Federal Register Vol. 80, No.226,

The Federal Deposit Insurance Corporation (FDIC), in regulations codified at 12 CFR 360.6 (the Securitization Safe Harbor Rule), set forth criteria under which in its capacity as receiver or conservator of an insured depository institution the FDIC will not, in the exercise of its authority to repudiate contracts, recover or reclaim financial assets transferred in connection with securitization transactions. Asset transfers that, under the Securitization Safe Harbor Rule, are not subject to recovery or reclamation through the exercise of the FDIC's repudiation authority include those that pertain to certain grandfathered transactions, such as, for example, asset transfers made prior to December 31, 2010 that satisfied the conditions (except for the legal isolation condition addressed by the Securitization Safe Harbor Rule) for sale accounting treatment under generally accepted accounting principles (GAAP) in effect for reporting periods prior to November 15, 2009 and that pertain to a securitization transaction that satisfied certain other requirements. In addition, the Securitization Safe Harbor Rule provides that asset transfers that are not grandfathered, but that satisfy the conditions (except for the legal isolation condition addressed by the Securitization Safe Harbor Rule) for sale accounting treatment under GAAP in effect for reporting periods after November 15, 2009 and that pertain to a securitization transaction that satisfies all other conditions of the Securitization Safe Harbor Rule (such asset transfers, together with grandfathered asset transfers, are referred to collectively as Safe Harbor Transfers) will not be subject to FDIC recovery or reclamation actions through the exercise of the FDIC's repudiation authority. For any securitization transaction in respect of which transfers of financial assets do not qualify as Safe Harbor Transfers but which transaction satisfies all of its other requirements, the Securitization Safe Harbor Rule provides that, in the event the FDIC as receiver or conservator remains in monetary default for a specified period under a securitization due to its failure to pay or apply collections or repudiates the securitization asset transfer agreement and does not pay damages within a specified period, certain remedies can be exercised on an expedited basis.

Paragraph (b)(5)(i) of the Securitization Safe Harbor Rule sets forth the conditions relating to credit risk retention that apply to transfers of financial assets in connection with securitizations that are not grandfathered by the Securitization Safe Harbor Rule. Under paragraph (b)(5)(i)(A) of the Securitization Safe Harbor Rule as currently in effect, prior to the effective date of regulations required under Section 15G of the Securities Exchange Act, 15 U.S.C. 78a et seq. (“Section 15G”), the documents governing such securitization must require that the sponsor retain an economic interest in not less than five (5) percent of the credit risk of the financial assets relating to the securitization. The requirement in paragraph (b)(5)(i)(A) of the Securitization Safe Harbor Rule, that the documents require retention of an economic interest, is consistent with many other provisions of the Securitization Safe Harbor Rule, which are similarly expressed as requirements for the securitization documentation, rather than as conditions requiring actual compliance with the provision that is required to be included in the documentation. As currently in effect, paragraph (b)(5)(i)(B) of the Securitization Safe Harbor Rule does not explicitly refer to the securitization documentation, but provides that, upon the effective date of the regulations required under Section 15G (the Section 15G Regulations), such regulations shall exclusively govern the requirement to retain an economic interest in the credit risk of the financial assets.

Section 15G provides that regulations issued thereunder become effective with respect to residential mortgage securitizations one year after the date on which the regulations are published in the Federal Register and, with respect to all other securitizations, two years after such publication date. The Section 15G Regulations were published in the Federal Register at 79 FR 77602 on December 24, 2014. The Federal Register publication of the Section 15G Regulations specifies “compliance dates” that correspond to these effective dates. However, the Federal Register publication also specifies February 23, 2015 as the “effective date” of the Section 15G Regulations in accordance with Federal Register editorial conventions, which require that a Federal Register publication specify as the effective date the date on which a rule affects the current Code of Federal Regulations.1

In connection with the notice of proposed rulemaking relating to the Section 15G Regulations, FDIC staff received a comment that suggested that certain other points relating to paragraph (b)(5)(i)(B) of the Securitization Safe Harbor Rule should be clarified.

On January 30, 2015, the FDIC published a notice of proposed rulemaking relating to the Securitization Safe Harbor Rule (the “NPR”). The NPR was designed, in part, to eliminate any confusion that might be created by the use of “effective date” in the Section 15G Regulations Federal Register publication and to clarify when compliance with paragraph (b)(5)(i)(B) of the Securitization Safe Harbor Rule is required. In addition, the NPR included a proposed rule (the Proposed Rule) that addressed two of the points raised by the commenter.2 The first is a clarification that paragraph (b)(5)(i)(B) was intended to require that, upon and following the applicable effective date under the Section 15G Regulations (such applicable effective dates (December 24, 2015 for residential mortgage securitizations and December 24, 2016 for all other securitizations) are referred to as the applicable compliance dates), the Securitization Safe Harbor Rule requirements as to risk retention are satisfied if the governing documents of a securitization transaction require retention of an economic interest in the financial assets in accordance with the Section 15G Regulations, and that if the documentation satisfies this condition (and assuming all other conditions of the Securitization Safe Harbor Rule are satisfied), the transaction will not lose the benefits of the safe harbor solely on the basis of any non-compliance with the Section 15G Regulations risk retention requirements.

The second is a clarification that paragraph (b)(5)(i)(B) of the Securitization Safe Harbor Rule does not require that any action be taken with respect to issuances of asset-backed securities that close prior to the applicable compliance date of the Section 15G Regulations.

These two clarifications, which were included in the Proposed Rule, together with an additional change suggested by a comment letter relating to the Proposed Rule, are included in the Final Rule.

The FDIC received one comment letter, from an industry trade association, in response to the Proposed Rule. This letter supported the changes included in the Proposed Rule and requested that the Final Rule include one additional change relating to the credit risk retention condition of the Securitization Safe Harbor Rule. The commenter referred to the applicable compliance dates for the Section 15G Regulations and proposed that the Final Rule provide securitization sponsors the option, with respect to a securitization transaction, to comply with the credit risk retention condition of the Securitization Safe Harbor Rule by adopting the Section 15G risk retention requirements during the period preceding the applicable compliance date for such transaction, even though the Section 15G Regulations do not require such compliance before such applicable compliance date. The commenter stated that providing such optionality “would effectuate the principle underlying the credit risk retention condition of the Securitization Safe Harbor Rule.” 3

The policy objective underlying the Final Rule is to create certainty and eliminate unnecessary burdens in connection with the transition to the Section 15G Regulations requirements as to credit risk retention.

The Final Rule clarifies that the Securitization Safe Harbor Rule condition relating to credit risk retention requires that the documents governing a securitization transaction that closes on or after the applicable compliance date under the Section 15G Regulations must require that an economic interest in the credit risk of the financial assets is retained in accordance with the Section 15G Regulations. The Final Rule provision effecting this clarification also makes clear that the migration of the Securitization Safe Harbor Rule to the Section 15G Regulations governing credit risk retention will not require changes to documents governing securitizations that closed prior to the applicable compliance date. The provision also makes clear that the transition to the Section 15G standard is a documentation requirement and, thus, does not put investors at risk if a securitization sponsor, in violation of transaction documents, does not retain credit risk in accordance with the Section 15G Regulations.

Because securitization investors have relied on the Securitization Safe Harbor Rule to obtain an understanding of how the FDIC might exercise its powers if it is appointed receiver or conservator for an insured depository institution which transferred assets in connection with a securitization transaction, the FDIC believes that it is important to make clear to securitization market participants the date upon and after which the Securitization Safe Harbor will require reference to the Section 15G Regulations. In addition, the FDIC wants to eliminate possible confusion among market participants as to whether an asset-backed security issuance that complies with all requirements of the Securitization Safe Harbor Rule could forfeit the benefits afforded by the Securitization Safe Harbor Rule based on the action or inaction of a securitization sponsor or other party with respect to retention of credit risk following the date of such issuance. This is different from the Section 15G Regulations, under which non-compliance with the credit risk retention requirements will constitute a violation of the Regulations.

Consistent with the clarifications to the process for migration to the Section 15G Regulations included in the Proposed Rule, the Final Rule follows the commenter's suggestion and permits securitization sponsors to comply with the credit risk retention requirements of the Securitization Safe Harbor Rule by opting in the securitization's governing documents to require compliance with the Section 15G Regulations earlier than required by the Section 15G Regulations. It is the FDIC's view that since the Securitization Safe Harbor Rule has always required the transition to the Section 15G risk retention requirements, there is no compelling reason to require that securitization sponsors await the applicable compliance date in order to use one of the risk retention methods available under the Section 15G Regulations. In following the commenter's proposal, the FDIC wished to avoid imposing unnecessary burdens on sponsors that otherwise might need to establish a securitization structure for the issuance of multiple series before the applicable compliance date and then need to amend the structure after the applicable compliance date. The FDIC sees no reason to require such extra expense. The FDIC recognizes that permitting securitization sponsors to cause a securitization transaction to comply with the Securitization Safe Harbor Rule by exercising an option to require compliance with the Section 15G Regulations before the applicable compliance date also has the effect of allowing greater flexibility with respect to risk retention for purposes of complying with the Securitization Safe Harbor Rule, and in some cases may permit sponsors to benefit from exemptions available under the Section 15G Regulations earlier than otherwise would be the case for purposes of the Securitization Safe Harbor Rule. In promulgating the Section 15G Regulations, the FDIC determined that the approach to risk retention adopted by those rules is effective and appropriate and, thus, the option of early adoption also is appropriate.

The Final Rule adds a new definition, “applicable compliance date” to paragraph (a) of the Securitization Safe Harbor Rule. This definition reflects that the Section 15G Regulations impose two dates for compliance: December 24, 2015 for securitization of residential mortgages, and December 24, 2016 for all other securitizations.

The Final Rule revises paragraph (b)(5)(i) of the Securitization Safe Harbor Rule to make the following three points clear:

(i) In order to qualify for the benefits of the Securitization Safe Harbor Rule, the documents governing the issuance of asset-backed securities in a securitization transaction must require retention of an economic interest in the credit risk of the financial assets relating to the securitization transaction in compliance with the Section 15G Regulations if such issuance occurs upon or following the date on which compliance with Section 15G is required for such type of securitization transaction;

(ii) The Securitization Safe Harbor Rule does not require inquiry as to whether the sponsor or other applicable party in fact complies with the risk retention requirements of the documentation; and

(iii) The Securitization Safe Harbor Rule requirements as to the Section 15G Regulations do not require changes to securitization documents governing asset-backed security issuances that are closed prior to the applicable compliance date under the Section 15G Regulations.

In addition, the Final Rule revises paragraph (b)(5)(i) of the Securitization Safe Harbor Rule to permit a securitization transaction, that closes between the date of the publication of the Final Rule in the Federal Register and the applicable compliance date related to such securitization transaction, to comply with the paragraph if the documents creating the securitization require retention of an economic interest in the credit risk of the financial assets in accordance with the requirements of the Section 15G Regulations as though such Regulations were then in effect. In the case of a securitization transaction of an entity established to issue obligations in more than one securitization transaction, the election to require in the documents creating the securitization transaction that risk be retained in accordance with the Section 15G Regulations can be set forth either in the specific securitization transaction documents or, provided that it governs the securitization transaction, in one of the documents establishing or otherwise governing the issuing entity.

This rule would entail an information collection for sponsors that exercise the option to become subject to the Section 15G Regulations earlier than otherwise required. Because the information to be collected is the same, however, as that encompassed by the collection of information that was approved under OMB No. 3064-0183, no new submission is being made to OMB with respect to the Paperwork Reduction Act (44 U.S.C. 3501, et seq.).4

The Regulatory Flexibility Act 5 U.S.C. 601, et seq. (RFA) requires each federal agency to prepare a final regulatory flexibility analysis in connection with the promulgation of a final rule, or certify that the final rule will not have a significant economic impact on a substantial number of small entities.5 Pursuant to section 605(b) of the Regulatory Flexibility Act, the FDIC certifies that the Final Rule will not have a significant economic impact on a substantial number of small entities.

The Office of Management and Budget has determined that the Final Rule is Not a “major rule” within the meaning of the Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA), (5 U.S.C. 801 et seq.). As required by the SBREFA, the FDIC will file the appropriate reports with Congress and the Government Accountability Office so that the Final Rule may be reviewed.

Section 722 of the Gramm-Leach-Bliley Act (Pub. L. 106-102, 113 Stat.1338, 1471), requires the Federal banking agencies to use plain language in all proposed and final rules published after January 1, 2000. The FDIC has sought to present the Final Rule in a simple and straightforward manner.

For the reasons stated above, the Board of Directors of the Federal Deposit Insurance Corporation amends 12 CFR part 360 as follows:

FHFA is an independent agency of the federal government established to regulate and oversee the Federal National Mortgage Association (Fannie Mae), the Federal Home Loan Mortgage Corporation (Freddie Mac) (collectively, the Enterprises), and the Federal Home Loan Banks (Bank(s)) (collectively, the regulated entities).1 FHFA is the primary federal financial regulator of each regulated entity. FHFA's regulatory mission is to ensure, among other things, that each of the regulated entities “operates in a safe and sound manner” and that their “operations and activities . . . foster liquid, efficient, competitive, and resilient national housing finance markets.” 2

On September 26, 2013, FHFA published a final rule implementing section 165(i)(2) of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act),3 which requires certain financial companies with total consolidated assets of more than $10 billion to conduct annual stress tests to determine whether the companies have the capital necessary to absorb losses as a result of adverse economic conditions. Each regulated entity is covered by this Dodd-Frank Act requirement. FHFA's regulation, located at 12 CFR part 1238, requires each regulated entity to conduct an annual stress test based on scenarios provided by FHFA and consistent with FHFA prescribed methodologies and practices. The rule requires the annual stress test period to begin October 1 of one year and end September 30 of the next year, which coincided with the testing period established by Federal Reserve Board (FRB) regulations for its Dodd-Frank Act stress testing.

FHFA's regulation also requires that the Agency issue to the regulated entities stress test scenarios that are generally consistent with and comparable to those developed by the FRB not later than 15 days after the FRB publishes its scenarios.4 Each regulated entity is required to report the stress test results to FHFA and the FRB and publicly disclose a summary of the stress test results for the severely adverse scenario. The reporting date for the Enterprises is on or before February 5, and for the Banks it is on or before April 30.5 The date for each Enterprise to publicly disclose its results from the severely adverse scenario of the stress test is the period between April 15 and April 30.6 The Banks are required to disclose their summaries between July 15 and July 30.7 Maintaining consistency with the FRB testing rules, these dates were established by measuring forward from the corresponding dates in the FRB regulation, after accounting for differences in the business models of the regulated entities from those of the institutions regulated by the FRB.

On October 27, 2014, the FRB published a final rule amending several dates relevant to its rule and from which FHFA measured to determine appropriate dates for stress testing cycles, scenario issuance, test reporting, and summary test disclosures.8 The effect of the rule change shifts the date for scenario issuance by approximately three months. The FRB's new rule establishes January 1 of each year as the beginning of the stress testing cycle (changed from October 1) and the following December 31 as the date as of which the regulated entity is to identify and use data for testing.9 The new FRB rule requires large bank holding companies with $50 billion or more in total consolidated assets to report their test results not later than April 5 10 and publicly disclose their summary results by mid-July.11 The new FRB rule also requires U.S. banking institutions with total consolidated assets over $10 billion and less than $50 billion to report their test results by July 31 and publicly disclose their results during the period beginning October 15 and ending October 31.12 Since FHFA measured several of its regulatory dates from corresponding dates in the FRB regulation, FHFA is amending its regulation to maintain consistency and comparability in stress testing regimes.

The final rule realigns FHFA's stress testing rule with those of the FRB, Federal Deposit Insurance Corporation (FDIC) and the Office of the Comptroller of the Currency (OCC) by modifying: (1) The start date of the stress test cycles from October 1 of a calendar year to January 1 of the following calendar year; (2) the dates regulated entities are required to report stress test results to FHFA and the FRB; (3) the dates by which the regulated entities are required to publicly disclose summaries of the results for the severely adverse scenario; and (4) the date by which FHFA is required to issue stress testing scenarios to its regulated entities.

As a result of FHFA's experience through two stress test cycles, these amendments also lengthen the time between FRB's issuance of its scenarios and FHFA's issuance. The original rule's 15 day period after FRB's issuance has proven to be too short to allow appropriate analysis, stakeholder input, and adjustment of the scenarios to account for the differences in business models between the Enterprises and Banks as compared with other regulated institutions conducting Dodd-Frank stress tests under their regulators' rules. Consequently, FHFA is extending the time by which it is required to issue its scenarios to 30 calendar days following FRB's issuance of its final element of the supervisory scenarios.

On August 21, 2015, FHFA published in the Federal Register proposed amendments to the Dodd-Frank stress testing requirements for the regulated entities. The comment period closed on September 21, 2015. FHFA did not receive any comments. Therefore, FHFA is adopting as its final rule the same rule proposed on August 21, 2015, without any change.

Section 1238.3 of the rule changes the “as of” date for the data used for stress testing from September 30 of that calendar year to December 31 of the previous calendar year. As a result of the shift, the stress test cycles would begin on January 1, based on data as of December 31 of the preceding calendar year. This cycle matches the cycle recently adopted by the other Dodd-Frank stress testing regulators.

Section 1238.3(b) lengthens the amount of time by which FHFA commits to providing a description of the baseline, adverse, and severely adverse scenarios to all regulated entities from within 15 calendar days to within 30 calendar days after the FRB publishes its scenarios. This will provide additional time for FHFA to analyze and adjust the scenarios it issues to the Enterprises and Banks.

Section 1238.5 changes the date by which stress test results are required to be reported to the FRB and FHFA. Instead of February 5 of each year, reports are required on or before May 20 for the Enterprises. Instead of April 30 of each year, reports are required on or before August 31 for the Banks. These changes reflect the shift in the stress test cycle and corresponding reporting dates adopted by the FRB and other regulators.

Section 1238.7 specifies a two week period within which the mandatory publication of a summary of the stress test results for the severely adverse scenario must occur. Instead of requiring publication between April 15 and April 30, the Enterprises must publish between August 1 and August 15 of each year. Instead of requiring publication between July 15 and July 30, the Banks must publish between November 15 and November 30 of each year. These changes reflect the shift in the stress test cycle and corresponding publication dates adopted by the FRB and other regulators.

In accordance with section 165(i)(2)(C) of the Dodd-Frank Act, (12 U.S.C. 5365(i)(2)(C)), FHFA has coordinated with both the FRB and the Federal Insurance Office (FIO). On October 27, 2014, the FRB published a final rule covering “bank holding compan[ies] with total consolidated assets of greater than $10 billion but less than $50 billion and savings and loan holding companies and state member banks with total consolidated assets of greater than $10 billion,” 13 and large bank holding companies and non-bank financial companies, also known as “covered companies” 14 ; the FDIC issued its final rule on November 21, 2014,15 and the OCC issued its final rule on December 3, 2014.16 Although FHFA's final rule would not be identical to those of the FRB, the FDIC, and the OCC, it is consistent and comparable with them.

We issued a notice of proposed rulemaking (NPRM) to amend 14 CFR part 39 to supersede AD 2008-22-20, Amendment 39-15717 (73 FR 66747, November 12, 2008). AD 2008-22-20 applied to certain Airbus Model A330-200, A330-300, and A340-300 series airplanes. The NPRM published in the Federal Register on March 17, 2015 (80 FR 13799). The NPRM was prompted by a determination from a fatigue and damage tolerance evaluation that the compliance times must be reduced. The NPRM also proposed to shorten certain compliance times. We are issuing this AD to prevent fatigue cracking of the upper shell structure of the fuselage, which could result in reduced structural integrity of the airplane.

The European Aviation Safety Agency (EASA), which is the Technical Agent for the Member States of the European Union, has issued EASA Airworthiness Directive 2014-0012R1, dated January 24, 2014 (referred to after this as the Mandatory Continuing Airworthiness Information, or “the MCAI”), to correct an unsafe condition for certain Airbus Model A330-200, A330-300, and A340-300 series airplanes. The MCAI states:

You may examine the MCAI in the AD docket on the Internet at http://www.regulations.gov/#!documentDetail;D=FAA-2015-0490-0002.

We gave the public the opportunity to participate in developing this AD. The following presents the comments received on the NPRM (80 FR 13799, March 17, 2015) and the FAA's response to each comment.

An anonymous commenter agreed with the safety benefit provided by the NPRM (80 FR 13799, March 17, 2015).

Delta requested that we revise the NPRM (80 FR 13799, March 17, 2015) to relay the heavy impact of accomplishing Airbus Service Bulletin A330-53-3160, Revision 03, dated January 6, 2012. Delta explained that the modification specified in Airbus Service Bulletin A330-53-3160, Revision 03, dated January 6, 2012, requires removal of the vertical stabilizer and the aft galley, which can heavily impact the operation. Delta reasoned that it has consulted with its maintenance organization and it is estimated to take 400 work-hours instead of 208 work-hours.

We disagree with the request to revise this AD. We made the cost estimate based on the information provided in Airbus Service Bulletin A330-53-3160, Revision 03, dated January 6, 2012. The required work-hours defined in Airbus Service Bulletin A330-53-3160, Revision 03, dated January 6, 2012, are based on the direct labor cost to do the work. The need to remove and reinstall the aft galley depends on the airplane interior configuration and may differ from operator to operator. We are unable to determine all possible interior configurations and thus determine the maximum work-hours which may be required for any specific configuration. This estimate assumes that the work will be done by experienced personnel, and may need to be revised upwards to suit an operator's circumstances. The estimate does not include the time to prepare, plan, or inspect the work. We have made no changes to this AD in this regard.

We reviewed the available data and determined that air safety and the public interest require adopting this AD as proposed except for minor editorial changes. We have determined that these minor changes:

• Are consistent with the intent that was proposed in the NPRM (80 FR 13799, March 17, 2015) for correcting the unsafe condition; and

• Do not add any additional burden upon the public than was already proposed in the NPRM (80 FR 13799, March 17, 2015).

Airbus has issued the following service information.

• Airbus Service Bulletin A330-53-3159, Revision 02, dated March 29, 2010, describes procedures for a modification of the fuselage, which includes inspections (e.g., eddy current rotating probe test of fastener holes for cracking, high frequency eddy current (HFEC) inspections for cracking of the upper shell structure of the fuselage, and checks of the fastener position for clearance) and applicable corrective actions (e.g., repair and rework).

• Airbus Service Bulletin A330-53-3160, Revision 03, dated January 6, 2012, describes procedures for applicable actions, including an eddy current rotating probe test for cracking of the fastener holes and an HFEC inspection for cracks in the upper shell of the fuselage (and including checks of the fastener position for clearance and applicable corrective actions (e.g., repair and rework)), and a modification of the airplane upper shell structure of the fuselage between FR80 and FR86.

• Airbus Service Bulletin A330-53-3168, Revision 02, dated December 21, 2011, describes procedures for a HFEC inspection for cracking of the upper shell structure of the fuselage between FR80 and FR86.

• Airbus Service Bulletin A340-53-4165, Revision 02, dated March 29, 2010, describes procedures for a modification of the fuselage, which includes inspections (e.g., eddy current rotating probe test of fastener holes for cracking, HFEC inspections for cracking of the upper shell structure of the fuselage, and checks of the fastener position for clearance) and applicable corrective actions (e.g., repair and rework).

• Airbus Service Bulletin A340-53-4172, Revision 01, dated July 8, 2009, describes procedures for inspections (e.g., rototest inspections of fastener holes for cracking, HFEC inspections for cracking of the upper shell structure of the fuselage, and checks of the fastener position for clearance) and modification of the airplane upper shell structure between FR80 and FR86 (including applicable corrective actions (e.g., repair and rework).

• Airbus Service Bulletin A340-53-4174, Revision 02, dated December 21, 2011, describes procedures for a HFEC inspection for cracking of the upper shell structure of the fuselage between FR80 and FR86.

This service information is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the ADDRESSES section of this AD.

We estimate that this AD affects 26 airplanes of U.S. registry. We also estimate that it will take about 208 work-hours per product to comply with the basic requirements (inspection and modification) of this AD. The average labor rate is $85 per work-hour. Required parts will cost about $28,360 per product. Based on these figures, we estimate the cost of this AD on U.S. operators to be $1,197,040, or $46,040 per product.

We have received no definitive data that will enable us to provide cost estimates for the on-condition actions specified in this AD.

According to the manufacturer, some of the costs of this AD may be covered under warranty, thereby reducing the cost impact on affected individuals. We do not control warranty coverage for affected individuals. As a result, we have included all costs in our cost estimate.

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.

We determined that 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 the 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.

You may examine the AD docket on the Internet at http://www.regulations.gov/#!docketDetail;D=FAA-2015-0490; or in person at the Docket Management Facility between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains this AD, the regulatory evaluation, any comments received, and other information. The street address for the Docket Operations office (telephone 800-647-5527) is in the ADDRESSES section.

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 ATR—GIE Avions de Transport Régional Model ATR42 and ATR72 airplanes. The NPRM published in the Federal Register on April 10, 2015 (80 FR 19246).

The European Aviation Safety Agency (EASA), which is the Technical Agent for the Member States of the European Union, has issued EASA Airworthiness Directive 2014-0074, dated March 21, 2014 (referred to after this as the Mandatory Continuing Airworthiness Information, or “the MCAI”), to correct an unsafe condition for all ATR—GIE Avions de Transport Régional Model ATR42 and ATR72 airplanes. The MCAI states:

You may examine the MCAI in the AD docket on the Internet at http://www.regulations.gov/#!documentDetail;D=FAA-2015-0682-0002.

We gave the public the opportunity to participate in developing this AD. We received no comments on the NPRM (80 FR 19246, April 10, 2015) or on the determination of the cost to the public.

We reviewed the relevant data and determined that air safety and the public interest require adopting this AD as proposed except for minor editorial changes. We have determined that these minor changes:

• Are consistent with the intent that was proposed in the NPRM (80 FR 19246, April 10, 2015) for correcting the unsafe condition; and

• Do not add any additional burden upon the public than was already proposed in the NPRM (80 FR 19246, April 10, 2015).

Messier-Bugatti-Dowty has issued the following service information, which describes procedures for inspecting the MLG hinge pin.

• Service Bulletin 631-32-213, dated December 16, 2013.

• Service Bulletin 631-32-214, dated January 13, 2014.

• Service Bulletin 631-32-215, dated January 13, 2014.

• Service Bulletin 631-32-216, Revision 1, dated December 17, 2013.

• Service Bulletin 631-32-219, dated March 3, 2014.

• Service Bulletin 631-32-220, dated March 3, 2014.

This service information is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the ADDRESSES section of this AD.

We estimate that this AD affects 81 airplanes of U.S. registry.

We also estimate that it will take about 8 work-hours per product to comply with the basic requirements of this AD. The average labor rate is $85 per work-hour. Required parts will cost about $16,000 per product. Based on these figures, we estimate the cost of this AD on U.S. operators to be $1,351,080, or $16,680 per product.

According to the manufacturer, some of the costs of this AD may be covered under warranty, thereby reducing the cost impact on affected individuals. We do not control warranty coverage for affected individuals. As a result, we have included all costs in our cost estimate.

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.

We determined that 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 the 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.

You may examine the AD docket on the Internet at http://www.regulations.gov/#!docketDetail;D=FAA-2015-0682; or in person at the Docket Management Facility between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains this AD, the regulatory evaluation, any comments received, and other information. The street address for the Docket Operations office (telephone 800-647-5527) is in the ADDRESSES section.

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 Airbus Model A318, A319, A320, and A321 series airplanes. The NPRM published in the Federal Register on March 5, 2015 (80 FR 11960). The NPRM was prompted by a determination that, in specific flight conditions, the allowable load limits on the vertical tail plane could be reached and possibly exceeded. Exceeding allowable load could result in detachment of the vertical tail plane. The NPRM proposed to require modification of the pin programming of the FWC to activate the SRIW logic; and an inspection to determine the part numbers of the FWC and the FAC, and replacement of the FWC and FAC if necessary. We are issuing this AD to prevent detachment of the vertical tail plane and consequent loss of control of the airplane.

The European Aviation Safety Agency (EASA), which is the Technical Agent for the Member States of the European Union, has issued EASA Airworthiness Directive 2014-0217R1, dated February 26, 2015 (referred to after this as the Mandatory Continuing Airworthiness Information, or “the MCAI”), to correct an unsafe condition. The MCAI states:

In addition, this AD requires, prior to or concurrent with modification of an airplane with the activation of the SRIW, upgrades of the FAC and FWC to introduce the SRIW logic and SRIW aural capability, respectively. After modification, this AD prohibits installation of FWCs and FACs having certain part numbers. You may examine the MCAI in the AD docket on the Internet at http://www.regulations.gov/#!documentDetail;D=FAA-2015-0251-0003.

We gave the public the opportunity to participate in developing this AD. The following presents the comments received on the NPRM (80 FR 11960, March 5, 2015) and the FAA's response to each comment.

Airbus requested that we refer to revised service information.

We agree with the Airbus request to refer to revised service information. No additional work is required by the revised service information. We have revised paragraph (g) of this AD to refer to Airbus Service Bulletin A320-22-1480, Revision 02, dated March 30, 2015. We have added new paragraph (m)(1) of this AD to provide credit for the actions required by paragraph (g) of this AD, if those actions were performed before the effective date of this AD using Airbus Service Bulletin A320-22-1480, dated July 9, 2014; or Airbus Service Bulletin A320-22-1480, Revision 01, dated February 6, 2015.

We have revised paragraph (i) of this AD to refer in part to the following service information.

• Airbus Service Bulletin A320-22-1427, Revision 05, including Appendix 01, dated November 24, 2014 (FAC 622 hard B).

• Airbus Service Bulletin A320-22-1447, Revision 03, dated April 21, 2015 (FAC CAA02 hard C).

• Airbus Service Bulletin A320-22-1454, dated February 12, 2014 (FAC CAA02).

• Airbus Service Bulletin A320-22-1461, Revision 07, including Appendix 01, dated March 23, 2015 (FAC B623 hard B).

• Airbus Service Bulletin A320-22-1502, dated November 14, 2014 (FAC CAA02).

We have redesignated paragraph (m) of the proposed AD (80 FR 11960, March 5, 2015) as new paragraph (m)(2) of this AD to provide credit for the actions required by paragraph (i) of this AD, if those actions were performed before the effective date of this AD using the following additional service information.

• Airbus Service Bulletin A320-22-1427, Revision 04, dated February 11, 2014.

• Airbus Service Bulletin A320-22-1447, Revision 01, dated September 18, 2014.

• Airbus Service Bulletin A320-22-1447, Revision 02, dated December 2, 2014.

• Airbus Service Bulletin A320-22-1461, Revision 04, dated September 15, 2014.

• Airbus Service Bulletin A320-22-1461, Revision 05, dated November 13, 2014.

• Airbus Service Bulletin A320-22-1461, Revision 06, dated January 21, 2015.

United Airlines (UAL) requested that we split paragraph (h)(3)(iv) of the proposed AD (80 FR 11960, March 5, 2015) into two paragraphs to clarify the approved parts. UAL stated that paragraphs (h)(3)(i), (h)(3)(ii), and (h)(3)(iii) of the proposed AD clearly denote three of the four possible standards of FAC, but paragraph (h)(3)(iv) of the proposed AD leads one to believe that a FAC CAA02 hard C is required regardless of the airplane configuration.

We agree with UAL's request to clarify the FWCs and FACs having the part numbers that are compatible with SRIW activation required by paragraph (g) of this AD. We have revised paragraph (h)(3)(iv) of the AD to state that for all airplanes configured with an FAC standard CAA01, an FAC having soft P/N G2856AAA02 installed on hard P/N C13206AA00 (CAA02 hard C) are compatible with SRIW activation required by paragraph (g) of this AD. We have added new paragraph (h)(3)(v) of this AD to state that for all airplane configurations, an FWC having P/N 350E053021212 (H2-F7) are compatible with SRIW activation required by paragraph (g) of this AD.

The National Transportation Safety Board (NTSB) stated that there are differences between the Airbus Model A300/A310 series airplane SRIW system and the Airbus Model A320 series airplane SRIW system. The NTSB explained that the Model A300/A310 series airplane SRIW contains a red warning light on the glareshield, which lights when the SRIW is activated; however, the NPRM (80 FR 11960, March 5, 2015) did not mention the warning light as part of the Model A320 series airplane SRIW. The NTSB also stated that details associated with the modifications of the FAC and FWC are not stated in the NPRM (80 FR 11960, March 5, 2015). The NTSB stated that without details regarding the changes associated with the Model A320 series airplane SRIW it cannot fully assess the FAA response for the Model A320 series airplanes to NTSB safety recommendations A-04-56 (http://www.ntsb.gov/safety/safety-recs/recletters/A04_56_62.pdf) and A-04-57 (http://www.ntsb.gov/safety/safety-recs/recletters/A04_56_62.pdf). The NTSB also wanted the FAA to clarify whether the Model A320 series airplane SRIW has more comprehensive protections compared with the Model A300 series airplane SRIW.

We agree with the NTSB that there are differences between the Airbus Model A300/A310 series airplane and Model A318/A319/A320/A321 series airplane SRIW systems, such as, the latter does not include a light on the glareshield in front of each pilot; instead it includes a red master caution warning in addition to the aural synthetic voice warning to prevent pilots from making any further reversals. In addition, the Model Airbus A318/A319/A320/A321 series airplane SRIW modification includes a rudder travel limiter unit (RTLU) modification in the FAC that minimizes the available deflections for all the possible combinations of altitude and speed. This will ensure that after one full rudder pedal reversal, the vertical tail plane (VTP) loads remain within the safe limits. After reviewing the design, analyses, and simulator demonstrations, the FAA has concluded that these warnings will prevent the flightcrew from continuing the inappropriate rudder inputs prior to exceeding the ultimate design loads that could result in failure of the vertical tail plane. We have determined that details associated with our disposition to NTSB safety recommendations A-04-56 and A-04-57 are outside the context of this AD. We will provide those details directly to the NTSB in our response to the safety recommendations. We have not changed this final rule in this regard.

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 (80 FR 11960, March 5, 2015) for correcting the unsafe condition; and

• Do not add any additional burden upon the public than was already proposed in the NPRM (80 FR 11960, March 5, 2015).

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

Airbus has issued Service Bulletin A320-22-1480, Revision 02, dated March 30, 2015. This service information describes procedures for modifying the pin programming to activate the SRIW logic.

Airbus has also issued the following service information. The service information describes procedures for replacing FWCs and FACs.

• Airbus Service Bulletin A320-22-1375, dated January 15, 2014.

• Airbus Service Bulletin A320-22-1427, Revision 05, dated November 24, 2014.

• Airbus Service Bulletin A320-22-1447, Revision 03, dated April 21, 2015.

• Airbus Service Bulletin A320-22-1454, dated February 12, 2014.

• Airbus Service Bulletin A320-22-1461, Revision 07, dated March 23, 2015.

• Airbus Service Bulletin A320-22-1502, dated November 14, 2014.

• Airbus Service Bulletin A320-31-1414, Revision 03, dated September 15, 2014.

This service information is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the ADDRESSES section of this AD.

We estimate that this AD affects 953 airplanes of U.S. registry.

We also estimate that it will take about 3 work-hours per product to comply with the basic requirements of this AD. The average labor rate is $85 per work-hour. Based on these figures, we estimate the cost of this AD on U.S. operators to be $243,015, or $255 per product.

In addition, we estimate that any necessary follow-on actions will take about 6 work-hours (3 work-hours for an FWC and 3 work-hours for an FAC), for a cost of up to $510 per product. We have received no definitive data that will enable us to provide part cost estimates for the on-condition actions specified in this AD. We have no way of determining the number of aircraft that might need these actions.

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.

We determined that 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 the 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.

You may examine the AD docket on the Internet at http://www.regulations.gov/#!docketDetail;D=FAA-2015-0251; or in person at the Docket Management Facility between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains this AD, the regulatory evaluation, any comments received, and other information. The street address for the Docket Operations office (telephone 800-647-5527) is in the ADDRESSES section.

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

On September 24, 2015, a final rule was published in the Federal Register establishing Class E airspace at the Newberry VOR/DME, Newberry, MI (80 FR 57522) Docket No. FAA-2015-1869. Subsequent to publication, the FAA found that the exclusionary language for Federal airways and Canadian airspace noted in the airspace description is not required and, therefore, is removed.

Accordingly, pursuant to the authority delegated to me, in the Federal Register of September 24, 2015, (80 FR 57522) FR Doc. 2015-23987, on page 57523, column 2, beginning on line 26, remove “, excluding that airspace within Federal airways and within Canadian airspace”.

AquaBounty Technologies, Inc., Two Clock Tower Pl., suite 395, Maynard, MA 01754 filed NADA 141-454 for an opAFP-GHc2 rDNA construct at the α-locus in the EO-1α lineage triploid, hemizygous, all-female Atlantic salmon (Salmo salar) known as AQUADVANTAGE Salmon. Significantly more of these Atlantic salmon grow to at least 100 grams within 2,700 Celsius degree-days than their comparators. The NADA is approved as of November 19, 2015, and the regulations are amended in 21 CFR part 528 to reflect the approval.

In addition, AquaBounty Technologies, Inc., is not currently listed in the animal drug regulations as a sponsor of an approved application. Accordingly, 21 CFR 510.600(c) is being amended to add entries for this firm.

In accordance with the freedom of information provisions of 21 CFR part 20 and 21 CFR 514.11(e)(2)(ii), a summary of safety and effectiveness data and information submitted to support approval of this application (FOI Summary) may be seen in the Division of Dockets Management (HFA-305), Food and Drug Administration, 5630 Fishers Lane, Rm. 1061, Rockville, MD 20852, between 9 a.m. and 4 p.m., Monday through Friday.

The Agency has carefully considered the potential environmental impact of this action and has concluded that the action will not have a significant impact on the human environment and that an environmental impact statement is not required. FDA's finding of no significant impact (FONSI) and the evidence supporting that finding, contained in an environmental assessment (EA), may be seen in the Division of Dockets Management (address in the previous paragraph) between 9 a.m. and 4 p.m., Monday through Friday.

Persons with access to the Internet may obtain the FOI Summary, EA, and FONSI at the Center for Veterinary Medicine FOIA Electronic Reading Room: http://www.fda.gov/AboutFDA/CentersOffices/OfficeofFoods/CVM/CVMFOIAElectronicReadingRoom/default.htm. Patent information may be accessed in FDA's publication, Approved Animal Drug Products Online (Green Book) at: http://www.fda.gov/AnimalVeterinary/Products/ApprovedAnimalDrugProducts/default.htm.

This rule does not meet the definition of “rule” in 5 U.S.C. 804(3)(A) because it is a rule of “particular applicability.” Therefore, it is not subject to the congressional review requirements in 5 U.S.C. 801-808.

Therefore, under the Federal Food, Drug, and Cosmetic Act and under authority delegated to the Commissioner of Food and Drugs and redelegated to the Center for Veterinary Medicine, 21 CFR parts 510 and 528 are amended as follows:

A vessel brings water into its ballast tanks to control or maintain trim, draft, stability or stress of the vessel when it is fully or partially empty of cargo. Generally, the vessel will discharge ballast water when it loads cargo, often at another port of call. Vessels discharge more than 80 million tons of ballast water annually into U.S. waters.1

Many invasive species have been introduced into U.S. waters through ballast water discharge because ballast water often contains organisms indigenous to the area where it was loaded. These organisms can become invasive species when they are discharged in a new location, often with damaging results.2

The Great Lakes provide many examples of the damage invasive species can inflict on an environment. According to the U.S. Environmental Protection Agency (EPA),3 no fewer than 25 invasive species of fish have entered the Great Lakes. Invasive filter-feeders such as zebra mussels have caused severe problems at power plants and municipal water supplies, clogging intake screens, pipes, and cooling systems. Fast-growing invasive plants have displaced native plant populations that support wildlife habitat and prevent erosion. The prevalence of these invasive plant species has also hindered commercial and recreational activities. Similar problems with invasive species have occurred in U.S. waters throughout the country.4

The Non-Indigenous Aquatic Nuisance Prevention and Control Act of 1990 (NANPCA, Pub. L. 101-646), as amended by the National Invasive Species Act of 1996 (NISA), (Pub. L. 104-332), requires the Secretary of Homeland Security (Secretary) to ensure, to the maximum extent practicable, that aquatic nuisance species are not discharged into U.S. waters from vessels (16 U.S.C. 4701 et seq.). These statutes also direct the Secretary to issue regulations and collect records regarding vessel ballasting practices as a means for determining vessel compliance with the ballast water management (BWM) program (16 U.S.C. 4711(c) and (f)).

The Secretary has delegated the regulatory functions and authorities in 16 U.S.C. 4711 to the Commandant of the Coast Guard (Department of Homeland Security Delegation No. 0170.1 (II.) 57). Coast Guard regulations regarding BWM are located in 33 CFR part 151, subparts C and D. With limited exceptions, these regulations apply to all vessels, U.S. and foreign, equipped with ballast tanks, that operate in U.S. waters. (see 33 CFR 151.2005, 151.2010, 151.2015, and 151.2025).

This final rule revises the regulatory provisions that deal with BWM reporting and recordkeeping requirements. A full discussion of the statutory and regulatory history of the Coast Guard's broader actions to implement both NANPCA and NISA may be found in the preamble to the final rule entitled “Standards for Living Organisms in Ships' Ballast Water Discharged in U.S. Waters,” published on March 23, 2012 (77 FR 17254).

This regulatory action implements provisions of NANPCA and NISA by requiring the collection of records on vessel BWM practices. The Coast Guard will now require vessels with ballast tanks operating exclusively on voyages between ports or places within a single Captain of the Port (COTP) Zone to submit an annual report of their BWM practices. This rule also allows most vessels to submit ballast water reports after arrival at a port or place of destination, instead of requiring submission of such reports prior to arrival. Additionally, this rule simplifies and streamlines the ballast water report form. This rule will reduce reporting redundancies affecting the regulated population, while still providing the Coast Guard with the information necessary to analyze and understand BWM practices. By doing so, this rule is intended to improve the Coast Guard's knowledge about such practices, which will enable us to reduce the discharge of aquatic nuisance species into U.S. waters from vessels and to reduce future damage caused by such discharges.

Efficient and effective BWM data collection is essential to the Coast Guard's ability to evaluate the availability of BWM technologies for the range of vessels operating in waters of the U.S. These important data directly inform the Coast Guard's decision making efforts to ensure, to the maximum extent practicable, that aquatic nuisance species are not discharged into waters of the U.S.

On June 5, 2013, the Coast Guard published a notice of proposed rulemaking (NPRM) entitled “Ballast Water Management Reporting and Recordkeeping” in the Federal Register (78 FR 33774). No public meeting was requested for this rulemaking and none was held. A summary of the proposals in the NPRM is provided below.

The Coast Guard proposed a three-year requirement applicable to vessels equipped with ballast tanks and operating exclusively on voyages between ports and places within a single COTP Zone to submit an annual summary report of their BWM practices. Historically, the Coast Guard has not collected extensive information about the BWM practices of this segment of the vessel population because it seemed unlikely that vessels operating within a single COTP Zone would introduce invasive species from place to place within the COTP Zone. Public comments received in response to the most recent Coast Guard rulemaking on ballast water 5 correctly indicated that COTP Zones are administrative in nature, and are not established based on any ecological or biological bases. Therefore, COTP Zones may not necessarily be appropriate boundaries for assessing invasive species. The Coast Guard proposed this new three-year annual reporting requirement to improve the breadth and quality of BWM data so it can make the most informed programmatic and regulatory decisions. Additionally, collecting this information advances the Coast Guard's efforts to meet the statutory requirement to maintain a clearinghouse of national ballast water data (16 U.S.C. 4712(f)).

The Coast Guard also proposed to simplify ballast water reporting for all vessels by revising the report form and encouraging electronic report submission. We proposed to streamline the reporting process and to revise the report to include only data that are essential to understanding and analyzing BWM practices.

Finally, the Coast Guard proposed to allow vessels bound for a port or destination outside of the Great Lakes or the Hudson River north of the George Washington Bridge to submit ballast water reports either no later than six hours after arrival, or prior to departure, whichever is earlier. Prior to this rulemaking, the regulations required certain vessels to submit ballast water reports before arriving at the port or destination. As a practical matter, vessels often discovered information after arrival that necessitated amending the reports. Accordingly, the Coast Guard proposed the change in submission requirements to reduce the need for amended reports.

In response to the NPRM, the Coast Guard received 6 public comment letters containing a total of 13 separate comments. The comments are available for viewing in the public docket for this rulemaking, where indicated above under ADDRESSES.

This section contains a description of each comment, followed by the Coast Guard's response. Since several of the letters raised similar issues, this section is organized by comment topic. Except for the changes identified in this section, the Coast Guard adopts the regulations as proposed in the NPRM without change.

One commenter supported the proposal to require vessels operating within a single COTP zone to submit annual reports for three years. The commenter stated that annual reporting would provide data that is useful to the Coast Guard for making regulatory decisions affecting these vessels. The Coast Guard agrees.

One commenter opposed the proposal to require vessels operating within a single COTP zone to submit annual reports, arguing that the burden of the reporting requirement is not justified due to the low risk of introduction of aquatic invasive species within a single COTP zone. The Coast Guard disagrees. An annual report, limited to three years, presents a minimal burden, but will provide the essential data for the Coast Guard to determine whether vessels that operate solely in a single COTP zone should be subject to the same or similar BWM regulations as those applicable to vessels operating in multiple COTP zones.

The commenter also suggested the Coast Guard could obtain all necessary ballast water operation information from advisory committees and trade associations instead of introducing new reporting requirements. The Coast Guard disagrees. Data from such sources would be limited because not all vessel owners and operators are members of trade associations or represented in advisory committee studies. Furthermore, reports to such trade associations and advisory committees would be voluntary instead of legally required, which would limit the amount of data. For these reasons, a streamlined, annual report is the more effective approach for collecting accurate data.

Two commenters supported the Coast Guard's proposal to streamline and simplify the ballast water reporting form. In this final rule, the Coast Guard is taking an additional step to simplify the regulations in §§ 151.2060 (Reporting requirements) and 151.2070 (Recordkeeping requirements). The Coast Guard intends to align the information required for reporting and recordkeeping purposes as much as possible because the information required to satisfy both requirements is almost identical. The NPRM, however, listed the information required for reporting purposes under § 151.2060, and separately listed similar information required for recordkeeping purposes in § 151.2070. Upon further review of the NPRM, the Coast Guard wishes to avoid any confusion or misunderstanding regarding the lists of information required for reporting and recordkeeping. Specifically, the Coast Guard wishes to avoid a misunderstanding that there is one set of information required under § 151.2060 for reporting purposes, and a separate set of information required under § 151.2070 for recordkeeping purposes. Accordingly, for regulatory clarity, this final rule now lists the information required for reporting purposes in § 151.2060. Instead of repeating that list of information for recordkeeping, § 151.2070(a) simply states that there is a requirement to maintain records of all the information required to be reported under § 151.2060. Also in § 151.2070, there is an additional recordkeeping requirement regarding sediment discharge. Sediment discharge is the one data point which is subject to the recordkeeping requirement, but is not subject to the reporting requirement.

Another commenter requested an additional change to the form that would enable a reporting officer to sign the form electronically. The Coast Guard is granting this request. Ballast water reporting forms are submitted to the National Ballast Information Clearinghouse (NBIC) using any of the methods on the NBIC Web site.6 Reporters may complete the form by filling out the fields on NBIC's online click-thru web-based version of the form. At the end of the web-based form, reporters will be asked to electronically certify the accuracy of the information provided. This certification satisfies the Coast Guard's signature requirement in § 151.2070 for recordkeeping purposes.

One commenter requested an additional change to the form that would enable reporters to highlight an entire column and fill it out with one entry that stays constant (or near-constant) throughout the body of the report. The Coast Guard wishes to clarify that while we manage the content of the form, NBIC manages the functionality of the form. The Coast Guard communicated the commenter's request to NBIC for its consideration. NBIC advised against the commenter's request, noting that it implemented this option into an earlier test version of the form and found that it resulted in too many errors. Specifically, the ease of use of auto-fill columns was outweighed by the tendency of reporters to not enter data in these columns accurately. As form technology evolves, NBIC will consider adding an auto-fill function pending availability of a system that is better at identifying and eliminating errors.

One commenter requested that the Coast Guard continue to allow all vessel operators the choice of reporting ballast water capacities and discharge volumes in gallons or metric tons. The Coast Guard communicated the commenter's request to NBIC for its consideration. NBIC has agreed to change the form to include a drop-down menu that enables reporters to choose gallons or cubic meters as their preferred unit of measurement. Because the form will now allow reporters to choose which volumetric unit to use, we have removed the specific reference to cubic meters from the regulatory text in 33 CFR 151.2060.

One commenter noted that the form requires reporters to provide the vessel's International Maritime Organization (IMO) number, though many U.S.-flagged vessels are not issued IMO numbers. The commenter recommended an amendment to the form to specify another acceptable identification number for such vessels. In response, the Ballast Water Reporting form will be updated to offer an option for inputting either the IMO number or other documentation number.

Three commenters supported the Coast Guard's proposal to allow vessels to submit ballast water reports after arrival at a port or place of destination. The Coast Guard adopts the proposal without change. For purposes of clarity, we note that Coast Guard regulations in 33 CFR 151.2005 define the phrase “[p]ort or place of destination” to mean “. . . any port or place to which a vessel is bound to anchor or moor.” The Coast Guard provides further guidance on the practical application of the phrase “port or place of destination” for ballast water reporting purposes in Navigation and Vessel Inspection Circular NVIC 07-04, Change 1 (Oct. 29, 2004).7 For example, for barges equipped with ballast tanks, reports must be submitted only for stops where cargo operations are conducted. For towing vessels equipped with ballast tanks, reports must be submitted when the vessel conducts fueling operations. In both cases, reports are not required when the vessel stops for fleeting, waits for locks, or purposes other than cargo or fueling operations.

One commenter requested a change to the regulations to emphasize that vessels operating on the Great Lakes are covered under the new provision permitting report submission within six hours after arrival at a port or place of destination. While the Coast Guard agrees that the vessels in question are covered under this provision, we are not granting the commenter's request to change the regulatory text because the language in 33 CFR 151.2060 is sufficiently clear on this point, and it is unnecessary to add specific language solely for Great Lakes vessels.

One commenter suggested 2 alternatives for when the 6-hour post-arrival submission window should start in order to further reduce the need for amended reports. The commenter suggested that the 6-hour window should start when the vessel's cargo operations commence, even if this is some time after the vessel arrives at berth. Alternatively, the commenter suggested that the 6-hour window should start when the vessel arrives at berth. The Coast Guard rejects the commenter's preferred approach because it would mean different timing for different vessels, causing inconsistency in applying and enforcing the 6-hour submission window. Regarding the commenter's alternative approach, the Coast Guard expects that the 6-hour submission window starting upon arrival at the “port or place of destination” as discussed above will give the vessel crew ample time to submit an accurate ballast water report, without the need for an amended report in most instances. The Coast Guard will, however, continue to enable vessels to submit an amended report when necessary.

One commenter requested that the Coast Guard provide a definition of the term “trip” for reporting purposes on operations exclusively within a single COTP Zone. We agree that the term “trip” is ambiguous. To clarify, the Coast Guard is not seeking reported information on each and every vessel movement. Instead, we are seeking reported information on the number of ballast water discharges, if any. The Coast Guard has modified the regulatory text by removing the term “trip” to more clearly reflect the Coast Guard's intention.

Two commenters questioned the utility of BWM data to the Coast Guard, and requested that we consider eliminating BWM reporting and recordkeeping requirements altogether. For the reasons discussed below, the Coast Guard cannot grant this request.

The Coast Guard requires vessels to report and to maintain records of BWM practices and activities pursuant to a statutory mandate (16 U.S.C. 4711(f)). More specifically, this information enables us to assess the rate of effective compliance with established BWM requirements and guidelines. The information provides important data on volumes of ballast water discharged by different types of vessels, patterns of ballast water transport (i.e., locations where ballast water is loaded and discharged), patterns of BWM by different types of vessels, and safety and practicability issues that affect the ability of different types of vessels to implement specific BWM practices.

Additionally, the Coast Guard uses the reported information to track patterns of BWM and delivery in the U.S. over time. These data provide information on the relative amounts of ballast water that different types of vessels must manage, as well as the circumstances (e.g., voyage lengths and routes) that necessitate BWM. These data are also essential in evaluating the availability of BWM technologies for the range of vessels operating in waters of the U.S. These important data directly inform the Coast Guard's decision making efforts to ensure, to the maximum extent practicable, that aquatic nuisance species are not discharged into waters of the U.S.

One commenter questioned whether this rulemaking applies to vessels that operate outside of U.S. waters (i.e., beyond 12 nautical miles of shore), but still within the Exclusive Economic Zone (EEZ), which generally extends 200 nautical miles from the territorial sea baseline.8 The Coast Guard confirms that this rulemaking does not apply to vessels operating exclusively outside of U.S. waters. In accordance with the applicability provision in 33 CFR 151.2010, this rulemaking “applies to all non-recreational vessels, U.S. and foreign, that are equipped with ballast tanks and operate in the waters of the United States, except as expressly provided in § 151.2015 or § 151.2020 of [33 CFR part 151 subpart D].”

Two commenters requested exemptions from the ballast water reporting requirements for certain vessels, including those that do not discharge ballast water from their tanks and those that use potable water for ballast. The Coast Guard is not granting these requests for blanket exemptions. The controlling statutory provisions in 46 U.S.C. 4711(c) and (f) require the Coast Guard to apply these regulations to “. . . all vessels equipped with ballast water tanks that operate in the waters of the United States.” It is the presence of a ballast water tank that triggers the applicable reporting requirement, not the discharge of ballast water. When a vessel is equipped with a ballast water tank, the non-discharge of ballast water or the use of potable water for ballast is a BWM practice, and the reporting requirement provides useful information regarding the effectiveness of these measures in preventing the introduction or spread of invasive species. The purpose of the reported information is to assist the Coast Guard in evaluating BWM practices in general, regardless of whether a vessel discharges ballast water. However, we remind owners and operators that 33 CFR 151.2065 provides relief under certain circumstances (i.e., where compliance with 33 CFR 151.2060 is economically or physically impractical) to submit a request for the Coast Guard to approve an alternative equivalent reporting method.

We are revising the text in 33 CFR 151.2015 in several places to refer to a “single” COTP zone instead of “one” COTP zone for clarity and consistency with the rest of that section. Additionally, we are revising the text in 33 CFR 151.2060(b)(1)(ii) to reflect the accurate name of the “St. Lawrence Seaway Ballast Water Reporting Form.” These are non-substantive technical changes.

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

Executive Orders 12866 (“Regulatory Planning and Review”) and 13563 (“Improving Regulation and Regulatory Review”) direct agencies to assess the costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility.

This final rule has not been designated a “significant regulatory action” under section 3(f) of Executive Order 12866, “Regulatory Planning and Review,” as supplemented by Executive Order 13563, “Improving Regulation and Regulatory Review,” and does not require an assessment of potential costs and benefits under section 6(a)(3) of that Order. Accordingly, the final rule has not been reviewed by the Office of Management and Budget (OMB).

We received no public comments that affect the Regulatory Assessment (RA); nor have we identified any new information or data that would require us to reassess the RA in the NPRM. We, therefore, adopt the NPRM's Regulatory Assessment as the final assessment to this final rule. A final Regulatory Assessment is provided as follows:

Table 1 presents a summary of the economic impact of this final rule. A detailed description of the estimates is presented in the next sections.

This final rule would modify and amend the following recordkeeping requirements and procedures:

In this final rule, the Coast Guard requires owners or operators of vessels with ballast tanks operating exclusively on voyages between ports or places within a single COTP Zone to submit an annual summary report of their BWM practices for a period of 3 years.

Based on data from the Coast Guard Marine Information for Safety and Law Enforcement (MISLE) and the Ship Arrival Notification System (SANS), we estimate that the final rule will have an annual affect on 1,280 U.S.-flagged vessels that operate exclusively between ports or places within a single COTP Zone. Table 2 presents the vessel types affected by this requirement. These vessels are currently exempt from the ballast water reporting requirements under 33 CFR 151.2070. Owners or operators of these vessels will be required to submit an annual summary report of their BWM practices to the Coast Guard for a period of 3 years.

For the purposes of the cost analysis, we assume that all vessels discharge ballast water. We estimate the total annual burden hours required to complete the report will be approximately 40 minutes per vessel per year. We anticipate vessel owners or operators will need 15 minutes to complete and submit their annual ballasting report. Most of the information required is well known by the vessel owner or operator and does not require additional document consultation. The information that does not require additional document consultation includes: Vessel name, identification number, type, operator, tonnage, call sign, COTP Zone of operation, number of ballast water tanks, total ballast water capacity, and primary port of ballast water loading and discharge.

The remaining 25 minutes accounts for the total time allocated (over the entire year) for vessel operators to assemble and review information to determine the number of times ballast water is discharged and the volume of discharge released during such vessel operations. We also recognize that vessels that do not discharge ballast water will only be burdened with the 15 minutes to fill out and submit the annual form.

We assume that the vessel owner or operator, with an estimated wage rate of $69/hr 10 , will be in charge of this reporting. The annual cost per vessel is $46.23 (.67 hrs × $69/hr) and the total cost per vessel for the 3-year period is $139. The estimated annual cost of the new reporting requirement for the 1,280 vessels, operating exclusively between ports or places within a single COTP Zone, is, $59,174 (1,280 vessels × .67 hrs × $69 hr) (undiscounted). The total cost for a 3-year reporting period is $177,522 (undiscounted) or $155,291 (at seven percent discount rate). Table 3 presents the reporting costs for vessels operating exclusively between ports or places within a single COTP Zone.

This final rule will collect information on ballast water operations from vessels operating exclusively between ports or places within a single COTP Zone, a segment of the industry for which the Coast Guard has limited information. Therefore, the Coast Guard seeks to improve the breadth and quality of its BWM data so it can make the most informed programmatic and regulatory decisions.

The Coast Guard considered several alternatives for collecting the needed information on the ballast practices for vessels operating exclusively between ports or places within a single COTP Zone. One alternative would require these vessels to complete a full ballast water reporting form (33 CFR 151.2060) upon each entry into port, similar to existing requirements for other vessels operating outside a single COTP Zone. The Coast Guard instead chose the alternative that requires only an annual summary report of ballast activities with a limited number of required data elements. The Coast Guard will also collect this data for only 3 years. The Coast Guard believes that the annual summary report for 3 years provides enough information to characterize BWM practices for vessels operating exclusively between ports or places within a single COTP Zone, while minimizing the reporting burden to these entities.

The Coast Guard is updating the ballast water reporting form to make it more concise and include only essential data on BWM practices. Current recordkeeping requirements in 33 CFR 151.2070 are amended to include only data fields essential for understanding and analyzing BWM practices of vessels operating in waters of the U.S.

Vessel owners or operators who currently submit ballast water reports to comply with 33 CFR 151.2060 requirements will not incur additional burden due to the reporting updates. Updates to the report form will make questions more clear and concise. The most time consuming section of the report (section 5, “Ballast Water History”) will be restructured, but the content will be maintained. We do not expect that changes to the reporting form will affect the amount of burden time necessary to fill-out the form. Currently, vessels equipped with ballast water tanks bound for ports or places within the U.S. or those entering U.S. waters are required to submit a ballast water report. According to the Coast Guard's estimate in OMB collection of information Control Number 1625-0069, it takes approximately 40 minutes to complete and submit the report. The CFR at 33 CFR 151.2060 and 151.2070 presents detailed information on reporting and recordkeeping requirements.

In addition, updating the current reporting form will improve the utility of the data provided by the vessel population to the Coast Guard.

Prior to this final rule, 33 CFR 151.2060 required vessels to predict their ballasting operations and submit reports on BWM 24 hours before arrival at port. Often, vessel owners and operators would revise their reports with the actual ballasting information and resubmit them to NBIC. NBIC estimates that approximately 40 percent of the amended reports it receives are due to the timing of the report submission. Allowing those vessels travelling from outside of the EEZ that are not bound for the Great Lakes or the Hudson River north of the George Washington Bridge to submit ballast water reports after arrival to the port or place of destination greatly reduces the need for amended reports. We estimate that an average of 10,717 reports 12 are amended and resubmitted every year due to the timing of submission. We estimate that it would take the vessel owner or operator approximately 15 minutes to amend and resend the reports. Therefore, we expect that this amendment will result in an annual reduction of burden by approximately 2,679 hours (10,717 reports × 0.25 hours 13 ), representing a cost savings of $184,868 (2,679 hours × $69/hr 14 ) per year to the industry. The total cost savings (Table 4) that results from allowing report submittal after arrival at a port for a 10-year period is $1,298,437 (at 7 percent discount rate).

The Coast Guard expects reporting efficiency and data handling will improve by changing the format of the electronic report that can be found in Information Collection Request (ICR), OMB Control number 1625-0069. The Coast Guard will standardize the data formats and add pull down menus. Since the pull down menu will make the reporting form simpler and will reduce response variability, we do not anticipate any significant change in the reporting burden. These efficiencies will not result in cost savings. Therefore, we do not expect additional costs or cost savings to the industry. According to NBIC data from the past 6 years, approximately 99 percent of reports have been submitted electronically. Within the last 2 years, 100 percent of the reports have been submitted electronically. Standardized data entry will improve data quality and, as a result, data analyses will be easier and less time consuming.

This final rule will impact the industry for a limited time only (3 years). During this time, we estimate a total annual non-discounted cost savings of $125,694 and a total 10-year non-discounted cost savings of $1,671,160. We also estimate an annualized cost savings of $162,758, with a discounted ten-year saving of $1,443,145 both respectively discounted at 7 percent for a 10-year period of analysis. These estimates are developed and shown in Table 5.

Under the Regulatory Flexibility Act (RFA) (5 U.S.C. 601-612), we have considered whether this final rule would have a significant economic impact on a substantial number of small entities. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000.

As described in the “Regulatory Analyses” section, we expect costs per vessel (an annual cost of $46.23 for a 3-year period) to owners or operators of vessels operating exclusively between ports or places within a single COTP Zone. Based on available data, we estimate that about 74 percent of entities affected by this final rule are small under the RFA and the Small Business Administration's size standards. The economic impact of the 3-year reporting requirement is less than 1 percent of revenue for 100 percent of the small entities. We determine that each entity, on average, manages a total of 3 vessels with an estimated annual cost of $139 (3 * $46.23) (non-discounted). We have estimated that for this rule to have a revenue impact of greater than 1 percent, total annual revenue for small entities must be less than $13,900. Therefore, we anticipate that this final rule will not have a significant economic impact on small entities. Through this final rule, the Coast Guard will obtain information on ballast water operations from a segment of the industry for which there is limited information, and improve the utility of the data provided to Coast Guard.

Owners and operators of applicable vessels already reporting BWM practices under 33 CFR 151.2060 would incur a cost savings as a result of the elimination of post-arrival amendments due to time of the reporting.

Therefore, the Coast Guard certifies that under 5 U.S.C. 605(b), this final rule will not have a significant economic impact on a substantial number of small entities.

Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Pub. L. 104-121), we want to assist small entities in understanding this final rule so that they can better evaluate its effects on them and participate in the rulemaking. If the final rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please consult Ms. Regina Bergner, Environmental Standards Division, U.S. Coast Guard (CG-OES-3); telephone 202-372-1431, email, [email protected]. The Coast Guard will not retaliate against small entities that question or complain about this rule or any policy or action of the Coast Guard.

Small businesses may send comments on the actions of Federal employees who enforce, or otherwise determine compliance with, Federal regulations to the Small Business and Agriculture Regulatory Enforcement Ombudsman and the Regional Small Business Regulatory Fairness Boards. The Ombudsman evaluates these actions annually and rates each agency's responsiveness to small business. If you wish to comment on actions by employees of the Coast Guard, call 1-888-REG-FAIR (1-888-734-3247).

This final rule modifies an existing collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520). As defined in 5 CFR 1320.3(c), “collection of information” comprises reporting, recordkeeping, monitoring, posting, labeling, and other, similar actions. The title and description of the information collection, a description of those who must collect the information, and an estimate of the total annual burden follow. The burden-hour estimates cover the time for reviewing instructions, searching existing sources of data, gathering and maintaining the data needed, and completing and reviewing the collection.

Title: Ballast Water Management Reporting and Recordkeeping.

OMB Control Number: 1625-0069.

Summary of the Collection of Information: This final rule modifies the existing BWM recordkeeping requirements in 33 CFR 151.2070 and amends the ballast water report. In this final rule, the Coast Guard requires vessels with ballast tanks that operate exclusively on voyages between ports or places within a single COTP Zone to submit an annual summary report of their BWM practices for 3 years. The Coast Guard is also updating the ballast water report to include only data that are essential to understanding and analyzing BWM practices. These updates will not result in changes to current industry burden. The final rule also allows most vessels to submit ballast water reports after arrival at the port or place of destination.

Need for Information: It is essential for the Coast Guard to improve the breadth and quality of its BWM data so it can make the most informed programmatic and regulatory decisions on how to prevent the introduction of non-indigenous aquatic species in U.S. waters. Limited information is available for vessels operating exclusively between ports or places within a single COTP Zone, since most of these vessels are exempt from the reporting requirements of 33 CFR 151.2060.

Use of Information: BWM data from a segment of the industry for which the Coast Guard has limited information will improve the utility of the data provided by the currently-regulated vessel population.

Description of the Respondents: The respondents are:

(a) Owners and operators of vessels with ballast water tanks operating exclusively on voyages between ports or places within a single COTP Zone.

(b) Owners and operators of vessels currently reporting BWM activities under 33 CFR 151.2060.

Number of Respondents: The current number of respondents is 8,383. The requirements of this final rule will add 1,280 respondents from vessels with ballast water tanks operating exclusively on voyages between ports or places within a single COTP Zone. Therefore, the total number of respondents would increase by 1,280 to 9,663 (8,383 current respondents + 1,280 new respondents).

Frequency of Response: Current respondents under 33 CFR 151.2060 will continue to submit their reports upon arrival to U.S. ports. New respondents (owners and operators of vessels operating exclusively on voyages between ports or places within a single COTP Zone) will report once a year for a period of 3 years. After the 3 year period, the Coast Guard will have a base understanding of ballast water practices for these vessels, and reporting requirements will no longer be necessary.

Burden of Response: We estimate that the response would take approximately 40 minutes per report for vessels with ballast water tanks operating exclusively on voyages between ports or places within a single COTP Zone.

Estimate of Total Annual Burden: The annual burden is estimated as follows:

(a) Annual burden for new reporting requirement for vessels operating within a single COTP Zone: This rule would create a new burden of 858 hours (1,280 vessels × .67 hours) 15 for the private sector.

(b) Annual burden for current reporting requirements:

This final rule will result in a total annual burden increase of 858 hours due to the new requirement for vessels operating exclusively on voyages between ports or places within a single COTP Zone. We estimate the total annual cost burden to be $59,174 (non-discounted).

As required by the Paperwork Reduction Act of 1995 (44 U.S.C. 3507(d)), we will submit a copy of this final rule to the Office of Management and Budget (OMB) for its review of the collection of information.

A rule has implications for federalism under Executive Order 13132, Federalism, if it has a substantial direct effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government. We have analyzed this rule under that Order and have determined that it is consistent with the fundamental federalism principles and preemption requirements described in Executive Order 13132. Our analysis is explained below.

This rule revises the Coast Guard's BWM reporting and recordkeeping requirements promulgated under the authority of NANPCA, as amended by NISA. NANPCA, as amended by NISA, contains a “savings provision” that saves to States their authority to “adopt or enforce control measures for aquatic nuisance species, [and nothing in the Act would] diminish or affect the jurisdiction of any State over species of fish and wildlife” (16 U.S.C. 4725). This type of BWM reporting and recordkeeping is a “control measure” saved to States under the savings provision and would not be preempted unless State law makes compliance with this rule's requirements impossible or frustrates the purpose of Congress. No such State law has been identified. Additionally, the Coast Guard has long interpreted this savings provision to be a congressional mandate for a Federal-State cooperative regime in which federal preemption under NANPCA, as amended by NISA, would be unlikely.

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

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

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

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

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

We have analyzed this rule under Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use.” We have determined that it is not a “significant energy action” under that order because it is not a “significant regulatory action” under Executive Order 12866 and is not likely to have a significant adverse effect on the supply, distribution, or use of energy. The Administrator of the Office of Information and Regulatory Affairs has not designated it as a significant energy action. Therefore, it does not require a Statement of Energy Effects under Executive Order 13211.

The National Technology Transfer and Advancement Act (15 U.S.C. 272 note) directs agencies to use voluntary consensus standards in their regulatory activities unless the agency provides Congress, through the Office of Management and Budget, with an explanation of why using these standards would be inconsistent with applicable law or otherwise impractical. Voluntary consensus standards are technical standards (e.g., specifications of materials, performance, design, or operation; test methods; sampling procedures; and related management systems practices) that are developed or adopted by voluntary consensus standards bodies.

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

We have analyzed this rule under Department of Homeland Security Management Directive 023-01 and Commandant Instruction M16475.lD, which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (NEPA) (42 U.S.C. 4321-4370f), and have concluded that this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. A final environmental analysis checklist supporting this determination is available in the docket where indicated under the “Addresses” section of this preamble. This rule involves regulations that are editorial and procedural, and falls under section 2.B.2, figure 2-1, paragraph (34)(a) of the Instruction.

For the reasons discussed in the preamble, the Coast Guard amends 33 CFR part 151 as follows:

The Coast Guard is issuing this temporary rule without prior notice and opportunity to comment pursuant to authority under section 4(a) of the Administrative Procedure Act (APA) (5 U.S.C. 553(b)). This provision authorizes an agency to issue a rule without prior notice and opportunity to comment when the agency for good cause finds that those procedures are “impracticable, unnecessary, or contrary to the public interest.” Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good cause exists for not publishing a notice of proposed rulemaking (NPRM) with respect to this rule because it is impractical given that the final details for the dredging operation were not received until November 12, 2015. Vessels attempting to enter the waters of either Pea Patch Island Anchorage No. 5 or the upper portion of Reedy Point South Anchorage No. 3 during pipe-laying or dredging operations may be at risk. Delaying this rule to wait for a notice and comment period to run would be contrary to the public interest as it would inhibit the Coast Guard's ability to protect the public from the hazards associated with pipe-laying and dredging operations. We are issuing this rule, and, under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause exists for making it effective less than 30 days after publication in the Federal Register because allowing this dredging and pipe laying operation to go forward without a safety zone in place would expose mariners and the public to unnecessary dangers.

The Coast Guard is issuing this rule under authority in 33 U.S.C. 1231; 33 CFR 1.05-1 and 160.5; and Department of Homeland Security Delegation No. 0170.1. The Captain of the Port, Delaware Bay, has determined that potential hazards associated with dredging and pipe laying operations starting November 20, 2015, will be a safety concern for anyone attempting to transit in the Delaware River, along New Castle Range, in the vicinity of Pea Patch Island Anchorage No. 5, the upper portion of Reedy Point South Anchorage No. 3, and near the entrance to the C & D Canal. This rule is needed to protect personnel, vessels, and the marine environment in the navigable waters within the safety zone while dredging is being conducted.

The Coast Guard Captain of the Port is temporarily establishing a safety zone on the waters of Pea Patch Island Anchorage No. 5 and the upper portion of Reedy Point South Anchorage No. 3 from November 20, 2015 to December 31, 2015, unless cancelled earlier by the Captain of the Port. The safety zone will include all waters within the boundaries of Pea Patch Island Anchorage No. 5 and all waters within a portion of Reedy Point South Anchorage No. 3 north of a line drawn between positions 39°33′7.5″ N., 75°33′2.0″ W. and 39°33′8.8″ N., 75°32′31.8″ W., as charted on NOAA chart 12311. The waters of the anchorages are described in 33 CFR 110.157. Entry into, transiting, or anchoring within the safety zone is prohibited unless vessels obtain permission from the Captain of the Port (COTP) or make satisfactory passing arrangements with the dredge ESSEX per this rule and the Rules of the Road (33 CFR chapter I, subchapter E).

The Captain of the Port will terminate the safety zone once all submerged pipeline has been recovered and dredging operations are complete. Notice of the implementation and the termination of the safety zone will be made per 33 CFR 165.7.

We developed this rule after considering numerous statutes and executive orders (E.O.s) related to rulemaking. Below we summarize our analyses based on a number of these statutes and E.O.s, and we discuss First Amendment rights of protestors.

E.O.s 12866 and 13563 direct agencies to assess the costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits. E.O. 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This rule has not been designated a “significant regulatory action,” under E.O. 12866. Accordingly, it has not been reviewed by the Office of Management and Budget.

This regulatory action determination is based on the size, location, and duration of the safety zone. Although this regulation will restrict access to the regulated area, the effect of this rule will not be significant because Pea Patch Island Anchorage No. 5 and Reedy Point Anchorage No. 3 are not frequently used anchorages for vessels in the Delaware River, especially during the period of the closure, and there are a number of alternate anchorages available for vessels to anchor. Furthermore, vessels may be permitted to transit through the safety zone with the permission of the Captain of the Port or upon making satisfactory passing arrangements with the dredge. Extensive notification of the safety zone to the maritime public will be made via maritime advisories allowing mariners to alter their plans accordingly.

The Regulatory Flexibility Act of 1980, 5 U.S.C. 601-612, as amended, requires Federal agencies to consider the potential impact of regulations on small entities during rulemaking. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000. The Coast Guard certifies under 5 U.S.C. 605(b) that this rule will not have a significant economic impact on a substantial number of small entities.

While some owners or operators of vessels intending to transit the safety zone may be small entities, for the reasons stated in section V.A above, this rule will not have a significant economic impact on any vessel owner or operator.

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

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

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

A rule has implications for federalism under E.O. 13132, Federalism, if it has a substantial direct effect on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government. We have analyzed this rule under that Order and have determined that it is consistent with the fundamental federalism principles and preemption requirements described in E.O. 13132.

Also, this rule does not have tribal implications under E.O. 13175, Consultation and Coordination with Indian Tribal Governments, because it does not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes. If you believe this rule has implications for federalism or Indian tribes, please contact the person listed in the FOR FURTHER INFORMATION CONTACT section above.

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

We have analyzed this rule under Department of Homeland Security Management Directive 023-01 and Commandant Instruction M16475.lD, which guide the Coast Guard in complying with the National Environmental Policy Act of 1969(42 U.S.C. 4321-4370f), and have determined that this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. This rule involves a safety zone in force from November 20, 2015 to December 31, 2015, that prohibits entry of vessels in Pea Patch Island Anchorage No. 5 and the upper portion of Reed Point Anchorage No. 3. It is categorically excluded from further review under paragraph 34(g) of Figure 2-1 of the Commandant Instruction. An environmental analysis checklist supporting this determination and a Categorical Exclusion Determination are available in the docket where indicated under ADDRESSES. We seek any comments or information that may lead to the discovery of a significant environmental impact from this rule.

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

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

Section 118 of the Copyright Act, title 17 of the United States Code, creates a statutory license for the use of published nondramatic musical works and published pictorial, graphic, and sculptural works in connection with noncommercial broadcasting.

On November 29, 2012, the Copyright Royalty Judges (Judges) adopted final regulations governing the rates and terms of copyright royalty payments under section 118 of the Copyright Act for the license period 2013-2017. See 77 FR 71104. Pursuant to these regulations, on or before December 1 of each year, the Judges shall publish in the Federal Register a notice of the change in the cost of living for the rate codified at § 381.5(c)(3) relating to compositions in the repertory of SESAC. The adjustment, fixed to the nearest dollar, shall be the greater of “the change in the cost of living as determined by the Consumer Price Index (all consumers, all items) [CPI-U] * * * during the period from the most recent index published prior to the previous notice to the most recent index published prior to December 1, of that year,” or 2%. 37 CFR 381.10.

The change in the cost of living as determined by the CPI-U during the period from the most recent index published before December 1, 2014, to the most recent index published before December 1, 2015, is .2%.1 In accordance with 37 CFR 381.10(b), the Judges announce that COLA for calendar year 2016 shall be 2%. Application of the 2% COLA to the current rate for the performance of published nondramatic musical compositions in the repertory of SESAC—$146 per station—results in an adjusted rate of $149 per station.

In consideration of the foregoing, the Judges amend part 381 of title 37 of the Code of Federal Regulations as follows:

The satellite carrier compulsory license establishes a statutory copyright licensing scheme for the retransmission of distant television programming by satellite carriers. 17 U.S.C. 119. Congress created the license in 1988 and has reauthorized the license for additional five-year periods, most recently with the passage of the STELA Reauthorization Act of 2014, Public Law 113-200.

On August 31, 2010, the Copyright Royalty Judges (Judges) adopted rates for the section 119 compulsory license for the 2010-2014 term. See 75 FR 53198. The rates were proposed by Copyright Owners and Satellite Carriers 1 and were unopposed. Id. Section 119(c)(2) of the Copyright Act provides that, effective January 1 of each year, the Judges shall adjust the royalty fee payable under Section 119(b)(1)(B) “to reflect any changes occurring in the cost of living as determined by the most recent Consumer Price Index (for all consumers and for all items) [CPI-U] published by the Secretary of Labor before December 1 of the preceding year.” Section 119 also requires that “[n]otification of the adjusted fees shall be published in the Federal Register at least 25 days before January 1.” 17 U.S.C. 119(c)(2).

The change in the cost of living as determined by the CPI-U during the period from the most recent index published before December 1, 2014, to the most recent index published before December 1, 2015, is .2%.2 Application of the .2% COLA to the current rate for the secondary transmission of broadcast stations by satellite carriers for private home viewing—27 cents per subscriber per month—results in an unchanged rate of 27 cents per subscriber per month (rounded to the nearest cent). See 37 CFR 386.2(b)(1). Application of the .2% COLA to the current rate for viewing in commercial establishments—56 cents per subscriber per month—results in an unchanged rate of 56 cents per subscriber per month (rounded to the nearest cent). See 37 CFR 386.2(b)(2).

In consideration of the foregoing, the Judges amend part 386 of title 37 of the Code of Federal Regulations as follows:

FRA is issuing this interim interpretation to clarify provisions in its locomotive engineer and conductor qualification and certification regulations related to further evaluation of persons who do not meet the vision threshold criteria in Title 49 Code of Federal Regulations (CFR) 240.121(c) and 242.117(h), and to provide best-practices guidance for designing valid, reliable, and comparable vision field tests, in response to: (1) The fatal railroad accident that occurred near Goodwell, OK, on June 24, 2012; (2) inquiries FRA has received requesting clarification of the applicable regulatory provisions; and (3) numerous requests for FRA review, under the locomotive engineer and conductor certification regulations, when individuals have been denied recertification by a railroad based on a color vision or monocular vision deficiency.

The fatal accident that occurred near Goodwell, in which two Union Pacific Railroad (UP) trains collided head-on, exemplifies how important it is to railroad safety that each railroad establish valid, reliable, and comparable procedures to evaluate persons who do not meet the vision thresholds in 49 CFR 240.121(c) or 242.117(h), and to strictly adhere to those procedures. The locomotive engineer and conductor of the eastbound train and the engineer of the westbound train were killed. Three locomotives and 24 cars of the eastbound train and 2 locomotives and 8 cars of the westbound train derailed. Several fuel tanks from the derailed locomotives were ruptured, releasing diesel fuel that ignited and burned. Damage was estimated at $14.8 million. The National Transportation Safety Board (NTSB) determined that one of several probable causes of the accident was the eastbound engineer's inability to visually detect and recognize the approach and stop signal aspects of wayside railroad signals due to color vision deficiency and distant visual acuity impairment the engineer had acquired as a result of a number of chronic, progressive eye conditions and visual disturbances.1

During its investigation of the Goodwell accident, the NTSB found that: (1) The eastbound engineer last underwent vision testing required for recertification in 2009; (2) during that testing, the eastbound engineer failed an initial color vision test (i.e., the Ishihara Color Vision Test 2 ) that UP selected from the list of color vision test protocols in 49 CFR part 240, Appendix F, and did not meet the distant visual acuity threshold (corrected) in 49 CFR 240.121(c); (3) UP relied on a vision field test of unknown validity, reliability, and comparability 3 in further evaluating the engineer and did not adhere to UP's field test protocol; (4) UP relied on a telephonic report of distant visual acuity testing from the engineer's optometrist in recertifying the engineer, and did not adhere to UP's own policy which required UP to obtain written documentation from the engineer's optometrist to confirm the telephonic report; and (5) UP failed to reevaluate the engineer's vision within one year of his 2009 recertification despite the UP medical examiner's written determination that it was necessary to reevaluate the engineer's vision within one year, rather than triennially, due to the engineer's chronic, progressive eye conditions. The NTSB concluded that had the engineer been reevaluated by UP the following year or when he self-reported his test results, the collision might have been avoided.

As indicated in the NTSB's report on the Goodwell accident, there are numerous eye conditions, including color vision deficiency and monocular vision, which can affect a person's ability to safely perform as a locomotive engineer or conductor. The American Optometric Association defines “color vision deficiency” as the inability to distinguish certain shades of color, or in more severe cases, see colors at all. The term “color blindness” is also used to describe this visual condition, but very few people are completely color-blind. People who have complete color-blindness, a condition called achromatopsia, can only see things as black and white or in shades of gray. The severity of color vision deficiency can range from mild to severe. “Red-green” is the most common deficiency. Another form of color deficiency is “blue-yellow.” The latter is a rare and more severe form of color vision deficiency since persons with blue-yellow deficiency frequently have red-green deficiency too. Color vision deficiency can be inherited. About 8 percent of Caucasian males are born with some degree of color deficiency. Women are typically asymptomatic if they are carriers of the color deficient gene (i.e., women are carriers of the gene without suffering with color vision deficiency), though approximately 0.5 percent of women have color vision deficiency. People can also acquire a color vision deficiency as a result of certain types of medical conditions, a side-effect of certain medications, and certain eye injuries. Examples of eye conditions that can cause an acquired color-vision deficiency include, but are not limited to, diabetes, glaucoma, macular degeneration, multiple sclerosis, chronic alcoholism, leukemia, sickle cell anemia, syphilis, or other conditions resulting in optic nerve damage or inflammation. Examples of medications that can sometimes cause adverse effects that result in color-vision deficiency include, but are not limited to, certain medications used to treat heart problems, high blood pressure, infections, and nervous disorders.

There are many other eye conditions and visual disturbances other than color-vision deficiency. Examples of these problems and disturbances include halos, blurred vision (i.e., the loss of sharpness of vision and the inability to see fine details), and blind spots or scotomas (i.e., dark “holes” in the vision in which nothing can be seen, and loss of use of one eye, commonly called “monocular vision”). The degree to which these conditions and disturbances can affect a person's ability to perform safely varies by individual, depending on the specific job duties a person performs as a certified locomotive engineer or conductor, the nature and severity of the condition, the degree to which the visual disturbance is corrected with treatment, and in certain cases, the degree to which a person can compensate for the disturbance. Persons with monocular vision can sometimes, on a case-by-case basis, compensate for a limited degree of peripheral vision field loss by head turning.

FRA's locomotive engineer and conductor qualification and certification rules do not require railroads to categorically disqualify or decertify individuals who do not meet the vision thresholds in 49 CFR 240.121(c) or 242.117(h) because they may have a color-vision, sub-threshold distance visual acuity, or field of vision (e.g., monocular vision) deficiency, if they are otherwise qualified. To the contrary, 49 CFR 240.121(e) and 242.117(e) require railroads to subject, upon request, persons who do not meet those thresholds to further medical evaluation by the railroad's medical examiner to determine whether the person can safely perform as a locomotive engineer or conductor. FRA's longstanding view is that there are some people who, despite not meeting the vision threshold in 49 CFR 240.121(c) and 242.117(h), have sufficient residual visual capacity to safely perform as a locomotive engineer or conductor.

The Railway Association of Canada (RAC) has published medical guidelines that are applicable to qualification and certification of locomotive engineers in Canada.4 FRA allows railroads to adopt the monocular vision criteria in the RAC's guidelines under the railroad's own authority.

Depending on their assigned responsibilities, a person generally must have sufficient distant visual acuity and field of vision to see railroad signals and stationary and moving objects such as other locomotives, workers, and railroad equipment on or near the track, to perform safely as a locomotive engineer or conductor. Should a person perform as a locomotive engineer or conductor on portions of the railroad system on which colors of railroad signals convey information about speed, routing, or obstructions or other hazards, a person with that responsibility must additionally have sufficient color vision to safely perform.

FRA recognizes that railroads may assign some employees the responsibility to recognize and distinguish color light railroad signals, but not other employees. For example, some passenger conductors may not have responsibility to recognize and distinguish between colors of railroad signals. FRA also recognizes that some locomotive engineers and conductors only perform service in unsignalled (i.e., dark) territory or in territories where they do not have responsibility to recognize and distinguish between one or more types of colored railroad signals (e.g., wayside color light signals, color-position light signals, and blue flag signals). Although FRA's certification regulations require that both locomotive engineers and conductors be vision-tested, including color-vision, regardless of the actual operating or working conditions, a railroad's medical examiner should be cognizant of whether a person with a color-vision deficiency already works or could work safely in dark territory. Medical examiners should also keep in mind that even though a person may only work in dark territory, that person may still need to be able to identify colored items such as blue signals or roadway worker flags.

There are many types of eye conditions and visual disturbances ranging in severity from very mild to severe and many types and designs of railroad signals and railroad operating rules. Accordingly, FRA's locomotive engineer and conductor qualification and certification rules grant railroad medical examiners discretion in determining the methods and procedures the medical examiner will use to further evaluate persons who do not meet the vision thresholds in 49 CFR 240.121(c) and 242.117(h). In the 1991 final locomotive engineer certification rule, FRA stated that “[m]edical discretion will allow railroads to respond appropriately when they encounter individuals who fail to meet FRA-prescribed acuity levels, but demonstrate that they can compensate to a sufficient degree for their diminished acuity level.” 56 FR 28228, 28235; June 19, 1991. FRA granted railroad medical examiners similar discretion in further evaluating persons for the purposes of conductor qualification and certification. FRA states in its locomotive engineer and conductor certification rules that, should a person not meet specific vision thresholds, appropriate further evaluation may include optometric or ophthalmologic referral, or (secondary) testing with a field or other practical or scientific screening test. Although FRA's rules grant discretion to railroads in selecting a test protocol, FRA's longstanding interpretation of this provision is that the test offered by a railroad must be a valid, reliable, and comparable test for assessing whether a person who fails an initial vision test can safely perform as a locomotive engineer or conductor.

A “practical test,” more commonly known as a “field test” within the railroad community, is a test performed outdoors under test conditions that reasonably match actual operating or working conditions. A railroad is permitted to conduct field testing on a moving train, positioned in a stationary locomotive, or standing on the ground at distances from a signal or other object that the person must see and recognize to perform safely as a locomotive engineer or conductor.

Before issuing this interpretation, FRA contacted several organizations to collect information that would help in the development of recommended best practices for field tests, and FRA has captured that feedback in memoranda and documents it has placed in the docket. First, FRA wants to thank the American Academy of Ophthalmology and the American Optometric Association for providing expert medical information regarding testing and evaluating color perception during six conference calls held with FRA personnel. Second, FRA wants to thank the Brotherhood of Locomotive Engineers and Trainmen (BLET) and United Transportation Union-SMART Transportation Division for providing information and concerns regarding the strengths and weaknesses of current field testing practices, and asking that FRA find a way to encourage each railroad to conduct such field testing, during a conference call with FRA personnel. Third, FRA wants to thank the Association of American Railroads (AAR) for providing a written overview of the different practices currently used by various Class I railroads. AAR stated, in a July 14, 2015, Discussion on Color Vision Field Testing that field “testing is, at the moment, the preferred way of determining whether an individual's unique set of deficits actually impacts performance.” FRA provides best practices for designing valid, reliable, and comparable vision field tests in Section III, “Best Industry Practices for Conducting Color Vision Field Testing” of this interpretation.

A scientific vision test is a test instrument that, based on the results of a rigorous scientific study published in a peer-reviewed scientific or medical journal or other publication, is a valid, reliable, and comparable test for assessing whether a person has sufficient distance visual acuity, field of vision, or color vision, which, for purposes or railroad operations, allows the person to safely perform as a locomotive engineer or conductor. Examples of such scientific screening tests include, but are not limited to, a simulator, the Ishihara test and other color plate tests, a perimetry test (i.e., a test of field of vision), and a Snellen or equivalent distance visual acuity test. Should a railroad offer a scientific test to further evaluate persons who fail an initial test, FRA expects the test to be a valid, reliable, and comparable test for assessing whether the person can safely perform as a locomotive engineer or conductor despite not meeting the specific vision threshold (i.e., distance visual acuity, field of vision, or color perception) in 240.121(c) or 242.117(h). That means the railroad must be able to cite a rigorous scientific study published in a peer-reviewed scientific or medical publication that demonstrates the scientific test is a valid, reliable, and comparable test for that visual capacity. For example, Hovis and Oliphant, in 2000, published a validation test of a lantern test that they designed, the CNLAN lantern test. The authors rigorously validated the CNLAN lantern test in a peer-reviewed journal against a simulated field test with a high degree of content validity to show the CNLAN lantern test has a high degree of validity and reliability for assessing the ability to recognize and distinguish between aspects of color light railroad signals in Canada.5 Two major railroads in Canada use the CNLAN lantern test. Interested parties should note, however, that simply showing a person a lantern with different colored lights displayed is certainly not the same as the CNLAN lantern test, which is a scientifically validated test.

Validity means the degree to which a test actually measures what the test is intended to measure. For example, a color vision field test is valid to the degree that it assesses whether a person can recognize and distinguish between colors of the types of railroad signals in the yard or on all portions of railroad systems on which the person must perform safely, depending on the person's responsibilities. One way to estimate the validity of a test is to assess its degree of job-relatedness (content validity). The degree to which a field test's conditions match actual operating conditions determines, to a large extent, its validity.

Reliability means the degree of reproducibility of the test results. In this case, reproducibility means an examinee that is repeatedly administered the same test would demonstrate the same number of correct responses and missed signal responses each time the test is administered.

Comparability means the testing procedures are fairly administered and the test results are uniformly recorded. When tests have comparability, it is fair to compare test results between individuals regardless of whether different testing officers, or different railroads, administered the test. Additionally, for a test to be comparable, the testing officer must administer the test without any bias or prejudice.

In addition to field and scientific tests, FRA's locomotive engineer qualification and certification regulations also permit optometric or ophthalmologic referral which can provide important information about the nature and severity of a person's eye condition or visual disturbance. The referral can also provide information about whether the vision condition is stable or should be monitored more frequently than triennially by the railroad's medical examiner because it is likely to worsen to a level that would make it unsafe to perform service prior to a certified employee's next triennial recertification evaluation.

Sections 240.121(e) and 242.117(e) permit railroads to conditionally certify a person as a locomotive engineer or conductor if the railroad's medical examiner determines in writing that a special condition of certification is necessary on the basis of findings elicited on further evaluation of the person's vision. Examples of special conditions of certification include: (1) More frequent evaluation of an eye condition or visual disturbance by a railroad's medical examiner that will likely deteriorate prior to the person's next required triennial recertification examination to a level that the person may not be able to safely perform; (2) required use of corrective lenses (i.e., glasses or contact lenses) to correct distant visual acuity to a level that the person can safely perform as a locomotive engineer or conductor; (3) restriction to perform service only in unsignalled (dark) territory should a person be otherwise qualified but not have the ability to recognize and distinguish between colors of wayside railroad color light or color-position light signals; (4) restriction of service to unsignalled (dark) territory, or marking up for service only at night when there is greater brightness contrast between signals and the remainder of the operating environment, should a person demonstrate the ability to perform safely only under those operating conditions; or (5) restriction of service to performance in a yard or on portions of railroad systems where locomotives move at slower speeds, should a person be able to recognize and distinguish between colors of railroad signals at those slower speeds. There is research evidence that some individuals with color vision deficiency may be able to detect and recognize signal aspects at shorter sighting distance that exist in the yard or on portions of the railroad where locomotives move at slower speed to perform safely.6

FRA's locomotive engineer and conductor certification rules do not permit examinees to use chromatic lenses when taking an initial test the railroad selects from the list of accepted color vision test protocols in the appendices to parts 240 and 242. Although examinees may not use chromatic lenses during an initial color vision test, FRA grants each railroad the discretion to determine whether it will permit examinees to use chromatic lenses during a secondary field or other practical or scientific test offered by a railroad to further evaluate his or her ability to perform safely. However, since the time FRA last amended part 240, the Food and Drug Administration (FDA), issued the following cautionary information about the use of ChromaGen chromatic lenses: 7

a. ChromaGen lenses do not help wearers to see “new” colors or to perceive or appreciate colors as people with normal color vision do, but merely add brightness/darkness or hue differences to colors that are otherwise difficult or impossible to distinguish;

b. The ability to pass diagnostic color vision tests with ChromaGen lenses does not imply the ability to perform other color vision-related tasks. Therefore, ChromaGen lenses should not be used with diagnostic color vision tests to meet occupational performance requirements; and

c. Persons using the darker shades of tint in their ChromaGen lenses may experience some or all of the following: Reduced 10W contrast acuity, reduced illumination at night, distortions in distance perception of moving objects or while driving, distortions of apparent velocity. Wearing darker lenses, especially at night, or under foggy, misty, or other adverse conditions, may make driving an automobile difficult.

Based on FDA's findings, and the fact that railroads generally operate to a degree under similar environmental lighting and weather conditions as operating an automobile, FRA recommends that railroads take a conservative approach.

Railroads should not permit locomotive engineers and conductors that have responsibility to recognize and distinguish between colors of railroad signals to safely perform as locomotive engineers and conductors until data from a valid, reliable, and comparable research study clearly establishes operating conditions when it is safe to use chromatic lenses for that purpose, and then restrict use to those operating conditions. Please note that both the FDA and FRA make a distinction between chromatic lenses and contact lenses manufactured to correct distant, intermediate, and near visual acuity that have a very light blue tint to aid the user in locating, handling, and cleaning the contact lens. Railroads should not prohibit use of those blue-tinted contact lenses during testing and when performing as a locomotive engineer or conductor.

The railroad medical examiners are required by FRA certification regulations to document the basis for his or her decision that a person can or cannot safely perform as a locomotive engineer or conductor. This includes reports of testing, and should the examiner use optometric or ophthalmologic referral, the report of testing and evaluation from the optometrist or ophthalmologist.

FRA's locomotive engineer and conductor regulations require each railroad subject to those regulations to have a written visual testing program on file with FRA. Among other things, the certification program must include a railroad's procedure for evaluating the visual acuity of its locomotive engineers and conductors when those train crew members fail to meet the vision threshold criteria provided for in parts 240 and 242. See 49 CFR 240.101, 240.121, 242.101, and 242.117; 49 CFR part 240 Appendix F, and 49 CFR part 242 Appendix D. Such procedure is especially necessary to address situations where locomotive engineers and conductors have a history of safe performance that would normally suggest that they have the ability to safely perform their duties. A review of the programs on file with FRA, however, revealed that the railroads do not sufficiently describe their field testing procedures to allow FRA to determine whether those procedures are likely to produce valid, reliable, and comparable field tests. Thus, each railroad that utilizes field testing procedures should review the best practices provided in this interpretation and update its programs accordingly under part 240 and part 242.

FRA considers this type of program modification to be a “material modification” requiring railroads to submit their revised programs to FRA for review and approval. See 49 CFR 240.103(e) and 242.103(i). Before implementing a change to its field testing procedures, a railroad must submit a description of how it intends to modify the procedures in its program. For part 240 programs, the description of the modification must be submitted to FRA at least 30 days prior to implementation. See 49 CFR 240.103(e). For part 242 programs, the description of the modification must be submitted to FRA at least 60 days prior to implementation. See 49 CFR 242.103(i). The modified program is considered approved and may be implemented 30 days after being filed with FRA unless FRA notifies the railroad in writing that the program does not conform to the criteria set forth in parts 240 and 242. To facilitate the submission of modified programs to FRA, railroads may submit both parts 240 and 242 programs electronically using the procedures described in Appendix B to Part 242 for “Submission by a Railroad.”

The following best practices are intended to guide each railroad in designing, implementing, and scoring color vision field testing for locomotive engineer and conductor certification. They are broadly drafted to allow each railroad to develop field testing procedures that will work for its own operational environment and to consider the unique medical circumstances of each examinee tested. Furthermore, these best practices will guide railroads to establish best field testing practices. Of course, FRA recognizes and appreciates that some railroads already follow many of these best practices, and will readily adopt additional best practices that are viewed as making the field test more valid, reliable, and comparable. FRA encourages each railroad to consider adopting all best practices.

(1) Standardize Test Procedures. The railroad's procedures for administering and scoring the test are standardized, and the railroad strictly adheres to the procedures established.

(2) Qualified Supervisor Conducts the Test. The person administering and scoring the field test (testing officer) is qualified to supervise certified locomotive engineers or conductors, as appropriate, and has knowledge of the railroad's field testing procedures.

(3) The Testing Officer's Vision Meets the Regulatory Medical Thresholds. For purposes of administering and scoring the field test, the testing officer meets the medical thresholds in 49 CFR 240.121(c) and 49 CFR 242.117(h).

(4) Record the Test Results During Testing. The railroad uses a standard form or method to record all relevant information. For example, the railroad may design a field testing form that will prompt the testing officer to record administrative and test data information such as:

a. The date and location of the test;

b. The participants' names and contact information;

c. The number of signals viewed;

d. Which signals were incorrectly identified; and

e. The aspects of each signal encountered.

(5) Capture All Essential Data and Void Tests With Incomplete Data. The railroad should design any standard form or method used so the testing officer must record all relevant information in a manner ensuring that all essential standard procedures for testing have been followed. If a form is required, and it is missing essential data, the railroad must void the test.

(6) Testing Officer Affirms Test Data Accurately Recorded. The railroad may gain an additional level of assurance by requiring the testing officer to sign an affirmation that the testing officer strictly adhered to the railroad's field testing procedures and that the data recorded was accurately documented.

(7) Prior to Test, Inform the Examinee of the Test's Purpose and Procedures. Each railroad should standardize the procedures for informing the examinee of the purpose of the test, what the examinee is required to do during the test, and how test data will be documented and scored. For example, before the start of the test, the testing officer reads a set of instructions out loud and answers any questions. An example of an alternative or additional approach would be to provide a written explanation and test instructions directly to the examinee before the test, either as a separate document or at the top of a railroad's testing form. The railroad may consider it a timesaver to provide this information to the examinee before the test so less time is spent explaining the testing protocol on the day of the test.

(8) Considerations When Examinee Wears Corrective Lenses. The examinee should be offered the opportunity to wear contact lenses or glasses prescribed by his or her optometrist or ophthalmologist to correct his or her distant visual acuity.

a. Light Blue Tint May Be Acceptable. Please note that both the FDA and FRA make a distinction between chromatic/ChromaGen lenses and contact lenses manufactured to correct distant, intermediate, and near visual acuity that have a light blue tint added solely to aid the user in locating, handling, and cleaning the contact lens. Thus, use of contact lenses with this type of tinting should be permitted.

b. Corrective Lenses Worn During Test Must Be Worn On-Duty, If Certified. The examinee should be warned that the use of any lenses or glasses during a passed test will result in conditioning of the examinee's locomotive engineer or conductor certification on wearing those lenses or glasses.

c. Notify Examinee, Preferably in Writing at Time of Test, What To Do If Corrective Lenses Are No Longer Needed In the Future. If an examinee's certification is conditioned on wearing lenses or glasses, the railroad should notify the examinee in writing that if the examinee's eyes improve, whether on their own or through corrective surgery, the examinee should immediately contact the relevant railroad official who can verify the improved vision and remove the restriction from the certificate and certification records. The railroad should consider including this information on the copy of the test form provided to the examinee.

(9) Either Prohibit Examinees from Wearing Chromatic/ChromaGen Lenses or Understand Their Limitations and Proceed Accordingly. The FDA has issued cautionary information on the use of chromatic or ChromaGen lenses. Therefore, each railroad medical examiner should understand the limitations of these lenses before deciding whether to allow an examinee to wear them during a field test.

(10) Consider Whether a Vision Condition Is Stable or Deteriorating. Both examinees with stable vision deficiency conditions and those with deteriorating vision may pass field tests, but that does not mean a railroad, or its medical examiner, should treat these examinees in the same manner. FRA's regulations permit a railroad's medical examiner to consider an examinee's known medical condition, and find that the person either cannot be trusted to operate safely given the volatility of the condition or recommend that the examinee's certification be conditioned on more frequent medical or field testing vision testing than the minimum FRA mandate of every 3 years.

(11) Design Tests With Validity, Reliability, and Comparability.

a. Validity to the Examinee's Expected Duties. The railroad should design the test so that the examinee is tested on railroad signal indications the examinee will be expected to recognize and comply with as part of the examinee's typical locomotive engineer or conductor duties. The railroad should require the testing officer to allow the examinee an attempt to recognize signal aspects or indications within the same timeframe, at the appropriate sight distances, as the examinee would be expected to recognize the signal under actual operating or working conditions. Because the field test conditions should reasonably match actual operating or working conditions, the test should be performed outdoors. The examinee may be either on a moving train, positioned in a stationary locomotive, or standing on the ground at distances from a signal or other object that the person must see and recognize to perform safely as a locomotive engineer or conductor.

b. Assess Content Validity.

i. Conduct Test On Actual Working Conditions. The railroad should generally administer the test over territories where the examinee has previously demonstrated knowledge of the physical characteristics and will continue to work, if certified. If this is not feasible or practical, the tests should generally be administered over territories where the examinee will be expected to work upon being certified or recertified, to the extent possible. Under all conditions, the tests should be administered to replicate actual operating conditions that the examinee will encounter as a certified locomotive engineer or conductor.

ii. FRA Does Not Require System-Wide Certification, Restrictions Permitted. A railroad should not test the examinee on every possible railroad signal indication on the system if the examinee has previously been limited to yards, divisions, or other territories where the examinee would only encounter a subset of the types of signal indications found system-wide and the examinee has demonstrated a positive safety record. Moreover, the examinee's certification should be restricted to that limited work arrangement.

iii. Consider Whether a Person Works in Dark Territory or is Not Required to Recognize Signals. Not all railroad employees are assigned responsibility by a railroad to recognize and distinguish colored railroad signals. For those employees, providing a field test that requires recognition of colored railroad signals would not be a valid test. Rather, the field test in that instance should focus on whether the employee can safely perform his or her duties. For example, the field test may require the employee to identify blue signals or roadway worker flags.

iv. If Expanding Examinee's Actual Working Conditions, Provide Rationale. If a railroad intends to implement a system-wide type test for an examinee who has not previously worked system-wide, the railroad should provide its rationale for doing so. It is not acceptable for a railroad, or its medical examiner, to inform an examinee that the railroad must ignore a demonstrated positive safety record with a limited work arrangement because FRA's regulations apply a stricter standard, as that is not a true statement.

c. Reliability.

i. Signal Sequence Should Not Be Predictable. The railroad should consider the sequencing of railroad signal indications to remove the likelihood that an examinee could pass the test by predicting each signal with an educated guess. For instance, signals that predictably follow a particular sequence familiar to the examinee should be avoided. A qualified supervisor should know where these sequenced signal indications may occur and either avoid them for testing purposes or arrange for them to display an uncharacteristically different sequence of signal indications.

ii. Remove Chance Guesses By Testing Each Signal Multiple Times. The railroad should consider the number of signal indications viewed to remove the likelihood that an examinee could pass the test by chance guess. Statistics suggest that a minimum of 3 to 6 repetitions of the same signal indication may be necessary to avoid the chance that an examinee can pass with guesses. A railroad may certainly consider additional repetitions of a signal indication if it is designed to probe an examinee's ability to correctly identify signal aspects that a person with the examinee's known color vision deficiency is likely to confuse with another aspect.

iii. Signal Aspects Must Be Actual Signals or Similar, And In Good Working Condition. The blue flag, sign, or signal light used in testing must be of similar size and chromaticity 8 to the actual signal the person must recognize to safely perform locomotive engineer or conductor duties. For example, an unacceptable field testing practice is use of colored light bulbs that do not have similar size, chromaticity, and transmittance as colored lenses of railroad signals on the railroad systems on which the examinee is expected to perform as a locomotive engineer or conductor. Another unacceptable field testing practice is use of a railroad signal that has an incandescent light source to test an examinee on a safety-critical signal aspect that would typically be displayed by a signal with an LED light source. Similarly, it would be unacceptable to conduct a test with a well-worn, faded blue flag.

iv. Consider Daylight, Darkness, and Weather Conditions to the Extent Those Factors Might Skew the Test Results. The railroad's procedures should allow a medical examiner to inform the testing officer that a particular examinee must be tested at night (i.e., under darkness) or during the day with bright sunshine, or under some other condition, so that the test can appropriately focus on the examinee's known color vision deficiency found during the initial medical testing and will be an accurate indicator of whether the examinee can safely perform anticipated locomotive engineer or conductor duties. For most people, signal visibility will be the greatest at night and more challenging during the daytime in bright sun when the sky is clear. Field testing conducted at sunrise or sunset may pose a greater likelihood that severe glare could skew test results such that it would be difficult for individuals with normal color vision to identify a signal indication or aspect. FRA's regulations do not prohibit a railroad from requiring multiple field tests under different operating or working conditions, and certainly some examinees will warrant such testing based on their known vision deficiency. Likewise, if a test is conducted during a snowstorm, rainstorm, fog, or other weather conditions that would inhibit a person's vision, acceptable sight distances should be adjusted accordingly, and in some instances, may suggest that a test cannot be verified as reliable and should be voided.

d. Comparability.

i. Implement Procedures To Address Bias Accusations. To effectively address accusations that a particular test was unfairly designed, implemented, or scored, a railroad should allow the examinee to bring along a volunteer witness of the examinee's choosing, and all participants, including witnesses, should be afforded an opportunity to record their observations regarding whether testing procedures were followed and the conditions under which the test was conducted. The testing officer should have a standard method that will capture the names and contact information of any witnesses who observe the test, and the railroad should permit the examinee and any witnesses an opportunity to submit their observations in writing for direct review by the railroad's medical examiner. The railroad should provide the medical examiner with the authority to void any test in which the examinee or another witness makes a substantial showing that bias or prejudice may have led to a test failure and, in such a situation, request that a new test be conducted with a different testing officer.

ii. Create Adequate Records and Provide to Examinee. Because an examinee who fails a field test and is subsequently denied certification or recertification may request FRA to review that decision, each railroad should be prepared to provide the examinee with the results of any field tests. A railroad should consider developing a method or protocol by which the testing officer offers a copy of the completed test form to the examinee upon completion of the test. The railroad may want the testing officer to record on the form whether the examinee was offered a copy of the form, and whether the examinee accepted receipt. The form may also include a signature line for the examinee to acknowledge receipt of the completed test form.

Atlantic sharks are managed under the authority of the Magnuson-Stevens Fishery Conservation and Management Act (Magnuson-Stevens Act), and the authority to promulgate regulations under the Magnuson-Stevens Act has been delegated from the Secretary to the Assistant Administrator (AA) for Fisheries, NOAA. On October 2, 2006, NMFS published in the Federal Register (71 FR 58058) final regulations, effective November 1, 2006, which detailed management measures for Atlantic HMS fisheries, including for the smoothhound shark and Atlantic shark fisheries. The implementing regulations for the 2006 Consolidated HMS FMP and its amendments are at 50 CFR part 635. This final rule implements the conservation and management measures from Amendment 9 in the Atlantic shark and smoothhound shark fisheries and the measures in Amendment 3 and 2011 HMS Trawl Rule in the Atlantic smoothhound shark fishery.

A brief summary of the background of this final action is provided below. A more detailed history of the development of these regulations and the alternatives considered are described in the Final Environmental Assessment (EA) for Amendment 9, which can be found online on the HMS Web site (see ADDRESSES).

NMFS published a proposed rule on August 7, 2014 (79 FR 46217), outlining the alternatives analyzed in the Draft EA, identifying preferred alternatives, and soliciting public comments on the measures, which would impact the smoothhound shark and Atlantic shark fisheries. Specifically, the proposed rule included the following measures: For smooth dogfish only, modifying prohibitions on at-sea fin removal to be consistent with the SCA; implementing Term and Condition 4 of the 2012 Shark BiOp; based on updated catch data, adjusting the smoothhound shark quota finalized in Amendment 3; and modifying the VMS requirements for shark gillnet vessels. The full description of the management and conservation measures considered is included in both the Final EA for Amendment 9 and the proposed rule and is not repeated here.

The comment period for the Draft EA and proposed rule for Amendment 9 ended on November 14, 2014. The comments received, and responses to those comments, are summarized below under the heading labeled Response to Comments.

Management measures in Amendment 9 will impact both the smoothhound shark and Atlantic shark fisheries. This rule finalizes most of the management measures, but modifies others, that were contained in the Draft EA and proposed rule for Amendment 9. This section provides a summary of the final management measures being implemented by Amendment 9 and notes changes from the proposed rule to this final rule. Measures that are different from the proposed rule, or measures that were proposed but not implemented, are described in detail under the heading titled Changes from the Proposed Rule.

This final rule implements the smooth dogfish-specific measures in the SCA to establish an allowance for the removal of smooth dogfish fins while at sea. To implement the measures, the proposed rule considered three categories of requirements—catch composition, state permitting, and geographic applicability of the exceptions—and a range of alternatives within each category (“sub-alternatives”). Only fishermen that meet the requirements under all three of these categories and that are, as specified in the Act, fishing within 50 nautical miles of shore and possess fins in an amount that does not exceed 12 percent of the carcass weight, would be authorized to remove smooth dogfish fins at sea.

For catch composition, NMFS preferred in the proposed rule a sub-alternative that would have required that smooth dogfish make up at least 75 percent of the retained catch on board and that no other sharks could be retained. For state permitting, the proposed rule included a sub-alternative that would have required an individual to hold a state commercial fishing permit that allows smooth dogfish retention, in addition to a Federal smoothhound permit. With regard to geographic applicability, the proposed rule included a sub-alternative that would have applied the SCA exception for smooth dogfish along the entire Atlantic coast but not to Florida's coast in the Gulf of Mexico. During the public comment period, NMFS received support for the two proposed sub-alternatives related to state fishing permits and geographic applicability of the SCA provisions. However, NMFS received many comments opposing the catch composition requirement of 75 percent and the “no other sharks on board” provision. Commenters expressed concern that these requirements do not meet the intent of the statutory exception because they do not reflect the mixed nature of catch in the smooth dogfish fishery and would render the exception largely meaningless. They also stated that the catch composition requirement would lead to excessive dead discards and would be burdensome.

As detailed under the Changes from the Proposed Rule heading, NMFS is implementing the two sub-alternatives related to state fishing permits and geographic applicability of the exception as originally proposed. NMFS is changing the catch composition requirement and will require smooth dogfish to make up at least 25 percent of the total retained catch in order to remove the fins of smooth dogfish while at sea. Additionally, fishermen may retain other sharks on board provided that the fins of other shark species remain naturally attached to the carcass through offloading. Only fishermen adhering to the measures in the three sub-alternatives, as well as fishing within 50 nautical miles of shore and possessing fins in an amount that does not exceed 12 percent of the carcass weight, will be authorized to remove smooth dogfish fins at sea.

This final rule also establishes separate Atlantic and Gulf of Mexico regional smoothhound shark total allowable catches (TACs) and commercial quotas based on the results of the 2015 Southeast Data Assessment and Review (SEDAR) 39 stock assessments for smoothhound sharks. The assessments were finalized and peer reviewed in March 2015. On June 29, 2015, NMFS issued a stock status determination notice (80 FR 36974) that stated that “[d]ata from tagging and genetic research in SEDAR 39 support the existence of two distinct Atlantic and Gulf of Mexico stocks of smooth dogfish separated by peninsular Florida. Therefore, smooth dogfish was treated as two separate stocks, one in the Atlantic region and one in the Gulf of Mexico region.” 80 FR 36974 (June 29, 2015). Each stock had a status of not overfished with no overfishing occurring. Based on public comments requesting that commercial quotas be based on stock assessments and not landings, NMFS is implementing regional smoothhound shark TACs and commercial quotas based on SEDAR 39, instead of the proposed, single overall quota based on landings data. Specifically, while we proposed an overall commercial quota of 1,739.9 mt dw covering both the Atlantic and Gulf of Mexico regions (using commercial landings data in the absence of a stock assessment), this final rule establishes separate regional TACs and commercial quotas within those TACs as follows: An Atlantic regional smoothhound shark TAC of 1,430.6 mt dw with a commercial quota of 1,201.7 mt dw, and a Gulf of Mexico regional smoothhound shark TAC of 509.6 mt dw with a commercial quota of 336.4 mt dw. Implementing these science-based TACs and commercial quotas will ensure continued sustainable harvest of smoothhound sharks in the Atlantic and Gulf of Mexico regions and increase the likelihood of maintaining healthy smoothhound shark stocks in both regions. Additional details are provided below under the heading Changes from the Proposed Rule.

Term and Condition (TC) 4 of the 2012 Shark BiOp addressed soak time and net check requirements for gillnet gear. In order to comply with TC 4, this final rule modifies the soak time and net check requirements based on the type of gillnet gear used in the Atlantic shark and smoothhound shark fisheries. NMFS has determined that current regulations meet the specifications for other TCs in the 2012 BiOp. This final rule will establish a soak time limit of 24 hours for sink gillnet gear and a 0.5 to 2 hour net check requirement for drift gillnet gear in the Atlantic shark and smoothhound shark fisheries. This requirement would not significantly change smoothhound shark fishing practices, since most smoothhound shark gillnet fishermen primarily use sink gillnet gear and those fishermen already use a soak time of 24 hours or less.

This final rule also modifies current regulations related to the use of VMS by federal directed shark permit holders using gillnet gear. Before this rule, federal directed shark permit holders with gillnet gear on board were required to use VMS regardless of vessel location in order to simplify compliance and outreach for fishermen operating across multiple regions. This requirement was implemented as part of the 2003 Amendment 1 to the 1999 FMP for Atlantic Tunas, Swordfish, and Sharks to ensure shark gillnet vessels were complying with the Atlantic Large Whale Take Reduction Plan (ALWTRP) time/area closures and observer requirements (50 CFR 229.32). However, since implementation, it has become apparent that while some fishermen do fish in multiple regions, many do not fish in or even near the Southeast U.S. Monitoring Area. As such, this final rule will require federal directed shark permit holders with gillnet gear on board to use VMS only in the vicinity of the Southeast U.S. Monitoring Area, pursuant to ALWTRP requirements. Requirements to minimize large whale interactions would not change; rather, only the geographic area of the VMS requirement would change, consistent with the ALWTRP.

This final rule also establishes an effective date for previously-adopted smoothhound shark management measures in Amendment 3 and the 2011 HMS Trawl Rule. The final rule implementing conservation and management measures in Amendment 3 published on June 1, 2010 (75 FR 30484) but delayed the effective date of the smoothhound shark management measures until approximately 2012 pending approval for the data collection measures under the Paperwork Reduction Act (PRA) by the Office of Management and Budget (OMB), to provide time for implementation of a permit requirement, to provide time for NMFS to complete a Biological Opinion under Section 7 of the Endangered Species Act (ESA), and to provide time for affected fishermen to change business practices, particularly as it related to keeping shark fins attached to the carcass through offloading. OMB approved the PRA data collection in May of 2011 and NMFS met informally with smoothhound shark fishermen along the east coast in the fall of 2010. In November 2011, NMFS published a rule (76 FR 70064, November 10, 2011) that indefinitely delayed the effective date for all smoothhound shark management measures in both Amendment 3 and in another rule, the 2011 Final Rule to Modify the Retention of Incidentally-Caught Highly Migratory Species in Atlantic Trawl Fisheries (76 FR 49368, August 10, 2011 (2011 HMS Trawl Rule)), to provide time for NMFS to consider the smooth dogfish-specific provisions in the SCA and for NMFS to finalize a Biological Opinion on the federal actions in Amendment 3, among other things. Previously-adopted management measures from Amendment 3 that will become effective on January 1, 2016, include: A research set-aside quota; an accountability measure (AM), which closes the fishery when smoothhound shark landings reach, or are expected to reach, 80 percent of the quota; a requirement for a dealer permit to purchase smoothhound sharks; a requirement for dealers to report smoothhound shark purchases; a smoothhound permit requirement for commercial and recreational fishing and retention; a requirement for vessels fishing for smoothhound sharks to carry an observer, if selected; a requirement for vessels fishing for smoothhound sharks to comply with applicable Take Reduction Plans pursuant to the Marine Mammal Protection Act (MMPA); and a requirement for commercial vessels to sell catch only to Federally-permitted shark dealers. Management measures affecting smoothhound sharks in the HMS Trawl Rule will allow retention of smoothhound sharks caught incidentally with trawl gear, provided that the total smoothhound shark catch on board or offloaded does not exceed 25 percent of the total catch by weight.

Finally, this rule makes administrative changes to the observer regulations. Currently, the Atlantic shark fishery observer program is administered by the Southeast Fisheries Science Center (SEFSC). However, a portion of the commercial smoothhound shark fishery occurs in the Northeast region in an area typically covered by observer programs administered out of the Northeast Fisheries Science Center (NEFSC). Since the fishery spans the geographic area of both the NEFSC and SEFSC, smoothhound shark observer regulations need to accommodate the administrative processes of both programs. The two regional science center observer program processes are slightly different. The SEFSC process is currently outlined in the 50 CFR part 635 regulations but the NEFSC process is not. Thus, this final rule implements changes to the observer regulations in 50 CFR part 635 to incorporate the relevant portions of the NEFSC observer regulations found at 50 CFR part 648.

During the proposed rule stage, NMFS received approximately 500 written comments from fishermen, States, environmental groups, academia and scientists, and other interested parties. NMFS also received feedback from the HMS Advisory Panel; constituents who attended the two public hearings in October 2014 in Toms River, New Jersey, and Manteo, North Carolina; and constituents who attended the conference calls/webinars held on September 24 and November 4, 2014. Additionally, NMFS consulted with the New England, Mid-Atlantic, South Atlantic, Gulf of Mexico, and Caribbean Regional Fishery Management Councils, along with the Atlantic States and Gulf States Marine Fisheries Commissions. A summary of the comments received on the proposed rule during the public comment period is provided below with NMFS's responses. All written comments submitted during the comment period can be found at http://www.regulations.gov by searching for NOAA-NMFS-2014-0100.

Comment 1: NMFS received comments in support of Alternative A1, which would not implement the smooth dogfish-specific measures in the Shark Conservation Act of 2010 and would require fins and tails of all smooth dogfish to remain naturally attached through offloading. Commenters felt that these exceptions to the U.S. ban on at-sea shark fin removal would jeopardize our nation's reputation as a shark conservation champion, and hurt U.S. arguments in support of Regional Fishery Management Organizations' adoption of fins attached requirements. Commenters also felt that the fins naturally attached method was widely recognized as the best practice for accurate data collection and enforcement of finning bans. Commenters felt that adopting a fins attached exception for smooth dogfish would undermine state bans on finning and would widen loopholes in certain state bans on the trade in shark fin products.

Response: The Shark Conservation Act of 2010, which includes the smooth dogfish-specific exception, became Federal law upon Presidential signature on January 4, 2011. Thus, NMFS must implement the law in a manner that reflects Congressional intent. The Congressional provision clearly creates an exception that allows removal of smooth dogfish shark fins at sea under certain circumstances and did not leave the Agency discretion to forego implementation of the exception.

Comment 2: NMFS received a comment stating that the 12 percent fin-to-carcass ratio included in the smooth dogfish-specific provision of the SCA was too high and should be lower.

Response: The 12 percent fin-to-carcass ratio is explicitly included in the smooth dogfish-specific provision of the SCA. Thus, NMFS must implement the provision as mandated. Nevertheless, some data support that a 12 percent fin-to-carcass ratio may be a close approximation of the true ratio for smooth dogfish. In the Atlantic States Marine Fisheries Commission (ASMFC) Shark Board briefing materials prepared for a May 21, 2013 meeting, the States of New Jersey and New Carolina provided analyses of smooth dogfish fin-to-carcass ratios using both landings data and direct measurements of processed sharks. Those analyses found a range of fin-to-carcass ratios from 7.5 percent to 13 percent, depending on the level of processing (e.g. whether the belly flaps were removed, whether the tail was retained).

Comment 3: NMFS received a large volume of comments expressing concern that the smooth dogfish-specific provision of the Shark Conservation Act allows finning of sharks. These commenters asked NMFS not to implement this provision and many of the comments provided information about the negative ecological impacts of sharks finning.

Response: The large volume of comments opposing finning of smooth dogfish appears to be based on a misunderstanding on this action. Finning, which is the removal of shark fins and disposal of the carcass at sea, has been prohibited in Atlantic U.S. shark fisheries since 1993, and will continue to be prohibited in all Atlantic shark fisheries. The exception in the Act allows for the removal of the fins at sea rather than requiring the sharks to be landed with their fins attached as the Act requires for other shark species. The fins and the carcasses still must be landed together.

Comment 4: NMFS received several comments, including from the SAFMC, MAFMC, and the States of New Jersey, North Carolina and Maryland, opposing the proposed sub-alternative A2-1c that smooth dogfish must make up at least 75 percent of the retained catch (no other sharks can be retained). Commenters felt that the 75 percent catch composition would be difficult to enforce and burdensome for fishermen. Some felt that the 75 percent would lead to waste and discarding in cases where fishermen found that their catch percentages did not qualify them for the at-sea processing allowance. Others emphasized that the smoothhound fishery is a mixed fishery, and that fishermen needed more flexibility if the SCA exception were to have any utility. NMFS also received comments that the 75 percent catch composition was inconsistent with ASMFC requirements and that the new federal requirements might push fishermen into state waters where there are no catch composition requirements. Commenters felt that as a consequence, fishermen may avoid obtaining a federal smoothhound shark permit, leading to less data for federal mangers. NMFS received support from the MAFMC and the state of New Jersey for sub-alternative A2-1b that would require smooth dogfish make up at least 25 percent of the retained catch. NMFS also received some limited support for the 75 percent catch composition.

Response: In the Draft EA and proposed rule, NMFS interpreted the phrase “fishing for smooth dogfish” to mean fishing with the object of commercially harvesting smooth dogfish, but also emphasized that the SCA had specified that the exception applies when an individual is fishing “for” smooth dogfish as opposed to fishing “for” other species and incidentally catching smooth dogfish or simply stating that it applies “when fishing.” We then preferred a sub-alternative that smoothhound sharks must make up 75 percent of the retained catch on board a vessel to constitute a trip fishing “for” smooth dogfish and stated that this would preclude fishermen on trips for other species but who incidentally catch smooth dogfish from removing smooth dogfish fins at sea. The catch composition threshold of 75 percent is used in other fisheries that interact with HMS (e.g., incidental swordfish catch in the squid trawl fishery) to distinguish between directed and incidental fisheries and NMFS felt this high level of retention was an appropriate way to identify those fishing “for” smooth dogfish.

Based on public comments, however, it has become apparent that the 75 percent level used in other fisheries is not appropriate in the smooth dogfish fishery and does not accurately reflect fishing practices in that fishery. To verify the feedback from commenters, NMFS reviewed data on the mixed nature of the smoothhound shark fishery and how well catch composition reflects the fishery and discovered that, as asserted by the commenters, the smooth dogfish fishery is far more mixed than NMFS assumed in the proposed rule. As a result, implementing a 75 percent catch composition requirement would make the exception largely meaningless. Thus, while NMFS' objective for the implementation of the smooth dogfish-specific provision of the SCA remains the same as described in the Draft EA, and NMFS still needs to give meaning to the phrase “fishing for smooth dogfish” as opposed to simply “fishing,” NMFS agrees with the majority of the commenters that a catch composition requirement of 25 percent is more appropriate. This is consistent with the smooth dogfish-specific provision in the SCA that limits the exception to those fishermen that are fishing “for” smooth dogfish while acknowledging the need for enhanced flexibility in a mixed fishery. The reasons for the change include the four following factors, which were reflected in public comment on the proposed rule:

• Sink gillnet gear, the predominant gear used in the directed smooth dogfish fishery, often catches other species along with the targeted species. If a fisherman retains other legal species in an amount greater than 25 percent of the total retained catch, it does not necessarily mean that effort was not being directed on smooth dogfish, it could simply mean that other species were encountered in a greater amount than anticipated.

• Although a 75 percent catch composition is an appropriate indicator of target species in other HMS fisheries, such as the squid trawl fishery, it is not appropriate at this time in the smooth dogfish fishery. In the squid trawl fishery, swordfish caught in squid trawls can only be retained if at least 75 percent of the retained catch is squid, indicating that squid is the targeted fishery. In that fishery, the catch is predominantly squid but swordfish that are feeding on the squid are sometimes inadvertently caught. The smooth dogfish fishery is a more mixed fishery and the target species is often co-located with other species, resulting in less certainty of target species catch levels

• When fishermen decide to remove fins from smooth dogfish while at sea, the fins are not removed at the end of the trip. Rather, the fins are removed shortly after the smooth dogfish is brought on board in order to maintain the highest quality product. This processing method negates the benefits of a high catch composition requirement. For example: If a fishermen is directing effort on smooth dogfish and removing the fins as the smooth dogfish are brought on board, that fishermen does not know what the final catch composition will be. The first part of the trip could be 100 percent smooth dogfish, but if the catch transitions to predominantly other species, the fishermen may have found that he no longer meets the high catch composition requirement. In that case, the fisherman has two options: To either discard all the smooth dogfish carcasses and fins that have been processed or discard the non-smooth dogfish catch in an amount that will meet the catch composition requirement. Either way, a high catch composition could lead to unnecessary regulatory discards. Although this last example could also pertain to the preferred 25 percent catch composition, the lower threshold provides a greater amount of flexibility and reduces the instances of regulatory discards, consistent with National Standard 9.

• Smooth dogfish, and the fishery that targets them, closely follow specific water temperature gradients. Fisherman intending to land primarily smooth dogfish may find their gear in sub-optimal water temperatures leading to lower smooth dogfish catch despite the intention to directly target the species and resulting in a lower catch composition than expected.

Comment 5: NMFS received comments that NMFS was interpreting the smooth dogfish-specific provisions in the SCA incorrectly because the provision does not specify its application to the directed or incidental smooth dogfish fishery and that limiting fishermen to a directed fishery would only serve to inflict financial hardships on fishermen.

Response: The SCA does not explicitly state that it applies only to directed fisheries; however, the relevant SCA statutory text, (“an individual engaged in commercial fishing for smooth dogfish (Mustelus canis)”) included descriptive language such as “engaged in” and “for” that NMFS understood to be more limiting than if the statute had simply said “while fishing.” We thus interpreted “fishing for smooth dogfish” to limit the exception to those fishing primarily for smooth dogfish, as reflected by the 75 percent retention requirement. Had Congress intended to allow all trips to remove smooth dogfish fins at sea, this qualifying language and emphasis on fishing “for” smooth dogfish would not have been included. As explained in the previous response, the final rule's lower percentage requirement for smooth dogfish catch composition (25 percent v. 75 percent) should address some of the concerns about the practicality of the proposed rule's catch composition requirements in light of the very mixed nature of the fishery, while still ensuring that the exception is limited to those fishing “for” smooth dogfish.

Comment 6: NMFS received comments, including from the SAFMC, MAFMC, NCDMR, and the States of New Jersey and Maryland opposing the “no other sharks on board” provision. The commenters stated that this provision would be burdensome for fishermen and would lead to unnecessary waste and discards of other valuable shark species since it is a mixed, variable fishery. Others noted that NMFS is interpreting the smooth dogfish-specific provisions of the SCA incorrectly because “no other sharks on board” is never mentioned in the statute and that it is inconsistent with ASMFC requirements. Additionally, NMFS received comments stating that a large number of common thresher sharks are often caught with smooth dogfish and if these species had to be discarded, this would be wasteful and could lead to economic impacts to shark fishermen.

Response: After considering public comment, NMFS has determined that it is more appropriate and consistent with the SCA to implement Sub-Alternative A2-1e, which allows other sharks to be retained when removing smooth dogfish fins at seas, provided those sharks are maintained in a condition where the fins and tail remain naturally attached to the carcass through landing. This measure is included in the new sub-alternative based on public comment and additional analyses, and in recognition that a prohibition on having other sharks on board would likely increase regulatory discards, contrary to National Standard 9. The smooth dogfish fishery is more mixed than previously thought, and other sharks, particularly spiny dogfish and common thresher sharks, make up a portion of the catch and contribute considerable revenue to fishermen participating in the smooth dogfish fishery. Under the new preferred sub-alternative, fishermen would not have to choose whether to land smooth dogfish with the fins removed or another species of shark. This is a change from the proposed rule, which would have prohibited retention of other sharks when removing the fins from smooth dogfish at sea. As proposed, a fisherman who wanted to remove fins of smooth dogfish at sea would have had to discard all non-smooth dogfish sharks even if they were dead and were otherwise legal to retain based on species, size, and permits. Alternatively, as proposed, a fisherman could decide to retain non-smooth dogfish sharks and discard any smooth dogfish carcasses and fins that had already been processed. In either situation, as proposed, dead discards would likely increase, given the mixed catches in the smooth dogfish fishery.

Allowing other sharks onboard is consistent with the objective of Amendment 9 to narrowly focus the at-sea fin removal allowance for the smooth dogfish fishery and would not undermine the enforcement of the limited smooth dogfish exception or impact the conservation of non-smooth dogfish sharks because smooth dogfish carcasses can be readily differentiated from other non-smoothhound shark carcasses by the presence of a pre-dorsal ridge. As a practical matter, smooth dogfish and other smoothhound species are indistinguishable in the field. But geographically, smooth dogfish largely are the only smoothhound species found in the Atlantic, which is the only place where smooth dogfish fins can be removed, thus largely alleviating that identification concern. Under the new preferred sub-alternative, other sharks would be allowed on board while removing smooth dogfish fins at sea as long as the fins of non-smooth dogfish sharks remain naturally attached through offloading as currently required. NMFS will monitor all shark catches and discards and dead discards to ensure the conservation of all shark species and will take the additional action, as necessary, to address any conservation or management issues that may arise.

Comment 7: NMFS received several comments, including from the MAFMC and the States of New Jersey and Maryland, supporting the preferred Sub-Alternative A2-2b to require any state commercial fishing permit appropriate for the retention of smoothhound sharks when removing smooth dogfish fins at sea. Some of these comments noted the non-preferred sub-alternative, which would require a smoothhound-specific state commercial fishing permit, could require new regulations and may necessitate cost recovery of permit administration.

Response: NMFS agrees that requiring a smoothhound-specific state fishing permit could be burdensome to states and fishermen. In the Draft EA and proposed rule, NMFS asked for comment on this issue, particularly from the states that would need to develop and administer a smoothhound-specific permit. The states that commented on this issue were unanimously opposed to a smoothhound-specific permit and favored the preferred Sub-Alternative A2-2b. For these reasons, NMFS will implement Sub-Alternative A2-2b as proposed.

Comment 8: NMFS received comments, including from the MAFMC and the State of Florida, in support of the preferred Sub-Alternative A2-3b to apply the exception for smooth dogfish along the Atlantic Coast and not to Florida's coast in the Gulf of Mexico. Conversely, NMFS also received a comment stating that the exception should be applicable in the Gulf of Mexico so that the historical boundaries between the Gulf and South Atlantic Councils are honored and the State of Florida can manage the fishery in a balanced way.

Response: As a practical matter, smooth dogfish and other smoothhound species are indistinguishable in the field. The best available scientific information indicates that smooth dogfish are the predominant smoothhound shark species along the Atlantic coast (only a handful of Florida smoothhound have ever been recorded in the Atlantic and those have been near southern Florida). In the Gulf of Mexico, however, there are at least three different smoothhound species, with no practical way to readily distinguish among them. By limiting the exception to the Atlantic region, as specified at § 635.27(b)(1), this sub-alternative will ensure that the exception only applies where the population is almost entirely smooth dogfish, reducing identification problems and inadvertent finning violations. Furthermore, the State of Florida found the preferred sub-alternative limiting the exception to the Atlantic to be consistent with the Florida Coastal Management Program.

Comment 9: Multiple commenters, including the SAFMC, the States of Maryland, New Jersey, Georgia, and the Commonwealth of Virginia, suggested that none of the landings-based methodologies should be used to establish a smoothhound shark quota. Instead, NMFS should base the quota on the SEDAR 39 smoothhound shark stock assessment that was underway at that time, and which was proposed as an alternative, although the results had not yet been finalized at the time of proposed rule publication. NMFS also received comments opposing the preferred alternative B3, establishing a smoothhound quota equal to the maximum annual landings from 2004-2013 plus two standard deviations because some commenters thought this quota was too high and seemed contrary to a risk averse approach.

Response: NMFS agrees that it is preferable to establish scientifically-based quotas using results from the SEDAR 39 stock assessments. Since publication of the proposed rule, the SEDAR 39 stock assessments have been completed. Based on the availability of the stock assessment results and public comments, NMFS no longer prefers the alternative to establish a landings-based quota and now is basing the quotas on the results of the stock assessments. Thus, NMFS is establishing a smoothhound shark TAC of 1,430.6 mt dw and a commercial quota of 1,201.7 mt dw in the Atlantic region, and a TAC of 509.6 mt dw and commercial quota of 336.4 mt dw in the Gulf of Mexico region, based on results of SEDAR 39. Section 2 of the Final EA provides a summary of the calculations used to determine these quotas.

Comment 10: NMFS received a comment asking NMFS not to wait until the stock assessment was completed and to implement Alternative B1, the smoothhound quota of 715.5 mt dw established in Amendment 3 to the 2006 Consolidated HMS FMP.

Response: NMFS recognizes the benefits of establishing a quota to limit mortality in the commercial fisheries. However, based on the timing of both this action and the SEDAR 39 stock assessments, NMFS determined that establishing scientifically-based quotas using results of the stock assessments outweigh benefits of implementing a landings-based quota. Since the stock assessments are now available, NMFS is establishing quotas based on those stock assessments.

Comment 11: NMFS received support for the preferred alternative C4 to establish a 24-hour soak time limit for sink gillnets and a 0.5 to 2 hour net check requirement for drift gillnet gear. The MAFMC and State of New Jersey also expressed support for the preferred alternative but asked that the definitions of sink and drift gillnets be clarified so that a sink gillnet cannot be mistaken for a net that is drifting in the water column. The State of Maryland expressed support for alternative C3 (24-hour soak time for smoothhound permit holders) stating that net checks are not enforceable. NMFS also received comments suggesting that gillnet fishermen should be required to do both net checks and limit soak time to 24 hours. Other commenters asked NMFS to consider a reduced soak time because they felt that 24 hours was too long and would not reduce the risk of large whale interactions.

Response: NMFS agrees that a 24-hour soak time limit for sink gillnets and a 0.5 to 2 hour net check requirement for drift gillnet gear are appropriate ways to implement the Term and Condition 4 of the 2012 Shark BiOp. NMFS also agrees that the definitions of sink and drift gillnet need to be clear so as not to confuse fishery participants and enforcement officials. As detailed in the Final EA, most smoothhound shark gillnet fishermen will be required to limit soak times to 24 hours since they primarily use sink gillnet gear. This requirement will not significantly change smoothhound shark fishing practices. With regard to other Atlantic shark fishermen, fishermen who use sink gillnet gear will be required to limit soak times to 24 hours and those that use drift gillnets will be required to perform net checks at least every 2 hours. Currently, all Atlantic shark fishermen that use gillnet gear to fish for or who are in possession of any large coastal, small coastal, or pelagic shark, regardless of gillnet type, are required to perform net checks at least every 2 hours (see § 635.21(e)(3)(v)). During the net checks, fishermen are required to look for and remove any sea turtles, marine mammals, or smalltooth sawfish. In the 2012 Shark BiOp, the requirement to use either net checks or the 24-hour set limitation was determined to ensure that any incidentally taken ESA-listed species are detected and released in a timely manner, reducing the likelihood of mortality. As such, NMFS has determined that this alternative will likely have short and long-term minor beneficial ecological impacts on protected resources because it will implement one of the Terms and Conditions of the 2012 Shark BiOp to minimize impacts on protected resources. Because this alternative complies with the 2012 Shark BiOp, has beneficial ecological impacts to protected species, and allows all smoothhound shark gillnet fishermen to continue current fishing practices, NMFS will implement soak time limits for sink gillnets and net checks for drift gillnets, as proposed, in the final rule.

Comment 12: NMFS received a comment stating that NMFS has not received authorization of the incidental take of endangered large whales that may result due to the operation of the fishery. The comment stated that without incidental take of endangered whales authorized under both the MMPA and ESA, federal management violates those laws. The commenter stated that NMFS must acquire take authorization under the MMPA section 101(a)(5)(E) for the expected whale takes associated with the smoothhound fishery and that NMFS must delay Amendment 9 until completion of a negligible impact analysis for North Atlantic right whale, humpback whale and fin whale. NMFS also received comments stating that (1) since the completion of the BiOp, critical habitat has been designated for loggerhead sea turtles, which triggers the requirement to reinitiate consultation in the shark fishery, and (2) the Draft EA fails to discuss effects of the fishery on loggerhead critical habitat.

Response: As required by section 7(a)(2) of the ESA, the HMS Management Division of NMFS Office of Sustainable Fisheries consulted with the NMFS Protected Resources Division (PRD) over proposed Atlantic shark fishery management measures in December 2009. That consultation was completed in 2012, and the Shark BiOp was issued in December 2012. The Biological Opinion concluded that the actions as proposed—including the operation of the smoothhound fishery—were not likely to jeopardize the continued existence of Atlantic sturgeon, smalltooth sawfish or any species of ESA-listed large whales or sea turtles.

Section 9 and regulations implementing section 4(d) of the ESA prohibit the “take” or incidental take of listed species without an exemption. Under the terms of Section 7(b)(4) and Section 7(o)(2), otherwise prohibited take that is incidental to and not intended as part of the agency action may be permitted if it complies with reasonable and prudent measures (RPMs) and terms and conditions of an incidental take statement (ITS). Two RPMs were included in the 2012 Shark BiOp to minimize the effects of the action on sea turtles, smalltooth sawfish, and Atlantic sturgeon by the smoothhound and Atlantic shark fisheries and to monitor the level of incidental take: (1) Minimize the Potential Effects to Sea Turtles, Smalltooth Sawfish, Atlantic Sturgeon and Marine Mammals, and (2) Monitor the Frequency and Magnitude of Incidental Take. One remaining term and condition will be implemented in this final rule and will require gillnet fishermen to conduct net checks and limit gillnet soak times mitigating or reducing interactions with protected species.

Since finalizing the 2012 BiOp, NMFS issued a final determination to list four separate DPSs of the scalloped hammerhead shark (Sphyrna lewini) under the ESA (79 FR 38214, July 3, 2014). The DPSs are Central and Southwest Atlantic, Indo-West Pacific, Eastern Atlantic, and Eastern Pacific. The Eastern Atlantic and Eastern Pacific DPSs are listed as endangered, and the Central and Southwest Atlantic and the Indo-West Pacific DPSs are listed as threatened. NMFS determined that each of the DPSs was significant and distinct based on genetic, behavioral, and physical factors, and in some cases, differences in the control of exploitation of the species across international boundaries. On August 27, 2014, NMFS published a final rule to list the following 20 coral species as threatened: Five in the Caribbean, including Florida and the Gulf of Mexico (Dendrogyra cylindrus, Orbicella annularis, Orbicella faveolata, Orbicella franksi, and Mycetophyllia ferox); and 15 in the Indo-Pacific (Acropora globiceps, Acropora jacquelineae, Acropora lokani, Acropora pharaonis, Acropora retusa, Acropora rudis, Acropora speciosa, Acropora tenella, Anacropora spinosa, Euphyllia paradivisa, Isopora crateriformis, Montipora australiensis, Pavona diffluens, Porites napopora, and Seriatopora aculeata). Two Caribbean species currently listed as threatened (Acropora cervicornis and Acropora palmata) still warranted listing as threatened. The Central and Southwest Atlantic DPS of scalloped hammerhead shark and the seven Caribbean species of coral occur within the boundary of Atlantic HMS commercial and recreational fisheries.

On October 30, 2014, based on the new listings, NMFS requested re-initiation of ESA section 7 consultation on the continued operation and use of HMS gear types (bandit gear, bottom longline, buoy gear, handline, and rod and reel) and associated fisheries management actions in the 2006 Consolidated Atlantic HMS FMP and its amendments. NMFS has preliminarily determined that the ongoing operation of the fisheries is consistent with existing biological opinions and is not likely to jeopardize the continued existence of the Central and Southwest DPS of scalloped hammerhead sharks or the threatened coral species or result in an irreversible or irretrievable commitment of resources which would foreclose formulation or implementation of any reasonable and prudent alternative measures for these species.

Regarding marine mammals, the final 2014 MMPA List of Fisheries classified the southeastern Atlantic shark gillnet fishery as Category II (occasional serious injuries and mortalities). The southeastern Mid-Atlantic and Gulf of Mexico shark BLL shark fishery is classified as Category III (remote likelihood or no known serious injuries or mortalities). Commercial passenger fishing vessel (charter/headboat) fisheries are subject to Section 118 and are listed as a Category III fishery. This action would not significantly increase fishing effort rates, levels, or locations or fishing mortality. The preferred alternatives would not increase effort because the smoothhound quotas are based on the most recent smoothhound shark stock assessments (SEDAR 39). In addition, final management measures are not expected to alter interactions with protected species.

Comment 13: NMFS received support for the preferred alternative of requiring directed shark permit holders with gillnet gear on board to use VMS only in the Southeast U.S. Monitoring Area, including from the States of North Carolina, New Jersey, and Maryland, and the MAFMC. NMFS also received comments preferring the status quo stating that VMS should be required regardless of where the vessel is fishing.

Response: Currently, under Federal HMS regulations, Atlantic shark gillnet fishermen are required to use VMS at certain times of the year regardless of where they are fishing. However, per 50 CFR 229.32(h)(2)(i), the implementing regulations for the Atlantic Large Whale Take Reduction Plan (ALWTRP), Atlantic shark gillnet fishermen are only required to have VMS if they are fishing in the Southeast U.S. Monitoring Area. Because NMFS has determined that VMS is not necessary for Atlantic shark gillnet fishermen in the other ALWTRP restricted areas through the implementation of the ALWTRP regulations, NMFS believes it is best to maintain consistency with these regulations. Maintaining consistency between the Atlantic HMS and ALWTRP regulations will reduce confusion, help fishermen comply with these regulations more easily, and will avoid unnecessary economic burdens on shark fishery participants.

Comment 14: NMFS received a comment stating that smoothhound sharks should be managed by the Regional Fishery Management Councils in cooperation with ASMFC.

Response: As detailed in Amendment 3 to the 2006 Consolidated Atlantic HMS FMP, smoothhound sharks are “oceanic sharks” as defined by the Magnuson-Stevens Act and are subject to management by the Secretary of Commerce under that Act. Please refer to Amendment 3 to the 2006 Consolidated Atlantic HMS FMP for a detailed explanation of why smoothhound sharks are appropriately subject to Federal management.

Comment 15: NMFS received a comment stating that the Federal smoothhound permit could trigger an increase in directed smooth dogfish effort. A comment was also received suggesting that the fishery, once permitted, should not be open access and that a control date should be set to discourage new entrants.

Response: Based on the nature of the fishery, which is labor-intensive and high-volume, additional management burdens such as permit requirements are unlikely to result in an increase in effort. In fact, a slight reduction is more likely. Since effort increases are not expected, NMFS does not believe that introducing a limited access permit in this fishery is necessary at this time. Nevertheless, this action will implement scientifically-based quotas and landings will be closely monitored to ensure that total mortality does not exceed scientifically-determined limits. If, in fact, directed smooth dogfish effort increases, protections will be in place to ensure that fishing pressure does not exceed sustainable levels while NMFS considers if additional measures are necessary.

Comment 16: NMFS received a comment from the State of Maryland stating that they are concerned about the measure to close the fishery when 80 percent of the smoothhound quota has been caught. They feel that this measure may limit access to some states later in the year. The State of Maryland recommends working with the other Atlantic states to close each state's smoothhound fishery once 80 percent of the state's allocation has been harvested.

Response: In all quota-managed Atlantic shark fisheries, NMFS closes the applicable fishery when landings reach, or are expected to reach, 80 percent of the quota. This measure mitigates for possible late reporting, which could result in quota overharvests. Based on the success of this measure in the other shark fisheries, NMFS prefers to implement the 80-percent accountability measure (AM) in the smoothhound shark fisheries as finalized in Amendment 3 to the 2006 Consolidated HMS FMP rather than risk exceeding the quotas in the smoothhound fisheries.

Through Addendum II to the Coastal Sharks Interstate FMP, the ASMFC instituted state shares of the Federal smoothhound shark quota. Although this system was finalized in May 2013 before the Federal smoothhound shark quota was effective, Addendum II proactively divided the quota among several of the Atlantic states in an amount that would total 100 percent of the Federal quota. This agreement among the Atlantic states to limit each state's harvest does not impact nor influence the Federal quota. Although NMFS recognizes that closing the fishery when landings reach, or are expected to reach, 80 percent of the quota could prevent some states from harvesting their full state share of the quota per the ASMFC plan, the measure is an important and effective way to ensure that the sustainability of the smoothhound shark fishery is not jeopardized by overharvests.

Comment 17: NMFS received a comment stating that NMFS should not implement the smoothhound retention allowance from the 2011 HMS Trawl Rule because the increased retention will lead to increased fishing mortality and this mortality will not be adequately quantified and counted against the quota. There are no reporting requirements with open access permits and fisheries tend to underreport incidental catches.

Response: Since January 1, 2013, all commercial landings of Atlantic HMS, regardless of gear type or permit, are required to be reported on a weekly basis. Through these weekly reports, NMFS monitors commercial landings of Atlantic HMS, which will include smoothhound sharks upon implementation of this action. Trawl gear and open access permits do not present unique reporting concerns. Allowing smoothhound sharks to be landed by fishermen who use trawl gear or possess an open access permit does not raise unique concerns about the sustainability of the fishery.

Comment 18: NMFS received comments that Amendment 9 is too narrowly focused on smoothhound sharks and should instead consider all species managed under the 2006 Consolidated HMS FMP. The commenter asserts that a multispecies management approach is preferable. Furthermore, the commenter noted that NMFS' decision to include all HMS in a single, consolidated FMP effectively categorizes all HMS fisheries as a single “fishery.” Thus, all National Standards (NS) under the Magnuson-Stevens Act must be considered in the context of all HMS, not just smoothhound sharks and Atlantic sharks. Specifically, the commenter suggested that NS 3 (“To the extent practicable, an individual stock of fish shall be managed as a unit throughout its range, and interrelated stocks of fish shall be managed as a unit or in close coordination”) requires NMFS to optimize access and management of all HMS, not just smoothhound sharks and Atlantic sharks. Additionally, the commenter felt that NS 1, which mandates achieving optimum yield from each fishery, should be applied across all HMS since all HMS should be categorized as one single fishery.

Response: While a multispecies management approach is advantageous in some instances, NMFS disagrees that Amendment 9 should broadly consider all HMS (including tunas, billfish, and swordfish) as a single fishery. In 2006, NMFS merged all Atlantic HMS management into a single, consolidated FMP. In the 2006 Consolidated Atlantic HMS FMP, NMFS noted that the interrelated nature of HMS fisheries and the need to consider management actions together necessitated merging the two existing HMS FMPs into one FMP. In addition, NMFS identified some adverse ramifications stemming from separation of the plans, including unnecessary administrative redundancy and complexity, loss of efficiency, and public confusion over the management process. It is important to note that NMFS consolidated management of all HMS under one FMP because of the interrelated nature of some of the fisheries and to streamline administration, not because all HMS constitute a single fishery. As appropriate, NMFS analyzes the impacts of management actions for each HMS fishery and optimizes management for all affected HMS fisheries. The Environmental Assessment appropriately considers any effects on the environment, including effects on other fish stocks or fisheries that may result from the actions in Amendment 9. The analyses show that the actions considered in Amendment 9 are unlikely to affect non-smoothhound shark fisheries or Atlantic shark fisheries. The management objectives are narrowly focused on smoothhound sharks, smooth dogfish, and/or Atlantic sharks caught in gillnet gear, the predominant gear type used in the directed smoothhound shark fishery. None of the fisheries considered in this action are likely to encounter other non-smoothhound shark or Atlantic shark in large numbers. Billfish, swordfish, tunas, and pelagic sharks are unlikely to co-occur with the smoothhound sharks nor can swordfish or tunas be retained if caught in gillnet gear. The one exception is the measure to establish an effective date for the 2011 HMS Trawl Rule. Trawl gear does have the potential to interact with a variety of HMS, including smoothhound sharks, Atlantic sharks, and swordfish. The 2011 HMS Trawl rule, recognizing the potential interaction between trawl gear and some HMS, considered an allowance for the limited retention of incidentally caught swordfish and smoothhound sharks. As such, that action considered impacts and explicitly optimized access to affected HMS. With respect to consistency with NS 1 and 3, each HMS management action considers all National Standards in the context of the affected HMS. For detailed information about Amendment 9's consistency with National Standards, please see Section 10 of the Final EA.

NMFS made several changes from the proposed rule, as described below.

1. Catch Composition and “No Other Sharks” Requirements for Removing Smooth Dogfish Fins at Sea (§ 635.30(c)(5)(iii)). The SCA has provisions related to the removal of smooth dogfish fins while at sea that apply when an individual is fishing “for” smooth dogfish. Thus, the proposed rule considered sub-alternatives to apply the exception only to those fishing with the object of commercially harvesting smooth dogfish by focusing on catch composition. This final rule is not implementing the preferred catch composition sub-alternative (75 percent of retained catch must be smooth dogfish), but another sub-alternative (25 percent smooth dogfish) that had been discussed in the proposed rule and analyzed in the draft EA.

NMFS received numerous public comments that the 75 percent catch composition requirement did not adequately reflect the mixed nature of the smooth dogfish fishery and would lead to excessive dead discards. Based on this public comment, NMFS reconsidered the 75 percent smooth dogfish requirement, and determined that it does not properly reflect fishing “for” smooth dogfish. According to public comment, fishermen that fish for smooth dogfish often encounter and retain other species of fish. NMFS verified this by evaluating data from vessel trip reports (VTR). On trips that landed smooth dogfish caught in sink gillnet gear between 2003 and 2014, smooth dogfish only made up 36 percent of the total retained catch while other species such as croaker, bluefish, monkfish, and spiny dogfish made up the remainder. See Final EA at Section 3.4.1 for further detail. If NMFS retained the 75 percent requirement, then this could result in dead discards as well as lost revenues from those species. The 25 percent requirement adopted in the final rule better reflects fishing “for” smooth dogfish, and is within the range of alternatives considered and analyzed in the proposed rule.

Related to the catch composition change and concern about discards, this final rule also makes a change from the proposed rule by allowing retention of other shark species provided that their fins remain naturally attached to the carcass through offloading. This measure is included based on public comment and additional analyses and recognizing that a prohibition on having other sharks on board would likely increase regulatory discards. Specifically, additional analyses indicate that the smooth dogfish fishery is more mixed than previously thought, and that other sharks, particularly spiny dogfish and common thresher sharks, make up a portion of the catch and revenue for fishermen also fishing for smooth dogfish. Given that fishermen process smooth dogfish as they are brought on board, including removing the fins where allowable, the proposed rule approach would have forced fishermen to choose whether to land smooth dogfish with the fins removed (and discard the other species) or land the other species of shark with the fins attached and discard the smooth dogfish with their fins removed at sea. As proposed, a fisherman who wanted to remove smooth dogfish fins at sea would not have been able to retain non-smooth dogfish sharks even if those sharks were dead and otherwise legally retainable based on species, size, and permits. In either situation, as proposed, dead discards would likely have increased given the mixed catches in the smooth dogfish fishery. Thus, other sharks will be allowed on board when smooth dogfish fins have been removed at sea as long as the fins of the non-smooth dogfish sharks remain naturally attached through offloading, as is currently required.

Allowing other sharks on board should not raise enforcement concerns or impact the conservation of non-smooth dogfish sharks because smooth dogfish carcasses can be readily differentiated from other shark carcasses by the presence of a pre-dorsal ridge. While other “ridgeback sharks” have an interdorsal ridge, smooth dogfish are the only shark species in the Atlantic that have a pre-dorsal ridge. We will work with the Office of Law Enforcement to ensure that they are aware of this identifying feature and will update outreach information for shark identification including relevant workshops as appropriate to make permitted shark fishermen and dealers aware of the distinction. NMFS will also continue to monitor all shark catches and discards and take additional action, if necessary to address non-compliance.

The changes in this final rule are consistent with the conservation and management objectives of the Magnuson-Stevens Act and Amendment 9 and the SCA. These changes will not impact the conservation of smooth dogfish or other sharks because landings of these species, regardless of catch composition percentage, will be capped at or under the commercial quota through AMs and/or closures. These changes thus will not have an effect on the status of these stocks, nor are other adverse environmental impacts anticipated. They will also provide for a flexible, profitable, and sustainable smooth dogfish fishery.

2. Atlantic and Gulf of Mexico Regional Commercial Smoothhound Shark Quotas (§ 635.27(b)(1)(xi)). NMFS proposed a smoothhound shark quota equal to the maximum annual landings from 2004-2013 plus two standard deviations (1,739.9 mt dw) using commercial landings data in the absence of a stock assessment and methodology outlined in Amendment 3. At that time, NMFS anticipated that the SEDAR 39 stock assessment for smoothhound sharks would be completed in 2014. Consequently, the proposed rule discussed, and the draft EA analyzed, a quota alternative that would “implement a TAC and smoothhound shark quota(s) consistent with the results of the 2014 smoothhound shark stock assessment if the results become available before publication of the final rule for this action.” (See Alternative B4 in the Draft EA for Amendment 9). The proposed rule also stated that “[t]he 2014 smoothhound shark stock assessment could separate one or more of the stocks into regional stocks between the Atlantic and Gulf of Mexico,” and that for the purposes of the environmental analyses, “NMFS assumes one overarching quota but these alternatives and analyses could apply to multiple regions as well.”

During the public comment period on the proposed rule and draft EA, commenters expressed concern about implementing a smoothhound shark commercial quota based on historical landings, and requested that NMFS wait for SEDAR 39 to be completed. Based on these comments, in this final rule, NMFS is implementing region-specific commercial quotas based on SEDAR 39. Specifically, this final rule establishes an overall TAC of 1,940.2 mt implemented as follows: An Atlantic regional smoothhound shark TAC of 1,430.6 mt dw with a commercial quota of 1,201.7 mt dw, and a Gulf of Mexico regional smoothhound shark TAC of 509.6 mt dw with a commercial quota of 336.4 mt dw. Although the TAC identified in the final rule is inclusive of sources of mortality other than a commercial quota (which is thus necessarily less than the TAC), the overall TAC in the final rule is only 201 mt more than the 1,739.9 mt dw commercial quota from the proposed rule. Thus, establishing a TAC of this level does not raise concerns about requiring additional environmental analyses or additional regulatory action, which may have been the case if the stock assessment had identified a significantly greater allowable TAC (and resultant commercial quota) than those anticipated and analyzed in the proposed rule. The proposed rule presented and analyzed an alternative that anticipated the stock assessment would determine that “the commercial smoothhound shark quota should be set at approximately equal to or greater than 1,739.9 mt dw.” As acknowledged in the EA, even with a higher quota, effort is likely to remain the same relative to current effort. Thus the ecological, economic and social impacts of quota establishing a quota greater than 1,739.9 mt would be within the range analyzed in the Draft EA. In the final rule, the combined regional commercial quotas (1,538.1 mt) are twelve percent less than the original proposed overall quota (1,739.9 mt) but higher than recent annual commercial landings. Both the commercial quotas and the overall TAC in this final rule are within the range of actions considered in the proposed rule and analyzed in the draft EA.

With regard to the regional quota approach, in the Draft EA, NMFS acknowledged that the stock could be split between two regions based on the SEDAR 39 stock assessments and that the analyses performed for one over-arching quota could apply to multiple regions. Based on information supplied during the Data Workshop for SEDAR 39, including tagging data, the stock assessment scientists decided to split smoothhound sharks into two regional stocks, with smooth dogfish in the Atlantic and smooth dogfish, Florida smoothhound, and Gulf smoothhound in the Gulf of Mexico. This regional split, however, does not affect the impact analyses detailed in the Draft EA under Alternative B4, scenario 4. As noted in Section 3.4 of the Draft EA and as confirmed in the SEDAR 39 stock assessments, the smoothhound shark fishery primarily occurs in the Mid-Atlantic region and is composed entirely of smooth dogfish catch. In the Gulf of Mexico region, only a very small, negligible, number of commercial landings occur and there is no commercial fishery. Thus, the Draft EA Alternative B4 quota analyses were informed entirely by data from the Atlantic region including catch location, price data, landings data, and fishery operations. If NMFS applied the single over-arching quota analyses to regional smoothhound shark quotas at the Draft stage, there would have been no information available for the Gulf of Mexico and, with no commercial fishery in that region, a finding of neutral impact. In the Atlantic region where the fishery is located, all impacts detailed in the Draft EA would apply because all data, including catch location, price data, landings data, and fishery operations, came from the Atlantic. Furthermore, the Atlantic smoothhound shark stock assessment would not have resulted in any new impacts because the assessment found current harvest levels and effort are sustainable with no changes required. In summary, the impact analyses detailed in the Draft EA under Alternative B4, scenario 4 are equally applicable to two regional quotas as to one over-arching quota. The changes in this final rule are consistent with the conservation and management objectives of the Magnuson-Stevens Act and Amendment 9 and based on the best scientific information available. Implementing TACs based on the stock assessment results would ensure continued sustainable harvest of smoothhound sharks in the Atlantic and Gulf of Mexico regions and increase the likelihood of maintaining healthy smoothhound shark stocks in both regions.

3. Administrative changes (§§ 635.2, 635.7(g)). NMFS is making minor clarifications to the drift and sink gillnet definitions at § 635.2 to indicate that drift gillnets typically are “floating” in the water column and that sink gillnets are fished on or near the “ocean” bottom and can have weights “and/or” anchors. Additionally, NMFS is changing the administrative processes by which vessels are selected for at-sea observer coverage at § 635.7(g). The changes were made, in part, based on consultation with the Northeast and Southeast Observer Programs so that smoothhound shark observer selection is consistent with both programs. The administrative changes to this section should not have any practical effect; rather, they will ensure that the selection processes currently in place may continue.

4. Administrative Additions (§ 635.19(d)). NMFS is adding language to § 635.19(d) to indicate that trawl gear is an authorized gear for the capture and retention of smoothhound sharks subject to the restrictions specified in § 635.24(a)(7). Regulatory text to authorize retention of smoothhound sharks caught in trawl gear was added to other sections of § 635, including § 635.24(a)(7), and was discussed in the proposed rule but was inadvertently omitted from this part of the regulatory text itself. No substantive changes will occur as a result.

Pursuant to the measures being implemented in this final rule, the 2016 base quotas for smoothhound sharks in the Atlantic and Gulf of Mexico regions would be 1,201.7 mt dw and 336.4 mt dw, respectively. The fishing season for the smoothhound shark fishery will open on January 1, 2016.

The AA has determined that this final rule is consistent with the 2006 Consolidated Atlantic HMS FMP and its amendments, the Magnuson-Stevens Act, and other applicable law.

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

A Final Regulatory Flexibility Analysis (FRFA) was prepared for this rule. The FRFA incorporates the Initial Regulatory Flexibility Analysis (IRFA), and a summary of the analyses completed to support the action. The full FRFA and analysis of economic and ecological impacts are available from NMFS (see ADDRESSES). A summary of the FRFA follows.

Section 604(a)(1) of the Regulatory Flexibility Act (RFA) requires a succinct statement of the need for and objectives of the rule. Chapter 1 of the Final EA and the final rule fully describe the need for and objectives of this final rule. The purpose of this final rulemaking, consistent with the Magnuson-Stevens Act, the ESA, and the MMPA, and the 2006 Consolidated HMS FMP and its amendments, is to provide for the sustainable management of smoothhound sharks and Atlantic shark species. The management objectives are to achieve the following: Implement the smooth dogfish-specific provisions of the SCA; implement smoothhound shark quotas based on the results of SEDAR 39; implement Term and Condition 4 of the 2012 Shark BiOp related to gillnet impacts on ESA-listed species; and revise Atlantic shark gillnet VMS regulations in compliance with the ALWTRP, per the MMPA.

Section 604(a)(2) of the RFA requires a summary of the significant issues raised by the public comments in response to the IRFA and a summary of the assessment of the Agency of such issues, and a statement of any changes made in the rule as a result of such comments. NMFS received many comments on the proposed rule and the Draft EA during the public comment period. A summary of these comments and the Agency's responses, including changes as a result of public comment, are included above. NMFS did not receive comments specifically on the IRFA.

Section 604(a)(4) of the RFA requires agencies to provide an estimate of the number of small entities to which the rule would apply. The small business size standard for Finfish Fishing is $ 20.5 million, for Shellfish Fishing is $5.5 million, and for Other Marine Fishing is $7.5 million. See 79 FR 33647 (June 24, 2014). Under any of these standards, all Atlantic HMS permit holders subject to this rulemaking would be considered small entities.

NMFS does not have exact numbers on affected commercial fishermen. The smoothhound shark commercial permit has not yet been established, so NMFS does not know how many smoothhound shark fishermen will be impacted. An annual average of 169 vessels reported retaining smooth dogfish through VTR from 2003-2014. This is NMFS' best estimate of affected smoothhound shark fishermen.

Additionally, while the retention of sharks in Federal waters requires one of two limited access commercial shark permits, these permits do not specific gear type, including gillnets. For this reason, NMFS does not know the exact number of affected shark gillnet fishermen. As of May 21, 2015, there are 208 directed shark and 253 incidental shark permit holders. Logbook records indicate that there are usually about 18 Atlantic shark directed permit holders that use gillnet gear in any year. However, the universe of directed permit holders using gillnet gear can change from year to year and could include anyone who holds an Atlantic shark directed permit.

As of May 21, 2015, there are 97 Atlantic shark dealers. These dealers could be affected by these measures to varying degrees. Not all of these dealers purchase smoothhound sharks and those that do are concentrated in the Mid-Atlantic region. NMFS will know more about the number of affected dealers when smoothhound reporting requirements become effective. Similarly, not all of these dealers purchase Atlantic sharks caught with gillnet gear. The number is likely low and is concentrated in Florida and the Gulf of Mexico.

Section 604(a)(5) of the RFA requires Agencies to describe any new reporting, record-keeping and other compliance requirements. The Federal commercial smoothhound shark permit requirement analyzed in Amendment 3 will become effective upon the effective date of this rule. NMFS submitted a PRA change request to The Office of Management and Budget (OMB) to add this permit to the existing HMS permit PRA package (OMB control number 0648-0327). OMB subsequently approved the change request to add the Federal commercial smoothhound shark permit to the HMS permit PRA package in May 2011. In November 2015, NMFS submitted a revision to transfer the previously approved commercial smoothhound shark permit from the HMS permit PRA package (OMB Control Number 0648-0327) to the Southeast Regional Office (SERO) permit PRA package (OMB Control Number 0648-0205). That request is still pending approval. Once OMB approves the request, NMFS will issue a notice in the Federal Register announcing the approval of the information collection requirements and the availability of applications for the commercial smoothhound shark permit. This final rule contains a collection-of-information requirement subject to the Paperwork Reduction Act (PRA) and which has been approved by OMB under OMB Control number 0648-0372. Public reporting burden will be reduced under the modified VMS requirements under this final rule. The burden estimate burden will be reduced by this rule, but the changes will be requested as part of the 2016 extension, at which time the estimate of the burden change will be more accurate.

The RFA requires a description of the steps the Agency has taken to minimize any significant economic impact on small entities consistent with the stated objectives of applicable statutes, including a statement of the factual, policy, and legal reasons for selecting the alternative adopted in the final rule and the reason that each one of the other significant alternatives to the rule considered by the Agency that affect small entities was rejected. These impacts are discussed below and in the FRFA for Amendment 9. Additionally, the RFA (5 U.S.C. 603 (c)(1)-(4)) lists four general categories of “significant” alternatives that could assist an agency in the development of significant alternatives. These categories of alternatives are: Establishment of differing compliance or reporting requirements or timetables that take into account the resources available to small entities; clarification, consolidation, or simplification of compliance and reporting requirements under the rule for such small entities; use of performance rather than design standards; and, exemptions from coverage of the rule for small entities.

In order to meet the objectives of this rule, consistent with Magnuson-Stevens Act and ESA, we cannot exempt small entities or change the reporting requirements only for small entities because all the entities affected are considered small entities. Thus, there are no alternatives discussed that fall under the first and fourth categories described above. NMFS does not know of any performance or design standards that would satisfy the aforementioned objectives of this rulemaking while, concurrently, complying with the Magnuson-Stevens Act. Thus, there are no alternatives considered under the third category. As described below, NMFS analyzed several different alternatives in this rulemaking and provided the rationale for identifying the preferred alternative to achieve the desired objective.

The alternatives considered and analyzed are described below. The FRFA assumes that each vessel will have similar catch and gross revenues to show the relative impact of the final action on vessels.

With regard to the implementation of the SCA, NMFS considered two alternatives. Alternative A1, which would not implement the smooth dogfish-specific provisions of the SCA and would instead implement the fins-attached requirement finalized in Amendment 3, and Alternative A2, which would implement the smooth dogfish-specific provisions of the SCA and has sub-alternatives that address the specific elements of the of the smooth dogfish-specific provisions.

Alternative A1 would not implement the smooth dogfish-specific provisions of the SCA and would require all smooth dogfish to be landed with fins naturally attached. This alternative would change current fishing practices since smooth dogfish caught in the directed and incidental fisheries are fully processed while at sea. As a result, this Alternative A1 would likely lead to reduced landings and a lower ex-vessel price because the product would not be fully processed. This could lead to adverse socioeconomic impacts.

Under Alternative A2, the preferred alternative, an allowance for the removal of smooth dogfish fins at sea would increase efficiency in the smooth dogfish fishery and provide a more highly processed product for fishermen to sell to dealers. Quantifying the financial benefits is difficult because baseline effort and increases in efficiency cannot be calculated, but the benefit would fall somewhere between the two extremes of $0 and $699,364, the ex-vessel value of the entire fishery (Section 3.6.2). Assuming that amount is spread evenly across all 169 vessels per year that retain smooth dogfish (Section 6.1), the benefit to individual vessels would be $4,138. However, vessels and trips retain smooth dogfish in widely varying amounts, thus, this per vessel estimate may not provide an accurate picture of individual revenues.

Supporting entities, such as bait and tackle suppliers, ice suppliers, dealers, and other similar businesses, could experience increased revenue if the efficiency of fin removal at sea results in a higher quality product. However, while supporting businesses would benefit from the increased profitability of the fishery, they do not solely rely on the smooth dogfish fishery. In the long-term, it is likely that changes in the smooth dogfish fishery would not have large impacts on these businesses.

Under Sub-Alternative A2-1a, smooth dogfish could make up any portion of the retained catch on board provided that no other sharks are retained. This sub-alternative would authorize smooth dogfish fishermen to retain any non-shark species of fish while still availing themselves of the at-sea fin removal allowance. Smooth dogfish are often caught incidentally during other fishing operations, thus, this sub-alternative would allow fishermen to maximize the profitability of each trip and allow individual operators the flexibility to make decisions, before the trip and while on the water, as to the retained catch composition that would maximize ex-vessel revenues. Under this alternative, fishermen could remove smooth dogfish fins at sea during any type of trip including those trips that are directing effort on other non-shark species. This alternative would maintain the current practice in the fishery and vessels could continue to have ex-vessel revenues of $699,364 per year across the entire fishery (Section 3.6.2).

Under Sub-Alternative A2-1b, fishermen could avail themselves of the at-sea fin removal allowance only if smooth dogfish comprise 25 percent of the retained catch on board. This sub-alternative would authorize smooth dogfish fishermen to retain some non-shark species of fish while still availing themselves of the at-sea fin removal allowance. This sub-alternative would allow some fishermen to maintain the profitability of each trip and allow individual operators some flexibility to make decisions, before the trip and while on the water, as to the retained catch composition that would increase ex-vessel revenues. This increase in flexibility would be to a lesser extent than Sub-Alternative A2-1a which would not have a catch composition requirement, but greater than the other sub-alternatives that limit the fins-attached exception to higher catch composition percentages. This sub-alternative would decrease total ex-vessel revenues relative to the current level of $699,364 per year (Section 3.6.2).

Under Sub-Alternative A2-1c fishermen could avail themselves of the at-sea fin removal allowance only if smooth dogfish comprise 75 percent of the retained catch on board. This sub-alternative would allow fishermen limited flexibility to maintain the profitability of each trip and would allow fishermen to make decisions, before the trip and while on the water, as to the retained catch composition that would increase ex-vessel revenues. While limited, the flexibility in this alternative would be greater than in sub-alternative A2-1d, which would require smooth dogfish catch composition of 100 percent. Because some fishermen catch smooth dogfish along with other species, this sub-alternative could decrease the number of mixed species trips where fishermen could take advantage of the at-sea fin removal allowance. This sub-alternative would likely decrease total ex-vessel revenues relative to the current level of $699,364 per year.

Sub-Alternative A2-1d would require smooth dogfish to comprise 100 percent of the retained catch on board the vessel in order for fishermen to avail themselves of the at-sea fin removal allowance for smooth dogfish. This sub-alternative would eliminate the ability of mixed trips to take advantage of the at-sea fin removal, and would reduce flexibility in deciding which species to retain on each fishing trip. However, approximately 31 vessels (annual average 2003-2014) on directed smooth dogfish trips often only retain smooth dogfish due to the processing practices in place. Thus, these fishermen would not be impacted by a 100 percent smooth dogfish requirement and would benefit from the ability to remove the smooth dogfish fins at sea. This sub-alternative would likely decrease total ex-vessel revenues relative to the current level of $699,364 per year.

Sub-Alternative A2-1e, the preferred sub-alternative, would, similar to Sub-Alternative A2-1b, allow fishermen to avail themselves of the at-sea fin removal allowance only if smooth dogfish comprise 25 percent of the retained catch on board. However, under Sub-Alternative A2-1e, other sharks could be retained as well, provided they are maintained with the fins naturally attached to the carcass. This sub-alternative would allow some fishermen to maintain the profitability of each trip and allow individual operators some flexibility to make decisions, before the trip and while on the water, as to the retained catch composition that would increase ex-vessel revenues. This increase in flexibility would be to a lesser extent than Sub-Alternative A2-1a, which would not have a catch composition requirement, but greater than the other sub-alternatives that limit the fins-attached exception to higher catch composition percentages. This sub-alternative would decrease total ex-vessel revenues relative to the current level of $699,364 per year (Section 3.6.2).

Sub-Alternative A2-2a would require federal smoothhound permitted fishermen to obtain a smooth dogfish-specific state commercial fishing license in order to be able to remove smooth dogfish fins at sea. The requirement to obtain a smooth dogfish-specific state commercial fishing license may be more difficult for fishermen who are in states that do not have smooth dogfish-specific permits in place. This sub-alternative would result in the increased burden on fishermen to obtain another permit, and depending upon the state, could result in an additional permit charge. Since most permits are valid for one year, fishermen would likely need to renew the permit each year for as long as they wish to retain smooth dogfish and remove the fins while at sea. Because not all states have smooth dogfish-specific permits, NMFS does not prefer this alternative.

Sub-Alternative A2-2b, the preferred alternative, would require fishermen to hold any state commercial fishing permit that allows retention of smooth dogfish. It is likely, however, that most smooth dogfish fishermen already hold this type of state permit and would be unaffected by this requirement. This sub-alternative would likely be the most straightforward for regulatory compliance because the permit requirement would be the simpler than sub-alternative A2-2a. Thus, NMFS prefers this sub-alternative.

NMFS considered two alternatives for Geographic Application of the SCA exception. Under Sub-Alternative A2-3a, the exception would apply along the Atlantic Coast and the Florida west coast in the Gulf of Mexico. As explained earlier, as a practical matter, smooth dogfish and other smoothhound species are indistinguishable, although smoothhound are distinguishable from other ridgeback sharks by the presence of a pre-dorsal ridge. The best available scientific information indicates that smooth dogfish are likely the only smoothhound shark species along the Atlantic coast. In the Gulf of Mexico, however, there are at least three different smoothhound species, with no practical way to distinguish among them. This sub-alternative would apply the smooth dogfish exception 50 nautical miles from the baseline of all the States that fall under the SCA definition of “State.” This sub-alternative could result in other smoothhound sharks indirectly falling under the exception, because they cannot be distinguished from smooth dogfish. NMFS does not expect any impacts because there is no commercial fishery for smooth dogfish in the Gulf of Mexico at this time. However, NMFS does not prefer this sub-alternative because, if a fishery does develop, species misidentification could result in enforcement action.

Under Sub-Alternative 3b, the preferred sub-alternative, the exception would only apply along the Atlantic coast and not the Florida west coast in the Gulf of Mexico. By not extending the exception into the Gulf of Mexico, this sub-alternative would ensure that the SCA's exception to the fins-attached requirements for smooth dogfish would only apply along the Atlantic Coast where the population is almost entirely smooth dogfish, reducing identification problems and inadvertent finning violations. NMFS does not expect any impacts because, at this time, there is no commercial fishery for smooth dogfish in the Gulf of Mexico. NMFS prefers this sub-alternative because it simplifies enforcement and compliance without adverse impacts. This sub-alternative would not affect total ex-vessel revenues relative to the current level of $699,364 per year.

With regard to the smoothhound quota alternatives, NMFS considered four alternatives. Alternative B1, which would implement the smoothhound shark quota finalized in Amendment 3; Alternative B2, which would establish a rolling quota based on the most recent five years of landings data; Alternative B3, which would calculate the smoothhound quota using the same method as in Amendment 3 but would use updated smoothhound landings information; and Alternative B4, which would establish smoothhound shark quotas that reflects the results of the SEDAR 39 smoothhound shark stock assessments.

Alternative B1 would implement the quota finalized in Amendment 3 (715.5 mt dw), which was based on highest annual landings from (1998 to 2007) and adding two standard deviations. Current reported smoothhound shark landings are higher than the quota level in Alternative B1. As such, implementing this quota would prevent fishermen from fishing at current levels, resulting in lost revenues. In 2010 when landings peaked, total smoothhound shark landings totaled 2,688,249 lb dw (ACCSP data) resulting in ex-vessel revenues across the entire smoothhound sink gillnet fishery of $2,458,135 (2,688,249 lb of meat, 322,590 lb of fins). Implementation of the Amendment 3 quota (715.5 mt dw) would result in ex-vessel revenues of only $1,442,367 (1,577,391 lb of meat, 189,287 lb of fins), which is $1,015,768 less than current ex-vessel revenues. Both of these estimates assume $1.62/lb for fins, $0.72/lb for meat, and a 12 percent fin-to-carcass ratio (prices based on 2014 dealer data and fin-to-carcass ratio based on the SCA). Seventy-five percent of all landings in the smoothhound shark fishery come from sink gillnets and there are approximately 77 vessels that use sink gillnet gear to fish for smoothhound sharks in any given year. Assuming an average of 77 sink gillnet vessels fishing for smoothhound sharks, the quota in this alternative would result in annual ex-vessel revenues of $18,732 per vessel which is less than 2010 ex-vessel revenues of $31,923 per vessel. This is an average across all directed and incidental sink gillnet vessels and this individual annual vessel ex-vessel revenue may fluctuate based on the degree to which fishermen direct on smoothhound sharks.

The quota in Alternative B1 does not accurately characterize current reported landings of smoothhound sharks. Vessels that fish for smoothhound sharks likely fished opportunistically on multiple species of coastal migratory fish and elasmobranches, and it is unlikely that any sector within the fishing industry in the Northeast (fisherman, dealer, or processor) relies wholly upon smoothhound sharks. Longer-term impacts are expected to be neutral given the small size of the fishery and the generalist nature of the sink gillnet fishery.

Alternative B2 would establish a rolling smoothhound shark quota set above the maximum annual landings for the preceding five years; this quota would be recalculated annually to account for the most recent landing trends within the smoothhound complex (2016 quota would be 1,729 mt dw based on 2010-2014 data). The 2016 quota under this alternative is likely to result in annual revenues of $3,485,466 (3,811,753 lb of meat, 457,410 lb of fins) assuming an ex-vessel price of $1.62 lb for fins and $0.72 lb for meat. Seventy-five percent of all landings in the smoothhound shark fishery come from sink gillnets and there are approximately 77 vessels that use sink gillnet gear to fish for smoothhound sharks. Assuming an average of 77 sink gillnet vessels fishing for smoothhound sharks, the quota in this alternative would result in individual vessel annual revenues of $45,266 which is more than 2010 ex-vessel revenues of $31,923 per vessel. This is an average across all sink gillnet vessels, regardless of catch levels, and this individual annual vessel revenue may fluctuate based on the degree to which fishermen direct on smoothhound sharks.

Setting the quota above current landings levels should allow the fishery to continue, rather than be closed, allowing for NMFS to collect more information that can be used in future stock assessments. Alternative B2 is consistent with the intent of Amendment 3, which was to minimize changes to the fishery while information on catch and participants was collected. Because landings in the smoothhound shark fishery are likely underreported, it is unclear at this time whether the increase in reported landings is due to existing smoothhound fishermen reporting in anticipation of future management or increased effort (e.g., new entrants into the fishery). While a rolling quota would cover all current reporting and likely cover all underreporting of landings, the fishery could grow exponentially if reported landings continue to increase over consecutive years, possibly resulting in stock declines and in turn a potential loss of revenue to the fishing industry. The rolling quota could also lead to lower quotas in consecutive years if landings decrease over time. Thus, the changing nature of the rolling quota could lead to uncertainty in the fishery and could cause direct and indirect minor adverse socioeconomic impacts in the long term.

Alternative B3 would create a smoothhound quota equal to the maximum annual landings from 2005-2014 plus two standard deviations and would equal 1,733.9 mt dw. This alternative would establish a smoothhound quota two standard deviations above the maximum annual landings reported over the last ten years which is the method used to calculate the smoothhound shark quota that was finalized in Amendment 3. This quota would result in potential annual revenues in the entire fishery of $3,495,345 (3,822,556 lb of meat, 458,707 lb of fins) assuming an ex-vessel price of $1.62 lb for fins and $0.72 for meat. Seventy-five percent of all landings in the smoothhound shark fishery come from sink gillnets and there are approximately 77 vessels that use sink gillnet gear to fish for smoothhound sharks. Assuming an average of 77 sink gillnet vessels fishing for smoothhound sharks, the quota proposed in this alternative would result in individual vessel annual revenues of $45,394. This is an average across all sink gillnet vessels, regardless of catch levels, and this individual annual vessel revenue may fluctuate based on the degree to which fishermen direct on smoothhound sharks.

At the time of publication for the Draft EA, the SEDAR 39 smoothhound stock assessments were underway, but not yet complete. In anticipation that the final stock assessments could be finalized before this final rule, NMFS considered a range of scenarios under Alternative B4 to implement potential results and scenarios, recognizing that results beyond the scope of those analyzed could require additional analysis or regulatory action. The SEDAR 39 stock assessment is now final; thus, the scenarios considered in the Draft EA are no longer appropriate to consider. Rather, NMFS has analyzed the actual results of the stock assessments, which would establish an Atlantic smoothhound commercial quota of 1,201.7 mt dw and a Gulf of Mexico smoothhound shark quota of 336.4 mt dw. These quotas would result in annual revenues of $2,422,251.54 (2,649,006 lb of meat, 317,881 lb fins), assuming an ex-vessel price of $1.62 lb for fins and $0.72 lb for meat. Seventy-five percent of all landings in the smoothhound shark fishery come from sink gillnets and there are approximately 77 vessels that use sink gillnet gear to fish for smoothhound sharks. Assuming an average of 77 sink gillnet vessels fishing for smoothhound sharks, the quota in this alternative would result in individual vessel annual revenues of $31,458. This is an average across all sink gillnet vessels, regardless of catch levels, and this individual annual vessel revenue may fluctuate based on the degree to which fishermen direct on smoothhound sharks. The quotas under Alternative B4 are both consistent with the intent of Amendment 3, which was to minimize changes to the fishery while information on catch and participants was collected, while also implementing science-based quotas to ensure continued sustainable harvest of smoothhound sharks in the Atlantic and Gulf of Mexico regions. NMFS anticipates short-term, direct minor beneficial socioeconomic impacts under this alternative given the combined commercial quotas for the Atlantic and Gulf of Mexico regions under this alternative would result in increased revenues compared to the commercial quota under Alternative B1, though lower than those anticipated under Alternatives B2 or B3. These commercial quotas would allow the fishery to continue at the rate and level observed in recent years into the future without having to be shut down prematurely. Given that the fishery would expect to operate as it currently does, NMFS anticipates in the short term, indirect, minor, positive socioeconomic impacts for shark dealers and processor. Since this alternative establishes scientifically-based quotas and would result in beneficial socioeconomic impacts, NMFS prefers this alternative.

In order to implement TC 4 of the 2012 Shark BiOp in the smoothhound shark fishery, NMFS considered 4 alternatives. The No Action alternative, which would not implement TC 4 of the 2012 Shark BiOp; alternative C2, which would require smoothhound shark fishermen to conduct net checks at least every 2 hours; alternative C3, which would require smoothhound shark fishermen to limit their gillnet soak time to 24 hours and those smoothhound shark fishermen that also have a Atlantic shark limited access permit to check their nets at least every 2 hours; and finally, Alternative C4, which would require smoothhound and Atlantic shark fishermen using sink gillnet to soak their nets no longer than 24 hours and those fishermen using drift gillnets to check their nets at least every 2 hours.

Alternative C1 would not implement the BiOp term and condition that would require all smoothhound shark permit holders to either check their gillnet gear at least every 2.0 hours or limit their soak time to no more than 24 hours. This alternative would likely result in short and long-term neutral direct socioeconomic impacts. Under Alternative C1, smoothhound shark fishermen would continue to fish as they do now and so this alternative would not have economic impacts that differ from the status quo. Similarly, this alternative would likely result in neutral short and long-term indirect socioeconomic impacts since supporting businesses including dealers and bait, tackle, and ice suppliers would not be impacted.

Alternative C2 would require smoothhound shark fishermen using gillnet gear to conduct net checks at least every 2.0 hours to check for and remove any protected species, and would likely result in short and long-term direct moderate adverse socioeconomic impacts. Some smoothhound shark gillnet fishermen fish multiple nets at one time or deploy their net(s), leave the vicinity, and return later. Alternative C2 would require these fishermen to check each gillnet at least once every 2 hours, making fishing with multiple nets or leaving nets unattended difficult. This would likely lead to a reduction in effort and landing levels, resulting in lower ex-vessel revenues. Quantifying the loss of income is difficult without information characterizing the fishery including the number of nets fished. However, limiting the amount of fishing effort in this manner is likely to reduce total landings of smoothhound sharks or, in order to keep landing levels high, extend the length of trips. Landings of incidentally caught fish species could be reduced as well, although under preferred Sub-Alternative A2-1c, smoothhound shark fishermen that wish to remove smooth dogfish fins at sea could not retain other species. This alternative would not have a large impact on supporting businesses such as dealers or bait, tackle, and ice suppliers since these businesses do not solely rely on the smoothhound shark fishery. The smoothhound shark fishery is small relative to other fisheries. Thus, Alternative C2 would likely result in short and long-term indirect neutral socioeconomic impacts. Alternative C2 would impact the approximately 77 vessels that annually catch smoothhound sharks with gillnet gear (annual average from 2003-2014, Table 3.1).

Alternative C3 would establish a gillnet soak time limit of 24 hours for smoothhound shark permit holders. Under this alternative, fishermen holding both an Atlantic shark limited access permit and a smoothhound shark permit must abide by the 24 hour soak time restriction and conduct net checks at least every 2 hours. This alternative would likely result in short- and long-term direct minor adverse socioeconomic impacts to those smoothhound permitted fishermen that also have an Atlantic shark limited access permit and therefore would be required to check their nets at least every 2 hours. Currently, smoothhound shark gillnet fishermen sometimes fish multiple nets or leave nets unattended for short periods of time. Rarely are these nets soaked for more than 24 hours, thus, this alternative would not impact smoothhound shark gillnet fishermen that do not have an Atlantic shark limited access permit. Adverse socioeconomic impacts resulting from this alternative would likely occur to the subset of smoothhound shark fishermen that also hold an Atlantic shark limited access permit. These smoothhound shark fishermen would be at a disadvantage to other smoothhound shark fishermen that do not have an Atlantic shark limited access permit because they would be required to check their gillnets at least every 2 hours which is a large change in the way the smoothhound shark fishery currently operates. Dropping the Atlantic shark permit to avoid the net check requirement is unlikely to be feasible because Atlantic shark permits allow limited access (NMFS is no longer issuing new permits) and cannot be easily obtained. Additionally, pelagic longline fishermen are required to have an incidental or directed shark permit when targeting swordfish or tunas, even if they are not fishing for sharks, due to the likelihood of incidental shark catch. In practical terms, this could result in smoothhound shark gillnet fishermen abiding by the 2 hour net check requirement even if they do not fish for Atlantic sharks and only hold a Atlantic shark limited access permit to fish for swordfish or tunas (note that gillnets cannot be used to target swordfish or tunas, but some vessels may switch gears between trips). For this subset of fishermen, basing gillnet requirements on permit types could introduce fishing inefficiencies when compared to other smoothhound fishermen, likely resulting in adverse socioeconomic impacts to these fishermen. It is unlikely that this alternative would have a large impact on supporting businesses such as dealers or bait, tackle, and ice suppliers since these businesses do not solely rely on the smoothhound shark fishery. The smoothhound shark fishery is small relative to other fisheries. It is difficult to determine the number of fishermen that would be adversely affected because NMFS does not yet know which vessels will obtain a smoothhound shark fishing permit. However, it is likely that this number will be approximately equal to 169 which is the average annual number of vessel that retain smoothhound sharks (Section 3.4).

Alternative C4, the preferred alternative, would establish a soak time limit of 24 hours for fishermen using sink gillnet gear and a 2 hour net check requirement for fishermen using drift gillnet gear in the Atlantic shark and smoothhound shark fisheries. Drift gillnets would be defined as those that are unattached to the ocean bottom with a float line at the surface and sink gillnet gear would be defined as those with a weight line that sinks to the ocean bottom, has a submerged float line, and is designed to be fished on or near the bottom. Alternative C4 would likely result in neutral short and long-term direct socioeconomic impacts. Smoothhound shark fishermen, who typically use sink gillnets, would be required to limit soak times to 24 hours and as discussed above, this requirement is unlikely to significantly alter smoothhound shark fishing practices. Drift gillnet fishermen, who are more likely to target Atlantic sharks rather than smoothhound sharks, would be required to check their nets at least every 2 hours, as is currently required. Thus, this alternative is unlikely to have any socioeconomic impacts to Atlantic shark and smoothhound shark fishermen because it would not change current fishing practices. Similarly, this alternative would likely result in neutral short and long-term indirect socioeconomic impacts because supporting businesses including dealers and bait, tackle, and ice suppliers should not be impacted. Alternative C4 would impact the approximately 77 vessels that annually catch smoothhound sharks with gillnet gear (annual average from 2003-2014, Table 3.1). Because Alternative C4 would have minimal economic impact but is still consistent with the 2012 Shark BiOp, NMFS prefers this alternative.

NMFS also considered two alternatives to streamline the current VMS requirements for Atlantic shark fishermen with gillnet gear on board. The No Action alternative would maintain the current requirement to have VMS on board when fishing for Atlantic sharks with gillnet regardless of where the vessel is fishing and alternative D2 would require VMS on board only for Atlantic shark fishermen using gillnet gear in an area specified by the ALWTRP requirements at 50 CFR 229.32.

Alternative D1 would maintain the current requirement of requiring Atlantic shark permit holders fishing with gillnet gear to have VMS on board, regardless of where the vessel is fishing. These VMS requirements were put in place as an enforcement tool for complying with the ALWTRP requirements set forth in 50 CFR 229.32. Atlantic shark gillnet fishermen are only required to have VMS if they are fishing in the Southeast U.S. Monitoring Area. See 50 CFR 229.32(h)(2)(i). Purchasing and installing a VMS unit costs approximately $3,500, and monthly data transmission charges cost, on average, approximately $44.00. Because these monthly costs are currently incurred whenever a shark gillnet fishermen is fishing, these costs can affect the fishermen's annual revenues. Although the affected fishermen already have VMS installed, they continue to pay for transmission and maintenance costs, and could need to buy a new unit if theirs fails. It is possible that a NMFS VMS reimbursement program could defray part of the purchase cost, but is not certain. Thus, it is likely that this alternative could have short and long-term direct minor adverse socioeconomic impacts to fishermen due to the cost of purchasing and maintaining a VMS unit. While the retention of sharks in federal waters requires one of two limited access commercial shark permits, these permits do not specify gear type, including gillnets. For this reason, NMFS does not know the exact number of affected shark gillnet fishermen. As of October 11, 2014, there are 206 directed shark and 258 incidental shark permit holders. Logbook records indicate that there are usually about 18 Atlantic shark directed permit holders that use gillnet gear in any year. However, the universe of directed permit holders using gillnet gear can change from year to year and could include anyone who holds an Atlantic shark directed permit.

Alternative D2, the preferred alternative, would change the gillnet VMS requirements and would require federal directed shark permit holders with gillnet gear on board to use VMS only in the vicinity of the Southeast U.S. Monitoring Area, pursuant to ALWTRP requirements, and would have short and long-term direct minor beneficial socioeconomic impacts. Atlantic shark gillnet fishermen fishing in the vicinity of the Southeast U.S. Monitoring Area would still incur the installation costs of the VMS, but data transmission would be limited to those times when the vessel is in this area. Furthermore, shark gillnet fishermen outside of this area that do not fish in the vicinity of the Southeast U.S. Monitoring Area would not need to install a VMS unit or, if they already have one, maintain the VMS unit or replace a malfunctioning one. Thus, the socioeconomic impacts from this alternative, while still adverse, are of a lesser degree than those under Alternative D1, the No Action alternative. This alternative would likely result in neutral short and long-term indirect socioeconomic impacts because supporting businesses, including dealers and bait, tackle, and ice suppliers, would not be impacted. While the retention of sharks in federal waters requires one of two limited access commercial shark permits, these permits do not specify gear type, including gillnets. For this reason, NMFS does not know the exact number of shark gillnet fishermen that would be affected by this alternative. As of October 11, 2014, there are 206 directed shark and 258 incidental shark permit holders. Logbook records indicate that there are usually about 18 Atlantic shark directed permit holders that use gillnet gear in any year. However, the universe of directed permit holders using gillnet gear can change from year to year and could include anyone who holds an Atlantic shark directed permit. Because this alternative is more in line with the requirements of the ALWTRP, and because it would reduce socioeconomic impacts while still maintaining beneficial ecological impacts for protected whale species, NMFS prefers this alternative.

This final rule contains a collection-of-information requirement subject to the Paperwork Reduction Act (PRA) and which has been approved by OMB under control number 0648-0372. Public reporting burden will be reduced under the modified VMS requirements under this final rule. The burden estimate burden will be reduced by this rule, but the changes will be requested as part of the 2016 extension, at which time the estimate of the burden change will be more accurate.

Section 212 of the Small Business Regulatory Enforcement Fairness Act of 1996 states that, for each rule or group of related rules for which an agency is required to prepare a FRFA, the agency shall publish one or more guides to assist small entities in complying with the rule, and shall designate such publications as “small entity compliance guides.” The agency shall explain the actions a small entity is required to take to comply with a rule or group of rules. As part of this rulemaking process, a letter to permit holders that also serves as small entity compliance guide (the guide) was prepared. Copies of this final rule are available from the HMS Management Division (see ADDRESSES) and the guide (i.e., permit holder letter) will be sent to all holders of permits for the Atlantic shark and smoothhound shark commercial fisheries. The guide and this final rule will be available upon request.

For reasons set out in the preamble, 50 CFR part 635 is amended as follows: