Federal Register Vol. 80, No.52,

Federal Register Volume 80, Issue 52 (March 18, 2015)

Page Range13995-14290
FR Document

80_FR_52
Current View
Page and SubjectPDF
80 FR 14289 - Providing an Order of Succession Within the Council on Environmental QualityPDF
80 FR 14287 - National Poison Prevention Week, 2015PDF
80 FR 14168 - Finance, Budget & Program Committee Meeting of the Board of Directors Meeting; Sunshine ActPDF
80 FR 14129 - Pesticide Program Dialogue Committee; Extension of Deadline for NominationsPDF
80 FR 14097 - Applications for New Awards; Technical Assistance and Dissemination To Improve Services and Results for Children With Disabilities-Model Demonstration Projects To Improve Adolescent Literacy for Students with Disabilities in Middle and High Schools, Grades 6-12PDF
80 FR 14094 - Foreign-Trade Zone (FTZ) 44-Mount Olive, New Jersey; Notification of Proposed Production Activity, Givaudan Fragrances Corporation, (Fragrance Compounds), Mount Olive, New JerseyPDF
80 FR 14229 - Nineteenth Meeting: RTCA Special Committee 225, Rechargeable Lithium Battery and Battery SystemsPDF
80 FR 14240 - Notice of Request To Release Airport PropertyPDF
80 FR 14154 - Bureau of ReclamationPDF
80 FR 14092 - Export Trade Certificate of ReviewPDF
80 FR 14033 - Radiation ProtectionPDF
80 FR 14168 - Honeywell International, Inc.PDF
80 FR 14158 - Proposed Renewal of Information Collection: OMB Control Number 1090-0011, DOI Generic Clearance for the Collection of Qualitative Feedback on Agency Service DeliveryPDF
80 FR 14152 - Proposed Renewal of Information Collection: 1090-0007, American Customer Satisfaction Index (ACSI) Government Customer Satisfaction SurveysPDF
80 FR 14154 - Proposed Renewal of Information Collection: 1090-0008, E-Government Web Site Customer Satisfaction Surveys (Formerly American Customer Satisfaction Index (ACSI) E-Government Web Site Customer Satisfaction Surveys)PDF
80 FR 14091 - Circular Welded Carbon-Quality Steel Pipe From the People's Republic of China: Rescission of Countervailing Duty Administrative Review; 2013PDF
80 FR 14073 - Takes of Marine Mammals Incidental to Specified Activities; Taking Marine Mammals Incidental to Russian River Estuary Management ActivitiesPDF
80 FR 14244 - Agency Information Collection Activities; Proposals, Submissions, and ApprovalsPDF
80 FR 14166 - NASA Advisory Council; Ad Hoc Task Force on STEM Education; MeetingPDF
80 FR 14166 - Notice of Intent to Grant a Partially Exclusive LicensePDF
80 FR 14150 - Endangered Species Recovery Permit ApplicationsPDF
80 FR 14148 - Proposed Renewal of Information Collection: OMB Control Number 1040-0001, DOI Programmatic Clearance for Customer Satisfaction SurveysPDF
80 FR 14159 - Notice of Public Meeting, Albuquerque District Resource Advisory Council Meeting, New MexicoPDF
80 FR 14024 - 2-Propenoic acid, polymer With ethenyl acetate, ethenylbenzene, 2-ethylhexyl 2-propenoate and ethyl 2-propenoate; Tolerance ExemptionPDF
80 FR 14145 - Notice of Hearing: Reconsideration of Disapproval Louisiana Medicaid State Plan Amendment (SPA) 12-66-BPDF
80 FR 14239 - Prevention of Alcohol Misuse and Prohibited Drug Use in Transit OperationsPDF
80 FR 14030 - General Administrative Regulations; Subpart X-Interpretations of Statutory Provisions, Policy Provisions, and ProceduresPDF
80 FR 14130 - Notification of a Public Meeting of the Science Advisory Board Drinking Water CommitteePDF
80 FR 14041 - Approval and Promulgation of Air Quality Implementation Plans; Maryland; Determination of Attainment of the 2008 8-Hour Ozone National Ambient Air Quality Standard for the Baltimore, Maryland Moderate Nonattainment AreaPDF
80 FR 14072 - Submission for OMB Review; Comment RequestPDF
80 FR 14038 - Approval and Promulgation of Implementation Plans; AlaskaPDF
80 FR 14130 - Meeting of the Environmental Financial Advisory Board-Public NoticePDF
80 FR 14238 - Agency Request for Emergency Processing of Collection of Information by the Office of Management and BudgetPDF
80 FR 14027 - Railworthiness Directive for Railroad Tank Cars Equipped With Certain McKenzie Valve & Machining LLC ValvesPDF
80 FR 14132 - FDIC Advisory Committee on Community Banking; Notice of MeetingPDF
80 FR 14105 - Rockies Express Pipeline LLC: Notice of ApplicationPDF
80 FR 14129 - N.E.W. Hydro, LLC; Notice of Technical MeetingPDF
80 FR 14129 - Texas Eastern Transmission, LP: Notice of Request Under Blanket AuthorizationPDF
80 FR 14127 - Review of Cost Submittals by Other Federal Agencies for Administering Part I of the Federal Power Act; Notice of Technical ConferencePDF
80 FR 14132 - Notice of Agreements FiledPDF
80 FR 14071 - Notice of Public Meeting of the Missouri Advisory Committee for a Meeting To Discuss Matters Related To Its Project on Police-Community Relations in MissouriPDF
80 FR 14094 - Western Pacific Fishery Management Council; Public MeetingsPDF
80 FR 14148 - 30-Day Notice of Proposed Information Collection: Standardized Form for Collecting Information Regarding Race and Ethnic DataPDF
80 FR 14133 - Change in Bank Control Notices; Acquisitions of Shares of a Bank or Bank Holding CompanyPDF
80 FR 14133 - Formations of, Acquisitions by, and Mergers of Savings and Loan Holding CompaniesPDF
80 FR 14133 - Formations of, Acquisitions by, and Mergers of Bank Holding CompaniesPDF
80 FR 14070 - Submission for OMB Review; Comment RequestPDF
80 FR 14096 - Proposed Information Collection; Comment Request; Property ManagementPDF
80 FR 14095 - Proposed Information Collection; Comment Request; Requirements for Approved Construction InvestmentsPDF
80 FR 14072 - Proposed Information Collection; Comment Request; Award Amendment Requests and Project Service MapsPDF
80 FR 14231 - Parts and Accessories Necessary for Safe Operation; Exemption Renewal for Lytx, Inc.PDF
80 FR 14107 - Excess Uranium Management: Effects of DOE Transfers of Excess Uranium on Domestic Uranium Mining, Conversion, and Enrichment Industries; Notice of Issues for Public CommentPDF
80 FR 14167 - Records Schedules; Availability and Request for CommentsPDF
80 FR 14227 - Hours of Service of Drivers: Oregon Trucking Associations' Application for ExemptionPDF
80 FR 14229 - Notice of Applications for Certificates of Public Convenience and Necessity and Foreign Air Carrier Permits Filed Under Subpart B (formerly Subpart Q) During the Week Ending February 28, 2014PDF
80 FR 14034 - Small Business Investment Companies-Early StagePDF
80 FR 14070 - Notice of Meeting of Expert Panel on Federal Statistics on Women and Beginning Farmers in U.S. AgriculturePDF
80 FR 14222 - Parts and Accessories Necessary for Safe Operation; Mobileye, Inc., Application for an ExemptionPDF
80 FR 14223 - Qualification of Drivers; Exemption Applications; VisionPDF
80 FR 14240 - Qualification of Drivers; Exemption Applications; VisionPDF
80 FR 14220 - Qualification of Drivers; Exemption Applications; VisionPDF
80 FR 14229 - Hours of Service of Drivers: Trailways Companies, Application for Renewal of ExemptionPDF
80 FR 14232 - Qualification of Drivers; Exemption Applications; Diabetes MellitusPDF
80 FR 14009 - Safety Zones; Upper Mississippi River Between Mile 38.0 and 46.0, Thebes, IL; and Between Mile 78.0 and 81.0, Grand Tower, IL.PDF
80 FR 14095 - President's Advisory Council on Doing Business in Africa: Meeting of the President's Advisory Council on Doing Business in AfricaPDF
80 FR 14161 - Certain Television Sets, Television Receivers, Television Tuners, and Components Thereof, Capabilities and Components Thereof; Request for Statements on the Public InterestPDF
80 FR 14162 - SMC Electrical Products, Inc., a Subsidiary of Becker Mining America, Inc., Including On-Site Leased Workers From Bristol Computer Services, Kelly Services and Ensin Maintenance Services, Barboursville, West Virginia; Amended Certification Regarding Eligibility To Apply for Worker Adjustment AssistancePDF
80 FR 14160 - Certain Non-Volatile Memory Chips and Products Containing the Same; Commission Determination Not To Review an Initial Determination Terminating the Investigation Based on a Settlement AgreementPDF
80 FR 14162 - Mondi Bags USA, LLC, New Philadelphia Plant, Including Workers Whose Wages Are Reported Under Graphic Packaging Industrial, New Philadelphia, Ohio; Amended Certification Regarding Eligibility To Apply for Worker Adjustment AssistancePDF
80 FR 14162 - Riverside Manufacturing Company Main Sewing Plant Including Workers Whose Wages are Reported Under Affinity Apparel and Including On-Site Leased Workers From Ambassador Personnel Riverside, Georgia; Riverside Manufacturing Company ReComTec Division Including Workers Whose Wages Are Reported Under Affinity Apparel and Including On-Site Leased Workers From Ambassador Personnel Riverside, Georgia; Amended Certification Regarding Eligibility To Apply for Worker Adjustment AssistancePDF
80 FR 14126 - California Clean Power Corp.; Supplemental Notice that Initial Market-Based Rate Filing Includes Request for Blanket Section 204 AuthorizationPDF
80 FR 14103 - Combined Notice of Filings #1PDF
80 FR 14163 - Investigations Regarding Eligibility To Apply for Worker Adjustment AssistancePDF
80 FR 14165 - Notice of Determinations Regarding Eligibility To Apply for Worker Adjustment Assistance and Alternative Trade Adjustment AssistancePDF
80 FR 14164 - Agency Information Collection Activities; Submission for OMB Review; Comment Request; Bloodborne Pathogens StandardPDF
80 FR 14143 - Agency Forms Undergoing Paperwork Reduction Act ReviewPDF
80 FR 14140 - Agency Forms Undergoing Paperwork Reduction Act ReviewPDF
80 FR 14243 - Hazardous Materials Safety ProgramPDF
80 FR 14071 - Notice of Proposed Fee Increase; Federal Lands Recreation Enhancement Act, (Title VIII, Pub. L. 108-447)PDF
80 FR 14172 - Information Collection: Billing Instructions for NRC Cost Type ContractsPDF
80 FR 14062 - Approval and Promulgation of Implementation Plans; State of Missouri, Construction Permits RequiredPDF
80 FR 14131 - Information Collections Being Reviewed by the Federal Communications Commission Under Delegated AuthorityPDF
80 FR 14037 - Clean Air Act Title V Operating Permit Program Revision; PennsylvaniaPDF
80 FR 14066 - Fisheries Off West Coast States; West Coast Salmon Fisheries; Management Reference Point Updates for Three Stocks of Pacific SalmonPDF
80 FR 14044 - Revisions to Air Plan; Arizona; Stationary Sources; New Source ReviewPDF
80 FR 14009 - Boscalid; Pesticide TolerancesPDF
80 FR 14127 - Combined Notice of FilingsPDF
80 FR 14104 - Combined Notice of Filings #1PDF
80 FR 14127 - Combined Notice of Filings #1PDF
80 FR 14103 - South Jersey Energy ISO6, LLC; Supplemental Notice That Initial Market-Based Rate Filing Includes Request for Blanket Section 204 AuthorizationPDF
80 FR 14126 - Combined Notice of FilingsPDF
80 FR 14139 - Cardiovascular and Renal Drugs Advisory Committee; Amendment of NoticePDF
80 FR 14106 - South Jersey Energy ISO8, LLC; Supplemental Notice That Initial Market-Based Rate Filing Includes Request for Blanket Section 204 AuthorizationPDF
80 FR 14106 - South Jersey Energy ISO7, LLC; Supplemental Notice That Initial Market-Based Rate Filing Includes Request for Blanket Section 204 AuthorizationPDF
80 FR 14187 - Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change Amending the NYSE Arca Options Fee Schedule Relating to Market Maker Posting Credit TiersPDF
80 FR 14191 - Self-Regulatory Organizations; BATS Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Related to Fees for Use of BATS Exchange, Inc.PDF
80 FR 14141 - Government-Owned Inventions; Availability for LicensingPDF
80 FR 14141 - National Institute of Arthritis and Musculoskeletal and Skin Diseases; Notice of Closed MeetingPDF
80 FR 14142 - Center for Scientific Review; Notice of Closed MeetingsPDF
80 FR 14143 - Center for Scientific Review; Notice of Closed MeetingPDF
80 FR 14146 - Identification of Alternative In Vitro Bioequivalence Pathways Which Can Reliably Ensure In Vivo Bioequivalence of Product Performance and Quality of Non-Systemically Absorbed Drug Products for Animals; Public MeetingPDF
80 FR 14138 - Agency Information Collection Activities; Proposed Collection; Comment Request; Emergency Shortages Data Collection SystemPDF
80 FR 14134 - Agency Information Collection Activities; Proposed Collection; Comment Request; Recommended Recordkeeping for Exempt Infant Formula ProductionPDF
80 FR 14019 - Approval and Promulgation of Implementation Plans; Region 4 States; 2008 Lead, 2008 Ozone and 2010 Nitrogen Dioxide Prevention of Significant Deterioration Infrastructure PlansPDF
80 FR 14092 - United States Manufacturing Council: Meeting of the United States Manufacturing CouncilPDF
80 FR 14189 - T. Rowe Price Associates, Inc. and T. Rowe Price International Ltd; Notice of ApplicationPDF
80 FR 14185 - Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend the Fees SchedulePDF
80 FR 14014 - Dimethomorph; Pesticide TolerancePDF
80 FR 14156 - Multistate Conservation Grant Program; Fiscal Year 2015 Priority List and Approval for Conservation ProjectsPDF
80 FR 14198 - Self-Regulatory Organizations; Financial Industry Regulatory Authority, Inc.; Notice of Filing of Amendment No. 1 to a Proposed Rule Change To Adopt FINRA Rule 2242 (Debt Research Analysts and Debt Research Reports)PDF
80 FR 14196 - Self-Regulatory Organizations; Miami International Securities Exchange LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend Its Fee SchedulePDF
80 FR 14174 - Self-Regulatory Organizations; Financial Industry Regulatory Authority, Inc.; Notice of Filing of Amendment No. 1 to a Proposed Rule Change To Adopt FINRA Rule 2241 (Research Analysts and Research Reports) in the Consolidated FINRA RulebookPDF
80 FR 14193 - Self-Regulatory Organizations; Chicago Stock Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Concerning the CHX Routing ServicesPDF
80 FR 14173 - Self-Regulatory Organizations; The Depository Trust Company; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Make Technical Revisions to the DTC Settlement Service GuidePDF
80 FR 14159 - Certain Audio Processing Hardware and Software and Products Containing Same; Institution of investigationPDF
80 FR 14127 - Tannery Island Power Corporation; Ampersand Tannery Island Hydro, LLC; Notice of Transfer of ExemptionPDF
80 FR 14125 - York Haven Power Company, Exelon Generation Company; Notice of Availability of the Final Environmental Impact Statement for the Susquehanna River Hydroelectric ProjectsPDF
80 FR 13995 - Amendments to Excepted BenefitsPDF
80 FR 14215 - Social Security Ruling, SSR 15-1p; Titles II and XVI: Evaluating Cases Involving Interstitial Cystitis (IC)PDF
80 FR 14248 - National Emission Standards for Hazardous Air Pollutants: Off-Site Waste and Recovery OperationsPDF
80 FR 14147 - Port Access Route Study: In the Chukchi Sea, Bering Strait and Bering SeaPDF

Issue

80 52 Wednesday, March 18, 2015 Contents Agriculture Agriculture Department See

Federal Crop Insurance Corporation

See

Forest Service

See

National Agricultural Statistics Service

NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 14070-14071 2015-06195
Centers Disease Centers for Disease Control and Prevention NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 14140-14141, 14143-14145 2015-06159 2015-06160 Centers Medicare Centers for Medicare & Medicaid Services NOTICES Hearings: Reconsideration of Disapproval Louisiana Medicaid State Plan Amendment 12-66-B, 14145-14146 2015-06226 Civil Rights Civil Rights Commission NOTICES Meetings: Missouri Advisory Committee; Matters Related to its Project on Police Community Relations in Missouri, 14071-14072 2015-06201 Coast Guard Coast Guard RULES Safety Zones: Upper Mississippi River Between Mile 38.0 and 46.0, Thebes, IL; and Between Mile 78.0 and 81.0, Grand Tower, IL; Correction, 14009 2015-06174 NOTICES Port Access Route Study: Chukchi Sea, Bering Strait and Bering Sea; Withdrawals, 14147 2015-05372 Commerce Commerce Department See

Economic Development Administration

See

Foreign-Trade Zones Board

See

International Trade Administration

See

National Oceanic and Atmospheric Administration

Community Development Community Development Financial Institutions Fund NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 14244-14245 2015-06233 Economic Development Economic Development Administration NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Award Amendment Requests and Project Service Maps, 14072-14073 2015-06191 Property Management, 14096-14097 2015-06193 Requirements for Approved Construction Investments, 14095-14096 2015-06192 Education Department Education Department NOTICES Applications for New Awards: Technical Assistance and Dissemination to Improve Services and Results for Children with Disabilities, etc., 14097-14103 2015-06273 Employment and Training Employment and Training Administration NOTICES Worker Adjustment Assistance Eligibility Investigations; Petitions, 14163-14164 2015-06164 Worker Adjustment Assistance; Amended Certifications: Mondi Bags USA, LLC, et al., Philadelphia, OH, 14162 2015-06169 Riverside Manufacturing Co., et al., Riverside, GA, 14162 2015-06168 SMC Electrical Products, Inc., et al., Barboursville, WV, 14162-14163 2015-06171 Worker and Trade Adjustment Assistance; Determinations, 14165-14166 2015-06163 Employee Benefits Security Employee Benefits Security Administration RULES Amendments to Excepted Benefits, 13995-14009 2015-06066 Energy Department Energy Department See

Federal Energy Regulatory Commission

NOTICES Excess Uranium Management: Effects of Transfers of Excess Uranium on Domestic Uranium Mining, Conversion, and Enrichment Industries, 14107-14125 2015-06189
Environmental Protection Environmental Protection Agency RULES Air Quality State Implementation Plans; Approvals and Promulgations: Region 4 States; 2008 Lead, 2008 Ozone and 2010 Nitrogen Dioxide Prevention of Significant Deterioration Infrastructure Plans, 14019-14024 2015-06112 National Emission Standards: Off-Site Waste and Recovery Operations, 14248-14283 2015-05463 Pesticide Tolerances: 2-Propenoic acid, polymer with ethenyl acetate, ethenylbenzene, 2-ethylhexyl 2-propenoate and ethyl 2-propenoate; Exemption, 14024-14027 2015-06227 Boscalid, 14009-14014 2015-06141 Dimethomorph, 14014-14019 2015-06106 PROPOSED RULES Air Quality State Implementation Plans; Approvals and Promulgations: Alaska, 14038-14041 2015-06216 Arizona; Stationary Sources; New Source Review, 14044-14062 2015-06143 Maryland; Determination of Attainment of the 2008 8-Hour Ozone National Ambient Air Quality Standard for the Baltimore Moderate Nonattainment Area, 14041-14044 2015-06220 Missouri; Construction Permits Required, 14062-14066 2015-06153 Operating Permit Programs under the Clean Air Act: Pennsylvania; Revision, 14037-14038 2015-06145 NOTICES Meetings: Environmental Financial Advisory Board, 14130 2015-06215 Science Advisory Board Drinking Water Committee, 14130-14131 2015-06222 Requests for Nominations: Pesticide Program Dialogue Committee; Extensions, 14129-14130 2015-06276 Federal Aviation Federal Aviation Administration NOTICES Meetings: Hazardous Materials Safety Program, 14243-14244 2015-06158 RTCA Special Committee 225, Rechargeable Lithium Battery and Battery Systems, 14229 2015-06260 Requests to Release Airport Property: Ottumwa Regional Airport, Ottumwa, IA, 14240 2015-06259 Federal Communications Federal Communications Commission NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 14131-14132 2015-06151 Federal Crop Federal Crop Insurance Corporation PROPOSED RULES General Administrative Regulations: Interpretations of Statutory Provisions, Policy Provisions, and Procedures, 14030-14033 2015-06224 Federal Deposit Federal Deposit Insurance Corporation NOTICES Meetings: Advisory Committee on Community Banking, 14132 2015-06209 Federal Energy Federal Energy Regulatory Commission NOTICES Applications: Rockies Express Pipeline LLC, 14105-14106 2015-06207 Combined Filings, 14103-14105, 14126-14128 2015-06131 2015-06133 2015-06134 2015-06135 2015-06165 Environmental Impact Statements; Availability, etc.: York Haven Power Co.; Exelon Generation Co.; Susquehanna River Hydroelectric Projects, 14125 2015-06077 Exemption Transfers: Tannery Island Power Corp.; Ampersand Tannery Island Hydro, LLC, 14127 2015-06079 Initial Market-Based Rate Filings Including Requests for Blanket Section 204 Authorizations: California Clean Power Corp., 14126 2015-06166 South Jersey Energy ISO6, LLC, 14103 2015-06132 South Jersey Energy ISO7, LLC, 14106 2015-06128 South Jersey Energy ISO8, LLC, 14106 2015-06129 Meetings: N.E.W. Hydro, LLC, 14129 2015-06206 Requests under Blanket Authorizations: Texas Eastern Transmission, LP, 14129 2015-06204 Technical Conferences: Review of Cost Submittals by Other Federal Agencies for Administering Part I of the Federal Power Act, 14127 2015-06203 Federal Maritime Federal Maritime Commission NOTICES Agreements Filed, 14132-14133 2015-06202 Federal Motor Federal Motor Carrier Safety Administration NOTICES Hours of Service of Drivers; Exemption Applications: Oregon Trucking Association, 14227-14229 2015-06184 Trailways Cos., 14229-14231 2015-06176 Parts and Accessories Necessary for Safe Operation; Exemption Applications: Mobileye, Inc., 14222-14223 2015-06180 Parts and Accessories Necessary for Safe Operation; Exemptions: Lytx, Inc., 14231-14232 2015-06190 Qualification of Drivers; Exemption Applications: Diabetes Mellitus, 14232-14238 2015-06175 Vision, 14220-14227, 14240-14243 2015-06177 2015-06178 2015-06179 Federal Railroad Federal Railroad Administration RULES Railworthiness Directives: Railroad Tank Cars Equipped with Certain McKenzie Valve and Machining, LLC, Valves, 14027-14029 2015-06213 NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 14238-14239 2015-06214 Federal Reserve Federal Reserve System NOTICES Changes in Bank Control: Acquisitions of Shares of a Bank or Bank Holding Company, 14133 2015-06198 Formations of, Acquisitions by, and Mergers of Bank Holding Companies, 14133-14134 2015-06196 Formations of, Acquisitions by, and Mergers of Savings and Loan Holding Companies, 14133 2015-06197 Federal Transit Federal Transit Administration NOTICES Prevention of Alcohol Misuse and Prohibited Drug Use in Transit Operations; Testing Rates, 14239-14240 2015-06225 Fish Fish and Wildlife Service NOTICES Endangered Species Permit Applications, 14150-14152 2015-06230 Multistate Conservation Grant Program: Fiscal Year 2015 Priority List and Approval for Conservation Projects, 14156-14157 2015-06097 Food and Drug Food and Drug Administration NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Emergency Shortages Data Collection System, 14138-14139 2015-06118 Recommended Recordkeeping for Exempt Infant Formula Production, 14134-14138 2015-06117 Meetings: Cardiovascular and Renal Drugs Advisory Committee, 14139-14140 2015-06130 Identification of Alternative In Vitro Bioequivalence Pathways Which Can Reliably Ensure In Vivo Bioequivalence of Product Performance and Quality of Non-Systemically Absorbed Drug Products for Animals, 14146-14147 2015-06119 Foreign Trade Foreign-Trade Zones Board NOTICES Proposed Production Activities: Givaudan Fragrances Corp., Foreign-Trade Zone 44, Mount Olive, NJ, 14094-14095 2015-06271 Forest Forest Service NOTICES Fee Increases under the Federal Lands Recreation Enhancement Act: Ashley National Forest, 14071 2015-06156 Health and Human Health and Human Services Department See

Centers for Disease Control and Prevention

See

Centers for Medicare & Medicaid Services

See

Food and Drug Administration

See

National Institutes of Health

Health and Human Services Health and Human Services Department RULES Amendments to Excepted Benefits, 13995-14009 2015-06066 Homeland Homeland Security Department See

Coast Guard

Housing Housing and Urban Development Department NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Standardized Form for Collecting Information Regarding Race and Ethnic Data, 14148 2015-06199 Interior Interior Department See

Fish and Wildlife Service

See

Land Management Bureau

See

Reclamation Bureau

NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: American Customer Satisfaction Index Government Customer Satisfaction Surveys, 14152-14154 2015-06241 E-Government Website Customer Satisfaction Surveys (Formerly American Customer Satisfaction Index E-Government Website Customer Satisfaction Surveys), 14154-14156 2015-06240 Generic Clearance for the Collection of Qualitative Feedback on Agency Service Delivery, 14158-14159 2015-06242 Programmatic Clearance for Customer Satisfaction Surveys, 14148-14150 2015-06229
Internal Revenue Internal Revenue Service RULES Amendments to Excepted Benefits, 13995-14009 2015-06066 International Trade Adm International Trade Administration NOTICES Antidumping or Countervailing Duty Investigations, Orders, or Reviews: Circular Welded Carbon-Quality Steel Pipe from the People's Republic of China, 14091 2015-06237 Export Trade Certificates of Review, 14092-14094 2015-06248 Meetings: President's Advisory Council on Doing Business in Africa, 14095 2015-06173 United States Manufacturing Council, 14092 2015-06111 International Trade Com International Trade Commission NOTICES Investigations; Determinations, Modifications, and Rulings, etc.: Certain Audio Processing Hardware and Software and Products Containing Same, 14159-14160 2015-06081 Certain Non-Volatile Memory Chips and Products Containing the Same, 14160-14161 2015-06170 Requests for Statements: Certain Television Sets, Receivers and Tuners and Components Thereof Capabilities and Components Thereof, 14161-14162 2015-06172 Labor Department Labor Department See

Employment and Training Administration

See

Employee Benefits Security Administration

NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Bloodborne Pathogens Standard, 14164 2015-06162
Land Land Management Bureau NOTICES Meetings: Albuquerque District Resource Advisory Council, New Mexico, 14159 2015-06228 NASA National Aeronautics and Space Administration NOTICES Exclusive Licenses, 14166 2015-06231 Meetings: NASA Advisory Council; Ad Hoc Task Force on STEM Education, 14166-14167 2015-06232 National Agricultural National Agricultural Statistics Service NOTICES Meetings: Expert Panel on Federal Statistics on Women and Beginning Farmers in U.S. Agriculture, 14070 2015-06181 National Archives National Archives and Records Administration NOTICES Records Schedules; Availability, 14167-14168 2015-06186 National Institute National Institutes of Health NOTICES Government-Owned Inventions; Availability for Licensing, 14141-14142 2015-06123 Meetings: Center for Scientific Review, 14142-14143 2015-06120 2015-06121 National Institute of Arthritis and Musculoskeletal and Skin Diseases, 14141 2015-06122 National Oceanic National Oceanic and Atmospheric Administration PROPOSED RULES Fisheries Off West Coast States; West Coast Salmon Fisheries: Management Reference Point Updates for Three Stocks of Pacific Salmon, 14066-14069 2015-06144 NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 14072 2015-06219 Meetings: Western Pacific Fishery Management Council, 14094 2015-06200 Takes of Marine Mammals: Russian River Estuary Management Activities, 14073-14091 2015-06236 Neighborhood Neighborhood Reinvestment Corporation NOTICES Meetings; Sunshine Act, 14168 2015-06281 Nuclear Regulatory Nuclear Regulatory Commission PROPOSED RULES Radiation Protection, 14033-14034 2015-06244 NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Billing Instructions for NRC Cost Type Contracts, 14172-14173 2015-06154 Confirmatory Orders: Honeywell International, Inc., 14168-14172 2015-06243 Presidential Documents Presidential Documents PROCLAMATIONS Special Observances: National Poison Prevention Week (Proc. 9241), 14285-14288 2015-06382 ADMINISTRATIVE ORDERS Government Agencies and Employees: Council on Environmental Quality; Providing an Order of Succession (Memorandum of March 13, 2015), 14289-14290 2015-06383 Reclamation Reclamation Bureau NOTICES Meetings: Yakima River Basin Conservation Advisory Group; Yakima River Basin Water Enhancement Project, Yakima, WA, 14154 2015-06258 Securities Securities and Exchange Commission NOTICES Applications: T. Rowe Price Associates, Inc., and T. Rowe Price International Ltd., 14189-14191 2015-06110 Self-Regulatory Organizations; Proposed Rule Changes: BATS Exchange, Inc., 14191-14193 2015-06124 Chicago Board Options Exchange, Inc., 14185-14187 2015-06109 Chicago Stock Exchange, Inc., 14193-14195 2015-06091 Depository Trust Co., 14173-14174 2015-06089 Financial Industry Regulatory Authority, Inc., 14174-14185, 14198-14215 2015-06092 2015-06094 Miami International Securities Exchange, LLC, 14196-14198 2015-06093 NYSE Arca, Inc., 14187-14189 2015-06125 Small Business Small Business Administration PROPOSED RULES Small Business Investment Companies—Early Stage, 14034-14037 2015-06182 Social Social Security Administration NOTICES Rulings: Evaluating Cases Involving Interstitial Cystitis, 14215-14220 2015-05680 Transportation Department Transportation Department See

Federal Aviation Administration

See

Federal Motor Carrier Safety Administration

See

Federal Railroad Administration

See

Federal Transit Administration

NOTICES Applications for Certificates of Public Convenience and Necessity and Foreign Air Carrier Permits, 14229 2015-06183
Treasury Treasury Department See

Community Development Financial Institutions Fund

See

Internal Revenue Service

Separate Parts In This Issue Part II Environmental Protection Agency, 14248-14283 2015-05463 Part III Presidential Documents, 14285-14290 2015-06382 2015-06383 Reader Aids

Consult the Reader Aids section at the end of this page for phone numbers, online resources, finding aids, reminders, and notice of recently enacted public laws.

To subscribe to the Federal Register Table of Contents LISTSERV electronic mailing list, go to http://listserv.access.thefederalregister.org and select Online mailing list archives, FEDREGTOC-L, Join or leave the list (or change settings); then follow the instructions.

80 52 Wednesday, March 18, 2015 Rules and Regulations DEPARTMENT OF THE TREASURY Internal Revenue Service 26 CFR Part 54 [TD 9714] RIN 1545-BM44 DEPARTMENT OF LABOR Employee Benefits Security Administration 29 CFR Part 2590 RIN 1210-AB70 DEPARTMENT OF HEALTH AND HUMAN SERVICES 45 CFR Part 146 [CMS-9946-F2] RIN 0938-AS52 Amendments to Excepted Benefits AGENCY:

Internal Revenue Service, Department of the Treasury; Employee Benefits Security Administration, Department of Labor; Centers for Medicare & Medicaid Services, Department of Health and Human Services.

ACTION:

Final rules.

SUMMARY:

This document contains final regulations that amend the regulations regarding excepted benefits under the Employee Retirement Income Security Act of 1974, the Internal Revenue Code, and the Public Health Service Act to specify requirements for limited wraparound coverage to qualify as an excepted benefit. Excepted benefits are generally exempt from the requirements that were added to those laws by the Health Insurance Portability and Accountability Act and the Affordable Care Act.

DATES:

These final regulations are effective on May 18, 2015.

FOR FURTHER INFORMATION CONTACT:

Amy Turner or Elizabeth Schumacher, Employee Benefits Security Administration, Department of Labor, at (202) 693-8335; Karen Levin, Internal Revenue Service, Department of the Treasury, at (202) 317-5500; Jacob Ackerman, Centers for Medicare & Medicaid Services, Department of Health and Human Services, at (410) 786-1565.

Customer Service Information: Individuals interested in obtaining information from the Department of Labor concerning employment-based health coverage laws, may call the EBSA Toll-Free Hotline at 1-866-444-EBSA (3272) or visit the Department of Labor's Web site (http://www.dol.gov/ebsa). In addition, information from HHS on private health insurance for consumers can be found on the Centers for Medicare & Medicaid Services (CMS) Web site (www.cms.gov/cciio) and information on health reform can be found at www.HealthCare.gov.

SUPPLEMENTARY INFORMATION:

I. Background

The Health Insurance Portability and Accountability Act of 1996 (HIPAA), Public Law 104-191, 110 Stat. 1936 added title XXVII of the Public Health Service Act (PHS Act), part 7 of the Employee Retirement Income Security Act of 1974 (ERISA), and chapter 100 of the Internal Revenue Code (the Code), providing portability and nondiscrimination provisions with respect to health coverage. These provisions of the PHS Act, ERISA, and the Code were later augmented by other consumer protection laws, including the Mental Health Parity Act of 1996,1 the Mental Health Parity and Addiction Equity Act of 2008,2 the Newborns' and Mothers' Health Protection Act,3 the Women's Health and Cancer Rights Act,4 the Genetic Information Nondiscrimination Act of 2008,5 the Children's Health Insurance Program Reauthorization Act of 2009,6 Michelle's Law,7 and the Affordable Care Act.8

1 Public Law 104-204, 110 Stat. 2944 (September 26, 1996).

2 Public Law 110-343, 122 Stat. 3881 (October 3, 2008).

3 Public Law 104-204, 110 Stat. 2935 (September 26, 1996).

4 Public Law 105-277, 112 Stat. 2681-436 (October 21, 1998).

5 Public Law 110-233, 122 Stat. 881 (May 21, 2008).

6 Public Law 111-3, 123 Stat. 65 (February 4, 2009).

7 Public Law 110-381, 122 Stat. 4081 (October 9, 2008).

8 The Patient Protection and Affordable Care Act, Public Law 111-148, was enacted on March 23, 2010, and the Health Care and Education Reconciliation Act, Public Law 111-152, was enacted on March 30, 2010. (These statutes are collectively known as the “Affordable Care Act”.)

The Affordable Care Act reorganizes, amends, and adds to the provisions of part A of title XXVII of the PHS Act relating to group health plans and health insurance issuers in the group and individual markets. The term “group health plan” includes both insured and self-insured group health plans.9 Section 715(a)(1) of ERISA and section 9815(a)(1) of the Code, as added by the Affordable Care Act, incorporate the provisions of part A of title XXVII of the PHS Act into ERISA and the Code to make them applicable to group health plans and health insurance issuers providing health insurance coverage in connection with group health plans. The PHS Act sections incorporated by these references are sections 2701 through 2728.

9 The term “group health plan” is used in title XXVII of the PHS Act, part 7 of ERISA, and chapter 100 of the Code, and is distinct from the term “health plan,” as used in other provisions of title I of the Affordable Care Act. The term “health plan” does not include self-insured group health plans.

Sections 2722 and 2763 of the PHS Act, section 732 of ERISA, and section 9831 of the Code provide that the requirements of title XXVII of the PHS Act, part 7 of ERISA, and chapter 100 of the Code, respectively, generally do not apply to excepted benefits. Excepted benefits are described in section 2791 of the PHS Act, section 733 of ERISA, and section 9832 of the Code.

The parallel statutory provisions establish four categories of excepted benefits. The first category includes benefits that are generally not health coverage 10 (such as automobile insurance, liability insurance, workers compensation, and accidental death and dismemberment coverage). The benefits in this category are excepted in all circumstances. In contrast, the benefits in the second, third, and fourth categories are types of health coverage but are excepted only if certain conditions are met.

10 See 62 FR 16894, 16903 (Apr. 8, 1997), which states that these benefits are generally not health insurance coverage.

The second category of excepted benefits is limited excepted benefits, which may include limited scope vision or dental benefits, and benefits for long-term care, nursing home care, home health care, or community based care. Section 2791(c)(2)(C) of the PHS Act, section 733(c)(2)(C) of ERISA, and section 9832(c)(2)(C) of the Code authorize the Secretaries of Health and Human Services (HHS), Labor, and the Treasury (collectively, the Secretaries) to issue regulations establishing other, similar limited benefits as excepted benefits. The Secretaries exercised this authority previously with respect to certain health flexible spending arrangements (health FSAs).11 To be excepted under this second category, the statute (specifically, ERISA section 732(c)(1), PHS Act section 2722(c)(1), and Code section 9831(c)(1)) provides that limited benefits must either: (1) Be provided under a separate policy, certificate, or contract of insurance; or (2) otherwise not be an integral part of a group health plan, whether insured or self-insured.12

11 26 CFR 54.9831-1(c)(3)(v); 29 CFR 2590.732(c)(3)(v); 45 CFR 146.145(b)(3)(v).

12 See the discussion in the 2014 final regulations concerning the application of these requirements to benefits such as limited-scope dental and vision benefits and employee assistance programs at 79 FR 59131 (Oct. 1, 2014).

The third category of excepted benefits, referred to as “noncoordinated excepted benefits,” includes both coverage for only a specified disease or illness (such as cancer-only policies), and hospital indemnity or other fixed indemnity insurance. In the group market, these benefits are excepted only if all of the following conditions are met: (1) The benefits are provided under a separate policy, certificate, or contract of insurance; (2) there is no coordination between the provision of such benefits and any exclusion of benefits under any group health plan maintained by the same plan sponsor; and (3) the benefits are paid with respect to any event without regard to whether benefits are provided under any group health plan maintained by the same plan sponsor.13

13 26 CFR 54.9831-1(c)(4); 29 CFR 2590.732(c)(4); 45 CFR 146.145(b)(4). See also Q7 in Affordable Care Act Implementation FAQs Part XI, available at http://www.dol.gov/ebsa/faqs/faq-aca11.html and http://www.cms.gov/CCIIO/Resources/Fact-Sheets-and-FAQs/aca_implementation_faqs11.html.

The fourth category of excepted benefits is supplemental excepted benefits.14 Such benefits must be: (1) Coverage supplemental to Medicare, coverage supplemental to the Civilian Health and Medical Program of the Department of Veterans Affairs (CHAMPVA) or to Tricare, or similar coverage that is supplemental to coverage provided under a group health plan; and (2) provided under a separate policy, certificate, or contract of insurance.15

14 On February 13, 2015, the Departments issued guidance to clarify whether insurance coverage that supplements group health coverage by providing additional categories of benefits (and does not also fill gaps in group health plan coverage for cost-sharing obligations, such as coinsurance or deductibles) can be characterized as an excepted benefit. See Affordable Care Act Implementation FAQs Part XXIII, available at http://www.dol.gov/ebsa/faqs/faq-aca23.html and http://www.cms.gov/CCIIO/Resources/Fact-Sheets-and-FAQs/Downloads/Supplmental-FAQ_2-13-15-final.pdf.

15 26 CFR 54.9831-1(c)(5); 29 CFR 2590.732(c)(5); 45 CFR 146.145(b)(5). The Departments issued additional guidance regarding supplemental health insurance coverage as excepted benefits. See EBSA Field Assistance Bulletin No. 2007-04 (available at http://www.dol.gov/ebsa/pdf/fab2007-4.pdf); CMS Insurance Standards Bulletin 08-01 (available at http://www.cms.gov/CCIIO/Resources/Files/Downloads/hipaa_08_01_508.pdf); and IRS Notice 2008-23 (available at http://www.irs.gov/irb/2008-07_IRB/ar09.html).

In 2004, the Departments of the Treasury, Labor, and HHS published final regulations with respect to excepted benefits (the HIPAA regulations).16 (Subsequent references to the “Departments” include all three Departments, unless the headings or context indicate otherwise.)

16 69 FR 78720 (Dec. 30, 2004).

On December 24, 2013, the Departments published additional proposed regulations with respect to the second category of excepted benefits, limited excepted benefits (2013 proposed regulations).17 The 2013 proposed regulations proposed to: (1) Eliminate the requirement that participants in self-insured plans pay an additional premium or contribution for limited-scope vision or dental benefits to qualify as benefits that are not an integral part of the plan; (2) set forth the criteria under which employee assistance programs (EAPs) that do not provide significant benefits in the nature of medical care constitute excepted benefits; and (3) allow plan sponsors in certain limited circumstances to offer, as excepted benefits, coverage that wraps around certain individual health insurance coverage. The intent of limited wraparound coverage is to permit employers to provide certain employees, dependents, and retirees who are enrolled in some type of individual market coverage with overall coverage that is generally comparable to the coverage provided under the employers' group health plan, without eroding employer-sponsored coverage.

17 78 FR 77632.(Dec. 23, 2014).

After consideration of comments received on the 2013 proposed regulations, the Departments published final regulations regarding dental and vision benefits and EAP benefits on October 1, 2014 (2014 final regulations).18 In the 2014 final regulations, the Departments also stated their intent to publish regulations that addressed limited wraparound coverage in the future, taking into account the extensive comments received on this issue.19 After consideration of comments on the 2013 proposed regulations, on December 23, 2014, the Departments published new proposed regulations with respect to limited wraparound coverage (2014 proposed regulations), which set forth five requirements under which limited benefits provided through a group health plan that wrap around either eligible individual insurance or coverage under a Multi-State Plan would constitute excepted benefits.20 A description of the 2014 proposed regulations is set forth below, together with a summary of the comments received on the 2014 proposed regulations and an overview of these final regulations.

18 79 FR 59131 (Oct. 1, 2014).

19 79 FR 59131 (Oct. 1, 2014).

20 79 FR 76931 (Dec. 23, 2014).

II. Overview of the Final Regulations

Under the 2014 proposed regulations, limited benefits provided through a group health plan that wrap around either (1) eligible individual health insurance, or (2) coverage under a Multi-State Plan (collectively referred to as “limited wraparound coverage”) could constitute excepted benefits, if five requirements were met. For this purpose, the 2014 proposed regulations defined “eligible individual health insurance” as individual health insurance coverage that is not a grandfathered health plan,21 not a transitional individual health insurance market plan,22 and does not consist solely of excepted benefits. The preamble to the 2014 proposed regulations acknowledged that, in States that elect to establish a Basic Health Program (BHP), certain low-income individuals (for example, those with household income between 133 percent and 200 percent of the Federal poverty level) who would otherwise qualify for a tax credit to obtain a qualified health plan through an Exchange would instead be enrolled in coverage through the BHP. The Departments invited comments on how an employer might make wraparound coverage available to BHP enrollees.23

21See section 1251 of the Affordable Care Act, 29 CFR 2590.715-1251, and 45 CFR 147.140.

22 As described in CMS Insurance Standards Bulletin (March 5, 2014) available at: http://www.cms.gov/CCIIO/Resources/Regulations-and-Guidance/Downloads/transition-to-compliant-policies-03-06-2015.pdf.

23 79 FR 76935, footnote 32.

Comments addressing the BHP all supported permitting wraparound of BHP coverage. The Departments agree and, therefore, these final regulations permit limited wraparound coverage of BHP coverage in the same manner as limited wraparound coverage of eligible individual health insurance.

A. Covers Additional Benefits

The 2014 proposed regulations stated that limited wraparound coverage would have to be specifically designed to wrap around eligible individual health insurance or Multi-State Plan coverage. That is, the limited wraparound coverage would have to provide meaningful benefits beyond coverage of cost sharing under the eligible individual health insurance or Multi-State Plan coverage. The preamble to the 2014 proposed regulations provided examples, such as that limited wraparound coverage could provide coverage for expanded in-network medical clinics or providers, or provide benefits that are not essential health benefits (EHBs) and that are not covered under the eligible individual health insurance.24 The preamble to the 2014 proposed regulations also provided that limited wraparound coverage would not be permitted to provide benefits solely under a coordination-of-benefits provision and could not be an account-based reimbursement arrangement.25 Limited wraparound coverage that covers solely cost sharing would not be permissible, as stated in the preamble to the 2014 proposed regulations, because reduced cost sharing can be obtained by choosing an individual health insurance policy with a higher actuarial value (for example, a platinum plan with a 90 percent actuarial value).26 The Departments invited comment on safe harbors standardizing the benefits in the limited wraparound coverage that could be established.

24 79 FR 76935

25 79 FR 76936

26Id.

Many commenters requested additional clarity on the type of benefits that could be offered as meaningful benefits in limited wraparound coverage. Suggestions included reimbursement for the full cost of primary care, the cost of prescription drugs not on the formulary of the primary plan, ten physician visits per year, services considered to be provided out-of-network by the primary plan, access to onsite clinics or specific health facilities at no cost, or benefits targeted to a specific population (such as coverage for certain orthopedic injuries), home health coverage, or coverage of other benefits that are not covered EHBs under the primary plan. The Departments consider all of these examples to qualify as additional, meaningful benefits under this first requirement to be limited wraparound coverage that qualifies as excepted benefits. As discussed further below, the Departments reiterate that limited wraparound coverage that is an excepted benefit cannot be an account-based mechanism and instead must be a risk-sharing product that covers a defined package of services.

B. Limited in Amount

For the second requirement to be limited wraparound coverage that qualifies as excepted benefits, the Departments proposed that the limited wraparound coverage be limited in amount. Specifically, the 2014 proposed regulations provided that the annual cost of coverage per employee (and any covered dependents) under the limited wraparound coverage could not exceed the maximum annual contribution for health FSAs (which was $2,500 in 2014), indexed in the manner prescribed under Code section 125(i)(2) (which amounts to $2,550 for 2015), and the cost of coverage would include both employer and employee contributions towards coverage and be determined in the same manner as the applicable premium is calculated under a COBRA continuation provision. The preamble to the 2014 proposed regulations stated that the bright-line limitation was intended to be simpler to administer than a cap of 15 percent of the cost of the plan sponsor's primary coverage as set forth in the 2013 proposed regulations.

Many comments stated that the limits on the amount should be higher so that individuals eligible for the limited wraparound coverage would not experience gaps in coverage. Some commenters suggested that the Departments consider an alternative, referencing the higher health savings account (HSA) limits, which are $3,350 for individual coverage and $6,650 for families in 2015, indexed annually. Others suggested the Departments set the limit as the greater of: The maximum permitted annual salary reduction towards a health FSA (as was set forth in the 2014 proposed regulations), or a percentage of the cost of coverage under the primary plan (as was set forth in the 2013 proposed regulations).

These final regulations adopt the last suggestion. Either the dollar or percent limitation would satisfy the Departments' objective of ensuring that the limited wraparound coverage provides a limited benefit, as required by the statute, and be similar to other limited excepted benefits (that is, dental benefits, vision benefits, long term care, nursing home care, home health care, community-based care, or health FSAs as described in 26 CFR 54.9831-1(c)(3); 29 CFR 2590.732(c)(3); 45 CFR 146.145(b)(3)). The percentage, as in the 2013 proposed regulations, is 15 percent of the cost of coverage under the primary plan.

The final regulations do not adopt the suggestion to use much higher limits on the cost of coverage (for example, the HSA limits). Too large a benefit that is not limited in scope (c.f., limited-scope dental and vision excepted benefits) would not constitute a “similar, limited benefit” under ERISA section 733(c)(2), PHS Act section 2791(c)(2), or Code section 9832(c)(2).

The Departments also received requests for clarification regarding the administration of the second requirement (that is, that the limited wraparound coverage be limited in amount). Some comments requested that the determination of the cost of coverage be permitted to be made on an aggregate basis in advance of each plan year by an actuary, and not based on actual experience of the group or any individual during the plan year. This approach is precisely the approach that was intended by the Departments. As stated earlier, to qualify as excepted benefits, the limited wraparound coverage could not be an account-based reimbursement arrangement. That is, the coverage must include a risk-sharing element. As such, making a determination regarding the cost of coverage must occur on an aggregate basis. Moreover, to the extent this determination for a given plan year is made on sound actuarial principles that are appropriately documented, the actual experience of the group or any individual during the plan year would not be a factor in determining the cost of coverage for that plan year (although it could impact future years by providing additional information on which the actuarial estimate of the cost of coverage for future years would be based). The final regulations include this clarification.

C. Nondiscrimination

Under the 2014 proposed regulations, the third requirement for limited wraparound coverage to qualify as excepted benefits related to nondiscrimination. Specifically, the Departments proposed three sub-requirements relating to nondiscrimination. First, the wraparound coverage could not impose any preexisting condition exclusion, consistent with the requirements of section 2704 of the PHS Act (as incorporated into section 715 of ERISA and section 9815 of the Code) and implementing regulations.27 Second, the wraparound coverage could not discriminate against individuals in eligibility, benefits, or premiums based on any health factor of an individual (or any dependent of the individual), consistent with the requirements of section 702 of ERISA, section 9802 of the Code, and section 2705 of the PHS Act (as incorporated into section 715 of ERISA and section 9815 of the Code) and implementing regulations.28 Finally, neither the primary group health plan coverage nor the limited wraparound coverage could fail to comply with section 2716 of the PHS Act (as incorporated into section 715 of ERISA and section 9815 of the Code) or fail to be excludible from income with respect to any individual due to the application of section 105(h) of the Code (as applicable). These final regulations adopt the approach outlined in the 2014 proposed regulations.

27 29 CFR 2590.715-2704 and 45 CFR 147.108. See also Q2 in Affordable Care Act Implementation FAQs Part XXII, available at http://www.dol.gov/ebsa/faqs/faq-aca22.html and http://www.cms.gov/CCIIO/Resources/Fact-Sheets-and-FAQs/Downloads/FAQs-Part-XXII-FINAL.pdf regarding the prohibition against offering employees with high claims risk a choice between enrollment in its standard group health plan or cash.

28 26 CFR 54.9802-1, 29 CFR 2590.702, and 45 CFR 146.121.

The Departments received two comments on this third requirement. One commenter inquired as to the potential interaction between excepted benefits and the excise tax on high cost employer-sponsored health coverage under Code section 4980I. The Treasury and the IRS issued Notice 2015-16 on February 23, 2015 describing potential approaches with regard to a number of issues under Code section 4980I and inviting comments by May 15, 2015. Issues relating to Code section 4980I will be addressed as part of that rulemaking. Another commenter requested that the Departments consider “modernizing” the nondiscrimination provisions under Code section 105(h) and section 2716 of the PHS Act relating to prohibiting discrimination in favor of highly compensated employees. The Departments are considering this suggestion and other comments previously received for purposes of future guidance relating to these provisions.

D. Plan Eligibility Requirements

The fourth requirement to qualify as excepted benefits concerned plan eligibility requirements. First, under the 2014 proposed regulations, individuals eligible for the limited wraparound coverage could not be enrolled in excepted benefit coverage that is a health FSA. One commenter suggested permitting dual enrollment in limited wraparound coverage and health FSA coverage. However, as described earlier, the Departments are using their discretion under ERISA section 733(c)(2), PHS Act section 2791(c)(2), and Code section 9832(c)(2) to define “other similar, limited benefits” as excepted benefits and do not adopt this suggestion. To ensure that wraparound coverage is a limited benefit, like health FSAs, the Departments do not intend to allow plan sponsors to combine multiple excepted benefits into an arrangement that functions as a material substitute for primary group health plan coverage and still be exempt from the health market reforms.

Under the 2014 proposed regulations, as part of the fourth requirement for limited wraparound coverage to constitute excepted benefits, coverage would be required to comply with one of two alternative sets of standards relating to eligibility and benefits: one set of plan eligibility requirements for wraparound benefits offered in conjunction with eligible individual health insurance (or BHP coverage) for persons who are not full-time employees, and a separate set of standards for coverage that wraps around certain Multi-State Plan coverage. As described further below, limited wraparound coverage for persons who are not full-time employees is intended for employers that are generally offering affordable, minimum value coverage to their full-time workers but want to offer an additional limited benefit to their part-time workers. Limited wraparound coverage offered in conjunction with a Multi-State Plan is intended for employers that were offering reasonably comprehensive coverage prior to the promulgation of these final rules, and wish to offer limited wraparound coverage while still contributing roughly the same total amount toward their employees' health benefits.

1. Limited Wraparound Coverage Offered in Conjunction With Eligible Individual Health Insurance (or BHP Coverage) for Persons Who Are Not Full-Time Employees

As under the 2014 proposed regulations, limited coverage that wraps around eligible individual health insurance (or BHP coverage) for an individual who is not a full-time employee is required to satisfy three standards relating to plan eligibility.

i. Employer Obligations With Respect to Full-Time Employees

First, for each year that wraparound coverage is offered, the employer that is the sponsor of the plan offering wraparound coverage, or the employer participating in a plan offering wraparound coverage, must offer to its full-time employees coverage that: (1) Is substantially similar to coverage that the employer would need to offer to its full-time employees in order not to be subject to a potential assessable payment under the employer shared responsibility provisions of section 4980H(a) of the Code, if such provisions were applicable (that is, substantially similar to an offer of minimum essential coverage (as defined in Code section 5000A(f)) to at least 95 percent of its full-time employees (or to all but five of its full-time employees, if five is greater than five percent of its full-time employees)); (2) provides minimum value (as defined in section 36B(c)(2)(C)(ii) of the Code); and (3) is reasonably expected to be affordable (permitting use of the safe harbor rules for determining affordability set forth in 26 CFR 54.4980H-5(e)(2)). The preamble to the 2014 proposed regulations stated that, if a plan or issuer providing limited wraparound coverage takes reasonable steps to ensure that employers disclose necessary information regarding their coverage offered and affordability information to the plan or issuer, the plan or issuer could rely on reasonable representations by employers regarding this information, unless the plan or issuer has specific knowledge to the contrary.

Several commenters requested that, in the context of small employers and multiemployer plans, there be an exemption from the requirement that, to be considered excepted benefits, the employer offer to its full-time employees coverage that is substantially similar to coverage that the employer would need to offer pursuant to Code section 4980H(a). However, these final excepted benefits regulations are designed to allow plan sponsors an option to offer additional workers health coverage comparable to that which they already offer, rather than to serve as a substitute for primary coverage.

Other commenters asked the Departments to clarify that any Code section 4980H-related requirements are met in instances in which the employer has no full-time employees. These final regulations clarify that, in the event that the employer has no full-time employees, but the plan covers retirees (and their dependents), or covers part-time employees (and their dependents), the requirements to provide coverage that is substantially similar to coverage that the employer would need to offer to its full-time employees in order not to be subject to a potential assessable payment section 4980H(a) of the Code, that provides minimum value, and that is reasonably expected to be affordable, are all considered satisfied.

ii. Limited Eligibility

Second, eligibility for the limited wraparound coverage must be limited to employees who are not full-time employees (and their dependents), or who are retirees (and their dependents). In the preamble to the 2014 proposed regulations, the Departments stated that “full-time employees” would be employees who are reasonably expected to work at least an average of 30 hours per week. Plans and issuers would not be required to define “full-time employees” strictly in accordance with the rules of Code section 4980H, but employers could rely on the Code section 4980H definition, or any reasonable interpretation of who is reasonably expected to work an average of 30 hours a week, for purposes of this provision. The Departments invited comment on this approach.

Some commenters argued that plan sponsors should be able to offer limited coverage that wraps around eligible individual health insurance to full-time employees. The Departments do not adopt this change. A rationale for treating the wraparound coverage as an excepted benefit is that recipients will be able to use this limited type of coverage in conjunction with individual coverage purchased through an Exchange without being disqualified from claiming the premium tax credit. This may be attractive to employers as a means of providing some health coverage to employees who may not otherwise have been offered coverage, such as part-time employees or retirees. However, this is not intended to incentivize or permit employers to fail to offer minimum essential coverage to full-time employees, a population to whom employers have typically offered coverage.

One commenter sought clarification that plan sponsors offering limited wraparound coverage may rely on a determination of full-time employee status at the time of enrollment. The Departments agree that employers offering limited wraparound coverage will make determinations based on the expected status of an employee in the future as a part-time employee versus full-time employee. Accordingly, the final regulations include a clarification that this standard is met if it is reasonably determined at the time of enrollment that the employee will on average work fewer than 30 hours per week during the plan year. Moreover, for purposes of administering the premium tax credit under section 36B of the Code, if it is reasonably determined at the time of enrollment that the employee will on average work fewer than 30 hours per week during the plan year and therefore the employee is offered limited coverage that wraps around eligible individual health insurance, but the employee later during the coverage period meets the definition of a full-time employee, the coverage will not fail to be excepted benefits and the employee will not become ineligible for premium tax credits for the remainder of the plan year solely because the original reasonable determination proves incorrect. Whether, to be reasonable, that determination would need to be changed for future plan years will depend on all the facts and circumstances.

Several commenters sought clarification regarding the definition of “dependent.” Specifically, commenters asked whether the term “dependent” includes “spouses” (as the term is defined under 26 CFR 54.9801-2, 29 CFR 2590.701-2, and 45 CFR 144.103 for purposes of chapter 100 of the Code, part 7 of ERISA, and title XXVII of the PHS Act), or whether it is limited to “dependent children” (as the term is defined under Code section 4980H and its implementing regulations). These final regulations clarify that, for purposes of excepted benefits, the term “dependent” is defined by reference to the definitions section governing the market reforms (that is, 26 CFR 54.9801-2, 29 CFR 2590.701-2, and 45 CFR 144.103) and not the employer shared responsibility provisions under Code section 4980H and its implementing regulations. Accordingly, spouses may qualify as dependents to the extent they are eligible for coverage under the terms of the limited wraparound coverage. Moreover, some commenters sought clarification as to whether a plan could permit enrollment of a spouse beneficiary without enrollment of an employee participant. While nothing in these final regulations, nor any other provision of ERISA, the Code, or the PHS Act requires plans to enroll spouse beneficiaries for coverage (other than COBRA coverage) if the participant does not enroll, nothing in these provisions prohibits plans from enrolling such a spouse if plans choose to do so.29

29See ERISA section 601, Code section 4980B and PHS Act section 2201, which requires enrollment of qualified beneficiaries (including spouses) after a loss of coverage in connection with a qualifying event.

iii. Offer of Other Group Health Plan Coverage

Third, under the 2014 proposed regulations, other group health plan coverage, not limited to excepted benefits, would be required to be offered to the individuals eligible for the wraparound coverage. Only individuals eligible for other group health plan coverage could be eligible for the wraparound coverage.

Some commenters contended that plan sponsors should not be required to offer other group health plan coverage to individuals who are not full-time employees. This provision does not require employers to offer group health plan coverage to workers who are not full-time employees but it does limit the ability to offer the wrap-around coverage only to workers otherwise eligible for other group health plan coverage. That is because this provision is not intended to create an opportunity or incentive for employers to discontinue providing group health plan coverage and to encourage its employees to obtain coverage through the Exchange subsidized through the premium tax credit while still receiving meaningful employer-provided health benefits. Further, the same standard is applied in order for a health FSA to be an excepted benefit, and this provision in the final regulation is intended to allow employers to offer a limited benefit, similar to a health FSA.

2. Limited Wraparound Coverage Offered in Conjunction With Multi-State Plan Coverage

For limited coverage that wraps around Multi-State Plan coverage, four requirements would be required to be met under the 2014 proposed regulations.

i. OPM Review and Approval

The first of the four standards would require that the limited wraparound coverage be specifically designed and approved by the Office of Personnel Management (OPM) to provide benefits in conjunction with coverage under a Multi-State Plan authorized under section 1334 of the Affordable Care Act. Several comments sought clarification as to whether OPM would be designing limited wraparound coverage, or whether that would more appropriately be the role of the plan sponsor or health insurance issuer. These final rules include a modification to clarify that OPM would not design limited wraparound coverage. Instead, OPM's role would be to review and approve such coverage. Moreover, as indicated in the preamble to the 2014 proposed regulations, with respect to the maintenance of effort standard (discussed below), OPM's role is to ensure that group health plans and health insurance issuers offering Multi-State Plan wraparound coverage have a reasonable process in place for assuring employers meet the criteria set forth in these regulations for excepted benefits.

ii. Maintenance of Effort

The 2014 proposed regulations provided that the employer would have had to offer coverage in the plan year that began in 2014 that is substantially similar to coverage that the employer would need to have offered to its full-time employees in order to not be subject to an assessable payment under the employer shared responsibility provisions of section 4980H(a) of the Code, if such provisions had been applicable. In addition, in the plan year that began in 2014, the employer would have had to have offered coverage to a substantial portion of full-time employees that provided “minimum value” (as defined in section 36B(c)(2)(C)(ii) of the Code) and was affordable (applying the safe harbor rules for determining affordability set forth in 26 CFR 54.4980H-5(e)(2)). Finally, for the duration of the pilot program (described later in this preamble), the employer's annual aggregate contributions for both primary and limited wraparound coverage must be substantially the same as the employer's aggregate contributions for coverage offered to full-time employees in 2014. The Departments stated in the preamble that they were considering interpreting this “substantially the same” condition as a percentage (for example, 80 or 90 percent) and potentially applying it on a per-worker basis to allow for fluctuations in an employer's workforce.

Citing that some employers may have made changes to their coverage in 2014 because Exchange coverage was first available in 2014, several commenters requested that plan sponsors be permitted to use either 2013 or 2014 as the base year for this maintenance of effort requirement set forth in these second and third requirements for limited coverage that wraps around Multi-State Plan coverage. These final regulations adopt this suggestion.

Other comments stated that an employer's annual aggregate contribution toward primary and limited wraparound coverage should include any assessable payments under Code section 4980H owed by the employer. An applicable large employer may become subject to an assessable payment if it fails to offer minimum essential coverage to its full-time employees and one or more of those employees obtains a premium tax credit, or it fails to provide a full-time employee minimum essential coverage that provides minimum value and is affordable for that employee and that employee obtains a premium tax credit. In neither case does the payment of an assessable payment provide coverage to the employee or otherwise assist that employee in obtaining coverage. Nor does the fact that the failure to provide coverage may permit the employee to obtain the premium tax credit mean that the resulting fee is contributing toward that employee's health coverage. The final regulations, therefore, do not make this change.

Some comments sought clarification regarding whether the employer's annual aggregate contributions for both primary and limited wraparound coverage must be substantially the same as the employer's aggregate contributions for coverage offered to full-time employees in 2013 or 2014. Some requested OPM be given discretion to determine whether the maintenance of effort standard has been met by each employer. Others requested a threshold of 60 percent in determining whether this standard has been met. Many factors, including fluctuations in workforce size, cost of coverage, and employer contributions towards other fringe benefits may affect employer contributions from year to year. The final regulations retain the standard set forth in the 2014 proposed regulations that the employer's annual aggregate contributions for both primary and limited wraparound coverage must be substantially the same as the employer's aggregate contributions for coverage offered to full-time employees in 2014 (or 2013). For this purpose, the Departments consider this “substantially the same” condition to be met if contributions were at least 80 percent of contributions made in 2013 or 2014, applied on an average, full-time worker basis (to allow for fluctuations in an employer's workforce). OPM may make a finding, based on all the facts and circumstances, that other employer contribution arrangements also meet this standard. OPM may provide additional guidance (such as examples and safe harbors) in the future.

As with coverage that wraps around eligible individual health insurance (or that wraps around Basic Health Plan coverage), commenters asked the Departments to clarify that any Code section 4980H-related requirements are met in instances in which the employer has no full-time employees. These final regulations adopt a parallel clarification for coverage that wraps around Multi-State Plan coverage as for coverage that wraps around eligible individual health insurance (or that wraps around Basic Health Plan coverage). That is, while these final regulations do not permit new employers to provide wraparound coverage as an excepted benefit, these final regulations clarify that, in the event that the employer has no full-time employees, but the plan covers retirees (and their dependents), or covers part-time employees (and their dependents), the requirements that, in the plan year that began in 2013 or 2014, the employer would have had to have offered coverage to a substantial portion of full-time employees that provided minimum value and was affordable is met, as is the requirement that, for the duration of the pilot program, the employer's annual aggregate contributions for both primary and limited wraparound coverage must be substantially the same as the employer's aggregate contributions for coverage offered to full-time employees in 2013 or 2014.

For purposes of administering this provision with respect to limited wraparound coverage offered in conjunction with Multi-State Plan coverage, the Departments had proposed that the term “full-time employee” means a “full-time employee” as defined in 26 CFR 54.4980H-1(a)(21) who is not in a limited non-assessment period for certain employees (as defined in 26 CFR 54.4980H-1(a)(26)). Moreover, if a plan or issuer providing limited wraparound coverage takes reasonable steps to ensure that employers disclose necessary information regarding their coverage offered and contribution levels for 2013 or 2014 to the plan or issuer, the plan or issuer may rely on reasonable representations by employers regarding this information, unless the plan or issuer has specific knowledge to the contrary. Consistent with the reporting and evaluation criteria described later in this preamble, the Departments stated that OPM may verify that plans and issuers have reasonable mechanisms in place to ensure that contributing employers meet these standards.

E. Reporting

The fifth and final requirement for limited wraparound coverage to qualify as excepted benefits under the 2014 proposed regulations is a reporting requirement, for group health plans and group health insurance issuers, as well as group health plan sponsors. The final regulations adopt the approach outlined in the 2014 proposed regulations.

A self-insured group health plan, or a health insurance issuer offering or proposing to offer Multi-State Plan wraparound coverage, would report to OPM, in a form and manner specified in OPM guidance, information OPM reasonably requires to determine whether the plan or issuer qualifies to offer such coverage or complies with the applicable requirements of this section.

In addition, the plan sponsor of any group health plan offering any type of limited wraparound coverage would report to HHS, in a form and manner specified in guidance, information HHS reasonably requires to determine whether the exception for limited wraparound coverage is allowing plan sponsors to provide workers with comparable benefits whether enrolled in minimum essential coverage under a group health plan offered by the plan sponsor, or enrolled in eligible individual health insurance, BHP coverage, or Multi-State Plan coverage, with additional limited wraparound coverage offered by the plan sponsor, without causing an erosion of coverage.

Commenters requested that there be coordination of any reporting requirements with existing reporting requirements and some made specific suggestions regarding data elements that should be required for reporting. The Departments agree with the principle of non-duplication and will seek comment on any new reporting requirements through the process established by Paperwork Reduction Act of 1995.

F. Pilot Program With Sunset Date

Under the 2014 proposed regulations, limited wraparound coverage would be permitted under a pilot program for a limited time. Specifically, this type of wraparound coverage could be offered as excepted benefits if it is first offered no later than December 31, 2017, and ends on the later of: (1) The date that is three years after the date wraparound coverage is first offered; or (2) the date on which the last collective bargaining agreement relating to the plan terminates after the date wraparound coverage is first offered (determined without regard to any extension agreed to after the date the wraparound coverage is first offered). The 2014 proposed regulations invited comments on this time frame for applicability, including whether the Departments should have the option to provide for an earlier termination date.

Many commenters cited uncertainty and the lack of lead time as negatively impacting full utilization of the pilot program and requested a longer implementation period. The Departments agree that the timing for publication of these final rules makes 2015 plan year implementation impossible or impracticable for most plans. Accordingly, these final rules specify that wraparound coverage could be offered as excepted benefits if the coverage is first offered no earlier than January 1, 2016 and no later than December 31, 2018. The end date is unchanged from the proposal, that is the later of: (1) The date that is three years after the date wraparound coverage is first offered; or (2) the date on which the last collective bargaining agreement relating to the plan terminates after the date wraparound coverage is first offered (determined without regard to any extension agreed to after the date the wraparound coverage is first offered).

III. Economic Impact and Paperwork Burden A. Summary

As discussed in detail above, these regulations amend the definition of “limited excepted benefits” in the group market to provide plan sponsors with two options to offer limited wraparound coverage to certain individuals. Under the first option, a plan sponsor could offer limited benefits provided through a group health plan that wraps around eligible individual health insurance to employees who are not full-time employees (and their dependents), or who are retirees (and their dependents). For this purpose, full-time employees are employees who are reasonably expected to work at least an average of 30 hours per week. Under the second option, the limited wraparound coverage that satisfies the requirements outlined in the regulations must be approved by OPM and be offered in conjunction with Multi-State Plan coverage authorized under section 1334 of the Affordable Care Act. Under the first option, the limited benefits would also be permitted to wrap around the Basic Health Program authorized under section 1331 of the Affordable Care Act.

B. Executive Orders 12866 and 13563—Departments of Labor and HHS

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

Section 3(f) of Executive Order 12866 defines a “significant regulatory action” as an action that is likely to result in a regulation: (1) Having an annual effect on the economy of $100 million or more in any one year, or adversely and materially affecting a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or state, local, or tribal governments or communities (also referred to as “economically significant”); (2) creating a serious inconsistency or otherwise interfering with an action taken or planned by another agency; (3) materially altering the budgetary impacts of entitlement grants, user fees, or loan programs or the rights and obligations of recipients thereof; or (4) raising novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in the Executive Order. OMB has determined that the action is significant within the meaning of section 3(f)(4) of Executive Order 12866, and the Departments accordingly provide the following assessment of its potential benefits and costs.

The Departments recognize that many plan sponsors provide comprehensive health benefits to their workers. One objective of the Affordable Care Act is to allow individuals with comprehensive health insurance plans to maintain their current level of benefits. Some employers are interested in offering wraparound coverage to employees who are enrolled in a Multi-State Plan authorized under section 1334 of the Affordable Care Act or to part-time employees. These regulations provide two options to employers that clarify the circumstances under which plan sponsors can provide to their employees such limited wraparound coverage that qualifies as an excepted benefit.

The cost (and Federal budget impact 30 ) of these final regulations is difficult to quantify. The Departments solicited comments in the regulatory impact analysis section of the preamble to the 2014 proposed regulations. Comments were invited generally and on specific questions, including: To what degree, if any, might this regulation increase employers' propensity to provide health insurance? To what extent, if any, this proposed regulation could affect plan sponsors' decision making? Are there any particular sectors of the economy in which employers will be more or less inclined to pursue wraparound coverage programs?

30 As with other group health coverage, employer contributions to the limited wraparound coverage would be excluded from employee income for tax purposes. Similar to the cost of the proposal, the budget implications of adding limited wraparound coverage as a form of excepted benefits depends on the number of employers that elect either option and the number of employees that in turn receive it.

Comments were also invited on the effects of the proposal and the Departments requested detailed data that would inform the following questions: What will be the impact of limiting the cost of the wraparound coverage to $2,500 per employee (and any covered dependents)? How many employers offer coverage that provides minimum value and is affordable for a substantial portion (under the first option) or 95 percent (under the second option) of employees who are eligible for coverage? To what extent would premiums for comprehensive health coverage change in the presence and absence of this rule?

No specific data were received in response to this solicitation, although several commented that limited conditions under which wraparound coverage could be offered were overly restrictive and made it of limited use. Others commented that the uncertainty of the life span of a time-limited pilot program would minimize uptake of the offering of limited wraparound coverage.

These final regulations generally implement the 2014 proposed regulations with marginal change, as discussed above. Both options are designed so that wraparound coverage could not replace employer-sponsored primary group coverage. Under the individual health insurance wraparound option, the employer also must offer other group health coverage that is not limited to excepted benefits and provides minimum value to the class of participants offered the wraparound coverage by reason of their employment. Only individuals who are not full-time employees and who are eligible for other group health plan coverage may be eligible for the wraparound coverage. Also, the employer coverage must substantially satisfy the employer shared responsibility provisions of Code section 4980H(a), and the coverage would have to be affordable for at least 95 percent of full-time employees.

Under the Multi-State Plan wraparound option, the employer would have to offer coverage in the plan year beginning in 2013 or 2014 that would have substantially satisfied the employer shared responsibility provisions of Code section 4980H(a) if the provision had been applicable, provided minimum value, and been affordable for a substantial portion of its full-time employees.31 The employer's annual contributions for both its primary and wraparound coverage must be substantial.

31 The substantial level was included to help minimize the implications for the primary plan's risk pool by preventing a large number of low-wage workers from leaving the primary plan for Exchange coverage.

The final regulations permit limited wraparound coverage to be excepted benefits if initially offered between January 1, 2016 and December 31, 2018, and continuing for the longer of three years or the date on which the last collective bargaining agreement relating to the group health plan terminates. In addition, the maximum benefit cannot exceed the greater of the annual health FSA contribution limit ($2,550 for 2015), indexed; or 15 percent of the firm's primary plan cost. In the 2014 proposed regulations the maximum benefit was the annual health FSA contribution limits ($2,550 for 2015), indexed.

As with the 2014 proposed regulations, the decision to offer the limited wraparound coverage remains optional. There is greater administrative complexity associated with the wraparound coverage than primary coverage alone or primary coverage plus a health FSA which offers similar benefits. Given a choice, some plan sponsors may choose to increase the affordability of their primary coverage rather than offer limited wraparound coverage. Some plan sponsors may not have that choice: The employers may not be in a financial position to make their primary health plans affordable to more workers, let alone contribute to wraparound coverage. Employers may also continue to simply not provide employees with affordable, minimum value coverage, allowing their workers to purchase coverage and potentially qualify for premium tax credits through an Exchange with no additional wraparound benefit, and these employers would continue to make any employer shared responsibility payments as applicable, resulting in no additional cost to the employer or the Federal government.

The option to offer limited wraparound coverage would not encumber any currently existing means by which employers can provide comprehensive health insurance coverage to their employees in compliance with the Affordable Care Act. Rather, it would clarify two additional, alternative means of doing so.

For the foregoing reasons, the Departments have reached the conclusion that the impact of the benefits, costs, and transfers will be limited. The Departments do not expect many plans to offer limited wraparound coverage, and will monitor usage and impact during the pilot program through reporting, as discussed above.

C. Paperwork Reduction Act—Department of Labor and Department of the Treasury

These final regulations are not subject to the requirements of the Paperwork Reduction Act of 1995 (PRA 95) (44 U.S.C. 3501 et seq.), because it does not contain a collection of information as defined in 44 U.S.C. 3502(3).

D. Paperwork Reduction Act—Department of HHS

The final rule is not subject to the requirements of the Paperwork Reduction Act of 1995 (PRA 95) (44 U.S.C. 3501 et seq.), because it does not contain a collection of information as defined in 44 U.S.C. 3502(3). An analysis under the PRA will be conducted in the future for any future guidance establishing a collection of information related to the rule.

E. Regulatory Flexibility Act—Departments of Labor and HHS

The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) (RFA) imposes certain requirements with respect to Federal rules that are subject to the notice and comment requirements of section 553(b) of the Administrative Procedure Act (5 U.S.C. 551 et seq.) and that are likely to have a significant economic impact on a substantial number of small entities. Unless an agency certifies that a proposed rule is not likely to have a significant economic impact on a substantial number of small entities, section 603 of RFA requires that the agency present an initial regulatory flexibility analysis at the time of the publication of the notice of proposed rulemaking describing the impact of the rule on small entities and seeking public comment on such impact. Small entities include small businesses, organizations and governmental jurisdictions.

For purposes of the RFA, the Departments continue to consider a “small entity” to be an employee benefit plan with fewer than 100 participants. The basis for this definition is found in section 104(a)(2) of the act, which permits the Secretary of Labor to prescribe simplified annual reports for pension plans that cover fewer than 100 participants. Pursuant to the authority of section 104(a)(3), the Department has previously issued at 29 CFR 2520.104-20, 2520.104-21, 2520.104-41, 2520.104-46 and 2520.104b-10 certain simplified reporting provisions and limited exemptions from reporting and disclosure requirements for small plans, including unfunded or insured welfare plans covering fewer than 100 participants and satisfying certain other requirements.

Further, while some large employers may have small plans, in general small employers maintain most small plans. Thus, the Departments believe that assessing the impact of these final regulations on small plans is an appropriate substitute for evaluating the effect on small entities. The definition of small entity considered appropriate for this purpose differs, however, from a definition of small business that is based on size standards promulgated by the Small Business Administration (13 CFR 121.201) pursuant to the Small Business Act (15 U.S.C. 631 et seq.). The Departments requested comment on the appropriateness of the size standard at the proposed rule phase and received no responses.

Because these final regulations impose no additional costs on employers or plans, the Departments believe that they do not have a significant economic impact on a substantial number of small entities. Accordingly, pursuant to section 605(b) of the RFA, the Departments hereby certify that these final regulations will not have a significant economic impact on a substantial number of small entities.

F. Special Analyses—Department of the Treasury

For purposes of the Department of the Treasury it has been determined that this final rule is not a significant regulatory action as defined in Executive Order 12866, as supplemented by Executive Order 13563. Therefore, a regulatory assessment is not required. It has also been determined that section 553(b) of the Administrative Procedure Act (5 U.S.C. chapter 5) does not apply to these final regulations, and, because these final regulations do not impose a collection of information on small entities, an analysis under the RFA is not required. Pursuant to section 7805(f) of the Code, the notice of proposed rulemaking preceding these final regulations was submitted to the Small Business Administration for comment on its impact on small business.

G. Unfunded Mandates Reform Act

For purposes of the Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1501 et seq.), as well as Executive Order 12875, these final regulations do not include any federal mandate that may result in expenditures by State, local, or tribal governments, or the private sector, which may impose an annual burden of $100 million adjusted for inflation since 1995.

H. Federalism

Executive Order 13132 outlines fundamental principles of federalism. It requires adherence to specific criteria by federal agencies in formulating and implementing policies that have “substantial direct effects” on the states, the relationship between the national government and states, or on the distribution of power and responsibilities among the various levels of government. Federal agencies promulgating regulations that have these federalism implications must consult with state and local officials, and describe the extent of their consultation and the nature of the concerns of state and local officials in the preamble to the final regulation.

In the Departments' view, the final regulations, by clarifying policy regarding certain expected benefits options that can be designed by employers to support their employees, will provide more certainty to employers and others in the regulated community as well as states and political subdivisions regarding the treatment of such arrangements under ERISA. Accordingly, the Departments will continue to affirmatively engage in outreach with officials of state and political subdivisions regarding excepted benefits and seek their input on any federalism implications that they believe may be presented.

I. Congressional Review Act

These final regulations are subject to the Congressional Review Act provisions of the Small Business Regulatory Enforcement Fairness Act of 1996 (5 U.S.C. 801 et seq.), which specifies that, before a rule can take effect, the Federal agency promulgating the rule shall submit to each House of the Congress and to the Comptroller General a report containing a copy of the rule along with other specified information. These final regulations are being transmitted to Congress and the Comptroller General for review.

IV. Statutory Authority

The Department of the Treasury regulations are adopted pursuant to the authority contained in sections 7805 and 9833 of the Code.

The Department of Labor regulations are adopted pursuant to the authority contained in 29 U.S.C. 1027, 1059, 1135, 1161-1168, 1169, 1181-1183, 1181 note, 1185, 1185a, 1185b, 1191, 1191a, 1191b, and 1191c; sec. 101(g), Public Law 104-191, 110 Stat. 1936; sec. 401(b), Public Law 105-200, 112 Stat. 645 (42 U.S.C. 651 note); sec. 512(d), Public Law 110-343, 122 Stat. 3765; Public Law 110-460, 122 Stat. 5123; Secretary of Labor's Order 1-2011, 77 FR 1088 (January 9, 2012).

The Department of Health and Human Services regulations are adopted pursuant to the authority contained in sections 2701 through 2763, 2791, and 2792 of the PHS Act (42 U.S.C. 300gg through 300gg-63, 300gg-91, and 300gg-92), as amended.

List of Subjects 26 CFR Part 54

Excise taxes, Health care, Health insurance, Pensions, Reporting and recordkeeping requirements.

29 CFR Part 2590

Continuation coverage, Disclosure, Employee benefit plans, Group health plans, Health care, Health insurance, Medical child support, Reporting and recordkeeping requirements.

45 CFR Part 146

Health care, Health insurance, Reporting and recordkeeping requirements, and State regulation of health insurance.

John M. Dalrymple, Deputy Commissioner for Services and Enforcement, Internal Revenue Service. Approved: March 11, 2015. Mark J. Mazur, Assistant Secretary of the Treasury (Tax Policy). Signed this 11th day of March, 2015. Phyllis C. Borzi, Assistant Secretary, Employee Benefits Security Administration, Department of Labor. Dated: March 11, 2015. Andrew M. Slavitt, Acting Administrator, Centers for Medicare & Medicaid Services. Dated: March 11, 2015. Sylvia Burwell, Secretary, Department of Health and Human Services Department of the Treasury Internal Revenue Service 26 CFR Chapter I

Accordingly, 26 CFR part 54 is amended as follows:

PART 54—PENSION EXCISE TAXES Paragraph 1. The authority citation for part 54 continues to read in part as follows: Authority:

Authority: 26 U.S.C. 7805. * * *

Section 54.9831-1 also issued under 26 U.S.C. 9833; * * *

Par 2. Section 54.9831-1 is amended by adding paragraph (c)(3)(vii) to read as follows:
§ 54.9831-1 Special rules relating to group health plans.

(c) * * *

(3) * * *

(vii) Limited wraparound coverage. Limited benefits provided through a group health plan that wrap around eligible individual health insurance (or Basic Health Plan coverage described in section 1331 of the Patient Protection and Affordable Care Act); or that wrap around coverage under a Multi-State Plan described in section 1334 of the Patient Protection and Affordable Care Act, collectively referred to as “limited wraparound coverage,” are excepted benefits if all of the following conditions are satisfied. For this purpose, eligible individual health insurance is individual health insurance coverage that is not a grandfathered health plan (as described in section 1251 of the Patient Protection and Affordable Care Act and 29 CFR 2590.715-1251), not a transitional individual health insurance plan (as described in the March 5, 2014 Insurance Standards Bulletin Series—Extension of Transitional Policy through October 1, 2016), and does not consist solely of excepted benefits (as defined in paragraph (c) of this section).

(A) Covers additional benefits. The limited wraparound coverage provides meaningful benefits beyond coverage of cost sharing under either the eligible individual health insurance, Basic Health Program coverage, or Multi-State Plan coverage. The limited wraparound coverage must not provide benefits only under a coordination-of-benefits provision and must not consist of an account-based reimbursement arrangement.

(B) Limited in amount. The annual cost of coverage per employee (and any covered dependents, as defined in § 54.9801-2) under the limited wraparound coverage does not exceed the greater of the amount determined under either paragraph (c)(3)(vii)(B)(1) or (2) of this section. Making a determination regarding the annual cost of coverage per employee must occur on an aggregate basis relying on sound actuarial principles.

(1) The maximum permitted annual salary reduction contribution toward health flexible spending arrangements, indexed in the manner prescribed under section 125(i)(2). For this purpose, the cost of coverage under the limited wraparound includes both employer and employee contributions towards coverage and is determined in the same manner as the applicable premium is calculated under a COBRA continuation provision.

(2) Fifteen percent of the cost of coverage under the primary plan. For this purpose, the cost of coverage under the primary plan and under the limited wraparound coverage includes both employer and employee contributions towards the coverage and each is determined in the same manner as the applicable premium is calculated under a COBRA continuation provision.

(C) Nondiscrimination. All of the conditions of this paragraph (c)(3)(vii)(C) are satisfied.

(1) No preexisting condition exclusion. The limited wraparound coverage does not impose any preexisting condition exclusion, consistent with the requirements of section 2704 of the PHS Act (incorporated by reference into section 9815) and 29 CFR 2590.715-2704.

(2) No discrimination based on health status. The limited wraparound coverage does not discriminate against individuals in eligibility, benefits, or premiums based on any health factor of an individual (or any dependent of the individual, as defined in § 54.9801-2), consistent with the requirements of section 9802 and section 2705 of the PHS Act (incorporated by reference into section 9815).

(3) No discrimination in favor of highly compensated individuals. Neither the limited wraparound coverage, nor any other group health plan coverage offered by the plan sponsor, fails to comply with section 2716 of the PHS Act (incorporated by reference into section 9815) or fails to be excludible from income for any individual due to the application of section 105(h) (as applicable).

(D) Plan eligibility requirements. Individuals eligible for the wraparound coverage are not enrolled in excepted benefit coverage under paragraph (c)(3)(v) of this section (relating to health FSAs). In addition, the conditions set forth in either paragraph (c)(3)(vii)(D)(1) or (2) of this section are met.

(1) Limited wraparound coverage that wraps around eligible individual insurance for persons who are not full-time employees. Coverage that wraps around eligible individual health insurance (or that wraps around Basic Health Plan coverage) must satisfy all of the conditions of this paragraph (c)(3)(vii)(D)(1).

(i) For each year for which limited wraparound coverage is offered, the employer that is the sponsor of the plan offering limited wraparound coverage, or the employer participating in a plan offering limited wraparound coverage, offers to its full-time employees coverage that is substantially similar to coverage that the employer would need to offer to its full-time employees in order not to be subject to a potential assessable payment under the employer shared responsibility provisions of section 4980H(a), if such provisions were applicable; provides minimum value (as defined in section 36B(c)(2)(C)(ii)); and is reasonably expected to be affordable (applying the safe harbor rules for determining affordability set forth in § 54.4980H-5(e)(2)). If a plan or issuer providing limited wraparound coverage takes reasonable steps to ensure that employers disclose to the plan or issuer necessary information regarding their coverage offered and affordability information, the plan or issuer is permitted to rely on reasonable representations by employers regarding this information, unless the plan or issuer has specific knowledge to the contrary. In the event that the employer that is the sponsor of the plan offering wraparound coverage, or the employer participating in a plan offering wraparound coverage, has no full-time employees for any plan year limited wraparound coverage is offered, the requirement of this paragraph (c)(3)(vii)(D)(1)(i) is considered satisfied.

(ii) Eligibility for the limited wraparound coverage is limited to employees who are reasonably determined at the time of enrollment to not be full-time employees (and their dependents, as defined in § 54.9801-2), or who are retirees (and their dependents, as defined in § 54.9801-2). For this purpose, full-time employees are employees who are reasonably expected to work at least an average of 30 hours per week.

(iii) Other group health plan coverage, not limited to excepted benefits, is offered to the individuals eligible for the limited wraparound coverage. Only individuals eligible for the other group health plan coverage are eligible for the limited wraparound coverage.

(2) Limited coverage that wraps around Multi-State Plan coverage. Coverage that wraps around Multi-State Plan coverage must satisfy all of the conditions of this paragraph (c)(3)(vii)(D)(2). For this purpose, the term “full-time employee” means a “full-time employee” as defined in § 54.4980H-1(a)(21) who is not in a limited non-assessment period for certain employees (as defined in § 54.4980H-1(a)(26)). Moreover, if a plan or issuer providing limited wraparound coverage takes reasonable steps to ensure that employers disclose to the plan or issuer necessary information regarding their coverage offered and contribution levels for 2013 or 2014 (as applicable), and for any year in which limited wraparound coverage is offered, the plan or issuer is permitted to rely on reasonable representations by employers regarding this information, unless the plan or issuer has specific knowledge to the contrary. Consistent with the reporting and evaluation criteria of paragraph (c)(3)(vii)(E) of this section, the Office of Personnel Management may verify that plans and issuers have reasonable mechanisms in place to ensure that contributing employers meet these standards.

(i) The limited wraparound coverage is reviewed and approved by the Office of Personnel Management, consistent with the reporting and evaluation criteria of paragraph (c)(3)(vii)(E) of this section, to provide benefits in conjunction with coverage under a Multi-State Plan authorized under section 1334 of the Patient Protection and Affordable Care Act. The Office of Personnel Management may revoke approval if it determines that continued approval is inconsistent with the reporting and evaluation criteria of paragraph (c)(3)(vii)(E) of this section.

(ii) The employer offered coverage in the plan year that began in either 2013 or 2014 that is substantially similar to coverage that the employer would need to have offered to its full-time employees in order to not be subject to an assessable payment under the employer shared responsibility provisions of section 4980H(a), if such provisions had been applicable. In the event that a plan that offered coverage in 2013 or 2014 has no full-time employees for any plan year limited wraparound coverage is offered, the requirement of this paragraph (c)(3)(vii)(D)(2)(ii) is considered satisfied.

(iii) In the plan year that began in either 2013 or 2014, the employer offered coverage to a substantial portion of full-time employees that provided minimum value (as defined in section 36B(c)(2)(C)(ii)) and was affordable (applying the safe harbor rules for determining affordability set forth in § 54.4980H-5(e)(2)). In the event that the plan that offered coverage in 2013 or 2014 has no full-time employees for any plan year limited wraparound coverage is offered, the requirement of this paragraph (c)(3)(vii)(D)(2)(iii) is considered satisfied.

(iv) For the duration of the pilot program, as described in paragraph (c)(3)(vii)(F) of this section, the employer's annual aggregate contributions for both primary and limited wraparound coverage are substantially the same as the employer's total contributions for coverage offered to full-time employees in 2013 or 2014.

(E) Reporting—(1) Reporting by group health plans and group health insurance issuers. A self-insured group health plan, or a health insurance issuer, offering or proposing to offer limited wraparound coverage in connection with Multi-State Plan coverage pursuant to paragraph (c)(3)(vii)(D)(2) of this section reports to the Office of Personnel Management (OPM), in a form and manner specified in guidance, information OPM reasonably requires to determine whether the plan or issuer qualifies to offer such coverage or complies with the applicable requirements of this section.

(2) Reporting by group health plan sponsors. The plan sponsor of a group health plan offering limited wraparound coverage under paragraph (c)(3)(vii) of this section, must report to the Department of Health and Human Services (HHS), in a form and manner specified in guidance, information HHS reasonably requires.

(F) Pilot program with sunset. The provisions of paragraph (c)(3)(vii) of this section apply to limited wraparound coverage that is first offered no earlier than January 1, 2016 and no later than December 31, 2018 and that ends no later than on the later of:

(1) The date that is three years after the date limited wraparound coverage is first offered; or

(2) The date on which the last collective bargaining agreement relating to the plan terminates after the date limited wraparound coverage is first offered (determined without regard to any extension agreed to after the date limited wraparound coverage is first offered).

Department of Labor Employee Benefits Security Administration 29 CFR Chapter XXV

For the reasons stated in the preamble, the Department of Labor amends 29 CFR part 2590 as follows:

PART 2590—RULES AND REGULATIONS FOR GROUP HEALTH PLANS 3. The authority citation for Part 2590 continues to read as follows: Authority:

29 U.S.C. 1027, 1059, 1135, 1161-1168, 1169, 1181-1183, 1181 note, 1185, 1185a, 1185b, 1185c, 1185d, 1191, 1191a, 1191b, and 1191c; sec. 101(g), Pub. L. 104-191, 110 Stat. 1936; sec. 401(b), Pub. L. 105-200, 112 Stat. 645 (42 U.S.C. 651 note); sec. 512(d), Pub. L. 110-343, 122 Stat. 3765; Pub. L. 110-460, 122 Stat. 5123; Secretary of Labor's Order 1-2011, 77 FR 1088 (January 9, 2012).

4. Section 2590.732 is amended by adding paragraph (c)(3)(vii) to read as follows:
§ 2590.732 Special rules relating to group health plans.

(c) * * *

(3) * * *

(vii) Limited wraparound coverage. Limited benefits provided through a group health plan that wrap around eligible individual health insurance (or Basic Health Plan coverage described in section 1331 of the Patient Protection and Affordable Care Act); or that wrap around coverage under a Multi-State Plan described in section 1334 of the Patient Protection and Affordable Care Act, collectively referred to as “limited wraparound coverage,” are excepted benefits if all of the following conditions are satisfied. For this purpose, eligible individual health insurance is individual health insurance coverage that is not a grandfathered health plan (as described in section 1251 of the Patient Protection and Affordable Care Act and § 2590.715-1251), not a transitional individual health insurance plan (as described in the March 5, 2014 Insurance Standards Bulletin Series—Extension of Transitional Policy through October 1, 2016), and does not consist solely of excepted benefits (as defined in paragraph (c) of this section).

(A) Covers additional benefits. The limited wraparound coverage provides meaningful benefits beyond coverage of cost sharing under either the eligible individual health insurance, Basic Health Program coverage, or Multi-State Plan coverage. The limited wraparound coverage must not provide benefits only under a coordination-of-benefits provision and must not consist of an account-based reimbursement arrangement.

(B) Limited in amount. The annual cost of coverage per employee (and any covered dependents, as defined in § 2590.701-2) under the limited wraparound coverage does not exceed the greater of the amount determined under either paragraph (c)(3)(vii)(B)(1) or (2) of this section. Making a determination regarding the annual cost of coverage per employee must occur on an aggregate basis relying on sound actuarial principles.

(1) The maximum permitted annual salary reduction contribution toward health flexible spending arrangements, indexed in the manner prescribed under section 125(i)(2) of the Code. For this purpose, the cost of coverage under the limited wraparound includes both employer and employee contributions towards coverage and is determined in the same manner as the applicable premium is calculated under a COBRA continuation provision.

(2) Fifteen percent of the cost of coverage under the primary plan. For this purpose, the cost of coverage under the primary plan and under the limited wraparound coverage includes both employer and employee contributions towards the coverage and each is determined in the same manner as the applicable premium is calculated under a COBRA continuation provision.

(C) Nondiscrimination. All of the conditions of this paragraph (c)(3)(vii)(C) are satisfied.

(1) No preexisting condition exclusion. The limited wraparound coverage does not impose any preexisting condition exclusion, consistent with the requirements of section 2704 of the PHS Act (incorporated by reference into section 715 of ERISA) and § 2590.715-2704.

(2) No discrimination based on health status. The limited wraparound coverage does not discriminate against individuals in eligibility, benefits, or premiums based on any health factor of an individual (or any dependent of the individual, as defined in § 2590.701-2), consistent with the requirements of section 702 of ERISA and section 2705 of the PHS Act (incorporated by reference into section 715 of ERISA).

(3) No discrimination in favor of highly compensated individuals. Neither the limited wraparound coverage, nor any other group health plan coverage offered by the plan sponsor, fails to comply with section 2716 of the PHS Act (incorporated by reference into section 715 of ERISA) or fails to be excludible from income for any individual due to the application of section 105(h) of the Code (as applicable).

(D) Plan eligibility requirements. Individuals eligible for the wraparound coverage are not enrolled in excepted benefit coverage under paragraph (c)(3)(v) of this section (relating to health FSAs). In addition, the conditions set forth in either paragraph (c)(3)(vii)(D)(1) or (2) of this section are met.

(1) Limited wraparound coverage that wraps around eligible individual insurance for persons who are not full-time employees. Coverage that wraps around eligible individual health insurance (or that wraps around Basic Health Plan coverage) must satisfy all of the conditions of this paragraph (c)(3)(vii)(D)(1).

(i) For each year for which limited wraparound coverage is offered, the employer that is the sponsor of the plan offering limited wraparound coverage, or the employer participating in a plan offering limited wraparound coverage, offers to its full-time employees coverage that is substantially similar to coverage that the employer would need to offer to its full-time employees in order not to be subject to a potential assessable payment under the employer shared responsibility provisions of section 4980H(a) of the Code, if such provisions were applicable; provides minimum value (as defined in section 36B(c)(2)(C)(ii) of the Code); and is reasonably expected to be affordable (applying the safe harbor rules for determining affordability set forth in 26 CFR 54.4980H-5(e)(2)). If a plan or issuer providing limited wraparound coverage takes reasonable steps to ensure that employers disclose to the plan or issuer necessary information regarding their coverage offered and affordability information, the plan or issuer is permitted to rely on reasonable representations by employers regarding this information, unless the plan or issuer has specific knowledge to the contrary. In the event that the employer that is the sponsor of the plan offering wraparound coverage, or the employer participating in a plan offering wraparound coverage, has no full-time employees for any plan year limited wraparound coverage is offered, the requirement of this paragraph (c)(3)(vii)(D)(1)(i) is considered satisfied.

(ii) Eligibility for the limited wraparound coverage is limited to employees who are reasonably determined at the time of enrollment to not be full-time employees (and their dependents, as defined in § 2590.701-2), or who are retirees (and their dependents, as defined in § 2590.701-2). For this purpose, full-time employees are employees who are reasonably expected to work at least an average of 30 hours per week.

(iii) Other group health plan coverage, not limited to excepted benefits, is offered to the individuals eligible for the limited wraparound coverage. Only individuals eligible for the other group health plan coverage are eligible for the limited wraparound coverage.

(2) Limited coverage that wraps around Multi-State Plan coverage. Coverage that wraps around Multi-State Plan coverage must satisfy all of the conditions of this paragraph (c)(3)(vii)(D)(2). For this purpose, the term “full-time employee” means a “full-time employee” as defined in 26 CFR 54.4980H-1(a)(21) who is not in a limited non-assessment period for certain employees (as defined in 26 CFR 54.4980H-1(a)(26)). Moreover, if a plan or issuer providing limited wraparound coverage takes reasonable steps to ensure that employers disclose to the plan or issuer necessary information regarding their coverage offered and contribution levels for 2013 or 2014 (as applicable), and for any year in which limited wraparound coverage is offered, the plan or issuer is permitted to rely on reasonable representations by employers regarding this information, unless the plan or issuer has specific knowledge to the contrary. Consistent with the reporting and evaluation criteria of paragraph (c)(3)(vii)(E) of this section, the Office of Personnel Management may verify that plans and issuers have reasonable mechanisms in place to ensure that contributing employers meet these standards.

(i) The limited wraparound coverage is reviewed and approved by the Office of Personnel Management, consistent with the reporting and evaluation criteria of paragraph (c)(3)(vii)(E) of this section, to provide benefits in conjunction with coverage under a Multi-State Plan authorized under section 1334 of the Patient Protection and Affordable Care Act. The Office of Personnel Management may revoke approval if it determines that continued approval is inconsistent with the reporting and evaluation criteria of paragraph (c)(3)(vii)(E) of this section.

(ii) The employer offered coverage in the plan year that began in either 2013 or 2014 that is substantially similar to coverage that the employer would need to have offered to its full-time employees in order to not be subject to an assessable payment under the employer shared responsibility provisions of section 4980H(a) of the Code, if such provisions had been applicable. In the event that a plan that offered coverage in 2013 or 2014 has no full-time employees for any plan year limited wraparound coverage is offered, the requirement of this paragraph (c)(3)(vii)(D)(2)(ii) is considered satisfied.

(iii) In the plan year that began in either 2013 or 2014, the employer offered coverage to a substantial portion of full-time employees that provided minimum value (as defined in section 36B(c)(2)(C)(ii) of the Code) and was affordable (applying the safe harbor rules for determining affordability set forth in 26 CFR 54.4980H-5(e)(2)). In the event that the plan that offered coverage in 2013 or 2014 has no full-time employees for any plan year limited wraparound coverage is offered, the requirement of this paragraph (c)(3)(vii)(D)(2)(iii) is considered satisfied.

(iv) For the duration of the pilot program, as described in paragraph (c)(3)(vii)(F) of this section, the employer's annual aggregate contributions for both primary and limited wraparound coverage are substantially the same as the employer's total contributions for coverage offered to full-time employees in 2013 or 2014.

(E) Reporting—(1) Reporting by group health plans and group health insurance issuers. A self-insured group health plan, or a health insurance issuer, offering or proposing to offer limited wraparound coverage in connection with Multi-State Plan coverage pursuant to paragraph (c)(3)(vii)(D)(2) of this section reports to the Office of Personnel Management (OPM), in a form and manner specified in guidance, information OPM reasonably requires to determine whether the plan or issuer qualifies to offer such coverage or complies with the applicable requirements of this section.

(2) Reporting by group health plan sponsors. The plan sponsor of a group health plan offering limited wraparound coverage under paragraph (c)(3)(vii) of this section, must report to the Department of Health and Human Services (HHS), in a form and manner specified in guidance, information HHS reasonably requires.

(F) Pilot program with sunset—The provisions of paragraph (c)(3)(vii) of this section apply to limited wraparound coverage that is first offered no earlier than January 1, 2016 and no later than December 31, 2018 and that ends no later than on the later of:

(1) The date that is three years after the date limited wraparound coverage is first offered; or

(2) The date on which the last collective bargaining agreement relating to the plan terminates after the date limited wraparound coverage is first offered (determined without regard to any extension agreed to after the date limited wraparound coverage is first offered).

Department of Health and Human Services 45 CFR Subtitle A

For the reasons stated in the preamble, the Department of Health and Human Services amends 45 CFR part 146 as set forth below:

PART 146—REQUIREMENTS FOR THE GROUP HEALTH INSURANCE MARKET 5. The authority citation for part 146 continues to read as follows: Authority:

Secs. 2702 through 2705, 2711 through 2723, 2791, and 2792 of the PHS Act (42 U.S.C. 300gg-1 through 300gg-5, 300gg-11 through 300gg-23, 300gg-91, and 300gg-92).

6. Section 146.145 is amended by adding paragraph (b)(3)(vii) to read as follows:
§ 146.145 Special rules relating to group health plans.

(b) * * *

(3) * * *

(vii) Limited wraparound coverage. Limited benefits provided through a group health plan that wrap around eligible individual health insurance (or Basic Health Plan coverage described in section 1331 of the Patient Protection and Affordable Care Act); or that wrap around coverage under a Multi-State Plan described in section 1334 of the Patient Protection and Affordable Care Act, collectively referred to as “limited wraparound coverage,” are excepted benefits if all of the following conditions are satisfied. For this purpose, eligible individual health insurance is individual health insurance coverage that is not a grandfathered health plan (as described in section 1251 of the Patient Protection and Affordable Care Act and § 147.140 of this subchapter), not a transitional individual health insurance plan (as described in the March 5, 2014 Insurance Standards Bulletin Series—Extension of Transitional Policy through October 1, 2016), and does not consist solely of excepted benefits (as defined in paragraph (b) of this section).

(A) Covers additional benefits. The limited wraparound coverage provides meaningful benefits beyond coverage of cost sharing under either the eligible individual health insurance, Basic Health Program coverage, or Multi-State Plan coverage. The limited wraparound coverage must not provide benefits only under a coordination-of-benefits provision and must not consist of an account-based reimbursement arrangement.

(B) Limited in amount. The annual cost of coverage per employee (and any covered dependents, as defined in § 144.103 of this subchapter) under the limited wraparound coverage does not exceed the greater of the amount determined under either paragraph (b)(3)(vii)(B)(1) or (2) of this section. Making a determination regarding the annual cost of coverage per employee must occur on an aggregate basis relying on sound actuarial principles.

(1) The maximum permitted annual salary reduction contribution toward health flexible spending arrangements, indexed in the manner prescribed under section 125(i)(2) of the Internal Revenue Code. For this purpose, the cost of coverage under the limited wraparound includes both employer and employee contributions towards coverage and is determined in the same manner as the applicable premium is calculated under a COBRA continuation provision.

(2) Fifteen percent of the cost of coverage under the primary plan. For this purpose, the cost of coverage under the primary plan and under the limited wraparound coverage includes both employer and employee contributions towards the coverage and each is determined in the same manner as the applicable premium is calculated under a COBRA continuation provision.

(C) Nondiscrimination. All of the conditions of this paragraph (b)(3)(vii)(C) are satisfied.

(1) No preexisting condition exclusion. The limited wraparound coverage does not impose any preexisting condition exclusion, consistent with the requirements of section 2704 of the PHS Act and § 147.108 of this subchapter.

(2) No discrimination based on health status. The limited wraparound coverage does not discriminate against individuals in eligibility, benefits, or premiums based on any health factor of an individual (or any dependent of the individual, as defined in § 144.103 of this subchapter), consistent with the requirements of section 2705 of the PHS Act.

(3) No discrimination in favor of highly compensated individuals. Neither the limited wraparound coverage, nor any other group health plan coverage offered by the plan sponsor, fails to comply with section 2716 of the PHS Act or fails to be excludible from income for any individual due to the application of section 105(h) of the Internal Revenue Code (as applicable).

(D) Plan eligibility requirements. Individuals eligible for the wraparound coverage are not enrolled in excepted benefit coverage under paragraph (b)(3)(v) of this section (relating to health FSAs). In addition, the conditions set forth in either paragraph (b)(3)(vii)(D)(1) or (2) of this section are met.

(1) Limited wraparound coverage that wraps around eligible individual insurance for persons who are not full-time employees. Coverage that wraps around eligible individual health insurance (or that wraps around Basic Health Plan coverage) must satisfy all of the conditions of this paragraph (b)(3)(vii)(D)(1).

(i) For each year for which limited wraparound coverage is offered, the employer that is the sponsor of the plan offering limited wraparound coverage, or the employer participating in a plan offering limited wraparound coverage, offers to its full-time employees coverage that is substantially similar to coverage that the employer would need to offer to its full-time employees in order not to be subject to a potential assessable payment under the employer shared responsibility provisions of section 4980H(a) of the Internal Revenue Code, if such provisions were applicable; provides minimum value (as defined in section 36B(c)(2)(C)(ii) of the Internal Revenue Code); and is reasonably expected to be affordable (applying the safe harbor rules for determining affordability set forth in 26 CFR 54.4980H-5(e)(2)). If a plan or issuer providing limited wraparound coverage takes reasonable steps to ensure that employers disclose to the plan or issuer necessary information regarding their coverage offered and affordability information, the plan or issuer is permitted to rely on reasonable representations by employers regarding this information, unless the plan or issuer has specific knowledge to the contrary. In the event that the employer that is the sponsor of the plan offering wraparound coverage, or the employer participating in a plan offering wraparound coverage, has no full-time employees for any plan year limited wraparound coverage is offered, the requirement of this paragraph (b)(3)(vii)(D)(1)(i) is considered satisfied.

(ii) Eligibility for the limited wraparound coverage is limited to employees who are reasonably determined at the time of enrollment to not be full-time employees (and their dependents, as defined in § 144.103 of this subchapter), or who are retirees (and their dependents, as defined in § 144.103 of this subchapter). For this purpose, full-time employees are employees who are reasonably expected to work at least an average of 30 hours per week.

(iii) Other group health plan coverage, not limited to excepted benefits, is offered to the individuals eligible for the limited wraparound coverage. Only individuals eligible for the other group health plan coverage are eligible for the limited wraparound coverage.

(2) Limited coverage that wraps around Multi-State Plan coverage. Coverage that wraps around Multi-State Plan coverage must satisfy all of the conditions of this paragraph (b)(3)(vii)(D)(2). For this purpose, the term “full-time employee” means a “full-time employee” as defined in 26 CFR 54.4980H-1(a)(21) who is not in a limited non-assessment period for certain employees (as defined in 26 CFR 54.4980H-1(a)(26)). Moreover, if a plan or issuer providing limited wraparound coverage takes reasonable steps to ensure that employers disclose to the plan or issuer necessary information regarding their coverage offered and contribution levels for 2013 or 2014 (as applicable), and for any year in which limited wraparound coverage is offered, the plan or issuer is permitted to rely on reasonable representations by employers regarding this information, unless the plan or issuer has specific knowledge to the contrary. Consistent with the reporting and evaluation criteria of paragraph (b)(3)(vii)(E) of this section, the Office of Personnel Management may verify that plans and issuers have reasonable mechanisms in place to ensure that contributing employers meet these standards.

(i) The limited wraparound coverage is reviewed and approved by the Office of Personnel Management, consistent with the reporting and evaluation criteria of paragraph (b)(3)(vii)(E) of this section, to provide benefits in conjunction with coverage under a Multi-State Plan authorized under section 1334 of the Patient Protection and Affordable Care Act. The Office of Personnel Management may revoke approval if it determines that continued approval is inconsistent with the reporting and evaluation criteria of paragraph (b)(3)(vii)(E) of this section.

(ii) The employer offered coverage in the plan year that began in either 2013 or 2014 that is substantially similar to coverage that the employer would need to have offered to its full-time employees in order to not be subject to an assessable payment under the employer shared responsibility provisions of section 4980H(a) of the Internal Revenue Code, if such provisions had been applicable. In the event that a plan that offered coverage in 2013 or 2014 has no full-time employees for any plan year limited wraparound coverage is offered, the requirement of this paragraph (b)(3)(vii)(D)(2)(ii) is considered satisfied.

(iii) In the plan year that began in either 2013 or 2014, the employer offered coverage to a substantial portion of full-time employees that provided minimum value (as defined in section 36B(c)(2)(C)(ii) of the Internal Revenue Code) and was affordable (applying the safe harbor rules for determining affordability set forth in 26 CFR 54.4980H-5(e)(2)). In the event that the plan that offered coverage in 2013 or 2014 has no full-time employees for any plan year limited wraparound coverage is offered, the requirement of this paragraph (b)(3)(vii)(D)(2)(iii) is considered satisfied.

(iv) For the duration of the pilot program, as described in paragraph (b)(3)(vii)(F) of this section, the employer's annual aggregate contributions for both primary and limited wraparound coverage are substantially the same as the employer's total contributions for coverage offered to full-time employees in 2013 or 2014.

(E) Reporting—(1) Reporting by group health plans and group health insurance issuers. A self-insured group health plan, or a health insurance issuer, offering or proposing to offer limited wraparound coverage in connection with Multi-State Plan coverage pursuant to paragraph (b)(3)(vii)(D)(2) of this section reports to the Office of Personnel Management (OPM), in a form and manner specified in guidance, information OPM reasonably requires to determine whether the plan or issuer qualifies to offer such coverage or complies with the applicable requirements of this section.

(2) Reporting by group health plan sponsors. The plan sponsor of a group health plan offering limited wraparound coverage under paragraph (b)(3)(vii) of this section, must report to the Department of Health and Human Services (HHS), in a form and manner specified in guidance, information HHS reasonably requires.

(F) Pilot program with sunset—The provisions of paragraph (b)(3)(vii) of this section apply to limited wraparound coverage that is first offered no earlier than January 1, 2016 and no later than December 31, 2018 and that ends no later than on the later of:

(1) The date that is three years after the date limited wraparound coverage is first offered; or

(2) The date on which the last collective bargaining agreement relating to the plan terminates after the date limited wraparound coverage is first offered (determined without regard to any extension agreed to after the date limited wraparound coverage is first offered).

[FR Doc. 2015-06066 Filed 3-16-15; 11:15 am] BILLING CODE 4830-01-P; 4510-29-P; 4120-01-P
DEPARTMENT OF HOMELAND SECURITY Coast Guard 33 CFR Part 165 [Docket Number USCG-2013-0907] RIN 1625-AA00 Safety Zones; Upper Mississippi River Between Mile 38.0 and 46.0, Thebes, IL; and Between Mile 78.0 and 81.0, Grand Tower, IL. AGENCY:

Coast Guard, DHS.

ACTION:

Final rule; correction.

SUMMARY:

The Coast Guard published in the Federal Register of March 5, 2015, a final rule document making final an interim rule previously published at 79 FR 66622 on November 10, 2014. The March 5 final rule incorrectly cited the interim rule as published at 77 FR 75850 on December 26, 2012. This document corrects the citation and date in that final rule to correctly reflect the proper interim rule citation and effective date.

DATES:

Effective on March 18, 2015.

FOR FURTHER INFORMATION CONTACT:

If you have questions on this rule, call or email LT Dan McQuate, U.S. Coast Guard; telephone 270-442-1621, email [email protected] If you have questions on viewing or submitting material to the docket, call Cheryl F. Collins, Program Manager, Docket Operations, telephone (202) 366-9826.

SUPPLEMENTARY INFORMATION:

The Coast Guard published a document in the Federal Register of March 5, 2015 making an interim rule final as published. The citation to the interim rule was published incorrectly. This correction removes the incorrect citation and amendatory instruction for 33 CFR part 165.

In rule FR Doc. 2015-03331 published on March 5, 2015 (80 FR 11885), make the following correction. On page 11887, in the third column, correct the last full paragraph of the document to read as follows: Accordingly, the interim rule amending 33 CFR part 165 that published at 79 FR 66622 on November 10, 2014, is adopted as a final rule without change.

Dated: March 12, 2015. Katia Cervoni, Chief, Office of Regulations and Administrative Law, U.S. Coast Guard.
[FR Doc. 2015-06174 Filed 3-17-15; 8:45 am] BILLING CODE 9110-04-P
ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 180 [EPA-HQ-OPP-2013-0797; FRL-9921-01] Boscalid; Pesticide Tolerances AGENCY:

Environmental Protection Agency (EPA).

ACTION:

Final rule.

SUMMARY:

This regulation establishes tolerances for residues of boscalid in or on dill seed, the herb subgroup 19A, the stone fruit group 12-12, and the tree nut group 14-12. Interregional Research Project Number 4 (IR-4) requested these tolerances under the Federal Food, Drug, and Cosmetic Act (FFDCA). In addition, this regulation removes established tolerances for certain commodities/groups superseded by this action, and corrects the spelling of papaya.

DATES:

This regulation is effective March 18, 2015. Objections and requests for hearings must be received on or before May 18, 2015, and must be filed in accordance with the instructions provided in 40 CFR part 178 (see also Unit I.C. of the SUPPLEMENTARY INFORMATION).

ADDRESSES:

The docket for this action, identified by docket identification (ID) number EPA-HQ-OPP-2013-0797, is available at http://www.regulations.gov or at the Office of Pesticide Programs Regulatory Public Docket (OPP Docket) in the Environmental Protection Agency Docket Center (EPA/DC), West William Jefferson Clinton Bldg., Rm. 3334, 1301 Constitution Ave. NW., Washington, DC 20460-0001. The Public Reading Room is open from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding legal holidays. The telephone number for the Public Reading Room is (202) 566-1744, and the telephone number for the OPP Docket is (703) 305-5805. Please review the visitor instructions and additional information about the docket available at http://www.epa.gov/dockets.

FOR FURTHER INFORMATION CONTACT:

Susan Lewis, Registration Division (7505P), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave. NW., Washington, DC 20460-0001; main telephone number: (703) 305-7090; email address: [email protected]

SUPPLEMENTARY INFORMATION:

I. General Information A. Does this action apply to me?

You may be potentially affected by this action if you are an agricultural producer, food manufacturer, or pesticide manufacturer. The following list of North American Industrial Classification System (NAICS) codes is not intended to be exhaustive, but rather provides a guide to help readers determine whether this document applies to them. Potentially affected entities may include:

• Crop production (NAICS code 111).

• Animal production (NAICS code 112).

• Food manufacturing (NAICS code 311).

• Pesticide manufacturing (NAICS code 32532).

B. How can I get electronic access to other related information?

You may access a frequently updated electronic version of EPA's tolerance regulations at 40 CFR part 180 through the Government Publishing Office's e-CFR site at http://www.ecfr.gov/cgi-bin/text-idx?&c=ecfr&tpl=/ecfrbrowse/Title40/40tab_02.tpl.

C. How can I file an objection or hearing request?

Under FFDCA section 408(g), 21 U.S.C. 346a, any person may file an objection to any aspect of this regulation and may also request a hearing on those objections. You must file your objection or request a hearing on this regulation in accordance with the instructions provided in 40 CFR part 178. To ensure proper receipt by EPA, you must identify docket ID number EPA-HQ-OPP-2013-0797 in the subject line on the first page of your submission. All objections and requests for a hearing must be in writing, and must be received by the Hearing Clerk on or before May 18, 2015. Addresses for mail and hand delivery of objections and hearing requests are provided in 40 CFR 178.25(b).

In addition to filing an objection or hearing request with the Hearing Clerk as described in 40 CFR part 178, please submit a copy of the filing (excluding any Confidential Business Information (CBI)) for inclusion in the public docket. Information not marked confidential pursuant to 40 CFR part 2 may be disclosed publicly by EPA without prior notice. Submit the non-CBI copy of your objection or hearing request, identified by docket ID number EPA-HQ-OPP-2013-0797, by one of the following methods:

Federal eRulemaking Portal: http://www.regulations.gov. Follow the online instructions for submitting comments. Do not submit electronically any information you consider to be CBI or other information whose disclosure is restricted by statute.

Mail: OPP Docket, Environmental Protection Agency Docket Center (EPA/DC), (28221T), 1200 Pennsylvania Ave. NW., Washington, DC 20460-0001.

Hand Delivery: To make special arrangements for hand delivery or delivery of boxed information, please follow the instructions at http://www.epa.gov/dockets/contacts.html.

Additional instructions on commenting or visiting the docket, along with more information about dockets generally, is available at http://www.epa.gov/dockets.

II. Summary of Petitioned-For Tolerance

In the Federal Register of February 25, 2014 (79 FR 10458) (FRL-9906-77), EPA issued a document pursuant to FFDCA section 408(d)(3), 21 U.S.C. 346a(d)(3), announcing the filing of a pesticide petition (PP 3E8215) by (IR-4), 500 College Road East, Suite 201 W, Princeton, NJ 08540. The petition requested that 40 CFR 180.589 be amended by establishing tolerances for residues of the fungicide boscalid, 3-pyridinecarboxamide,2-chloro-N-(4′-chloro[1,1′-biphenyl]-2-yl), in or on herb, subgroup 19A at 190 parts per million (ppm), and dill, seed at 300 ppm as well as changing the existing tolerance for “fruit, stone, group 12” to “fruit, stone, group 12-12” and “nut, tree, group 14” to “nut, tree, group 14-12” and also removing the existing tolerance for pistachio at 0.70 ppm. That document referenced a summary of the petition prepared by BASF, the registrant, which is available in the docket, http://www.regulations.gov. There were no comments received in response to the notice of filing.

Based upon review of the data supporting the petition, EPA has modified the levels at which some of the tolerances are being established. The reason for these changes are explained in Unit IV.C.

III. Aggregate Risk Assessment and Determination of Safety

Section 408(b)(2)(A)(i) of FFDCA allows EPA to establish a tolerance (the legal limit for a pesticide chemical residue in or on a food) only if EPA determines that the tolerance is “safe.” Section 408(b)(2)(A)(ii) of FFDCA defines “safe” to mean that “there is a reasonable certainty that no harm will result from aggregate exposure to the pesticide chemical residue, including all anticipated dietary exposures and all other exposures for which there is reliable information.” This includes exposure through drinking water and in residential settings, but does not include occupational exposure. Section 408(b)(2)(C) of FFDCA requires EPA to give special consideration to exposure of infants and children to the pesticide chemical residue in establishing a tolerance and to “ensure that there is a reasonable certainty that no harm will result to infants and children from aggregate exposure to the pesticide chemical residue. . . .”

Consistent with FFDCA section 408(b)(2)(D), and the factors specified in FFDCA section 408(b)(2)(D), EPA has reviewed the available scientific data and other relevant information in support of this action. EPA has sufficient data to assess the hazards of and to make a determination on aggregate exposure for boscalid including exposure resulting from the tolerances established by this action. EPA's assessment of exposures and risks associated with boscalid follows.

A. Toxicological Profile

EPA has evaluated the available toxicity data and considered its validity, completeness, and reliability as well as the relationship of the results of the studies to human risk. EPA has also considered available information concerning the variability of the sensitivities of major identifiable subgroups of consumers, including infants and children.

In mammals, the primary targets are the liver and the thyroid (indirectly from liver adaptive response). In subchronic and chronic feeding studies in rats, mice and dogs, boscalid generally caused decreased body weights and decreased body weight gains (primarily in mice) and effects on the liver (increase in weights, changes in enzyme levels and histopathological changes) as well as on the thyroid (increase in weights and histopathological changes). Mode of action studies conducted in rats indicated that boscalid has a direct effect upon the liver and that the thyroid effects are secondary. A reversibility study in rats indicated that both liver and thyroid parameters returned to control values after the animals were placed on control diet. Thyroid weights were elevated in rats and dogs, but there were no histopathological changes observed in the thyroid in either mice or dogs.

In a developmental toxicity study in rats, no developmental toxicity was observed in the fetuses at the highest dose tested (limit dose). No effects were noted in the dams in this study. In a developmental toxicity study in rabbits, an increased incidence of abortions or early delivery was observed at the limit dose. There was quantitative evidence of increased susceptibility in the 2-generation reproduction study in rats, where decreases in body weights and in body weight gains in male offspring were seen at a dose that was lower than the dose that induced parental/systemic toxicity. There was quantitative evidence of increased susceptibility in the developmental neurotoxicity study in rats, where decreases in pup body weights (PND 4) and in body weight gains (PND 1-4) were seen in the absence of any maternal toxicity, however, these effects were shown to be reversible in that no treatment-related effects on body weight, body weight gain or any other parameter were noted at PND 21.

Although there is some evidence indicating increased incidence of thyroid follicular cell adenomas in rats, EPA classified boscalid as “suggestive evidence of carcinogenicity” and has concluded that the endpoint for chronic assessment would be protective of these effects. This is based on the following: the adenomas occurred at dose levels above the level used to establish the chronic population adjusted dose (cPAD), statistically significant increases were only seen for benign tumors (adenomas) and not for malignant ones (carcinomas), the increase in adenomas in females was slight, and there was no evidence of mutagenicity.

There was no evidence of neurotoxicity in rats in the acute, subchronic, or developmental studies up to the limit dose. No neurotoxic observations were noted in any of the other studies in any species.

Specific information on the studies received and the nature of the adverse effects caused by boscalid as well as the no-observed-adverse-effect-level (NOAEL) and the lowest-observed-adverse-effect-level (LOAEL) from the toxicity studies can be found at http://www.regulations.gov in document, “Boscalid—Human Health Risk Assessment for a Section 3 Registration of New Uses on Herb Subgroup 19A and Dill Seed, Plus Crop Group Conversions on Stone Fruit Group 12-12 and Tree Nut Group 14-12” at pg. 35 in docket ID number EPA-HQ-OPP-2013-0797.

B. Toxicological Points of Departure/Levels of Concern

Once a pesticide's toxicological profile is determined, EPA identifies toxicological points of departure (POD) and levels of concern to use in evaluating the risk posed by human exposure to the pesticide. For hazards that have a threshold below which there is no appreciable risk, the toxicological POD is used as the basis for derivation of reference values for risk assessment. PODs are developed based on a careful analysis of the doses in each toxicological study to determine the dose at which the NOAEL and the LOAEL are identified. Uncertainty/safety factors are used in conjunction with the POD to calculate a safe exposure level—generally referred to as a population-adjusted dose (PAD) or a reference dose (RfD)—and a safe margin of exposure (MOE). For non-threshold risks, the Agency assumes that any amount of exposure will lead to some degree of risk. Thus, the Agency estimates risk in terms of the probability of an occurrence of the adverse effect expected in a lifetime. For more information on the general principles EPA uses in risk characterization and a complete description of the risk assessment process, see http://www.epa.gov/pesticides/factsheets/riskassess.htm.

A summary of the toxicological endpoints for boscalid used for human risk assessment is discussed in Unit III.B. of the final rule published in the Federal Register of November 8, 2013 (78 FR 67042) (FRL-9401-5).

C. Exposure Assessment

1. Dietary exposure from food and feed uses. In evaluating dietary exposure to boscalid, EPA considered exposure under the petitioned-for tolerances as well as all existing boscalid tolerances in 40 CFR 180.589. EPA assessed dietary exposures from boscalid in food as follows:

i. Acute exposure. Quantitative acute dietary exposure and risk assessments are performed for a food-use pesticide, if a toxicological study has indicated the possibility of an effect of concern occurring as a result of a 1-day or single exposure.

No such effects were identified in the toxicological studies for boscalid; therefore, a quantitative acute dietary exposure assessment is unnecessary.

ii. Chronic exposure. In conducting the chronic dietary exposure assessment, EPA used the 2003-2008 food consumption data from the U.S. Department of Agriculture's (USDA's) National Health and Nutrition Examination Survey, What We Eat in America, (NHANES/WWEIA). As to residue levels in food, EPA assumed tolerance-level residues and used some percent crop treated (PCT) information as described in Unit III.C.1.iv.

iii. Cancer. Based on the data summarized in Unit III.A., EPA has concluded that the chronic endpoint will be protective of potential cancer effects. EPA's estimate of chronic exposure as described above is relied upon to evaluate whether any exposure could exceed the cPAD and thus pose a cancer risk.

iv. Anticipated residue and PCT information. Section 408(b)(2)(F) of FFDCA states that the Agency may use data on the actual percent of food treated for assessing chronic dietary risk only if:

• Condition a: The data used are reliable and provide a valid basis to show what percentage of the food derived from such crop is likely to contain the pesticide residue.

• Condition b: The exposure estimate does not underestimate exposure for any significant subpopulation group.

• Condition c: Data are available on pesticide use and food consumption in a particular area, the exposure estimate does not understate exposure for the population in such area.

In addition, the Agency must provide for periodic evaluation of any estimates used. To provide for the periodic evaluation of the estimate of PCT as required by FFDCA section 408(b)(2)(F), EPA may require registrants to submit data on PCT.

The Agency estimated the PCT for existing uses as follows: Almonds 40%; apples 15%; apricots 25%; blueberries 35%; broccoli 2.5%; cabbage 5%; caneberries 45%; cantaloupes 5%; carrots 15%; cauliflower 5%; celery 5%; cherries 45%; cucumbers 5%; dry beans/dry peas 2.5%; garlic 5%; grapes 30%; green beans 5%; green peas 1%; hazelnuts 5%; lettuce 25%; nectarines 15%; onions 20%; oranges 1%; peaches 20%; peanuts 1%; pears 15%; peppers 2.5%; pistachios 30%; plums/prunes 5%; potatoes 20%; pumpkins 10%; squash 5%; strawberries 60%; sugar beets 1%; tomatoes 5%; walnuts 1%; and watermelons 25%.

In most cases, EPA uses available data from United States Department of Agriculture/National Agricultural Statistics Service (USDA/NASS), proprietary market surveys, and the National Pesticide Use Database for the chemical/crop combination for the most recent 6-7 years. EPA uses an average PCT for chronic dietary risk analysis. The average PCT figure for each existing use is derived by combining available public and private market survey data for that use, averaging across all observations, and rounding to the nearest 5%, except for those situations in which the average PCT is less than one. In those cases, 1% is used as the average PCT and 2.5% is used as the maximum PCT. EPA uses a maximum PCT for acute dietary risk analysis. The maximum PCT figure is the highest observed maximum value reported within the recent 6 years of available public and private market survey data for the existing use and rounded up to the nearest multiple of 5%.

The Agency believes that the three conditions discussed in Unit III.C.1.iv. have been met. With respect to Condition a, PCT estimates are derived from Federal and private market survey data, which are reliable and have a valid basis. The Agency is reasonably certain that the percentage of the food treated is not likely to be an underestimation. As to Conditions b and c, regional consumption information and consumption information for significant subpopulations is taken into account through EPA's computer-based model for evaluating the exposure of significant subpopulations including several regional groups. Use of this consumption information in EPA's risk assessment process ensures that EPA's exposure estimate does not understate exposure for any significant subpopulation group and allows the Agency to be reasonably certain that no regional population is exposed to residue levels higher than those estimated by the Agency. Other than the data available through national food consumption surveys, EPA does not have available reliable information on the regional consumption of food to which boscalid may be applied in a particular area.

2. Dietary exposure from drinking water. The Agency used screening level water exposure models in the dietary exposure analysis and risk assessment for boscalid in drinking water. These simulation models take into account data on the physical, chemical, and fate/transport characteristics of boscalid. Further information regarding EPA drinking water models used in pesticide exposure assessment can be found at http://www.epa.gov/oppefed1/models/water/index.htm.

Based on the First Index Reservoir Screening Tool (FIRST) and Pesticide Root Zone Model Ground Water (PRZM GW), the estimated drinking water concentrations (EDWCs) of boscalid for chronic exposure assessments are estimated to be 26.4 parts per billion (ppb) for surface water and 697 ppb for ground water.

Modeled estimates of drinking water concentrations were directly entered into the dietary exposure model. For chronic dietary risk assessment, the water concentration of value 697 ppb was used to assess the contribution to drinking water.

3. From non-dietary exposure. The term “residential exposure” is used in this document to refer to non-occupational, non-dietary exposure (e.g., for lawn and garden pest control, indoor pest control, termiticides, and flea and tick control on pets).

Boscalid is currently registered for the following uses that could result in residential exposures: Golf course turf, residential fruit and nut trees, and residential ornamentals and landscape gardens. EPA assessed residential exposure using the following assumptions:

All residential exposures are considered short-term in duration. The residential handler assessment included short-term exposures via the dermal and inhalation routes from treating residential ornamentals, landscape gardens, and trees.

In terms of post-application exposure, there is the potential for dermal post-application exposure for individuals as a result of being in an environment that has been previously treated with boscalid. Short-term dermal exposures were assessed for adults, youth 11 to 16 years old, and children 6 to 11 years old. Incidental oral exposure to children 1 to 2 years old is not expected from treated turf because boscalid is registered for use only on golf course turf and residential gardens and trees.

The scenarios used in the aggregate assessment were those that resulted in the highest exposures. The highest exposures for all age groups were associated with only residential post-application dermal exposures, not inhalation exposures, and consist of the following:

• The residential dermal exposure for use in the adult aggregate assessment reflects dermal exposure from post-application activities on treated gardens.

• The residential dermal exposure for use in the youth (11-16 years old) aggregate assessment reflects dermal exposure from post-application golfing on treated turf.

• The residential dermal exposure for use in the child (6-11 years old) aggregate assessment reflects dermal exposure from post-application activities in treated gardens.

Further information regarding EPA standard assumptions and generic inputs for residential exposures may be found at http://www.epa.gov/pesticides/trac/science/trac6a05.pdf.

4. Cumulative effects from substances with a common mechanism of toxicity. Section 408(b)(2)(D)(v) of FFDCA requires that, when considering whether to establish, modify, or revoke a tolerance, the Agency consider “available information” concerning the cumulative effects of a particular pesticide's residues and “other substances that have a common mechanism of toxicity.”

EPA has not found boscalid to share a common mechanism of toxicity with any other substances, and boscalid does not appear to produce a toxic metabolite produced by other substances. For the purposes of this tolerance action, therefore, EPA has assumed that boscalid does not have a common mechanism of toxicity with other substances. For information regarding EPA's efforts to determine which chemicals have a common mechanism of toxicity and to evaluate the cumulative effects of such chemicals, see EPA's Web site at http://www.epa.gov/pesticides/cumulative.

D. Safety Factor for Infants and Children

1. In general. Section 408(b)(2)(C) of FFDCA provides that EPA shall apply an additional tenfold (10X) margin of safety for infants and children in the case of threshold effects to account for prenatal and postnatal toxicity and the completeness of the database on toxicity and exposure unless EPA determines based on reliable data that a different margin of safety will be safe for infants and children. This additional margin of safety is commonly referred to as the Food Quality Protection Act Safety Factor (FQPA SF). In applying this provision, EPA either retains the default value of 10X, or uses a different additional safety factor when reliable data available to EPA support the choice of a different factor.

2. Prenatal and postnatal sensitivity. There was no evidence of increased susceptibility in the rat developmental study as no developmental toxicity was seen at the highest dose tested (limit dose).

There was evidence of increased qualitative susceptibility in the rabbit developmental study as characterized by an increased incidence of abortions or early delivery at the limit dose. It could not be ascertained if the abortions were the result of a treatment-related effect on the dams, the fetuses or both. It was concluded that the degree of concern is low because the increased abortions or early delivery was seen only at the limit dose and the abortions may have been due to maternal stress.

There was evidence of increased quantitative susceptibility seen in the rat 2-generation reproduction study and the developmental neurotoxicity study, in that reduced body weights were seen in the offspring at dose levels where no parental toxicity was observed. However, the degree of concern is low because the dose selected for chronic dietary and non-dietary exposure risk assessments is lower than the dose that caused the body weight effects, and the effect was shown to be reversible in the developmental neurotoxicity study.

3. Conclusion. EPA has determined that reliable data show the safety of infants and children would be adequately protected if the FQPA SF were reduced to 1x for all scenarios except for inhalation exposures where the 10X FQPA SF was retained. That decision is based on the following findings:

i. The toxicity database is complete, with the exception of a subchronic inhalation study. EPA is retaining a 10X FQPA SF for assessing residential inhalation risks to adult applicators.

ii. For the reasons listed in Unit III.D.2., the Agency has concluded that there are no residual uncertainties concerning the potential for prenatal and post-natal toxicity.

iii There are no residual uncertainties identified in the exposure databases. The dietary food exposure assessment assumed tolerance level residues and was moderately refined using some PCT data. The use of the PCT data for some crops is based on reliable data and will not underestimate the exposure and risk. EPA made conservative (protective) assumptions in the ground and surface water modeling used to assess exposure to boscalid in drinking water. EPA used similarly conservative assumptions to assess post-application exposure of children. These assessments will not underestimate the exposure and risks posed by boscalid.

E. Aggregate Risks and Determination of Safety

EPA determines whether acute and chronic dietary pesticide exposures are safe by comparing aggregate exposure estimates to the acute PAD (aPAD) and chronic PAD (cPAD). For linear cancer risks, EPA calculates the lifetime probability of acquiring cancer given the estimated aggregate exposure. Short-, intermediate-, and chronic-term risks are evaluated by comparing the estimated aggregate food, water, and residential exposure to the appropriate PODs to ensure that an adequate MOE exists.

1. Acute risk. An acute aggregate risk assessment takes into account acute exposure estimates from dietary consumption of food and drinking water. No adverse effect resulting from a single oral exposure was identified and no acute dietary endpoint was selected. Therefore, boscalid is not expected to pose an acute risk.

2. Chronic risk. Using the exposure assumptions described in this unit for chronic exposure, EPA has concluded that chronic exposure to boscalid from food and water will utilize 26% of the cPAD for all infants less than 1 year old, the population group receiving the greatest exposure. Based on the explanation in Unit III.C.3., regarding residential use patterns, chronic residential exposure to residues of boscalid is not expected.

3. Short-term risk. Short-term aggregate exposure takes into account short-term residential exposure plus chronic exposure to food and water (considered to be a background exposure level).

Boscalid is currently registered for uses that could result in short-term residential exposure, and the Agency has determined that it is appropriate to aggregate chronic exposure through food and water with short-term residential exposures to boscalid. EPA used the dermal exposure scenarios mentioned in Unit III.C.3. in the aggregate assessment because those scenarios resulted in the highest exposures and corresponding lowest MOEs.

Using the exposure assumptions described in this unit for short-term exposures, EPA has concluded that the combined short-term food, water, and residential exposures result in aggregate MOEs of 380 for adults, 460 for children 6-11 years old, and 1,100 for youth 11-16 years old. Because EPA's level of concern for boscalid is a MOE of 100 or below, these MOEs are not of concern.

4. Intermediate-term risk. Intermediate-term aggregate exposure takes into account intermediate-term residential exposure plus chronic exposure to food and water (considered to be a background exposure level).

An intermediate-term adverse effect was identified; however, boscalid is not registered for any use patterns that would result in intermediate-term residential exposure. Intermediate-term risk is assessed based on intermediate-term residential exposure plus chronic dietary exposure. Because there is no intermediate-term residential exposure and chronic dietary exposure has already been assessed under the appropriately protective cPAD (which is at least as protective as the POD used to assess intermediate-term risk), no further assessment of intermediate-term risk is necessary, and EPA relies on the chronic dietary risk assessment for evaluating intermediate-term risk for boscalid.

5. Aggregate cancer risk for U.S. population. Based on the data summarized in Unit III.A., EPA has concluded that the cPAD is protective of possible cancer effects. Given the results of the chronic risk assessment, cancer risk resulting from exposure to boscalid is not of concern.

6. Determination of safety. Based on these risk assessments, EPA concludes that there is a reasonable certainty that no harm will result to the general population, or to infants and children from aggregate exposure to boscalid residues.

IV. Other Considerations A. Analytical Enforcement Methodology

Adequate enforcement methodology (gas chromatography/mass spectrometry (GC/MS)) is available to enforce the tolerance expression.

The method may be requested from: Chief, Analytical Chemistry Branch, Environmental Science Center, 701 Mapes Rd., Ft. Meade, MD 20755-5350; telephone number: (410) 305-2905; email address: [email protected]

B. International Residue Limits

In making its tolerance decisions, EPA seeks to harmonize U.S. tolerances with international standards whenever possible, consistent with U.S. food safety standards and agricultural practices. EPA considers the international maximum residue limits (MRLs) established by the Codex Alimentarius Commission (Codex), as required by FFDCA section 408(b)(4). The Codex Alimentarius is a joint United Nations Food and Agriculture Organization/World Health Organization food standards program, and it is recognized as an international food safety standards-setting organization in trade agreements to which the United States is a party. EPA may establish a tolerance that is different from a Codex MRL; however, FFDCA section 408(b)(4) requires that EPA explain the reasons for departing from the Codex level.

The Codex has not established MRLs for herbs or dill seed. For stone fruit, Codex has an MRL of 3 ppm and the U.S. tolerance is 3.5 ppm. The U.S. tolerance cannot be lowered to 3 ppm to harmonize with Codex, because the cherry residue data used in support of the U.S. tolerances necessitate a higher value. The Codex tree nut MRL (0.05 ppm) is lower than the U.S. tolerance (0.7 ppm), and harmonization is not possible.

C. Revisions to Petitioned-For Tolerances

The petitioned for tolerance of 190 ppm for the herb subgroup 19A is not supported by the field trial data and the processing data and therefore, the tolerance is being established at 150 ppm based on the highest average field trial (HAFT) data for basil and the processing factor for drying. The tolerance for dill seed is being established at 100 ppm, not the petitioned for level of 300 ppm, based on an evaluation of the residue data using the Organization for Economic Cooperation and Development (OECD) calculation procedure.

V. Conclusion

Therefore, tolerances are established for residues of boscalid in or on dill, seed at 100 ppm; fruit, stone, group 12-12 at 3.5 ppm; herb subgroup 19A at 150 ppm; and nut, tree, group 14-12 at 0.70 ppm. In addition, due to the establishment of these tolerances, the existing tolerances for fruit, stone, group 12; nut, tree, group 14; and pistachio are removed as unnecessary. Lastly, as an administrative correction, the existing entry for “papya” is changed to its correct spelling “papaya.”

VI. Statutory and Executive Order Reviews

This action establishes tolerances under FFDCA section 408(d) in response to a petition submitted to the Agency. The Office of Management and Budget (OMB) has exempted these types of actions from review under Executive Order 12866, entitled “Regulatory Planning and Review” (58 FR 51735, October 4, 1993). Because this action has been exempted from review under Executive Order 12866, this action is not subject to Executive Order 13211, entitled “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355, May 22, 2001) or Executive Order 13045, entitled “Protection of Children from Environmental Health Risks and Safety Risks” (62 FR 19885, April 23, 1997). This action does not contain any information collections subject to OMB approval under the Paperwork Reduction Act (PRA) (44 U.S.C. 3501 et seq.), nor does it require any special considerations under Executive Order 12898, entitled “Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations” (59 FR 7629, February 16, 1994).

Since tolerances and exemptions that are established on the basis of a petition under FFDCA section 408(d), such as the tolerance in this final rule, do not require the issuance of a proposed rule, the requirements of the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq.), do not apply.

This action directly regulates growers, food processors, food handlers, and food retailers, not States or tribes, nor does this action alter the relationships or distribution of power and responsibilities established by Congress in the preemption provisions of FFDCA section 408(n)(4). As such, the Agency has determined that this action will not have a substantial direct effect on States or tribal governments, on the relationship between the national government and the States or tribal governments, or on the distribution of power and responsibilities among the various levels of government or between the Federal Government and Indian tribes. Thus, the Agency has determined that Executive Order 13132, entitled “Federalism” (64 FR 43255, August 10, 1999) and Executive Order 13175, entitled “Consultation and Coordination with Indian Tribal Governments” (65 FR 67249, November 9, 2000) do not apply to this action. In addition, this action does not impose any enforceable duty or contain any unfunded mandate as described under Title II of the Unfunded Mandates Reform Act (UMRA) (2 U.S.C. 1501 et seq.).

This action does not involve any technical standards that would require Agency consideration of voluntary consensus standards pursuant to section 12(d) of the National Technology Transfer and Advancement Act (NTTAA) (15 U.S.C. 272 note).

VII. Congressional Review Act

Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq.), EPA will submit a report containing this rule and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register. This action is not a “major rule” as defined by 5 U.S.C. 804(2).

List of Subjects in 40 CFR Part 180

Environmental protection, Administrative practice and procedure, Agricultural commodities, Pesticides and pests, Reporting and recordkeeping requirements.

Dated: March 3, 2015. Susan Lewis, Director, Registration Division, Office of Pesticide Programs.

Therefore, 40 CFR chapter I is amended as follows:

PART 180—[AMENDED] 1. The authority citation for part 180 continues to read as follows: Authority:

21 U.S.C. 321(q), 346a and 371.

2. Revise § 180.589(a)(1) as follows: a. Add in alphabetical order entries for “Dill, seed” and “Herb subgroup 19A”. b. Remove the entries for “Fruit, stone, group 12” and “Nut, tree, group 14” and add in their place entries for “Fruit, stone, group 12-12” and “Nut, tree, group 14-12”, respectively. c. Remove the entry for “Pistachio.” d. Remove the entry for “Papya” and add in its place an entry for “Papaya.”

The addition and revisions read as follows:

§ 180.589 Boscalid; tolerances for residues.

(a) * * *

(1) * * *

Commodity Parts per
  • million
  • *    *    *    *    *    *    * Dill, seed 100 *    *    *    *    *    *    * Fruit, stone, group 12-12 3.5 *    *    *    *    *    *    * Herb subgroup 19A 150 *    *    *    *    *    *    * Nut, tree, group 14-12 0.70 *    *    *    *    *    *    * Papaya 1.5 *    *    *    *    *    *    *
    [FR Doc. 2015-06141 Filed 3-17-15; 8:45 am] BILLING CODE 6560-50-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 180 [EPA-HQ-OPP-2014-0483; FRL-9923-59] Dimethomorph; Pesticide Tolerance AGENCY:

    Environmental Protection Agency (EPA).

    ACTION:

    Final rule.

    SUMMARY:

    This regulation establishes a tolerance for residues of dimethomorph in or on papaya at 1.5 parts per million (ppm). BASF Corporation requested this tolerance under the Federal Food, Drug, and Cosmetic Act (FFDCA) to cover residues of dimethomorph in papaya imported into the United States; there are currently no U.S. registrations for pesticides containing dimethomorph that are used on papaya.

    DATES:

    This regulation is effective March 18, 2015. Objections and requests for hearings must be received on or before May 18, 2015, and must be filed in accordance with the instructions provided in 40 CFR part 178 (see also Unit I.C. of the SUPPLEMENTARY INFORMATION).

    ADDRESSES:

    The docket for this action, identified by docket identification (ID) number EPA-HQ-OPP-2014-0483, is available at http://www.regulations.gov or at the Office of Pesticide Programs Regulatory Public Docket (OPP Docket) in the Environmental Protection Agency Docket Center (EPA/DC), West William Jefferson Clinton Bldg., Rm. 3334, 1301 Constitution Ave. NW., Washington, DC 20460-0001. The Public Reading Room is open from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding legal holidays. The telephone number for the Public Reading Room is (202) 566-1744, and the telephone number for the OPP Docket is (703) 305-5805. Please review the visitor instructions and additional information about the docket available at http://www.epa.gov/dockets.

    FOR FURTHER INFORMATION CONTACT:

    Susan Lewis, Registration Division (7505P), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave. NW., Washington, DC 20460-0001; main telephone number: (703) 305-7090; email address: [email protected]

    SUPPLEMENTARY INFORMATION:

    I. General Information A. Does this action apply to me?

    You may be potentially affected by this action if you are an agricultural producer, food manufacturer, or pesticide manufacturer. The following list of North American Industrial Classification System (NAICS) codes is not intended to be exhaustive, but rather provides a guide to help readers determine whether this document applies to them. Potentially affected entities may include:

    • Crop production (NAICS code 111).

    • Animal production (NAICS code 112).

    • Food manufacturing (NAICS code 311).

    • Pesticide manufacturing (NAICS code 32532).

    B. How can I get electronic access to other related information?

    You may access a frequently updated electronic version of EPA's tolerance regulations at 40 CFR part 180 through the Government Publishing Office's e-CFR site at http://www.ecfr.gov/cgi-bin/text-idx?&c=ecfr&tpl=/ecfrbrowse/Title40/40tab_02.tpl.

    C. How can I file an objection or hearing request?

    Under FFDCA section 408(g), 21 U.S.C. 346a, any person may file an objection to any aspect of this regulation and may also request a hearing on those objections. You must file your objection or request a hearing on this regulation in accordance with the instructions provided in 40 CFR part 178. To ensure proper receipt by EPA, you must identify docket ID number EPA-HQ-OPP-2014-0483 in the subject line on the first page of your submission. All objections and requests for a hearing must be in writing, and must be received by the Hearing Clerk on or before May 18, 2015. Addresses for mail and hand delivery of objections and hearing requests are provided in 40 CFR 178.25(b).

    In addition to filing an objection or hearing request with the Hearing Clerk as described in 40 CFR part 178, please submit a copy of the filing (excluding any Confidential Business Information (CBI)) for inclusion in the public docket. Information not marked confidential pursuant to 40 CFR part 2 may be disclosed publicly by EPA without prior notice. Submit the non-CBI copy of your objection or hearing request, identified by docket ID number EPA-HQ-OPP-2014-0483, by one of the following methods:

    Federal eRulemaking Portal: http://www.regulations.gov. Follow the online instructions for submitting comments. Do not submit electronically any information you consider to be CBI or other information whose disclosure is restricted by statute.

    Mail: OPP Docket, Environmental Protection Agency Docket Center (EPA/DC), (28221T), 1200 Pennsylvania Ave. NW., Washington, DC 20460-0001.

    Hand Delivery: To make special arrangements for hand delivery or delivery of boxed information, please follow the instructions at http://www.epa.gov/dockets/contacts.html.

    Additional instructions on commenting or visiting the docket, along with more information about dockets generally, is available at http://www.epa.gov/dockets.

    II. Summary of Petitioned-For Tolerance

    In the Federal Register of December 17, 2014 (79 FR 75107) (FRL-9918-90), EPA issued a document pursuant to FFDCA section 408(d)(3), 21 U.S.C. 346a(d)(3), announcing the filing of a pesticide petition (PP 3E8218) by BASF Corporation, P.O. Box, 13528, Research Triangle Park, North Carolina 27709. The petition requested that 40 CFR part 180 be amended by establishing a tolerance for residues of the fungicide dimethomorph, in or on papaya at 1.5 ppm. That document referenced a summary of the petition prepared by BASF Corporation, the registrant, which is available in the docket, http://www.regulations.gov. No comments were received on the notice of filing.

    III. Aggregate Risk Assessment and Determination of Safety

    Section 408(b)(2)(A)(i) of FFDCA allows EPA to establish a tolerance (the legal limit for a pesticide chemical residue in or on a food) only if EPA determines that the tolerance is “safe.” Section 408(b)(2)(A)(ii) of FFDCA defines “safe” to mean that “there is a reasonable certainty that no harm will result from aggregate exposure to the pesticide chemical residue, including all anticipated dietary exposures and all other exposures for which there is reliable information.” This includes exposure through drinking water and in residential settings, but does not include occupational exposure. Section 408(b)(2)(C) of FFDCA requires EPA to give special consideration to exposure of infants and children to the pesticide chemical residue in establishing a tolerance and to “ensure that there is a reasonable certainty that no harm will result to infants and children from aggregate exposure to the pesticide chemical residue. . . .”

    Consistent with FFDCA section 408(b)(2)(D), and the factors specified in FFDCA section 408(b)(2)(D), EPA has reviewed the available scientific data and other relevant information in support of this action. EPA has sufficient data to assess the hazards of and to make a determination on aggregate exposure for dimethomorph including exposure resulting from the tolerances established by this action. EPA's assessment of exposures and risks associated with dimethomorph follows.

    A. Toxicological Profile

    EPA has evaluated the available toxicity data and considered its validity, completeness, and reliability as well as the relationship of the results of the studies to human risk. EPA has also considered available information concerning the variability of the sensitivities of major identifiable subgroups of consumers, including infants and children.

    Dimethomorph has low acute toxicity by the oral, dermal, or inhalation route of exposure. It is not an eye or skin irritant, and is not a skin sensitizer. There is no evidence that dimethomorph is a developmental, reproductive, carcinogenic, mutagenic or immunotoxic chemical. Dimethomorph is classified as “not likely to be carcinogenic to humans” based upon lack of evidence of carcinogenicity in rats and mice.

    No biologically significant effect was observed in the rat subchronic oral toxicity study while decreased body weight and increased incidence of arteritis in male rats and decreased body weights and increased incidence of “ground-glass” foci in livers of female rats were observed in the rat chronic toxicity study. In the dog subchronic oral toxicity study, decreased absolute and relative prostate weights, and slight liver effects were observed. No toxicity was observed at the limit dose in the rat 28-day dermal toxicity study. The developmental toxicity studies showed no increased sensitivity to offspring of either rats or rabbits as demonstrated by no-observed-adverse-effect-level's (NOAEL) equal to or higher than those producing toxicity in the maternal animals. Likewise, in the 2-generation reproduction study, there was no toxicity to the offspring at doses lower than that causing parental toxicity.

    In an acute neurotoxicity study, functional observational battery (FOB) findings and reduced motor activity were observed. However, these findings were considered an impairment of the overall condition of the animals following treatment, rather than direct neurotoxic effects of the dimethomorph exposure. No neurotoxic effects were observed in the subchronic neurotoxicity study in rats and there is no evidence of neurotoxicity throughout the dimethomorph toxicity database. There was no evidence of immunotoxicity in the immunotoxicity study.

    Specific information on the studies received and the nature of the adverse effects caused by dimethomorph as well as the NOAEL and the lowest-observed-adverse-effect-level (LOAEL) from the toxicity studies can be found at http://www.regulations.gov in document Dimethomorph: Human Health Risk Assessment to Support Establishment of a Tolerance Without U.S. Registration for Papaya on page 9 within the docket ID number EPA-HQ-OPP-2014-0483.

    B. Toxicological Points of Departure/Levels of Concern

    Once a pesticide's toxicological profile is determined, EPA identifies toxicological points of departure (POD) and levels of concern to use in evaluating the risk posed by human exposure to the pesticide. For hazards that have a threshold below which there is no appreciable risk, the toxicological POD is used as the basis for derivation of reference values for risk assessment. PODs are developed based on a careful analysis of the doses in each toxicological study to determine the dose at which the NOAEL and the LOAEL at which adverse effects of concern are identified. Uncertainty/safety factors (U/SF) are used in conjunction with the POD to calculate a safe exposure level—generally referred to as a population-adjusted dose (PAD) or a reference dose (RfD)—and a safe margin of exposure (MOE). For non-threshold risks, the Agency assumes that any amount of exposure will lead to some degree of risk. Thus, the Agency estimates risk in terms of the probability of an occurrence of the adverse effect expected in a lifetime. For more information on the general principles EPA uses in risk characterization and a complete description of the risk assessment process, see http://www.epa.gov/pesticides/factsheets/riskassess.htm.

    A summary of the toxicological endpoints for dimethomorph used for human risk assessment is shown in the Table of this unit.

    Table—Summary of Toxicological Doses and Endpoints for Dimethomorph for Use in Human Health Risk Assessment Exposure/scenario Point of departure
  • and uncertainty/
  • safety factors
  • RfD, PAD, LOC for
  • risk assessment
  • Study and toxicological effects
    Acute dietary (Females 13-49 years of age) No appropriate endpoint was identified including developmental toxicity studies in rats and rabbits Not applicable No study selected. Acute dietary (General population) LOAEL = 250 mg/kg/day UFA
  • UFH = 10x
  • FQPA SFL = 10x
  • Acute RfD = 0.25 mg/kg/day
  • aPAD = 0.25 mg/kg/day
  • Acute Neurotoxicity Study.
  • LOAEL = 250 mg/kg/day based on reduced motor activity in both sexes.
  • Chronic dietary (All populations) NOAEL = 11 mg/kg/day UFA = 10x
  • UFH = 10x
  • FQPA SF = 1x
  • Chronic RfD = 0.1 mg/kg/day
  • cPAD = 0.1 mg/kg/day
  • Carcinogenicity study in rats.
  • LOAEL = 46.3 mg/kg/day based on decreased body weight and increases in liver lesions in female rats.
  • Cancer (Oral, dermal, inhalation) Classification: “Not likely” to be a human carcinogen. FQPA SF = Food Quality Protection Act Safety Factor. LOAEL = lowest-observed-adverse-effect-level. LOC = level of concern. mg/kg/day = milligram/kilogram/day. NOAEL = no-observed-adverse-effect-level. PAD = population adjusted dose (a = acute, c = chronic). RfD = reference dose. UF = uncertainty factor. UFA = extrapolation from animal to human (interspecies). UFH = potential variation in sensitivity among members of the human population (intraspecies). UFL = use of a LOAEL to extrapolate a NOAEL.
    C. Exposure Assessment

    1. Dietary exposure from food and feed uses. In evaluating dietary exposure to dimethomorph, EPA considered exposure under the petitioned-for tolerances as well as all existing dimethomorph tolerances in 40 CFR 180.493. EPA assessed dietary exposures from dimethomorph in food as follows:

    i. Acute exposure. Quantitative acute dietary exposure and risk assessments are performed for a food-use pesticide, if a toxicological study has indicated the possibility of an effect of concern occurring as a result of a 1-day or single exposure. Such effects were identified for dimethomorph. In estimating acute dietary exposure, EPA used food consumption information from the United States Department of Agriculture (USDA) Nationwide Health and Nutrition Examination Survey, What We Eat In America (NHANES/WWEIA) conducted from 2003-2008. As to residue levels in food, EPA made the following assumptions for the acute exposure assessment: tolerance-level residues for all commodities, 100 percent crop treated (PCT) for all commodities and Dietary Exposure Evaluation Model (DEEM) (ver. 7.81) default processing factors or empirical processing factors.

    ii. Chronic exposure. In conducting the chronic dietary exposure assessment EPA used the food consumption data from the USDA's (NHANES/WWEIA) conducted from 2003-2008 as well. As to residue levels in food, EPA made the following assumptions for the chronic exposure assessment: Tolerance-level residues for all commodities, 100 PCT for all commodities and DEEM (ver. 7.81) default processing factors or empirical processing factors.

    iii. Cancer. Based on the data summarized in Unit III.A., EPA has concluded that dimethomorph should be classified as “not likely” to be a human carcinogen based upon lack of evidence of carcinogenicity in rats and mice. Therefore a cancer risk assessment was not necessary.

    iv. Anticipated residue and percent crop treated (PCT) information. EPA did not use anticipated residue and/or PCT information in the dietary assessment for dimethomorph. Tolerance level residues and/or 100 PCT were assumed for all food commodities.

    2. Dietary exposure from drinking water. The drinking water concentrations have not changed since the last assessment. The Agency utilized a maximum application rate of 1.4 pound active ingredient/acre/season (lb ai/A/season) for broccoli (which is the use with the most exposure and highest PCT area). The groundwater value was generated using the Screening Concentration in Groundwater (SCI-GROW) Model and the surface water values were generated using a Tier 1 broccoli model. The surface water estimate was used for both acute and chronic assessment (81.1 parts per billion (ppb) for acute and 24.7 ppb for chronic) because these values were higher than the groundwater value. Since the current petition is for a tolerance in/on imported papaya, an assessment of the impacts of that use on drinking water was not required.

    3. From non-dietary exposure. The term “residential exposure” is used in this document to refer to non-occupational, non-dietary exposure (e.g., for lawn and garden pest control, indoor pest control, termiticides, and flea and tick control on pets). Dimethomorph is not registered for any specific use patterns that would result in residential exposure.

    4. Cumulative effects from substances with a common mechanism of toxicity. Section 408(b)(2)(D)(v) of FFDCA requires that, when considering whether to establish, modify, or revoke a tolerance, the Agency consider “available information” concerning the cumulative effects of a particular pesticide's residues and “other substances that have a common mechanism of toxicity.”

    EPA has not found dimethomorph to share a common mechanism of toxicity with any other substances, and dimethomorph does not appear to produce a toxic metabolite produced by other substances. For the purposes of this tolerance action, therefore, EPA has assumed that dimethomorph does not have a common mechanism of toxicity with other substances. For information regarding EPA's efforts to determine which chemicals have a common mechanism of toxicity and to evaluate the cumulative effects of such chemicals, see EPA's Web site at http://www.epa.gov/pesticides/cumulative.

    D. Safety Factor for Infants and Children

    1. In general. Section 408(b)(2)(C) of FFDCA provides that EPA shall apply an additional tenfold (10X) margin of safety for infants and children in the case of threshold effects to account for prenatal and postnatal toxicity and the completeness of the database on toxicity and exposure unless EPA determines based on reliable data that a different margin of safety will be safe for infants and children. This additional margin of safety is commonly referred to as the Food Quality Protection Act Safety Factor (FQPA SF). In applying this provision, EPA either retains the default value of 10X, or uses a different additional safety factor when reliable data available to EPA support the choice of a different factor.

    2. Prenatal and postnatal sensitivity. The available data did not provide evidence of increased sensitivity in the offspring based on the results from developmental studies conducted with rats and rabbits as well as a 2-generation reproduction study conducted with rats. There were no toxic effects observed in either the rat developmental toxicity or the rat 2-generation reproductive toxicity studies at doses that were lower than doses which produced toxic effects in the parents. Additionally, no developmental toxicity was demonstrated in the rabbit developmental toxicity study.

    3. Conclusion. EPA has determined that reliable data show the safety of infants and children would be adequately protected if the FQPA SF were reduced to 1X. That decision is based on the following findings:

    i. The toxicity database for dimethomorph is complete.

    ii. The available data do not support a determination that dimethomorph is a neurotoxic chemical and there is no need for a developmental neurotoxicity study or additional UFs to account for neurotoxicity.

    iii. There is no evidence that dimethomorph results in increased susceptibility in in utero rats or rabbits in the prenatal developmental studies or in young rats in the 2-generation reproduction study.

    iv. There are no residual uncertainties identified in the exposure databases. The unrefined acute and chronic dietary risk assessments used tolerance level residues, included modeled drinking water estimates, assumed 100 PCT, and incorporated DEEM default processing factors. EPA made conservative (protective) assumptions in the groundwater and surface water modeling used to assess exposure to dimethomorph in drinking water. These assessments will not underestimate the exposure and risks posed by dimethomorph.

    E. Aggregate Risks and Determination of Safety

    EPA determines whether acute and chronic dietary pesticide exposures are safe by comparing aggregate exposure estimates to the acute PAD (aPAD) and chronic PAD (cPAD). For linear cancer risks, EPA calculates the lifetime probability of acquiring cancer given the estimated aggregate exposure. Short-, intermediate-, and chronic-term risks are evaluated by comparing the estimated aggregate food, water, and residential exposure to the appropriate PODs to ensure that an adequate MOE exists.

    1. Acute risk. Using the exposure assumptions discussed in this unit for acute exposure, the acute dietary exposure from food and water to dimethomorph will occupy 39% of the aPAD for children 3-5 years old, the population group receiving the greatest exposure.

    2. Chronic risk. Using the exposure assumptions described in this unit for chronic exposure, EPA has concluded that chronic exposure to dimethomorph from food and water will utilize 25% of the cPAD for children 1-2 years the population group receiving the greatest exposure. There are no residential uses for dimethomorph.

    3. Short-term risk. Short-term aggregate exposure takes into account short-term residential exposure plus chronic exposure to food and water (considered to be a background exposure level). Because no short-term adverse effect was identified, dimethomorph is not expected to pose a short-term risk.

    4. Intermediate-term risk. Intermediate-term aggregate exposure takes into account intermediate-term residential exposure plus chronic exposure to food and water (considered to be a background exposure level). An intermediate-term adverse effect was identified; however, dimethomorph is not registered for any use patterns that would result in intermediate-term residential exposure. Intermediate-term risk is assessed based on intermediate-term residential exposure plus chronic dietary exposure. Because there is no intermediate-term residential exposure and chronic dietary exposure has already been assessed under the appropriately protective cPAD (which is at least as protective as the POD used to assess intermediate-term risk), no further assessment of intermediate-term risk is necessary, and EPA relies on the chronic dietary risk assessment for evaluating intermediate-term risk for dimethomorph.

    5. Aggregate cancer risk for U.S. population. Based on the lack of evidence of carcinogenicity in two adequate rodent carcinogenicity studies, dimethomorph is not expected to pose a cancer risk to humans.

    6. Determination of safety. Based on these risk assessments, EPA concludes that there is a reasonable certainty that no harm will result to the general population, or to infants and children from aggregate exposure to dimethomorph residues.

    IV. Other Considerations A. Analytical Enforcement Methodology

    FAMS-002-04 which utilizes high performance liquid chromatography with ultraviolet detection (HPLC/UV) is available to enforce the tolerance expression. The method may be requested from: Chief, Analytical Chemistry Branch, Environmental Science Center, 701 Mapes Rd., Ft. Meade, MD 20755-5350; telephone number: (410) 305-2905; email address: [email protected]

    B. International Residue Limits

    In making its tolerance decisions, EPA seeks to harmonize U.S. tolerances with international standards whenever possible, consistent with U.S. food safety standards and agricultural practices. EPA considers the international maximum residue limits (MRLs) established by the Codex Alimentarius Commission (Codex), as required by FFDCA section 408(b)(4). The Codex Alimentarius is a joint United Nations Food and Agriculture Organization/World Health Organization food standards program, and it is recognized as an international food safety standards-setting organization in trade agreements to which the United States is a party. EPA may establish a tolerance that is different from a Codex MRL; however, FFDCA section 408(b)(4) requires that EPA explain the reasons for departing from the Codex level.

    The Codex has not established a MRL for residues of dimethomorph in/on papaya.

    V. Conclusion

    Therefore, tolerances are established for residues of dimethomorph, in or on papaya at 1.5 ppm. While no pesticides containing dimethomorph have been registered in the United States for use on papaya, this tolerance allows importation of papaya containing permissible residues of dimethomorph under the FFDCA.

    VI. Statutory and Executive Order Reviews

    This action establishes a tolerance under FFDCA section 408(d) in response to a petition submitted to the Agency. The Office of Management and Budget (OMB) has exempted these types of actions from review under Executive Order 12866, entitled “Regulatory Planning and Review” (58 FR 51735, October 4, 1993). Because this action has been exempted from review under Executive Order 12866, this action is not subject to Executive Order 13211, entitled “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355, May 22, 2001) or Executive Order 13045, entitled “Protection of Children from Environmental Health Risks and Safety Risks” (62 FR 19885, April 23, 1997). This action does not contain any information collections subject to OMB approval under the Paperwork Reduction Act (PRA) (44 U.S.C. 3501 et seq.), nor does it require any special considerations under Executive Order 12898, entitled “Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations” (59 FR 7629, February 16, 1994).

    Since tolerances and exemptions that are established on the basis of a petition under FFDCA section 408(d), such as the tolerance in this final rule, do not require the issuance of a proposed rule, the requirements of the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq.), do not apply.

    This action directly regulates growers, food processors, food handlers, and food retailers, not States or tribes, nor does this action alter the relationships or distribution of power and responsibilities established by Congress in the preemption provisions of FFDCA section 408(n)(4). As such, the Agency has determined that this action will not have a substantial direct effect on States or tribal governments, on the relationship between the national government and the States or tribal governments, or on the distribution of power and responsibilities among the various levels of government or between the Federal Government and Indian tribes. Thus, the Agency has determined that Executive Order 13132, entitled “Federalism” (64 FR 43255, August 10, 1999) and Executive Order 13175, entitled “Consultation and Coordination with Indian Tribal Governments” (65 FR 67249, November 9, 2000) do not apply to this action. In addition, this action does not impose any enforceable duty or contain any unfunded mandate as described under Title II of the Unfunded Mandates Reform Act (UMRA) (2 U.S.C. 1501 et seq.).

    This action does not involve any technical standards that would require Agency consideration of voluntary consensus standards pursuant to section 12(d) of the National Technology Transfer and Advancement Act (NTTAA) (15 U.S.C. 272 note).

    VII. Congressional Review Act

    Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq.), EPA will submit a report containing this rule and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register. This action is not a “major rule” as defined by 5 U.S.C. 804(2).

    List of Subjects in 40 CFR Part 180

    Environmental protection, Administrative practice and procedure, Agricultural commodities, Pesticides and pests, Reporting and recordkeeping requirements.

    Dated: March 9, 2015. Susan Lewis, Director, Registration Division, Office of Pesticide Programs.

    Therefore, 40 CFR chapter I is amended as follows:

    PART 180—[AMENDED] 1. The authority citation for part 180 continues to read as follows: Authority:

    21 U.S.C. 321(q), 346a and 371.

    2. In § 180.493 alphabetically add the commodity “papaya” to the table in paragraph (a) to read as follows:
    § 180.493 Dimethomorph; tolerances for residues.

    (a) General. * * *

    Commodity Parts per
  • million
  • * * * * * * Papaya 1 1.5 * * * * * * 1 There are no U.S. registrations as of January 20, 2015.
    [FR Doc. 2015-06106 Filed 3-17-15; 8:45 am] BILLING CODE 6560-50-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 52 [EPA-R04-OAR-2014-0610; FRL-9924-47-Region 4] Approval and Promulgation of Implementation Plans; Region 4 States; 2008 Lead, 2008 Ozone and 2010 Nitrogen Dioxide Prevention of Significant Deterioration Infrastructure Plans AGENCY:

    Environmental Protection Agency.

    ACTION:

    Final rule.

    SUMMARY:

    The Environmental Protection Agency (EPA) is approving portions of submissions from Alabama, Florida, Georgia, Kentucky, Mississippi, South Carolina and Tennessee for inclusion into each State's implementation plan. This action pertains to the Clean Air Act (CAA or Act) infrastructure requirements for the 2008 Lead, 2008 Ozone and 2010 Nitrogen Dioxide (NO2) National Ambient Air Quality Standards (NAAQS). The CAA requires that each state adopt and submit a state implementation plan (SIP) for the implementation, maintenance, and enforcement of each NAAQS promulgated by EPA. These plans are commonly referred to as “infrastructure” SIPs. Specifically, EPA is approving the portions of the submissions from Alabama, Florida, Georgia, Kentucky, Mississippi, South Carolina and Tennessee that relate to the infrastructure SIP prevention of significant deterioration (PSD) requirements. All other applicable infrastructure requirements for the 2008 Lead, 2008 Ozone and 2010 NO2 NAAQS associated with these States are being addressed in separate rulemakings.

    DATES:

    This rule is effective on April 17, 2015.

    ADDRESSES:

    EPA has established a docket for this action under Docket Identification No. EPA-R04-OAR-2014-0610. All documents in the docket are listed on the www.regulations.gov Web site. Although listed in the index, some information is not publicly available, i.e., Confidential Business Information or other information whose disclosure is restricted by statute. Certain other material, such as copyrighted material, is not placed on the Internet and will be publicly available only in hard copy form. Publicly available docket materials are available either electronically through www.regulations.gov or in hard copy at the Air Regulatory Management Section (formerly Regulatory Development Section), Air Planning and Implementation Branch, Air, Pesticides and Toxics Management Division, U.S. Environmental Protection Agency, Region 4, 61 Forsyth Street SW., Atlanta, Georgia 30303-8960. EPA requests that if at all possible, you contact the person listed in the FOR FURTHER INFORMATION CONTACT section to schedule your inspection. The Regional Office's official hours of business are Monday through Friday 8:30 a.m. to 4:30 p.m., excluding Federal holidays.

    FOR FURTHER INFORMATION CONTACT:

    Sean Lakeman, Air Regulatory Management Section, Air Planning and Implementation Branch, Air, Pesticides and Toxics Management Division, U.S. Environmental Protection Agency, Region 4, 61 Forsyth Street SW., Atlanta, Georgia 30303-8960. The telephone number is (404) 562-9043. Mr. Lakeman can be reached via electronic mail at [email protected]

    SUPPLEMENTARY INFORMATION:

    I. Background

    By statute, SIPs meeting the requirements of sections 110(a)(1) and (2) are to be submitted by states within three years after promulgation of a new or revised NAAQS to provide for the implementation, maintenance, and enforcement of the new or revised NAAQS. EPA has historically referred to these SIP submissions made for the purpose of satisfying the requirements of CAA sections 110(a)(1) and 110(a)(2) as “infrastructure SIP” submissions. Sections 110(a)(1) and (2) require states to address basic SIP elements such as for monitoring, basic program requirements and legal authority that are designed to assure attainment and maintenance of the newly established or revised NAAQS. More specifically, section 110(a)(1) provides the procedural and timing requirements for SIPs. Section 110(a)(2) lists specific elements that states must meet for the “infrastructure” SIP requirements related to a newly established or revised NAAQS. The contents of an infrastructure SIP submission may vary depending upon the data and analytical tools available to the state, as well as the provisions already contained in the state's implementation plan at the time in which the state develops and submits the submission for a new or revised NAAQS.

    Through this action, EPA is approving the PSD requirements of sections 110(a)(2)(C), 110(a)(2)(D)(i)(II) (prong 3) and 110(a)(2)(J) (hereafter “PSD Elements”) for various infrastructure SIP submissions from the states of Alabama, Florida, Georgia, Kentucky, Mississippi, South Carolina and Tennessee. As described further below, for some of these states, EPA is approving the PSD Elements in the infrastructure SIP submissions for the 2008 Lead, 2008 Ozone and 2010 NO2 NAAQS; whereas for other states, EPA is only approving the PSD Elements of the infrastructure SIP submissions for a subset of these NAAQS. All other applicable infrastructure requirements for the 2008 Lead, 2008 Ozone and 2010 NO2 NAAQS associated with these States are being addressed in separate rulemakings.

    a. 2008 Lead NAAQS

    For the 2008 Lead NAAQS, EPA is only approving the PSD Elements of the infrastructure SIP submissions from Alabama (received November 4, 2011), Florida (received October 14, 2011), Georgia (received May 14, 2012), Kentucky (received July 17, 2012), Mississippi (received November 17, 2011), and South Carolina (received September 20, 2011). EPA notes that the Agency approved the PSD Elements of Tennessee's 2008 Lead infrastructure SIP submission on August 12, 2013 (78 FR 48806).

    b. 2008 Ozone NAAQS

    For the 2008 Ozone NAAQS, EPA is only approving the PSD Elements of the infrastructure SIP submissions from Alabama (received August 20, 2012), Georgia (received March 6, 2012), Mississippi (received May 29, 2012; and resubmitted July 26, 2012), and South Carolina (received on July 17, 2012). EPA notes that the Agency approved the PSD Elements of the infrastructure SIP submissions for the 2008 Ozone NAAQS for Kentucky on March 7, 2013 (78 FR 14691) and November 3, 2014 (79 FR 65143), and Tennessee on March 6, 2013 (78 FR 14450) and January 9, 2014 (79 FR 1593).

    c. 2010 NO2 NAAQS

    For the 2010 NO2 NAAQS, EPA is approving the PSD Elements of the infrastructure SIP submissions from Alabama (received April 23, 2013), Florida (received January 22, 2013), Georgia (received March 25, 2013), Kentucky (received April 26, 2013), Mississippi (received February 28, 2013), South Carolina (received April 30, 2014), and Tennessee (received March 13, 2014).

    EPA is acting upon the PSD Elements portions of SIP submissions that address the infrastructure requirements of CAA sections 110(a)(1) and 110(a)(2) for the 2008 Lead, 2008 Ozone and 2010 NO2 NAAQS for various states in Region 4. Section 110(a)(2) includes a list of specific elements that “[e]ach such plan” submission must address. EPA's review of infrastructure SIP submissions with respect to the PSD program requirements in sections 110(a)(2)(C), 110(a)(2)(D)(i)(II), and 110(a)(2)(J) focuses upon the structural PSD program requirements contained in part C and EPA's PSD regulations. Structural PSD program requirements include provisions necessary for the PSD program to address all regulated sources and new source review (NSR) pollutants, including GHGs.

    On November 13, 2014, EPA published a proposed rulemaking to approve the portions of the above-described infrastructure SIP submissions from Alabama, Florida, Georgia, Kentucky, Mississippi, South Carolina and Tennessee to address the PSD permitting requirements of sections 110(a)(2)(C), 110(a)(2)(D)(i)(II) (prong 3) and 110(a)(2)(J) of the CAA. See 79 FR 67398. Comments on the proposed rulemaking were due on or before December 15, 2014. No adverse comments were received. EPA's November 13, 2014, proposed rulemaking contains more detailed information regarding Alabama, Florida, Georgia, Kentucky, Mississippi, South Carolina and Tennessee submissions to address the PSD permitting requirements being approved today, and the rationale for this final action.

    II. What are states required to address under Sections 110(a)(2)(C), 110(a)(2)(D)(i)(II) (Prong 3) and 110(a)(2)(J) related to PSD?

    Section 110(a)(2)(C) has three components that must be addressed in infrastructure SIP submissions: Enforcement, state-wide regulation of new and modified minor sources and minor modifications of major sources; and PSD permitting of major sources and major modifications in areas designated attainment or unclassifiable for the subject NAAQS as required by CAA title I part C (i.e., the major source PSD program).

    Section 110(a)(2)(D)(i) has two components; 110(a)(2)(D)(i)(I) and 110(a)(2)(D)(i)(II). Each of these components have two subparts resulting in four distinct components, commonly referred to as “prongs,” that must be addressed in infrastructure SIP submissions. The first two prongs, which are codified in section 110(a)(2)(D)(i)(I), are provisions that prohibit any source or other type of emissions activity in one state from contributing significantly to nonattainment of the NAAQS in another state (“prong 1”), and interfering with maintenance of the NAAQS in another state (“prong 2”). The third and fourth prongs, which are codified in section 110(a)(2)(D)(i)(II), are provisions that prohibit emissions activity in one state interfering with measures required to prevent significant deterioration of air quality in another state (“prong 3”), or to protect visibility in another state (“prong 4”).

    Section 110(a)(2)(J) has four components that must be addressed in infrastructure SIP submissions: (1) Consultation with government officials, (2) public notification, (3) prevention of significant deterioration, and (4) visibility protection.

    With respect to the PSD Elements of these sections, EPA interprets the CAA to require each state to make, for each new or revised NAAQS, an infrastructure SIP submission that demonstrates that the air agency has a complete PSD permitting program meeting the current requirements for all regulated NSR pollutants.

    See EPA's November 13, 2014, proposed rulemaking at 79 FR 67398 for more detailed information on EPA's analysis of how the Alabama, Florida, Georgia, Kentucky, Mississippi, South Carolina and Tennessee infrastructure SIP submissions meet the requirements of the PSD Elements for the NAAQS for which they were submitted. As mentioned above, EPA did not receive any adverse comments on the November 13, 2014, proposed rulemaking. As such and based on EPA's analysis, the Agency has made the determination that:

    • Alabama's SIP and practices are adequate and comply with PSD Elements for the 2008 Lead, 2008 Ozone and 2010 NO2 NAAQS;

    • Florida's SIP and practices are adequate and comply with PSD Elements for the 2008 Lead and 2010 NO2 NAAQS;

    • Georgia's SIP and practices are adequate and comply with the PSD Elements for the 2008 Lead, 2008 Ozone, and 2010 NO2 NAAQS;

    • Kentucky's SIP and practices are adequate and comply with the PSD Elements for the 2008 Lead and 2010 NO2 NAAQS;

    • Mississippi's SIP and practices are adequate and comply with the PSD Elements for the 2008 Lead, 2008 Ozone, and 2010 NO2 NAAQS;

    • South Carolina's SIP and practices are adequate and comply with the infrastructure SIP PSD Elements for the 2008 Lead, 2008 Ozone, and 2010 NO2 NAAQS; and

    • Tennessee's SIP and practices are adequate and comply with the infrastructure SIP PSD Elements for the 2010 NO2 NAAQS.

    III. Final Action

    As described above, EPA is approving the portions of the above-described infrastructure SIP submissions from Alabama, Florida, Georgia, Kentucky, Mississippi, South Carolina and Tennessee to address the PSD permitting requirements of sections 110(a)(2)(C), 110(a)(2)(D)(i)(II) (prong 3) and 110(a)(2)(J) of the CAA. As described above, for some of these states, EPA is approving the PSD Elements of the infrastructure SIP submissions for the 2008 Lead, 2008 Ozone and 2010 Nitrogen NO2 NAAQS; whereas for other states, EPA is only approving the PSD Elements of the infrastructure SIP submissions for a subset of these NAAQS. EPA is approving these portions of these submissions because they are consistent with section 110 of the CAA.

    EPA also notes that, at present, the Agency has preliminarily determined that the Alabama, Florida, Georgia, Kentucky, Mississippi, South Carolina and Tennessee SIPs are sufficient to satisfy the PSD permitting requirements portion of section 110(a)(2)(C), 110(a)(2)(D)(i)(II), prong 3 and 110(a)(2)(J) with respect to GHGs because the PSD permitting program previously-approved by EPA into the SIP continues to require that PSD permits (otherwise required based on emissions of pollutants other than GHGs) contain limitations on GHG emissions based on the application of Best Available Control Technology. Although the approved Alabama, Florida, Georgia, Kentucky, Mississippi, South Carolina and Tennessee PSD permitting programs may currently contain provisions that are no longer necessary in light of the Supreme Court's Utility Air Regulatory Group v. Environmental Protection Agency decision, these previous approvals do not render the infrastructure SIP submission inadequate to satisfy sections 110(a)(2)(C), 110(a)(2)(D)(i)(II) (prong 3) and 110(a)(2)(J). The SIPs contain the necessary PSD requirements at this time, and the application of those requirements is not impeded by the presence of other previously-approved provisions regarding the permitting of sources of GHGs that EPA does not consider necessary at this time in light of the Supreme Court decision. Accordingly, the Supreme Court decision does not affect EPA's approval of Alabama, Florida, Georgia, Kentucky, Mississippi, South Carolina and Tennessee's infrastructure SIPs as to the PSD permitting requirements of sections 110(a)(2)(C), 110(a)(2)(D)(i)(II) (prong 3) and 110(a)(2)(J).

    IV. Statutory and Executive Order Reviews

    Under the CAA, the Administrator is required to approve a SIP submission that complies with the provisions of the Act and applicable federal regulations. See 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in reviewing SIP submissions, EPA's role is to approve state choices, provided that they meet the criteria of the CAA. Accordingly, this action merely approves state law as meeting federal requirements and does not impose additional requirements beyond those imposed by state law. For that reason, this action:

    • Is not a significant regulatory action subject to review by the Office of Management and Budget under Executive Orders 12866 (58 FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 2011);

    • does not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);

    • is certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.);

    • does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4);

    • does not have Federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999);

    • is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997);

    • is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);

    • is not subject to requirements of Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) because application of those requirements would be inconsistent with the CAA; and

    • does not provide EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).

    With the exception of South Carolina, the SIPs involved in this action are not approved to apply on any Indian reservation land or in any other area where EPA or an Indian tribe has demonstrated that a tribe has jurisdiction. In those areas of Indian country, the rule does not have tribal implications as specified by Executive Order 13175 (65 FR 67249, November 9, 2000), nor will it impose substantial direct costs on tribal governments or preempt tribal law.” With respect to this action as it relates to South Carolina, EPA notes that the Catawba Indian Nation Reservation is located within South Carolina and pursuant to the Catawba Indian Claims Settlement Act, S.C. Code Ann. 27-16-120, “all state and local environmental laws and regulations apply to the Catawba Indian Nation and Reservation and are fully enforceable by all relevant state and local agencies and authorities.” Thus, the South Carolina SIP applies to the Catawba Reservation, however, because this action is not approving any specific rule into the South Carolina SIP, but rather proposing that the State's already approved SIP meets certain CAA requirements, EPA has determined that there are no substantial direct effects on the Catawba Indian Nation. EPA has also determined that these revisions will not impose any substantial direct costs on tribal governments or preempt tribal law.

    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this action and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register. A major rule cannot take effect until 60 days after it is published in the Federal Register. This action is not a “major rule” as defined by 5 U.S.C. 804(2).

    Under section 307(b)(1) of the CAA, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by May 18, 2015. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements. See section 307(b)(2).

    List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Incorporation by reference, Intergovernmental relations, Nitrogen dioxide, Particulate matter, Reporting and recordkeeping requirements, Volatile organic compounds.

    Dated: March 6, 2015. Heather McTeer Toney, Regional Administrator, Region 4.

    40 CFR part 52 is amended as follows:

    PART 52—APPROVAL AND PROMULGATION OF IMPLEMENTATION PLANS 1. The authority citation for part 52 continues to read as follows: Authority:

    42 U.S.C. 7401 et seq.

    Subpart B—Alabama 2. Section 52.50(e), is amended by adding three new entries for “110(a)(1) and (2) Infrastructure Requirements for the 2008 Lead NAAQS”, “110(a)(1) and (2) Infrastructure Requirements for the 2008 Ozone NAAQS”, and “110(a)(1) and (2) Infrastructure Requirements for the 2010 NO2 NAAQS” at the end of the table to read as follows:
    § 52.50 Identification of plan.

    (e) * * *

    EPA-Approved Alabama Non-Regulatory Provisions Name of
  • nonregulatory SIP
  • provision
  • Applicable geographic or nonattainment area State submittal date/effective date EPA Approval date Explanation
    *          *          *          *          *          *          * 110(a)(1) and (2) Infrastructure Requirements for the 2008 Lead NAAQS Alabama 11/4/2011 3/18/2015 Federal Register citation Addressing the PSD permitting requirements of sections 110(a)(2)(C), 110(a)(2)(D)(i)(II) (prong 3) and 110(a)(2)(J) only. 110(a)(1) and (2) Infrastructure Requirements for the 2008 Ozone NAAQS Alabama 8/20/2012 3/18/2015 [Insert Federal Register citation] Addressing the PSD permitting requirements of sections 110(a)(2)(C), 110(a)(2)(D)(i)(II) (prong 3) and 110(a)(2)(J) only. 110(a)(1) and (2) Infrastructure Requirements for the 2010 NO2 NAAQS Alabama 4/23/2013 3/18/2015 [Insert Federal Register citation] Addressing the PSD permitting requirements of sections 110(a)(2)(C), 110(a)(2)(D)(i)(II) (prong 3) and 110(a)(2)(J) only.
    Subpart K—Florida 3. Section 52.520(e), is amended by adding two new entries for “110(a)(1) and (2) Infrastructure Requirements for the 2008 Lead NAAQS” and “110(a)(1) and (2) Infrastructure Requirements for the 2010 NO2 NAAQS” at the end of the table to read as follows:
    § 52.520 Identification of plan.

    (e) * * *

    EPA-Approved Florida Non-Regulatory Provisions Provision State effective date EPA Approval date Federal Register notice Explanation *          *          *          *          *          *          * 110(a)(1) and (2) Infrastructure Requirements for the 2008 Lead NAAQS 10/14/2011 3/18/2015 [Insert Federal Register citation] Addressing the PSD permitting requirements of sections 110(a)(2)(C), 110(a)(2)(D)(i)(II) (prong 3) and 110(a)(2)(J) only. 110(a)(1) and (2) Infrastructure Requirements for the 2010 NO2 NAAQS 1/22/2013 3/18/2015 [Insert Federal Register citation] Addressing the PSD permitting requirements of sections 110(a)(2)(C), 110(a)(2)(D)(i)(II) (prong 3) and 110(a)(2)(J) only.
    Subpart L—Georgia 4. Section 52.570(e), is amended by adding three new entries for “110(a)(1) and (2) Infrastructure Requirements for the 2008 Lead NAAQS”, “110(a)(1) and (2) Infrastructure Requirements for the 2008 Ozone NAAQS”, and “110(a)(1) and (2) Infrastructure Requirements for the 2010 NO2 NAAQS” at the end of the table to read as follows:
    § 52.570 Identification of plan.

    (e) * * *

    EPA-Approved Georgia Non-Regulatory Provisions Name of
  • nonregulatory SIP
  • provision
  • Applicable geographic or nonattainment area State submittal date/effective date EPA Approval date Explanation
    *          *          *          *          *          *          * 110(a)(1) and (2) Infrastructure Requirements for the 2008 Lead NAAQS Georgia 5/14/2012 3/18/2015 [Insert Federal Register citation] Addressing the PSD permitting requirements of sections 110(a)(2)(C), 110(a)(2)(D)(i)(II) (prong 3) and 110(a)(2)(J) only. 110(a)(1) and (2) Infrastructure Requirements for the 2008 Ozone NAAQS Georgia 3/6/2012 3/18/2015 [Insert Federal Register citation] Addressing the PSD permitting requirements of sections 110(a)(2)(C), 110(a)(2)(D)(i)(II) (prong 3) and 110(a)(2)(J) only. 110(a)(1) and (2) Infrastructure Requirements for the 2010 NO2 NAAQS Georgia 3/25/2013 3/18/2015 [Insert Federal Register citation] Addressing the PSD permitting requirements of sections 110(a)(2)(C), 110(a)(2)(D)(i)(II) (prong 3) and 110(a)(2)(J) only.
    Subpart S—Kentucky 5. Section 52.920(e), is amended by adding two new entries “110(a)(1) and (2) Infrastructure Requirements for the 2008 Lead NAAQS” and “110(a)(1) and (2) Infrastructure Requirements for the 2010 NO2 NAAQS” at the end of the table to read as follows:
    § 52.920 Identification of plan.

    (e) * * *

    EPA-Approved Kentucky Non-Regulatory Provisions Name of
  • non-regulatory
  • SIP provision
  • Applicable geographic or
  • nonattainment area
  • State submittal date/effective date EPA Approval date Explanations
    *         *         *         *         *         *         * 110(a)(1) and (2) Infrastructure Requirements for the 2008 Lead NAAQS Kentucky 7/17/2012 3/18/2015 [Insert Federal Register citation] Addressing the PSD permitting requirements of sections 110(a)(2)(C), 110(a)(2)(D)(i)(II) (prong 3) and 110(a)(2)(J) only 110(a)(1) and (2) Infrastructure Requirements for the 2010 NO2 NAAQS Kentucky 4/26/2013 3/18/2015 [Insert Federal Register citation] Addressing the PSD permitting requirements of sections 110(a)(2)(C), 110(a)(2)(D)(i)(II) (prong 3) and 110(a)(2)(J) only
    Subpart Z—Mississippi 6. Section 52.1270(e), is amended by adding three new entries for “110(a)(1) and (2) Infrastructure Requirements for the 2008 Lead NAAQS”, “110(a)(1) and (2) Infrastructure Requirements for the 2008 Ozone NAAQS”, and “110(a)(1) and (2) Infrastructure Requirements for the 2010 NO2 NAAQS” at the end of the table to read as follows:
    § 52.1270 Identification of plan.

    (e) * * *

    EPA-Approved Mississippi Non-Regulatory Provisions Name of
  • nonregulatory
  • SIP provision
  • Applicable geographic or
  • nonattainment area
  • State submittal date/effective date EPA Approval date Explanation
    *         *         *         *         *         *         * 110(a)(1) and (2) Infrastructure Requirements for the 2008 Lead NAAQS Mississippi 11/17/2011 3/18/2015
  • [Insert Federal Register citation]
  • Addressing the PSD permitting requirements of sections 110(a)(2)(C), 110(a)(2)(D)(i)(II) (prong 3) and 110(a)(2)(J) only.
    110(a)(1) and (2) Infrastructure Requirements for the 2008 Ozone NAAQS Mississippi 5/29/2012 and amended on 7/26/2012 3/18/2015
  • [Insert Federal Register citation]
  • Addressing the PSD permitting requirements of sections 110(a)(2)(C), 110(a)(2)(D)(i)(II) (prong 3) and 110(a)(2)(J) only.
    110(a)(1) and (2) Infrastructure Requirements for the 2010 NO2 NAAQS Mississippi 2/28/2013 3/18/2015
  • [Insert Federal Register citation]
  • Addressing the PSD permitting requirements of sections 110(a)(2)(C), 110(a)(2)(D)(i)(II) (prong 3) and 110(a)(2)(J) only.
    Subpart PP—South Carolina 7. Section 52.2120(e), is amended by adding three new entries for “110(a)(1) and (2) Infrastructure Requirements for the 2008 Lead NAAQS”, “110(a)(1) and (2) Infrastructure Requirements for the 2008 Ozone NAAQS”, and “110(a)(1) and (2) Infrastructure Requirements for the 2010 NO2 NAAQS” at the end of the table to read as follows:
    § 52.2120 Identification of plan.

    (e) * * *

    Provision State effective date EPA Approval date Explanation *         *         *         *         *         *         * 110(a)(1) and (2) Infrastructure Requirements for the 2008 Lead NAAQS 9/20/2011 3/18/2015
  • [Insert Federal Register citation]
  • Addressing the PSD permitting requirements of sections 110(a)(2)(C), 110(a)(2)(D)(i)(II) (prong 3) and 110(a)(2)(J) only.
    110(a)(1) and (2) Infrastructure Requirements for the 2008 Ozone NAAQS 7/17/2012 3/18/2015
  • [Insert Federal Register citation]
  • Addressing the PSD permitting requirements of sections 110(a)(2)(C), 110(a)(2)(D)(i)(II) (prong 3) and 110(a)(2)(J) only.
    110(a)(1) and (2) Infrastructure Requirements for the 2010 NO2 NAAQS 4/30/2014 3/18/2015
  • [Insert Federal Register citation]
  • Addressing the PSD permitting requirements of sections 110(a)(2)(C), 110(a)(2)(D)(i)(II) (prong 3) and 110(a)(2)(J) only.
    Subpart RR—Tennessee 8. Section 52.2220(e), is amended by adding a new entry for “110(a)(1) and (2) Infrastructure Requirements for the 2010 NO2 NAAQS” at the end of the table to read as follows:
    § 52.2220 Identification of plan.

    (e) * * *

    EPA-Approved Tennessee Non-Regulatory Provisions Name of
  • non-regulatory
  • SIP provision
  • Applicable geographic or
  • nonattainment area
  • State effective date EPA Approval date Explanation
    *         *         *         *         *         *         * 110(a)(1) and (2) Infrastructure Requirements for the 2010 NO2 NAAQS Tennessee 3/13/2014 3/18/2015 [Insert Federal Register citation] Addressing the PSD permitting requirements of sections 110(a)(2)(C), 110(a)(2)(D)(i)(II) (prong 3) and 110(a)(2)(J) only.
    [FR Doc. 2015-06112 Filed 3-17-15; 8:45 am] BILLING CODE 6560-50-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 180 [EPA-HQ-OPP-2014-0847; FRL-9923-63] 2-Propenoic acid, polymer With ethenyl acetate, ethenylbenzene, 2-ethylhexyl 2-propenoate and ethyl 2-propenoate; Tolerance Exemption AGENCY:

    Environmental Protection Agency (EPA).

    ACTION:

    Final rule.

    SUMMARY:

    This regulation establishes an exemption from the requirement of a tolerance for residues of 2-Propenoic acid, polymer with ethenyl acetate, ethenylbenzene, 2-ethylhexyl 2-propenoate and ethyl 2-propenoate; when used as an inert ingredient in a pesticide chemical formulation. BASF Corporation submitted a petition to EPA under the Federal Food, Drug, and Cosmetic Act (FFDCA), requesting an exemption from the requirement of a tolerance. This regulation eliminates the need to establish a maximum permissible level for residues of 2-Propenoic acid, polymer with ethenyl acetate, ethenylbenzene, 2-ethylhexyl 2-propenoate and ethyl 2-propenoate on food or feed commodities.

    DATES:

    This regulation is effective March 18, 2015. Objections and requests for hearings must be received on or before May 18, 2015, and must be filed in accordance with the instructions provided in 40 CFR part 178 (see also Unit I.C. of the SUPPLEMENTARY INFORMATION).

    ADDRESSES:

    The docket for this action, identified by docket identification (ID) number EPA-HQ-OPP-2014-0874, is available at http://www.regulations.gov or at the Office of Pesticide Programs Regulatory Public Docket (OPP Docket) in the Environmental Protection Agency Docket Center (EPA/DC), West William Jefferson Clinton Bldg., Rm. 3334, 1301 Constitution Ave. NW., Washington, DC 20460-0001. The Public Reading Room is open from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding legal holidays. The telephone number for the Public Reading Room is (202) 566-1744, and the telephone number for the OPP Docket is (703) 305-5805. Please review the visitor instructions and additional information about the docket available at http://www.epa.gov/dockets.

    FOR FURTHER INFORMATION CONTACT:

    Susan Lewis, Registration Division (7505P), Office of Pesticide Programs, Environmental Protection Agency, 1200 Pennsylvania Ave. NW., Washington, DC 20460-0001; main telephone number: (703) 305-7090; email address: [email protected]

    SUPPLEMENTARY INFORMATION:

    I. General Information A. Does this action apply to me?

    You may be potentially affected by this action if you are an agricultural producer, food manufacturer, or pesticide manufacturer. The following list of North American Industrial Classification System (NAICS) codes is not intended to be exhaustive, but rather provides a guide to help readers determine whether this document applies to them. Potentially affected entities may include:

    • Crop production (NAICS code 111).

    • Animal production (NAICS code 112).

    • Food manufacturing (NAICS code 311).

    • Pesticide manufacturing (NAICS code 32532).

    B. How can I get electronic access to other related information?

    You may access a frequently updated electronic version of 40 CFR part 180 through the Government Publishing Office's e-CFR site at http://www.ecfr.gov/cgi-bin/text-idx?&c=ecfr&tpl=/ecfrbrowse/Title40/40tab_02.tpl.

    C. Can I file an objection or hearing request?

    Under FFDCA section 408(g), 21 U.S.C. 346a, any person may file an objection to any aspect of this regulation and may also request a hearing on those objections. You must file your objection or request a hearing on this regulation in accordance with the instructions provided in 40 CFR part 178. To ensure proper receipt by EPA, you must identify docket ID number EPA-HQ-OPP-2014-0874 in the subject line on the first page of your submission. All objections and requests for a hearing must be in writing, and must be received by the Hearing Clerk on or before May 18, 2015. Addresses for mail and hand delivery of objections and hearing requests are provided in 40 CFR 178.25(b).

    In addition to filing an objection or hearing request with the Hearing Clerk as described in 40 CFR part 178, please submit a copy of the filing (excluding any Confidential Business Information (CBI)) for inclusion in the public docket. Information not marked confidential pursuant to 40 CFR part 2 may be disclosed publicly by EPA without prior notice. Submit the non-CBI copy of your objection or hearing request, identified by docket ID number EPA-HQ-OPP-2014-0874, by one of the following methods.

    Federal eRulemaking Portal: http://www.regulations.gov. Follow the online instructions for submitting comments. Do not submit electronically any information you consider to be CBI or other information whose disclosure is restricted by statute.

    Mail: OPP Docket, Environmental Protection Agency Docket Center (EPA/DC), (28221T), 1200 Pennsylvania Ave. NW., Washington, DC 20460-0001.

    Hand Delivery: To make special arrangements for hand delivery or delivery of boxed information, please follow the instructions at http://www.epa.gov/dockets/contacts.html.

    Additional instructions on commenting or visiting the docket, along with more information about dockets generally, is available at http://www.epa.gov/dockets.

    II. Background and Statutory Findings

    In the Federal Register of January 28, 2015 (80 FR 4527) (FRL-9921-55), EPA issued a document pursuant to FFDCA section 408, 21 U.S.C. 346a, announcing the receipt of a pesticide petition (PP IN-10770) filed by BASF Corporation, 100 Park Avenue, Florham Park, NJ 07932. The petition requested that 40 CFR 180.960 be amended by establishing an exemption from the requirement of a tolerance for residues of 2-Propenoic acid, polymer with ethenyl acetate, ethenylbenzene, 2-ethylhexyl 2-propenoate and ethyl 2-propenoate; CAS Reg. No. 85075-52-1. That document included a summary of the petition prepared by the petitioner and solicited comments on the petitioner's request. The Agency did not receive any comments.

    Section 408(c)(2)(A)(i) of FFDCA allows EPA to establish an exemption from the requirement for a tolerance (the legal limit for a pesticide chemical residue in or on a food) only if EPA determines that the exemption is “safe.” Section 408(c)(2)(A)(ii) of FFDCA defines “safe” to mean that “there is a reasonable certainty that no harm will result from aggregate exposure to the pesticide chemical residue, including all anticipated dietary exposures and all other exposures for which there is reliable information.” This includes exposure through drinking water and use in residential settings, but does not include occupational exposure. Section 408(b)(2)(C) of FFDCA requires EPA to give special consideration to exposure of infants and children to the pesticide chemical residue in establishing an exemption from the requirement of a tolerance and to “ensure that there is a reasonable certainty that no harm will result to infants and children from aggregate exposure to the pesticide chemical residue . . .” and specifies factors EPA is to consider in establishing an exemption.

    III. Risk Assessment and Statutory Findings

    EPA establishes exemptions from the requirement of a tolerance only in those cases where it can be shown that the risks from aggregate exposure to pesticide chemical residues under reasonably foreseeable circumstances will pose no appreciable risks to human health. In order to determine the risks from aggregate exposure to pesticide inert ingredients, the Agency considers the toxicity of the inert in conjunction with possible exposure to residues of the inert ingredient through food, drinking water, and through other exposures that occur as a result of pesticide use in residential settings. If EPA is able to determine that a finite tolerance is not necessary to ensure that there is a reasonable certainty that no harm will result from aggregate exposure to the inert ingredient, an exemption from the requirement of a tolerance may be established.

    Consistent with FFDCA section 408(b)(2)(D), EPA has reviewed the available scientific data and other relevant information in support of this action and considered its validity, completeness and reliability and the relationship of this information to human risk. EPA has also considered available information concerning the variability of the sensitivities of major identifiable subgroups of consumers, including infants and children. In the case of certain chemical substances that are defined as polymers, the Agency has established a set of criteria to identify categories of polymers expected to present minimal or no risk. The definition of a polymer is given in 40 CFR 723.250(b) and the exclusion criteria for identifying these low-risk polymers are described in 40 CFR 723.250(d).

    2-Propenoic acid, polymer with ethenyl acetate, ethenylbenzene, 2-ethylhexyl 2-propenoate and ethyl 2-propenoate conforms to the definition of a polymer given in 40 CFR 723.250(b) and meets the following criteria that are used to identify low-risk polymers.

    1. The polymer is not a cationic polymer nor is it reasonably anticipated to become a cationic polymer in a natural aquatic environment.

    2. The polymer does contain as an integral part of its composition the atomic elements carbon, hydrogen, and oxygen.

    3. The polymer does not contain as an integral part of its composition, except as impurities, any element other than those listed in 40 CFR 723.250(d)(2)(ii).

    4. The polymer is neither designed nor can it be reasonably anticipated to substantially degrade, decompose, or depolymerize.

    5. The polymer is manufactured or imported from monomers and/or reactants that are already included on the TSCA Chemical Substance Inventory or manufactured under an applicable TSCA section 5 exemption.

    6. The polymer is not a water absorbing polymer with a number average molecular weight (MW) greater than or equal to 10,000 Daltons.

    Additionally, the polymer also meets as required the following exemption criteria specified in 40 CFR 723.250(e).

    7. The polymer's number average MW of >50,000 Daltons is greater than or equal to 10,000 Daltons. The polymer contains less than 2% oligomeric material below MW 500 and less than 5% oligomeric material below MW 1,000.

    Thus, 2-Propenoic acid, polymer with ethenyl acetate, ethenylbenzene, 2-ethylhexyl 2-propenoate and ethyl 2-propenoate meets the criteria for a polymer to be considered low risk under 40 CFR 723.250. Based on its conformance to the criteria in this unit, no mammalian toxicity is anticipated from dietary, inhalation, or dermal exposure to 2-Propenoic acid, polymer with ethenyl acetate, ethenylbenzene, 2-ethylhexyl 2-propenoate and ethyl 2-propenoate.

    IV. Aggregate Exposures

    For the purposes of assessing potential exposure under this exemption, EPA considered that 2-Propenoic acid, polymer with ethenyl acetate, ethenylbenzene, 2-ethylhexyl 2-propenoate and ethyl 2-propenoate could be present in all raw and processed agricultural commodities and drinking water, and that non-occupational non-dietary exposure was possible. The number average MW of 2-Propenoic acid, polymer with ethenyl acetate, ethenylbenzene, 2-ethylhexyl 2-propenoate and ethyl 2-propenoate is >50,000 Daltons. Generally, a polymer of this size would be poorly absorbed through the intact gastrointestinal tract or through intact human skin. Since 2-Propenoic acid, polymer with ethenyl acetate, ethenylbenzene, 2-ethylhexyl 2-propenoate and ethyl 2-propenoate conform to the criteria that identify a low-risk polymer, there are no concerns for risks associated with any potential exposure scenarios that are reasonably foreseeable. The Agency has determined that a tolerance is not necessary to protect the public health.

    V. Cumulative Effects From Substances With a Common Mechanism of Toxicity

    Section 408(b)(2)(D)(v) of FFDCA requires that, when considering whether to establish, modify, or revoke a tolerance, the Agency consider “available information” concerning the cumulative effects of a particular pesticide's residues and “other substances that have a common mechanism of toxicity.”

    EPA has not found 2-Propenoic acid, polymer with ethenyl acetate, ethenylbenzene, 2-ethylhexyl 2-propenoate and ethyl 2-propenoate to share a common mechanism of toxicity with any other substances, and 2-Propenoic acid, polymer with ethenyl acetate, ethenylbenzene, 2-ethylhexyl 2-propenoate and ethyl 2-propenoate does not appear to produce a toxic metabolite produced by other substances. For the purposes of this tolerance action, therefore, EPA has assumed that 2-Propenoic acid, polymer with ethenyl acetate, ethenylbenzene, 2-ethylhexyl 2-propenoate and ethyl 2-propenoate does not have a common mechanism of toxicity with other substances. For information regarding EPA's efforts to determine which chemicals have a common mechanism of toxicity and to evaluate the cumulative effects of such chemicals, see EPA's Web site at http://www.epa.gov/pesticides/cumulative.

    VI. Additional Safety Factor for the Protection of Infants and Children

    Section 408(b)(2)(C) of FFDCA provides that EPA shall apply an additional tenfold margin of safety for infants and children in the case of threshold effects to account for prenatal and postnatal toxicity and the completeness of the data base unless EPA concludes that a different margin of safety will be safe for infants and children. Due to the expected low toxicity of 2-Propenoic acid, polymer with ethenyl acetate, ethenylbenzene, 2-ethylhexyl 2-propenoate and ethyl 2-propenoate, EPA has not used a safety factor analysis to assess the risk. For the same reasons the additional tenfold safety factor is unnecessary.

    VII. Determination of Safety

    Based on the conformance to the criteria used to identify a low-risk polymer, EPA concludes that there is a reasonable certainty of no harm to the U.S. population, including infants and children, from aggregate exposure to residues of 2-Propenoic acid, polymer with ethenyl acetate, ethenylbenzene, 2-ethylhexyl 2-propenoate and ethyl 2-propenoate.

    VIII. Other Considerations A. Existing Exemptions From a Tolerance

    There are no existing exemptions from a tolerance for 2-Propenoic acid, polymer with ethenyl acetate, ethenylbenzene, 2-ethylhexyl 2-propenoate and ethyl 2-propenoate polymers.

    B. Analytical Enforcement Methodology

    An analytical method is not required for enforcement purposes since the Agency is establishing an exemption from the requirement of a tolerance without any numerical limitation.

    IX. Conclusion

    Accordingly, EPA finds that exempting residues of 2-Propenoic acid, polymer with ethenyl acetate, ethenylbenzene, 2-ethylhexyl 2-propenoate and ethyl 2-propenoate from the requirement of a tolerance will be safe.

    X. Statutory and Executive Order Reviews

    This action establishes a tolerance under FFDCA section 408(d) in response to a petition submitted to the Agency. The Office of Management and Budget (OMB) has exempted these types of actions from review under Executive Order 12866, entitled “Regulatory Planning and Review” (58 FR 51735, October 4, 1993). Because this action has been exempted from review under Executive Order 12866, this action is not subject to Executive Order 13211, entitled “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355, May 22, 2001) or Executive Order 13045, entitled “Protection of Children from Environmental Health Risks and Safety Risks” (62 FR 19885, April 23, 1997). This action does not contain any information collections subject to OMB approval under the Paperwork Reduction Act (PRA) (44 U.S.C. 3501 et seq.), nor does it require any special considerations under Executive Order 12898, entitled “Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations” (59 FR 7629, February 16, 1994).

    Since tolerances and exemptions that are established on the basis of a petition under FFDCA section 408(d), such as the tolerance in this final rule, do not require the issuance of a proposed rule, the requirements of the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq.), do not apply.

    This action directly regulates growers, food processors, food handlers, and food retailers, not States or tribes, nor does this action alter the relationships or distribution of power and responsibilities established by Congress in the preemption provisions of FFDCA section 408(n)(4). As such, the Agency has determined that this action will not have a substantial direct effect on States or tribal governments, on the relationship between the national government and the States or tribal governments, or on the distribution of power and responsibilities among the various levels of government or between the Federal Government and Indian Tribes. Thus, the Agency has determined that Executive Order 13132, entitled “Federalism” (64 FR 43255, August 10, 1999) and Executive Order 13175, entitled “Consultation and Coordination with Indian Tribal Governments” (65 FR 67249, November 9, 2000) do not apply to this action. In addition, this action does not impose any enforceable duty or contain any unfunded mandate as described under Title II of the Unfunded Mandates Reform Act (UMRA) (2 U.S.C. 1501 et seq.).

    This action does not involve any technical standards that would require Agency consideration of voluntary consensus standards pursuant to section 12(d) of the National Technology Transfer and Advancement Act (NTTAA) (15 U.S.C. 272 note).

    XI. Congressional Review Act

    Pursuant to the Congressional Review Act (5 U.S.C. 801 et seq.), EPA will submit a report containing this rule and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register. This action is not a “major rule” as defined by 5 U.S.C. 804(2).

    List of Subjects in 40 CFR Part 180

    Environmental protection, Administrative practice and procedure, Agricultural commodities, Pesticides and pests, Reporting and recordkeeping requirements.

    Dated: March 12, 2015. Susan Lewis, Director, Registration Division, Office of Pesticide Programs.

    Therefore, 40 CFR chapter I is amended as follows:

    PART 180—[AMENDED]

    1. The authority citation for part 180 continues to read as follows:

    Authority:

    21 U.S.C. 321(q), 346a and 371.

    2. In § 180.960, the table is amended by alphabetically adding an entry for “2-Propenoic acid, polymer with ethenyl acetate, ethenylbenzene, 2-ethylhexyl 2-propenoate and ethyl 2-propenoate, minimum number average molecular weight (50,149 Daltons)” after the entry for “2-propenoic acid polymer, with 1,3-butadiene and ethenylbenzene, minimum number average molecular weight (in amu), 9400” to read as follows:
    §  180.960 Polymers; exemptions from the requirement of a tolerance. Polymer CAS No. *         *         *         *         *         *         * 2-Propenoic acid, polymer with ethenyl acetate, ethenylbenzene, 2-ethylhexyl 2-propenoate and ethyl 2-propenoate, minimum number average molecular weight (50,149 Daltons) 85075-52-1 *         *         *         *         *         *         *
    [FR Doc. 2015-06227 Filed 3-17-15; 8:45 am] BILLING CODE 6560-50-P
    DEPARTMENT OF TRANSPORTATION Federal Railroad Administration 49 CFR Chapter II [Railworthiness Directive, Notice No. 1] Railworthiness Directive for Railroad Tank Cars Equipped With Certain McKenzie Valve & Machining LLC Valves AGENCY:

    Federal Railroad Administration (FRA), Department of Transportation (DOT).

    ACTION:

    Notice of railworthiness directive.

    SUMMARY:

    Recent FRA investigations identified several railroad tank cars transporting hazardous materials and leaking small quantities of product from the cars' liquid lines. FRA's investigation revealed that the liquid lines of the leaking tank cars were equipped with a certain type of 3″ ball valve marketed and sold by McKenzie Valve and Machining (McKenzie) (formerly McKenzie Valve & Machining Company), an affiliate company of Union Tank Car Company (UTLX). FRA further found certain closure plugs installed on the 3″ valves cause mechanical damage to the valves, which leads to the destruction of the valves' seal integrity and that the 3″ valves, as well as similarly-designed 1″ and 2″ valves provided by this manufacturer are not approved for use on tank cars. FRA is issuing this Railworthiness Directive (Directive) to all owners of tank cars used to transport hazardous materials within the United States to ensure they identify and appropriately remove and replace these valves with approved valves consistent with Federal regulations.

    DATES:

    This Directive is effective March 18, 2015. This Directive is applicable March 13, 2015.

    FOR FURTHER INFORMATION CONTACT:

    Karl Alexy, Staff Director, Hazardous Materials Division, Office of Technical Oversight, FRA, 1200 New Jersey Avenue SE., Washington, DC 20590, telephone (202) 493-6245; [email protected]

    SUPPLEMENTARY INFORMATION:

    Recent FRA investigations identified several DOT Specification 111 railroad tank cars transporting hazardous materials and leaking small quantities of product.1 One instance occurred during the week of January 11, 2015, and involved a train of 100 tank cars loaded with crude oil being transported by BNSF Railway (BNSF) from Tioga, ND, to a refinery in Anacortes, WA. BNSF discovered 14 tank cars leaking crude oil en route and in accordance with the applicable regulations, notified FRA of the releases. Upon discovery of the defective condition of these cars, BNSF removed the cars from the train (at Hauser, ID; Vancouver and Auburn, WA, respectively). When the train arrived at its final destination in Anacortes, the consignee, Tesoro Refining, discovered two additional cars leaking product. In all, BNSF and Tesoro identified 16 leaking tank cars from the original train consist.

    1 DOT Specification 111 tank cars are general purpose, nonpressure railroad tank cars commonly used to transport a variety of regulated hazardous materials, as well as nonregulated commodities. In 2011, through issuance of Casualty Prevention Circular 1232, the Association of American Railroads (AAR) adopted an industry standard intended to improve the crashworthiness of DOT Specification 111 tank cars used in crude oil and ethanol service. These cars, known as CPC 1232 cars, include a thicker shell, head protection, top fittings protection, and relief valves with a greater flow capacity as compared to baseline DOT Specification 111 cars. The leaking tank cars identified in this Directive include both a baseline DOT 111 Specification car and CPC-1232 cars.

    On January 15, 2015, FRA inspected seven of the identified leaking tank cars that BNSF removed from the train in Vancouver. The FRA inspector observed crude oil on the sides of each of these cars, and upon inspection of each tank car's top fittings, found product leaking from the liquid line ball valves and around each valve's closure plug. FRA also found the standalone closure plugs in each of these valves loose. Further inspection revealed that the valve balls had visual signs of mechanical damage. The mechanical damage FRA observed indicated that the bottom face of the closure plug came in contact with the valve ball, consequentially preventing complete engagement of the closure plug.

    A second instance involved a single tank car loaded with mineral spirits (a Class 3 flammable liquid) found leaking on January 15, 2015, in a BNSF yard in Denver, CO. FRA's preliminary investigation shows that the leak occurred through the liquid line valve while the car was en route to its destination.

    UTLX owns all 17 of the cars found leaking as described above. Each of the leaking cars was configured with liquid line ball valves sold by UTLX's affiliate, McKenzie, and each valve was configured with a 3″ standalone plug as a closure. FRA identified the leaking valves as 3″ McKenzie UNNR threaded ball valves (McKenzie valves).

    McKenzie provided FRA several valve configuration drawings indicating that the valve was a full port valve. This configuration requires a 3″ x 2″ reducer bushing with a 2″ plug to prevent contact between the closure plug and the valve ball. McKenzie also informed FRA that it markets and sells the same design of valve in 1″ and 2″ models. For the 2″ valve, McKenzie specified the use of a 1″ plug and an appropriately sized reducer.

    At FRA's request, UTLX provided FRA drawings of the top fittings arrangements for these cars. However, unlike the drawings provided by McKenzie, the UTLX drawings provided by UTLX did not include a full port valve with a reducer bushing. Instead, consistent with the physical configuration of the tank cars FRA inspected, the drawings showed a full port threaded valve along with a 3″ plug and chain.

    On January 27, 2015, FRA conducted field testing of the McKenzie valves at UTLX's Altoona, PA, tank car repair facility. FRA tested new 1″, 2″, and 3″ McKenzie valves at the facility's valve shop. The field testing included two cycles of application and removal of each valve's plug. FRA found that the 1″ and 2″ McKenzie valves showed no signs of contact between the valve ball when a 1″ or 2″ closure plug was installed and tightened. However, when a 3″ closure plug was applied and tightened in the 3″ McKenzie valve, the plug contacted and damaged the ball. The damage observed during this testing was consistent with the type of damage observed on the leaking UTLX tank cars described above.

    FRA's field testing further found that the application of downward force on the valve ball applied by the 3″ plug resulted in the over-compression, damage, and misalignment of the inboard seal, causing the valve to leak. FRA also observed that once a valve's ball is damaged, when the valve is subsequently opened, the damaged surface of the ball also damaged the valve's top seals by tearing the seals. This further compromises the valve's seal. Additionally, FRA understands that with repeated opening and closing (exemplifying in-service use), the valve's threads will degrade, necessitating further engagement of the threads during subsequent applications of the plug. This continual degradation of the threads will require increasingly more tightening of the plug, exacerbating the damage to the ball and seals. In summary, FRA found that normal application and tightening of the 3″ plug in a 3″ McKenzie valve destroys the valve seal integrity.

    FRA conducted a followup investigation at the UTLX facility in Altoona to perform a leak test of the 3″ McKenzie valve that was field tested and damaged on January 27, 2015. Although the designed leak-free working pressure of this valve is up to 500 pounds per square inch (psi), the leak test procedure requires that the valve hold a minimum pressure of 30 psi. The subject McKenzie valve failed to retain the minimum 30 psi of compressed air test pressure. The valve showed signs of a significant leak.

    As required by Title 49 Code of Federal Regulations (CFR) 179.100-13 and 179.200-16 of the Federal Hazardous Materials Regulations (49 CFR parts 171-180; (HMR)), all valves applied to tanks cars must be of an approved design. The term “approved″ is defined in 49 CFR 179.2 as “approved by the [AAR] Tank Car Committee.” 2

    2 As background, the Tank Car Committee is composed of various railroad industry representatives, including railroads, tank car shipper and owner organizations, tank car builders, and chemical and industry associations. FRA and the DOT's Pipeline and Hazardous Materials Safety Administration also participate in the Tank Car Committee's processes. The Tank Car Committee has traditionally been the body with the expertise to develop tank car design, construction, and maintenance standards in this country. DOT sets minimum tank car specifications at 49 CFR part 179, and AAR approves designs meeting the requirements of part 179.

    McKenzie provided FRA with the Association of American Railroads (AAR) approval letters for the McKenzie valves. While McKenzie may have believed these approvals were sufficient, the provided AAR approvals demonstrate clear inconsistencies between the type of valve design that AAR approved versus the design of the valve actually being used and the design depicted on the valve configuration drawings both McKenzie and UTLX provided to FRA. AAR Approval E-077035 (October 26, 2007) is a renewal of previous AAR approvals,3 and describes a 3″ standard port threaded ball valve. The original approvals that AAR renewed described and referred to UTLX Drawing 72916, which depicts a 3″ standard port threaded ball valve. In contrast, the 3″ McKenzie valve at issue is a full port ball valve. A full port valve is different from a standard port valve.4 The dimensions of the valve body that AAR approved is significantly longer than the bodies of the valves depicted on the McKenzie drawings and the bodies of the valves actually installed on the leaking tank cars. McKenzie also provided a copy of a September 29, 2008, application for approval of a 3″ threaded full port valve (AAR application number E-087016), but neither McKenzie nor AAR have provided evidence of that valve's subsequent approval.

    3 AAR Approval E-977030 (April 9, 1997). AAR Approval E-977030 was a renewal of AAR Approval E-897047 (June 21, 1989), which also referred to UTLX Drawing 72916.

    4 The difference between a full port and standard port ball valve is the size of the ball's bore diameter as related to nominal pipe sizes, with the ball size being in proportion to the bore size diameter. The bore size in a full port valve is that of its nominal pipe size, where the bore size in a standard port valve is that of the next smallest nominal pipe size. For example, the bore diameter for a 3″ standard port ball valve is approximately 2.25″, or one pipe size smaller, and for a full port ball valve, the bore diameter is approximately 3″ in diameter (the actual size of the pipe).

    McKenzie provided information to FRA indicating that from 2009 through the present, it sold approximately 11,200 of the 3″ valves to a variety of tank car owners and tank car facilities. McKenzie indicates that since 2012, its sales of these valves were predominantly to replace in-kind valves previously installed on existing tank cars. Further, McKenzie informed FRA that as of January 26, 2015, the company has stopped selling the 3″ valves as a result of the noted safety concerns. Overall, McKenzie and UTLX provided information leading FRA to conclude that approximately 6,000 DOT Specification railroad tank cars are equipped with the unapproved 3″ McKenzie UNNR valves. In addition, McKenzie indicates that it has sold over 37,000 1″ and 2″ valves to a variety of tank car owners and tank car facilities.

    To date, FRA has identified only a small number of relatively minor hazardous materials leaks directly attributable to the identified McKenzie valves. FRA believes that the number of leaks potentially attributable to the identified McKenzie valves used in tank car liquid lines could be much higher. Based on FRA's field testing, the 3″ McKenzie valve appears to present an immediate safety issue in certain circumstances. While the 1″ and 2″ McKenzie valves do not appear to present similar concerns, based on the information that AAR, McKenzie, and UTLX have provided to date, it does not appear that any size of the McKenzie valves (i.e., the 1″, 2″, or 3″ UNNR valves) are currently approved for use on railroad tank cars. Accordingly, use of such valves on tank cars is in violation of the HMR. At this time, FRA is not aware of any non-accident releases or other releases from railroad tank cars involving the 1″ or 2″ McKenzie valves, but since the valves have not been approved by AAR they have not been shown to be safe for use on railroad tank cars.

    McKenzie and UTLX have taken independent actions to address some of the safety concerns with the 3″ valves. However, FRA believes those actions fail to adequately address the safety issue the valves present.

    Railworthiness Directive: Based on the above discussion, and acting under the authority granted in 49 CFR 180.509(b)(4), FRA finds that the continued use of railroad tank cars equipped with the unapproved McKenzie UNNR threaded ball valves (including the 1″, 2″, and 3″ UNNR valves) to transport hazardous materials by rail in the United States presents an unsafe operating condition. The use of such tank cars equipped with these valves could result in the release of hazardous materials. Further, the use of tank cars equipped with these McKenzie valves used to transport hazardous materials in the United States violates the requirements of the HMR. FRA is issuing this directive to ensure public safety, ensure compliance with the applicable Federal regulations governing the safe movement of hazardous materials by rail, and restore the railworthiness of all tank cars equipped with the above-described McKenzie valves.

    Upon the applicability date of this Directive, any railroad tank car equipped with an unapproved McKenzie UNNR threaded ball valve (McKenzie valve) is prohibited from being loaded with any hazardous material described in 49 CFR 172.101 and offered into transportation until the requirements listed below are met. Tank car owners 5 of tank cars equipped with McKenzie valves must:

    5 The term “tank car owners” is as defined in 49 CFR 180.503.

    (1) Identify the railroad tank cars in their fleet equipped with any McKenzie valve.

    (2) Provide to FRA: (a) The reporting mark and number of each car equipped with any McKenzie valve; and (b) the type of valve each car is equipped with.

    (3) Create and maintain for a minimum of 6 months from the applicability date of this directive a record of the inspection of each McKenzie valve. The record must include, at a minimum, the inspection date and location, as well as the results of the inspection (i.e., whether the valve was removed or not). The record must be made available to FRA for inspection upon request.

    (4) Immediately inspect the 3″ McKenzie valves on each affected car. If any valve is configured with a 3″ standalone plug, ensure that the car is not loaded and offered into transportation until that valve is replaced with an approved valve consistent with 49 CFR part 179. In addition, any tank car equipped with an unapproved 3″ McKenzie valve is prohibited from being offered into transportation (whether loaded or residue) after May 12, 2015.

    (5) Immediately inspect the 1″ and 2″ McKenzie valves on each affected car. If any valve shows evidence of mechanical damage, ensure that the car is not loaded and offered into transportation until that valve is replaced with an approved valve consistent with 49 CFR part 179. Even if a valve is not damaged, a tank car equipped with an unapproved 1″ or 2″ McKenzie valve is prohibited from being offered into transportation (whether loaded or residue) after June 11, 2015.

    (6) Ensure that each unapproved McKenzie valve is removed and replaced by an entity permitted to perform such work in accordance with 49 CFR part 179.

    (7) Ensure the valve application is properly qualified as required by subpart F of 49 CFR part 180.

    After tank car owners have inspected and/or replaced the unapproved valves on each affected tank car as required above, and have provided the necessary information regarding that car to FRA, tank car owners may load the cars with hazardous materials and offer those cars for transportation. Alternatively, if upon an adequate showing demonstrating the safety of the 1″ and 2″ valves, McKenzie obtains AAR's approval for the use of those valves on DOT Specification 111 tank cars, cars equipped with these 1″ or 2″ McKenzie valves may be returned to hazardous materials service.

    Tank car owners must send the information required to be submitted to FRA under this Directive to:

    Mr. Randy M. Keltz, Jr., Tank Car Quality Assurance Specialist, Office of Railroad Safety, Federal Railroad Administration, 1200 New Jersey Avenue SE., Washington, DC 20590, Telephone: (202) 236-7460, Email: [email protected]

    Regardless of any entity's compliance with this directive, FRA reserves the right to seek civil penalties or to take any other appropriate enforcement action for violations of the HMR that have occurred. FRA will be conducting an investigation to ensure that all tank cars equipped with the valves in question are identified and repaired consistent with the requirements of this Directive.

    Issued in Washington, DC, on March 13, 2015. Robert C. Lauby, Associate Administrator for Railroad Safety, Chief Safety Officer.
    [FR Doc. 2015-06213 Filed 3-17-15; 8:45 am] BILLING CODE 4910-06-P
    80 52 Wednesday, March 18, 2015 Proposed Rules DEPARTMENT OF AGRICULTURE Federal Crop Insurance Corporation 7 CFR Part 400 [Docket No. FCIC-14-0001] RIN 0563-AC45 General Administrative Regulations; Subpart X—Interpretations of Statutory Provisions, Policy Provisions, and Procedures AGENCY:

    Federal Crop Insurance Corporation, USDA.

    ACTION:

    Proposed rule.

    SUMMARY:

    The Federal Crop Insurance Corporation (FCIC) proposes to revise the General and Administrative Regulation Subpart X—Interpretations of Statutory and Regulatory Provisions, to incorporate interpretations of procedures previously issued and administered in accordance with Manager's Bulletin MGR-05-018 and to provide a mechanism for interpretations of policy provisions that are not codified in the Code of Federal Regulations. The intended effect of this action is to provide requestors with information on how to request a final agency determination or an interpretation of FCIC procedures within one administrative regulation, bring consistency and clarity to the processes used, and to clarify existing provisions.

    DATES:

    Written comments and opinions on this proposed rule will be accepted until close of business April 17, 2015 and will be considered when the rule is to be made final.

    ADDRESSES:

    FCIC prefers that comments be submitted electronically through the Federal eRulemaking Portal. You may submit comments, identified by Docket ID No. FCIC-14-0001, by any of the following methods:

    • Federal eRulemaking Portal: http://www.regulations.gov. Follow the instructions for submitting comments.

    • Mail: Director, Product Administration and Standards Division, Risk Management Agency, United States Department of Agriculture, P.O. Box 419205, Kansas City, MO 64133-6205.

    All comments received, including those received by mail, will be posted without change to http://www.regulations.gov, including any personal information provided, and can be accessed by the public. All comments must include the agency name and docket number or Regulatory Information Number (RIN) for this rule. For detailed instructions on submitting comments and additional information, see http://www.regulations.gov. If you are submitting comments electronically through the Federal eRulemaking Portal and want to attach a document, we ask that it be in a text-based format. If you want to attach a document that is a scanned Adobe PDF file, it must be scanned as text and not as an image, thus allowing FCIC to search and copy certain portions of your submissions. For questions regarding attaching a document that is a scanned Adobe PDF file, please contact the RMA Web Content Team at (816) 823-4694 or by email at [email protected]

    Privacy Act: Anyone is able to search the electronic form of all comments received for any dockets by the name of the person submitting the comment (or signing the comment, if submitted on behalf of an association, business, labor union, etc.). You may review the complete User Notice and Privacy Notice for Regulations.gov at http://www.regulations.gov/#!privacyNotice.

    FOR FURTHER INFORMATION CONTACT:

    Product Management, Product Administration and Standards Division, Risk Management Agency, United States Department of Agriculture, Beacon Facility, Stop 0812, Room 421, PO Box 419205, Kansas City, MO 64141-6205, telephone (816) 926- 7730.

    SUPPLEMENTARY INFORMATION:

    Executive Order 12866

    This rule has been determined to be not significant for the purposes of Executive Order 12866 and, therefore, it has not been reviewed by the OMB.

    Paperwork Reduction Act of 1995

    Pursuant to the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. chapter 35), the collections of information in this rule have been approved by the Office of Management and Budget (OMB) under control number 0563-0055.

    E-Government Act Compliance

    FCIC is committed to complying with the E-Government Act of 2002, to promote the use of the Internet and other information technologies to provide increased opportunities for citizen access to Government information and services, and for other purposes.

    Unfunded Mandates Reform Act of 1995

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), Public Law 104-4, establishes requirements for Federal agencies to assess the effects of their regulatory actions on State, local, and tribal governments and the private sector. This rule contains no Federal mandates (under the regulatory provisions of title II of the UMRA) for State, local, and tribal governments or the private sector. Therefore, this rule is not subject to the requirements of sections 202 and 205 of UMRA.

    Executive Order 13132

    It has been determined under section 1(a) of Executive Order 13132, Federalism, that this rule does not have sufficient implications to warrant consultation with the States. The provisions contained in this rule will not have a substantial direct effect on States, or on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government.

    Executive Order 13175

    This rule has been reviewed in accordance with the requirements of Executive Order 13175, Consultation and Coordination with Indian Tribal Governments. The review reveals that this regulation will not have substantial and direct effects on Tribal governments and will not have significant Tribal implications.

    Regulatory Flexibility Act

    FCIC certifies that this regulation will not have a significant economic impact on a substantial number of small entities. The regulation does not require any more action on the part of the small entities than is required on the part of large entities. A Regulatory Flexibility Analysis has not been prepared since this regulation does not have an impact on small entities, and, therefore, this regulation is exempt from the provisions of the Regulatory Flexibility Act (5 U.S.C. 605).

    Federal Assistance Program

    This program is listed in the Catalog of Federal Domestic Assistance under No. 10.450.

    Executive Order 12372

    This program is not subject to the provisions of Executive Order 12372, which require intergovernmental consultation with State and local officials. See the Notice related to 7 CFR part 3015, subpart V, published at 48 FR 29115, June 24, 1983.

    Executive Order 12988

    This proposed rule has been reviewed in accordance with Executive Order 12988 on civil justice reform. The provisions of this rule will not have a retroactive effect. The provisions of this rule will preempt State and local laws to the extent such State and local laws are inconsistent herewith. Interpretations of statutory and regulatory provisions are matters of general applicability and, therefore, no administrative appeals process is available and judicial review may only be brought to challenge the interpretation after seeking a determination of appealability by the Director of the National Appeals Division in accordance with 7 CFR part 11. Interpretations of procedure or policy provisions not codified in the Code of Federal Regulations are administratively appealable and the appeal provisions published at 7 CFR part 11 must be exhausted before any action for judicial review may be brought against FCIC.

    Environmental Evaluation

    This action is not expected to have a significant economic impact on the quality of the human environment, health, or safety. Therefore, neither an Environmental Assessment nor an Environmental Impact Statement is needed.

    Background

    FCIC proposes to revise the General and Administrative Regulations Subpart X—Interpretations of Statutory and Regulatory Provisions to provide requestors with information on how to request a final agency determination and an interpretation of procedures or policy provisions not codified in the Code of Federal Regulations within one administrative regulation. There are provisions in policies not codified in the Code of Federal Regulations that are identical to those in the Common Crop Insurance Basic Provisions (Basic Provisions) or Crop Provisions codified in the Code of Federal Regulations. In such instances, the requestor sought an interpretation of the applicable provision in the Basic Provisions and that interpretation was applicable to all policies that contained an identical provision. Nothing in this rule changes this process. However, there are numerous policies with provisions that are not codified in the Code of Federal Regulations in any policy. For these policy provisions, this rule provides a mechanism to obtain an interpretation of such provision.

    The rule will also clarify existing provisions, eliminate redundancies, remove or update obsolete references, simplify the regulation to address final agency determinations and interpretations of procedures or policy provisions not codified in the Code of Federal Regulations in the same regulation, simplify program administration, and improve clarity of the requestor and FCIC obligations. The proposed rule also incorporates the information formerly contained in Manager's Bulletin MGR-05-018 into subpart X for efficiency and ease of use. Manager's Bulletin MGR-05-018 currently provides criteria for requesting an interpretation of procedures when a requestor seeks an interpretation of the meaning or applicability of procedure used in administering the Federal crop insurance program. Accordingly, Manager's Bulletin MGR-05-018 will no longer be used upon issuance of the final rule to this proposed rule.

    The proposed rule amends the language to be consistent where possible and revises the regulation in plain language for ease of readability by the requestor.

    List of Subjects in 7 CFR Part 400

    Administrative practice and procedure, crop insurance, reporting and recordkeeping requirements.

    Proposed Rule

    Accordingly, as set forth in the preamble, the Federal Crop Insurance Corporation proposes to amend 7 CFR part 400 as follows:

    PART 400—GENERAL ADMINISTRATIVE REGULATIONS 1. The authority citation for 7 CFR part 400 continues to read as follows: Authority:

    7 U.S.C. 1506(1), 1506(o).

    2. Revise § Subpart X as follows: Subpart X—Interpretations of Statutory Provisions, Policy Provisions, and Procedures Sec. 400.765 Definitions. 400.766 Basis and Applicability. 400.767 Requestor Obligations. 400.768 FCIC Obligations.
    § 400.765 Definitions.

    Act. The Federal Crop Insurance Act, 7 U.S.C. 1501-1524.

    FCIC. The Federal Crop Insurance Corporation, a wholly owned government corporation within the United States Department of Agriculture.

    Final Agency Determination. An interpretation of provisions of the Act, regulations, or any policy provision that is codified in the Federal Register.

    Participant. Any applicant for Federal crop insurance, an insured, or a private insurance company with a reinsurance agreement with FCIC or their agent, loss adjuster, employee or contractor.

    Policy. The agreement to insure an agricultural commodity reinsured by FCIC under the provisions of the Federal Crop Insurance Act which consists of the accepted application, the applicable Basic Provisions, the Crop Provisions, the Special Provisions, the Commodity Exchange Price Provisions, if applicable, other amendments, endorsements, or options, the actuarial documents for the insured agricultural commodity, the Catastrophic Risk Protection Endorsement, if applicable, and the applicable regulations published in 7 CFR chapter IV.

    Procedure. All FCIC issued handbooks, manuals, memoranda, and bulletins for any crop insurance policy reinsured by FCIC.

    RMA. The Risk Management Agency, an agency of the United States Department of Agriculture.

    You. The requestor of a final agency determination or interpretation of procedure or policy provision not codified in the Code of Federal Regulations.

    § 400.766 Basis and Applicability.

    (a) The regulations contained in this subpart prescribe the rules and criteria for obtaining a final agency determination or an interpretation of a procedure or policy provision not codified in the Code of Federal Regulations.

    (1) FCIC will provide a final agency determination or an interpretation of procedure or policy provision not codified in the Code of Federal Regulations, as applicable, for policy provisions or procedures that were in effect during the four most recent calendar years from the calendar year in which your request was submitted. For example, for a request received in the 2014 calendar year, FCIC will consider requests for the 2014, 2013, 2012, and 2011.

    (2) If FCIC determines a request is outside the scope of crop years authorized in paragraph (a)(1) of this section, you will be notified within 30 days of the date of receipt by FCIC.

    (3) If the policy provisions or procedures have changed for the time period you seek an interpretation you must submit a separate request for each policy provision or procedure by year. For example, if you seek an interpretation of section 6(b) of the Small Grains Crop Provisions for the 2012 through 2015 crop years but the policy provisions were revised starting with the 2014 crop year. You must submit two requests, one for the 2012 and 2013 crop years and another for the 2014 and 2015 crop years.

    (b) With respect to a Final Agency Determination:

    (1) All final agency determinations issued by FCIC are binding on all participants in the Federal crop insurance program for the crop years the policy provisions are in effect. Unless appealed in accordance with paragraph (2), failure of the National Appeals Division, arbitrator, or mediator to adhere to the final agency determination provided under this subpart will result in the nullification of any award or agreement in arbitration or mediation.

    (2) All final agency determinations are considered matters of generally applicable and are not appealable to the National Appeals Division.

    (i) Before obtaining judicial review of any final agency determination, you must obtain an administrative final determination from the Director of the National Appeals Division on the issue of whether the final agency determination is a matter of general applicability.

    (ii) Any appeal of a final agency determination must be in accordance with 7 CFR 400.766(c)(4).

    (c) With respect to an interpretation of procedure or policy provision not codified in the Code of Federal Regulations:

    (1) If either you or any other does not agree with the written interpretation of procedure or policy provision not codified in the Code of Federal Regulations provided by FCIC, a request for administrative review may be filed in accordance with 7 CFR, part 400, subpart J. If you seek an administrative review from FCIC, such request must be submitted in in accordance with § 400.767(a).

    (2) FCIC will not accept requests for administrative review from the National Appeals Division, a mediator or arbitrator.

    (3) The RMA Office of the Deputy Administrator for Product Management will make a determination on the request for administrative review not later than 30 days after receipt of the request.

    (4) Regardless of whether you have sought administrative review, you may appeal an interpretation of procedure made by FCIC to the National Appeals Division in accordance with 7 CFR part 11.

    § 400.767 Requestor Obligations.

    (a) All requests for a final agency determination or an interpretation of procedure or policy provision not codified in the Code of Federal Regulations submitted under this subpart must:

    (1) Be submitted to the Deputy Administrator using the format provided on RMA's Web site at http://www.rma.usda.gov/regs/533/section533.html through one of the following methods:

    (i) In writing by certified mail or overnight delivery, to the Deputy Administrator, Risk Management Agency, United States Department of Agriculture, Beacon Facility, Stop 0801, Room 421, P.O. Box 419205, Kansas City, MO 64141-6205;

    (ii) By facsimile at (816) 926-1803; or

    (iii) By electronic mail at [email protected];

    (2) State whether you are seeking a final agency determination or an interpretation of procedure or policy provision not codified in the Code of Federal Regulations;

    (3) Identify and quote the specific provision in the Act, regulations, procedure, or policy provision for which you are requesting a final agency determination or an interpretation of procedure or policy provision not codified in the Code of Federal Regulations;

    (4) Contain no more than one request for an interpretation (You must make separate requests for each provision if more than one provision is at issue. For example, if there is a dispute with the interpretation of section 3 of the Loss Adjustment Manual, then one request for an interpretation is required. If there is a dispute with the interpretation of section 3 of the Loss Adjustment Manual and section 2 of the Macadamia Nut Loss Adjustment Standards Handbook, then two separate requests for an interpretation are required);

    (5) State the crop, crop year(s), and plan of insurance applicable to the request;

    (6) State the name, address, and telephone number of a contact person for the request; and

    (7) Contain your detailed interpretation of the specific provision of the Act, regulations, procedure, or policy provision for which the request for interpretation is being requested.

    (b) You may request a final agency determination or an interpretation of procedure or policy provision not codified in the Code of Federal Regulations, as applicable, only if you have legally filed or formally initiated a judicial review, mediation, or arbitration.

    (1) You must identify the type of proceeding (e.g. mediation, arbitration, or litigation) in which the interpretation will be used, and the date the proceeding is scheduled to begin, or the earliest possible date the proceeding would likely begin if a specific date has not been established;

    (2) The name, address, telephone number, and if applicable, fax number, or email address of a contact person for both parties to the proceeding;

    (3) Requests must be submitted not later than 90 days before the date the mediation, arbitration or litigation proceeding in which the interpretation will be used is scheduled to begin.

    (i) If the rules of the court, mediation, or arbitration require the interpretation prior to the date the proceeding begins, add 90 days to the number of days required prior to the proceeding. For example, if a court requires the interpretation 20 days prior to the date the proceeding begins, you must submit the request 110 days before the proceeding is scheduled to begin.

    (ii) Failure to timely submit a request for a final agency determination may result in:

    (A) FCIC issuing a determination that no interpretation could be made because the request was not timely submitted; and

    (B) Nullification of any agreement or award in accordance with the applicable Basic Provisions.

    (iii) If during the mediation, arbitration, or litigation proceeding, an issue arises that requires a final agency determination or an interpretation of procedure or policy provision not codified in the Code of Federal Regulations, the mediator, arbitrator, judge, or magistrate must promptly request a final agency determination or an interpretation of procedure or policy provision not codified in the Code of Federal Regulations in accordance with § 400.767(a).

    (4) FCIC at its sole discretion may authorize personnel to provide an oral or written interpretation, as appropriate; and

    (5) Any decision or settlement resulting from such mediation, arbitration, or litigation proceeding before FCIC provides its interpretation may not be binding on the parties.

    (c) If multiple parties are involved and have opposing interpretations a joint request for a final agency determination or an interpretation of procedure or policy provision not codified in the Code of Federal Regulations including both requestor interpretations in one request is encouraged. If multiple insured persons are parties to the proceedings, and the request for a final agency determination or an interpretation of procedure or policy provision not codified in the Code of Federal Regulations applies to all parties, one request may be submitted for all insured persons instead of separate requests for each person. In this case, the information required in this section must be provided for each person.

    § 400.768 FCIC Obligations.

    (a) FCIC reserves the right to not provide a final agency determination or an interpretation of procedure or policy provision not codified in the Code of Federal Regulations for any request regarding, or that contains specific factual information to situations or cases, such as acts or failures to act of any participant under the terms of a policy, procedure, or any reinsurance agreement.

    (1) Regardless of whether or not FCIC accepts a request, FCIC will not consider specific factual information to situations or cases in any final agency determination.

    (2) FCIC will not consider any examples provided in your interpretation because those are fact specific and could be construed as a finding of fact by FCIC. If an example is required to illustrate an interpretation, FCIC will provide the example in the interpretation.

    (b) If, in the sole judgment of FCIC, the request is unclear, ambiguous, or incomplete, FCIC will not provide a final agency determination or an interpretation of procedure or policy provision not codified in the Code of Federal Regulations but notify you within 30 days of the date of receipt by FCIC that the request is unclear, ambiguous, or incomplete.

    (c) If FCIC notifies you that a request is unclear, ambiguous or incomplete under § 400.768(b), the 90 day time period for FCIC to provide a response is stopped on the date FCIC notifies you. On the date FCIC receives a clear, complete, and unambiguous request, FCIC has the balance of the days remaining in the 90 day period to provide a response to you. For example, FCIC receives a request for a final agency determination on January 10. On February 10, FCIC notifies you the request is unclear. On March 10, FCIC receives a clarified request that meets all requirements for FCIC to provide a final agency determination. FCIC has sixty days from March 10, the balance of the 90 day period, to provide a response.

    (d) FCIC reserves the right to modify the request for a final agency determination into an interpretation of procedure or policy provision not codified in the Code of Federal Regulations as needed if the request pertains to procedures or uncodified policy provisions and contains the information required in § 400.767.

    (e) FCIC will provide you a written final agency determination or an interpretation of procedure or policy provision not codified in the Code of Federal Regulations within 90 days of the date of receipt for a request that meets all requirements in § 400.767.

    (f) If FCIC does not provide a response within 90 days of receipt of a request, you may assume your interpretation is correct for the applicable crop year. However, your interpretation shall not be considered generally applicable and shall not be binding on any other program participants. Additionally, in the case of a joint request for a final agency determination or an interpretation of procedure or policy provision not codified in the Code of Federal Regulations, if FCIC does not provide a response within 90 days, neither party may assume their interpretations are correct.

    (g) FCIC will publish all final agency determinations as specially numbered documents on the RMA Web site because they are generally applicable to all program participants.

    (h) FCIC will not publish any interpretation of procedure or policy provision not codified in the Code of Federal Regulations because they are only applicable to the parties in the dispute. You are responsible for providing copies of the interpretation of procedure or policy provision not codified in the Code of Federal Regulations to all other parties involved in the proceeding.

    (i) When issuing an interpretation, FCIC will not evaluate the insured, approved insurance provider, agent or loss adjuster as it relates to the performance of following FCIC policy provisions or procedures. Interpretations will not include any analysis of whether the insured, approved insurance provider, agent, or loss adjuster was in compliance with the policy provision or procedure in question.

    Signed in Washington, DC, on March 5, 2015. Brandon Willis, Manager, Federal Crop Insurance Corporation.
    [FR Doc. 2015-06224 Filed 3-17-15; 8:45 am] BILLING CODE 3410-08-P
    NUCLEAR REGULATORY COMMISSION 10 CFR Part 20 [NRC-2009-0279] RIN 3150-AJ29 Radiation Protection AGENCY:

    Nuclear Regulatory Commission.

    ACTION:

    Advance notice of proposed rulemaking; extension of comment period.

    SUMMARY:

    On July 25, 2014, the U.S. Nuclear Regulatory Commission (NRC) published for comment an advance notice of proposed rulemaking (ANPR) to obtain input from members of the public on the development of a draft regulatory basis. The draft regulatory basis would identify potential changes to the NRC's current radiation protection regulations. The potential changes, if implemented, would achieve a closer alignment between the NRC's radiation protection regulations and the recommendations of the International Commission on Radiological Protection (ICRP) contained in ICRP Publication 103 (2007). The NRC is extending the comment period for the ANPR to provide additional time for members of the public to develop and submit their comments.

    DATES:

    The comment period has been extended and expires on June 22, 2015. Comments received after this date will be considered if it is practical to do so, but the NRC is able to ensure consideration only for comments received on or before this date.

    ADDRESSES:

    You may submit comments by any of the following methods (unless this document describes a different method for submitting comments on a specific subject):

    • Federal Rulemaking Web site: Go to http://www.regulations.gov and search for Docket ID NRC-2009-0279. Address questions about NRC dockets to Carol Gallagher; telephone: 301-415-3463; email: [email protected] For technical questions, contact the individual listed in the FOR FURTHER INFORMATION CONTACT section of this document.

    • Email comments to: [email protected] If you do not receive an automatic email reply confirming receipt, then contact us at 301-415-1677.

    • Fax comments to: Secretary, U.S. Nuclear Regulatory Commission at 301-415-1101.

    • Mail comments to: Secretary, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001, ATTN: Rulemakings and Adjudications Staff.

    • Hand deliver comments to: 11555 Rockville Pike, Rockville, Maryland 20852, between 7:30 a.m. and 4:15 p.m. (Eastern Time) Federal workdays; telephone: 301-415-1677.

    For additional direction on obtaining information and submitting comments, see “Obtaining Information and Submitting Comments” in the SUPPLEMENTARY INFORMATION section of this document.

    FOR FURTHER INFORMATION CONTACT:

    Cardelia Maupin, Office of Nuclear Material Safety and Safeguards, U.S. Nuclear Regulatory Commission, Washington, DC 20555-0001; telephone: 301-415-2312; email: [email protected]

    SUPPLEMENTARY INFORMATION:

    I. Obtaining Information and Submitting Comments A. Obtaining Information

    Please refer to Docket ID NRC-2009-0279 when contacting the NRC about the availability of information regarding this document. You may obtain publicly-available information related to this document by any of the following methods:

    • Federal Rulemaking Web site: Go to http://www.regulations.gov and search for Docket ID NRC-2009-0279.

    • NRC's Agencywide Documents Access and Management System (ADAMS): You may obtain publicly-available documents online in the ADAMS Public Documents collection at http://www.nrc.gov/reading-rm/adams.html. To begin the search, select “ADAMS Public Documents” and then select “Begin Web-based ADAMS Search.” For problems with ADAMS, please contact the NRC's Public Document Room (PDR) reference staff at 1-800-397-4209, 301-415-4737, or by email to [email protected] The ANPR document is available in ADAMS under Accession No. ML14183B023.

    • NRC's PDR: You may examine and purchase copies of public documents at the NRC's PDR, Room O1-F21, One White Flint North, 11555 Rockville Pike, Rockville, Maryland 20852.

    B. Submitting Comments

    Please include Docket ID NRC-2009-0279 in your comment submission.

    The NRC cautions you not to include identifying or contact information that you do not want to be publicly disclosed in your comment submission. The NRC will post all comment submissions at http://www.regulations.gov as well as enter the comment submissions into ADAMS. The NRC does not routinely edit comment submissions to remove identifying or contact information.

    If you are requesting or aggregating comments from other persons for submission to the NRC, then you should inform those persons not to include identifying or contact information that they do not want to be publicly disclosed in their comment submission. Your request should state that the NRC does not routinely edit comment submissions to remove such information before making the comment submissions available to the public or entering the comment submissions into ADAMS.

    II. Further Information

    On July 25, 2014 (79 FR 43284), the NRC published for comment an ANPR to obtain input from members of the public on the development of a draft regulatory basis. The draft regulatory basis would identify potential changes to the NRC's current radiation protection regulations. The potential changes, if implemented, would achieve a closer alignment between the NRC's radiation protection regulations and the recommendations in ICRP Publication 103 (2007). The ANPR identifies specific questions and issues with respect to a possible revision of the NRC's radiation protection requirements. Comments, including responses to the specific questions, will be considered by the NRC staff when it develops the draft regulatory basis.

    The Part 20 of Title 10 of the Code of Federal Regulations (10 CFR) ANPR public comment period was originally scheduled to close on November 24, 2014, after a 120-day comment period. In response to several requests from members of the public received throughout November 2014, the NRC extended the public comment period on the ANPR, by an additional 120 days, to March 24, 2015 (79 FR 69065; November 20, 2014).

    In response to a second request, dated February 18, 2015, from several members of the public, the NRC is now extending the public comment period by an additional 90 days. The deadline for submitting comments is now extended from March 24, 2015, to June 22, 2015.

    Dated at Rockville, Maryland, this 11th day of March 2015.

    For the Nuclear Regulatory Commission,

    Laura A. Dudes, Director, Division of Material Safety, State, Tribal and Rulemaking Programs, Office of Nuclear Material Safety and Safeguards.
    [FR Doc. 2015-06244 Filed 3-17-15; 8:45 am] BILLING CODE 7590-01-P
    SMALL BUSINESS ADMINISTRATION 13 CFR Part 107 RIN 3245-AG68 Small Business Investment Companies—Early Stage AGENCY:

    U.S. Small Business Administration.

    ACTION:

    Advance Notice of Proposed Rulemaking (ANPRM).

    SUMMARY:

    The U.S. Small Business Administration (SBA) is seeking input and comments on its Early Stage Small Business Investment Company (SBIC) initiative, promulgated in the final rule on April 27, 2012. The intent of the initiative was to license and provide SBA leverage to SBICs over a 5-year period (fiscal years 2012 through 2016) that would focus on making investments in early stage small businesses. Although 58 investment funds applied to the program, to date SBA has only licensed 5 Early Stage SBICs. SBA is seeking input from the public to determine whether existing market conditions warrant SBA continuing to license Early Stage SBICs past fiscal year 2016 on an ongoing basis and, if so, what changes should be made to the program to attract qualified early stage fund managers.

    DATES:

    Comments must be received on or before May 18, 2015.

    ADDRESSES:

    You may submit comments, identified by RIN 3245-AG68, by any of the following methods:

    • Federal Rulemaking Portal: http://www.regulations.gov. Please follow the instructions for submitting comments.

    • Mail, Hand Delivery/Courier: Javier Saade, Associate Administrator for the Office of Investment and Innovation, U.S. Small Business Administration, 409 Third Street SW., Washington, DC 20416.

    SBA will post comments on this Advance Notice of Proposed Rulemaking on http://www.regulations.gov. If you wish to submit confidential business information (CBI) as defined in the User Notice at http://www.regulations.gov, please submit the information to Theresa Jamerson, Office of Investment and Innovation, 409 Third Street SW., Washington, DC 20416. Highlight the information that you consider to be CBI and explain why you believe this information should be held confidential. SBA will review your information and determine whether it will make the information public.

    FOR FURTHER INFORMATION CONTACT:

    Theresa Jamerson, Office of Investment and Innovation, (202) 205-7563.

    SUPPLEMENTARY INFORMATION:

    I. Background Information

    Early Stage Small Business Investment Company Initiative. In the Small Business Investment Act of 1958 (the Act), Congress created the Small Business Investment Company (SBIC) program to “stimulate and supplement the flow of private equity capital and long-term loan funds which small-business concerns need for the sound financing of their business operations and for their growth, expansion, and modernization, and which are not available in adequate supply. * * *” 15 U.S.C. 661. Congress intended that the program “be carried out in such manner as to insure the maximum participation of private financing sources.” Id. In accordance with that policy, the U.S. Small Business Administration (SBA), through the SBIC program, does not invest directly in small businesses, but provides leverage to SBICs, privately-owned and professionally managed for-profit investment funds licensed by SBA, by guaranteeing the payment of debentures issued by SBICs (Debentures). These SBICs in turn make loans to, and investments in, qualifying small businesses.

    Since Fiscal Year (FY) 2000, the SBIC Debenture program has operated at zero subsidy cost, meaning that expected losses to the program's portfolio must be fully recouped through the collection of SBIC leverage fees in order to keep the program at zero subsidy cost to the taxpayer. By statute, SBIC leverage fees include a 1% commitment fee, a 2% draw fee, and an annual charge set at the time of commitment and paid on outstanding leverage in conjunction with interest payments. 15 U.S.C. 683(i). The annual charge is formulated each year to keep the program at zero subsidy cost, but may not, by statute, exceed 1.38%. 15 U.S.C. 683(b). Because the standard Debenture (Current Pay Debenture) requires semi-annual interest payments, most SBICs structure their investments as loans or mezzanine debt to finance later stage small businesses with positive operating cash flow so that they can meet requisite interest payments.

    On April 27, 2012, SBA published a final rule (77 FR 25042) to define a new sub-category of SBICs as part of President Obama's Start-up America initiative. SBA's intent was to license over a 5-year period (fiscal years 2012 through 2016) venture funds focused on early stage businesses and to guarantee Debentures in an amount up to one-half of each fund's total capitalization. SBA allocated $1 billion of its SBIC Debenture leverage authorization over these years to this effort.

    Although SBA has received 58 applications to the Early Stage SBIC program, to date, SBA has only licensed 5 Early Stage SBICs due to the quality of the application pool and SBA's rigorous licensing standards. SBA is seeking input on whether a market need for the program remains and, if so, what changes should SBA consider in order to attract Early Stage fund managers with successful track records.

    Early Stage SBIC Key Requirements Summary. Current regulations identify special requirements for Early Stage SBICs to manage the risk associated with these funds investing in seed and early stage businesses, including the following:

    (1) Licensing Process—§ 107.310: SBA uses a call process rather than accepting rolling applications as in the regular SBIC program.

    (2) Required Investments—§ 107.1120(k): Early Stage SBICs must invest at least 50% of aggregate financing dollars into Early Stage companies, as defined in § 107.50, but generally defined as companies that have not yet achieved positive operating cash flow as of the date of the initial investment.

    (3) Minimum Regulatory Capital—§ 107.210(3): Early Stage SBICs must have at least $20 million in Regulatory Capital (qualifying Private Capital as defined in § 107.50).

    (4) Leverage:

    (a) Maximum Leverage—§ 107.1150: Early Stage SBICs may qualify for leverage up to 100% of Regulatory Capital (also called “one tier of leverage”), not to exceed $50 million.

    (b) SBA Leverage Fees—§ 107.1130: All SBICs issuing Debentures, including Early Stage SBICs, must pay 3% in up-front fees (1% at commitment and 2% at draw) and an additional SBA fee, not to exceed 1.38 percent per annum, on outstanding Debentures paid at the same time as interest.

    (c) Type of Leverage: Early Stage SBICs may choose from two types of leverage both with ten year maturities and subject to Early Stage Distribution rules:

    (i) Early Stage Current Pay Debenture: Requires quarterly payments for interest and SBA annual fees. Early Stage SBICs choosing to use the Current Pay Debenture are required to maintain a 5-year interest reserve per § 107.1181. The interest reserve may include unfunded commitments or cash reserves which could be funded from Debenture proceeds. The interest reserve is intended to provide a pool of funds from which Early Stage SBICs can pay interest and annual fees while their investments mature.

    (ii) Discounted/Accruing Debenture: Debenture issued at a discount of 5 years of annual fees and interest charges, so that the amount owed accrues over a 5-year period to face value. After the 5-year period, quarterly payments for interest and annual fees must be paid on an ongoing basis.

    (5) Distribution Rules—§ 107.1180: Before an Early Stage SBIC with outstanding leverage may distribute to its investors, it must first pay all required SBA interest and charges and any leverage principal due at maturity. After those payments are made, if the Early Stage SBIC's capital impairment percentage, defined in § 107.1840, is 50 percent or more, and the SBIC's leverage ratio (defined as outstanding leverage to Leverageable Capital) exceeds 0.5, it must repay all outstanding SBIC Debentures before distributing to private investors. Otherwise, the Early Stage SBIC must repay SBA leverage, at a minimum, pro rata (in proportion) with any distributions returned to private investors on a cumulative basis.

    (6) Restrictions on Third-Party Debt—§ 107.565: Early Stage SBICs must seek SBA's prior written approval before incurring any third-party debt, except for accounts payable from routine business operations.

    (7) Capital Impairment Percentage (CIP) §§ 107.1830-1850: CIP is the primary financial metric SBA uses to evaluate an SBIC's ability to repay its leverage. CIP measures the losses incurred by an SBIC relative to its Regulatory Capital. If an SBIC exceeds its maximum allowable CIP, SBA has the right to, among other things, declare the entire indebtedness of the SBIC's Debentures immediately due and payable; and institute proceedings for the appointment of SBA as receiver of the SBIC. Because Early Stage SBICs are limited to one tier of leverage, the maximum allowable CIP ranges from 45% to 70%, depending on the percentage of equity. If the percentage of equity investments at cost exceeds 67%, the maximum allowable CIP would be 70%.

    II. Market Gap

    (1) Market Need. According to data from PricewaterhouseCoopers Moneytree (https://www.pwcmoneytree.com/), financings to seed and early stage companies by venture funds has grown from $2.16 billion in the first quarter of calendar year 2012 to over $4 billion in the second quarter of calendar year 2014, the highest amount in any quarter since 2000. As a federal credit program, SBA seeks to direct capital to gaps in the marketplace. Given the growth in early stage financings since 2012, SBA is trying to determine whether it should continue to license Early Stage SBICs past 2016. SBA is seeking input from the public with regard to the following questions:

    (a) Are there barriers preventing promising early stage small businesses from being financed, and, if so, what are the barriers?

    (b) Are there gaps in the financial markets with regard to financing early stage or seed companies in the United States? If so, what evidence exists to identify and verify these gaps?

    (c) If there are no or limited gaps in the financial markets for early stage and seed companies in the United States, should SBA continue the Early Stage SBIC program past 2016, but issue a call for Early Stage SBIC applications only if and when identifiable market gaps occur? If so, what evidence should SBA use to identify declining market conditions or gaps in the market?

    (2) Targeted Early Stage SBIC Participants. The Early Stage SBIC initiative focused on more established and traditional early stage venture funds to participate in the program because these funds' investment strategy effectively utilizes SBA's leverage to finance small businesses. SBA recognizes that many early stage and seed businesses may obtain capital from other sources than traditional early stage/seed venture funds. Accelerator funds, incubators, angel investment funds or other types of similar funds—venture capital funds that generally make a substantial number of relatively small-dollar equity investments in seed and early stage businesses—have not demonstrated significant interest in SBA's Early Stage SBIC initiative. Could these funds effectively utilize Debenture leverage as part of their investment strategy in a way that would not increase the risk profile of the SBIC program. What changes to the Early Stage SBIC program would SBA need to make in order to attract qualified funds that use this investment strategy? Would the minimum regulatory capital need to be changed? Would the leverage terms need to be changed? What data is available to assess the risk associated with these types of funds?

    III. Early Stage SBIC Program Structure

    (1) Fund-Level Debt Versus Equity. Based on discussions with early stage fund managers and limited partners, SBA understands that most early stage funds would prefer equity rather than fund-level debt. However, SBA is only authorized to guarantee SBIC Debentures for its licensed funds. SBA also recognizes the potential mismatch between Debenture leverage and early stage portfolio company cash flows. Because most early stage portfolio companies do not have the cash flow to service debt, most early stage financings are structured as equity. SBA tried to compensate for this in the Early Stage SBIC program by implementing a discounted debenture in which leverage is issued at a discount and interest and charges accrue for 5 years before the fund would be required to make payments on a quarterly basis. Alternatively, Early Stage SBICs could use the Current Pay Debenture and pay interest and charges on a quarterly basis using the required interest reserve.

    SBA has heard from members of the venture capital industry that many early stage funds are not interested in leverage. SBA seeks input from the public on whether fund-level debt is of use to early stage fund managers or whether concerns exist with regard to current SBIC Early Stage Debenture leverage terms.

    (2) Early Stage SBIC Leverage Terms. Early Stage SBICs are expected to have significantly higher losses than regular SBICs, due to the risk associated with their portfolios. SBA structured the Early Stage SBIC program so that it could be run with minimum impact to the regular SBIC Debenture program. This includes limiting the amount of Early Stage leverage as a percentage of the overall SBIC portfolio. Key Early Stage SBIC requirements are summarized in Section I of this ANPRM. SBA seeks input from the public to identify how Early Stage SBIC requirements could be improved without increasing SBA's credit risk. In particular, SBA has the following questions:

    (a) Minimum Regulatory Capital: Currently, Early Stage SBICs must have at least $20 million in Regulatory Capital. Should SBA modify this Regulatory Capital requirement in order to improve the number of qualified applicants to the program?

    (b) Maximum Leverage: SBA set the maximum leverage for Early Stage SBICs at $50 million based on its overall allocation of $200 million per year, in order to provide some level of portfolio diversification. Should SBA increase the maximum leverage available to Early Stage SBICs, for example, to $100 million, approximately half of any year's allocation?

    (c) Maximum Leverage Ratio: Currently, SBA provides up to one tier of leverage, not to exceed the maximum, in order to limit its credit risk. Should SBA lower the maximum leverage ratio to help further reduce its credit risk? What maximum leverage ratio is appropriate?

    (d) Interest Reserve: If Early Stage SBICs use the Current Pay Debenture, they must maintain a 5-year interest reserve to make interest and annual charge payments. SBA set this interest reserve to make sure that Early Stage SBICs would have sufficient funds to make required interest payments for the first 5 years and to lower the overall loss rate. Would removing the interest reserve attract more qualified applicants? If so, since the interest reserve was put in place to mitigate SBA's risk and limit the increase to the SBIC Debenture annual charge, what actions should SBA consider to help mitigate SBA's risk?

    (3) Other Early Stage SBIC Regulations. SBA invites comments on other aspects of Early Stage regulations, including the following:

    (a) Licensing Process: Would a rolling licensing process (where SBA accepts applications throughout the year) versus the Early Stage Call process, identified in § 107.310, be preferred and/or attract more qualified applicants to the program?

    (b) Third-Party Debt: Do third-party debt restrictions identified in § 107.565 detract from the program and what changes could be made to achieve the same credit risks for SBA?

    (4) Other SBIC Regulations and Guidelines. SBA also invites comments on other SBIC regulatory requirements as identified in 13 CFR part 107 that may be of particular concern to Early Stage SBIC applicants. For example, some Early Stage SBICs and potential applicants have indicated concerns with SBA's Valuation Guidelines (http://www.sba.gov/content/valuation-guidelines-sbics). SBA is interested in feedback as to what those concerns are and what changes industry members would recommend.

    Dated: March 11, 2015. Maria Contreras-Sweet, Administrator.
    [FR Doc. 2015-06182 Filed 3-17-15; 8:45 am] BILLING CODE 8025-01-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 70 [EPA-R03-OAR-2015-0119; FRL-9924-56-Region 3] Clean Air Act Title V Operating Permit Program Revision; Pennsylvania AGENCY:

    Environmental Protection Agency (EPA).

    ACTION:

    Proposed rule.

    SUMMARY:

    EPA is proposing to approve a revision to the Pennsylvania Title V Operating Permit Program submitted by the Commonwealth of Pennsylvania on February 11, 2014. The Pennsylvania Operating Permit Program is implemented through its Title V Operating Permits Rule, codified at Subchapter G of Chapter 127 of Title 25 of the Pennsylvania Code. The February 11, 2014 revision amends the title V fee program that funds the Pennsylvania Title V Operating Permit Program. These changes resulted in substantial revisions to Pennsylvania's Title V Operating Permit Program. EPA is proposing to approve these revisions. The intended effect of this action is to improve the Commonwealth's title V operating permit program.

    DATES:

    Written comments must be received on or before April 17, 2015.

    ADDRESSES:

    Submit your comments, identified by Docket ID Number EPA-R03-OAR-2015-0119 by one of the following methods:

    A. www.regulations.gov. Follow the on-line instructions for submitting comments.

    B. Email: [email protected].

    C. Mail: EPA-R03-OAR-2015-0119, David Campbell, Associate Director, Office of Permits and Air Toxics, Mailcode 3AP10, U.S. Environmental Protection Agency, Region III, 1650 Arch Street, Philadelphia, Pennsylvania 19103.

    D. Hand Delivery: At the previously-listed EPA Region III address. Such deliveries are only accepted during the Docket's normal hours of operation, and special arrangements should be made for deliveries of boxed information.

    Instructions: Direct your comments to Docket ID No. EPA-R03-OAR-2015-0119. EPA's policy is that all comments received will be included in the public docket without change, and may be made available online at www.regulations.gov, including any personal information provided, unless the comment includes information claimed to be Confidential Business Information (CBI) or other information whose disclosure is restricted by statute. Do not submit information that you consider to be CBI, or otherwise protected, through www.regulations.gov or email. The www.regulations.gov Web site is an “anonymous access” system, which means EPA will not know your identity or contact information unless you provide it in the body of your comment. If you send an email comment directly to EPA without going through www.regulations.gov, your email address will be automatically captured and included as part of the comment that is placed in the public docket and made available on the Internet. If you submit an electronic comment, EPA recommends that you include your name and other contact information in the body of your comment and with any disk or CD-ROM you submit. If EPA cannot read your comment due to technical difficulties and cannot contact you for clarification, EPA may not be able to consider your comment. Electronic files should avoid the use of special characters, any form of encryption, and be free of any defects or viruses.

    Docket: All documents in the electronic docket are listed in the www.regulations.gov index. Although listed in the index, some information is not publicly available, i.e., CBI or other information whose disclosure is restricted by statute. Certain other material, such as copyrighted material, is not placed on the Internet and will be publicly available only in hard copy form. Publicly available docket materials are available either electronically in www.regulations.gov or in hard copy during normal business hours at the Air Protection Division, U.S. Environmental Protection Agency, Region III, 1650 Arch Street, Philadelphia, Pennsylvania 19103. Copies of the State submittal are available at the Pennsylvania Department of Environmental Protection, Bureau of Air Quality Control, P.O. Box 8468, 400 Market Street, Harrisburg, Pennsylvania 17105.

    FOR FURTHER INFORMATION CONTACT:

    Gerallyn Duke, (215) 814-2084, or by email at [email protected]

    SUPPLEMENTARY INFORMATION: I. Background

    EPA granted full approval of the Pennsylvania Title V Operating Permits Program on July 30, 1996. See 61 FR 39597. Under 40 CFR 70.9(a) and (b), an approved state title V operating permits program must require that the owners or operators of part 70 sources pay annual fees, or the equivalent over some other period, that are sufficient to cover the permit program costs and ensure that any fee required under 40 CFR 70.9 is used solely for permit program costs. The fee schedule must result in the collection and retention of revenues sufficient to cover the permit program costs.

    Pennsylvania's initial title V permit emission fee, established in 1994 at 25 PA Code 127.705, was $37 per ton of regulated pollutant per title V facility. Pennsylvania's fee has been increased each year since 1994 by the percentage, if any, by which the Consumer Price Index (CPI) for the most recent calendar year exceeded the CPI for the previous calendar year. Under that regulatory framework, the annual emission fee for emissions occurring in calendar year 2012 was $57.50 per ton of regulated pollutant for emissions of up to 4,000 tons of each regulated pollutant. The fee structure has not been revised since 1994.

    Pennsylvania has determined that title V annual emission fee revenues collected are no longer sufficient to cover title V program costs. Installation of air pollution control technology over the past two decades on major stationary sources, the retirement or curtailment of operations by major sources, and the conversion at many major facilities from burning coal or oil to burning natural gas have resulted in decreased emission of regulated pollutants that are subject to annual emission fees, and revenues collected have been decreasing as a result. The decline in interest rates paid on savings account balances used by the Commonwealth to manage permit fees collected also has affected the funds available to Pennsylvania, as the investments earn less interest in the current economy compared to the early years of the title V program. Pursuant to 40 CFR 70.4(i)(2), when EPA receives a title V program revision, EPA will publish its proposed approval or disapproval in the Federal Register and provide opportunity for comment.

    II. Summary of Program Revision

    In the February 11, 2014 program revision, Pennsylvania has included revised 25 PA Code 127.705 which Pennsylvania has amended to increase Pennsylvania's annual emission fees. Fees are increased to $85 per ton of emissions for emissions from title V sources of up to 4,000 tons of each regulated pollutant. The provisions for increasing the annual emissions fees in response to increases in the CPI at 25 PA Code 127.705(d) remain unchanged. The revised fees are designed to cover all reasonable costs required to develop and administer the title V program as required by 40 CFR 70.9(a) and (b). These costs include those for activities such as reviewing and processing plan approvals and operating permits, conducting inspections, responding to complaints and pursuing enforcement actions, emissions and ambient air monitoring, preparing applicable regulations and guidance, modeling, analyses, demonstrations, emission inventories, and tracking emissions.

    Without this fee increase, Pennsylvania anticipates funds will not be sufficient to sustain the title V permitting program beginning fiscal years 2015-2016. If funds become insufficient to sustain the title V permitting program in Pennsylvania, EPA may determine that Pennsylvania has not taken “significant action to assure adequate administration and enforcement of the Program” and take subsequent required action under 40 CFR 70.10(b) and(c) as well as impose mandatory and discretionary sanctions under the CAA.

    III. EPA Analysis of Program Revision

    The February 11, 2014 Title V Operating Permit Program revision consists of amendments to Pennsylvania's rules which establish annual emission fees under title V of the CAA. This rulemaking proposes approval of the increase to the annual title V fees paid by the owner or operator of a title V facility from $57.50 per ton of regulated air pollutant to $85 per ton because the revision meets requirements in 40 CFR 70.9 for sufficient title V fees to cover permit program costs. The emission fees apply to emissions up to 4,000 tons of any regulated pollutant. The proposed revision does not establish a fee structure for carbon dioxide or other greenhouse gases (GHGs). EPA's rules do not mandate revisions to state title V programs to account for GHG emissions.

    IV. Proposed Action

    Pursuant to 40 CFR 70.4(i)(2), EPA is proposing to approve the Pennsylvania Title V Operating Program revision submitted on February 11, 2014 to increase the annual title V fees paid by the owners or operators of all title V facilities throughout Pennsylvania, including Allegheny and Philadelphia Counties, from $57.50 per ton of regulated air pollutant to $85 per ton. The revision meets requirements in 40 CFR 70.9. EPA is soliciting public comments on the issues discussed in this document. These comments will be considered before taking final action.

    V. Statutory and Executive Order Reviews

    This proposed action merely proposes to approve state law as meeting Federal requirements and imposes no additional requirements beyond those imposed by state law. For that reason, this proposed action:

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

    • does not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);

    • is certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.);

    • does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4);

    • does not have Federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999);

    • is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997);

    • is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);

    • is not subject to requirements of Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) because application of those requirements would be inconsistent with the CAA; and

    • does not provide EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).

    In addition, this proposed rule related to Pennsylvania title V fees does not have tribal implications as specified by Executive Order 13175 (65 FR 67249, November 9, 2000), because the program is not approved to apply in Indian country located in the state, and EPA notes that it will not impose substantial direct costs on tribal governments or preempt tribal law.

    List of Subjects in 40 CFR Part 70

    Environmental protection, Administrative practice and procedure, Air pollution control, Carbon monoxide, Intergovernmental relations, Lead, Nitrogen dioxide, Ozone, Particulate matter, Reporting and recordkeeping requirements, Sulfur oxides, Volatile organic compounds.

    Authority:

    42 U.S.C. 7401 et seq.

    Dated: March 6, 2015. William C. Early, Acting, Regional Administrator, Region III.
    [FR Doc. 2015-06145 Filed 3-17-15; 8:45 am] BILLING CODE 6560-50-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 52 [EPA-R10-OAR-2014-0532, FRL-9924-72-Region 10] Approval and Promulgation of Implementation Plans; Alaska AGENCY:

    Environmental Protection Agency.

    ACTION:

    Proposed rule.

    SUMMARY:

    The Environmental Protection Agency (EPA) is proposing to approve and incorporate by reference revisions to the Alaska State Implementation Plan (SIP) submitted on July 1, 2014 and October 24, 2014. These revisions primarily update the adoption by reference of Federal regulations and definitions into the Alaska SIP. The revisions also clarify stationary source permitting rules governing owner-requested emission limits and revise the SIP to reflect the redesignation of the Eagle River area of Anchorage. Upon final action, the Alaska SIP will be updated to reflect recent Federal regulatory changes and actions.

    DATES:

    Comments must be received on or before April 17, 2015.

    ADDRESSES:

    Submit your comments, identified by Docket ID No. EPA-R10-OAR-2014-0532, by any of the following methods:

    www.regulations.gov: Follow the on-line instructions for submitting comments.

    Mail: Kristin Hall, EPA Region 10, Office of Air, Waste and Toxics (AWT-150), 1200 Sixth Avenue, Suite 900, Seattle WA, 98101.

    Email: [email protected]

    Hand Delivery: EPA Region 10 Mailroom, 9th Floor, 1200 Sixth Avenue, Suite 900, Seattle WA, 98101. Attention: Kristin Hall, Office of Air, Waste and Toxics, AWT-150. Such deliveries are only accepted during normal hours of operation, and special arrangements should be made for deliveries of boxed information.

    Instructions: Direct your comments to Docket ID No. EPA-R10-OAR-2014-0532. The EPA's policy is that all comments received will be included in the public docket without change and may be made available online at www.regulations.gov, including any personal information provided, unless the comment includes information claimed to be Confidential Business Information (CBI) or other information the disclosure of which is restricted by statute. Do not submit information that you consider to be CBI or otherwise protected through www.regulations.gov or email. The www.regulations.gov Web site is an “anonymous access” system, which means the EPA will not know your identity or contact information unless you provide it in the body of your comment. If you send an email comment directly to the EPA without going through www.regulations.gov your email address will be automatically captured and included as part of the comment that is placed in the public docket and made available on the Internet. If you submit an electronic comment, the EPA recommends that you include your name and other contact information in the body of your comment and with any disk or CD-ROM you submit. If the EPA cannot read your comment due to technical difficulties and cannot contact you for clarification, the EPA may not be able to consider your comment. Electronic files should avoid the use of special characters, any form of encryption, and be free of any defects or viruses.

    Docket: All documents in the electronic docket are listed in the www.regulations.gov index. Although listed in the index, some information is not publicly available, i.e., CBI or other information the disclosure of which is restricted by statute. Certain other material, such as copyrighted material, is not placed on the Internet and will be publicly available only in hard copy form. Publicly available docket materials are available either electronically in www.regulations.gov or in hard copy during normal business hours at the Office of Air, Waste and Toxics, EPA Region 10, 1200 Sixth Avenue, Seattle WA, 98101.

    FOR FURTHER INFORMATION CONTACT:

    Kristin Hall at telephone number: (206) 553-6357, email address: [email protected], or the above EPA, Region 10 address.

    SUPPLEMENTARY INFORMATION:

    Throughout this document wherever “we”, “us” or “our” is used, it is intended to refer to the EPA.

    Table of Contents I. Background II. EPA Evaluation of Alaska SIP Revisions III. Proposed Action IV. Incorporation by Reference V. Statutory and Executive Order Reviews I. Background

    Section 110 of the Clean Air Act (CAA) specifies the general requirements for states to submit SIPs to implement, maintain and enforce the National Ambient Air Quality Standards (NAAQS) and the EPA's actions regarding approval of those SIPs. On July 1, 2014 and October 24, 2014, the Alaska Department of Environmental Conservation (ADEC), on behalf of the Governor of Alaska, submitted SIP revisions to the EPA to account for regulatory updates effective October 6, 2013 and November 9, 2014, respectively. These revisions update Alaska Administrative Code Title 18 Environmental Conservation, Chapter 50 Air Quality Control (18 AAC 50) to reflect the adoption by reference of Federal regulations and definitions into the Alaska SIP, and edit associated cross-references to definitions. The revisions also clarify stationary source permitting rules governing owner-requested emission limits, and update the SIP to reflect the redesignation of the Eagle River area of Anchorage to attainment for particulate matter with an aerodynamic diameter less than or equal to a nominal 10 micrometers (PM10).

    We note that this action does not address the portions of the July 1, 2014, and October 24, 2014, SIP submittals related to Alaska's nonattainment new source review permitting program. The nonattainment new source review permitting rule updates submitted as part of these revisions were approved in a previous action on January 7, 2015 (80 FR 832). In this action, we are proposing to approve the remainder of the revisions to the Alaska SIP submitted on July 1, 2014 and October 24, 2014. Please see below for our evaluation.

    II. EPA Evaluation of Alaska SIP Revisions A. 18 AAC 50.015—Air Quality Designations, Classifications and Control Regions

    On January 7, 2013, the EPA approved the maintenance plan submitted by ADEC for the Eagle River PM10 nonattainment area and its accompanying request to redesignate the area to attainment for the PM10 NAAQS (78 FR 900). The redesignation became effective on March 8, 2013. Accordingly, in the July 1, 2014, submittal, ADEC revised 18 AAC 50.015 “Air Quality Designations, Classifications, and Control Regions” to reflect the change. We are proposing to approve the revision to this rule.

    B. 18 AAC 50.040—Federal Standards Adopted by Reference Guideline on Air Quality Modeling

    In the July 1, 2014, submittal, ADEC revised and submitted changes to 18 AAC 50.040 “Federal Standards Adopted by Reference” to update the citation dates incorporating by reference certain Federal requirements into the Alaska SIP. Specifically, ADEC submitted the updated adoption by reference of 40 CFR part 51, Appendix W “Guideline on Air Quality Models” revised as of July 1, 2012. We are proposing to approve this revision as consistent with Federal requirements.

    Prevention of Significant Deterioration (PSD)

    ADEC also submitted the updated incorporation by reference of Federal PSD permitting regulations at 40 CFR 51.166 and 40 CFR 52.21, revised as of April 1, 2013, which are referenced in ADEC's major source permitting rules in 18 AAC Chapter 50, Article 3, and relied on to implement ADEC's SIP-approved PSD permitting program. ADEC excluded from its submittal certain PSD permitting provisions in 40 CFR 51.166 and 40 CFR 52.21 that have been vacated by recent Court decisions, and those provisions are therefore not before the EPA for approval. Specifically, in response to the Court vacatur of the EPA PM2.5 significant monitoring concentration (SMC) and significant impact level (SIL) regulations, ADEC did not submit to the EPA for approval the provisions in the Alaska SIP impacted by the Court decision (18 AAC 50.040(h)(7) and (9)). ADEC's July 1, 2014, submittal cover letter confirms that ADEC intends to act in accordance with the Court vacatur, and that, although these provisions have not yet been repealed and remain in effect as a matter of State law, ADEC will not apply either the PM2.5 SMC provisions at 40 CFR 51.166(i)(5)(i)(c) and 52.21 (i)(5)(i)(c), or the PM2.5 SIL provisions at 40 CFR 51.166(k)(2) and 52.21(k)(2) in implementing the State new source permitting program. For a more detailed discussion of this issue, please see our previous action addressing revisions to the State PSD program (proposed May 5, 2014, 79 FR 25533; finalized September 19, 2014, 79 FR 56268).

    ADEC also excluded from its submittals the greenhouse gas (GHG) regulatory provision at 40 CFR 52.21(b)(49)(v) that was recently vacated by the Supreme Court and that is adopted by reference in 18 AAC 50.040(h)(4), effective October 6, 2013. On June 3, 2010, the EPA revised Federal PSD permitting rules addressing the application of the requirements to GHG emissions (GHG Tailoring Rule) (75 FR 31514). However, on June 23, 2014, the Supreme Court, in Utility Air Regulatory Group v. Environmental Protection Agency, 1 issued a decision addressing the application of PSD permitting requirements to GHG emissions. The Court said that the EPA may not treat GHGs as an air pollutant for purposes of determining whether a source is a major source (or modification thereof) required to obtain a PSD permit. The Court also said that the EPA could continue to require that PSD permits, otherwise required based on emissions of pollutants other than GHGs, contain limitations on GHG emissions based on the application of best available control technology. In order to act consistently with its understanding of the Court's decision pending further judicial action before the U.S. Court of Appeals for the District of Columbia to effectuate the decision, the EPA is not continuing to apply the EPA regulations that would require that SIPs include permitting requirements that the Supreme Court found impermissible. Specifically, the EPA is not applying the requirement that a state's SIP-approved PSD program require that sources obtain PSD permits when GHGs are the only pollutant (i) that the source emits or has the potential to emit above the major source thresholds, or (ii) for which there is a significant emissions increase and a significant net emissions increase from a modification (e.g. 40 CFR 51.166(b)(48)(v)).

    1 134 S.Ct. 2427 (2014).

    The EPA anticipates a need to revise Federal PSD rules in light of the Supreme Court decision. In addition, the EPA anticipates that many states will revise their existing SIP-approved PSD programs in light of the Supreme Court's decision. The timing and content of subsequent EPA actions with respect to the EPA regulations is expected to be informed by additional legal processes before the D.C. Circuit. The EPA is not expecting states to have revised their existing PSD program regulations at this juncture, before the D.C. Circuit has addressed these issues and before the EPA has revised its regulations at 40 CFR 51.166 and 52.21. However, the EPA is evaluating PSD program submissions to assure that state programs correctly address GHGs, consistent with the Supreme Court's decision. Because ADEC has excluded from its SIP submission the GHG Tailoring Rule provision that was vacated by the Supreme Court, that provision is not before the EPA for action.

    For the reasons discussed above, we are proposing to determine that the updated incorporation by reference of Federal requirements in 18 AAC 50.040(h) is consistent with CAA requirements for SIP-approved PSD permitting programs.

    We note that in both the July 1, 2014, and October 24, 2014, submittals, ADEC included changes to 18 AAC 50.040(i) related to Alaska's nonattainment new source review permitting program. These changes were previously approved on January 7, 2015 (80 FR 832).

    C. 18 AAC 50.225—Owner-Requested Limits

    The July 1, 2014, submittal included a revised version of 18 AAC 50.225 “Owner-Requested Limits,” effective October 6, 2013, that removed paragraph (b)(7). Paragraph (a) of 18 AAC 50.225 specifies that an owner-requested limit under this provision may be requested “to avoid all permitting obligations under AS 46.14.130 [Stationary sources requiring permits].” Paragraph (b)(7) of 18 AAC 50.225 stated that, “if applying all limits does not avoid all permit classifications under AS 46.14 and this chapter, the owner or operator shall submit to the department “a description, and if necessary an application, for the remaining classifications[.]” In the July 1, 2014, submittal, ADEC stated that in 18 AAC 50.225, paragraph (b)(7) contradicts paragraph (a) and that the repeal of (b)(7) merely clarifies the requirements for obtaining owner-requested limits. As explained by ADEC, the State's interpretation of 18 AAC 50.225 is that a source is only eligible to apply for an owner-requested limit under 18 AAC 50.225 to avoid all stationary source permitting obligations under AS 46.14.130. AS 46.14.130 “Stationary sources requiring permits” is the Alaska statute requiring both title I major new source construction permits and title V major source operating permits.2 If all obligations for major new source construction permitting cannot be avoided by requesting an emission limit on the source, then the owner or operator may not apply for an owner requested limit (ORL) under 18 AAC 50.225, but could instead request an ORL in a permit issued under 18 AAC 508 “Minor Permits Requested by the Owner or Operator.” This provision allows an owner or operator to request a minor permit from the department for “establishing an owner requested limit (ORL) to avoid one or more permit classifications under AS 46.14.130 at a stationary source that will remain subject to at least one permit classification. . .”

    2 Because the SIP addresses section 110 in title I of the CAA, the permitting obligation an owner or operator may seek to avoid through the SIP-approved rule at 18 AAC 50.225 is the obligation to obtain a major new source construction permit.

    In the July 1, 2014, submittal ADEC asserted that “there is no relaxation of the regulations, as the two types of ORLs allow the applicant to avoid permitting classifications depending on their particular situation.”

    We agree with ADEC that the provision at 18 AAC 50.225(b)(7) is potentially confusing and contradictory and that the repeal of that provision clarifies when each of the two provisions authorizing owner-requested limits (18 AAC 50.225 and 18 AAC 50.508) are applicable to owners and operators of stationary sources seeking an emission limit to avoid major permitting obligations. We therefore propose to approve the revision to 18 AAC 50.225.

    D. 18 AAC 50.260—Guidelines for Best Available Retrofit Technology Under the Regional Haze Rule

    In the July 1, 2014, submittal, ADEC revised this provision to reference the definition of fugitive emissions in 18 AAC 50.990 “Definitions” rather than the statutory definition in AS 46.14.990. The definition of “fugitive emissions” at 18 AAC 50.990(40) states that the term has the meaning given in 40 CFR 51.166(b)(20) in the Federal PSD regulations. This definition is approvable because the PSD definition of “fugitive emissions” in 40 CFR 51.166(b)(20) is identical to the definition of the same term in 40 CFR 51.301 “Definitions” for purposes of 40 CFR part 51, subpart P “Protection of Visibility.”

    E. 18 AAC 50.502—Minor Permits for Air Quality Protection

    The October 24, 2014, submittal revised 18 AAC 50.502 “Minor Permits for Air Quality Protection” to add paragraph (h)(5). This paragraph defines “regulated NSR pollutant” for new sources seeking minor permits under 18 AAC 50.502 by adopting by reference the Federal definition of “regulated NSR pollutant” at 40 CFR 52.21(b)(50). This is not a substantive change to Alaska's minor NSR program because this definition was previously included in 18 AAC 50.900.

    F. 18 AAC 50.990—Definitions

    The July 1, 2014, submittal revised the definition of “fugitive emissions” at 18 AAC 50.990(40) to have the meaning given in 40 CFR 51.166(b)(20), as revised as of July 1, 2012. The October 24, 2014, submittal repealed the definition of “regulated NSR pollutant” at 18 AAC 50.990(92). This action does not address these changes because we previously approved them on January 7, 2015 (80 FR 832).

    The July 1, 2014, submittal also updated the citation date for the incorporation by reference of the Federal definition of “volatile organic compound” (VOC). The submittal revised 18 AAC 50.990(121) to define “VOC” as the meaning given in 40 CFR 51,100(s) as of April 18, 2013. We note that the Federal definition has been revised since April 18, 2013. Specifically, on October 22, 2013, the EPA removed constituents from the definition of VOC (78 FR 62451). While the definition in Alaska's rule is not identical to the Federal definition, the Alaska definition is more stringent and therefore approvable.

    III. Proposed Action

    The EPA is proposing to approve and incorporate by reference into the Alaska SIP changes to the following provisions submitted on July 1, 2014 and October 24, 2014:

    • 18 AAC 50.015 “Air Quality Designations, Classifications, and Control Regions” (State effective 10/6/2013);

    • 18 AAC 50.040 “Federal Standards Adopted by Reference” (State effective 10/6/2013);

    • 18 AAC 50.225 “Owner-Requested Limits” (State effective 10/6/2013);

    • 18 AAC 50.260 “Guidelines for Best Available Retrofit Technology under the Regional Haze Rule” (State effective 10/6/2013);

    • 18 AAC 50.502 “Minor Permits for Air Quality Protection” (State effective 11/9/2014); and

    • 18 AAC 50.990 “Definitions” (State effective 11/9/2014).

    We have made the preliminary determination that the submitted SIP revisions are approvable because they are consistent with section 110 and part C of title I of the CAA. We note that this action does not address the submitted revisions related to Alaska's nonattainment NSR permitting program because we approved those changes on January 7, 2015 (80 FR 832).

    IV. Incorporation by Reference

    In this rule, the EPA is proposing to include in a final rule regulatory text that includes incorporation by reference. In accordance with requirements of 1 CFR 51.5, the EPA is proposing to incorporate by reference the provisions described above in Section III. Proposed Action. The EPA has made, and will continue to make, these documents generally available electronically through www.regulations.gov and/or in hard copy at the appropriate EPA office (see the ADDRESSES section of this preamble for more information).

    V. Statutory and Executive Order Reviews

    Under the CAA, the Administrator is required to approve a SIP submission that complies with the provisions of the CAA and applicable Federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in reviewing SIP submissions, the EPA's role is to approve state choices, provided that they meet the criteria of the CAA. Accordingly, this proposed action merely approves state law as meeting Federal requirements and does not impose additional requirements beyond those imposed by state law. For that reason, this proposed action:

    • Is not a “significant regulatory action” subject to review by the Office of Management and Budget under Executive Orders 12866 (58 FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 2011);

    • does not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);

    • is certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.);

    • does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4);

    • does not have Federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999);

    • is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997);

    • is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);

    • is not subject to requirements of Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) because it does not involve technical standards; and

    • does not provide the EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).

    In addition, the SIP is not approved to apply on any Indian reservation land or in any other area where the EPA or an Indian tribe has demonstrated that a tribe has jurisdiction. In those areas of Indian country, the rule does not have tribal implications as specified by Executive Order 13175 (65 FR 67249, November 9, 2000), nor will it impose substantial direct costs on tribal governments or preempt tribal law.

    List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Incorporation by reference, Intergovernmental relations, Particulate matter, Reporting and recordkeeping requirements.

    Authority:

    42 U.S.C. 7401 et seq.

    Dated: March 6, 2015. Dennis J. McLerran, Regional Administrator, Region 10.
    [FR Doc. 2015-06216 Filed 3-17-15; 8:45 am] BILLING CODE 6560-50-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 52 [EPA-R03-OAR-2014-0884; FRL-9924-55-Region 3] Approval and Promulgation of Air Quality Implementation Plans; Maryland; Determination of Attainment of the 2008 8-Hour Ozone National Ambient Air Quality Standard for the Baltimore, Maryland Moderate Nonattainment Area AGENCY:

    Environmental Protection Agency (EPA).

    ACTION:

    Proposed rule.

    SUMMARY:

    The Environmental Protection Agency (EPA) is proposing to make a determination that the Baltimore, Maryland Moderate Nonattainment Area (Baltimore Area) has attained the 2008 8-hour ozone National Ambient Air Quality Standard (NAAQS). This proposed determination is based upon complete, quality-assured, and certified ambient air monitoring data that shows the Area has monitored attainment of the 2008 8-hour ozone NAAQS for the 2012-2014 monitoring period. If this proposal becomes final, the requirement for this Area to submit an attainment demonstration, reasonably available control measures (RACM), a reasonable further progress (RFP) plan, and contingency measures related to attainment of the 2008 8-hour ozone NAAQS shall be suspended for so long as the Area continues to attain the 2008 8-hour ozone NAAQS. This action does not constitute a redesignation to attainment. The Baltimore Area will remain nonattainment for the 2008 8-hour ozone NAAQS until such time as EPA determines that the Baltimore Area meets the Clean Air Act (CAA) requirements for redesignation to attainment, including an approved maintenance plan. This action is being taken under the CAA.

    DATES:

    Written comments must be received on or before April 17, 2015.

    ADDRESSES:

    Submit your comments, identified by Docket ID Number EPA-R03-OAR-2014-0884 by one of the following methods:

    A. www.regulations.gov. Follow the on-line instructions for submitting comments.

    B. Email: [email protected]

    C. Mail: EPA-R03-OAR-2014-0884, Cristina Fernandez, Associate Director, Office of Air Program Planning, Mailcode 3AP30, U.S. Environmental Protection Agency, Region III, 1650 Arch Street, Philadelphia, Pennsylvania 19103.

    D. Hand Delivery: At the previously-listed EPA Region III address. Such deliveries are only accepted during the Docket's normal hours of operation, and special arrangements should be made for deliveries of boxed information.

    Instructions: Direct your comments to Docket ID No. EPA-R03-OAR-2014-0884. EPA's policy is that all comments received will be included in the public docket without change, and may be made available online at www.regulations.gov, including any personal information provided, unless the comment includes information claimed to be Confidential Business Information (CBI) or other information whose disclosure is restricted by statute. Do not submit information that you consider to be CBI or otherwise protected through www.regulations.gov or email. The www.regulations.gov Web site is an “anonymous access” system, which means EPA will not know your identity or contact information unless you provide it in the body of your comment. If you send an email comment directly to EPA without going through www.regulations.gov, your email address will be automatically captured and included as part of the comment that is placed in the public docket and made available on the Internet. If you submit an electronic comment, EPA recommends that you include your name and other contact information in the body of your comment and with any disk or CD-ROM you submit. If EPA cannot read your comment due to technical difficulties and cannot contact you for clarification, EPA may not be able to consider your comment. Electronic files should avoid the use of special characters, any form of encryption, and be free of any defects or viruses.

    Docket: All documents in the electronic docket are listed in the www.regulations.gov index. Although listed in the index, some information is not publicly available, i.e., CBI or other information whose disclosure is restricted by statute. Certain other material, such as copyrighted material, is not placed on the Internet and will be publicly available only in hard copy form. Publicly available docket materials are available either electronically in www.regulations.gov or in hard copy during normal business hours at the Air Protection Division, U.S. Environmental Protection Agency, Region III, 1650 Arch Street, Philadelphia, Pennsylvania 19103.

    FOR FURTHER INFORMATION CONTACT:

    Irene Shandruk, (215) 814-2166, or by email at [email protected]

    SUPPLEMENTARY INFORMATION: I. Background

    On March 12, 2008, EPA revised both the primary and secondary NAAQS for ozone to a level of 0.075 parts per million (ppm) (annual fourth-highest daily maximum 8-hour average concentration, averaged over three years) to provide increased protection of public health and the environment. 73 FR 16436 (March 27, 2008).1 The 2008 ozone NAAQS retains the same general form and averaging time as the 0.08 ppm NAAQS set in 1997, but is set at a more protective level. On May 21, 2012 (77 FR 30088), effective July 20, 2012, EPA designated as nonattainment any area that was violating the 2008 8-hour ozone NAAQS based on the three most recent years (2008-2010) of air monitoring data. The Baltimore Area (specifically, Anne Arundel County, Baltimore City, Baltimore County, Carroll County, Harford County, and Howard County) was designated as a moderate ozone nonattainment area. See 40 CFR 81.321. Moderate areas are required to attain the 2008 8-hour ozone NAAQS by no later than six years after the effective date of designations, or July 20, 2018. See 40 CFR 51.903. Air quality monitoring data from the 2012-2014 monitoring period indicate that the Baltimore Area is now attaining the 2008 8-hour ozone NAAQS.

    1 For a detailed explanation of the calculation of the 3-year 8-hour average, see 40 CFR part 50, appendix I.

    Under the provisions of EPA's ozone implementation rule (40 CFR 51.918), if EPA issues a determination that an area is attaining the relevant standard (through a rulemaking that includes public notice and comment), it will suspend the area's obligations to submit an attainment demonstration, RACM, RFP, contingency measures and other planning requirements related to attainment of the 2008 8-hour ozone NAAQS for as long as the area continues to attain the standard. This suspension remains in effect until such time, if ever, that EPA (i) redesignates the area to attainment at which time those requirements no longer apply, or (ii) subsequently determines that the area has violated the 2008 8-hour ozone NAAQS. Although these requirements are suspended, EPA is not precluded from acting upon these elements at any time if submitted to EPA for review and approval. The determination of attainment is not equivalent to a redesignation under section 107(d)(3) of the CAA. The designation status of the Baltimore Area will remain nonattainment for the 2008 8-hour ozone NAAQS until such time as EPA determines that the Area meets the CAA requirements for redesignation to attainment, including an approved maintenance plan. Additionally, the determination of attainment is separate from, and does not influence or otherwise affect, any future designation determination or requirements for the Baltimore Area based on any new or revised ozone NAAQS, and it remains in effect regardless of whether EPA designates this Area as a nonattainment area for purposes of any new or revised ozone NAAQS.

    II. EPA's Evaluation

    For ozone, an area may be considered to be attaining the 2008 8-hour ozone NAAQS if there are no violations, as determined in accordance with 40 CFR part 50, based on three complete, consecutive calendar years of quality-assured ambient air monitoring data. Under EPA regulations at 40 CFR part 50, the 2008 8-hour ozone NAAQS is attained when the 3-year average of the annual fourth-highest daily maximum 8-hour average ozone concentrations at an ozone monitor is less than or equal to 0.075 ppm. See 40 CFR part 50, appendix P. This 3-year average is referred to as the design value. When the design value is less than or equal to 0.075 ppm at each monitor within the area, then the area is attaining the NAAQS. Also, the data completeness requirement is met when the average percent of days with valid ambient monitoring data is greater than or equal to 90 percent (%), and no single year has less than 75% data completeness as determined in appendix P of 40 CFR part 50. The data must be collected and quality-assured in accordance with 40 CFR part 58, and recorded in the EPA Air Quality System (AQS).

    EPA has reviewed the complete, quality-assured and certified ozone ambient air monitoring data for the monitoring period for 2012-2014 for the Baltimore Area. The design values for each monitor for the years 2012-2014 are less than or equal to 0.075 ppm, and all monitors meet the data completeness requirements (see Table 1). Based on this 2012-2014 data from the AQS database and consistent with the requirements contained in 40 CFR part 50, EPA has concluded that this Area attained the 2008 8-hour ozone NAAQS.

    Table 1—2012-2014 Baltimore Area 2008 8-Hour Ozone Design Values Monitor ID Average
  • percent data
  • completeness
  • 2012-2014
  • Design value
  • (ppm)
  • 24-003-0014 97 0.074 24-005-1007 95 0.072 24-005-3001 99 0.072 24-013-0001 99 0.069 24-025-1001 98 0.075 24-025-9001 96 0.073 24-510-0054 90 0.064

    The data in Table 1 are available in EPA's AQS database. The AQS report with this data is available in the docket for this rulemaking under docket number EPA-R03-OAR-2014-0884 and available online at www.regulations.gov, docket number EPA-R03-OAR-2014-0884.

    III. Proposed Action

    EPA is proposing to make a determination that the Baltimore Area has attained the 2008 8-hour ozone NAAQS. This proposed determination is based upon complete, quality-assured, and certified ambient air monitoring data that show the Baltimore Area has monitored attainment of the 2008 8-hour ozone NAAQS for the 2012-2014 monitoring period. Once this proposal is final, the requirement for this Area to submit an attainment demonstration, RACM, a RFP plan, contingency measures, and other planning requirements related to attainment of the 2008 8-hour ozone NAAQS shall be suspended for so long as the Baltimore Area continues to attain the 2008 8-hour ozone NAAQS. Although these requirements are suspended, EPA is not precluded from acting upon these elements at any time if submitted to EPA for review and approval. Finalizing this determination does not constitute a redesignation of the Baltimore Area to attainment for the 2008 8-hour ozone NAAQS under CAA section 107(d)(3). This determination of attainment also does not involve approving any maintenance plan for the Baltimore Area and does not determine that the Baltimore Area has met all the requirements for redesignation under the CAA, including that the attainment be due to permanent and enforceable measures. Therefore, the designation status of the Baltimore Area will remain nonattainment for the 2008 8-hour ozone NAAQS until such time as EPA takes final rulemaking action to determine that such Area meets the CAA requirements for redesignation to attainment. EPA is soliciting public comments on the issues discussed in this document. These comments will be considered before taking final action.

    IV. Statutory and Executive Order Reviews

    This action proposes to make an attainment determination based on air quality data and would, if finalized, result in the suspension of certain Federal requirements and would not impose any additional requirements. For that reason, this proposed action:

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

    • Does not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);

    • Is certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.);

    • Does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4);

    • Does not have Federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999);

    • Is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997);

    • Is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);

    • Is not subject to requirements of Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) because application of those requirements would be inconsistent with the CAA; and

    • Does not provide EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).

    In addition, this proposed rule, concerning a determination of attainment for the 2008 ozone NAAQS for the Baltimore Area, does not have tribal implications as specified by Executive Order 13175 (65 FR 67249, November 9, 2000), because the State Implementation Plan (SIP) is not approved to apply in Indian country located in the state, and EPA notes that it will not impose substantial direct costs on tribal governments or preempt tribal law.

    List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Intergovernmental relations, Incorporation by reference, Ozone, Reporting and recordkeeping requirements.

    Authority:

    42 U.S.C. 7401 et seq.

    Dated: March 6, 2015. William C. Early, Acting Regional Administrator, Region III.
    [FR Doc. 2015-06220 Filed 3-17-15; 8:45 am] BILLING CODE 6560-50-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR part 52 [EPA-R09-OAR-2015-0187; FRL-9924-48-Region 9] Revisions to Air Plan; Arizona; Stationary Sources; New Source Review AGENCY:

    Environmental Protection Agency (EPA).

    ACTION:

    Proposed rule.

    SUMMARY:

    The Environmental Protection Agency (EPA) is proposing a limited approval and limited disapproval of revisions to the Arizona Department of Environmental Quality (ADEQ) portion of the applicable state implementation plan (SIP) for the State of Arizona. These revisions are primarily intended to serve as a replacement of ADEQ's existing SIP-approved rules for the issuance of New Source Review (NSR) permits for stationary sources, including but not limited to review and permitting of major sources and major modifications under the Clean Air Act (CAA or Act). After a lengthy stakeholder process, the State of Arizona developed and submitted a NSR program for SIP approval that satisfies most of the applicable Clean Air Act and NSR regulatory requirements, and will significantly update ADEQ's existing SIP-approved NSR program. It also represents an overall strengthening of ADEQ's SIP-approved NSR program by clarifying and enhancing the NSR permitting requirements for major and minor stationary sources. This proposed action will update the applicable plan and set the stage for remedying certain deficiencies in these rules. We are seeking comment on our proposed action and plan to follow with a final action.

    DATES:

    Any comments must arrive by April 17, 2015.

    ADDRESSES:

    Submit comments, identified by docket number EPA-R09-OAR-2015-0187, by one of the following methods:

    1. Federal eRulemaking Portal: www.regulations.gov. Follow the online instructions.

    2. Email: [email protected]

    3. Mail or deliver: Gerardo Rios (Air-3), U.S. Environmental Protection Agency, Region 9, 75 Hawthorne Street, San Francisco, CA 94105-3901. Deliveries are only accepted during the Regional Office's normal hours of operation.

    Instructions: All comments will be included in the public docket without change and may be made available online at www.regulations.gov, including any personal information provided, unless the comment includes Confidential Business Information (CBI) or other information whose disclosure is restricted by statute. Information that you consider CBI or otherwise protected should be clearly identified as such and should not be submitted through www.regulations.gov or email. www.regulations.gov is an “anonymous access” system, and EPA will not know your identity or contact information unless you provide it in the body of your comment. If you send email directly to EPA, your email address will be automatically captured and included as part of the public comment. If EPA cannot read your comment due to technical difficulties and cannot contact you for clarification, EPA may not be able to consider your comment. Electronic files should avoid the use of special characters, any form of encryption, and be free of any defects or viruses.

    Docket: Generally, documents in the docket for this action are available electronically at www.regulations.gov and in hard copy at EPA Region 9, 75 Hawthorne Street, San Francisco, California. While all documents in the docket are listed at www.regulations.gov, some information may be publicly available only at the hard copy location (e.g., copyrighted material, large maps), and some may not be publicly available in either location (e.g., CBI). To inspect the hard copy materials, please schedule an appointment during normal business hours with the contact listed in the FOR FURTHER INFORMATION CONTACT section.

    FOR FURTHER INFORMATION CONTACT:

    Lisa Beckham, EPA Region 9, (415) 972-3811, [email protected]

    SUPPLEMENTARY INFORMATION:

    Throughout this document, the terms “we,” “us,” and “our” refer to EPA.

    Table of Contents I. The State's Submittals A. Which rules or statutory provisions did the State submit? B. Are there previous versions of the statutory provisions or rules in the Arizona SIP? C. What is the purpose of this proposed rule? II. EPA's Evaluation A. How is EPA evaluating the rules and statutory provisions? B. Do the rules meet the evaluation criteria for Minor New Source Review? 1. Legally Enforceable Procedures 2. ADEQ's Program Under 40 CFR 51.160(e) 3. Public Availability of Information 4. Administrative Procedures 5. Stack Height Procedures C. Do the rules meet the evaluation criteria for Prevention of Significant Deterioration (PSD)? 1. General PSD Program Requirements 2. Restrictions on Area Classifications 3. Redesignations 4. Impacts on Class I Areas 5. Public Participation 6. Plantwide Applicability Limits 7. Definitions 8. PM2.5 Significant Monitoring Concentration 9. Definition for Basic Design Parameter D. Do the rules meet the evaluation criteria for Nonattainment New Source Review? 1. General Nonattainment NSR Program Requirements 2. Plantwide Applicability Limits 3. Definitions 4. Definition for Basic Design Parameter 5. Additional Provisions for Particulate Matter Nonattainment Areas E. Review of Non-NSR Related Rules and Statutory Provisions F. Review of Rules and Statutory Provisions Requested To Be Removed From the SIP G. Do the rules meet the evaluation criteria under Sections 110(l) and 193 of the Act? H. Conclusion III. Public Comment and Proposed Action IV. Incorporation by Reference V. Statutory and Executive Order Reviews Definitions

    For the purpose of this document, we are giving meaning to certain words or initials as follows:

    (i) The words or initials Act or CAA mean or refer to the Clean Air Act, unless the context indicates otherwise.

    (ii) The initials ADEQ mean or refer to the Arizona Department of Environmental Quality.

    (iii) The initials A.R.S. mean or refer to the Arizona Revised Statutes.

    (iv) The initials BACT mean or refer to Best Available Control Technology.

    (v) The initials CFR mean or refer to Code of Federal Regulations.

    (vi) The initials CO means or refer to carbon monoxide.

    (vii) The words EPA, we, us or our mean or refer to the United States Environmental Protection Agency.

    (viii) The initials FIP mean or refer to Federal Implementation Plan.

    (ix) The initials GHG mean or refer to greenhouse gas.

    (x) The initials IBR mean or refer to incorporation by reference.

    (xi) The initials LAER mean or refer to Lowest Achievable Emissions Rate.

    (xii) The initials NAAQS mean or refer to National Ambient Air Quality Standards.

    (xiii) The initials NA-NSR mean or refer to Nonattainment New Source Review.

    (xiv) The initials NO X mean or refer to nitrogen oxides.

    (xv) The initials NSR mean or refer to New Source Review.

    (xvi) The initials PAL mean or refer to Plantwide Applicability Limits.

    (xvii) The initials PM 10 mean or refer to particulate matter with an aerodynamic diameter of less than or equal to 10 micrometers (coarse particulate matter).

    (xviii) The initials PM 2.5 mean or refer to particulate matter with an aerodynamic diameter of less than or equal to 2.5 micrometers (fine particulate matter).

    (xix) The initials PSD mean or refer to Prevention of Significant Deterioration.

    (xx) The initials PTE mean or refer to potential to emit.

    (xxi) The initials RACT mean or refer to reasonable available control technology.

    (xxii) The initials SIP mean or refer to State Implementation Plan.

    (xxiii) The initials SMC mean or refer to significant monitoring concentration.

    (xxiv) The initials SO 2 mean or refer to sulfur dioxide.

    (xxv) The words State or Arizona mean the State of Arizona, unless the context indicates otherwise.

    (xxvi) The initials TSD mean or refer to the technical support document for this action.

    (xxvii) The initials VOC mean or refer to volatile organic compound.

    I. The State's Submittals A. Which rules or statutory provisions did the State submit?

    On July 28, 2011 and October 29, 2012, ADEQ submitted revisions to the ADEQ portion of the Arizona SIP. On May 16, 2014, ADEQ supplemented the July 28, 2011 submittal. On September 6, 2013, July 2, 2014, and February 16, 2015, ADEQ supplemented the October 29, 2012 submittal. Collectively, these submittals generally comprise ADEQ's current program for preconstruction review and permitting of new or modified stationary sources under ADEQ's jurisdiction in Arizona (as described below).1 The NSR SIP revisions that are the subject of this action, 2 referred to herein as the “NSR SIP submittal” represent a comprehensive revision to ADEQ's preconstruction review and permitting program and are intended to satisfy the requirements under both part C (prevention of significant deterioration) (PSD) and part D (nonattainment new source review) of title I of the Act as well as the general preconstruction review requirements under section 110(a)(2)(C) of the Act.3 The preconstruction review and permitting programs are often collectively referred to as “New Source Review” (NSR).

    1 In addition, these submittals and our current action also address two rules and one statutory provision that are not directly related to NSR.

    2 We note that portions of ADEQ's SIP-approved rule R18-2-310, which provides affirmative defenses for excess emissions during malfunctions (R18-2-310(B)) and for excess emissions during startup or shutdown (R18-2-310(C)), are currently the subject of a separate rulemaking action by EPA. In a 2013 notice of proposed rulemaking, and a 2014 supplemental notice of proposed rulemaking that revised certain of the findings described in the 2013 notice, EPA proposed to find R18-2-310(B) and R18-2-310(C) substantially inadequate to meet CAA requirements and proposed to issue a SIP call with respect to these provisions. See 78 FR 12460, 12533-34, Feb. 22, 2013; 79 FR 55920, 55946-47, Sept. 17, 2014. ADEQ's R18-2-310 is not part of the ADEQ SIP submittal that is under consideration in this action, and this rule is not being evaluated or otherwise addressed by EPA as part of our current action on ADEQ's SIP submittal.

    3 Rules R18-2-301 through R18-2-334 (Article 3 rules) also contain requirements to address the CAA title V requirements for operating permit programs, but we are not evaluating these rules for title V purposes at this time. We will evaluate the Article 3 rules for compliance with the requirements of title V of the Act and EPA's implementing regulations in 40 CFR part 70 following receipt of an official part 70 program revision submittal from ADEQ.

    The proposed revisions to the SIP that are subject to this action cover those areas of Arizona where ADEQ has jurisdiction. Currently, ADEQ has permitting jurisdiction for the following stationary source categories in all areas of Arizona: Smelting of metal ores, coal-fired electric generating stations, petroleum refineries, Portland cement plants, and portable sources. ADEQ also has permitting jurisdiction for major and minor sources in the following counties: Apache, Cochise, Coconino, Gila, Graham, Greenlee, La Paz, Mohave, Navajo, Santa Cruz, Yavapai, and Yuma. Finally, ADEQ has permitting jurisdiction over major sources in Pinal County 4 and the Rosemont Copper Mine in Pima County.

    4 ADEQ has delegated implementation of the major source program to the Pinal County Air Quality Control District.

    Table 1 lists the rules we are proposing for approval in today's action with the corresponding effective dates and submittal dates. The submitted rules are from the Arizona Administrative Code, Title 18—Environmental Quality, Chapter 2—Department of Environmental Quality—Air Pollution Control, Articles 1, 2, 3, and 4. The submitted statutory provision is from Title 49 of the Arizona Revised Statutes, Chapter 1, Article 1.

    Table 1—Submitted Statutes and Rules Proposed for Approval in This Action Rule or statute Title State
  • effective
  • date
  • Submitted
    A.R.S § 49-107 Local delegation of state authority 08/18/1987 07/2/2014 R18-2-101 [only definitions (2), (32), (87), (109), and (122)] Definitions 08/07/2012 10/29/2014 R18-2-217 Designation and Classification of Attainment Areas 11/15/1993 10/29/2014 R18-2-218 Limitation of Pollutants in Classified Attainment Areas 08/07/2012 10/29/2014 R18-2-301 Definitions 08/07/2012 10/29/2014 R18-2-302 Applicability; Registration; Classes of Permits 08/07/2012 10/29/2014 R18-2-302.01 Source Registration Requirements 08/07/2012 10/29/2014 R18-2-303 Transition from Installation and Operating Permit Program to Unitary Permit Program; Registration transition; Minor NSR transition 08/07/2012 10/29/2014 R18-2-304 Permit Application Processing Procedures 08/07/2012 10/29/2014 R18-2-306 Permit Contents 12/20/1999 10/29/2014 R18-2-306.01 Permits Containing Voluntarily Accepted Emission Limitations and Standards 01/01/2007 10/29/2014 R18-2-306.02 Establishment of an Emissions Cap 09/22/1999 10/29/2014 R18-2-311 Test Methods and Procedures 11/15/1993 07/28/2011 R18-2-312 Performance Tests 11/15/1993 07/28/2011 R18-2-315 Posting of Permit 11/15/1993 10/29/2014 R18-2-316 Notice by Building Permit Agencies 05/14/1979 10/29/2014 R18-2-319 Minor Permit Revisions 08/07/2012 10/29/2014 R18-2-320 Significant Permit Revisions 08/07/2012 10/29/2014 R18-2-321 Permit Reopenings; Revocation and Reissuance 08/07/2012 10/29/2014 R18-2-323 Permit Transfers 02/03/2007 10/29/2014 R18-2-330 Public Participation 08/07/2012 10/29/2014 R18-2-332 Stack Height Limitation 11/15/1993 10/29/2014 R18-2-334 Minor New Source Review 08/07/2012 10/29/2014 R18-2-401 [excluding definition (3)] Definitions 08/07/2012 10/29/2014 R18-2-402 General 08/07/2012 10/29/2014 R18-2-403 Permits for Sources Located in Nonattainment Areas 08/07/2012 10/29/2014 R18-2-404 Offset Standards 08/07/2012 10/29/2014 R18-2-405 Special Rule for Major Sources of VOC or Nitrogen Oxides in Ozone Nonattainment Areas Classified as Serious or Severe 08/07/2012 10/29/2014 R18-2-406 Permit Requirements for Sources Located in Attainment and Unclassifiable Areas 08/07/2012 10/29/2014 R18-2-407 [excluding subsection (H)(1)(c)] Air Quality Impact Analysis and Monitoring Requirements 08/07/2012 10/29/2014 R18-2-409 Air Quality Models 11/15/1993 10/29/2014 R18-2-412 PALs 08/07/2012 10/29/2014

    On December 28, 2012, April 29, 2013, and December 2, 2014, ADEQ's July 28, 2011, October 29, 2012, and July 2, 2014 submittals, respectively, were deemed complete by operation of law to meet the completeness criteria in 40 CFR part 51, appendix V, which must be met before formal EPA review. Each of these submittals includes evidence of public notice and adoption of the regulation. Our technical support document (TSD) provides additional background information on each of the submitted rules.

    B. Are there previous versions of the statutory provisions or rules in the Arizona SIP?

    EPA has not approved significant revisions or updates to ADEQ's SIP-approved NSR program since the 1980s. The existing SIP-approved NSR program for new or modified stationary sources under ADEQ's jurisdiction generally consists of the rules identified below in Table 2 that we are proposing to supersede in or delete from the Arizona SIP. Collectively, these regulations established the NSR requirements for both major and minor stationary sources under ADEQ jurisdiction in Arizona, including requirements for the generation and use of emission reduction credits in nonattainment areas.

    Consistent with ADEQ's stated intent to have the submitted NSR rules replace the existing NSR program in the SIP, EPA's approval of the regulations identified above in Table 1 generally would have the effect of superseding our prior approval of the current SIP-approved NSR program.5 Table 2 lists the existing rules in the Arizona SIP that would be superseded or removed from the Arizona SIP as a result of our proposed action. If EPA were to take final action as proposed herein, these rules generally would be replaced in, or otherwise deleted from, the SIP by the submitted set of rules listed in Table 1.

    5 Except for certain sections that ADEQ requested that we not remove from the SIP at this time.

    Table 2—SIP Rules Superseded or Removed From Arizona SIP in This Action Rule or statute Title EPA Approval date Federal
  • Register
  • citation
  • R9-3-101 Definitions Various Various R9-3-217(B) Attainment Areas: Classification and Standards 04/23/1982 47 FR 17486 R9-3-301, [excluding subsections (I), (K)] Installation Permits: General 05/03/1983 48 FR 198879 R9-3-302 Installation Permits in Nonattainment Areas 08/10/1988 53 FR 30220 R9-3-303 Offset Standards 08/10/1988 53 FR 30220 R9-3-304, [excluding subsection (H)] Installation Permits in Attainment Areas 05/03/1983 48 FR 19879 R9-3-305 Air Quality Analysis and Monitoring Requirements 05/03/1983 48 FR 19879 R9-3-306 Source Registration Requirements 05/03/1983 48 FR 19879 R9-3-307 Replacement 05/05/1982 47 FR 19328 R9-3-308 Permit Conditions 04/23/1982 47 FR 17485 R9-3-311 Air Quality Models 04/23/1982 47 FR 17485 R9-3-314 Excess Emissions Reporting 04/23/1982 47 FR 17485 R9-3-315 Posting of Permits 04/23/1982 47 FR 17485 R9-3-316 Notice by Building Permit Agencies 04/23/1982 47 FR 17485 R9-3-317 Permit Non-transferrable; Exception 04/23/1982 47 FR 17485 R9-3-318 Denial or Revocation of Installation or Operating Permit 04/23/1982 47 FR 17485 R8-3-319 Permit Fees 04/23/1982 47 FR 17485 R9-3-322 Temporary Conditional Permits 10/19/1984 49 FR 41026 R9-3-1101 Jurisdiction 05/03/1983 48 FR 19879 Appendix 4 Fee Schedule for Installation and Operating Permits 09/19/1977 42 FR 16926 Appendix 5 Fee Schedule for Conditional Permits 09/19/1977 42 FR 46926
    C. What is the purpose of this proposed rule?

    The purpose of this proposed rule is to present our evaluation under the CAA and EPA's regulations of rules and statutory provisions submitted by ADEQ on July 28, 2011, October 29, 2012, and July 2, 2014, which are identified in Table 1. We provide our reasoning in general terms below, and include our more detailed analysis in the TSD, which is available in the docket for this proposed rulemaking.

    II. EPA's Evaluation A. How is EPA evaluating the rules and statutory provisions?

    EPA has reviewed the provisions submitted by ADEQ that are the subject of this action, including those governing NSR for stationary sources under ADEQ jurisdiction for compliance with the CAA's general requirements for SIPs in CAA section 110(a)(2), EPA's regulations for stationary source permitting programs in 40 CFR part 51, sections 51.160 through 51.166, and the CAA requirements for SIP revisions in CAA section 110(l) and 193.6

    6 CAA section 110(l) requires SIP revisions to be subject to reasonable notice and public hearing prior to adoption and submittal by States to EPA and prohibits EPA from approving any SIP revision that would interfere with any applicable requirement concerning attainment and reasonable further progress, or any other applicable requirement of the CAA. CAA section 193, which was added by the CAA Amendments of 1990, includes a savings clause that provides, in pertinent part: “No control requirement in effect, or required to be adopted by an order, settlement agreement, or plan in effect before November 15, 1990, in any area which is a nonattainment area for any air pollutant may be modified after November 15, 1990, in any manner unless the modification insures equivalent or greater emission reductions of such air pollutant.”

    With respect to procedures, CAA sections 110(a) and 110(l) require that revisions to a SIP be adopted by the State after reasonable notice and public hearing. EPA has promulgated specific procedural requirements for SIP revisions in 40 CFR part 51, subpart F. These requirements include publication of notices, by prominent advertisement in the relevant geographic area, of a public hearing on the proposed revisions, a public comment period of at least 30 days, and an opportunity for a public hearing.

    Based on our review of the public process documentation included in the July 28, 2011, October 29, 2012 and July 2, 2014 submittals, we find that ADEQ has provided sufficient evidence of public notice and opportunity for comment and public hearings prior to adoption and submittal of these rules to EPA.

    With respect to substantive requirements, we have generally reviewed the ADEQ provisions that are the subject of our current action in accordance with the CAA and applicable regulatory requirements, focusing primarily on those that apply to: (1) General preconstruction review programs, including for minor sources, under section 110(a)(2)(C) of the Act; (2) PSD permit programs under part C of title I of the Act; and (3) Nonattainment NSR permit programs under part D of title I of the Act (NA-NSR). For the most part, ADEQ's submittal satisfies applicable CAA requirements, specifically including the applicable requirements for these three preconstruction review programs and would strengthen the applicable SIP by updating the regulations and adding requirements to address new or revised NSR permitting and other requirements promulgated by EPA, but the submitted rules also contain specific deficiencies that prevent full approval. Below, we discuss generally our evaluation of ADEQ's submittal and the deficiencies that are the basis for our proposed action on these rules. Our TSD contains a more detailed evaluation as well as additional recommendations for program improvements.

    B. Do the rules meet the evaluation criteria for Minor New Source Review?

    Section 110(a)(2)(C) requires each SIP to include a program for the regulation of the modification and construction of any stationary source within the areas covered by the plan as necessary to assure attainment and maintenance of the National Ambient Air Quality Standards (NAAQS). In addition to the permit programs required under parts C and D of the CAA for PSD sources and nonattainment NSR sources, respectively, which are discussed below, EPA's regulations at 40 CFR 51.160-51.164 provide general programmatic requirements to implement this statutory mandate commonly referred to as the “minor NSR program.” These minor NSR program regulations impose requirements for SIP approval of State and local programs that are more general in nature as compared with the specific statutory and regulatory requirements for PSD and NA-NSR permitting programs. Under EPA's regulations governing the minor NSR program, States and local air agencies retain a level of discretion to define the types and sizes of sources subject to the program, whereas under the PSD and nonattainment NSR permitting programs, the sources subject to regulation are specified by EPA regulations. The substantive requirements for the preconstruction review and permitting of minor stationary sources under ADEQ jurisdiction are ADEQ rules R18-2-302.01 and R18-2-334. These rules, and other administrative rules included in the minor NSR portion of the SIP submittal, satisfy most of the statutory and regulatory requirements for minor NSR programs, but these rules also contain several deficiencies that form the basis for our proposed limited disapproval, as discussed below.

    We are proposing a limited approval and limited disapproval of ADEQ's minor NSR program because it is not fully consistent with the requirements of 40 CFR 51.160, 40 CFR 51.161, 40 CFR 51.163 and 40 CFR 51.164, as described below. We find that approval of ADEQ's updated minor NSR program will substantially strengthen the SIP overall, as the submitted minor NSR program generally has more extensive requirements for minor sources and non-major modifications than ADEQ's current SIP-approved program and lower permitting thresholds that will provide additional mechanisms for protecting the NAAQS, as well as updating the SIP with current State regulations for minor sources and non-major modifications. However, specific provisions of the minor NSR program submittal are inconsistent with federal minor NSR program requirements, and these deficiencies must be addressed before we can fully approve ADEQ's minor NSR program into the SIP. The deficiencies that we have identified with ADEQ's minor NSR program that provide the basis for our limited approval and limited disapproval are described below.

    1. Legally Enforceable Procedures

    40 CFR 51.160 requires that each NSR program contain certain legally enforceable procedures. We have identified several deficiencies with ADEQ's program as it pertains to these requirements.

    First, as required by 40 CFR 51.160(a), ADEQ's permitting procedures are not enforceable in all instances. ADEQ's program allows certain sources to begin construction when a “proposed final permit” is issued by ADEQ, rather than preventing construction until a final permit has been issued. See R18-2-101(114), R18-2-302(G), R18-2-334(B), R18-2-402(C). The definition for “proposed final permit” in R18-2-101 does not specify that such an action is a final decision for NSR purposes. As a result, the program does not provide ADEQ with clear authority to prevent construction or modification before it issues a final decision on the request for authority to construct as is required per 40 CFR 51.160(a) and (b). ADEQ has clarified that, in effect, under ADEQ's rules, a proposed final permit is treated as a final authorization to construct, and that it will treat proposed final permit as a final, appealable agency action under Arizona law.7 Nevertheless, a revision to ADEQ's NSR program is necessary to ensure that these types of permit actions clearly serve as a final authority to construct in order to satisfy the federal NSR program requirement that the agency be able to prevent construction until and unless it has issued a final decision on the request for authority to construct.

    7 ADEQ Memo—Proposed Final Permits to be Treated as Appealable Agency Actions, dated February 10, 2015 and ADEQ's February 23, 20157 supplement at 2.

    Second, ADEQ's program does not contain adequate enforceable procedures to ensure compliance by sources subject to review under its NSR program with the NAAQS as required by 40 CFR 51.160(a)(2) and (b)(2). Although NAAQS is a defined term in ADEQ's regulations, see R18-2-101(85), ADEQ's NSR program generally does not refer to the NAAQS and instead generally references the State's ambient air standards in Article 2 of ADEQ's air program. See R18-2-302.01, R18-2-334, and R18-2-406.8 Also, in some instances, ADEQ's NSR regulations simply refer to Arizona ambient air quality standards with no specific reference to Article 2, which makes the applicable standards ambiguous.9 See R18-2-218, R18-2-406, and R18-2-407. In some instances, ADEQ's NSR program does not ensure that a source would not interfere with attainment or maintenance of the NAAQS in neighboring areas outside ADEQ's permitting jurisdiction, as is required under 40 CFR 51.160(a) and (b), as the State air standards are not generally applicable in neighboring States,10 and the NSR Program submittal does not demonstrate that they are applicable in neighboring States for purposes of ADEQ's NSR program. See R18-2-302.01(C); R18-2-334(C)(2), (F), and (G); and R18-2-406(A)(5)(a) and (b). Also, for minor sources subject to permitting under R18-2-334, the rule does not meet these federal requirements as it does not require ADEQ to evaluate whether the project under review will interfere with attainment or maintenance of the NAAQS in all cases, and instead allows sources to apply reasonably available control technology (RACT) in lieu of such an evaluation and, in some cases, appears to allow sources with lower levels of emissions to avoid both substantive NAAQS review and RACT requirements. See R18-2-334(C)(1)(a)-(b). ADEQ has not demonstrated that this approach ensures that all sources subject to review under its NSR program will not interfere with attainment or maintenance of the NAAQS. While R18-2-334(G) allows Director's discretion to require a NAAQS analysis on a case-by-case basis, we find this discretion too great to ensure compliance with this requirement. Finally, R18-2-302.01(C)(4) needs to include a reference to “or maintenance” of a standard, instead of just “attainment of a standard.”

    8 ADEQ's list of state air standards does not contain the current PM2.5 annual NAAQS of 12 μ g/m3 PM2.5. See 78 FR 3086, Jan. 13, 2013. This is not a disapproval issue for ADEQ's minor NSR and NA-NSR programs, which have three years to adopt programs implementing the new NAAQS. However, the new NAAQS is applied immediately upon its effective date to sources subject to the PSD program.

    9 For example, R18-2-407(B) contains “any such pollutant for which no Arizona ambient air quality standard exists.” “Arizona ambient air quality standard” is not a defined term in ADEQ's regulations.

    10 See, for example, the definition of “attainment area” in R18-2-101, limiting attainment areas to those in Arizona. A.R.S. § 49-106 provides, in relevant part: “The rules adopted by the department apply and shall be observed throughout this state, or as provided by their terms, and the appropriate local officer, council or board shall enforce them.”

    Third, for sources subject to ADEQ's registration program at R18-2-302.01, ADEQ has not demonstrated that its NSR program meets the requirement to ensure that sources subject to NSR review comply with the applicable portions of the control strategy as required by 40 CFR 51.160(b)(1).

    Fourth, ADEQ's registration program in R18-2-302.01 does not contain enforceable procedures for the owner or operator to submit the necessary information for ADEQ to determine whether a source will violate the applicable control strategy or interfere with attainment or maintenance of the NAAQS as required by 40 CFR 51.160(c). R18-2-302.01(A)(3) requires applicants to calculate a source's uncontrolled potential to emit, but then references provisions in another rule, R18-2-327(C), that are used to calculate “actual” emissions. As such, ADEQ's program contains conflicting procedures for calculating potential emissions. In addition, rule R18-2-327, is not in the Arizona SIP, and has not been submitted to EPA for SIP approval.

    Fifth, ADEQ's program does not meet the requirement that the applicant submit information related to the nature and amounts of emissions, for certain kinds of emissions units as required by 40 CFR 51.160(c)(1). For Class I and Class II permits, R18-2-304(E)(9) allows sources to avoid providing emission information for “insignificant activities,” as defined in R18-2-101(68). The term “insignificant activities” is generally associated with the title V program. Many of the activities listed in ADEQ's definition of insignificant activity are activities that would not be expected to emit regulated NSR pollutants. However, this is not true for all activities, such as those listed under R18-2-101(68)(a-c) that include liquid storage tanks, combustion engines, and “low-emitting processes.”

    Sixth, for sources subject to R18-2-302.01, ADEQ's program does not meet the requirement in 40 CFR 51.160(d) that its procedures provide that approval of construction or modification will not affect the responsibility of the owner or operator to comply with applicable portions of the control strategy.

    Finally, for sources subject to ADEQ's registration program under R18-2-302.01, ADEQ's program does not meet the requirement to use Appendix W to 40 CFR part 51 for air quality modeling as required by 40 CFR 51.160(f)(1).

    2. ADEQ's Program Under 40 CFR 51.160(e)

    40 CFR 51.160(e) requires ADEQ's submittal to provide a basis for the types and sizes of facilities, buildings, structures, or installations that will be subject to review under 40 CFR 51.160. Such exclusions are appropriate so long as such sources and modifications are not environmentally significant, consistent with the de minimis exemption criteria set forth in Ala. Power Co. v. Costle, 636 F.2d 323, at 360-361 (D.C. Cir. 1979). Here, we discuss our evaluation of the basis provided by ADEQ for the types and sizes of facilities, buildings, structures or installations it will subject to review under its minor NSR program. Historically, ADEQ's minor NSR program required permitting of minor sources and non-major modifications causing an increase in potential emissions of a criteria pollutant at or above the significant emission rates under the PSD program in 40 CFR 51.166(b)(23)(i). In a May 22, 1996 letter to ADEQ, EPA Region 9 indicated that the significant emission rates used by ADEQ for its minor NSR permitting program did not represent an acceptable threshold for applying the basic preconstruction requirements for minor NSR purposes. To address EPA's concerns, ADEQ assessed other potential permitting thresholds for its minor NSR program and selected revised thresholds for its minor NSR program following this assessment. A detailed analysis of ADEQ's assessment is provided in our TSD. ADEQ's new minor NSR program established a minimum preconstruction review threshold for new or modified stationary sources with potential emissions or emissions increases of: 50 tons per year (tpy) of carbon monoxide; 20 tpy of NOX, SO2, and VOC; 7.5 tpy for PM10; 5 tpy for PM2.5; and 0.3 tpy for lead. We find ADEQ's general approach to meeting 40 CFR 51.160(e) acceptable. We are proposing a limited disapproval of ADEQ's minor NSR program based in part on the following issues concerning the approach:

    First, ADEQ's submittal does not provide a clear basis for concluding that the exemption thresholds selected by ADEQ will ensure a sufficient percentage of minor sources are subject to review in nonattainment areas. As ADEQ points out in its submittal, ADEQ's analysis is based on data for Maricopa County 11 , which has lower NSR permitting thresholds than the exemption thresholds adopted by ADEQ due to Maricopa County's local air quality problems. In addition, (1) some of the other permitting programs in Table 3 above have lower permitting thresholds in nonattainment areas than those applicable in attainment areas under their jurisdiction; (2) in looking at a similar analysis of minor source emissions for another permitting program in Region 9, which has local air quality problems, the permitting agency generally set thresholds that include a larger percentage of emissions in the NSR program than the percentage included in ADEQ's program 12 ; and (3) typically, nonattainment areas have more control requirements that apply to smaller minor sources, as compared to attainment areas. As such, ADEQ's basis does not clearly address how its adopted preconstruction review exemption thresholds adequately address nonattainment areas.13

    11 ADEQ does not have jurisdiction for permitting of minor sources in Maricopa County, AZ.

    12 See EPA's Technical Support Document for Revision of Air Quality Implementation Plan; California; Sacramento Metropolitan Air Quality Management District; Stationary Source Permits, 78 FR10589, Feb. 2, 2014, at 6-7, describing the thresholds applicable in Sacramento as generally excluding less than 5% of the emissions inventory except for SO2.

    13 In addressing this deficiency, ADEQ does not necessarily have to consider lower permitting exemption thresholds in nonattainment areas. For example, ADEQ could provide further analysis to demonstrate that the adopted thresholds are appropriate for nonattainment areas or consider a different approach, such as requiring minor sources in nonattainment areas subject to a SIP requirement for the nonattainment pollutant, or its precursors, to obtain a registration, if ADEQ can demonstrate that such an approach would serve to satisfy the requirements of 40 CFR 51.160.

    Second, while EPA agrees that, in general, certain types of equipment may be exempted from the minor NSR program, ADEQ must provide a basis under 40 CFR 51.160(e) to demonstrate that regulation of the equipment exempted in R18-2-302(C) and A.R.S. § 49-426(B) is not needed for ADEQ's program to meet federal NSR requirements for attainment and maintenance of the NAAQS or review for compliance with the control strategy. Such demonstration must address: (1) An explanation of whether the regulatory exemption in R18-2-302(C) for “agricultural equipment used in normal farm operations” constitutes an interpretation or refinement of the exemption for such sources in A.R.S. § 49-426(B), and how the two provisions apply to ADEQ's NSR program; (2) Identification of the types of equipment ADEQ considers to be “agricultural equipment used in normal farm operations” and whether this type of equipment could potentially be expected to occur at a stationary source subject to title V of the Act, 40 CFR parts 60, 61, or 63, or major NSR, and, if so, whether such equipment is subject to NSR review at such sources; (3) ADEQ's basis for determining that “agricultural equipment used in normal farm operations” does not need to be regulated as part of ADEQ's minor NSR program under 40 CFR 51.160(e); and (4) ADEQ's interpretation of the exemption for fuel burning equipment in A.R.S. § 49-426(B) and how it does, or does not, apply in the context of its major and minor NSR programs, and, to the extent such equipment is not subject to NSR review, ADEQ's basis for determining that equipment exempted under this provision does not need to be reviewed as part of ADEQ's minor NSR program under 40 CFR 51.160(e).

    Finally, ADEQ's minor NSR program sets a permitting exemption threshold for PM2.5 of 5 tons per year, but ADEQ's analysis does not provide a basis for this threshold.

    3. Public Availability of Information

    40 CFR 51.161 requires that each NSR program contain certain procedures related to public participation. We have identified several deficiencies with ADEQ's program as it pertains to these requirements.

    First, ADEQ's program does not ensure that NSR review for all minor sources regulated under ADEQ's NSR program, as ADEQ defines it pursuant to 40 CFR 51.160(e), is subject to public notice and comment consistent with 40 CFR 51.161(a). 40 CFR 51.161(a) requires that the program under 51.160 provide for public comment on the information submitted by owners or operators. In addition, the public information must include ADEQ's analysis of the effects of construction or modification on ambient air, including ADEQ's proposed approval or disapproval. ADEQ's program does not meet this requirement because: (1) “modification” of existing sources that become subject to the registration program under R18-2-302.01 (currently only “construction” of a source) are not subject to public notice (see R18-2-302.01(B)(3)); (2) R18-2-334(G) exempts most modifications from public notice; (3) R18-2-330 does not clearly define which public notice requirements apply to registrations; and (4) public participation does not appear to be required for a proposed disapproval of an application for any portion of ADEQ's NSR program (registration, minor NSR, or major NSR).

    Second, ADEQ's registration program at R18-2-302.01(F) does not contain the necessary enforceable procedures for sources taking “elective limits” to limit their potential to emit in a manner that allows the source to avoid the public participation requirements in 40 CFR 51.161(a), while otherwise being subject to the registration program. See R18-2-302.01(B)(3)(b) and R18-2-302(E)(1). While ADEQ's rule contains requirements for monitoring, recordkeeping, and reporting of elective limits, these requirements are not sufficiently enforceable for purposes of limiting the source's potential to emit, and thereby avoiding public notice, as well other substantive requirements of ADEQ's minor NSR program when issuing a registration. In order to meet practical enforceability requirements for limiting the potential to emit (PTE), R18-2-302.01(F) must also contain (1) a technically accurate limitation and the portions of the source subject to the limitation and (2) the time period for the limitations (hourly, daily, monthly, etc.). Further, if the limitation is over a period longer than daily, R18-2-302.01(F) must specify when to compile daily records to show compliance with the elected limit. Additional detail on this issue is provided in our TSD.

    Third, ADEQ's NSR program does not ensure, for all sources subject to NSR review, the availability for public inspection, in at least one location in the area affected, of the information submitted by the owner or operator and of ADEQ's analysis on the effect on air quality as required by this federal regulation. R18-2-330(D)(11) requires the public notice to identify the nearest ADEQ office where documents can be inspected, but there are only two department offices for ADEQ. See 40 CFR 51.161(b)(1). We do not interpret this provision as meeting the requirement to make information available in the “area affected.” In addition, the public notice requirements do not make reference to providing ADEQ's analysis for public inspection. Potentially, this is covered by “all other materials available to the Director that are relevant to the permit decision”.14 But it is not clear that ADEQ would interpret this to mean the Director's own analysis.

    14 This requirement is met for ADEQ's registration program at R18-2-302.01(B)(3)(a).

    Finally, ADEQ's NSR program does provide notice to the necessary parties in 40 CFR 51.161(d) for sources required to obtain registrations under R18-2-302.01.

    4. Administrative Procedures

    40 CFR 51.163 requires each NSR program to include administrative procedures that will be followed in making the determinations specified in 40 CFR 51.160(a). While ADEQ's program generally meets the requirements of this provision, ADEQ's submittal contains references to other ADEQ rules, R18-2-317 and R18-2-317.02, which are not in the SIP and have not been submitted for SIP approval. See R18-2-306.02(D), R18-2-319(I), R18-2-304(J), R18-2-306(A), and R18-2-306.02(D).

    5. Stack Height Procedures

    40 CFR 51.164 requires that each NSR program contain certain provisions related to good engineering practice for stack heights. In addition to reviewing ADEQ's submittal as compared with the NSR program requirements of 40 CFR 51.164, we also reviewed ADEQ's submittal as it relates to certain general SIP program requirements in 40 CFR 51.100 and 51.118. The stack height provisions in the NSR program rely on the general stack height provisions in 40 CFR 51.118(b), which in turn references the definitions in 40 CFR 51.100(hh) through (kk). We have identified several deficiencies with ADEQ's program as it pertains to these requirements.

    First, ADEQ's submittal does not meet the public hearing requirements in 40 CFR 51.164 and 51.118(a). While R18-2-332(E) contains a reference to holding a public hearing, when required, the provision references ADEQ's public hearing provision in R18-1-402. R18-1-402 is not in the SIP and has not been submitted for SIP approval.

    Second, ADEQ's submittal does not contain language that meets the exception in 40 CFR 51.118(b): “except where pollutants are being emitted from such stacks or using such dispersion techniques by sources, as defined in section 111(a)(3) of the Clean Air Act, which were constructed, or reconstructed, or for which major modifications, as defined in §§ 51.165(a)(1)(v)(A), 51.166(b)(2)(i) and 52.21(b)(2)(i), were carried out after December 31, 1970.” In addition, R18-2-332(A)(3) incorrectly references July 1, 1975 instead of July 1, 1957 as that date appears in 40 CFR 51.118(b).

    Third, ADEQ's submittal does not contain a requirement that owners or operators seeking to rely on the equation in 40 CFR 51.100(ii)(2)(i) produce evidence that the equation was actually relied on in establishing an emission limitation. See R18-2-332(B)(2).

    Finally, ADEQ's submittal contains a provision at R18-2-332(D) that provides additional provisions for sources “seeking credit because of plume impaction which results in concentrations in violation of national ambient air quality standards or applicable maximum allowable increases.” This provision is not contained in the federal regulations and appears to allow for the use of stack heights beyond GEP stack height, as defined in 40 CFR 51.100(ii).

    In sum, while we have identified several disapproval issues with ADEQ's minor NSR program requirements as they correspond to federal minor NSR program requirements, compared to the existing SIP, approving ADEQ's minor NSR program into the Arizona SIP nonetheless represents a significant overall strengthening of ADEQ's NSR program, as discussed above. Thus, we are proposing a limited approval and limited approval of ADEQ's minor NSR program submittal.

    C. Do the rules meet the evaluation criteria for Prevention of Significant Deterioration (PSD)?

    Part C of title I of the Act contains the provisions for the prevention of significant deterioration (PSD) of air quality in areas designated “attainment” or “unclassifiable” for the NAAQS, including preconstruction permit requirements for new major sources or major modifications proposing to construct in such areas. EPA's regulations for SIP-approved PSD permit programs are found in 40 CFR 51.166.

    ADEQ rules R18-2-402 and R18-2-406 contain the substantive requirements for review and permitting of PSD sources under ADEQ's jurisdiction. These regulations satisfy most of the statutory and regulatory requirements for PSD permit programs, but these and other rules in the NSR SIP submittal contain several deficiencies that form the basis for our proposed limited disapproval, or proposed disapprovals as discussed below.

    Although ADEQ's submittal meets most PSD program requirements, we are proposing to disapprove two specific aspects of ADEQ's PSD program. The ADEQ rule provisions that we are proposing to disapprove are directly comparable to federal PSD rule provisions that have been vacated by federal courts, and we find that they are separable from the remainder of ADEQ's PSD program. Accordingly, we find these provisions suitable for disapproval at this time. These provisions are described below in Sections II.C.8 and 9.

    For the remainder of ADEQ's PSD program submittal, we are proposing limited approval and limited disapproval. We find that approval of ADEQ's updated PSD program, aside from the two aspects that are separable and will be disapproved as mentioned above, will substantially strengthen the SIP overall, particularly as the current SIP-approved PSD program is significantly out of date when compared with current federal PSD regulatory requirements as well as current State regulations. See our discussion in Section G below. However, specific provisions of the PSD SIP program submittal are inconsistent with PSD program requirements, and these deficiencies must be addressed before we can fully approve ADEQ's PSD program. The deficiencies that we have identified with ADEQ's PSD program that provide the basis for our limited disapproval are described below in Sections II.C.1 through 7.

    1. General PSD Program Requirements

    First, ADEQ's submittal often refers to Articles 9 and/or 11 of ADEQ's regulations where the federal regulations refer to 40 CFR parts 60, 61, or 63; or, similarly, sections 111 or 112 of the Act. See R18-2-101(53)(a), (122)(b); R18-2-401(10); R18-2-402(G)(2); and R18-2-406(A)(4). Articles 9 and 11 are where ADEQ incorporates by reference the federal regulations in 40 CFR part 60, 61, and 63 (which EPA implements under sections 111 and 112 of the Act). However, these Articles are not in the SIP, have not been submitted for SIP approval, and do not contain provisions equivalent to all of the subparts in parts 60, 61, and 63. See 40 CFR 51.166(b)(1)(iii)(aa), (b)(12), (b)(16)(i), (b)(17), (b)(47)(ii)(c), (b)(49)(ii), (i)(1)(ii)(aa), and (j).

    Second, ADEQ's submittal uses the term “increment” or “incremental ambient standard,” but does not specifically define these terms or otherwise identify what is meant by these terms. While the PSD program does not specifically define the term “increment” either, the term is introduced at 40 CFR 51.166(c)—Ambient air increments and other measures. (emphasis added) 40 CFR 51.166(c) then goes on to identify the specific increment values as “maximum allowable increases.” ADEQ appears to have taken the approach of using the term “maximum allowable increase” to refer to the increments, which is acceptable. ADEQ adopted the increments, or maximum allowable increases, in R18-2-218—Limitation of Pollutants in Classified Attainment Areas. However, in other rules ADEQ uses “increment” or “incremental ambient standard” where it appears the intent is to refer to the increments established in R18-2-218 and identified in ADEQ's rules as the “maximum allowable increases.” See R18-2-406(E), R18-2-412(G)(b), R18-2-101(51), R18-2-319, R18-2-320.

    Third, on January 15, 2013, EPA issued a final rule revising the NAAQS for PM2.5 for the annual averaging period, lowering the level of the NAAQS from 15.0 to 12.0 mg/m3, effective March 18, 2013 (see 78 FR 3086). This new NAAQS is required to be implemented for PSD sources (unless otherwise grandfathered under provisions at 40 CFR 51.166(i)(10)) beginning with the effective date of the NAAQS. However, ADEQ's PSD program does not provide for the review of new or modified sources for compliance with this new NAAQS as required in 40 CFR 51.166(b)(2)(iii)(i)(2), (b)(35), (d), (g)(3)(iii), (k), and (m)(1). Instead, ADEQ's PSD program currently references state ambient air quality standards, which are set at levels that are equivalent to all of the current NAAQS, except for this newly adopted PM2.5 NAAQS. See R18-2-218(F)(b)(ii), R18-2-401(25), R18-2-406(A) and R18-2-407(B). Because of the general approach used in ADEQ's NSR program with respect to incorporating the NAAQS, i.e., the program's reference to state air quality standards instead of the NAAQS, any changes EPA makes to the NAAQS will not be included in ADEQ's program until ADEQ revises its air quality standards rules to adopt the revised NAAQS as state air quality standards. This does not relieve any owner or operator from the requirement to comply with all NAAQS at the time a final PSD permit is issued, including the recently revised new PM2.5 NAAQS (unless otherwise grandfathered under 40 CFR 51.166). See CAA section 165(a)(3).

    Fourth, R18-2-406(A) contains a reference to R18-2-408, but R18-2-408 is not in the SIP and has not been submitted for SIP approval.

    Fifth, ADEQ's submittal allows a source at R18-2-302(G) and R18-2-402(C) to begin actual construction upon the issuance of a proposed final permit. As previously discussed, ADEQ's program is ambiguous as to whether a proposed final permit, as defined in R18-2-101(114), constitutes final action by the Director. While ADEQ has issued guidance clarifying that it treats “proposed final permits” as final actions for purposes of preconstruction permitting 15 , to obtain full PSD program approval, ADEQ's regulations must make clear that a source may not begin actual construction before a final determination on a PSD permit application is made by the Director.

    15 See ADEQ memo dated February 10, 2015 related to proposed final permits, and ADEQ's February 23, 2015 Supplement at 2.

    Sixth, ADEQ's NSR submittal contains provisions that allow for exclusions from increment consumption, for certain temporary emissions, that do not conform to the requirements in the analogous federal rule. First, ADEQ's rule at R18-2-218(F)(5) requires only the ADEQ Director's approval for temporary emissions beyond two years, but the federal program requirements at 40 CFR 51.166(f)(i)(v) and 51.166(f)(4) require the Administrator's approval to allow temporary emissions that exceed two years. In addition, ADEQ's program language does not reference a specific time period beyond two years that it would allow for exclusions from increment consumption, which is not consistent with the federal regulation's requirement at 40 CFR 51.166(f)(4) that the time for such exclusions be specified in the plan. Finally, the provision at R18-2-218(F)(5)(b)(ii), which references the state ambient air quality standards, must be applied to “any” air quality control region. As currently written this provision does not clearly apply to areas outside of Arizona where Arizona's standards would not generally apply.

    Seventh, ADEQ's submittal contains a provision at R18-2-406(E) providing an exemption for certain portable stationary sources with a prior permit that contains requirements equivalent to the PSD requirements in 40 CFR 51.166 (j) through (r), as allowed by 40 CFR 51.166(i)(1)(iii). However, ADEQ's rule at R18-2-406(E) is worded broadly to also allow an exemption for portable sources that have been permitted under Article 4 of ADEQ's regulations, which also includes nonattainment NSR permits and PAL permits. We do not interpret this federal exemption as generally applying to such permits, as it is not clear that such permits contain requirements “equivalent” to those in 40 CFR 51.166(j) through (r).

    Eight, ADEQ's submittal contains conditions generally meeting the requirements of 40 CFR 51.166(k)(1) in rule R18-2-406(A)(5)(a). However, R18-2-406(A)(5) contains an “or” between subsections (a) and (b) that could be interpreted as allowing a source to demonstrate it will not contribute to an increase above the significance levels in an adjacent nonattainment area in lieu of the demonstration required by R18-2-406(A)(5)(a). The provisions of subsection (b) relate to requirements under a different portion of the NSR program—specifically under 40 CFR 51.165. As such, it is likely ADEQ would interpret subsections (a) and (b) as separate requirements with which a source must demonstrate compliance. Nevertheless, the potential for misinterpretation of this substantive requirement of the PSD program provides a basis for our limited disapproval of the PSD program submittal. In addition, R18-2-406(A)(5)(a) requires that a person applying for a PSD permit demonstrate that the project would not cause a violation of any maximum allowable increase over the baseline concentration in “any attainment or unclassifiable area.” However, ADEQ's definition for “attainment area” in the SIP at R18-2-101(19) limits attainment areas to those “in the state.” In addition, as discussed previously, it is not clear that ADEQ's references to the state's ambient air standards would apply in areas outside of Arizona.

    Ninth, ADEQ's submittal includes R18-2-406(A)(6)(b), which specifies that the use of a modified or substituted model must be subject to public notice and the opportunity for public comment, but neither the rule nor the submittal makes clear the procedures that would be used for notice and comment for this purpose or demonstrates that such procedures would be consistent with 40 CFR 51.102, as required by 40 CFR 51.166(l)(2).

    Tenth, ADEQ's PSD SIP submittal does not appear to specifically address the requirements of 40 CFR 51.166(n)(1) and (3), which require that the SIP must require that (1) the owner or operator of a proposed source or modification shall submit all information necessary to perform any analysis or make any determination required under procedures established in accordance with 40 CFR 51.166, and (2) upon request of the state, the owner or operator shall also provide specified information concerning air quality impacts and growth. ADEQ's submittal at R18-2-304, R18-2-402(G) and R18-2-407 identifies the information necessary for a complete application under this program and requires applicants to respond to deficiencies in the application, but these provisions do not appear to fully address the requirements of 40 CFR 51.166(n)(1) and (3).

    Eleventh, ADEQ's submittal contains an apparent typographical error in R18-2-402(F)(1)(c), which includes a cross-reference to R18-2-401(20)(b)(iii) rather than R18-2-401(20)(b)(iv). See 40 CFR 51.166(r)(6).

    Finally, ADEQ's submittal does not require owners or operators to make information required under 40 CFR 51.166(r)(6) available for review upon request by the Director or the general public pursuant to the requirements in 40 CFR 70.4(b)(3)(viii) as is required by 40 CFR 51.166(r)(7).

    2. Restrictions on Area Classifications

    40 CFR 51.166(e) contains provisions related to restrictions on area classifications (Class I, II, or II). We have identified several deficiencies in ADEQ's program with respect to these provisions.

    First, ADEQ's submittal contains requirements for area classifications in R18-2-217. However, ADEQ's submittal does not completely meet the requirements of 40 CFR 51.166(e) and section 162(a) of the Act, which require certain areas in existence on August 7, 1977 to be designated as Class I areas. Such designations apply to any boundary changes made to those Class I areas after August 7, 1977. While ADEQ generally includes this requirement at R18-2-217(B), its rule limits such boundary changes to those made prior to March 12, 1993.

    Second, ADEQ's NSR submittal at R18-2-217 does not contain a provision consistent with the federal regulatory requirement for Class I area redesignations prior to August 7, 1977 in rule R18-2-217 or elsewhere as required by 40 CFR 51.166(e)(2). Even if it is the case that there are no areas in Arizona that were redesignated Class I prior to August 7, 1977, ADEQ's program must recognize Class I area designations under this provision that may have been made in other states for which sources within ADEQ may have an impact. See 40 CFR 51.166(e)(2).

    Finally, ADEQ's NSR submittal does not include a provision that is fully consistent with 40 CFR 51.166(e)(3). While ADEQ's rules generally meet this requirement at R18-2-217(D), this rule does not fully meet the requirements of 40 CFR 51.166(e)(3) because (1) it is not clear what is meant in ADEQ's rule by “all other areas” and (2) it does not contain a provision that ensures that ADEQ recognizes federal legislation that specified the area classification of a particular area.

    3. Redesignations

    40 CFR 51.166(g) contains provisions allowing certain areas classified as Class I, II, or III to be redesignated to another classification. We have identified several deficiencies in ADEQ's program with these provisions.

    First, ADEQ's submittal contains provisions at R18-2-217(A) identifying that attainment and unclassifiable areas in the State shall be designated as Class I, II, or III. However, this portion of the PSD program applies to all areas of the State. That is, all areas of the State must be designated as Class I, II, or III irrespective of their attainment designation under Section 107 of the Act. See 40 CFR 51.166(g)(1).

    Second, ADEQ's submittal contains provisions at R18-2-217(E) for allowing the state to redesignate certain areas, but the submittal does not adequately meet the public participation requirements specified in the federal regulation at 40 CFR 51.166(g)(2)(i), which requires a public hearing consistent with the procedures in 40 CFR 51.102. ADEQ's redesignation provisions do not specify the public hearing procedures that will be used. See 40 CFR 51.166(g)(2)(i).

    Third, ADEQ's provisions for redesignating areas to Class III do not clearly identify which areas may be designated as Class III as specified in 40 CFR 51.166(g)(3).

    Fourth, R18-2-217(E) allows for the redesignation to be approved by the Governor or the Governor's designee. However, the federal program at 40 CFR 51.166(g)(3)(ii) specifically requires the Governor's approval and does not allow for this approval to be delegated. See 40 CFR 51.166(g)(3)(ii).

    Fifth, R18-2-217(F)(4) contains a reference to “maximum allowable concentration” which appears to refer to R18-2-218(E). However, R18-2-218(E) references the “ambient air quality standards in this Article.” The state's ambient air quality standards do not generally apply in areas outside of Arizona, and ADEQ's NSR submittal does not demonstrate that they would apply outside of Arizona for purposes of R18-2-217(F)(4). See 40 CFR 51.166(g)(3)(iii).

    Finally, ADEQ's provisions do not clearly require that a permit application that can only be approved if an area is redesignated to Class III, and material submitted as part of that application, must be available for public inspection prior to the public hearing on the redesignation to Class III. See 40 CFR 51.166(g)(3)(iv).

    4. Impacts on Class I Areas

    40 CFR 51.166(p) contains additional requirements related to protection of Federal Class I areas. We have identified several deficiencies in ADEQ's program with these provisions.

    First, ADEQ's submittal does not address the requirements of 40 CFR 51.166(p)(1), but they are generally addressed by existing SIP requirements in R9-3-304(H). However, the existing SIP only requires application information to be submitted to the Federal Land Manager, and does not require that this information be provided to EPA as required by this provision. Consistent with 40 CFR 51.166(p)(2), the Federal Land Manager works in consultation with EPA on the protection of Class I lands.

    Second, ADEQ's submittal does not address the requirement under 40 CFR 51.166(p)(3), but it is addressed by the existing SIP requirement in R9-3-304(H)(1). However, the existing SIP contains outdated maximum allowable increases that must be updated. See 40 CFR 51.166(p)(3).

    Finally, ADEQ's submittal generally includes the provisions of 40 CFR 51.166(p)(4) at R18-2-406(F)(2), but contains the phrase “no significant adverse impacts,” which is inconsistent with the federal regulation which requires a demonstration of “no adverse impacts.” The addition of the word “significant” is somewhat ambiguous in this context, but appears to allow variances under circumstances not allowed under the analogous federal regulation.

    5. Public Participation

    40 CFR 51.166(q) contains several specific public participation requirements for issuing PSD permits. We have identified several public participation deficiencies in ADEQ's program.

    First, ADEQ's submittal does not ensure that materials available during the public comment period are available in each region in which the proposed source would be constructed as required by 40 CFR 51.166(q)(2)(ii). While ADEQ's program at R18-2-330(D)(11) requires these materials to be available at the nearest Department office, ADEQ only has two Department offices. As such, it is not clear that in all instances the public affected by a proposed project would have reasonable access in their region to the materials specified in 40 CFR 51.166(q)(2)(ii).

    Second, ADEQ's submittal does not require ADEQ to notify the public of (1) the degree of increment consumption that is expected from the source or modification, or (2) the Director's preliminary determination, as required by 40 CFR 51.166(q)(2)(iii).

    Third, ADEQ's submittal does not require ADEQ to make the public comments and the written notification of its final determination available in the same location as the preliminary documents as required by 40 CFR 51.166(q)(2)(vi) and (viii).

    Finally, ADEQ's submittal requires the Director to take final action on an application within one year of receipt of a complete application—R18-2-402(I)(3). See 40 CFR 51.166(q)(2)(vii). However, ADEQ's program also indicates that a source may begin actual construction once a “proposed final permit” is obtained. See R18-2-402(C) and R18-2-302(G). ADEQ's regulations are ambiguous as to whether a proposed final permit, as defined in R18-2-101(114), constitutes final action by the Director that is subject to administrative and/or judicial review. As EPA has stated previously in the context of our actions on other State SIP submittals, we interpret the CAA to require an opportunity for judicial review of a decision to grant or deny a PSD permit, whether issued by EPA or by a State under a SIP-approved or delegated PSD program. 77 FR 65305, 65306, Oct. 26, 2012 (EPA's approval of the San Joaquin Valley Unified Air Pollution Control District's PSD program into the California SIP); see also 61 FR 1880, 1882. Jan. 24, 1996 (EPA's proposed disapproval of Virginia's PSD program SIP revision due to State law standing requirements that limited judicial review); 72 FR 72617, 72619, Dec. 21, 2007 (in approving South Dakota's PSD program, EPA stated that it interprets the CAA and regulations to require at minimum an opportunity for state judicial review of PSD permits). EPA continues to interpret the relevant provisions of the Act as described in these prior rulemaking actions. While ADEQ has issued guidance clarifying that it treats “proposed final permits” as “appealable agency actions,” under Arizona law,16 in order to obtain full PSD program approval, ADEQ's regulations must make clear that a source may not begin actual construction before a final determination on a PSD permit application is made by the Director, which would be subject to administrative and/or judicial review.

    16 See ADEQ memo dated February 10, 2015 related to proposed final permits. ADEQ submitted this memo in its February 23, 2015 supplement.

    6. Plantwide Applicability Limits

    ADEQ's rules contain provisions for using plantwide applicability limits (PALs) in R18-2-412. We have identified the following deficiencies with ADEQ's PALs provisions program as they relate to the PSD program.

    First, neither the ADEQ regulatory provisions for PALs at R18-2-412 nor the ADEQ regulatory definitions in R18-2-401 that apply in the context of major sources and major modifications contain a definition for major emissions unit as is required by 40 CFR 51.166(w)(2)(iv). (This term is also not included in the definitions at R18-2-101 or R18-2-301 that ADEQ submitted for approval as part of this action.)

    Second, ADEQ's PAL provision for calculating baseline emissions at R18-2-412(B)(2) does not specify that baseline actual emissions are to include emissions associated not only with operation of the unit, but also emissions associated with startup, shutdown and malfunction, as is required by 40 CFR 51.166(w)(3)(ii).

    Third, ADEQ's PAL provisions at R18-2-412(H) contain an incorrect reference to (H)(4) instead of the definition for major modification, and R18-2-412(H)(5) uses “eliminated” where the federal regulation uses “established.” See 40 CFR 51.166(w)(9).

    Finally, ADEQ's PAL renewal provisions at R18-2-412(I)(1) must contain a reference to subsection (D) of R18-2-412 instead of (F). In addition, R18-2-(I)(4)(a) must reference subsection (E) of R18-2-412. See 40 CFR 51.166(w)(10).

    7. Definitions

    ADEQ's submittal contains definitions applicable to the PSD program that do not fully meet the requirements of 40 CFR 51.166(b)(1), which requires each State plan to contain specific definitions for the PSD program. Deviations from the wording are approvable if the State specifically demonstrates that the submitted definition is more stringent, or at least as stringent, in all respects as the corresponding definition in 40 CFR 51.166(b). We have carefully reviewed the definitions used in ADEQ's PSD program as compared with the federal PSD definitions in 40 CFR 51.166(b) and have found that, generally, ADEQ's submittal contains the definitions necessary to implement a PSD program. However, a number of ADEQ's definitions do not meet the requirements of 40 CFR 51.166(b)(1) because their wording deviates from the wording in the corresponding federal regulatory definitions in 40 CFR 51.166(b)(1) in a manner that may be less stringent than the federal definitions, and the State has not demonstrated otherwise.

    Major stationary source at 40 CFR 51.166(b)(1)—language from subparagraph 40 CFR 51.166(b)(1)(i)(c) not included in the definition at R18-2-101(75). See also discussion below of the definition of “stationary source” in 40 CFR 51.166(b)(5).

    Net emissions increase at 40 CFR 51.166(b)(3)—ADEQ's definition at R18-2-101(87)(c) identifies that an increase or decrease in actual emissions is creditable only to the extent that the Director has not relied on it in issuing a permit. However, this definition is broader than the definition in the PSD program, which only specifies that the reviewing authority has not relied on the increase or decrease in issuing a PSD permit. In some respects this makes ADEQ's definition more stringent (decreases), but in other respects less stringent (increases). In addition, the equivalent of paragraph 40 CFR 51.166(b)(3)(viii) is not included in ADEQ's definition at R18-2-101(87).

    Stationary source at 40 CFR 51.166(b)(5)—the federal regulation at 40 CFR 51.166(b)(5) defines this term as “any building, structure, facility or installation which emits or may emit a regulated NSR pollutant,” with “regulated NSR pollutant” also being a federally defined term at 40 CFR 51.166(b)(49), whereas ADEQ's regulation at R18-2-101(39) defines “stationary source” as “any building, structure, facility or installation subject to regulation pursuant to A.R.S. § 49-426(A) which emits or may emit any air pollutant,” with “air pollutant” being an undefined term in ADEQ's regulation. We note that A.R.S. § 49-426(A) provides a cross-reference to certain exemptions from permitting identified in A.R.S. § 49-426(B), specifically agricultural equipment used in normal farm operations and certain fuel burning equipment, which do not appear to be consistent with the federal PSD definition. The federal definition for stationary source is very broad and does not exclude these source categories. We agree that it is acceptable for ADEQ to limit its NSR program to certain kinds of stationary sources, as specified in 40 CFR 51.160(e), but the federal definition for a stationary source in the context of the PSD program is not the appropriate place for such an exclusion, as it does not allow exclusions for certain source categories.

    Major source baseline date at 40 CFR 51.166(b)(14)—language equivalent to paragraph 40 CFR 51.166(b)(14)(iv) is not included at ADEQ's definition in R18-2-218(B)(1).

    Baseline area 40 CFR 51.166(b)(15)—ADEQ's definition at R18-2-218(D) contains an incorrect reference to R18-2-217 rather than referring to section 107(d)(1)(A)(ii) or (iii) of the Act or the equivalent; also, language equivalent to that in paragraph 40 CFR 51.166(b)(15)(iii) is not included.

    Allowable emissions at 40 CFR 51.166(b)(16)—ADEQ's definition at R18-2-101(13)(b) does not include the “future compliance date” language that is in 40 CFR 51.166(b)(16)(ii) and ADEQ has not demonstrated that its regulatory language is at least as stringent as the federal definition.

    Federally enforceable at 40 CFR 51.166(b)(17)—ADEQ's definition at R18-2-101(53)(d) identifies that requirements included in permits pursuant to R18-2-306.01 or R18-2-306.02 are included in the definition of federally enforceable requirements, but excludes those requirements that are identified as “enforceable only by the state.” With this action, we approving R18-2-306.01 and R18-2-306.02 into the SIP, making requirements pursuant to these rules federally enforceable. As such, ADEQ does not have the discretion to identify some of those requirements as only enforceable by the state.

    Complete at 40 CFR 51.166(b)(22)—ADEQ's definition at R18-2-401(4) is missing the second sentence of the federal definition.

    Significant at 40 CFR 51.166(b)(23)- ADEQ definition at R18-2-101(130)(e) uses “milligrams” instead of “micrograms” as required in paragraph 40 CFR 51.166(b)(23)(iii).

    Projected actual emissions at 40 CFR 51.166(b)(40)—ADEQ's definition at R18-2-401(20)(b)(iii) does not specifically require inclusion of emissions from malfunctions in the determination of projected actual emissions, and exempts emissions from a shutdown associated with a malfunction from such determination, while the federal definition at 40 CFR 51.166(b)(40)(ii)(b) requires that emissions from both shutdowns and malfunctions be included.

    Subject to regulation at 40 CFR 51.166(b)(48)—this definition is not included in ADEQ's NSR SIP submittal. ADEQ did not adopt a definition for the term “subject to regulation” or include such definition as part of the NSR SIP submittal, presumably because the federal definition of the term contains the requirements of the Greenhouse Gas (GHG) Tailoring Rule, and GHGs cannot be regulated under Arizona state law.17 We note, however, that while the GHG program requirements are contained as part of the definition of the term “subject to regulation,” the federal definition of this term also contains non-GHG-specific program elements for determining when a pollutant is “subject to regulation.” As such, ADEQ must add a definition to its PSD regulations to address these elements of the term “subject to regulation” in order to obtain full program approval.

    17 ADEQ is currently subject to a Federal Implementation Plan under the PSD program for GHGs because ADEQ did not adopt a PSD program for the regulation of GHGs. See 40 CFR 52.37. ADEQ's NSR SIP submittal does not attempt to correct this program deficiency, as regulation of GHG emissions currently is not permitted under State law. See A.R.S. § 49-191.

    Regulated NSR pollutant at 40 CFR 51.166(b)(49)—ADEQ's regulatory definition at R18-2-101(122) does not include the final two sentences of 40 CFR 51.166(b)(49)(i)(a)or the language at 40 CFR 51.166(b)(49)(iv); ADEQ's definition also includes an incorrect cross-reference to hazardous air pollutants listed under R18-2-1101 that is not consistent with the requirements in 40 CFR 51.166(b)(49)(v); and ADEQ's regulatory definition needs to update the July 1, 2010 date in the cross-reference to CAA section 108.

    8. PM2.5 Significant Monitoring Concentration

    On January 22, 2013, the U.S. DC Circuit Court of Appeals in Sierra Club v. EPA, 705 F.3d 458, vacated the parts of two federal PSD rules (40 CFR 51.166(i)(5)(i)(c) and 40 CFR 52.21(i)(5)(i)(c)) establishing a PM2.5 significant monitoring concentration (SMC), finding that EPA was precluded from using the PM2.5 SMC to exempt permit applicants from the statutory requirement to compile and submit preconstruction monitoring data as part of a complete PSD application. On December 9, 2013, revisions to 40 CFR 51.166 and 52.21 were published in the Federal Register to remove these vacated rule elements, effective as of that date. See 78 FR 73698.

    ADEQ's submittal at R18-2-407(H)(1)(c) contains the equivalent of the PM2.5 SMC that was vacated by the Court of Appeals and which has been removed from the federal PSD regulations. As the Court of Appeals found application of this SMC impermissible, and because ADEQ's regulation incorporating this SMC is a separable portion of ADEQ's PSD program, we are proposing a partial disapproval of ADEQ's submitted PSD program, to disapprove R18-2-407(H)(1)(c).

    9. Definition for Basic Design Parameter

    ADEQ's submittal contains a definition for basic design parameter at R18-2-401(3) that reflects the definition that EPA originally developed as part of its Equipment Replacement Provisions. See 68 FR 61248 Oct. 27, 2003. However, the definition for basic design parameter, and other elements related to the Equipment Replacement Provisions, were vacated by the DC Circuit Court of Appeals in State of New York v. EPA, 443 F.3d 880 (D.C. Cir. 2006). While the federal PSD regulations still contain a reference to “basic design parameter,” this term is no longer specifically defined under the federal PSD regulations, and application of the definition contained in the Equipment Replacement Provisions that were vacated by the Court of Appeals is inconsistent with federal PSD requirements. As the Court of Appeals found this Equipment Replacement Provisions and, therefore, this definition, impermissible, and because ADEQ's regulation incorporating this definition is a separable portion of ADEQ's PSD program, we are proposing a partial disapproval of ADEQ's submitted PSD program, to disapprove R18-2-401(3).

    D. Do the rules meet the evaluation criteria for Nonattainment New Source Review?

    Part D of title I of the Act contains the general requirements for areas designated “nonattainment” for the NAAQS, including preconstruction permit requirements for new major sources or major modifications proposing to construct in such nonattainment areas, commonly referred to as “Nonattainment New Source Review” or “NA-NSR.” EPA's regulations for NA-NSR permit programs are found in 40 CFR 51.165. Most areas under ADEQ's jurisdiction are currently designated as “attainment” or “unclassifiable/attainment” for all NAAQS pollutants. However, there are some areas under ADEQ's jurisdiction that are nonattainment and warrant a NA-NSR program. See 40 CFR 81.303.

    R18-2-402 through 405 contain the substantive NA-NSR requirements for review and permitting of major sources and major modifications in nonattainment areas under ADEQ jurisdiction in Arizona. These regulations satisfy most of the statutory and regulatory requirements for NA-NSR permit programs, but these rules contain several deficiencies that that do not allow us to fully approve the NA-NSR program submittal that is the subject of this action, as discussed below.

    Although ADEQ's NA-NSR program submittal meets most NA-NSR program requirements, we are proposing to disapprove one specific aspect of ADEQ's NA-NSR program relating to the definition of “basic design parameter.” The ADEQ rule provision that we are proposing to disapprove is directly comparable to a federal NA-NSR rule provision that has been vacated by a federal court, and we find that it is separable from the remainder of ADEQ's NA-NSR program. Accordingly, we find this provision suitable for disapproval at this time. This issue is described in more detail below in Section II.D.4.

    For most of the remainder of ADEQ's NA-NSR program submittal, we are proposing limited approval and limited disapproval. We find that approval of ADEQ's updated NA-NSR program, aside from the aspect that is separable and is proposed for disapproval as mentioned above, will substantially strengthen the SIP overall, particularly as the current SIP-approved NA-NSR program is significantly out of date when compared with current federal NA-NSR regulatory requirements as well as current State regulations. See our discussion in Section G below. However, specific provisions of the NA-NSR SIP program submittal are inconsistent with NA-NSR program requirements, and these deficiencies must be addressed before we can fully approve ADEQ's NA-NSR program into the SIP. The deficiencies that we have identified with ADEQ's NA-NSR program that provide the basis for our limited approval and limited disapproval are described immediately below in Sections II.D.1 through 3.18

    18 For one other aspect of ADEQ's NA-NSR SIP submittal, we are proposing limited approval at this time. We cannot determine at this time whether ADEQ's NA-NSR SIP submittal adequately addresses all of elements necessary to satisfy the CAA's title I, part D, subpart 4 requirements regarding NSR permitting of PM2.5 and PM10 precursors under CAA section 189(e). This issue is discussed in detail in Section II.D.5 below.

    1. General Nonattainment NSR Program Requirements

    First, as discussed above with respect to ADEQ's PSD program submittal, ADEQ's NA-NSR program submittal often refers to Articles 9 and/or 11 of ADEQ's regulations where the federal regulations refer to 40 CFR parts 60, 61, or 63; or, similarly, sections 111 or 112 of the Act. See R18-2-101(122)(b); R18-2-401(10); R18-2-402(G)(2); and R18-2-406(A)(4). Articles 9 and 11 are where ADEQ incorporates by reference the federal regulations in 40 CFR parts 60, 61, and 63 (which EPA implements under sections 111 and 112 of the Act). However, these Articles are not in the SIP, have not been submitted for SIP approval, and do not necessarily contain provisions equivalent to all of the subparts in parts 60, 61, and 63. See 40 CFR 51.165(a)(1)(xiii)—lowest achievable emission rate, (a)(1)(xxxvii)—regulated NSR pollutant, and (a)(1)(xl)—best available control technology.

    Second, the nonattainment NSR program requirements at 40 CFR 51.165(a)(2) require each plan to have a preconstruction review program to satisfy the requirements of sections 172(c) and 173 of the Act. However, as previously discussed in this preamble, ADEQ's submittal allows a source at R18-2-302(G) and R18-2-402(C) to begin actual construction upon the issuance of a proposed final permit. ADEQ's program is ambiguous as to whether a proposed final permit, as defined in R18-2-101(114), constitutes final action by the Director. While ADEQ has issued guidance clarifying that it treats “proposed final permits” as final actions for purposes of preconstruction permitting,19 to obtain full NA-NSR program approval, ADEQ's regulations must make clear that a source may not begin actual construction before a final determination on an NA-NSR permit application is made by the Director.

    19 See ADEQ Memo dated February 10, 2015 related to proposed final permits and ADEQ's February 23, 2015 Supplement at 2.

    Third, 40 CFR 51.165(a)(3)(ii)(G) requires that credit for emission reductions can be claimed only to the extent that the reviewing authority has not relied on it in issuing any permit under regulations approved pursuant to 40 CFR 51 subpart I or the State has not relied on it in demonstration of attainment or reasonable further progress. ADEQ's NSR submittal generally addresses this requirement at R18-2-404(H), but also needs to include references to rules R18-2-302.01 and R18-2-334, which are to be approved as part of ADEQ's NSR regulations under Subpart I.

    Fourth, ADEQ's submittal contains an apparent typographical error in R18-2-402(F)(1)(c), which includes a cross-reference to R18-2-401(20)(b)(iii) rather than R18-2-401(20)(b)(iv). This error must be corrected to ensure that the requirement in 40 CFR 51.165(a)(6)(i)(c) for owners and operators to document and maintain a record of certain applicability-related information is satisfied.

    Fifth, ADEQ's submittal does not require owners or operators to make information required under 40 CFR 51.165(a)(6) available for review upon request by the Director or the general public pursuant to the requirements in 40 CFR 70.4(b)(3)(viii) as is required by 40 CFR 51.165(a)(7).

    Sixth, 40 CFR 51.165(a)(9)(i) requires that increases in emissions shall be offset by reductions in emissions using a ratio of emission decreases to emission increases of at least 1 to 1. ADEQ's NA-NSR submittal contains this requirement at R18-2-404(A), but could be interpreted as establishing the ratio as increases to decreases, instead of decreases to increases—“emission increases shall be offset by emission decreases at a ratio of at least 1 to 1.” In addition, R18-2-404(A) refers to additional offset requirements in R18-2-405, but does not refer to the offset requirement in R18-2-404(J).

    Seventh, 40 CFR 51.165(a)(11) requires emission offsets to be obtained for the same regulated NSR pollutant, unless interprecursor offsetting is permitted for a particular pollutant, as further specified in the rule. ADEQ's NA-NSR SIP submittal does not address interprecursor offsets, and it is not required to, but the submittal does not contain a specific requirement that offsets must be for the same regulated pollutant.

    Eighth, 40 CFR 51.165(b) requires that ADEQ have a preconstruction program that satisfies the requirements of section 110(a)(2)(D)(i) of the Act for any new major stationary source or major modification that would locate in an attainment area, but would cause or contribute to a violation of a NAAQS in any adjacent area. ADEQ's program contains provisions for 40 CFR 51.165(b) at R18-2-406(A)(5)(a)-(b) that generally meet this requirement. However, ADEQ's regulations at R18-2-406(A)(5)(b) refer to the “Arizona primary or secondary ambient air quality standards,” which is not a defined term, whereas the analogous federal program provisions refer to the NAAQS. As a result, ADEQ's program does not fully meet the requirements in 40 CFR 51.165(b)(1) and (2) as ADEQ's regulations do not make clear which standards are being referred to, and the submittal does not demonstrate that such standards would apply to areas outside of Arizona for purposes of ADEQ's NSR review. Similarly, ADEQ's regulation at R18-2-406(A)(5)(a) references the state's ambient air quality standards in Article 2, which would not clearly apply to areas outside of Arizona.

    Finally, Section 173(a)(4) of the Act requires that NA-NSR permit programs shall provide that permits to construct and operate may be issued if “the Administrator has not determined that the applicable implementation plan is not being adequately implemented for the nonattainment area in which the proposed source is to be constructed or modified.” However, ADEQ's program does not contain a provision that would prohibit the issuance of NA-NSR permits in areas where the Administrator has made this determination or that requires that ADEQ conduct a review to ensure that this requirement is met. To obtain full program approval, ADEQ must add a provision to its NA-NSR program requirements that ensures compliance with CAA section 173(a)(4).

    2. Plantwide Applicability Limits

    ADEQ's rules contain provisions for using plantwide applicability limits (PALs) in R18-2-412. We have identified the following deficiencies with ADEQ's PALs provisions program as they relate to the NA-NSR program.

    First, ADEQ's provision for PALs does not specify that modifications under a PAL do not need approval through the nonattainment major NSR program. Only the PSD program is mentioned. ADEQ's submittal does not contain a definition for nonattainment major NSR program (see 40 CFR 51.165(a)(1)(xxx)). ADEQ should either add this definition or considering referencing R18-2-403. See 40 CFR 51.165(f)(1)(iii)(B).

    Second, neither the ADEQ regulatory provisions for PALs at R18-2-412 nor the ADEQ regulatory definitions in R18-2-401 that apply in the context of major sources and major modifications contain a definition for major emissions unit as is required by 40 CFR 51.165(f)(2)(iv).

    Third, ADEQ's PAL provision for calculating baseline emissions at R18-2-412(B)(2) does not specify that baseline actual emissions are to include emissions associated not only with operation of the unit, but also emissions associated with startup, shutdown and malfunction, as is required by 40 CFR 51.165(f)(3)(ii).

    Fourth, ADEQ's PAL provisions at R18-2-412(H) contain an incorrect reference to R18-2-412(H)(4) instead of the definition for major modification, and R18-2-412(H)(5) uses “eliminated” where the federal regulation uses “established.” See 40 CFR 51.165(f)(9).

    Finally, ADEQ's program contains incorrect cross-references in meeting the requirements of 40 CFR 51.165(f)(1), as follows: ADEQ's PAL renewal provisions at R18-2-412(I)(1) must contain a reference to subsection (D) of R18-2-412 instead of (F), and R18-2-(I)(4)(a) must reference subsection (E) of R18-2-412.

    3. Definitions

    ADEQ's submittal contains definitions applicable to the nonattainment NSR program that do not fully meet the requirements of 40 CFR 51.165(a)(1), which requires each State plan to contain specific definitions for the nonattainment NSR program. Deviations from the wording are approvable if the State specifically demonstrates that the submitted definition is more stringent, or at least as stringent, in all respects as the corresponding definition in 40 CFR 51.165(a)(1). We have carefully reviewed the definitions used in ADEQ's nonattainment NSR program as compared with the federal PSD definitions in 40 CFR 51.165(a)(1) and have found that generally, ADEQ's submittal contains the definitions necessary to implement a NA-NSR program. However, a number of ADEQ's definitions do not meet the requirements of 40 CFR 51.165(a)(1) because their wording deviates from the wording in the corresponding federal regulatory definitions in 40 CFR 51.165(a)(1) in a manner that may be less stringent than the federal definitions, and the State has not demonstrated otherwise.

    Stationary source at 40 CFR 51.165(a)(1)(i)—the federal regulation at 40 CFR 51.165(a)(1)(i) defines this term as “any building, structure, facility or installation which emits or may emit a regulated NSR pollutant,” with “regulated NSR pollutant” also being a federally defined term at 40 CFR 51.165(a)(1)(xxxvii), whereas ADEQ's regulation at R18-2-101(139) defines “stationary source” as “any building, structure, facility or installation subject to regulation pursuant to A.R.S. § 49-426(A) which emits or may emit any air pollutant,” with “air pollutant” being an undefined term in ADEQ's regulation. However, A.R.S. § 49-426(A) provides a cross-reference to certain exemptions from permitting identified in A.R.S. § 49-426(B), specifically agricultural equipment used in normal farm operations and certain fuel burning equipment, which do not appear to be consistent with federal NA-NSR definition. The federal definition of stationary source at 40 CFR 51.165(a)(1)(i) is very broad and does not exclude these source categories from the definition. We agree that it is acceptable for ADEQ to limit its NSR program to certain kinds of stationary sources, as discussed in detail above with respect to 40 CFR 51.160(e), but the federal definition for a stationary source in the context of the major NA-NSR program is not the appropriate place for such an exclusion, as it does not allow exclusions for certain source categories. ADEQ must demonstrate that its definition of stationary source is at least as stringent as the federal definition at 40 CFR 51.165(a)(1)(i) in all respects.

    Major stationary source at 40 CFR 51.165(a)(1)(iv)—language from subparagraph 40 CFR 51.165(a)(1)(iv)(A)(3) not included in the definition at R18-2-101(75); also see comments above on definition of “stationary source” in 40 CFR 51.165(a)(1)(i).

    Net emissions increase at 40 CFR 51.165(a)(1)(vi)—The requirement of paragraph 40 CFR 51.165(a)(1)(vi)(E)(3) is not met because not all requirements to be approved under subpart I are listed (i.e., R18-2-302.01) in the definition at R18-2-101(87). In addition, the equivalent of paragraph 40 CFR 51.165(a)(1)(vi)(G) is not included in ADEQ's definition at R18-2-101(87).

    Significant at 40 CFR 51.165(a)(1)(x)—ADEQ's definition at R18-2-101(130)(b) refers to R18-2-405 for determining significant emissions in serious and severe ozone nonattainment areas. The definition for “significant” at R18-2-405(B) does not use the term “net emissions increase,” which is a term defined by the federal regulations at 40 CFR 51.165(a)(1)(vi).

    Allowable emissions at 40 CFR 51.165(a)(1)(xi)—ADEQ's definition at R18-2-101(13)(b) does not include the “future compliance date” language that is in 40 CFR 51.165(a)(1)(xi)(B) and (C) and ADEQ has not demonstrated that its regulatory language is at least as stringent as the federal definition.

    Federally enforceable at 40 CFR 51.165(a)(1)(xiv)—ADEQ's definition at R18-2-101(53)(d) identifies that requirements included in permits pursuant to R18-2-306.01 or R18-2-306.02 are included in the definition of federally enforceable requirements, but excludes those requirements that are identified as “enforceable only by the state.” With this action, we are approving R18-2-306.01 and R18-2-306.02 into the SIP, making requirements pursuant to these rules federally enforceable. As such, ADEQ does not have the discretion to identify some of those requirements as only enforceable by the state.

    Regulated NSR pollutant at 40 CFR 51.165(a)(1)(xxxvii)—ADEQ's definition is missing this language from paragraph 40 CFR 51.165(a)(1)(xxxvii)(C): “provided that such constituent or precursor pollutant may only be regulated under NSR as part of regulation of the general pollutant” at R18-2-101(122)(a).

    Projected actual emissions at 40 CFR 51.165(a)(1)(xxviii)—ADEQ's definition at R18-2-401(20)(b)(iii) does not specifically require inclusion of emissions from malfunctions in the determination of projected actual emissions, and exempts emissions from a shutdown associated with a malfunction from such determination, while the federal definition at 40 CFR 51.165(a)(1)(xxxvii)(C) requires that emissions from both shutdowns and malfunctions be included.

    4. Definition for Basic Design Parameter

    ADEQ's submittal contains a definition for basic design parameter at R18-2-401(3) that reflects the definition that EPA originally developed as part of its Equipment Replacement Provisions. See 68 FR 61248, Oct. 27, 2003. However, the definition for basic design parameter, and other elements related to the Equipment Replacement Provisions, were vacated by the DC Circuit Court of Appeals in State of New York v. EPA, 443 F.3d 880 (D.C. Cir. 2006). While the federal NA-NSR regulations still contain a reference to “basic design parameter,” this term is no longer specifically defined under the federal NA-NSR regulations, and application of the definition contained in the Equipment Replacement Provisions that were vacated by the Court of Appeals is inconsistent with federal NA-NSR requirements. As the Court of Appeals found this Equipment Replacement Provisions and, therefore, this definition, impermissible, and because ADEQ's regulation incorporating this definition is a separable portion of ADEQ's NA-NSR program, we are proposing a partial disapproval of ADEQ's submitted NA-NSR program, to disapprove R18-2-401(3).

    5. Additional Provisions for Particulate Matter Nonattainment Areas

    On January 4, 2013, the U.S. Court of Appeals for the District of Columbia Circuit, in Natural Resources Defense Council v. EPA,20 issued a decision that remanded the EPA's 2007 and 2008 rules implementing the 1997 PM2.5 NAAQS. EPA's 2008 implementation rule addressed by the court decision, “Implementation of New Source Review (NSR) Program for Particulate Matter Less Than 2.5 Micrometers (PM2.5)” (the 2008 NSR PM2.5 Rule),21 promulgated NSR requirements for implementation of PM2.5 in both nonattainment areas (under the NA-NSR program) and attainment/unclassifiable areas (under the PSD program). The Court of Appeals found that EPA erred in implementing the PM2.5 NAAQS in these rules for nonattainment areas solely pursuant to the general implementation provisions of subpart 1 of part D of title I of the CAA, rather than pursuant to the additional implementation provisions specific to particulate matter nonattainment areas in subpart 4. The Court of Appeals ordered the EPA to “repromulgate these rules pursuant to Subpart 4 consistent with this opinion.” 706 F.3d at 437. Although the Court of Appeals declined to establish a deadline for EPA's response to the remand, EPA intends to promulgate new generally applicable implementation regulations for the PM2.5 NAAQS in accordance with the requirements of subpart 4. In the interim, however, states and EPA still need to proceed with implementation of the PM2.5 NAAQS in a timely and effective fashion in order to meet statutory obligations under the CAA and to assure the protection of public health intended by those NAAQS.

    20 706 F.3d 428 (D.C. Cir. 2013).

    21 73 FR 28321 May 16, 2008.

    ADEQ's NSR SIP submittal generally includes requirements for the PM2.5 NA-NSR program consistent with the provisions promulgated in the 2008 NSR PM2.5 Rule. Specifically, ADEQ's NSR SIP submittal includes the PM2.5 significant emission rates at R18-2-101(130), regulation of certain PM2.5 precursors (SO2 and NOX) at R18-2-101(130), the regulation of PM10 and PM2.5 condensable emissions at R18-2-101(122)(f), and the emissions offset requirements at R18-2-403(A)(3). Separate and aside from the issues identified above that have resulted in our proposing limited approval and limited disapproval of ADEQ's NA-NSR submittal, EPA has determined that it is not prepared at this time to grant full approval to ADEQ's NSR SIP submittal as to the PM2.5 NA-NSR program requirements, in light of the Court's remand of the 2008 NSR PM2.5 Rule, and for the reasons explained below.

    EPA is in the process of evaluating the requirements of subpart 4 as they pertain to NA-NSR. In particular, subpart 4 includes section 189(e) of the CAA, which requires the control of major stationary sources of PM10 precursors (and hence under the court decision, PM2.5 precursors) “except where the Administrator determines that such sources do not contribute significantly to PM-10 levels which exceed the standard in the area.” Although ADEQ's NSR SIP submittal does include regulation of SO2 and NOX as PM2.5 precursors, it does not include the regulation of VOCs or ammonia. Nor does the NSR SIP submittal include a demonstration as to whether or not the regulation of VOCs or ammonia is necessary under section 189(e). The evaluation of which precursors need to be controlled to achieve the standard in a particular area is typically conducted in the context of the state's preparing and the EPA's reviewing an area's attainment plan SIP. In this case, there are two designated PM2.5 nonattainment areas in Arizona, the Nogales (portion of Santa Cruz County, AZ) and West Central Pinal (portion of Pinal County, AZ) areas. Both are designated nonattainment for the 2006 annual PM2.5 NAAQS. However, on January 7, 2013 and September 4, 2013, EPA finalized determinations of attainment for these areas, respectively (78 FR 887 and 78 FR 54394), which suspended the requirement for the state to submit, among other things, an attainment plan SIP for the area.22 Accordingly, PM2.5 attainment plans for SIP approval are not currently before Region 9 for these areas. As Region 9 does not have before it the state's analysis as to which precursors need to be controlled in these areas pursuant to section 189(e) of the Act, as would be generally contained in an attainment plan SIP, it cannot fully approve as complying with the CAA a nonattainment NSR SIP that only addresses a subset of the scientific PM2.5 precursors recognized by EPA.

    22 Prior to the Court's decision, EPA would not have reviewed PM2.5 attainment plan submittals for compliance with Section 189.

    On the other hand, while ADEQ's submittal may not yet contain all of the elements necessary to satisfy the CAA requirements when evaluated under subpart 4, the NA-NSR SIP submittal represents a considerable strengthening of the currently approved Arizona SIP, which does not address NSR permitting for PM2.5 at all. Therefore, EPA is proposing to grant limited approval to the PM2.5 NA-NSR provisions in ADEQ's NSR submittal for the Nogales and West Central Pinal PM2.5 nonattainment areas.

    For the reasons explained above, EPA is not evaluating at this time whether ADEQ's NA-NSR submittal will require additional revisions relating to PM2.5 to satisfy the subpart 4 requirements. Once EPA re-promulgates the Federal PM2.5 regulations with respect to NA-NSR permitting in response to the Court's remand, EPA will consider whether a limited disapproval should also be proposed for ADEQ's PM2.5 NA-NSR program based on this issue.

    In addition, section 189(e) of the CAA requires that ADEQ's NSR program for PM10 nonattainment areas apply to major stationary sources of PM10 precursors, except where the Administrator determines that such sources do not contribute significantly to PM10 levels which exceed the standard in the area. As discussed below, we have identified one area under ADEQ's jurisdiction, the West Pinal PM10 nonattainment area, for which we are proposing a limited approval with respect to PM10 under section 189(e) of the Act.

    On September 4, 2013, the West Pinal area was redesignated to nonattainment for the 1987 p.m.10 standard. ADEQ's NSR SIP submittal generally includes NA-NSR requirements for PM10 nonattainment areas such as the PM10 significant emission rate at R18-2-101(130), the regulation of PM10 and PM2.5 condensable emissions at R18-2-101(122)(f), and the emissions offset requirements at R18-2-403(A)(3). However, separate and aside from the issues identified above that have resulted in our proposing limited approval and limited disapproval of ADEQ's NA-NSR submittal, EPA has determined that it is not prepared at this time to grant full approval to ADEQ's NSR SIP submittal as to the PM10 nonattainment NSR program requirements for the West Pinal nonattainment area. The evaluation of which precursors need to be controlled to achieve the standard in a particular area is typically conducted in the context of the state's preparing and the EPA's reviewing of an area's attainment plan SIP. On February 19, 2014, ADEQ withdrew from EPA's consideration the Arizona State Implementation Plan Revision for the West Pinal County PM10 Nonattainment Area (submitted on December 30, 2013). Accordingly, a PM10 attainment plan for West Pinal is not currently before Region 9. As such, Region 9 does not have before it the state's analysis as to which precursors need to be controlled in this area pursuant to section 189(e) of the Act, as would be generally contained in an attainment plan SIP, and cannot fully approve as complying with the CAA a nonattainment NSR SIP that does not address scientific PM10 precursors recognized by EPA.

    While ADEQ's submittal may not yet contain all of the elements necessary to satisfy the CAA NA-NSR requirements when evaluated under subpart 4, the proposed revisions to ADEQ's NA-NSR program represent a considerable strengthening of the currently approved Arizona SIP, which does not address NSR requirements for PM10 at all. Therefore, EPA is proposing to grant limited approval to the PM10 NA-NSR provisions in ADEQ's NSR submittal as they apply to the West Pinal nonattainment area. Once ADEQ submits a new PM10 attainment plan for this area, EPA will consider whether a limited disapproval should also be proposed based on this issue.

    E. Review of Non-NSR Related Rules and Statutory Provisions

    In addition to ADEQ's NSR SIP submittal, we are taking action on rules R18-2-311 and R18-2-312. These rules were submitted to EPA for SIP approval in a separate submittal on July 28, 2011. We delayed acting on rules R18-2-311 and R18-2-312 in a previous action, and are therefore now evaluating and taking action on the rules. We are also taking action on A.R.S. § 49-107, an Arizona statutory provision concerning local delegation of state authority.

    First, ADEQ's rule R18-2-311 specifies the test methods and procedures which can be used to determine compliance with requirements established under ADEQ's air program. On October 19, 1984, EPA approved an earlier version of this rule into the SIP.23 See 49 FR 41026. The current submittal, adopted effective November 15, 1993, renumbers the earlier rule and expands on the previous version by listing additional test methods that may be used to determine compliance. While the current rule improves on the earlier version, we cannot recommend it for full approval into the SIP. We are proposing a limited disapproval because Section D of the rule allows the State to approve alternatives to the applicable SIP without EPA approval, in conflict with the requirements of CAA sections 110(a)(2)(A) and 110(i).24

    23 The rule was previously numbered R9-3-310.

    24 See, e.g., “Guidance Document for Correcting VOC Rule Deficiencies,” U.S. EPA Region 9, April 1991, revised August 21, 2001 (Little Bluebook).

    Second, ADEQ's rule R18-2-312 requires stationary sources to conduct a performance test within 60 days of achieving the capability to operate at its maximum production rate, but no later than 180 days after initial start-up. The rule also specifies that testing shall be conducted under such conditions specified by State, including, but not limited to appropriate test methods, notification to the State, data reduction, records, and number of test runs. On April 23, 1982 (47 FR 17485) EPA approved a version of this rule into the SIP.25 The current submittal, adopted effective November 15, 1993, renumbers the earlier rule and expands on the previous version by including conditions when a test may be stopped and allows compliance to be determined with continuous emission monitoring as long as the applicable quality assurance procedures are followed. While the current rule improves on the earlier version, we cannot recommend it for full approval into the SIP. We are proposing a limited disapproval because Section B of the rule allows the State to approve the use of equivalent and alternative test methods without EPA approval, in conflict with CAA sections 110(a)(2)(A) and 110(i).26

    25 The rule was previously numbered R9-3-312.

    26 See, e.g., Little Bluebook.

    Third, A.R.S. § 49-107 is the current Arizona state law that provides ADEQ with authority to “delegate to a local environmental agency, county health department, public health services district or municipality any functions, powers or duties which the director believes can be competently, efficiently and properly performed by the local agency if the local agency accepts the delegation and agrees to perform the delegated functions, powers and duties according to the standards of performance required by law and prescribed by the director,” and other related authorities. This statutory provision establishes that ADEQ has clear authority to delegate various functions under the CAA, including NSR permitting, to county and other local government agencies and, as such, we find it to be approvable and propose to approve it into the SIP. This provision will replace 7-1-8.3(R9-3-803)—Delegation of Authority, an older ADEQ currently in the SIP, which we are proposing to remove from the SIP as part of this action.

    F. Review of Rules and Statutory Provisions Requested To Be Removed From the SIP

    In Table 2 of this preamble we identify the rules and statutory provisions we are proposing to remove or supersede from the SIP as part of this action. ADEQ's existing SIP-approved NSR rules are generally outdated, as we have not acted to approve substantial revisions to ADEQ's NSR rules since the 1980s. Further, the ADEQ NSR rules currently in the SIP have been repealed for purposes of State law by ADEQ. Significant changes have been made to the Act and the underlying implementing federal NSR regulations since our last substantial action on ADEQ's NSR SIP. Therefore, replacing the existing, outdated NSR SIP rules with the updated ADEQ rules in this submittal that we propose to approve into the SIP is appropriate and generally serves as an overall strengthening of Arizona's SIP. In some cases, we approved updated versions of these rules into the SIP in previous rulemaking actions, and a few of the rules proposed for removal are no longer necessary for other reasons. Our TSD provides additional detail.

    G. Do the rules meet the evaluation criteria under Section 110(l) and 193 of the Act?

    CAA Section 110(l) states: “Each revision to an implementation plan submitted by a State under this chapter shall be adopted by such State after reasonable notice and public hearing. The Administrator shall not approve a revision of a plan if the revision would interfere with any applicable requirement concerning attainment and reasonable further progress (as defined in section 7501 of this title), or any other applicable requirement of this chapter.”

    With respect to the procedural requirements of CAA section 110(l), based on our review of the public process documentation included in the July 28, 2011, October 29, 2012 and July 2, 2014 submittals, we find that ADEQ has provided sufficient evidence of public notice and opportunity for comment and public hearings prior to submittal of this SIP revision and has satisfied these procedural requirements under CAA section 110(l).

    With respect to the substantive requirements of section 110(l), as discussed further below, we have determined that our approval of the ADEQ NSR SIP Submittal and the other rules and statutory provisions that we are proposing to act on in this action (including but not limited to the rescission of numerous existing NSR SIP rules), as described above in this preamble, would strengthen the applicable SIP in most respects. Taken in its entirety, we find that the SIP revision represents a strengthening of ADEQ's minor NSR, PSD, and NA-NSR programs as compared to the existing SIP-approved NSR program for ADEQ that was last substantially revised in the SIP in the early 1980s, and that our approval of this SIP submittal would not interfere with any applicable requirement concerning attainment and reasonable further progress (RFP) or any other applicable requirement of the Act.

    First, this proposed action would correct a number of deficiencies in ADEQ's current SIP-approved NSR program. ADEQ's existing SIP-approved program does not currently contain these significant program elements: (1) Implementation of NSR requirements for PM10; (2) implementation of NSR requirements for PM2.5; (3) regulation of NOX as a precursor to ozone; (4) inclusion of condensable particular matter in NSR permitting for determining PM10 and PM2.5 emissions; and (5) ensuring that the construction or modification of certain non-major sources and non-major modifications will (1) not interfere with attainment or maintenance of the NAAQS and (2) comply with the applicable SIP.

    Further, ADEQ has also updated its program to provide for additional permitting flexibilities that have been added to the federal NSR program, such as PALs and the 2002 NSR Reforms.

    Second, most of the deficiencies identified with the ADEQ rule provisions on which we are taking action fit into one of two categories: (1) Deficiencies that relate to an NSR program element that has been added since ADEQ's NSR program was approved into the SIP (e.g., the deficiency related to the omission of the definition for major emissions unit in the PALs provisions), or (2) deficiencies that exist in the current SIP that were not identified as deficiencies when the provisions were approved into the SIP (e.g., ensuring protection of the NAAQS in areas outside of Arizona from stationary source emissions regulated under the NSR program). Therefore, in considering whether our proposed approval of the NSR SIP submittal will interfere with attainment or reasonable further progress, we only consider those deficiencies in the first category, as the deficiencies in the second category are already a part of the current applicable requirements for attainment and RFP in the Arizona SIP. In many cases, the deficiencies in the second category occurred because of the numerous changes to the NSR program since ADEQ's NSR rules were last approved into the SIP. That is, language that may have been approvable previously is no longer approvable.

    The most significant deficiency that we have identified, as discussed in detail above in this notice, is the absence of provisions that ensure protection of the 2012 PM2.5 NAAQS for the PSD program. This deficiency is the most likely to affect the substantive requirements of the overall application of the PSD program, compared to other deficiencies that we do not expect would significantly affect the review of emission impacts (e.g., administrative requirements for permit issuance). However, the 2012 PM2.5 NAAQS came into effect after ADEQ submitted the NSR SIP submittal to EPA. In addition, although such standard is currently applicable in the context of the PSD program, the implementation requirements for this standard are not due until 2016. Accordingly, there are no applicable requirements in the existing ADEQ SIP-approved NSR program related to this NAAQS that would be affected by the deficiencies in the submitted NSR rules we are approving.

    In addition, ADEQ has relaxed its definition of “major stationary source.” ADEQ's previous definition applied the PSD and NA-NSR program requirements to existing non-major sources when a project would cause such a stationary source to become a “major stationary source.” ADEQ revised its program to instead subject existing non-major sources to the major NSR program only if the project constitutes a “major stationary source” in and of itself, consistent with federal NSR program requirements. We do not find this relaxation to interfere with attainment or reasonable further progress because ADEQ is also strengthening its minor NSR program to address emissions from larger modifications that do not qualify as major modifications under ADEQ's revised NSR program. While these modifications would no longer be subject to the major NSR program, ADEQ's minor NSR program would nonetheless apply and ensure the modification does not interfere with attainment or RFP.

    In summary, we find that, on balance, the improvements ADEQ is making to its NSR program and other portions of the SIP that are the subject of this section outweigh the deficiencies discussed above as compared to ADEQ's existing SIP-approved NSR program. In addition, we are unaware of any reliance by ADEQ on the continuation of any specific aspect of the permit-related rules currently in the ADEQ portion of the Arizona SIP for the purpose of continued attainment or maintenance of the NAAQS. Given all these considerations, we propose to conclude that our approval of the ADEQ regulations and statute that are the subject of this action into the Arizona SIP would not interfere with any applicable requirement concerning attainment and RFP or any other applicable requirement of the Act.27

    27 Our analysis and conclusion here also apply to our approval of R18-2-311 and R18-2-312, which are not generally related to NSR permitting. We note that these rules do not contain any substantive changes in the procedures for performance tests or test methods as compared with the analogous rules in the current SIP. Similarly, our analysis and conclusion here also extends to our approval of A.R.S. § 49-107 into the SIP. The provisions in this state statute relate specifically to local delegation of state authority and thus would not interfere with any applicable requirement concerning attainment and RFP or any other applicable requirement of the Act.

    Conclusion. For the reasons set forth above, we can approve the ADEQ SIP revision as proposed in this action under section 110(l) of the Act.

    Section 193 of the Act, which was added by the CAA Amendments of 1990, includes a savings clause that provides, in pertinent part: “No control requirement in effect, or required to be adopted by an order, settlement agreement, or plan in effect before November 15, 1990, in any area which is a nonattainment area for any air pollutant may be modified after November 15, 1990, in any manner unless the modification insures equivalent or greater emission reductions of such air pollutant.”

    We find that the provisions included in ADEQ's NSR SIP submittal would ensure equivalent or greater emission reductions compared to the SIP-approved NSR program in the nonattainment areas under ADEQ's jurisdiction. In particular, the NSR provisions in ADEQ's NSR SIP submittal cover stationary sources in areas that are nonattainment for the PM10, PM2.5 and 1-hr SO2 NAAQS. ADEQ's current SIP-approved NSR program was approved prior to EPA establishing these NAAQS and the current NSR provisions in the SIP do not reference the current, recently SIP-approved Arizona air quality standards that are comparable to these NAAQS. In addition, ADEQ's updated NSR rules and our action to approve them into the SIP will expand ADEQ's review of minor sources in nonattainment areas to require review of smaller sources. We therefore conclude that ADEQ's NSR SIP submittal will provide for equivalent or greater emissions reductions as compared to the existing SIP-approved ADEQ NSR program for the nonattainment pollutants PM10, PM2.5 and SO2.

    Conclusion. For the reasons set forth above, we can approve the submitted NSR program under section 193 of the Act.

    H. Conclusion

    For the reasons stated above and explained further in our TSD, we find that the submitted NSR rules satisfy most of the applicable CAA and regulatory requirements for minor NSR, PSD, and nonattainment NSR permit programs under CAA section 110(a)(2)(C) and parts C and D of title I of the Act but also contain certain deficiencies that prevent us from proposing a full approval of the NSR SIP submittal. Therefore, we are proposing a limited approval and limited disapproval of the submitted NSR rules. We do so based also on our finding that, while the rules do not meet all of the applicable requirements, the rules would represent an overall strengthening of the SIP by clarifying and enhancing the NSR permitting requirements for major and minor stationary sources under ADEQ's jurisdiction in Arizona. In addition, we are also proposing to remove the existing statutes and rules listed in Table 2 from the SIP, which are outdated and mostly being superseded by our proposed action. As discussed above, we are proposing a partial disapproval of two elements of ADEQ's program, which have been vacated from the PSD program (and is one case also from the NA-NSR program) by the courts. We are also proposing a limited approval of ADEQ's nonattainment NSR program for the Nogales and West Central Pinal PM2.5 nonattainment areas and the West Pinal PM10 nonattainment area under section 189(e) of the Act. Finally, we are proposing a limited approval and limited disapproval of two ADEQ rules relating to test methods and procedures and performance tests, and proposing to approve into the SIP an Arizona statutory provision relating to local delegation of state authority.

    III. Public Comment and Proposed Action

    Pursuant to section 110(k) of the CAA and for the reasons provided above, EPA is proposing a limited approval and limited disapproval of revisions to the ADEQ portion of the Arizona SIP that govern preconstruction review and the issuance of preconstruction permits for stationary sources, including the review and permitting of major sources and major modifications under parts C and D of title I of the CAA. Specifically, EPA is proposing a limited approval and limited disapproval of the new and amended ADEQ regulations listed in Table 1, above, as a revision to the ADEQ portion of the Arizona SIP. We are also proposing to remove the existing statutes and rules listed in Table 2 from the SIP, which are outdated and mostly being superseded by our proposed action. In addition, we are also proposing to partially disapprove two provisions of ADEQ's NSR program that have been vacated by the courts. We are proposing a limited approval of ADEQ's nonattainment NSR program in certain nonattainment areas under section 189 of the Act related to PM10 and PM2.5 precursors. Finally, we are proposing a limited approval and limited disapproval of two ADEQ rules relating to test methods and procedures and performance tests, and proposing to approve into the SIP an Arizona statutory provision relating to local delegation of state authority.

    EPA is proposing this action because, although we find that the new and amended rules meet most of the applicable requirements for such permit programs and that the SIP revisions improve the existing SIP, we have found certain deficiencies that prevent full approval, as explained further in this preamble and in the TSD for this rulemaking. The intended effect of our proposed limited approval and limited disapproval action is to update the applicable SIP with current ADEQ regulations and to set the stage for remedying deficiencies in these regulations.

    If finalized as proposed, our limited disapproval action would trigger an obligation on EPA to promulgate a Federal Implementation Plan unless the State of Arizona corrects the deficiencies, and EPA approves the related plan revisions, within two years of the final action. Additionally, for those deficiencies that relate to the Nonattainment NSR requirements under part D of title I of the Act, the offset sanction in CAA section 179(b)(2) would apply in the ADEQ nonattainment areas 18 months after the effective date of a final limited disapproval, and the highway funding sanctions in CAA section 179(b)(1) would apply in these areas six months after the offset sanction is imposed. Neither sanction will be imposed under the CAA if Arizona submits and we approve, prior to the implementation of the sanctions, SIP revisions that correct the deficiencies that we identify in our final action. The EPA intends to work with ADEQ to correct the deficiencies identified in this action in a timely manner.

    We will accept comments from the public on this proposed action for the next 30 days.

    IV. Incorporation by Reference

    In this rule, the EPA is proposing to include in a final EPA rule regulatory text that includes incorporation by reference. In accordance with requirements of 1 CFR 51.5, the EPA is proposing to incorporate by reference the ADEQ rules and Arizona statutory provisions listed in Table 1 of this preamble. The EPA has made, and will continue to make, these documents generally available electronically through www.regulations.gov and/or in hard copy at the appropriate EPA office (see the ADDRESSES section of this preamble for more information).

    V. Statutory and Executive Order Reviews A. Executive Order 12866: Regulatory Planning and Review and Executive Order 13563: Improving Regulation and Regulatory Review

    This proposed action is not a “significant regulatory action” under the terms of Executive Order 12866 (58 FR 51735, October 4, 1993) and is therefore not subject to review under Executive Orders 12866 and 13563 (76 FR 3821, January 21, 2011).

    B. Paperwork Reduction Act

    This action does not impose an information collection burden under the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. Burden is defined at 5 CFR 1320.3(b).

    C. Regulatory Flexibility Act

    The Regulatory Flexibility Act (RFA) generally requires an agency to conduct a regulatory flexibility analysis of any rule subject to notice and comment rulemaking requirements unless the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. Small entities include small businesses, small not-for-profit enterprises, and small governmental jurisdictions.

    This rule will not have a significant impact on a substantial number of small entities because SIP approvals or disapprovals under section 110 and subchapter I of the Clean Air Act do not create any new requirements but simply approve or disapprove requirements that the State is already imposing. Therefore, because EPA's proposed limited approval/limited disapproval does not create any new requirements, I certify that this action will not have a significant economic impact on a substantial number of small entities.

    Moreover, due to the nature of the Federal-State relationship under the Clean Air Act, preparation of flexibility analysis would constitute Federal inquiry into the economic reasonableness of State action. The Clean Air Act forbids EPA to base its actions concerning SIPs on such grounds. Union Electric Co., v. U.S. EPA, 427 U.S. 246, 255-66 (1976); 42 U.S.C. 7410(a)(2).

    D. Unfunded Mandates Reform Act

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA), 2 U.S.C. 1531-1538, requires Federal agencies, unless otherwise prohibited by law, to assess the effects of their regulatory actions on State, local, and tribal governments and the private sector. Federal agencies must also develop a plan to provide notice to small governments that might be significantly or uniquely affected by any regulatory requirements. The plan must enable officials of affected small governments to have meaningful and timely input in the development of EPA regulatory proposals with significant Federal intergovernmental mandates and must inform, educate, and advise small governments on compliance with the regulatory requirements.

    This proposed rule does not include a Federal mandate that may result in estimated costs of $100 million or more to either State, local, or tribal governments in the aggregate, or to the private sector in any one year. Thus, this rule is not subject to the requirements of section 202 or 205 of UMRA. This Federal action proposes to approve and disapprove pre-existing requirements under State or local law, and imposes no new requirements.

    This proposed rule is also not subject to the requirements of section 203 of UMRA because it contains no regulatory requirements that might significantly or uniquely affect small governments. This proposed rule does not impose regulatory requirements on any government entity.

    E. Executive Order 13132, Federalism

    This action does not have federalism implications. It will not have substantial direct effects on the states, on the relationship between the national government and the states, or in the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132. In the spirit of Executive Order 13132, and consistent with EPA policy to promote communications between EPA and State and local governments, EPA specifically solicits comment on this proposed action from State and local officials.

    F. Executive Order 13175, Coordination With Indian Tribal Governments

    Under Executive Order 13175 (65 FR 67249, November 9, 2000), EPA may not issue a regulation that has tribal implications, that imposes substantial direct compliance costs, and that is not required by statute, unless the federal government provides the funds necessary to pay the direct compliance costs incurred by tribal governments, or EPA consults with tribal officials early in the process of developing the proposed regulation and develops a tribal summary impact statement.

    This proposed rule does not have tribal implications, as specified in Executive Order 13175. Thus, Executive Order 13175 does not apply to this rule. EPA specifically solicits additional comment on this proposed rule from tribal officials. The SIP is not approved to apply on any Indian reservation land or in any other area where EPA or an Indian tribe has demonstrated that a tribe has jurisdiction. In those areas of Indian country, the rule does not have tribal implications and will not impose substantial direct costs on tribal governments or preempt tribal law as specified by Executive Order 13175.

    G. Executive Order 13045, Protection of Children From Environmental Health Risks and Safety Risks

    EPA interprets Executive Order 13045 (62 FR 19885, April 23, 1997) as applying only to those regulatory actions that concern health or safety risks, such that the analysis required under section 5-501 of the Executive Order has the potential to influence the regulation. This rule is not subject to Executive Order 13045, because it proposes to approve a State rule implementing a Federal standard.

    H. Executive Order 13211, Actions That Significantly Affect Energy Supply, Distribution, or Use

    This rule is not subject to Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355, May 22, 2001) because it is not a significant regulatory action under Executive Order 12866.

    I. National Technology Transfer and Advancement Act

    Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (NTTAA), Public Law 104-113, 12 (10) (15 U.S.C. 272 note) directs EPA to use voluntary consensus standards (VCS) in its regulatory activities unless to do so would be inconsistent with applicable law or otherwise impractical. VCS are technical standards (e.g., materials specifications, test methods, sampling procedures, and business practices) that are developed or adopted by the VCS bodies. The NTTAA directs EPA to provide Congress, through annual reports to OMB, with explanations when the Agency decides not to use available and applicable VCS. EPA believes that VCS are inapplicable to this action. Today's action does not require the public to perform activities conducive to the use of VCS.

    J. Executive Order 12898: Federal Actions To Address Environmental Justice in Minority Populations and Low-Income Population

    Executive Order (EO) 12898 (59 FR 7629 (Feb. 16, 1994)) establishes federal executive policy on environmental justice. Its main provision directs federal agencies, to the greatest extent practicable and permitted by law, to make environmental justice part of their mission by identifying and addressing, as appropriate, disproportionately high and adverse human health or environmental effects of their programs, policies, and activities on minority populations and low-income populations in the United States.

    EPA has determined that this proposed rule will not have disproportionately high and adverse human health or environmental effects on minority or low-income populations because it does not change the level of environmental protection for any affected populations.

    Dated: March 4, 2015. Jared Blumenfeld, Regional Administrator, Region IX.
    [FR Doc. 2015-06143 Filed 3-17-15; 8:45 am] BILLING CODE 6560-50-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 52 [EPA-R07-OAR-2015-0123; FRL-9924-54-Region 7] Approval and Promulgation of Implementation Plans; State of Missouri, Construction Permits Required AGENCY:

    Environmental Protection Agency.

    ACTION:

    Proposed rule.

    SUMMARY:

    The Environmental Protection Agency (EPA) is proposing to approve revisions to the State Implementation Plan (SIP) for the State of Missouri submitted on October 2, 2013. This proposed rulemaking will amend the SIP to update the construction permits rule to incorporate by reference recent EPA actions related to plantwide applicability limitations (PALs) for greenhouse gases (GHGs) and to correct the definition of “regulated NSR pollutant.” Other revisions include modifying the notification period for initial equipment start-up and clarifying de minimis permit air quality analysis requirements.

    DATES:

    Comments must be received on or before April 17, 2015.

    ADDRESSES:

    Submit your comments, identified by Docket ID No. EPA-R07-OAR-2015-0123, by one of the following methods:

    1. www.regulations.gov. Follow the on-line instructions for submitting comments.

    2. Email: [email protected]

    3. Mail or Hand Delivery: Paula Higbee, Environmental Protection Agency, Air Planning and Development Branch, 11201 Renner Boulevard, Lenexa, Kansas 66219.

    Instructions: Direct your comments to Docket ID No. EPA-R07-OAR-2015-0123. EPA's policy is that all comments received will be included in the public docket without change and may be made available online at www.regulations.gov, including any personal information provided, unless the comment includes information claimed to be Confidential Business Information (CBI) or other information whose disclosure is restricted by statute. Do not submit through www.regulations.gov or email information that you consider to be CBI or otherwise protected. The www.regulations.gov Web site is an “anonymous access” system, which means EPA will not know your identity or contact information unless you provide it in the body of your comment. If you send an email comment directly to EPA without going through www.regulations.gov, your email address will be automatically captured and included as part of the comment that is placed in the public docket and made available on the Internet. If you submit an electronic comment, EPA recommends that you include your name and other contact information in the body of your comment and with any disk or CD-ROM you submit. If EPA cannot read your comment due to technical difficulties and cannot contact you for clarification, EPA may not be able to consider your comment. Electronic files should avoid the use of special characters, any form of encryption, and be free of any defects or viruses.

    Docket: All documents in the docket are listed in the www.regulations.gov index. Although listed in the index, some information is not publicly available, i.e., CBI or other information whose disclosure is restricted by statute. Certain other material, such as copyrighted material, will be publicly available only in hard copy form. Publicly available docket materials are available either electronically in www.regulations.gov or in hard copy at the Environmental Protection Agency, Air Planning and Development Branch, 11201 Renner Boulevard, Lenexa, Kansas 66219. The Regional Office's official hours of business are Monday through Friday, 8:00 to 4:30 excluding legal holidays. The interested persons wanting to examine these documents should make an appointment with the office at least 24 hours in advance.

    FOR FURTHER INFORMATION CONTACT:

    Paula Higbee, Environmental Protection Agency, Air Planning and Development Branch, 11201 Renner Boulevard, Lenexa, Kansas 66219 at 913-551-7028 or by email at [email protected]

    SUPPLEMENTARY INFORMATION:

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

    I. What is being addressed in this document? II. Background III. Have the requirements for approval of a SIP revision been met? IV. What action is EPA taking? I. What is being addressed in this document?

    EPA is proposing to approve the SIP revision submitted by the state of Missouri for 10 CSR 10-6.060, “Construction Permits Required”. On October 3, 2013, EPA received a request to amend the SIP to incorporate by reference all sections of title 40 part 52.21 of the Code of Federal Regulations (CFR) except for subsections (a), (q) and (s) through July 1, 2012. Missouri is also requesting to amend the SIP to incorporate by reference EPA's July 12, 2012, final rule finalizing PALs for GHGs (77 FR 41051) and EPA's October 25, 2012, final rule amending the definition of “Regulated NSR Pollutant” concerning condensable particulate matter (77 FR 65107). In Missouri's letter to EPA, Missouri also requested to amend the SIP to incorporate EPA's May 18, 2011, rule repealing the grandfathering provisions for particulate matter less than 2.5 micrometers (PM2.5) under the PSD program, but because the state has an already approved PSD program which incorporates by reference the provisions of 40 CFR 52.21 through July 1, 2011, Missouri's Federally approved program already incorporates this action. Other revisions to Missouri's rule which we are proposing to take action on include clarifying the requirements for conducting an air quality analysis in section 5, De Minimis Permits and making minor administrative clarifications as well as revising the notification period for initial start-up in section 6, General Permits.

    II. Background

    Missouri implements its PSD program by incorporating by reference section 52.21 of the CFR in its rule 10 CSR 10-6.060, “Construction Permits Required”. In a previous action on June 21, 2013, EPA approved the most recent amendment to Missouri's PSD program (78 FR 37457). Missouri's currently approved PSD program incorporates by reference (IBR) the Federal regulations as promulgated July 1, 2011, in the CFR, and incorporates the July 20, 2011, rule “Deferral for CO2 Emissions from Bioenergy and Other Biogenic Sources under the Prevention of Significant Deterioration and Title V Programs” (“Biomass Deferral” 76 FR 43490). Missouri's currently approved PSD program contains a number of important required elements, including those related to the 2008 “Implementation of New Source Review (NSR) Program for Particulate Matter Less Than 2.5 Micrometers (PM2.5)” (2008 NSR PM2.5 Rule; 73 FR 28321). For PSD sources in Missouri, PSD permits must address direct PM2.5 emissions as well as precursor emissions (including sulfur dioxide (SO2) and oxides of nitrogen (NOX)), establish significant emission rates for PM2.5 and precursor emissions, and establish the requirement to account for condensable particulate matter. On January 4, 2013, the U.S. Court of Appeals for the District of Columbia Circuit (D.C. Circuit), in Natural Resources Defense Council v. EPA, issued a decision that remanded the EPA's rules implementing the 1997 PM2.5 NAAQS.1 The court's remand of the 2008 NSR PM2.5 Rule is relevant to this final rulemaking. This rule promulgated NSR requirements for implementation of PM2.5 in both nonattainment areas (nonattainment NSR) and attainment/unclassifiable areas (PSD). The D.C. Circuit found that EPA erred in implementing the PM2.5 NAAQS pursuant to the general implementation provisions of subpart 1 of part D of title 1 of the CAA, rather than pursuant to the additional implementation provisions specific to particulate matter nonattainment areas in subpart 4. The Court ordered EPA to “repromulgate these rules pursuant to Subpart 4 consistent with this opinion.” (Id. at 437). However, as the requirements of subpart 4 only pertain to nonattainment areas, it is EPA's position that the portions of the 2008 NSR PM2.5 Rule that address requirements for PM2.5 in attainment and unclassifiable areas are not affected by the D.C. Circuit's opinion in NRDC v. EPA. Moreover, EPA does not anticipate the need to revise any PSD requirements promulgated in the 2008 NSR PM2.5 Rule in order to comply with the court's decision. Accordingly, EPA's approval of Missouri's SIP as to the PSD requirements promulgated by the 2008 NSR PM2.5 Rule does not conflict with the D.C. Circuit's opinion.

    1See 706 F.3d 428 (D.C. Cir. 2013).

    On October 20, 2010, EPA promulgated additional PSD regulations relating to PM2.5: “Prevention of Significant Deterioration (PSD) for Particulate Matter Less than 2.5 Micrometers (PM2.5)—Increments, Significant Impact Levels (SILs), and Significant Monitoring Concentrations (SMC)” (2010 PSD PM2.5 Rule, 73 FR 64864). On January 22, 2013, the D.C. Circuit, in Sierra Club v. EPA, issued a judgment that, inter alia, vacated and remanded the SIL provisions at section 52.21(k)(2). Additionally, the D.C. Circuit vacated the SMC provisions at section 52.21(i)(5)(i)(c).2 In response to the D.C. Circuit's decision, EPA took final action on December 9, 2013, to remove the SIL provisions from the Federal PSD regulations, and to revise the SMC for PM2.5 to zero (78 FR 73698). On March 19, 2013, and October 21, 2013, Missouri submitted additional information to amend their September 5, 2012, SIP submission to clarify that they no longer intended to include the PM2.5 SILs and SMC provisions (see 78 FR 37457, June 21, 2013, for more information). Specifically, Missouri Department of Natural Resources (MDNR) will not apply either the PM2.5 SILs provisions at 40 CFR 51.166(k)(2) and 52.21(k)(2), or the PM2.5 SMC provisions at 40 CFR 51.166(i)(5)(i)(c) to pending or future PSD permit actions. It is the state's intent that PM2.5 will remain on the list of pollutants but that the associated concentration level would be blank or zero. In other words, pre-construction monitoring will continue to apply but without de minimis thresholds. Therefore, the provisions with which the court took issue are not in effect in Missouri.

    2See 705 F.3d 458, 469

    On June 23, 2014, the United States Supreme Court, in Utility Air Regulatory Group v. Environmental Protection Agency, issued a decision addressing the application of PSD permitting requirements to greenhouse gas (GHG) emissions.3 The Supreme Court said that the EPA may not treat GHGs as an air pollutant for purposes of determining whether a source is a major source (or modification thereof) required to obtain a PSD permit. The Court also said that EPA could continue to require that PSD permits, otherwise required based on emissions of pollutants other than GHGs, contain limitations on GHG emissions based on the application of Best Available Control Technology (BACT). In order to act consistently with its understanding of the Court's decision pending further judicial action before the D.C. Circuit to effectuate the decision, the EPA is not continuing to apply EPA regulations that would require that SIPs include permitting requirements that the Supreme Court found impermissible. Specifically, EPA is not applying the requirement that a state's SIP-approved PSD program require that sources obtain PSD permits when GHGs are the only pollutant, (i) that the source emits or has the potential to emit above the major source thesholds, or (ii) for which there is a significant emissions increase and a significant net emissions increase from a modification (e.g. 40 CFR 51.166(b)(48)(v)).

    3 134 S.Ct. 2427.

    EPA anticipates a need to revise Federal PSD rules in light of the Supreme Court opinion. In addition, EPA anticipates that many states will revise their existing SIP-approved PSD programs in light of the Supreme Court's decision. This can be accomplished as soon as EPA revises the Federal PSD rules in states that allow future revisions to the Federal PSD program to be automatically incorporated into the SIP. The timing and content of subsequent EPA actions with respect to the EPA regulations is expected to be informed by additional legal processes before the D.C. Circuit. EPA is not expecting states to have revised their existing PSD program regulations at this juncture, before the D.C. Circuit has addressed these issues and before EPA has revised its regulations at 40 CFR 51.166. However, EPA is evaluating PSD program submissions to assure that the state's program correctly addresses GHGs consistent with the Supreme Court's decision.

    Missouri's existing approved SIP contains the GHG permitting requirements reflected in 40 CFR 52.21 after EPA issued the Tailoring Rule. As a result, the PSD permitting program in Missouri previously approved by EPA into the SIP continues to require that PSD permits (otherwise required based on emissions of pollutants other than GHGs) contain limitations on GHG emissions based on the application of BACT when sources emit or increase greenhouse gases in the amount of 75,000 tons per year (measured as carbon dioxide equivalent). Although the approved Missouri PSD permitting program may also currently contain provisions that are no longer necessary in light of the Supreme Court decision, this does not prevent EPA from approving the submission addressed in this rule. Missouri's 2013 SIP submission does not add any GHG permitting requirements that are inconsistent with the Supreme Court decision. While this submission incorporates all of section 52.21 for completeness, except for subsections (a), (q) and (s), the submission mostly reincorporates PSD permitting requirements for GHG's that are already in the Missouri SIP.

    This proposed revision does add to the Missouri SIP the elements of EPA's July 12, 2012, rulemaking, Prevention of Significant Deterioration and Title V Greenhouse Gas Tailoring Rule Step 3 and GHG Plantwide Applicability Limits, “Step 3 Tailoring Rule” (77 FR 41051), which implements Step 3 of the phase in of PSD permitting requirements for GHGs. This rule became effective on August 13, 2012. Specifically, the incorporation of the Step 3 rule provisions will allow GHG-emitting sources to obtain plantwide applicability limits (PALs) for their GHG-emitting sources on a carbon dioxide equivalent (CO2e) basis. The GHG PAL provisions, as currently written, include some provisions that may no longer be appropriate in light of the Supreme Court decision. Since the Supreme Court has determined that sources and modifications may not be defined as “major” solely on the basis of the level of GHGs emitted or increased, PALs for GHGs may no longer have value in some situations where a source might have triggered PSD based on GHG emissions alone. However, PALs for GHGs may still have a role to play in determining whether a modification that triggers PSD for a pollutant other than GHGs should also be subject to BACT for GHGs. These provisions, like the other GHG provisions discussed previously, will likely be revised pending further legal action. However, these provisions do not add new requirements for sources or modifications that only emit or increase GHGs above the major source threshold or the 75,000 tpy GHG level in section 52.21(b)(49)(iv). Rather, the PALs provisions provide increased flexibility to sources that wish to address their GHG emissions in a PAL. Since this flexibility may still be valuable to sources in at least one context described above, we believe that it is appropriate to approve these provisions into the Missouri SIP at this juncture.

    EPA is proposing to revise Missouri's SIP to incorporate by reference EPA's October 25, 2012 rule, “Implementation of the New Source Review Program for Condensable Particulate Matter”. This revision is appropriate and necessary to ensure that the inadvertent error which was contained in EPA's 2008 rule, which was previously SIP approved in the Missouri rule (78 FR 37457) is corrected. EPA's 2008 rule, “Implementation of the New Source Review (NSR) Program for Particulate Matter Less Than 2.5 Micrometers (PM2.5).” See 73 FR 28321 (May 16, 2008), inadvertently included a requirement to consider condensable PM when measuring one of the emissions-related indicators for PM known as “particulate matter emissions” in the context of the PSD and NSR regulations. EPA's 2012 rule corrects the error in the 2008 rule and therefore it is appropriate and necessary to incorporate by reference the 2012 rule and related corrections to the definition of “particulate matter emissions.”

    III. Have the requirements for approval of a SIP revision been met?

    As stated above, Missouri's incorporation by reference of all sections of title 40 section 52.21 of the CFR except for subsections (a), (q) and (s) and EPA's July 12, 2012, final rule on PALs for GHGs (77 FR 41051) and EPA's October 25, 2012, final rule amending the definition of “Regulated NSR Pollutant” concerning condensable particulate matter (77 FR 65107) are appropriate even in light of recent court actions and ensure that the state PSD program is in agreement with Federal requirements. Missouri also requested to amend the SIP to incorporate EPA's May 18, 2011, rule repealing the grandfathering provisions for PM2.5 under the PSD program, but because the state has an already approved PSD program which incorporates by reference the provisions of 40 CFR 52.21 through July 1, 2011, Missouri's Federally approved program already incorporates this action.

    Additional revisions include, in paragraph (5)(D)(1) of the rule, Missouri is adding subparagraphs A. and B. which provide clear and specific requirements for when an air quality analysis is required for De Minimis permits. In (5)(D)(2) of the rule, Missouri is adding subparagraphs A., B., and C. which provide clear and specific requirements for when the director may require an air quality analysis. These revisions strengthen Missouri's PSD program.

    MDNR is making minor administrative edits to subsections (6)(A) and (6)(A)(2). In (6)(E)(1)(A) Missouri is modifying the notification period for initial equipment start-up. This revision shortens the timeframe for which notification is provided to the state prior to initial start-up.

    The state submission has met the public notice requirements for SIP submissions in accordance with 40 CFR 51.102. The submission also satisfies the completeness criteria of 40 CFR part 51, appendix V. In addition, as explained above, the revision meets the substantive SIP requirements of the CAA, including section 110 and implementing regulations. MDNR received five (5) comments from one source: The U.S. Environmental Protection Agency. Missouri responded to each of the comments and made revisions to the rule as appropriate. Overall, these actions strengthen the Missouri SIP, by ensuring the state PSD program incorporates recent Federal PSD updates. These revisions do not negatively impact air quality, nor relax the SIP.

    IV. What action is EPA taking?

    EPA is proposing to approve the revisions to the SIP. These revisions update the construction permits rule to incorporate by reference recent EPA actions related to PALs for GHGs, and amend the definition of “Regulated NSR Pollutant.” Other revisions include modifying the notification period for initial equipment start-up and clarifying de minimis permit air quality analysis requirements.

    We are processing this rule as a proposed action because we are soliciting comments on this proposed action. Final rulemaking will occur after consideration of any comments.

    Statutory and Executive Order Reviews

    In this rule, EPA is proposing to include in a final EPA rule regulatory text that includes incorporation by reference. In accordance with requirements of 1 CFR 51.5, EPA is proposing to incorporate by reference Missouri 10 CSR 10-6.060 “Construction Permits Required” described in the proposed amendments to 40 CFR part 52 set forth below. EPA has made, and will continue to make, these documents generally available electronically through www.regulations.gov and/or in hard copy at the appropriate EPA office (see the ADDRESSES section of this preamble for more information).

    Under the CAA, the Administrator is required to approve a SIP submission that complies with the provisions of the Act and applicable Federal regulations. 42 U.S.C. 7410(k); 40 CFR 52.02(a). Thus, in reviewing SIP submissions, EPA's role is to approve state choices, provided that they meet the criteria of the CAA. Accordingly, this action merely approves state law as meeting Federal requirements and does not impose additional requirements beyond those imposed by state law. For that reason, this action:

    • Is not a “significant regulatory action” under the terms of Executive Order 12866 (58 FR 51735, October 4, 1993) and is therefore not subject to review under Executive Orders 12866 and 13563 (76 FR 3821, January 21, 2011).

    • does not impose an information collection burden under the provisions of the Paperwork Reduction Act (44 U.S.C. 3501 et seq.);

    • is certified as not having a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.);

    • does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4);

    • does not have Federalism implications as specified in Executive Order 13132 (64 FR 43255, August 10, 1999);

    • is not an economically significant regulatory action based on health or safety risks subject to Executive Order 13045 (62 FR 19885, April 23, 1997);

    • is not a significant regulatory action subject to Executive Order 13211 (66 FR 28355, May 22, 2001);

    • is not subject to requirements of Section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) because application of those requirements would be inconsistent with the CAA; and

    • does not provide EPA with the discretionary authority to address, as appropriate, disproportionate human health or environmental effects, using practicable and legally permissible methods, under Executive Order 12898 (59 FR 7629, February 16, 1994).

    The SIP is not approved to apply on any Indian reservation land or in any other area where EPA or an Indian tribe has demonstrated that a tribe has jurisdiction. In those areas of Indian country, the rule does not have tribal implications and will not impose substantial direct costs on tribal governments or preempt tribal law as specified by Executive Order 13175 (65 FR 67249, November 9, 2000).

    The Congressional Review Act, 5 U.S.C. 801 et seq., as added by the Small Business Regulatory Enforcement Fairness Act of 1996, generally provides that before a rule may take effect, the agency promulgating the rule must submit a rule report, which includes a copy of the rule, to each House of the Congress and to the Comptroller General of the United States. EPA will submit a report containing this action and other required information to the U.S. Senate, the U.S. House of Representatives, and the Comptroller General of the United States prior to publication of the rule in the Federal Register. A major rule cannot take effect until 60 days after it is published in the Federal Register. This action is not a “major rule” as defined by 5 U.S.C. 804(2).

    Under section 307(b)(1) of the CAA, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by May 18, 2015. Filing a petition for reconsideration by the Administrator of this proposed rule does not affect the finality of this rulemaking for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectivess of such future rule or action. This proposed action may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2).)

    List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Carbon monoxide, Incorporation by reference, Intergovernmental relations, Lead, Nitrogen dioxide, Ozone, Particulate matter, Reporting and recordkeeping requirements, Sulfur oxides, Volatile organic compounds.

    Dated: March 9, 2015. Mark Hague, Acting Regional Administrator, Region 7.

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

    1. The authority citation for part 52 continues to read as follows: Authority:

    42 U.S.C. 7401 et. seq.

    Subpart AA—Missouri 2. In § 52.1320 the table in paragraph (c) is amended by revising the entry for 10-6.060 to read as follows:
    § 52.1320 Identification of Plan.

    (c) * * *

    EPA-Approved Missouri Regulations Missouri citation Title State
  • effective
  • date
  • EPA Approval date Explanation
    Missouri Department of Natural Resources *         *         *         *         *         *         * Chapter 6—Air Quality Standards, Definitions, Sampling and Reference Methods and Air Pollution Control Regulations for the Entire State of Missouri 10 CSR 10-6.060 Construction Permits Required 10/30/13 3/18/15 [Insert Federal Register citation] Provisions of the 2010 PM2.5 PSD—Increments, SILs and SMCs rule (75 FR 64865, October 20, 2010) relating to SILs and SMCs that were affected by the January 22, 2013 U.S. Court of Appeals decision are not SIP approved.
  • Provisions of the 2002 NSR reform rule relating to the Clean Unit Exemption and Pollution Control Projects are not SIP approved.
  • In addition, we have not approve Missouri's rule incorporating EPA's 2007 revision fo the definition of “chemical processing plants” (the “Ethanol Rule,” 72 FR 24060 (May 1, 2007).
  • Although exemptions previously listed in 10 CSR 10-6.060 have been transferred to 10 CSR 10-6.061, the Federally-approved SIP continues to include the following exemption, “Livestock and livestock handling systems from which the only potential contaminant is odorous gas.”
  • Section 9, pertaining to hazardous air pollutants, is not SIP approved.
  • *         *         *         *         *         *         *
    [FR Doc. 2015-06153 Filed 3-17-15; 08:45 am] BILLING CODE 6560-50-P
    DEPARTMENT OF COMMERCE National Oceanic and Atmospheric Administration 50 CFR Part 660 [Docket No. 150227200-5200-01] RIN 0648-BE79 Fisheries Off West Coast States; West Coast Salmon Fisheries; Management Reference Point Updates for Three Stocks of Pacific Salmon AGENCY:

    National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.

    ACTION:

    Proposed rule; request for comments.

    SUMMARY:

    NMFS proposes updates to management reference point values for Southern Oregon coastal Chinook salmon, Grays Harbor fall Chinook salmon, and Willapa Bay natural coho, as recommended by the Pacific Fishery Management Council (Council) for use in developing annual management measures beginning in 2015. This update is implemented as part of the 2014 methodology review where the Council and its advisory bodies considered new information on the three stocks of salmon to make a determination on whether changes to reference points for these stocks were warranted.

    DATES:

    Comments on this proposed rule must be received on or before April 2, 2015.

    ADDRESSES:

    You may submit comments, identified by NOAA-NMFS-2015-0014, by any one of the following methods:

    Electronic Submissions: Submit all electronic public comments via the Federal e-Rulemaking Portal. Go to www.regulations.gov/#!docketDetail;D=NOAA-NMFS-2015-0014, click the “Comment Now!” icon, complete the required fields, and enter or attach your comments.

    Mail: William W. Stelle, Jr., Regional Administrator, West Coast Region, NMFS, 7600 Sand Point Way NE., Seattle, WA 98115-0070.

    Instructions: Comments must be submitted by one of the above methods to ensure that the comments are received, documented, and considered by NMFS. Comments sent by any other method, to any other address or individual, or received after the end of the comment period, may not be considered. All comments received are a part of the public record and will generally be posted for public viewing on http://www.regulations.gov without change. All personal identifying information (e.g., name, address, etc.) submitted voluntarily by the sender will be publicly accessible. Do not submit confidential business information or otherwise sensitive or protected information. NMFS will accept anonymous comments (enter N/A in the required fields if you wish to remain anonymous).

    FOR FURTHER INFORMATION CONTACT:

    Peggy Mundy at 206-526-4323.

    SUPPLEMENTARY INFORMATION: Background

    The Council manages West Coast ocean salmon fisheries under the Pacific Coast Salmon Fishery Management Plan (FMP). The FMP has long used stock-specific conservation objectives to manage fishery impacts to Council-managed salmon stocks. Conservation objectives are, generally, fixed quantities intended to provide the necessary guidance during the course of the annual preseason planning process to establish salmon fishing seasons that achieve optimum yield. Under the FMP, conservation objectives can be added or changed either through a plan amendment or notice and comment rulemaking if a comprehensive technical review of the best scientific information available provides evidence that, in the view of the Salmon Technical Team (STT), Scientific and Statistical Committee (SSC), and the Council, justifies a modification (FMP section 3.2.2).

    In 2009, NMFS amended the guidelines for National Standard 1 (NS1) of the Magnuson-Stevens Fishery Conservation and Management Act (MSA) at 50 CFR 600.310 to provide guidance on how to comply with new annual catch limit (ACL) and accountability measure requirements for ending overfishing of fisheries managed by Federal fishery management plans, including status determination criteria (SDC) (74 FR 3204). Amendment 16 to the FMP (76 FR 81851) defined a suite of reference points for salmon, consistent with the revised NS1 guidelines. In the FMP, SDC are defined in terms of quantifiable, biologically-based reference points, or population parameters, including: maximum sustainable yield (MSY), MSY fishing mortality rate (FMSY), MSY spawner abundance (SMSY), minimum stock size threshold (MSST), and maximum fishery mortality threshold (MFMT, generally equal to FMSY). Under the FMP, changes to SDC can be made without a plan amendment if a comprehensive technical review of the best scientific information available provides evidence that, in the view of the STT, SSC, and the Council, a modification of the values of the SDC is justified (FMP section 3.1.7).

    As part of the 2014 methodology review, the Council and its advisory bodies considered new information on three stocks of salmon (Southern Oregon coastal Chinook salmon, Grays Harbor fall Chinook salmon, and Willapa Bay natural coho) to make a determination on whether changes to reference points for these stocks were warranted. A joint methodology review was conducted by the STT, SSC, and the Model Evaluation Workgroup at the Council offices in Portland, OR, October 21-23, 2014. The results of the methodology review were presented at the Council meeting in Costa Mesa, CA, November 12-19, 2014. Both the methodology review and the Council meeting were open to the public and were announced in the Federal Register (79 FR 59741, October 3, 2014 and 79 FR 63900, October 27, 2014). Documents considered by the Council are available on the Council Web site (http://www.pcouncil.org/resources/archives/briefing-books/november-2014-briefing-book/#salmonNov2014). The Council transmitted their recommended changes to NMFS in a letter dated January 23, 2015. This proposed rule describes the reference point updates that are being proposed for implementation in the FMP in developing annual management measures beginning in 2015.

    Southern Oregon Coastal Chinook Salmon

    The Southern Oregon coastal Chinook salmon stock, a component of the Southern Oregon Northern California Chinook stock complex, is an aggregate of natural and hatchery fall and spring Chinook salmon populations in Oregon streams south of the Elk River (e.g., Rogue River, Pistol River, and Chetco River), plus spring Chinook salmon from the Umpqua River. Rogue River fall Chinook are used to indicate relative abundance of Southern Oregon coastal Chinook salmon. The current conservation objective for this stock is 60-90 fish per mile in three standard index areas. At the 2014 methodology review, the Oregon Department of Fish and Wildlife (ODFW) provided an analysis that was used by the State of Oregon in 2013 to adopt new State management objectives for Rogue River fall Chinook. The analysis used a Ricker spawner-recruit relationship for Rogue River fall Chinook that included smolt survival and mean summer flow covariates. ODFW proposed that the Council adopt their conservation objective and reference points for Southern Oregon coastal Chinook salmon in the FMP, while keeping this stock as a component of the Southern Oregon Northern California stock complex (where Klamath River fall Chinook is the indicator stock). ODFW's spawner-recruit analysis resulted in an SMSY point estimate of 34,992 and FMSY of 54 percent. ODFW used the 75th percentile of the SMSY posterior distribution (36,880 natural-area spawners) as an estimate of SMSY to determine an MSST of 18,440 natural-origin spawners (MSST = 0.5 * 36,880). ODFW also proposed a stock conservation objective of 41,000 naturally-produced adults passing Huntley Park in the Rogue River, near Gold Beach, OR.

    The STT and SSC evaluated ODFW's analysis and recommended that the Council adopt ODFW's proposed values as described above. The SSC recommended ODFW's proposed values for SMSY and FMSY but noted that the choice of MSST, above 50 percent of SMSY, was a policy decision. Based on information from the 2014 methodology review and the advisory body recommendations, the Council adopted the following reference point value updates for southern Oregon coastal Chinook salmon and NMFS proposes to implement them:

    • Conservation objective: 41,000 naturally-produced adults passing Huntley Park • SMSY 34,992 natural-area spawners • MFMT (FMSY): 54 percent • MSST: 18,440 (20,500 measured at Huntley Park) natural-origin spawners Grays Harbor Fall Chinook Salmon

    During the 2014 methodology review, Washington Department of Fish and Wildlife (WDFW) staff presented a spawner-recruit analysis for Grays Harbor fall Chinook salmon. The analysis produced an estimated SMSY of 13,326 for the Chehalis and Humptulips Rivers combined (9,753 and 3,573, respectively). This estimate is slightly lower than the current management objective of 14,600 natural-area spawners, which was adopted in 1979 based on available spawning habitat. The new SMSY estimate of 13,326 is currently being used by the Pacific Salmon Commission; adoption by the Council provides consistency between the FMP and the Pacific Salmon Treaty. The STT and SSC agreed that WDFW's estimate of SMSY represents the best available science, and recommended that the Council adopt this estimate of SMSY, and associated reference points developed by the STT, for the salmon FMP.

    Based on information from the 2014 methodology review and the advisory body recommendations, the Council adopted the recommended stock productivity methodology and the resulting SMSY value. However, the Council's action was not explicit with respect to the values for the associated reference points, specifically MSST and MFMT. The Council and NMFS use MSST to determine if a stock is overfished, and MFMT to determine if overfishing is occurring. Because it is necessary to make determinations as to whether the Grays Harbor fall Chinook salmon stock is overfished or experiencing overfishing in preparation for the development of the 2015 management measures, NMFS is proposing to implement values for MSST and MFMT based on the recommendations of the STT, pursuant to NMFS' independent rulemaking authority (18 U.S.C. 1855(d)). Should the Council choose to adopt a different value for MSST or MFMT, NMFS will determine the appropriate process for considering those values. The FMP states that MSST is generally defined as 0.5 * SMSY or 0.75 * SMSY, although there are some exceptions. Currently, MSST for Grays Harbor fall Chinook is MSST = 0.5 * SMSY. Applying the same approach to the proposed SMSY value of 13,326 results in an MSST of 6,663 natural-area spawners. Applying the spawner-recruit parameter estimates from WDFW's analysis, as recommended by the STT as the best available science, yields an MFMT of 63 percent. Therefore, based on the recommendation of the Council and the advisory bodies, NMFS proposes the following reference point value updates for Grays Harbor fall Chinook salmon:

    • Conservation objective: 13,326 spawners (equal to SMSY, per FMP section 3.2.1) • SMSY: 13,326 spawners (9,753 in the Chehalis River and 3,573 in the Humptulips River) • MFMT (FMSY): 63 percent (application of WDFW's spawner-recruit analysis as recommended by the STT) • MSST: 6,663 natural-area spawners (MSST = 0.5 * SMSY) (application of current policy to updated SMSY). Willapa Bay Natural Coho

    The Willapa Bay natural coho salmon stock was added to the FMP under Amendment 16, but without a conservation objective and other reference point values. WDFW's habitat-based escapement goal (i.e., adult salmon escaping the fishery to return to freshwater habitat for spawning) for this stock is 13,090 natural-origin fish. The STT performed a spawner-recruit analysis, which produced an estimated SMSY of 17,200 natural-area spawners, and an FMSY of 74 percent. The STT recommended that the Council adopt reference points for this stock based on this analysis. The STT's recommendation also included an MFMT of 74 percent, a MSST of 8,600 natural-area spawners (MSST = 0.5 * SMSY), and annual catch limit calculated on the basis of FACL = 0.95 * FMSY = 71 percent. The SSC supported these recommendations.

    Based on information from the 2014 methodology review and the advisory body recommendations, the Council adopted the recommended stock productivity methodology and the resulting SMSY and MFMT values. However, the Council's action was not explicit with respect to the value for MSST. The Council and NMFS use MSST to determine if a stock is overfished. Because it is necessary to determine whether the Willapa Bay natural coho stock is overfished, in preparation for the development of the 2015 management measures, NMFS is proposing to implement a value for MSST based on the recommendations of the STT, pursuant to NMFS' independent rulemaking authority (18 U.S.C. 1855(d)). Should the Council choose to adopt a different value for MSST, it should confer with NMFS regarding the appropriate process for addressing this value. As noted above, the FMP states that MSST is generally defined as 0.5 * SMSY or 0.75 * SMSY. The Council has generally applied a policy of MSST = 0.5* SMSY. Applying this approach to the proposed SMSY value of 17,200 results in an MSST of 8,600 natural-area spawners. Therefore, based on the recommendation of the Council and the advisory bodies, NMFS proposes the following reference point values for Willapa Bay natural coho:

    • Conservation objective: 17,200 natural-area spawners (equal to SMSY, per FMP section 3.2.1) • SMSY: 17,200 natural-area spawners • MFMT (FMSY): 74 percent • MSST: 8,600 natural-area spawners (MSST = 0.5 * SMSY)

    In addition, because Willapa Bay natural coho is not managed under an international agreement, listed under the ESA, or designated as a hatchery stock, the FMP requires that it be managed with an ACL (FMP sections 3.3.3 and 3.3.4). Because it is not part of a stock complex, it will be managed using an individual stock ACL. The Council and NMFS will determine the ACL annually, based on annual abundance projections and the appropriate formula set forth in the FMP (FMP section 3.3.4). Because the Council has recommended, and NMFS proposes to adopt, a directly estimated value for FMSY, Willapa Bay natural coho is a Tier 1 stock for purposes of determining the acceptable biological catch (ABC) and the ACL. According to the FMP, for a Tier 1 stock, FABC = FMSY * 0.95, FABC = FACL, and FACL is applied to the projected annual abundance to determine the ACL escapement level for the year (FMP sections 3.3.3 and 3.3.4).

    As noted earlier, the Council is expected to address the reference points for Willapa Bay natural coho salmon that were not explicit in its prior action at its March meeting. It is possible that it could recommend values for MSST that are different from those proposed above. Were this to occur, the recommended values would likely be 0.75 * SMSY or between that value and 0.5 * SMSY, based on the definition of MSST set forth in the FMP.

    Classification

    Pursuant to section 304(b)(1)(A) of the MSA, the NMFS Assistant Administrator has determined that this proposed rule is consistent with the Pacific Salmon Fishery Management Plan, the MSA, and other applicable law, subject to further consideration after public comment. As described above, NMFS is proposing portions of this rule according to section 305(d) of the MSA.

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

    The West Coast Regional Administrator has determined that the actions of this proposed rule qualify for categorical exclusion from further NEPA analysis under NAO 216-6.

    The Chief Counsel for Regulation of the Department of Commerce certified to the Chief Counsel for Advocacy of the Small Business Administration that this proposed rule, if adopted, would not have a significant economic impact on a substantial number of small entities.

    The purpose of the Regulatory Flexibility Act (RFA) is to relieve small businesses, small organizations, and small governmental entities of burdensome regulations and record-keeping requirements. Major goals of the RFA are: (1) To increase agency awareness and understanding of the impact of their regulations on small business, (2) to require agencies communicate and explain their findings to the public, and (3) to encourage agencies to use flexibility and to provide regulatory relief to small entities. The RFA emphasizes predicting impacts on small entities as a group distinct from other entities and the consideration of alternatives that may minimize the impacts while still achieving the stated objective of the action. An initial regulatory flexibility analysis (IRFA) is conducted unless it is determined that an action will not have a “significant economic impact on a substantial number of small entities.”

    The objective of this proposed rule is to update management reference points for three stocks of salmon under the FMP. This proposed rule would impact vessels harvesting salmon from the ocean troll fishery. The following fishery information is found in the Council's Review of 2013 Ocean Salmon Fisheries Stock Assessment and Fisheries Evaluation Document. In 2013, there were 2,270 permits issued for this fishery, with a total ex-vessel value of $34.1 million. Of the 2,270 permits, only 1,177 actually landed salmon all within the states of California, Oregon and Washington. In California, 670 vessels landed salmon for an ex-vessel value of $23.6 million; in Oregon, 399 vessels landed salmon for an ex-vessel value of $7.6 million; and in Washington, 108 vessels landed salmon for an ex-vessel value of $2.8 million. Treaty Indian ocean fisheries landed salmon with an ex-vessel value of $6.4 million.

    On June 12, 2014, the Small Business Administration (SBA) issued an interim final rule revising the small business size standards for several industries effective July 14, 2014 (79 FR 33467 (June 12, 2014)). The rule increased the size standard from $19.0 to $20.5 million for finfish fishing, from $5 to $5.5 million for shellfish fishing, and from $7.0 million to $7.5 million for other marine fishing, for-hire businesses, and marinas. Based on this size standard, all 1,177 vessels that landed salmon from the ocean troll fishery are considered small under the Small Business Administration approved definition of a small fish harvester. Therefore, there are no disproportionate impacts between small and large vessels. Furthermore, there are no disproportionate impacts based on homeport, gear type, or vessel size from the promulgation of this proposed rule.

    This proposed rule would not result in any immediate impacts on revenues or costs for the small entities participating in the Pacific salmon fishery; the updated management reference point values will be considered within the overall suite of criteria that are used to frame the annual management measures. The management reference points are used to set Council management goals, identify when overfishing is occurring, and identify when a stock is overfished. These values all have the potential to impact how annual salmon management measures are structured, specifically what constraints are needed to manage impacts. However, the salmon fishery impacts a large number of stocks, and the fishery as a whole must be managed to meet management goals for every stock. Depending on abundance projections for a given year, meeting management goals for a few particularly limiting stocks typically results in fisheries that are not limited by management goals for the remaining stocks. Therefore, the proposed changes would only impact fishery revenues in years when any of the three affected salmon stocks are constraining to fisheries, which is unlikely based on historical data.

    As a result, an IRFA is not required and none has been prepared. NMFS will conduct the appropriate analyses for any subsequent rulemakings stemming from this proposed rule.

    This proposed rule would not establish any new reporting or recordkeeping requirements. This proposed rule does not include a collection of information. No Federal rules have been identified that duplicate, overlap, or conflict with this action.

    This action is not expected to have adverse effects on any species listed under the Endangered Species Act (ESA) or designated critical habitat. This action modifies reference points used in the setting of annual management measures for West Coast salmon fisheries. NMFS has current ESA biological opinions that cover fishing under annual regulations adopted under the FMP on all listed salmon species. NMFS reiterates their consultation standards for all ESA-listed salmon and steelhead species in their annual Guidance letter to the Council. Some of NMFS past biological opinions have found no jeopardy, and others have found jeopardy, but provided reasonable and prudent alternatives to avoid jeopardy. The annual management measures are designed to be consistent with the biological opinions that found no jeopardy, and with the reasonable and prudent alternatives in the jeopardy biological opinions. The Council's recommended management measures, which will be consistent with the reference points proposed here, therefore comply with NMFS' consultation standards and guidance for all listed salmon species which may be affected by Council fisheries. In some cases, the recommended measures are more restrictive than NMFS' ESA requirements.

    In 2009, NMFS consulted on the effects of fishing under the Salmon FMP on the endangered Southern Resident Killer Whale Distinct Population Segment (SRKW) and concluded the salmon fisheries were not likely to jeopardize SRKW. Annual salmon management measures are designed to be consistent with the terms of that biological opinion.

    This proposed rule was developed after meaningful collaboration with the affected tribes, through the Council process. Under the MSA at 16 U.S.C. 1852(b)(5), one of the voting members of the Council must be a representative of an Indian Tribe with Federally recognized fishing rights from the area of the Council's jurisdiction.

    Authority:

    16 U.S.C. 1801 et seq.

    Dated: March 12, 2015. Samuel D. Rauch III, Deputy Assistant Administrator for Regulatory Programs, National Marine Fisheries Service.
    [FR Doc. 2015-06144 Filed 3-17-15; 8:45 am] BILLING CODE 3510-22-P
    80 52 Wednesday, March 18, 2015 Notices DEPARTMENT OF AGRICULTURE National Agricultural Statistics Service Notice of Meeting of Expert Panel on Federal Statistics on Women and Beginning Farmers in U.S. Agriculture AGENCY:

    National Agricultural Statistics Service, USDA.

    ACTION:

    Notice of public meeting.

    SUMMARY:

    The National Agricultural Statistics Service (NASS) announces a meeting of an Expert Panel on Federal Statistics on Women and Beginning Farmers in U.S. Agriculture.

    DATES:

    The Panel meeting will be held from 9 a.m. to 5 p.m. on Thursday April 2 and from 9 a.m. to 5 p.m. Friday April 3, 2015. A public comment period will commence at 9:15 a.m. on April 2, 2015.

    ADDRESSES:

    The Panel meeting will take place in U.S. Department of Agriculture, National Agricultural Statistics Service, 1400 Independence Avenue SW., Room 6309, South Building, Washington, DC 20250. Written comments may be filed before or up to two weeks after the meeting with the contact person identified herein at: U.S. Department of Agriculture, National Agricultural Statistics Service, 1400 Independence Avenue SW., Room 5029, South Building, Washington, DC 20250-2001.

    FOR FURTHER INFORMATION CONTACT:

    Linda J. Young, Director, Research and Development Division, telephone 800-727-9540, Fax: 202-690-2090, or email: [email protected] General information about NASS can also be found at http://www.nass.usda.gov/About_NASS/index.asp.

    SUPPLEMENTARY INFORMATION:

    NASS will be convening a panel of subject matter experts covering a broad range of expertise and interests on April 2 and 3. During this meeting, the panel will consider statements provided by the public on data needs for women and beginning farmers and ranchers, discuss the currently available data on women and beginning farmers and ranchers, and consider additional stakeholder data needs in this area. The panel meeting is open to the public on Thursday April 2. The public is asked to preregister for the meeting at least 5 business days prior to the meeting. Your pre-registration must state the names of each person in your group, organization, or interest represented; the number of people planning to give oral comments, if any; and whether anyone in your group requires special accommodations. Submit registrations to [email protected] or USDA/NASS, 1400 Independence Avenue SW., Room 6035, South Building, Washington, DC 20250-2001. Members of the public who request to give oral comments to the Panel must arrive at the meeting site by 8:45 a.m. on Thursday April 2, 2015. Oral comments should each be limited to three minutes or less. Two hours have been allotted for public comments. Written comments by attendees or other interested stakeholders will be welcomed for the public record before and up to two weeks following the meeting. Comments should be limited to 500 words or less. The public may file written comments by mail to USDA/NASS, Room 6035, 1400 Independence Avenue SW., South Building, Washington, DC 20250-2001.

    Written comments can also be sent via Fax: 202-690-2090, or email: to [email protected] All comments and pre-registrations need to reference “Expert Panel on Federal Statistics on Women and Beginning Farmers in U.S. Agriculture.”

    All statements will become a part of the official records of the Panel meeting and will be kept on file for public review in the office of the Director, Research and Development Division.

    Signed at Washington, DC, March 12, 2015. Joseph T. Reilly, Administrator, National Agricultural Statistics Service.
    [FR Doc. 2015-06181 Filed 3-17-15; 8:45 am] BILLING CODE 3410-20-P
    DEPARTMENT OF AGRICULTURE Submission for OMB Review; Comment Request March 12, 2015.

    The Department of Agriculture has submitted the following information collection requirement(s) to OMB for review and clearance under the Paperwork Reduction Act of 1995, Public Law 104-13. Comments regarding (a) whether the collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility; (b) the accuracy of the agency's estimate of burden including the validity of the methodology and assumptions used; (c) ways to enhance the quality, utility and clarity of the information to be collected; (d) ways to minimize the burden of the collection of information on those who are to respond, including through the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology should be addressed to: Desk Officer for Agriculture, Office of Information and Regulatory Affairs, Office of Management and Budget (OMB), [email protected] or fax (202) 395-5806 and to Departmental Clearance Office, USDA, OCIO, Mail Stop 7602, Washington, DC 20250-7602. Comments regarding these information collections are best assured of having their full effect if received within 30 days of this notification. Copies of the submission(s) may be obtained by calling (202) 720-8958.

    An agency may not conduct or sponsor a collection of information unless the collection of information displays a currently valid OMB control number and the agency informs potential persons who are to respond to the collection of information that such persons are not required to respond to the collection of information unless it displays a currently valid OMB control number.

    Foreign Agricultural Service

    Title: Sugar Imported for Exports as Refined Sugar, as a Sugar-Containing Product, or Used in Production of Certain Polyhydric Alcohols.

    OMB Control Number: 0551-0015.

    Summary of Collection: The regulation at 7 CFR part 1530 authorizes the Foreign Agricultural Service (FAS) to issue import licenses to enter raw cane sugar exempt from the tariff-rate quota (TRQ) for the raw cane sugar imports and related requirements on the condition that an equivalent quantity of refined sugar be: (1) Exported as refined sugar; (2) exported as an ingredient in sugar containing products; or (3) used in production of certain polyhydric alcohols. The information requirements set forth in the regulation are necessary to enable FAS to administer the licensing program in full compliance with the regulation and to ensure that licensed imports do not enter the commercial sugar market in circumvention of the TRQ for raw cane sugar.

    Need and Use of the Information: FAS will collect information to verify that the world-priced sugar is actually exported and not diverted onto the domestic market, thereby undermining the objectives of politically sensitive U.S. sugar policies. This collection enables USDA to monitor participants in an effort to ensure compliance with program parameters. Without the collection, there would be increased opportunity to divert sugar onto the domestic market..

    Description of Respondents: Business or other for-profit.

    Number of Respondents: 172.

    Frequency of Responses: Recordkeeping; Reporting; Quarterly.

    Total Burden Hours: 481.

    Foreign Agricultural Service

    Title: Certificate to Import Specialty Sugars under the Tariff-Rate Quota for Refined Sugar.

    OMB Control Number: 0551-0025.

    Summary of Collection: The collect of information is necessary to fulfill the legal obligations of the regulation at 15 CFR part 2011 subpart B to issue specialty sugar certificates, letters to importers signed by the Foreign Agricultural Service (FAS) Certifying Authority, and ensuring that U.S. importers comply with the program's requirements. The regulation sets forth the terms and conditions under which the Certifying Authority in FAS issues certificates to importers allowing them to enter specialty sugars under the tariff-rate quota (TRQ) for refined sugar.

    Need and Use of the Information: The collected information will be used to: (1) Determine whether applicants for the program meet the regulation's eligibility criteria; (2) ensure that sugar to be imported is specialty sugar and meets the requirements of the regulation; (3) audit participants' compliance with the regulation; and (4) prevent entry of world-priced program sugar from entering the domestic commercial market instead of domestic specialty sugar market. The Certifying Authority needs the information to manage, plan, evaluate, and account for program activities. Less frequent collection or no collection would impede administration of the specialty sugar certificate program and reduce or eliminate imports essential to U.S. organic food and beverages processors.

    Description of Respondents: Business or other for-profit.

    Number of Respondents: 53.

    Frequency of Responses: Reporting: Annually.

    Total Burden Hours: 58.

    Ruth Brown, Departmental Information Collection Clearance Officer.
    [FR Doc. 2015-06195 Filed 3-17-15; 8:45 am] BILLING CODE 3410-10-P
    DEPARTMENT OF AGRICULTURE Forest Service Notice of Proposed Fee Increase; Federal Lands Recreation Enhancement Act, (Title VIII, Pub. L. 108-447) AGENCY:

    Ashley National Forest, USDA Forest Service.

    ACTION:

    Notice of Proposed Fee Increase.

    SUMMARY:

    The Ashley National Forest is proposing to increase the fee for Christmas tree permits from $10.00 to $15.00 per tag. This increase is proposed and will be determined upon further analysis and public comment. Funds from fees would be used for the continued operation of the Christmas tree program, including visitor services, maps, and law enforcement.

    DATES:

    Comments will be accepted through May 30, 2015. Increased fees would begin November 2015.

    ADDRESSES:

    Send comments to: Lesley Tullis, Environmental Coordinator, Ashley National Forest, 355 North Vernal Avenue, Vernal, Utah 84078 (email [email protected]; please put “Christmas trees” in the subject line).

    FOR FURTHER INFORMATION CONTACT:

    Louis Haynes, Public Affairs Officer, at 435-789-1181. Information about proposed fee changes can also be found on the Ashley National Forest Web site: http://www.fs.usda.gov/ashley.

    SUPPLEMENTARY INFORMATION:

    The Federal Recreation Lands Enhancement Act (Title VII, Pub. L. 108-447) directed the Secretary of Agriculture to publish a six month advance notice in the Federal Register whenever new recreation fee areas are established.

    Once public involvement is complete, the fee increases will be reviewed by a Recreation Resource Advisory Committee prior to a final decision and implementation.

    Dated: February 24, 2015. John R. Erickson, Forest Supervisor.
    [FR Doc. 2015-06156 Filed 3-17-15; 8:45 am] BILLING CODE 3410-11-P
    COMMISSION ON CIVIL RIGHTS Notice of Public Meeting of the Missouri Advisory Committee for a Meeting To Discuss Matters Related To Its Project on Police—Community Relations in Missouri AGENCY:

    U.S. Commission on Civil Rights.

    ACTION:

    Notice of meeting.

    SUMMARY:

    Notice is hereby given, pursuant to the provisions of the rules and regulations of the U.S. Commission on Civil Rights (Commission) and the Federal Advisory Committee Act that the Missouri Advisory Committee (Committee) will hold a meeting on Friday, March 27, 2015, at 12 p.m. until 1 p.m. The purpose of the meeting is to discuss and vote on an advisory memorandum to the Commission based on testimony heard at the February 23, 2015, meeting in St. Louis; discuss the advisory committee survey regarding the February 23 meeting; and begin discussions on the logistics and agenda for the upcoming Kansas City meeting.

    Members of the public can listen to the discussion. This meeting is available to the public through the following toll-free call-in number: 888-539-3696, conference ID: 6375577. Any interested member of the public may call this number and listen to the meeting. Callers can expect to incur charges for calls they initiate over wireless lines, and the Commission will not refund any incurred charges. Callers will incur no charge for calls they initiate over land-line connections to the toll-free telephone number. Persons with hearing impairments may also follow the proceedings by first calling the Federal Relay Service at 1-800-977-8339 and providing the Service with the conference call number and conference ID number.

    Member of the public are also entitled to submit written comments; the comments must be received in the regional office by March 27, 2015. Written comments may be mailed to the Midwestern Regional Office, U.S. Commission on Civil Rights, 55 W. Monroe St., Suite 410, Chicago, IL 60615. They may also be faxed to the Commission at (312) 353-8324, or emailed to Carolyn Allen at [email protected] Persons who desire additional information may contact the Midwestern Regional Office at (312) 353-8311.

    Records generated from this meeting may be inspected and reproduced at the Midwestern Regional Office, as they become available, both before and after the meeting. Records of the meeting will be available via www.facadatabase.gov under the Commission on Civil Rights, Missouri Advisory Committee link. Persons interested in the work of this Committee are directed to the Commission's Web site, http://www.usccr.gov, or may contact the Midwestern Regional Office at the above email or street address.

    Agenda Welcome 12 p.m. to 12:05 p.m.
    S. David Mitchell, Chairman, Missouri Advisory Committee Discussion and vote on advisory memorandum 12:05 p.m. to 12:30 p.m. Discussion of advisory committee survey 12:30 p.m. to 12:45 p.m. Planning for Kansas City meeting 12:45 p.m. to 1 p.m. Adjournment 1 p.m. DATES:

    The meeting will be held on Friday, March 27, 2015, at 12 p.m. CST.

    Public Call Information:

    Dial: 888-539-3696.

    Conference ID: 6375577.

    Exceptional Circumstance: Pursuant to 41 CFR 102-3.150, the notice for this meeting is given less than 15 calendar days prior to the meeting because of the exceptional circumstances of technical difficulties occurring in the process of having the meeting notice signed and sent to the Federal Register.

    Dated: March 13, 2015. David Mussatt, Chief, Regional Programs Unit.
    [FR Doc. 2015-06201 Filed 3-17-15; 8:45 am] BILLING CODE 6335-01-P
    DEPARTMENT OF COMMERCE National Oceanic and Atmospheric Administration Submission for OMB Review; Comment Request

    The Department of Commerce will submit to the Office of Management and Budget (OMB) for clearance the following proposal for collection of information under the provisions of the Paperwork Reduction Act (44 U.S.C. Chapter 35).

    Agency: National Oceanic and Atmospheric Administration (NOAA).

    Title: Mariner Opinions of the Right Whale Mandatory Ship Reporting System.

    OMB Control Number: 0648-xxxx.

    Form Number(s): None.

    Type of Request: Regular (request for a new information collection).

    Number of Respondents:

    Average Hours per Response:

    Burden Hours:

    Needs and Uses: This request is for a new information collection.

    The North Atlantic right whale (Eubalaena glacialis) is an endangered marine mammal found primarily in waters off the northeastern coast of the United States to Canada. Fatal collisions with large ships are the primary threat to the recovery of this species. In 1998 the United States proposed to the International Maritime Organization (IMO) the establishment of two Mandatory Ship Reporting (MSR) systems in key right whale habitat areas. Under the proposed MSR all vessels 300 gross tons or greater are required to send a message to a shore-based station when entering either of two prescribed habitat areas. The IMO endorsed the proposal and the MSR systems were established in July 1999. Each reporting ship is required to provide vessel name, call sign, course, speed, location, destination, and route (e.g., waypoints). An automatically-generated message is sent directly to the reporting vessel that includes information on right whale locations and procedural guidance to help prevent vessel/whale collisions; mariners are also informed about additional regulations established to protect whales from vessel strikes. The two-way exchange is mediated by satellite-linked communications systems.

    Although the program has been in effect for over 15 years, the U.S. Government has not assessed the role, if any, that the MSR has in reducing ship collisions with right whales. In addition, mariners have not been polled to assess possible difficulties involved in the reporting itself. The goal of this information collection is to determine if (a) the reporting procedures are adequately clear to the mariner; (b) the reporting itself is onerous or unwieldy (e.g., it may interfere with other vessel operations); and (c) mariners use the information being sent to them and if so, how it is used to avoid collisions with North Atlantic right whales.

    Affected Public: Individuals or households.

    Frequency: One time.

    Respondent's Obligation: Voluntary.

    This information collection request may be viewed at reginfo.gov. Follow the instructions to view Department of Commerce collections currently under review by OMB.

    Written comments and recommendations for the proposed information collection should be sent within 30 days of publication of this notice to [email protected] or fax to (202) 395-5806.

    Sarah Brabson, NOAA PRA Clearance Officer.
    [FR Doc. 2015-06219 Filed 3-17-15; 8:45 am] BILLING CODE 3510-22-P
    DEPARTMENT OF COMMERCE Economic Development Administration Proposed Information Collection; Comment Request; Award Amendment Requests and Project Service Maps AGENCY:

    Economic Development Administration, Commerce.

    ACTION:

    Notice.

    SUMMARY:

    The Department of Commerce, as part of its continuing effort to reduce paperwork and respondent burden, invites the general public and other Federal agencies to take this opportunity to comment on proposed and/or continuing information collections, as required by the Paperwork Reduction Act of 1995.

    DATES:

    Written comments must be submitted on or before May 18, 2015.

    ADDRESSES:

    Direct all written comments to Jennifer Jessup, Departmental Paperwork Clearance Officer, Department of Commerce, Room 6616, 14th and Constitution Avenue NW., Washington, DC 20230 (or via the Internet at [email protected]).

    FOR FURTHER INFORMATION CONTACT:

    Requests for additional information or copies of the information collection instrument and instructions should be directed to: Philip Saputo, Program Analyst, U.S. Department of Commerce, Economic Development Administration Performance and National Programs Division, 1401 Constitution Avenue NW., Suite 71030, Washington, DC 20230, Phone: 202-400-0662, Email: [email protected]

    SUPPLEMENTARY INFORMATION:

    I. Abstract

    The mission of the Economic Development Administration (EDA) is to lead the Federal economic agenda by promoting innovation and competitiveness, preparing American regions for growth and success in the worldwide economy. In order to effectively administer and monitor its economic development assistance programs, EDA collects certain information from applications for, and recipients of, EDA investment assistance.

    A recipient must submit a written request to EDA to amend an investment award and provide such information and documentation as EDA deems necessary to determine the merit of altering the terms of an award (see 13 CFR 302.7(a) of EDA's regulations). EDA may require a recipient to submit a project service map and information from which to determine whether services are provided to all segments of the region being assisted (see CFR 302.16(c) of EDA's regulations).

    II. Method of Collection

    Paper report.

    III. Data

    OMB Control Number: 0610-0102.

    Form Number(s): None.

    Type of Review: Regular submission (extension of a currently approved information collection).

    Affected Public: Current recipients of EDA construction (Public Works or Economic Adjustment) assistance, to include (1) cities or other political subdivisions of a state, including a special purpose unit of state or local government engaged in economic or infrastructure development activities, or a consortium of political subdivisions; (2) states; (3) institutions of higher education or a consortium of institutions of higher education; (4) public or private non-profit organizations or associations; (5) District Organizations; and (6) Indian Tribes or a consortia of Indian Tribes and (7) (for training, research, and technical assistance awards only) individuals and for-profit businesses.

    Estimated Number of Annual Responses: 632 (600 requests for amendments to construction awards, 30 requests for amendments to non-construction awards, 2 project service maps).

    Estimated Time per Response: 2 hours for an amendment to a construction award, 1 hour for an amendment to a non-construction award, 6 hours for a project service map.

    Estimated Total Annual Burden Hours: 1,242.

    Estimated Total Annual Cost: $0.

    IV. Request for Comments

    Comments are invited on: (a) Whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information shall have practical utility; (b) the accuracy of the agency's estimate of the burden (including hours and cost) of the proposed collection of information; (c) ways to enhance the quality, utility, and clarity of the information to be collected; and (d) ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques or other forms of information technology.

    Comments submitted in response to this notice will be summarized and/or included in the request for OMB approval of this information collection; they also will become a matter of public record.

    Dated: March 13, 2015. Glenna Mickelson, Management Analyst, Office of the Chief Information Officer.
    [FR Doc. 2015-06191 Filed 3-17-15; 8:45 am] BILLING CODE 3510-24-P
    DEPARTMENT OF COMMERCE National Oceanic and Atmospheric Administration RIN 0648-XD810 Takes of Marine Mammals Incidental to Specified Activities; Taking Marine Mammals Incidental to Russian River Estuary Management Activities AGENCY:

    National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.

    ACTION:

    Notice; proposed incidental harassment authorization; request for comments.

    SUMMARY:

    NMFS has received a request from the Sonoma County Water Agency (SCWA) for authorization to take marine mammals incidental to Russian River estuary management activities. Pursuant to the Marine Mammal Protection Act (MMPA), NMFS is requesting comments on its proposal to issue an incidental harassment authorization (IHA) to SCWA to incidentally take marine mammals, by Level B harassment only, during the specified activity.

    DATES:

    Comments and information must be received no later than April 17, 2015.

    ADDRESSES:

    Comments on the application should be addressed to Jolie Harrison, Supervisor, Incidental Take Program, Permits and Conservation Division, Office of Protected Resources, National Marine Fisheries Service. Physical comments should be sent to 1315 East-West Highway, Silver Spring, MD 20910 and electronic comments should be sent to [email protected]

    Instructions: NMFS is not responsible for comments sent by any other method, to any other address or individual, or received after the end of the comment period. Comments received electronically, including all attachments, must not exceed a 25-megabyte file size. Attachments to electronic comments will be accepted in Microsoft Word or Excel or Adobe PDF file formats only. All comments received are a part of the public record and will generally be posted to the Internet at www.nmfs.noaa.gov/pr/permits/incidental/construction.htm without change. All personal identifying information (e.g., name, address) voluntarily submitted by the commenter may be publicly accessible. Do not submit confidential business information or otherwise sensitive or protected information.

    FOR FURTHER INFORMATION CONTACT:

    Ben Laws, Office of Protected Resources, NMFS, (301) 427-8401.

    SUPPLEMENTARY INFORMATION: Availability

    An electronic copy of SCWA's application and supporting documents, as well as a list of the references cited in this document, may be obtained by visiting the Internet at: www.nmfs.noaa.gov/pr/permits/incidental.htm. In case of problems accessing these documents, please call the contact listed above (see FOR FURTHER INFORMATION CONTACT).

    National Environmental Policy Act (NEPA)

    NMFS has prepared an Environmental Assessment (EA; 2010) and associated Finding of No Significant Impact (FONSI) in accordance with NEPA and the regulations published by the Council on Environmental Quality. These documents are posted at the aforementioned Internet address. Information in SCWA's application, NMFS' EA (2010), and this notice collectively provide the environmental information related to proposed issuance of this IHA for public review and comment. We will review all comments submitted in response to this notice as we complete the NEPA process, including a decision of whether to reaffirm the existing FONSI, prior to a final decision on the incidental take authorization request.

    Background

    Sections 101(a)(5)(A) and (D) of the MMPA (16 U.S.C. 1361 et seq.) direct the Secretary of Commerce to allow, upon request by U.S. citizens who engage in a specified activity (other than commercial fishing) within a specified area, the incidental, but not intentional, taking of small numbers of marine mammals, providing that certain findings are made and the necessary prescriptions are established.

    The incidental taking of small numbers of marine mammals may be allowed only if NMFS (through authority delegated by the Secretary) finds that the total taking by the specified activity during the specified time period will (i) have a negligible impact on the species or stock(s) and (ii) not have an unmitigable adverse impact on the availability of the species or stock(s) for subsistence uses (where relevant). Further, the permissible methods of taking and requirements pertaining to the mitigation, monitoring and reporting of such taking must be set forth.

    The allowance of such incidental taking under section 101(a)(5)(A), by harassment, serious injury, death, or a combination thereof, requires that regulations be established. Subsequently, a Letter of Authorization may be issued pursuant to the prescriptions established in such regulations, providing that the level of taking will be consistent with the findings made for the total taking allowable under the specific regulations. Under section 101(a)(5)(D), NMFS may authorize such incidental taking by harassment only, for periods of not more than one year, pursuant to requirements and conditions contained within an IHA. The establishment of these prescriptions requires notice and opportunity for public comment.

    NMFS has defined “negligible impact” in 50 CFR 216.103 as “. . . an impact resulting from the specified activity that cannot be reasonably expected to, and is not reasonably likely to, adversely affect the species or stock through effects on annual rates of recruitment or survival.” Except with respect to certain activities not pertinent here, section 3(18) of the MMPA defines “harassment” as: “. . . any act of pursuit, torment, or annoyance which (i) has the potential to injure a marine mammal or marine mammal stock in the wild [Level A harassment]; or (ii) has the potential to disturb a marine mammal or marine mammal stock in the wild by causing disruption of behavioral patterns, including, but not limited to, migration, breathing, nursing, breeding, feeding, or sheltering [Level B harassment].”

    Summary of Request

    On January 21, 2015, we received an adequate and complete request from SCWA for authorization of the taking of marine mammals incidental to Russian River estuary management activities in Sonoma County, California. SCWA proposes to manage the naturally-formed barrier beach at the mouth of the Russian River in order to minimize potential for flooding adjacent to the estuary and to enhance habitat for juvenile salmonids, as well as to conduct biological and physical monitoring of the barrier beach and estuary. Flood control-related breaching of barrier beach at the mouth of the river may include artificial breaches, as well as construction and maintenance of a lagoon outlet channel. The latter activity, an alternative management technique conducted to mitigate impacts of flood control on rearing habitat for Endangered Species Act (ESA)-listed salmonids, occurs only from May 15 through October 15 (hereafter, the “lagoon management period”). Artificial breaching and monitoring activities may occur at any time during the one-year period of validity of the proposed IHA.

    Breaching of naturally-formed barrier beach at the mouth of the Russian River requires the use of heavy equipment (e.g., bulldozer, excavator) and increased human presence, and monitoring in the estuary requires the use of small boats. As a result, pinnipeds hauled out on the beach or at peripheral haul-outs in the estuary may exhibit behavioral responses that indicate incidental take by Level B harassment under the MMPA. Species known from the haul-out at the mouth of the Russian River or from peripheral haul-outs, and therefore anticipated to be taken incidental to the specified activity, include the harbor seal (Phoca vitulina richardii), California sea lion (Zalophus californianus), and northern elephant seal (Mirounga angustirostris).

    This would be the sixth such IHA, if issued. SCWA was first issued an IHA, valid for a period of one year, effective on April 1, 2010 (75 FR 17382), and was subsequently issued one-year IHAs for incidental take associated with the same activities, effective on April 21, 2011 (76 FR 23306), April 21, 2012 (77 FR 24471), April 21, 2013 (78 FR 23746), and April 21, 2014 (79 FR 20180).

    Description of the Specified Activity Overview

    The proposed action involves management of the estuary to prevent flooding while preventing adverse modification to critical habitat for ESA-listed salmonids. Requirements related to the ESA are described in further detail below. During the lagoon management period, this involves construction and maintenance of a lagoon outlet channel that would facilitate formation of a perched lagoon. A perched lagoon, which is an estuary closed to tidal influence in which water surface elevation is above mean high tide, would reduce flooding while maintaining beneficial conditions for juvenile salmonids. Additional breaches of barrier beach may be conducted for the sole purpose of reducing flood risk. SCWA's proposed activity was described in detail in our notice of proposed authorization prior to the 2011 IHA (76 FR 14924; March 18, 2011); please see that document for a detailed description of SCWA's estuary management activities. Aside from minor additions to SCWA's biological and physical estuary monitoring measures, the specified activity remains the same as that described in the 2011 document.

    Dates and Duration

    The specified activity may occur at any time during the one-year timeframe (April 21, 2015, through April 20, 2016) of the proposed IHA, although construction and maintenance of a lagoon outlet channel would occur only during the lagoon management period. In addition, there are certain restrictions placed on SCWA during the harbor seal pupping season. These, as well as periodicity and frequency of the specified activities, are described in further detail below.

    Specific Geographic Region

    The estuary is located about 97 km (60 mi) northwest of San Francisco in Sonoma County, near Jenner, California (see Figure 1 of SCWA's application). The Russian River watershed encompasses 3,847 km2 (1,485 mi2) in Sonoma, Mendocino, and Lake Counties. The mouth of the Russian River is located at Goat Rock State Beach (see Figure 2 of SCWA's application); the estuary extends from the mouth upstream approximately 10 to 11 km (6-7 mi) between Austin Creek and the community of Duncans Mills (Heckel and McIver, 1994).

    Detailed Description of Activities

    Within the Russian River watershed, the U.S. Army Corps of Engineers (Corps), SCWA and the Mendocino County Russian River Flood Control and Water Conservation Improvement District (District) operate and maintain federal facilities and conduct activities in addition to the estuary management, including flood control, water diversion and storage, instream flow releases, hydroelectric power generation, channel maintenance, and fish hatchery production. The Corps, SCWA, and the District conducted these activities for many years before salmonid species in the Russian River were protected under the ESA. Upon determination that these actions were likely to affect ESA-listed salmonids, as well as designated critical habitat for these species, formal consultation under section 7 of the ESA was initiated. In 2008, NMFS issued a Biological Opinion (BiOp) for Water Supply, Flood Control Operations, and Channel Maintenance conducted by the Corps, SCWA, and the District in the Russian River watershed (NMFS, 2008). This BiOp found that the activities—including SCWA's estuary management activities—authorized by the Corps and undertaken by SCWA and the District, if continued in a manner similar to recent historic practices, were likely to jeopardize the continued existence of ESA-listed salmonids and were likely to adversely modify critical habitat.

    If a project is found to jeopardize a species or adversely modify its critical habitat, NMFS must develop and recommend a non-jeopardizing Reasonable and Prudent Alternative (RPA) to the proposed project, in coordination with the federal action agency and any applicant. A component of the RPA described in the 2008 BiOp requires SCWA to collaborate with NMFS and modify their estuary water level management in order to reduce marine influence (i.e., high salinity and tidal inflow) and promote a higher water surface elevation in the estuary in order to enhance the quality of rearing habitat for juvenile salmonids. A program of potential incremental steps prescribed to reach that goal includes adaptive management of the outlet channel. SCWA is also required to monitor the response of water quality, invertebrate production, and salmonids in and near the estuary to water surface elevation management in the estuary-lagoon system.

    The analysis contained in the BiOp found that maintenance of lagoon conditions was necessary only for the lagoon management period. See NMFS' BiOp (2008) for details of that analysis. As a result of that determination, there are three components to SCWA's estuary management activities: (1) Lagoon outlet channel management, during the lagoon management period only, required to accomplish the dual purposes of flood risk abatement and maintenance of juvenile salmonid habitat; (2) traditional artificial breaching, with the sole goal of flood risk abatement; and (3) physical and biological monitoring. The latter activity, physical and biological monitoring, will remain the same as in past years but with the addition of a new monitoring activity. In 2014, acoustic telemetry of tagged steelhead was added to the fisheries monitoring activities. As is the case for other monitoring activities in the estuary, this activity involves at least two crew members in a small motorized boat travelling throughout the estuary. Therefore, as for other such activities in the estuary, the potential exists for disturbance of pinnipeds hauled-out at peripheral haul-outs. Please see the previously referenced Federal Register notice (76 FR 14924; March 18, 2011) for detailed discussion of lagoon outlet channel management, artificial breaching, and other physical and biological monitoring activities.

    NMFS' BiOp determined that salmonid estuarine habitat may be improved by managing the Russian River estuary as a perched, freshwater lagoon and, therefore, stipulates as a RPA to existing conditions that the estuary be managed to achieve such conditions between May 15th and October 15th. In recognition of the complexity and uncertainty inherent in attempting to manage conditions in a dynamic beach environment, the BiOp stipulates that the estuarine water surface elevation RPA be managed adaptively, meaning that it should be planned, implemented, and then iteratively refined based on experience gained from implementation. The first phase of adaptive management, which has been implemented since 2010, is limited to outlet channel management (ESA PWA, 2014). The second phase, begun in 2014, requires study of and consideration of alternatives to a historical, dilapidated jetty present at Goat Rock State Beach (e.g., complete removal, partial removal).

    The plan for study of the jetty is described in greater detail in SCWA's “Feasibility of Alternatives to the Goat Rock State Beach Jetty for Managing Lagoon Water Surface Elevations—A Study Plan” (ESA PWA, 2011), and was also described in detail in our notice of proposed authorization prior to the 2013 IHA (78 FR 14985; March 8, 2013). Implementation of the study plan began in March 2014 with installation of wells monitoring water seepage through the barrier beach and geophysical mapping of the submerged substrate and structures. Visits to the well sites are not anticipated to disturb seals, as the wells are not located near the haul-out.

    Description of Marine Mammals in the Area of the Specified Activity

    Harbor seals are the most common species inhabiting the haul-out at the mouth of the Russian River (Jenner haul-out) and fine-scale local abundance data for harbor seals have been recorded extensively since 1972. California sea lions and northern elephant seals have also been observed infrequently in the project area. In addition to the primary Jenner haul-out, there are eight peripheral haul-outs nearby (see Figure 4 of SCWA's application). These include North Jenner and Odin Cove to the north; Pocked Rock, Kabemali, and Rock Point to the south; and Penny Logs, Patty's Rock, and Chalanchawi upstream within the estuary.

    This section briefly summarizes the range, population status, threats and human-caused mortality, and range-wide as well as local abundance of these species. We have reviewed SCWA's detailed species descriptions, including life history information, for accuracy and completeness and refer the reader to Sections 3 and 4 of SCWA's application instead of reprinting the information here. The following information is summarized largely from NMFS Stock Assessment Reports, which may be accessed at www.nmfs.noaa.gov/pr/sars/species.htm.

    Harbor Seals

    Harbor seals inhabit coastal and estuarine waters and shoreline areas of the northern hemisphere from temperate to polar regions. The eastern North Pacific subspecies is found from Baja California north to the Aleutian Islands and into the Bering Sea. Multiple lines of evidence support the existence of geographic structure among harbor seal populations from California to Alaska (Carretta et al., 2014). However, because stock boundaries are difficult to meaningfully draw from a biological perspective, three separate harbor seal stocks are recognized for management purposes along the west coast of the continental U.S.: (1) Inland waters of Washington, (2) outer coast of Oregon and Washington, and (3) California (Carretta et al., 2014). Multiple stocks are recognized in Alaska. Placement of a stock boundary at the California-Oregon border is not based on biology but is considered a political and jurisdictional convenience (Carretta et al., 2014). In addition, harbor seals may occur in Mexican waters, but these animals are not considered part of the California stock. Only the California stock is expected to be found in the project area.

    California harbor seals are not protected under the ESA or listed as depleted under the MMPA, and are not considered a strategic stock under the MMPA because annual human-caused mortality (43) is significantly less than the calculated potential biological removal (PBR; 1,641) (Carretta et al., 2015). The population appears to be stabilizing at what may be its carrying capacity and the fishery mortality is declining.

    The best abundance estimate of the California stock of harbor seals is 30,968 and the minimum population size of this stock is 27,348 individuals (Carretta et al., 2015). The entire population cannot be counted because some individuals are always away from haul-out sites. In addition, complete pup counts are not possible as for other species of pinniped because pups are precocious and enter the water almost immediately after birth. Therefore, the best abundance estimate is estimated by counting the number of seals ashore during the peak haul-out period (May to July) and by multiplying this count by a correction factor equal to the inverse of the estimated fraction of seals on land (Carretta et al., 2014). The current abundance estimate, as well as the minimum population size, is based off of haul-out counts from 2012.

    Counts of harbor seals in California increased from 1981 to 2004, with a calculated annual net productivity rate of 9.2 percent for the period 1983-1994 (Carretta et al., 2014). However, maximum net productivity rates cannot be estimated because measurements were not made when the stock size was very small, and the default maximum net productivity rate for pinnipeds (12 percent per year) is considered appropriate for harbor seals (Carretta et al., 2014).

    Prior to state and federal protection and especially during the nineteenth century, harbor seals along the west coast of North America were greatly reduced by commercial hunting, with only a few hundred individuals surviving in a few isolated areas along the California coast (Carretta et al., 2014). However, in the last half of this century, the population has increased dramatically. Data from 2004-09 indicate that 18 (CV = 0.73) California harbor seals are killed annually in commercial fisheries. In addition, California stranding database records for 2005-09 show an annual average of 12 such events, which is likely an underestimate because most carcasses are not recovered. Two Unusual Mortality Events (UME) of harbor seals in California occurred in 1997 and 2000 with the causes considered to be infectious disease (see www.nmfs.noaa.gov/pr/health/mmume/; accessed January 30, 2014). All west coast harbor seals that have been tested for morbilliviruses were found to be seronegative, indicating that this disease is not endemic in the population and that this population is extremely susceptible to an epidemic of this disease (Ham-Lammé et al., 1999).

    Harbor seal pupping normally occurs at the Russian River from March until late June, and sometimes into early July. The Jenner haul-out is the largest in Sonoma County. A substantial amount of monitoring effort has been conducted at the Jenner haul-out and surrounding areas. Concerned local residents formed the Stewards' Seal Watch Public Education Program in 1985 to educate beach visitors and monitor seal populations. State Parks Volunteer Docents continue this effort towards safeguarding local harbor seal habitat. On weekends during the pupping and molting season (approximately March-August), volunteers conduct public outreach and record the numbers of visitors and seals on the beach, other marine mammals observed, and the number of boats and kayaks present.

    Ongoing monthly seal counts at the Jenner haul-out were begun by J. Mortenson in January 1987, with additional nearby haul-outs added to the counts thereafter. In addition, local resident E. Twohy began daily observations of seals and people at the Jenner haul-out in November 1989. These datasets note whether the mouth at the Jenner haul-out was opened or closed at each observation, as well as various other daily and annual patterns of haul-out usage (Mortenson and Twohy, 1994). Recently, SCWA began regular baseline monitoring of the haul-out as a component of its estuary management activity. Table 1 shows average daily numbers of seals observed at the mouth of the Russian River from 1993-2005 and from 2009-14.

    Table 1—Average Daily Number of Seals Observed at Russian River Mouth for Each Month, 1993-2005; 2009-14 Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 1993 140 219 269 210 203 238 197 34 8 38 78 163 1994 138 221 243 213 208 212 246 98 26 31 101 162 1995 133 270 254 261 222 182 216 74 37 24 38 148 1996 144 175 261 247 157 104 142 65 17 29 76 139 1997 154 177 209 188 154 119 186 58 20 29 30 112 1998 119 151 192 93 170 213 232 53 33 21 93 147 1999 161 170 215 210 202 128 216 98 57 20 74 123 2000 151 185 240 180 158 245 256 63 46 50 86 127 2001 155 189 161 168 135 212 275 75 64 20 127 185 2002 117 12 20 154 134 213 215 89 43 26 73 126 2003 1 26 161 164 222 282 100 43 51 109 116 2004 2 5 39 180 202 318 307 35 40 47 68 61 2005 0 7 42 222 220 233 320 145 Mean, 1993-2005 118 137 167 191 179 203 238 76 36 32 79 134 2009 219 117 17 22 96 80 2010 66 84 129 136 109 136 267 111 59 25 89 26 2011 116 92 162 124 128 145 219 98 31 53 92 48 2012 108 74 115 169 164 166 156 128 100 71 137 51 2013 51 108 158 112 162 139 411 175 77 58 34 94 2014 98 209 243 129 145 156 266 134 53 15 27 172 Mean, 2012-14 1 89 131 173 137 157 154 158 146 78 50 66 106 Data from 1993-2005 adapted from Mortenson and Twohy (1994) and E. Twohy (unpublished data). Data from 2009-14 collected by SCWA. Months represented by dash indicate periods where data were missing or incomplete. 1 Mean calculated as a weighted average to account for unequal sample sizes between years. See SCWA application, Table 4.

    The number of seals present at the Jenner haul-out generally declines during bar-closed conditions (Mortenson, 1996). SCWA's pinniped monitoring efforts from 1996 to 2000 focused on artificial breaching activities and their effects on the Jenner haul-out. Seal counts and disturbances were recorded from one to two days prior to breaching, the day of breaching, and the day after breaching (MSC, 1997, 1998, 1999, 2000; SCWA and MSC, 2001). In each year, the trend observed was that harbor seal numbers generally declined during a beach closure and increased the day following an artificial breaching event. Heckel and McIver (1994) speculated that the loss of easy access to the haul-out and ready escape to the sea during bar-closed conditions may account for the lower numbers. Table 2 shows average daily seal counts recorded during SCWA monitoring of breaching events from 1996-2000 and 2009-14, representing bar-closed conditions, when seal numbers decline.

    Table 2—Average Number of Harbor Seals Observed at the Mouth of the Russian River During Breaching Events (i.e., Bar-Closed Conditions) by Month Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 1996-2000 173 103 100 75 17 5 22 11 2009-14 41 90 130 80 80 97 117 33 24 36 51 Dashes represent months when no estuary management events occurred.

    Mortenson (1996) observed that pups were first seen at the Jenner haul-out in late March, with maximum counts in May. In this study, pups were not counted separately from other age classes at the haul-out after August due to the difficulty in discriminating pups from small yearlings. From 1989 to 1991, Hanson (1993) observed that pupping began at the Jenner haul-out in mid-April, with a maximum number of pups observed during the first two weeks of May. This corresponds with the peaks observed at Point Reyes, where the first viable pups are born in March and the peak is the last week of April to early May (SCWA, 2014). Based on this information, pupping season at the Jenner haul-out is conservatively defined here as March 15 to June 30.

    California Sea Lions

    California sea lions range from the Gulf of California north to the Gulf of Alaska, with breeding areas located in the Gulf of California, western Baja California, and southern California. Five genetically distinct geographic populations have been identified: (1) Pacific Temperate, (2) Pacific Subtropical, (3) Southern Gulf of California, (4) Central Gulf of California and (5) Northern Gulf of California (Schramm et al., 2009). Rookeries for the Pacific Temperate population are found within U.S. waters and just south of the U.S.-Mexico border, and animals belonging to this population may be found form the Gulf of Alaska to Mexican waters off Baja California. Animals belonging to other populations (e.g., Pacific Subtropical) may range into U.S. waters during non-breeding periods. For management purposes, a stock of California sea lions comprising those animals at rookeries within the U.S. is defined (i.e., the U.S. stock of California sea lions) (Carretta et al., 2014). Pup production at the Coronado Islands rookery in Mexican waters is considered an insignificant contribution to the overall size of the Pacific Temperate population (Lowry and Maravilla-Chavez, 2005).

    California sea lions are not protected under the ESA or listed as depleted under the MMPA. Total annual human-caused mortality (389) is substantially less than the PBR (estimated at 9,200 per year); therefore, California sea lions are not considered a strategic stock under the MMPA. There are indications that the California sea lion may have reached or is approaching carrying capacity, although more data are needed to confirm that leveling in growth persists (Carretta et al., 2014).

    The best abundance estimate of the U.S. stock of California sea lions is 296,750 and the minimum population size of this stock is 153,337 individuals (Carretta et al., 2014). The entire population cannot be counted because all age and sex classes are never ashore at the same time; therefore, the best abundance estimate is determined from the number of births and the proportion of pups in the population, with censuses conducted in July after all pups have been born. Specifically, the pup count for rookeries in southern California from 2008 was adjusted for pre-census mortality and then multiplied by the inverse of the fraction of newborn pups in the population (Carretta et al., 2014). The minimum population size was determined from counts of all age and sex classes that were ashore at all the major rookeries and haul-out sites in southern and central California during the 2007 breeding season, including all California sea lions counted during the July 2007 census at the Channel Islands in southern California and at haul-out sites located between Point Conception and Point Reyes, California (Carretta et al., 2014). An additional unknown number of California sea lions are at sea or hauled out at locations that were not censused and are not accounted for in the minimum population size.

    Trends in pup counts from 1975 through 2008 have been assessed for four rookeries in southern California and for haul-outs in central and northern California. During this time period counts of pups increased at an annual rate of 5.4 percent, excluding six El Nino years when pup production declined dramatically before quickly rebounding (Carretta et al., 2014). The maximum population growth rate was 9.2 percent when pup counts from the El Niño years were removed. However, the apparent growth rate from the population trajectory underestimates the intrinsic growth rate because it does not consider human-caused mortality occurring during the time series; the default maximum net productivity rate for pinnipeds (12 percent per year) is considered appropriate for California sea lions (Carretta et al., 2014).

    Historic exploitation of California sea lions include harvest for food by Native Americans in pre-historic times and for oil and hides in the mid-1800s, as well as exploitation for a variety of reasons more recently (Carretta et al., 2014). There are few historical records to document the effects of such exploitation on sea lion abundance (Lowry et al., 1992). Data from 2003-09 indicate that a minimum of 337 (CV = 0.56) California sea lions are killed annually in commercial fisheries. In addition, a summary of stranding database records for 2005-09 shows an annual average of 65 such events, which is likely a gross underestimate because most carcasses are not recovered. California sea lions may also be removed because of predation on endangered salmonids (17 per year, 2008-10) or incidentally captured during scientific research (3 per year, 2005-09) (Carretta et al., 2014). Sea lion mortality has also been linked to the algal-produced neurotoxin domoic acid (Scholin et al., 2000). There is currently a UME declaration in effect for California sea lions. Future mortality may be expected to occur, due to the sporadic occurrence of such harmful algal blooms. Beginning in January 2013, elevated strandings of California sea lion pups have been observed in Southern California, with live sea lion strandings nearly three times higher than the historical average. The causes of this UME are under investigation (www.nmfs.noaa.gov/pr/health/mmume/californiasealions2013.htm; accessed January 29, 2014).

    Solitary California sea lions have occasionally been observed at or in the vicinity of the Russian River estuary (MSC, 1999, 2000), in all months of the year except June. Male California sea lions are occasionally observed hauled out at or near the Russian River mouth in most years: once in August 2009, January and December 2011, January 2012, December 2013, and February 2014. Other individuals were observed in the surf at the mouth of the river or swimming inside the estuary. Juvenile sea lions were observed during the summer of 2009 at the Patty's Rock haul-out, and some sea lions were observed during monitoring of peripheral haul-outs in October 2009. The occurrence of individual California sea lions in the action area may occur year-round, but is infrequent and sporadic.

    Northern Elephant Seals

    Northern elephant seals gather at breeding areas, located primarily on offshore islands of Baja California and California, from approximately December to March before dispersing for feeding. Males feed near the eastern Aleutian Islands and in the Gulf of Alaska, while females feed at sea south of 45°N (Stewart and Huber, 1993; Le Boeuf et al., 1993). Adults then return to land between March and August to molt, with males returning later than females, before dispersing again to their respective feeding areas between molting and the winter breeding season. Populations of northern elephant seals in the U.S. and Mexico are derived from a few tens or hundreds of individuals surviving in Mexico after being nearly hunted to extinction (Stewart et al., 1994). Given the recent derivation of most rookeries, no genetic differentiation would be expected. Although movement and genetic exchange continues between rookeries, most elephant seals return to their natal rookeries when they start breeding (Huber et al., 1991). The California breeding population is now demographically isolated from the Baja California population and is considered to be a separate stock.

    Northern elephant seals are not protected under the ESA or listed as depleted under the MMPA. Total annual human-caused mortality (8.8) is substantially less than the PBR (estimated at 4,882 per year); therefore, northern elephant seals are not considered a strategic stock under the MMPA. Modeling of pup counts indicates that the population has reached its Maximum Net Productivity Level, but has not yet reached carrying capacity (Carretta et al., 2014).

    The best abundance estimate of the California breeding population of northern elephant seals is 179,000 and the minimum population size of this stock is 81,368 individuals (Carretta et al., 2015). The entire population cannot be counted because all age and sex classes are never ashore at the same time; therefore, the best abundance estimate is determined by counting the number of pups produced and multiplying by the inverse of the expected ratio of pups to total animals (McCann, 1985). Specifically, the estimated number of pups born in California in 2010 (40,684) was used to extrapolate via a multiplier of 3.5 suggested by Boveng (1988) and Barlow et al. (1993) for a rapidly growing population. The minimum population size was estimated by doubling the observed pup count (to account for the pups and their mothers) (Carretta et al., 2015). An additional unknown number of northern elephant seals are at sea or hauled out at locations that were not censused and are not accounted for in the minimum population size.

    Trends in pup counts from 1958 through 2005 show that northern elephant seal colonies are continuing to grow in California, but appear to be stable or slowly decreasing in Mexico (Stewart et al., 1994; Carretta et al., 2014). Although growth rates as high as 16 percent per year have been documented for elephant seal rookeries in the U.S. from 1959 to 1981 (Cooper and Stewart, 1983), much of this growth was supported by immigration from Mexico. The highest growth rate measured for the whole U.S./Mexico population was 8.3 percent between 1965 and 1977. A generalized logistic growth model indicates that the maximum population growth rate is 11.7 percent (Carretta et al., 2014).

    Data from 2000-05 indicate that a minimum of 8.8 (CV = 0.4) northern elephant seals are killed annually in commercial fisheries, including hook-and-line, gillnet, and trawl fisheries. In addition, drift gillnet fisheries exist along the entire Pacific coast of Baja California and may take animals from this population, although few quantitative data and no species-specific information are available (Carretta et al., 2014). A summary of stranding database records for 2000-04 shows an annual average of 1.6 non-fishery related mortalities, which is likely a gross underestimate because most carcasses are not recovered.

    Censuses of pinnipeds at the mouth of the Russian River have been taken at least semi-monthly since 1987. Elephant seals were noted from 1987-95, with one or two elephant seals typically counted during May censuses, and occasional records during the fall and winter (Mortenson and Follis, 1997). A single, tagged northern elephant seal sub-adult was present at the Jenner haul-out from 2002-07. This individual seal, which was observed harassing harbor seals also present at the haul-out, was generally present during molt and again from late December through March. A single juvenile elephant seal was observed at the Jenner haul-out in June 2009 and, in recent years, a sub-adult seal was observed in late summer of 2013-14. The occurrence of individual northern elephant seals in the action area has generally been infrequent and sporadic in the past 10 years.

    Potential Effects of the Specified Activity on Marine Mammals

    A significant body of monitoring data exists for pinnipeds at the mouth of the Russian River. In addition, pinnipeds have co-existed with regular estuary management activity for decades, as well as with regular human use activity at the beach, and are likely habituated to human presence and activity. Nevertheless, SCWA's estuary management activities have the potential to disturb pinnipeds present on the beach or at peripheral haul-outs in the estuary. During breaching operations, past monitoring has revealed that some or all of the seals present typically move or flush from the beach in response to the presence of crew and equipment, though some may remain hauled-out. No stampeding of seals—a potentially dangerous occurrence in which large numbers of animals succumb to mass panic and rush away from a stimulus—has been documented since SCWA developed protocols to prevent such events in 1999. While it is likely impossible to conduct required estuary management activities without provoking some response in hauled-out animals, precautionary mitigation measures, described later in this document, ensure that animals are gradually apprised of human approach. Under these conditions, seals typically exhibit a continuum of responses, beginning with alert movements (e.g., raising the head), which may then escalate to movement away from the stimulus and possible flushing into the water. Flushed seals typically re-occupy the haul-out within minutes to hours of the stimulus. In addition, eight other haul-outs exist nearby that may accommodate flushed seals.

    In the absence of appropriate mitigation measures, it is possible that pinnipeds could be subject to injury, serious injury, or mortality, likely through stampeding or abandonment of pups. However, based on a significant body of site-specific data, harbor seals are unlikely to sustain any harassment that may be considered biologically significant. Individual animals would, at most, flush into the water in response to maintenance activities but may also simply become alert or move across the beach away from equipment and crews. During 2013, SCWA observed that harbor seals are less likely to flush from the beach when the primary aggregation of seals is north of the breaching activity (please refer to Figure 2 of SCWA's application), meaning that personnel and equipment are not required to pass the seals. Four artificial breaching events were implemented in 2013, with two of these events occurring north of the primary aggregation and two to the south (at approximately 800 and 150 ft distance) (SCWA, 2014). In both of the former cases, all seals present eventually flushed to the water, but when breaching activity remained to the south of the haul-out, only 11 and 53 percent of seals, respectively, were flushed.

    California sea lions and northern elephant seals have been observed as less sensitive to stimulus than harbor seals during monitoring at numerous other sites. For example, monitoring of pinniped disturbance as a result of abalone research in the Channel Islands showed that while harbor seals flushed at a rate of 69 percent, California sea lions flushed at a rate of only 21 percent. The rate for elephant seals declined to 0.1 percent (VanBlaricom, 2010). In the event that either of these species is present during management activities, they would be expected to display a minimal reaction to maintenance activities—less than that expected of harbor seals.

    Although the Jenner haul-out is not known as a primary pupping beach, pups have been observed during the pupping season; therefore, we have evaluated the potential for injury, serious injury, or mortality to pups. There is a lack of published data regarding pupping at the mouth of the Russian River, but SCWA monitors have observed pups on the beach. No births were observed during recent monitoring, but may be inferred based on signs indicating pupping (e.g., blood spots on the sand, birds consuming possible placental remains). Pup injury or mortality would be most likely to occur in the event of extended separation of a mother and pup, or trampling in a stampede. As discussed previously, no stampedes have been recorded since development of appropriate protocols in 1999. Any California sea lions or northern elephant seals present would be independent juveniles or adults; therefore, analysis of impacts on pups is not relevant for those species.

    Similarly, the period of mother-pup bonding, critical time needed to ensure pup survival and maximize pup health, is not expected to be impacted by estuary management activities. Harbor seal pups are extremely precocious, swimming and diving immediately after birth and throughout the lactation period, unlike most other phocids which normally enter the sea only after weaning (Lawson and Renouf, 1985; Cottrell et al., 2002; Burns et al., 2005). Lawson and Renouf (1987) investigated harbor seal mother-pup bonding in response to natural and anthropogenic disturbance. In summary, they found that the most critical bonding time is within minutes after birth. As described previously, the peak of pupping season is typically concluded by mid-May, when the lagoon management period begins. As such, it is expected that mother-pup bonding would likely be concluded as well. The number of management events during the months of March and April has been relatively low in the past, and the breaching activities occur in a single day over several hours. In addition, mitigation measures described later in this document further reduce the likelihood of any impacts to pups, whether through injury or mortality or interruption of mother-pup bonding.

    In summary, and based on extensive monitoring data, we believe that impacts to hauled-out pinnipeds during estuary management activities would be behavioral harassment of limited duration (i.e., less than one day) and limited intensity (i.e., temporary flushing at most). Stampeding, and therefore injury or mortality, is not expected—nor been documented—in the years since appropriate protocols were established (see “Mitigation” for more details). Further, the continued, and increasingly heavy (Figure 4; SCWA, 2015), use of the haul-out despite decades of breaching events indicates that abandonment of the haul-out is unlikely.

    Anticipated Effects on Habitat

    The purposes of the estuary management activities are to improve summer rearing habitat for juvenile salmonids in the Russian River estuary and/or to minimize potential flood risk to properties adjacent to the estuary. These activities would result in temporary physical alteration of the Jenner haul-out, but are essential to conserving and recovering endangered salmonid species, as prescribed by the BiOp. These salmonids are themselves prey for pinnipeds. In addition, with barrier beach closure, seal usage of the beach haul-out declines, and the three nearby river haul-outs may not be available for usage due to rising water surface elevations. Breaching of the barrier beach, subsequent to the temporary habitat disturbance, likely increases suitability and availability of habitat for pinnipeds. Biological and water quality monitoring would not physically alter pinniped habitat. Please see the previously referenced Federal Register notice (76 FR 14924; March 18, 2011) for a more detailed discussion of anticipated effects on habitat.

    During SCWA's pinniped monitoring associated with artificial breaching activities from 1996 to 2000, the number of harbor seals hauled out declined when the barrier beach closed and then increased the day following an artificial breaching event (MSC, 1997, 1998, 1999, and 2000; SCWA and MSC, 2001). This response to barrier beach closure followed by artificial breaching has remained consistent in recent years and is anticipated to continue. However, it is possible that the number of pinnipeds using the haul-out could decline during the extended lagoon management period, when SCWA would seek to maintain a shallow outlet channel rather than the deeper channel associated with artificial breaching. Collection of baseline information during the lagoon management period is included in the monitoring requirements described later in this document. SCWA's previous monitoring, as well as Twohy's daily counts of seals at the sandbar (Table 1) indicate that the number of seals at the haul-out declines from August to October, so management of the lagoon outlet channel (and managing the sandbar as a summer lagoon) would have little effect on haul-out use during the latter portion of the lagoon management period. The early portion of the lagoon management period coincides with the pupping season. Past monitoring during this period, which represents some of the longest beach closures in the late spring and early summer months, shows that the number of pinnipeds at the haul-out tends to fluctuate, rather than showing the more straightforward declines and increases associated with closures and openings seen at other times of year (MSC, 1998). This may indicate that seal haul-out usage during the pupping season is less dependent on bar status. As such, the number of seals hauled out from May through July would be expected to fluctuate, but is unlikely to respond dramatically to the absence of artificial breaching events. Regardless, any impacts to habitat resulting from SCWA's management of the estuary during the lagoon management period are not in relation to natural conditions, but rather in relation to conditions resulting from SCWA's discontinued approach of artificial breaching during this period.

    In summary, there will be temporary physical alteration of the beach. However, natural opening and closure of the beach results in the same impacts to habitat; therefore, seals are likely adapted to this cycle. In addition, the increase in rearing habitat quality has the goal of increasing salmonid abundance, ultimately providing more food for seals present within the action area. Thus, any impacts to marine mammal habitat are not expected to cause significant or long-term consequences for individual marine mammals or their populations.

    Proposed Mitigation

    In order to issue an IHA under Section 101(a)(5)(D) of the MMPA, NMFS must set forth the permissible methods of taking pursuant to such activity, and other means of effecting the least practicable impact on such species or stock and its habitat, paying particular attention to rookeries, mating grounds, and areas of similar significance, and on the availability of such species or stock for taking for certain subsistence uses.

    SCWA has proposed to continue the following mitigation measures, as implemented during the previous IHA, designed to minimize impact to affected species and stocks:

    • SCWA crews would cautiously approach the haul-out ahead of heavy equipment to minimize the potential for sudden flushes, which may result in a stampede—a particular concern during pupping season.

    • SCWA staff would avoid walking or driving equipment through the seal haul-out.

    • Crews on foot would make an effort to be seen by seals from a distance, if possible, rather than appearing suddenly, again preventing sudden flushes.

    • During breaching events, all monitoring would be conducted from the overlook on the bluff along Highway 1 adjacent to the haul-out in order to minimize potential for harassment.

    • A water level management event may not occur for more than two consecutive days unless flooding threats cannot be controlled.

    In addition, SCWA proposes to continue mitigation measures specific to pupping season (March 15-June 30), as implemented in the previous IHAs:

    • SCWA will maintain a one week no-work period between water level management events (unless flooding is an immediate threat) to allow for an adequate disturbance recovery period. During the no-work period, equipment must be removed from the beach.

    • If a pup less than one week old is on the beach where heavy machinery would be used or on the path used to access the work location, the management action will be delayed until the pup has left the site or the latest day possible to prevent flooding while still maintaining suitable fish rearing habitat. In the event that a pup remains present on the beach in the presence of flood risk, SCWA would consult with NMFS to determine the appropriate course of action. SCWA will coordinate with the locally established seal monitoring program (Stewards' Seal Watch) to determine if pups less than one week old are on the beach prior to a breaching event.

    • Physical and biological monitoring will not be conducted if a pup less than one week old is present at the monitoring site or on a path to the site.

    For all activities, personnel on the beach would include up to two equipment operators, three safety team members on the beach (one on each side of the channel observing the equipment operators, and one at the barrier to warn beach visitors away from the activities), and one safety team member at the overlook on Highway 1 above the beach. Occasionally, there would be two or more additional people (SCWA staff or regulatory agency staff) on the beach to observe the activities. SCWA staff would be followed by the equipment, which would then be followed by an SCWA vehicle (typically a small pickup truck, the vehicle would be parked at the previously posted signs and barriers on the south side of the excavation location). Equipment would be driven slowly on the beach and care would be taken to minimize the number of shut-downs and start-ups when the equipment is on the beach. All work would be completed as efficiently as possible, with the smallest amount of heavy equipment possible, to minimize disturbance of seals at the haul-out. Boats operating near river haul-outs during monitoring would be kept within posted speed limits and driven as far from the haul-outs as safely possible to minimize flushing seals.

    We have carefully evaluated SCWA's proposed mitigation measures and considered their effectiveness in past implementation to preliminarily determine whether they are likely to effect the least practicable impact on the affected marine mammal species and stocks and their habitat. Our evaluation of potential measures included consideration of the following factors in relation to one another: (1) The manner in which, and the degree to which, the successful implementation of the measure is expected to minimize adverse impacts to marine mammals, (2) the proven or likely efficacy of the specific measure to minimize adverse impacts as planned; and (3) the practicability of the measure for applicant implementation.

    Any mitigation measure(s) we prescribe should be able to accomplish, have a reasonable likelihood of accomplishing (based on current science), or contribute to the accomplishment of one or more of the general goals listed below:

    • Avoidance or minimization of injury or death of marine mammals wherever possible (goals 2, 3, and 4 may contribute to this goal).

    • A reduction in the number (total number or number at biologically important time or location) of individual marine mammals exposed to stimuli expected to result in incidental take (this goal may contribute to 1, above, or to reducing takes by behavioral harassment only).

    • A reduction in the number (total number or number at biologically important time or location) of times any individual marine mammal would be exposed to stimuli expected to result in incidental take (this goal may contribute to 1, above, or to reducing takes by behavioral harassment only).

    • A reduction in the intensity of exposure to stimuli expected to result in incidental take (this goal may contribute to 1, above, or to reducing the severity of behavioral harassment only).

    • Avoidance or minimization of adverse effects to marine mammal habitat, paying particular attention to the prey base, blockage or limitation of passage to or from biologically important areas, permanent destruction of habitat, or temporary disturbance of habitat during a biologically important time.

    • For monitoring directly related to mitigation, an increase in the probability of detecting marine mammals, thus allowing for more effective implementation of the mitigation.

    Based on our evaluation of SCWA's proposed measures and on SCWA's record of management at the mouth of the Russian River including information from monitoring of SCWA's implementation of the mitigation measures as prescribed under the previous IHAs, we have preliminarily determined that the proposed mitigation measures provide the means of effecting the least practicable impact on marine mammal species or stocks and their habitat, paying particular attention to rookeries, mating grounds, and areas of similar significance.

    Proposed Monitoring and Reporting

    In order to issue an IHA for an activity, Section 101(a)(5)(D) of the MMPA states that NMFS must set forth “requirements pertaining to the monitoring and reporting of such taking”. The MMPA implementing regulations at 50 CFR 216.104(a)(13) indicate that requests for incidental take authorizations must include the suggested means of accomplishing the necessary monitoring and reporting that will result in increased knowledge of the species and of the level of taking or impacts on populations of marine mammals that are expected to be present in the proposed action area.

    Any monitoring requirement we prescribe should accomplish one or more of the following general goals:

    1. An increase in the probability of detecting marine mammals, both within defined zones of effect (thus allowing for more effective implementation of the mitigation) and in general to generate more data to contribute to the analyses mentioned below;

    2. An increase in our understanding of how many marine mammals are likely to be exposed to stimuli that we associate with specific adverse effects, such as behavioral harassment or hearing threshold shifts;

    3. An increase in our understanding of how marine mammals respond to stimuli expected to result in incidental take and how anticipated adverse effects on individuals may impact the population, stock, or species (specifically through effects on annual rates of recruitment or survival) through any of the following methods:

    • Behavioral observations in the presence of stimuli compared to observations in the absence of stimuli (need to be able to accurately predict pertinent information, e.g., received level, distance from source);

    • Physiological measurements in the presence of stimuli compared to observations in the absence of stimuli (need to be able to accurately predict pertinent information, e.g., received level, distance from source);

    • Distribution and/or abundance comparisons in times or areas with concentrated stimuli versus times or areas without stimuli;

    4. An increased knowledge of the affected species; or

    5. An increase in our understanding of the effectiveness of certain mitigation and monitoring measures.

    SCWA submitted a marine mammal monitoring plan as part of the IHA application. It can be found on the Internet at www.nmfs.noaa.gov/pr/permits/incidental/construction.htm. The plan, which has been successfully implemented by SCWA under previous IHAs, may be modified or supplemented based on comments or new information received from the public during the public comment period. The purpose of this monitoring plan, which is carried out collaboratively with the Stewards of the Coasts and Redwoods (Stewards) organization, is to detect the response of pinnipeds to estuary management activities at the Russian River estuary. SCWA has designed the plan both to satisfy the requirements of the IHA, and to address the following questions of interest:

    1. Under what conditions do pinnipeds haul out at the Russian River estuary mouth at Jenner?

    2. How do seals at the Jenner haul-out respond to activities associated with the construction and maintenance of the lagoon outlet channel and artificial breaching activities?

    3. Does the number of seals at the Jenner haul-out significantly differ from historic averages with formation of a summer (May 15 to October 15) lagoon in the Russian River estuary?

    4. Are seals at the Jenner haul-out displaced to nearby river and coastal haul-outs when the mouth remains closed in the summer?

    Proposed Monitoring Measures

    In summary, past monitoring includes the following, which is proposed to continue should an IHA be issued:

    Baseline Monitoring—Seals at the Jenner haul-out are counted twice monthly for the term of the IHA. This baseline information will provide SCWA with details that may help to plan estuary management activities in the future to minimize pinniped interaction. This census begins at local dawn and continues for eight hours. All seals hauled out on the beach are counted every thirty minutes from the overlook on the bluff along Highway 1 adjacent to the haul-out using spotting scopes. Monitoring may conclude for the day if weather conditions affect visibility (e.g., heavy fog in the afternoon). Counts are scheduled for two days out of each month, with the intention of capturing a low and high tide each in the morning and afternoon. Depending on how the sandbar is formed, seals may haul out in multiple groups at the mouth. At each thirty-minute count, the observer indicates where groups of seals are hauled out on the sandbar and provides a total count for each group. If possible, adults and pups are counted separately.

    In addition to the census data, disturbances of the haul-out are recorded. The method for recording disturbances follows those in Mortenson (1996). Disturbances would be recorded on a three-point scale that represents an increasing seal response to the disturbance (Table 3). The time, source, and duration of the disturbance, as well as an estimated distance between the source and haul-out, are recorded. It should be noted that only responses falling into Mortenson's Levels 2 and 3 will be considered as harassment under the MMPA, under the terms of this proposed IHA.

    Table 3—Seal Response to Disturbance Level Type of response Definition 1 Alert Seal head orientation in response to disturbance. This may include turning head towards the disturbance, craning head and neck while holding the body rigid in a u-shaped position, or changing from a lying to a sitting position. 2 Movement Movements away from the source of disturbance, ranging from short withdrawals over short distances to hurried retreats many meters in length. 3 Flight All retreats (flushes) to the water, another group of seals, or over the beach.

    Weather conditions are recorded at the beginning of each census. These include temperature, percent cloud cover, and wind speed (Beaufort scale). Tide levels and estuary water surface elevations are correlated to the monitoring start and end times.

    In an effort towards understanding possible relationships between use of the Jenner haul-out and nearby coastal and river haul-outs, several other haul-outs on the coast and in the Russian River estuary are monitored as well (see Figure 4 of SCWA's application). The peripheral haul-outs are visited for ten-minute counts twice during each baseline monitoring day. All pinnipeds hauled out were counted from the same vantage point(s) at each haul-out using a high-powered spotting scope or binoculars.

    Estuary Management Event Monitoring, Lagoon Outlet Channel—Should the mouth close during the lagoon management period, SCWA would construct a lagoon outlet channel as required by the BiOp. Activities associated with the initial construction of the outlet channel, as well as the maintenance of the channel that may be required, would be monitored for disturbances to the seals at the Jenner haul-out.

    A one-day pre-event channel survey would be made within one to three days prior to constructing the outlet channel. The haul-out would be monitored on the day the outlet channel is constructed and daily for up to the maximum two days allowed for channel excavation activities. Monitoring would also occur on each day that the outlet channel is maintained using heavy equipment for the duration of the lagoon management period. Monitoring of outlet channel construction and maintenance would correspond with that described under the “Baseline” section previously, with the exception that management activity monitoring duration is defined by event duration, rather than being set at eight hours. On the day of the management event, pinniped monitoring begins at least one hour prior to the crew and equipment accessing the beach work area and continues through the duration of the event, until at least one hour after the crew and equipment leave the beach.

    In an attempt to understand whether seals from the Jenner haul-out are displaced to coastal and river haul-outs nearby when management events occur, other nearby haul-outs are monitored concurrently with monitoring of outlet channel construction and maintenance activities. This provides an opportunity to qualitatively assess whether these haul-outs are being used by seals displaced from the Jenner haul-out during lagoon outlet channel excavation and maintenance. This monitoring would not provide definitive results regarding displacement to nearby coastal and river haul-outs, as individual seals are not marked or photo-identified, but is useful in tracking general trends in haul-out use during lagoon outlet channel excavation and maintenance. As volunteers are required to monitor these peripheral haul-outs, haul-out locations may need to be prioritized if there are not enough volunteers available. In that case, priority would be assigned to the nearest haul-outs (North Jenner and Odin Cove), followed by the Russian River estuary haul-outs, and finally the more distant coastal haul-outs.

    Estuary Management Event Monitoring, Artificial Breaching Events—In accordance with the Russian River BiOp, SCWA may artificially breach the barrier beach outside of the summer lagoon management period, and may conduct a maximum of two such breachings during the lagoon management period, when estuary water surface elevations rise above seven feet. In that case, NMFS may be consulted regarding potential scheduling of an artificial breaching event to open the barrier beach and reduce flooding risk.

    Pinniped response to artificial breaching will be monitored at each such event during the term of the IHA. Methods would follow the census and disturbance monitoring protocols described in the “Baseline” section, which were also used for the 1996 to 2000 monitoring events (MSC, 1997, 1998, 1999, 2000; SCWA and MSC, 2001). The exception, as for lagoon management events, is that duration of monitoring is dependent upon duration of the event. On the day of the management event, pinniped monitoring begins at least one hour prior to the crew and equipment accessing the beach work area and continues through the duration of the event, until at least one hour after the crew and equipment leave the beach.

    For all counts, the following information would be recorded in thirty-minute intervals: (1) Pinniped counts, by species; (2) behavior; (3) time, source and duration of any disturbance; (4) estimated distances between source of disturbance and pinnipeds; (5) weather conditions (e.g., temperature, wind); and (5) tide levels and estuary water surface elevation.

    Monitoring During Pupping Season—The pupping season is defined as March 15 to June 30. Baseline, lagoon outlet channel, and artificial breaching monitoring during the pupping season will include records of neonate (pups less than one week old) observations. Characteristics of a neonate pup include: Body weight less than 15 kg; thin for their body length; an umbilicus or natal pelage present; wrinkled skin; and awkward or jerky movements on land. SCWA will coordinate with the Seal Watch monitoring program to determine if pups less than one week old are on the beach prior to a water level management event.

    If, during monitoring, observers sight any pup that might be abandoned, SCWA would contact the NMFS stranding response network immediately and also report the incident to NMFS' West Coast Regional Office and Office of Protected Resources within 48 hours. Observers will not approach or move the pup. Potential indications that a pup may be abandoned are no observed contact with adult seals, no movement of the pup, and the pup's attempts to nurse are rebuffed.

    Staffing—Monitoring is conducted by qualified individuals, which may include professional biologists employed by NMFS or SCWA or volunteers trained by the Stewards' Seal Watch program (Stewards). All volunteer monitors are required to attend classroom-style training and field site visits to the haul-outs. Training covers the MMPA and conditions of the IHA, SCWA's pinniped monitoring protocols, pinniped species identification, age class identification (including a specific discussion regarding neonates), recording of count and disturbance observations (including completion of datasheets), and use of equipment. Pinniped identification includes the harbor seal, California sea lion, and northern elephant seal, as well as other pinniped species with potential to occur in the area. Generally, SCWA staff and volunteers collect baseline data on Jenner haul-out use during the twice-monthly monitoring events. A schedule for this monitoring would be established with Stewards once volunteers are available for the monitoring effort. SCWA staff monitors lagoon outlet channel excavation and maintenance activities and artificial breaching events at the Jenner haul-out, with assistance from Stewards volunteers as available. Stewards volunteers monitor the coastal and river haul-out locations during lagoon outlet channel excavation and maintenance activities.

    Training on the MMPA, pinniped identification, and the conditions of the IHA is held for staff and contractors assigned to estuary management activities. The training includes equipment operators, safety crew members, and surveyors. In addition, prior to beginning each water surface elevation management event, the biologist monitoring the event participates in the onsite safety meeting to discuss the location(s) of pinnipeds at the Jenner haul-out that day and methods of avoiding and minimizing disturbances to the haul-out as outlined in the IHA.

    Reporting

    SCWA is required to submit a report on all activities and marine mammal monitoring results to the Office of Protected Resources, NMFS, and the West Coast Regional Administrator, NMFS, ninety days prior to the expiration of the IHA if a renewal is sought, or within ninety days of the expiration of the IHA otherwise. This annual report will also be distributed to California State Parks and Stewards, and would be available to the public on SCWA's Web site. This report will contain the following information:

    • The number of pinnipeds taken, by species and age class (if possible);

    • Behavior prior to and during water level management events;

    • Start and end time of activity;

    • Estimated distances between source and pinnipeds when disturbance occurs;

    • Weather conditions (e.g., temperature, wind, etc.);

    • Haul-out reoccupation time of any pinnipeds based on post-activity monitoring;

    • Tide levels and estuary water surface elevation; and

    • Pinniped census from bi-monthly and nearby haul-out monitoring.

    The annual report includes descriptions of monitoring methodology, tabulation of estuary management events, summary of monitoring results, and discussion of problems noted and proposed remedial measures.

    Summary of Previous Monitoring

    SCWA complied with the mitigation and monitoring required under all previous authorizations. In accordance with the 2014 IHA, SCWA submitted a Report of Activities and Monitoring Results, covering the period of January 1 through December 31, 2014. Previous monitoring reports (available at www.nmfs.noaa.gov/pr/permits/incidental/construction.htm) provided additional analysis of monitoring results from 2009-13. A barrier beach was formed eleven times during 2014, but SCWA was required to implement artificial breaching for only six of these closure events. The Russian River outlet was closed to the ocean for a total of 110 days in 2014, including extended closures totaling 29 days during the lagoon management period. However, these closures all culminated in natural breaches and no outlet channel management events were required. During 2013, five artificial breaching events occurred (SCWA, 2014). In January 2012, the barrier beach was artificially breached after two days of breaching activity. There were also several periods over the course of the year where the barrier beach closed or became naturally perched and then subsequently breached naturally (SCWA, 2013). In 2011, no water level management activities occurred (SCWA, 2012). In 2010, one lagoon management event and two artificial breaching events occurred (SCWA, 2011). Pinniped monitoring occurred no more than 3 days before, the day of, and the day after each water level management activity. In addition, SCWA conducted biological and physical monitoring as described previously. During the course of these activities, SCWA did not exceed the take levels authorized under the relevant IHAs.

    Baseline Monitoring

    Baseline monitoring was performed to gather additional information about the population of harbor seals utilizing the Jenner haul-out including population trends, patterns in seasonal abundance and the influence of barrier beach condition on harbor seal abundance. The effect of tide cycle and time of day on the abundance of seals at the Jenner haul-out was explored in detail in a previous report (SCWA, 2012); data collected in 2013-14 did not change the interpretation of these findings. Baseline monitoring at the mouth of the Russian River was conducted concurrently with monitoring of the peripheral haul-outs, and was scheduled for two days out of each month with the intention of capturing a low and high tide each in the morning and afternoon. A total of 23 baseline surveys were conducted in 2014. Figure 3 of SCWA's 2014 report shows the mean number of harbor seals during twice-monthly baseline monitoring events from 2010-14.

    Peak seal abundance, as determined by the single greatest count of harbor seals at the Jenner haul-out, was on March 6 (424 seals), and overall mean seal abundance at Jenner was greatest in July (mean = 266 ± 2.1 s.e.). Seal abundance was significantly greater in July and March compared to all other months except February. The July peak in abundance occurred during the summer molting period, while the March peak in abundance occurred prior to the start of pupping. Similar to previous years, seal abundance declined in the fall. The reduction in seal abundance during the fall months, while not atypical, may have been more severe for 2014 due to the long periods of barrier beach closures during those months.

    No distressed or abandoned pups were reported in 2014. Pup production at the Jenner haul-out was 23.2 percent of total seals as calculated from the peak pup count recorded on April 29 and the number of adult harbor seals present at the same time. Although lower than in 2013, this level of production is more typical of past years as compared to 2012, where 13.8 percent of seals were pups at the time of the peak pup count. The average of pups observed (when pups were present) during April and May have been similar between years, ranging from 12.9-15.4 for 2011-14. Comparison of count data between the Jenner and peripheral haul-outs did not show any obvious correlations (e.g., the number of seals occupying peripheral haul-outs compared to the Jenner haul-out did not necessarily increase or decrease as a result of disturbance caused by beach visitors). Please review SCWA's report for a more detailed discussion.

    Water Level Management Activity Monitoring

    Six each pre-breaching, breaching, and post-breaching surveys were conducted in 2014. Artificial breaching events occurred on January 2, January 30, March 24, October 22, November 17, and November 26. No injuries or mortalities were observed during 2014, and harbor seal reactions ranged from merely alerting to crew presence to flushing from the beach. No California sea lions were observed during water level management activities or during biological and physical monitoring of the beach and estuary. A juvenile elephant seal was observed on several occasions.

    Total observed incidences of marine mammal take, by Level B harassment only, from water level management activity and biological and physical monitoring, was 2,116 harbor seals (detailed in Table 4) and two northern elephant seals (one each disturbed during activity indicated on July 22 and August 6 below). No California sea lions were observed during water level management activities or during biological and physical monitoring of the beach and estuary. While the observed take was significantly lower than the level authorized, it is possible that incidental take in future years could approach the level authorized. Actual take is dependent largely upon the number of water level management events that occur, which is unpredictable. Take of species other than harbor seals depends upon whether those species, which do not consistently utilize the Jenner haul-out, are present. The authorized take, though much higher than the actual take, was justified based on conservative estimated scenarios for animal presence and necessity of water level management. No significant departure from the method of estimation is used for the proposed IHA (see “Estimated Take by Incidental Harassment”) for the same activities in 2015.

    Table 4—Observed Incidental Harassment (Level B Harassment Only) of Harbor Seals During Russian River Estuary Management Activities, 2013 Date Event type Observed take Age class a Number Jan 2 Artificial breaching Adult 80 Jan 16 Beach topographic survey Adult 54 Jan 30 Artificial breaching Adult 163 Feb 6 Beach topographic survey Adult 35 Feb 20 Baseline monitoring Adult 12 Mar 5 Jetty study Adult 53 Mar 20 Beach topographic survey Adult 172 Mar 23 Pre-breaching survey Adult 2 Mar 24 Artificial breaching Adult 110 Apr 9 Beach topographic survey Adult 10 May 29 Fish seining Adult 12 Jun 5 Beach topographic survey Adult, pup 142 + 5 Jul 3 Beach topographic survey Adult 228 Jul 22 Jetty study Adult 186 Jul 29 Jetty study Adult 33 Aug 6 Beach topographic survey 169 Sep 18 Beach topographic survey 165 Sep 30 Jetty study 3 Oct 16 Beach topographic survey 129 Oct 22 Artificial breaching 47 Nov 14 Pre-breaching survey 46 Nov 17 Artificial breaching 103 Nov 26 Artificial breaching 162 Total 2,116 a Pups are counted separately through June, after which all seals are counted as adults as it becomes more difficult to accurately age individuals.

    It should be noted that one of the primary reasons for the increase in observed incidences of incidental take in 2013-14 (1,351 and 2,116) compared with prior years (208 in 2012, 42 in 2011, 290 in 2010) was a change in protocol for the beach topographic surveys (although realized level of activity would be expected to remain a primary determinant in future years). Due to the frequent and prolonged river mouth closures in 2013—including closures of 25 days in June/July and 21 days in September/October—there was an increased need to gather complete information about the topography and sand elevation of the beach to best inform water level management activities.

    This necessitated the survey crew to access the entire beach, including any area where seals were hauled out. Therefore, beginning on May 30, 2013, the methods for conducting the monthly topographic surveys of the barrier beach were changed. Previously, monitors at a distance would inform survey crews via radio if harbor seals became alert to their presence. Survey crews would then retreat or avoid certain areas as necessary to avoid behavioral harassment of the seals. According to the revised protocol, and provided that no neonates or nursing pups were on the haul-out, the survey crew would continue their approach. The survey crews would proceed in a manner that allowed for the seals to gradually vacate the beach before the survey proceeded, thereby reducing the intensity of behavioral reactions as much as possible, but the numbers of incidences of behavioral harassment nevertheless increased. SCWA expects that this revised protocol would remain in place for the coming year.

    SCWA continued to investigate the relative disturbance caused by their activities versus that caused by other sources (see Figures 5-6 of SCWA's monitoring report as well as SCWA, 2014). The data recorded during 2014 do not differ from the findings reported in SCWA (2014). Harbor seals are most frequently disturbed by people on foot, with an increase in frequency of people present during bar-closed conditions (see Figures 5-6 of SCWA's monitoring report). Kayakers are the next most frequent source of disturbance overall, also with an increase during bar-closed conditions. For any disturbance event it is often only a fraction of the total haul-out that responds. Some sources of disturbance, though rare, have a larger disturbing effect when they occur. For example, disturbances from dogs occur less frequently, but these incidents often disturb over half of the seals hauled out.

    Conclusions

    The following section provides a summary of information available in SCWA's monitoring report. The primary purpose of SCWA's Pinniped monitoring plan is to detect the response of pinnipeds to estuary management activities at the Russian River estuary. However, as described previously, the questions listed below are also of specific interest. The limited data available thus far precludes drawing definitive conclusions regarding the key questions in SCWA's monitoring plan, but we discuss preliminary conclusions and available evidence below.

    1. Under what conditions do pinnipeds haul out at the Russian River estuary mouth at Jenner?

    A summary of baseline pinniped monitoring provided in SCWA (2012) concluded that time of year, tidal state, and time of day all influenced harbor seal abundance at the Jenner haul-out. Baseline data collected from 2009-13 indicate that the highest numbers of pinnipeds are observed at the Jenner haul-out in July (during the molting season; see Figure 3 of SCWA's monitoring report), as would be expected on the basis of harbor seal biological and physiological requirements (Herder, 1986; Allen et al., 1989; Stewart and Yochem, 1994; Hanan, 1996; Gemmer, 2002). Most notable for 2014 was the increase in the number of seals observed during February, March, and December. Although multiple factors likely influence harbor seal presence at the haul-out, SCWA believes that barrier beach condition (i.e., open or closed) may be significant. Daily average abundance of seals was lower during bar-closed conditions compared to bar-open conditions. This effect is likely due to a combination of factors, including increased human disturbance, reduced access to the ocean from the estuary side of the barrier beach, and the increased disturbance from wave action when seals utilize the ocean side of the barrier beach. While earlier results suggested there may have been a relationship between the level of disturbance and river mouth condition (SCWA, 2013, 2014), in 2014 there was no evidence that there was a significant increase in the number of people near the haul-out or the number of disturbance events during mouth closed conditions.

    Overall, seals appear to utilize the Jenner haul-out throughout the tidal cycle. Seal abundance is significantly lower during the highest of tides when the haul-out is subject to an increase in wave overwash. Time of day had some effect on seal abundance at the Jenner haul-out, as abundance was greater in the afternoon hours compared to the morning hours. More analysis exploring the relationship of ambient temperature, incidence of disturbance, and season on time of day effects would help to explain why these variations in seal abundance occur. It is likely that a combination of multiple factors (e.g., season, tides, wave heights, level of beach disturbance) influence when the haul-out is most utilized.

    2. How do seals at the Jenner haul-out respond to activities associated with the construction and maintenance of the lagoon outlet channel and artificial breaching activities?

    SCWA has, thus far, implemented the lagoon outlet channel only once (July 8, 2010). The response of harbor seals at the Jenner haul-out to the outlet channel implementation activities was similar to responses observed during past artificial breaching events (MSC, 1997, 1998, 1999, 2000; SCWA and MSC, 2001). The harbor seals typically alert to the sound of equipment on the beach and leave the haul-out as the crew and equipment approach. Individuals then haul out on the beach while equipment is operating, leaving the beach again when equipment and staff depart, and typically begin to return to the haul-out within thirty minutes of the work ending. Because the barrier beach reformed soon after outlet channel implementation and subsequently breached on its own following the 2010 event, maintenance of the outlet channel was not necessary and monitoring of the continued response of pinnipeds at the Jenner haul-out to maintenance of the outlet channel and management of the lagoon for the duration of the lagoon management period has not yet been possible. As noted previously, when breaching activities were conducted south of the haul-out location seals often remained on the beach during all or some of the breaching activity. This indicates that seals are less disturbed by activities when equipment and crew do not pass directly past their haul-out.

    3. Does the number of seals at the Jenner haul-out significantly differ from historic averages with formation of a summer lagoon in the Russian River estuary?

    The duration of closures in recent years has not generally been dissimilar from the duration of closures that have been previously observed at the estuary, and lagoon outlet channel implementation has occurred only once, meaning that there has been a lack of opportunity to study harbor seal response to extended lagoon conditions. A barrier beach has formed during the lagoon management period twelve times since SCWA began implementing the lagoon outlet channel adaptive management plan, with an average duration of nine days. However, the additional sustained river outlet closures observed in 2014 during the lagoon management period (maximum 29 days) provide some information regarding the abundance of seals during the formation of a summer lagoon. While seal abundance was lower overall during bar-closed conditions, overall there continues to be a slight increasing trend in seal abundance. These observations may indicate that, while seal abundance exhibits a short-term decline following bar closure, the number of seals utilizing the Jenner haul-out overall during such conditions is not affected. Short-term fluctuations in abundance aside, it appears that the general trends of increased abundance during summer and decreased abundance during fall, which coincide with the annual molt and likely foraging dispersal, respectively, are not affected. Such short-term fluctuations are likely not an indicator that seals are less likely to use the Jenner haul-out at any time.

    4. Are seals at the Jenner haul-out displaced to nearby river and coastal haul-outs when the mouth remains closed in the summer?

    Initial comparisons of peripheral (river and coastal) haul-out count data to the Jenner haul-out counts have been inconclusive (see Table 2 and Figures 7-8 of SCWA's monitoring report), and further information from estuary management activities is needed.

    Estimated Take by Incidental Harassment

    Except with respect to certain activities not pertinent here, section 3(18) of the MMPA defines “harassment” as: “. . . any act of pursuit, torment, or annoyance which (i) has the potential to injure a marine mammal or marine mammal stock in the wild [Level A harassment]; or (ii) has the potential to disturb a marine mammal or marine mammal stock in the wild by causing disruption of behavioral patterns, including, but not limited to, migration, breathing, nursing, breeding, feeding, or sheltering [Level B harassment].”

    SCWA has requested, and NMFS proposes, authorization to take harbor seals, California sea lions, and northern elephant seals, by Level B harassment only, incidental to estuary management activities. These activities, involving increased human presence and the use of heavy equipment and support vehicles, are expected to harass pinnipeds present at the haul-out through disturbance only. In addition, monitoring activities prescribed in the BiOp may harass additional animals at the Jenner haul-out and at the three haul-outs located in the estuary (Penny Logs, Patty's Rock, and Chalanchawi). Estimates of the number of harbor seals, California sea lions, and northern elephant seals that may be harassed by the proposed activities is based upon the number of potential events associated with Russian River estuary management activities and the average number of individuals of each species that are present during conditions appropriate to the activity. As described previously in this document, monitoring effort at the mouth of the Russian River has shown that the number of seals utilizing the haul-out declines during bar-closed conditions. Tables 5 and 6 detail the total number of estimated takes.

    Events associated with lagoon outlet channel management would occur only during the lagoon management period, and are split into two categories: (1) Initial channel implementation, which would likely occur between May and September, and (2) maintenance and monitoring of the outlet channel, which would continue until October 15. In addition, it is possible that the initial outlet channel could close through natural processes, requiring additional channel implementation events. Based on past experience, SCWA estimates that a maximum of three outlet channel implementation events could be required. Outlet channel implementation events would only occur when the bar is closed; therefore, it is appropriate to use data from bar-closed monitoring events in estimating take (Table 2). Construction of the outlet channel is designed to produce a perched outflow, resulting in conditions that more closely resemble bar-closed than bar-open with regard to pinniped haul-out usage. As such, bar-closed data is appropriate for estimating take during all lagoon management period maintenance and monitoring activity. As dates of outlet channel implementation cannot be known in advance, the highest daily average of seals per month—the March average for 2009-14—is used in estimating take. For maintenance and monitoring activities associated with the lagoon outlet channel, which would occur on a weekly basis following implementation of the outlet channel, the average number of harbor seals for each month was used.

    Artificial breaching activities would also occur during bar-closed conditions. Data collected specifically during bar-closed conditions may be used for estimating take associated with artificial breaching (Table 2). The number of estimated artificial breaching events is also informed by experience, and is equal to the annual average number of bar closures recorded for a given month from 1996-2013.

    Prior to 2014, for monthly topographic surveys on the barrier beach, SCWA estimated that only ten percent of seals hauled out would be likely to be disturbed by this activity, which involves two people walking along the barrier beach with a survey rod. During those surveys a pinniped monitor was positioned at the Highway 1 overlook and would notify the surveyors via radio when any seals on the haul-out begin to alert to their presence. This enabled the surveyors to retreat slowly away from the haul-out, typically resulting in no disturbance. However, protocol for this monitoring activity has been changed (i.e., surveyors will continue cautiously rather than retreat when seals alert—this is necessary to collect required data) and the resulting incidences of take are now estimated as one hundred percent of the seals expected to be encountered. The exception to this change is during the pupping season, when surveyors would continue to avoid seals to reduce harassment of pups and/or mothers with neonates. For the months of March-May, the assumption that only ten percent of seals present would be harassed is retained. The number of seals expected to be encountered is based on the average monthly number of seals hauled out as recorded during baseline surveys conducted by SCWA in 2012-14 (Table 1).

    For biological and physical habitat monitoring activities in the estuary, it was assumed that pinnipeds may be encountered once per event and flush from a river haul-out. The potential for harassment associated with these events is limited to the three haul-outs located in the estuary. In past experience, SCWA typically sees no more than a single harbor seal at these haul-outs, which consist of scattered logs and rocks that often submerge at high tide.

    Table 5—Estimated Number of Harbor Seal Takes Resulting From Russian River Estuary Management Activities Number of animals expected to occur a Number of events b c Potential total number of
  • individual animals
  • that may be taken
  • Lagoon Outlet Channel Management (May 15 to October 15) Implementation: 117 d Implementation: 3 Implementation: 351. Maintenance and Monitoring: Maintenance: Maintenance: 1,160. May: 80 May: 1 June: 97 June-Sept: 4/month July: 117 Oct: 1 Aug: 17 Monitoring: Monitoring: 552. Sept: 33 June-Sept: 2/month Oct: 24 Oct: 1 Total: 2,063. Artificial Breaching Oct: 24 Oct: 2 Oct: 48. Nov: 36 Nov: 2 Nov: 72. Dec: 51 Dec: 2 Dec: 102. Jan: 41 Jan: 1 Jan: 41. Feb: 90 Feb: 1 Feb: 90. Mar: 130 Mar: 1 Mar: 130. Apr: 80 Apr: 1 Apr: 80. May: 80 May: 2 May: 160. 12 events maximum Total: 723 Topographic and Geophysical Beach Surveys Jan: 89
  • Feb: 131.
  • Mar: 173.
  • Apr: 137
  • May: 157
  • Jun: 154
  • Jul: 158
  • Aug: 146
  • Sep: 78
  • Oct: 50
  • Nov: 66
  • Dec: 106
  • 1 topographic survey/month; 100 percent of animals present Jun-Feb; 10 percent of animals present Mar-May Jan: 89
  • Feb: 131
  • Mar: 17
  • Apr: 14.
  • May: 16.
  • Jun: 154
  • Jul: 158
  • Aug: 146
  • Sep: 78
  • Oct: 50
  • Nov: 66
  • Dec: 106.
  • Total: 1,025 Biological and Physical Habitat Monitoring in the Estuary 1 e 165 165 Total 3,976 a For Lagoon Outlet Channel Management and Artificial Breaching, average daily number of animals corresponds with data from Table 2. For Topographic and Geophysical Beach Surveys, average daily number of animals corresponds with 2012-14 data from Table 1. b For implementation of the lagoon outlet channel, an event is defined as a single, two-day episode. It is assumed that the same individual seals would be hauled out during a single event. For the remaining activities, an event is defined as a single day on which an activity occurs. Some events may include multiple activities. c Number of events for artificial breaching derived from historical data. The average number of events for each month was rounded up to the nearest whole number; estimated number of events for December was increased from one to two because multiple closures resulting from storm events have occurred in recent years during that month. These numbers likely represent an overestimate, as the average annual number of events is six. d Although implementation could occur at any time during the lagoon management period, the highest daily average per month from the lagoon management period was used. e Based on past experience, SCWA expects that no more than one seal may be present, and thus have the potential to be disturbed, at each of the three river haul-outs. Number of events includes addition of acoustic telemetry surveys.
    Table 6—Estimated Number of California Sea Lion and Elephant Seal Takes Resulting From Russian River Estuary Management Activities Species Number of
  • animals expected
  • to occur a
  • Number of events a Potential total
  • number of
  • individual
  • animals that
  • may be taken
  • Lagoon Outlet Channel Management (May 15 to October 15) California sea lion (potential to encounter once per event) 1 6 6 Northern elephant seal (potential to encounter once per event) 1 6 6 Artificial Breaching California sea lion (potential to encounter once per month, Oct-May) 1 8 8 Northern elephant seal (potential to encounter once per month, Oct-May) 1 8 8 Topographic and Geophysical Beach Surveys California sea lion (potential to encounter once per month year-round for topographical surveys) 1 12 12 Northern elephant seal (potential to encounter once per month year-round for topographical surveys) 1 12 12 Biological and Physical Habitat Monitoring in the Estuary California sea lion (potential to encounter once per month, Jul-Feb) 1 8 8 Northern elephant seal
  • (potential to encounter once per month, Jul-Feb)
  • 1 8 8
    Total California sea lion 34 Elephant seal 34 a SCWA expects that California sea lions and/or northern elephant seals could occur during any month of the year, but that any such occurrence would be infrequent and unlikely to occur more than once per month.
    Analyses and Preliminary Determinations Negligible Impact Analysis

    NMFS has defined “negligible impact” in 50 CFR 216.103 as “. . . an impact resulting from the specified activity that cannot be reasonably expected to, and is not reasonably likely to, adversely affect the species or stock through effects on annual rates of recruitment or survival.” A negligible impact finding is based on the lack of likely adverse effects on annual rates of recruitment or survival (i.e., population-level effects). An estimate of the number of Level B harassment takes alone is not enough information on which to base an impact determination. In addition to considering estimates of the number of marine mammals that might be “taken” through behavioral harassment, we consider other factors, such as the likely nature of any responses (e.g., intensity, duration), the context of any responses (e.g., critical reproductive time or location, migration), as well as the number and nature of estimated Level A harassment takes, the number of estimated mortalities, and effects on habitat.

    Although SCWA's estuary management activities may disturb pinnipeds hauled out at the mouth of the Russian River, as well as those hauled out at several locations in the estuary during recurring monitoring activities, impacts are occurring to a small, localized group of animals. While these impacts can occur year-round, they occur sporadically and for limited duration (e.g., a maximum of two consecutive days for water level management events). Seals will likely become alert or, at most, flush into the water in reaction to the presence of crews and equipment on the beach. While disturbance may occur during a sensitive time (during the March 15-June 30 pupping season), mitigation measures have been specifically designed to further minimize harm during this period and eliminate the possibility of pup injury or mother-pup separation.

    No injury, serious injury, or mortality is anticipated, nor is the proposed action likely to result in long-term impacts such as permanent abandonment of the haul-out. Injury, serious injury, or mortality to pinnipeds would likely result from startling animals inhabiting the haul-out into a stampede reaction, or from extended mother-pup separation as a result of such a stampede. Long-term impacts to pinniped usage of the haul-out could result from significantly increased presence of humans and equipment on the beach. To avoid these possibilities, we have worked with SCWA to develop the previously described mitigation measures. These are designed to reduce the possibility of startling pinnipeds, by gradually apprising them of the presence of humans and equipment on the beach, and to reduce the possibility of impacts to pups by eliminating or altering management activities on the beach when pups are present and by setting limits on the frequency and duration of events during pupping season. During the past fifteen years of flood control management, implementation of similar mitigation measures has resulted in no known stampede events and no known injury, serious injury, or mortality. Over the course of that time period, management events have generally been infrequent and of limited duration.

    No pinniped stocks for which incidental take authorization is proposed are listed as threatened or endangered under the ESA or determined to be strategic or depleted under the MMPA. Recent data suggests that harbor seal populations have reached carrying capacity; populations of California sea lions and northern elephant seals in California are also considered healthy.

    In summary, and based on extensive monitoring data, we believe that impacts to hauled-out pinnipeds during estuary management activities would be behavioral harassment of limited duration (i.e., less than one day) and limited intensity (i.e., temporary flushing at most). Stampeding, and therefore injury or mortality, is not expected—nor been documented—in the years since appropriate protocols were established (see “Mitigation” for more details). Further, the continued, and increasingly heavy (Figure 4; SCWA, 2015), use of the haul-out despite decades of breaching events indicates that abandonment of the haul-out is unlikely. Based on the analysis contained herein of the likely effects of the specified activity on marine mammals and their habitat, and taking into consideration the implementation of the proposed monitoring and mitigation measures, we preliminarily find that the total marine mammal take from SCWA's estuary management activities will have a negligible impact on the affected marine mammal species or stocks.

    Small Numbers Analysis

    The proposed number of animals taken for each species of pinnipeds can be considered small relative to the population size. There are an estimated 30,968 harbor seals in the California stock, 296,750 California sea lions, and 179,000 northern elephant seals in the California breeding population. Based on extensive monitoring effort specific to the affected haul-out and historical data on the frequency of the specified activity, we are proposing to authorize take, by Level B harassment only, of 3,976 harbor seals, 34 California sea lions, and 34 northern elephant seals, representing 12.8, 0.01, and 0.02 percent of the populations, respectively. However, this represents an overestimate of the number of individuals harassed over the duration of the proposed IHA, because these totals represent much smaller numbers of individuals that may be harassed multiple times. Based on the analysis contained herein of the likely effects of the specified activity on marine mammals and their habitat, and taking into consideration the implementation of the mitigation and monitoring measures, we preliminarily find that small numbers of marine mammals will be taken relative to the populations of the affected species or stocks.

    Impact on Availability of Affected Species for Taking for Subsistence Uses

    There are no relevant subsistence uses of marine mammals implicated by this action. Therefore, we have determined that the total taking of affected species or stocks would not have an unmitigable adverse impact on the availability of such species or stocks for taking for subsistence purposes.

    Endangered Species Act (ESA)

    No species listed under the ESA are expected to be affected by these activities. Therefore, we have determined that a section 7 consultation under the ESA is not required. As described elsewhere in this document, SCWA and the Corps consulted with NMFS under section 7 of the ESA regarding the potential effects of their operations and maintenance activities, including SCWA's estuary management program, on ESA-listed salmonids. As a result of this consultation, NMFS issued the Russian River Biological Opinion (NMFS, 2008), including Reasonable and Prudent Alternatives, which prescribes modifications to SCWA's estuary management activities. The effects of the proposed activities and authorized take would not cause additional effects for which section 7 consultation would be required.

    National Environmental Policy Act (NEPA)

    In compliance with the National Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.), as implemented by the regulations published by the Council on Environmental Quality (40 CFR parts 1500-1508), and NOAA Administrative Order 216-6, we prepared an Environmental Assessment (EA) to consider the direct, indirect and cumulative effects to the human environment resulting from issuance of the original IHA to SCWA for the specified activities and found that it would not result in any significant impacts to the human environment. We signed a Finding of No Significant Impact (FONSI) on March 30, 2010. We have reviewed SCWA's application for a renewed IHA for ongoing estuary management activities for 2015 and the 2014 monitoring report. Based on that review, we have determined that the proposed action follows closely the IHAs issued and implemented in 2010-14 and does not present any substantial changes, or significant new circumstances or information relevant to environmental concerns which would require a supplement to the 2010 EA or preparation of a new NEPA document. Therefore, we have preliminarily determined that a new or supplemental EA or Environmental Impact Statement is unnecessary, and will, after review of public comments determine whether or not to reaffirm its FONSI. The 2010 EA is available for review at www.nmfs.noaa.gov/pr/permits/incidental/construction.htm.

    Proposed Authorization

    As a result of these preliminary determinations, we propose to issue an IHA to SCWA for conducting the described estuary management activities in Sonoma County, California, for one year from the date of issuance, provided the previously mentioned mitigation, monitoring, and reporting requirements are incorporated. The proposed IHA language is provided next.

    This section contains a draft of the IHA itself. The wording contained in this section is proposed for inclusion in the IHA (if issued).

    The Sonoma County Water Agency (SCWA), California, is hereby authorized under section 101(a)(5)(D) of the Marine Mammal Protection Act (MMPA; 16 U.S.C. 1371(a)(5)(D)) to harass marine mammals incidental to conducting estuary management activities in the Russian River, Sonoma County, California.

    1. This Incidental Harassment Authorization (IHA) is valid from April 21, 2015 through April 20, 2016.

    2. This IHA is valid only for activities associated with estuary management activities in the Russian River, Sonoma County, California, including:

    (a) Lagoon outlet channel management;

    (b) Artificial breaching of barrier beach;

    (c) Geophysical surveys and other work associated with a jetty study; and

    (d) Physical and biological monitoring of the beach and estuary as required.

    3. General Conditions:

    (a) A copy of this IHA must be in the possession of SCWA, its designees, and work crew personnel operating under the authority of this IHA.

    (b) SCWA is hereby authorized to incidentally take, by Level B harassment only, 3,976 harbor seals (Phoca vitulina richardii), 34 California sea lions (Zalophus californianus), and 34 northern elephant seals (Mirounga angustirostris).

    (c) The taking by injury (Level A harassment), serious injury, or death of any of the species listed in condition 3(b) of the Authorization or any taking of any other species of marine mammal is prohibited and may result in the modification, suspension, or revocation of this IHA.

    (d) If SCWA observes a pup that may be abandoned, it shall contact the National Marine Fisheries Service (NMFS) West Coast Regional Stranding Coordinator immediately (562-980-3230; [email protected]) and also report the incident to NMFS Office of Protected Resources (301-427-8425; [email protected]) within 48 hours. Observers shall not approach or move the pup.

    4. Mitigation Measures:

    In order to ensure the least practicable impact on the species listed in condition 3(b), the holder of this Authorization is required to implement the following mitigation measures:

    (a) SCWA crews shall cautiously approach the haul-out ahead of heavy equipment to minimize the potential for sudden flushes, which may result in a stampede—a particular concern during pupping season.

    (b) SCWA staff shall avoid walking or driving equipment through the seal haul-out.

    (c) Crews on foot shall make an effort to be seen by seals from a distance, if possible, rather than appearing suddenly at the top of the sandbar, again preventing sudden flushes.

    (d) During breaching events, all monitoring shall be conducted from the overlook on the bluff along Highway 1 adjacent to the haul-out in order to minimize potential for harassment.

    (e) A water level management event may not occur for more than two consecutive days unless flooding threats cannot be controlled.

    (f) Equipment shall be driven slowly on the beach and care will be taken to minimize the number of shut-downs and start-ups when the equipment is on the beach.

    (g) All work shall be completed as efficiently as possible, with the smallest amount of heavy equipment possible, to minimize disturbance of seals at the haul-out.

    (h) Boats operating near river haul-outs during monitoring shall be kept within posted speed limits and driven as far from the haul-outs as safely possible to minimize flushing seals.

    In addition, SCWA shall implement the following mitigation measures during pupping season (March 15-June 30):

    (i) SCWA shall maintain a one week no-work period between water level management events (unless flooding is an immediate threat) to allow for an adequate disturbance recovery period. During the no-work period, equipment must be removed from the beach.

    (j) If a pup less than one week old is on the beach where heavy machinery will be used or on the path used to access the work location, the management action shall be delayed until the pup has left the site or the latest day possible to prevent flooding while still maintaining suitable fish rearing habitat. In the event that a pup remains present on the beach in the presence of flood risk, SCWA shall consult with NMFS and CDFG to determine the appropriate course of action. SCWA shall coordinate with the locally established seal monitoring program (Stewards of the Coast and Redwoods) to determine if pups less than one week old are on the beach prior to a breaching event.

    (k) Physical and biological monitoring shall not be conducted if a pup less than one week old is present at the monitoring site or on a path to the site.

    5. Monitoring:

    The holder of this Authorization is required to conduct baseline monitoring and shall conduct additional monitoring as required during estuary management activities. Monitoring and reporting shall be conducted in accordance with the approved Pinniped Monitoring Plan.

    (a) Baseline monitoring shall be conducted twice-monthly for the term of the IHA. These censuses shall begin at dawn and continue for eight hours, weather permitting; the census days shall be chosen to ensure that monitoring encompasses a low and high tide each in the morning and afternoon. All seals hauled out on the beach shall be counted every thirty minutes from the overlook on the bluff along Highway 1 adjacent to the haul-out using high-powered spotting scopes. Observers shall indicate where groups of seals are hauled out on the sandbar and provide a total count for each group. If possible, adults and pups shall be counted separately.

    (b) In addition, peripheral haul-outs shall be visited for ten-minute counts twice during each baseline monitoring day.

    (c) During estuary management events, monitoring shall occur on all days that activity is occurring using the same protocols as described for baseline monitoring, with the difference that monitoring shall begin at least one hour prior to the crew and equipment accessing the beach work area and continue through the duration of the event, until at least one hour after the crew and equipment leave the beach. In addition, a one-day pre-event survey of the area shall be made within one to three days of the event and a one-day post-event survey shall be made after the event, weather permitting.

    (d) Monitoring of peripheral haul-outs shall occur concurrently with event monitoring, when possible.

    (e) For all monitoring, the following information shall be recorded in thirty-minute intervals:

    i. Pinniped counts by species;

    ii. Behavior;

    iii. Time, source and duration of any disturbance, with takes incidental to SCWA actions recorded only for responses involving movement away from the disturbance or responses of greater intensity (e.g., not for alerts);

    iv. Estimated distances between source of disturbance and pinnipeds;

    v. Weather conditions (e.g., temperature, percent cloud cover, and wind speed); and

    vi. Tide levels and estuary water surface elevation.

    (a) All monitoring during pupping season shall include records of any neonate pup observations. SCWA shall coordinate with the Stewards' monitoring program to determine if pups less than one week old are on the beach prior to a water level management event.

    6. Reporting:

    The holder of this Authorization is required to:

    (a) Submit a report on all activities and marine mammal monitoring results to the Office of Protected Resources, NMFS, and the West Coast Regional Administrator, NMFS, 90 days prior to the expiration of the IHA if a renewal is sought, or within 90 days of the expiration of the permit otherwise. This report must contain the following information:

    i. The number of seals taken, by species and age class (if possible);

    ii. Behavior prior to and during water level management events;

    iii. Start and end time of activity;

    iv. Estimated distances between source and seals when disturbance occurs;

    v. Weather conditions (e.g., temperature, wind, etc.);

    vi. Haul-out reoccupation time of any seals based on post-activity monitoring;

    vii. Tide levels and estuary water surface elevation;

    viii. Seal census from bi-monthly and nearby haul-out monitoring; and

    ix. Specific conclusions that may be drawn from the data in relation to the four questions of interest in SCWA's Pinniped Monitoring Plan, if possible.

    (b) Reporting injured or dead marine mammals:

    i. In the unanticipated event that the specified activity clearly causes the take of a marine mammal in a manner prohibited by this IHA, such as an injury (Level A harassment), serious injury, or mortality, SCWA shall immediately cease the specified activities and report the incident to the Office of Protected Resources, NMFS, and the West Coast Regional Stranding Coordinator, NMFS. The report must include the following information:

    A. Time and date of the incident;

    B. Description of the incident;

    C. Environmental conditions (e.g., wind speed and direction, Beaufort sea state, cloud cover, and visibility);

    D. Description of all marine mammal observations in the 24 hours preceding the incident;

    E. Species identification or description of the animal(s) involved;

    F. Fate of the animal(s); and

    G. Photographs or video footage of the animal(s).

    Activities shall not resume until NMFS is able to review the circumstances of the prohibited take. NMFS will work with SCWA to determine what measures are necessary to minimize the likelihood of further prohibited take and ensure MMPA compliance. SCWA may not resume their activities until notified by NMFS.

    i. In the event that SCWA discovers an injured or dead marine mammal, and the lead observer determines that the cause of the injury or death is unknown and the death is relatively recent (e.g., in less than a moderate state of decomposition), SCWA shall immediately report the incident to the Office of Protected Resources, NMFS, and the West Coast Regional Stranding Coordinator, NMFS.

    The report must include the same information identified in 6(b)(i) of this IHA. Activities may continue while NMFS reviews the circumstances of the incident. NMFS will work with SCWA to determine whether additional mitigation measures or modifications to the activities are appropriate.

    ii. In the event that SCWA discovers an injured or dead marine mammal, and the lead observer determines that the injury or death is not associated with or related to the activities authorized in the IHA (e.g., previously wounded animal, carcass with moderate to advanced decomposition, or scavenger damage), SCWA shall report the incident to the Office of Protected Resources, NMFS, and the West Coast Regional Stranding Coordinator, NMFS, within 24 hours of the discovery. SCWA shall provide photographs or video footage or other documentation of the stranded animal sighting to NMFS.

    iii. Pursuant to sections 6(b)(ii-iii), SCWA may use discretion in determining what injuries (i.e., nature and severity) are appropriate for reporting. At minimum, SCWA must report those injuries considered to be serious (i.e., will likely result in death) or that are likely caused by human interaction (e.g., entanglement, gunshot). Also pursuant to sections 6(b)(ii-iii), SCWA may use discretion in determining the appropriate vantage point for obtaining photographs of injured/dead marine mammals.

    7. Validity of this Authorization is contingent upon compliance with all applicable statutes and permits, including NMFS' 2008 Biological Opinion for water management in the Russian River watershed. This Authorization may be modified, suspended or withdrawn if the holder fails to abide by the conditions prescribed herein, or if the authorized taking is having a more than a negligible impact on the species or stock of affected marine mammals.

    Request for Public Comments

    We request comment on our analysis, the draft authorization, and any other aspect of this Notice of Proposed IHA for SCWA's estuary management activities. Please include with your comments any supporting data or literature citations to help inform our final decision on SCWA's request for an MMPA authorization.

    Dated: March 13, 2015. Perry Gayaldo, Deputy Director, Office of Protected Resources, National Marine Fisheries Service.
    [FR Doc. 2015-06236 Filed 3-17-15; 8:45 am] BILLING CODE 3510-22-P
    DEPARTMENT OF COMMERCE International Trade Administration [C-570-911] Circular Welded Carbon-Quality Steel Pipe From the People's Republic of China: Rescission of Countervailing Duty Administrative Review; 2013 AGENCY:

    Enforcement and Compliance, International Trade Administration, Department of Commerce.

    SUMMARY:

    The Department of Commerce (the Department) is rescinding the administrative review of the countervailing duty (CVD) order on circular welded carbon-quality steel pipe (CWP) from the People's Republic of China (PRC) for the period January 1, 2013, through December 31, 2013.

    DATES:

    Effective Date: March 18, 2015.

    FOR FURTHER INFORMATION CONTACT:

    Mary Kolberg, AD/CVD Operations, Office I, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue NW., Washington, DC 20230; telephone: (202) 482-1785.

    Background

    On August 29, 2014, the Department initiated an administrative review of the CVD order on CWP from the PRC with respect to Baoshan Iron & Steel Co., Ltd., Beijing Jia Mei AO Trade Co., Ltd., Beijing Jinghua Global Trading Co., Benxi Northern Steel Pipes, Co. Ltd., CNOOC Kingland Pipeline Co., Ltd., ETCO (China) International Trading Co., Ltd., Guangzhou Juyi Steel Pipe Co., Ltd., Huludao City Steel Pipe Industrial, Jiangsu Changbao Steel Tube Co., Ltd., Jiangsu Yulong Steel Pipe Co., Ltd., Liaoning Northern Steel Pipe Co., Ltd., Pangang Chengdu Group Iron & Steel Co., Ltd., Shanghai Zhongyou TIPO Steel Pipe Co., Ltd., Tianjin Haoyou Industry Trade Co., Tianjin Longshenghua Import & Export, Tianjin Shuangjie Steel Pipe Co., Ltd., Weifang East Steel Pipe Co., Ltd., WISCO & CRM Wuhan Materials & Trade., and Zhejiang Kingland Pipeline Industry Co., Ltd., covering the period January 1, 2013, through December 31, 2013, based on a request by Wheatland Tube Company (hereinafter, the petitioner).1 On November 21, 2014, the petitioner timely withdrew its request for an administrative review of the above-listed companies.2 No other party requested a review.

    1See Initiation of Antidumping and Countervailing Duty Administrative Reviews, 79 FR 51548 (August 29, 2014); see also Letter from petitioner, Re: “Circular Welded Carbon Quality Steel Pipe From The People's Republic of China: Request For Administrative Review” (July 31, 2014).

    2See Letter from petitioner, Re: “Circular Welded Carbon Quality Steel Pipe From The People's Republic of China: Withdrawal of Request For Administrative Review” (November 21, 2014).

    Rescission of Review

    Pursuant to 19 CFR 351.213(d)(1), the Department will rescind an administrative review, in whole or in part, if the party that requested the review withdraws its request within 90 days of the publication of the notice of initiation of the requested review. In this case, the petitioner withdrew its request within the 90-day deadline, and no other party requested an administrative review of the CVD order. Therefore, in accordance with 19 CFR 351.213(d)(1), we are rescinding the administrative review of CWP from the PRC covering the period January 1, 2013, through December 31, 2013, in its entirety.

    Assessment

    The Department will instruct U.S. Customs and Border Protection (CBP) to assess CVDs on all entries of CWP from the PRC made during the period of review at rates equal to the cash deposit of estimated CVDs required at the time of entry, or withdrawal from warehouse, for consumption, in accordance with 19 CFR 351.212(c)(1)(i). The Department intends to issue appropriate assessment instructions to CBP 15 days after the date of publication of this notice in the Federal Register.

    Notifications

    This notice serves as a final reminder to parties subject to administrative protective order (APO) of their responsibility concerning the return or destruction of proprietary information disclosed under APO in accordance with 19 CFR 351.305(a)(3). Timely written notification of the return or destruction of APO materials, or conversion to judicial protective order, is hereby requested. Failure to comply with the regulations and terms of an APO is a violation that is subject to sanction.

    This notice is issued and published in accordance with sections 751(a)(1) and 777(i)(1) of the Tariff Act of 1930, as amended, and 19 CFR 351.213(d)(4).

    Dated: March 11, 2015. Christian Marsh, Deputy Assistant Secretary for Antidumping and Countervailing Duty Operations.
    [FR Doc. 2015-06237 Filed 3-17-15; 8:45 am] BILLING CODE 3510-DS-P
    DEPARTMENT OF COMMERCE International Trade Administration United States Manufacturing Council: Meeting of the United States Manufacturing Council AGENCY:

    International Trade Administration, U.S. Department of Commerce.

    ACTION:

    Notice of an open meeting.

    SUMMARY:

    The United States Manufacturing Council (Council) will hold the first meeting of the current members' term on Wednesday, April 1, 2015. The Council was established in April 2004 to advise the Secretary of Commerce on matters relating to the manufacturing industry.

    The purpose of the meeting is to brief Council members on current manufacturing initiatives throughout the Federal government. The Council will receive briefings from various leaders across the Department who are actively engaged in different aspects of manufacturing policy. The Council will also receive briefings from senior officials of related government agencies such as the Department of Labor. The Secretary of Commerce has been invited to welcome the Council and provided introductory remarks. Following the briefings, the Council members will be asked to discuss their views on major priorities facing the manufacturing industry and issues that they propose for the Council to advise on during their appointment term. The agenda may change to accommodate Council business. The final agenda will be posted on the Department of Commerce Web site for the Council at http://trade.gov/manufacturingcouncil, at least one week in advance of the meeting.

    DATES:

    Wednesday, April 1, 2015, 8:30 a.m.-11:30 a.m. The deadline for members of the public to register, including requests to make comments during the meetings and for auxiliary aids, or to submit written comments for dissemination prior to the meeting, is 5 p.m. EDT on March 23, 2015.

    ADDRESSES:

    U.S. Manufacturing Council, U.S. Department of Commerce, Room 4043, 1401 Constitution Avenue NW., Washington, DC 20230, [email protected]. Members of the public are encouraged to submit registration requests and written comments via email to ensure timely receipt.

    FOR FURTHER INFORMATION CONTACT:

    Niara Phillips, the United States Manufacturing Council, Room 4043, 1401 Constitution Avenue NW., Washington, DC 20230, telephone: 202-482-4501, email: [email protected].

    SUPPLEMENTARY INFORMATION:

    Background: The Council advises the Secretary of Commerce on matters relating to the U.S. manufacturing industry.

    Public Participation: The meeting will be open to the public and will be physically accessible to people with disabilities. All guests are required to register in advance by the deadline identified under the DATES caption. The meeting room will be provided upon registration. Seating is limited and will be on a first come, first served basis. Requests for sign language interpretation or other auxiliary aids must be submitted by the registration deadline. Last minute requests will be accepted, but may be impossible to fill. There will be fifteen (15) minutes allotted for oral comments from members of the public attending the meeting. To accommodate as many speakers as possible, the time for public comments will be limited to three (3) minutes per person. Individuals wishing to reserve speaking time during the meeting must submit a request at the time of registration along with a brief statement of the general nature of the comments, as well as the name and address of the proposed speaker. If the number of registrants requesting to make statements is greater than can be reasonably accommodated during the meeting, the International Trade Administration may conduct a lottery to determine the speakers. Speakers are requested to bring at least 25 copies of their oral comments for distribution to the members of the Manufacturing Council and to the public at the meeting.

    In addition, any member of the public may submit pertinent written comments concerning the Council's affairs at any time before or after the meeting. Comments may be submitted to Niara Phillips at the contact information indicated above. To be considered during the meeting, comments must be received no later than 5:00 p.m. EDT on March 23, 2015, to ensure transmission to the Council prior to the meeting. Comments received after that date will be distributed to the members but may not be considered at the meeting. Copies of Council meeting minutes will be available within 90 days of the meeting.

    Dated: March 11, 2015. Niara Phillips, Executive Secretary, United States Manufacturing Council.
    [FR Doc. 2015-06111 Filed 3-17-15; 8:45 am] BILLING CODE 3510-DR-P
    DEPARTMENT OF COMMERCE International Trade Administration [Application No. 14-00004] Export Trade Certificate of Review ACTION:

    Notice of Issuance of an Export Trade Certificate of Review to DFA of California, Application no. 14-00004.

    SUMMARY:

    The Secretary of Commerce, through the Office of Trade and Economic Analysis (“OTEA”) of the International Trade Administration, Department of Commerce, issued an Export Trade Certificate of Review to DFA of California on March 2, 2015.

    FOR FURTHER INFORMATION CONTACT:

    Joseph Flynn, Director, Office of Trade and Economic Analysis, International Trade Administration, (202) 482-5131 (this is not a toll-free number) or email at [email protected]

    SUPPLEMENTARY INFORMATION:

    Title III of the Export Trading Company Act of 1982 (15 U.S.C. 4001-21) authorizes the Secretary of Commerce to issue Export Trade Certificates of Review. An Export Trade Certificate of Review protects the holder and the members identified in the Certificate from State and Federal government antitrust actions and from private treble damage antitrust actions for the export conduct specified in the Certificate and carried out in compliance with its terms and conditions. Section 302(b)(1) of the Export Trading Company Act of 1982 and 15 CFR 325.6(a) require the Secretary to publish a notice in the Federal Register identifying the applicant and summarizing its proposed export conduct.

    Members (within the meaning of 15 CFR 325.2(1)) 1. Alpine Pacific Nut Company (Hughson, CA) 2. Andersen & Sons Shelling (Vina, CA) 3. Avanti Nut Company, Inc. (Stockton, CA) 4. Berberian Nut Company, LLC (Chico, CA) 5. Carriere Family Farms, Inc. (Glenn, CA) 6. Continente Nut LLC (Oakley, CA) 7. Crain Walnut Shelling, Inc. (Los Molinos, CA) 8. Crisp California Walnuts (Stratford, CA) 9. Diamond Foods, Inc. (Stockton, CA) 10. Empire Nut Company (Colusa, CA) 11. Gold River Orchards, Inc. (Escalon, CA) 12. Grower Direct Nut Company (Hughson, CA) 13. GSF Nut Company (Orosi, CA) 14. Guerra Nut Shelling Company (Hollister, CA) 15. Hill View Packing Company Inc. (Gustine, CA) 16. Linden Nut Company (Linden, CA) 17. Mariani Nut Company (Winters, CA) 18. Mariani Packing Company, Inc. (Vacaville, CA) 19. Mid Valley Nut Company Inc. (Hughson, CA) 20. National Raisin Company (Fowler, CA) 21. Poindexter Nut Company (Selma, CA) 22. Prima Noce Packing (Linden, CA) 23. Sacramento Packing, Inc. (Yuba City, CA) 24. Sacramento Valley Walnut Growers, Inc. (Yuba City, CA) 25. San Joaquin Figs, Inc. (Fresno, CA) 26. Shoei Foods USA, Inc. (Olivehurst, CA) 27. Stapleton-Spence Packing (Gridley, CA) 28. Sunsweet Growers Inc. (Yuba City, CA) 29. T.M. Duche Nut Company, Inc. (Orland, CA) 30. Wilbur Packing Company, Inc. (Live Oak, CA) 31. Valley Fig Growers (Fresno, CA) Description of Certified Conduct

    DFA of California (“DFA”) is certified to engage in the Export Trade Activities and Methods of Operation described below in the following Export Trade and Export Markets.

    Export Trade

    Products: California Figs, Prunes, and Walnuts in processed and unprocessed form.

    Export Trade Facilitation Services (as They Relate to the Export of Products): All export trade-related facilitation services, including but not limited to: development of trade strategy; sales, marketing, and distribution; foreign market development; export promotion; and services related to trade documentation, foreign exchange, customs, duties, taxes, inspection, and quality control.

    Export Markets

    The Export Markets include all parts of the world except the United States (the fifty states of the United States, the District of Columbia, the Commonwealth of Puerto Rico, the Virgin Islands, American Samoa, Guam, the Commonwealth of the Northern Mariana Islands, and the Trust Territory of the Pacific Islands).

    Export Trade Activities and Methods of Operations

    For purposes of the Certificate of Review, “members” and “membership” refer to members of and membership in DFA of California; and “Members” and “Membership” refer to Members under the Certificate within the meaning of 15 CFR 325.2(1).

    1. To engage in Export Trade in the Export Markets, DFA and Members may, subject to the Terms and Conditions below, exchange and discuss the following information:

    a. Information about expenses specific to exporting to and within the Export Markets, including without limitation, transportation, transmodal or intermodal shipments, insurance, inland freight to port, port storage, commissions, export sales, documentation, financing, customs, duties and taxes;

    b. Information about U.S. and foreign legislation and regulations, including federal marketing order programs, affecting sales of Products for the Export Markets;

    c. Information about DFA's or its Members' export operations, including without limitation, sales and distribution networks established by DFA or its Members in the Export Markets;

    d. Information about the credit terms extended to, and credit history of, export customers.

    2. To engage in Export Trade in the Export Markets, DFA and its Members may, subject to the Terms and Conditions below, and further subject to the condition that the information is either (1) publicly available, or (2) if not publicly available, then compiled and distributed only in aggregate and summary form, by a person who is not employed by, nor affiliated with, a Processor or Packer, and in a manner that does not disclose either directly or by inference information about a transaction of any specific Member, exchange and discuss the following information:

    a. With respect to the Export Markets, information about sales and marketing efforts, activities and opportunities for sales of Products, selling strategies, sales contracts, pricing, projected demand, customary terms of sale, and specifications for Products by customers in the Export Markets;

    b. With respect to Products available from Members for export, information about price, quality, and quantity; and

    c. Information about prior export sales by Members, including export prices.

    3. DFA and its Members may meet to engage in the activities described in paragraphs 1 and 2 above.

    4. DFA and its Members may prescribe the following conditions for admission and termination of members of DFA as participants in the Export Trade Activities and Methods of Operation and as Members of the Certificate (within the meaning of 15 CFR 325.2(1)) (“Membership”):

    a. DFA may limit Membership to Fig, Prune, or Walnut Processors or Packers as defined under “Definitions.”

    b. DFA may terminate Membership on the occurrence of one or more of the following events:

    i. Withdrawal or resignation of a Member;

    ii. Expulsion approved by a majority of all Members for a material violation of DFA's by-laws, after prior written notice to the Member proposed to be expelled and an opportunity of such Member to appear and be heard before a meeting of the Members;

    iii. Death or permanent disability of a Member who is an individual or the dissolution of a Member other than an individual; or

    iv. The bankruptcy of a Member, as provided in DFA's by-laws.

    5. DFA and its Members may establish the following Minimum Qualifications for Members to participate in the DFA's Export Committees for Figs, Natural Condition Prunes, Prune Processors and Walnuts. There are no additional requirements for participation in the Fig and Walnut Export Committees.

    a. A participant in any of the Export Committees must be:

    i. A DFA Member;

    ii. Owner of a commercially viable processing facility;

    iii. In good standing with DFA credit terms (Payment net 30); and

    iv. With personal and business conduct consistent with the highest industry standards as necessary to protect the integrity of the committee.

    b. Fig Export Committee: A participant must meet the Minimum Qualifications.

    c. Natural Condition Prune Export Committee: In addition to meeting the Minimum Qualifications, participation in this export committee requires that the Member be a packer of natural condition prunes for export.

    d. Prune Processor Export Committee:

    i. In addition to meeting the Minimum Qualifications, participation in this export committee requires that the Member be a processor of processed prunes for export;

    ii. Participation also requires that the Member has the capability to thermally process and pack fruit into a consumer-ready product to a minimum 25% moisture level suitable for end user consumption.

    e. Walnut Export Committee: A participant must meet the Minimum Qualifications.

    6. Export Committees can elect to have guest speakers (such as economists, university professors, or researchers) present relevant industry information during the meetings.

    Definition

    1. “Processor or Packer” means a person or entity that processes or packs figs, prunes or walnuts grown in California.

    2. “Member” means the Members of DFA listed in Attachment A and any other members of DFA added as Members under the Certificate through amendment of the Certificate.

    3. “Natural Condition Prunes” means prunes (with pits) in the condition in which they are normally delivered from a dry yard or dehydrator and may include:

    a. Prunes which have been washed but which retain natural condition;

    b. Prunes which will permit normal bulk storage without adding a preservative;

    c. Prunes which will permit normal bulk storage without adding a preservative;

    d. Prunes which have been size graded;

    e. Prunes which may have been processed and re-dried to acceptable natural condition moisture content; and

    f. Prunes in which the average moisture content of a lot is 21% or less.

    4. “Processed Prunes” means prunes which have been thermally processed (e.g., treated with hot water or steam) in the course of their preparation for packaging to the extent that their condition no longer meets the definition of “natural condition.”

    Terms and Conditions of the Certificate

    1. Neither DFA nor any Member shall intentionally disclose, directly or indirectly, to DFA or to any other Member any information about its own or any other Member's costs, output, capacity, inventories, domestic prices, domestic sales, domestic orders, terms of domestic marketing or sale, U.S. business plans, strategies, or methods that is (1) not already generally available to the trade or public; or (2) made in connection with the administration of a United States Department of Agriculture marketing order for any Product.

    2. Meetings at which DFA Members discuss the information under paragraphs 1 of the Export Trade Activities and Methods of Operations above shall not be open to the public.

    3. Participation by a Member in any Export Trade Activity or Method of Operation under this Certificate shall be entirely voluntary as to that Member. A Member may withdraw from Membership under this Certificate at any time by giving a written notice to DFA, a copy of which DFA shall promptly transmit to the Secretary of Commerce and the Attorney General.

    4. DFA and its Members will comply with requests made by the Secretary of Commerce, on behalf of the Secretary or the Attorney General, for information or documents relevant to conduct under the Certificate. The Secretary of Commerce will request such information or documents when either the Attorney General or the Secretary believes that the information or documents are required to determine that the Export Trade, Export Trade Activities and methods of Operation of a person protected by this Certificate of Review continue to comply with the standards of section 303(a) of the Act.

    Dated: March 12, 2015. Anne Flatness, Acting Director, Office of Trade and Economic Analysis, International Trade Administration.
    [FR Doc. 2015-06248 Filed 3-17-15; 8:45 am] BILLING CODE 3510-DR-P
    DEPARTMENT OF COMMERCE National Oceanic and Atmospheric Administration RIN 0648-XD831 Western Pacific Fishery Management Council; Public Meetings AGENCY:

    National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.

    ACTION:

    Notice of public meeting.

    SUMMARY:

    The Western Pacific Fishery Management Council (Council) will hold a meeting of its Scientific and Statistical Committee (SSC) subcommittee to review and discuss the revisions of false killer whale stock boundaries and bycatch proration method for incidental take in the Hawaii longline fishery.

    DATES:

    The SSC subcommittee meeting will be held on March 31, 2015 at 1 p.m.

    ADDRESSES:

    The SSC subcommittee meeting will be held at the Council office, 1164 Bishop Street, Suite 1400, Honolulu, HI 96813; telephone: (808) 522-8220.

    FOR FURTHER INFORMATION CONTACT:

    Kitty M. Simonds, Executive Director; telephone: (808) 522-8220.

    SUPPLEMENTARY INFORMATION:

    Public comment opportunity will be provided. The order in which agenda items are addressed may change. The meetings will run as late as necessary to complete scheduled business.

    Schedule and Agenda for the SSC Subcommittee Meeting 1. Welcome and Introductions 2. Approval of the Agenda 3. False Killer Whale Stock Boundary and Bycatch Proration A. Revised Stock Boundaries for False Killer Whales in Hawaiian Waters B. Revised Bycatch Proration C. Discussions 4. Public Comment 5. Discussion and Recommendations Special Accommodations

    These meetings are physically accessible to people with disabilities. Requests for sign language interpretation or other auxiliary aids should be directed to Kitty M. Simonds, (808) 522-8220 (voice) or (808) 522-8226 (fax), at least 5 days prior to the meeting date.

    Authority:

    16 U.S.C. 1801 et seq.

    Dated: March 13, 2015. Tracey L. Thompson, Acting Deputy Director, Office of Sustainable Fisheries, National Marine Fisheries Service.
    [FR Doc. 2015-06200 Filed 3-17-15; 8:45 am] BILLING CODE 3510-22-P
    DEPARTMENT OF COMMERCE Foreign-Trade Zones Board [B-15-2015] Foreign-Trade Zone (FTZ) 44—Mount Olive, New Jersey; Notification of Proposed Production Activity, Givaudan Fragrances Corporation, (Fragrance Compounds), Mount Olive, New Jersey

    Givaudan Fragrances Corporation (Givaudan), an operator of FTZ 44, submitted a notification of proposed production activity to the FTZ Board for its facility located in Mount Olive, New Jersey. The notification conforming to the requirements of the regulations of the FTZ Board (15 CFR 400.22) was received on March 4, 2015.

    Givaudan already has authority to produce fragrance compounds within Site 1 of FTZ 44. The current request would add foreign-status materials to the scope of authority. Pursuant to 15 CFR 400.14(b), additional FTZ authority would be limited to the specific foreign-status materials and components and specific finished products described in the submitted notification (as described below) and subsequently authorized by the FTZ Board.

    Production under FTZ procedures could exempt Givaudan from customs duty payments on the foreign status materials used in export production. On its domestic sales, Givaudan would be able to choose the duty rate during customs entry procedures that applies to fragrance compounds (free) for the foreign status materials noted below and in the existing scope of authority. Customs duties also could possibly be deferred or reduced on foreign status production equipment.

    The components and materials sourced from abroad include: lactic acid salts and esters; tartaric acid salts and esters; and, acridine and indole (duty rate ranges from free to 4.4%).

    Public comment is invited from interested parties. Submissions shall be addressed to the FTZ Board's Executive Secretary at the address below. The closing period for their receipt is April 27, 2015.

    A copy of the notification will be available for public inspection at the Office of the Executive Secretary, Foreign-Trade Zones Board, Room 21013, U.S. Department of Commerce, 1401 Constitution Avenue NW., Washington, DC 20230-0002, and in the “Reading Room” section of the FTZ Board's Web site, which is accessible via www.trade.gov/ftz.

    For further information, contact Kathleen Boyce at [email protected] (202) 482-1346.

    Dated: March 12, 2015. Andrew McGilvray, Executive Secretary.
    [FR Doc. 2015-06271 Filed 3-17-15; 8:45 am] BILLING CODE 3510-DS-P
    DEPARTMENT OF COMMERCE International Trade Administration President's Advisory Council on Doing Business in Africa: Meeting of the President's Advisory Council on Doing Business in Africa AGENCY:

    International Trade Administration, U.S. Department of Commerce.

    ACTION:

    Notice of an Open Meeting.

    SUMMARY:

    The President's Advisory Council on Doing Business in Africa (Council) will hold a meeting to deliberate on recommendations related to strengthening commercial engagement between the United States and Africa. Topics may include: mobilizing capital, risk mitigation, trade facilitation, cold chain development, renewal of the African Growth and Opportunity Act (AGOA), infrastructure development, and developing and marketing export resources for U.S. small- and medium-sized businesses. The final agenda will be posted at least one week in advance of the meeting on the Council's Web site at http://trade.gov/pac-dbia.

    DATES:

    April 8, 2015 at 9:30 a.m. (ET)

    ADDRESSES:

    The President's Advisory Council on Doing Business in Africa meeting will be broadcast via live webcast on the Internet at http://whitehouse.gov/live.

    FOR FURTHER INFORMATION CONTACT:

    Tricia Van Orden, Executive Secretary, President's Advisory Council on Doing Business in Africa, Room 4043, 1401 Constitution Avenue NW., Washington, DC 20230, telephone: 202-482-5876, email: [email protected].

    SUPPLEMENTARY INFORMATION:

    Background: President Barack Obama directed the Secretary of Commerce to establish the President's Advisory Council on Doing Business in Africa by Executive Order No. 13675 dated August 5, 2014. The Council was established by Charter on November 3, 2014, to advise the President, through the Secretary of Commerce, on strengthening commercial engagement between the United States and Africa, with a focus on advancing the President's Doing Business in Africa Campaign as described in the U.S. Strategy Toward Sub-Saharan Africa of June 14, 2012. This Council is established in accordance with the provisions of the Federal Advisory Committee Act (FACA), as amended, 5 U.S.C. App.

    Public Submissions: The public is invited to submit written statements to the President's Advisory Council on Doing Business in Africa. Statements must be received by COB April 3, 2015, by either of the following methods:

    a. Electronic Submissions

    Submit statements electronically to Tricia Van Orden, Executive Secretary, President's Advisory Council on Doing Business in Africa, via email: [email protected].

    b. Paper Submissions

    Send paper statements to Tricia Van Orden, Executive Secretary, President's Advisory Council on Doing Business in Africa, Room 4043, 1401 Constitution Avenue NW., Washington, DC 20230.

    Statements will be provided to the members in advance of the meeting for consideration and also will be posted on the President's Advisory Council on Doing Business in Africa Web site (http://trade.gov/pac-dbia) without change, including any business or personal information provided such as names, addresses, email addresses, or telephone numbers. All statements received, including attachments and other supporting materials, are part of the public record and subject to public disclosure. You should submit only information that you wish to make publicly available.

    Meeting minutes: Copies of the Council's meeting minutes will be available within ninety (90) days of the meeting on the Council's Web site at http://trade.gov/pac-dbia.

    Dated: March 10, 2015. Tricia Van Orden, Executive Secretary, President's Advisory Council on Doing Business in Africa.
    [FR Doc. 2015-06173 Filed 3-17-15; 8:45 am] BILLING CODE 3510-DR-P
    DEPARTMENT OF COMMERCE Economic Development Administration Proposed Information Collection; Comment Request; Requirements for Approved Construction Investments AGENCY:

    Economic Development Administration, Commerce.

    ACTION:

    Notice.

    SUMMARY:

    The Department of Commerce, as part of its continuing effort to reduce paperwork and respondent burden, invites the general public and other Federal agencies to take this opportunity to comment on proposed and/or continuing information collections, as required by the Paperwork Reduction Act of 1995.

    DATES:

    Written comments must be submitted on or before May 18, 2015.

    ADDRESSES:

    Direct all written comments to Jennifer Jessup, Departmental Paperwork Clearance Officer, Department of Commerce, Room 6616, 14th and Constitution Avenue NW., Washington, DC 20230 (or via the Internet at [email protected]).

    FOR FURTHER INFORMATION CONTACT:

    Requests for additional information or copies of the information collection instrument and instructions should be directed to: Philip Saputo, Program Analyst, U.S. Department of Commerce, Economic Development Administration Performance and National Programs Division, 1401 Constitution Avenue NW., Suite 71030, Washington, DC 20230, Phone: 202-400-0662, Email: [email protected].

    SUPPLEMENTARY INFORMATION: I. Abstract

    The mission of the Economic Development Administration (EDA) is to lead the Federal economic agenda by promoting innovation and competitiveness, preparing American regions for growth and success in the worldwide economy. In order to effectively administer and monitor its economic development assistance programs, EDA collects certain information from applications for, and recipients of, EDA investment assistance.

    The Summary of EDA Construction Standards (commonly referred to as the “bluebook”) and the Standard Terms and Conditions for Construction Projects, as well as any special conditions incorporated into the terms and conditions at the time of award, supplement the requirements that apply to EDA-funded construction projects. The information collected is used to monitor recipients' compliance with EDA's statutory and regulatory requirements and specific terms and conditions relating to individual awards. EDA also uses the information requested to analyze and evaluate program performance.

    II. Method of Collection

    Paper and electronic submissions.

    III. Data

    OMB Control Number: 0610-0096.

    Form Number(s): None.

    Type of Review: Regular submission (extension of a currently approved information collection).

    Affected Public: Current recipients of EDA construction (Public Works or Economic Adjustment) assistance, to include (1) cities or other political subdivisions of a state, including a special purpose unit of state or local government engaged in economic or infrastructure development activities, or a consortium of political subdivisions; (2) states; (3) institutions of higher education or a consortium of institutions of higher education; (4) public or private non-profit organizations or associations; (5) District Organizations; and (6) Indian Tribes or a consortia of Indian Tribes.

    Estimated Number of Annual Responses: 4,200.

    Estimated Time per Response: 2 hours.

    Estimated Total Annual Burden Hours: 8,400.

    Estimated Total Annual Cost: $0.

    IV. Request for Comments

    Comments are invited on: (a) Whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information shall have practical utility; (b) the accuracy of the agency's estimate of the burden (including hours and cost) of the proposed collection of information; (c) ways to enhance the quality, utility, and clarity of the information to be collected; and (d) ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques or other forms of information technology.

    Comments submitted in response to this notice will be summarized and/or included in the request for OMB approval of this information collection; they also will become a matter of public record.

    Dated: March 13, 2015. Glenna Mickelson, Management Analyst, Office of the Chief Information Officer.
    [FR Doc. 2015-06192 Filed 3-17-15; 8:45 am] BILLING CODE 3510-24-P
    DEPARTMENT OF COMMERCE Economic Development Administration Proposed Information Collection; Comment Request; Property Management AGENCY:

    Economic Development Administration, Commerce.

    ACTION:

    Notice.

    SUMMARY:

    The Department of Commerce, as part of its continuing effort to reduce paperwork and respondent burden, invites the general public and other Federal agencies to take this opportunity to comment on proposed and/or continuing information collections, as required by the Paperwork Reduction Act of 1995.

    DATES:

    Written comments must be submitted on or before May 18, 2015.

    ADDRESSES:

    Direct all written comments to Jennifer Jessup, Departmental Paperwork Clearance Officer, Department of Commerce, Room 6616, 14th and Constitution Avenue NW., Washington, DC 20230 (or via the Internet at [email protected]).

    FOR FURTHER INFORMATION CONTACT:

    Requests for additional information or copies of the information collection instrument and instructions should be directed to: Philip Saputo, Program Analyst, U.S. Department of Commerce, Economic Development Administration Performance and National Programs Division, 1401 Constitution Avenue NW., Suite 71030, Washington, DC 20230, Phone: 202-400-0662, Email: [email protected].

    SUPPLEMENTARY INFORMATION:

    I. Abstract

    The mission of the Economic Development Administration (EDA) is to lead the Federal economic agenda by promoting innovation and competitiveness, preparing American regions for growth and success in the worldwide economy. In order to effectively administer and monitor its economic development assistance programs, EDA collects certain information from applications for, and recipients of, EDA investment assistance.

    A recipient must request in writing EDA's approval to undertake an incidental use of property acquired or improved with EDA's investment assistance (see 13 CFR 314.3 of EDA's regulations). This collection of information allows EDA to determine whether an incidental use of property acquired or improved with EDA investment assistance is appropriate. If a recipient wishes EDA to release its real property or tangible personal property interests before the expiration of the property's estimated useful life, the recipient must submit a written request to EDA and disclose to EDA the intended future use of the real property or the tangible personal property for which the release is requested (see 13 CFR 314.10 of EDA's regulations). This collection of information allows EDA to determine whether to release its real property or tangible personal property interests.

    II. Method of Collection

    Paper and electronic submissions.

    III. Data

    OMB Control Number: 0610-0103.

    Form Number(s): None.

    Type of Review: Ad hoc submission (only when a recipient makes a request).

    Affected Public: Current recipients of EDA construction (Public Works or Economic Adjustment) assistance, to include (1) cities or other political subdivisions of a state, including a special purpose unit of state or local government engaged in economic or infrastructure development activities, or a consortium of political subdivisions; (2) states; (3) institutions of higher education or a consortium of institutions of higher education; (4) public or private non-profit organizations or associations; (5) District Organizations; and (6) Indian Tribes or a consortia of Indian Tribes.

    Estimated Number of Annual Responses: 150 (54 incidental use requests; 96 for requests to release EDA's Property interest).

    Estimated Time per Response: 45 minutes.

    Estimated Total Annual Burden Hours: 413.

    Estimated Total Annual Cost: $0.

    IV. Request for Comments

    Comments are invited on: (a) Whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information shall have practical utility; (b) the accuracy of the agency's estimate of the burden (including hours and cost) of the proposed collection of information; (c) ways to enhance the quality, utility, and clarity of the information to be collected; and (d) ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques or other forms of information technology.

    Comments submitted in response to this notice will be summarized and/or included in the request for OMB approval of this information collection; they also will become a matter of public record.

    Dated: March 13, 2015. Glenna Mickelson, Management Analyst, Office of the Chief Information Officer.
    [FR Doc. 2015-06193 Filed 3-17-15; 8:45 am] BILLING CODE 3510-24-P
    DEPARTMENT OF EDUCATION Applications for New Awards; Technical Assistance and Dissemination To Improve Services and Results for Children With Disabilities—Model Demonstration Projects To Improve Adolescent Literacy for Students with Disabilities in Middle and High Schools, Grades 6-12 AGENCY:

    Office of Special Education and Rehabilitative Services, Department of Education.

    ACTION:

    Notice.

    Overview Information: Technical Assistance and Dissemination to Improve Services and Results for Children with Disabilities—Model Demonstration Projects to Improve Adolescent Literacy for Students with Disabilities in Middle and High Schools, Grades 6-12.

    Notice inviting applications for new awards for fiscal year (FY) 2015.

    Catalog of Federal Domestic Assistance (CFDA) Number: 84.326M.

    DATES:

    Applications Available: March 18, 2015.

    Deadline for Transmittal of Applications: May 4, 2015.

    Deadline for Intergovernmental Review: July 1, 2015.

    Full Text of Announcement I. Funding Opportunity Description

    Purpose of Program: The purpose of the Technical Assistance and Dissemination to Improve Services and Results for Children with Disabilities program is to promote academic achievement and to improve results for children with disabilities by providing technical assistance (TA), supporting model demonstration projects, disseminating useful information, and implementing activities that are supported by scientifically based research.

    Priority: In accordance with 34 CFR 75.105(b)(2)(v), this priority is from allowable activities specified in the statute or otherwise authorized in the statute (see sections 663 and 681(d) of the Individuals with Disabilities Education Act (IDEA), 20 U.S.C. 1463, 1481(d).

    Absolute Priority: For FY 2015 and any subsequent year in which we make awards from the list of unfunded applicants from this competition, this priority is an absolute priority. Under 34 CFR 75.105(c)(3), we consider only applications that meet this priority.

    This priority is:

    Technical Assistance and Dissemination to Improve Services and Results for Children with Disabilities—Model Demonstration Projects to Improve Adolescent Literacy for Students with Disabilities in Middle and High Schools, Grades 6-12.

    Background: The purpose of this priority is to fund three cooperative agreements to establish and operate model demonstration projects that are designed to improve adolescent literacy for students with disabilities in middle and high school grades 6 through 12, who score below grade level in reading, or who have identified reading goals and objectives on their individualized education program. Results from the National Assessment of Educational Progress (NAEP) demonstrate that there is a persistent gap in reading achievement between students with disabilities and those without disabilities. In 2013, the average scaled scores of eighth graders with disabilities, excluding those with a 504 plan, were 42 points lower than their non-disabled peers. Sixty-five percent of eighth graders with disabilities scored below basic level on the reading assessment compared with 19 percent of eighth graders without disabilities (U.S. Department of Education, 2014).

    Adolescents must possess the ability to read for understanding across a wide variety of content in order to meet college- and career-ready standards. Elements of literacy at the middle and secondary level include the ability to recognize and decode words and how students engage in reading as well as writing and oral communication skills.

    To improve adolescent literacy, as defined for the purpose of this priority, models should be designed to implement evidence-based adolescent literacy interventions that are based on strong theory or evidence of promise for improving reading, and locating, understanding, interpreting, evaluating, and using written information across multiple content areas. Intensive reading intervention to improve adolescent literacy should also include a mix of effective instruction, modeling, professional development, and evidence-based teaching practices that are appropriate for classroom and small group settings. Evidence also suggests the implementation of reading interventions requires well trained professionals who are prepared to incorporate these interventions within instruction across subjects in middle and high school grades (Faggella-Luby, Ware, & Capozzoli, 2009). Therefore, adolescent literacy models should also include professional development as a component of the model. In addition, such models need to be replicable across content areas in classrooms and small group settings in multiple school sites, with a goal of scaling-up the intervention for wider use.

    Priority: The purpose of this priority is to fund three cooperative agreements to establish and operate model demonstration projects that are designed to improve the literacy of adolescents with disabilities in middle and high school grades. For purposes of this priority, the target population includes: Students with disabilities in grades 6 through 12 who score below grade level in reading, or who have identified reading goals and objectives on their individualized education program. For purposes of this priority, the term “adolescent literacy” refers to the skills needed by individuals with disabilities in middle or high school grades to locate, read, understand, interpret, evaluate, and use written information across multiple content areas.

    (a) Model demonstration projects funded under this priority must direct their efforts at improving adolescent literacy interventions in content areas using effective whole-class and small group instructional approaches for students with disabilities;

    (b) Models must also include—

    (1) A professional development component to teach educators how to implement the interventions with fidelity across a variety of content areas.

    (2) Strategies for replicating interventions used by educators so they are effective when brought to scale across multiple classrooms within the participating local educational agency (LEA).

    (c) Each model must include a plan to implement at least one evidence-based adolescent literacy intervention that applies strong theory or evidence of promise. In addition, these models must be implemented at multiple school sites and include professional development for all content area teachers at all middle and high school grades targeted to receive the intervention.

    To be considered for funding under this absolute priority, applicants must meet the application requirements contained in this priority. Each project funded under this absolute priority also must meet the programmatic and administrative requirements specified in the priority.

    Application Requirements. An applicant must include in its application—

    (a) A detailed review of the research evidence that supports the effectiveness of the proposed model, its components, and processes to improve outcomes for adolescents with disabilities in middle and high school grades;

    (b) A logic model that depicts, at a minimum, the goals, activities, outputs, and outcomes of the proposed model demonstration project. The logic model must describe how LEAs and participating schools involved in the project would contribute to the activities, outputs, and outcomes of the proposed project. A logic model communicates how a project will achieve its outcomes and provides a framework for both the formative and summative evaluations of the project;

    Note:

    While section 77.1(c) of EDGAR contains a definition for “logic model,” OSEP, based upon its experience in this area, has been using the above definition as standard language for the OSEP TA&D priorities. OSEP's definition establishes a difference between logic models and conceptual frameworks whereas 34 CFR 77.1(c) considers the model to be one and the same. The following Web sites provide more information on logic models: www.researchutilization.org/matrix/logicmodel_resource3c.html and www.tadnet.org/pages/589.

    (c) A description of the activities of the proposed model demonstration project to improve literacy for adolescents with disabilities in subject areas taught in middle and high schools. The description must include:

    (1) Intervention components, including:

    (i) Evidence-based literacy instruction and interventions that are provided to the adolescents with disabilities, and are replicable across a variety of content areas by each participating school within a participating LEA;

    (ii) An explanation of the culturally responsive principles 1 to be incorporated within the interventions;

    1 Culturally responsive principles promote redesigning the learning environments to support the development and success of all students. Some examples of incorporating culturally responsive principles into learning environments include communicating high expectations to all students, incorporating students' cultural and home experiences into lessons by reshaping the curriculum to reflect students' experiences, and engaging students in activities where they can converse with one another on topics that tap into their background knowledge and experiences (Gay, 2000; King, Artiles, & Kozleski, 2009).

    (iii) An explanation of the professional development materials and activities that would be provided to school and LEA personnel to ensure that they implement the evidence-based intervention with fidelity; and

    (iv) A data plan that outlines the process for collecting, assessing, and analyzing 2 data for participating adolescents with disabilities. The data plan should include a description of how these data will be used to improve the instructional interventions.

    2 Applicants must ensure the confidentiality of individual data, consistent with the requirements of section 444 of the General Education Provisions Act (20 U.S.C. 1232g), commonly known as the “Family Educational Rights and Privacy Act” (FERPA), and State laws or regulations concerning the confidentiality of individual records. Final FERPA regulatory changes became effective January 3, 2012, and include requirements for data sharing. Applicants are encouraged to review the final FERPA regulations published on December 2, 2011 (76 FR 75604). Questions can be sent to the Family Policy Compliance Office (www.ed.gov/fpco) at (202) 260-3887 or [email protected]

    (2) Components that will be implemented in each participating school and LEA and that—

    (i) Identify the methods and criteria that will be used to select 3 and recruit 4 at least three middle or high schools and describe the schools and LEAs that will participate in the project, including their populations and whether the LEAs or the schools that are participating are high-poverty, high-need,5 rural,6 urban, or suburban; and

    3 For factors to consider when selecting model demonstration sites, the applicant should refer to Assessing Sites for Model Demonstration: Lessons Learned for OSEP Grantees at http://mdcc.sri.com/documents/reports/MDCC_Site_Assessment_Brief_09-30-11.pdf. The document also contains a site assessment tool.

    4 The applicant must describe who is going to be contacted within the district(s) and how “buy-in” from these and other leaders will be solicited.

    5 Section 2102(3) of the Elementary and Secondary Education Act of 1965, as amended (ESEA) defines a “high-need LEA” as an LEA—(A)(i) That serves not fewer than 10,000 children from families with incomes below the poverty line (as that term is defined in section 9101(33) of the ESEA); or (ii) for which not less than 20 percent of the children served by the LEA are from families with incomes below the poverty line; and (B)(i) for which there is a high percentage of teachers not teaching in the academic subjects or grade levels that the teachers were trained to teach; or (ii) for which there is a high percentage of teachers with emergency, provisional, or temporary certification or licensing.

    6 For purposes of this priority, “rural LEA” means an LEA that is eligible under the Small Rural School Achievement (SRSA) program or the Rural and Low-Income School (RLIS) program authorized under Title VI, Part B of the ESEA. Applicants may determine whether a particular LEA is eligible for these programs by referring to the information on the following Department Web sites. For SRSA: http://www2.ed.gov/programs/reapsrsa/index.html. For RLIS: http://www2.ed.gov/programs/reaprlisp/eligibility.html.

    Note:

    Applicants are encouraged to identify, to the extent possible, LEAs and schools willing to participate in the applicant's model demonstration. Final site selection will be determined in consultation with the OSEP project officer following the kick-off meeting described in paragraph (d)(1) of these application requirements.

    (ii) Provide initial and ongoing professional development, including coaching, for educators involved in implementing the models; and

    (3) Evaluation components, including:—

    (i) How the applicant will measure the extent to which project activities maintain fidelity to the proposed model;

    (ii) How the applicant will measure the social validity of the model—in other words, measuring the satisfaction of stakeholders' (i.e., educators', parents', and students') with the model components, processes, and outcomes;

    (iii) A formative evaluation plan, consistent with the project's logic model and the data-collection plan that will include, as appropriate, periodic collection of student performance and achievement data, as well as the data collection systems that will be used to measure the fidelity of the implementation activities to the proposed model, stakeholder satisfaction, and descriptions of the settings where the intervention will take place. The plan must outline how these data will be reviewed by project staff, when they will be reviewed, and how they will be used during the course of the project to adjust the model or its implementation to increase the model's usefulness, generalizability, and potential for sustainability; and

    (iv) The timeline and plan to collect summative evaluation data on the reading achievement of adolescents with disabilities and their nondisabled peers; and

    (d) A budget for attendance at the following:

    (1) A one and one half-day kick-off meeting to be held in Washington, DC, after receipt of the award.

    (2) The three-day Project Directors' Conference in Washington, DC, during each year of the project period; and

    (3) Six travel days spread across years 2-4 of the project period to attend planning meetings, Department briefings, Department-sponsored conferences, and other meetings, as requested by OSEP, to be held in Washington, DC, with the OSEP project officer.

    Other Project Activities. To meet the requirements of this priority, each project, at a minimum, must:

    (a) Document the process for model replication purposes, should the model be successful;

    (b) Communicate and collaborate on an ongoing basis with other Department-funded literacy projects to share information on successful strategies and implementation challenges regarding adolescent literacy instruction and achievement;

    (c) Maintain ongoing telephone and email communication with the OSEP project officer and the other model demonstration projects funded under this priority; and

    (d) If the project maintains a Web site, include relevant information about the model, the intervention, and the demonstration activities that meets government- or industry-recognized standards for accessibility.

    References:

    Faggella-Luby, M. N., Ware, S. M., & Capozzoli, A. (2009). Adolescent literacy—Reviewing adolescent literacy reports: Key components and critical questions. Journal of Literacy Research, 41, 453-475. Gay, G. (2000). Culturally responsive teaching: Theory, research, and practice. New York: Teachers College Press. King, K. A., Artiles, A. J., & Kozleski, E. B. (2009). Professional learning for culturally responsive teaching. Retrieved from www.equityallianceatasu.org/sites/default/files/Web site_files/exemplarFINAL.pdf. U.S. Department of Education, Institute of Education Sciences. (2014). National Center for Education Statistics, National Assessment of Educational Progress (NAEP), The Nation's Report Card. Washington, DC: Author. Retrieved from http://nationsreportcard.gov.

    Waiver of Proposed Rulemaking: Under the Administrative Procedure Act (APA) (5 U.S.C. 553), the Department generally offers interested parties the opportunity to comment on proposed priorities and requirements. However, section 681(d) of the IDEA makes the public comment requirements of the APA inapplicable to the priority in this notice.

    Program Authority: 20 U.S.C. 1463 and 1481.

    Applicable Regulations:

    The following regulations apply: (a) The Education Department General Administrative Regulations (EDGAR) in 34 CFR parts 75, 77, 79, 81, 82, 84, 86, 97, 98, and 99. (b) The Education Department debarment and suspension regulations as adopted in 2 CFR part 3485 and the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards as adopted as regulations of the Department in 2 CFR part 3474.7

    7 If a for-profit (commercial) organization is awarded a grant, it will be required to comply with the Uniform Guidance in 2 CFR part 200, as adopted as regulations of the Department at 2 CFR part 3474.

    Note:

    The regulations in 34 CFR part 79 apply to all applicants except federally recognized Indian tribes.

    Note:

    The regulations in 34 CFR part 86 apply only to institutions of higher education (IHEs).

    II. Award Information

    Type of Award: Cooperative agreements.

    Estimated Available Funds: $1,200,000.

    Contingent on the availability of funds and the quality of applications, we may make additional awards in FY 2016 from the list of unfunded applicants from this competition.

    Estimated Range of Awards: $375,000 to $400,000.

    Estimated Average Size of Award: $400,000.

    Maximum Award: We will reject and not review any application that proposes a budget exceeding $400,000 for a single budget period of 12 months. The Assistant Secretary for Special Education and Rehabilitative Services may change the maximum amount through a notice published in the Federal Register.

    Estimated Number of Awards: 3.

    Note:

    The Department is not bound by any estimates in this notice.

    Project Period: Up to 48 months.

    III. Eligibility Information

    Eligible Applicants: State educational agencies (SEAs); LEAs, including public charter schools that are considered LEAs under State law; IHEs; other public agencies; private nonprofit organizations; outlying areas; freely associated States; Indian tribes or tribal organizations; and for-profit organizations.

    2. Cost Sharing or Matching: This competition does not require cost sharing or matching.

    3. Other: General Requirements:

    (a) The projects funded under this competition must make positive efforts to employ, and advance in employment, qualified individuals with disabilities (see section 606 of the IDEA).

    (b) Each applicant and grantee under this competition must involve individuals with disabilities or parents of individuals with disabilities ages birth through 26 in planning, implementing, and evaluating the project (see section 682(a)(1)(A) of the IDEA).

    IV. Application and Submission Information

    1. Address to Request Application Package: Education Publications Center (ED Pubs), U.S. Department of Education, P.O. Box 22207, Alexandria, VA 22304. Telephone, toll free: 1-877-433-7827. FAX: (703) 605-6794. If you use a telecommunications device for the deaf (TDD) or a text telephone (TTY), call, toll free: 1-877-576-7734.

    You can contact ED Pubs at its Web site, also: www.EDPubs.gov or at its email address: [email protected]

    If you request an application package from ED Pubs, be sure to identify this competition as follows: CFDA number 84.326M.

    Individuals with disabilities can obtain a copy of the application package in an accessible format (e.g., braille, large print, audiotape, or compact disc) by contacting the person or team listed under Accessible Format in section VIII of this notice.

    2. Content and Form of Application Submission: Requirements concerning the content of an application, together with the forms you must submit, are in the application package for this competition.

    Page Limit: The application narrative (Part III of the application) is where you, the applicant, address the selection criteria that reviewers use to evaluate your application. You must limit Part III to the equivalent of no more than 50 pages, using the following standards:

    • A “page” is 8.5″ x 11″, on one side only, with 1″ margins at the top, bottom, and both sides.

    • Double space (no more than three lines per vertical inch) all text in the application narrative, including titles, headings, footnotes, quotations, references, and captions, as well as all text in charts, tables, figures, and graphs.

    • Use a font that is either 12 point or larger or no smaller than 10 pitch (characters per inch).

    • Use one of the following fonts: Times New Roman, Courier, Courier New, or Arial. An application submitted in any other font (including Times Roman or Arial Narrow) will not be accepted.

    The page limit does not apply to Part I, the cover sheet; Part II, the budget section, including the narrative budget justification; Part IV, the assurances and certifications; or the abstract, the resumes, the bibliography, or the letters of support. However, the page limit does apply to all of the application narrative section (Part III).

    We will reject your application if you exceed the page limit in the application narrative section; or if you apply standards other than those specified in the application package.

    Submission of Proprietary Information:

    Given the types of projects that may be proposed in applications for the Technical Assistance and Dissemination to Improve Services and Results for Children with Disabilities—Model Demonstration Projects to Improve Adolescent Literacy for Students with Disabilities in Middle and High Schools, Grades 6-12, your application may include business information that you consider proprietary. The Department's regulations define “business information” in 34 CFR 5.11.

    Under the Department's transparency policies, we make successful applicants' abstracts available to the public.

    Consistent with Executive Order 12600, please designate in your application any information that you feel is exempt from disclosure under Exemption 4 of the Freedom of Information Act. In the appropriate Appendix section of your application, under “Other Attachments Form,” please list the page number or numbers on which we can find this information. For additional information please see 34 CFR 5.11(c).

    3. Submission Dates and Times:

    Applications Available: March 18, 2015.

    Deadline for Transmittal of Applications: May 4, 2015.

    Applications for grants under this competition must be submitted electronically using the Grants.gov Apply site (Grants.gov). For information (including dates and times) about how to submit your application electronically, or in paper format by mail or hand delivery if you qualify for an exception to the electronic submission requirement, please refer to section IV. 7. Other Submission Requirements of this notice.

    We do not consider an application that does not comply with the deadline requirements.

    Individuals with disabilities who need an accommodation or auxiliary aid in connection with the application process should contact the person listed under FOR FURTHER INFORMATION CONTACT in section VII of this notice. If the Department provides an accommodation or auxiliary aid to an individual with a disability in connection with the application process, the individual's application remains subject to all other requirements and limitations in this notice.

    Deadline for Intergovernmental Review: July 1, 2015.

    4. Intergovernmental Review: This competition is subject to Executive Order 12372 and the regulations in 34 CFR part 79. Information about Intergovernmental Review of Federal Programs under Executive Order 12372 is in the application package for this competition.

    5. Funding Restrictions: We reference regulations outlining funding restrictions in the Applicable Regulations section of this notice.

    6. Data Universal Numbering System Number, Taxpayer Identification Number, and System for Award Management: To do business with the Department of Education, you must—

    a. Have a Data Universal Numbering System (DUNS) number and a Taxpayer Identification Number (TIN);

    b. Register both your Unique Entity Identifier (UEI) number and TIN with the System for Award Management (SAM), the Government's primary registrant database;

    c. Provide your UEI number and TIN on your application; and

    d. Maintain an active SAM registration with current information while your application is under review by the Department and, if you are awarded a grant, during the project period.

    Currently, SAM relies on the identifier provided by Dun and Bradstreet (DUNS number) for the UEI. You can create a DUNS number within one business day.

    If you are a corporate entity, agency, institution, or organization, you can obtain a TIN from the Internal Revenue Service. If you are an individual, you can obtain a TIN from the Internal Revenue Service or the Social Security Administration. If you need a new TIN, please allow 2-5 weeks for your TIN to become active.

    The SAM registration process may take seven or more business days, but may take upwards of several weeks, depending on the completeness and accuracy of the data entered into the SAM database by an entity. Thus, if you think you might want to apply for Federal financial assistance under a program administered by the Department, please allow sufficient time to obtain and register your DUNS number and TIN. We strongly recommend that you register early.

    Note:

    Once your SAM registration is active, you will need to allow 24 to 48 hours for the information to be available in Grants.gov and before you can submit an application through Grants.gov. If you are currently registered with the SAM, you may not need to make any changes. However, please make certain that the TIN associated with your DUNS number is correct. Also note that you will need to update your registration annually. This may take three or more business days to complete. Information about SAM is available at www.SAM.gov. To further assist you with obtaining your existing SAM account, we have prepared a SAM.gov Tip Sheet, which you can find at: http://www2.ed.gov/fund/grant/apply/sam-faqs.html.

    In addition, if you are submitting your application via Grants.gov, you must (1) be designated by your organization as an Authorized Organization Representative (AOR); and (2) register yourself with Grants.gov as an AOR. Details on these steps are outlined at the following Grants.gov Web page: www.grants.gov/web/grants/register.html.

    7. Other Submission Requirements: Applications for grants under this competition must be submitted electronically unless you qualify for an exception to this requirement in accordance with the instructions in this section.

    a. Electronic Submission of Applications.

    Applications for grants under the Model Demonstration Projects on the Improvement of Adolescent Literacy for Students with Disabilities in Middle and High Schools in Grades 6-12 competition, CFDA number 84.326M, must be submitted electronically using the Government-wide Grants.gov Apply site at www.Grants.gov. Through this site, you will be able to download a copy of the application package, complete it offline, and then upload and submit your application. You may not email an electronic copy of a grant application to us.

    We will reject your application if you submit it in paper format unless, as described elsewhere in this section, you qualify for one of the exceptions to the electronic submission requirement and submit, no later than two weeks before the application deadline date, a written statement to the Department that you qualify for one of these exceptions. Further information regarding calculation of the date that is two weeks before the application deadline date is provided later in this section under Exception to Electronic Submission Requirement.

    You may access the electronic grant application for the Model Demonstration Projects to Improve Adolescent Literacy for Students with Disabilities in Middle and High Schools, Grades 6-12 competition at www.Grants.gov. You must search for the downloadable application package for this competition by the CFDA number. Do not include the CFDA number's alpha suffix in your search (e.g., search for 84.326, not 84.326M).

    Please note the following:

    • When you enter the Grants.gov site, you will find information about submitting an application electronically through the site, as well as the hours of operation.

    • Applications received by Grants.gov are date and time stamped. Your application must be fully uploaded and submitted and must be date and time stamped by the Grants.gov system no later than 4:30:00 p.m., Washington, DC time, on the application deadline date. Except as otherwise noted in this section, we will not accept your application if it is received—that is, date and time stamped by the Grants.gov system—after 4:30:00 p.m., Washington, DC time, on the application deadline date. We do not consider an application that does not comply with the deadline requirements. When we retrieve your application from Grants.gov, we will notify you if we are rejecting your application because it was date and time stamped by the Grants.gov system after 4:30:00 p.m., Washington, DC time, on the application deadline date.

    • The amount of time it can take to upload an application will vary depending on a variety of factors, including the size of the application and the speed of your Internet connection. Therefore, we strongly recommend that you do not wait until the application deadline date to begin the submission process through Grants.gov.

    • You should review and follow the Education Submission Procedures for submitting an application through Grants.gov that are included in the application package for this competition to ensure that you submit your application in a timely manner to the Grants.gov system. You can also find the Education Submission Procedures pertaining to Grants.gov under News and Events on the Department's G5 system home page at www.G5.gov.

    • You will not receive additional point value because you submit your application in electronic format, nor will we penalize you if you qualify for an exception to the electronic submission requirement, as described elsewhere in this section, and submit your application in paper format.

    • You must submit all documents electronically, including all information you typically provide on the following forms: the Application for Federal Assistance (SF 424), the Department of Education Supplemental Information for SF 424, Budget Information—Non-Construction Programs (ED 524), and all necessary assurances and certifications.

    • You must upload any narrative sections and all other attachments to your application as files in a PDF (Portable Document) read-only, non-modifiable format. Do not upload an interactive or fillable PDF file. If you upload a file type other than a read-only, non-modifiable PDF or submit a password-protected file, we will not review that material. Additional, detailed information on how to attach files is in the application instructions.

    • Your electronic application must comply with any page-limit requirements described in this notice.

    • After you electronically submit your application, you will receive from Grants.gov an automatic notification of receipt that contains a Grants.gov tracking number. (This notification indicates receipt by Grants.gov only, not receipt by the Department.) The Department then will retrieve your application from Grants.gov and send a second notification to you by email. This second notification indicates that the Department has received your application and has assigned your application a PR/Award number (an ED-specified identifying number unique to your application).

    • We may request that you provide us original signatures on forms at a later date.

    Application Deadline Date Extension in Case of Technical Issues with the Grants.gov System: If you are experiencing problems submitting your application through Grants.gov, please contact the Grants.gov Support Desk, toll free, at 1-800-518-4726. You must obtain a Grants.gov Support Desk Case Number and must keep a record of it.

    If you are prevented from electronically submitting your application on the application deadline date because of technical problems with the Grants.gov system, we will grant you an extension until 4:30:00 p.m., Washington, DC time, the following business day to enable you to transmit your application electronically or by hand delivery. You also may mail your application by following the mailing instructions described elsewhere in this notice.

    If you submit an application after 4:30:00 p.m., Washington, DC time, on the application deadline date, please contact the person listed under FOR FURTHER INFORMATION CONTACT in section VII of this notice and provide an explanation of the technical problem you experienced with Grants.gov, along with the Grants.gov Support Desk Case Number. We will accept your application if we can confirm that a technical problem occurred with the Grants.gov system and that that problem affected your ability to submit your application by 4:30:00 p.m., Washington, DC time, on the application deadline date. The Department will contact you after a determination is made on whether your application will be accepted.

    Note:

    The extensions to which we refer in this section apply only to the unavailability of, or technical problems with, the Grants.gov system. We will not grant you an extension if you failed to fully register to submit your application to Grants.gov before the application deadline date and time or if the technical problem you experienced is unrelated to the Grants.gov system.

    Exception to Electronic Submission Requirement: You qualify for an exception to the electronic submission requirement, and may submit your application in paper format, if you are unable to submit an application through the Grants.gov system because—

    • You do not have access to the Internet; or

    • You do not have the capacity to upload large documents to the Grants.gov system;

    and

    • No later than two weeks before the application deadline date (14 calendar days or, if the fourteenth calendar day before the application deadline date falls on a Federal holiday, the next business day following the Federal holiday), you mail or fax a written statement to the Department, explaining which of the two grounds for an exception prevent you from using the Internet to submit your application.

    If you mail your written statement to the Department, it must be postmarked no later than two weeks before the application deadline date. If you fax your written statement to the Department, we must receive the faxed statement no later than two weeks before the application deadline date.

    Address and mail or fax your statement to: Greg Knollman, U.S. Department of Education, 400 Maryland Avenue SW., Room 4096, Potomac Center Plaza (PCP), Washington, DC 20202-2600. FAX: (202) 245-7617.

    Your paper application must be submitted in accordance with the mail or hand delivery instructions described in this notice.

    b. Submission of Paper Applications by Mail.

    If you qualify for an exception to the electronic submission requirement, you may mail (through the U.S. Postal Service or a commercial carrier) your application to the Department. You must mail the original and two copies of your application, on or before the application deadline date, to the Department at the following address: U.S. Department of Education, Application Control Center, Attention: (CFDA Number 84.326M), LBJ Basement Level 1, 400 Maryland Avenue SW., Washington, DC 20202-4260.

    You must show proof of mailing consisting of one of the following:

    (1) A legibly dated U.S. Postal Service postmark.

    (2) A legible mail receipt with the date of mailing stamped by the U.S. Postal Service.

    (3) A dated shipping label, invoice, or receipt from a commercial carrier.

    (4) Any other proof of mailing acceptable to the Secretary of the U.S. Department of Education.

    If you mail your application through the U.S. Postal Service, we do not accept either of the following as proof of mailing:

    (1) A private metered postmark.

    (2) A mail receipt that is not dated by the U.S. Postal Service.

    If your application is postmarked after the application deadline date, we will not consider your application.

    Note:

    The U.S. Postal Service does not uniformly provide a dated postmark. Before relying on this method, you should check with your local post office.

    c. Submission of Paper Applications by Hand Delivery.

    If you qualify for an exception to the electronic submission requirement, you (or a courier service) may deliver your paper application to the Department by hand. You must deliver the original and two copies of your application by hand, on or before the application deadline date, to the Department at the following address: U.S. Department of Education, Application Control Center, Attention: (CFDA Number 84.326M), 550 12th Street SW., Room 7039, Potomac Center Plaza, Washington, DC 20202-4260.

    The Application Control Center accepts hand deliveries daily between 8:00 a.m. and 4:30:00 p.m., Washington, DC time, except Saturdays, Sundays, and Federal holidays.

    Note for Mail or Hand Delivery of Paper Applications: If you mail or hand deliver your application to the Department—

    (1) You must indicate on the envelope and—if not provided by the Department—in Item 11 of the SF 424 the CFDA number, including suffix letter, if any, of the competition under which you are submitting your application; and

    (2) The Application Control Center will mail to you a notification of receipt of your grant application. If you do not receive this notification within 15 business days from the application deadline date, you should call the U.S. Department of Education Application Control Center at (202) 245-6288.

    V. Application Review Information

    1. Selection Criteria: The selection criteria for this program are provided in the application package.

    2. Review and Selection Process: We remind potential applicants that in reviewing applications in any discretionary grant competition, the Secretary may consider, under 34 CFR 75.217(d)(3), the past performance of the applicant in carrying out a previous award, such as the applicant's use of funds, achievement of project objectives, and compliance with grant conditions. The Secretary may also consider whether the applicant failed to submit a timely performance report or submitted a report of unacceptable quality.

    In addition, in making a competitive grant award, the Secretary also requires various assurances including those applicable to Federal civil rights laws that prohibit discrimination in programs or activities receiving Federal financial assistance from the Department of Education (34 CFR 100.4, 104.5, 106.4, 108.8, and 110.23).

    3. Additional Review and Selection Process Factors:

    In the past, the Department has had difficulty finding peer reviewers for certain competitions because so many individuals who are eligible to serve as peer reviewers have conflicts of interest. The standing panel requirements under section 682(b) of IDEA also have placed additional constraints on the availability of reviewers. Therefore, the Department has determined that, for some discretionary grant competitions, applications may be separated into two or more groups and ranked and selected for funding within specific groups. This procedure will make it easier for the Department to find peer reviewers, by ensuring that greater numbers of individuals who are eligible to serve as reviewers for any particular group of applicants will not have conflicts of interest. It also will increase the quality, independence, and fairness of the review process, while permitting panel members to review applications under discretionary grant competitions for which they also have submitted applications. However, if the Department decides to select an equal number of applications in each group for funding, this may result in different cut-off points for fundable applications in each group.

    4. Special Conditions: Under 2 CFR 3474.10, the Secretary may impose special conditions and, in appropriate circumstances, high risk conditions on a grant if the applicant or grantee is not financially stable; has a history of unsatisfactory performance; has a financial or other management system that does not meet the standards in 2 CFR part 200; has not fulfilled the conditions of a prior grant; or is otherwise not responsible.

    VI. Award Administration Information

    1. Award Notices: If your application is successful, we notify your U.S. Representative and U.S. Senators and send you a Grant Award Notification (GAN); or we may send you an email containing a link to access an electronic version of your GAN. We may notify you informally, also.

    If your application is not evaluated or not selected for funding, we notify you.

    2. Administrative and National Policy Requirements: We identify administrative and national policy requirements in the application package and reference these and other requirements in the Applicable Regulations section of this notice.

    We reference the regulations outlining the terms and conditions of an award in the Applicable Regulations section of this notice and include these and other specific conditions in the GAN. The GAN also incorporates your approved application as part of your binding commitments under the grant.

    3. Reporting: (a) If you apply for a grant under this competition, you must ensure that you have in place the necessary processes and systems to comply with the reporting requirements in 2 CFR part 170 should you receive funding under the competition. This does not apply if you have an exception under 2 CFR 170.110(b).

    (b) At the end of your project period, you must submit a final performance report, including financial information, as directed by the Secretary. If you receive a multi-year award, you must submit an annual performance report that provides the most current performance and financial expenditure information as directed by the Secretary under 34 CFR 75.118. The Secretary may also require more frequent performance reports under 34 CFR 75.720(c). For specific requirements on reporting, please go to www.ed.gov/fund/grant/apply/appforms/appforms.html.

    4. Performance Measures: Under the Government Performance and Results Act of 1993 (GPRA), the Department has established a set of performance measures, including long-term measures, that are designed to yield information on various aspects of the effectiveness and quality of the Technical Assistance and Dissemination to Improve Services and Results for Children with Disabilities program. These measures focus on the extent to which projects provide high-quality products and services, the relevance of project products and services to educational and early intervention policy and practice, and the use of products and services to improve educational and early intervention policy and practice.

    Grantees will be required to report information on their project's performance in annual reports to the Department (34 CFR 75.590).

    5. Continuation Awards: In making a continuation award, the Secretary may consider, under 34 CFR 75.253, the extent to which a grantee has made “substantial progress toward meeting the objectives in its approved application.” This consideration includes the review of a grantee's progress in meeting the targets and projected outcomes in its approved application, and whether the grantee has expended funds in a manner that is consistent with its approved application and budget. In making a continuation grant, the Secretary also considers whether the grantee is operating in compliance with the assurances in its approved application, including those applicable to Federal civil rights laws that prohibit discrimination in programs or activities receiving Federal financial assistance from the Department (34 CFR 100.4, 104.5, 106.4, 108.8, and 110.23).

    VII. Agency Contact FOR FURTHER INFORMATION CONTACT:

    Greg Knollman, U.S. Department of Education, 400 Maryland Avenue SW., Room 4096, PCP, Washington, DC 20202-2600. Telephone: (202) 245-6425.

    If you use a TDD or a TTY, call the Federal Relay Service (FRS), toll free, at 1-800-877-8339.

    VIII. Other Information

    Accessible Format: Individuals with disabilities can obtain this document and a copy of the application package in an accessible format (e.g., braille, large print, audiotape, or compact disc) by contacting the Grants and Contracts Services Team, U.S. Department of Education, 400 Maryland Avenue SW., room 5075, PCP, Washington, DC 20202-2550. Telephone: (202) 245-7363. If you use a TDD or a TTY, call the FRS, toll free, at 1-800-877-8339.

    Electronic Access to This Document: The official version of this document is the document published in the Federal Register. Free Internet access to the official edition of the Federal Register and the Code of Federal Regulations is available via the Federal Digital System at: www.thefederalregister.org/fdsys. At this site you can view this document, as well as all other documents of this Department published in the Federal Register, in text or Adobe Portable Document Format (PDF). To use PDF you must have Adobe Acrobat Reader, which is available free at the site.

    You may also access documents of the Department published in the Federal Register by using the article search feature at: www.federalregister.gov. Specifically, through the advanced search feature at this site, you can limit your search to documents published by the Department.

    Dated: March 12, 2015. Sue Swenson, Acting Assistant Secretary for Special Education and Rehabilitative Services.
    [FR Doc. 2015-06273 Filed 3-17-15; 8:45 am] BILLING CODE 4000-01-P
    DEPARTMENT OF ENERGY Federal Energy Regulatory Commission [Docket No. ER15-1176-000] South Jersey Energy ISO6, LLC; Supplemental Notice That Initial Market-Based Rate Filing Includes Request for Blanket Section 204 Authorization

    This is a supplemental notice in the above-referenced proceeding, of South Jersey Energy ISO6, LLC's application for market-based rate authority, with an accompanying rate schedule, noting that such application includes a request for blanket authorization, under 18 CFR part 34, of future issuances of securities and assumptions of liability.

    Any person desiring to intervene or to protest should file with the Federal Energy Regulatory Commission, 888 First Street NE., Washington, DC 20426, in accordance with Rules 211 and 214 of the Commission's Rules of Practice and Procedure (18 CFR 385.211 and 385.214). Anyone filing a motion to intervene or protest must serve a copy of that document on the Applicant.

    Notice is hereby given that the deadline for filing protests with regard to the applicant's request for blanket authorization, under 18 CFR part 34, of future issuances of securities and assumptions of liability is March 30, 2015.

    The Commission encourages electronic submission of protests and interventions in lieu of paper, using the FERC Online links at http://www.ferc.gov. To facilitate electronic service, persons with Internet access who will eFile a document and/or be listed as a contact for an intervenor must create and validate an eRegistration account using the eRegistration link. Select the eFiling link to log on and submit the intervention or protests.

    Persons unable to file electronically should submit an original and 5 copies of the intervention or protest to the Federal Energy Regulatory Commission, 888 First Street NE., Washington, DC 20426.

    The filings in the above-referenced proceeding(s) are accessible in the Commission's eLibrary system by clicking on the appropriate link in the above list. They are also available for review in the Commission's Public Reference Room in Washington, DC. There is an eSubscription link on the Web site that enables subscribers to receive email notification when a document is added to a subscribed docket(s). For assistance with any FERC Online service, please email [email protected] or call (866) 208-3676 (toll free). For TTY, call (202) 502-8659.

    Dated: March 10, 2015. Nathaniel J. Davis, Sr., Deputy Secretary.
    [FR Doc. 2015-06132 Filed 3-17-15; 8:45 am] BILLING CODE 6717-01-P
    DEPARTMENT OF ENERGY Federal Energy Regulatory Commission Combined Notice of Filings #1

    Take notice that the Commission received the following electric rate filings:

    Docket Numbers: ER15-158-001.

    Applicants: Southwest Power Pool, Inc.

    Description: eTariff filing per 35.19a(b): 1765R11 KCPL-GMO Refund Report to be effective N/A under ER15-158.

    Filed Date: 3/12/15.

    Accession Number: 20150312-5059.

    Comments Due: 5 p.m. ET 4/2/15.

    Docket Numbers: ER15-164-001.

    Applicants: Southwest Power Pool, Inc.

    Description: eTariff filing per 35.19a(b): 1636R13 Kansas Electric Power Cooperative, Inc. Refund Report to be effective N/A.

    Filed Date: 3/12/15.

    Accession Number: 20150312-5065.

    Comments Due: 5 p.m. ET 4/2/15.

    Docket Numbers: ER15-350-001.

    Applicants: Southwest Power Pool, Inc.

    Description: eTariff filing per 35.19a(b): 1883R3 Westar (City of Alma) Refund Report to be effective N/A.

    Filed Date: 3/12/15.

    Accession Number: 20150312-5066.

    Comments Due: 5 p.m. ET 4/2/15.

    Docket Numbers: ER15-820-001.

    Applicants: Zone One Energy, LLC.

    Description: Tariff Amendment per 35.17(b): Baseline New to be effective 4/15/2015.

    Filed Date: 3/11/15.

    Accession Number: 20150311-5010.

    Comments Due: 5 p.m. ET 4/1/15.

    Docket Numbers: ER15-883-001.

    Applicants: Southern California Edison Company.

    Description: Tariff Amendment per 35.17(b): Amendment to GIA and Distrib Serv Agmt San Gorgonio Weswinds II, Difwind Farms to be effective 1/20/2015.

    Filed Date: 3/12/15.

    Accession Number: 20150312-5083.

    Comments Due: 5 p.m. ET 4/2/15.

    Docket Numbers: ER15-900-001.

    Applicants: Marshfield Utilities.

    Description: Tariff Amendment per 35.17(b): Amendment to 1 to be effective 4/1/2015.

    Filed Date: 3/12/15.

    Accession Number: 20150312-5110.

    Comments Due: 5 p.m. ET 4/2/15.

    Docket Numbers: ER15-1219-000.

    Applicants: Arizona Public Service Company.

    Description: § 205(d) rate filing per 35.13(a)(2)(iii): Service Agreement Nos. 190, 192, 194, 195 Revisions—ANPP to be effective 3/11/2015.

    Filed Date: 3/11/15.

    Accession Number: 20150311-5179.

    Comments Due: 5 p.m. ET 4/1/15.

    Docket Numbers: ER15-1222-000.

    Applicants: Southern California Edison Company.

    Description: § 205(d) rate filing per 35.13(a)(2)(iii): Unexecuted GIA and Distribution Service Agreement with Edom Hills Project 1, LLC to be effective 3/15/2015.

    Filed Date: 3/11/15.

    Accession Number: 20150311-5216.

    Comments Due: 5 p.m. ET 4/1/15.

    Docket Numbers: ER15-1223-000.

    Applicants: Power Contract Financing II, Inc.

    Description: Tariff Withdrawal per 35.15: Notice of Cancellation to be effective 3/12/2015.

    Filed Date: 3/11/15.

    Accession Number: 20150311-5258.

    Comments Due: 5 p.m. ET 4/1/15.

    Docket Numbers: ER15-1224-000.

    Applicants: New York State Electric & Gas Corporation.

    Description: § 205(d) rate filing per 35.13(a)(2)(iii): Concurrence in Amended and Restated LGIA among NYISO, NYSEG and Sheldon Energy to be effective 2/18/2015.

    Filed Date: 3/11/15.

    Accession Number: 20150311-5284.

    Comments Due: 5 p.m. ET 4/1/15.

    Docket Numbers: ER15-1225-000.

    Applicants: Southwest Power Pool, Inc.

    Description: § 205(d) rate filing per 35.13(a)(2)(iii): Updates to Section 2.2.2 of Attachment C to be effective 5/10/2015.

    Filed Date: 3/11/15.

    Accession Number: 20150311-5287.

    Comments Due: 5 p.m. ET 4/1/15.

    Docket Numbers: ER15-1226-000.

    Applicants: CenterPoint Energy Houston Electric, LLC.

    Description: § 205(d) rate filing per 35.13(a)(1): TFO Tariff Interim Rate Revision to Conform with PUCT-Approved ERCOT Rate to be effective 2/25/2015.

    Filed Date: 3/11/15.

    Accession Number: 20150311-5289.

    Comments Due: 5 p.m. ET 4/1/15.

    Docket Numbers: ER15-1227-000.

    Applicants: California Clean Power Corp.

    Description: Initial rate filing per 35.12 California Clean Power Corp. Market-Based Rate Tariff to be effective 4/20/2015.

    Filed Date: 3/11/15.

    Accession Number: 20150311-5290.

    Comments Due: 5 p.m. ET 4/1/15.

    Docket Numbers: ER15-1228-000.

    Applicants: Southwest Power Pool, Inc.

    Description: § 205(d) rate filing per 35.13(a)(2)(iii): 1670R2 Transmission Interchange Agreement to be effective 2/23/2015.

    Filed Date: 3/12/15.

    Accession Number: 20150312-5058.

    Comments Due: 5 p.m. ET 4/2/15.

    The filings are accessible in the Commission's eLibrary system by clicking on the links or querying the docket number.

    Any person desiring to intervene or protest in any of the above proceedings must file in accordance with Rules 211 and 214 of the Commission's Regulations (18 CFR 385.211 and 385.214) on or before 5:00 p.m. Eastern time on the specified comment date. Protests may be considered, but intervention is necessary to become a party to the proceeding.

    eFiling is encouraged. More detailed information relating to filing requirements, interventions, protests, service, and qualifying facilities filings can be found at: http://www.ferc.gov/docs-filing/efiling/filing-req.pdf. For other information, call (866) 208-3676 (toll free). For TTY, call (202) 502-8659.

    Dated: March 12, 2015. Nathaniel J. Davis, Sr., Deputy Secretary.
    [FR Doc. 2015-06165 Filed 3-17-15; 8:45 am] BILLING CODE 6717-01-P
    DEPARTMENT OF ENERGY Federal Energy Regulatory Commission Combined Notice of Filings #1

    Take notice that the Commission received the following electric rate filings:

    Docket Numbers: ER15-794-002.

    Applicants: Catalyst Paper Operations Inc..

    Description: Tariff Amendment per 35.17(b): Revised Amended MBR Tariff Application to be effective 12/31/9998.

    Filed Date: 3/10/15.

    Accession Number: 20150310-5153.

    Comments Due: 5 p.m. ET 3/31/15.

    Docket Numbers: ER15-820-001.

    Applicants: Zone One Energy, LLC.

    Description: Tariff Amendment per 35.17(b): Baseline New to be effective 4/15/2015.

    Filed Date: 3/11/15.

    Accession Number: 20150311-5010.

    Comments Due: 5 p.m. ET 4/1/15.

    Docket Numbers: ER15-1212-001.

    Applicants: Southwest Power Pool, Inc..

    Description: Tariff Amendment per 35.17(b): 1876R4 Kansas Electric Power Cooperative, Inc. NITSA NOA Ministerial Filing to be effective 3/1/2015.

    Filed Date: 3/10/15.

    Accession Number: 20150310-5171.

    Comments Due: 5 p.m. ET 3/31/15.

    Docket Numbers: ER15-1215-000.

    Applicants: Avista Corporation.

    Description: Section 205(d) rate filing per 35.13(a)(2)(iii): Avista Corp Rate Schedule FERC No. 548 to be effective 12/31/9998.

    Filed Date: 3/10/15.

    Accession Number: 20150310-5175.

    Comments Due: 5 p.m. ET 3/31/15.

    Docket Numbers: ER15-1216-000.

    Applicants: PacifiCorp.

    Description: Section 205(d) rate filing per 35.13(a)(2)(iii): OATT Revised Definitions and Attachment T (Demand Response) to be effective 3/11/2015.

    Filed Date: 3/10/15.

    Accession Number: 20150310-5190.

    Comments Due: 5 p.m. ET 3/31/15.

    Docket Numbers: ER15-1217-000.

    Applicants: Southern California Edison Company.

    Description: Section 205(d) rate filing per 35.13(a)(2)(iii): GIA and Distribution Service Agmt with Cal Sunrise LLC to be effective 5/11/2015.

    Filed Date: 3/11/15.

    Accession Number: 20150311-5004.

    Comments Due: 5 p.m. ET 4/1/15.

    Docket Numbers: ER15-1218-000.

    Applicants: Solar Star California XIII, LLC.

    Description: Initial rate filing per 35.12 Solar Star California XIII, LLC Market-Based Rate Tariff to be effective 4/1/2015.

    Filed Date: 3/11/15.

    Accession Number: 20150311-5049.

    Comments Due: 5 p.m. ET 4/1/15.

    The filings are accessible in the Commission's eLibrary system by clicking on the links or querying the docket number.

    Any person desiring to intervene or protest in any of the above proceedings must file in accordance with Rules 211 and 214 of the Commission's Regulations (18 CFR 385.211 and 385.214) on or before 5:00 p.m. Eastern time on the specified comment date. Protests may be considered, but intervention is necessary to become a party to the proceeding.

    eFiling is encouraged. More detailed information relating to filing requirements, interventions, protests, service, and qualifying facilities filings can be found at: http://www.ferc.gov/docs-filing/efiling/filing-req.pdf. For other information, call (866) 208-3676 (toll free). For TTY, call (202) 502-8659.

    Dated: March 11, 2015. Nathaniel J. Davis, Sr., Deputy Secretary.
    [FR Doc. 2015-06134 Filed 3-17-15; 8:45 am] BILLING CODE 6717-01-P
    DEPARTMENT OF ENERGY Federal Energy Regulatory Commission [Docket No. CP15-102-000] Rockies Express Pipeline LLC: Notice of Application

    Take notice that on March 2, 2015, Rockies Express Pipeline LLC, (Rockies Express) filed an application with the Federal Energy Regulatory Commission pursuant to section 7(c) of the Natural Gas Act (NGA) requesting a certificate of public convenience and necessity authorizing the operation as section 7(c) jurisdictional facilities certain pipeline assets, located in Noble and Monroe Counties, Ohio, that heretofore have been constructed and operated solely for the purpose of providing transportation services permitted under section 311 of the Natural Gas Policy Act, all as more completely described in the Application. This filing is available for review at the Commission in the Public Reference Room or may be viewed on the Commission's Web site web at http://www.ferc.gov using the “eLibrary” link. Enter the docket number excluding the last three digits in the docket number field to access the document. For assistance, contact FERC at [email protected] or call toll-free, (886) 208-3676 or TYY, (202) 502-8659.

    Any questions regarding the application should be directed to David Haag, Vice President, Regulatory, Rockies Express Pipeline LLC, 370 Van Gordon Street, Lakewood, Colorado 80228-8304, phone (303) 763-3258.

    Specifically, the facilities for which Rockies Express is requesting NGA section 7(c) authority were the subject of two advance notification filings made by Rockies Express on August 26, 2013 in Docket No. CP13-539-000 (Seneca Lateral Project) and on April 18, 2014 in Docket No. CP14-194-000 (Seneca Compressor Expansion Project). The facilities consist of: (1) Approximately 14.7 miles of 24-inch lateral pipeline extending from an interconnect with MarkWest Energy Partners, L.P. Seneca Processing Plant to Rockies Express' mainline; (2) measurement facilities; and (3) 15,980 horsepower of booster compression. Rockies Express proposes incremental firm and interruptible transportation recourse rates based on the cost of the facilities of $135,950,429.

    Pursuant to section 157.9 of the Commission's rules, 18 CFR 157.9, within 90 days of this Notice the Commission staff will either: Complete its environmental assessment (EA) and place it into the Commission's public record (eLibrary) for this proceeding; or issue a Notice of Schedule for Environmental Review. If a Notice of Schedule for Environmental Review is issued, it will indicate, among other milestones, the anticipated date for the Commission staff's issuance of the final environmental impact statement (FEIS) or EA for this proposal. The filing of the EA in the Commission's public record for this proceeding or the issuance of a Notice of Schedule for Environmental Review will serve to notify federal and state agencies of the timing for the completion of all necessary reviews, and the subsequent need to complete all federal authorizations within 90 days of the date of issuance of the Commission staff's FEIS or EA.

    There are two ways to become involved in the Commission's review of this project. First, any person wishing to obtain legal status by becoming a party to the proceedings for this project should, on or before the comment date stated below file with the Federal Energy Regulatory Commission, 888 First Street NE., Washington, DC 20426, a motion to intervene in accordance with the requirements of the Commission's Rules of Practice and Procedure (18 CFR 385.214 or 385.211) and the Regulations under the NGA (18 CFR 157.10). A person obtaining party status will be placed on the service list maintained by the Secretary of the Commission and will receive copies of all documents filed by the applicant and by all other parties. A party must submit seven copies of filings made in the proceeding with the Commission and must mail a copy to the applicant and to every other party. Only parties to the proceeding can ask for court review of Commission orders in the proceeding.

    However, a person does not have to intervene in order to have comments considered. The second way to participate is by filing with the Secretary of the Commission, as soon as possible, an original and two copies of comments in support of or in opposition to this project. The Commission will consider these comments in determining the appropriate action to be taken, but the filing of a comment alone will not serve to make the filer a party to the proceeding. The Commission's rules require that persons filing comments in opposition to the project provide copies of their protests only to the party or parties directly involved in the protest.

    Persons who wish to comment only on the environmental review of this project should submit an original and two copies of their comments to the Secretary of the Commission. Environmental commentors will be placed on the Commission's environmental mailing list, will receive copies of the environmental documents, and will be notified of meetings associated with the Commission's environmental review process. Environmental commentors will not be required to serve copies of filed documents on all other parties. However, the non-party commentors will not receive copies of all documents filed by other parties or issued by the Commission (except for the mailing of environmental documents issued by the Commission) and will not have the right to seek court review of the Commission's final order.

    The Commission strongly encourages electronic filings of comments, protests and interventions in lieu of paper using the “eFiling” link at http://www.ferc.gov. Persons unable to file electronically should submit an original and seven copies of the protest or intervention to the Federal Energy Regulatory Commission, 888 First Street NE., Washington, DC 20426.

    Comment Date: 5 p.m. Eastern Time on April 2, 2015.

    Dated: March 12, 2015. Kimberly D. Bose, Secretary.
    [FR Doc. 2015-06207 Filed 3-17-15; 8:45 am] BILLING CODE P
    DEPARTMENT OF ENERGY Federal Energy Regulatory Commission [Docket No. ER15-1177-000] South Jersey Energy ISO7, LLC; Supplemental Notice That Initial Market-Based Rate Filing Includes Request for Blanket Section 204 Authorization

    This is a supplemental notice in the above-referenced proceeding, of South Jersey Energy ISO7, LLC's application for market-based rate authority, with an accompanying rate schedule, noting that such application includes a request for blanket authorization, under 18 CFR part 34, of future issuances of securities and assumptions of liability.

    Any person desiring to intervene or to protest should file with the Federal Energy Regulatory Commission, 888 First Street NE., Washington, DC 20426, in accordance with Rules 211 and 214 of the Commission's Rules of Practice and Procedure (18 CFR 385.211 and 385.214). Anyone filing a motion to intervene or protest must serve a copy of that document on the Applicant.

    Notice is hereby given that the deadline for filing protests with regard to the applicant's request for blanket authorization, under 18 CFR 34, of future issuances of securities and assumptions of liability is March 30, 2015.

    The Commission encourages electronic submission of protests and interventions in lieu of paper, using the FERC Online links at http://www.ferc.gov. To facilitate electronic service, persons with Internet access who will eFile a document and/or be listed as a contact for an intervenor must create and validate an eRegistration account using the eRegistration link. Select the eFiling link to log on and submit the intervention or protests.

    Persons unable to file electronically should submit an original and 5 copies of the intervention or protest to the Federal Energy Regulatory Commission, 888 First Street NE., Washington, DC 20426.

    The filings in the above-referenced proceeding(s) are accessible in the Commission's eLibrary system by clicking on the appropriate link in the above list. They are also available for review in the Commission's Public Reference Room in Washington, DC. There is an eSubscription link on the Web site that enables subscribers to receive email notification when a document is added to a subscribed docket(s). For assistance with any FERC Online service, please email [email protected]. or call (866) 208-3676 (toll free). For TTY, call (202) 502-8659.

    Dated: March 10, 2015. Nathaniel J. Davis, Sr., Deputy Secretary.
    [FR Doc. 2015-06128 Filed 3-17-15; 8:45 am] BILLING CODE 6717-01--P
    DEPARTMENT OF ENERGY Federal Energy Regulatory Commission [Docket No. ER15-1178-000] South Jersey Energy ISO8, LLC; Supplemental Notice That Initial Market-Based Rate Filing Includes Request for Blanket Section 204 Authorization

    This is a supplemental notice in the above-referenced proceeding, of South Jersey Energy ISO8, LLC's application for market-based rate authority, with an accompanying rate schedule, noting that such application includes a request for blanket authorization, under 18 CFR part 34, of future issuances of securities and assumptions of liability.

    Any person desiring to intervene or to protest should file with the Federal Energy Regulatory Commission, 888 First Street NE., Washington, DC 20426, in accordance with Rules 211 and 214 of the Commission's Rules of Practice and Procedure (18 CFR 385.211 and 385.214). Anyone filing a motion to intervene or protest must serve a copy of that document on the Applicant.

    Notice is hereby given that the deadline for filing protests with regard to the applicant's request for blanket authorization, under 18 CFR part 34, of future issuances of securities and assumptions of liability is March 30, 2015.

    The Commission encourages electronic submission of protests and interventions in lieu of paper, using the FERC Online links at http://www.ferc.gov. To facilitate electronic service, persons with Internet access who will eFile a document and/or be listed as a contact for an intervenor must create and validate an eRegistration account using the eRegistration link. Select the eFiling link to log on and submit the intervention or protests.

    Persons unable to file electronically should submit an original and 5 copies of the intervention or protest to the Federal Energy Regulatory Commission, 888 First Street NE., Washington, DC 20426.

    The filings in the above-referenced proceeding(s) are accessible in the Commission's eLibrary system by clicking on the appropriate link in the above list. They are also available for review in the Commission's Public Reference Room in Washington, DC. There is an eSubscription link on the Web site that enables subscribers to receive email notification when a document is added to a subscribed docket(s). For assistance with any FERC Online service, please email [email protected] or call (866) 208-3676 (toll free). For TTY, call (202) 502-8659.

    Dated: March 10, 2015. Nathaniel J. Davis, Sr., Deputy Secretary.
    [FR Doc. 2015-06129 Filed 3-17-15; 8:45 am] BILLING CODE 6717-01-P
    DEPARTMENT OF ENERGY Excess Uranium Management: Effects of DOE Transfers of Excess Uranium on Domestic Uranium Mining, Conversion, and Enrichment Industries; Notice of Issues for Public Comment AGENCY:

    Office of Nuclear Energy, Department of Energy.

    ACTION:

    Request for public comment.

    SUMMARY:

    The U.S. Department of Energy (DOE) plans to issue a new Secretarial Determination covering continued transfers of uranium for cleanup services at the Portsmouth Gaseous Diffusion Plant and for down-blending of highly-enriched uranium (HEU) to low-enriched uranium (LEU). In support of this process, DOE issued a Request for Information that solicited information about the effects of continued uranium transfers on the domestic uranium industries and recommendations about factors to be considered in assessing the possible impacts of DOE transfers. DOE also commissioned an economic analysis of the effects of its proposed uranium transfers. DOE now provides for public review the responses received from the public, the economic analysis prepared for DOE, and a list of factors DOE has identified for analysis of the impacts of DOE transfers on the uranium mining, conversion, and enrichment industries. DOE requests comment on this list of factors, the information and documents made available through this notice, and the included summary of information considered.

    DATES:

    DOE will accept comments, data, and information responding to this proposal submitted on or before April 6, 2015.

    ADDRESSES:

    Interested persons may submit comments by any of the following methods.

    1. Email: [email protected] Submit electronic comments in WordPerfect, Microsoft Word, PDF, or ASCII file format, and avoid the use of special characters or any form of encryption.

    2. Postal Mail: Mr. David Henderson, U.S. Department of Energy, Office of Nuclear Energy, Mailstop NE-52, 19901 Germantown Rd., Germantown, MD 20874-1290. If possible, please submit all items on a compact disk (CD), in which case it is not necessary to include printed copies.

    3. Hand Delivery/Courier: Mr. David Henderson, U.S. Department of Energy, Office of Nuclear Energy, MailstopNE-52, 19901 Germantown Rd., Germantown, MD 20874-1290. Phone: (301) 903-2590. If possible, please submit all items on a CD, in which case it is not necessary to include printed copies.

    No facsimiles (faxes) will be accepted. Supporting documents are available on the Internet at http://www.energy.gov/ne/downloads/excess-uranium-management.

    FOR FURTHER INFORMATION CONTACT:

    Mr. David Henderson, U.S. Department of Energy, Office of Nuclear Energy, Mailstop NE-52, 19901 Germantown Rd., Germantown, MD 20874-1290. Phone: (301) 903-2590. Email: [email protected]

    SUPPLEMENTARY INFORMATION:

    Table of Contents I. Introduction A. Excess Uranium Inventory B. Statutory Authority C. Procedural History D. Request for Information E. Market Analyses II. Analytical Approach A. Overview B. Factors for Consideration III. Summary of Information Under Consideration A. Uranium Mining Industry 1. Market Prices 2. Realized Prices of Current Operators 3. Production at Existing Facilities 4. Employment Levels in the Industry 5. Changes in Capital Improvement Plans and Development of Future Facilities 6. Long-Term Viability and Health of the Industry B. Uranium Conversion Industry 1. Market Prices 2. Realized Prices of Current Operators 3. Production at Existing Facilities 4. Employment Levels in the Industry 5. Changes in Capital Improvement Plans and Development of Future Facilities 6. Long-Term Viability and Health of the Industry C. Enrichment Industry 1. Market Prices 2. Realized Prices of Current Operators 3. Production at Existing Facilities 4. Employment Levels in the Industry 5. Changes in Capital Improvement Plans and Development of Future Facilities 6. Long-Term Viability and Health of the Industry IV. Request for Comments V. Confidential Business Information I. Introduction A. Excess Uranium Inventory

    The Department of Energy (DOE) holds inventories of uranium in various forms and quantities—including low-enriched uranium (LEU) and natural uranium—that have been declared as excess and are not dedicated to U.S. national security missions. Within DOE, the Office of Nuclear Energy (NE), the Office of Environmental Management (EM), and the National Nuclear Security Administration (NNSA) coordinate the management of these excess uranium inventories. DOE explained its approach to managing this inventory in a July 2013 Report to Congress, Excess Uranium Inventory Management Plan (2013 Plan).

    Much of this excess uranium has substantial economic value on the open market. One tool that DOE has used to manage its excess uranium inventory has been to enter into transactions in which DOE exchanges excess uranium for services. This notice involves uranium transfers of this type under two separate programs. Specifically, DOE transfers uranium in exchange for cleanup services at the Portsmouth Gaseous Diffusion Plant and for down-blending of highly-enriched uranium (HEU) to LEU. DOE currently transfers uranium for these two programs at an aggregate rate of approximately 2,705 metric tons of natural uranium equivalent (MTU) per year.1

    1 With respect to a given amount of LEU, the “natural uranium equivalent” is the amount of natural uranium feed that would be required to produce that amount of LEU. The ratio of feed to product is a function of the assay of the feed and the desired assays of the enriched product and the depleted tails (“assay” refers to the ratio of the fissile isotope U-235 to other isotopes of uranium such as U-234 and U-238). The industry generally refers to the enriched product as “Enriched Uranium Product” or EUP and to the tails as “depleted uranium,” DU, “depleted uranium hexafluoride” or DUF6.

    B. Statutory Authority

    DOE manages its excess uranium inventory in accordance with the Atomic Energy Act of 1954 (42 U.S.C. 2011 et seq., “AEA”) and other applicable law. Specifically, Title I, Chapters 6-7, 14, of the AEA authorize DOE to transfer special nuclear material and source material. LEU and natural uranium are types of special nuclear material and source material, respectively. The USEC Privatization Act (Pub. L. 104-134, 42 U.S.C. 2297h et seq.) places certain limitations on DOE's authority to transfer uranium from its excess uranium inventory. Specifically, under section 3112(d)(2)(B) of the USEC Privatization Act (42 U.S.C. 2297h-10(d)(2)(B)), the Secretary must determine that the transfers “will not have an adverse material impact on the domestic uranium mining, conversion or enrichment industry, taking into account the sales of uranium under the Russian Highly Enriched Uranium Agreement and the Suspension Agreement” before DOE makes certain transfers of natural or low-enriched uranium under the AEA. Section 306(a) of Division D, Title III of the Consolidated and Further Continuing Appropriations Act, 2015 (Pub. L. 113-235), limits the validity of any determination by the Secretary under Section 3112(d)(2)(B) of the USEC Privatization Act to no more than two calendar years subsequent to the determination.

    C. Procedural History

    In accordance with the above statutes and other laws, the Secretary has periodically determined whether certain transfers of natural and low-enriched uranium will have an adverse material impact on the domestic uranium industries. DOE issued the most recent Secretarial Determination in May 2014. That determination covered transfers of up to a total of 2,705 MTU per year natural uranium equivalent, broken down as follows: Up to 650 MTU per year of natural uranium equivalent in the form of LEU transferred for downblending, with the balance, but not less than 2,055 MTU per year of natural uranium equivalent for cleanup services at the Paducah or Portsmouth Gaseous Diffusion Plant.2 At this time, DOE is conducting uranium transfers consistent with the May 2014 Secretarial Determination.

    2 See May 15, 2014, Secretarial Determination.

    To inform the May 2014 Secretarial Determination—as it had for a number of previous determinations—DOE tasked Energy Resources International, Inc. (ERI) with assessing the potential effects on the domestic uranium mining, conversion, and enrichment industries from DOE's proposed volume of uranium transfers. In addition to its review and consideration of the report prepared by ERI (2014 ERI Report), DOE held in-person meetings and accepted written communications regarding the transfers from several entities that expressed an interest in DOE's proposed uranium transactions. DOE staff then prepared a separate analysis based on these and other inputs and recommended a course of action to the Secretary.

    DOE plans to issue a new Secretarial Determination pursuant to section 3112(d). As a preparatory step, DOE sought information from the public through a Request for Information published in the Federal Register on December 8, 2014 (79 FR 72661). DOE is now soliciting additional public input.

    D. Request for Information

    In the December 8, 2014, Request for Information (79 FR 72661), DOE solicited information from interested stakeholders and specifically requested comment on the following seven questions.

    (1) What factors should DOE consider in assessing whether transfers will have adverse material impacts?

    (2) With respect to transfers from DOE's excess uranium inventory in calendar years 2012, 2013, and 2014, what have been the effects of transfers in uranium markets and the consequences for the domestic uranium mining, conversion, and enrichment industries relative to other market factors?

    (3) What market effects and industry consequences could DOE expect from continued transfers at annual rates comparable to the transfers described in the 2014 Secretarial Determination?

    (4) Would transfers at a lower annual rate significantly change these effects, and if so, how?

    (5) Are there actions DOE could take other than altering the annual rate of transfers that would mitigate any negative effects on these industries?

    (6) Are there actions DOE could take with respect to transfers that would have positive effects on these industries?

    (7) Are there any anticipated changes in these markets that may significantly change how DOE transfers affect the domestic uranium industries?

    In response to this request, DOE received comments from a diverse group of parties representing interests across the nuclear industry. DOE received comments from members of the uranium mining, conversion, and enrichment industries. DOE also received comments from trade associations, nuclear utilities, local governmental bodies, and members of the public. All comments are available at http://www.energy.gov/ne/downloads/excess-uranium-management. 3

    3 Some comments were marked as containing confidential information. Those comments are provided with confidential information removed.

    E. Market Analyses

    In preparation for the May 2014 Secretarial Determination, DOE tasked ERI to assess the potential effects on the domestic uranium mining, conversion, and enrichment industries of the introduction of DOE excess uranium inventory in various forms and quantities through sale or transfer during calendar years 2014 through 2033. DOE may consider this report in its deliberations regarding a new Determination (“2014 ERI Report”).

    In preparation for the planned Secretarial Determination that is the subject of today's notice, DOE tasked ERI with preparing an additional analysis of DOE transfers (“2015 ERI Report”). For this additional analysis, DOE tasked ERI to consider the effect of hypothetical DOE transfers on the domestic uranium industries under three different scenarios. Under Scenario 1, DOE would continue transfers at the current annual rate of 2,705 MTU per year, consisting of 2,055 MTU for cleanup work and 650 MTU as low-enriched uranium for downblending. Under Scenario 2, DOE would decrease transfers to a rate corresponding with 1,855 MTU per year, consisting of 1,410 MTU for cleanup work and 445 MTU as low-enriched uranium for downblending. Under Scenario 3, DOE would cease transfers for cleanup work and downblending.

    DOE also asked ERI to provide specific categories of information in its analysis, including a discussion of price volatility and regional differences in the markets. DOE tasked ERI to discuss the implications of changing certain assumptions underlying its analysis, specifically regarding what proportion of DOE material would enter the global as compared to the domestic market and regarding the share of DOE material delivered under long-term contracts. ERI's report also includes updated information regarding changes in the market between April 2014 and February 2015. Both the 2014 ERI Report and the 2015 ERI Report can be found at http://www.energy.gov/ne/downloads/excess-uranium-management.

    II. Analytical Approach

    DOE issues Secretarial Determinations pursuant to Section 3112(d) of the USEC Privatization Act. Section 3112(d) states that DOE may transfer “natural and low-enriched uranium” if, among other things, “the Secretary determines that the sale of the material will not have an adverse material impact on the domestic uranium mining, conversion, or enrichment industry, taking into account the sales of uranium under the Russian HEU Agreement and the Suspension Agreement.” After considering this statutory language, DOE has developed a set of factors that it proposes to consider in determining whether its uranium transfers will have an “adverse material impact” on the domestic uranium industries.

    A. Overview

    The USEC Privatization Act does not clearly indicate what kind or degree of effect or influence on an industry would constitute an “adverse material impact.” As discussed below, these words are susceptible of many meanings. Contextual clues provide some guidance in understanding the phrase, but DOE has not identified context (such as a statutory definition) that would unambiguously settle what an “adverse material impact” is.

    Moreover, the meaning of the phrase is likely to depend in part on the factual context in which it is to be applied. Uranium transactions can take myriad forms, and the effect of any given transaction on any one or all of these industries will depend heavily on the facts and circumstances at the time of the transaction. DOE's inventory of uranium is changing over time, and Congress could not have anticipated the specific characteristics of every potential transaction. Thus, it would be unsurprising for the statute to describe DOE's mandate in open-ended terms, leaving DOE to elaborate details as and when DOE applied the statute over time.

    Thus, the Secretary will need to exercise judgment to develop an understanding of “adverse material impact,” in its statutory context, as applicable to a given potential transfer or sale of uranium. Part of that task involves establishing an analytical framework to form the basis of and reach a determination about the impacts of DOE's transfers. The Secretary is responsible for reviewing relevant information and exercising judgment to decide whether a particular sale or transfer will have an adverse material impact.

    DOE's first step in developing an analytical framework is to elaborate what it means for transfers to “have” an “impact.” DOE believes that it can appropriately fulfill the purpose of the statute by reading this phrase to refer to “impacts” that have a causal relationship to DOE transfers. The overall thrust of Section 3112 is to permit transfers and sales of uranium to the degree consistent with various policy considerations set forth in various paragraphs.4 Section 3112(d) calls for the Secretary's predictive judgment, before DOE engages in a transaction, whether the transaction will have an adverse material impact on the domestic uranium industries. The notion of causation is implicit in this structure. If domestic industries would experience a given negative condition regardless whether DOE made a particular transfer, it would ill serve the purposes of the USEC Privatization Act for 3112(d) to block the transfer.

    4 In passing the USEC Privatization Act, Congress recognized that DOE would have a substantial uranium inventory after privatization. Congress included Section 3112(d) to ensure that DOE could continue to use sales or transfers from its uranium inventory as a management tool. See S. Rep. 104-173, at 16-17; see also 141 Cong. Rec. S6106-07 (daily ed. May 3, 1995) (statement of Sen. Domenici).4

    Thus, in assessing a given transfer, DOE will essentially evaluate two forecasts: One reflecting the state of the domestic uranium industries if DOE goes forward with the transfer, and one reflecting the state of the domestic uranium industries if DOE does not go forward with the transfer. DOE will then compare these two forecasts to determine the relevant impacts on the domestic uranium industries. It bears mention that not every difference in predicted outcomes will necessarily count as an impact of the transfer. For example, if DOE transfers would be the final contribution after independent causes have pushed an industry to a given adverse state, DOE might not regard the full scope of the adversity as attributable to the transfers.

    With respect to assessing whether the adverse impacts of a transfer would be “material,” DOE observes that the word “material” is used to denote situations “of real importance or great consequence.” See Webster's Third New International Dictionary 31, 1392 (1961). How large consequences must be to qualify as “material” varies in different legal contexts. In light of the overall goals and structure of the USEC Privatization Act, DOE believes it is reasonable to view material adverse impacts as referring to impacts that go beyond normal market fluctuations, such as those that threaten the viability of an industry.

    As noted above, one purpose of the USEC Privatization Act was that DOE should manage and eventually dispose of the large legacy inventory that the privatization of USEC would leave it. In privatizing the United States Enrichment Corporation, Congress recognized that DOE would have uranium inventory left over and that this inventory would have substantial economic value. By including 3112(d), Congress preserved the Secretary's discretion to utilize uranium transfers as a tool in managing the uranium inventory, and the substantial value embodied therein. If Congress had not wanted DOE to make productive use of its inventory, it could have prohibited all sales by the Department with or without a determination. Indeed, the USEC Privatization Act explicitly directed DOE to transfer various quantities of uranium to market participants. 42 U.S.C. 2297h-10(b)(2) & (c).

    Section 3112 also provides helpful context that indicates the magnitude of industry impact that Congress considered acceptable. The statute specifically authorized material delivered under the Russian HEU Agreement to enter the U.S. market notwithstanding a preexisting suspension agreement limiting the entry of this material. 42 U.S.C. 2297h-10(b)(3), (5)-(7). The act contained annual limits on deliveries of the natural uranium component of the Russian material. The limits started at 2 million pounds U3O8 equivalent in 1998, and increased by 2 million pounds each year reaching a maximum of 20 million pounds U3O8 equivalent in 2009 and each year thereafter. 42 U.S.C. 2297h-10(b)(5).5 For comparison purposes, this last figure represented over four times the volume of U3O8 produced at U.S. mines in 1996, the year the statute was passed. EIA, Domestic Uranium Production Report (2005). The size of this explicit authorization informs DOE's understanding of what impacts Congress would have regarded as “material.” It seems unlikely that Congress would have authorized in 3112(b) transfers that would have been inconsistent with the policy goals of 3112(d).

    5 Sales under the Russian HEU Agreement ceased at the end of 2013.

    Indeed, the structure and legislative history of 3112(b) confirm that the schedule for Russian material's entering domestic markets reflects Congress's balancing of concerns similar to those that motivated 3112(d)(2). Congress could have simply allowed all Russian material into the U.S. without limitation. Instead, Congress provided a schedule that ramped up over a period of 20 years. Thus, Congress was attempting to balance the competing concerns of providing a market for the consumption of downblended Russian HEU and protecting the domestic uranium industries from large-scale disruption. The schedule outlined in Section 3112(b) reveals the level of market interference that Congress believed struck that balance. This notion is further confirmed by the legislative history of this provision, which specifically states that Congress was trying to balance the interests in maintaining the Russian HEU Agreement with the interests of the domestic uranium industries. See S. Rep. 104-173, at 14. Further, the legislative history explains that the schedule of maximum deliveries was designed to protect against disruptions to the uranium markets by providing a “reasonable, predictable, and measured introduction of this Russian material into the domestic uranium market.” Id. at 28.

    Section 3112(d)(2) confirms that DOE's consideration of 3112(b) in interpreting 3112(d)(2) is reasonable. Section 3112(d)(2) explicitly directs the Secretary to “take into account” the sales of uranium under the Russian HEU Agreement and the Suspension Agreement. DOE believes that in addition to requiring the Secretary to consider any transfers under these programs that are ongoing at the time of DOE's transfers, this language asks the Secretary to consider and take into account the history and context of these transfers and the statutory text authorizing them. In addition, it bears mention that in a 3112(d)(2) deliberation DOE may take account of the fact that the cessation of the Russian HEU Agreement removed a substantial amount of secondary supply from uranium markets.

    The preceding discussion is not intended automatically to support transfers of up to 20 million pounds under Section 3112(d). The Secretary must exercise his own judgment as to whether transfers would cause an adverse material impact, in light of market and industry conditions today. However, DOE believes that this provision provides some insight into what scale of market interference Congress considered acceptable, and hence would not constitute an “adverse material impact.”

    For these reasons, DOE believes that whether the effects of a given transfer constitute an “adverse material impact” should not depend on a quantitative bright-line test, but rather should be based on an evaluation of potential impacts by examining a number of factors. Accordingly, DOE proposes to consider the effects of DOE transfers using a set of factors. DOE proposes to analyze its transfers in light of the best available information, data and expert judgment to form the basis for the Secretary's determination.

    B. Factors for Consideration

    In the December 2014 RFI, DOE sought comment from the public on what factors it should consider in assessing whether a given set of transfers would have an adverse material impact on the domestic uranium industries. After considering the comments received, DOE believes the following factors may be relevant to this question:

    1. Market prices 2. Realized prices of current operators 3. Production at existing facilities 4. Employment levels in the industry 5. Changes in capital improvement plans and development of future facilities 6. Long-term viability and health of the industry

    These factors reflect many of those suggested by commenters, and DOE believes they reflect the types of impacts that a DOE transfer could in principle have on a domestic uranium industry. Not every factor will necessarily be relevant on a given occasion or to a particular industry; DOE intends this list of factors only as a guide to its analysis. DOE is open to additional comment on these factors. There are a few factors proposed by commenters that are not included in DOE's list, for the reasons outlined below.

    One commenter suggested that DOE should consider the effects of its transfers on the profitability of the industries. Comment of ConverDyn, Encl. at 2. Another commenter suggested that DOE should consider the effect of its transfers on gross profit margin. TradeTech Report, 12-13. DOE notes that profit and profitability can vary depending on company-specific circumstances and accounting treatments, and therefore may not be reliable indicators of how a given market phenomenon like DOE transfers is affecting an industry. Moreover, for assessing the impact on an industry, the profit of participants is, in a sense, an indirect measure, as it is principally a link between market dynamics—prices and sales—and the ultimate reaction of industry in terms of increasing or decreasing activity. For these reasons, DOE proposes to look instead at factors which are either more directly related to industry impact or are more reliable predictors of industry impact.

    Several commenters suggested that DOE should consider current market conditions as a factor. Comment of UPA, at 3; comment of Uranerz, at 3. DOE agrees that current market conditions are relevant, and DOE plans to consider the potential effects of DOE transfers in light of the relevant context, which includes current market conditions as well as past and projected future conditions. DOE believes that considering broader market conditions in this manner will yield insight into how the domestic uranium industries can be expected to respond to DOE transfers.

    Some commenters suggested that DOE consider uncommitted utility demand or uncovered utility requirements compared to the level of DOE transfers. UPA and others, for example, stated that transfers at the rate described in the May 2014 Secretarial Determination would constitute more than 100 percent of global uncommitted utility demand in calendar year 2015 and almost 60 percent in 2016. These commenters cite to a report by the Ux Consulting Company, LLC (UxC): UxC Uranium Market Outlook—Q4 2014 (2014).6 Comment of UPA, at 2-3; see also comment of Uranerz Energy Corp., at 2-3; comment of Signal Equities, at 2.7 Similarly, URENCO USA Inc. (URENCO)—citing UxC's Q4 Enrichment Market Outlook—stated that DOE transfers of LEU will constitute 72% of uncovered enrichment requirements in 2015. Comment of URENCO, at 4.8 While the volume of uncovered requirements may be information relevant to the overall assessment, DOE is not convinced a particular comparison between that volume and the magnitude of a proposed transfer is reliable as an indication of the impacts of its transfers on the uranium industries. It is far from clear that uranium from proposed DOE transfers in 2015 and 2016 would be sold only to utilities with uncovered requirements in the year of transfer. The market involves many participants other than utilities seeking to fill uncovered requirements. For example, intermediaries that hold mid- or long-term contracts may need to purchase material on the spot market to fulfill contracted deliveries. As discussed below, some market participants—such as China—purchase material in excess of their requirements. Traders and investment funds may also make purchases independent of reactor requirements.9 Thus, spot demand in any given year may substantially exceed uncovered requirements. At least for the uranium industry, this is confirmed by the very report that commenters cite to in their comments. UxC projects that spot demand in 2015 and 2016 will be significantly higher than uncovered requirements in both years. Compare Table 14 with Table 15 of UxC Uranium Market Outlook—Q4 2014, 62-63 (2014). In addition, the company that currently distributes on the broader market most of the uranium that DOE is transferring under the 2014 Secretarial Determination represents that it has already sold almost all of this material to utilities under forward delivery contracts. Comment of Traxys, at 1.10 Therefore, the global uncommitted utility figures cited by UPA and others presumably already take account of DOE transfers as an element of covered requirements.11

    6 UPA refers to “uncommitted utility demand.” It appears that they are referring to UxC's estimate of uncovered reactor requirements, found at UxC Uranium Market Outlook—Q4 2014, 61-62 (2014).

    7 Commenters cite to UxC's Q3 Uranium Market Outlook. In addition to UxC's most recent estimate of uncovered utility uranium requirements, UxC Uranium Market Outlook—Q4 2014, 61-62 (2014), DOE has reviewed information from EIA and the Euratom Supply Agency. EIA, 2013 Uranium Marketing Report, 34 (2014); ESA, Natural Uranium Coverage 2014-2022, available at http://ec.europa.eu/euratom/docs/F9-CoverageRate.xls.

    8 DOE has reviewed UxC's most recent estimate of uncovered enrichment requirements found at: UxC Enrichment Market Outlook—Q4 2014, 39-40 (2014). DOE also notes that UxC's most recent report on the conversion market does not include updated numbers on uncovered utility requirements for conversion services. UxC Conversion Market Outlook—December 2014, 37 (2014).

    9 Comparing the financial statements of Uranium Production Corporation—a uranium investment fund—reveals that between November 30, 2013, and November 30, 2014, UPC increased its stock by approximately 1.5 million pounds U3O8 equivalent—1,311,286 pounds U3O8 and 261,285 pounds U3O8 equivalent contained within 100,000 kgU of UF6. UPC, 2015 Third Quarter Report, 2 (2015), available at http://www.uraniumparticipation.com/i/pdf/financials/2015-Q3-Report-for-the-Three-Months-Ended-November-30.pdf; UPC, 2014 Third Quarter Report, 2 (2014), available at http://www.uraniumparticipation.com/i/pdf/financials/2014-Q3.pdf. UPC's stated investment strategy is to buy and hold uranium rather than actively trading in response to short-term shifts in prices. UPC, Investor Update Presentation, 17 (Aug. 2014), available at http://www.uraniumparticipation.com/i/pdf/ppt/UPC-Investor-Update-August-2014.pdf.

    10 Traxys North America LLP has a contractual arrangement with DOE's contractor at Portsmouth, Fluor-B&W Portsmouth, to purchase all uranium hexafluoride FBP receives from DOE. The existence of FBP's contract with Traxys does not obligate DOE to transfer to FBP the amounts of uranium under consideration.

    11 Traxys represented that it had already sold to utilities “almost 100%” of the material from DOE as early as July 7, 2014. Declaration of Kevin P. Smith, ConverDyn v. Moniz, Case no. 1:14-cv-01012-RBW, Document 17-7 at ¶6 (July 7, 2014). The figures for global uncommitted utility demand cited by UPA were released after this date. See Comment of UPA, at 3 n.2.

    Commenters also proposed share price and market capitalization as factors for consideration. E.g., Comment of ConverDyn, Enclosure, at 2. DOE is not convinced that either of these provides an appropriate indicator for whether DOE transfers will cause an adverse material impact, because both market capitalization and share price are too attenuated from the effects of DOE transfers. While share price certainly does influence a company's decisions about investment and allocation of capital, it is only one factor. At the same time, a company's share price tends to reflect myriad inputs besides the effects of a market phenomenon like DOE transfers. Other contributions to share price can include the nature of company management, gearing ratio (debt vs. equity), inflation, and the particular risks associated with the uranium market (such as the influence of political changes, like the shift in energy policy in Germany or public responses to nuclear accidents). Furthermore, many of the largest U.S. producers are part of multi-line companies whose share prices depend in part on product markets other than uranium. For these reasons, DOE believes that share price and market capitalization are too highly attenuated to serve as useful proxies for industry impact.

    Some commenters suggested that DOE should consider the “spill-over effects” across the different nuclear fuel industries that might cause indirect harm. E.g., Comment of URENCO, at 5. Although the commenter did not explain what “spill-over effects” it was referring to, DOE recognizes that as a general matter the interaction between the different uranium markets can be relevant, particularly the relationship between enrichment prices and uranium concentrate/conversion prices. As enrichment can be used to provide additional uranium concentrate as uranium hexafluoride—either through underfeeding or re-enrichment of tails—there is a potential for changes in one market to affect the others. However, DOE does not believe this should be considered as a separate factor. Instead, DOE believes these effects are better understood and assessed when considered as part of the analysis for each of the six market factors listed above.

    III. Summary of Information Under Consideration

    In this section, DOE summarizes for each industry the information that DOE believes to be relevant with respect to the above-listed factors. In addition to the 2014 ERI Report, the 2015 ERI Report, and the comments received in response to the RFI, in some instances DOE refers to additional information from other sources. Where available, DOE provides a link to where these documents are available on the Internet.

    A. Uranium Mining Industry 1. Market Prices

    In preparation for the proposed Secretarial Determination, DOE tasked ERI with estimating the effect of DOE transfers on the market prices for uranium concentrates. In the 2015 ERI Report, as in previous reports, ERI estimated this effect by employing two different types of model that rely on somewhat different assumptions: A market clearing price model and an econometric model. For its market clearing price model, ERI constructs individual supply and demand curves and compares the clearing price with and without DOE transfers.12 To develop its supply curves, ERI gathers available information on the costs facing each individual supply source. ERI then uses that information to estimate the marginal cost of supply for each source using a discounted cash flow model. 2015 ERI Report, 41 n.22. To develop its demand curve, ERI assumes a perfectly inelastic demand curve based on its Reference Nuclear Power Growth forecast.13 ERI develops this forecast by combining estimates of the needs and reload schedules for operating plants with projections about future reactor retirements and new development. 2015 ERI Report, 17-18.

    12 The market clearing price is the price at which quantity supplied is equal to quantity demanded.

    13 In other words, ERI assumes that demand for uranium will stay the same regardless of variations in market price.

    Applying this approach to the three scenarios listed in Section I.E above—2,705 MTU per year (scenario 1), 1,855 MTU per year (scenario 2), or zero transfers (scenario 3)—ERI estimates that DOE transfers will have the effects listed in Table 1. Transfers at the rate of 2,705 MTU per year would cause the price of uranium concentrates to be lower than it would be without DOE transfers by, on average, $2.80 between 2015 and 2024—with prices being $3.00 and $2.80 lower in 2015 and 2016 specifically. 2015 ERI Report, 45. For DOE transfers at a rate of 1,855 MTU per year, ERI estimates that prices would be, on average, $2.60 lower between 2015 and 2024—with prices being $2.10 and $1.90 lower in 2015 and 2016 specifically. If DOE ceased transfers under these two programs, ERI estimates that prices would be, on average, $1.30 lower between 2015 and 2024—with prices being $0.30 and $0.10 lower in 2015 and 2016 specifically.14 It is important to emphasize that this is not a prediction that prices will drop by the specified amount once DOE begins transfers following a new determination. A level of price suppression consistent with the estimate for Scenario 1 would, on ERI's analysis, already be reflected in the current market price because DOE is currently transferring uranium at that rate. 2015 ERI Report, 44. This means that if DOE continued transferring at Scenario 1 levels, the market prices would not change; if DOE began transferring at Scenario 2 levels, the market price would be expected to rise by approximately $0.90; if DOE ceased transfers under these programs, market prices would be expected to rise by $2.70. See Table 4.1 of 2015 ERI Report, 45. These prices represent ERI's prediction of the average effect over the next decade, rather than for any given year.

    14 Note that the transfer rates in these scenarios refer only to the level of uranium transfers for cleanup at Portsmouth and downblending of LEU. They do not include transfers for three other programs, TVA BLEU, Energy Northwest depleted uranium, and a possible future sale of depleted uranium currently under negotiation. 2015 ERI Report, 21-32. The level of transfers across these three programs is the same in all three scenarios. ERI's predictions about market price reflect these transfers as well as the Portsmouth and downblending transfers.

    Table 1—ERI's Estimate of Effect of DOE Transfers on Uranium Concentrate Spot and Term Prices in  $  per Pound U3O8 [Market clearing approach] 2015 ERI Report Estimated
  • price effect
  • (2015-2024)
  • 2014 ERI Report Estimated
  • price effect
  • (2014-2023)
  • Scenario 1 $2.80 $2.90 Scenario 2 2.60 Scenario 3 1.30

    ERI then compares these numbers to the current spot and term price indicators published by TradeTech on January 31, 2015—i.e. $37.25 per pound U3O8 on the spot market, and $50.00 per pound U3O8 on the term market. As a percentage of the current prices, the average price effect attributable to DOE's transfers over the period 2015-2024 under Scenario 1 represents approximately 7.6% of the current spot price and 5.7% of the current term price. Under Scenario 2, the average price effect over the same period represents 7.1% of the spot price and 5.3% of the term price. Under Scenario 3, the average price effect represents 3.6% of the spot price and 2.7% of the term price. 2015 ERI Report, 47, 49.

    The second model that ERI used to predict the effects of DOE transfers specifically on the spot price for uranium using an econometric model. A summary of ERI's estimates using this model appears in Table 2. ERI compared the monthly spot and term market prices published by TradeTech with published offers to sell uranium for delivery within one year of publication and published inquiries to purchase uranium for delivery within one year. Based on this information, ERI developed a multivariable correlation to estimate how the market prices would respond to the availability of new supply from DOE. 2015 ERI Report, 50. Applying this econometric model, ERI predicts that transfers under Scenario 1 would cause the spot price to be lower by about $2.40 per pound between 2015 and 2017 than it would be in the absence of transfers, and by about $5.10 between 2018 and 2024. For Scenario 2, ERI estimated that the spot price would be lower by about $1.70 per pound between 2015 and 2017 than it would be without transfers, and by about $4.80 between 2018 and 2024. For Scenario 3, ERI estimated that the spot price would be lower by about $0.30 per pound between 2015 and 2017, and by $2.00 between 2018 and 2024. 2015 ERI Report, 53. Again, as noted for the market clearing analysis, the market price currently takes account of the already ongoing transfers at the levels of Scenario 1. Thus, on ERI's analysis prices already exhibit a level of price suppression similar to the level predicted in the near term under Scenario 1. 2015 ERI Report, 52-53.

    Table 2—ERI's Estimate of Effect of DOE Transfers on Uranium Concentrate Spot Price in  $  per  Pound  U3O8 [Econometric model] 15 2015 ERI Report Estimated price effect
  • (2015-2017)
  • Estimated price effect
  • (2018-2024)
  • 2014 ERI Report Estimated price effect
  • (2014-2016)
  • Estimated price effect
  • (2017-2021)
  • Scenario 1 $2.40 $5.10 $2.80 $5.50 Scenario 2 1.70 4.80 Scenario 3 0.30 2.00

    15 It is more appropriate to compare the estimated price effect to the forecasted market price at the time of the effect. ERI's report does not provide specific quantifications of the forecasted market price in out-years. Thus, it is not possible to list the percentage of expected market price with specificity. However, DOE notes that, at least with respect to the later term projections, ERI predicts that market prices will be in the $52 to $57 range after 2017. 2015 ERI Report, 52; 2014 ERI Report, 44.

    For the 2014 ERI Report, ERI had conducted a similar market clearing approach for a level of transfers that is equal to Scenario 1 of the 2015 ERI Report. Although that report used slightly older data, the results are very similar. Notably, ERI estimated that the price effect attributable to DOE transfers at the current rates is $2.90 between 2014 and 2023—with prices being $3.00 lower in 2014 and 2015, and $2.80 lower in 2016.16 2014 ERI Report, 40. ERI also conducted a similar econometric analysis for a level of transfers that is equal to Scenario 1. 2014 ERI Report, 42-45. The econometric analysis in the 2014 ERI Report estimated a slightly higher price effect compared to the 2015 Report. Specifically, ERI estimated that DOE transfers would cause the spot price to be lower by about $2.80 per pound between 2014 and 2016, and by about $5.50 between 2017 and 2021. 2014 ERI Report, 44. The updated analysis in the 2015 ERI Report produces slightly different figures because it relies on updated estimates of the amount of DOE material expected to affect the markets. Compare Table 3.4 of 2014 ERI Report, 33, with Tables 3.6, 3.7, and 3.8 of 2015 ERI Report, 32-34.

    16 ERI also compared those numbers to then current term and spot price indicators as of March 31, 2014. At that time, the TradeTech price indicator was $34.00 per pound U3O8 on the spot market and $45.00 per pound U3O8 on the term market. 2014 ERI Report, 23.

    Three commenters provided their own estimates of the price effects of DOE transfers.

    UPA attached to its comment a market analysis it commissioned from TradeTech, LLC, a uranium market consultant. Comment of UPA, Attachment, TradeTech, “UPA DOE Material Transfer Study” (2015) (hereinafter “TradeTech Report”). A summary of TradeTech's estimates appears in Table 3. TradeTech explains that it estimated the price effect of DOE transfers using its proprietary Dynamic Pricing Model. This model is an econometric forecasting approach to estimate the equilibrium between two dimensions TradeTech calls “active supply” and “active demand.” In its estimates, TradeTech assumes that 50 percent of DOE transfers enters the spot market and 50 percent enters the term market. TradeTech Report, 14. Using its model, TradeTech estimates that DOE's transfer reduced the spot price by an average of $3.55 per pound between January 2012 and December 2014. TradeTech Report, 15. TradeTech also estimates that continued DOE transfers at current rates would reduce the spot price by an average of $2.43 per pound between January 2015 and December 2016. TradeTech Report, 20.

    TradeTech also provides estimates for the effect of DOE transfers at several decreased transfer rates. If DOE transfers decreased to 75% of current levels, TradeTech estimates that the spot price would increase by an average of $0.53 per pound between January 2015 and December 2016. TradeTech Report, 26.17 Based on TradeTech's estimate of the price suppression of DOE transfers at current levels, it appears that TradeTech is estimating that price suppression at 75% of current levels would be $1.90. If DOE transfers decreased to 50% of current levels, TradeTech estimates that the spot price would increase by an average of $1.10 per pound between January 2015 and December 2016. TradeTech Report, 25. This corresponds to a price suppression of $1.33. If DOE transfers decreased to 25% of current levels, TradeTech estimates that the spot price would increase by an average of $1.73 per pound between January and 2015 and December 2016. TradeTech Report, 24. This corresponds to a price suppression of $0.70.

    17 Figures 16-19 of the TradeTech Report show TradeTech's estimates for the price impact at a range of different transfer rates. Although these charts and the related text refer to “Transfers at [25, 50, or 75] Percent of Established 2014 Volumes,” it appears that these charts actually reflect an estimate for a 25%, 50%, or 75% decrease relative to current levels, rather than transfers at the specified percentage of current levels.

    Table 3—TradeTech's Estimate of Effect of DOE Transfers on Uranium Concentrate Spot Price in $ per Pound U3O8 TradeTech report Transfer rate
  • (compared to current)
  • Estimated price effect
  • (2015-2016)
  • 100% $2.43 75% 1.90 50% 1.33 25% 0.70

    Fluor-B&W Portsmouth attached to its comment an April 2014 market analysis from NAC International (NAC). Comment of Fluor-B&W Portsmouth, Attachment A, NAC International, “Impact of DOE Excess Uranium Sales on the U3O8 Market” (April 2014) (hereinafter “NAC Report”).18 In its analysis, NAC based its production cost estimates on its Uranium Supply Analysis System (USAS). NAC updates this model each year based on a review of various published reports and presentations. NAC then applies cost models to derive specific cost estimates for individual properties. NAC Report, C-1. Specifically, NAC applies a discounted cash flow rate of return model based on both full cost (including sunk costs) and forward costs for each property. NAC Report, C-2 to C-3. NAC also utilized an estimate of reactor requirements and uncommitted demand developed from its Fuel-Trac database. NAC Report, D-1.

    18 As this report was prepared in April 2014, it does not contain updated information on developments in the markets since that time. The level of uranium transfers that it analyzes is based on the levels specified in the May 2012 Secretarial Determination, which is roughly similar to the current rate of transfers. NAC Report, A-1 to A-3.

    NAC developed a range of estimates of the impact of DOE transfers utilizing its production cost estimates at three different rates: 2,800 MTU per year, 2,400 MTU per year, and 10% of U.S. reactor requirements. NAC Report, 3-21 to 3-22. First, NAC applied a methodology it believes approximates ERI's approach to its own cost estimates. Specifically, NAC identified the incremental cost of the last property needed to meet demand in a given year based on total supply and demand. NAC Report, 3-22. NAC then explains that because long-term contracts with fixed pricing mechanisms have allowed some high-cost producers to produce ahead of lower cost supply, it believes a better approach is to base the model on uncommitted supply and demand. NAC then applies a multiplier to these estimates to account for additional incremental costs not included in its site forward production costs estimate. These additional costs include increased site forward costs due to operation at less than nominal capacity, taxes, corporate overhead, and variations in the required rate of return. NAC Report, 3-23. NAC also applies a time shift to the cost trend to account for the fact that producers need a price signal before investing in a new production center—i.e. producers need to have prices that justify an investment before actually making the investment. NAC Report, 3-24. The specific quantitative impact projected by NAC is withheld from the public version of the NAC Report to protect confidential information.

    Cameco attached to its comment a market analysis it commissioned from Ux Consulting Company, LLC (UxC), another uranium market consultant. Comment of Cameco Corp., Attachment, UxC Special Report, “Impact of DOE Inventory Sales on the Nuclear Fuel Markets” (January 2015) (hereinafter “UxC Report”). A summary of UxC's estimates of the effect of DOE transfers on future prices appears in Table 4. UxC explains that it estimated the price effect of DOE transfers using two proprietary econometric models: The U-PRICE model and the SWU-PRICE model. UxC explains that these models were developed using historical data on the nuclear fuel markets collected and compiled by UxC. These two models take into account and quantify the impact of “key factors influencing the markets.” UxC also explains that the two models can be linked to simulate the interrelationship between uranium concentrates and enrichment. UxC Report, 3.19

    19 Additional information about the U-PRICE model can be found in Chapter 1 of UxC Uranium Market Outlook—Q4 2014, 7-21 (2014).

    Using these two models, UxC estimates the effects of DOE transfers using two slightly different methodologies. For the first approach, what UxC calls the “incremental approach,” UxC does not include the cumulative impact of previous years' transfers. The second approach, which UxC calls the “total impact approach,” includes sales from previous years. UxC argues that previous years' sales should be included because “such sales have a longer-term effect on market perceptions among both buyers and sellers. In particular, the increased supplies from DOE's sales and transfers removed market opportunities available to other uranium suppliers.” UxC Report, 5.

    Using its incremental approach, UxC estimates that between 2012 and 2014 DOE's transfer reduced the spot price by an average of $4.50 per pound and the term price by an average of $2.88 per pound. Using its total impact approach, UxC estimates that between 2008 and 2014 DOE's transfers reduced the spot price by an average of $7.11 per pound and the term price by an average of $5.10 per pound. UxC Report, 6-7.

    UxC also estimates the effect of DOE continued transfers at current rates for the period 2015 to 2030. UxC estimates that DOE transfers in the near and medium terms would reduce the spot price by an average of $5.78 per pound. UxC projects that this effect will change slightly in the medium term as market prices start to recover. Specifically, DOE transfers will reduce the spot price between 2018 and 2030 by an average of $4.47 per pound. UxC also notes that the former number is larger relative to the expected price of uranium than the latter number (14.1% versus 7.1%). UxC Report, 10. UxC estimates that DOE transfers in the near and medium terms would reduce the term price by an average of $4.86 per pound. Between 2018 and 2030, DOE transfers are estimated to reduce the term price by an average of $5.30 per pound. Again, the near and medium term impact is larger in relation to the expected price (9.0% versus 7.1%). UxC Report, 11.

    Table 4—UxC's Estimate of Effect of DOE Transfers on Uranium Concentrate Spot and Term Prices in $ per Pound U3O8 UxC Report Near- & mid- term price
  • effect
  • Percent of
  • expected price
  • Long-term price effect Percent of
  • expected price
  • Spot Price $5.78 14.1 $4.47 7.1 Term Price 4.86 9.0 5.30 7.1

    UxC puts particular focus on the interrelationship between the uranium and enrichment markets. UxC states that uranium and SWU are “substitutes.” Thus, UxC uses enrichment prices as an input into its uranium concentrate price forecast, and vice versa. UxC Report, 5, 8, 17. DOE understands that this interplay can take several forms. First, to the extent that enrichers have unsold enrichment capacity, they may apply that excess capacity to underfeeding 20 and/or re-enriching DUF6 tails.21 This essentially allows enrichers to produce additional natural uranium hexafluoride, which could then be sold on the open market. Second, if the price of enrichment decreases relative to the price of uranium concentrates, the optimum tails assay decreases, requiring customers to deliver less natural uranium feed to get the same amount of enriched uranium output.

    20 Enrichers can change the amount of natural uranium needed as input (“feed”) by applying a greater or lesser amount of enrichment work to a given amount of feed. “Underfeeding” refers to when enrichers ply a greater amount of enrichment work to an amount of feed, thus requiring less feed to achieve the same amount of enriched product.

    21 In addition to “underfeeding,” enrichers can apply additional enrichment work to existing depleted uranium from past enrichment processes by feeding them back into the enrichment process. This process is often called “re-enrichment” of tails.

    The other market analyses do not appear to take these interplays into account.22 But DOE believes the price interplay would be small, and the two effects may potentially offset. Since only some of DOE inventories contain an enrichment component, DOE materials can be expected to have a larger proportional effect on the uranium concentrates and conversion markets as compared to the enrichment market. At current rates, ERI estimates that DOE transfers in 2015 under Scenario 1 would represent 4%, 5%, and 2% of that year's global requirements for uranium, conversion, and enrichment, respectively. Since DOE inventories are a greater proportion of uranium and conversion requirements, it seems likely that the effect of DOE transfers would be to slightly increase the ratio of SWU price to UF6 price. This would increase the optimum tails assay, which may actually increase demand for uranium concentrates slightly. In addition, practices in the industry suggest that the enrichment component of DOE material does not displace primary production at existing facilities. Enrichers typically do not increase centrifuge capacity without long-term contracts in place to purchase the output. Comment of URENCO, Inc., at 2. Also, some in the market have chosen to allow older centrifuges to retire without being replaced instead of retaining excess capacity. 2015 ERI Report, 16; UxC Enrichment Market Outlook—Q4 2014, 11 (2014). Thus, it is far from clear that for every SWU contained within DOE material, a corresponding amount of primary production becomes excess capacity available for tails re-enrichment or underfeeding. Considering this information as a whole, it does not appear that the interrelationship between the enrichment and uranium markets will significantly affect how DOE's material affects uranium market prices.

    22 ERI's market clearing price analysis, for example, includes material from underfeeding as “Secondary Supply.” However, ERI does not consider how a change in uranium concentrate and/or conversion prices would affect the price of SWU or the level of underfeeding present in secondary supply.

    2. Realized Prices of Current Operators

    ERI states that realized price varies from one company to another. To estimate the realized prices for U.S. producers, ERI gathered information from public filings representing approximately 95% of U.S. production. 2015 ERI Report, 60-61. ERI does not list the specific dollar figures, but it provides a graph of how realized uranium prices have changed over time for several U.S. producers. This graph shows that realized prices declined for most primary producers in 2014. Even with this decline, ERI estimates that several producers achieved realized prices in 2014 well above the average spot price over the course of the year. At least one producer achieved a realized price well above the average term price for 2014. 2015 ERI Report, 61.

    ERI reports that some mining companies have negotiated contracts that base the price paid at least partially on a fixed or base-escalated pricing mechanism. As an example, ERI reports that Cameco has reported that the price sensitivity of its current contract portfolio is about 50% of any change in spot market price. ERI estimates that less than 30% of U.S. production currently comes from companies that are effectively unhedged against changes in spot price. 2015 ERI Report, 60-61.

    TradeTech also provides its estimates of the decline in realized price for several producers—both U.S. and foreign. Although TradeTech does not provide specific figures, it provides information on several firms in chart form. It appears from the chart that among the firms for which TradeTech provides estimates, realized prices in 2013 varied from as low as about $38 to as high as about $57. For most producers, there was a decline in realized price between 2011 and 2013. The magnitude of that decline ranges from approximately $12 to as low as $2 or $3. TradeTech Report, 13. TradeTech notes that one reason for declining realized prices is the expiration of long-term contracts signed when prices were substantially higher. TradeTech Report, 12.

    NAC similarly notes that some higher cost suppliers have locked in higher prices through fixed price contracts that allow them to realize prices greater than current market prices. NAC Report, 3-22. NAC also provides its estimated supply capability broken down by production cost. The specific figures are withheld from the public version of the NAC Report to protect confidential information. NAC Report, 3-9 to 3-11. Although NAC estimates the effect of DOE transfers on market price, as described above, NAC does not provide specific estimates of the effect on the price realized by individual producers.

    EIA reports several figures that are relevant to the prices realized by current production facility operators. EIA reports that the weighted average price in sales directly from U.S. producers in 2013 was $44.65. EIA, 2013 Uranium Production Report, 7 (2014). Similarly, EIA reports that the weighted average price paid by U.S. reactor operators in 2013 was $51.99 per pound U3O8 equivalent (per lb U3O8). EIA, 2013 Uranium Marketing Report, 4 (2014). EIA provides comparatively more information on the price paid by U.S. reactor operators. Although EIA does not provide a complete range of prices, it does report that the bottom 7.1 million pounds U3O8 equivalent (approximately 1/8th of uranium delivered in 2013) purchased by U.S. operators had a weighted average price of $34.34. The top 7.1 million pounds had a weighted average price of $72.62.23 EIA, 2013 Uranium Marketing Report, 26. EIA also provides average prices broken down by origin—foreign vs. U.S.—and by seller—U.S. producer, U.S. brokers and traders, other U.S. suppliers (i.e. other reactor operators, converters, enrichers, or fabricators), and foreign suppliers. The weighted average price in 2013 for U.S. origin uranium was $56.37 per lb U3O8. The weighted average price in 2013 from U.S. brokers and traders was $50.44. For 2013, EIA does not report the weighted average price of uranium purchased by U.S. reactor operators directly from U.S. producers to avoid disclosure of individual company data. However, in recent years when that value is reported, it has been above the average price paid for U.S. origin uranium. EIA, 2013 Uranium Marketing Report, 4 (2014). For comparison, DOE notes that the 2013 average spot price was around $39.00 and the average term price was around $54.00.24

    23 These two figures do not differentiate between U.S.-origin versus foreign material. However, EIA reports that the weighted average price of U.S. origin material is higher than the average for all foreign material. EIA, 2013 Uranium Marketing Report, 20 (2014).

    24 As calculated according to monthly price indicator data from UxC.

    EIA provides data about sales using different pricing mechanisms. EIA reports that of the approximately 23.3 million pounds U3O8 equivalent purchased by U.S. reactor operators from domestic sources 25 and delivered in 2013, 14.5 million pounds were purchased based on fixed or base-escalated pricing—approximately 62.3%—with a weighted-average price of $54.95. Approximately 3.6 million pounds were purchased based purely on spot-market pricing—approximately 15.6%—with a weighted-average price of $42.55. The remaining 5.1 million pounds—approximately 22%—was sold based on some other pricing mechanism with a weighted average price of $52.68. EIA, Uranium Marketing Report, 24 (2014).

    25 Note that EIA's figure includes purchases of U.S.-origin uranium as well as purchases from a firm located in the United States. Therefore, this number includes uranium from sources other than the domestic uranium industry. EIA reports that approximately 9.5 million pounds of U.S. origin uranium was delivered to U.S. reactor operators in 2013. EIA, Uranium Marketing Report, 20 (2014).

    3. Production at Existing Facilities

    ERI reports that U.S. production has risen since the DOE uranium inventory transfers in December 2009. In 2014, production was 5% higher compared to the previous year. However, ERI reports that production in 2015 is expected to decline to 2013 levels. 2015 ERI Report, 58. Since 2009, four new operations have begun production: Willow Creek in 2010, Hobson/Palangana in late 2010/early 2011, Lost Creek in 2013, and Nichols Ranch in 2014. ERI also reports that one additional production center is expected to begin operations in 2015. Despite these new operations, ERI notes that several conventional and in-situ leach operations have scaled back operations. 2015 ERI Report, 57.

    After reporting this information, ERI presents a chart showing the price levels at the time cutbacks were announced at various U.S. suppliers. ERI reports price points for four operations: $45 per pound in the spot market for conventional mines in Utah; $40 per pound in the spot market for two in-situ-leach operations; and $35 per pound in the spot market for additional conventional mines and a uranium mill. 2015 ERI Report, 62.

    ERI then estimates average production costs for existing mines by referring to EIA's published data on production expenditures across the uranium industry. Using a three year average to smooth out year-to-year differences, ERI notes that average production costs have remained fairly constant since 2009 at about $40 per pound. 2015 ERI Report, 63. ERI further reports that it estimates production costs at U.S. in-situ-leach facilities to range from the low $30s to the mid $40s per pound. ERI concludes that the pattern of cutbacks and estimated production costs “do not seem to indicate that adding back the $3 per pound price effect attributed to all DOE inventory material for Scenario 1 would move current prices enough to cause U.S. producers to ramp well field development and production activities back up.” 2015 ERI Report, 64. ERI further notes that the spot price would remain near $40 per pound and “may still not be sufficient for higher cost ISL producers to restart well field development or higher cost conventional mines to resume mining activities, and likely would not have prevented the decisions to cut back when prices declined to $35/lb in mid 2013 and then below $30/lb in mid 2014.” 2015 ERI Report, 64.

    The 2014 ERI Report came to similar conclusions using similar methodology. That report noted that despite the overall increase in uranium production in recent years, there have been production cuts at several operations. 2014 ERI Report, 49. ERI also provided a chart of production cut announcements and the then-current spot and term prices. 2014 ERI Report, 58. ERI noted that some uranium producers report costs in public filings, but these costs are not reported consistently across firms and generally do not include royalties and severance taxes or the cost of ongoing wellfield development at in-situ-leach operations. ERI's estimate of average industry-wide production costs is the same as in the 2015 ERI Report—i.e. approximately $40 per pound. 2014 ERI Report, 59.

    TradeTech predicts a “potential reduction in the number of market participants.” TradeTech Report, 21. It then applies the price effect it estimates for DOE transfers to a hypothetical uranium producer with a production cost of $47.41 per pound. See Figure 15 of TradeTech Report, 22. TradeTech does not apply its estimate to any particular producer. TradeTech does, however, provide estimates for the production costs of several firms in both 2011 and 2013.26 Although TradeTech does not provide specific cost data, it does provide information on several firms in chart form. It appears from the chart that among the firms TradeTech provides estimates for, production costs in 2013 varied from as low as $30 to as high as $50. TradeTech also notes that many producers have been able to reduce or stabilize costs in recent years. This is also reflected in the difference between the producers' costs in 2011 and in 2013. TradeTech Report, 13.

    26 This figure includes information on some projects that are not part of the domestic uranium mining industry, such as Uranium One's Kazakh projects.

    As noted above, NAC provides estimated production cost ranges for segments of current supply, but it does not directly estimate the effect of DOE transfers on production levels. NAC Report, 3-9 to 3-11.

    UxC does not provide any specific estimates of production levels or costs at currently operating facilities. However, in other reports, UxC outlines detailed estimates for individual mines. UxC Uranium Market Outlook—Q4 2014, 76-78 (2014); UxC Uranium Production Cost Study, 80-84 (Aug. 2013).

    In addition to the information described above, DOE has considered information from EIA reports. EIA reports on production in the domestic uranium industry on a quarterly and annual basis. EIA's most recent quarterly report provides preliminary data for 2014. U.S. primary production in 2014 stood at 4.9 million pounds U3O8. This is about 5% higher than in 2013 and 15% higher than in 2012. In fact, this represents the highest production total in any calendar year since 1997. EIA, Domestic Uranium Production Report Q4 2014, 2 (January 2015). The same number of uranium concentrate processing facilities—seven—operated in 2014 as in 2013. EIA reports that the White Mesa conventional mill halted production in the fourth quarter of 2014 and that the Nichols Ranch in-situ-leach plant began operation in the second quarter of 2014. EIA Domestic Uranium Production Report Q4 2014, 3-6 (January 2015).

    4. Employment Levels in the Industry

    DOE has considered information contained from EIA reports relating to employment in the domestic uranium production industry. EIA's most recent Uranium Production Report states that employment stood at 1,156 person-years in 2013, 1,196 person-years in 2012, and 1,191 person-years in 2011. EIA, 2013 Uranium Production Report, 10 (May 2014).

    In its analysis, ERI compared EIA's employment figures with changes in uranium spot and term prices. Based on a statistical correlation, ERI infers that employment responds to changes in price. 2015 ERI Report, 73. ERI then uses this correlation to estimate that the decrease in uranium prices over the course of 2014 resulted in a loss of 114 person-years from the 2013 value of 1,156. 2015 ERI Report, 55. ERI then estimates that the price effect it attributes to DOE transfers lowered employment by 41 person years in 2013, and 44 person years in 2014. 2015 ERI Report, 56. ERI further estimates that price effects due to DOE transfers at the levels described in Scenario 1 would result in an average employment loss of 42 person years over the next 10 years. For Scenario 2 and 3, ERI estimated that the average employment loss would be 39 and 21 person years, respectively. Again, it is important to note that this estimate is not a prediction that the uranium production industry under Scenario 1 would shed 42 jobs in 2015 and each subsequent year. Instead, this figure reflects ERI's estimate that total employment in the industry would be higher by an average of 42 person-years without DOE transfers compared to with DOE transfers.

    For the 2014 ERI Report, ERI conducted a similar analysis and came to broadly similar conclusions. It estimated an employment loss of 50 person-years for 2013, and an average loss of 44 person years over the course of 2014-2023. 2014 ERI Report, 48.

    Though no commenter provided specific numbers, several referred to decreases in employment in recent years caused by decreases in uranium prices. E.g., Comment of Mark S. Pelizza, at 1. Some commenters stated that the uranium production industry has lost half its workforce since May 2012 without providing supporting data. Comment of UPA, at 2; comment of Uranerz, at 2. Although several stated that DOE transfers were causing a portion of these losses, no commenter estimated the proportion of recent employment decreases attributable to DOE transfers. TradeTech Report, 21-22; UxC Report, 5.

    5. Changes in Capital Improvement Plans and Development of Future Facilities

    As stated above, ERI reports that four new production centers began operation since 2009: one in 2010, one in late 2010/early 2011, one in 2013, and one in 2014. In addition, one new production center—Peninsula's Lance—is expected to begin operations in 2015. 2015 ERI Report, 57. ERI explains that the new production centers may have been able to begin operations only because they were supported by fixed price term contracts that were signed when prices were substantially higher than they are currently—i.e. $55 to $70 per pound term price. At least one of these companies has directly stated that its project would not have been able to proceed at current price levels—$45 to $50 per pound term price. ERI also reports that some owners of proposed conventional mines outside the U.S. have stated that prices in the range of $60 to $70 per pound would be necessary for further development. 2015 ERI Report, 61.

    Based on the above, ERI concludes, “[i]t does not appear that removing the DOE inventory from the market and adding back the $2 to $3 per pound price effect attributed to the DOE inventory material . . . would necessarily increase current prices enough to change the situation regarding the viability of new production centers in the U.S.” 2015 ERI Report, 62. However, ERI reports that some lower cost ISL projects in the U.S. may be able to move forward at current prices. 2015 ERI Report, 62.

    The 2014 ERI Report came to similar conclusions. 2014 ERI Report, 57. It noted that despite the overall increase in uranium production in recent years, there have been production cuts at several operations. 2014 ERI Report, 49. ERI also reported the same prices that it believed would be required to motivate further development as it reports the 2015 report. 2014 ERI Report, 57.

    NAC provides estimates of the site forward cost including rate of return for ten properties it considers to be under development.27 The specific figures are withheld from the public version of the NAC Report to protect confidential information. NAC Report, 3-11 to 3-12. NAC does not directly apply its estimate of the price effect of DOE transfers to the production costs for these specific properties.

    27 NAC defines “under development” as a property for which ground breaking has begun. Note that NAC considers ten properties worldwide to be “under development”; they are not limited to U.S. properties. NAC Report, 3-11.

    EIA reports that production expenditures were $168.8 million in 2011, $187 million in 2012 and $168 million in 2013—when spread across annual production, these numbers represent approximately $41 per pound in 2011, $43 per pound in 2012 and $36 per pound in 2013. EIA, 2013 Domestic Uranium Production Report, 7, 11 (2014). Including costs related to drilling between 2009 and 2013 raises this figure by about $10-15 per pound, and including land, exploration, and reclamation costs in those years increases these figures by a further $19-24 per pound. EIA, 2013 Domestic Uranium Production Report, 7, 11 (2014).

    EIA also provides a table of different facilities and their operating statuses. EIA reports one uranium mill in development as of the 4th quarter 2014—in the “permitted and licensed” stage. EIA, Domestic Uranium Production Report Q4 2014, 4 (January 2015). EIA reports eight in-situ-leach plants under development—two in the “developing” stage, three that are “partially permitted and licensed,” two that are “permitted and licensed,” and one that is “under construction.” EIA, Domestic Uranium Production Report Q4 2014, 5-6 (January 2015).

    6. Long-Term Viability and Health of the Industry

    As described above, ERI notes that US industry production has risen since the start of DOE uranium inventory barters in December 2009. ERI also notes that four new operations began production since 2009, and one additional production center is expected to begin operations in 2015. 2015 ERI Report, 57.

    ERI also presents its future expectations regarding demand for uranium. ERI's most recent Reference Nuclear Power Growth forecasts project global requirements to grow to approximately 182 million pounds annually between 2018 and 2020, approximately 15% higher than current requirements. Global requirements are expected to continue to rise to a level of 203 million pounds in 2025, approximately 28% higher than current requirements. 2015 ERI Report, 6-7. ERI presents a graph comparing global requirements, demand, and supply from 2013—2035. That graph shows that global secondary supply and supply from current mines will continue to exceed global reactor demand until approximately 2018. However, if China's practice of purchasing amounts of uranium well in excess of its current reactor demand is included—what ERI terms “Discretionary Strategic” demand—global demand approximately equals supply from secondary supply and currently operating mines. 2015 ERI Report, 9-10. If planned expansions and new mines under development are included, supply is expected to exceed demand until approximately 2024, regardless of whether “Discretionary Strategic” demand is included.28 In the time period following 2025, ERI's graph shows demand significantly outstripping supply. 2015 ERI Report, 9. In order to meet this demand, ERI anticipates that mines it terms “planned” and “prospective” will need to begin operations. 2015 ERI Report, 11.

    28 ERI assumes that China's discretionary strategic inventory building will taper off by 2023. 2015 ERI Report, 10.

    A variety of other sources predict substantial increases in reactor requirements and/or demand.29 TradeTech reports reactor-only growth at 3.52% per year through 2024. Total uranium requirements growth is much slower during this period due to stock building purchases which taper downward.30 TradeTech Report, 34. The OECD and IAEA report that reactor requirements are expected to grow by at least 35.4 million pounds 31 by 2025—representing approximately 21% of 2015 requirements.32 OECD-IAEA, Uranium 2014: Resource, Production, and Demand, 105 (2014). In its Uranium Market Outlook for the 4th quarter of 2014, UxC similarly predicts significant increases in both requirements and demand in the long-term. UxC Uranium Market Outlook—Q4 2014, 56-60 (2014).

    29 DOE notes that uranium “demand” and reactor “requirements” are different. Requirements refers to an estimate of the amount of uranium needed to support operating reactors in a particular year. Demand includes additional purchased quantities for strategic or discretionary purposes. For example, in recent years China has purchased quantities of uranium far in excess of its reactor requirements. 2015 ERI Report, 10-11; TradeTech Report, 41-42; NAC Report, 3-2 to 3-5.

    30 TradeTech's charts appear to assume China's stock building purchases will cease to outpace Chinese requirements around 2023. TradeTech Report, 41-42.

    31 Converted from metric tons uranium in U3O8 (MTU) using a conversion rate of 2,599.79 pounds U3O8 per MTU.

    32 This represents OECD-IAEA's low growth scenario. The high growth scenario anticipates growth of almost 90 million pounds, approximately 50% above the high-growth scenario for 2015. Id.

    In addition to a predicted increase in demand, several sources predict a recovery in either spot or term uranium prices—or both. ERI notes that term prices are expected to increase in the future, but does not provide a specific forecast. 2015 ERI Report, 46. ERI's econometric model, however, does show an increase in the spot price. Specifically, ERI's chart forecasts that spot prices will recover over the course of 2015-2018 eventually settling in the $52-57 range after 2019. 2015 ERI Report, 52. TradeTech's forecasted Exchange Value predicts an increase in spot price to approximately $50 as early as June 2016, even with DOE transfers. TradeTech Report, 20. UxC's estimates of the effect of DOE transfers assume that market conditions will improve in the medium term. Specific price levels are withheld from Figures 5 and 6 of the public version to protect confidential information. UxC Report, 10-11. In its annual Uranium Market Outlook, UxC provides a more detailed explanation of its price forecast, which generally predicts an increase in price over the next 10 years. UxC Uranium Market Outlook—Q4 2014, 111-19 (2014).

    Finally, DOE recognizes that the predictability of transfers from its excess uranium inventory over time is important to the long-term viability and health of the uranium industries. ERI has noted the importance of predictability “for long-term planning and investment decisions by the domestic industry.” 2015 ERI Report, 100; 2014 ERI Report, 60-61. Some commenters also stated that DOE transfers should be predictable. Comment of UPA, at 2; comment of Cameco, at 2. DOE notes that the upper scenario considered by ERI would represent continued transfers at rates consistent with the May 2014 determination and roughly similar to the May 2012 determination. Compare 2015 ERI Report, 25, with 2014 ERI Report, 28.

    B. Uranium Conversion Industry 1. Market Prices

    In its analysis, ERI estimates the effect of DOE transfers on the market prices for conversion services. To estimate this effect, ERI employed a market clearing price model very similar to what is described above for the uranium market. As with uranium concentrates, ERI constructed individual supply and demand curves for conversion services and estimated the clearing price with and without DOE transfers. 2015 ERI Report, 44. A summary of ERI's estimates of the effect of DOE transfers on the conversion price appears in Table 5.

    Applying this approach to the three scenarios listed above, ERI estimates that DOE transfers at the rate of 2,705 MTU per year would cause the price of conversion services to be, on average, $0.90 lower between 2015 and 2024—with prices being $0.90 lower in 2015 and 2016 specifically. 2015 ERI Report, 45. For DOE transfers at a rate of 1,855 MTU per year, ERI estimates that prices would be, on average, $0.80 lower between 2015 and 2024—with prices being $0.70 and $0.60 lower in 2015 and 2016, respectively. If DOE ceased transfers under these two programs, ERI estimates that prices would be, on average, $0.40 lower between 2015 and 2024—with prices being $0.10 and $0.00 lower in 2015 and 2016, respectively.33 As with uranium concentrates, this is not a prediction that prices will drop by the specified amount once DOE begins transfers. According to ERI's analysis, a level of price suppression consistent with the estimate for Scenario 1 is already reflected in the current market price for conversion services. 2015 ERI Report, 44. If DOE continues transferring at Scenario 1 levels, the market prices would not change; if DOE began transferring at Scenario 2 levels, the market price would be expected to rise by approximately $0.20; if DOE ceased transfers under these programs, market prices would be expected to rise by $0.80. See Table 4.2 of 2015 ERI Report, 45.

    33 As noted above, the transfer rates for these scenarios refer only to the level of uranium transfers for cleanup at Portsmouth and downblending of LEU. The level of transfers for other DOE programs is the same in all three scenarios.

    ERI compares these numbers to the current spot and term price indicators published by TradeTech on January 31, 2015—i.e. $8.50 per kgU as UF6 on the spot market, and $16.00 per kgU as UF6 on the term market. As a percentage of the current prices, the average price effect attributable to DOE's transfers over the period 2015-2024 under Scenario 1 represents approximately 10.6% of the current spot price and 5.6% of the current term price. Under Scenario 2, the average price effect over the same period represents 9.9% of the spot price and 5.2% of the term price. Under Scenario 3, the average price effect represents 5.0% of the spot price and 2.7% of the term price. 2015 ERI Report, 47, 49.

    For the 2014 ERI Report, ERI conducted a similar market clearing approach for a level of transfers that is equal to Scenario 1 of the 2015 ERI Report. Although that report used slightly older data, the results are very similar. Notably, ERI estimated that the price effect attributable to DOE transfers at the current rates is $0.90 between 2014 and 2023—with prices being $0.90 lower in 2014, 2015, and 2016.34 2014 ERI Report, 40.

    34 ERI also compared those numbers to then current term and spot price indicators as of March 31, 2014. At that time, the TradeTech price indicator was $7.50 per kgU as UF6 on the spot market and $16.00 per kgU as UF6 on the term market. 2014 ERI Report, 23.

    Table 5—ERI's Estimate of Effect of DOE Transfers on Conversion Spot and Term Prices in  $  per  kgU  as  UF6 2015 ERI Report Estimated
  • price effect
  • (2015-2024)
  • 2014 ERI Report Estimated
  • price effect
  • (2014-2023)
  • Scenario 1 $0.90 $0.90 Scenario 2 0.80 Scenario 3 0.40

    In addition to its estimate of the price effect of DOE transfers on the uranium concentrate market, TradeTech estimates the effect on the price of conversion services. A summary of TradeTech's estimates appears in Table 6. It appears that TradeTech developed this estimate using its econometric Dynamic Pricing Model. TradeTech Report, 14. Using its model, TradeTech estimates that DOE's transfer reduced the spot price by an average of $2.13 per kgU as UF6 between January 2012 and December 2014. TradeTech Report, 17. TradeTech also estimates that continued DOE transfers at current rates would reduce the spot price by an average of $0.91 per kgU as UF6 between January 2015 and December 2016. TradeTech Report, 21.

    TradeTech also provides estimates for the effect of DOE transfers of several decreased transfer rates. If DOE transfers decreased to 75% of current levels, TradeTech estimates that the spot price would increase by an average of $0.21 per kgU as UF6 between January and 2015 and December 2016. TradeTech, 31.35 Based on TradeTech's estimate of the price suppression of DOE transfers at current levels, it appears that TradeTech is estimating that price suppression at 75% of current levels would be $0.70. If DOE transfers decreased to 50% of current levels, TradeTech estimates that the spot price would increase by an average of $0.43 per kgU as UF6 between January and 2015 and December 2016. TradeTech, 30. This corresponds to a price suppression of $0.48. If DOE transfers decreased to 25% of current levels, TradeTech estimates that the spot price would increase by an average of $0.66 per kgU as UF6 between January and 2015 and December 2016. TradeTech, 29. This corresponds to a price suppression of $0.25.

    35 Figures 21-24 of the TradeTech Report show TradeTech's estimates for the price impact at a range of different transfer rates. Although these charts and the related text refer to “Transfers at [25, 50, or 75] Percent of Established 2014 Volumes,” it appears that these charts actually reflect an estimate for a 25%, 50%, or 75% decrease relative to current levels, rather than transfers at the specified percentage of current levels.

    Table 6—TradeTech's Estimate of Effect of DOE Transfers on Conversion Spot Price in $ per kgU as UF6 TradeTech report Transfer rate
  • (compared to current)
  • Estimated price effect
  • (2015-2016)
  • 100% $0.91 75% 0.70 50% 0.48 25% 0.25

    UxC's U-PRICE and SWU-PRICE econometric models predict the markets' reaction to changes in supply for the uranium concentrate and enrichment industries. UxC does not directly model the conversion services market. Instead, UxC relies on other evidence to conclude that the price effect of DOE transfers on spot conversion prices have been “at least equal to, if not greater than, the impact on spot uranium prices.” Specifically, UxC notes that much of the world's spot conversion is sold in conjunction with uranium through contracts for UF6. UxC also notes that over the past few years the UF6 price has fallen as much as the U3O8 price has on a percentage basis. Finally, UxC notes that the Ux North American UF6 Price has been below the Ux NA UF6 value (i.e. the sum of spot uranium and spot conversion prices for a given quantity of UF6) over most of the period of DOE transfers. UxC Report, 15. With respect to the future effect of DOE transfers, UxC expects that DOE transfers will continue to have a similar effect on spot conversion prices and a somewhat less but still “noticeable” effect on term conversion prices. UxC Report, 16.

    2. Realized Prices of Current Operators

    ERI does not provide in either report a specific estimate of the change in ConverDyn's realized price due to DOE transfers. However, ERI does note that ConverDyn's realized price is believed to have increased over the past decade, although ERI says unit costs have increased as well. ERI bases its sales revenue assumptions on a sale price of $14 per kgU. This estimate appears to be based predominately on claims by the company that it is operating at a loss. 2015 ERI Report, 70; 2014 ERI Report, 70.36

    36 It appears that ERI developed this assumption based on its estimate of ConverDyn's production costs of $15 per kgU. Since ConverDyn claims to be operating at a loss, ERI assumes that its realized price must be lower. 2015 ERI Report, 70.

    No commenter provides specific information about the current realized prices achieved in the conversion industry, and no commenter directly estimates the effect of DOE's transfers on realized prices. However, some information relevant to ConverDyn's realized price is publicly available.

    ConverDyn has stated in the past that the conversion market generally relies on long-term contracts. Declaration of Malcolm Critchley, Converdyn v. Moniz, Case no. 1:14-cv-01012-RBW, Document 7-3, at ¶ 37 (June 23, 2014); see also UxC Conversion Market Outlook—December 2014, 27-28, 32 (2014). Traxys has stated that ConverDyn specifically sells conversion services “almost exclusively” on long-term contracts. Declaration of Kevin P. Smith, ConverDyn v. Moniz, Case no. 1:14-cv-01012-RBW, Document 17-7, at ¶ 16 (July 7, 2014). Traxys has also stated that ConverDyn exercises significant pricing power in the market. Traxys refers to a 2011 letter from ConverDyn to its customers notifying them that it would not sell conversion services for less than $16.50 per kgU. Id. Since then, the term price indicator for conversion services has remained remarkably stable, even as spot prices for conversion have fluctuated. 2015 ERI Report, 12.

    DOE does not have complete information regarding the pricing structure of conversion services contracts. ConverDyn has stated in the past that the conversion market generally relies on long-term contracts that are “linked, at least in part, to market prices at the time of the contract.” Declaration of Malcolm Critchley, Converdyn v. Moniz, Case no. 1:14-cv-01012-RBW, Document 7-3, at ¶ 37 (June 23, 2014). Although it is common practice for long-term contracts for U3O8 to include a non-fixed element that depends on market prices at the time of delivery, it is unclear to what extent this practice is prevalent in the conversion industry.

    In addition to the above, ConverDyn's comment also refers to a document it submitted to DOE in March 2014 that provides some additional information on ConverDyn's contracting practices. Comment of ConverDyn, Enclosure, at 5 n.12. That document was submitted with a request that it be treated as containing proprietary information. Letter from Malcolm Critchley, ConverDyn, to Peter B. Lyons, DOE (March 10, 2014). DOE may consider this document in its deliberations.

    3. Production at Existing Facilities

    There is only one existing conversion facility in the United States, the Metropolis Works facility (MTW) operated by Honeywell International. ConverDyn is the exclusive marketing agent for conversion services from this facility. Comment of ConverDyn, at 1; 2015 ERI Report, 64. The nominal capacity of the Metropolis Works facility is 15 million kgU as UF6. However, the facility generally operates below that level. 2015 ERI Report, 65. Based on statements from ConverDyn, ERI estimates that production at this facility was approximately 11 million kgU as UF6 per year prior to the loss of sales associated with Fukushima. Because ConverDyn has stated that this volume loss was approximately 25%, ERI estimates current sales volume at 8.25 million kgU as UF6. 2015 ERI Report, 65.

    In estimating the effect of DOE transfers on ConverDyn's sales volume, ERI assumes that 50% of the material used for cleanup at Portsmouth and 100% of all other DOE material enters the U.S. market. 2015 ERI Report, 65-66. Based on statements from ConverDyn, ERI assumes that ConverDyn's share of the U.S. market for conversion services is 25% and that its share of the international market is 16%. 2015 ERI Report, 68. A summary of ERI's estimates of the effect of DOE transfers on ConverDyn's sales volume appears in Table 7. Using the assumptions described above, ERI estimates that under Scenario 1, DOE transfers decrease ConverDyn's market volume by 0.67 million kgU, or 7.5%. Under Scenario 2, ERI estimates that DOE transfers decrease ConverDyn's market volume by 0.46 million kgU, or 5.3%. Under Scenario 3, ERI estimates that DOE transfers decrease ConverDyn's market volume by 0.08 million kgU, or 1%. 2015 ERI Report, 69-70. As with ERI's price estimates discussed above, these estimates do not suggest that were DOE to transfer uranium in accordance with Scenario 1, ConverDyn would lose the predicted volume of sales. DOE has been transferring at or above the rate of Scenario 1 for nearly three years. On ERI's analysis, the estimated effect has already occurred. Transfers in accordance with Scenario 1 would continue the effect, and transfers in accordance with Scenario 2 or 3 would lead to an increase in ConverDyn's sales volume, of the amount ERI predicts.

    Table 7—ERI's Estimate of Decrease in ConverDyn's Sales Volume Volume
  • (million kgU)
  • Percent change
    Scenario 1 0.67 7.5 Scenario 2 0.46 5.3 Scenario 3 0.08 1

    Based on its estimate of the effect on ConverDyn's sales volume, ERI also estimates the change in production costs at Metropolis Works due to DOE transfers. A summary of ERI's estimates of the effect of DOE transfers on ConverDyn's production costs appears in Table 8. ERI analyzes two scenarios based on slightly different assumptions about the amount of ConverDyn's costs that are variable. Specifically, ERI calculates production costs based on 80% and 100% fixed costs. 2015 ERI Report, 70.

    ERI assumes that ConverDyn's production cost would be $15 per kgU if DOE material was not being introduced into the market. Assuming 100% of Metropolis Works' costs are fixed, DOE transfers would not affect total production costs, but they would increase per unit costs. Specifically, ERI estimates that DOE transfers at the level under Scenario 1 increase production costs to $16.2 per kgU, about 8% higher than without DOE transfers. Transfers at the level under Scenario 2 would cause Metropolis Works production costs to be $15.84, about 5.6% higher than without DOE transfers. Under Scenario 3, production costs would be $15.15, about 1% higher than without DOE transfers. 2015 ERI Report, 70. If 80% of Metropolis Works' costs are fixed, total production costs would be lower with DOE transfers, but per unit production costs would also be lower. Under Scenario 1, production costs would be $15.97, about 6.5% higher than without DOE transfers. Under Scenario 2, production costs would be $15.68, about 4.5% higher than without DOE transfers. Under Scenario 3, production costs would be $15.12, about 1% higher than without DOE transfers. 2015 ERI Report, 71.

    Table 8—ERI's Estimate of Increase in ConverDyn's Production Cost 80% fixed Cost
  • (per kgU)
  • Percent change 100% fixed Cost
  • (per kgU)
  • Percent change
    Scenario 1 $15.97 6.5 $16.20 8 Scenario 2 15.68 4.5 15.84 5.6 Scenario 3 15.12 1 15.15 1

    The 2014 ERI Report conducted a similar analysis using slightly different assumptions regarding ConverDyn's pre-Fukushima production and current market share. Specifically, ERI calculated the effect of DOE transfers assuming two different pre-Fukushima production levels: 10 million kgU and 12 million kgU. With these assumptions, ERI estimated ConverDyn's current sales volume at 7.50 million kgU and 9.00 million kgU respectively. 2014 ERI Report, 66, 68. ERI also calculated the effect of DOE transfers assuming two different assumptions about ConverDyn's share of the U.S. Market: 25% and 30%. 2014 ERI Report, 65-66. Based on these assumptions ERI estimates that DOE transfers decrease ConverDyn's market volume by between 0.60 and 0.72 million kgU. 2014 ERI Report, 66, 68. This represents between 6.9% and 8.1% of ConverDyn's estimated sales volume. 2014 ERI Report, 67, 69.

    On production cost, ERI similarly estimates based on 80% and 100% fixed costs. As with sales volume, ERI conducts this calculation twice: once assuming a volume of 7.50 million kgU, and once assuming a volume of 9.00 million kgU. For the 7.50 million kgU scenario, ERI estimates that if production costs are 100% fixed, DOE transfers cause unit production costs to increase about 8% to $16.20 per kgU. If production costs are 80% fixed, DOE transfers cause unit production costs to increase about 6.4% to $15.96 per kgU. For the 9.00 million kgU scenario, ERI estimates that production costs would increase by 7.8% for 100% fixed costs and 6.2% for 80% fixed costs. 2014 ERI Report, 70-71.

    ConverDyn's comment in response to the RFI does not provide a separate estimate of the effect of DOE transfers on its sales volume. ConverDyn refers to the relevant sections of the 2014 ERI report regarding its sales volume and production costs. Comment of ConverDyn, Enclosure, at 5. With respect to the 2014 ERI Report, ConverDyn does not refute or confirm the assumptions ERI used in its analysis regarding ConverDyn's sales volume, market share, or production costs. ConverDyn's comment also refers to a document it submitted to DOE in March 2014. Comment of ConverDyn, Enclosure, at 5 n.12. That document was submitted with a request that it be treated as containing proprietary information. Letter from Malcolm Critchley, ConverDyn, to Peter B. Lyons, DOE (March 10, 2014). That document provides estimates of the effect of DOE transfers on ConverDyn's sales volume and profits, but it does not provide financial information demonstrating that those effects have occurred or supporting analysis explaining why a given change in ConverDyn's sales or revenue should be attributed to DOE transfers. Id. DOE may consider this document in its deliberations.

    In addition to the above, ConverDyn notes in its comment that the Metropolis Works facility ceased production beginning in January 2015 for a period of approximately three months—two months longer than usual. ConverDyn states that this was necessitated by “the continued depressed state of the conversion market.” Although ConverDyn refers to the displacement of conversion sales by DOE's transfers, it acknowledges that DOE's transfers are not the sole cause of the lengthening of Metropolis Works facility's annual shutdown. ConverDyn does not include supporting data or otherwise provide a proportionate breakdown of the impact of DOE material versus other factors in causing this shutdown. Comment of ConverDyn, Enclosure, at 4.

    The UxC Report does not provide estimates for production levels or production costs at individual facilities, but its report does note that the cost for primary producers is “known to be in the range of $10-$15/kgU.” UxC Report, 15. In a separate publication, UxC provides more detailed estimates of both current production levels and projected future production for individual facilities. Market share can be determined by comparing production levels to those of other primary producers and secondary sources. UxC Conversion Market Outlook—December 2014, 45-47 (2014).

    Traxys provides some information relevant to DOE's analysis of the assumptions ERI uses in its calculations. Traxys explains that in selling material obtained from Fluor-B&W Portsmouth, it pursues a goal to sell at least 50% of the material to non-U.S. customers. Traxys states that it has consistently met this goal. Comment of Traxys, at 1. Traxys further explains that in 2014 no more than 40% of DOE-derived material was sold in the U.S. market. Comment of Traxys, at 2. This is similar to the amount of conversion that Traxys has separately stated went to the U.S. market in prior years. Traxys stated in July 2014 that 42% of DOE-derived conversion entered the U.S. marketplace during calendar year 2013. Declaration of Kevin P. Smith, ConverDyn v. Moniz, Case no. 1:14-cv-01012-RBW, Document 17-7 at ¶11 (July 7, 2014).

    4. Employment Levels in the Industry

    ERI notes that Metropolis Works restarted after an extended shutdown in summer 2013 with approximately 270 employees. Prior to the 2012-2013 shutdown, ERI estimates that the facility employed approximately 334 people. As this change coincided with a change in long-term production volume, ERI concludes that is unlikely that 100% of Metropolis Works' production costs are fixed. 2015 ERI Report, 72-73; 2014 ERI Report, 71. Although it does not provide specific estimates, ERI states that “[a] portion of the reduction in work force at Metropolis Works may be associated with the introduction of DOE inventory into the market.” However, ERI also notes that several other factors likely played a part as well. 2015 ERI Report, 73; 2014 ERI Report, 72. ConverDyn does not provide a separate estimate of decreased employment levels due to DOE transfers; instead ConverDyn referred to the relevant sections of the 2014 ERI Report. Comment of ConverDyn, Enclosure, at 5.

    5. Changes in Capital Improvement Plans and Development of Future Facilities

    Neither ERI nor any of the commenters provide an estimate of the effect of DOE transfers on new facility development or capital improvement plans. However, DOE understands that several conversion services companies are undertaking these or related activities.

    Although there are several large-scale development projects currently planned or underway outside the United States—namely AREVA's COMURHEX II modernization project and TVEL's plan for a new facility at SCC—DOE is not aware of any such plans in the United States. See Eileen Supko & Thomas Meade, “New facilities are on the horizon,” Nuclear Engineering International (Oct. 6, 2014), available at http://www.neimagazine.com/features/featurenew-facilities-are-on-the-horizon-4394892; UxC Conversion Market Outlook—December 2014, 50, 56-57, 73 (2014).

    Metropolis Works has, however, undertaken substantial capital expenditures at its existing facility in recent years. Honeywell has stated that it has invested “nearly $177 million over the past 10 years in capital improvements, including $50 million in safety projects.” “About Us,” Honeywell, http://www.honeywell-metropolisworks.com/about-us.37 Some of these upgrades came during an extended shutdown in 2012 and 2013, in which Metropolis Works made upgrades to ensure the facility could withstand extreme natural disasters. These changes were made under an agreement with NRC in response to an inspection NRC conducted in the wake of the Fukushima disaster in Japan. “Honeywell and U.S. Nuclear Regulatory Commission Reach Agreement on Necessary Upgrades to Metropolis Nuclear Conversion Facility,” News Release (Oct. 16, 2012), available at http://www.honeywell-metropolisworks.com/?document=oct-16-2012-press-release-honeywell-and-u-s-nuclear-regulatory-commission-reach-agreement-on-necessary-upgrades-to-metropolis-nuclear-conversion-facility&download=1.

    37 Letters from Honeywell management include similar numbers. A November 20, 2014, letter included identical figures. Jim Pritchett, Honeywell Metropolis Works, Letter to Employees (Nov. 20, 2014), available at http://www.honeywell-metropolisworks.com/?document=letter-to-employees-23&download=1. Older letters provided slightly different figures. Jim Pritchett, Honeywell Metropolis Works, Letter to Community (Dec. 19, 2013), available at http://www.honeywell-metropolisworks.com/?document=letter-to-the-community-from-new-metropolis-works-plant-manager&download=1.

    In terms of future plans, Metropolis Works announced in November 2014 that it would be shutting down for approximately 90 days beginning in early January 2015. Honeywell noted that it would use the extended shutdown to make updates and capital improvements. Jim Pritchett, Honeywell Metropolis Works, Letter to Employees (Nov. 20, 2014), available at http://www.honeywell-metropolisworks.com/?document=letter-to-employees-23&download=1; see also Comment of ConverDyn, Enclosure, at 4. Honeywell has further stated that the company plans to spend $17.5 million in improvements during 2015. Jim Pritchett, Honeywell Metropolis Works, Letter to Employees (Jan. 30, 2014), available at http://www.honeywell-metropolisworks.com/?document=letter-to-employees-24&download=1.

    6. Long-Term Viability and Health of the Industry

    ERI's most recent Reference Nuclear Power Growth forecasts project global requirements to grow to approximately 67.2 million kgU by 2020, approximately 20% higher than current requirements. Global requirements are expected to continue to rise to a level of 91.4 million kgU by 2035, approximately 63% higher than current requirements. 2015 ERI Report, 13. ERI presents a graph comparing global requirements, demand, and supply from 2013—2035. That graph forecasts that global secondary supply and supply from primary converters will continue to exceed global demand until at least 2025. Beyond that point, supply generally keeps pace with growth in requirements. 2015 ERI Report, 14.

    Although not focused on conversion, the requirements forecasts noted above in section III.A.6 are also relevant to the conversion industry. In general, requirements and/or uranium concentrate demand forecasts should also apply to demand for conversion services. However, there may be some small differences due to strategic and discretionary inventory building. For example, China has been purchasing strategic supply well in excess of its requirements. Those purchases have come in the form of U3O8. 2015 ERI Report, 13. Thus, these purchases affect near-term uranium concentrate demand, but do not affect near-term conversion demand.

    No other commenter provided specific projections about future conversion requirements, demand, or prices. However, DOE has some additional information not submitted in response to the RFI. In its December 2014 Conversion Market Outlook, UxC predicts significant increases in both requirements and demand in the long-term. UxC Conversion Market Outlook—December 2014, 40, 44 (2014). UxC also provides a more detailed explanation of its price forecast, which generally predicts an increase in price over the next 10 years. UxC Conversion Market Outlook—December 2014, 82, 85 (2014).

    Finally, as with uranium concentrates, DOE recognizes that the predictability of transfers from its excess uranium inventory over time is important to the long-term viability and health of the uranium conversion industry. Again, DOE notes that the upper scenario considered by ERI would represent continued transfers at rates consistent with the May 2012 and May 2014 determinations. Compare 2015 ERI Report, 25, with 2014 ERI Report, 28.

    C. Enrichment Industry 1. Market Prices

    In its analysis, ERI also estimated the effect of DOE transfers on the market prices for enrichment services. To estimate this effect, ERI employed a market clearing price model similar to what is described above for the uranium market. As with uranium concentrates and conversion, ERI constructed individual supply and demand curves for enrichment services and estimated the clearing price with and without DOE transfers. 2015 ERI Report, 44. A summary of ERI's estimates of the effect of DOE transfers on the market price for SWU appears in Table 9.

    Applying this approach to the three scenarios listed above, ERI estimates that DOE transfers at the rate of 2,705 MTU per year would cause the price of enrichment services to be, on average, $4.50 lower between 2015 and 2024—with prices being $5.90 and $3.80 lower in 2015 and 2016 specifically. 2015 ERI Report, 46. For DOE transfers at a rate of 1,855 MTU per year, ERI estimates that prices would be, on average, $3.60 lower between 2015 and 2024—with prices being $5.10 and $3.00 lower in 2015 and 2016 specifically. If DOE ceased transfers under these two programs, ERI estimates that prices would be, on average, $1.70 lower between 2015 and 2024—with prices being $3.20 and $1.70 lower in 2015 and 2016 specifically.38 As with uranium concentrates, this is not a prediction that prices will drop by the specified amount once DOE begins transfers pursuant to a new determination. According to ERI's analysis, a level of price suppression consistent with the estimate for Scenario 1 is already reflected in the current market price for conversion services. If DOE continued transferring at Scenario 1 levels, the market prices would not change; if DOE began transferring at Scenario 2 levels, the market price would be expected to rise by approximately $0.80; if DOE ceased transfers under these programs, market prices would be expected to rise by $2.70. See Table 4.3 of 2015 ERI Report, 46.

    38 As noted above, the transfer rates for these scenarios refer only to the level of uranium transfers for cleanup at Portsmouth and downblending of LEU. The level of transfers for other DOE programs is the same in all three scenarios.

    ERI compares these numbers to the current spot and term price indicators published by TradeTech on January 31, 2015—i.e. $88.00 per SWU on the spot market, and $90.00 per SWU on the term market. As a percentage of the current prices, the average price effect attributable to DOE's transfers over the period 2015-2024 under Scenario 1 represents approximately 5.1% of the current spot price and 5.0% of the current term price. Under Scenario 2, the average price effect over the same period represents 4.1% of the spot price and 4.0% of the term price. Under Scenario 3, the average price effect represents 1.9% of the spot price and 1.9% of the term price. 2015 ERI Report, 48, 50.

    For the 2014 ERI Report, ERI conducted a similar market clearing approach for a level of transfers that is equal to Scenario 1 of the 2015 ERI Report. Although that report used slightly older data, the results are similar. Notably, ERI estimated that the price effect attributable to DOE transfers at the current rates is $4.00 between 2014 and 2023—with prices being $5.20, $5.70, and $3.60 lower in 2014, 2015, and 2016, respectively.39 2014 ERI Report, 40.

    39 ERI also compared those numbers to then current term and spot price indicators as of March 31, 2014. At that time, the TradeTech price indicator was $96.00 per SWU on the spot market and $99.00 per SWU on the term market. 2014 ERI Report, 23.

    Table 9—ERI's Estimate of Effect of DOE Transfers on Enrichment Spot and Term Prices in $ per SWU 2015 ERI Report Estimated
  • price effect
  • (2015-2024)
  • 2014 ERI Report Estimated
  • price effect
  • (2014-2023)
  • Scenario 1 $4.50 $4.00 Scenario 2 3.60 Scenario 3 1.70

    In addition to its estimate of the price effect of DOE transfers on the uranium concentrate market, UxC estimates the effect on the price of enrichment services using its proprietary U-PRICFE and SWU-PRICE models. UxC Report, 5. As with its uranium concentrate estimates, UxC estimates the impact using two different methodologies, an “incremental approach” and a “total impact approach.”

    Using its incremental approach, UxC estimates that between 2012 and 2014 DOE's transfers reduced the spot price by an average of $7.49 per SWU and the term price by an average of $5.37 per SWU. Using its total impact approach, UxC estimates that between 2008 and 2014 DOE's transfers reduced the spot price by an average of $9.19 per SWU and the term price by an average of $6.96 per SWU. UxC Report, 8-9.

    UxC also estimates the effect of DOE continued transfers at current rates for the period 2015 to 2030. A summary of UxC's estimates of the effect of DOE transfers on future enrichment prices appears in Table 10. UxC estimates that DOE transfers in the near and medium terms would reduce the spot price by an average of $5.31 per SWU. UxC projects that this effect will change slightly in the medium term as market prices start to recover. Specifically, DOE transfers will reduce the spot price between 2018 and 2030 by an average of $4.86 per SWU. UxC also notes that the former number is larger relative to the expected price of enrichment than the latter number (5.9% versus 3.8%). UxC Report, 12. UxC estimates that DOE transfers in the near and medium terms would reduce the term price by an average of $5.50 per SWU. Between 2018 and 2030, DOE transfers are estimated to reduce the term price by an average of $5.00 per SWU. Again, the near and medium term impact is larger in relation to the expected price (5.6% versus 3.6%). UxC Report, 11.

    Table 10—UxC's Estimate of Effect of DOE Transfers on Enrichment Spot and Term Prices in $ per SWU UxC Report Near- & mid-term
  • price effect
  • Long-term
  • price effect
  • Spot Price $5.31 $4.86 Term Price 5.50 5.00

    As mentioned above, a change in market prices for uranium concentrates and conversion services may also affect enrichers. URENCO has stated that at a small amount of its capacity is devoted to underfeeding. Comment of URENCO, at 3. ERI notes that URENCO estimates it is using 10-15% of its capacity for underfeeding. 2015 ERI Report, 75. Thus, to the extent that URENCO utilizes or resells the natural uranium hexafluoride that results from underfeeding, the market prices for uranium and conversion could be relevant to its business decisions.

    2. Realized Prices of Current Operators

    There is only one currently operating enrichment facility in the United States, the URENCO USA (UUSA) gas centrifuge facility in New Mexico. No commenter provides information about the realized price achieved by URENCO or the effect of DOE transfers on that price. However, other sources provide some relevant information.

    In recent years, the vast majority of SWU has been sold on the term market. UxC Enrichment Market Outlook—Q4 2014, 17, 20 (2014). ERI estimates that more than 95% of enrichment requirements are covered under long-term contracts. 2015 ERI Report, 74. Even in the term market, contracting volume is down compared to levels prior to 2010. UxC Enrichment Market Outlook—Q4 2014, 9, 21 (2014). Long-term contracts for SWU last for 10 or more years, in some cases and in some cases 15 or more years. UxC Enrichment Market Outlook—Q4 2014, 100 (2014).

    EIA reports that in 2013, the average price paid for SWU was $142.22. EIA, Uranium Marketing Report, 7 (2014). This is well above the average market prices for 2013, approximately $110 in the spot market and $120 in the term market according to UxC.

    URENCO's most recent financial statements indicate that at least a portion of its contract portfolio “extend beyond 2025.” URENCO Limited, Interim Financial Statements for the 6 Months Ended 30 June 2014, at 6, available at http://www.urenco.com/_/uploads/content-files/Urenco_Group_Interim_Accounts_to_30_June_2014-final-02092014.pdf.40 URENCO has also stated that its enrichment contracts are usually fixed base price with escalation leaving URENCO with “no direct exposure to uranium prices.” URENCO Investor Update, 4 (Sept. 9, 2014), available at http://www.urenco.com/_/uploads/results-and-presentations/URENCO_Bond_Investor_Presentation_2014.pdf. Given the above considerations, it seems likely that URENCO's realized price based on its current contract portfolio is as much as 50% higher than the current spot and market prices. Since many of URENCO's contracts appear to have been entered before DOE began transfers comparable to the current levels, it is unlikely that continued DOE transfers will have an impact on the realized price achieved for enrichment services from existing capacity at UUSA during the period contemplated for the planned determination.

    40 DOE notes that URENCO's financial statements have referred to its order book as “extending up to and beyond 2025” at least since 2010. See URENCO, Annual Report & Accounts 2010, at 3 (2010), available at http://media.urenco.com/corp-website/298/annualreportandaccounts2010_1.pdf.

    As noted above, URENCO has stated that a small amount of its capacity is devoted to underfeeding. Comment of URENCO, at 3.41 ERI notes that URENCO estimates it is using 10-15% of its capacity for underfeeding. 2015 ERI Report, 75. To the extent that URENCO sells the natural uranium hexafluoride yielded from underfeeding, DOE transfers could affect its revenues to the extent the transfers cause decreases in the prices for uranium concentrates and conversion services.

    41 On May 22, 2014, URENCO submitted an application to the U.S. NRC to amend its license for the facility to allow it to use high assay tails (approximately 0.4% U235) as feed material. See 79 FR 43099 (July 24, 2014); “Redacted—Supplement to License Amendment Request for Capacity Expansion of URENCO USA Facility (LAR-12-10),” Letter from URENCO to U.S. NRC, LES-14-00071-NRC (June 17, 2014).

    3. Production at Existing Facilities

    URENCO reports that the nameplate capacity for the UUSA facility is 3.7 million SWU. Comment of URENCO, at 1. URENCO has also stated that construction of additional centrifuges will continue until the facility reaches 5.7 million SWU. “About Us, URENCO USA,” URENCO, http://www.urenco.com/about-us/company-structure/urenco-usa (accessed Feb. 21 2015).

    Due to the nature of gas centrifuges, it is highly unlikely that UUSA will decrease production of SWU. As URENCO states, due to the low level of electricity required to run the centrifuges, slowing production would have almost no effect on operating expenses. Furthermore, stopping and restarting a centrifuge may damage the equipment. Comment of URENCO, at 3.

    4. Employment Levels in the Industry

    ERI does not provide an estimate of the change in employment due to DOE transfers in the enrichment industry. No commenter references changes in employment in the enrichment industry. URENCO states that its business is essentially fixed-cost and makes no reference to changes in employment.

    5. Changes in Capital Improvement Plans and Development of Future Facilities

    URENCO recently completed “Phase II” of its expansion plans, bringing the capacity of its facility to 3.7 million SWU. “Phase II Completion,” URENCO (Apr. 9, 2014), http://www.urenco.com/news/detail/phase-ii-completion (accessed Feb. 22, 2014). URENCO is continuing to move forward with “Phase III” expansion, which will bring plant capacity to approximately 5.7 million SWU. URENCO notes that it has slowed its plan for construction of additional capacity. Comment of URENCO, at 3. URENCO expects to reach 5.7 million SWU capacity by 2023. URENCO Investor Update, 31 (Sept. 9, 2014). Although the company has requested a license amendment that would allow it to expand capacity to 10 million SWU per year, URENCO states that this move is “to provide for future licensing flexibility should the market recover.” URENCO notes that it cancelled construction of “Phase IV” in 2013. Comment of URENCO, at 3.

    DOE is aware of several other planned or proposed enrichment facilities in the U.S., namely, AREVA's Eagle Rock Enrichment Facility in Idaho, Centrus Energy's—formerly USEC Inc.—American Centrifuge Plant in Piketon, OH, and Global Laser Enrichment's facility in Wilmington, NC.42 Development of each of these facilities has been put on hold or slowed until market prices improve.

    42 Although not the subject of this determination, DOE notes that ERI analyzed the possible future transfer to GLE of high-assay depleted uranium. 2015 ERI Report, 27-28. As this transaction would involve reenrichment of depleted tails, it would tend to support additional demand for enrichment services.

    The Eagle Rock Enrichment Facility would use gas centrifuge technology and would have a capacity of approximately 3.3 million SWU. “Eagle Rock Enrichment Facility,” AREVA, http://us.areva.com/EN/home-203/eagle-rock-enrichment-facility.html (accessed Feb. 21, 2015). After announcing several delays in construction, AREVA stated in May 2013 that it was no longer projecting a start date for building the facility. “French company won't set date for Idaho nuclear facility,” The Oregonian (May 23, 2013), http://www.oregonlive.com/pacific-northwest-news/index.ssf/2013/05/french_company_wont_set_date_f.html (accessed Feb. 21, 2015). At the time of this announcement, the term market price for SWU was approximately $130, according to UxC's monthly price indicator.

    The proposed American Centrifuge Plant would use gas centrifuge technology and would have a capacity of approximately 3.8 million SWU. “USEC Inc. Gas Centrifuge,” U.S. NRC, http://www.nrc.gov/materials/fuel-cycle-fac/usecfacility.html (accessed Feb. 22, 2015). Active construction of new centrifuges has ceased. In a November 2013 quarterly filing with the SEC, Centrus Energy, then known as USEC, stated, “[a]t current market prices USEC does not believe that its plans for American Centrifuge commercialization are economically viable without additional government support.” USEC Form 10-Q, Securities and Exchange Commission, at 10 (Nov. 5, 2013) https://www.sec.gov/Archives/edgar/data/1065059/000106505913000049/usu-2013930x10q.htm (accessed Feb. 22, 2015). When this form was submitted to the SEC, the term market price for SWU was approximately $115, according to UxC's monthly price indicator.

    Global Laser Enrichment, a venture of GE-Hitachi and Cameco, has proposed an enrichment plant that would use laser enrichment technology developed by Silex Systems, an Australian company. The proposed facility in Wilmington, NC would have a capacity of about 6 million SWU. GLE License Application, Rev. 7, U.S. NRC, Docket 70-7016, at 1-16 (August 20, 2012), available at http://pbadupws.nrc.gov/docs/ML1224/ML12242A227.pdf. In July 2014, GLE announced that it would slow continued development of the facility “in line with current and future market realities.” “Global Laser Enrichment,” GE-Hitachi, https://nuclear.gepower.com/fuel-a-plant/products/gle.html (accessed Feb. 22, 2015). At the time of GLE's announcement, the term market price for SWU was approximately $95, according to UxC's monthly price indicator.

    6. Long-Term Viability and Health of the Industry<