, and a brief written summary of each presentation or written submission.

• Provision for State progress reports to EPA.

• Identification of enforceable State mechanisms that were selected for implementing the emission guidelines of Subpart MMMM.

• Demonstration of Missouri's legal authority to carry out the sections 111(d) and 129 State plan.

The Missouri plan includes documentation that all of these requirements have been met. The emission limits, testing, monitoring, reporting and recordkeeping requirements, and other aspects of the Federal rule have been adopted by reference. Missouri rule 10 CSR 10-6.191 contains the applicable requirements for SSI units. The state provided documentation that it complied with the public notice and comment requirements of 40 CFR part 60 Subpart MMMM.

Based on the rationale discussed above, EPA is approving Missouri's 111(d) plan for Sewage Sludge Incinerators received on September 20, 2013. We are publishing this direct final rule without a prior proposed rule because we view this as a noncontroversial action and anticipate no adverse comment. However, in the “Proposed Rules” section of this Federal Register, we are publishing a separate document that will serve as the proposed rule to approve the revision to the 111(d) plan. If adverse comments are received on this direct final rule. We will not institute a second comment period on this action. Any parties interested in commenting must do so at this time. For further information about commenting on this rule, see the ADDRESSES section of this document.

If EPA receives adverse comment, we will publish a timely withdrawal in the Federal Register informing the public that this direct final rule will not take effect. We will address all public comments in any subsequent final rule based on the proposed rule.

Under Executive Order 12866 (58 FR 51735, October 4, 1993), this action is not a “significant regulatory action” and therefore is not subject to review under Executive Orders 12866 and 13563 (76 FR 3821, January 21, 2011). This action is also not subject to Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355, May 22, 2001). This action merely approves state law as meeting Federal requirements and imposes no additional requirements beyond those imposed by state law. Accordingly, the Administrator certifies that this rulemaking will not have a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.). Because this rulemaking would approve pre-existing requirements under state law and does not impose any additional enforceable duty beyond that required by state law, it 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).

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).

This action also does not have Federalism implications because it does 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, as specified in Executive Order 13132 (64 FR 43255, August 10, 1999). Thus Executive Order 13132 does not apply to this action. This action merely approves a state rule implementing a Federal standard, and does not alter the relationship or the distribution of power and responsibilities established in the CAA. This rulemaking also is not subject to Executive Order 13045, “Protection of Children from Environmental Health Risks and Safety Risks” (62 FR 19885, April 23, 1997) because it approves a state rule implementing a Federal standard.

In reviewing SIP submissions, EPA's role is to approve state choices, provided that they meet the criteria of the CAA. In this context, in the absence of a prior existing requirement for the State to use voluntary consensus standards (VCS), EPA has no authority to disapprove a state submission for failure to use VCS. It would thus be inconsistent with applicable law for EPA when it reviews a state submission, to use VCS in place of a state submission that otherwise satisfies the provisions of the CAA. Thus, the requirements of section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) do not apply. This action does not impose an information collection burden under the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.). Burden is defined at 5 CFR 1320.3(b).

The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this proposed rule and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register.

A major rule cannot take effect until 60 days after it is published in the Federal Register. This action is not a “major rule” as defined by 5 U.S.C. 804(2).

Under section 307(b)(1) of the CAA, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by November 16, 2015. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this rule for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. Parties with objections to this direct final rule are encouraged to file a comment in response to the parallel notice of proposed rulemaking for this action published in the proposed rules section of today's Federal Register, rather than file an immediate petition for judicial review of this direct final rule, so that EPA can withdraw this direct final rule and address the comment in the final rulemaking. This action may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2).)

For the reasons stated in the preamble, EPA amends 40 CFR part 62 as set forth below:

Under 49 U.S.C. 30141(a)(1)(A), a motor vehicle that was not originally manufactured to conform to all applicable FMVSS shall be refused admission into the United States unless NHTSA has decided that the motor vehicle is substantially similar to a motor vehicle originally manufactured for importation into and sale in the United States, certified under 49 U.S.C. 30115, and of the same model year as the model of the motor vehicle to be compared, and is capable of being readily altered to conform to all applicable FMVSS. Where there is no substantially similar U.S.-certified motor vehicle, 49 U.S.C. 30141(a)(1)(B) permits a nonconforming motor vehicle to be admitted into the United States if its safety features comply with, or are capable of being altered to comply with, all applicable FMVSS based on destructive test data or such other evidence as the Secretary of Transportation decides to be adequate.

Under 49 U.S.C. 30141(a)(1), import eligibility decisions may be made “on the initiative of the Secretary of Transportation or on petition of a manufacturer or importer registered under [49 U.S.C. 30141(c)].” The Secretary's authority to make these decisions has been delegated to NHTSA. The agency publishes notices of eligibility decisions as they are made.

Under 49 U.S.C. 30141(b)(2), a list of all vehicles for which import eligibility decisions have been made must be published annually in the Federal Register. On October 1, 1996, NHTSA added the list as an appendix to 49 CFR part 593, the regulations that establish procedures for import eligibility decisions (61 FR 51242). As described in the notice, NHTSA took that action to ensure that the list is more widely disseminated to government personnel who oversee vehicle imports and to interested members of the public. See 61 FR 51242-43. In the notice, NHTSA expressed its intention to annually revise the list as published in the appendix to include any additional vehicles decided by the agency to be eligible for importation since the list was last published. See 61 FR 51243. The agency stated that issuance of the document announcing these revisions will fulfill the annual publication requirements of 49 U.S.C. 30141(b)(2). Ibid.

Executive Order 12866, “Regulatory Planning and Review” (58 FR 51735, October 4, 1993), provides for making determinations about whether a regulatory action is “significant” and therefore subject to Office of Management and Budget (OMB) review and to the requirements of the Executive Order. The Executive Order defines a “significant regulatory action” as one 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 affects 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 the Executive Order. This rule will not have any of these effects and was not reviewed under Executive Order 12866. It is not significant within the meaning of the DOT Regulatory Policies and Procedures. The effect of this rule is not to impose new requirements. Instead it provides a summary compilation of decisions on import eligibility that have already been made and does not involve new decisions. This rule will not impose any additional burden on any person. Accordingly, the agency believes that the preparation of a regulatory evaluation is not warranted for this rule.

We have not conducted an evaluation of the impacts of this rule under the National Environmental Policy Act. This rule does not impose any change that would result in any impacts to the quality of the human environment. Accordingly, no environmental assessment is required.

Pursuant to the Regulatory Flexibility Act, we have considered the impacts of this rule on small entities (5 U.S.C. Sec. 601 et seq.). I certify that this rule will not have a significant economic impact upon a substantial number of small entities within the context of the Regulatory Flexibility Act. The following is our statement providing the factual basis for the certification (5 U.S.C. Sec. 605(b)). This rule will not have any significant economic impact on a substantial number of small businesses because the rule merely furnishes information by revising the list in the Code of Federal Regulations of vehicles for which import eligibility decisions have previously been made. Accordingly, we have not prepared a Final Regulatory Flexibility Analysis.

Executive Order 13132 requires NHTSA to develop an accountable process to ensure “meaningful and timely input by State and local officials in the development of regulatory policies that have federalism implications.” Executive Order 13132 defines the term “Policies that have federalism implications” to include regulations that 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.” Under Executive Order 13132, NHTSA may not issue a regulation that has federalism implications, that imposes substantial direct compliance costs, and that is not required by statute, unless the Federal government provides the funds necessary to pay the direct compliance costs incurred by State and local governments, or NHTSA consults with State and local officials early in the process of developing the regulation.

This rule will have no direct effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government as specified in Executive Order 13132. Thus, the requirements of section 6 of the Executive Order do not apply to this rule.

The Unfunded Mandates Reform Act of 1995 (Public Law 104-4) requires agencies to prepare a written assessment of the costs, benefits and other effects of proposed or final rules that include a Federal mandate likely to result in the expenditure by State, local or tribal governments, in the aggregate, or by the private sector, of more than $100 million annually. This rule will not result in additional expenditures by State, local or tribal governments or by any members of the private sector. Therefore, the agency has not prepared an economic assessment pursuant to the Unfunded Mandates Reform Act.

Under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.), a person is not required to respond to a collection of information by a Federal agency unless the collection displays a valid OMB control number. This rule does not impose any new collection of information requirements for which a 5 CFR part 1320 clearance must be obtained. DOT previously submitted to OMB and OMB approved the collection of information associated with the vehicle importation program in OMB Clearance No. 2127-0002.

Pursuant to Executive Order 12988, “Civil Justice Reform,” we have considered whether this rule has any retroactive effect. We conclude that it will not have such an effect.

Executive Order 12866 requires each agency to write all rules in plain language. Application of the principles of plain language includes consideration of the following questions:

If you wish to do so, please comment on the extent to which this final rule effectively uses plain language principles.

Under the National Technology and Transfer and Advancement Act of 1995 (Pub. L. 104-113), “all Federal agencies and departments shall use technical standards that are developed or adopted by voluntary consensus standards bodies, using such technical standards as a means to carry out policy objectives or activities determined by the agencies and departments.”

This rule does not require the use of any technical standards.

Anyone is able to search the electronic form of all comments received into any of our dockets by the name of the individual submitting the comment (or signing the comment, if submitted on behalf of an association, business, labor union, etc.). You may review DOT's complete Privacy Act Statement in the Federal Register published on April 11, 2000 (Volume 65, Number 70; Pages 19477-78).

This rule is not subject to Executive Order 13045 because it is not “economically significant” as defined under Executive Order 12866, and does not concern an environmental, health, or safety risk that NHTSA has reason to believe may have a disproportionate effect on children.

NHTSA finds that prior notice and opportunity for comment are unnecessary under 5 U.S.C. 553(b)(3)(B) because this action does not impose any regulatory requirements. This rule merely revises the list of vehicles not originally manufactured to conform to the FMVSS that NHTSA has decided to be eligible for importation into the United States since the last list was published in September, 2014.

In addition, so that the list of vehicles for which import eligibility decisions have been made may be included in the next edition of 49 CFR parts 572 to 999, which is due for revision on October 1, 2015, good cause exists to dispense with the requirement in 5 U.S.C. 553(d) for the effective date of the rule to be delayed for at least 30 days following its publication.

In consideration of the foregoing, Part 593 of Title 49 of the Code of Federal Regulations, Determinations that a vehicle not originally manufactured to conform to the Federal motor vehicle safety standards is eligible for importation, is amended as follows: