Federal Register Vol. 80, No.84,

This final rule implements the Debt Collection Improvement Act of 1996 (DCIA). The DCIA requires federal agencies to collect debts owed to the United States under regulations prescribed by the head of the agency, and standards prescribed by the Department of Justice and the Department of the Treasury. 31 U.S.C. 3711(d)(2). These standards, known as the Federal Claims Collection Standards (FCCS), became effective on December 22, 2000. 31 CFR chapter IX, parts 900 through 904.

The DCIA also requires agencies, prior to collecting debts owed to the United States, to: (1) Adopt, without change, regulations on collecting debts by offset promulgated by the Department of Justice or Department of the Treasury (FCCS); or (2) prescribe agency regulations for collecting such debts by offset, which are consistent with the FCCS. 31 U.S.C. 3716. Agency regulations protect the minimum due-process rights that must be afforded to the debtor when an agency seeks to collect a debt by administrative offset, including the ability to verify, challenge, and compromise claims, and access to administrative-appeals procedures which are both reasonable and protect the interests of the United States. Nothing in this regulation precludes the use of collection remedies not contained in this regulation.

The final rule is consistent with the FCCS, as required by the DCIA. The salary-offset portion of the rule has been submitted to and approved by the Office of Personnel Management (OPM), as required by 5 U.S.C. 5514(b)(1).

Subpart A of the final rule sets out the definitions, scope, and applicability of the FLRA's debt-collection procedures. The final rule provides procedures for the collection of FLRA debts as well as procedures for collection of other debts owed to the United States when the FLRA receives, from another agency, a request for offset of an FLRA payment. The FLRA shall follow the procedural standards for collecting debts set forth in the FCCS when it determines that it is appropriate to initiate debt collection or seek offset to collect a debt. 31 CFR parts 900 through 904. The rule does not apply to tax debts or to any debt for which there is an indication of fraud or misrepresentation, as described in § 900.3 of the FCCS. Additionally, the final rule does not preclude the FLRA from collecting debts under statutes and regulations other than those described in the final rule.

Subpart B of the final rule provides the procedures that the FLRA will use to collect debts. Among other things, subpart B outlines the due-process procedures that the FLRA is required to follow when using offset (administrative, tax refund, and salary) to collect a debt, when garnishing a debtor's wages, or before reporting a debt to a credit bureau. More specifically, the final rule describes the notice that the FLRA will send to a debtor when collecting the debt, including the FLRA's responsibilities and the debtor's associated rights and obligations related to the notice. The FLRA shall assess interest, penalties, and administrative costs on such debts in accordance with the provisions of 31 U.S.C. 3717 and 31 CFR 901.9. Subpart B also explains that the FLRA may waive those assessments, and it provides for situations in which the FLRA may accept payments in regular installments, in accordance with 31 CFR 901.8. The subpart also provides that the FLRA may suspend or terminate a debt and when it will transfer an FLRA debt to the Treasury Department's Financial Management Service for collection under 31 U.S.C. 3711(g) and 31 CFR 285.12. This subpart provides that an employee may request a waiver of the debt, if applicable, and references Appendix A of the final rule, which describes “Waiving Claims Against FLRA Employees for Erroneous Payments.”

Subpart C of the final rule authorizes the FLRA to collect debts owed to other federal agencies, and it describes the procedures to be followed when another agency would like to use the offset process to collect a debt from a nontax payment issued by the FLRA, as a payment agency. For example, any federal agency may request that the FLRA collect a debt owed to such agency by offsetting funds payable to a debtor by the FLRA, including salary payments issued to FLRA employees. This subpart describes where to send a request and provides that certification of the debt is required. Subpart C also describes what the FLRA will do upon receipt of a request to offset the salary of an FLRA employee, including, among other things, the notice given to the employee and the limits on the amount that the FLRA will deduct from an employee's salary.

The FLRA has determined that this rule pertains to agency practice and procedure and is interpretative in nature. The procedures contained in the rule for salary offset and administrative offset are mandated by law and by regulations promulgated by OPM, jointly by the Department of the Treasury and the Department of Justice, and by the IRS. Notice of proposed rulemaking is not required under the Administrative Procedure Act (APA) because the rule pertains solely to agency procedure and practice. 5 U.S.C. 553(b)(3)(A). Notice and an opportunity for public comment are not necessary prior to issuance of this final rule because it implements a definitive statutory scheme mandated by the DCIA. Likewise, pursuant to 5 U.S.C. 553(d)(3), the agency finds that good cause exists for not providing a delayed effective date.

Because no notice of proposed rulemaking is required for this rule, the provisions of the Regulatory Flexibility Act (5 U.S.C. 601 et seq.) do not apply. Moreover, the rule will affect only persons who owe delinquent nontax debts to the Treasury Department and other federal agencies. Accordingly, a regulatory-flexibility analysis is not required.

The final rule is not subject to the Paperwork Reduction Act (44 U.S.C. 3501), since it does not contain any new information-collection requirements.

This rule is not a significant regulatory action as defined in Executive Order 12866. Because no notice of proposed rulemaking is required for this rule, the provisions of the Regulatory Flexibility Act do not apply.

For the reasons set forth in the preamble, the FLRA adds 5 CFR part 2418 to read as follows:

We have been advised by Boeing of an issue identified during laboratory testing. The software counter internal to the generator control units (GCUs) will overflow after 248 days of continuous power, causing that GCU to go into failsafe mode. If the four main GCUs (associated with the engine mounted generators) were powered up at the same time, after 248 days of continuous power, all four GCUs will go into failsafe mode at the same time, resulting in a loss of all AC electrical power regardless of flight phase.

We are issuing this AD because we evaluated all the relevant information and determined the unsafe condition described previously is likely to exist or develop in other products of the same type design.

This AD requires a repetitive maintenance task for electrical power deactivation.

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

An unsafe condition exists that requires the immediate adoption of this AD. The FAA has found that the risk to the flying public justifies waiving notice and comment prior to adoption of this rule. If the four main GCUs were powered up at the same time, after 248 days of continuous power, all four GCUs will go into failsafe mode at the same time, resulting in a loss of all AC electrical power regardless of flight phase. Loss of all AC electrical power can result in loss of control of the airplane. Therefore, we find that notice and opportunity for prior public comment are impracticable and that good cause exists for making this amendment effective in less than 30 days.

This AD is a final rule that involves requirements affecting flight safety and was not preceded by notice and an opportunity for public comment. However, we invite you to send any written data, views, or arguments about this AD. Send your comments to an address listed under the ADDRESSES section. Include the docket number FAA-2015-0936 and Directorate Identifier 2015-NM-058-AD at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this AD. We will consider all comments received by the closing date and may amend this AD because of those comments.

We will post all comments we receive, without change, to http://www.regulations.gov, including any personal information you provide. We will also post a report summarizing each substantive verbal contact we receive about this AD.

We reviewed Boeing Multi Operator Message MOM-MOM-15-0248-01B, dated April 19, 2015; and Boeing Multi Operator Message MOM-MOM-15-0248-01B(R1), dated April 20, 2015. The service information describes procedures for electrical power deactivation of Model 787 airplanes. This service information is reasonably available at http://www.regulations.gov by searching for and locating Docket No. FAA-2015-0936. Or see ADDRESSES for other ways to access this service information.

We estimate that this AD affects 28 airplanes of U.S. registry. We estimate the following costs to comply with this AD:

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

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

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

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

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

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

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

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

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

We issued a notice of proposed rulemaking (NPRM) to amend 14 CFR part 39 to revise AD 2014-17-08, Amendment 39-17961 (79 FR 52172, September 3, 2014), (“AD 2014-17-08”). AD 2014-17-08 applied to all P&WC PT6A-114 and PT6A-114A turboprop engines. The NPRM published in the Federal Register on December 1, 2014 (79 FR 71031). The NPRM was prompted by P&WC development of an additional single crystal CT blade that corrects the unsafe condition. The addition of this new part number (P/N) reduces the affected population. The NPRM proposed to retain all the requirements of AD 2014-17-08. The NPRM also proposed to add the additional single crystal CT blade that corrects the unsafe condition, reduce the affected population, and correct the Credit for Previous Action paragraph. We are issuing this AD to prevent failure of CT blades, which could result in damage to the engine and damage to the airplane.

We gave the public the opportunity to participate in developing this AD. The following presents the comments received on the NPRM (79 FR 71031, December 1, 2014) and the FAA's response to each comment.

Hawkins Aero Engineering, Inc. and another commenter requested that we state more clearly whether pre-SB (service bulletin) PT6A-72-1669 CT blades removed as a result of this AD can be reinstalled in the same engine, the same model engine, or a different model engine.

We disagree. Paragraph (e)(1)(iii)(B) of this AD clearly states that to re-install removed pre-SB PT6A-72-1669 CT blades, the blades must pass a two-blade metallurgical inspection to determine airworthiness in accordance with paragraph 3.B., Accomplishment Instructions, of P&WC Service Bulletin (SB) No. PT6A-72-1669, Revision 9, dated June 28, 2013. We did not change this AD.

One commenter requested that we not mandate the installation of single crystal CT blades because two of the P/Ns cited as replacement blades have experienced low-time failures, indicating a design or manufacturing flaw.

We disagree. While there have been some failures of single crystal CT blades on a different engine model, that failure mode is well understood and does not affect the engines that are the subject of this AD. For the engines that are subject to this AD, single crystal blades provide a significant improvement in durability and a significant reduction in CT blade failures overall. We did not change this AD.

One commenter requested that we reference P&WC SBs No. PT6A-72-1727 and No. PT6A-72-1749 in addition to P&WC SB No. PT6A-72-1669 because each one of these SBs references one of the three single crystal CT blades that can be installed as terminating action to this AD. P&WC SB No. PT6A-72-1669 alone only references one of the three blades listed as terminating action in paragraph (e)(2) of this AD.

We agree. We added references to the two additional SBs in paragraph (h)(2) of this AD.

Hawkins Aero Engineering, Inc. requested that we include in the AD an AMOC to allow a visual inspection, accomplished by splitting the engine at the C-flange, as an alternative method to the required periodic borescope inspection of pre-SB PT6A-72-1669 CT blades. The commenter states that this suggested visual method would provide easier detection of cracks.

We disagree. This AD contains the required method for resolving the unsafe condition. If an operator can accomplish required actions in a better way, or a way that better suits the operator's business processes, and the alternative method provides an acceptable level of safety, then the operator can apply for an AMOC to use that method to address the unsafe condition in accordance with paragraph (g)(2) of this AD. We did not change this AD.

Hawkins Aero Engineering, Inc. requested that we address single crystal CT blade failures either in this or in another AD because there have been several low-time single crystal CT blade failures in several different PT6 engine models, some of which are single engine installations.

We disagree. Low-time failures that occurred on engine models not affected by this AD are due to a failure mode that is well understood. That failure mode does not occur in the engine models that are the subject of this AD. We did not change this AD.

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

• Are consistent with the intent that was proposed in the NPRM (79 FR 71031, December 1, 2014) for correcting the unsafe condition; and

• Do not add any additional burden upon the public than was already proposed in NPRM (79 FR 71031, December 1, 2014).

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

We estimate that this AD affects 300 engines installed on airplanes of U.S. registry. We also estimate that it would take about 4 hours per engine to perform the required inspection and 8 hours to replace the blades. The average labor rate is $85 per hour. Required parts cost about $59,334 per engine. Based on these figures, we estimate the cost of this AD on U.S. operators to be $18,106,200.

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

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

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

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

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

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

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

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

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

This document amends FAA Order 7400.9Y, airspace Designations and Reporting Points, dated August 6, 2014, and effective September 15, 2014. FAA Order 7400.9Y is publicly available as listed in the ADDRESSES section of this final rule. FAA Order 7400.9Y lists Class A, B, C, D, and E airspace areas, air traffic service routes, and reporting points.

This action amends Title 14 Code of Federal Regulations (14 CFR) Part 71 by removing reference to Restricted Area R-2936 from the regulatory text of the Class D airspace area at William P. Gwinn Airport, Jupiter, FL, as the restricted area is no longer needed. This action also updates the airport's geographical coordinates to be in concert with the FAA's aeronautical database.

This is an administrative change and does not affect the boundaries, or operating requirements of the airspace, therefore, notice and public procedure under 5 U.S.C. 553(b) are unnecessary.

The FAA has determined that this regulation only involves an established body of technical regulations for which frequent and routine amendments are necessary to keep them operationally current. Therefore, this regulation: (1) Is not a “significant regulatory action” under Executive Order 12866; (2) is not a “significant rule” under DOT Regulatory Policies and Procedures (44 FR 11034; February 26, 1979); and (3) does not warrant preparation of a regulatory evaluation as the anticipated impact is so minimal. Since this is a routine matter that only affects air traffic procedures and air navigation, it is certified that this rule, when promulgated, does not have a significant economic impact on a substantial number of small entities under the criteria of the Regulatory Flexibility Act.

The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the U.S. Code. Subtitle 1, Section 106, describes the authority of the FAA Administrator. Subtitle VII, Aviation Programs, describes in more detail the scope of the agency's authority. This rulemaking is promulgated under the authority described in Subtitle VII, Part A, Subpart I, Section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it further clarifies the description of controlled airspace at William P. Gwinn Airport, Jupiter, FL.

In consideration of the foregoing, the Federal Aviation Administration amends 14 CFR part 71 as follows:

I. Background

The purpose of implementing this final rule regarding the valuation of oil production from Indian leases is: (1) To ensure that Indian mineral lessors receive the maximum revenues from mineral resources on their land consistent with the Secretary of the Interior's (Secretary) trust responsibility and lease terms and (2) to provide simplicity, certainty, clarity, and consistency for Indian oil valuation for Indian mineral revenue recipients and Indian mineral lessees.

On June 19, 2014, ONRR published a Notice of Proposed Rulemaking (79 FR 35102) to amend the valuation regulations for oil production from Indian leases. The proposed rule represents the recommendations of the Indian Oil Valuation Negotiated Rulemaking Committee (Committee). The proposed rulemaking provided for a 60-day comment period, which ended on August 18, 2014. During the public comment period, ONRR received fifteen written comments: two responses from industry, three from industry trade groups or associations, three from Indian Tribes, four from individual Indian mineral owners, and three from unassociated individuals.

ONRR has carefully considered all of the public comments that it received during the rulemaking process. ONRR hereby adopts final regulations governing the valuation of oil produced from Indian leases. These regulations will apply, prospectively, to oil produced on or after the effective date that we have specified in the DATES section of this preamble.

This final rule reflects other changes to the proposed rule. In the preamble of the proposed rule, ONRR requested comments on: (1) Eliminating the current regulation's requirement that a lessee must file a Form ONRR-4110 to claim an arm's-length transportation allowance, which would mirror the Indian gas valuation rule at 30 CFR 1206.178(a)(1)(i); (2) removing the current rule's requirement that lessees reporting non-arm's-length transportation arrangements submit a Form ONRR-4110 with estimated information prior to taking the transportation allowance, again this change would mirror the Indian gas valuation rule found at § 1206.178(b)(2)(i); (3) eliminating a lessee's ability to use transportation factors in calculating its royalties due under § 1206.57, and, instead, requiring lessees to report all transportation costs as separate entries for transportation allowances on Form ONRR-2014; and (4) removing the ability for a lessee to request to exceed the 50-percent limitation on transportation allowances. As we discuss in more detail below, ONRR amended the current rule to (1) eliminate form filing requirements for arm's-length transportation allowances and (2) eliminate the pre-filing of Form ONRR-4110 prior to claiming a non-arm's-length transportation allowance.

ONRR received fifteen comments on the new rule. The majority of commenters expressed support for the rule. Other general comments fall into three categories: (1) ONRR's trust responsibilities, (2) increased communication with Indian lessors, and (3) the rule's impact on Indian lease royalty rates.

Public Comment: ONRR received two comments requesting that ONRR emphasize that the purpose of the proposed rule is to maximize revenues to Indian lessors under Interior's trust responsibility. A Tribe indicated that ONRR also should modify the language in the preamble of the final rule to mirror the language that is in the proposed Indian gas rule to clarify that the purpose of the rule is to maximize revenues for the Indian lessor.

In contrast, an individual commenter disputed the proposed rule because the commenter believes that the Tribes, not ONRR, should be establishing oil prices on Indian lands. The commenter stated that the Secretary's role is solely to approve or disapprove Indian agreements and should not take on any fiduciary responsibilities.

ONRR Response: ONRR has included language in the preamble of the final rule that states that the purpose of the rule is to maximize revenues for the Indian lessor, mirroring language contained in the preamble of the Indian gas valuation rule.

The United States Government has a unique legal relationship with American Indian Tribal governments, stemming from the Constitution of the United States. Over time, treaties, Federal statutes, regulations, and court decisions have refined the relationship to be one that is committed to protecting and respecting the rights of self-government of sovereign Tribal governments. Thus, Federal Indian statutes and regulations have evolved to rest certain obligations on the Federal Government.

The Indian Mineral Leasing Act of 1938, 25 U.S.C 396a-396g, grants the Secretary the authority to oversee the leasing and development of Indian mineral resources. By enacting the Indian Mineral Leasing Act, Congress intended the Secretary to act as a trustee to Tribes and Indian mineral owners. Jicarilla Apache Tribe v. Supron Energy Corp., 728 F.2d 1555, 1565 (10th Cir.1984) (Seymour, J., concurring in part and dissenting in part), adopted as majority opinion as modified en banc, 782 F.2d 855 (10th Cir.1986), supplemented, 793 F.2d 1171 (10th Cir. 1986), cert. denied, 479 U.S. 970 (1986). As a trustee, when “faced with a decision for which there is more than one `reasonable' choice as that term is used in administrative law, [the Secretary] must chose the alternative that is in the best interests of the Indian tribe.” Jicarilla v. Supron, Id. at 1567.

Furthermore, Tribes and individual Indian mineral owners can negotiate mineral leasing agreements under the Indian Mineral Development Act of 1982, 25 U.S.C. 2101-2108. Consistent with principles of self-determination, Tribes and individual Indian mineral owners, through Tribal affiliation, can negotiate valuation terms in their leases, subject to Secretarial approval. The Secretary has a duty to administer Indian oil and gas leases, including enforcing royalty obligations under those leases.

Public Comment: ONRR received a comment seeking amendment to the rule requiring lessees to provide daily oil production reports. The commenter stated that daily oil production reports would “ensure the timely marketing of the produced oil and that the production cycle is not interrupted.”

ONRR Response: ONRR appreciates the comment. The comment, however, is beyond the scope of this rulemaking, which is limited to the valuation of oil produced from Indian leases. ONRR receives monthly oil and gas reports, which are sufficient for us to ensure proper production verification and accountability. Through audits and other compliance activities, ONRR can, if necessary, obtain daily information to verify that lessees have properly accounted for and reported their Indian oil production.

Public Comment: ONRR received two comments seeking improved access to data to allow Indian lessors to monitor their leases—by wells—on a monthly basis. Both commenters felt that the Explanation of Payment Report (EOP) that the Bureau of Indian Affairs currently sends with royalty payments to Indian lessors on a monthly basis is insufficient to provide a clear picture of the Indian lessor's oil and gas production. One commenter felt that ONRR should post individual well information on its Web site for Indian lessors to monitor their leases.

ONRR Response: ONRR appreciates the comment. The comment, however, is beyond the scope of this rulemaking, which is limited to the valuation of oil produced from Indian leases. Under the Federal Oil and Gas Royalty Management Act (FOGRMA), the Secretary must provide an EOP when a lessee makes any payment to an Indian lessor. 30 U.S.C. 1715. The Secretary must include “a description of the type of payment being made, the period covered by such payment, the source of such payment, production amounts, the royalty rate, unit value and such other information as may be agreed upon by the Secretary and the recipient State, Indian tribe, or Indian allottee.” Id.

ONRR generally does not receive royalty payment information by well because the information is voluminous and can include multiple leases, multiple communitization areas, and multiple lessors. And the lease, not the well, typically provides the basis for financial reporting, including financial terms against which ONRR assures compliance by companies and distributes royalties to Indian lessors.

Furthermore, the rule will require ONRR to post Index-Based Major Portion (IBMP) prices on its Web site. Thus, the proposed rule will increase the capacity for Indian lessors to validate the royalties that they receive are accurate. For applicable leases, if the volume-weighted price shown on the EOP is less than the IBMP value posted on ONRR's Web site, the Tribe and/or individual Indian mineral owner will know that there is a discrepancy based on the value of oil, the volume of the oil, and the lease's royalty rate.

Public Comment: ONRR received two comments regarding the royalty rates in the leases. One commenter stated that “the proposed rule leaves no ability for the lessor to negotiate a rate when the opportunity presents itself.” Another stated that “the Secretary has refused to negotiate royalty rates for which the Secretary is responsible.”

ONRR Response: ONRR appreciates the comments. The royalty rate, however, is a clause in the lease and is not a component of the proposed rule. Under the Indian Mineral Development Act, Tribes and individual Indian mineral owners are free to negotiate lease terms with potential lessees, subject to Secretarial approval. 25 U.S.C. 2102. The proposed rule does not limit or otherwise infringe on the authority of Tribes to negotiate those leases. The BIA regulations set out a minimum royalty rate, see 25 CFR 211.41(b); 212.41(b), and Indian lessors are free to negotiate a higher royalty rate. Nothing in this rule prevents Indian lessors from doing so.

Public Comment: In addition, a Tribal commenter stated that the proposed rule implicitly states that the Secretary's trust responsibility will not apply to Tribes in Eastern Oklahoma because the rule is not applicable to District Court leases, which do not contain a major portion provision or provide for Secretarial discretion to determine value.

ONRR Response: The purpose of the rule is to provide a method to calculate value under the major portion provision found in most Indian leases. The rule does not change how to value Indian oil on leases that do not contain a major portion provision. The commenter is correct that the rule will not apply to District Court leases because those leases do not contain a major portion provision or provide for Secretarial discretion to determine value. Therefore, valuing Indian oil produced from these leases will not change under the proposed rule. Indian lessors remain free to negotiate their royalty rates. And, as stated previously, the rule does not alter a lessor's ability to negotiate new leases or lease terms.

Public Comment: ONRR received a comment recommending that ONRR use an “Adjustment Ratio (AR)” instead of the Location and Crude Type Differential (LCTD). The commenter proposes an AR as the ratio of the Major Portion Price to the New York Mercantile Exchange (NYMEX) Calendar Monthly Average (CMA), which would be equal to the LCTD, but would take fewer steps to calculate and, thus, decrease the chance of error.

ONRR Response: ONRR agrees with the commenter that the initial Adjustment Ratio (AR) would return the same result as the initial LCTD. The method used in the proposed rule, however, makes explicit use of the differential between the major portion price and NYMEX CMA so that those less familiar with the formula can clearly see how the Index-Based Major Portion is calculated. Therefore, ONRR will retain the LCTD in the final rule because it is more transparent.

Public Comment: ONRR received two comments regarding the LCTD. One commenter recommended amending the rule to eliminate the 10-percent adjustment mechanism for the LCTD. That commenter stated that, in months where lessees report more than 28 percent of the production as non-OINX (the gross proceeds that the lessee receives for volumes sold above the IBMP value), ONRR has the data that it needs to calculate the 75-percent major portion price. Thus, the commenter states that ONRR should use that number rather than the IBMP value because that is the price at which 75 percent of production was sold in the designated area. In months where lessees report volumes of a specific crude type in a particular designated area as non-OINX fall below 22 percent, the commenter proposes multiplying the AR by 0.98.

ONRR Response: The commenter correctly states that, in months where there is more than 28 percent of the production reported in a particular designated area for a specific crude type as non-OINX, ONRR has the price at which the 75th percentile of oil is sold. ONRR, however, disagrees that the Agency should use that price as the major portion price. First, the price will not be contemporaneous with the current production month. The commenter's recommendation will require ONRR to base the value of the Indian oil production on sales that occurred two production months prior to the current production month—effectively putting the IBMP price two months in arrears from the current reporting month. In contrast, the IBMP value uses the most recent NYMEX prices adjusted by the LCTD, which is contemporaneous with the production month. Thus, under the final rule, the data that ONRR uses results in an adjustment of the most recent NYMEX CMA price.

Second, the commenter does not clarify how ONRR would return to using an LCTD once the amount of production not reported as non-OINX falls below 28 percent. Instead, the commenter suggests using the commenter's original AR and multiplying that by 0.98 to adjust the IBMP value. As we discussed above, however, ONRR is not amending the rule to use the AR. And, this methodology falls outside of the recommendations of the Committee. Lastly, ONRR is unclear how the 0.98 adequately replaces the LCTD adjustment.

Public Comment: ONRR received another comment regarding the proposed rule's 10-percent adjustment to the LCTD. The commenter stated that the 10-percent adjustment appears arbitrary and does not take into account severe swings in the market.

ONRR Response: ONRR disagrees that the 10-percent adjustment mechanism is arbitrary. The Committee negotiated the 10-percent adjustment to allow ONRR to adjust the LCTD to reflect swings in the market. The Committee negotiated the 10-percent adjustment to ensure that the IBMP value will return to the 22-percent-to-28-percent range in the event that the IBMP value does fall outside of that range. The Committee, however, limited the adjustment to 10 percent to prevent drastic swings in the LCTD from month to month.

Public Comment: ONRR received multiple comments regarding how ONRR calculates the IBMP value. ONRR received one comment stating that the formula that ONRR uses to calculate the IBMP value is too complex and difficult for the Indian lessor to understand. The commenter further believes that the calculation is labor-intensive and susceptible to error.

ONRR Response: ONRR appreciates the comment. While the formula may appear complex, ONRR will calculate the IBMP value each month and post the value on our Web site. Industry will then report and pay royalties on the higher of its gross proceeds or the posted IBMP value. Like the Indian Gas Major Portion calculation, ONRR will automate the process with internal controls to mitigate the risk of error. ONRR will provide training to those Tribes who would like to better understand the rule and to industry, who must comply with the rule.

Public Comment: Other commenters raised concerns regarding ONRR's shift from defining the major portion price in an area to be the price at which 50 percent by volume plus one barrel of oil is sold to using the price at which 25 percent, plus one barrel, by volume (starting from the top) of oil in an area is sold. One industry commenter states the 75th percentile is not a “major” portion—a major portion would be the 50 percent plus one barrel used under the current rule.

ONRR Response: ONRR incorporated the 75th percentile as the major portion of production based on (1) consistency with the Indian gas valuation rule and (2) the agreement reached by Committee. The Committee spent a significant amount of time deliberating what to use as a major portion price. Representatives for the Indian lessors advocated for a major portion price using the 75th percentile. Industry supported a major portion price based on the 50th percentile. Ultimately, industry representatives agreed to the 75th percentile in exchange for the benefits of the rule, including but not limited to: (1) Reduced accounting and administrative costs; (2) certainty associated with meeting the major portion obligation in real time; (3) significant reduction in prior period adjustments; (4) simplified audits and related expenses; and (5) reduced administrative appeals and litigation. In return, Indian lessors receive (1) royalties on their oil production founded on an index-based price equivalent to a 25-percent major portion from the top or the gross proceeds that their lessees receive; (2) more predictable and transparent information on revenues that they can expect to receive; and (3) royalties based on the leases' major portion provision sooner and with fewer adjustments. The Committee agreed to use the price at which 25 percent or more of the oil from the top is sold as a reasonable compromise on the term “major.” The change in the major portion value is identical to the trade-off that ONRR and the Indian Gas Valuation Negotiation Rulemaking Committee agreed upon prior to adopting the final Indian Gas Valuation Rules in 1999. Industry representatives agreed to the change in exchange for clarity, certainty, and reduced administrative costs.

Public Comment: ONRR also received a comment from an individual asserting ONRR “has not enforced the major portion provision or disclosed facts essential to understanding a claim. . . .”

ONRR Response: The final rule applies prospectively and will not impact ONRR's efforts to enforce the major portion provision under the prior rule.

Public Comment: One industry commenter noted that the 25-percent major price component in the rule will result in the commenter realizing the full 3.93-percent increase in royalties that ONRR estimated that industry would pay under the proposed rule.

ONRR Response: The 3.93 percent discussed in the preamble of the proposed rule is only to show, on average, the minimal impact of the proposed rule industrywide. The commenter's royalties may increase more or less than 3.93 percent.

Public Comment: ONRR also received a comment implying that the IBMP value is inadequate because it includes cost sharing. The commenter proposed to value oil produced from Indian lands by paying the Indian lessor 25 percent of the current NYMEX price, less the LCTD. The commenter stated that the LCTD should be allowed, but it should only capture the difference in value due to location and quality and that ONRR should eliminate any transportation allowances and any other costs/allowances. In so doing, the commenter states that ONRR will maximize the revenue of the Indian lessor.

ONRR Response: ONRR disagrees. ONRR maintains that the final rule maximizes revenues for Tribes and individual Indian mineral owners. The final rule ensures that the lessor receives the higher of (1) a value that approximates the major portion price at the 25th percentile by volume plus one barrel from highest price to lowest price, arrayed from the top (the top means that volume associated with the highest price that lessees receive for crude oil produced in a particular designated area in any given month); or (2) the gross proceeds accruing to the lessee. ONRR addresses the commenter's view on the elimination of transportation allowances under section 6 of the response to specific comments.

Public Comment: ONRR received three comments regarding the data that it uses to calculate the IBMP. Two Tribal commenters stated that ONRR must rely on audited data to calculate the initial LCTD for each designated area. The Tribal commenters are concerned that unaudited data may include inaccurate data that will have lingering and ongoing effects on the IBMP value. In contrast, ONRR received a comment from an individual stating that ONRR cannot go back and change the IBMP regardless if ONRR found errors in reported information.

ONRR Response: All oil production and sales reported to ONRR are subject to review and audit. Currently, ONRR has upfront edits, i.e. automated verifications, in place in our reporting systems, as well as data mining activities, which minimize inaccurately reported data. Moreover, as ONRR inputs the data that it uses to calculate the initial LCTD and future adjustments, ONRR will scrutinize the data to identify and resolve outliers as well as grossly misreported royalty volumes and values. Additionally, the large amount of data necessary to calculate the LCTD for any designated area will minimize the effects of individual misreported data. ONRR feels that these tools will adequately prevent bad data from influencing the initial LCTD calculation. In order to begin collecting royalties on the IBMP value, ONRR is using the previous 12 months of data collected. As we discussed above, ONRR will edit and scrutinize that data before using it in the formula. This approach represents a trade-off between using audited data, which can take three or more years to complete, and using the IBMP value formula, which results in contemporaneous payment of major portion obligations and early certainty for the Indian lessors.

In the preamble of the proposed rule, ONRR requested comments on whether ONRR should modify paragraph (e) of 30 CFR 1206.54 to provide that ONRR will use its discretion to determine an appropriate IBMP value where there are insufficient lines reported to ONRR on Form ONRR-2014 to determine a differential for a specific crude oil type or when the LCTD varies more than +/- 20 percent. In addition, ONRR requested comments on what would constitute a significant variation.

Public Comment: ONRR only received one general comment on § 1206.54(e). The commenter recommended that ONRR uses the Indian oil valuation standards found in the current oil rule to guide ONRR's discretion to ensure that the IBMP value is tied to the express terms of the lease.

ONRR Response: The provision in § 1206.54(e) providing ONRR with discretion allows ONRR to calculate a value if, for unforeseen circumstances, the data in a particular designated area for a particular crude type would prevent ONRR from accurately calculating the IBMP value. ONRR would still rely on information regarding like-quality oil and the location of the lease to calculate an appropriate differential, consistent with the lease terms. For example, ONRR may use its discretion to review sales data from nearby Federal leases to calculate the differential in situations where a designated area may have insufficient data to calculate an LCTD. Furthermore, ONRR identified designated areas to ensure that there is adequate information provided in the Form ONRR-2014 to calculate the IBMP value.

ONRR decided not to adopt a rule providing us with the discretion to calculate an IBMP value when the LCTD varies more than +/−20 percent. Instead, we will use the final rule's LCTD 10-percent adjustment mechanism to approximate, as close as possible, the 25th percentile major portion price.

Public Comment: A Tribal commenter indicated that Oklahoma should not be a single designated area. The Tribal commenter is concerned that using Oklahoma as a single designated area does not take into account varying transportation costs and differences in the quality of oil.

ONRR Response: In evaluating whether to use the State of Oklahoma as a Designated Area, ONRR analyzed prices and crude types across Oklahoma. In performing the analysis, ONRR did not find that there were any significant differences in the quality of the oil and the price of the oil sufficient to warrant separate designated areas, and, hence, separate LCTD calculations. The proximity of the Indian oil producing leases in Oklahoma to Cushing, Oklahoma, (the market center that serves as the basis of the IBMP value under this rule) reduced the impact of the location differential on the price of the oil. ONRR performed an analysis for the Committee, showing that transportation costs throughout Oklahoma were relatively small and that such costs do not demonstrate a consistent cost difference between leases in close proximity to Cushing and those further away. Although the Designated Area of Oklahoma is in close proximity to Cushing, Oklahoma, ONRR concluded an LCTD was warranted for Oklahoma. Because of its proximity to Cushing, Oklahoma, however, the LCTD for Oklahoma will be minimal.

Public Comment: An individual commenter suggested that ONRR remove the Muscogee (Creek) Nation and the Seminole Nation's lands in Osage County, Oklahoma, and designate those lands as a “Designated Area.”

ONRR Response: ONRR has confirmed that the Osage Nation owns all of the mineral rights in Osage County, Oklahoma. FOGRMA excludes Osage Indian lands. 30 U.S.C. 1702 (3). Therefore, ONRR cannot include Osage County as its own designated area or enforce the rule on Indian mineral production from Osage County, Oklahoma.

Public Comment: ONRR also received a comment from an industry commenter stating that ONRR has not provided the criteria it will use to determine when to modify or add designated areas. The commenter worries that there is no mechanism for industry “to petition ONRR to modify a designated area in the event that the designated area contains diverse geography and distinguishable access to infrastructure (such as pipelines, rail lines, and trucking).”

ONRR Response: The final rule and the preamble of the proposed rule specifically address the commenter's concerns. The final rule at 30 CFR 1206.51 lists criteria that ONRR will use to determine any future changes to designated areas that are identical to the very criteria that the commenter lists. Such criteria include markets served (such as refineries and market centers) and access to infrastructure (including trucking, pipelines, or rail). 30 CFR 1206.151 (final rule).

Moreover, the preamble to the proposed rule states: “If there is a significant change that affects the differentials for a designated area, affected Tribes, Indian mineral owners, or lessees/operators may petition ONRR to consider conveying a technical committee to review, modify, or add designated areas.” 79 FR 35102; 35104 (Jun. 19, 2014). ONRR will look at the same criteria that we outlined in the final rule to determine any future changes to designated areas. Id.

Public Comment: The industry commenter also takes issue with the final rule's use of “Designated Areas” over “fields” to calculate a price for ONRR to use to calculate the major portion price. The commenter believes that the use of a designated area is inconsistent with the lease language.

ONRR Response: The primary purpose of creating the Committee was to come to a consensus on how to implement the major portion provision found in most Indian leases. Determining the geographic range of data to use to calculate a major portion provision was one of the most highly debated topics in the Committee meetings. As a general rule, Committee members who represented industry advocated for the use of specific fields to calculate a value of oil sold under the major portion provision. Alternatively, Tribes and allottees promoted a broader area focused more on an oil type than the geographic location of the lease. The debate turned to implementing the rule on a field level versus a broader area. Ultimately, the Committee agreed to use “designated areas” developed based on the set criteria defined in the final rule. All meeting presentations, handouts, and meeting minutes are available on the Committee Web site at http://www.onrr.gov/Laws_R_D/IONR/.

The commenter interprets the lease terms as requiring the Secretary to perform a major portion analysis solely on a field-by-field basis. Standard Indian lease forms commonly include a provision that states:

The rationale of using an area over a field is to ensure that there is a reasonable sample of data to conduct a major portion analysis. ONRR must meet both the requirements of the major portion provision in the leases and the Trade Secrets Act. Under the Trade Secrets Act, ONRR cannot reveal or release information that can be considered a trade secret because doing so may cause competitive harm. The Department has adopted a policy that financial and commercial data is proprietary. ONRR uses financial and commercial data that payors report to conduct a major portion analysis. Thus, ONRR has determined that, to perform a major portion analysis, it needs an area large enough to have at least three payors. Otherwise, it would be possible for a party to use the value data that ONRR provides with its calculations, combine it with other publicly available data, and determine the price that other industry members are selling their oil.

ONRR has consistently interpreted the Secretary's discretion language in Indian leases as allowing ONRR to evaluate the major portion price in areas as well as fields. See 30 CFR 1206.152; 1206.52; 1206.51; 30 CFR 206.103 (1984); and Notice to Lessees and Operators of Indian Oil and Gas Leases (NTL-1A), 42 FR 18135 (Apr. 5, 1977). In fact, under the Indian gas valuation rule, ONRR calculates the major portion price for Indian-gas-based designated areas similar to those proposed in this rule. See 30 CFR 1206.173(a)(2)(i) (2013).

The Navajo Nation Reservation provides an example of ONRR's reasoning to expand the field to a designated area. Ninety-seven percent of production on the Navajo Nation Reservation comes from one field and reservoir, the Greater Aneth Field in the Paradox Basin. Six payors report production from the Greater Aneth Field. The remaining 3 percent of production on the Navajo Nation Reservation comes from 24 fields with less than three payors on 22 of those 24 fields. The oil produced and sold on the Navajo Reservation is similar in all fields and is transported to the same refinery using similar transportation systems. Thus, to properly perform a major portion analysis for any oil production on the Navajo Reservation, ONRR expands the Designated Area to incorporate fields surrounding the Greater Aneth because the individual fields do not provide an appropriate sample size.

Public Comment: The same commenter next disputes ONRR's use of an entire reservation as a designated area. The commenter believes that using a reservation as a designated area fails to accurately account for local price differences and transportation costs that can vary within the reservation. The commenter uses the Navajo Nation Reservation as an example, illustrating the difficulties of obtaining accurate differentials. The commenter further states that it does not see that ONRR took into consideration geography and access to infrastructure within the reservations when we created the designated areas based on reservation boundaries.

ONRR Response: The Committee had exhaustive and extensive discussions regarding the amount and variation of transportation for each of the designated areas, including the factors that the commenter lists. As discussed above, ONRR evaluated the oil produced on the Navajo Nation Reservation, including the quality of the oil produced, transportation methods, and refineries used. Based on ONRR's analysis, the Committee determined that one Designated Area on the Navajo Nation Reservation adequately captured the differentials between oil produced on the reservation and oil sold in Cushing.

Public Comment: ONRR received two comments in response to its request for comments on how ONRR changes the roll. ONRR sought comments on the flexibility of changing how it defines the roll or terminating the roll, with the caveat that it will publish any changes to the roll in the Federal Register. An industry commenter supported the ability for ONRR to terminate or redefine the roll only if such changes are published in the Federal Register, and ONRR provides industry the opportunity to comment on the proposed change. The second commenter suggested that ONRR eliminate the roll from its calculations altogether. The roll applies only to Indian oil produced in Oklahoma.

ONRR Response: ONRR will publish any changes to the roll in the Federal Register to provide notice and the opportunity for comment. ONRR incorporates the roll based on the agreement of the Committee and the fact that most contracts for oil sold from Indian leases in Oklahoma, which reference NYMEX prices, include the roll. Therefore, ONRR is keeping the roll in the final rule.

Public Comment: ONRR received comments from five individual Indian mineral owners and one Tribe arguing that ONRR does not have the authority to include transportation allowances as part of the royalty equation.

ONRR Response: ONRR disagrees. The Act of June 30, 1834 (25 U.S.C. 9); the Act of March 3, 1909 (25 U.S.C. 396); the Indian Mineral Leasing Act of 1938 (25 U.S.C. 396a-396g); the Indian Mineral Development Act of 1982 (25 U.S.C. 2101, et seq.); and the FOGRMA (Pub. L. 97-451; 30 U.S.C. 1701 et seq.) authorize the Secretary to promulgate whatever regulations are necessary to implement those statutes.

The rationale for allowing lessees to deduct transportation costs comes from the language of the lease. Generally, Indian oil leases provide that the lessee will pay the Tribe or individual Indian mineral owner a certain percent of the “value or amount of all oil, gas, and/or natural gasoline, and/or all other hydrocarbon substances produced and saved from the land leased herein.” See Standard Indian Allotted Lease, para. 3(c) (Emphasis added). In essence, transportation allowance accounts for the costs that a lessee must incur to move its production to a market and, therefore, captures the value at the lease. The lessor shares in this expense because the lessor reaps the benefit of selling its lease production at a market rather than at the wellhead. If the lessor were to take its royalties in kind (i.e. in barrels of oil), the lessor would then incur all of the cost of transporting the oil production to a market to sell the oil.

To comply with this provision, for decades ONRR's regulations have allowed a lessee to deduct its transportation costs to calculate the value of their Indian oil production when it sells that oil at a location remote from the lease. See 53 FR 1184 (Jan. 15, 1988) (promulgating rule incorporating transportation allowances to determine the value of Federal and Indian oil production, for royalty purposes). ONRR has consistently allowed transportation costs because transporting oil to market off of the lease increases the value of the oil.

Courts have upheld the use of transportation allowances as a means to calculate the value of oil production for royalty purposes. See United States v. General Petroleum Corp. of California, 73 F. Supp. 225, 262 (S.D. Cal. 1946), aff'd sub nom Continental Oil Co. v. United States, 184 F.2d 802 (9th Cir. 1950) (stating “It has been held that if there is no open market in the place where an article ordinarily would be sold, the market value of such article in the nearest open market less cost of transportation to such open market becomes the market value of the article in question.”). The IBLA has confirmed allowing such deductions to Indian leases, consistent with Interior policy. Kerr-McGee Corp., 22 IBLA 24 (1975).

Public Comment: One commenter claims that allowing lessees to deduct transportation allowances from the value of their oil is a taking that is prohibited by the Fifth Amendment of the U.S. Constitution.

ONRR Response: ONRR disagrees. Under the Fifth Amendment of the U.S. Constitution, the Federal government cannot deprive a person of “life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.” This provision is not violated or implicated by the final rule. This final rule will not impose conditions or limitations on the use of private property, and this final rule does not modify the current regulations to allow additional transportation costs. Therefore, this final rule does not result in a takings.

Public Comment: A Tribal commenter commented on using a statewide index for transportation costs in Oklahoma when the costs of transportation in the State will vary from location to location, thus “increasing with distance from the point of sale.”

ONRR Response: The Committee debated the issue of whether to allow location differentials for Oklahoma as a designated area. As we stated previously, ONRR performed an analysis for the Committee showing that there were small amounts of transportation costs that Indian lessees claimed throughout Oklahoma. The analysis showed that, although there were small amounts of transportation in Oklahoma, such costs did not demonstrate a consistent cost difference between leases in close proximity to Cushing and those further away. ONRR found that a lease located within a few miles of Cushing may have a higher transportation cost than a lease hundreds of miles away. Although the Designated Area of Oklahoma is in close proximity to Cushing, Oklahoma, ONRR concluded that an LCTD was warranted for Oklahoma. However, because of its proximity to Cushing, Oklahoma, the LCTD for Oklahoma will be minimal.

In addition to the major portion component of the proposed Indian oil valuation rule, ONRR requested comments concerning amending some of the provisions governing transportation allowances. Specifically, ONRR requested comments on (1) eliminating the requirement under the current rule to file a Form ONRR-4110, Oil Transportation Allowance Report, for arm's-length transportation agreements, which would mirror the requirement to file arm's-length transportation contracts with ONRR—rather than a form—under the current Indian Gas Valuation Rule at 30 CFR 1206.178(a)(1)(i); (2) removing the requirement that lessees submit a Form ONRR-4110 for non-arm's-length transportation allowances in advance of claiming an allowance and, instead, submit actual cost information in support of the allowance on its Form ONRR-4110, again mirroring the current Indian Gas Rule; (3) eliminating transportation factors under § 1206.57(a)(5); and (4) eliminating a lessee's ability to request to exceed the 50-percent limitation on transportation allowances under the current rule at § 1206.56(b)(2).

Public Comment: Generally, commenters supported removing the form filing requirements for arm's-length transportation allowances. A couple of industry commenters, however, requested guidance on what types of agreements that ONRR would require in order to claim a transportation allowance and what format ONRR would accept the agreement to be in (hardcopy, email, flashdrive, etc.). A Tribal commenter recommended that ONRR require lessees to provide hard copies of their transportation contracts.

ONRR Response: The final rule mirrors the Indian Gas Valuation Rule and requires payors to file arm's-length transportation contracts with ONRR rather than Form ONRR-4110. See 30 CFR 1206.178(a)(1)(i). ONRR will provide guidance to payors on the acceptable types and forms of contracts on a case-by-case basis, taking into consideration the Indian lessor's preferences.

Public Comment: For non-arm's-length transportation allowances, ONRR received two comments in support of the change proposed. The Tribal commenter, however, requested that ONRR require lessees to notify ONRR in advance that the lessee will apply a non-arm's-length transportation allowance against the value of the oil production. The Tribal commenter feels that this notice would be helpful in identifying areas of risk and discouraging lessees from failing to report transportation allowances.

ONRR Response: ONRR appreciates the comment and suggestion. The Form ONRR-4110 does not require lessees to provide notice and, at this time, ONRR will not require lessees to provide notice. ONRR understands the Tribal commenter's concerns regarding reporting transportation allowances. Under the current rule and final rule, however, lessees must report any non-arm's-length transportation allowances as a separate line on Form ONRR-2014. Should any auditor find that a lessee is reporting its oil production net of a transportation allowances, the auditor should refer the matter to ONRR's Office of Enforcement. ONRR's Office of Enforcement will investigate, enforce the regulations, and, where necessary, issue civil penalties.

Public Comment: ONRR received three opposing comments from industry and one supporting comment from a Tribe in response to its request for comments to eliminate transportation factors.

ONRR Response: ONRR believes that the increased transparency associated with eliminating transportation factors will better facilitate (1) ONRR's monitoring of oil values and (2) the accuracy of those values. Because of the other more important aspects of this rule, however, and our desire to have consistency with the Indian gas valuation rule, ONRR has decided to pursue this issue in a future rulemaking for both Indian oil and gas production.

Public Comment: One commenter stated that it opposed eliminating transportation factors because it could not find a definition of a transportation factor. The commenter indicated it was impossible to comment without such a definition. Another industry commenter stated that “transportation factors used for oil often include both a location and a quality differential, and it may not be possible to separate this factor between the two differentials.”

ONRR Response: The current rule does not provide a definition for a transportation factor. If an arm's-length contract price or posted price includes a provision by which the purchaser reduces the listed price to reflect the purchaser's transportation costs and then pays the lessee a net value under that arm's-length contract, ONRR deems the amount of the transportation reduction to be a transportation factor. A transportation factor is an actual transportation cost embedded in the arm's-length sales contract. See 30 CFR 1206.57. Because these actual transportation costs are part of what a lessee reports as the sales price of the oil that the lessee sells and are not separately reported transportation allowances, ONRR and its Indian lessors do not see the cost of transporting the oil to the point of sale as it would with transportation allowances. While ONRR believes that eliminating transportation factors increases transparency and certainty, ONRR has decided not to eliminate transportation factors in the final rule. Because of the more important aspects of the final rule and our desire to have consistency with the Indian gas valuation rule, ONRR has decided to pursue this issue in a future rulemaking for both Indian oil and gas production.

Public Comment: ONRR received three opposing comments from industry groups and one supporting comment from a Tribe in response to its request for comments on removing the provision under 30 CFR 1206.56(b)(2) that allows lessees to request an exception of the 50-percent limitation on transportation allowances.

ONRR Response: The final rule retains a lessee's ability to request approval to exceed the 50-percent limitation on transportation allowances. Under the current rule and the final rule, ONRR has the authority to review each and every request to ensure that the exception still represents a lessee's reasonable, actual, and necessary transportation costs. To date, ONRR has yet to receive a request for a transportation allowance to exceed 50 percent of the value of the Indian oil production. At this time, ONRR does not anticipate it will begin to receive such requests. Should ONRR receive a request to exceed, however, the Agency will review the request and all data involved, then we will consult with the Indian lessor before deciding to allow the lessee to exceed 50 percent. ONRR believes that these controls satisfy its trust responsibility to the Indian lessor.

ONRR did not receive comments specific to 30 CFR part 1210.

Under the proposed rule, ONRR stated, “for every month following the first full production month after this rule is effective, ONRR will monitor the LCTD using data reported on the Form ONRR-2014 for the previous month.” ONRR discovered, however, that, because companies can report on estimates, significant volumes of Indian oil sales are not reported by the last day of the month following the month of production. ONRR allows lessees to make a one-time estimate of their monthly royalty obligation in order to report and pay future royalties two months following the month of production. ONRR monitors a lessee's monthly reporting to ensure that the estimate on file with ONRR is sufficient, and, if it is not, then ONRR bills the lessee for late payment interest for the amount of the estimate that is insufficient.

Because of these estimates, many lessees do not report a large volume of Indian oil sales by the last day of the month following the month of production, ONRR is modifying the rule to use data from two months prior to the production month to monitor whether we will adjust the LCTD. This change will ensure that the data that ONRR uses to adjust the LCTD captures the majority of oil sales for that particular production month. Because ONRR will require the sales data from two months prior to the production month, ONRR will not make any adjustments to the LCTD for the first two production months after the rule is in effect.

We estimated the costs and benefits that this rulemaking may have on all potentially affected groups: Industry, Indian Lessors, and the Federal government. This amendment will result in an estimated annual increase in royalty collections of between $19.4 million and $20.6 million for ONRR to disburse to Indian lessors. This net impact represents a minimal increase of between 3.82 percent and 3.93 percent of the total Indian oil royalties that ONRR collected in 2012. We also estimate that Industry and the Federal government will experience one-time increased system costs of approximately $4.84 million and $247 thousand, respectively.

The table below lists ONRR's low, mid-range, and high estimates of the additional royalty costs that Industry will incur in the first year (excluding one-time system costs). Industry will incur these costs in the same amount each year thereafter.

As discussed above, the final rule contains a provision under 30 CFR 1206.54 that explains how a lessee must meet its obligation to value oil produced from Indian leases based on the highest price paid for a major portion of like-quality oil from the field. This rule defines the monthly IBMP value that a lessee must compare to its gross proceeds and pay on the higher of those two values.

To perform this economic analysis, ONRR used royalty data that we collected for Indian oil (product code 01) for calendar year 2012. We chose calendar year 2012 because most data reported has gone through ONRR edits and lessees have made most of their adjustments. We did not distinguish crude oil type within each designated area because (1), based on our experience, crude oil type within each designated area is generally the same, and (2) lessees currently do not report crude oil type to ONRR.

We then segregated the data into the following 14 designated areas:

We first arrayed the monthly reported prices—net of transportation—from highest to lowest and then calculated the monthly major portion price as that price at which 25 percent plus 1 barrel (by volume) of the oil is sold (starting from the highest price). Next, we calculated the difference between the reported prices and the major portion price. For any price below the major portion price, we multiplied the price difference by the royalty volume to estimate additional royalties.

Lastly, we totaled all of the monthly additional royalties for each designated area and then totaled all of the areas to arrive at an additional average royalty amount of $20 million. This amount represents 3.70 percent of all Indian oil royalties collected in 2012, or, approximately, $0.558/bbl.

Of note, we did not use the LCTD in this analysis. The rule uses the LCTD to calculate the IBMP value, which keeps the gross proceeds volume near the 25th percentile, through monthly monitoring and adjustments to the LCTD. Rather, we used the actual monthly major portion price in our analysis. Because we used the actual monthly major portion price, we did not account for the potential +/− 3 percent volume variation adjustments that the rule would allow. Instead, we created a +/− 3 percent range of royalty impacts above and below the estimated additional royalties, reflected in the table above.

ONRR needs to know crude oil types to calculate and publish the IBMP value. Therefore, § 1210.61 requires a lessee to report crude oil types using new product codes on Form ONRR-2014. ONRR anticipates that a lessee will make computer system changes to add these new product codes to their automated reporting.

We identified 205 Indian payors (those reporting and paying royalties to ONRR) in 2012. Of those, ONRR identified 32 as large businesses and 173 as small businesses (based on the SBA definition of a small business having 500 employees or fewer). To more accurately reflect the Indian payor community—based on our experience, we reclassified the 173 small businesses into two categories: Medium and small companies. We defined a medium company as those companies with between 250 and 500 employees. We also defined small companies as those companies with 250 or fewer employees. We classified 58 companies as medium companies and 115 companies as small companies.

ONRR first identified the changes that we must make to our systems in order to accommodate the requirements (adding product codes and edits, changing and adding reports, and modifying Oil and Gas Operations Reports, Form ONRR-4054 (OGORs)) of this rule and then estimated the number of hours needed to make those changes. We then multiplied those hours by our estimated hourly cost (including contractors) to implement system changes. Some of the hours calculated for ONRR include costs that Industry would not incur, such as eCommerce updates, changes to the compliance management tool, and web publishing.

We used this same process for large businesses, reducing or eliminating the hours for some categories, but used the same hourly cost because most large companies employ system contractors similar to those ONRR employs and, therefore, would have similar system change costs.

We reduced the hours for the medium (200 hours) and small companies (100 hours) to reflect the fact that their systems are smaller and less complex. We also reduced the hourly rate for medium and small businesses to $100 and $75, respectively, reflecting lower contractor costs. The table below provides our estimate of system change costs for both ONRR and Industry.

The table below lists the overall estimated first year economic impact to Industry from the changes, based on the mid-range estimate of costs:

After the first year, we anticipate that the estimated cost to Industry will be approximately $20,000,000 each year, based on 2012 data.

The impact to Indian lessors will be a net overall increase in royalties as a result of this change. This royalty increase will equal the royalty increase from Industry, or $20 million.

The Federal Government will incur system costs to accommodate crude oil type reporting similar to Industry. As detailed above, ONRR estimates that it will take 1,050 hours to implement system changes related to this rule, equating to a total cost of $246,750.

This rule will have no impact on Federal royalties. We also believe that there will be no administrative cost increases to the Federal Government because administrative savings due to decreased audit and litigation costs will offset the additional work needed to monitor and adjust the LCTD and IBMP value.

In the table below, the negative values in the Industry column represent their estimated royalty and cost increases, while the positive values in the other columns represent the increase in Indian royalty receipts. For the purposes of this summary table, we assumed that the average for royalty increases is the midpoint of our range.

After the first year, this rule will cost industry approximately $20 million per year in additional royalties paid, and Indian lessors will increase their annual royalty receipts by approximately $20 million. The Federal Government will not incur any additional costs after the first year.

Executive Order (E.O.) 12866 provides that the Office of Information and Regulatory Affairs (OIRA) of the Office of Management and Budget (OMB) will review all significant rulemaking. OIRA has determined that this rule is not significant.

Executive Order 13563 reaffirms the principles of E.O. 12866, while calling for improvements in the nation's regulatory system to promote predictability, to reduce uncertainty, and to use the best, most innovative, and least burdensome tools for achieving regulatory ends. This executive order directs agencies to consider regulatory approaches that reduce burdens and maintain flexibility and freedom of choice for the public where these approaches are relevant, feasible, and consistent with regulatory objectives. E.O. 13563 emphasizes further that regulations must be based on the best available science and that the rulemaking process must allow for public participation and an open exchange of ideas. We have developed this rule in a manner consistent with these requirements.

The Department of the Interior (Department) certifies that this rule will not have a significant economic effect on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.).

This rule will affect lessees under Indian mineral leases (excluding Osage Indian leases in Oklahoma). Lessees of Federal and Indian mineral leases are generally companies classified under the North American Industry Classification System (NAICS) Code 211111, which includes companies that extract crude petroleum and natural gas. For this NAICS code classification, a small company is one with fewer than 500 employees. Approximately 205 different companies submit royalty and production reports from Indian leases to ONRR each month. In addition, approximately 32 companies are large businesses under the U.S. Small Business Administration definition because they have over 500 employees. The Department believes that the remaining 173 companies affected by this rule are small businesses.

As provided in 1A Industry of the Procedural Matters section, we believe that industry will incur a one-time cost to comply with this rule. On average, ONRR estimates that each small business will incur a one-time cost of between $7,500 and $20,000 to modify their systems to comply with this rule.

As we stated earlier, we believe, based on 2012 Indian oil sales, this rule will cost industry approximately $20 million dollars per year. Small businesses only accounted for 13.55 percent of the oil volumes sold in 2012. Applying that percentage to industry costs, ONRR estimates that the major portion provision will cost all small-business lessors approximately $2,710,000 per year. The amount will vary for each company depending on the volume of production that each small business produces and sells each year. We believe that reduced administrative costs, such as reduced accounting, auditing, and litigation expenses, will offset some of these costs.

In sum, we do not believe that this rule will result in a significant economic effect on a substantial number of small entities because (1) the initial one-time cost to a small business to modify its system will be between $7,500 and $20,000, and (2) this rule will cost the small businesses a collective total of $2,710,000 per year. Therefore, a Regulatory Flexibility Analysis will not be required, and, accordingly, a Small Entity Compliance Guide will not be required.

Your comments are important. The Small Business and Agriculture Regulatory Enforcement Ombudsman and ten Regional Fairness Boards receive comments from small businesses about Federal agency enforcement actions. The Ombudsman annually evaluates the enforcement activities and rates each agency's responsiveness to small business. If you wish to comment on the actions of ONRR, call 1-888-734-3247. You may comment to the Small Business Administration without fear of retaliation. Allegations of discrimination/retaliation filed with the Small Business Administration will be investigated for appropriate action.

This rulemaking is not a major rule under 5 U.S.C. 804(2), the Small Business Regulatory Enforcement Fairness Act. This rulemaking:

a. Does not have an annual effect on the economy of $100 million or more. The effect will be limited to a maximum estimated at $2,710,000, which equals the $20,000,000 yearly cost of this rule to industry at large multiplied by 13.55 percent (volumes sold attributable to small businesses).

b. Does not cause a major increase in costs or prices for consumers; individual industries; Federal, State, Indian, or local government agencies; or geographic regions.

c. Does not have significant adverse effects on competition, employment, investment, productivity, innovation, or the ability of United States-based enterprises to compete with foreign-based enterprises.

This rule does not impose an unfunded mandate on State, local, or Tribal governments or the private sector of more than $100 million per year. This rule does not have a significant or unique effect on State, local, or Tribal governments or the private sector. We are not required to provide a statement containing the information that the Unfunded Mandates Reform Act (2 U.S.C. 1501 et seq.) requires because this rule is not an unfunded mandate.

Under the criteria in section 2 of E.O. 12630, this rule does not have any significant takings implications. This rule will not impose conditions or limitations on the use of any private property. Therefore, this rule does not require a Takings Implication Assessment.

Under the criteria in section 1 of E.O. 13132, this rule does not have sufficient Federalism implications to warrant the preparation of a Federalism summary impact statement. This rule does not substantially and directly affect the relationship between the Federal and State governments. The management of Indian leases is the responsibility of the Secretary of the Interior, and ONRR distributes all of the royalties that it collects from Indian leases to Tribes and individual Indian mineral owners. Because this rule does not alter that relationship, this rule does not require a Federalism summary impact statement.

This rule complies with the requirements of E.O. 12988. Specifically, this rule:

a. Meets the criteria of section 3(a), which requires that we review all regulations to eliminate errors and ambiguity and write them to minimize litigation.

b. Meets the criteria of section 3(b)(2), which requires that we write all regulations in clear language using clear legal standards.

The Department strives to strengthen its government-to-government relationship with Indian Tribes through a commitment to consultation with Indian Tribes and recognition of their right to self-governance and Tribal sovereignty. Under the Department's consultation policy and the criteria in E.O. 13175, we evaluated this rule and determined that it has no Tribal implications that will impose substantial, direct compliance costs on Indian Tribal governments.

Prior to formally promulgating this rule and throughout this rulemaking, ONRR has consulted with Tribes and representatives of individual Indian mineral owners as collaborative partners. On December 1, 2011, the Secretary signed the charter of the Indian Oil Valuation Negotiated Rulemaking Committee (Committee) and authorized the Committee under the Federal Advisory Committee Act. Members of the Committee included the Shoshone and Arapaho Tribes, Land Owners Association (Fort Berthold), Navajo Nation, Oklahoma Indian Land/Mineral Owners of Associated Nations, Ute Indian Tribe, Jicarilla Apache Nation, Blackfeet Nation and individual Indian mineral owner associations. The Committee engaged in substantive discussions under the Department's consultation policy; engaging in negotiated rulemaking is an appropriate process to engage in Tribal consultation.

Also, under this consultation policy and Executive Order criteria with Indian Tribes and individual Indian mineral owners on all policy changes that may affect them, ONRR scheduled public meetings in five different locations for the purpose of consulting with Indian Tribes and individual Indian mineral owners and to obtain public comments from other interested parties.

ONRR held consultation sessions with Tribes and individual Indian mineral owners on October 29, 2013, at the Civic Center in New Town, North Dakota; November 6, 2013, at Ft. Washakie, Wyoming; December 14, 2013, at the Wes Watkins Technology Center at Wetumka, Oklahoma; March 19-20, 2014, at the Indian Pueblo Cultural Center in Albuquerque, New Mexico; and March 31, 2014, at the BIA Agency in Ft. Duchene, Utah.

This rule:

(1) Does not contain any new information collection requirements.

(2) Does not require a submission to the Office of Management and Budget (OMB) under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.).

This rule will modify § 1210.61 to require a lessee of Indian leases to report additional product codes for crude oil types on Form ONRR-2014. Currently, OMB approved a total of 239,937 burden hours for lessees to file their Forms ONRR-2014 under OMB Control Number 1012-0004. ONRR estimates that there will be no additional burden hours, beyond the initial hours that industry must incur in order to modify systems so as to accommodate this rule, to report the applicable crude oil type in the product code field.

This rule also changes the form filing requirements necessary to claim a transportation allowance for oil produced from Indian leases. Currently, OMB approved a total of 220 burden hours for lessees to file their Forms ONRR-4110 under OMB Control Number 1012-0002. ONRR estimates that there will be no additional burden hours because this rule will insignificantly reduce the burden hours associated with the Oil Transportation Allowance Report (Form ONRR-4110) under OMB Control Number 1012-0002. Rather than submitting estimated transportation cost information on the form and then following up with actual cost information at the end of the reporting cycle, the rule will require only responses with actual cost information. Also, under this rule, Indian lessees that have arm's-length transportation costs will no longer submit a Form ONRR-4110 to ONRR but will, instead, submit copies of the actual contracts to ONRR.

This rule does not constitute a major Federal action significantly affecting the quality of the human environment. We are not required to provide a detailed statement under the National Environmental Policy Act of 1969 (NEPA) because this rule qualifies for categorical exclusion under 43 CFR 46.210(c) and (i) and the DOI Departmental Manual, part 516, section 15.4.D: “(c) Routine financial transactions including such things as . . . audits, fees, bonds, and royalties . . . (i) Policies, directives, regulations, and guidelines: That are of an administrative, financial, legal, technical, or procedural nature.” We have also determined that this rule is not involved in any of the extraordinary circumstances listed in 43 CFR 46.215 that require further analysis under NEPA. The procedural changes resulting from the IBMP value would have no consequence on the physical environment. This rule does not alter, in any material way, natural resources exploration, production, or transportation.

This rule is not a significant energy action under the definition in E.O. 13211. and, therefore, a Statement of Energy Effects is not required.

For the reasons discussed in the preamble, ONRR amends 30 CFR parts 1206 and 1210 as follows:

The Blynman (SR 127) Bridge across the Annisquam River and Blynman Canal, mile 0.0, at Gloucester, Massachusetts, has a vertical clearance in the closed position of 8.2 feet at mean high water and 16 feet at mean low water. The existing bridge operating regulations are found at 33 CFR 117.586.

The owner of the bridge, Massachusetts Department of Transportation, requested a temporary deviation from the normal operating schedule to facilitate a public event, the Annual Saint Peter's Fiesta 5K Road Race.

Under this temporary deviation, the Blynman (SR 127) Bridge may remain in the closed position for thirty minutes between 6:15 p.m. and 6:45 p.m. on Thursday June 25, 2015.

The waterways are transited by commercial and seasonal recreational vessels of various sizes. There is an alternate route for vessel traffic around Cape Ann. Also, vessels that can pass under the closed draws during this closure may do so at all times.

The Coast Guard will inform the users of the waterways through our Local and Broadcast Notice to Mariners of the change in operating schedule for the bridge so that vessels can arrange their transits to minimize any impact caused by the temporary deviation.

In accordance with 33 CFR 117.35(e), the drawbridge must return to its regular operating schedule immediately at the end of the effective period of this temporary deviation. This deviation from the operating regulations is authorized under 33 CFR 117.35.

The Coast Guard is issuing this final rule without prior notice and opportunity to comment pursuant to authority under section 4(a) of the Administrative Procedure Act (APA) (5 U.S.C. 553(b)). This provision authorizes an agency to issue a rule without prior notice and opportunity to comment when the agency for good cause finds that those procedures are “impracticable, unnecessary, or contrary to the public interest.” Under 5 U.S.C. 553(b), the Coast Guard finds that good cause exists for not publishing a notice of proposed rulemaking (NPRM) with respect to this rule because the Wisconsin Central Railroad bridge, that once required draw operations in 33 CFR 117.1089, was removed from the waterway in 2012. Therefore, the regulation is no longer applicable and shall be removed from publication. It is unnecessary to publish an NPRM because this regulatory action does not purport to place any restrictions on mariners but rather removes a restriction that has no further use or value. Under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause exists for making this rule effective in less than 30 days after publication in the Federal Register. The bridge has been removed from the waterway for 3 years and this rule merely requires an administrative change to the Federal Register, in order to omit a regulatory requirement that is no longer applicable or necessary. The removal has already taken place and the removal of the regulation will not affect mariners currently operating on this waterway. Therefore, a delayed effective date is unnecessary.

The Wisconsin Central Railroad Bridge across the Manitowoc River, mile 0.91, was removed in 2012. It has come to the attention of the Coast Guard that the governing regulation for this drawbridge was never removed subsequent to the removal of the bridge. The elimination of this drawbridge necessitates the removal of the drawbridge operation regulation, 33 CFR 117.1089(b), that pertained to the former drawbridge.

The purpose of this rule is to remove the section of 33 CFR 117.1089 that refers to the Wisconsin Central Railroad Bridge at mile 0.91 from the Code of Federal Regulations since it governs a bridge that has been removed.

The Coast Guard is changing the regulation in 33 CFR 117.1089 by removing restrictions and the regulatory burden related to the draw operations for this bridge that is no longer in existence. This Final Rule seeks to update the Code of Federal Regulations by removing language that governs the operation of the Wisconsin Central Railroad Bridge, which in fact no longer exists. This change does not affect waterway or land traffic. This change does not affect nor does it alter the operating schedules in 33 CFR 117.1089 that governs the remaining active drawbridges on the Manitowoc River.

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

This rule is not a significant regulatory action under section 3(f) of Executive Order 12866, Regulatory Planning and Review, as supplemented by Executive Order 13563, Improving Regulation and Regulatory Review, and does not require an assessment of potential costs and benefits under section 6(a)(3) of Order 12866 or under section 1 of Executive Order 13563. The Office of Management and Budget has not reviewed it under those Orders.

The Coast Guard does not consider this rule to be “significant” under that Order because it is an administrative change and does not affect the way vessels operate on the waterway.

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

This rule will have no effect on small entities since this drawbridge has been removed and the regulation governing draw operations for this bridge is no longer applicable. There is no new restriction or regulation being imposed by this rule; therefore, the Coast Guard certifies under 5 U.S.C. 605(b) that this final rule will not have a significant economic impact on a substantial number of small entities.

This rule calls for no new collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).

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

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

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

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

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

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

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

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

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

We have analyzed this rule under Department of Homeland Security Management Directive 023-01 and Commandant Instruction M16475.lD, which guides the Coast Guard in complying with the National Environmental Policy Act of 1969 (NEPA) (42 U.S.C. 4321-4370f), and have concluded that this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. This rule involves removing 33 CFR 117.1089(b) from the regulations. This rule is categorically excluded, under figure 2-1, paragraph (32)(e), of the Instruction.

Under figure 2-1, paragraph (32)(e), of the Instruction, an environmental analysis checklist and a categorical exclusion determination are not required for this rule.

For the reasons discussed in the preamble, the Coast Guard amends 33 CFR part 117 as follows:

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

The Coast Guard is issuing this temporary final rule without prior notice and opportunity to comment pursuant to authority under section 4(a) of the Administrative Procedure Act (APA) (5 U.S.C. 553(b)). This provision authorizes an agency to issue a rule without prior notice and opportunity to comment when the agency for good cause finds that those procedures are “impracticable, unnecessary, or contrary to the public interest.” Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good cause exists for not publishing a notice of proposed rulemaking with respect to this rule because doing so would be impracticable and contrary to public interest. On April 22, 2015, the Coast Guard established a temporary safety zone to accommodate the transit of the floating construction platform, which was scheduled for April 19, 2015 (USCG-2015-0277). However, we recently learned that scheduled transit would be postponed to April 26, 2015. We did not know of this change and the final details for this event until there was insufficient time remaining before the event to publish an NPRM. Thus, delaying the effective date of this rule to wait for a comment period to run would be both impracticable and contrary to the public interest because it would inhibit the Coast Guard's ability to protect participants, spectators and vessels from the hazards associated with this operation, which are discussed further below.

Under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause exists for making this temporary rule effective less than 30 days after publication in the Federal Register for the same reasons discussed in the preceding paragraph, waiting for a 30 day notice period to run would be impracticable and contrary to the public interest.

The legal basis for this rule is the Coast Guard's authority to establish safety zones: 33 U.S.C. 1231; 33 CFR 1.05-1, 160.5; Department of Homeland Security Delegation No. 0170.1.

On April 26, 2015, or alternatively on a later date on or prior to May 9, 2015, a floating construction platform will transit up the South Branch of the Chicago River, Chicago, Illinois from the Canal Street Bridge to the Lake Street Bridge. The Captain of the Port Lake Michigan has determined that the transit of the floating construction platform poses a significant risk to public safety and property. Such hazards include limited maneuverability and restricted visibility associated with the transit of a floating construction platform.

With the aforementioned hazards in mind, the Captain of the Port, Lake Michigan, has determined that this temporary safety zone is necessary to ensure the safety of vessels during the transit of the floating construction platform on the South Branch of the Chicago River. This rule was enforced from 5:00 a.m. to 12:00 p.m. on April 26, 2015. However, enforcement may occur on a later date within this effective period due to an unanticipated delay. In the event of a postponement, advanced notice of the enforcement time will be provided through Broadcast Notice to Mariners. The safety zone will encompass all waters of South Branch of the Chicago River, Chicago, IL, from the Canal Street Bridge to the Lake Street Bridge.

Entry into, transiting, or anchoring within the safety zone is prohibited unless authorized by the Captain of the Port Lake Michigan or a designated on-scene representative. The Captain of the Port or a designated on-scene representative may be contacted via VHF Channel 16.

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

This rule is not a significant regulatory action under section 3(f) of Executive Order 12866, Regulatory Planning and Review, as supplemented by Executive Order 13563, Improving Regulation and Regulatory Review, and does not require an assessment of potential costs and benefits under section 6(a)(3) of Executive Order 12866 or under section 1 of Executive Order 13563. The Office of Management and Budget has not reviewed it under those Orders.

We conclude that this rule is not a significant regulatory action because we anticipate that it will have minimal impact on the economy, will not interfere with other agencies, will not adversely alter the budget of any grant or loan recipients, and will not raise any novel legal or policy issues. The safety zone created by this rule will only impact a small area of the Chicago River and will be enforced for an estimated period of seven hours on one day between April 25, 2015 and May 9, 2015. Under certain conditions, moreover, vessels may still transit through the safety zone when permitted by the Captain of the Port or a designated on-scene representative.

Under the Regulatory Flexibility Act (5 U.S.C. 601-612), we have considered the impact of this temporary rule on small entities. The Coast Guard certifies under 5 U.S.C. 605(b) that this rule will not have a significant economic impact on a substantial number of small entities.

This rule will affect the following entities, some of which might be small entities: the owners or operators of vessels intending to transit or anchor in the affected portion of the South Branch of the Chicago River between 5:00 a.m. and 12:00 p.m. on April 26, 2015, or alternatively on a later date.

This safety zone will not have a significant economic impact on a substantial number of small entities for the reasons cited in the Regulatory Planning and Review section. Additionally, before the enforcement of the zone, we would issue local Broadcast Notice to Mariners so vessel owners and operators can plan accordingly.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

The HCHV program is authorized by section 2031 of title 38, United States Code (U.S.C.), under which VA may provide to eligible veterans outreach; care, treatment, and rehabilitative services (directly or by contract in community-based treatment facilities, including halfway houses); and therapeutic transitional housing assistance, under 38 U.S.C. 2032, in conjunction with work therapy under 38 U.S.C. 1718(a)-(b). Under current regulations, only veterans who are homeless, enrolled in the VA health care system or eligible for VA health care under title 38, Code of Federal Regulations (CFR), § 17.36 or 17.37, and have a serious mental illness and/or substance use disorder are eligible for the program. 38 CFR 63.3(a).

In a document published in the Federal Register on May 15, 2014 (79 FR 27826), VA proposed to amend part 63 of 38 CFR to remove the requirement that homeless veterans must suffer from a serious mental illness or substance use disorder to be eligible for HCHV, to modify the definition of the term “homeless” to match in part the definition used by HUD, and to require HCHV providers to offer case management services to homeless veterans, as appropriate. We provided a 60-day comment period, which ended on July 14, 2014. We received seven comments, all of which supported the proposed changes to part 63.

One commenter stated that it is shameful that homeless veterans have to be diagnosed with an illness before they can receive the benefits they have earned through military service. Before the enactment of Public Law 112-154, § 302, 126 Stat. 1164, 1184 (Aug. 6, 2012), VA only had authority to provide HCHV services to veterans with serious mental illness, including veterans who are homeless. As amended, the law authorizes VA to make services under the HCHV program available to all homeless veterans VA provides care and services to, regardless of whether they have a serious mental illness. VA fully supports the change in law, and agrees with the commenter that benefits for homeless veterans provided through the HCHV program should not be predicated on a diagnosis of serious mental illness. This regulation will remove that requirement, thereby allowing all eligible homeless veterans to receive services. VA is not making a change based on this comment.

Another commenter asked VA to make the changes in the proposed rule, stating that homeless veterans should be provided resources through the HCHV program regardless of whether or not they have a mental illness. Another commenter stated her wholehearted support for the proposed amendment. Another commenter stated the proposed changes need to be passed. We appreciate the commenters taking the time to review this rulemaking.

Another commenter expressed support for the rule and noted that the proposed change could reduce the social stigma many homeless veterans who do not suffer from a serious mental illness feel about seeking assistance to address their homelessness. Another commenter noted that removing the requirement of a diagnosis for mental illness would also help homeless veterans with serious mental illness access the program, as they may not have been willing to acknowledge their disability before. We agree and believe that these changes will help more homeless veterans, both those with and without a serious mental illness, access the health care services they need through the HCHV program.

One commenter expressed support for the proposed changes, but identified two concerns. First, the commenter urged VA to request increased funding and resources to accommodate the number of new enrollees that would be eligible as a result of the proposed rule. Second, the commenter stated their concern that the proposed rule could have the unintended effect of disadvantaging homeless veterans with a serious mental illness if HCHV providers find that veterans without a mental illness are easier to place or receive the bulk of the services available. While the first comment is somewhat outside the scope of this rule, VA will take into account the changes made as a result of this rule when determining the resources it will allocate for the HCHV program. However, VA notes that the rule should not result in any increased expense to the Department, as it only modifies the pool of eligible persons, rather than the number of persons served. As explained in the proposed rule, the principal driver of costs is bed availability, which would not change as a result of this rule. Similarly, and also in response to the second comment, VA has found that the supply of HCHV services generally exceeds demand, so we do not believe there will be a shift in emphasis or a reduction in services from homeless veterans with a serious mental illness. Further, the HCHV provider would be prohibited from engaging in discrimination by virtue of entering into a contract with VA as a recipient of Federal financial assistance. Pursuant to 38 CFR 63.10(a)-(b), HCHV providers must enter into a contract with VA in order to be granted financial assistance. VA is authorized by section 504 of the Rehabilitation Act of 1973 (29 U.S.C. 706, 794) and VA's implementing regulations in subpart D, part 18, 38 CFR to prohibit discrimination against persons on the basis of handicap by any party that receives Federal financial assistance. Under these authorities, any HCHV provider is prohibited from discriminating against beneficiaries on the basis of a disability, including a serious mental illness.

Based on the rationale set forth in the proposed rule and in this document, VA is adopting the proposed rule as a final rule with no changes.

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

This final rule contains no provisions constituting a collection of information under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3521).

The Secretary hereby certifies that this final rule will not have a significant economic impact on a substantial number of small entities as they are defined in the Regulatory Flexibility Act, 5 U.S.C. 601-612. This rule removes the requirement that veterans have a serious mental illness to participate in the HCHV program and clarifies that the HCHV program includes case management services. This rule only impacts those entities that choose to participate in the HCHV program. As of June 2014, approximately 300 non-profit entities participate in the HCHV program. We do not expect this rule to result in any additional costs or economic impacts on these entities, as the rule modestly expands the population of veterans eligible to receive care and requires case management services consistent with current practice. Small entity applicants will not be affected to a greater extent than large entity applicants. Small entities must elect to participate, and this clarification simply reinforces the services these entities are already providing. The expanded population of eligible veterans will not result in any additional costs because the principal driver of cost is bed availability, which will not change as a result of this rule. To the extent this rule will have any impact on small entities, it will not have an impact on a substantial number of small entities. Therefore, pursuant to 5 U.S.C. 605(b), this rulemaking is exempt from the initial and final regulatory flexibility analysis requirements of 5 U.S.C. 603 and 604.

Executive Orders 12866 and 13563 direct agencies to assess the costs and benefits of available regulatory alternatives and, when regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, and other advantages; distributive impacts; and equity). Executive Order 13563 (Improving Regulation and Regulatory Review) emphasizes the importance of quantifying both costs and benefits, reducing costs, harmonizing rules, and promoting flexibility. Executive Order 12866 (Regulatory Planning and Review) defines a “significant regulatory action,” requiring review by the Office of Management and Budget (OMB), unless OMB waives such review, as “any regulatory action that is likely to result in a rule that may: (1) Have an annual effect on the economy of $100 million or more or adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or tribal governments or communities; (2) Create a serious inconsistency or otherwise interfere with an action taken or planned by another agency; (3) Materially alter the budgetary impact of entitlements, grants, user fees, or loan programs or the rights and obligations of recipients thereof; or (4) Raise novel legal or policy issues arising out of legal mandates, the President's priorities, or the principles set forth in this Executive Order.”

The economic, interagency, budgetary, legal, and policy implications of this final rule have been examined, and it has been determined not to be a significant regulatory action under Executive Order 12866. VA's impact analysis can be found as a supporting document at http://www.regulations.gov, usually within 48 hours after the rulemaking document is published. Additionally, a copy of the rulemaking and its impact analysis are available on VA's Web site at http://www.va.gov/orpm, by following the link for VA Regulations Published from FY 2004 through FYTD.

The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C. 1532, that agencies prepare an assessment of anticipated costs and benefits before issuing any rule that may result in the expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more (adjusted annually for inflation) in any one year. This final rule will have no such effect on State, local, and tribal governments, or on the private sector.

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

The Secretary of Veterans Affairs, or designee, approved this document and authorized the undersigned to sign and submit the document to the Office of the Federal Register for publication electronically as an official document of the Department of Veterans Affairs. Jose D. Riojas, Chief of Staff, Department of Veterans Affairs, approved this document on April 24, 2015, for publication.

For the reasons set forth in the preamble, VA amends 38 CFR part 63 as follows:

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

On February 17, 2015 (80 FR 8250), EPA proposed approval of South Coast Air Quality Management District (SCAQMD) Rule 1325, Federal PM2.5 New Source Review Program, for inclusion in the California SIP. Rule 1325 was adopted by SCAQMD on December 5, 2014, and submitted by the California Air Resources Board on December 29, 2014.

EPA's proposed action provided a 30-day public comment period. During this time we received two comments. Only one of the comments, submitted by Earthjustice on behalf of Health Advocates 1 , objected to our proposed approval of SCAQMD Rule 1325.

The letter submitted on behalf of Health Advocates objected to EPA's proposed approval of Rule 1325 on three grounds. Below we provide a summary of our response to each of Health Advocates' comments. Please see the Response to Comments document in the docket for this final action for our complete response.

1. Approval of exclusion of ammonia as a precursor.

CAA subpart 4 includes section 189(e), which requires NNSR controls for major stationary sources of PM10 precursors, and hence PM2.5 precursors, “except where the Administrator determines that such sources do not contribute significantly to PM10 levels which exceed the standard in the area.” CAA section 189(e) (Emphasis added). EPA has identified ammonia as a precursor to the formation of PM2.5. See generally 80 FR 15340, 15352 (Mar, 23, 2015) (Proposed PM2.5 Implementation Rule). EPA proposed to approve Rule 1325 even though it does not contain NNSR requirements for ammonia emissions because SCAQMD provided information that demonstrates major stationary sources of ammonia emissions do not contribute significantly to PM2.5 levels exceeding the PM2.5 National Ambient Air Quality Standard (NAAQS) in the South Coast Air Basin nonattainment area. 80 FR at 8251.

Health Advocates disagreed with our proposal on three grounds, asserting that (1) EPA's determination that a contribution of 1.7 tons per day (tpd) of ammonia emissions to the ammonia inventory is small is “unjustified”; (2) EPA has not demonstrated that ammonia emissions do not contribute significantly to PM2.5 NAAQS violations in the South Coast Air Basin; and (3) it was arbitrary and capricious for EPA to consider the trends and actual air quality of PM2.5 in the area. Earthjustice Letter at p.3.

EPA disagrees with these comments. EPA applied a weight of the evidence approach taking into account several factors to determine if SCAQMD appropriately determined that major stationary sources of ammonia emissions do not contribute significantly to PM2.5 nonattainment in the area.

One factor we considered is that there are only four existing major stationary sources of ammonia and these four sources' emissions are only a small percentage (1.7%) of the total ammonia inventory for the South Coast PM2.5 nonattainment area. Health Advocates did not submit any information or provide an explanation to show that 1.7% is not a small percentage. Health Advocates did not indicate what percentage would be justified as being small. For reasons explained fully in our Response to Comments, EPA continues to consider the 1.7% contribution of ammonia emissions from the four existing stationary sources to be relatively small compared to the rest of the ammonia inventory.

A second factor we considered is whether major stationary sources of ammonia contribute significantly to levels exceeding the PM2.5 NAAQS in the area, and whether potential new major stationary sources would be expected to contribute significantly to levels exceeding the PM2.5 NAAQS in the area. The SCAQMD provided information showing that a regional increase of 10 tpd of ammonia (more than five times the amount currently emitted by all major stationary sources) would result in a 0.22 microgram per cubic meter (μg/m3) increase in annual PM2.5 concentrations. This estimated increase in annual PM2.5 concentration would be 1.5% of the 15 μg/m3 1997 PM2.5 annual standard. SCAQMD submitted additional information showing that decreasing ammonia emissions by 2.9 tpd near the Mira Loma monitor would result in a reduction of 0.16 μg/m3 at that monitor.2 This estimated increase in 24-hr PM2.5 concentration would be 0.46% of the 35 μg/m3 1997 PM2.5 24-hr standard. Based on these data, one can reasonably conclude that the current ambient contribution (in μg/m3) of the four existing major stationary sources (with emissions of 1.7 tpd) and the ambient contributions from a new major source, to PM2.5 levels that exceed the standard are likely to be less than the estimated changes in PM2.5 concentrations indicated in the analyses cited above (which evaluated emission changes of 10 tpd and 2.9 tpd, respectively). Thus, EPA determined that existing and new major stationary sources of ammonia would make a relatively minor contribution to levels exceeding the 1997 or 2006 PM2.5 NAAQS in the area.

A third factor we considered was the progress the SCAQMD has made and the overall severity of the PM2.5 nonattainment problem in the South Coast Air Basin. Health Advocates contends it was arbitrary and capricious to consider the past progress and current air quality and asserts that our evaluation of the air quality is flawed. We disagree with both points. EPA's General Preamble in 1992 noted that determinations under CAA section 189(e) are case-by-case and depend on a variety of information that is specific to the area. See 57 FR 13498, 13538-42 (April 16, 1992). EPA's proposed PM2.5 Implementation Rule recently reiterated that application of section 189(e) should be case-specific and focused on location, including a weight of the evidence approach considering, among other factors, the severity of the nonattainment problem in the area. 80 FR at 15359. Therefore, it is appropriate to consider this factor.

Health Advocates also asserted that EPA's discussion of the air quality in the South Coast Air Basin was misleading, contending that there were violations of both the 1997 and 2006 PM2.5 NAAQS. Earthjustice Letter at p. 3-4. EPA acknowledges one monitor (Mira Loma) has recorded PM2.5 emissions exceeding the level of the 2006 24-hour PM2.5 NAAQS based on 2011-2013 air quality data. However, Health Advocates failed to provide any information to support its claims that there are any current violations of the 1997 PM2.5 NAAQS. The information Health Advocates cited to support its allegations of additional violations of the 2006 PM2.5 NAAQS at the Mira Loma monitor is from a combination of both federal and non-federal reference method monitors. In in addition the data is preliminary, uncertified and has not been quality assured.

Based on the weight of the evidence, EPA concludes that it was appropriate for SCAQMD to exclude ammonia as a precursor pursuant to CAA section 189(e).

2. Regulation of VOCs by SCAQMD NNSR Rule 1303 rather than Rule 1325.

Health Advocates also disagreed with EPA's proposal to approve Rule 1325 without requiring VOC emissions to be included in the Rule's requirements. Id at p. 4. Health Advocates contends our proposal is inconsistent with CAA section 189(e).

EPA did not propose to determine that VOCs do not contribute significantly to PM2.5 levels that exceed the PM2.5 standards and is making no such finding in this final rule. Instead, consistent with the proposed rule, EPA is determining that the NNSR control requirements applicable under the SCAQMD SIP for major stationary sources of PM2.5 also apply to major stationary sources of VOCs (which are PM2.5 precursors), because major VOC sources are currently subject to stringent NNSR control requirements under Rule 1303. The requirements in Rule 1303 3 are more stringent than those that would apply under Rule 1325 and fully satisfy the control requirements of CAA section 189(e) with respect to VOCs.4 Moreover, it is long-standing EPA policy to allow NNSR regulation of PM precursors via their regulation through other NNSR programs. 57 FR at 13542 (“The VOC reductions may also be realized from new or modified major stationary sources due to the implementation of NSR programs in ozone nonattainment or attainment areas”).

We continue to find that the NNSR regulation of VOC emissions pursuant to Rule 1303 rather than Rule 1325 satisfies the requirements of section 189(e).

3. Consideration of attainment of the PM2.5 NAAQS.

Finally, Health Advocates contends that EPA cannot approve Rule 1325 because the South Coast Air Basin has not demonstrated the area is in attainment with the 1997 and 2006 PM2.5 NAAQS. Earthjustice Letter at p. 5.

There is no requirement for the area to have attained the PM2.5 NAAQS as a predicate for EPA to approve a new NNSR rule for PM2.5. Approval of a new NNSR rule to control emissions of PM2.5, including NOX, SO2 and VOCs 5 emissions as precursors, in no way interferes with the SCAQMD's progress towards attaining the 1997 and 2006 PM2.5 NAAQS.

No comments were submitted to change our assessment of Rule 1325 as described in our proposed action. Pursuant to section 110(k) of the CAA and for the reasons provided in our proposed action, associated TSD and detailed Response to Comments document included in the docket, EPA is finalizing approval of SCAQMD Rule 1325.

In this rule, the EPA is finalizing regulatory text that includes incorporation by reference. In accordance with requirements of 1 CFR 51.5, the EPA is finalizing the incorporation by reference of the SCAQMD rules described in the amendments to 40 CFR 52.220 set forth below. The EPA has made, and will continue to make, these documents available electronically through www.regulations.gov and in hard copy at the appropriate EPA office (see the ADDRESSES section of this preamble for more information).

Under the Clean Air Act, 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 Clean Air Act. 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 Clean Air Act; 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 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 Clean Air Act, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by June 30, 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).)

Part 52, chapter I, title 40 of the Code of Federal Regulations is amended as follows:

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).

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

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-2014-0248 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 June 30, 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-2014-0248, 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.

In the Federal Register of May 23, 2014 (79 FR 29729) (FRL-9910-29), 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 3E8228) by Syngenta Crop Protection, LLC, P.O. Box 18300, Greensboro, NC 27419. The petition requested that 40 CFR part 180 be amended by establishing tolerances for residues of the fungicide azoxystrobin, in or on coffee, bean, green at 0.03 parts per million (ppm); pear, Asian at 0.07 ppm and tea at 10 ppm. That document referenced a summary of the petition prepared by Syngenta Crop Protection, LLC, the petitioner, which is available in the docket, http://www.regulations.gov. A comment was received on the notice of filing. EPA's response to this comment is discussed in Unit IV.C.

Based upon review of the data supporting the petition, EPA has increased the tolerance on tea from what the petitioner requested. The reason for this change is explained in Unit IV.D.

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

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

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

Azoxystrobin has low acute toxicity via the oral, dermal, and inhalation routes of exposure. It is not an eye or skin irritant and is not a skin sensitizer. Repeated oral dosing of azoxystrobin to rats resulted in decreased body weights, decreased food intake and utilization, increased diarrhea, and other clinical toxicity observations (increased urinary incontinence, hunched postures, and distended abdomens). In addition, liver effects characterized by increased liver weights, increase in alkaline phosphatase and gamma glutamyltransferase, decrease in albumin, and gross and histological lesions in the liver and bile ducts, were seen in rats. In dogs, effects on liver/biliary function were found after oral administration.

In the acute neurotoxicity study in rats, increased incidence of diarrhea was observed at all dose levels tested. Decreases in body weight and food utilization were noted in the rat subchronic neurotoxicity study. There were no indications of treatment-related neurotoxicity in either the acute or subchronic neurotoxicity studies.

In the rat developmental toxicity study, diarrhea, urinary incontinence, and salivation were observed in maternal animals; in the rabbit developmental toxicity study, maternal animals exhibited decreased body weight gain. No adverse treatment-related developmental effects were seen in either study. In the rat reproduction study, offspring and parental effects (decreased body weights and increased adjusted liver weights) were observed at the same dose.

There was no evidence of carcinogenicity in rats and mice. As a result, EPA has classified azoxystrobin as “not likely to be carcinogenic to humans.” Azoxystrobin induced a weak mutagenic response in the mouse lymphoma assay, but the activity expressed in vitro is not expected to be expressed in whole animals.

Specific information on the studies received and the nature of the adverse effects caused by azoxystrobin 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 “Human Health Aggregate Risk Assessment for Permanent Tolerances on Imported Asian Pear, Imported Tea, and Imported Coffee; Establishment of Permanent Tolerances on Ti Palm and for Crop Group Conversions for Stone Fruits Group 12-12 and Tree Nut Group 14-12 Crop Groups” on page 5 in docket ID number EPA-HQ-OPP-2014-0248.

Once a pesticide's toxicological profile is determined, EPA identifies toxicological points of departure (POD) and levels of concern to use in evaluating the risk posed by human exposure to the pesticide. For hazards that have a threshold below which there is no appreciable risk, the toxicological POD is used as the basis for derivation of reference values for risk assessment. PODs are developed based on a careful analysis of the doses in each toxicological study to determine the dose at which no adverse effects are observed (the NOAEL) and the lowest dose at which adverse effects of concern are identified (the LOAEL). Uncertainty/safety factors are used in conjunction with the POD to calculate a safe exposure level—generally referred to as a population-adjusted dose (PAD) or a reference dose (RfD)—and a safe margin of exposure (MOE). For non-threshold risks, the Agency assumes that any amount of exposure will lead to some degree of risk. Thus, the Agency estimates risk in terms of the probability of an occurrence of the adverse effect expected in a lifetime. For more information on the general principles 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 azoxystrobin used for human risk assessment is shown in Table 1 of this unit.

1. Dietary exposure from food and feed uses. In evaluating dietary exposure to azoxystrobin, EPA considered exposure under the petitioned-for tolerances as well as all existing azoxystrobin tolerances in 40 CFR 180.507. EPA assessed dietary exposures from azoxystrobin 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 azoxystrobin. 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, the acute dietary assessment incorporated tolerance-level residues for all commodities except for citrus fruits (which used the highest residues from residue trials); 100 percent crop treated (PCT); and Dietary Exposure Evaluation Model (DEEM) (ver. 3.16) default processing factors, except for where tolerances were established for processed commodities or when processing studies showed no concentration. Field trial data were translated from the representative commodities to the non-representative commodities according to HED SOP 2000.1“Guidance for Translation of Field Trial Data from Representative Commodities in the Crop Group Regulation to other Commodities in Each Crop Group/Subgroup.”

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 to residue levels in food, the chronic dietary analysis incorporated tolerance-level residues for all commodities, average PCT estimates when available and DEEM (ver. 3.16) default processing factors, except for where tolerances were established for processed commodities or when processing studies showed no concentration.

iii. Cancer. Based on the data summarized in Unit III.A., EPA has concluded that azoxystrobin should be classified as “not likely” to be carcinogenic to humans. Therefore a cancer risk assessment is unnecessary.

iv. Anticipated residue and percent crop treated (PCT) information. Section 408(b)(2)(E) of FFDCA authorizes EPA to use available data and information on the anticipated residue levels of pesticide residues in food and the actual levels of pesticide residues that have been measured in food. If EPA relies on such information, EPA must require pursuant to FFDCA section 408(f)(1) that data be provided 5 years after the tolerance is established, modified, or left in effect, demonstrating that the levels in food are not above the levels anticipated. For the present action, EPA will issue such data call-ins as are required by FFDCA section 408(b)(2)(E) and authorized under FFDCA section 408(f)(1). Data will be required to be submitted no later than 5 years from the date of issuance of these tolerances.

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

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

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

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

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

The Agency estimated the PCT for the chronic dietary exposure assessment for existing uses as follows: Almonds, 20%; apricots, 10%; artichokes, 20%; asparagus, <2.5%; barley, <2.5%; green beans, 15%; blueberries, 15%; broccoli, 10%; cabbage, 10%; cane berries, 5%; cantaloupes, 20%; carrots, 10%; cauliflower, <2.5%; celery, 10%; corn, <2.5%; cotton, <2.5%; cotton (seed treatment), 25%; cucumbers, 20%; dry beans/peas, <2.5%; eggplant, 30%; garlic, 70%; grapefruit, 20%; grapes, 5%; hazelnuts, 5%; lemons, <2.5%; lettuce, <2.5%; nectarines, <2.5%; onions, 5%; oranges, 5%; peaches, 5%; peanuts, 20%; peanuts (seed treatment), 30%; green peas, <2.5%; pecans, 5%; peppers, 20%; pistachios, 5%; plums/prunes, <2.5%; potatoes, 40%; potatoes (seed treatment), <1%; pumpkins, 20%; rice, 40%; soybeans, 5%; soybeans (seed treatment), <1%; spinach, 10%; squash, 20%; strawberries, 25%; sugar beets, 10%; sugar beets (seed treatment), <2.5%; sweet corn, 15%; tangelos, 25%; tangerines, 10%; tobacco, 15%; tomatoes, 25%; walnuts, >2.5%; watermelons, 15%; wheat, 5%; wheat seed (seed treatment), <1%.

In most cases, EPA uses available data from USDA/National Agricultural Statistics Service (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 1%. 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 azoxystrobin 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 azoxystrobin in drinking water. These simulation models take into account data on the physical, chemical, and fate/transport characteristics of azoxystrobin. 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 Screening Concentration in Ground Water (SCI-GROW) model and Pesticide Root Zone Model Ground Water (PRZM GW), for surface water, the estimated drinking water concentrations (EDWCs) of azoxystrobin for acute exposures are estimated to be 70.2 parts per billion (ppb) and for chronic exposures are estimated to be 48.5 ppb. For ground water, the estimated drinking water concentration for both acute and chronic exposure scenarios is 3.1 ppb.

Modeled estimates of drinking water concentrations were directly entered into the dietary exposure model. For acute dietary risk assessment, the water concentration value of 70.2 ppb was used to assess the contribution to drinking water. For chronic dietary risk assessment, the water concentration of value 48.5 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). Azoxystrobin is currently registered for the following uses that could result in residential exposures: Outdoor residential (lawns, ornamentals, flower gardens, vegetables, fruit and nut trees, berries and vines) and recreational (golf courses, parks and athletic fields) sites. Additionally, it is registered for use on indoor carpets/other surfaces by non-commercial applicators, and in treated paints (preservative incorporation).

The proposed uses do not impact the aggregate risk assessment; however, the scenarios that do impact the aggregate assessment have been re-evaluated in this assessment to reflect the revised incidental oral and inhalation PODs. Using those new PODs, EPA assessed residential exposure using the 2012 updated residential standard operating procedures (SOPs) that are now used in all human health assessments.

For the adult aggregate assessment, the Agency used inhalation exposure from adult handlers applying treated paint via airless sprayers; for the aggregate assessment for children, the Agency used post-application inhalation exposure from space-trays and hand-to-mouth exposures from indoor applications to treated carpets for children 1 to <2 years old.

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 azoxystrobin to share a common mechanism of toxicity with any other substances, and azoxystrobin does not appear to produce a toxic metabolite produced by other substances. For the purposes of this tolerance action, therefore, EPA has assumed that azoxystrobin 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 athttp://www.epa.gov/pesticides/cumulative.

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 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 prenatal and postnatal toxicity database for azoxystrobin includes prenatal developmental toxicity studies in rats and rabbits and a 2-generation reproduction study in young rats. In these studies, there is no evidence that azoxystrobin results in increased quantitative sensitivity to developing fetuses. Also in the reproduction study, the offspring and the parental effects occurred at the same dose level.

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 exposure scenarios except acute exposure. For assessing acute dietary risk, EPA is retaining an FQPA factor of 3X to account for the use of a LOAEL from the acute neurotoxicity study to derive an acute reference dose. The Agency believes that a 3X FQPA SF (as opposed to a 10X) will be adequate to extrapolate a NOAEL in assessing acute risk based on the following considerations:

• The LOAEL is based on a transient effect (diarrhea in rats) expected to be relatively insignificant in nature. This effect is also seen in other chemicals of the same class.

• The diarrhea was only seen in studies using gavage dosing in the rat, but not in studies using repeat dosing through dietary administration in rats or mice, and not through gavage dosing in rabbits.

• The very high dose level needed to reach the acute oral lethal dose (LD)50(>5000 mg/kg), and the overall low toxicity of azoxystrobin.

The decision to reduce the FQPA safety factor to 1X for the assessment of the remaining exposure scenarios is based on the following findings:

i. The toxicity database for azoxystrobin is complete.

ii. There is no indication that azoxystrobin is a neurotoxic chemical. Although clinical signs were observed in the acute and subchronic neurotoxicity studies which included transient diarrhea, decreased body weight, body weight gain, and food utilization, no other effects were seen in those studies that would be considered indicative of neurotoxicity. Therefore, there is no need for a developmental neurotoxicity study or additional UFs to account for neurotoxicity.

iii. There is no evidence that azoxystrobin 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. In the reproduction study, the offspring and the parental effects occurred at the same dose level.

iv. There are no residual uncertainties identified in the exposure databases. The acute dietary (food) exposure assessments utilized conservative upper-bound inputs including assuming 100% CT and tolerance-level residues for all commodities except citrus fruits where the highest field trial residue was used as a refinement. The chronic dietary exposure assessment was partially refined, and used tolerance-level residues for all commodities and PCT information for selected crops. EPA made conservative (protective) assumptions in the ground and surface water modeling used to assess exposure to azoxystrobin in drinking water. EPA used similarly conservative assumptions to assess post-application exposure of children as well as incidental oral exposure of toddlers. These assessments will not underestimate the exposure and risks posed by azoxystrobin.

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 azoxystrobin will occupy 40% of the aPAD for children 1-2 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 azoxystrobin from food and water will utilize 15% of the cPAD for children 1-2 years 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 azoxystrobin 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).

Azoxystrobin 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 azoxystrobin.

Using the exposure assumptions described in this unit for short-term exposures, EPA has concluded the combined short-term food, water, and residential exposures result in aggregate MOEs of 2,400 for adults and 280 for children 1-2 years old. Because EPA's level of concern for azoxystrobin 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).

Because no intermediate-term adverse effect was identified, azoxystrobin is not expected to pose an intermediate-term risk. Therefore, the intermediate-term aggregate risk would be equivalent to the chronic dietary exposure estimate.

5. Aggregate cancer risk for U.S. population. Based on the lack of evidence of carcinogenicity in two adequate rodent carcinogenicity studies, azoxystrobin 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 azoxystrobin residues.

Adequate enforcement methodology (gas chromatography with a nitrogen-phosphorus detector (GC/NPD) method, RAM 243/04) is available to enforce the tolerance expression for residues of azoxystrobin and its Z-isomer in crop commodities. This method (designated RAM 243, dated 5/15/98) has been submitted to FDA for inclusion in the Pesticide Analytical Manual (PAM), Volume II.

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]

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

The Codex has established a MRL for azoxystrobin in or on coffee, bean at 0.03 ppm. The US tolerance for coffee is harmonized with the Codex MRL. The Codex has not established a MRL for Asian pear or tea.

One comment was received in response to the notice of filing of Syngenta Crop Protection's petition. The commenter objected to the increase of chemical residues generally and expressed additional concerns about the carcinogenic effects of chemicals in general on humans. The Agency understands the commenter's concerns regarding toxic chemicals and their potential effects on humans. Pursuant to its authority under the FFDCA, and as discussed further in this preamble, EPA conducted a comprehensive assessment of azoxystrobin, which included an assessment on the carcinogenic potential of azoxystrobin. Based on its assessment of the available data, the Agency has concluded that azoxystrobin is not likely to be a carcinogen and that there is a reasonable certainty that no harm will result from aggregate exposure to residues of azoxystrobin.

The tolerance on tea has been revised from what was proposed in the initial petition. EPA is increasing the proposed tolerance for tea from 10 ppm to 20.0 ppm. The proposed tolerance of 10 ppm for tea is insufficient, as the trials were conducted at 50% of the label maximum rate. Correction by proportionality to the maximum label rate provides a tolerance recommendation of 20.0 ppm. Also, because magnitude of residue data used to determine the appropriate tolerance level were provided for dried tea only, EPA is only establishing a tolerance for dried tea at this time.

In addition, EPA is altering the commodity name for “coffee, green bean” from the petitioned-for name (“coffee, bean, green”) to be consistent with the general food and feed commodity vocabulary EPA uses for tolerances and exemptions.

Therefore, tolerances are established for residues of azoxystrobin, in or on coffee, green bean at 0.03 ppm; pear, Asian at 0.07 ppm; and tea, dried at 20.0 ppm.

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).

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).

Therefore, 40 CFR chapter I is amended as follows:

The NFIP enables property owners to purchase Federal flood insurance that is not otherwise generally available from private insurers. In return, communities agree to adopt and administer local floodplain management measures aimed at protecting lives and new construction from future flooding. Section 1315 of the National Flood Insurance Act of 1968, as amended, 42 U.S.C. 4022, prohibits the sale of NFIP flood insurance unless an appropriate public body adopts adequate floodplain management measures with effective enforcement measures. The communities listed in this document no longer meet that statutory requirement for compliance with program regulations, 44 CFR part 59. Accordingly, the communities will be suspended on the effective date in the third column. As of that date, flood insurance will no longer be available in the community. We recognize that some of these communities may adopt and submit the required documentation of legally enforceable floodplain management measures after this rule is published but prior to the actual suspension date. These communities will not be suspended and will continue to be eligible for the sale of NFIP flood insurance. A notice withdrawing the suspension of such communities will be published in the Federal Register.

In addition, FEMA publishes a Flood Insurance Rate Map (FIRM) that identifies the Special Flood Hazard Areas (SFHAs) in these communities. The date of the FIRM, if one has been published, is indicated in the fourth column of the table. No direct Federal financial assistance (except assistance pursuant to the Robert T. Stafford Disaster Relief and Emergency Assistance Act not in connection with a flood) may be provided for construction or acquisition of buildings in identified SFHAs for communities not participating in the NFIP and identified for more than a year on FEMA's initial FIRM for the community as having flood-prone areas (section 202(a) of the Flood Disaster Protection Act of 1973, 42 U.S.C. 4106(a), as amended). This prohibition against certain types of Federal assistance becomes effective for the communities listed on the date shown in the last column. The Administrator finds that notice and public comment procedures under 5 U.S.C. 553(b), are impracticable and unnecessary because communities listed in this final rule have been adequately notified.

Each community receives 6-month, 90-day, and 30-day notification letters addressed to the Chief Executive Officer stating that the community will be suspended unless the required floodplain management measures are met prior to the effective suspension date. Since these notifications were made, this final rule may take effect within less than 30 days.

National Environmental Policy Act. This rule is categorically excluded from the requirements of 44 CFR part 10, Environmental Considerations. No environmental impact assessment has been prepared.

Regulatory Flexibility Act. The Administrator has determined that this rule is exempt from the requirements of the Regulatory Flexibility Act because the National Flood Insurance Act of 1968, as amended, Section 1315, 42 U.S.C. 4022, prohibits flood insurance coverage unless an appropriate public body adopts adequate floodplain management measures with effective enforcement measures. The communities listed no longer comply with the statutory requirements, and after the effective date, flood insurance will no longer be available in the communities unless remedial action takes place.

Regulatory Classification. This final rule is not a significant regulatory action under the criteria of section 3(f) of Executive Order 12866 of September 30, 1993, Regulatory Planning and Review, 58 FR 51735.

Executive Order 13132, Federalism. This rule involves no policies that have federalism implications under Executive Order 13132.

Executive Order 12988, Civil Justice Reform. This rule meets the applicable standards of Executive Order 12988.

Paperwork Reduction Act. This rule does not involve any collection of information for purposes of the Paperwork Reduction Act, 44 U.S.C. 3501 et seq.

Accordingly, 44 CFR part 64 is amended as follows:

NMFS and the Council manage the Gulf reef fish fishery, including red snapper, under the FMP. The Council prepared the FMP and NMFS implements the FMP through regulations at 50 CFR part 622 under the authority of the Magnuson-Stevens Fishery Conservation and Management Act (Magnuson-Stevens Act).

On April 1, 2015, NMFS published a proposed rule for the framework action and requested public comment (80 FR 17380). The proposed rule and the framework action set forth the rationale for the actions contained in this final rule. A summary of the actions implemented by this final rule is provided below.

This final rule sets the commercial and recreational quotas (equal to the commercial and recreational annual catch limit (ACLs)) and the recreational annual catch targets (ACTs) for the 2015, 2016, and 2017 fishing years for red snapper based on the acceptable biological catch levels chosen by the Council, as recommended by its Scientific and Statistical Committee, and on the current commercial and recreational allocations (51-percent commercial and 49-percent recreational). Quotas for subsequent fishing years will remain at 2017 levels unless changed by future rulemaking. All values contained in this final rule are given in round weight. For 2015, the commercial quota is set at 7.293 million lb (3.308 million kg) and the recreational quota is set at 7.007 million lb (3.178 million kg); for 2016, the commercial quota is set at 7.120 million lb (3.230 million kg) and the recreational quota is set at 6.840 million lb (3.103 million kg); and for 2017 and subsequent fishing years, the commercial quota is set at 7.007 million lb (3.178 million kg) and the recreational quota is set at 6.733 million lb (3.054 million kg).

Based on the revised recreational quotas contained in this final rule, the revised recreational ACTs for the 2015, 2016, and 2017 fishing years are as follows: 5.606 million lb (2.543 million kg) for 2015; 5.472 million lb (2.482 million kg) for 2016; and 5.384 million lb (2.442 million kg) for 2017. Recreational ACTs for subsequent fishing years will remain at 2017 levels unless changed by future rulemaking.

Implementation of Amendment 40 to the FMP established two components within the recreational sector for Gulf red snapper (a Federal charter vessel/headboat (for-hire) component and a private angling component), allocated the red snapper recreational quota and ACT between the components, and established separate seasonal closures for the two components. These component quotas and ACTs are effective through 2017. In addition, the final rule for Amendment 40 established ACLs for the commercial and recreational sectors, which are equal to the commercial and recreational quotas, respectively. The Secretary of Commerce approved Amendment 40 on April 10, 2015, and a final rule published on April 22, 2015 (80 FR 22422), effective May 22, 2015.

Based on the component allocations set in Amendment 40 and the increased recreational quotas (equal to the recreational ACLs) contained in this final rule, the resulting recreational component quotas and ACTs are as follows. The for-hire component quota and private angling component quota, respectively, are: 2.964 million lb (1.344 million kg) and 4.043 million lb (1.834 million kg) for 2015; 2.893 million lb (1.312 million kg) and 3.947 million lb (1.790 million kg) for 2016; 2.848 million lb (1.292 million kg) and 3.885 million lb (1.762 million kg) for 2017. The for-hire component ACT and private angling component ACT, respectively, are: 2.371 million lb (1.075 million kg) and 3.234 million lb (1.467 million kg) for 2015; 2.315 million lb (1.050 million kg) and 3.158 million lb (1.432 million kg) for 2016; and 2.278 million lb (1.033 million kg) and 3.108 million lb (1.410 million kg) for 2017.

In accordance with 50 CFR 622.34(b) and 50 CFR 622.41(q)(2)(i), the red snapper recreational fishing season opens each year on June 1 and closes when the applicable component ACT is projected to be reached. To project the 2015 recreational fishing season lengths, NMFS used finalized 2014 landings data, catch rates for each state, state season lengths, as well as other information. The method used to project these season lengths can be found in SERO-LAPP-2015-04: 2015 Gulf of Mexico Red Snapper Recreational Season Length Estimates on the SERO Web site. After analysis of the information referenced above, NMFS determined that the season for the private angling component is 10 days and the season for the for-hire component is 44 days. As required by 50 CFR 622.34(b) and 50 CFR 622.41(q)(2)(i), NMFS announces the closure dates for the recreational sector components (private angling and for-hire components) in the Gulf through this final rule. NMFS opens both components on June 1 and closes the private angling component at 12:01 a.m., local time, June 11, 2015, and the for-hire component at 12:01 a.m., local time, on July 15, 2015.

This final rule makes two administrative changes to the Gulf Individual Fishing Quota (IFQ) program regulations. In §§ 622.21 and 622.22, the Web site for the Gulf IFQ program changes from “ifq.sero.fisheries.noaa.gov” to “https://portal.southeast.fisheries.noaa.gov/cs/main.html” to align with the renaming of NMFS Web sites for all of the regions in the U.S. In § 622.21(b)(6)(ii), NMFS revises the minimum share transfer percentage for the Gulf red snapper IFQ program from “0.0001 percent” to “0.000001 percent” to align with the Gulf grouper/tilefish program minimum share transfer percentage and allows for smaller percentages of red snapper IFQ shares to be transferred. When the red snapper IFQ program was implemented in 2007, NMFS determined, based on the share cap and red snapper commercial quota, that 0.0001 percent was the appropriate minimum share transfer percentage. Because the red snapper commercial quota has been increasing, NMFS has now determined that the minimum share transfer percentage should be 0.000001 percent. This gives shareholders greater flexibility by allowing transfers of smaller increments of shares. In addition, modifying the minimum share transfer percentage for red snapper helps avoid confusion among shareholders who trade both red snapper and grouper/tilefish shares because both programs have the same minimum share transfer percentage.

During the comment period, NMFS received 20 comments, including 17 from private anglers, 1 from a recreational fishing organization, and 2 from charter fishermen. Comments pertinent to the rule unanimously supported increasing the red snapper quota and did not raise any additional issues within the scope of this rulemaking. NMFS agrees with the commenters that the quota increases are appropriate, and are in accordance with the red snapper rebuilding plan.

Many of these same commenters provided additional observations and suggestions for alternative strategies to manage the recreational red snapper harvest that were beyond the scope of the rule. The Council has considered many of the public suggestions in the past and may consider alternative management options for the recreational harvest of red snapper in the future. NMFS agrees that alternative recreational management strategies may prove to be viable options for the management of red snapper in the future; however, these comments and suggestions are beyond the scope of this rulemaking and will not be further addressed in this rule.

The Regional Administrator, Southeast Region, NMFS determined that this final rule and the framework action are necessary for the conversation and management of Gulf red snapper and are consistent with the FMP, the Magnuson-Stevens Act and other applicable law.

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

The Chief Counsel for Regulation of the Department of Commerce certified to the Chief Counsel for Advocacy of the Small Business Administration during the proposed rule stage that this action would not have a significant economic impact on a substantial number of small entities. The factual basis for this determination was published in the proposed rule and is not repeated here. No comments were received regarding the certification and NMFS has not received any new information that would affect its determination. As a result, neither an initial nor final regulatory flexibility analysis was required and therefore, neither was prepared.

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

The Atlantic shark fisheries are managed under the 2006 Consolidated Highly Migratory Species (HMS) Fishery Management Plan (FMP), its amendments, and implementing regulations (50 CFR part 635) issued under authority of the Magnuson-Stevens Fishery Conservation and Management Act (16 U.S.C. 1801 et seq.).

Under § 635.5(b)(1), dealers must electronically submit reports on sharks that are first received from a vessel on a weekly basis through a NMFS-approved electronic reporting system. Reports must be received by no later than midnight, local time, of the first Tuesday following the end of the reporting week unless the dealer is otherwise notified by NMFS. Under § 635.28(b)(2), the quotas of certain species/fisheries and/or management groups are linked. If quotas are linked, when the specified quota threshold for one management group or species/fishery is reached and is closed, the linked management group or fishery closes at the same time. The quotas for aggregated LCS and the hammerhead shark management groups in the Gulf of Mexico region are linked (§ 635.28(b)(3)(ii)). The blacktip shark quota is not linked to the aggregated LCS or hammerhead shark quotas. Regulations at § 635.28(b)(1) and § 635.28(b)(4) authorize closure of the blacktip shark management group when landings have reached or are expected to reach 80 percent of the quota or before those situations occur.

Under § 635.28(b)(1) and § 635.28(b)(2), when NMFS calculates that the landings for any species and/or management group of either a non-linked or a linked group have reached or are projected to reach a threshold of 80 percent of the available quota, NMFS will file for publication with the Office of the Federal Register a notice of closure for all of the species and/or management groups of either a non-linked or linked group that will be effective no fewer than 5 days from date of filing. From the effective date and time of the closure until and if NMFS announces, via a notice in the Federal Register, that additional quota is available and the season is reopened, the fisheries for all linked species and/or management groups and specified non-linked species and/or management groups are closed, even across fishing years.

On December 2, 2014 (79 FR 71331), NMFS announced that the commercial Gulf of Mexico blacktip shark quota was 328.6 mt dw (724,302 lb dw), the Gulf of Mexico aggregated LCS quota for 2015 was 156.5 metric tons (mt) dressed weight (dw) (344,980 lb dw), and the Gulf of Mexico hammerhead shark quota was 25.3 mt dw (55,722 lb dw). Dealer reports recently received through April 24, 2015, indicate that that 261.1 mt dw or 79 percent of the available Gulf of Mexico blacktip shark quota has been landed, 128.6 mt dw or 82 percent of the available Gulf of Mexico aggregated LCS quota has been landed, and that 12.4 mt dw or 49 percent of the available Gulf of Mexico hammerhead shark quota has been landed. Based on these dealer reports, NMFS estimates that the 80-percent limit specified for a closure notice in the regulations for blacktip sharks will be exceeded as of May 1, 2015, and has been exceeded for aggregated LCS. Accordingly, NMFS is closing the commercial blacktip, aggregated LCS, and hammerhead management groups in the Gulf of Mexico region as of 11:30 p.m. local time May 3, 2015. All other shark species or management groups that are currently open will remain open, including the commercial Gulf of Mexico non-blacknose small coastal sharks (SCS), blacknose sharks, blue sharks, and pelagic sharks other than porbeagle or blue.

At § 635.27(b)(1), the boundary between the Gulf of Mexico region and the Atlantic region is defined as a line beginning on the East Coast of Florida at the mainland at 25°20.4′ N. lat, proceeding due east. Any water and land to the south and west of that boundary is considered for the purposes of monitoring and setting quotas, to be within the Gulf of Mexico region.

During the closure, retention of blacktip sharks, aggregated LCS, and/or hammerhead sharks in the Gulf of Mexico region is prohibited for persons fishing aboard vessels issued a commercial shark limited access permit under § 635.4. However, persons aboard a commercially permitted vessel that is also properly permitted to operate as a charter vessel or headboat for HMS and is engaged in a for-hire trip could fish under the recreational retention limits for sharks and “no sale” provisions (§ 635.22(a) and (c)). Similarly, persons aboard a commercially permitted vessel that possesses a valid shark research permit under § 635.32 and has a NMFS-approved observer onboard may continue to harvest and sell blacktip sharks, aggregated LCS, and/or hammerhead sharks in the Gulf of Mexico region pursuant to the terms and conditions of the shark research permit.

During this closure, a shark dealer issued a permit pursuant to § 635.4 may not purchase or receive blacktip sharks, aggregated LCS, and/or hammerhead sharks in the Gulf of Mexico region from a vessel issued an Atlantic Shark Limited Access Permit (LAP), except that a permitted shark dealer or processor may possess blacktip sharks, aggregated LCS, and/or hammerhead sharks in the Gulf of Mexico region that were harvested, off-loaded, and sold, traded, or bartered prior to the effective date of the closure and were held in storage consistent with § 635.28(b)(5). Additionally, a permitted shark dealer or processor may possess blacktip sharks, aggregated LCS, and/or hammerhead sharks in the Gulf of Mexico region that were harvested by a vessel issued a valid shark research fishery permit per § 635.32 with a NMFS-approved observer onboard during the trip the sharks were taken on as long as the LCS research fishery quota remains open. Similarly, a shark dealer issued a permit pursuant to § 635.4 may, in accordance with relevant state regulations, purchase or receive blacktip sharks, aggregated LCS, and/or hammerhead sharks in the Gulf of Mexico region if the sharks were harvested, off-loaded, and sold, traded, or bartered from a vessel that fishes only in state waters and that has not been issued an Atlantic Shark LAP, HMS Angling permit, or HMS Charter/Headboat permit pursuant to § 635.4.

Pursuant to 5 U.S.C. 553(b)(B), the Assistant Administrator for Fisheries, NOAA (AA), finds that providing prior notice and public comment for this action is impracticable and contrary to the public interest because the fishery is currently underway and any delay in this action would result in overharvest of the quota and be inconsistent with management requirements and objectives. Similarly, affording prior notice and opportunity for public comment on this action is contrary to the public interest because if the quota is exceeded, the stock may be negatively affected and fishermen ultimately could experience reductions in the available quota and a lack of fishing opportunities in future seasons. For these reasons, the AA also finds good cause to waive the 30-day delay in effective date pursuant to 5 U.S.C. 553(d)(3). This action is required under § 635.28(b)(2) and is exempt from review under Executive Order 12866.