Federal Register Vol. 81, No.107,

Federal Register Volume 81, Issue 107 (June 3, 2016)

Page Range35579-36136
FR Document

81_FR_107
Current View
Page and SubjectPDF
81 FR 36135 - National Oceans Month, 2016PDF
81 FR 36133 - National Caribbean-American Heritage Month, 2016PDF
81 FR 36131 - Lesbian, Gay, Bisexual, and Transgender Pride Month, 2016PDF
81 FR 36129 - Great Outdoors Month, 2016PDF
81 FR 36127 - African-American Music Appreciation Month, 2016PDF
81 FR 35579 - Delegation of Authority Under Section 106 of the Bipartisan Congressional Trade Priorities and Accountability Act of 2015PDF
81 FR 35808 - Sunshine Act MeetingPDF
81 FR 35617 - Special Local Regulation; Tri-City Water Follies Spring Testing, Kennewick, WAPDF
81 FR 35790 - Missouri; Amendment No. 2 to Notice of a Major Disaster DeclarationPDF
81 FR 35789 - Montana; Major Disaster and Related DeterminationsPDF
81 FR 35789 - Missouri; Amendment No. 3 to Notice of a Major Disaster DeclarationPDF
81 FR 35789 - Mississippi; Amendment No. 6 to Notice of a Major Disaster DeclarationPDF
81 FR 35739 - Takes of Marine Mammals Incidental to Specified Activities; Sand Quality Study Activities at the Children's Pool Beach, La Jolla, CaliforniaPDF
81 FR 35782 - Pharmacy Compounding Advisory Committee; Notice of MeetingPDF
81 FR 35781 - E18 Genomic Sampling and Management of Genomic Data; International Council for Harmonisation; Draft Guidance for Industry; AvailabilityPDF
81 FR 35776 - Individual Patient Expanded Access Applications: Form FDA 3926; Guidance for Industry; AvailabilityPDF
81 FR 35779 - Charging for Investigational Drugs Under an Investigational New Drug Application-Questions and Answers; Guidance for Industry; AvailabilityPDF
81 FR 35778 - Expanded Access to Investigational Drugs for Treatment Use-Questions and Answers; Guidance for Industry; AvailabilityPDF
81 FR 35809 - U.S. Department of State Advisory Committee on Private International Law: Public Meeting on Online Dispute ResolutionPDF
81 FR 35641 - Nevada: Final Authorization of State Hazardous Waste Management Program RevisionsPDF
81 FR 35648 - Change-2 to Navigation and Vessel Inspection Circular 04-08: Medical Certification Standards, Medications, and Medical Review ProcessPDF
81 FR 35767 - Pesticides; Draft Guidance for Pesticide Registrants on Herbicide Resistance Management Labeling, Education, Training, and StewardshipPDF
81 FR 35766 - Pesticides; Draft Guidance for Pesticide Registrants on Pesticide Resistance Management LabelingPDF
81 FR 35788 - Proposed Collection; 60-Day Comment Request: Generic Clearance for the Collection of Qualitative Feedback on Agency Service Delivery, National Institute of Neurological Disorders and Stroke (NINDS)PDF
81 FR 35762 - Proposed Information Collection Request Submitted to OMB for Review and Approval; Comment Request; Procedures for Implementing the National Environmental Policy Act and Assessing the Environmental Effects Abroad of EPA Actions (Renewal)PDF
81 FR 35792 - Endangered Species; Receipt of Applications for PermitPDF
81 FR 35761 - Environmental Impact Statements; Notice of AvailabilityPDF
81 FR 35654 - Special Conditions: Bell Helicopter Textron, Inc. (BHTI), Model 525 Helicopters; Crew Alerting System (CAS)PDF
81 FR 35811 - Public Notice For Waiver for Aeronautical Land-Use Assurance at Pleasanton Municipal Airport, Pleasanton, TXPDF
81 FR 35811 - Public Notice For Waiver of Aeronautical Land-Use Assurance; Former Willmar Municipal Airport Willmar, MNPDF
81 FR 35814 - Proposed Agency Information Collection Activities; Comment RequestPDF
81 FR 35813 - Proposed Agency Information Collection Activities; Comment RequestPDF
81 FR 35809 - WRL, LLC-Modified Rail Certificate of Public Convenience and Necessity-Adams and Grant Counties, Wash.PDF
81 FR 35644 - Administration for Community Living-Regulatory ConsolidationPDF
81 FR 35653 - Fisheries Off West Coast States; the Highly Migratory Species Fishery; ClosurePDF
81 FR 35643 - State Health Insurance Assistance Program (SHIP)PDF
81 FR 35786 - Notice of Tribal Consultation and Urban Confer Sessions on the State of the Great Plains Area Indian Health ServicePDF
81 FR 35807 - New Postal ProductPDF
81 FR 35806 - New Postal ProductPDF
81 FR 35736 - New England Fishery Management Council; Public MeetingPDF
81 FR 35793 - Notice of Availability of the Draft Resource Management Plan and Draft Environmental Impact Statement for the Uncompahgre Field Office, ColoradoPDF
81 FR 35796 - Notice of Availability of the Draft Medford District Resource Management Plan Amendment and Environmental Assessment: Table Rocks Area of Critical Environmental Concern Proposed Boundary Change and Supplementary RulesPDF
81 FR 35757 - Combined Notice of Filings #2PDF
81 FR 35758 - Combined Notice of Filings #1PDF
81 FR 35749 - Procurement List; AdditionsPDF
81 FR 35749 - Procurement List; Proposed Additions and DeletionsPDF
81 FR 35734 - International Trade Data System Test Concerning the Electronic Submission of Certain Data Required for ExportsPDF
81 FR 35817 - Community Development Financial Institutions Fund; Notice and Request for CommentsPDF
81 FR 35815 - Information Collection: Capital Magnet Fund Application; Capital Magnet Fund Annual ReportPDF
81 FR 35756 - Agency Information Collection Activities; Comment Request; Study of the Turnaround School Leaders ProgramPDF
81 FR 35698 - Endangered and Threatened Wildlife and Plants; 90-Day Findings on Two PetitionsPDF
81 FR 35671 - Safety Zones; Safety Zones Within the Captain of the Port New Orleans Zone; New Orleans to Baton Rouge, LAPDF
81 FR 35787 - Government-Owned Inventions; Availability for LicensingPDF
81 FR 35737 - Notice of Sites Added to the Inventory of Possible Areas for Designation as New National Marine SanctuariesPDF
81 FR 35747 - Interagency Working Group on the Harmful Algal Bloom and Hypoxia Research and Control Amendments ActPDF
81 FR 35804 - Agency Information Collection Activities; Submission for OMB Review; Comment Request; Standard on 4,4'-Methylenedianiline for General IndustryPDF
81 FR 35619 - Safety Zone; Richland Regatta, Columbia River, Richland, WAPDF
81 FR 35752 - Proposed Collection; Comment RequestPDF
81 FR 35733 - Sabine-Angelina Resource Advisory CommitteePDF
81 FR 35774 - Proposed Information Collection Activity; Comment RequestPDF
81 FR 35798 - Information Collection Activities: Sulphur Operations, Proposed Collection; Comment RequestPDF
81 FR 35790 - South Bay Salt Pond Restoration Project, Phase 2; Don Edwards National Wildlife Refuge; Final Environmental Impact Statement/Environmental Impact ReportPDF
81 FR 35661 - Labeling and Advertising of Home InsulationPDF
81 FR 35733 - Open Meeting of the Commission on Enhancing National CybersecurityPDF
81 FR 35819 - Proposed Collection; Comment Request for Form 5578PDF
81 FR 35820 - Proposed Collection; Comment Request for Regulation ProjectPDF
81 FR 35818 - Proposed Collection; Comment Request for Regulation ProjectPDF
81 FR 35819 - Proposed Collection; Comment Request for Revenue Procedure 2000-42PDF
81 FR 35769 - Deletion of Consent Agenda Items From Sunshine Act MeetingPDF
81 FR 35680 - Assessment and Collection of Regulatory Fees for Fiscal Year 2016PDF
81 FR 35753 - Charter Renewal of Department of Defense Federal Advisory CommitteesPDF
81 FR 35770 - Health Insurance MarketplaceSMPDF
81 FR 35772 - Medicare, Medicaid, and Children's Health Insurance Programs; Announcement of the Advisory Panel on Clinical Diagnostic Laboratory Tests Meeting on July 18, 2016PDF
81 FR 35610 - Food Additives Permitted in Feed and Drinking Water of Animals; Chromium PropionatePDF
81 FR 35805 - Notice of Intent To Request New Information CollectionPDF
81 FR 35754 - Notice of Availability of the Draft Environmental Impact Statement for the Lower Yellowstone Intake Diversion Dam Fish Passage Project, Dawson County, MontanaPDF
81 FR 35774 - Agency Information Collection Activities; Submission for Office of Management and Budget Review; Comment Request; Reporting Associated With New Animal Drug ApplicationsPDF
81 FR 35756 - Availability of a Draft Integrated Feasibility Report (Feasibility Report/Environmental Impact Statement), Flood Risk Management Study, Little Colorado River at Winslow, Navajo County, AZPDF
81 FR 35811 - Petition for Exemption; Summary of Petition Received; Falcon Skydiving TeamPDF
81 FR 35813 - Petition for Exemption; Summary of Petition Received; Aviation Systems Engineering Company: ExtensionPDF
81 FR 35812 - Petition for Exemption; Summary of Petition Received; AeroLogix Consulting Inc.: CorrectionPDF
81 FR 35783 - National Vaccine Injury Compensation Program; List of Petitions ReceivedPDF
81 FR 35785 - Findings of Research MisconductPDF
81 FR 35808 - Product Change-Priority Mail Negotiated Service AgreementPDF
81 FR 35803 - Notice of Receipt of Complaint; Solicitation of Comments Relating to the Public InterestPDF
81 FR 35801 - Notice of Receipt of Complaint; Solicitation of Comments Relating to the Public InterestPDF
81 FR 35802 - Notice of Receipt of Complaint; Solicitation of Comments Relating to the Public InterestPDF
81 FR 35807 - Product Change-Priority Mail Negotiated Service AgreementPDF
81 FR 35759 - Peak Reliability; Request for Clarification of Peak ReliabilityPDF
81 FR 35808 - Product Change-Parcel Select Negotiated Service AgreementPDF
81 FR 35808 - Product Change-First-Class Package Service Negotiated Service AgreementPDF
81 FR 35769 - Notice of Funding Availability for the Spill Impact Component of the RESTORE ActPDF
81 FR 35665 - Imposition of Special Measure Against North Korea as a Jurisdiction of Primary Money Laundering ConcernPDF
81 FR 35634 - Air Plan Approval; North Carolina; Prong 4-2008 Ozone, 2010 NO2PDF
81 FR 35674 - Approval and Promulgation of Air Quality Implementation Plans; Louisiana; Infrastructure State Implementation Plan Requirements for the National Ambient Air Quality StandardsPDF
81 FR 35662 - Rules of Practice and Procedure Concerning Regulatory Program Fees and Basin Regulations-Water Supply Charges Concerning RatesPDF
81 FR 35608 - Clarifying Language in the Basin Regulations-Water Supply Charges Relating to Certificates of EntitlementPDF
81 FR 35820 - Proposed Collection; Comment Request for Revenue Procedure 2010-13PDF
81 FR 35984 - Guaranteed Loanmaking and Servicing RegulationsPDF
81 FR 35750 - Teavana Corporation, Provisional Acceptance of a Settlement Agreement and OrderPDF
81 FR 35810 - 60-Day Notice of Intent to Seek Extension of Approval: Household Goods Movers' Disclosure RequirementsPDF
81 FR 35790 - Federal Property Suitable as Facilities To Assist the HomelessPDF
81 FR 35657 - Airworthiness Directives; Ameri-King Corporation Emergency Locator TransmittersPDF
81 FR 35583 - Cooperative Agreements With Commercial FirmsPDF
81 FR 35655 - Airworthiness Directives; The Boeing Company AirplanesPDF
81 FR 36078 - Endangered and Threatened Species; Critical Habitat for the Endangered Carolina and South Atlantic Distinct Population Segments of Atlantic SturgeonPDF
81 FR 35701 - Endangered and Threatened Species; Designation of Critical Habitat for the Gulf of Maine, New York Bight, and Chesapeake Bay Distinct Population Segments of Atlantic SturgeonPDF
81 FR 35586 - Revisions to Definitions in the Export Administration RegulationsPDF
81 FR 35611 - International Traffic in Arms: Revisions to Definition of Export and Related DefinitionsPDF
81 FR 35760 - Request for Nominations for Peer Reviewers for EPA's Draft Biologically Based Dose-Response (BBDR) Model for Perchlorate, Draft Model Support Document and Draft Approach for Deriving a Maximum Contaminant Level Goal (MCLG) for Perchlorate in Drinking WaterPDF
81 FR 35581 - Airworthiness Directives; BLANIK LIMITED GlidersPDF
81 FR 35652 - Television Broadcasting Services; Scottsbluff, Nebraska and Sidney, NebraskaPDF
81 FR 35636 - Approval and Promulgation of Implementation Plans; Connecticut; Infrastructure Requirements for Lead, Ozone, Nitrogen Dioxide, Sulfur Dioxide, and Fine Particulate MatterPDF
81 FR 36030 - Developing a New Regulatory Framework for Business Data Services (Special Access)PDF
81 FR 35824 - Oil and Natural Gas Sector: Emission Standards for New, Reconstructed, and Modified SourcesPDF
81 FR 35944 - Federal Implementation Plan for True Minor Sources in Indian Country in the Oil and Natural Gas Production and Natural Gas Processing Segments of the Oil and Natural Gas Sector; Amendments to the Federal Minor New Source Review Program in Indian Country To Address Requirements for True Minor Sources in the Oil and Natural Gas SectorPDF
81 FR 35622 - Source Determination for Certain Emission Units in the Oil and Natural Gas SectorPDF
81 FR 35763 - Proposed Information Collection Request; Comment Request; Information Collection Effort for Oil and Gas FacilitiesPDF

Issue

81 107 Friday, June 3, 2016 Contents Agriculture Agriculture Department See

Forest Service

See

Rural Business-Cooperative Service

See

Rural Utilities Service

Safety Enviromental Enforcement Bureau of Safety and Environmental Enforcement NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Sulphur Operations, 35798-35801 2016-13102 Centers Medicare Centers for Medicare & Medicaid Services RULES State Health Insurance Assistance Program, 35643-35644 2016-13136 NOTICES Meetings: Health Insurance MarketplaceSM, Medicare, Medicaid, and Children's Health Insurance Program; Advisory Panel on Outreach and Education, 35770-35772 2016-13085 Medicare, Medicaid, and Children's Health Insurance Programs; Advisory Panel on Clinical Diagnostic Laboratory Tests, 35772-35774 2016-13084 Children Children and Families Administration NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Migrant and Seasonal Head Start Study, 35774 2016-13104 Coast Guard Coast Guard RULES Guidance: Navigation and Vessel Inspection Circular: Medical Certification Standards, Medications, and Medical Review Process; Change, 35648-35652 2016-13158 Safety Zones: Richland Regatta, Columbia River, Richland, WA, 35619-35621 2016-13108 Special Local Regulations: Tri-City Water Follies Spring Testing, Kennewick, WA, 35617-35619 2016-13201 PROPOSED RULES Safety Zones: Safety Zones Within the Captain of the Port New Orleans Zone; New Orleans to Baton Rouge, LA, 35671-35674 2016-13119 Commerce Commerce Department See

Industry and Security Bureau

See

National Institute of Standards and Technology

See

National Oceanic and Atmospheric Administration

Committee for Purchase Committee for Purchase From People Who Are Blind or Severely Disabled NOTICES Procurement List; Additions and Deletions, 35749-35750 2016-13126 2016-13127 Community Development Community Development Financial Institutions Fund NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Community Development Financial Institutions Fund, 35815-35818 2016-13122 2016-13123 Community Living Administration Community Living Administration RULES Administration for Community Living--Regulatory Consolidation, 35644-35648 2016-13138 Consumer Product Consumer Product Safety Commission NOTICES Settlement Agreements and Orders: Teavana Corp., 35750-35752 2016-12944 Defense Department Defense Department See

Engineers Corps

NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 35752-35753 2016-13107 Charter Renewals: Federal Advisory Committees, 35753-35754 2016-13086
Delaware Delaware River Basin Commission RULES Clarifying Language in the Basin Regulations—Water Supply Charges Relating to Certificates of Entitlement, 35608-35609 2016-13011 PROPOSED RULES Rules of Practice and Procedure Concerning Regulatory Program Fees and Basin Regulations—Water Supply Charges Concerning Rates, 35662-35665 2016-13012 Education Department Education Department NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Study of the Turnaround School Leaders Program, 35756-35757 2016-13121 Energy Department Energy Department See

Federal Energy Regulatory Commission

Engineers Engineers Corps NOTICES Environmental Impact Statements; Availability, etc.: Draft Integrated Feasibility Report, Flood Risk Management Study, Little Colorado River at Winslow, Navajo County, AZ, 35756 2016-13077 Lower Yellowstone Intake Diversion Dam Fish Passage Project, Dawson County, MT, 35754-35756 2016-13079 Environmental Protection Environmental Protection Agency RULES Air Quality State Implementation Plans; Approvals and Promulgations: Connecticut; Infrastructure Requirements for Lead, Ozone, Nitrogen Dioxide, Sulfur Dioxide, and Fine Particulate Matter, 35636-35641 2016-12375 North Carolina; Prong 4—2008 Ozone, 2010 NO2, SO2, and 2012 PM2.5, 35634-35636 2016-13036 Federal Implementation Plans: True Minor Sources in Indian Country in the Oil and Natural Gas Production and Natural Gas Processing Segments of the Oil and Natural Gas Sector; Amendments to the Federal Minor New Source Review Program in Indian Country To Address Requirements for True Minor Sources in the Oil and Natural Gas Sector, 35944-35981 2016-11969 Final Authorization of State Hazardous Waste Management Program Revisions: Nevada, 35641-35643 2016-13161 Oil and Natural Gas Sector: Emission Standards for New, Reconstructed, and Modified Sources, 35824-35942 2016-11971 Source Determination for Certain Emission Units in the Oil and Natural Gas Sector, 35622-35634 2016-11968 PROPOSED RULES Air Quality State Implementation Plans; Approvals and Promulgations: Louisiana; Infrastructure State Implementation Plan Requirements for the National Ambient Air Quality Standards, 35674-35680 2016-13032 NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Information Collection Effort for Oil and Gas Facilities, 35763-35766 2016-11967 Procedures for Implementing the National Environmental Policy Act and Assessing the Environmental Effects Abroad of EPA Actions, 35762-35763 2016-13153 Draft Guidance: Pesticides; Pesticide Registrants on Herbicide Resistance Management Labeling, Education, Training, and Stewardship, 35767-35769 2016-13157 Pesticides; Pesticide Registrants on Pesticide Resistance Management Labeling, 35766-35767 2016-13155 Environmental Impact Statements; Availability, 35761-35762 2016-13150 Requests for Nominations: Peer Reviewers; Draft Biologically Based Dose-Response Model for Perchlorate, Draft Model Support Document and Draft Approach for Deriving a Maximum Contaminant Level Goal for Perchlorate in Drinking Water, 35760-35761 2016-12724 Federal Aviation Federal Aviation Administration RULES Airworthiness Directives: BLANIK LIMITED Gliders, 35581-35583 2016-12608 PROPOSED RULES Airworthiness Directives: Ameri-King Corporation Emergency Locator Transmitters, 35657-35661 2016-12852 The Boeing Company Airplanes, 35655-35657 2016-12849 Special Conditions: Bell Helicopter Textron, Inc. (BHTI), Model 525 Helicopters; Crew Alerting System, 35654-35655 2016-13148 NOTICES Aeronautical Land-Use Assurance Waivers: Former Willmar Municipal Airport, Willmar, MN, 35811-35812 2016-13143 Pleasanton Municipal Airport, Pleasanton, TX, 35811 2016-13147 Petitions for Exemption; Summaries, 35812-35813 2016-13074 2016-13075 2016-13076 Federal Communications Federal Communications Commission RULES Television Broadcasting Services: Scottsbluff, NE, and Sidney, NE, 35652-35653 2016-12603 PROPOSED RULES Assessment and Collection of Regulatory Fees, 35680-35698 2016-13087 New Regulatory Framework for Business Data Services (Special Access), 36030-36075 2016-12058 NOTICES Deletion of Consent Agenda Items From Sunshine Act Meeting, 35769 2016-13089 Federal Emergency Federal Emergency Management Agency NOTICES Major Disaster and Related Determinations: Montana, 35789-35790 2016-13178 Major Disaster Declarations: Mississippi; Amendment No. 6, 35789 2016-13175 Missouri; Amendment No. 2, 35790 2016-13180 Missouri; Amendment No. 3, 35789 2016-13176 Federal Energy Federal Energy Regulatory Commission NOTICES Clarification of Peak Reliability, 35759-35760 2016-13064 Combined Filings, 35757-35759 2016-13063 2016-13128 2016-13129 Federal Railroad Federal Railroad Administration NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 35813-35815 2016-13141 2016-13142 Federal Trade Federal Trade Commission PROPOSED RULES Labeling and Advertising of Home Insulation, 35661-35662 2016-13097 Financial Crimes Financial Crimes Enforcement Network PROPOSED RULES Imposition of Special Measure Against North Korea as a Jurisdiction of Primary Money Laundering Concern, 35665-35671 2016-13037 Fish Fish and Wildlife Service PROPOSED RULES Endangered and Threatened Wildlife and Plants: 90-Day Findings on Two Petitions, 35698-35701 2016-13120 NOTICES Endangered and Threatened Wildlife and Plants Permit Applications, 35792-35793 2016-13151 Environmental Impact Statements; Availability, etc.: South Bay Salt Pond Restoration Project, Phase 2; Don Edwards National Wildlife Refuge, 35790-35792 2016-13100 Food and Drug Food and Drug Administration RULES Food Additives Permitted in Feed and Drinking Water of Animals: Chromium Propionate, 35610-35611 2016-13082 NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Reporting Associated With New Animal Drug Applications, 35774-35776 2016-13078 Guidance: Charging for Investigational Drugs Under an Investigational New Drug Application--Questions and Answers, 35779-35781 2016-13166 E18 Genomic Sampling and Management of Genomic Data; International Council for Harmonisation, 35781-35782 2016-13168 Expanded Access to Investigational Drugs for Treatment Use--Questions and Answers, 35778-35779 2016-13165 Individual Patient Expanded Access Applications, 35776-35777 2016-13167 Meetings: Pharmacy Compounding Advisory Committee, 35782-35783 2016-13169 Forest Forest Service NOTICES Meetings: Sabine-Angelina Resource Advisory Committee, 35733 2016-13106 Gulf Coast Ecosystem Restoration Council Gulf Coast Ecosystem Restoration Council NOTICES Funding Availability: Spill Impact Component of the RESTORE Act, 35769-35770 2016-13059 Health and Human Health and Human Services Department See

Centers for Medicare & Medicaid Services

See

Children and Families Administration

See

Community Living Administration

See

Food and Drug Administration

See

Health Resources and Services Administration

See

Indian Health Service

See

National Institutes of Health

RULES Administration for Community Living—Regulatory Consolidation, 35644-35648 2016-13138 State Health Insurance Assistance Program, 35643-35644 2016-13136 NOTICES Findings of Research Misconduct, 35785-35786 2016-13072
Health Resources Health Resources and Services Administration NOTICES Petitions: National Vaccine Injury Compensation Program, 35783-35785 2016-13073 Homeland Homeland Security Department See

Coast Guard

See

Federal Emergency Management Agency

Housing Housing and Urban Development Department NOTICES Federal Property Suitable as Facilities To Assist the Homeless, 35790 2016-12861 Indian Health Indian Health Service NOTICES Meetings: Tribal Consultation and Urban Confer Sessions on the State of the Great Plains Area Indian Health Service, 35786-35787 2016-13135 Industry Industry and Security Bureau RULES Export Administration Regulations: Revisions to Definitions, 35586-35608 2016-12734 Interior Interior Department See

Bureau of Safety and Environmental Enforcement

See

Fish and Wildlife Service

See

Land Management Bureau

See

Reclamation Bureau

Internal Revenue Internal Revenue Service NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 35818-35821 2016-13000 2016-13090 2016-13091 2016-13092 2016-13093 2016-13094 International Trade Com International Trade Commission NOTICES Complaints: Certain Inkjet Printers, Printheads, and Ink Cartridges, Components Thereof, and Products Containing Same, 35803-35804 2016-13070 Certain Magnetic Data Storage Tapes and Cartridges Containing the Same, 35802-35803 2016-13068 Certain Silicon-on-Insulator Wafers, 35801-35802 2016-13069 Labor Department Labor Department NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Standard on 4,4'-Methylenedianiline for General Industry, 35804-35805 2016-13109 Land Land Management Bureau NOTICES Environmental Assessments; Availability, etc.: Draft Medford District Resource Management Plan Amendment Table Rocks Area of Critical Environmental Concern Proposed Boundary Change, 35796-35798 2016-13130 Environmental Impact Statements; Availability, etc.: Draft Resource Management Plan, Uncompahgre Field Office, Colorado, 35793-35796 2016-13131 NASA National Aeronautics and Space Administration RULES Cooperative Agreements With Commercial Firms, 35583-35586 2016-12850 National Institute National Institute of Standards and Technology NOTICES Meetings: Commission on Enhancing National Cybersecurity, 35733-35734 2016-13096 National Institute National Institutes of Health NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Generic Clearance for the Collection of Qualitative Feedback on Agency Service Delivery, National Institute of Neurological Disorders and Stroke, 35788-35789 2016-13154 Government-Owned Inventions; Availability for Licensing, 35787 2016-13112 National Oceanic National Oceanic and Atmospheric Administration RULES Fisheries Off West Coast States: Highly Migratory Species Fishery; Closure, 35653 2016-13137 PROPOSED RULES Endangered and Threatened Species: Critical Habitat for the Endangered Carolina and South Atlantic Distinct Population Segments of Atlantic Sturgeon, 36078-36123 2016-12744 Designation of Critical Habitat for the Gulf of Maine, New York Bight, and Chesapeake Bay Distinct Population Segments of Atlantic Sturgeon, 35701-35732 2016-12743 NOTICES Interagency Working Group on the Harmful Algal Bloom and Hypoxia Research and Control Amendments Act, 35747-35749 2016-13110 International Trade Data System Test Concerning the Electronic Submission of Certain Data Required for Exports, 35734-35736 2016-13125 Meetings: New England Fishery Management Council, 35736-35737 2016-13132 Sites Added to the Inventory of Possible Areas for Designation as New National Marine Sanctuaries, 35737-35739 2016-13111 Takes of Marine Mammals: Sand Quality Study Activities at the Children's Pool Beach, La Jolla, CA, 35739-35747 2016-13171 National Science National Science Foundation NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 35805-35806 2016-13081 Postal Regulatory Postal Regulatory Commission NOTICES New Postal Products, 35806-35807 2016-13133 2016-13134 Postal Service Postal Service NOTICES Product Changes: First-Class Package Service Negotiated Service Agreement, 35808 2016-13061 Parcel Select Negotiated Service Agreement, 35808 2016-13062 Priority Mail Negotiated Service Agreement, 35807-35808 2016-13065 2016-13066 2016-13067 2016-13071 Presidential Documents Presidential Documents PROCLAMATIONS Special Observances: African-American Music Appreciation Month (Proc. 9455), 36125-36128 2016-13357 Great Outdoors Month (Proc. 9456), 36129-36130 2016-13358 Lesbian, Gay, Bisexual, and Transgender Pride Month (Proc. 9457), 36131-36132 2016-13361 National Caribbean-American Heritage Month (Proc. 9458), 36133-36134 2016-13363 National Oceans Month (Proc. 9459), 36135-36136 2016-13364 ADMINISTRATIVE ORDERS Bipartisan Congressional Trade Priorities and Accountability Act of 2015; Delegation of Authority (Memorandum of May 24, 2016), 35579 2016-13290 Reclamation Reclamation Bureau NOTICES Environmental Impact Statements; Availability, etc.: Lower Yellowstone Intake Diversion Dam Fish Passage Project, Dawson County, MT, 35754-35756 2016-13079 Rural Business Rural Business-Cooperative Service RULES Guaranteed Loanmaking and Servicing Regulations, 35984-36027 2016-12945 Rural Utilities Rural Utilities Service RULES Guaranteed Loanmaking and Servicing Regulations, 35984-36027 2016-12945 Securities Securities and Exchange Commission NOTICES Meetings; Sunshine Act, 35808-35809 2016-13213 State Department State Department RULES International Traffic in Arms: Revisions to Definition of Export and Related Definitions, 35611-35617 2016-12732 NOTICES Meetings: Advisory Committee on Private International Law, 35809 2016-13163 Surface Transportation Surface Transportation Board NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Household Goods Movers' Disclosure Requirements, 35810-35811 2016-12897 Modified Rail Certificates of Public Convenience and Necessity: WRL, LLC, Adams and Grant Counties, WA, 35809-35810 2016-13139 Transportation Department Transportation Department See

Federal Aviation Administration

See

Federal Railroad Administration

Treasury Treasury Department See

Community Development Financial Institutions Fund

See

Financial Crimes Enforcement Network

See

Internal Revenue Service

Separate Parts In This Issue Part II Environmental Protection Agency, 35824-35942 2016-11971 Part III Environmental Protection Agency, 35944-35981 2016-11969 Part IV Agriculture Department, Rural Business-Cooperative Service, 35984-36027 2016-12945 Agriculture Department, Rural Utilities Service, 35984-36027 2016-12945 Part V Federal Communications Commission, 36030-36075 2016-12058 Part VI Commerce Department, National Oceanic and Atmospheric Administration, 36078-36123 2016-12744 Part VII Presidential Documents, 36125-36136 2016-13357 2016-13358 2016-13361 2016-13363 2016-13364 Reader Aids

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

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

81 107 Friday, June 3, 2016 Rules and Regulations DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2016-4231; Directorate Identifier 2015-CE-042-AD; Amendment 39-18537; AD 2016-11-10] RIN 2120-AA64 Airworthiness Directives; BLANIK LIMITED Gliders AGENCY:

Federal Aviation Administration (FAA), Department of Transportation (DOT).

ACTION:

Final rule.

SUMMARY:

We are superseding airworthiness directive (AD) 2000-20-11 for BLANIK LIMITED Models L-13 Blanik and L-13 AC Blanik gliders (type certificate previously held by LET Aeronautical Works). This AD results from mandatory continuing airworthiness information (MCAI) issued by an aviation authority of another country to identify and correct an unsafe condition on an aviation product. The MCAI describes the unsafe condition as insufficient material strength of the tail-fuselage attachment fitting. We are issuing this AD to require actions to address the unsafe condition on these products.

DATES:

This AD is effective July 8, 2016.

The Director of the Federal Register approved the incorporation by reference of a certain other publication listed in this AD as of November 27, 2000 (65 FR 60845, October 13, 2000).

ADDRESSES:

You may examine the AD docket on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2016-4231; or in person at the Docket Management Facility, U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590.

For service information identified in this AD, contact BLANIK LIMITED, 2nd Floor Beaux Lane House, Mercer Street Lower, Dublin 2, Republic of Ireland; phone: +420 733 662 194; email: [email protected]; Internet: http://www.blanik.aero/%EF%BB%BFcustomer_support. You may view this referenced service information at the FAA, Small Airplane Directorate, 901 Locust, Kansas City, Missouri 64106. For information on the availability of this material at the FAA, call (816) 329-4148. It is also available on the Internet at http://www.regulations.gov by searching for Docket No. FAA-2016-4231.

FOR FURTHER INFORMATION CONTACT:

Jim Rutherford, Aerospace Engineer, 901 Locust, Room 301, Kansas City, Missouri 64106; telephone: (816) 329-4165; fax: (816) 329-4090; email: [email protected]

SUPPLEMENTARY INFORMATION:

Discussion

We issued a notice of proposed rulemaking (NPRM) to amend 14 CFR part 39 by adding an AD that would apply to BLANIK LIMITED Models L-13 Blanik and L-13 AC Blanik gliders. That NPRM was published in the Federal Register on March 3, 2016 (81 FR 11134), and proposed to supersede AD 2000-20-11, Amendment 39-11922 (65 FR 60845; October 13, 2000).

The NPRM proposed to correct an unsafe condition for the specified products and was based on mandatory continuing airworthiness information (MCAI) originated by an aviation authority of another country. The MCAI states that:

To prevent destruction of tail-fuselage attachment fitting which can lead to loss of control of the sailplane. This destruction could be caused due to lower strength of the material used during production.

The MCAI can be found in the AD docket on the Internet at: https://www.regulations.gov/#!documentDetail;D=FAA-2016-4231-0003.

A review of records since issuance of AD 2000-20-11 revealed that the FAA inadvertently did not address this MCAI for the EVEKCTOR, spol. s.r.o. Model L 13 SDM VIVAT gliders and the BLANIK LIMITED Model L-13 AC Blanik gliders. This AD supersedes AD 2000-20-11 to add the BLANIK LIMITED Model L-13 AC Blanik gliders to the applicability of the AD.

The FAA is addressing the EVEKTOR, spol. s.r.o. Model L 13 SDM VIVAT gliders in another AD action.

Comments

We gave the public the opportunity to participate in developing this AD. We received no comments on the NPRM (81 FR 11134, March 3, 2016) or on the determination of the cost to the public.

Conclusion

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

• Are consistent with the intent that was proposed in the NPRM (81 FR 11134, March 3, 2016) for correcting the unsafe condition; and

• Do not add any additional burden upon the public than was already proposed in the NPRM (81 FR 11134, March 3, 2016).

Related Service Information Under 1 CFR Part 51

LET Aeronautical Works has issued LET Mandatory Bulletin No.: L13/085a, dated November 17, 1999. The service information describes procedures for testing the material strength of attachment fitting part number A 102 021 N and instructions for contacting the manufacturer for replacement information if necessary. This service information is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the ADDRESSES section of the AD.

Costs of Compliance

We estimate that this AD will affect 124 products of U.S. registry. We also estimate that it would take about 4 work-hours per product to comply with the basic requirements of this AD. The average labor rate is $85 per work-hour.

Based on these figures, we estimate the cost of the AD on U.S. operators to be $42,160, or $340 per product.

In addition, we estimate that any necessary follow-on actions would take about 16 work-hours and require parts costing $500, for a cost of $1,860 per product. We have no way of determining the number of products that may need these actions.

Authority for This Rulemaking

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.

Regulatory Findings

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

For the reasons discussed above, I certify this AD:

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

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

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

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

Examining the AD Docket

You may examine the AD docket on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2016-4231; or in person at the Docket Management Facility between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains the NPRM, the regulatory evaluation, any comments received, and other information. The street address for the Docket Office (telephone (800) 647-5527) is in the ADDRESSES section. Comments will be available in the AD docket shortly after receipt.

List of Subjects in 14 CFR Part 39

Air transportation, Aircraft, Aviation safety, Incorporation by reference, Safety.

Adoption of the Amendment

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

PART 39—AIRWORTHINESS DIRECTIVES 1. The authority citation for part 39 continues to read as follows: Authority:

49 U.S.C. 106(g), 40113, 44701.

§ 39.13 [Amended]
2. The FAA amends § 39.13 by removing Amendment 39-11922 (65 FR 60845; October 13, 2000) and adding the following new AD: 2016-11-10 BLANIK LIMITED: Amendment 39-18537; Docket No. FAA-2016-4231; Directorate Identifier 2015-CE-042-AD. (a) Effective Date

This airworthiness directive (AD) becomes effective July 8, 2016.

(b) Affected ADs

This AD supersedes AD 2000-20-11, Amendment 39-11922 (65 FR 60845; October 13, 2000) (“AD 2000-20-11”).

(c) Applicability

This AD applies to BLANIK LIMITED Models L-13 Blanik and L-13 AC Blanik gliders (type certificate previously held by LET Aeronautical Works), all serial numbers, certificated in any category.

(d) Subject

Air Transport Association of America (ATA) Code 53: Fuselage.

(e) Reason

This AD was prompted by mandatory continuing airworthiness information (MCAI) originated by an aviation authority of another country to identify and correct an unsafe condition on an aviation product. The MCAI describes the unsafe condition as insufficient material strength of the tail-fuselage attachment fitting. We are issuing this AD to detect and correct tail-fuselage fittings with insufficient material strength, which if left uncorrected could result in detachment of the tail from the fuselage with consequent loss of control.

(f) Actions and Compliance

Unless already done, do the following actions in paragraphs (f)(1) and (f)(2) of this AD, including all subparagraphs:

(1) Model L-13 Blanik gliders:

(i) Within the next 60 days after November 27, 2000 (the effective date retained from AD 2000-20-11), inspect the tail-fuselage attachment fitting, part number (P/N) A 102 021 N, for damage and material hardness following the procedures in LET Mandatory Bulletin No.: L13/085a, dated November 17, 1999.

(ii) If you find the tail-fuselage attachment fitting is damaged or the material does not meet the hardness requirements specified in the service bulletin during the inspection required in paragraph (f)(1)(i) of this AD, before further flight, you must contact the manufacturer to obtain an FAA-approved replacement part for P/N A 102 021 N and FAA-approved installation instructions and install the replacement part. Use the contact information found in paragraph (i)(4) to contact the manufacturer.

(iii) As of November 27, 2000 (the effective date retained from AD 2000-20-11), do not install, on any glider, a P/N A 102 021 N attachment fitting that has not passed the inspection required in paragraph (f)(1)(i) of this AD.

(2) Model L-13 AC Blanik gliders:

(i) Within the next 60 days after July 8, 2016 (the effective date of this AD), inspect the tail-fuselage attachment fitting, P/N A 102 021 N, for damage and material hardness following the procedures in LET Mandatory Bulletin No.: L13/085a, dated November 17, 1999.

(ii) If you find the tail-fuselage attachment fitting is damaged or the material does not meet the hardness requirements specified in the service bulletin during the inspection required in paragraph (f)(2)(i) of this AD, before further flight, you must contact the manufacturer to obtain an FAA-approved replacement part for P/N A 102 021 N and FAA-approved installation instructions and install the replacement part. Use the contact information found in paragraph (i)(4) to contact the manufacturer.

(iii) As of July 8, 2016 (the effective date of this AD), do not install, on any glider, a P/N A 102 021N attachment fitting that has not passed the inspection required in paragraph (f)(2)(i) of this AD.

(g) Other FAA AD Provisions

The following provisions also apply to this AD:

(1) Alternative Methods of Compliance (AMOCs): The Manager, Standards Office, FAA, has the authority to approve AMOCs for this AD, if requested using the procedures found in 14 CFR 39.19. Send information to ATTN: Jim Rutherford, Aerospace Engineer, FAA, Small Airplane Directorate, 901 Locust, Room 301, Kansas City, Missouri 64106; telephone: (816) 329-4165; fax: (816) 329-4090; email: [email protected] Before using any approved AMOC on any airplane to which the AMOC applies, notify your appropriate principal inspector (PI) in the FAA Flight Standards District Office (FSDO), or lacking a PI, your local FSDO.

(2) Airworthy Product: For any requirement in this AD to obtain corrective actions from a manufacturer or other source, use these actions if they are FAA-approved. Corrective actions are considered FAA-approved if they are approved by the State of Design Authority (or their delegated agent). You are required to assure the product is airworthy before it is returned to service.

(h) Related Information

Refer to MCAI Civil Aviation Authority AD CAA-AD-T-112/1999R1, dated November 23, 1999, for related information. The MCAI can be found in the AD docket on the Internet at: https://www.regulations.gov/#!documentDetail;D=FAA-2016-4231-0003.

(i) Material Incorporated by Reference

(1) The Director of the Federal Register approved the incorporation by reference (IBR) of the service information listed in this paragraph under 5 U.S.C. 552(a) and 1 CFR part 51.

(2) You must use this service information as applicable to do the actions required by this AD, unless the AD specifies otherwise.

(3) The following service information was approved for IBR on November 27, 2000 (65 FR 60845, October 13, 2000).

(i) LET Mandatory Bulletin No.: L13/085a, dated November 17, 1999.

(ii) Reserved.

(4) For service information identified in this AD, contact BLANIK LIMITED, 2nd Floor Beaux Lane House, Mercer Street Lower, Dublin 2, Republic of Ireland; phone: +420 733 662 194; email: [email protected]; Internet: http://www.blanik.aero/%EF%BB%BFcustomer_support.

(5) You may view this service information at the FAA, Small Airplane Directorate, 901 Locust, Kansas City, Missouri 64106. For information on the availability of this material at the FAA, call (816) 329-4148. In addition, you can access this service information on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2016-4231.

(6) You may view this service information that is incorporated by reference at the National Archives and Records Administration (NARA). For information on the availability of this material at NARA, call 202-741-6030, or go to: http://www.archives.gov/federal-register/cfr/ibr-locations.html.

Issued in Kansas City, Missouri, on May 23, 2016. Pat Mullen, Acting Manager, Small Airplane Directorate, Aircraft Certification Service.
[FR Doc. 2016-12608 Filed 6-2-16; 8:45 am] BILLING CODE 4910-13-P
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION 14 CFR Part 1274 [NFS Case 2015-N014] RIN 2700-AE25 Cooperative Agreements With Commercial Firms AGENCY:

National Aeronautics and Space Administration.

ACTION:

Final rule.

SUMMARY:

NASA is issuing a final rule amending its regulation on Cooperative Agreements with Commercial Firms to implement section 872 of the National Defense Authorization Act for Fiscal Year 2009. The revision is part of NASA's retrospective plan under Executive Order (EO) 13563 completed in August 2011.

DATES:

Effective: July 5, 2016.

FOR FURTHER INFORMATION CONTACT:

Barbara Orlando, telephone (202) 358-3911.

SUPPLEMENTARY INFORMATION:

I. Background

This final rule implements the requirements of section 872 for recipients and NASA staff to report information that will appear in the Federal Awardee Performance and Integrity Information System (FAPIIS). Pursuant to section 872, NASA will consider information contained within the system about a non-Federal entity before awarding a grant or cooperative agreement to that non-Federal entity. The rule also addresses how FAPIIS and other information may be used in assessing recipient integrity. The major elements of the rule are summarized as follows:

• NASA is to report information in FAPIIS about—

Any termination of an award due to a material failure to comply with the award terms and conditions;

Any administrative agreement with a non-Federal entity to resolve a suspension or debarment proceeding; and

Any finding that a non-Federal entity is not qualified to receive a given award, if the finding is based on criteria related to the non-Federal entity's integrity or prior performance under Federal awards and it is anticipated that the total Federal funding will exceed the simplified threshold during the period of performance.

• Recipients that have Federal contract, grant, and cooperative agreement awards with a cumulative total value greater than $10,000,000 must enter information in FAPIIS about certain civil, criminal, and administrative proceedings that reached final disposition within the most recent five year period and that were connected with the award or performance of a Federal award.

• Recipients that have been awarded a Federal contract, grant, and cooperative agreement with a cumulative total value greater than $10,000,000 are required to disclose semiannually the information about the criminal, civil, and administrative proceedings as described in section 872(c).

• Federal awarding agencies, prior to making an award to a non-Federal entity, must review FAPIIS to determine whether that non-Federal entity is qualified to receive the Federal award. In making the determination, NASA must take into consideration any information about the entity that is in FAPIIS.

• Notice of funding opportunities and Federal award terms and conditions to inform a non-Federal entity that it may submit comments in FAPIIS about any information that NASA had reported to the system about the non-Federal entity, for consideration by NASA in making future Federal awards to the non-Federal entity.

NASA published a proposed rule in Federal Register on Feb. 22, 2016, to revise 14 CFR part 1274 to implement Section 872 of the Duncan Hunter National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2009 (Pub. L. 110-417, codified as amended at 41 U.S.C. 2313, as it applies to cooperative agreements.

II. Discussion and Analysis

On February 22, 2016, NASA published a proposed rule in the Federal Register (81 FR 8671) and received a comment from one respondent. NASA reviewed the comment in the formation of the final rule and determined that the comment was not within the scope of the regulation. No revisions to the proposed rule were made as a result of the public comment received.

III. Executive Orders 12866 and 13563

Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). E.O. 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This is not a significant regulatory action and, therefore, was not subject to review under section 6(b) of E.O. 12866, Regulatory Planning and Review, dated September 30, 1993. This rule is not a major rule under 5 U.S.C. 804.

IV. Paperwork Reduction Act

The Paperwork Reduction Act (Pub. L. 104-13) does not apply because this final rule does not contain any information collection requirements that require the approval of the Office of Management and Budget under 44 U.S.C. 3501, et seq.

List of Subjects in 14 CFR Part 1274 Federal financial assistance.

Manuel Quinones, Federal Register Liaison.

Accordingly, 14 CFR part 1274 is amended as follows:

PART 1274—COOPERATIVE AGREEMENTS WITH COMMERCIAL FIRMS 1. The authority citation for 14 CFR part 1274 is revised to read as follows: Authority:

51 U.S.C. 20113(e) and 31 U.S.C. 6301 to 6308; 51 U.S.C. 20102, et seq.

2. Amend § 1274.203 by adding paragraph (g) to read as follows:
§ 1274.203 Solicitations/cooperative agreement notices.

(g) If NASA anticipates that the total Federal share of any award made under a funding agreement may exceed, over the period of performance, the simplified acquisition threshold, the notice of funding opportunity must include the information as required in Appendix 1 to Part 200, paragraph E.3, paragraph E.4, and paragraph F.3.

3. Amend § 1274.209 by redesignating paragraphs (e) through (l) as (f) through (m), respectively and adding a new paragraph (e) to read as follows:
§ 1274.209 Evaluation and selection.

(e)(1) Prior to making a Federal award, agreement officers are required by 31 U.S.C. 3321 and 41 U.S.C. 2313 note, to review information available through any OMB-designated repositories of governmentwide eligibility qualification, currently the System of Award Management (SAM), or financial integrity information (currently Federal Awardee Performance and Integrity Information System (FAPIIS)), as appropriate. See also suspension and debarment requirements at 2 CFR part 180 as well as individual Federal agency suspension and debarment regulations in title 2 of the Code of Federal Regulations.

(2) In accordance with 41 U.S.C. 2313, agreement officers are required to review the non-public segment of FAPIIS prior to making a Federal award where the Federal share is expected to exceed the simplified acquisition threshold, defined in 41 U.S.C. 134, over the period of performance. At a minimum, the information in the system for a prior Federal award recipient must demonstrate a satisfactory record of executing programs or activities under Federal grants, cooperative agreements, or procurement awards; and integrity and business ethics. NASA may make a Federal award to a recipient who does not fully meet these standards, if it is determined that the information is not relevant to the current Federal award under consideration or there are specific conditions that can appropriately mitigate the effects of the non-Federal entity's risk in accordance with 2 CFR 200.207, Specific conditions.

4. Amend § 1274.211 by: a. In paragraph (c), removing “Central Contractor Registration (CCR)” and adding “System for Award Management (SAM)” in its place; removing “Department of Defense (DOD) Central Contractor Registration (CCR)” and adding “System for Award Management” in its place; removing “CCR” and adding “SAM” in its place; and removing “http://www.ccr2000.com or by calling toll free: 888-227-2423, commercial: 616-961-5757” and adding “https://www.sam.gov” in its place; and b. Adding paragraph (d)(5) to read as follows:
§ 1274.211 Award procedures.

(d) * * *

(5) The non-Federal entity or applicant for a Federal award must disclose, in a timely manner, in writing to the assigned agreement officer or pass-through entity all violations of Federal criminal law involving fraud, bribery, or gratuity violations potentially affecting the Federal award. Non-Federal entities that have received a Federal award including the term and condition outlined in Appendix XII—Award Term and Condition for Recipient Integrity and Performance Matters are required to report certain civil, criminal, or administrative proceedings to SAM. Failure to make required disclosures can result in any of the remedies described in § 200.338 Remedies for noncompliance, including suspension or debarment. (See also 2 CFR part 180, 31 U.S.C. 3321, and 41 U.S.C. 2313.)

5. Amend § 1274.212 by revising the section heading and adding paragraph (c) to read as follows:
§ 1274.212 Award information.

(c) Recipient integrity and performance matters. If the total Federal share of the Federal award is more than $500,000 over the period of performance, agreement officers must include the terms and conditions in § 1274.944 of this chapter.

6. Amend subpart 1274.3 by adding new §§ 1274.303 and 1274.304 to read as follows:
§ 1274.303 Public access to Federal award information.

(a) In accordance with statutory requirements for Federal spending transparency (e.g., FFATA), except as noted in this section, for applicable Federal awards NASA must announce all Federal awards publicly and publish the required information at www.USAspending.gov.

(b) All information posted in FAPIIS, accessible through SAM, on or after April 15, 2011 will be publicly available after a waiting period of 14 calendar days, except for—

(1) Past performance reviews required by Federal Government contractors in accordance with the Federal Acquisition Regulation (FAR) 42.15;

(2) Information that was entered prior to April 15, 2011; or

(3) Information that is withdrawn during the 14-calendar day waiting period by the Federal Government official.

(c) Nothing in this section may be construed as requiring the publication of information otherwise exempt under the Freedom of Information Act (5 U.S.C. 552), or controlled unclassified information pursuant to Executive Order 13556.

§ 1274.304 Reporting a determination that a non-Federal entity is not qualified for a Federal award.

(a) If NASA does not make a Federal award to a non-Federal entity because the agreement officer determines that the non-Federal entity does not meet either or both of the minimum qualification standards, as described in paragraph (a)(2) of 2 CFR 200.205, the agreement officer must report that determination in FAPIIS, accessible through SAM, only if all of the following apply:

(1) The only basis for the determination described in paragraph (a) of this section is the non-Federal entity's prior record of executing programs or activities under Federal awards or its record of integrity and business ethics, as described in paragraph (a)(2) of 2 CFR 200.205, (i.e., the entity was determined to be qualified based on all factors other than those two standards); and

(2) The total Federal share of the Federal award that otherwise would be made to the non-Federal entity is expected to exceed the simplified acquisition threshold over the period of performance.

(b) Agreement officers are not required to report a determination that a non-Federal entity is not qualified for a Federal award if they make the Federal award to the non-Federal entity and includes specific award terms and conditions (see § 1274.209).

(c) If the agreement officer reports a determination that a non-Federal entity is not qualified for a Federal award, as described in paragraph (a) of this section, the agreement officer also must notify the non-Federal entity that—

(1) The determination was made and reported to FAPIIS, accessible through SAM, and include with the notification an explanation of the basis for the determination;

(2) The information will be kept in the system for a period of five years from the date of the determination, as required by section 872 of Public Law 110-417, as amended (41 U.S.C. 2313), then archived;

(3) Agreement officers making a Federal award to the non-Federal entity during that five year period must consider the information found in FAPIIS when judging whether the non-Federal entity is qualified to receive the Federal award when the total Federal share of the Federal award is expected to include an amount of Federal funding in excess of the simplified acquisition threshold over the period of performance of the award;

(4) The non-Federal entity may go to the awardee integrity and performance portal accessible through SAM (currently the Contractor Performance Assessment Reporting System (CPARS)) and comment on any information the system contains about the non-Federal entity itself; and

(5) Agreement officers will consider that non-Federal entity's comments in determining whether the non-Federal entity is qualified for a future Federal award.

(d) If the agreement officer enters information into FAPIIS about a determination that a non-Federal entity is not qualified for a Federal award and subsequently—

(1) Learns that any of that information is erroneous, the agreement officer must correct the information in the system within three business days; and

(2) Obtains an update to that information that could be helpful to other Federal awarding agencies, the agreement officer is strongly encouraged to amend the information in the system to incorporate the update in a timely way.

(e) The agreement officer shall not post any information that will be made publicly available in the non-public segment of designated integrity and performance system that is covered by a disclosure exemption under the Freedom of Information Act. If the recipient asserts within seven calendar days to NASA that some or all of the information made publicly available is covered by a disclosure exemption under the Freedom of Information Act, agreement officers must remove the posting within seven calendar days of receiving the assertion. Prior to reposting the releasable information, agreement officers must resolve the issue in accordance with the agency's Freedom of Information Act procedures.

7. Amend § 1274.701 by adding paragraphs (b)(5) through (b)(8), (c), and (d) to read as follows:
§ 1274.701 Suspension or termination.

(b) * * *

(5) When NASA terminates a Federal award prior to the end of the period of performance due to the non-Federal entity's material failure to comply with the Federal award terms and conditions, NASA must report the termination in FAPIIS.

(6) The information required under paragraph (b) of this section is not to be reported to designated integrity and performance system until the non-Federal entity either—

(i) Has exhausted its opportunities to object or challenge the decision, see § 200.341 Opportunities to object, hearings and appeals; or

(ii) Has not, within 30 calendar days after being notified of the termination, informed the agreement officer that it intends to appeal the decision to terminate.

(7) If the agreement officer, after entering information into FAPIIS about a termination, subsequently:

(i) Learns that any of that information is erroneous, the agreement officer must correct the information in the system within three business days;

(ii) Obtains an update to that information that could be helpful to other Federal awarding agencies, the agreement officer is strongly encouraged to amend the information in the system to incorporate the update in a timely way.

(8) Agreement officers shall not post any information that will be made publicly available in the non-public segment of designated integrity and performance system that is covered by a disclosure exemption under the Freedom of Information Act. If the non-Federal entity asserts within seven calendar days to the Federal awarding agency who posted the information that some of the information made publicly available is covered by a disclosure exemption under the Freedom of Information Act, agreement officers must remove the posting within seven calendar days of receiving the assertion. Prior to reposting the releasable information, agreement officers must resolve the issue in accordance with the agency's Freedom of Information Act procedures.

(c) When a Federal award is terminated or partially terminated, both NASA or the pass-through entity and the non-Federal entity remain responsible for compliance with the closeout and post-closeout requirements and continuing responsibilities.

(d) Notification of termination requirement. If the Federal award is terminated for the non-Federal entity's material failure to comply with the Federal statutes, regulations, or terms and conditions of the Federal award, the notification must state that—

(1) The termination decision will be reported in FAPIIS, accessible through SAM;

(2) The information will be available in FAPIIS for a period of five years from the date of the termination, then archived;

(3) When considering making a Federal award to the non-Federal entity during that five year period, NASA must consider that information in judging whether the non-Federal entity is qualified to receive the Federal award, when the Federal share of the Federal award is expected to exceed the simplified acquisition threshold over the period of performance;

(4) The non-Federal entity may comment on any information that the OMB-designated integrity and performance system contains about the non-Federal entity for future consideration by NASA. The non-Federal entity may submit comments to the awardee integrity and performance portal accessible through SAM (currently (CPARS).

(5) Agreement officers will consider non-Federal entity comments when determining whether the non-Federal entity is qualified for a future Federal award.

8. Add § 1274.803 to read as follows:
§ 1274.803 Suspension and Debarment.

Non-federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180, adopted by NASA at 2 CFR part 1880. These regulations restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities.

9. Amend subpart 1274.9 by adding § 1274.944 to read as follows:
§ 1274.944 Award term and condition for recipient integrity and performance matters.

(a) Reporting of matters related to recipient integrity and performance—(1) General reporting requirement. (i) If the total value of your currently active grants, cooperative agreements, and procurement contracts from all Federal awarding agencies exceeds $10,000,000 for any period during the period of performance of this Federal award, then you as the recipient during that period of time must maintain the currency of information reported in FAPIIS about civil, criminal, or administrative proceedings described in paragraph (a)(2) of this section. This is a statutory requirement under section 872 of Public Law 110-417, as amended (41 U.S.C. 2313).

(ii) As required by section 3010 of Public Law 111-212, all information posted in FAPIIS on or after April 15, 2011, except past performance reviews required for Federal procurement contracts, will be publicly available.

(2) Proceedings about which you must report. Submit the information required about each proceeding that—

(i) Is in connection with the award or performance of a grant, cooperative agreement, or procurement contract from the Federal Government;

(ii) Reached its final disposition during the most recent five year period; and

(iii) Is one of the following:

(A) A criminal proceeding that resulted in a conviction, as defined in paragraph (a)(5)(ii) of this section.

(B) A civil proceeding that resulted in a finding of fault and liability and payment of a monetary fine, penalty, reimbursement, restitution, or damages of $5,000 or more.

(C) An administrative proceeding, as defined in paragraph (a)(5)(i) of this award term and condition, that resulted in a finding of fault and liability and your payment of either a monetary fine or penalty of $5,000 or more or reimbursement, restitution, or damages in excess of $100,000.

(D) Any other criminal, civil, or administrative proceeding if—

(1) It could have led to an outcome described in paragraph (a)(2)(iii)(A), (B), or (C) of this section;

(2) It had a different disposition arrived at by consent or compromise with an acknowledgment of fault on your part; and

(3) The requirement in this award term and condition to disclose information about the proceeding does not conflict with applicable laws and regulations.

(3) Reporting procedures. Enter in the SAM Entity Management area the information that SAM requires about each proceeding described in paragraph (a)(4) of this section. You do not need to submit the information a second time under assistance awards that you received if you already provided the information through SAM, because you were required to do so under Federal procurement contracts that you were awarded.

(4) Reporting frequency. During any period of time when you are subject to the requirement in paragraph (a)(1) of this section, you must report proceedings information through SAM for the most recent five year period, either to report new information about any proceeding(s) that you have not reported previously or affirm that there is no new information to report. Recipients that have Federal contract, grant, and cooperative agreement awards with a cumulative total value greater than $10,000,000 must disclose semiannually any information about the criminal, civil, and administrative proceedings.

(5) Definitions. For purposes of this section:

(i) Administrative proceeding means a non-judicial process that is adjudicatory in nature in order to make a determination of fault or liability (e.g., Securities and Exchange Commission Administrative proceedings, Civilian Board of Contract Appeals proceedings, and Armed Services Board of Contract Appeals proceedings). This includes proceedings at the Federal and State level but only in connection with performance of a Federal contract or grant. It does not include audits, site visits, corrective plans, or inspection of deliverables.

(ii) Conviction, for purposes of this award term and condition, means a judgment or conviction of a criminal offense by any court of competent jurisdiction, whether entered upon a verdict or a plea, and includes a conviction entered upon a plea of nolo contendere.

(6) Total value of currently active grants, cooperative agreements, and procurement contracts includes—

(i) Only the Federal share of the funding under any Federal award with a recipient cost share or match; and

(ii) The value of all expected funding increments under a Federal award and options, even if not yet exercised.

(b) [Reserved]

[FR Doc. 2016-12850 Filed 6-2-16; 8:45 am] BILLING CODE 7510-13-P
DEPARTMENT OF COMMERCE Bureau of Industry and Security 15 CFR Parts 734, 740, 750, and 772 [Docket No. 141016858-6004-02] RIN 0694-AG32 Revisions to Definitions in the Export Administration Regulations AGENCY:

Bureau of Industry and Security, Commerce.

ACTION:

Final rule.

SUMMARY:

This final rule is part of the Administration's Export Control Reform (ECR) Initiative. The Initiative will enhance U.S. national and economic security, facilitate compliance with export controls, update the controls, and further the goal of reducing unnecessary regulatory burdens on U.S. exporters. As part of this effort, the Bureau of Industry and Security (BIS), in publishing this rule, makes revisions to the Export Administration Regulations (EAR) to include certain definitions to enhance clarity and consistency with terms also found in the International Traffic in Arms Regulations (ITAR), which is administered by the Department of State, Directorate of Defense Trade Controls (DDTC), or that DDTC expects to publish in proposed rules. This final rule also revises the Scope part of the EAR to update and clarify application of controls to electronically transmitted and stored technology and software, including by way of cloud computing. DDTC is concurrently publishing comparable amendments to certain ITAR definitions for the same reasons. Finally, this rule makes conforming changes to related provisions.

DATES:

This rule is effective September 1, 2016.

ADDRESSES:

Although there is no formal comment period, public comments on this final rule are welcome on a continuing basis. You may submit comments by either of the following methods:

• By email directly to [email protected]. Include RIN 0694-AG32 in the subject line.

• By mail or delivery to Regulatory Policy Division, Bureau of Industry and Security, U.S. Department of Commerce, Room 2099B, 14th Street and Pennsylvania Avenue NW., Washington, DC 20230. Refer to RIN 0694-AG32.

Commerce's full plan for retrospective regulatory review can be accessed at: http://open.commerce.gov/news/2011/08/23/commerce-plan-retrospective-analysis-existing-rules.

FOR FURTHER INFORMATION CONTACT:

For questions on application of controls to electronically transmitted and stored technology and software, contact Bob Rarog, Senior Advisor to the Assistant Secretary for Export Administration, Bureau of Industry and Security at (202) 482-9089. For other questions, contact Hillary Hess, Director, Regulatory Policy Division, Office of Exporter Services, Bureau of Industry and Security at (202) 482-2440 or [email protected].

SUPPLEMENTARY INFORMATION: Background

This final rule is part of the Administration's Export Control Reform (ECR) Initiative. The Initiative will enhance U.S. national and economic security, facilitate compliance with export controls, update the controls, and continue the process of reducing unnecessary regulatory burdens on U.S. exporters. As part of this effort, the Bureau of Industry and Security (BIS), in publishing this rule, makes revisions to the Export Administration Regulations (EAR) to include the definitions of “access information,” “technology,” “required,” “foreign person,” “proscribed person,” “published,” results of “fundamental research,” “export,” “reexport,” “release,” “transfer,” and “transfer (in-country)” to enhance clarity and consistency with terms also found in the International Traffic in Arms Regulations (ITAR), which is administered by the Department of State, Directorate of Defense Trade Controls (DDTC). This final rule also revises the Scope part of the EAR to update and clarify application of controls to electronically transmitted and stored technology and software. DDTC is concurrently publishing comparable amendments to the ITAR's definitions of “export,” “reexport,” “release,” and “retransfer” for the same reasons. Finally, this rule makes conforming changes to related provisions. DDTC anticipates publishing its comparable provisions pertaining to “technical data,” “directly related,” “public domain,” and the results of “fundamental research” in a separate proposed rule.

One aspect of the ECR Initiative includes amending the export control regulations to facilitate enhanced compliance while reducing unnecessary regulatory burdens. For similar national security, foreign policy, including human rights, reasons, the EAR and the ITAR each control, inter alia, the export, reexport, and in-country transfer by U.S. and foreign persons of commodities, products or articles, technology, technical data, software, and services to various destinations, end users, and end uses. The two sets of regulations have been issued pursuant to different statutes, have been administered by different agencies with missions that are distinct from one another in certain respects, and have covered different items (or articles). For those reasons, and because each set of regulations has evolved separately over decades without much coordination between the two agencies regarding their structure and content, they often use different words, or the same words differently, to accomplish similar regulatory objectives.

Many parties' export, reexport, and transfer transactions are regulated by both the Commerce Department's EAR and the State Department's ITAR, particularly now that regulatory jurisdiction over many types of military items has been transferred from the ITAR to the EAR. Using common terms and common definitions to regulate the same types of items or actions will facilitate enhanced compliance and reduce unnecessary regulatory burdens. Conversely, if different concerns between the two sets of export control regulations warrant different terms or different controls, the differences should be made clear for the same reason. Such clarity will benefit national security because it will be easier for exporters to comply with the regulations and for prosecutors to prosecute violations of the regulations. Such clarity will also enhance our economic security because it will reduce unnecessary regulatory burdens for exporters when attempting to determine the meaning of key words and phrases across similar sets of regulations. Finally, this rule and the rule DDTC is publishing concurrently address only a portion of the terms and phrases that warrant harmonization between the ITAR and the EAR. They are nonetheless a significant step toward accomplishing one of the ultimate objectives of the ECR initiative, which is the creation of a common export control list and common set of export control regulations.

Proposed Rule

On June 3, 2015, BIS published a proposed rule entitled “Revisions to Definitions in the Export Administration Regulations” (80 FR 31505) (hereafter “the June 3 proposed rule” or “the June 3 rule”). Simultaneously, the Department of State published a proposed rule entitled “International Traffic in Arms: Revisions to Definitions of Defense Services, Technical Data, and Public Domain; Definition of Product of Fundamental Research; Electronic Transmission and Storage of Technical Data; and Related Definitions” (80 FR 31525) (hereafter “the State June 3 rule”).

BIS welcomed comments on all aspects of the June 3 rule. Additionally, in the preamble to the June 3 rule, BIS specifically solicited public comment with questions on eight issues. Two of those questions pertained to the definition of fundamental research; one pertained to whether the questions and answers in Supplement No. 1 to part 734 had criteria that should be retained in part 734; two pertained to encryption standards in the definition of “Activities that are Not Exports, Reexports, or Transfers;” and one pertained to the effectiveness of the proposed definition of “peculiarly responsible.” Public comments on these questions are addressed in their corresponding sections below.

The two remaining questions were broadly applicable across the rule: Whether the proposed revisions created gaps, overlaps, or contradictions between the EAR and the ITAR or among various provisions within the EAR; and whether a 30-day delayed effective date was appropriate for the final rule.

Eleven commenters cited the difference between the EAR and ITAR standards for prepublication review of research as a significant gap between the two bodies of regulations that would create compliance difficulties. These commenters recommended that both final rules adopt the EAR standard. Further discussion of this issue may be found in the section of the preamble describing fundamental research, below.

Twenty-two commenters recommended a six-month delayed effective date from date of publication. Most of these commenters explicitly based the recommendation on the anticipated difficulty created by adoption of differing proposed EAR and ITAR standards for prepublication review of research. State is not publishing revisions to fundamental research at this time; therefore, the rationale for requesting a six-month delay is largely eliminated.

One commenter recommended at least a three-month delayed effective date to enable non-U.S. companies to understand and prepare for compliance with the revisions. BIS accepts this recommendation, and this final rule will be effective 90 days from the date of publication.

One commenter recommended issuing an interim final rule with a comment period of at least 60 days due to the breadth of the proposed changes. BIS does not accept this recommendation, because this final rule has a 90-day delayed effective date, which is a longer delay than generally applies to an interim final rule. The State rule published concurrently with this final rule also has a 90-day delayed effective date. Moreover, the State Department plans to publish a second proposed rule seeking comment on most of the terms at issue.

Frequently Asked Questions

Objectives of this final rule include streamlining, clarifying, and updating regulatory text. BIS has attempted to focus the regulatory text on control criteria, limiting notes and examples to those necessary to adequately convey the criteria. Many public comments raised questions about how criteria would be applied in particular situations or suggested illustrative revisions. BIS considers these comments helpful to compliance with the EAR and is publishing them along with responses on the BIS Web site as Frequently Asked Questions (FAQs).

Items Subject to the EAR

The June 3 rule proposed re-titling the section “Subject to the EAR” (from “Important EAR terms and principles”), retaining the definition and description of that term, and creating separate sections in part 734 to define “export,” “reexport,” “release,” and “transfer (in-country),” rather than retaining them in that section. The June 3 rule also proposed removing § 734.2(b)(7) regarding the listing of foreign territories and possessions in the Commerce Country Chart (Supplement No. 1 to part 738) because it duplicated existing § 738.3(b).

BIS received no comments on its proposed revisions to § 734.2. These revisions are adopted in this final rule.

Items Not Subject to the EAR

Section 734.3(a) describes items (i.e., commodities, software, and technology) subject to the EAR. Paragraph (b) describes items that are not subject to the EAR. The June 3 rule proposed minor revisions to paragraph (b)(3), which describes software and technology that are not subject to the EAR, to describe more fully educational and patent information that are not subject to the EAR, and to add a note to make explicit that information that is not “technology” as defined in the EAR is per se not subject to the EAR. One commenter specifically offered support for inclusion of the note, and no commenters objected to it; BIS has adopted it in this final rule.

Educational Information

The June 3 rule proposed to move the statement in § 734.9 that educational information released by instruction in a catalog course or associated teaching laboratory of an academic institution is not subject to the EAR to § 734.3(b) and remove § 734.9. The June 3 rule also proposed to revise the description of such educational information as information and software that “[c]oncern general scientific, mathematical, or engineering principles commonly taught in schools, and released by instruction in a catalog course or associated teaching laboratory of an academic institution” to better match the existing ITAR description. The proposed revisions were not intended to change the scope of educational information that is not subject to the EAR.

Twenty-seven commenters stated that, in spite of BIS's declared intent to leave the scope of this provision unchanged, the proposed revision in fact narrowed the scope of educational information that is not subject to the EAR. With the adoption of the terms in the comparable ITAR provision, such as “general” and “commonly,” commenters said that the revision could be read to make courses with advanced or novel content subject to the EAR and suggested either changing “and released by instruction” to “or released by instruction” or reverting to the existing wording. BIS agrees that the revision could be read to narrow the scope of the exclusion, and because this narrowing was not intended, reverts to the existing wording in this final rule.

BIS received no comments on the placement of the educational information provision in the list of information that is per se not subject to the EAR rather than in a separate section. BIS adopts the proposed placement in this final rule.

Additional Exclusions

This final rule adopts two additional revisions that were not in § 734.3(b)(3) in the June 3 proposed rule. This final rule adds paragraphs (b)(3)(v) and (vi), two additional exclusions from the EAR: Items that are non-proprietary system descriptions or are telemetry data. These two exclusions appeared in the June 3 proposed rule as exclusions from the definition of technology. For discussion of public comments on these exclusions and BIS's response to those comments, see the section on “Technology” below.

Exports of Encryption Source Code Notes

The June 3 rule proposed no changes to the notes to paragraphs (b)(2) and (b)(3) of § 734.3 that a printed book or other printed material setting forth encryption source code is not itself subject to the EAR, but that encryption source code in electronic form or media remains subject to the EAR. It also proposed no changes to the note that publicly available encryption object code software classified under Export Control Classification Number (ECCN) 5D002 is not subject to the EAR when the corresponding source code meets the criteria specified in § 740.13(e) of the EAR.

BIS received no comments on these notes, and this final rule makes no changes to them.

Published Technology and Software

Section 734.7 sets forth that technology and software is “published” and thus not subject to the EAR when it becomes generally accessible to the interested public in any form, including through publication, availability at libraries, patents, distribution or presentation at open gatherings, and public dissemination (i.e., unlimited distribution) in any form (e.g., not necessarily in published form), including posting on the Internet on sites available to the public.

The June 3 rule proposed a definition of “published” that retained the same scope, but with a simpler structure. The proposed § 734.7(a) read: “Except as set forth in paragraph (b), “technology” or “software” is “published” and is thus not “technology” or “software” subject to the EAR when it is not classified national security information and has been made available to the public without restrictions upon its further dissemination,” followed by a list of examples of published information. The proposed definition was substantially the same as the wording of definitions adopted by the multilateral export control regimes of which the United States is a member: The Wassenaar Arrangement on Export Controls for Conventional Arms and Dual-Use Goods and Technologies (herein “Wassenaar Arrangement” or “Wassenaar”), the Nuclear Suppliers Group, the Missile Technology Control Regime, and the Australia Group. The phrase “classified national security information” refers to information that has been classified in accordance with Executive Order 13526, 75 FR 707; 3 CFR 2010 Comp., p. 298. The relevant restrictions do not include copyright protections or generic property rights in the underlying physical medium.

This final rule adopts the definition of “published” from the June 3 proposed rule, with the exception of adding certain information, intended to be published, released to “researchers conducting fundamental research” (see discussion below of “Fundamental Research”). BIS received a number of comments on the definition of “published.” Two commenters found helpful the addressing of Internet posting and the clarification that submission of manuscripts to journal editors constitutes “published.” Commenters requested that BIS define “unclassified” and clarify whether university libraries are “open to the public.” “Unclassified information” refers to information that has not been classified in accordance with Executive Order 13526, 75 FR 707; 3 CFR 2010 Comp., p. 298. University libraries are open to the public. BIS does not implement these requests in this final rule because answering them does not require a change to the regulations. BIS is, however, addressing the questions in FAQs posted on BIS's Web site. One commenter stated that, as proposed, the definition of “published” “suggests that releasing (publishing) technology that is unclassified but subject to the EAR makes that technology no longer subject to the EAR.” One commenter described allowing publication by Internet posting as a “loophole” because the site may be obscure and the duration of posting is not specified. Another commenter warned of “the risk of intentional abuse.” Nonetheless, BIS confirms that technology or software that is “published” as provided in § 734.7 is not subject to the EAR.

A commenter noted that the definition “does not appear to address the case of information posted by someone other than the rightful owner.” BIS agrees with this statement, but notes that such cases are addressed by other laws and regulations.

BIS received thirty comments opposing a provision in the definition of “public domain” in the State June 3 rule to which there is no corresponding provision in the definition of “published.” BIS is making no changes to the EAR in response to these comments because they are outside the scope of this rule. They address concerns with the ITAR, not the EAR.

As adopted in this final rule, section 734.7(b) keeps certain published encryption software subject to the EAR, a restriction that the June 3 rule proposed moving from § 734.7(c) without revision.

Fundamental Research

The June 3 rule proposed revising § 734.8, which excludes most information resulting from fundamental research from the scope of the EAR, but it was not intended to change the scope of the current § 734.8.

Alternative Definitions

In the June 3 proposed rule, BIS specifically solicited comments on whether the alternative definition of fundamental research suggested in the preamble should be adopted. BIS also specifically solicited comments on whether the alternative definition of applied research suggested in the preamble should be adopted, or whether basic and applied research definitions are needed given that they are subsumed by fundamental research.

Issued in 1985, National Security Decision Directive (NSDD)-189 established a definition of “fundamental research” that has been incorporated into numerous regulations, internal compliance regimes, and guidance documents. The June 3 proposed rule contained a definition of “fundamental research” that was identical to that in NSDD-189. However, in the preamble to that rule, BIS provided a simpler definition that was consistent with NSDD-189, but not identical. Specifically, the alternative definition read: “ ‘Fundamental research’ means non-proprietary research in science and engineering, the results of which ordinarily are published and shared broadly within the scientific community.” BIS believed that the scope of this wording was the same as that of the wording in NSDD-189 and sought comment on whether the final rule should adopt the simpler wording. Unlike the simpler alternative definition, the proposed definition of “fundamental research” included references to “basic” and “applied” research and proposed definitions of those terms, as well as a possible alternative definition of applied research.

Comments on alternative definitions of fundamental research were mixed. Thirteen commenters generally favored a simpler definition, in some cases offering their own revised versions of the alternative from the preamble to the June 3 proposed rule. Seven commenters recommended retaining the NSDD-189 wording. Many commenters favored one definition but expressed willingness to accept another. Comments on alternative definitions of basic and applied research were similarly mixed, including instances of the same commenter offering support for more than one option. There was greater unanimity on the term “non-proprietary:” twenty commenters objected to it, most finding it vague. Commenters suggested the variation, research “for which the researchers have not accepted restrictions for proprietary or national security reasons.”

BIS agrees with the majority of commenters that the shorter definition of fundamental research is clearer and covers the same scope. Given the wide spectrum of definitions and applications of basic and applied research in different bodies of regulations, BIS determined that the definition should address the core concept, i.e., that the research is to be published and shared broadly without restriction. Having sub-definitions of basic and applied research in the definition of fundamental research does not change this core concept and would, moreover, merely add more words and layers of interpretation that would not change the outcome of an analysis. Adopting the shorter definition drops references to basic and applied research. BIS accepted the comments regarding the term “non-proprietary” and adopted a clearer variation that has the same scope as that intended by the June 3 proposed rule.

In addition to research in science and engineering, BIS included the term “mathematics” to broaden the definition in response to a comment by a BIS technical advisory committee. In this final rule, BIS adopts the following definition of fundamental research: “ “Fundamental research” means research in science, engineering, or mathematics, the results of which ordinarily are published and shared broadly within the research community, and for which the researchers have not accepted restrictions for proprietary or national security reasons.”

Software

The June 3 proposed rule revised § 734.8 to use the term “technology” in place of the term “information.” Thirty-two commenters objected that “technology” was too limiting and recommended including either “software” or “source code” in addition to “technology” to describe information arising during or resulting from fundamental research. Many commenters pointed to the text of § 734.3(b)(3) (not subject to the EAR), which referred to certain “technology and software” not subject to the EAR, proposed to be revised to “information and software” in the June 3 rule, as support for this recommendation. The commenters further argued that “findings resulting from fundamental research may be written in natural-language or computer language.” BIS accepts these comments and has adopted “technology” and “software” throughout § 734.8 in this final rule.

Two commenters recommended that BIS make commodities that result from fundamental research not subject to the EAR. BIS does not accept this recommendation because the policy foundations for the exclusion from the EAR of fundamental research apply only to technology and software, not commodities.

Note on Inputs

The June 3 proposed rule contained the following note: “Note 1 to paragraph (a): The inputs used to conduct fundamental research, such as information, equipment, or software, are not `technology that arises during or results from fundamental research' except to the extent that such inputs are technology that arose during or resulted from earlier fundamental research.” Six commenters stated that the proposed note arbitrarily narrows the conduct of fundamental research under NSDD-189. Two additional commenters seemed to find the text unclear regarding the nature of the inputs.

The note regarding inputs was intended to distill varying provisions found in the EAR but proposed to be revised by the June 3 rule that ultimately made the same point: Information that is not intended to be published is not fundamental research. For example, existing § 734.8(b)(2) states, “Prepublication review by a sponsor of university research solely to insure that the publication would not inadvertently divulge proprietary information that the sponsor has furnished to the researchers does not change the status of the research as fundamental research. However, release of information from a corporate sponsor to university researchers where the research results are subject to prepublication review, is subject to the EAR.” Existing section 734.8(b)(4) states, “The initial transfer of information from an industry sponsor to university researchers is subject to the EAR where the parties have agreed that the sponsor may withhold from publication some or all of the information so provided.”

To clarify this distinction, BIS has adopted a simpler note in this final rule. Paragraph (a) establishes that the intention to publish is what makes research not subject to the EAR; the following Note 1 to paragraph (a) states: “This paragraph does not apply to technology or software subject to the EAR that is released to conduct fundamental research.” To support this concept, this final rule adds the following phrase to § 734.7(a)(5) (emphasis added): “Submission of a written composition, manuscript, presentation, computer-readable dataset, imagery, algorithm, formula, or some other representation of knowledge with the intention that such information will be made publicly available if accepted for publication or presentation: (i) To domestic or foreign co-authors, editors, or reviewers of journals, magazines, newspapers, or trade publications; (ii) To researchers conducting fundamental research, or (iii) To organizers of open conferences or other open gatherings.”

Prepublication Review

The June 3 proposed rule listed three types of prepublication review in § 734.8 that could be performed on the results of fundamental research. Three commenters supported the clear statement that certain prepublication review does not render research subject to the EAR. One commenter recommended removing the criterion that the research be published without delay, pointing out that “[p]ublication can be (and very often is) delayed for any number of reasons having nothing to do with the content or sensitivity of research results” and that this provision would have the unintended effect of limiting or even eliminating the researchers' ability to use the fundamental research provisions. BIS accepts this latter comment and does not adopt the phrase “or delay.” The key point is that the researcher is able to publish without restriction.

One commenter suggested that Note 2 to paragraph (b) proposed in the June 3 rule be replaced with a similar note from the State June 3 rule (§ 120.49(b) of the ITAR) regarding research voluntarily subjected to U.S. government review. BIS agrees with commenters that the ITAR text is clearer. So, this final rule adopts that ITAR text in Note 2 to paragraph (b). Seven commenters recommended that BIS also adopt the text of Note 3 from the State June 3 rule's text of § 120.49(b) of the ITAR regarding U.S. government-imposed access and dissemination controls. BIS agrees. With adoption of Note 3 to paragraph (b), paragraph (a) of § 734.11, Specific National Security Controls, is no longer necessary. BIS includes the examples from paragraph (b) of § 734.11, which commenters deemed helpful, in new Note 3 to paragraph (b) of § 734.8 in this final rule. Thus, this rule removes § 734.11 in its entirety.

One commenter stated that the only permissible method of restricting government-funded research was to classify it. BIS does not accept this comment because it is incorrect. Indeed, BIS has the authority under the EAR to control unclassified technology that warrants control for national security, foreign policy, or other reasons. For example, government-funded research that does not meet the criteria of § 734.8, such as prepublication review, remains subject to the EAR regardless of whether it is classified information.

Locus of Research

The June 3 rule proposed streamlining the fundamental research provisions, in § 734.8. Instead of organizing the provisions primarily by locus (specifically by the type of organization in which the research takes place: Universities; federal agencies or Federally Funded Research and Development Centers; or business entities), the June 3 rule proposed consolidating different provisions that involved the same criteria with respect to prepublication review and removing any reference to locus unless it made a difference to the jurisdictional status of the research.

Five commenters expressed support for the applicability of the concept of fundamental research regardless of locus, and this final rule retains the consolidated structure originally proposed.

Although not objecting to the consolidation, eleven commenters requested that BIS retain the § 734.8(b) statement that there is a presumption that university-based research is fundamental research. Although this presumption continues to exist, BIS does not adopt the specific statement in this final rule. Such a presumption has no effect on the jurisdictional status of technology. If it meets the criteria for fundamental research, it is not subject to the EAR; if it does not meet the criteria, it is subject. However, BIS is noting in its FAQs on its Web site that, although university-based research is presumed to be fundamental research, as with all rebuttable presumptions, it is rebutted if the research is not within the scope of technology and software that arises during, or results from fundamental research as described in § 734.8.

Eleven commenters requested that BIS retain the § 734.8(b)(2) through (6) criteria for universities. BIS is not doing so because these criteria have been incorporated into this final rule more concisely. To address the comment, BIS has revised its FAQs to describe how these criteria are within the scope of the revised definition.

Patents

The June 3 rule proposed revising § 734.10, “Patent applications,” only for clarity and did not change the scope of control. For the sake of structural consistency with the ITAR's treatment of information in patents, paragraph (a) was added to state that a patent or an open (published) patent application available from or at any patent office is per se not subject to EAR. The former footnote to the § 734.10 was removed because it would be redundant of the proposed text.

BIS received one comment on the proposed revisions to § 734.10. Introductory text to the section reads: “ “Technology” is not “subject to the EAR” if it is contained in:”. The commenter suggested adding the phrase “any of the following” to this text. BIS agrees and is making the addition to this final rule.

Specific National Security Controls

The June 3 rule proposed minor conforming edits to § 734.11, describing specific national security controls. The proposed revisions were not intended to change the scope of the section. As discussed above with respect to fundamental research, BIS has adopted the substance of former § 734.11, Specific National Security Controls, in new Note 3 to paragraph (b) of § 734.8 in this final rule. This final rule removes and reserves § 734.11.

Export

The June 3 proposed rule included a new § 734.13 to define “Export.” Section 734.13(a) had six paragraphs, with paragraphs (a)(4) and (5) reserved, because the corresponding paragraphs in the ITAR contained provisions that were not relevant to the EAR. One commenter noted that paragraph (a) had a typo and should refer to § 734.18, not § 734.17. BIS does not agree—the reference is to the subset of exports of encryption source code and object code software—but does accept the recommendation to add a reference to § 734.18 (Activities that are not exports, reexports, or transfers) in this final rule.

Proposed paragraph (a)(1) of the definition of “export” used the EAR terms “actual shipment or transmission out of the United States,” combined with the existing ITAR “sending or taking an item outside the United States in any manner.”

One commenter recommended that BIS add “release” after “actual shipment.” BIS does not adopt this recommendation, because release is a separate concept and thus a separately defined term. BIS makes no revisions to this paragraph (a)(1) in this final rule.

Proposed paragraph (a)(2), specifying the concept of transfer or release of technology to a foreign national in the United States, or “deemed export,” retains the treatment of software source code as technology for deemed export purposes from § 734.2(b)(2)(ii). In this final rule, including in this paragraph (a)(2), BIS has substituted the term “foreign person” for “foreign national.” “Foreign person” has the same scope as “foreign national;” it mirrors the ITAR term. One commenter found the term “otherwise transferring” confusing, but this final rule retains it to distinguish releases as a subset of transfers.

Proposed paragraph (a)(3) included in the definition of “export” the transfer by a person in the United States of registration, control, or ownership (i) of a spacecraft subject to the EAR that is not eligible for export under License Exception STA (i.e., spacecraft that provide space-based logistics, assembly or servicing of any spacecraft) to a person in or a national of any other country, or (ii) of any other spacecraft subject to the EAR to a person in or a national of a Country Group D:5 country.

One commenter requested BIS to confirm whether the definition would carve out from the definitions of “export” and “reexport” the mere transfer of ownership to an entity outside of a Country Group D:5 country (e.g., as part of an on orbit transfer of ownership to an entity outside a D:5 country) of satellites subject to the EAR that are eligible for License Exception STA. BIS confirms this understanding of the definition and is adding an FAQ regarding the point to the BIS Web site.

Proposed paragraph (a)(6) defined as an export the release or other transfer of the means of access to encrypted data. This paragraph was not adopted in this final rule (see the section discussing transfer of access information in § 734.19 below). Without a paragraph (a)(6), reserved paragraphs (a)(4) and (a)(5) that appeared in the June 3 rule are unnecessary and, therefore, do not appear in this final rule.

As adopted in this final rule, proposed paragraph (b) of § 734.13 is unchanged from the June 3 rule, except for the substitution of the term “foreign person” for “foreign national.” This paragraph retains BIS's deemed export rule as set forth in § 734.2(b). It also codifies a long-standing BIS policy that when technology or source code is released to a foreign national, the export is “deemed” to occur to that person's most recent country of citizenship or permanent residency. See, e.g., 71 FR 30840 (May 31, 2006).

Four commenters raised deemed export issues, particularly with respect to the difficulty of determining the “permanent residency” status of a person in a foreign country. Two of these commenters recommended changing “permanent residency” to “legal residency” or establishing criteria in the EAR. One of these commenters suggested making deemed exports a separate definition. BIS finds that these comments have merit; however, the issues they raise are too wide-ranging and complex to be resolved in this final rule. Addressing these issues would constitute a novel proposal that is outside the scope of the proposed rule, requiring an opportunity for comment before BIS makes a decision as to whether to adopt it. Where practical, BIS will state existing policy in FAQs. For those issues not addressed by existing policy, BIS will develop proposed revisions and seek public comment.

Proposed paragraph (c) stated that items that will transit through a country or countries or will be transshipped in a country or countries to a new country, or are intended for reexport to the new country are deemed to be destined to the new country. (Proposed paragraph (c) text was taken without change from § 734.2(b)(6).)

One commenter requested that BIS clarify “new country.” BIS accepts this comment, and adopts the term “destination” in this final rule. BIS also drops the term “transshipped,” because the intended meaning of this paragraph is captured by “transit.” One commenter recommended that BIS specify that paragraph (c) applies to items “subject to the EAR.” BIS does not believe the phrase is necessary.

Two commenters requested that BIS clarify the status of services under the EAR. Unlike the ITAR, the EAR do not control services as such except as described in § 744.6(a)(2) (“Restrictions on certain activities of U.S. persons”) and § 736.2(b)(10) (“General Prohibition 10”). Section 744.6(a)(2) imposes licensing requirements on the performance by U.S. persons of any contract, service, or employment regarding various activities pertaining to missiles, biological weapons, and chemical weapons in various countries. General Prohibition 10 prohibits, inter alia, servicing an item subject to the EAR if a violation has occurred, is about to occur, or is intended to occur in connection with the item. Except for these provisions, the EAR regulates the export, reexport, and transfer (in-country) of commodities, technology, and software, regardless of whether such activities are in connection with a service. This means that, except with respect to activities described in these two provisions, services do not need to be analyzed separately for purposes of determining requirements under the EAR. Moreover, the ITAR does not impose controls on services unless they are “directly related” to a “defense article,” i.e., an article, software, or technical data described on the ITAR's U.S. Munitions List at 22 CFR 121.1. In response to the commenters, BIS has added this explanation to its FAQs. A core goal of the ECR initiative was to make the distinctions in the ITAR and the EAR regarding the scope of controls over services as such clear. Thus, after the publication of the FAQs, if commenters believe that provisions of the ITAR or the EAR, statements by government officials, or any other government actions contradict this point regarding the narrow scope of controls over services pertaining to items subject to the EAR, they are encouraged to contact BIS to begin the process of resolving the issue.

Reexport

The June 3 rule proposed moving the definition of “reexport” to new § 734.14. In general, the provisions of the proposed definition of “reexport” paralleled those of the proposed definition of export discussed above, except that reexports occur outside of the United States. Public comments on the definition of “reexport” and BIS responses also mirror those discussed above for “export.”

One commenter recommended that BIS specify “subject to the EAR” in paragraphs (a)(1), (a)(2), and (a)(4) of “reexport.” BIS accepts this recommendation, except for paragraph (a)(4). Paragraph (a)(4) in the June 3 rule proposed to define as a reexport the release or other transfer of the means of access to encrypted data outside of the United States to a foreign national. This paragraph was not adopted in this final rule (see the section discussing transfer of access information in § 734.19 below).

One commenter requested that BIS confirm that sending an item back to the United States is not a reexport. BIS confirms that sending items to the United States is not a “reexport.” Moreover, unlike the ITAR, the EAR have no provisions controlling or otherwise pertaining to the act of importing items into the United States. BIS will confirm these points in an FAQ.

Release

The June 3 proposed rule included a definition of “release” in a new § 734.15. The proposed text provided that inspection (including other types of inspection in addition to visual, such as aural or tactile) must actually reveal technology or source code subject to the EAR to constitute a “release.” Thus, for example, merely seeing an item briefly is not necessarily sufficient to constitute a release of the technology required, for example, to develop or produce it. A foreign person's having theoretical or potential access to technology or software is similarly not a “release” because such access, by definition, does not reveal technology or software. A release would occur when the technology or software is revealed to the foreign person. The June 3 rule also proposed adding “written” to “oral exchanges” in paragraph (a)(2) as a means of release. No commenters objected to the clarification, and it remains unchanged. This final rule adds “source code” as well as “technology” to paragraph (a)(2) for consistency with paragraph (a)(1) and the definitions of deemed export and reexport; its omission from the June 3 rule was inadvertent.

The proposed text also clarified, in paragraph (a)(3), that the application of “technology” and “software” is a “release” in situations where U.S. persons abroad use personal knowledge or technical experience acquired in the United States in a manner that reveals technology or software to foreign nationals. As indicated by various BIS training materials and statements of BIS officials publicly and in response to specific questions, this clarification makes explicit a long-standing BIS interpretation of the EAR. The June 3 rule's proposed definition did not use the existing phrase “visual inspection by foreign nationals of U.S.-origin equipment and facilities” because such inspections do not per se release “technology.” For example, merely seeing equipment does not necessarily mean that the seer is able to glean any technology from it and, in any event, not all visible information pertaining to equipment is necessarily “technology” subject to the EAR.

Four commenters stated that this redefinition of “release” was helpful.

Three comments expressed concern that paragraph (a)(1) is not sufficiently explicit in clarifying that visual inspection must “actually” or “substantively” reveal technology in order to be defined as a “release,” or that “actual access” rather than “theoretical access” is caught. BIS believes that the intent is clear and that the text only would be complicated by additional modifications. One commenter requested that BIS simplify the provision in which application of personal knowledge constitutes a release. Upon further consideration, BIS determined that the control criteria in that provision are already covered by the provisions governing inspection and oral or written exchanges. Therefore, BIS does not adopt this paragraph (a)(3) in this final rule. BIS has, however, created FAQs that include the points and examples contained in the foregoing description of the changes to the definition of “release.”

One commenter recommended that paragraph (a)(6) in the June 3 rule's proposed definition of “export,” which addressed transfer of decryption keys or other such information, be moved to the definition of “release.” Related to the revisions regarding transfer of access information, and consistent with this commenter's recommendation, this final rule adopts in § 734.15(b) a provision stating that the act of causing the “release” of “technology” or “software,” through use of “access information” or otherwise, to onesself or another person requires an authorization to the same extent an authorization would be required to export or reexport such “technology” or “software” to that person.

The purpose of this provision is to make it clear that the person who uses, for example, a password to access a technology database, or who hacks into the database, to transfer technology to himself or someone else is the one who caused the release of technology rather than the person who first placed the technology in the database through a technology export or an act described in new § 734.18(a)(5). This provision codifies that basic concept that the unwitting victim of, for example, a database hack is not the one responsible for the theft of technology—the hacker is the one responsible because it is that person who caused the release through the use of a password or other access information. This provision is merely an application with respect to intangibles of a concept that is basic to tangible items—the export of an item is not the cause of a third person's later reexport of the same item. Placing technology into a database is not the cause of a third person's later transfer of the technology through the use of access information. The third person's use of the access information is the cause of the release to himself or others.

Although the person who originally placed the technology into the database did not cause its release to the third person who used access information to later cause the technology to be released, the person who originally placed the technology into the database nonetheless would have liability in connection with the third party technology exfiltration if, for example, it conspired with the exfiltrator (see § 764.2(d)) or placed the technology into the database with “knowledge” that the exfiltrator would later violate the EAR by causing its release without a required license (see § 764.2(e)). Similarly, liability would arise from a violation of new section 734.19, which, as discussed below, states that providing a password or other access information to someone with “knowledge” that the provision would result in the release of technology or software to the third person is tantamount to releasing the technology or software itself to the third person. BIS has created FAQs describing all the points in the foregoing examples.

Finally, and in contrast to section 734.19, new section 734.15(b) does not contain a “knowledge” element. Thus, a “release” of “technology” or “software” occurs when access information is used to transfer the “technology” or “software”—resulting in liability if the release was not undertaken pursuant to a required authorization and regardless of whether the one using the access information knew it would be transferring controlled “technology” or “software” when it did so.

Transfer (In-Country)

The June 3 rule proposed removing the definition of “transfer (in-country)” from § 772.1 and adding the following revised definition to new § 734.16: “a transfer (in-country) is a change in end use or end user of an item within the same foreign country.” This revision was intended to eliminate any potential ambiguity regarding whether a change in end use or end user within a foreign country is a “transfer (in-country).” “Transfer (in-country)” parallels the term “retransfer” in the ITAR.

Four commenters said that this revision expands controls, and that such changes were beyond exporters' knowledge or control. While BIS acknowledges that “end use” was not explicitly included in the former definition of “transfer (in-country),” a change in end use is nonetheless a material change. When BIS and the other agencies review an application's description of a proposed end use and approve the license based on that end use, BIS is approving the transaction for the end use described, not all other end uses in the same country. Other end uses may or may not be acceptable, but a change in end use from that which the U.S. Government reviewed would be material in that there is the possibility that another end use may not have been approved. BIS further notes that, depending on the facts of the transaction, the foreign party may be responsible for obtaining authorization for the subsequent disposition of the item subject to the EAR. If a violation occurs, BIS will assess responsibility based on whether the parties involved violated any of the provisions of section 764.2 (“violations”).

To assist the commenters and others who have questions about BIS's policy regarding when a license or other authorization is required for in-country transfers, BIS has made the following the standard first condition on its licenses: “Items subject to the EAR and within the scope of this license may not be reexported or transferred (in-country) unless such reexport or in-country transfer is (i) authorized by this license, or another license or other approval issued by the U.S. Government; (ii) authorized by a license exception or other authorization under the Export Administration Regulations (EAR); or (iii) to a destination, end user, and end use that would be “NLR” (No License Required) under the EAR.”

Export of Encryption Source Code and Object Code Software

The June 3 proposed rule included a new § 734.17, export of encryption source code and object code software, that retained the text of § 734.2(b)(9) with only minor conforming and clarifying edits. Its relocation to a new, separate section, following similar definitions improves its accessibility to exporters.

BIS received no comments on its proposed minor revisions to § 734.2(b)(9) or its creation of § 734.17. These revisions are adopted in this final rule.

Activities That Are Not Exports, Reexports, or Transfers

The June 3 proposed rule solicited public comment on two questions regarding the proposed definition of “Activities that are not exports, reexports, or transfers.” First, with respect to end-to-end encryption, BIS asked whether the illustrative standard proposed in the EAR rulemaking also should be adopted in the ITAR rulemaking; whether the safe harbor standard proposed in the ITAR rulemaking also should be adopted in the EAR rulemaking; or whether the two bodies of regulations should have different standards. Second, BIS asked whether encryption standards adequately address data storage and transmission issues with respect to export controls.

As proposed, § 734.18 gathered existing EAR exclusions from exports, reexports, and transfers into one place, and included a new exemption for encrypted technical data and software. A number of changes and adjustments are made in this final rule to the proposed text in response to comments received from the public.

Paragraph (a)(1) in the June 3 proposed rule stated that by statute, launching a spacecraft, launch vehicle, payload, or other item into space is not an export. See 51 U.S.C. 50919(f). BIS received no comments on this paragraph and adopts it in this final rule.

Paragraph (a)(2) in the June 3 proposed rule was based on text in former § 734.2(b)(2)(ii) of the EAR, and provided that release in the United States of technology or software to U.S. nationals, permanent residents, or protected individuals would not be an export. In this final rule, the term “release” has been replaced in § 734.18(a)(2) with “transmitting or otherwise transferring,” and the previous reference to U.S. persons, permanent residents, and protected individuals has been eliminated in favor of a reference to a person “who is not a foreign person” for reasons of clarity and brevity. The EAR contain three definitions of “U.S. person,” only one of which is applicable to this section. Additionally, the ITAR use the term “foreign person,” and a comment from a BIS technical advisory committee recommended adopting the term in the EAR. “Foreign person” accordingly is defined in a new entry in § 772.1.

The change creates a structure parallel to that which is being adopted in the State rule published concurrently with this final rule, and to make clear that transmission from one U.S. person in the United States to another, regardless of the means or route of the transmission, does not constitute an export. Along the same lines, paragraph (a)(3) is added to clarify that the transmission between or among U.S. persons within the same foreign country similarly does not constitute an export, reexport, or transfer. The State June 3 rule received comments recommending these revisions, and this final rule adopts them in the EAR to stay parallel with the ITAR text.

Proposed paragraph (a)(3) in the June 3 rule contained text from § 734.2(b)(8) stating that shipments between or among the states or possessions of the United States are not “exports” or “reexports.” The words “moving” and “transferring” were inserted next to “shipment” in order to avoid suggesting that the only way movement between or among the states or possessions would not be a controlled event was if they were “shipped.” BIS received no comments on this paragraph and adopts it in this final rule, renumbered as paragraph (a)(4).

Paragraph (a)(5)—numbered (a)(4) in the June 3 proposed rule—provides that technology and software that is encrypted in accordance with certain specified criteria are not exports, reexports, or transfers even when they leave one country for another. In the June 3 proposed rule, this paragraph specifically excluded from this carve-out technology and software stored in countries in Country Group D:5 and Russia, for foreign policy reasons. In response to comments pointing out that Internet traffic in transit across D:5 countries and Russia may be technically “stored” temporarily on servers located in these countries without the knowledge of the sender, BIS has added text in (a)(5) specifying that the carve-out continues to apply to technology not authorized under the EAR for storage in these countries or intended for storage in these countries. Encrypted data may not be stored in these countries unless an appropriate authorization is available or has been approved. BIS has also added a note clarifying that data in-transit via the Internet is not deemed to be stored. For a more complete understanding of § 734.18(a)(5), see the discussion above of § 734.15(b).

BIS received many comments on the proposed definition of “end-to-end encryption,” the presence of which is a condition of the export control carve-out for technology and software. Commenters observed that encryption and decryption services may be provided within defined security boundaries by organizational rather than personal systems or servers. BIS agrees that in such cases, the security objectives of the “end-to-end” requirement in terms of eliminating access by third parties can still be met by expanding the definition of “end-to-end” to include transmissions between security boundaries.

This approach has the added advantages of providing more flexibility and allowing the execution of shared services, such as virus scanning, that can enhance security. However, BIS has also specified that the “security boundary” must be in-country—that is, such boundaries cannot be defined as including infrastructure resources encompassing multiple countries. A consequence of this requirement is that data eligible for the carve-out must by definition be encrypted before crossing any national boundary and must remain encrypted at all times while being transmitted from one security boundary to another. This principle applies to transmissions within a cloud service infrastructure, where a transmission from one node or cloud infrastructure element to another could qualify for the carve-out provided that it was appropriately encrypted before any data crossed a national border.

The June 3 proposed rule's definition of end-to-end encryption included a clause that specified that data not be decrypted at any point between the initiation of the transmission by the originator and its receipt by the intended recipient. The purpose of this requirement was to prevent unauthorized access to data in clear text by parties other than the originator (or the originator's company or organization) and the recipient, such as external service providers.

Commenters pointed out that in many circumstances, companies and organizations encrypt and decrypt multiple times in the course of transmission between originator and recipient for technical reasons (for example, to initially establish communications with a VPN server and subsequently to transmit among servers) without release to any third party. As a result, the point-to-point requirement in the original proposal would impose an unnecessary and potentially disruptive burden on many encryption applications, in which data in clear text are never actually shared.

To address this problem and more precisely describe BIS's original intent with the provision, BIS eliminated the statement in the end-to-end definition specifying that exempted data must be encrypted by the originating party without decryption except by the intended recipient. This final rule adopts instead a requirement that the means of decryption may not be provided to any third party, thus permitting decryption and re-encryption within the security boundary of either the originator or recipient, provided that no third party (i.e., a party outside the security boundary) has the ability to access the data in clear text, and that no decryption takes place outside of the security boundaries of the originator and the recipient.

The June 3 proposed rule's paragraph (4)(iii), which this final rule adopts in paragraph (5)(iii), described encryption standards that would qualify for the exemption. In the BIS proposed rule, use of encryption modules certified under the Federal Information Processing Standards Publication 140-2 (FIPS 140-2), supplemented by appropriate software implementation, cryptographic key management and other procedures or controls that are in accordance with guidance provided in current U.S. National Institute for Standards and Technology publications, would qualify as sufficient security.

A number of commenters questioned the designation of the FIPS 140-2 as an example of effective cryptography and thus a qualification for the control carve-out, preferring instead no reference to a standard, or a reference to any “commercially reasonable” standard.

BIS rejects these suggestions. FIPS 140-2 is a well-understood cryptographic standard used for Federal Government procurement in the United States and Canada, as well as for many other uses, both in the U.S. and abroad. Citation of this standard provides a useful reference point for what the U.S. Federal Government considers effective encryption.

The text adopted in this final rule allows for use of “equally or more effective cryptographic means,” meaning that alternative approaches are allowable provided that they work as well as or better than FIPS 140-2. In such cases, the exporter is responsible for ensuring that the alternative approaches work as well as or better than FIPS 140-2, regardless of common commercial practices.

In the June 3 proposed rule, paragraph (c) confirmed that the mere ability to access “technology” or “software” while it is encrypted in a manner that satisfies the requirements in the section does not constitute the “release” or export of such “technology” or “software.” This responds to a common industry question on the issue. This final rule adopts the proposed text with only a minor revision to correct a cross-reference.

Transfer of Access Information

New § 734.18(a)(5)(iii) excludes transfers of information encrypted to a particular standard as not being exports, reexports, or transfers and, thus, not subject to the EAR. Logically, providing keys or other information that would allow access to encrypted data exported, reexported, or released under this provision should be subject to controls much as the export, reexport, or transfer of the data itself. In the June 3 proposed rule, this concept was specifically addressed in proposed § 734.13(a)(6) as part of the definition of “export.” The June 3 rule also proposed adding a new paragraph (l) to § 764.2 “Violations” providing that the unauthorized release of decryption keys or other information that would allow access to particular controlled technology or software would constitute a violation to the same extent as a violation in connection with the export of the underlying controlled “technology” or “software.”

Although recognizing the need to control the decryption of controlled technical data otherwise exempted by the encryption carve-out, commenters noted that this construction might lead to the conclusion that keys and other data permitting access might be controlled as separate stand-alone items, distinct from the underlying data that they could potentially release. This would pose problems with key and identity management, where such data are stored and transmitted separately. Controlling access information as a distinct item was not the intent of the proposal. As also discussed below with respect to the definition of “technology,” one commenter stated that decryption keys and other such information are not technology and recommended moving the proposed paragraph (a)(5) text to the definition of “release” and control “accessing” them. To address the concerns of such commenters, this final rule creates a new positive authorization requirement in a new § 734.19, stating that “[t]o the extent an authorization would be required to transfer “technology” or “software,” a comparable authorization is required to transfer access information if with “knowledge” that such transfer would result in the release of such “technology” or “software” without a required authorization.” Five commenters found use of the term “cause or permit” inconsistent with BIS's principle of an export's occurring only when actual export or transfer takes place. This final rule replaces the former reference to “cause or permit” with “result in.”

One commenter requested “the removal of § 764.2(l) in its entirety as the current language of § 764.2 is adequate.” With creation of new § 734.19, and in light of the availability of § 764.2 to punish any violation of § 734.19, BIS accepts this comment and does not adopt the proposed § 764.2(l) in this final rule.

To simplify this section, proposed references to “decryption keys, network access codes, passwords and other information,” are replaced with a new § 772.1 definition of “access information,” which uses these as examples only of information that allows access to encrypted technology or encrypted software in an unencrypted format. In response to a commenter's request for a definition of “clear text,” this final rule replaces references to “clear text” with “in an unencrypted form,” as part of the definition of “access information.”

References in the June 3 proposed rule to what is termed “access information” in this final rule (e.g., references to decryption keys) were eliminated in the § 772.1 definition of “technology,” the § 734.13 definition of export, and the § 734.14 definition of reexport.

Activities That Are Not Deemed Reexports

The June 3 proposed rule created a new § 734.20, Activities that are not Deemed Reexports. This section codified BIS's interagency-cleared Deemed Reexport Guidance previously posted on the BIS Web site and dated October 31, 2013. This guidance was created so that the provisions regarding possible deemed reexports contained in §§ 124.16 and 126.18 of the ITAR would be available for EAR technology and source code in addition to legacy BIS guidance on the topic.

Under BIS's legacy guidance and new § 734.20, release of technology or source code by an entity outside the United States to a foreign national of a country other than the foreign country where the release takes place does not constitute a deemed reexport of such technology or source code if the entity is authorized to receive the technology or source code at issue, whether by a license, license exception, or in situations where no license is required under the EAR for such technology or source code and the foreign national's most recent country of citizenship or permanent residency is that of a country to which export from the United States of the technology or source code at issue would be authorized by the EAR either under a license exception, or in situations where no license under the EAR would be required.

Release of technology or source code by an entity outside the United States to a foreign national of a country other than the foreign country where the release takes place also does not constitute a deemed reexport if: (i) The entity is authorized to receive the technology or source code at issue, whether by a license, license exception, or through situations where no license is required under the EAR; (ii) the foreign national is a bona fide regular and permanent employee (who is not a proscribed person) of the entity; (iii) such employee is a national exclusively of a country in Country Group A:5; and (iv) the release of technology or source code takes place entirely within the physical territory of any such country, or within the United States.

For nationals other than those of Country Group A:5 countries, which are close military allies of the United States, other criteria may apply. In particular, the section specifies the situations in which the releases would not constitute deemed exports in a manner consistent with § 126.18 of the ITAR. For purposes of this section, “substantive contacts” has the same meaning as it has in § 126.18 of the ITAR. The proposed phrase “permanent and regular employee” was a combination of BIS's definition of “permanent employee,” as set forth in a BIS advisory opinion issued on November 19, 2007 (available on the BIS Web site), and the ITAR's definition of “regular employee” in § 120.39. The June 3 proposed rule added specific text excluding persons proscribed under U.S. law to make clear that § 734.20 does not authorize release of technology to persons proscribed under U.S. law, and defined “proscribed person” in § 772.1. (Note: The U.S.-U.K. Exchange of Notes and U.S.-Canadian Exchange of Letters referred to in the existing online guidance can be found on the State Department's Web site. The URLs for the letters are not being published in the EAR because URL addresses periodically change. BIS will place the URL references in an “FAQ” section of its Web site.)

One commenter stated that due to the number of conditions contained in these provisions, this section should be a license exception. BIS does not agree. Many if not most of the transactions to which these provisions apply are already covered by a license or a license exception; this section will generally allow affected entities to comply with the terms of those authorizations in a rational way that will meet U.S. control objectives while minimizing conflict with non-U.S. entities' domestic requirements.

Two commenters requested that BIS replace “is certain” of a foreign person's most recent country of citizenship or permanent residency with “has knowledge,” to address concerns about ability to comply with such a standard. BIS agrees with this comment and adopts “has 'knowledge'” in this final rule.

One commenter requested that BIS add “or within the physical territory of the United States” to certain provisions to account for the possibility of releases in the United States, because often “release of U.S.-origin technology or software could be said to take place partially within the United States and partially within the country in which the foreign person employee is located;” BIS accepts this request. Another commenter requested that for releases to A:5 nationals, BIS “also include countries where the entity conducts official business or operates, which is part of § 734.20(c) Release to other than A:5 nationals.” BIS did not adopt this request because it would expand the provision too broadly.

Two commenters requested that BIS cross reference the “deemed reexport” definition in § 734.14(b). BIS accepts this request. One commenter asked BIS to clarify that this section addresses non-U.S. entities. BIS believes that this is clear from context and is thus not changing the rule in response to this comment. However, BIS is including a description of the purpose of this section in its FAQs.

Two commenters objected to the requirement that employees must be engaged for a year to be eligible for these provisions and asked that it be removed. Additionally, two commenters objected to the associated screening and recordkeeping requirements and asked that they be reduced. BIS does not accept these comments. The year-long period and the screening and recordkeeping requirements reduce the risk of diversion associated with the technology release.

Questions and Answers—Technology and Software Subject to the EAR

The June 3 proposed rule removed Supplement No. 1 to part 734, “Questions and Answers—Technology and Software Subject to the EAR” on the basis that the questions and answers are illustrative rather than regulatory, and are therefore more appropriately posted as Web site guidance than included in the EAR. BIS specifically solicited comments on whether the questions and answers in existing Supplement No. 1 to part 734 proposed to be removed have criteria that should be retained in part 734.

Thirty commenters stated that BIS should not remove the questions and answers from the EAR. Reasons cited for opposing removal of the supplement included that the questions and answers will not have the same weight on the BIS Web site as they do in the EAR; that they are legally binding in the EAR; that their removal will create uncertainty; that their presence in EAR lessens the likelihood that interpretations will change outside the rulemaking process and promotes consistency of interpretation; and that other supplements contain regulatory information. One of these comments went on to say, “Accordingly, Supplement No. 1 must not be removed unless all its substantive provisions are adequately incorporated into Part 734 or elsewhere in the regulations” (emphasis supplied). BIS believes that the adequate incorporation of substantive provisions is the key point behind the comments. This concern drove the specific solicitation in the June 3 rule to identify criteria in the Supplement that should be retained in part 734. None of the thirty comments opposing removal of this Supplement from the EAR identified any substantive provisions that were not adequately incorporated into part 734 or elsewhere in the EAR. BIS is publishing on its Web site FAQs that will cover the same guidance that was found in Supplement No. 1, in addition to answers to other questions generated by the public comments to the proposed rule. Questions regarding how regulations apply to specific fact patterns are better set out in FAQs. In sum, although Supplement No. 1 will no longer be in the EAR, all its content will be placed into FAQs on BIS's Web site in addition to the other FAQs referred to in this preamble.

Technology

In the June 3 proposed rule, paragraph (a)(1) of the definition of technology reads as follows: “Information necessary for the “development,” “production,” “use,” operation, installation, maintenance, repair, overhaul, or refurbishing (or other terms specified in ECCNs on the CCL that control “technology”) of an item. “Technology” may be in any tangible or intangible form, such as written or oral communications, blueprints, drawings, photographs, plans, diagrams, models, formulae, tables, engineering designs and specifications, computer-aided design files, manuals or documentation, electronic media or information gleaned through visual inspection.”

A note addressed modification of items. Proposed paragraphs (a)(2) through (a)(4) of the definition were held in reserve to allow for the eventual mirroring of the corresponding ITAR paragraph structure while not including provisions that were not relevant to the EAR. Proposed paragraph (a)(5) described access information. Proposed paragraph (b) described exclusions from the definition of technology.

Required vs. Necessary

For the definition of “technology,” four commenters recommended that “necessary” be revised to read “required” to match the proposed ITAR definition. BIS does not adopt these recommendations. “Required” is a defined term that describes certain technology on the Commerce Control List, and not all technology that is subject to the EAR is controlled on the Commerce Control List. One commenter recommended restoring a note from the definition that existed in the EAR prior to publication of this rule, to the effect that technology not elsewhere specified on the Commerce Control List is designated as EAR99 unless it is not subject to the EAR. BIS does not accept this recommendation in this final rule because a regulatory change is not required to make the same point. BIS will, however, add an FAQ stating that “technology” subject to the EAR and that is not described on the CCL is designated EAR99. One commenter recommended including a note that refers to the General Technology Note. BIS accepts this comment and includes the reference in this final rule.

“Use” Elements

As explained in the preamble to the June 3 rule, the proposed definition of “technology” was based on the Wassenaar Arrangement definition of technology, including the Wassenaar-defined sub-definitions of “development,” “production,” and “use,” which are currently defined in § 772.1. (No changes were proposed to the definitions of “development,” “production,” and “use” in the June 3 rule, and none are made in this final rule.) The June 3 rule proposed no change to BIS's long-standing policy that all six activities in the definition of “use” (operation, installation (including on-site installation), maintenance (checking), repair, overhaul and refurbishing) must be present for an item to be classified under an ECCN paragraph that uses “use” to describe the “technology” controlled. (See 71 FR 30842, May 31, 2006.) Drawing from this existing framework, the proposed definition of “technology” included the terms “operation, installation, maintenance, repair, overhaul, or refurbishing (or other terms specified in ECCNs on the CCL that control `technology') of an item” because such words are used to describe technology controlled in multiple ECCNs, often with “or” rather than the “and” found in “use.”

One commenter recommended inserting a Note in the definition of technology that states the BIS policy that all six elements are necessary for “use” technology. BIS does not adopt this recommendation in this final rule because the definition of “use” links the six elements with the conjunctive “and” rather than the disjunctive “or.” BIS nonetheless makes this point in an FAQ pertaining to the word “use” in the definition of “technology.” One commenter recommended removing the term “installation” from the definition based on its use in the context of the definition of defense services. BIS does not accept this comment. Many entries on the Commerce Control List explicitly control installation technology, and it is also an element of “use” technology. Three commenters recommended that BIS remove the separate listing of the six “use” elements or limit them to control of 600 series items. BIS does not accept these recommendations. The six elements may be listed separately in entries on the Commerce Control List and are not limited to 600 series entries.

Information Gleaned Through Visual Inspection

One commenter suggested dropping “or information gleaned through visual inspection” because it was a form or method of transfer, not what constitutes technology. BIS adopts the recommendation in this comment in part. “Information gleaned through visual inspection” is an example of a form of technology, with visual inspection as the method of transfer. The list to which this example belongs, however, illustrates rather than defines “technology;” therefore, BIS adopts the text as Note 1 to the definition of “technology” in this final rule, limiting the definition to what constitutes technology and illustrating the forms in a note.

Another commenter suggested using “revealed” instead of “gleaned,” first to align with “release,” and second, because “use of the term ‘glean' implies the value of the information is based on the capability of the viewer, which is unknowable and unquantifiable. The use of the term ‘reveal' is a more objective measure of what is provided by the visual inspection.” BIS agrees and has adopted the term “revealed” in this final rule.

Modification Note

The June 3 rule proposed adding a note to address a common industry question about modification. The note read as follows: “The modification of an existing item creates a new item and technology for the modification is technical data for the development of the new item.”

Three commenters suggested revisions to this note. Two commenters described the note as overbroad or confusing. One commenter recommended adding “production” as well as “development.” In this final rule, BIS has adopted a revision that clarifies and narrows the description of the technology for modification, and includes “production” technology. The revised note reads as follows: “The modification of the design of an existing item creates a new item and technology for the modified design is technology for the development or production of the new item.” BIS created this note to address the fact that multiple variations of a product are usually created by one or more companies, and companies often struggle with how to classify the technology that is and is not common to the variations. Consider, for example, a company that makes a 9A991.d civil aircraft switch. It later modifies the switch so that it would work in a military aircraft. The modified switch—the “dash one” model—is, in this example, specially designed for a military aircraft and thus controlled under ECCN 9A610.x. The technology that is common to both switches is 9E991, but the additional or different technology to make the 9A610.x switch is controlled under 9E610. That is, the technology additional or different that is required to make the 9A991.d commercial aircraft switch into a 9A610.x switch is the technology for the new, modified item. This example is contained in an FAQ posted on the BIS Web site.

Decryption Keys

One commenter stated that decryption keys and other such information are not technology and recommended moving the proposed paragraph (a)(5) text to the definition of “release” and control “accessing” them. Another commenter pointed out that keys may also be hardware or software. BIS agrees with these comments; therefore, BIS does not adopt proposed paragraph (a)(5) in this final rule and adds text to the definition of “release” regarding transfer of “access information” (see also discussion above).

Exclusions

The June 3 rule proposed adding three exclusions to clarify the limits of the scope of the definition of “technology:” non-proprietary general system descriptions; information on basic function or purpose of an item; and telemetry data as defined in note 2 to Category 9, Product Group E (see Supplement No. 1 to Part 774 of the EAR).

The first two exclusions paralleled exclusions in the ITAR and the third, the exclusion of telemetry data, mirrored specific exclusions added to both the ITAR and the EAR as part of recent changes regarding the scope of U.S. export controls pertaining to satellites and related items. See 79 FR 27417 (May 13, 2014).

One commenter recommended excluding Build/Design-to-Specifications from the definition of technology and adding sub-definitions of different forms of technology. BIS does not accept this recommendation in this final rule because such specifications are not always outside the scope of the EAR's definition of “development” or “production” technology. However, BIS will incorporate information on this topic into its FAQs. Five commenters objected to use of the term “non-proprietary,” arguing that certain proprietary system descriptions should not be subject to the EAR. One commenter thought that the term “systems” was too narrow. BIS did not adopt these recommendations. Whether a particular technology is one that the possessor would readily share with competitors provides a fairly reliable test of whether that technology is subject to the EAR. With respect to the breadth of the term “system,” BIS notes that this exclusion is not the only provision in the EAR under which technology may be determined to be not subject. BIS did remove the modifier “general,” because of its potential to be ambiguous and subjective. BIS also did not adopt in this final rule the exclusion for “information on basic function or purpose of an item,” because the phrase was too vague and substantively already addressed by other provisions.

One commenter questioned the scope of these exclusions from the definition of technology and another questioned how the exclusions from the definition should be read in conjunction with the provisions in the Scope part that make items not subject to the EAR. Based on these comments, and as noted earlier in the preamble to this final rule, the exclusion of “information on basic function or purpose of an item” is not adopted and the remaining two exclusions are moved from the definition of technology to § 734.3(b)(3).

Required

The June 3 proposed rule retained the existing EAR definition of “required” in § 772.1, but added notes clarifying the application of the term. It removed parenthetical references in the existing definition to CCL Categories 4, 5, 6, and 9 to avoid the suggestion that BIS applies the definition of “required” only to the uses of the term in these categories. BIS has never had a separate definition of “required” used elsewhere in the EAR, and this removal merely eliminated a potential ambiguity and reflects long-standing BIS policy that “required” applies generally to “technology” entries on the CCL. (See, e.g., the Advisory Opinion dated December 27, 2010 on the BIS Web site.) BIS received one comment praising the removal of the references and none objecting to it; the revision is adopted in this final rule. The definition of “required” contained an illustrative example. BIS did not propose any revisions to this example in the June 3 rule. In this final rule, however, BIS revises the example to make clear that technology that is peculiarly responsible for the characteristics of the item that make it controlled is thus “required” technology. This subtle change thus responds to the question of which technology is “peculiarly responsible” but without changing the well-established definition of “required” that is central to the scope of the technology and software controls in the EAR. This revision also addresses issues raised by commenters, discussed more fully below, with respect to the proposed definition of “peculiarly responsible.”

To address common questions BIS has received regarding the meaning of the word “required,” the June 3 rule proposed adding two notes. The first stated that the references to “characteristics” and “functions” are not limited to entries on the CCL that use specific technical parameters to describe the scope of what is controlled. The “characteristics” and “functions” of an item listed are, absent a specific regulatory definition, a standard dictionary's definition of the item. The first note also included examples of this point. The second note referred to the fact that the ITAR and the EAR often divide within each set of regulations or between each set of regulations (a) controls on parts, components, accessories, attachments, and software and (b) controls on the end items, systems, equipment, or other articles into which those parts, components, accessories, attachments, and software are to be installed or incorporated. The note also referred to jurisdiction over technology. The public comments on these parts of the notes were favorable and the first note is included in this final rule without modification, except that it is now designated as Note 2 to the definition of “required.” The second note is split into Notes 1 and 3 to the definition of “required,” and the text is modified from the June 3 proposal as discussed below.

A core tenet of ECR is that the jurisdictional status of the technical data/technology for an article that moves from the USML to the EAR follows the article. BIS and DDTC recognize the need to clarify the jurisdictional line for such technical data/technology. To help those making jurisdictional self-determinations for technical data/technology pertaining to articles affected by the reform effort, BIS and DDTC had proposed in their respective June 3 rules common definitions of “required” and “peculiarly responsible” so that the regulatory line between technical data subject to the ITAR and technology subject to the EAR would be bright. Based on a review of the comments, BIS and DDTC have, however, decided not to publish their proposed common definitions of “required” and “peculiarly responsible.” (See discussion of the public comments on “peculiarly responsible” below.) Rather, DDTC and BIS have determined that a better way for the ITAR to address this bright-line objective is for DDTC to publish, and get public comments on, a proposed definition of “directly related” that will eventually lead to a final ITAR definition acceptable to both DDTC and BIS. The reason for this approach is that, with the exception of technical data specifically enumerated on the USML, technical data is subject to the ITAR only if it is “directly related” to a defense article. This means, by definition, that technology that is indirectly related to, or only “related to,” a defense article, such as by merely being capable for use with, used in connection with, or somehow having something generally to do with the eventual functioning of a defense article, is not subject to the ITAR and is, thus, subject to the EAR. For example, technology required for the production of a 9A610.x aircraft component—which, by definition, means that that it is specially designed for a USML VIII(a) aircraft—does not become subject to the ITAR merely because it generally relates to a defense article by virtue of being a component that will be or is integrated into and necessary for the functioning of the aircraft subject to the ITAR. It is technology required for the aircraft component subject to the EAR, not the whole of the USML aircraft or another defense article, and thus subject to the EAR. On the other hand, technical data that is directly related to the production of a component subject to the ITAR does not become subject to the EAR merely because, for example, it is developed or manufactured with equipment subject to the EAR.

Wanting to nonetheless respond to the comments seeking guidance regarding the jurisdictional status of technology pertaining to items that have moved to the CCL from the USML and to further advance the effort of creating a truly bright line jurisdictional rule, BIS is publishing with this rule as a third note to “required” its guidance on the topic because the meaning of “required” is central to such determinations. Specifically, unclassified technology not specifically enumerated on the USML is “subject to the EAR” if it is “required” for the “development,” “production,” “use,” operation, installation, maintenance, repair, overhaul, or refurbishing (or other terms specified in ECCNs on the CCL that control “technology”) of a commodity or software that is “subject to the EAR.” If such information is technical data that is not “required” for an item subject to the EAR and directly related to a defense article, then it is subject to the ITAR. If the application of industry-standard or dictionary definitions of “directly related” does not resolve doubts about whether any unit of technical data is, as a matter of law, “directly related” (as opposed to indirectly related) to a defense article, one should contact DDTC for resolution of the doubt through established procedures in the ITAR's Part 120.

Peculiarly Responsible

In the June 3 rule, BIS proposed a definition of the term “peculiarly responsible” that was modeled on the catch-and-release structure BIS adopted for the definition of “specially designed.” Thus, under the proposed definition, an item was “peculiarly responsible” for achieving or exceeding any referenced controlled performance levels, characteristics, or functions if it was used in “development,” “production,” “use,” operation, installation, maintenance, repair, overhaul, or refurbishing of an item subject to the EAR unless (a) the Department of Commerce had determined otherwise in a commodity classification determination, (b) the item was identical to information used in or with a commodity or software that was or had been in production and was EAR99 or described in an ECCN controlled only for Anti-Terrorism (AT) reasons, (c) the item had been or was being developed for use in or with general purpose commodities or software, or (d) the item had been or was being developed with “knowledge” that it would be for use in or with commodities or software described (i) in an ECCN controlled for AT-only reasons and also EAR99 commodities or software or (ii) exclusively for use in or with EAR99 commodities or software.

BIS specifically solicited comments on whether the proposed definition of “peculiarly responsible” effectively explained how items may be “required” or “specially designed” for particular functions. Two commenters offered support for the definition but still suggested revisions. Twelve additional commenters objected to the definition, describing it as confusing and stating that it dramatically expanded the scope of control beyond the existing “required” technology definition. BIS agrees with these comments and does not adopt the proposed definition of “peculiarly responsible” in this final rule. As described above, in this final rule, peculiarly responsible is defined within the scope of the already existing definition of required, thus providing a definition while guaranteeing no expansion of scope.

Temporary Export of Technology

The June 3 proposed rule included amended text in the temporary export of technology provisions of License Exception TMP by revising § 740.9(a)(3) to clarify that the “U.S. employer” and “U.S. persons or their employees” using this license exception are not foreign subsidiaries. The proposed paragraph streamlined current text without changing the scope. In this final rule, BIS substitutes “foreign person” for “foreign national” in this section for reasons discussed elsewhere in this preamble, except where “natural person” was meant and BIS substituted “individual” for clarity (and in so doing responded to a comment on including foreign nationals in paragraph (a)(3)(iii)). BIS also added authority to reexport or transfer (in-country) to the authority to export; the absence of these terms from the June 3 proposed rule was an oversight.

One commenter stated that BIS should provide for use of this license exception by non-U.S. persons. Another commenter recommended that BIS expand the scope of the license exception to include foreign subsidiaries and affiliates. BIS does not adopt these recommendations. Because of the risks associated with securing temporary exports of technology, BIS is not broadening the provisions for foreign persons beyond those employed by U.S. companies or to allow use by foreign companies.

BIS received two comments on the recordkeeping provision in paragraph (a)(3)(v), with one requesting that it be clarified and one requesting that it be removed in view of the existing broad recordkeeping requirements in the EAR. BIS agrees with these comments and does not adopt the recordkeeping provision in this final rule.

One commenter asked BIS to clarify if TMP is available for remote access to U.S. servers. Another commenter asked BIS to clarify if taking an encrypted device is an export. BIS is not including these changes in regulatory text, because these are applications of the rule that are more appropriate to FAQs. However, BIS is confirming in its FAQs that TMP is available for remote access if its provisions are met. BIS is also confirming in its FAQs that taking an encrypted device is an export and referring to a different paragraph of § 740.9 for authorizing export of devices. Devices are commodities and therefore not eligible for paragraph (a)(3), which authorizes only technology.

One commenter recommended that BIS remove a requirement to encrypt the technology, saying that the list of techniques for securing the data required all to be used. BIS accepts this comment, and this final rule adds “may” before “include” to make clear that the list is illustrative. One commenter recommended allowing obfuscation/tokenization to protect data. BIS agrees that done properly, this is an effective security measure, and will add an FAQ on the topic to its Web site.

Scope of a License

The June 3 rule proposed implementing in the EAR the interagency-agreed boilerplate notification for all licenses that was posted on the BIS Web site and began appearing on licenses December 8, 2014. It was a slight revision to the former § 750.7(a), which stated that licenses authorize only the transaction(s) described in the license application and the license application support documents. The proposed revision also codified the existing interpretation that a license authorizing the release of technology to an entity also authorizes the release of the same technology to the entity's foreign nationals who are permanent and regular employees of the entity's facility or facilities authorized on the license, except to the extent a license condition limits or prohibits the release of the technology to nationals of specific countries or country groups.

Two commenters requested that BIS drop the modifier “permanent and” from “regular employees.” BIS does not adopt this request due to risk of diversion associated with non-permanent and non-regular employees. See further discussion of this issue above with respect to activities that are not deemed reexports. The phrase “under U.S. law” that modified “proscribed persons” in the June 3 rule is not adopted in this final rule for reasons discussed in connection with the definition of “proscribed persons” below. Except for that change, this final rule adopts the text proposed in the June 3 rule.

Removals From and Additions to EAR's List of Definitions in § 772.1

This final rule creates stand-alone sections in the EAR to address the scope and meaning of “publicly available information,” “publicly available technology and software,” and “technical data.” To avoid redundancy, this rule removes those definitions from § 772.1. In light of the changes described above, the definitions of “export,” “reexport,” “required,” “technology,” and “transfer” are revised accordingly. A clarifying note is added at the bottom of the definition explaining that the use of “transfer” does not apply to the unrelated “transfers of licenses” provision in § 750.10 or the antiboycott provisions in Supplement No. 8 to part 760 of the EAR. It also states that the term “transfer” may be included on licenses issued by BIS. In that regard, the changes that can be made to a BIS license are the non-material changes described in § 750.7(c). Any other change to a BIS license without authorization is a violation of the EAR. See §§ 750.7(c) and 764.2(e). Finally, consistent with the explanations above, definitions for the terms “access information,” “foreign person,” “fundamental research,” “proscribed person,” “publicly available encryption software,” “published,” and “release” are added to § 772.1.

One commenter stated that the definition of proscribed persons was overbroad, catching those individuals sanctioned under U.S. law without an export control nexus and recommended deleting “under US law.” BIS agrees with this comment. One commenter recommended striking “scientific” from the definition of “basic scientific research” in part 772 and adding definitions of applied and fundamental research to part 772. BIS does not accept this recommendation. The definition of “basic scientific research” reflects a Wassenaar Arrangement definition; it is retained in this final rule. A definition for applied research is not adopted because it is not necessary as a result of the adoption of a simplified definition of fundamental research, and as fundamental research is defined in § 734.8, use of a cross reference in part 772 is appropriate.

Issues Raised by Public Comments That Are Outside the Scope of This Rule

One commenter requested that BIS clarify treatment of U.S.-origin chemical materials that are substantially transformed and exempt Japan and other like-minded countries from reexport controls. One commenter requested that BIS expand controls on missile production and drop Fiji from Country Group D:5. One commenter appended comments on a separate BIS proposed rule for which the comment period was already closed. One commenter stated that items classified under Export Control Classification Number 0A998 will no longer be subject to the EAR under the new note to § 734.3(b)(3). One commenter requested that BIS drop the term “serial” from the definition of “production,” which was not revised by this rule. Although these comments are outside the scope of this rule and thus not addressed in this notice, BIS nonetheless encourages the public to submit thoughts, suggestions, and comments to BIS about the EAR and the export control system. BIS cannot commit to addressing them in every case, but nonetheless encourages as much industry participation as possible in the development and drafting of the regulations.

Export Administration Act

Since August 21, 2001, the Export Administration Act of 1979, as amended, has been in lapse. However, the President, through Executive Order 13222 of August 17, 2001, 3 CFR, 2001 Comp., p. 783 (2002), as amended by Executive Order 13637 of March 8, 2013, 78 FR 16129 (March 13, 2013), and as extended by the Notice of August 7, 2015 (80 FR 48233 (Aug. 11, 2015) has continued the EAR in effect under the International Emergency Economic Powers Act (50 U.S.C. 1701 et seq.). BIS continues to carry out the provisions of the Export Administration Act, as appropriate and to the extent permitted by law, pursuant to Executive Order 13222 as amended by Executive Order 13637.

Regulatory Requirements

1. Executive Orders 13563 and 12866 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distribute impacts, and equity). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This final rule has been designated a “significant regulatory action,” although not economically significant, under section 3(f) of Executive Order 12866. Accordingly, this final rule has been reviewed by the Office of Management and Budget (OMB).

2. This final rule does not contain information collections subject to the requirements of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.) (PRA). Notwithstanding any other provision of law, no person is required to respond to, nor is subject to a penalty for failure to comply with, a collection of information, subject to the requirements of the PRA, unless that collection of information displays a currently valid OMB control number.

3. This final rule does not contain policies with Federalism implications as that term is defined under E.O. 13132.

4. Pursuant to the Regulatory Flexibility Act, as amended by the Small Business Regulatory Enforcement Fairness Act of 1996, 5 U.S.C. 601 et seq., BIS has prepared the following final Regulatory Flexibility Act analysis of the impact that this final rule will have on small entities.

Statement of the Objectives of, and Legal Basis for, the Final Rule; Identification of All Relevant Federal Rules Which May Duplicate, Overlap, or Conflict With the Final Rule

The objective of this final rule (and a final rule being published simultaneously by the Department of State) is to provide greater clarity and precision in the EAR and the ITAR by providing, where warranted and possible, common definitions and common terms to regulate the same types of actions and issues. This final rule also seeks to express some concepts more clearly.

The final rule alters definitions in the EAR. It also updates and clarifies application of controls to electronically transmitted technology and software.

The legal basis for this proposed rule is 50 U.S.C. 4601 et seq.; 50 U.S.C. 1701 et seq.; E.O. 12938, 59 FR 59099, 3 CFR, 1994 Comp., p. 950; E.O. 13020, 61 FR 54079, 3 CFR, 1996 Comp., p. 219; E.O. 13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 228; E.O. 13222, 66 FR 44025, 3 CFR, 2001 Comp., p. 783; E.O. 13637, 78 FR 16129, 3 CFR, 2014 Comp., p. 223; Notice of August 7, 2015, 80 FR 48233 (August 11, 2015); Notice of November 12, 2015, 80 FR 70667 (November 13, 2015).

No other Federal rules duplicate, overlap, or conflict with this final rule.

Comments in Response to the Initial Regulatory Flexibility Analysis

BIS received one comment from the public in response to the Initial Regulatory Flexibility Analysis (IRFA). The comment stated that while the proposed regulatory text indicated that the extent to which release of access information could be a violation of the EAR was limited by whether the party acted with knowledge, text in the IRFA regarding the impact of this provision created tension by stating that other provisions in the EAR could be used to bring charges for that same type of misconduct. The comment requested that BIS provide clarification in the final rule. BIS addressed this comment by not adopting § 764.2(l), the provision that would have established the violation at issue in the final rule. The Chief Counsel for Advocacy of the Small Business Administration filed no comments in response to the proposed rule.

Number and Description of Small Entities to Which This Rule Will Apply

This final rule will apply to all persons engaged in the export, reexport, or transfer of commodities, technology, or software subject to the EAR. BIS does not maintain data from which it can determine how many of those persons are small entities as identified in the Small Business Administration size standards. Nevertheless, BIS recognizes that some of those persons are likely to be small entities.

Description of the Projected Reporting, Recordkeeping, and Other Compliance Requirements of the Final Rule

This final rule is unlikely to increase the number of transactions that must be reported to BIS because EAR reporting requirements apply only in five specific situations, none of which will change as a result of this final rule. Those situations are: Exports of items on the Wassenaar Arrangement Sensitive List that do not require a license; Exports of High Performance Computers; Exports of certain thermal imaging cameras that do not require a license; Certain exports of Conventional Arms; and 600 series major defense equipment. Because recordkeeping requirements already apply to all transactions that are subject to the EAR, BIS expects that this final rule will not expand recordkeeping requirements.

It is possible that some of these changes will increase the number of licenses that some small entities will have to seek from BIS, although BIS is not aware of any specific instance in which additional licenses will be required.

The following discussion describes the changes made by this final rule. It is divided into two sections: Changes that BIS believes will not impose any new regulatory obligations; and Changes that are not intended to imposed any new regulatory obligation, but that BIS cannot state with certainty will not do so.

Changes That BIS Believes Will Not Impose Any New Regulatory Burden

This final rule makes certain changes to clarify and streamline the definitions of comparable terms, phrases, and concepts between the EAR and the ITAR. Many of these changes are technical in nature and attempt to consolidate and re-phrase the definitions to enhance readability and to parallel the structure of the ITAR's definition of the same term. There are a small number of new provisions, but these changes do not impose any new regulatory burdens. Specifically, this final rule makes the following changes:

Removes § 734.2(b) which formerly defined export, reexport, release, transfer (in country) and export of encryption source code or object code software, because those terms are defined in separate sections. Section 734.2(b) also stated the policy of applying license requirements that apply to a country to its dependencies and possessions; this policy is currently stated elsewhere in the EAR.

Creates new separate sections defining export, reexport, release and export of encryption source code or object code software. Those terms are clarified and presented in a more organized manner, but substantively unchanged from the former regulatory text.

Creates a new section identifying activities that are not exports, reexports, or transfers. This section restates the transactions that are excluded from the definition of export in former regulatory text and adds two additional activities that are expressly declared not to be exports, reexports or transfers: Space launches; and sending, taking or storing certain technology or software abroad using specified cryptographic techniques. The former, although it was not included in past regulatory text, states an exclusion already set forth in a statute (see 51 U.S.C. 50919(f)) and is consistent with past BIS practice of not treating a space launch as an export, reexport or transfer. The latter is, in fact, new. However, by removing the transactions it describes from the definitions of exports, reexports, or transfers, it removes existing license requirements from those transactions.

Clarifies without substantively changing the provisions related to patent applications and adds specific text stating that technology contained in a patent available from or at any patent office is not subject to the EAR. The addition reflects BIS's long-standing interpretation. To the extent that it could be characterized as new, its only effect would be to appear to release from the EAR technology that some readers of the EAR might have (erroneously) concluded was subject to the EAR.

Adds text to License Exception TMP to emphasize that foreign subsidiaries of U.S. companies are neither U.S. employers nor “U.S. persons or their employees” as those terms are used in the license exception. This additional text adds no restriction that is not already imposed by the definition of “U.S. persons” that currently appears in the text of License Exception TMP.

Adds text codifying in the EAR limits on transactions authorized by a license that currently are imposed by conditions on the license itself.

Adds text specifying that to the extent an authorization would be required to transfer technology or software, a comparable authorization is required to transfer access information (e.g., decryption keys, network access codes, and passwords) with “knowledge” that such transfer would result in the unauthorized release of such technology or software.

Changes That Are Not Intended To Impose Any Regulatory Obligation, But That BIS Cannot State With Certainty Would Not Do So

This final rule revises the definitions of the two existing terms “required” and “transfer (in-country).” It also adopts BIS's interpretative guidance regarding deemed reexports as regulatory text. These changes are not intended to impose any regulatory obligations on regulated entities, but BIS cannot state with certainty that there will be no impact. This final rule makes the following changes:

Adds to the EAR a definition of “proscribed person.” This definition does not create any new regulated class. It simply provides a clear, shorthand reference to a person who is already prohibited from receiving items or participating in a transaction that is subject to the EAR without authorization, such as persons on the Entity List.

Removes from the definition of the term “required” references to CCL Categories 4, 5, 6 and 9 to accurately reflect BIS's long-standing interpretation that its definition applies wherever the EAR imposes a license requirement for technology “required” for a particular process or activity.

In the definition of “transfer (in-country),” replaces the phrase “shipment, transmission, or release of items subject to the EAR from one person to another person that occurs outside the United States within a single foreign country” with “a change in end use or end user of an item within the same foreign country.” This new text will parallel the term “retransfer” in the ITAR and will eliminate any potential ambiguity that a change in end use or end user within a foreign country is or is not a “transfer (in-country).”

Each of the foregoing changes serves the overall policy goals of reducing uncertainty and harmonizing, to the extent warranted and possible, the requirements of the ITAR and the EAR. In most instances, reduced uncertainty will be beneficial to persons who have to comply with the regulations, particularly persons who engage in transactions subject to both sets of regulations. They will be able to make decisions more quickly and have less need to contact BIS for advice. Additionally, by making these terms more explicit, the possibility of their being interpreted contrary to BIS's intent is reduced. Such contrary interpretations would have three undesirable effects. First, they would undermine the national security and foreign policy objectives that the EAR are intended to implement. Second, persons who are interpreting the regulations in a less restrictive manner than BIS intends may seek fewer licenses from BIS than their competitors who are interpreting the regulations consistent with BIS's intent or who are obtaining advice from BIS, thereby gaining a commercial advantage to the detriment of the relevant national security or foreign policy interests. Third, unnecessary regulatory complexity and unnecessary differences between the terminology of the ITAR and that of the EAR could discourage small entities from even attempting to export. The beneficial effects of making these terms more explicit justify the economic impact that might be incurred by small entities that will have to change their conduct because their contrary interpretations can no longer be relied on given the clearer and more explicit terms in the regulations.

This final rule also adds to the EAR a description of activities that are not deemed reexports. This description formerly appeared as interpretative guidance on BIS's Web site and closely tracks the regulatory text of the ITAR. Deemed reexports are releases of technology or software source code within a single foreign country by a party located outside the United States to a national of a country other than the country in which the releasing party is located. The new section describes three situations in which that party may release the technology or source code without obtaining a license from BIS.

By adopting this guidance as regulatory text that closely tracks the text governing the same activities in the ITAR, BIS reduces both complexity and unnecessary differences between the two sets of regulations with the salutary effects of faster decision making, reduced need to contact BIS for advice, and reduced possibility that small entities would be discouraged from exporting as noted above.

Description of Any Significant Alternatives to the Final Rule That Accomplish the Stated Objectives of Applicable Statutes and That Minimize Any Significant Economic Impact of the Final Rule on Small Entities

As required by 5 U.S.C. 603(c), BIS's analysis considered significant alternatives. Those alternatives are: (1) The preferred alternative of altering definitions and updating and clarifying application of controls to electronically transmitted technology and software; (2) Maintaining the status quo and not revising the definitions or updating and clarifying application of controls to electronically transmitted technology and software; and (3) Establishing a size threshold below which entities would not be subject to the changes proposed by this rulemaking.

By altering definitions and updating and clarifying application of controls to electronically transmitted technology and software as this final rule does, BIS reduces uncertainty for all parties engaged in transactions that are subject to the EAR. Potential ambiguities are reduced; decisions can be made more quickly; the need to contact BIS for advice is reduced; and the possibility of inconsistent interpretations providing one party commercial advantages over others is reduced. Persons (including small entities) engaged in transactions that are subject to the ITAR and transactions that are subject to the EAR face fewer actual or apparent inconsistencies that must be addressed in their regulatory compliance programs. Although small entities, along with all other parties, will need to become familiar with the revised terminology, in the long run, compliance costs are likely to be reduced when compared to the present situation where the ITAR and the EAR use different terminology to regulate the same types of activity in the same manner. Therefore, BIS adopted this alternative.

If BIS had chosen to maintain the status quo, small entities and other parties would not have to incur the cost and effort of becoming familiar with the revised regulations, and any party who was interpreting the regulations in a way that would clearly be precluded by the more explicit interpretations would not incur the cost of complying with the regulations consistent with their underlying intent and in the way that BIS believes most regulated parties do. However, the benefits of these proposed changes would be lost. Those benefits, greater clarity, consistency between the ITAR and the EAR, and reduced possibility of inconsistent application of the regulations by similarly situated regulated parties, would be foregone. Therefore, BIS has not adopted this alternative.

If BIS had chosen to create a size threshold exempting small entities as currently defined by the SBA size standards from the changes imposed by this final rule, those entities would face a more complicated regulatory environment than larger entities. The small entities would continue to be subject to the EAR as a whole but without the benefit of the clarifications introduced by this final rule. The only way to make a size threshold beneficial to entities falling below the threshold would be to exempt them from all or at least many of the requirements of the EAR. However, doing so would create a major loophole allowing commodities, software, and technology that are controlled for export for national security or foreign policy reasons to go, without restriction, to any party abroad, undermining the interests that the regulations are intended to protect. Therefore, BIS has not adopted this alternative.

List of Subjects 15 CFR Parts 734 and 772

Exports.

15 CFR Parts 740 and 750

Administrative practice and procedure, Exports, Reporting and recordkeeping requirements.

For the reasons stated in the preamble, parts 734, 740, 750, and 772 of the Export Administration Regulations (15 CFR subchapter C) are amended as follows:

PART 734—SCOPE OF THE EXPORT ADMINISTRATION REGULATIONS 1. The authority citation for part 734 continues to read as follows: Authority:

50 U.S.C. 4601 et seq.; 50 U.S.C. 1701 et seq.; E.O. 12938, 59 FR 59099, 3 CFR, 1994 Comp., p. 950; E.O. 13020, 61 FR 54079, 3 CFR, 1996 Comp., p. 219; E.O. 13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 228; E.O. 13222, 66 FR 44025, 3 CFR, 2001 Comp., p. 783; E.O. 13637, 78 FR 16129, 3 CFR, 2014 Comp., p. 223; Notice of August 7, 2015, 80 FR 48233 (August 11, 2015); Notice of November 12, 2015, 80 FR 70667 (November 13, 2015).

2. Section 734.2 is amended by revising the heading to read as follows and by removing and reserving paragraph (b).
§ 734.2 Subject to the EAR.
3. Section 734.3 is amended by revising paragraph (b) introductory text, paragraph (b)(3), the Note to paragraphs (b)(2) and (b)(3), and adding a Note to paragraph (b)(3) to read as follows.
§ 734.3 Items subject to the EAR.

(b) The following are not subject to the EAR:

(3) Information and “software” that:

(i) Are published, as described in § 734.7;

(ii) Arise during, or result from, fundamental research, as described in § 734.8;

(iii) Are released by instruction in a catalog course or associated teaching laboratory of an academic institution;

(iv) Appear in patents or open (published) patent applications available from or at any patent office, unless covered by an invention secrecy order, or are otherwise patent information as described in § 734.10;

(v) Are non-proprietary system descriptions; or

(vi) Are telemetry data as defined in Note 2 to Category 9, Product Group E (see Supplement No. 1 to part 774 of the EAR).

Note to paragraphs (b)(2) and (b)(3):

A printed book or other printed material setting forth encryption source code is not itself subject to the EAR (see § 734.3(b)(2)). However, notwithstanding § 734.3(b)(2), encryption source code in electronic form or media (e.g., computer diskette or CD ROM) remains subject to the EAR (see § 734.17)). Publicly available encryption object code “software” classified under ECCN 5D002 is not subject to the EAR when the corresponding source code meets the criteria specified in § 740.13(e) of the EAR.

Note to paragraph (b)(3):

Except as set forth in part 760 of this title, information that is not within the scope of the definition of “technology” (see § 772.1 of the EAR) is not subject to the EAR.

4. Section 734.7 is revised to read as follows:
§ 734.7 Published.

(a) Except as set forth in paragraph (b) of this section, unclassified “technology” or “software” is “published,” and is thus not “technology” or “software” subject to the EAR, when it has been made available to the public without restrictions upon its further dissemination such as through any of the following:

(1) Subscriptions available without restriction to any individual who desires to obtain or purchase the published information;

(2) Libraries or other public collections that are open and available to the public, and from which the public can obtain tangible or intangible documents;

(3) Unlimited distribution at a conference, meeting, seminar, trade show, or exhibition, generally accessible to the interested public;

(4) Public dissemination (i.e., unlimited distribution) in any form (e.g., not necessarily in published form), including posting on the Internet on sites available to the public; or

(5) Submission of a written composition, manuscript, presentation, computer-readable dataset, formula, imagery, algorithms, or some other representation of knowledge with the intention that such information will be made publicly available if accepted for publication or presentation:

(i) To domestic or foreign co-authors, editors, or reviewers of journals, magazines, newspapers or trade publications;

(ii) To researchers conducting fundamental research; or

(iii) To organizers of open conferences or other open gatherings.

(b) Published encryption software classified under ECCN 5D002 remains subject to the EAR unless it is publicly available encryption object code software classified under ECCN 5D002 and the corresponding source code meets the criteria specified in § 740.13(e) of the EAR.

5. Section 734.8 is revised to read as follows:
§ 734.8 “Technology” or “software” that arises during, or results from, fundamental research.

(a) Fundamental research. “Technology” or “software” that arises during, or results from, fundamental research and is intended to be published is not subject to the EAR.

Note 1 to paragraph (a):

This paragraph does not apply to “technology” or “software” subject to the EAR that is released to conduct fundamental research. (See § 734.7(a)(5)(ii) for information released to researchers that is “published.”)

Note 2 to paragraph (a):

There are instances in the conduct of research where a researcher, institution or company may decide to restrict or protect the release or publication of “technology” or “software” contained in research results. Once a decision is made to maintain such “technology” or “software” as restricted or proprietary, the “technology” or “software,” if within the scope of § 734.3(a), becomes subject to the EAR.

(b) Prepublication review. “Technology” or “software” that arises during, or results, from fundamental research is intended to be published to the extent that the researchers are free to publish the “technology” or “software” contained in the research without restriction. “Technology” or “software” that arises during or results from fundamental research subject to prepublication review is still intended to be published when:

(1) Prepublication review is conducted solely to ensure that publication would not compromise patent rights, so long as the review causes no more than a temporary delay in publication of the research results;

(2) Prepublication review is conducted by a sponsor of research solely to insure that the publication would not inadvertently divulge proprietary information that the sponsor has furnished to the researchers; or

(3) With respect to research conducted by scientists or engineers working for a Federal agency or a Federally Funded Research and Development Center (FFRDC), the review is conducted within any appropriate system devised by the agency or the FFRDC to control the release of information by such scientists and engineers.

Note 1 to paragraph (b):

Although “technology” or “software” arising during or resulting from fundamental research is not considered intended to be published if researchers accept restrictions on its publication, such “technology” or “software” will nonetheless qualify as “technology” or “software” arising during or resulting from fundamental research once all such restrictions have expired or have been removed.

Note 2 to paragraph (b):

Research that is voluntarily subjected to U.S. government prepublication review is considered “intended to be published” when the research is released consistent with the prepublication review and any resulting controls.

Note 3 to paragraph (b):

“Technology” or “software” resulting from U.S. government funded research that is subject to government-imposed access and dissemination or other specific national security controls qualifies as “technology” or “software” resulting from fundamental research, provided that all government-imposed national security controls have been satisfied and the researchers are free to publish the “technology” or “software” contained in the research without restriction. Examples of specific national security controls include requirements for prepublication review by the Government, with right to withhold permission for publication; restrictions on prepublication dissemination of information to non-U.S. citizens or other categories of persons; or restrictions on participation of non-U.S. citizens or other categories of persons in the research. A general reference to one or more export control laws or regulations or a general reminder that the Government retains the right to classify is not a specific national security control.

(c) Fundamental research definition. Fundamental research means research in science, engineering, or mathematics, the results of which ordinarily are published and shared broadly within the research community, and for which the researchers have not accepted restrictions for proprietary or national security reasons.

§ 734.9—[Removed and Reserved]
6. Section 734.9 is removed and reserved.
7. Section 734.10 is revised to read as follows:
§ 734.10 Patents.

“Technology” is not subject to the EAR if it is contained in any of the following:

(a) A patent or an open (published) patent application available from or at any patent office;

(b) A published patent or patent application prepared wholly from foreign-origin “technology” where the application is being sent to the foreign inventor to be executed and returned to the United States for subsequent filing in the U.S. Patent and Trademark Office;

(c) A patent application, or an amendment, modification, supplement or division of an application, and authorized for filing in a foreign country in accordance with the regulations of the Patent and Trademark Office, 37 CFR part 5; or

(d) A patent application when sent to a foreign country before or within six months after the filing of a United States patent application for the purpose of obtaining the signature of an inventor who was in the United States when the invention was made or who is a co-inventor with a person residing in the United States.

§ 734.11—[Removed and Reserved]
8. Section 734.11 is removed and reserved.
9. Section 734.13 is added to read as follows:
§ 734.13 Export.

(a) Except as set forth in §§ 734.17 or 734.18, Export means:

(1) An actual shipment or transmission out of the United States, including the sending or taking of an item out of the United States, in any manner;

(2) Releasing or otherwise transferring “technology” or source code (but not object code) to a foreign person in the United States (a “deemed export”);

(3) Transferring by a person in the United States of registration, control, or ownership of:

(i) A spacecraft subject to the EAR that is not eligible for export under License Exception STA (i.e., spacecraft that provide space-based logistics, assembly or servicing of any spacecraft) to a person in or a national of any other country; or

(ii) Any other spacecraft subject to the EAR to a person in or a national of a Country Group D:5 country.

(b) Any release in the United States of “technology” or source code to a foreign person is a deemed export to the foreign person's most recent country of citizenship or permanent residency.

(c) The export of an item that will transit through a country or countries to a destination identified in the EAR is deemed to be an export to that destination.

10. Section 734.14 is added to read as follows:
§ 734.14 Reexport.

(a) Except as set forth in §§ 734.18 and 734.20, Reexport means:

(1) An actual shipment or transmission of an item subject to the EAR from one foreign country to another foreign country, including the sending or taking of an item to or from such countries in any manner;

(2) Releasing or otherwise transferring “technology” or source code subject to the EAR to a foreign person of a country other than the foreign country where the release or transfer takes place (a deemed reexport);

(3) Transferring by a person outside the United States of registration, control, or ownership of:

(i) A spacecraft subject to the EAR that is not eligible for reexport under License Exception STA (i.e., spacecraft that provide space-based logistics, assembly or servicing of any spacecraft) to a person in or a national of any other country; or

(ii) Any other spacecraft subject to the EAR to a person in or a national of a Country Group D:5 country.

(b) Any release outside of the United States of “technology” or source code subject to the EAR to a foreign person of another country is a deemed reexport to the foreign person's most recent country of citizenship or permanent residency, except as described in § 734.20.

(c) The reexport of an item subject to the EAR that will transit through a country or countries to a destination identified in the EAR is deemed to be a reexport to that destination.

11. Section 734.15 is added to read as follows:
§ 734.15 Release.

(a) Except as set forth in § 734.18, “technology” and “software” are “released” through:

(1) Visual or other inspection by a foreign person of items that reveals “technology” or source code subject to the EAR to a foreign person; or

(2) Oral or written exchanges with a foreign person of “technology” or source code in the United States or abroad.

(b) Any act causing the “release” of “technology” or “software,” through use of “access information” or otherwise, to yourself or another person requires an authorization to the same extent an authorization would be required to export or reexport such “technology” or “software” to that person.

12. Section 734.16 is added to read as follows:
§ 734.16 Transfer (in-country).

Except as set forth in § 734.18(a)(3), a Transfer (in-country) is a change in end use or end user of an item within the same foreign country. Transfer (in-country) is synonymous with In-country transfer.

13. Section 734.17 is added to read as follows:
§ 734.17 Export of encryption source code and object code software.

(a) For purposes of the EAR, the Export of encryption source code and object code “software” means:

(1) An actual shipment, transfer, or transmission out of the United States (see also paragraph (b) of this section); or

(2) A transfer of such “software” in the United States to an embassy or affiliate of a foreign country.

(b) The export of encryption source code and object code “software” controlled for “EI” reasons under ECCN 5D002 on the Commerce Control List (see Supplement No. 1 to part 774 of the EAR) includes:

(1) Downloading, or causing the downloading of, such “software” to locations (including electronic bulletin boards, Internet file transfer protocol, and World Wide Web sites) outside the U.S., or

(2) Making such “software” available for transfer outside the United States, over wire, cable, radio, electromagnetic, photo optical, photoelectric or other comparable communications facilities accessible to persons outside the United States, including transfers from electronic bulletin boards, Internet file transfer protocol and World Wide Web sites, unless the person making the “software” available takes precautions adequate to prevent unauthorized transfer of such code. See § 740.13(e) of the EAR for notification requirements for exports or reexports of encryption source code “software” considered to be publicly available or published consistent with the provisions of § 734.3(b)(3). Publicly available encryption “software” in object code that corresponds to encryption source code made eligible for License Exception TSU under § 740.13(e) of the EAR is not subject to the EAR.

(c) Subject to the General Prohibitions described in part 736 of the EAR, such precautions for Internet transfers of products eligible for export under § 740.17(b)(2) of the EAR (encryption “software” products, certain encryption source code and general purpose encryption toolkits) shall include such measures as:

(1) The access control system, either through automated means or human intervention, checks the address of every system outside of the U.S. or Canada requesting or receiving a transfer and verifies such systems do not have a domain name or Internet address of a foreign government end-user (e.g., “.gov,” “.gouv,” “.mil” or similar addresses);

(2) The access control system provides every requesting or receiving party with notice that the transfer includes or would include cryptographic “software” subject to export controls under the Export Administration Regulations, and anyone receiving such a transfer cannot export the “software” without a license or other authorization; and

(3) Every party requesting or receiving a transfer of such “software” must acknowledge affirmatively that the “software” is not intended for use by a government end user, as defined in part 772 of the EAR, and he or she understands the cryptographic “software” is subject to export controls under the Export Administration Regulations and anyone receiving the transfer cannot export the “software” without a license or other authorization. BIS will consider acknowledgments in electronic form provided they are adequate to assure legal undertakings similar to written acknowledgments.

14. Section 734.18 is added to read as follows:
§ 734.18 Activities that are not exports, reexports, or transfers.

(a) Activities that are not exports, reexports, or transfers. The following activities are not exports, reexports, or transfers:

(1) Launching a spacecraft, launch vehicle, payload, or other item into space.

(2) Transmitting or otherwise transferring “technology” or “software” to a person in the United States who is not a foreign person from another person in the United States.

(3) Transmitting or otherwise making a transfer (in-country) within the same foreign country of “technology” or “software” between or among only persons who are not “foreign persons,” so long as the transmission or transfer does not result in a release to a foreign person or to a person prohibited from receiving the “technology” or “software.”

(4) Shipping, moving, or transferring items between or among the United States, the District of Columbia, the Commonwealth of Puerto Rico, or the Commonwealth of the Northern Mariana Islands or any territory, dependency, or possession of the United States as listed in Schedule C, Classification Codes and Descriptions for U.S. Export Statistics, issued by the Bureau of the Census.

(5) Sending, taking, or storing “technology” or “software” that is:

(i) Unclassified;

(ii) Secured using ‘end-to-end encryption;'

(iii) Secured using cryptographic modules (hardware or “software”) compliant with Federal Information Processing Standards Publication 140-2 (FIPS 140-2) or its successors, supplemented by “software” implementation, cryptographic key management and other procedures and controls that are in accordance with guidance provided in current U.S. National Institute for Standards and Technology publications, or other equally or more effective cryptographic means; and

(iv) Not intentionally stored in a country listed in Country Group D:5 (see Supplement No. 1 to part 740 of the EAR) or in the Russian Federation.

Note to paragraph (a)(4)(iv):

Data in-transit via the Internet is not deemed to be stored.

(b) Definitions. For purposes of this section, End-to-end encryption means (i) the provision of cryptographic protection of data such that the data is not in unencrypted form between an originator (or the originator's in-country security boundary) and an intended recipient (or the recipient's in-country security boundary), and (ii) the means of decryption are not provided to any third party. The originator and the recipient may be the same person.

(c) Ability to access “technology” or “software” in encrypted form. The ability to access “technology” or “software” in encrypted form that satisfies the criteria set forth in paragraph (a)(5) of this section does not constitute the release or export of such “technology” or “software.”

15. Section 734.19 is added to read as follows:
§ 734.19 Transfer of access information.

To the extent an authorization would be required to transfer “technology” or “software,” a comparable authorization is required to transfer access information if done with “knowledge” that such transfer would result in the release of such “technology” or “software” without a required authorization.

16. Section 734.20 is added to read as follows:
§ 734.20 Activities that are not deemed reexports.

The following activities are not deemed reexports (see “deemed reexport” definition in § 734.14(b)):

(a) Authorized Release of “technology” or source code. Release of “technology” or source code by an entity outside the United States to a foreign person of a country other than the foreign country where the release takes place if:

(1) The entity is authorized to receive the “technology” or source code at issue, whether by a license, license exception, or situation where no license is required under the EAR for such “technology” or source code; and

(2) The entity has “knowledge” that the foreign national's most recent country of citizenship or permanent residency is that of a country to which export from the United States of the “technology” or source code at issue would be authorized by the EAR either under a license exception or in situations where no license under the EAR would be required.

(b) Release to Country Group A:5 nationals. Without limiting the scope of paragraph (a), release of “technology” or source code by an entity outside the United States to a foreign person of a country other than the foreign country where the release takes place if:

(1) The entity is authorized to receive the “technology” or source code at issue, whether by a license, license exception, or through situations where no license is required under the EAR;

(2) The foreign person is a bona fide `permanent and regular employee' of the entity and is not a proscribed person (see § 772.1 for definition of proscribed person);

(3) Such employee is a national exclusively of a country in Country Group A:5; and

(4) The release of “technology” or source code takes place entirely within the physical territory of any such country, or within the United States.

(c) Release to other than Country Group A:5 nationals. Without limiting the scope of paragraph (a), release of “technology” or source code by an entity outside the United States to a foreign person of a country other than the foreign country where the release takes place if:

(1) The entity is authorized to receive the “technology” or source code at issue, whether by a license, license exception, or situations where no license is required under the EAR;

(2) The foreign person is a bona fide `permanent and regular employee' of the entity and is not a proscribed person (see § 772.1 for definition of proscribed person);

(3) The release takes place entirely within the physical territory of the country where the entity is located, conducts official business, or operates, or within the United States;

(4) The entity has effective procedures to prevent diversion to destinations, entities, end users, and end uses contrary to the EAR; and

(5) Any one of the following six (i.e., paragraphs (c)(5)(i), (ii), (iii), (iv), (v), or (vi) of this section) situations is applicable:

(i) The foreign person has a security clearance approved by the host nation government of the entity outside the United States;

(ii) The entity outside the United States:

(A) Has in place a process to screen the foreign person employee and to have the employee execute a non-disclosure agreement that provides assurances that the employee will not disclose, transfer, or reexport controlled “technology” contrary to the EAR;

(B) Screens the employee for substantive contacts with countries listed in Country Group D:5 (see Supplement No. 1 to part 740 of the EAR). Although nationality does not, in and of itself, prohibit access to “technology” or source code subject to the EAR, an employee who has substantive contacts with foreign persons from countries listed in Country Group D:5 shall be presumed to raise a risk of diversion, unless BIS determines otherwise;

(C) Maintains a technology security or clearance plan that includes procedures for screening employees for such substantive contacts;

(D) Maintains records of such screenings for the longer of five years or the duration of the individual's employment with the entity; and

(E) Will make such plans and records available to BIS or its agents for civil and criminal law enforcement purposes upon request;

(iii) The entity is a U.K. entity implementing § 126.18 of the ITAR (22 CFR 126.18) pursuant to the U.S.-U.K. Exchange of Notes regarding § 126.18 of the ITAR for which the U.K. has provided appropriate implementation guidance;

(iv) The entity is a Canadian entity implementing § 126.18 of the ITAR pursuant to the U.S.-Canadian Exchange of Letters regarding § 126.18 of the ITAR for which Canada has provided appropriate implementation guidance;

(v) The entity is an Australian entity implementing the exemption at paragraph 3.7b of the ITAR Agreements Guidelines; or

(vi) The entity is a Dutch entity implementing the exemption at paragraph 3.7c of the ITAR Agreements Guidelines.

(d) Definitions—(1) Substantive contacts include regular travel to countries in Country Group D:5; recent or continuing contact with agents, brokers, and nationals of such countries; continued demonstrated allegiance to such countries; maintenance of business relationships with persons from such countries; maintenance of a residence in such countries; receiving salary or other continuing monetary compensation from such countries; or acts otherwise indicating a risk of diversion.

(2) Permanent and regular employee is an individual who:

(i) Is permanently (i.e., for not less than a year) employed by an entity, or

(ii) Is a contract employee who:

(A) Is in a long-term contractual relationship with the company where the individual works at the entity's facilities or at locations assigned by the entity (such as a remote site or on travel);

(B) Works under the entity's direction and control such that the company must determine the individual's work schedule and duties;

(C) Works full time and exclusively for the entity; and

(D) Executes a nondisclosure certification for the company that he or she will not disclose confidential information received as part of his or her work for the entity.

Note to paragraph (d)(2):

If the contract employee has been seconded to the entity by a staffing agency, then the staffing agency must not have any role in the work the individual performs other than to provide the individual for that work. The staffing agency also must not have access to any controlled “technology” or source code other than that authorized by the applicable regulations or a license.

Supplement No. 1 to Part 734 [Removed and Reserved] 17. Supplement No. 1 to part 734 is removed and reserved. PART 740— LICENSE EXCEPTIONS 18. The authority citation for part 740 continues to read as follows: Authority:

50 U.S.C. 4601 et seq.; 50 U.S.C. 1701 et seq.; 22 U.S.C. 7201 et seq.; E.O. 13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 228; E.O. 13222, 66 FR 44025, 3 CFR, 2001 Comp., p. 783; Notice of August 7, 2015, 80 FR 48233 (August 11, 2015).

19. In § 740.9, paragraph (a)(3) is revised to read as follows:
§ 740.9 Temporary imports, exports, reexports, and transfers (in-country) (TMP).

(a) * * *

(3) “Technology,” regardless of media or format, may be exported, reexported, or transferred (in-country) by or to a U.S. person, or a foreign person employee of a U.S. person traveling or on temporary assignment abroad, subject to the following restrictions:

(i) Foreign persons may only export, reexport, transfer (in country) or receive such “technology” as they are authorized to receive through a license, license exception other than TMP or because no license is required.

(ii) “Technology” exported, reexported, or transferred under this authorization may only be possessed or used by a U.S. person or authorized foreign person. Sufficient security precautions must be taken to prevent the unauthorized release of the “technology.” Such security precautions may include encryption of the “technology,” the use of secure network connections, such as Virtual Private Networks, the use of passwords or other access restrictions on the electronic device or media on which the “technology” is stored, and the use of firewalls and other network security measures to prevent unauthorized access.

(iii) The individual is an employee of the U.S. Government or is directly employed by a U.S. person and not, e.g., by a foreign subsidiary.

(iv) “Technology” authorized under this exception may not be used for foreign production purposes or for technical assistance unless authorized through a license or license exception other than TMP.

PART 750—APPLICATION PROCESSING, ISSUANCE, AND DENIAL 20. The authority citation for 15 CFR part 750 continues to read as follows: Authority:

50 U.S.C. 4601 et seq.; 50 U.S.C. 1701 et seq.; Sec 1503, Pub. L. 108-11, 117 Stat. 559; E.O. 13026, 61 FR 58767, 3 CFR, 1996 Comp., p. 228; E.O. 13222, 66 FR 44025, 3 CFR, 2001 Comp., p. 783; E.O. 13637, 78 FR 16129, 3 CFR, 2013 Comp., p. 223; Presidential Determination 2003-23, 68 FR 26459, 3 CFR, 2004 Comp., p. 320; Notice of August 7, 2015, 80 FR 48233 (August 11, 2015).

21. Section 750.7 is amended by revising paragraph (a) to read as follows:
§ 750.7 Issuance of licenses.

(a) Scope. Unless limited by a condition set out in a license, the export, reexport, or transfer (in-country) authorized by a license is for the item(s), end-use(s), and parties described in the license application and any letters of explanation. The applicant must inform the other parties identified on the license, such as the ultimate consignees and end users, of the license's scope and of the specific conditions applicable to them. BIS grants licenses in reliance on representations the applicant made in or submitted in connection with the license application, letters of explanation, and other documents submitted. A BIS license authorizing the release of “technology” to an entity also authorizes the release of the same “technology” to the entity's foreign persons who are permanent and regular employees (and who are not proscribed persons) of the entity's facility or facilities authorized on the license, except to the extent a license condition limits or prohibits the release of the “technology” to foreign persons of specific countries or country groups.

PART 772—DEFINITIONS OF TERMS 22. The authority citation for part 772 continues to read as follows: Authority:

50 U.S.C. 4601 et seq.; 50 U.S.C. 1701 et seq.; E.O. 13222, 66 FR 44025, 3 CFR, 2001 Comp., p. 783; Notice of August 7, 2015, 80 FR 48233 (August 11, 2015).

23. Section 772.1 is amended by: a. Adding in alphabetical order a definition for “Access information”; b. Revising the definition of “Export”; c. Adding in alphabetical order definitions for “Foreign person,” “Fundamental research,” “Proscribed person,” and “Publicly available encryption software”; d. Removing the definitions of “Publicly available information” and “Publicly available technology and software”; e. Adding in alphabetical order a definition for “Published”; f. Revising the definition of “Reexport”; g. Adding in alphabetical order a definition for “Release”; h. Revising the definition of “Required”; i. Removing the definition of “Technical data”; and j. Revising the definitions of “Technology,” and “Transfer.”

The revisions and additions read as follows:

§ 772.1 Definitions of terms as used in the Export Administration Regulations (EAR).

Access information. Information that allows access to encrypted technology or encrypted software in an unencrypted form. Examples include decryption keys, network access codes, and passwords.

Export. See § 734.13 of the EAR.

Foreign person. Any natural person who is not a lawful permanent resident of the United States, citizen of the United States, or any other protected individual as defined by 8 U.S.C. 1324b(a)(3). It also means any corporation, business association, partnership, trust, society or any other entity or group that is not incorporated in the United States or organized to do business in the United States, as well as international organizations, foreign governments and any agency or subdivision of a foreign government (e.g., diplomatic mission). “Foreign person” is synonymous with “foreign national,” as used in the EAR, and “foreign person” as used in the International Traffic in Arms Regulations (22 CFR 120.16). This definition does not apply to part 760 of the EAR (Restrictive Trade Practices or Boycotts).

Fundamental research. See § 734.8 of the EAR.

Proscribed person. A person who is prohibited from receiving the items at issue or participating in a transaction that is subject to the EAR without authorization under the EAR, such as persons on the Entity List or denied persons.

Publicly available encryption software. See § 740.13(e) of the EAR.

Published. See § 734.7 of the EAR.

Reexport. See § 734.14 of the EAR.

Release. See § 734.15 of the EAR.

Required. (General Technology Note) —As applied to “technology” or “software,” refers to only that portion of “technology” or “software” which is peculiarly responsible for achieving or exceeding the controlled performance levels, characteristics or functions. Such “required” “technology” or “software” may be shared by different products. For example, assume product “X” is controlled on the CCL if it operates at or above 400 MHz and is not controlled if it operates below 400 MHz. If production technologies “A,” “B,” and “C” allow production at no more than 399 MHz, then technologies “A,” “B,” and “C” are not “required” to produce the controlled product “X”. If technologies “A,” “B,” “C,” “D,” and “E” are used together, a manufacturer can produce product “X” that operates at or above 400 MHz. In this example, technologies “D” and “E” are peculiarly responsible for making the controlled product and are thus “required” technology under the General Technology Note. (See the General Technology Note.)

Note 1 to the definition of Required:

The ITAR and the EAR often divide within each set of regulations or between each set of regulations:

(a) Controls on parts, components, accessories, attachments, and software; and

(b) Controls on the end items, systems, equipment, or other items into which those parts, components, accessories, attachments, and software are to be installed or incorporated.

Note 2 to the definition of Required:

The references to “characteristics” and “functions” are not limited to entries on the CCL that use specific technical parameters to describe the scope of what is controlled. The “characteristics” and “functions” of an item listed are, absent a specific regulatory definition, a standard dictionary's definition of the item. For example, ECCN 9A610.a controls military aircraft specially designed for a military use that are not enumerated in USML paragraph VIII(a). No performance level is identified in the entry, but the control characteristic of the aircraft is that it is specially designed “for military use.” Thus, any technology, regardless of significance, peculiar to making an aircraft “for military use” as opposed to, for example, an aircraft controlled under ECCN 9A991.a, would be technical data “required” for an aircraft specially designed for military use thus controlled under ECCN 9E610.

Note 3 to the definition of Required:

Unclassified technology not specifically enumerated on the USML is “subject to the EAR” if it is “required” for the “development,” “production,” “use,” operation, installation, maintenance, repair, overhaul, or refurbishing (or other terms specified in ECCNs on the CCL that control “technology”) of a commodity or software that is subject to the EAR. Thus, for example, if unclassified technology not specifically enumerated on the USML is “required” for the development or production of a 9A610.x aircraft component that is to be integrated or installed in a USML VIII(a) aircraft, then the “technology” is controlled under ECCN 9E610, not USML VIII(i). Conversely, technical data directly related to, for example, the development or production of a component subject to the ITAR does not become subject to the EAR merely because it is developed or produced with equipment subject to the EAR.

Technology. Technology means:

Information necessary for the “development,” “production,” “use,” operation, installation, maintenance, repair, overhaul, or refurbishing (or other terms specified in ECCNs on the CCL that control “technology”) of an item.

N.B.: Controlled “technology” is defined in the General Technology Note and in the Commerce Control List (Supplement No. 1 to part 774 of the EAR).

Note 1 to definition of Technology:

“Technology” may be in any tangible or intangible form, such as written or oral communications, blueprints, drawings, photographs, plans, diagrams, models, formulae, tables, engineering designs and specifications, computer-aided design files, manuals or documentation, electronic media or information revealed through visual inspection;

Note 2 to definition of Technology:

The modification of the design of an existing item creates a new item and technology for the modified design is technology for the development or production of the new item.

Transfer. A shipment, transmission, or release of items subject to the EAR either within the United States or outside the United States. For In-country transfer/Transfer (in-country), see § 734.16 of the EAR.

Note to definition of Transfer:

This definition of “transfer” does not apply to § 750.10 of the EAR or Supplement No. 8 to part 760 of the EAR. The term “transfer” may also be included on licenses issued by BIS. In that regard, the changes that can be made to a BIS license are the non-material changes described in § 750.7(c) of the EAR. Any other change to a BIS license without authorization is a violation of the EAR. See §§ 750.7(c) and 764.2(e) of the EAR.

Dated: May 23, 2016. Kevin J. Wolf, Assistant Secretary for Export Administration.
[FR Doc. 2016-12734 Filed 6-2-16; 8:45 am] BILLING CODE 3510-33-P
DELAWARE RIVER BASIN COMMISSION 18 CFR Part 420 Clarifying Language in the Basin Regulations—Water Supply Charges Relating to Certificates of Entitlement AGENCY:

Delaware River Basin Commission.

ACTION:

Final rule.

SUMMARY:

The Delaware River Basin Commission is codifying revisions to its Basin Regulations—Water Supply Charges. The revisions involve no changes in the substance or administration of the rule. They were made in order to clarify the language of the rule to conform to the Commission's decisions and practices so as to provide better notice to users regarding how the Commission implements its entitlements program and to avoid future controversy.

DATES:

This final rule is effective July 5, 2016.

FOR FURTHER INFORMATION CONTACT:

Pamela Bush, 609-477-7203.

SUPPLEMENTARY INFORMATION:

Background

The Delaware River Basin Commission (“DRBC” or “Commission”) is a federal-interstate compact agency charged with managing the water resources of the Delaware River Basin on a regional basis without regard to political boundaries. Its members are the governors of the four basin states—Delaware, New Jersey, New York and Pennsylvania—and the North Atlantic Division Commander of the U.S. Army Corps of Engineers, representing the federal government.

By Resolution No. 2006-2 on March 1, 2006, the Commission approved revisions to its Basin Regulations—Water Supply Charges, 18 CFR part 420, to clarify the language of the rule to conform to the Commission's decisions and practices, in order to provide better notice to users regarding how the Commission implements its entitlements program and to avoid future controversy. The revisions involved no changes in the substance or administration of the rule. Although the adopted revisions were incorporated into the Commission's Administrative Manual Part III—Basin Regulations—Water Supply Charges, which uses a unique numbering system, the corresponding sections of the Code of Federal Regulations were never updated to include them. This final rule adds the approved changes to the federal code.

Notice of the proposed revisions was published in the Federal Register at 70 FR 60496, October 18, 2005. Notice also appeared in the Delaware Register of Regulations, 9 DE Reg. 674, November 1, 2005; New Jersey Register, 37 N.J.R. 4206, November 7, 2005; New York State Register, November 2, 2005 (page 4); and Pennsylvania Bulletin, 35 Pa.B. 6094, Nov. 5, 2005. The Commission held a public hearing on the proposed revisions on December 7, 2005 and accepted written comments on them through January 10, 2006. The changes were adopted by unanimous vote approving Resolution No. 2006-2 at the Commission's public business meeting on March 1, 2006.

Additional Materials

Additional materials can be found on the Commission's Web site, www.drbc.net. These include: the notice of the proposed amendments published in the Federal Register, at http://nj.gov/drbc/library/documents/water-charges-codify/1_FR_PropRule_CertsEntitle101805.pdf; and in the state registers at http://www.nj.gov/drbc/about/regulations/other-rulemakings.html; the text of the draft revisions as proposed, at http://nj.gov/drbc/library/documents/water-charges-codify/6_ProposedText_WaterSupplyChargingRegs_Art5.2.pdf; Resolution No. 2006-2, adopting the revisions as final, at http://nj.gov/drbc/library/documents/water-charges-codify/7_Res2006-02_CertEntitle_adopted030106.pdf; and the Minutes of the Commission's business meeting of March 1, 2006, explaining the differences between the proposed and adopted rule text, at http://nj.gov/drbc/library/documents/water-charges-codify/8_Min_030106_note-pgs18-21.pdf.

With adoption of this final rule, the Commission will reference the CFR version of the Basin Regulations—Water Supply Charges for most purposes. For the foreseeable future, however, both versions will remain posted on the Commission's Web site, at http://www.nj.gov/drbc/about/regulations/.

List of Subjects in 18 CFR Part 420

Water supply.

For the reasons set forth in the preamble, the Delaware River Basin Commission amends part 420 of title 18 of the Code of Federal Regulations as follows:

PART 420—BASIN REGULATIONS—WATER SUPPLY CHARGES 1. The authority citation for part 420 continues to read as follows: Authority:

Delaware River Basin Compact, 75 Stat. 688.

2. Revise § 420.31(d) through (f) to read as follows:
§ 420.31 Certificate of entitlement.

(d) Limitations. (1) A certificate of entitlement is granted to a specific user for water withdrawals or diversions at a specific facility in the amount of the Legal Entitlement as defined in § 420.23(b).

(2) A certificate of entitlement shall not be applied, transferred or modified to apply to a facility other than the facility initially specified in the certificate.

(3) A certificate of entitlement may not be transferred from the certificate holder to another user, except as provided in the exceptions set forth in paragraph (f) of this section.

(4) A certificate of entitlement does not exempt the certificate holder from paying water supply charges for any portion of water withdrawals or diversions used outside the facility specified in the certificate and any additional service area to which the facility supplied water as of October 27, 1961 or at the facility specified in the certificate by a user other than the certificate holder. For purposes of this paragraph (d)(4), a certificate holder claiming an exemption from charges for water supplied within a service area shall submit proof satisfactory to the Commission identifying the facility's service area as of October 27, 1961. In the absence of proof of the service area as of October 27, 1961, the service area defined in the Commission docket, if any, for the facility in effect at the time the certificate was issued shall be deemed to be the facility's service area. In the absence of proof of a service area, the certificate shall only exempt the certificate holder from paying water supply charges for water used at the facility.

(e) Termination of certificate. (1) A certificate of entitlement terminates pursuant to this section and without the need for Commission action if at least one of the following occurs:

(i) The certificate holder dissolves or otherwise ceases to exist;

(ii) The certificate holder ceases the withdrawals or diversions at the facility to which the certificate of entitlement applies, or abandons the intake, provided that a shutdown of the facility for maintenance or improvement, or a replacement of the intake, that is performed at the earliest practicable commercially reasonable time following commencement of the shutdown or replacement, shall not be deemed to be a cessation of withdrawal or diversion;

(iii) The certificate holder through contract, lease or other agreement ceases to be the user or public water system supplier of the water withdrawn or diverted at the facility; or

(iv) There is a change in the ownership or control of the facility. Once terminated, a certificate of entitlement may not be reinstated or reissued.

(2) A change in ownership or control of the facility includes, but is not limited to, any transaction, acquisition, merger or event (collectively “transaction”) resulting in at least one of the following:

(i) A transfer of title to the facility;

(ii) A person or entity or the shareholders or other owners of an entity becoming the beneficial owner, directly or indirectly, or acquiring alone or in concert the power or right to vote at least 20 percent of any class of ownership interest in a certificate holder or any of its parent entities, regardless of the tier in the corporate or entity structure at which the transaction occurs;

(iii) A change in ownership or control for purposes of any of the certificate holder's or any of its parent corporations' employee agreements; or

(iv) A change of the de facto controlling interest in a certificate holder or any of its parent entities, regardless of the tier in the corporate or entity structure at which the change occurs.

(3) A change of the de facto controlling interest in an entity includes, but is not limited to, a change of the persons or entities with the ability or authority, expressed or reserved, to direct the management or policies of an entity and/or to take at least one of the following actions:

(i) Amend or change the entity's identity (e.g. joint venture agreement, unincorporated business status);

(ii) Appoint or remove at least 50% of the members of the Board of Directors or Trustees of a corporation, general partner of a partnership, or a similar member of the governing body of an entity;

(iii) Amend or change the by-laws, constitution, or other operating or management direction of the entity;

(iv) Control the sale of, use of or access to any or all of the entity's assets;

(v) Encumber the entity's assets by way of mortgage or other indebtedness;

(vi) Control any or all of the assets or other property of the entity upon the sale or dissolution of the entity;

(vii) Dissolve the entity;

(viii) Arrange for the sale or transfer of the entity to a new ownership or control;

(ix) Select or change the management of the entity or determine management compensation; or

(x) Set operating policies, financial policies or budgets.

(4) For purposes of applying paragraph (e)(3) of this section, consideration may be given to circumstances particular to the person or entity and certificate holder involved, including without limitation the ability of that person or entity to take actions in light of the number of shares in the certificate holder or its parent entities that are actively voted, the practice of any majority shareholder in exercising or refraining from exercising majority rights, and any agreements giving the person or entity the right to control votes of others.

(5) A series of transactions undertaken pursuant to a plan or that are otherwise related shall be considered a single transaction for purposes of this section. For purposes of calculating the twenty percent threshold in paragraph (e)(2)(ii) of this section, the securities, shares or other interests held immediately prior to the transaction shall be added to the securities, shares or other interests acquired in the transaction.

(f) Exceptions-(1) Agricultural exception. (i) Whenever ownership or possession of land in agricultural use is transferred, any certificate of entitlement with respect to such land shall be deemed to run with the land, if but only if within sixty days following the land transfer the new user demonstrates to the Executive Director that it will continue to use the water withdrawn or diverted for agricultural irrigation. Following any such timely demonstration, the Executive Director shall transfer the certificate of entitlement to the new user. The Executive Director may extend the sixty day period for good cause shown.

(ii) A certificate of entitlement that has been transferred pursuant to paragraph (f)(1)(i) of this section relieves the user of the obligation to pay water supply charges only with respect to the quantity of water in fact used by the new certificate holder for agricultural irrigation up to the Legal Entitlement specified in the certificate, and not with respect to the quantity of water used for any other purposes. The provisions of § 420.43 shall apply to water uses outside the scope of the certificate of entitlement.

(iii) A certificate of entitlement that has been transferred pursuant to paragraph (f)(1)(i) of this section terminates pursuant to this paragraph (f)(1) and without the need for Commission action if and when the certificate holder ceases using the water for agricultural irrigation, provided that if the cessation occurs in conjunction with a transfer of ownership or possession of the land in agricultural use, the certificate of entitlement may be transferred to a new user pursuant to paragraph (f)(1)(i). Once terminated, a certificate of entitlement may not be reinstated or reissued.

(2) Corporate reorganization exceptions. The following provisions apply where a corporate parent directly or indirectly owning 100% of each class of shares of all of its subsidiary corporations decides to reorganize those subsidiary corporations without affecting the corporate parent's 100% ownership interest.

(i) Whenever a corporate reorganization consists solely of a change of the name, identity, internal corporate structure, or place of organization of a corporate certificate holder or any of its parent corporations, the Executive Director may reissue a certificate of entitlement in the name of the new owner of the facility, provided that the reorganization does not affect ownership and/or control by the certificate holder's corporate family of companies within the meaning of paragraphs (e)(2) through (5) of this section and does not alter the ultimate corporate parent's 100% ownership interest.

(ii) A merger or other plan, transaction or series of transactions that effectuates a change of ownership or control within the meaning of paragraphs (e)(2) through (5) does not fall within the exemption of paragraph (f)(2)(i) of this section on the basis that a corporate reorganization constitutes part of the merger, plan, transaction or series of transactions.

Dated: May 26, 2016. Pamela M. Bush, Commission Secretary and Assistant General Counsel.
[FR Doc. 2016-13011 Filed 6-2-16; 8:45 am] BILLING CODE 6301-01-P
DEPARTMENT OF HEALTH AND HUMAN SERVICES Food and Drug Administration 21 CFR Part 573 [Docket No. FDA-2014-F-0232] Food Additives Permitted in Feed and Drinking Water of Animals; Chromium Propionate AGENCY:

Food and Drug Administration, HHS.

ACTION:

Final rule.

SUMMARY:

The Food and Drug Administration (FDA, we, or the Agency) is amending the regulations for food additives permitted in feed and drinking water of animals to provide for the safe use of chromium propionate as a source of chromium in broiler chicken feed. This action is in response to a food additive petition filed by Kemin Industries, Inc.

DATES:

This rule is effective June 3, 2016. Submit either written or electronic objections and requests for a hearing by July 5, 2016. See section V of this document for information on the filing of objections.

ADDRESSES:

You may submit comments or written objections and a request for a hearing as follows:

Electronic Submissions

Submit electronic comments/objections in the following way:

• Federal eRulemaking Portal: http://www.regulations.gov. Follow the instructions for submitting comments. Comments/objections submitted electronically, including attachments, to http://www.regulations.gov will be posted to the docket unchanged. Because your comment/objection will be made public, you are solely responsible for ensuring that your comment/objection does not include any confidential information that you or a third party may not wish to be posted, such as medical information, your or anyone else's Social Security number, or confidential business information, such as a manufacturing process. Please note that if you include your name, contact information, or other information that identifies you in the body of your comments/objection, that information will be posted on http://www.regulations.gov.

• If you want to submit a comment/objection with confidential information that you do not wish to be made available to the public, submit the comment/objection as a written/paper submission and in the manner detailed (see “Written/Paper Submissions” and “Instructions”).

Written/Paper Submissions

Submit written/paper submissions as follows:

Mail/Hand delivery/Courier (for written/paper submissions): Division of Dockets Management (HFA-305), Food and Drug Administration, 5630 Fishers Lane, Rm. 1061, Rockville, MD 20852.

• For written/paper comments/objections submitted to the Division of Dockets Management, FDA will post your comment, as well as any attachments, except for information submitted, marked and identified, as confidential, if submitted as detailed in “Instructions.”

Instructions: All submissions received must include the Docket No. FDA-2014-F-0232 for “Food Additives Permitted in Feed and Drinking Water of Animals; Chromium Propionate.” Received comments/objections will be placed in the docket and, except for those submitted as “Confidential Submissions,” publicly viewable at http://www.regulations.gov or at the Division of Dockets Management between 9 a.m. and 4 p.m., Monday through Friday.

Confidential Submissions—To submit a comment/objection with confidential information that you do not wish to be made publicly available, submit your comments/objections only as a written/paper submission. You should submit two copies total. One copy will include the information you claim to be confidential with a heading or cover note that states “THIS DOCUMENT CONTAINS CONFIDENTIAL INFORMATION.” The Agency will review this copy, including the claimed confidential information, in its consideration of comments. The second copy, which will have the claimed confidential information redacted/blacked out, will be available for public viewing and posted on http://www.regulations.gov. Submit both copies to the Division of Dockets Management. If you do not wish your name and contact information to be made publicly available, you can provide this information on the cover sheet and not in the body of your comments and you must identify this information as “confidential.” Any information marked as “confidential” will not be disclosed except in accordance with 21 CFR 10.20 and other applicable disclosure law. For more information about FDA's posting of comments to public dockets, see 80 FR 56469, September 18, 2015, or access the information at: http://www.fda.gov/regulatoryinformation/dockets/default.htm.

Docket: For access to the docket to read background documents or the electronic and written/paper comments received, go to http://www.regulations.gov and insert the docket number, found in brackets in the heading of this document, into the “Search” box and follow the prompts and/or go to the Division of Dockets Management, 5630 Fishers Lane, rm. 1061, Rockville, MD 20852.

FOR FURTHER INFORMATION CONTACT:

Chelsea Trull, Center for Veterinary Medicine, Food and Drug Administration, 7519 Standish Pl., Rockville, MD 20855, 240-402-6729, [email protected]

SUPPLEMENTARY INFORMATION: I. Background

In a notice published in the Federal Register of March 10, 2014 (79 FR 13263), FDA announced that we had filed a food additive petition (animal use) (FAP 2282) submitted by Kemin Industries, Inc., 2100 Maury St., Des Moines, IA 50317. The petition proposed to amend the food additive regulations to provide for the safe use of chromium propionate as a source of chromium in broiler chicken feed. The notice of petition was subsequently corrected to indicate the submission of an environmental assessment by the petitioner (79 FR 38478, July 8, 2014).

II. Conclusion

FDA concludes that the data establish the safety and utility of chromium propionate for use as proposed and that the food additive regulations should be amended as set forth in this document.

III. Public Disclosure

In accordance with § 571.1(h) (21 CFR 571.1(h)), the petition and documents we considered and relied upon in reaching our decision to approve the petition will be made available for public disclosure (see FOR FURTHER INFORMATION CONTACT). As provided in § 571.1(h), we will delete from the documents any materials that are not available for public disclosure.

IV. Analysis of Environmental Impact

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

V. Objections and Hearing Requests

Any person who will be adversely affected by this regulation may file with the Division of Dockets Management (see ADDRESSES) either electronic or written objections. Each objection shall be separately numbered, and each numbered objection shall specify with particularity the provision of the regulation to which objection is made and the grounds for the objection. Each numbered objection on which a hearing is requested shall specifically so state. Failure to request a hearing for any particular objection shall constitute a waiver of the right to a hearing on that objection. Each numbered objection for which a hearing is requested shall include a detailed description and analysis of the specific factual information intended to be presented in support of the objection in the event that a hearing is held. Failure to include such a description and analysis for any particular objection shall constitute a waiver of the right to a hearing on the objection.

It is only necessary to send one set of documents. Identify documents with the docket number found in brackets in the heading of this document. Any objections received in response to the regulation may be seen in the Division of Dockets Management between 9 a.m. and 4 p.m., Monday through Friday, and will be posted to the docket at http://www.regulations.gov.

List of Subjects in 21 CFR Part 573

Animal feeds, Food additives.

Therefore, under the Federal Food, Drug, and Cosmetic Act and under authority delegated to the Commissioner of Food and Drugs and redelegated to the Center for Veterinary Medicine, 21 CFR part 573 is amended as follows:

PART 573—FOOD ADDITIVES PERMITTED IN FEED AND DRINKING WATER OF ANIMALS 1. The authority citation for part 573 continues to read as follows: Authority:

21 U.S.C. 321, 342, 348.

2. Add § 573.304 to read as follows:
§ 573.304 Chromium Propionate.

The food additive chromium propionate may be safely used in animal feed as a source of supplemental chromium in accordance with the following prescribed conditions:

(a) The additive is manufactured by the reaction of a chromium salt with propionic acid, at an appropriate stoichiometric ratio, to produce triaqua-(mu3-oxo) hexakis (mu2-propionato-O,O′) trichromium propionate with the empirical formula, [Cr3(O)(CH3CH2CO2)6(H2O)3]CH3CH2CO2.

(b) The additive shall be incorporated at a level not to exceed 0.2 milligrams of chromium from chromium propionate per kilogram feed in broiler chicken complete feed.

(c) The additive meets the following specifications:

(1) Total chromium content, 8 to 10 percent.

(2) Hexavalent chromium content, less than 2 parts per million.

(3) Arsenic, less than 1 part per million.

(4) Cadmium, less than 1 part per million.

(5) Lead, less than 0.5 part per million.

(6) Mercury, less than 0.5 part per million.

(7) Viscosity, not more than 2,000 centipoise.

(d) The additive shall be incorporated into feed as follows:

(1) It shall be incorporated into each ton of complete feed by adding no less than one pound of a premix containing no more than 181.4 milligrams of added chromium from chromium propionate per pound.

(2) The premix manufacturer shall follow good manufacturing practices in the production of chromium propionate premixes. Inventory, production, and distribution records must provide a complete and accurate history of product production.

(3) Chromium from all sources of supplemental chromium cannot exceed 0.2 parts per million of the complete feed.

(e) To assure safe use of the additive in addition to the other information required by the Federal Food, Drug, and Cosmetic Act:

(1) The label and labeling of the additive, any feed premix, and complete feed shall contain the name of the additive.

(2) The label and labeling of the additive and any feed premix shall also contain:

(i) A guarantee for added chromium content.

(ii) Adequate directions for use and cautions for use including this statement: Caution: Follow label directions. Chromium from all sources of supplemental chromium cannot exceed 0.2 parts per million of the complete feed.

Dated: May 26, 2016. Tracey Forfa, Acting Director, Center for Veterinary Medicine.
[FR Doc. 2016-13082 Filed 6-2-16; 8:45 am] BILLING CODE 4164-01-P
DEPARTMENT OF STATE 22 CFR Parts 120, 123, 124, 125, and 126 [Public Notice: 9487] RIN 1400-AD70 International Traffic in Arms: Revisions to Definition of Export and Related Definitions AGENCY:

Department of State.

ACTION:

Interim final rule.

SUMMARY:

As part of the President's Export Control Reform (ECR) initiative, the Department of State amends the International Traffic in Arms Regulations (ITAR) to update the definitions of “export,” and “reexport or retransfer” in order to continue the process of harmonizing the definitions with the corresponding terms in the Export Administration Regulations (EAR), to the extent appropriate. Additionally, the Department creates definitions of “release” and “retransfer” in order to clarify and support the interpretation of the revised definitions that are in this rulemaking. The Department creates new sections of the ITAR detailing the scope of licenses, unauthorized releases of controlled information and revises the section on “exports” of technical data to U.S. persons abroad. Finally, the Department consolidates regulatory provisions on the treatment of foreign dual and third country national employees within one exemption.

DATES:

The rule is effective on September 1, 2016. The Department of State will accept comments on this interim final rule until July 5, 2016.

ADDRESSES:

Interested parties may submit comments within 30 days of the date of publication by one of the following methods:

Email: [email protected] with the subject line, “ITAR Amendment—Final Revisions to Definitions.”

Internet: At www.regulations.gov, search for this notice by using this rule's RIN (1400-AD70).

Comments received after that date may be considered, but consideration cannot be assured. Those submitting comments should not include any personally identifying information they do not desire to be made public or information for which a claim of confidentiality is asserted because those comments and/or transmittal emails will be made available for public inspection and copying after the close of the comment period via the Directorate of Defense Trade Controls Web site at www.pmddtc.state.gov. Parties who wish to comment anonymously may do so by submitting their comments via www.regulations.gov, leaving the fields that would identify the commenter blank and including no identifying information in the comment itself. Comments submitted via www.regulations.gov are immediately available for public inspection.

FOR FURTHER INFORMATION CONTACT:

Mr. C. Edward Peartree, Director, Office of Defense Trade Controls Policy, Department of State, telephone (202) 663-1282; email [email protected] ATTN: ITAR Amendment—Revisions to Definitions. The Department of State's full retrospective plan can be accessed at http://www.state.gov/documents/organization/181028.pdf.

SUPPLEMENTARY INFORMATION:

The Directorate of Defense Trade Controls (DDTC), U.S. Department of State, administers the International Traffic in Arms Regulations (ITAR) (22 CFR parts 120 through 130). The items subject to the jurisdiction of the ITAR, i.e., defense articles and defense services, are identified on the ITAR's U.S. Munitions List (USML) (22 CFR 121.1). With few exceptions, items not subject to the export control jurisdiction of the ITAR are subject to the jurisdiction of the Export Administration Regulations (“EAR,” 15 CFR parts 730 through 774, which includes the Commerce Control List (CCL) in Supplement No. 1 to part 774), administered by the Bureau of Industry and Security (BIS), U.S. Department of Commerce. Both the ITAR and the EAR create license requirements for exports and reexports of controlled items. Items not subject to the ITAR or to the exclusive licensing jurisdiction of any other set of regulations are subject to the EAR.

BIS is concurrently publishing amendments (BIS companion rule) to definitions, including “export,” “reexport,” “release,” and “transfer (in-country)” in the EAR.

Changes in This Rule

The following changes are made to the ITAR with this interim final rule: (i) Revisions to the definitions for “export” and “reexport or retransfer;” (ii) new definitions for “release” and “retransfer;” (iii) new sections of the ITAR detailing the scope of licenses, unauthorized releases of information; (iv) revisions to the section on “exports” of technical data to U.S. persons abroad; and (v) consolidates §§ 124.16 and 126.18 within one exemption. The remaining definitions published in the June 3, 2015 proposed rule (80 FR 31525), will be the subject of separate rulemakings and the public comments on those definitions will be addressed therein.

The Department received several public comments that address the rule as a whole. These comments are addressed here. Comments on a specific definition or other proposed change are addressed below in the relevant section of the rule.

Several commenters replied to DDTC's request for public comments on the effective date described in the proposed rule, suggesting dates ranging from 60 to 180 days. Some commenters also requested that the rule be published as an interim final rule to allow additional public comments. The Department partially accepts these comments. The Department determined that the changes to definitions and additional definitions included in this rule can be implemented with minimal impact on the export control management systems. However, the Department agrees that additional public comment on all aspects of this rule may be beneficial. Therefore, the rule will be effective 90 days from publication, with a public comment period of 30 days to allow the Department to make any necessary improvements to the rule prior to it becoming effective.

One commenter suggested that the Department place all terms defined within the ITAR in quotations marks, as is done in the EAR. The Department does not accept this comment. The Department has determined that the addition of quotation marks will not enhance the readability of the ITAR.

Several commenters noted that the revised and new definitions in the proposed rule created layered definitions, where exporters must understand multiple definitions of words used within a definition. The Department recognizes that the new definitions require additional study of the new regulations.

One commenter suggested that the Department harmonize § 126.1 with the list of restricted destinations under the EAR, specifically Crimea. The Department does not accept this comment. The imposition of a license requirement under the EAR is not the same as a presumption of denial for exports to a destination listed under § 126.1. All defense articles require authorization from the Department for “export” or “reexport” to, or “retransfer” within, Ukraine and Russia, and all applications are processed consistent with U.S. government policy.

One commenter requested that the Department adopt an intra-company transfer exception, authorizing exports and reexports between company facilities in different destinations. This suggestion is outside the scope of the rulemaking and the Department does not accept the comment.

1. Export Definition Revised

The Department revises the definition of “export” in § 120.17 to better align with the EAR's revised definition of the term and to remove activities associated with the further movement of a defense article or its “release” outside the United States, which now fall within the definition of “reexport” in § 120.19 or “retransfer” in § 120.51. The definition is revised to explicitly identify that §§ 126.16 and 126.17 (exemptions pursuant to the Australia and United Kingdom Defense Trade Cooperation Treaties) have their own definitions of “export,” which apply exclusively to those exemptions.

Although the wording of paragraph (a)(1) of this section has changed, the scope of the control is the same. Paragraph (a)(2) includes the control listed in the former paragraph (a)(4) (transfer of technical data to a foreign person). Paragraph (a)(3) includes the control listed in the former paragraph (a)(2) (transfer of registration, control, or ownership to a foreign person of an aircraft, vessel, or satellite). Paragraph (a)(4) includes the control listed in the former paragraph (a)(3) (transfer in the United States to foreign embassies). Paragraph (a)(5) maintains the control on performing a defense service. Paragraph (a)(6) is retained from the existing text to continue to advise exporters that the launch of a launch vehicle or payload does not constitute an export, but may involve a defense service. Paragraph (b) is added to clarify that disclosing technical data to a foreign person in the United States is deemed to be an “export” to all countries in which the foreign person holds or has held citizenship or holds permanent residency.

In response to public comments, the Department revised proposed paragraph (a)(4) to clarify that it is the “release” or transfer to an embassy or one of its agencies or subdivisions that is the activity of concern. This includes transfers to employees of an embassy or other foreign persons who will take the defense article to an embassy.

The Department also removed proposed paragraphs (a)(6) and (7). Proposed paragraph (a)(6) is no longer necessary, and the Department will address controls on encrypted technical data in a separate rulemaking. Proposed paragraph (a)(7) will also be addressed in a separate rulemaking, and until such time, the existing ITAR controls remain in place.

One commenter suggested that the Department adopt the definition of “export” that was in the EAR, which states “[e]xport means an actual shipment or transmission of items out of the United States,” and state that the other activities identified in § 120.17 are “subject to the regulations in the same manner and with the same effect as an export.” The Department does not accept this comment. All of the activities identified in this section are an “export.”

Several commenters stated that the definition of “export” is too broad, as individuals may share information that they do not believe to be technical data and accidentally violate the ITAR. The Department does not accept this comment. For information to be ITAR-controlled, it must be directly related to a defense article or specifically enumerated on the USML, and not satisfy one of the exclusions in § 120.10(b).

One commenter suggested that the Department revise paragraphs (a)(1) and (2) so that (a)(1) includes only hardware exports and (a)(2) includes all technical data exports, whether to a foreign person in the United States or to someone in another country. The Department does not accept this comment. A major purpose of this rule is to harmonize the ITAR with the EAR, and the Department determined it would better align the definition of “export” by adopting the EAR's framework of including one paragraph for an “export” that moves a defense article to another country, whether tangible or intangible, and another paragraph that addresses the “export” of technical data to foreign persons in the United States.

One commenter suggested that the changes to paragraph (a)(2), which define transfers to a foreign person in the United States as an “export,” and transfers to a foreign person outside the United States, but within one foreign country, as a “reexport” under § 120.19(a)(2), would preclude a U.S. company from obtaining a DSP-5 to authorize their overseas foreign national employee to receive technical data. The Department does not accept this comment. The sending or taking of technical data out of the United States to a foreign person employee will remain an “export” under paragraph (a)(1).

One commenter requested that the Department exclude software object code from paragraph (a)(2) so that the provision of ITAR-controlled object code to a foreign person is not an “export.” The Department does not accept this comment. Due to the sensitivity of items that remain defense articles following the revisions on the USML through ECR, retaining those items that provide the United States a critical military or intelligence advantage, ITAR control of the “release” of object code that is within the scope of the USML to foreign persons is appropriate.

Several commenters requested that the Department remove the portion of (a)(6) that addressed the provision of physical access to technical data. The Department has removed paragraph (a)(6). However, as described above for paragraph (a)(7), while the act of providing physical access does not constitute an “export,” any release of technical data to a foreign person is an “export,” “reexport,” or “retransfer” and will require authorization from the Department. If a foreign person views or accesses technical data as a result of being provided physical access, then an “export” requiring authorization will have occurred and the person who provided the foreign person with physical access to the technical data is an exporter responsible for ITAR compliance.

A commenter suggested that the Department revise paragraph (b) to state that only the last country of citizenship or permanent residency will be considered for foreign persons, to harmonize with the EAR. The Department does not accept this comment. A main tenet of ECR is that the ITAR will have higher walls around fewer, more sensitive items, and this aspect of the control system is an example of the more stringent controls that the ITAR maintains.

One commenter noted that the preamble to the proposed rule and paragraph (b) are inconsistent because the preamble language was not limited to “releases” in the United States. The Department confirms that a disclosure to a foreign person in the United States is an “export,” while a “release” to a third-country foreign person abroad is a “reexport,” and a “release” to a foreign person within their own country is a “retransfer.” However, all such activities require authorization, and all citizenships held and any permanent residency status must be accounted for in the authorization.

One commenter requested the Department define permanent residency. The Department notes that permanent resident is defined at 8 U.S.C. Chapter 12, Immigration and Nationality, for the purpose of U.S. law. For the purpose of the ITAR related to third-country foreign persons in a foreign country, the Department generally considers the right to reside in the country indefinitely, be employed by an employer in the country, to make unlimited entry and exit to/from the country without a visa, and rights of voting or office holding in making a determination.

2. Reexport Definition Revised

The Department revises the definition of “reexport” in § 120.19 to better align with the EAR's revised definition and describe transfers of items subject to the jurisdiction of the ITAR between two foreign countries. The activities identified are the same as those in paragraphs (a)(1) through (3) of the revised definition of “export,” except that the shipment, “release,” or transfer is between two foreign countries or is to a third country national foreign person outside of the United States.

One commenter requested that the Department address the implications of § 124.16 and § 126.18 on the control in § 120.19(a)(2). The Department notes that § 120.19(a)(2) does not impose a new license requirement. However, the Department has determined that the authorization that may be requested for an agreement under § 124.16 may be used for any authorization from the Department. Therefore, § 124.16 is converted into an exemption and moved to § 126.18(d).

One commenter requested that the Department state that no “reexport” occurs if an item is moved from one foreign country to another either under the possession of the same end user or by being sent to the same end user. The Department does not accept this comment. Any movement of a defense article between two foreign countries is a “reexport” and requires an authorization. However, an “export” authorization may authorize further “reexport.”

3. Release Definition Added

The Department adds a definition of “release” in § 120.50. This term is added to harmonize with the EAR, which has long used the term to cover activities that disclose information to foreign persons. “Release” includes the activities encompassed within the undefined term “disclose.” The activities that are captured include allowing a foreign person to inspect a defense article in a way that reveals technical data to the foreign person and oral or written exchanges of technical data with a foreign person. The adoption of the definition of “release” does not change the scope of activities that constitute an “export” and other controlled transactions under the ITAR. The word software was removed from the proposed definition of “release” because the Department is not revising the definitions of defense article and technical data at this time, and as such, all ITAR controlled software remains technical data under § 120.10.

Several commenters requested that the Department revise (a)(1) by replacing inspection with examination or “close examination” and state that such inspection or examination must “actually reveal technical data or software” to the foreign person. The Department does not accept this comment. Inspection and examination are synonyms. Adding the modifier “close” may be appropriate in certain circumstances, but other defense articles may not require a close examination for the “release” of technical data to occur. The Department is confident that limiting the control to situations where a visual or other inspection “releases” technical data sets the appropriate scope of control. Additionally, the Department confirms that the information about the defense article must be technical data and not simply attributes, such as size or weight.

4. Retransfer Definition Added

The Department adds a definition of “retransfer” in § 120.51. This interim final rule moves “retransfer” from the definition of “reexport” in § 120.19, better describes the activities being regulated and harmonizes it with the EAR, which controls “exports,” “reexports,” and “transfers (in country)” as discrete events. Under the definition adopted in this interim final rule, a “retransfer” occurs with a change of end use or end user within the same foreign territory. Certain activities may fit within the definition of “reexport” and “retransfer,” such as the disclosure of technical data to a third country national abroad. Authorizations to “reexport” or “retransfer” a defense article are generally issued through the General Correspondence process under § 123.9(c), or by an exemption.

One commenter requested that the Department confirm that the new definition of “retransfer”—i.e., a change in end use or end user—means that authorizations will no longer be required for transfers to subcontractors or intermediate consignees within the same country. The Department does not accept this comment. Providing a defense article to a subcontractor, or any party not explicitly authorized, for additional processing or repair is a change in the end user and end use of the defense article. Such a “retransfer” requires authorization, even if the party is required to return the defense article to the transferor.

One commenter requested that the Department remove “change of end use” from the definition of “retransfer,” asserting that this is an expansion of the scope of activities controlled under the ITAR. The commenter alternatively requested that the Department confirm that the party responsible for any violation due to change in end use is the ultimate consignee. The Department does not accept these comments. Change in end use is within the prior definition of reexport/retransfer that was in § 120.19. An ultimate consignee may also contact the Department to obtain authorization for a change in end use under § 123.9(c). If a violation does occur, the Department will assess responsibility pursuant to its civil enforcement authority based on the relative culpability of all of the parties to the transaction. (See, e.g., § 127.1(c)).

5. Exemption for the Export of Technical Data to or for U.S. Persons Abroad Revised

The Department revises § 125.4(b)(9) to better harmonize controls on the “release” of controlled information to U.S. persons abroad and to update the provisions of this section. The most significant updates are that foreign persons authorized to receive technical data in the United States will be eligible to receive that same technical data abroad, when on temporary assignment on behalf of their employer, and that the exemption will now authorize a “reexport” or “retransfer” as well. The revisions also clarify that a person travelling abroad may use this exemption to “export” technical data for their own use abroad. In all events, the technical data must be secured while abroad to prevent unauthorized “release.”

In response to public comments, the Department includes the ability to use this exception to authorize “reexports” and “retransfers,” in addition to “exports.” The Department also revises the introductory text from the proposed text to clarify that the requirement that a person be travelling or on temporary assignment abroad only applies to foreign person employees, maintaining the current scope of the exemption for U.S. persons. Further, the Department removes the additional proposed recordkeeping requirement, as the Department has determined that the recordkeeping requirements in § 123.26 applicable to all exemptions are sufficient.

One commenter noted that the data security provisions appear to be wholly within the control of the person abroad, and not the exporter, at least in instances where the exporter is not also the person abroad. The Department agrees that the person in possession of the technical data abroad will have the primary responsibility for ensuring that the technical data is adequately secured, consistent with paragraph (b)(9)(ii). As with all “exports,” however, the exporter is responsible for ITAR compliance and must, prior to using the exemption, be confident that the person abroad is aware of the requirement and will properly implement the necessary security.

One commenter requested that the Department remove the reference to “encryption of the technical data” from the security provision in subparagraph (ii). The Department partially accepts this comment. Subparagraph (ii) requires that sufficient security precautions be taken and has been revised to clarify that the list of security precautions is exemplary.

One commenter requested that the Department explicitly state that technical data stored on servers in the United States may be accessed by a U.S. person in a foreign country through a secure/encrypted connection, using this exemption. The Department confirms that a U.S. person or authorized foreign person may access technical data in the United States from abroad using a secure connection. This activity constitutes an “export” of the technical data because it is sent to the foreign country, even if only as a transient or temporary document in electronic storage, and such export may be authorized by this exemption.

One commenter requested that the Department include foreign subsidiaries and affiliates of U.S. companies in paragraph (b)(9), so long as the foreign subsidiary or affiliate is authorized to receive the technical data. The Department does not accept this comment. If an authorization exists that allows a foreign subsidiary or affiliate access to technical data, that authorization is an authorization to “export” that technical data to its employees within the approved territory. If the employees are outside of approved territory, they are not authorized to receive the technical data.

One commenter requested that the Department clarify whether a party who followed DDTC guidance in direct conflict with the National Industrial Security Program Operating Manual (NISPOM), as provided by subparagraph (v), would be at risk of violating the NISPOM. The Department notes that the Secretary of State has the authority to impose different conditions on “exports” apart from those imposed by the Department of Defense, as noted in 71 FR 20534, 20535 (April 21, 2006), and that this paragraph is not being revised by the current rulemaking.

One commenter requested that the Department clarify whether a U.S. person sending or taking technical data overseas on an encrypted device for his personal use or use by another U.S. person is engaged in an “export.” As noted above, the Department will address the proposed § 120.52(a)(4) in a separate rulemaking.

One commenter requested that the Department insert a note cross-referencing to § 120.52 for other options for sending information to persons abroad. As noted above, the Department will address the proposed § 120.52 in a separate rulemaking.

One commenter stated that this section implies that technical data sent to a foreign country in compliance with the proposed § 120.52(a)(4) is an “export.” As noted above, the Department will address the proposed § 120.52 in a separate rulemaking.

6. Scope of License Added

The Department adds § 123.28 and § 124.1(e) to clarify the scope of a license, in the absence of a proviso, and to state that authorizations are granted based on the information provided by the applicant. This means that while providing false information to the U.S. government as part of the application process for the “export,” “reexport,” or “retransfer” of a defense article or the performance of a defense service is a violation of the ITAR (see § 127.2(a)), the Department may also deny, revoke, suspend, or amend the license under § 126.7(a) as a result of the false information.

One commenter suggested that the Department not adopt these sections, as an exporter could identify a defense article, end user, or end use in the supporting documentation for a license application that the Department did not intend to authorize in the license itself. The Department does not accept this comment. The Department reviews all information submitted by an applicant and includes provisos to condition the scope of the authorization to the defense articles, parties, and end uses that are intended to be authorized.

Request for Comments

The Department invites public comment on any of the definitions set forth in this rulemaking.

Regulatory Findings Administrative Procedure Act

The Department of State is of the opinion that controlling the import and export of defense articles and services is a foreign affairs function of the U. S. government and that rules implementing this function are exempt from sections 553 (rulemaking) and 554 (adjudications) of the Administrative Procedure Act (APA). Although the Department is of the opinion that this rulemaking is exempt from the rulemaking provisions of the APA, the Department is publishing this rule with a 30-day provision for public comment and without prejudice to its determination that controlling the import and export of defense articles and defense services is a foreign affairs function.

Regulatory Flexibility Act

Since the Department is of the opinion that this rulemaking is exempt from the rulemaking provisions of 5 U.S.C. 553, there is no requirement for an analysis under the Regulatory Flexibility Act.

Unfunded Mandates Reform Act of 1995

This rulemaking does not involve a mandate that will result in the expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of $100 million or more in any year and it will not significantly or uniquely affect small governments. Therefore, no actions were deemed necessary under the provisions of the Unfunded Mandates Reform Act of 1995.

Small Business Regulatory Enforcement Fairness Act of 1996

For purposes of the Small Business Regulatory Enforcement Fairness Act of 1996 (the “Act”), a major rule is a rule that the Administrator of the OMB Office of Information and Regulatory Affairs finds has resulted or is likely to result in: (1) An annual effect on the economy of $100,000,000 or more; (2) a major increase in costs or prices for consumers, individual industries, federal, state, or local government agencies, or geographic regions; or (3) significant adverse effects on competition, employment, investment, productivity, innovation, or on the ability of United States-based enterprises to compete with foreign-based enterprises in domestic and foreign markets.

The Department does not believe this rulemaking will have an annual effect on the economy of $100,000,000 or more, nor will it result in a major increase in costs or prices for consumers, individual industries, federal, state, or local government agencies, or geographic regions, or have significant adverse effects on competition, employment, investment, productivity, innovation, or on the ability of United States-based enterprises to compete with foreign-based enterprises in domestic and foreign markets. The proposed means of solving the issue of data protection are both familiar to and extensively used by the affected public in protecting sensitive information.

Executive Orders 12372 and 13132

This rulemaking will not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government. Therefore, in accordance with Executive Order 13132, it is determined that this rulemaking does not have sufficient federalism implications to require consultations or warrant the preparation of a federalism summary impact statement. The regulations implementing Executive Order 12372 regarding intergovernmental consultation on Federal programs and activities do not apply to this rulemaking.

Executive Orders 12866 and 13563

Executive Orders 12866 and 13563 direct agencies to assess costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributed impacts, and equity). The executive orders stress the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This rulemaking has been designated a “significant regulatory action,” although not economically significant, under section 3(f) of Executive Order 12866. Accordingly, the rulemaking has been reviewed by the Office of Management and Budget (OMB).

Executive Order 12988

The Department of State has reviewed the rulemaking in light of sections 3(a) and 3(b)(2) of Executive Order 12988 to eliminate ambiguity, minimize litigation, establish clear legal standards, and reduce burden.

Executive Order 13175

The Department of State has determined that this rulemaking will not have tribal implications, will not impose substantial direct compliance costs on Indian tribal governments, and will not preempt tribal law. Accordingly, Executive Order 13175 does not apply to this rulemaking.

Paperwork Reduction Act

This rulemaking does not impose any new reporting or recordkeeping requirements subject to the Paperwork Reduction Act, 44 U.S.C. Chapter 35; however, the Department of State seeks public comment on any unforeseen potential for increased burden.

List of Subjects 22 CFR 120 and 125

Arms and munitions, Classified information, Exports.

22 CFR 123

Arms and munitions, Exports, Reporting and recordkeeping requirements.

22 CFR Part 124

Arms and munitions, Exports, Technical assistance.

22 CFR 126

Arms and munitions, Exports.

Accordingly, for the reasons set forth above, title 22, chapter I, subchapter M, parts 120, 123, 124, 125, and 126 are amended as follows:

PART 120—PURPOSE AND DEFINITIONS 1. The authority citation for part 120 continues to read as follows: Authority:

Secs. 2, 38, and 71, Pub. L. 90-629, 90 Stat. 744 (22 U.S.C. 2752, 2778, 2797); 22 U.S.C. 2794; 22 U.S.C. 2651a; Pub. L. 105-261, 112 Stat. 1920; Pub. L. 111-266; Section 1261, Pub. L. 112-239; E.O. 13637, 78 FR 16129.

2. Section 120.17 is revised to read as follows:
§ 120.17 Export.

(a) Except as set forth in § 126.16 or § 126.17, export means:

(1) An actual shipment or transmission out of the United States, including the sending or taking of a defense article out of the United States in any manner;

(2) Releasing or otherwise transferring technical data to a foreign person in the United States (a “deemed export”);

(3) Transferring registration, control, or ownership of any aircraft, vessel, or satellite subject to the ITAR by a U.S. person to a foreign person;

(4) Releasing or otherwise transferring a defense article to an embassy or to any of its agencies or subdivisions, such as a diplomatic mission or consulate, in the United States;

(5) Performing a defense service on behalf of, or for the benefit of, a foreign person, whether in the United States or abroad; or

(6) A launch vehicle or payload shall not, by reason of the launching of such vehicle, be considered an export for purposes of this subchapter. However, for certain limited purposes (see § 126.1 of this subchapter), the controls of this subchapter may apply to any sale, transfer or proposal to sell or transfer defense articles or defense services.

(b) Any release in the United States of technical data to a foreign person is deemed to be an export to all countries in which the foreign person has held or holds citizenship or holds permanent residency.

3. Section 120.19 is revised to read as follows:
§ 120.19 Reexport.

(a) Reexport means:

(1) An actual shipment or transmission of a defense article from one foreign country to another foreign country, including the sending or taking of a defense article to or from such countries in any manner;

(2) Releasing or otherwise transferring technical data to a foreign person who is a citizen or permanent resident of a country other than the foreign country where the release or transfer takes place (a “deemed reexport”); or

(3) Transferring registration, control, or ownership of any aircraft, vessel, or satellite subject to the ITAR between foreign persons.

(b) Any release outside the United States of technical data to a foreign person is deemed to be a reexport to all countries in which the foreign person has held or holds citizenship or holds permanent residency.

4. Section 120.50 is added to read as follows:
§ 120.50 Release.

(a) Technical data is released through:

(1) Visual or other inspection by foreign persons of a defense article that reveals technical data to a foreign person; or

(2) Oral or written exchanges with foreign persons of technical data in the United States or abroad.

(b) [Reserved]

5. Section 120.51 is added to read as follows:
§ 120.51 Retransfer.

A retransfer is a change in end use or end user of a defense article within the same foreign country.

PART 123—LICENSES FOR THE EXPORT AND TEMPORARY IMPORT OF DEFENSE ARTICLES 6. The authority citation for part 123 continues to read as follows: Authority:

Secs. 2, 38, and 71, 90, 90 Stat. 744 (22 U.S.C. 2752, 2778, 2797); 22 U.S.C. 2753; 22 U.S.C. 2651a; 22 U.S.C. 2776; Pub. L. 105-261, 112 Stat. 1920; Sec. 1205(a), Pub. L. 107-228; Section 1261, Pub. L. 112-239; E.O. 13637, 78 FR 16129.

7. Section 123.28 is added to read as follows:
§ 123.28 Scope of a license.

Unless limited by a condition set out in a license, the export, reexport, retransfer, or temporary import authorized by a license is for the item(s), end-use(s), and parties described in the license application and any letters of explanation. DDTC grants licenses in reliance on representations the applicant made in or submitted in connection with the license application, letters of explanation, and other documents submitted.

PART 124—AGREEMENTS, OFF-SHORE PROCUREMENT, AND OTHER DEFENSE SERVICES 8. The authority citation for part 124 continues to read as follows: Authority:

Secs. 2, 38, and 71, 90, 90 Stat. 744 (22 U.S.C. 2752, 2778, 2797); 22 U.S.C. 2651a; 22 U.S.C. 2776; Section 1514, Pub. L. 105-261; Pub. L. 111-266; Section 1261, Pub. L. 112-239; E.O. 13637, 78 FR 16129.

9. Section 124.1 is amended by adding paragraph (e) to read as follows:
§ 124.1 Manufacturing license agreements and technical assistance agreements.

(e) Unless limited by a condition set out in an agreement, the export, reexport, retransfer, or temporary import authorized by a license is for the item(s), end-use(s), and parties described in the agreement, license, and any letters of explanation. DDTC approves agreements and grants licenses in reliance on representations the applicant made in or submitted in connection with the agreement, letters of explanation, and other documents submitted.

§ 124.8 [Amended]
10. Section 124.8 is amended by removing “§§ 124.16 and 126.18” and adding “§ 126.18” in its place in paragraph (5).
§ 124.12 [Amended]
11. Section 124.12 is amended by removing paragraph (a)(10).
§ 124.16 [Removed and Reserved]
12. Section 124.16 is removed and reserved.
PART 125—LICENSES FOR THE EXPORT OF TECHNICAL DATA AND CLASSIFIED DEFENSE ARTICLES 13. The authority citation for part 125 continues to read as follows: Authority:

Secs. 2 and 38, 90, 90 Stat. 744 (22 U.S.C. 2752, 2778); 22 U.S.C. 2651a; E.O. 13637, 78 FR 16129.

14. Section 125.4 is amended by revising paragraph (b)(9) to read as follows:
§ 125.4 Exemptions of general applicability.

(b) * * *

(9) Technical data, including classified information, regardless of media or format, exported, reexported, or retransferred by or to a U.S. person, or a foreign person employee of a U.S. person travelling or on temporary assignment abroad, subject to the following restrictions:

(i) Foreign persons may only export, reexport, retransfer, or receive such technical data as they are authorized to receive through a separate license or other approval.

(ii) The technical data exported, reexported, or retransferred under this authorization may only be possessed or used by a U.S. person or authorized foreign person. Sufficient security precautions must be taken to prevent the unauthorized release of the technical data. Such security precautions may include encryption of the technical data; the use of secure network connections, such as virtual private networks; the use of passwords or other access restrictions on the electronic device or media on which the technical data is stored; and the use of firewalls and other network security measures to prevent unauthorized access.

(iii) The individual is an employee of the U.S. government or is directly employed by a U.S. person and not by a foreign subsidiary.

(iv) Technical data authorized under this exception may not be used for foreign production purposes or for defense services unless authorized through a license or other separate approval.

(v) Classified information is sent or taken outside the United States in accordance with the requirements of the Department of Defense National Industrial Security Program Operating Manual (unless such requirements are in direct conflict with guidance provided by the Directorate of Defense Trade Controls, in which case such guidance must be followed).

PART 126—GENERAL POLICIES AND PROVISIONS 15. The authority citation for part 126 continues to read as follows: Authority:

Secs. 2, 38, 40, 42, and 71, Pub. L. 90-629, 90 Stat. 744 (22 U.S.C. 2752, 2778, 2780, 2791, and 2797); 22 U.S.C. 2651a; 22 U.S.C. 287c; E.O. 12918, 59 FR 28205; 3 CFR, 1994 Comp., p. 899; Sec. 1225, Pub. L. 108-375; Sec. 7089, Pub. L. 111-117; Pub. L. 111-266; Sections 7045 and 7046, Pub. L. 112-74; E.O. 13637, 78 FR 16129.

16. Section 126.18 is amended by removing “§ 124.16” in paragraph (a) and adding “paragraph (d) of this section” in its place, and adding paragraph (d).

The addition reads as follows:

§ 126.18 Exemptions regarding intra-company, intra-organization, and intra-governmental transfers to employees who are dual nationals or third-country nationals.

(d) Notwithstanding any other provisions of this subchapter, no approval is needed from the Directorate of Defense Trade Controls (DDTC) for the reexport of unclassified defense articles or defense services to individuals who are dual national or third-country national employees of a foreign business entity, foreign governmental entity, or international organization, that is an authorized end-user, foreign signatory, or consignee (including approved sub-licensees) for those defense articles or defense services, when such individuals are:

(1) Bona fide regular employees directly employed by the foreign business entity, foreign governmental entity, or international organization;

(2) Nationals exclusively of countries that are members of NATO, the European Union, Australia, Japan, New Zealand, or Switzerland;

(3) Within the physical territories of the countries listed in paragraph (d)(2) of this section or the United States during the reexport;

(4) Signatory to a Non-Disclosure Agreement, unless their employer is a signatory or sublicensee to an agreement under § 124.1 authorizing those defense articles or defense services; and

(5) Not the recipient of any permanent transfer of hardware.

Dated: May 23, 2016. Rose E. Gottemoeller, Under Secretary, Arms Control and International Security, Department of State.
[FR Doc. 2016-12732 Filed 6-2-16; 8:45 am] BILLING CODE 4710-25-P
DEPARTMENT OF HOMELAND SECURITY Coast Guard 33 CFR Part 100 [Docket Number USCG-2016-0385] RIN 1625-AA08 Special Local Regulation; Tri-City Water Follies Spring Testing, Kennewick, WA AGENCY:

Coast Guard, DHS.

ACTION:

Temporary interim rule; request for comments.

SUMMARY:

The Coast Guard is establishing a Special Local Regulation for all navigable waters within the Columbia River in the vicinity of Columbia Park, commencing at the Interstate 395 Bridge and continuing up river approximately 2.0 miles and terminating at the northern end of Wade Island, during the Tri-City Water Follies Spring Testing event. The special local regulation is needed to protect personnel, vessels, and the marine environment from potential hazards created by high-speed watercraft. Entry of vessels or persons into this area is prohibited unless specifically authorized by the Captain of the Port Columbia River or his designated representative.

DATES:

This rule is effective from June 3, 2016 through June 10, 2016 at 6 p.m. This rule will be enforced from June 10, 2016 at 7 a.m. through June 10, 2016 at 6 p.m. Comments and related material must be received by the Coast Guard on or before July 5, 2016.

ADDRESSES:

To view documents mentioned in this preamble as being available in the docket, go to http://www.regulations.gov, type USCG-2016-0385 in the “SEARCH” box and click “SEARCH.” Click on Open Docket Folder on the line associated with this rule. You may submit comments identified by docket number USCG-2016-0385 using the Federal eRulemaking Portal at http://www.regulations.gov. See the “Public Participation and Request for Comments” portion of the SUPPLEMENTARY INFORMATION section for further instructions on submitting comments.

FOR FURTHER INFORMATION CONTACT:

If you have questions on this rule, call or email Mr. Kenneth Lawrenson, Waterways Management Division, Marine Safety Unit Portland, U.S. Coast Guard; telephone 503-240-9319, email [email protected]

SUPPLEMENTARY INFORMATION:

I. Table of Abbreviations CFR Code of Federal Regulations DHS Department of Homeland Security FR Federal Register NPRM Notice of proposed rulemaking § Section U.S.C. United States Code II. Background Information and Regulatory History

The Coast Guard is issuing this temporary rule without prior notice and opportunity to comment pursuant to authority under section 4(a) of the Administrative Procedure Act (APA) (5 U.S.C. 553(b)). This provision authorizes an agency to issue a rule without prior notice and opportunity to comment when the agency for good cause finds that those procedures are “impracticable, unnecessary, or contrary to the public interest.” Under 5 U.S.C. 553(b)(B), the Coast Guard finds that good cause exists for not publishing a Notice of Proposed Rulemaking (NPRM) with respect to this rule because to do so would be impracticable. The NPRM process would be contrary to public interest in this situation due to the extremely hazardous conditions this event could potentially pose if held without an enforceable special local regulation area. Furthermore, the event staff submitted the application for marine event on March 18, 2016, limiting the Coast Guard to two months to complete an NPRM and full comment period, which is the main factor in our decision to forego the NPRM process.

We are issuing this rule, and under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause exists for making it effective less than 30 days after publication in the Federal Register. Delaying the effective date until 30 days after publication would be impracticable, for the reasons stated above.

III. Legal Authority and Need for Rule

The Coast Guard is issuing this rule under authority in 33 U.S.C. 1231. The Captain of the Port Columbia River (COTP) has determined that potential hazards associated with high-speed watercraft will be a safety concern for anyone within Columbia River mile 330 and 332 during the event hours. This rule is needed to protect personnel, vessels, and the marine environment in the navigable waters within the special local regulation area during the event hours.

IV. Discussion of the Rule

This rule establishes a special local regulation area from 7 a.m. to 6 p.m. on June 10, 2016. The special local regulation area will cover all navigable waters within the Columbia River in the vicinity of Columbia Park, commencing at the Interstate 395 Bridge and continuing up river approximately 2.0 miles and terminating at the northern end of Wade Island. The duration of the special local regulation area is intended to protect personnel, vessels, and the marine environment in these navigable waters for the entirety of the Tri-City Water Follies Spring Testing event. No vessel or person will be permitted to enter the special local regulation area specified in this rule without obtaining permission from the COTP or a designated representative.

V. Regulatory Analyses

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

A. Regulatory Planning and Review

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

This regulatory action determination is based on the size, location, and duration. The special local regulation for the Tri-City Water Follies Test event will only be effective from 7 a.m. to 6 p.m. on the date of the test event. Furthermore, the Tri-City Water Follies Test event is directly related to the main Tri-City Water Follies Hydroplane racing event which has occurred annually for the last 50 years and is extremely well received in the Kennewick-Pasco-Richland metropolitan area. Moreover, the Coast Guard will issue Broadcast Notice to Mariners via VHF-FM marine channel 16 about the special local regulation area and the rule allows vessels to seek permission from the COTP or his designated representative to enter the area.

B. Impact on Small Entities

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

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

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

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

C. Collection of Information

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

D. Federalism and Indian Tribal Governments

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

Also, 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. If you believe this rule has implications for federalism or Indian tribes, please contact the person listed in the FOR FURTHER INFORMATION CONTACT section above.

E. Unfunded Mandates Reform Act

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 expenditure, we do discuss the effects of this rule elsewhere in this preamble.

F. Environment

We have analyzed this rule under Department of Homeland Security Management Directive 023-01 and Commandant Instruction M16475.lD, which guide the Coast Guard in complying with the National Environmental Policy Act of 1969(42 U.S.C. 4321-4370f), and have determined that this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. This rule involves a Special Local Regulation for a limited access area lasting less than 12 hours that will prohibit vessels from entering an area encompassing Columbia River mile 330 and 332 unless given permission to do so by the Captain of the Port Columbia River or his designated representative. It is categorically excluded from further review under paragraph 34(h) 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.

G. Protest Activities

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.

List of Subjects in 33 CFR Part 100

Marine safety, Navigation (water), Reporting and recordkeeping requirements, Waterways.

For the reasons discussed in the preamble, the Coast Guard amends 33 CFR part 100 as follows:

PART 100—REGATTAS AND MARINE PARADES 1. The authority citation for part 100 continues to read as follows: Authority:

33 U.S.C. 1233.

2. Add § 100.T13-0385 to read as follows:
§ 100.T13-0385 Special Local Regulation; Tri-City Water Follies Spring Testing, Kennewick, WA.

(a) Regulated area. The following is designated as a special local regulation area:

(1) Location. The special local regulation area covered by this rule will cover all navigable waters within the Columbia River in the vicinity of Columbia Park, commencing at the Interstate 395 Bridge and continuing up river approximately 2.0 miles and terminating at the northern end of Wade Island.

(2) Enforcement period. This special local regulation area is in effect on June 10, 2016 from 7 a.m. to 6 p.m. The rule will be enforced for the duration of the Tri-City Water Follies Spring Testing event. The Coast Guard will inform mariners of any change to this period of enforcement via Broadcast Notice to Mariners.

(b) Regulations. In accordance with the general regulations in 33 CFR part 100, to enter, transit through, anchor in, or remain within the special local regulation area is prohibited unless permission has been authorized by the Captain of the Port or his designated representative.

(1) The following applies to the special local regulation area identified in paragraph (a)(1) of this section.

(i) This special local regulation area is designed to restrict vessel traffic, including all non-motorized vessels, except as may be permitted by the Captain of the Port Columbia River or his designated representative.

(ii) Within this area all vessels will transit at the minimum speed necessary to maintain headway without creating a wake.

(iii) A succession of sharp, short signals by whistle, siren, or horn from vessels patrolling the area under the direction of the U.S. Coast Guard Patrol Commander shall serve as a signal to stop. Vessels signaled shall stop and shall comply with the orders of the patrol vessel personnel; failure to do so may result in expulsion from the area, citation for failure to comply, or both.

(2) [Reserved]

(c) Enforcement. Any Coast Guard commissioned, warrant, or petty officer may enforce the rules in this section. In the navigable waters of the United States to which this section applies, when immediate action is required and representatives of the Coast Guard are not present or are not present in sufficient force to provide effective enforcement of this section, any Federal Law Enforcement Officer or Washington Law Enforcement Officer may enforce the rules contained in this section pursuant to 46 U.S.C. 70118. In addition, the Captain of the Port may be assisted by other federal, state, or local agencies in enforcing this section.

Dated: May 25, 2016. D.J. Travers, Captain, U.S. Coast Guard, Captain of the Port, Sector Columbia River.
[FR Doc. 2016-13201 Filed 6-2-16; 8:45 am] BILLING CODE 9110-04-P
DEPARTMENT OF HOMELAND SECURITY Coast Guard 33 CFR Part 165 [Docket Number USCG-2016-0162] RIN 1625-AA00 Safety Zone; Richland Regatta, Columbia River, Richland, WA AGENCY:

Coast Guard, DHS.

ACTION:

Temporary final rule.

SUMMARY:

The Coast Guard is establishing a temporary safety zone for certain waters of the Columbia River in the vicinity of Howard Amon Park, Richland, WA, between River Miles 337 and 338, during hydroplane boat races from June 3, 2016, through June 5, 2016. This action is necessary to provide for the safety of life on the navigable waters of the Columbia River during the event. This regulation prohibits persons and vessels from being in the safety zone unless authorized by the Captain of the Port Sector Columbia River or a designated representative.

DATES:

This rule is effective from June 3, 2016, through June 5, 2016. The rule will be enforced from 7 a.m. to 7 p.m. each day it is effective.

ADDRESSES:

To view documents mentioned in this preamble as being available in the docket, go to http://www.regulations.gov, type USCG-2016-0162 in the “SEARCH” box and click “SEARCH.” Click on Open Docket Folder on the line associated with this rule.

FOR FURTHER INFORMATION CONTACT:

If you have questions about this rule, call or email Mr. Ken Lawrenson, Waterways Management Division, MSU Portland, OR, U.S. Coast Guard; telephone 503-240-9319, email [email protected]

SUPPLEMENTARY INFORMATION: I. Table of Abbreviations CFR Code of Federal Regulations DHS Department of Homeland Security FR Federal Register NPRM Notice of proposed rulemaking § Section U.S.C. United States Code II. Background Information and Regulatory History

On December 21, 2015, the Northwest Power Boat Association notified the Coast Guard that it will be conducting hydroplane boat races from 7 a.m. to 7 p.m. daily from June 3, 2016 through June 5, 2016, as part of the Richland Regatta. The races will be held in the vicinity of Howard Amon Park, Richland, WA. In response, on March 21, 2016, the Coast Guard published a notice of proposed rulemaking (NPRM) titled Safety Zone; Richland Regatta, Columbia River, Richland, WA (81 FR 14998). There we stated why we issued the NPRM, and invited comments on our proposed regulatory action related to this marine event. During the comment period that ended April 20, 2016, we received no comments.

We are issuing this rule, and under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause exists for making it effective less than 30 days after publication in the Federal Register. Due to delays in processing this regulation, it would be impracticable to delay the effective date until 30 days after publication, as this delay would eliminate the safety zone's effectiveness and usefulness in preventing the potential dangers to the public caused by the racing of vessels at high speeds.

III. Legal Authority and Need for Rule

The Coast Guard is issuing this rule under the authority in 33 U.S.C. 1231. The Captain of the Port Columbia River (COTP) has determined that potential hazards associated with the hydroplane races on June 3, 2016, through June 5, 2016, will be a safety concern for all waterway users on the Columbia River between River Miles 337 and 338 during the event. The hydroplane races pose significant dangers to the maritime public including excessive noise, vessels racing at high speeds in proximity to other vessels, and flying debris in the event of an accident. The purpose of this rule is to ensure the safety of vessels and the navigable waters before, during and after the scheduled event.

IV. Discussion of Comments, Changes, and the Rule

As noted above, we received no comments on our NPRM published March 21, 2016. There are no changes in the regulatory text of this rule from the proposed rule in the NPRM.

This rule establishes a safety zone from 7 a.m. to 7 p.m. on June 3, 2016, through June 5, 2016. The safety zone will include all navigable waters of the Columbia River in the vicinity of Howard Amon Park, Richland, WA between River Miles 337 and 338. The duration of the zone is intended to ensure the safety of vessels and these navigable waters during the scheduled hydroplane races. No vessel or person will be permitted to enter, transit through, anchor in, or remain within the regulated area unless authorized by Captain of the Port Sector Columbia River or a designated representative.

V. Regulatory Analyses

We developed this rule after considering numerous statutes and Executive orders related to rulemaking. Below we summarize on analyses based on a number of these statutes and Executive orders, and we discuss First Amendment rights of protestors.

A. Regulatory Planning and Review

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

This regulatory action determination is based on the following factors. The safety zone will only be effective for twelve hours daily over a three day period, and while non-participant vessels will be unable to enter, transit through, anchor in, or remain within the event area without authorization from the Captain of the Port Sector Columbia River or a designated representative, they may operate in the surrounding areas during the enforcement period. Additionally, non-participant vessels may still enter, transit through, anchor in, or remain within the event area during the enforcement period if authorized by the COTP Sector Columbia River or a designated representative. The Coast Guard would issue a Broadcast Notice to Mariners via VHF-FM marine channel 16 about the zone.

B. Impact on Small Entities

The Regulatory Flexibility Act of 1980, 5 U.S.C. 601-612, as amended, requires Federal agencies to consider the potential impact of regulations on small entities during rulemaking. The term “small entities” comprises small businesses, not-for-profit organizations that are independently owned and operated and are not dominant in their fields, and governmental jurisdictions with populations of less than 50,000. The Coast Guard received no comments from the Small Business Administration on this rulemaking. The Coast Guard certifies under 5 U.S.C. 605(b) that this rule would not have a significant economic impact on a substantial number of small entities.

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

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

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

C. Collection of Information

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

D. Federalism and Indian Tribal Governments

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

Also, 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. If you believe this rule has implications for federalism or Indian tribes, please contact the person listed in the FOR FURTHER INFORMATION CONTACT section.

E. Unfunded Mandates Reform Act

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.

F. Environment

We have analyzed this rule under Department of Homeland Security Management Directive 023-01 and Commandant Instruction M16475.lD, which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (42 U.S.C. 4321-4370f), and determined that this action is one of a category of actions that do not individually or cumulatively have a significant effect on the human environment. This rule involves a safety zone from 7 a.m. to 7 p.m. daily from June 3, 2016 through June 5, 2016. The safety zone would cover all navigable waters of the Columbia River in the vicinity of Howard Amon Park, Richland, WA. It is categorically excluded from further review under paragraph 34(g) of Figure 2-1 of Commandant Instruction M16475.lD. 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.

G. Protest Activities

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.

List of Subjects in 33 CFR Part 165

Harbors, Marine safety, Navigation (water), Reporting and recordkeeping requirements, Security measures, Waterways.

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

PART 165—REGULATED NAVIGATION AREAS AND LIMITED ACCESS AREAS 1. The authority citation for part 165 continues to read as follows: Authority:

33 U.S.C. 1231; 50 U.S.C. 191; 33 CFR 1.05-1, 6.04-1, 6.04-6, and 160.5; Department of Homeland Security Delegation No. 0170.1.

2. Add § 165.T13-0162 to read as follows:
§ 165.T13-0162 Safety Zone; Richland Regatta, Columbia River, Richland, WA.

(a) Regulated area. The following regulated area is a safety zone. The safety zone will include all navigable waters of the Columbia River in the vicinity of Howard Amon Park, Richland, WA, between River Miles 337 and 338.

(b) Definitions. (1) The term “designated representative” means Coast Guard Patrol Commanders, including Coast Guard coxswains, petty officers, and other officers operating Coast Guard vessels, and Federal, state, and local officers designated by or assisting the Captain of the Port Sector Columbia River in the enforcement of the regulated area.

(2) The term “Non-participant persons and vessels” means a vessel or person not participating in the event as a participant, spectator, or event attendee.

(c) Regulations. (1) In accordance with the general regulations in subpart C of this part, non-participant persons and vessels are prohibited from entering, transiting through, anchoring in, or remaining within the regulated area unless authorized by Captain of the Port Sector Columbia River or a designated representative.

(2) Non-participant persons and vessels may request authorization to enter, transit through, anchor in, or remain within the regulated area by contacting the Captain of the Port Sector Columbia River or a designated representative via VHF radio on channel 16. If authorization is granted by the Captain of the Port Sector Columbia River or a designated representative, all persons and vessels receiving such authorization must comply with the instructions of the Captain of the Port Sector Columbia River or a designated representative.

(d) Enforcement period. This safety zone as described in paragraph (a) of this section will be enforced from 7 a.m. to 7 p.m. each day on June 3, 2016, through June 5, 2016.

Dated: May 27, 2016. D.J. Travers, Captain, U.S. Coast Guard, Captain of the Port, Sector Columbia River.
[FR Doc. 2016-13108 Filed 6-2-16; 8:45 am] BILLING CODE 9110-04-P
ENVIRONMENTAL PROTECTION AGENCY 40 CFR Parts 51, 52, 70, and 71 [EPA-HQ-OAR-2013-0685; FRL-9946-55-OAR] RIN 2060-AS06 Source Determination for Certain Emission Units in the Oil and Natural Gas Sector AGENCY:

Environmental Protection Agency (EPA).

ACTION:

Final rule.

SUMMARY:

The U.S. Environmental Protection Agency (EPA) is finalizing a revision to regulations applicable to permitting of stationary sources of air pollution under the New Source Review (NSR) and title V programs in the Clean Air Act (CAA or Act). For sources in the oil and natural gas sector, this rule clarifies the meaning of the term “adjacent” that is used to determine the scope of a “stationary source” for purposes of the Prevention of Significant Deterioration (PSD) and Nonattainment NSR (NNSR) preconstruction permitting programs and the scope of a “major source” in the title V operating permit program in the onshore oil and natural gas sector. The revised definitions are based on the proximity of emitting activities and consideration of whether the activities share equipment. We believe that this clarification will provide greater certainty for the regulated community and for permitting authorities, and will result in more consistent determinations of the scope of a source in this sector. The EPA is adopting this revised definition in the regulations that apply to permits issued by the EPA and states to which the EPA has delegated federal authority to administer these programs. Other state and local permitting authorities with EPA-approved programs may also revise their permit programs to adopt this definition, but are not required to do so.

DATES:

This final rule is effective on August 2, 2016.

ADDRESSES:

The EPA has established a docket for this action under Docket ID No. EPA-2060-2013-0685. All documents in the docket are listed on the http://www.regulations.gov Web site. Although listed in the index, some information is not publicly available, e.g., Confidential Business Information or other information whose disclosure is restricted by statute. Certain other material, such as copyrighted material, is not placed on the Internet and will be publicly available only in hard copy form. Publicly available docket materials are available electronically through http://www.regulations.gov.

FOR FURTHER INFORMATION CONTACT:

For further general information on this rulemaking, contact Ms. Cheryl Vetter, Office of Air Quality Planning and Standards (C504-03), U.S. Environmental Protection Agency, by phone at (919) 541-4391, or by email at [email protected]; or Mr. Greg Nizich, Office of Air Quality Planning and Standards (C504-03), U.S. Environmental Protection Agency, by phone at (919) 54l-3078, or by email at [email protected]

SUPPLEMENTARY INFORMATION:

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

Entities potentially affected directly by this final action include owners or operators of sources of new and modified operations within the oil and natural gas production and processing segments of the oil and gas sector (herein after referred to as “oil and natural gas operations”). Such entities are expected to be in the groups indicated in the following table. In addition, state, local and tribal governments may be affected by the rule if they update state rules to adopt the changes being made to federal permit program rules.

Industry group NAICS code 1 Oil and Gas Extraction 21111. Crude Petroleum and Natural Gas Extraction 211111. Natural Gas Liquid Extraction 211112. Drilling Oil and Gas Wells 213111. Support Activities for Oil and Gas 213112. Federal Government May Be Affected. State/Local/Tribal Government May Be Affected. B. Where can I get a copy of this document and other related information?

In addition to being available in the docket, an electronic copy of this document will be posted at: http://www3.epa.gov/airquality/oilandgas/actions.html. Upon its publication in the Federal Register, only the published version may be considered the final official version of the notice, and will govern in the case of any discrepancies between the Federal Register published version and any other version.

1 North American Industry Classification System (NAICS). The table refers to the more commonly used NAICS code. However, the four-digit SIC codes was the only code system in use at the time our rules were developed. This classification system has since been replaced by the six-digit NAICS, which was developed with Canada and Mexico, and is used for classifying North American businesses. While the SIC codes are no longer updated, the United States Department of Labor's Occupational Safety and Health Administration still mains the list of SIC codes for references. We have retained the SIC codes in the regulation.

C. How is this document organized?

The information presented in this document is organized as follows:

I. General Information A. Does this action apply to me? B. Where can I get a copy of this document and other related information? C. How is this document organized? II. Background for Final Rulemaking III. Summary of the Final Rule Requirements IV. Responses to Significant Comments on the Proposed Rule A. General Comments B. Comments on Option 1 C. Comments on Option 2 D. Implementation Issues V. Environmental Justice Considerations VI. Statutory and Executive Order Reviews A. Executive Order 12866: Regulatory Planning and Review and Executive Order 13563: Improving Regulation and Regulatory Review B. Paperwork Reduction Act (PRA) C. Regulatory Flexibility Act (RFA) D. Unfunded Mandates Reform Act (UMRA) E. Executive Order 13132: Federalism F. Executive Order 13175: Consultation and Coordination With Indian Tribal Governments G. Executive Order 13045: Protection of Children From Environmental Health and Safety Risks H. Executive Order 13211: Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use I. National Technology Transfer and Advancement Act J. Executive Order 12898: Federal Actions To Address Environmental Justice in Minority Populations and Low-Income Populations K. Congressional Review Act (CRA) L. Judicial Review Statutory Authority II. Background for Final Rulemaking

This action affects the determination of what constitutes a “stationary source” for the PSD and NNSR preconstruction permit programs under title I of the CAA, and the determination what constitutes a “major source” for the title V operating permit program. Under the PSD and NNSR programs, a “stationary source” is defined as a “building, structure, facility, or installation” that emits or may emit a “regulated NSR pollutant.” 2 40 CFR 51.165(a)(1)(i), 51.166(b)(5). In turn, a “building, structure, facility, or installation” is defined as “all of the pollutant-emitting activities” that satisfy three prongs: they “belong to the same industrial grouping”; “are located on one or more contiguous or adjacent properties”; and “are under the control of the same person (or persons under common control).” 40 CFR 51.165(a)(1)(ii); 51.166(b)(6). Under the title V program, “stationary source” is defined similarly, but with reference to a different set of pollutants; however, the term “building, structure, facility, or installation” is not defined. Instead, the same three-prong test is incorporated into the definition of “major source.” 40 CFR 70.2; 71.2. We 3 use the term “source determination” to describe a case-specific examination of particular pollutant-emitting activities to see whether, under the definitions just discussed, they are collectively a “stationary source” for purposes of the PSD or NNSR programs or are potentially (depending on their level of emissions) a “major source” for the purposes of the title V program.

2 The term “regulated NSR pollutant” is defined differently for the two programs, consistent with their separate purposes. 40 CFR 51.165(a)(1); 51.166(b)(49).

3 In this preamble, the term “we” and “our” refers to the EPA.

On September 18, 2015, the EPA proposed two options for clarifying the meaning of the term “adjacent” in the second prong discussed in the previous paragraph as applied to oil and gas sources, under both the preconstruction and operating permits programs. Source Determination for Certain Emission Units in the Oil and Natural Gas Sector. See 80 FR 56579, September 18. 2015. The preamble to the proposal provided a discussion of the history of making source determinations generally, and for these segments specifically, the previous guidance we have issued and the litigation that resulted. We explained our rationale for the two options we proposed for clarifying the term “adjacent” as it is used in determining the scope of a source for purposes of air permitting for these segments. The EPA's preferred option, referred to as Option 1, would have required permitting authorities to aggregate, for permitting purposes, all onshore oil and natural gas emitting equipment 4 that are within the two-digit Standard Industrial Classification (SIC) code 13 5 (hereafter referred to as “oil and natural gas operations”), are under common control of a single person (or persons under common control), and that are located within 1/4 mile of each other. We believed that establishing a “bright line” based on the proximity of the equipment (in this case, 1/4 mile), as several oil and gas-producing states seemed to have done, would simplify permitting because it would avoid a more detailed case-by-case evaluation based on the relationship of the emitting equipment. We also proposed a second option, Option 2, which would have aggregated all emitting equipment within 1/4 mile but would also have allowed permitting authorities to aggregate emitting equipment located beyond 1/4 mile based on the relationship between the operations. The EPA described this relationship as “exclusive functional interrelatedness,” but requested comment on more specific ways to describe a relationship that meets the common sense notion of a plant. Finally, we requested comment on whether some combination of these two options might be preferable. This final rulemaking notice does not repeat all of the discussion, but refers interested readers to the preamble of the proposed rule for additional background.

4 Within this document the terms “emitting equipment” and “emitting activities” are used interchangeably.

5 The description for Major Group 13: Oil and Gas Extraction can be found at https://www.osha.gov/pls/imis/sic_manual.display?id=8&tab=group. This major group includes establishments primarily engaged in: (1) Producing crude petroleum and natural gas; (21 extracting oil from oil sands and oil shale; (3) producing natural gasoline and cycle condensate; and (4) producing gas and hydrocarbon liquids from coal at the mine site. Types of activities included are exploration, drilling, oil and gas well operation and maintenance, the operation of natural gasoline and cycle plants, and the gasification, liquefaction, and pyrolysis of coal at the mine site. This major group also includes such basic activities as emulsion breaking and desilting of crude petroleum in the preparation of oil and gas customarily done at the field site. Pipeline transportation of petroleum, gasoline, and other petroleum products (except crude petroleum field gathering lines) is classified in Transportation and Public Utilities, Major Group 46, and of natural gas in Major Group 49.

III. Summary of the Final Rule Requirements

This section provides a brief summary of the requirements of the final rule. Further discussion of the basis for these requirements and summaries of our responses to significant comments are provided in the next section.

Based on the range and substance of the comments received, the EPA has made two revisions to the proposed definition of “adjacent” that are reflected in the final rule. As discussed in the proposal, we proposed that pollutant-emitting activities from onshore oil and natural gas operations that are located on the same “surface site,” as defined in 40 CFR 63.761,6 or on surface sites located within 1/4 mile of each other, would be considered “adjacent” for purposes of determining the source. We selected 1/4 mile as a “bright line” distance for clarifying the meaning of “adjacent” based on proximity to be consistent with those states that also use a “bright line” approach as a way of delineating sources in this category. This also was, in our view, a reasonable distance within which sources in oil and natural gas operations are likely to be interconnected. However, we received comments from several entities that said that we misunderstood the states' approach. According to them, several states that use the 1/4 mile boundary do not aggregate everything within it, as we proposed. Rather they use the 1/4 mile boundary to define an area beyond which they would not consider pollutant emitting equipment to be adjacent and part of a single source. Within 1/4 mile, these states determine on a case-by-case basis which equipment should be considered a single source because it meets the “common sense notion of a plant.”

6 40 CFR 63.761 defines surface sites as any combination of one or more graded pad sites, gravel pad sites, foundations, platforms, or the immediate physical location upon which equipment is physically affixed.

For the reasons discussed more fully later in this notice, we have decided to modify the proposed definition in response to the recommendations made by commenters. As we proposed under both Option 1 and Option 2, emitting equipment in the oil and natural gas production and processing segments located at a single onshore surface site will be considered “adjacent” under the final rule and, thus, part of a single stationary source, assuming the equipment is also under the control of one person (or persons under common control) and belongs to the two-digit SIC code 13. Also, as we proposed in Option 1, we are finalizing a definition that equipment on separate surface sites located more than 1/4 mile apart is not “adjacent” and, therefore, is not part of the same stationary source. However, in this final rule, we are modifying Option 1 by incorporating an element from Option 2 and the state policies on which we modeled Option 1. Specifically, we would not require that all emitting equipment located on separate surface sites within 1/4 mile of each other be considered “adjacent.” Instead, emitting equipment located on separate surface sites within 1/4 mile of each other would only be aggregated as a single stationary source if the emitting equipment also have a relationship that meets the “common sense notion of a plant.”

This expression, the “common sense notion of a plant,” has been a criterion by which we have made source determinations for sources in all industries since our PSD rules were revised in 1980 (45 FR 52676, August 7, 1980) in response to the D.C. Circuit Court of Appeals Alabama Power decision. Alabama Power Co. v. Costle, 636 F. 2d 323, 397 (D.C. Cir. 1979). In the onshore oil and natural gas production and processing segments, the “plant” is not as easy to discern as it is for other industrial operations, such as an electric utility generating plant or an oil refinery. Unlike these industrial operations, onshore oil and natural gas operations may not have an obvious boundary and may be located on property owned and controlled by others.

As explained in our proposal, one way in which we historically have evaluated whether activities meet the common sense notion of a plant was through the use of “functional interrelatedness” or “operational dependence.” See 80 FR 56581, September 18. 2015. Our proposed Option 2 would have looked for “exclusive functional interrelatedness” of emitting equipment outside the 1/4 mile radius. See 80 FR 56587, September 18. 2015. We asked for comment on whether we should further define “exclusive functional interrelatedness” to give additional clarity to regulators and the regulated community.

Rather than looking for “functional interrelatedness” in oil and natural gas operations and giving this term more specific definition, we have decided in this final rule that it is preferable to look for “shared equipment” to determine when emitting activities in oil and natural gas operations have a relationship that meets the “common sense notion of a plant.” The EPA has applied the generalized notion of “functional interrelatedness” in other ways in other source categories, in some cases, at the request of the source. However, for oil and natural gas operations, we find it preferable to use a term that will give a more precise and clear criterion for defining when emitting activities within a 1/4 mile proximity are sufficiently related to be considered adjacent, in line with the objectives of the proposal.

For onshore oil and natural gas production, this final rule establishes that, where separate surface sites located within 1/4 mile of each other include shared equipment necessary to process or store oil or natural gas, these surface sites will be aggregated. The EPA has concluded that equipment satisfying these criteria will meet the common sense notion of a plant. Under this final rule, separate surface sites that do not include shared emitting equipment, even if within 1/4 mile, will not be aggregated.

For example, an owner or operator proposing to construct a new well site should draw a 1/4 mile circle from the center of the proposed new well site. If there is commonly-controlled emitting equipment located within that 1/4 mile circle and within major SIC code 13, and that equipment is used to process or store the oil, natural gas or the byproducts of production that will come from the new well site, then the emissions from that equipment should be included in determining whether the new well site is a major source. Examples of shared equipment include, but are not limited to, produced fluids storage tanks, phase separators, natural gas dehydrators or emissions control devices. In this example, the shared equipment is necessary for the operation of the new well site, and should be considered part of the same source because together all of the equipment operates as a “plant.” However, under the terms of this rule, we would not consider two well sites that feed to a common pipeline to be part of the same stationary source if they do not share any processing or storage equipment between them.

We believe this change from the proposed rule is responsive to both the comments that we received from several states about the burden of aggregating individual surface sites, and from the industry about the independent nature of many, if not most, surface sites.

We proposed to clarify the meaning of “adjacent” in all of the permitting rules, both the rules that apply to the EPA and delegated states as the permitting authority, as well as the rules that apply to state, local or tribal permitting authorities. However, we requested comment on whether we should require state, local and tribal permitting authorities to make this proposed change to their regulations. Several states, including both those with oil and natural gas operations and those without, expressed a desire to retain their existing approach to source determinations in permitting. These states, particularly those with oil and natural gas operations, expressed concern about the increased burden of the EPA's proposed Option 1. After reviewing the comments, the EPA has decided to adopt this change in its permitting rules, but to not require state, local and tribal permitting authorities to adopt this change. However, if they choose to do so, state, local and tribal permitting authorities may adopt the EPA's revised definition and submit their revised program to the EPA for approval.

IV. Responses to Significant Comments on the Proposed Rule

The EPA received more than 19,000 comments on the proposed rule. In this section we summarize the major comments and our responses. For details of all the significant comments and our responses, please refer to the Response to Comments document in the docket for this rulemaking.

A. General Comments 1. Need for Clear Guidance a. Summary of Proposal

In the proposed rule, the EPA described the history and the current status of making source determinations for onshore oil and natural gas operations. We described the guidance that had been issued, the source determinations that have been made and the lack of clarity that has often resulted. We proposed two options for clarifying the term “adjacent” when making source determinations for onshore oil and natural gas operations.

b. Brief Summary of Comments

Several commenters stated that providing clear and reasonable definitions in rulemaking would benefit the regulated community, regulators and other stakeholders by providing needed certainty. The current lack of clarity, according to commenters, has resulted in increased costs due to permitting delays and litigation following the issuance of a permit. Several commenters also supported our decision to provide this clarification through rulemaking, rather than by additional guidance.

Other commenters did not believe that a rulemaking is necessary. These commenters stated that the rulemaking is not necessary because the term “adjacent” is unambiguous, that it is synonymous with “contiguous,” i.e., that “adjacent' means touching, sharing a border, or abutting. These commenters pointed to the dictionary definition of the word “adjacent” as being “contiguous.” Some of these commenters went on to say that the meaning of the term “adjacent” has been clearly established in relevant case law, citing Summit Petroleum Corp. v. EPA, 690 F.3d 733, 742 (6th Cir. 2012). And some commenters questioned our authority to adopt the two meanings of the term that we proposed, claiming that the proposed definitions violated the D.C. Circuit Court of Appeals' holdings in Alabama Power or that the EPA simply lacked authority to define the term “adjacent” in a way that, according to commenters, conflicted with the dictionary definition and/or the decision of the Sixth Circuit Court of Appeals in Summit Petroleum.

c. EPA Response

We agree with the commenters who stated that a rulemaking is the best way to provide clarity in permitting. However, we recognize that most permits are issued by states, and that some states have substantial experience in making source determinations for oil and natural gas operations. Accordingly, in recognition of this state expertise, and in response to many comments, we are making the meaning of “adjacent” adopted in this rule mandatory only for the permit programs administered by the EPA or delegated states, while leaving to other states the decision of whether to make a similar change to their approved permitting.

We disagree with commenters who claim that the EPA lacks authority to define adjacent by regulation or that state the rulemaking is unnecessary because of the dictionary meaning of “adjacent” and the Summit Petroleum decision. These commenters are mistaken that the EPA cannot define “adjacent” by rule to mean all emitting equipment within a specified radius.7 Commenters gave two reasons for this: first, that to do so would not comport with Alabama Power, and second, that the EPA's authority to give a meaning to “adjacent” that varies from its dictionary definition is foreclosed by the Summit Petroleum decision.

7 Although we are not finalizing an option (such as our proposed Option 2) that would potentially include emitting activities outside a 1/4 mile radius, commenters are also mistaken (for similar reasons) in asserting that we could not have finalized such an option.

Regarding the first point, the CAA affords the EPA discretion in the permitting context to provide a more specific meaning to the term “stationary source” that is used in the Act. See, Chevron USA, Inc. v. NRDC, 467 U.S. 837 (1984) (discussing the meaning of the term stationary source under the CAA). Through a rulemaking process, we are defining the statutory term “stationary source” for a particular context: the PSD, NNSR and title V programs as applied to oil and natural gas operations. The definition of the term “stationary source” in section 302(z) of the Act, the related definition in section 111(a)(3), the structure of the Act, and its legislative history do not supply a clear meaning of “stationary source” in this context. Thus, it is permissible for the agency, in a rulemaking process, to apply a reasonable interpretation of the statute that resolves an ambiguity.8 It is also permissible for the EPA to create a rule using a “bright line,” as we are doing here, for purposes of better administering the Act, see Emily's List v. Fed. Election Comm'n, 581 F.3d 1, 22 n.20 (D.C. Cir. 2002).

8 In fact, the Supreme Court in Chevron reversed the D.C. Circuit Court of Appeals' judgment that the EPA had impermissibly interpreted “stationary source,” stating that the Circuit Court erred by “read[ing] the statute inflexibly” and not deferring to the EPA's reasonable interpretation.

As to the second point, while the Summit Petroleum decision is a motivating factor for this action, the decision, and the Court's reference to the dictionary meaning of “adjacent” in that decision, are not preclusive of our authority to take the action. The Summit Petroleum Court addressed the issue of whether, in the absence of a rule defining the term “adjacent,” the EPA had permissibly interpreted the term in a particular source determination. The Court looked to the dictionary definition of “adjacent” to determine whether the EPA's interpretation of this term would “permit the agency, under the guise of interpreting a regulation, to create de facto a new regulation.” Summit Petroleum, 690 F.3d at 740 (quoting Christensen v. Harris Cnty., 529 U.S. 576, 588 (2000)). In this rulemaking action, the EPA is not interpreting the term “adjacent” in the existing regulation; instead we are assigning a meaning to the term by going through a rulemaking process. When an agency is defining a word by rule, the agency is free to give specialized meaning to the word without being bound to hew precisely to a particular dictionary definition. See Stenberg v. Carhart, 530 U.S. 914, 942 (2000) (noting that an “explicit definition” can permissibly “vary from the term's ordinary meaning”). And in fact, the PSD regulations in 40 CFR 51.166 are replete with such specialized meanings, for example in the definitions of “significant” and “process unit.” 9

9 For similar reasons, comments that cite case law about agency interpretations of statutes and that refer to the dictionary definition of “adjacent” are off target: the statutory term we are interpreting is “stationary source” (and the related definition in section 111(a)(3)), not “adjacent.” We are defining the term “adjacent” in order to give meaning to our reasonable interpretation of the statutory term “stationary source.”

Even if commenters were correct—and they are not—that the EPA is bound by a particular dictionary definition of “adjacent” when defining the term for specialized use, commenters are mistaken about the meaning of the term. While many dictionary definitions of “adjacent” include “contiguous” as one definition, this is not the only definition of the word “adjacent.” For example, one online dictionary defines “adjacent” to mean “lying near, close, or contiguous; adjoining; neighboring.” 10 Another dictionary provides the following “Synonym Discussion of Adjacent”: “Adjacent may or may not imply contact but always implies absence of anything of the same kind in between . . .” 11 This dictionary makes a further distinction in its “Synonym Discussion”, stating that the word “adjoining” definitely implies meeting and touching at some point or line.” 12 So, while we agree that “adjacent” can mean contiguous, we do not agree that it unambiguously must. We are finalizing this rule to provide a bright line distance beyond which pollutant-emitting operations in the onshore oil and natural gas production and processing segments are not considered “adjacent.” The decision to use both words “contiguous” and “adjacent” in our PSD rules was a deliberate choice, designed to include emitting equipment that is on property that is touching (contiguous) with equipment that may not be contiguous, but still meets the common sense notion of a plant. Had we intended “adjacent” to mean exactly the same as “contiguous,” we would not have included the word “adjacent.”

10 Dictionary.com http://dictionary.reference.com/browse/adjacent?s=t accessed February 22, 2016.

11 Thus, two surface sites separated by 1/4 mile may be “adjacent,” if there is no surface site in between them.

12 Merriam-Webster Dictionary, http://www.merriam-webster.com/dictionary/adjacent accessed February 22, 2016.

Finally, we disagree with commenters who argue the Summit Petroleum Court provided sufficient guidance on the meaning of “adjacent” to obviate the need for this rulemaking. The Court's decision is binding only in the Sixth Circuit, which leaves the issue unresolved elsewhere.13 The Court also did not provide guidance on how “nearby” sources must be to consider them “adjacent” for purposes of permitting. This is the question that we have taken up in this rulemaking, specific to onshore oil and natural gas operations. We have clarified that “adjacent” for these segments means within 1/4 mile and having shared equipment.

13 While the D.C. Circuit Court of Appeals has held that the EPA is bound by our regional consistency regulations, the Court also suggested that we could revise them in order “to account for regional variances created by a judicial decision or circuit splits.” Nat'l Envt'l Dev. Ass'n's Clean Air Proj. v. EPA, 752 F.3d 999, 1010 (D.C. Cir. 2014). We have proposed to do so. 80 FR 63935 (October 22, 2015).

B. Comments on Option 1 1. Support for Option 1 a. Summary of Proposal

In Option 1, the EPA proposed that the meaning of “adjacent,” for purposes of determining the scope of a source in the oil and natural gas production and processing segments, should be based solely on the distance between pollutant emitting activities. Under this option, emitting equipment at a single surface site would be considered to be adjacent, and emitting equipment at two or more surface sites would be considered “adjacent” if they are located within 1/4 mile of each other. We stated in the proposal that we believed this option to be the most consistent with the “common sense notion of a plant.” We chose the distance, 1/4 mile, because it is the distance we found in permitting guidance issued by a number of oil and natural gas producing states. The EPA also considered this distance reasonable to use for the types of equipment used in this industry.

b. Brief Summary of Comments

Several commenters supported Option 1 as written. These commenters preferred Option 1 over Option 2 because they believed it is the least ambiguous and reflects the plain meaning of the word “adjacent.” One commenter stated that this approach would streamline the determination of the scope of a “stationary source” and would reduce the time it takes to get a permit.

Other commenters, while supporting Option 1 over Option 2, recommended revisions to Option 1. Many of these commenters offered different distances within which emitting equipment or operations should be considered one source. The suggested distances ranged from a requirement that operations be physically touching or abutting to be considered “adjacent” to distances of up to one mile.

Finally, many state and industry commenters recommended a particular revision to Option 1. These commenters recommended that the EPA consider emitting activities located on separate surface sites within 1/4 mile to be adjacent only if they also meet the “common sense notion of a plant” that the EPA has used since 1980 when determining the scope of a source for permitting purposes. Two state commenters told us that while their state has guidance that includes 1/4 mile as the distance for determining the source, they do not use the distance as a bright line. Rather, they use it as an outer boundary, within which they assess whether emitting equipment should be considered a single source for purposes of permitting, but beyond which they do not consider emitting equipment to be adjacent.

c. EPA Response

We are adopting the approach recommended by several commenters: to require that pollutant-emitting equipment on separate surface sites be considered one source only if the sites are within 1/4 mile of each other and the equipment is considered by the permitting authority to meet the common sense notion of a plant. More specifically, the language in the final rule treats certain oil and gas-related pollutant-emitting activities as a plant based on “shared equipment.” Operations located on the same surface site would continue to be considered part of the same source provided that they are also within the same two-digit SIC code and are under common control of the same person (or persons under common control). While we do not agree with comments that argue that a particular dictionary definition of “adjacent” and/or the Summit Petroleum and Alabama Power decisions compel this outcome, we agree with the comments that this approach better achieves the purpose of the rule: to reduce permitting burdens, as explained later in this notice.

2. Do Not Support Option 1 a. Brief Summary of Comments

Some commenters did not support Option 1. One concern raised was that, while the Option 1 approach would streamline permitting, it would not provide sufficient flexibility to consider and address local air quality concerns. Other commenters were concerned that the Option 1 approach would result in the aggregation of sources that should not be treated as one source. Another commenter was concerned that the Option 1 approach would allow the oil and gas industry to avoid major source regulation under the CAA. This commenter went on to say that Option 1 would not approximate a “common sense notion of a plant” or fit within the ordinary meaning of facility or installation as used in the definition of source.

b. EPA Response

In response to concerns raised by commenters about the need for permitting authorities to be able to address local air quality concerns, we are not requiring that EPA-approved state and local programs adopt the approach that the EPA is finalizing for permits issued by the EPA and delegated states. This will allow state and local permitting authorities with EPA-approved programs to continue to use their discretion to make source determinations for this industry in the manner that they believe best addresses their local air quality concerns. For example, those local programs in California that have a long history of permitting oil and natural gas operations on contiguous leases as single sources under their approved programs will be able to continue to do so, without having to submit an equivalency demonstration showing that their programs are at least as stringent as the program adopted by the EPA. Because the EPA is not requiring states with approved programs to apply our meaning of the term “adjacent,” and our rule changes make clear that for approved programs this change is optional, these approved programs already comply with our PSD, NNSR and title V rules, without these changes. States also remain free to adopt more stringent requirements in order to address local air quality concerns.

Those states that administer PSD permitting programs under a delegation of federal authority by the EPA will have to follow the approach that we are finalizing, or develop their own permitting programs and have them approved by the EPA as a revision to a state implementation plan (SIP). We did not receive adverse comments regarding delegated PSD programs having to use this approach. Those state and local programs that are approved, not delegated, that incorporate the EPA's program by reference, may incorporate the definition of “adjacent” for onshore oil and natural gas operations in 40 CFR 52.21(b)(6)(ii), and/or 40 CFR appendix S to part 51; or they may specifically exclude this paragraph from their incorporation when they next update it.

There may be state and local governments with approved programs that wish to clarify the meaning of adjacent for oil and natural gas operations, as the EPA has done in its own permitting rules. Those state and local governments would be able to do so, but would not be required to do so on any particular schedule. We believe, after careful review of the comments received, that this approach offers the best resolution for the lack of clarity that has existed for this industry, particularly when we have been the permitting authority, but does not increase the burden on approved states by requiring them to revise their permitting programs (or to develop an equivalency demonstration) and submit the changes to us as SIP revisions.

3. Response to the EPA's Question on the Appropriate Distance a. Summary of Proposal

We requested comments on whether some distance other than the proposed 1/4 mile would be a more appropriate distance within which emitting equipment should be considered “adjacent.” See 80 FR 56579, September 18, 2015.

b. Brief Summary of Comments

Commenters provided a range of responses to this question, ranging from 44 feet, which the commenter said was consistent with guidance from the Bureau of Land Management, to one mile, which the commenter suggested is consistent with the largest manufacturing plant that is considered one source. Other commenters recommended that a “city block” be used as the basis for determining the sources. However, these commenters did not agree on the dimensions of a city block. Other suggestions included distances based on the size of the lease, or some combination of leases, and a distance based on the well spacing in a particular field or state.

c. EPA Response

The EPA is retaining the proposed 1/4 mile distance in the final rule. This distance was originally selected to be consistent with those states that also use a specific distance. In addition, as commenters mention, it is a commonly-used distance in oil and gas development for well spacing. Well spacing is typically set by a state agency such as an oil and gas conservation commission, and is intended to develop the oil and gas resource fairly and efficiently. One-quarter of a mile corresponds to a 40-acre lease. We think that a variable distance, such as one based on an individual lease or combination of leases held by an entity would complicate permitting, contrary to the purpose of this rule. And, while a city block might have some meaning in an urban area, we were not persuaded that it has any more meaning than 1/4 mile in the areas where the majority of oil and natural gas development is taking place.

4. Response to the EPA's Question on “Daisy Chaining” a. Summary of Proposal

We requested comments on whether sources within 1/4 mile of each other should be “daisy chained.” We described a series of emissions units as being “daisy chained” when each individual emitting unit is located within 1/4 mile of the next unit, but where the last unit is separated from the first unit by a much larger distance. See 80 FR 56587, September 18, 2015.

b. Brief Summary of Comments

Most commenters expressed opposition to “daisy chaining.” Commenters were concerned that by “daisy chaining” emitting equipment, sources could extend for dozens of miles, or could even bring in equipment connected by a pipeline which would be inconsistent with the EPA's previous statements on source in the 1980 PSD rule preamble. In that rule, we stated that we did not intend “stationary source” to encompass activities that would be many miles apart along a long line operation (45 FR 52676, August 7, 1980).

c. EPA Response

After reviewing the comments we received, the EPA has determined that “daisy chaining” of emitting equipment would not provide the additional clarity that we seek through this rulemaking. We agree with commenters who said it could extend sources over many miles, perhaps even into the jurisdiction of multiple permitting authorities and in some instances beyond any common sense notion of a plant. This would increase the permitting burden for federal, state, local and tribal permitting authorities but we do not believe that it would provide additional air quality benefits beyond those that will occur as a result of the emission controls provided under the various New Source Performance Standards (NSPS), National Emission Standards for Hazardous Air Pollutants (NESHAP), and state and federal minor source programs, as explained later in this notice. We are, therefore, not adopting a requirement to include “daisy chained” equipment as part of a single source.

To illustrate how we intend this process to work in order to avoid “daisy chaining”, we provide the following example. On surface site “A”, there is an existing collection of equipment consisting of several tanks, a pump jack, a heater-treater and a flare. The owner/operator of site A decides to drill a new well within 1/4 mile of site A, called site “B.” Site B feeds its produced water to the tanks on site A. Site B must consider the emissions from site A in determining whether site B is a major source because sites A and B are part of the same stationary source. At a later date, the same owner/operator decides to drill a third well, “C,” within 1/4 mile of site B but more than 1/4 mile from site A. Sites C and B do not share any equipment. Therefore, site C is a single stationary source. Site C is not included with sites A and B (just because of proximity to B), and, therefore, there is no daisy chain created. If site C feeds material to the storage tanks at site A, then it would still not be considered part of the stationary source that includes site A, because it is located more than 1/4 mile away from site A.

Now, assume that the same owner/operator drills a fourth well, “D,” within 1/4 mile of site A, but more than 1/4 mile from sites B and C. Site D will also feed its produced water to site A. Site D must be treated as a modification to the source that is made up of sites A and B. In this case, site A may be viewed as a “hub” and sites B and D are the spokes. The new source consists of sites A, B and D because sites B and D are within 1/4 mile of the site at which the shared equipment exists. However, site C is not part of this source because site C is more than 1/4 from the surface site with which it shares equipment. New sites would not be included within the source that includes sites A, B and D if they were beyond 1/4 mile, so there would be no daisy chain.

We believe that the permitting authority can make these source determinations, on a case-by-case basis, based on the clarifications that the EPA has provided. We do not believe that it is possible to eliminate all case-by-case source determinations. However, we believe we have provided sufficient guidance to ensure that such determinations are made consistently, and with more certainty for both permitting authorities and sources.

5. Response to the EPA's Question on What To Use as the Starting Point for Measuring the Radius of the Source a. Summary of Proposal

We requested comment on whether to use the edge or some other feature of the oil or natural gas operation as the starting point of the 1/4 mile measurement radius when determining the source.

b. Brief Summary of Comments

Commenters generally supported defining the point from which the distance between pollutant-emitting equipment is measured. However, there was disagreement on whether the center of the emitting equipment or the property boundary should be used. Several state commenters recommended that the property boundary be the starting point for determining the distance between operations because this distance is most relevant for purposes of air quality. However several commenters in the oil and gas industry recommended that the geographic center of the site for purposes of establishing the 1/4 mile distance, because property boundaries may be difficult to determine. Unlike sites in other industries, oil and natural gas operations frequently do not have fences, so the property boundaries are not always easily distinguished. Emitting equipment, such as may be found at a well site, can be and often is easily identified by Global Positioning System coordinates.

c. EPA Response

The EPA has decided to establish the 1/4 mile boundary from the center of the equipment at the new or modified source for construction permits. At an oil or natural gas well, that may be the wellhead; on a surface site, it should be established from the center of the emitting activities. We believe the center of the emitting activities is the easiest to establish for purposes of permitting, and the easiest to observe for purposes of enforcement. This best achieves our goal of providing greater clarity for permitting authorities and permittees, improving permitting, compliance and enforcement. For title V permits, the center of the equipment on each surface site(s) being permitted should be used.

6. Permitting Burden Under Option 1 a. Summary of Proposal

We requested comment on whether the potentially smaller scope of each source could result in an unacceptable permitting burden by creating a larger number of smaller sources.

b. Brief Summary of Comments

Several state commenters expressed concern that Option 1, as proposed, would increase the administrative burden of issuing permits. This is primarily because they believe that the proposed requirement to aggregate emitting equipment within 1/4 mile would require them to reassess prior source determinations. This is particularly a concern when wells change ownership. The commenters stated that each transaction would require permitting authorities to reanalyze one or more previously-permitted sources to determine which equipment should be included in the source after the purchase or sale. Another commenter stated that while they expect an increase in minor source permitting under the EPA's proposed Option 1, they already have in place a number of streamlining options, such as general permits, which expedite regulatory timelines.

c. EPA Response

As discussed in Section IV.D.3 in this document, this rule will apply prospectively and will not require a reassessment of permits that have been completed. Furthermore, the EPA has revised the approach to source determination in the final rule to address concerns about burden raised by commenters. Instead of requiring that all activities within a 1/4 mile radius be aggregated, the EPA would instead only aggregate those activities within a 1/4 mile radius that share equipment. In many cases, this would result in the wells being permitted separately, reducing the administrative burden of transferring or modifying permits when wells change ownership. In addition, the EPA is not requiring that state, local, and tribal permitting authorities adopt the approach being finalized by us, so those permitting authorities that are concerned there would be an increased burden from our approach (which we do not expect) would not have to follow it.

We believe that the overall effect of this rule will be to reduce the permitting burden for permits issued by the EPA. The permitting burden for state, local and tribal permitting will differ depending on whether those permitting authorities choose to adopt these changes, and will depend on how any revised procedures differ from their current permitting practices. In some jurisdictions, the burden may be unchanged, either because the permitting authority chooses not to adopt the changes, or because the changes the EPA is finalizing do not substantially differ from the permitting authority's current practices.

7. Environmental Impact of Option 1 a. Summary of Proposal

We requested comment on whether there would be adverse air quality impacts, including effects on National Ambient Air Quality Standard (NAAQS) compliance, as a result of Option 1.

b. Brief Summary of Comments

One commenter expressed concern that the EPA's proposal would adversely affect the environment because it would encourage development of oil and gas resources over a larger area in order to avoid being within 1/4 mile. This would increase the footprint of operations, and have an adverse impact on landowners and communities. Other commenters stated that the aggregation of oil and gas operations would not result in environmental benefits because the emissions are already controlled by multiple NSPS and NESHAP standards as well as state minor source permitting programs. Finally, one commenter stated that oil and gas development is the largest industrial source of volatile organic compounds and a significant source of sulfur dioxide and nitrogen oxide pollution in many areas, and that failure to subject these sources to PSD and NNSR would frustrate attempts to ensure NAAQS compliance.

c. EPA Response

The EPA is finalizing several rules applicable to oil and natural gas operations, including an NSPS that will require pollution controls for oil well completions, equipment leaks and pneumatic controllers, among others, and a control techniques guideline (CTG) that will similarly define presumptive controls for the CAA's reasonably available control technology (RACT) requirements for certain areas. The additional emissions control requirements of the NSPS (and the CTG when adopted in RACT SIPs) make it less likely that these sources will be major sources, with or without the meaning of “adjacent” that we are adopting in this rule. This is because the threshold for permitting is based on the potential-to-emit of the source and the potential-to-emit may be reduced by enforceable limitations, such as those imposed by the NSPS. These restrictions, along with enforceable restrictions imposed by the states, reduce both the actual and potential emissions of the sources, reducing the likelihood that they will trigger major NSR or title V permitting. These control requirements will also ensure that new and modified operations emit substantially less air pollution which would contribute to local air quality. To the extent that NSPS requirements for these sources are insufficient to protect the NAAQS in attainment or unclassifiable areas—which we do not expect—the federal or state minor NSR program is intended to address that issue. For nonattainment areas, if the CTG presumptive controls are not sufficient to attain the NAAQS, then other emission reductions will be required in order to attain the standards.

We do not believe that this final rule is likely to result in decisions by companies to locate farther apart to avoid major source permitting. We believe that the location of the underground mineral assets, advances in drilling technology that allow multiple wells to be drilled from one surface site, restrictions on well spacing imposed by a state agency such as an oil and gas conservation commission, and the restrictions imposed by the owner of the surface land are more likely to affect siting decisions than a desire to avoid major source permitting. As discussed earlier in this document, we believe the combined effect of the emission control standards already in place and the additional controls now being finalized is that fewer oil and natural gas operations will be major.

C. Comments on Option 2 1. Support for Option 2 a. Summary of Proposal

In Option 2, the EPA proposed that all equipment within 1/4 mile would be considered a single source and would allow equipment beyond 1/4 mile to be included in the source if it was “exclusively functionally interrelated.” See 80 FR 56579, September 18, 2015.

b. Brief Summary of Comments

Several commenters representing permitting authorities supported Option 2 because they believed that it is the option most similar to the way they make source determinations for this industry and others under their existing, SIP-approved programs.

c. EPA Response

The EPA is not adopting the “functional interrelatedness” criterion in the final rule, but we are incorporating one aspect of Option 2 into the final rule. In addition, the EPA is including its final approach only in the regulations that apply to the EPA and delegated states. This means that the states that prefer to use an approach like Option 2 will be able to continue to do so.

2. Do Not Support Option 2 a. Brief Summary of Comments

Oil and gas industry commenters were uniformly opposed to Option 2. These commenters stated that the use of “functionality” has no support in the CAA, is inconsistent with the plain meaning of the term “adjacent,” and results in sources that do not resemble in any way a “plant.” In addition, they stated that the use of such a test resulted in significant uncertainty because of the subjective nature of the analysis involved in determining which emissions units are part of the source. Several state permitting authority commenters echoed these sentiments and added that the interrelatedness test adds layers of analysis that is not productive. Several commenters expressed concern about the permitting burden of adopting Option 2. Commenters noted that in two cases where the EPA attempted to assess “functional interrelatedness,” the source determinations took several years, were litigated, and ultimately ended in decisions not to aggregate the various surface sites.

b. EPA Response

Because of the difficulty of applying a “functional interrelatedness” criterion to oil and natural gas operations, the EPA is not adopting this criterion as part of the final rule. We do not agree with all of the comments opposed to Option 2, in particular those that stated Option 2 was beyond the EPA's authority, for similar reasons that we disagree with comments that Option 1 was beyond our authority. We do agree with those that stated applying a “functional interrelatedness” criterion by itself would not reduce permitting burdens for oil and natural gas operations to the same degree as a proximity test alone under Option 1. However, because of concerns discussed above with applying a proximity criterion alone, we are combining the proximity criterion in Option 1 with the element of Option 2 that involves considering whether equipment is related in a manner that meets the common sense notion of a plant. Our selected approach combines these elements by limiting aggregation to pollutant emitting equipment within 1/4 mile of each other, but requires that these sources also have shared equipment. We believe that this approach, unlike applying “functional interrelatedness” outside of a specific perimeter, will limit the amount of analysis required for permitting in the oil and natural gas production and processing segments. By providing a clear limit on the distance within which we would require analysis of the relationship of the equipment, we believe permitting will proceed more quickly, and with more certainty for permitting authorities and the regulated community.

3. Environmental Impact Under Option 2 a. Summary of Proposal

We specifically requested comments on whether there might be any environmental harm or benefit resulting from adopting Option 2.

b. Brief Summary of Comments

One state commenter expressed concern that a strict application of the plain meaning of the term “adjacent” could allow oil and gas companies to manipulate their operations to avoid being considered a major source. Another commenter stated that without aggregation, oil and gas operations are subject to widely varying and less stringent standards under state minor source programs. This commenter believes that subjecting these operations to major source permitting would provide substantial public health and environmental benefits. This commenter believes that the emission control provided by the NSPS is not sufficient because it only addresses new or modified equipment and does not cover all equipment or activities encompassed by the industry and does not address local or regional air quality issues.

Other commenters stated that the proposal would have little to no impact on air emissions because the control technology required if equipment is aggregated into major sources will likely be identical to what is required of minor sources. One commenter listed the numerous federal and state standards that already apply to oil and gas sources, regardless of whether the sources are determined to be major or minor, as evidence that the industry is already subject to stringent emissions control requirements.

c. EPA Response

It is important to understand that even if equipment beyond a 1/4 mile distance is aggregated under something like Option 2, only new or modified equipment would be subject to the control requirements of Best Available Control Technology under PSD or Lowest Achievable Emission Rate under the NNSR permitting program. Most new equipment would also be subject to limitations under the NSPS, whether the source is considered major or minor. Emission control requirements under state and federal minor source programs apply in addition to any requirements of the NSPS. These requirements may be more stringent than the NSPS, and in some states apply to new as well as to existing sources. Title V permitting generally does not result in new control requirements, it only compiles the requirements that exist in the underlying standards, such as the NSPS or NESHAP into one permit.

For these reasons, we believe that aggregating equipment into major sources for title V, PSD or NNSR permitting under Option 2 would result in little environmental benefit over the approach adopted today. In our judgement, Option 2 would be more likely to result in delays in permitting and greater uncertainty for the permitting authorities and regulated community alike.

D. Implementation Issues 1. Requirements for States To Adopt a. Summary of Proposal

We proposed changes to the permitting rules that would have applied both to the EPA, as the permitting authority, to delegated states, and to state, local and tribal permitting authorities. We invited comment on whether states should be required to adopt the proposed changes.

b. Brief Summary of Comments

We received comments from several state and local permitting authorities, including those with and without oil and gas operations, requesting that their programs be allowed to continue to make determinations of “adjacent” on a case-by-case basis without being required to adopt the approach finalized by the EPA. This was particularly true for local programs in California, which have a long history of regulating oil and gas operations. A commenter representing the oil and gas industry operating in California echoed the comment that the existing program should not be disrupted.

c. EPA Response

We agree with commenters who expressed the view that state and local permitting authorities should have the ability to make source determinations under their existing permitting programs. Once their programs are approved by the EPA, state and local governments are given the responsibility to make permitting decisions, and we do not intend any changes in this balance of responsibilities. We, therefore, are adopting these changes in our rules, but not requiring that state and local permitting authorities with approved programs also adopt the new definitions. These permitting authorities may, but are not required to, adopt these definitions, as discussed earlier in this document. This approach has a number of advantages. First, it is responsive to states' concerns that they have much experience making source determinations and they do not see the need to make changes to their existing approach. Second, it would not trigger an obligation for approved states, particularly those states without oil and gas development, to revise their state rules and submit a SIP revision, or to provide a demonstration that their existing rules are of equivalent stringency.

With regard to title V permitting, we are also only adopting these changes in the rules that apply to the EPA and delegated programs. States and local agencies with approved programs may adopt a similar provision in their title V rules at their discretion.

2. Applicability to Other Industries a. Summary of Proposal

In the proposed rule, we stated that we intended to define “adjacent” only for onshore oil and natural gas operations covered by two-digit SIC Major Group 13, for reasons that are discussed more fully in the preamble to the proposed rule. See 80 FR 56586, September 18, 2015.

b. Brief Summary of Comments

We received comments both asking us to and asking us not to apply the definition developed for oil and natural gas operations to all industries. One state commenter stated that permitting authorities and regulated sources in all categories should be subject to the same definition developed for the oil and natural gas industry. A commenter from an industry outside the oil and natural gas industry asked that the EPA confirm that proximity is the only basis on which the EPA will make determinations of adjacency. We also received comments from the transmission and distribution segments of the oil and natural gas sector requesting that the EPA clarify how this rule applies to these segments of the industry.

c. EPA Response

The EPA did not propose this approach for other industries, and, therefore, we are not finalizing this approach for any industry other than onshore oil and natural gas extraction and production within two-digit SIC Major Group 13. It does not apply to the transmission or distribution of oil or natural gas, which is covered under two-digit SIC Major Group 49. We continue to believe, as we stated in our proposal, that the nature of this industry poses unique challenges for making these source determinations, so this approach is warranted for this industry category. Source determinations for other industries will continue to be made on a case-by-case basis.

3. Applicability to Previously Issued Permits a. Summary of Proposal

The EPA did not discuss the application of the proposed options to previously issued permits in the preamble to the proposed rule.

b. Brief Summary of Comments

Several commenters stated that any new rule that the EPA adopts should not be applied retroactively. One commenter urged the EPA to both make it clear that new federal language will be implemented only on a prospective basis, but at the same time asked that any previous decisions made to aggregate sources should be subject to new source determinations under the language finally adopted. Another commenter said that with a new definition of an existing term, some previous determinations will be consistent with the new definition, but others will not. This commenter specifically requested that the EPA include anti-backsliding language in the final rule to minimize the impact on previous determinations. In particular, under this rule surface sites that do not share equipment with other surface sites will not be aggregated, which will simplify permit actions when an independent surface site changes ownership.

c. EPA Response

Historically, the EPA's rules are generally adopted on a prospective basis. That is, a new rule applies only after that rule is effective, and is not be applied retroactively to previous actions. This rule is no different. The EPA intends that this rule will be applied from August 2, 2016 forward. Previous source determinations and issued permits, whether sources were aggregated or not, should not be affected by this new definition of “adjacent”.

V. Environmental Justice Considerations

This document is intended to clarify the definition of “adjacent” used to determine the source to be permitted within the existing PSD, NNSR and title V programs as it applies to oil and natural gas operations. This clarification will assist permitting authorities and permit applicants in making source determinations for the oil and natural gas industry, and is not intended to result in less environmental protection for human health and the environment. It is being finalized as a part of a comprehensive strategy to addresses emissions from the oil and natural gas sector which includes new (or lower) emission standards or requirements for a number of types of emitting equipment. As explained earlier in this document and in detail in our response to comments, the EPA does not anticipate that this rule will create a significant issue for attainment and maintenance of the NAAQS. Therefore, the EPA believes this action will not have a disproportionately high and adverse human health or environmental effects on minority populations or low-income populations.

VI. Statutory and Executive Order Reviews A. Executive Order 12866: Regulatory Planning and Review and Executive Order 13563: Improving Regulation and Regulatory Review

This action is a significant regulatory action that was submitted to the Office of Management and Budget (OMB) for review because it raises novel policy issues regarding one of the President's priorities. Any changes made in response to OMB recommendations have been documented in the docket.

B. Paperwork Reduction Act (PRA)

This action does not impose any new information collection burden. The OMB has previously approved the information collection requirements contained in the existing regulations for PSD (40 CFR 52.21) and title V (40 CFR parts 70 and 71) under the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 et seq. and has assigned OMB control numbers 2060-0003, 2060-0336 and 2060-0243. The OMB control numbers for the EPA's regulations in 40 CFR are listed in 40 CFR part 9. Instead of new information collection burdens, this action finalizes a definition that clarifies the permitting requirements applicable to new and modified oil and natural gas sources. This final action is not likely to increase the burden associated with permitting. It is likely to decrease the burden of permitting for the EPA, when it is the permitting authority. The extent to which it will change the permitting burden for other permitting authorities will depend on whether state or local permitting authorities adopt the changes, and the extent to which these changes are different from the current practice.

C. Regulatory Flexibility Act (RFA)

I certify that this action will not have a significant economic impact on a substantial number of small entities under the RFA. In making this determination, the impact of concern is any significant adverse economic impact on small entities. An agency may certify that a rule will not have a significant economic impact on a substantial number of small entities if a rule relieves regulatory burden, has no net burden or otherwise has a positive economic effect on the small entities subject to the rule. This final rule will not impose any additional requirements on small entities. This action clarifies existing requirements, and, by limiting the area in which an oil and gas source's operations must be analyzed for consideration as a single source, limits the burden on the sources and permitting authorities. Entities potentially affected directly by this final rule include state, local and tribal governments and none of these governments are small entities.

D. Unfunded Mandates Reform Act (UMRA)

This action does not contain an unfunded mandate of $100 million or more as described in the Unfunded Mandates Reform Act of 1995 (UMRA), 2 U.S.C. 1531-1538, and does not significantly or uniquely affect small governments.

E. Executive Order 13132: Federalism

This action does not have federalism implications. It will not have substantial direct effects on the states, on the relationship between the national government and the states, or on the distribution of power and responsibilities among the various levels of government. The requirement to obtain permits for new major sources is imposed by the CAA. This rule would interpret those requirements as they apply to oil and natural gas operations. Thus, Executive Order 13132 does not apply to these regulation revisions. Finally, the EPA is not requiring that states adopt these changes.

F. Executive Order 13175: Consultation and Coordination With Indian Tribal Governments

This action does not have tribal implications, as specified in Executive Order 13175. It would not have a substantial direct effect on one or more Indian tribes, since no tribe has developed a Tribal Implementation Plan that allows it to issue NSR permits and, in any case, we are not requiring any permitting authority other than the EPA and delegated states to adopt these changes. Furthermore, this regulation does not affect the relationship or distribution of power and responsibilities between the federal government and Indian tribes. The CAA and the Tribal Air Rule establish the relationship of the federal government and tribes in characterizing air quality and developing plans to attain the NAAQS, and this regulation does nothing to modify that relationship. Thus, Executive Order 13175 does not apply to this action.

Consistent with the EPA Policy on Consultation and Coordination with Indian tribes, the EPA held several meetings with tribal environmental professionals to discuss issues associated with this rule, including a presentation on a National Tribal Air Association policy call on September 10, 2015, and an outreach call to state, local and tribal permitting authorities on September 15, 2015. These meetings discussed several related oil and gas rules, including this Source Determination rule. Summaries of these meetings are included in the docket for this rule.

The EPA also offered consultation during the rulemaking process, but received no requests. The EPA provided an opportunity for tribes and stakeholders to provide written comments on the proposed rule. One tribe did submit comments and these comments are included in the docket for this rule.

G. Executive Order 13045: Protection of Children From Environmental Health and Safety Risks

The EPA interprets Executive Order 13045 as applying only to those regulatory actions that concern environmental health or safety risks that the EPA has reason to believe may disproportionately affect children, per the definition of “covered regulatory action” in section 2-202 of the Executive Order. This action is not subject to Executive Order 13045 because it does not directly involve an environmental health risk or safety risk.

H. Executive Order 13211: Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use

This action is not a “significant energy action” because it is not likely to have a significant adverse effect on the supply, distribution or use of energy. The EPA is finalizing this clarification to its permitting rules and we believe this action is not likely to have any adverse energy effects because it will not increase, and may decrease, the permitting burden on owners and operators of oil and natural gas sources.

I. National Technology Transfer and Advancement Act

This action does not involve technical standards.

J. Executive Order 12898: Federal Actions To Address Environmental Justice in Minority Populations and Low-Income Populations

The EPA believes the human health or environmental risk addressed by this action will not have potential disproportionately high and adverse human health or environmental effects on any population, including any minority, low-income or indigenous populations, because it does not affect the level of protection provided to human health or the environment. The results of the evaluation of environmental justice considerations is contained in Section V of this preamble titled, “Environmental Justice Considerations.”

K. Congressional Review Act (CRA)

This action is subject to the CRA, and the EPA will submit a rule report to each House of the Congress and to the Comptroller General of the United States. This action is not a “major rule” as defined by 5 U.S.C. 804(2).

L. Judicial Review

Under section 307(b)(1) of the CAA, petitions for judicial review of any nationally applicable regulation, or any action the Administrator “finds and publishes” as based on a determination of nationwide scope or effect must be filed in the United States Court of Appeals for the District of Columbia Circuit within 60 days of the date the promulgation, approval, or action appears in the Federal Register. This action is nationally applicable, as it revises the rules governing all PSD, NNSR and title V programs, in 40 CFR 51.166, 40 CFR 51.165, 40 CFR 52.21, 40 CFR part 70 and 40 CFR part 71. The Administrator also finds that this action is based on a determination of nationwide scope and effect, as it revises the EPA's direct implementation of the PSD and title V programs, which is in effect in multiple Circuits. As a result, petitions for review of this regulation must be filed in the United States Court of Appeals for the District of Columbia Circuit within August 2, 2016. Filing a petition for reconsideration by the Administrator of this final action 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 must be filed, and shall not postpone the effectiveness of this action.

Statutory Authority

The statutory authority for this action is provided by sections 101; 111; 114; 116, 160-165, 169, 173, 301, 302, 501 and 502 of the CAA, as amended (42 U.S.C. 7401; 42 U.S.C. 7411; 42 U.S.C. 7414; 42 U.S.C. 7416; 7470-7475, 7479, 7503, 7601, 7602, 7661, and 7662.

List of Subjects 40 CFR Part 51

Environmental protection, Air pollution control, Construction permit, Intergovernmental relations, Major source, Oil and gas.

40 CFR Part 52

Environmental protection, Air pollution control, Construction permit, Incorporation by reference, Intergovernmental relations, Major source, Oil and gas.

40 CFR Part 70

Environmental protection, Air pollution control, Intergovernmental relations, Major source, Oil and gas, Operating permit.

40 CFR Part 71

Environmental protection, Air pollution control, Intergovernmental relations, Major source, Oil and gas, Operating permit.

Dated: May 12, 2016. Gina McCarthy, Administrator.

For the reasons stated in the preamble, title 40, chapter I of the Code of Federal Regulations is amended as follows:

PART 51—REQUIREMENTS FOR PREPARATION, ADOPTION, AND SUBMITTAL OF IMPLEMENTATION PLANS 1. The authority citation for part 51 continues to read as follows: Authority:

23 U.S.C. 101; 42 U.S.C. 7401-7671q.

2. In § 51.165, revise paragraph (a)(1)(ii) to read as follows:
§ 51.165 Permit requirements.

(a) * * *

(1) * * *

(ii)(A) Building, structure, facility, or installation means all of the pollutant-emitting activities which belong to the same industrial grouping, are located on one or more contiguous or adjacent properties, and are under the control of the same person (or persons under common control) except the activities of any vessel. Pollutant emitting activities shall be considered as part of the same industrial grouping if they belong to the same Major Group (i.e., which have the same two-digit code) as described in the Standard Industrial Classification Manual, 1972, as amended by the 1977 Supplement (U.S. Government Printing Office stock numbers 4101-0065 and 003-005-00176-0, respectively).

(B) The plan may include the following provision: Notwithstanding the provisions of paragraph (a)(1)(ii)(A) of this section, building, structure, facility, or installation means, for onshore activities under Standard Industrial Classification (SIC) Major Group 13: Oil and Gas Extraction, all of the pollutant-emitting activities included in Major Group 13 that are located on one or more contiguous or adjacent properties, and are under the control of the same person (or persons under common control). Pollutant emitting activities shall be considered adjacent if they are located on the same surface site; or if they are located on surface sites that are located within 1/4 mile of one another (measured from the center of the equipment on the surface site) and they share equipment. Shared equipment includes, but is not limited to, produced fluids storage tanks, phase separators, natural gas dehydrators or emissions control devices. Surface site, as used in this paragraph (a)(1)(ii)(B), has the same meaning as in 40 CFR 63.761.

3. In § 51.166, revise paragraph (b)(6) to read as follows:
§ 51.166 Prevention of significant deterioration of air quality.

(b) * * *

(6)(i) Building, structure, facility, or installation means all of the pollutant-emitting activities which belong to the same industrial grouping, are located on one or more contiguous or adjacent properties, and are under the control of the same person (or persons under common control) except the activities of any vessel. Pollutant-emitting activities shall be considered as part of the same industrial grouping if they belong to the same Major Group (i.e., which have the same two-digit code) as described in the Standard Industrial Classification Manual, 1972, as amended by the 1977 Supplement (U.S. Government Printing Office stock numbers 4101-0066 and 003-005-00176-0, respectively).

(ii) The plan may include the following provision: Notwithstanding the provisions of paragraph (b)(6)(i) of this section, building, structure, facility, or installation means, for onshore activities under SIC Major Group 13: Oil and Gas Extraction, all of the pollutant-emitting activities included in Major Group 13 that are located on one or more contiguous or adjacent properties, and are under the control of the same person (or persons under common control). Pollutant emitting activities shall be considered adjacent if they are located on the same surface site; or if they are located on surface sites that are located within 1/4 mile of one another (measured from the center of the equipment on the surface site) and they share equipment. Shared equipment includes, but is not limited to, produced fluids storage tanks, phase separators, natural gas dehydrators or emissions control devices. Surface site, as used in this paragraph (b)(6)(ii), has the same meaning as in 40 CFR 63.761.

4. In appendix S to part 51, revise section II.A.2. to read as follows: Appendix S to Part 51—Emission Offset Interpretative Ruling II. Initial Screening Analyses and Determination of Applicable Requirements

A. * * *

2. (i) Building, structure, facility or installation means all of the pollutant-emitting activities which belong to the same industrial grouping, are located on one or more contiguous or adjacent properties, and are under the control of the same person (or persons under common control) except the activities of any vessel. Pollutant-emitting activities shall be considered as part of the same industrial grouping if they belong to the same “Major Group” (i.e., which have the same two digit code) as described in the Standard Industrial Classification Manual, 1972, as amended by the 1977 Supplement (U.S. Government Printing Office stock numbers 4101-0066 and 003-005-00176-0, respectively).

(ii) Notwithstanding the provisions of paragraph II.A.2(i) of this section, building, structure, facility or installation means, for onshore activities under SIC Major Group 13: Oil and Gas Extraction, all of the pollutant-emitting activities included in Major Group 13 that are located on one or more contiguous or adjacent properties, and are under the control of the same person (or persons under common control). Pollutant emitting activities shall be considered adjacent if they are located on the same surface site; or if they are located on surface sites that are located within 1/4 mile of one another (measured from the center of the equipment on the surface site) and they share equipment. Shared equipment includes, but is not limited to, produced fluids storage tanks, phase separators, natural gas dehydrators or emissions control devices. Surface site, as used in this paragraph II.A.2(ii), has the same meaning as in 40 CFR 63.761.

PART 52—APPROVAL AND PROMULGATION OF IMPLEMENTATION PLANS 5. The authority citation for part 52 continues to read as follows: Authority:

42 U.S.C. 7401 et seq.

6. In § 52.21, revise paragraph (b)(6) to read as follows:
§ 52.21 Prevention of significant deterioration of air quality.

(b) * * *

(6)(i) Building, structure, facility, or installation means all of the pollutant-emitting activities which belong to the same industrial grouping, are located on one or more contiguous or adjacent properties, and are under the control of the same person (or persons under common control) except the activities of any vessel. Pollutant-emitting activities shall be considered as part of the same industrial grouping if they belong to the same “Major Group” (i.e., which have the same first two digit code) as described in the Standard Industrial Classification Manual, 1972, as amended by the 1977 Supplement (U.S. Government Printing Office stock numbers 4101-0066 and 003-005-00716-0, respectively).

(ii) Notwithstanding the provisions of paragraph (b)(6)(i) of this section, building, structure, facility, or installation means, for onshore activities under Standard Industrial Classification (SIC) Major Group 13: Oil and Gas Extraction, all of the pollutant-emitting activities included in Major Group 13 that are located on one or more contiguous or adjacent properties, and are under the control of the same person (or persons under common control). Pollutant emitting activities shall be considered adjacent if they are located on the same surface site; or if they are located on surface sites that are located within 1/4 mile of one another (measured from the center of the equipment on the surface site) and they share equipment. Shared equipment includes, but is not limited to, produced fluids storage tanks, phase separators, natural gas dehydrators or emissions control devices. Surface site, as used in this paragraph (b)(6)(ii), has the same meaning as in 40 CFR 63.761.

PART 70—STATE OPERATING PERMIT PROGRAMS 7. The authority citation for part 70 continues to read as follows: Authority:

42 U.S.C. 7401, et seq.

8. In § 70.2, revise the introductory text of the definition for “Major source” to read as follows:
§ 70.2 Definitions.

Major source means any stationary source (or any group of stationary sources that are located on one or more continuous or adjacent properties, and are under common control of the same person (or persons under common control)) belonging to a single major industrial grouping and that are described in paragraph (1), (2), or (3) of this definition. For the purposes of defining “major source,” a stationary source or group of stationary sources shall be considered part of a single industrial grouping if all of the pollutant emitting activities at such source or group of sources on contiguous or adjacent properties belong to the same Major Group (i.e., all have the same two-digit code) as described in the Standard Industrial Classification Manual, 1987. State programs may adopt the following provision: For onshore activities belonging to Standard Industrial Classification (SIC) Major Group 13: Oil and Gas Extraction, pollutant emitting activities shall be considered adjacent if they are located on the same surface site; or if they are located on surface sites that are located within 1/4 mile of one another (measured from the center of the equipment on the surface site) and they share equipment. Shared equipment includes, but is not limited to, produced fluids storage tanks, phase separators, natural gas dehydrators or emissions control devices. Surface site, as used in the introductory text of this definition, has the same meaning as in 40 CFR 63.761.

PART 71—FEDERAL OPERATING PERMIT PROGRAMS 9. The authority citation for part 71 continues to read as follows: Authority:

42 U.S.C. 7401, et seq.

Subpart A—Operating Permits 10. In § 71.2, revise the introductory text of the definition for “Major sources” to read as follows:
§ 71.2 Definitions.

Major source means any stationary source (or any group of stationary sources that are located on one or more contiguous or adjacent properties, and are under common control of the same person (or persons under common control)), belonging to a single major industrial grouping and that are described in paragraph (1), (2), or (3) of this definition. For the purposes of defining “major source,” a stationary source or group of stationary sources shall be considered part of a single industrial grouping if all of the pollutant emitting activities at such source or group of sources on contiguous or adjacent properties belong to the same Major Group (i.e., all have the same two-digit code) as described in the Standard Industrial Classification Manual, 1987. For onshore activities belonging to Standard Industrial Classification (SIC) Major Group 13: Oil and Gas Extraction, pollutant emitting activities shall be considered adjacent if they are located on the same surface site; or if they are located on surface sites that are located within 1/4 mile of one another (measured from the center of the equipment on the surface site) and they share equipment. Shared equipment includes, but is not limited to, produced fluids storage tanks, phase separators, natural gas dehydrators or emissions control devices. Surface site, as used in the introductory text of this definition, has the same meaning as in 40 CFR 63.761.

[FR Doc. 2016-11968 Filed 6-2-16; 8:45 am] BILLING CODE 6560-50-P
ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 52 [EPA-R04-OAR-2016-0072; FRL-9947-22-Region 4] Air Plan Approval; North Carolina; Prong 4—2008 Ozone, 2010 NO2, SO2, and 2012 PM2.5 AGENCY:

Environmental Protection Agency.

ACTION:

Final rule.

SUMMARY:

The Environmental Protection Agency (EPA) is approving portions of revisions to the North Carolina State Implementation Plan (SIP), submitted by the North Carolina Department of Environment and Natural Resources (NC DENR), addressing the Clean Air Act (CAA or Act) visibility transport (prong 4) infrastructure SIP requirements for the 2008 8-hour Ozone, 2010 1-hour Nitrogen Dioxide (NO2), 2010 1-hour Sulfur Dioxide (SO2), and 2012 annual Fine Particulate Matter (PM2.5) National Ambient Air Quality Standards (NAAQS). The CAA requires that each state adopt and submit a SIP for the implementation, maintenance, and enforcement of each NAAQS promulgated by EPA, commonly referred to as an “infrastructure SIP.” Specifically, EPA is approving the prong 4 portions of North Carolina's November 2, 2012, 2008 8-hour Ozone infrastructure SIP submission; August 23, 2013, 2010 1-hour NO2 infrastructure SIP submission; March 18, 2014, 2010 1-hour SO2 infrastructure SIP submission; and December 4, 2015, 2012 Annual PM2.5 infrastructure SIP submission. All other applicable infrastructure requirements for these SIP submissions have been or will be addressed in separate rulemakings.

DATES:

This rule is effective July 5, 2016.

ADDRESSES:

EPA has established a docket for this action under Docket Identification No. EPA-R04-OAR-2016-0072. All documents in the docket are listed on the http://www.regulations.gov Web site. Although listed in the index, some information may not be publicly available, i.e., Confidential Business Information or other information whose disclosure is restricted by statute. Certain other material, such as copyrighted material, is not placed on the Internet and will be publicly available only in hard copy form. Publicly available docket materials are available either electronically through http://www.regulations.gov or in hard copy at the Air Regulatory Management Section, Air Planning and Implementation Branch, Air, Pesticides and Toxics Management Division, U.S. Environmental Protection Agency, Region 4, 61 Forsyth Street SW., Atlanta, Georgia 30303-8960. EPA requests that if at all possible, you contact the person listed in the FOR FURTHER INFORMATION CONTACT section to schedule your inspection. The Regional Office's official hours of business are Monday through Friday 8:30 a.m. to 4:30 p.m., excluding federal holidays.

FOR FURTHER INFORMATION CONTACT:

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

SUPPLEMENTARY INFORMATION:

I. Background

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

Section 110(a)(2)(D) has two components: 110(a)(2)(D)(i) and 110(a)(2)(D)(ii). Section 110(a)(2)(D)(i) includes four distinct components, commonly referred to as “prongs,” that must be addressed in infrastructure SIP submissions. The first two prongs, which are codified in section 110(a)(2)(D)(i)(I), are provisions that prohibit any source or other type of emissions activity in one state from contributing significantly to nonattainment of the NAAQS in another state (prong 1) and from interfering with maintenance of the NAAQS in another state (prong 2). The third and fourth prongs, which are codified in section 110(a)(2)(D)(i)(II), are provisions that prohibit emissions activity in one state from interfering with measures required to prevent significant deterioration of air quality in another state (prong 3) or from interfering with measures to protect visibility in another state (prong 4). Section 110(a)(2)(D)(ii) requires SIPs to include provisions ensuring compliance with sections 115 and 126 of the Act, relating to interstate and international pollution abatement.

North Carolina's November 2, 2012, 2008 8-hour Ozone submission; August 23, 2013, 2010 1-hour NO2 submission; March 18, 2014, 2010 1-hour SO2 submission; and December 4, 2015, 2012 Annual PM2.5 submission cite to the State's regional haze SIP as satisfying prong 4 requirements. However, at those dates, EPA had not yet fully approved North Carolina's regional haze SIP because the SIP relied on the Clean Air Interstate Rule (CAIR) to satisfy the nitrogen oxides (NOX) and SO2 Best Available Retrofit Technology (BART) requirements for the CAIR-subject electric generating units (EGUs) in the State and the requirement for a long-term strategy (LTS) sufficient to achieve the state-adopted reasonable progress goals.1

1 CAIR, promulgated in 2005, required 27 states and the District of Columbia to reduce emissions of NOX and SO2 that significantly contribute to, or interfere with maintenance of, the 1997 NAAQS for fine particulates and/or ozone in any downwind state. CAIR imposed specified emissions reduction requirements on each affected State, and established an EPA-administered cap and trade program for EGUs in which States could join as a means to meet these requirements.

EPA demonstrated that CAIR achieved greater reasonable progress toward the national visibility goal than BART for NOX and SO2 at BART-eligible EGUs in CAIR affected states, and revised the regional haze rule (RHR) to provide that states participating in CAIR's cap-and-trade program need not require affected BART-eligible EGUs to install, operate, and maintain BART for emissions of SO2 and NOX. See 70 FR 39104 (July 6, 2005). As a result, a number of states in the CAIR region designed their regional haze SIPs to rely on CAIR as an alternative to NOX and SO2 BART for CAIR-subject EGUs. These states also relied on CAIR as an element of a LTS for achieving their reasonable progress goals.

The United States Court of Appeals for the District of Columbia Circuit (D.C. Circuit) initially vacated CAIR in 2008,2 but ultimately remanded the rule to EPA without vacatur to preserve the environmental benefits provided by CAIR.3 On August 8, 2011, acting on the D.C. Circuit's remand, EPA promulgated the Cross State Air Pollution Rule (CSAPR) to replace CAIR and thus to address the interstate transport of emissions contributing to nonattainment and interfering with maintenance of the two air quality standards covered by CAIR as well as the 2006 PM2.5 NAAQS.4 See 76 FR 48208.

2North Carolina v. EPA, 531 F.3d 896 (D.C. Cir. 2008).

3North Carolina v. EPA, 550 F.3d 1176 (D.C. Cir. 2008).

4 Although a number of parties challenged the legality of CSAPR and the D.C. Circuit initially vacated and remanded CSAPR to EPA in EME Homer City Generation, L.P. v. EPA, 696 F.3d 7, 38 (D.C. Cir. 2012), the United States Supreme Court reversed the D.C. Circuit's decision on April 29, 2014, and remanded the case to the D.C. Circuit to resolve remaining issues in accordance with the high court's ruling. EPA v. EME Homer City Generation, L.P., 134 S. Ct. 1584 (2014). On remand, the D.C. Circuit affirmed CSAPR in most respects and CSAPR is now in effect. EME Homer City Generation, L.P. v. EPA, 795 F.3d 118 (D.C. Cir. 2015).

Due to CAIR's status as a temporary measure following the D.C. Circuit's 2008 ruling, EPA could not fully approve regional haze SIP revisions to the extent that they relied on CAIR to satisfy the BART requirement and the requirement for a long-term strategy sufficient to achieve the state-adopted reasonable progress goals. On these grounds, EPA finalized a limited disapproval of North Carolina's regional haze SIP on June 7, 2012, triggering the requirement for EPA to promulgate a federal implementation plan (FIP) unless North Carolina submitted and EPA approved a SIP revision that corrected the deficiency. See 77 FR 33642. EPA finalized a limited approval of North Carolina's regional haze SIP on June 27, 2012, as meeting the remaining applicable regional haze requirements set forth in the CAA and the RHR. See 77 FR 38185.

On October 31, 2014, North Carolina submitted a regional haze plan revision to correct the deficiencies identified in the June 7, 2012, limited disapproval by replacing reliance on CAIR with reliance on a BART alternative to satisfy NOX and SO2 BART requirements for EGUs formerly subject to CAIR. EPA finalized approval of the October 31, 2014, SIP revision and converted North Carolina's regional haze plan from a limited approval to a full approval on May 12, 2016. That action also removed EPA's obligation to implement a FIP to correct the previous deficiencies for North Carolina's initial regional haze plan.

In a proposed rulemaking (NPRM) published on April 8, 2016 (81 FR 20600), EPA proposed to approve the prong 4 portions of North Carolina's infrastructure SIP submissions for the 2008 8-hour Ozone, 2010 1-hour NO2, 2010 1-hour SO2, and 2012 annual PM2.5 NAAQS based on final approval of the State's October 31, 2014, SIP revision. As discussed above, EPA subsequently finalized that SIP revision and converted North Carolina's regional haze plan from a limited approval to a full approval. The details of the aforementioned North Carolina infrastructure SIP submissions and the rationale for EPA's action is explained in the NPRM. Comments on the proposed rulemaking were due on or before April 29, 2016. EPA received no adverse comments on the proposed action.

II. Final Action

EPA is approving the prong 4 portions of North Carolina's November 2, 2012, 2008 8-hour Ozone infrastructure SIP submission; August 23, 2013, 2010 1-hour NO2 infrastructure SIP submission; March 18, 2014, 2010 1-hour SO2 infrastructure SIP submission; and December 4, 2015, 2012 Annual PM2.5 infrastructure SIP submission. All other applicable infrastructure requirements for these SIP submissions have been or will be addressed in separate rulemakings.

III. Statutory and Executive Order Reviews

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

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

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

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

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

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

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

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

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

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

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

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

Under section 307(b)(1) of the CAA, petitions for judicial review of this action must be filed in the United States Court of Appeals for the appropriate circuit by August 2, 2016. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements. See section 307(b)(2).

List of Subjects in 40 CFR Part 52

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

Dated: May 23, 2016. Heather McTeer Toney, Regional Administrator, Region 4.

40 CFR part 52 is amended as follows:

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

42 U.S.C. 7401 et seq.

Subpart II—North Carolina 2. Section 52.1770(e), is amended by adding new entries for “110(a)(1) and (2) Infrastructure Requirements for the 2008 8-Hour Ozone NAAQS”, “110(a)(1) and (2) Infrastructure Requirements for the 2010 1-hour NO2 NAAQS”, “110(a)(1) and (2) Infrastructure Requirements for the 2010 1-hour SO2 NAAQS” and “110(a)(1) and (2) Infrastructure Requirements for the 2012 Annual PM2.5 NAAQS” at the end of the table to read as follows:
§ 52.1770 Identification of plan.

(e) * * *

EPA-Approved North Carolina Non-Regulatory Provisions Provision State
  • effective
  • date
  • EPA
  • approval
  • date
  • Federal Register
  • citation
  • Explanation
    *         *         *         *         *         *         * 110(a)(1) and (2) Infrastructure Requirements for the 2008 8-Hour Ozone NAAQS 11/2/2012 6/3/2016 [Insert citation of publication in Federal Register] Addressing prong 4 of section 110(a)(2)(D)(i) only. 110(a)(1) and (2) Infrastructure Requirements for the 2010 1-hour NO2 NAAQS 8/23/2013 6/3/2016 [Insert citation of publication in Federal Register] Addressing prong 4 of section 110(a)(2)(D)(i) only. 110(a)(1) and (2) Infrastructure Requirements for the 2010 1-hour SO2 NAAQS 3/18/2014 6/3/2016 [Insert citation of publication in Federal Register] Addressing prong 4 of section 110(a)(2)(D)(i) only. 110(a)(1) and (2) Infrastructure Requirements for the 2012 Annual PM2.5 NAAQS 12/4/2015 6/3/2016 [Insert citation of publication in Federal Register] Addressing prong 4 of section 110(a)(2)(D)(i) only.
    [FR Doc. 2016-13036 Filed 6-2-16; 8:45 am] BILLING CODE 6560-50-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 52 [EPA-R01-OAR-2015-0198; FRL-9940-14-Region 1] Approval and Promulgation of Implementation Plans; Connecticut; Infrastructure Requirements for Lead, Ozone, Nitrogen Dioxide, Sulfur Dioxide, and Fine Particulate Matter AGENCY:

    Environmental Protection Agency (EPA).

    ACTION:

    Final rule.

    SUMMARY:

    The Environmental Protection Agency (EPA) is approving elements of State Implementation Plan (SIP) submissions from Connecticut regarding the infrastructure requirements of the Clean Air Act (CAA or Act) for the 2008 lead, 2008 ozone, 2010 nitrogen dioxide, and 2010 sulfur dioxide National Ambient Air Quality Standards (NAAQS). EPA is also converting conditional approvals for several infrastructure requirements for the 1997 ozone NAAQS and for the 1997 and 2006 fine particle (PM2.5) NAAQS to full approval under the CAA. Furthermore, we are conditionally approving elements of Connecticut's infrastructure requirements of the CAA regarding prevention of significant deterioration requirements to treat nitrogen oxides as a precursor to ozone and to establish a minor source baseline date for PM2.5 emissions. Lastly, EPA is approving three statutes submitted by Connecticut in support of its demonstration that the infrastructure requirements of the CAA have been met. The infrastructure requirements are designed to ensure that the structural components of each state's air quality management program are adequate to meet the state's responsibilities under the CAA.

    DATES:

    This rule is effective on July 5, 2016.

    ADDRESSES:

    EPA has established a docket for this action under Docket Identification No. EPA-R01-OAR-2015-0198. All documents in the docket are listed on the http://www.regulations.gov Web site, although some information, such as confidential business information or other information whose disclosure is restricted by statute is not publically available. Certain other material, such as copyrighted material, is not placed on the Internet and will be publicly available only in hard copy form. Publicly available docket materials are available at http://www.regulations.gov or at the U.S. Environmental Protection Agency, EPA New England Regional Office, Office of Ecosystem Protection, Air Quality Planning Unit, 5 Post Office Square, Suite 100, Boston, MA. EPA requests that if at all possible, you contact the contact listed in the FOR FURTHER INFORMATION CONTACT section to schedule your inspection. The Regional Office's official hours of business are Monday through Friday, 8:30 a.m. to 4:30 p.m., excluding legal holidays. Copies of the documents relevant to this action are also available for public inspection during normal business hours, by appointment at: Bureau of Air Management, Department of Energy and Environmental Protection, State Office Building, 79 Elm Street, Hartford, CT 06106-1630.

    FOR FURTHER INFORMATION CONTACT:

    Alison C. Simcox, Environmental Scientist, Air Quality Planning Unit, Air Programs Branch (Mail Code OEP05-02), U.S. Environmental Protection Agency, Region 1, 5 Post Office Square, Suite 100, Boston, Massachusetts 02109-3912; (617) 918-1684; [email protected]

    SUPPLEMENTARY INFORMATION:

    Throughout this document whenever “we,” “us,” or “our” is used, we mean EPA.

    Organization of this document. The following outline is provided to aid in locating information in this preamble.

    I. Background and Purpose II. Final Action III. Statutory and Executive Order Reviews I. Background and Purpose

    This rulemaking addresses submissions from the Connecticut Department of Energy and Environmental Protection (CT DEEP). The state submitted its infrastructure SIP for each NAAQS on the following dates: 2008 Pb—October 13, 2011; 2008 ozone—December 28, 2012; 2010 NO2—January 2, 2013; and 2010 SO2—May 30, 2013. This rulemaking also addresses certain infrastructure SIP elements for the 1997 and 2006 PM2.5 NAAQS for which EPA previously issued a conditional approval. See 77 FR 63228 (October 16, 2012). The state submitted these infrastructure SIPs on September 4, 2008, and September 18, 2009, respectively. Lastly, this rulemaking addresses one infrastructure SIP element for the 1997 8-hour ozone NAAQS for which EPA previously issued a conditional approval. See 76 FR 40248 (July 8, 2011). The state submitted this infrastructure SIP on December 28, 2007.

    EPA did not receive any comments, adverse or otherwise, in response to the Notice of Proposed Rulemaking (NPR). See 80 FR 54471 (September 10, 2015).

    II. Final Action

    EPA is approving SIP submissions from Connecticut certifying that the state's current SIP is sufficient to meet the required infrastructure elements under sections 110(a)(1) and 110(a)(2) for the 2008 Pb, 2008 ozone, 2010 NO2, and 2010 SO2 NAAQS, with the exception of certain aspects relating to PSD which we are conditionally approving. A summary of EPA's actions regarding these infrastructure SIP requirements is contained in Table 1 below.

    Table 1—Action Taken on CT Infrastructure SIP Submittals for Listed NAAQS Element 2008
  • Pb
  • 2008
  • Ozone
  • 2010
  • NO2
  • 2010
  • SO2
  • (A): Emission limits and other control measures A A A A (B): Ambient air quality monitoring and data system A A A A (C)(i): Enforcement of SIP measures A A A A (C)(ii): PSD program for major sources and major modifications  A *  A *  A *  A * (C)(iii): Permitting program for minor sources and minor modifications A A A A (D)(i)(I): Contribute to nonattainment/interfere with maintenance of NAAQS (prongs 1 and 2) A No action A No action (D)(i)(II): PSD (prong 3)  A *  A *  A *  A * (D)(i)(II): Visibility Protection (prong 4) A A A A (D)(ii): Interstate Pollution Abatement A A A A (D)(ii): International Pollution Abatement A A A A (E)(i): Adequate resources A A A A (E)(ii): State boards A A A A (E)(iii): Necessary assurances with respect to local agencies NA NA NA NA (F): Stationary source monitoring system A A A A (G): Emergency power A A A A (H): Future SIP revisions A A A A (I): Nonattainment area plan or plan revisions under part D + + + + (J)(i): Consultation with government officials A A A A (J)(ii): Public notification A A A A (J)(iii): PSD  A *  A *  A *  A * (J)(iv): Visibility protection + + + + (K): Air quality modeling and data A A A A (L): Permitting fees A A A A (M): Consultation and participation by affected local entities A A A A

    In the above table, the key is as follows:

    A Approve A * Approve, but conditionally approve aspect relating to NOX as a precursor to ozone and minor source baseline date for PM2.5 under the PSD program. + Not germane to infrastructure SIPs. No action EPA is taking no action on this infrastructure requirement. NA Not applicable.

    With respect to the 1997 and 2006 PM2.5 NAAQS, EPA is approving Connecticut's infrastructure SIP submittal requirements pertaining to Elements 110(a)(2)A, D(ii) (interstate pollution abatement), and E(ii) (state boards) for which a conditional approval was previously issued. See 77 FR 63228, October 16, 2012. Also with respect to the 1997 and 2006 PM2.5 NAAQS, EPA is newly conditionally approving Connecticut's submittals pertaining to Elements 110(a)(2)C(ii), D(i)(II), and J(iii) for the requirements to treat NOX as a precursor to ozone and to establish a minor source baseline date for PM2.5 in the PSD program.

    With respect to the 1997 8-hour ozone NAAQS, EPA is approving Connecticut's infrastructure SIP submittal requirements pertaining to Element 110(a)(2)(D)(ii) (interstate pollution abatement) for which a conditional approval was previously issued. See 77 FR 63228, October 16, 2012.

    In addition, we are incorporating into the Connecticut SIP the following Connecticut statutes which were included for approval in Connecticut's infrastructure SIP submittals:

    Connecticut General Statutes (CGS) Section 1-85 (Formerly Sec. 1-68) “Interest in conflict with discharge of duties,” as published in the General Statutes of Connecticut revised to January 1, 2015; amended in Public Act 89-97 in January 1989, effective October 1, 1989; CGS Section 22a-171 (Formerly Sec. 19-507) “Duties of Commissioner of Energy and Environmental Protection,” as published in the General Statutes of Connecticut revised to January 1, 2013; amended in Public Act 84-546 in 1984, effective October 1, 1984; CGS Section 16a-21a “Sulfur content of home heating oil and off-road diesel fuel. Suspension of requirements for emergency,” as published in the General Statutes of Connecticut revised to January 1, 2013, effective July 1, 2011.

    As noted in Table 1, EPA is conditionally approving Connecticut's commitment for sub-element sections 110(a)(2)(C)(ii), (D)(i)(II) and (J)(iii) with respect to the 2008 Pb, 2008 ozone, 2010 NO2, and 2010 SO2 NAAQS, as well as newly conditionally approving the state's submittals for these sub-elements with respect to the 1997 and 2006 PM2.5 NAAQS. In a letter dated August 5, 2015, Connecticut committed to adopt and submit to EPA, one year from the publication of this conditional approval, regulatory revisions to Connecticut's prevention of significant deterioration and new source review permitting requirements that meet the requirements to treat NOX as a precursor pollutant to ozone and to establish a minor source baseline date for PM2.5.

    Under section 110(k)(4) of the Act, EPA may conditionally approve a plan based on a commitment from the State to adopt specific enforceable measures by a date certain, but not later than one year from the date of approval. By this date, the State must meet its commitment made in its August 5, 2015 letter to submit revisions to its PSD program that fully meet the requirements above. If the State fails to do so, this action will become a disapproval one year from the date of publication of final approval. EPA will notify the State by letter that this action has occurred. At that time, this commitment will no longer be a part of the approved Connecticut SIP. EPA subsequently will publish a document in the Federal Register notifying the public that the conditional approval is converted to a disapproval. If the State meets its commitment within the applicable time frame, the conditionally approved submission will remain a part of the SIP until EPA takes final action approving or disapproving the new submittal. If EPA disapproves the new submittal, the conditionally approved portions of Connecticut's Infrastructure SIP submittals will also be disapproved at that time. If EPA approves the revised PSD program submittal, then the portions of Connecticut's infrastructure SIP submittals that were conditionally approved will be fully approved in their entirety. In addition, final disapproval of an infrastructure SIP submittal triggers the Federal implementation plan (FIP) requirement under section 110(c).

    Other specific requirements of infrastructure SIPs and the rationale for EPA's final action on Connecticut's submittals are explained in the NPR and will not be restated here.

    III. Statutory and Executive Order Reviews

    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).

    In addition, the SIP is not approved to apply on any Indian reservation land or in any other area where EPA or an Indian tribe has demonstrated that a tribe has jurisdiction. In those areas of Indian country, the rule does not have tribal implications and will not impose substantial direct costs on tribal governments or preempt tribal law as specified by Executive Order 13175 (65 FR 67249, November 9, 2000).

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

    Under section 307(b)(1) of the 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 August 2, 2016. Filing a petition for reconsideration by the Administrator of this final rule does not affect the finality of this action for the purposes of judicial review nor does it extend the time within which a petition for judicial review may be filed, and shall not postpone the effectiveness of such rule or action. This action may not be challenged later in proceedings to enforce its requirements. (See section 307(b)(2).)

    List of Subjects in 40 CFR Part 52

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

    Dated: December 3, 2015. H. Curtis Spalding, Regional Administrator, EPA New England.

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

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

    42 U.S.C. 7401 et seq.

    Subpart H—Connecticut
    2. Section 52.370 is amended by adding reserved paragraph (c)(111) and adding paragraph (c)(112) to read as follows:
    § 52.370 Identification of plan.

    (c) * * *

    (111) [Reserved]

    (112) Revisions to the State Implementation Plan submitted by the Connecticut Department of Energy and Environmental Protection on December 28, 2007; September 4, 2008; September 18, 2009; October 13, 2011; December 28, 2012; January 2, 2013; and May 30, 2013.

    (i) [Reserved.]

    (ii) Additional materials.

    (A) The Connecticut Department of Energy and Environmental Protection document, “Adequacy Determination of the Connecticut State Implementation Plan with Regard to Clean Air Act Section 110(a)(1) and (2) for the 8-Hour Ozone National Ambient Air Quality Standard Program Infrastructure,” Final, December 28, 2007.

    (B) The Connecticut Department of Energy and Environmental Protection document, “Adequacy Determination of the Connecticut State Implementation Plan for Clean Air Act Section 110(a) Infrastructure Elements: 1997 National Ambient Air Quality Standard for Fine Particulate Matter,” Final, September 4, 2008.

    (C) The Connecticut Department of Energy and Environmental Protection document, “Adequacy Determination of the Connecticut State Implementation Plan with Regard to Clean Air Act Section 110(a)(1) and (2) for the 2006 Fine Particulate Matter National Ambient Air Quality Standard,” Final, September 18, 2009.

    (D) The Connecticut Department of Energy and Environmental Protection document, “Request to Withdraw a Portion of Connecticut's PM2.5 Infrastructure Adequacy Determination,” January 7, 2011.

    (E) The Connecticut Department of Energy and Environmental Protection document, “Addendum to the CAA § 110(a)(2)(D)(i)(I) Portion of Connecticut's Infrastructure Submittal for the 2006 PM2.5 NAAQS,” August 19, 2011.

    (F) The Connecticut Department of Energy and Environmental Protection document, “Adequacy Determination of the Connecticut State Implementation Plan with Regard to Clean Air Act Section 110(a)(1) and

    (2) for the 2008 Lead National Ambient Air Quality Standard,” Final, October 13, 2011.

    (G) The Connecticut Department of Energy and Environmental Protection document, “Update to Connecticut PM2.5 Infrastructure Submittals,” June 15, 2012.

    (H) The Connecticut Department of Energy and Environmental Protection document, “Connecticut State Implementation Plan with Regard to the Infrastructure Requirements of Clean Air Act Section 110(a)(1) and 110(s)(2) for the 2008 Ozone National Ambient Air Quality Standards, Final, December 28, 2012.

    (I) The Connecticut Department of Energy and Environmental Protection document, “Connecticut State Implementation Plan with Regard to the Infrastructure Requirements of Clean Air Act Section 110(a)(1) and 110(a)(2) for the 2010 Nitrogen Dioxide National Ambient Air Quality Standards, Final, January 2, 2013.

    (J) The Connecticut Department of Energy and Environmental Protection document, “Connecticut State Implementation Plan for Clean Air Act Section 110(a) Infrastructure Elements: 2010 Sulfur Dioxide National Ambient Air Quality Standard, Final, May 30, 2013.

    (K) The Connecticut Department of Energy and Environmental Protection letter, “Supplement to Infrastructure State Implementation Plan (SIP) Revisions,” August 5, 2015.

    3. Section 52.380 is amended by adding paragraphs (f), (g), and (h) to read as follows:
    § 52.380 Rules and regulations.

    Note 1 to paragraphs (f) through (h): “state” means the state of Connecticut.

    (f) Connecticut General Statutes Section 1-85. (Formerly Sec. 1-68). Interest in conflict with discharge of duties: A public official, including an elected state official, or state employee has an interest which is in substantial conflict with the proper discharge of his duties or employment in the public interest and of his responsibilities as prescribed in the laws of this state, if he has reason to believe or expect that he, his spouse, a dependent child, or a business with which he is associated will derive a direct monetary gain or suffer a direct monetary loss, as the case may be, by reason of his official activity. A public official, including an elected state official, or state employee does not have an interest which is in substantial conflict with the proper discharge of his duties in the public interest and of his responsibilities as prescribed by the laws of this state, if any benefit or detriment accrues to him, his spouse, a dependent child, or a business with which he, his spouse or such dependent child is associated as a member of a profession, occupation or group to no greater extent than any other member of such profession, occupation or group. A public official, including an elected state official or state employee who has a substantial conflict may not take official action on the matter.

    (g) Connecticut General Statutes Section 22a-171. (Formerly Sec. 19-507). Duties of Commissioner of Energy and Environmental Protection: The Commissioner of Energy and Environmental Protection of the State of Connecticut shall:

    (1) Initiate and supervise programs for the purposes of determining the causes, effect and hazards of air pollution;

    (2) Initiate and supervise state-wide programs of air pollution control education;

    (3) Cooperate with and receive money from the Federal Government and, with the approval of the Governor, from any other public or private source;

    (4) Adopt, amend, repeal and enforce regulations as provided in Connecticut General Statutes Section 22a-174 and do any other act necessary to enforce the provisions of Connecticut General Statutes Chapter 446c and Connecticut General Statutes Section 14-164c;

    (5) Advise and consult with agencies of the United States, agencies of the state, political subdivisions and industries and any other affected groups in furtherance of the purposes of Connecticut General Statutes Chapter 446c.

    (h) Connecticut General Statutes Section 16a-21a. Sulfur content of home heating oil and off-road diesel fuel. Suspension of requirements for emergency. (1)(i) The amount of sulfur content of the following fuels sold, offered for sale, distributed or used in this state shall not exceed the following percentages by weight:

    (A) For number two heating oil, three-tenths of one per cent; and

    (B) For number two off-road diesel fuel, three-tenths of one per cent.

    (ii) Notwithstanding paragraph (h)(1)(i) of this section, the amount of sulfur content of number two heating oil sold, offered for sale, distributed or used in this state shall not exceed the following percentages by weight:

    (A) For the period beginning July 1, 2011, and ending June 30, 2014, fifty parts per million; and

    (B) On and after July 1, 2014, fifteen parts per million.

    (iii) The provisions of paragraph (h)(1)(ii) of this section shall not take effect until the states of New York, Massachusetts and Rhode Island each have adopted requirements that are substantially similar to the provisions of said paragraph (h)(1)(ii).

    (2) As of the date on which the last of the states of New York, Massachusetts and Rhode Island limits the sulfur content of number two heating oil to one thousand five hundred parts per million, the sulfur content of number two heating oil sold, offered for sale, distributed or used in this state shall not exceed one thousand five hundred parts per million.

    (3) As of the date on which the last of the states of New York, Massachusetts and Rhode Island limits the sulfur content of number two heating oil to one thousand two hundred fifty parts per million, the sulfur content of number two heating oil sold, offered for sale, distributed or used in this state shall not exceed one thousand two hundred fifty parts per million.

    (4) As of the date on which the last of the states of New York, Massachusetts and Rhode Island limits the sulfur content of number two heating oil to five hundred parts per million, the sulfur content of number two heating oil sold, offered for sale, distributed or used in this state shall not exceed five hundred parts per million.

    (5) As of the date on which the last of the states of New York, Massachusetts and Rhode Island limits the sulfur content of number two off-road diesel fuel to five hundred parts per million, the sulfur content of number two off-road diesel fuel offered for sale, distributed or used in this state shall not exceed five hundred parts per million.

    (6) The Commissioner of Energy and Environmental Protection of the State of Connecticut may suspend the requirements of subsections (a) to (e), inclusive, of this Connecticut General Statutes Section 16a-21a if the commissioner finds that the physical availability of fuel which complies with such requirements is inadequate to meet the needs of residential, commercial or industrial users in this state and that such inadequate physical availability constitutes an emergency provided the commissioner shall specify in writing the period of time such suspension shall be in effect.

    Note 2 to paragraph (h): EPA has replaced the original structure of the CT statute with the structure of the CFR and uses “paragraph” instead of the original statutory language of “subsection” and “subdivision.” EPA has also replaced the (a)-level of the original statute with the (1)-level in the CFR and the (1)-level in the original statute with the (i)-level in the CFR.

    4. In § 52.385, Table 52.385 is amended by adding an entry for Section 1-85, revising the entry for Section 16a-21a, and adding new an entry for Section 22a-171 to read as follows:
    § 52.385 EPA-approved Connecticut regulations. Table 52.385—EPA-Approved Regulations Connecticut state citation Title/subject Dates Date adopted by state Date
  • approved by EPA
  • Federal Register citation Section
  • 52.370
  • Comments/
  • description
  • *         *         *         *         *         *         * Connecticut General Statutes Interest in conflict with discharge of duties October 1, 1989 June 3, 2016 [Insert Federal Register citation] c(112) Criteria for identifying a conflict of interest. Section 1-85 Connecticut General Statutes Sulfur content of home heating oil and off road diesel fuel. Suspension of requirements for emergency July 8, 2013 June 3, 2016 [Insert Federal Register citation] c(112) Allowable sulfur content of fuels provided. Criteria for suspension of requirements identified. Section 16a-21a Connecticut General Statutes Duties of Commissioner of Energy and Environmental Protection. October 1, 1984 June 3, 2016 [Insert Federal Register citation] c(112) Obligations and activities of the Commissioner identified. Section 22a-171
    5. Add § 52.386 to read as follows:
    § 52.386 Section 110(a)(2) infrastructure requirements.

    The Connecticut Department of Energy and Environmental Protection submitted the following infrastructure SIPs on these dates: 2008 Pb NAAQS—October 13, 2011; 2008 ozone NAAQS—December 28, 2012; 2010 NO2 NAAQS—January 2, 2013; and 2010 SO2 NAAQS—May 30, 2013. These infrastructure SIPs are approved, with the exception of certain elements within 110(a)(2)(C)(ii), D(i)(II), and J(iii), which are conditionally approved. Connecticut submitted infrastructure SIPs for the 1997 and 2006 PM2.5 NAAQS on September 4, 2008, and September 18, 2009, respectively, and elements 110(a)(2)(A), D(ii), and E(ii), which were previously conditionally approved, are now approved. Also with respect to the 1997 and 2006 PM2.5 NAAQS, elements related to PSD, which include 110(a)(2)C(ii), D(i)(II), and J(iii) are newly conditionally approved. Connecticut also submitted an Infrastructure SIP for the 1997 8-hour ozone NAAQS on December 28, 2007, and element 110(a)(2)(D)(ii), which was previously conditionally approved, is now approved.

    [FR Doc. 2016-12375 Filed 6-2-16; 8:45 am] BILLING CODE 6560-50-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 271 [EPA-R09-RCRA-2015-0822; FRL-9947-28-Region 9] Nevada: Final Authorization of State Hazardous Waste Management Program Revisions AGENCY:

    Environmental Protection Agency (EPA).

    ACTION:

    Final rule.

    SUMMARY:

    EPA received several comments during the open comment period on the March 23, 2016, proposed rule to authorize Nevada's changes to the State Hazardous Waste Management program. EPA is responding to one comment opposing the action and reaffirming the effective date of the direct final rule as June 6, 2016.

    DATES:

    The final authorization is effective June 6, 2016.

    FOR FURTHER INFORMATION CONTACT:

    Laurie Amaro, U.S. Environmental Protection Agency Region 9, 75 Hawthorne Street LND-1-1, San Francisco, CA 94105, [email protected], 415-972-3364.

    SUPPLEMENTARY INFORMATION:

    A. What decisions has EPA made in this rule?

    On November 25, 2015, and December 28, 2015, Nevada submitted final complete program revision applications seeking authorization of changes to its hazardous waste program that correspond to certain federal rules promulgated between July 1, 2005, and June 30, 2008, (also known as RCRA Clusters XVI through XVIII). EPA concludes that Nevada's application to revise its authorized program meets all of the statutory and regulatory requirements established by RCRA, as set forth in RCRA section 3006(b), 42 U.S.C. 6926(b), and 40 CFR part 271. Therefore, EPA grants Nevada final authorization to operate as part of its hazardous waste program the changes listed in Section G of the direct final rule (81 FR 15440), as further described in the authorization application.

    Nevada has responsibility for permitting treatment, storage, and disposal facilities within its borders (except in Indian country) and for carrying out the aspects of the RCRA program described in its revised program application. New federal requirements and prohibitions imposed by federal regulations that EPA promulgates pursuant to the Hazardous and Solid Waste Amendments of 1984 take effect in authorized states at the same time that they take effect in unauthorized states. Thus, EPA will implement those requirements and prohibitions in Nevada, including the issuance of new permits implementing those requirements, until the State is granted authorization to do so.

    B. What is the effect of today's authorization decision?

    The effect of this decision is that the changes described in Nevada's authorization application will become part of the authorized state hazardous waste program and therefore will be federally enforceable. Nevada will continue to have primary enforcement authority and responsibility for its state hazardous waste program. EPA retains its authorities under RCRA sections 3007, 3008, 3013, and 7003, including its authority to:

    • Conduct inspections, and require monitoring, tests, analyses or reports;

    • Enforce RCRA requirements, including authorized state program requirements, and suspend or revoke permits; and

    • Take enforcement actions regardless of whether the state has taken its own actions.

    This action does not impose additional requirements on the regulated community because the regulations for which Nevada is being authorized by today's action are already effective and are not changed by today's action.

    C. What were the comments on EPA's proposal and what is EPA's response?

    On March 23, 2016, EPA published a proposed rule (81 FR 15497) and a direct final rule (81 FR 15440) to authorize Nevada's November 25 and December 28, 2015, applications to make revisions to Nevada's State Hazardous Waste Management program that correspond to certain federal rules promulgated between July 1, 2005, and June 30, 2008 (also known as RCRA Clusters XVI through XVIII). EPA stated that if adverse comments were received by May 9, 2016, the rule would be withdrawn and not take effect. On May 9, 2016, EPA received a comment opposing approval; however, due to the reasons explained below, EPA is not withdrawing the direct final rule but rather is responding to the comment and reaffirming the effective date of June 6, 2016, of the rule, pursuant to 40 CFR 271.21(b)(3)(iii)(B).

    EPA received four comments on the proposed rule, Nevada: Final Authorization of State Hazardous Waste Management Program Revisions. Three comments stated, “Good” and do not require a response. The fourth comment stated, “Instead of not authorizing Nevada's antifreeze recycling program (and in the process violate 271.1(h), the partial authorization prohibition) EPA should instead require the program to be amended so it is no less stringent than EPAs [sic] requirements. This has been wrong since 2009!”

    The State of Nevada adopted regulations for the “Recycling of Used Antifreeze” effective October 3, 1996, at NAC 444.8801-9071. These regulations are applicable to those categories of antifreeze that are recycled and have been determined to be hazardous waste because they either exhibit a characteristic of hazardous waste (i.e., the toxicity characteristic) or they are a listed hazardous waste in the state of their origin, for those categories of antifreeze entering Nevada from another State (NAC 444.8871). Under the Federal code, spent antifreeze destined to be recycled, as defined by Nevada, would be subject to the requirements of 40 CFR 261.6(b)-(d) “Requirements for Recyclable Materials.” In the Nevada regulations at NAC 444.8801-9071, spent antifreeze that is recycled is not regulated as universal waste, but is subject to requirements that are less stringent than the Federal regulations at 40 CFR 261.6(b)-(d). Accordingly, EPA cannot authorize Nevada's regulations specific to the recycling of used antifreeze.

    However, Nevada has incorporated the federal regulations contained in 40 CFR 261.6(b)-(d) at NAC 444.8632. The purpose of EPA's notice in the Federal Register is to direct generators and recyclers of used antifreeze to comply with 40 CFR 261.1(b)-(d) as incorporated by reference in NAC 444.8632, rather than the antifreeze-specific provisions at NAC 444.8801-9071. Because Nevada's authorized program regulates used antifreeze recycling at NAC 444.8632 in a program that is no less stringent than the federal requirements, there is no gap in coverage of used antifreeze recycling that could be considered a partial authorization, and EPA is not running afoul of the requirement contained in 40 CFR 271.1(h). Additionally, as noted in the guidance document, Clarification of EPA Policy on Authorizing Incomplete or Late “Clusters” Under 40 CFR 271.21 and Availability of Public Information under RCRA Section 3006(f), Nov. 6, 1992,

    There is regulatory history [relevant to 40 CFR 271.1(h)] which supports our interpretation that the prohibition on partial programs means States are prohibited from implementing RCRA programs that address only part of the universe of waste handlers, e.g., “generators”, “transporters”, “treatment, storage and disposal facilities”. This prohibition, therefore, would not be relevant to the great majority of program revisions, since any State program that has obtained initial authorization already addresses the full universe of waste handlers.

    The prohibition contained in 40 CFR 271.1(h) therefore does not apply to this authorization decision. Nevada obtained initial authorization of its hazardous waste management program on August 19, 1985, effective November 1, 1985 (50 FR 42181), and Nevada's federally authorized program covers the full universe of waste handlers. Accordingly, EPA affirms that the immediate final decision takes effect on June 6, 2016, as described in the direct final rule, Nevada: Final Authorization of State Hazardous Waste Management Program Revisions. D. Administrative Requirements

    The Office of Management and Budget (OMB) has exempted this action from the requirements of Executive Orders 12866 (58 FR 51735, October 4, 1993) and 13563 (76 FR 3821, January 21, 2011). Therefore this action is not subject to review by OMB. This action authorizes state requirements for the purpose of RCRA section 3006 and imposes no additional requirements beyond those imposed by state law. Accordingly, I certify that this action will not have a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.). Because this action authorizes pre-existing requirements under state law and does not impose any additional enforceable duty beyond that required by state law, it does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538). For the same reason, this action also does not significantly or uniquely affect the communities of tribal governments, as specified by Executive Order 13175 (65 FR 67249, November 9, 2000). This action will not have substantial direct effects on the states, on the relationship between the national government and the states, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132 (64 FR 43255, August 10, 1999), because it merely authorizes state requirements as part of the state RCRA hazardous waste program without altering the relationship or the distribution of power and responsibilities established by RCRA. This action also is not subject to Executive Order 13045 (62 FR 19885, April 23, 1997), because it is not economically significant and it does not make decisions based on environmental health or safety risks. This rule is not subject to Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355, May 22, 2001) because it is not a significant regulatory action under Executive Order 12866.

    Under RCRA section 3006(b), EPA grants a state's application for authorization as long as the state meets the criteria required by RCRA. It would thus be inconsistent with applicable law for EPA, when it reviews a state authorization application, to require the use of any particular voluntary consensus standard in place of another standard that otherwise satisfies the requirements of RCRA. Thus, the requirements of section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) do not apply. As required by section 3 of Executive Order 12988 (61 FR 4729, February 7, 1996), in issuing this rule, EPA has taken the necessary steps to eliminate drafting errors and ambiguity, minimize potential litigation, and provide a clear legal standard for affected conduct. EPA has complied with Executive Order 12630 (53 FR 8859, March 15, 1988) by examining the takings implications of the rule in accordance with the “Attorney General's Supplemental Guidelines for the Evaluation of Risk and Avoidance of Unanticipated Takings” issued under the executive order. This rule does not impose an information collection burden under the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.). “Burden” is defined at 5 CFR 1320.3(b). Executive Order 12898 (59 FR 7629, February 16, 1994) establishes federal executive policy on environmental justice. Its main provision directs federal agencies, to the greatest extent practicable and permitted by law, to make environmental justice part of their mission by identifying and addressing, as appropriate, disproportionately high and adverse human health or environmental effects of their programs, policies, and activities on minority populations and low-income populations in the United States. Because this rule authorizes pre-existing state rules which are at least equivalent to, and no less stringent than existing federal requirements, and imposes no additional requirements beyond those imposed by state law, and there are no anticipated significant adverse human health or environmental effects, the rule is not subject to Executive Order 12898.

    The Congressional Review Act, 5 U.S.C. 801-808, 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 document 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 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). However, this action is effective 75 days after the date of initial publication in the Federal Register.

    List of Subjects in 40 CFR Part 271

    Environmental protection, Administrative practice and procedure, Confidential business information, Hazardous waste, Hazardous waste transportation, Indian lands, Intergovernmental relations, Penalties, Reporting and recordkeeping requirements.

    Authority:

    This action is issued under the authority of sections 2002(a), 3006, and 7004(b) of the Solid Waste Disposal Act as amended, 42 U.S.C. 6912(a), 6926, and 6974(b).

    Dated: May 26, 2016. Alexis Strauss, Acting Regional Administrator, Region 9.
    [FR Doc. 2016-13161 Filed 6-2-16; 8:45 am] BILLING CODE 6560-50-P
    DEPARTMENT OF HEALTH AND HUMAN SERVICES Centers for Medicare & Medicaid Services 42 CFR Part 403 DEPARTMENT OF HEALTH AND HUMAN SERVICES 45 CFR Part 1331 RIN 0985-AA11 State Health Insurance Assistance Program (SHIP) AGENCY:

    Administration for Community Living (ACL), Department of Health and Human Services (HHS) and Centers for Medicare & Medicaid Services (CMS), HHS.

    ACTION:

    Final rule.

    SUMMARY:

    The Department of Health and Human Services is issuing a final regulation that adopts, without change, the interim final rule (IFR) entitled “State Health Insurance Assistance Program (SHIP).” This final rule implements a provision enacted by the Consolidated Appropriations Act of 2014 and reflects the transfer of the State Health Insurance Assistance Program (SHIP) from the Centers for Medicare & Medicaid Services (CMS), in the Department of Health and Human Services (HHS) to the Administration for Community Living (ACL) in HHS. Prior to the interim final rule, prior regulations were issued by CMS under the authority granted by the Omnibus Budget Reconciliation Act of 1990 (OBRA), Section 4360.

    DATES:

    Effective June 3, 2016.

    FOR FURTHER INFORMATION CONTACT:

    Josh Hodges, Administration for Community Living, telephone (202) 795-7364 (Voice). This is not a toll-free number. This document will be made available in alternative formats upon request. Written correspondence can be sent to Administration for Community Living, U.S. Department of Health and Human Services, 330 C St. SW., Washington, DC 20201.

    SUPPLEMENTARY INFORMATION:

    I. Background

    The State Health Insurance Assistance Program (SHIP) was created under Section 4360 of the Omnibus Budget Reconciliation Act (OBRA) of 1990 (Pub. L. 101-508). This section of the law authorized the Centers for Medicare & Medicaid Services (CMS) to make grants to States to establish and maintain health insurance advisory service programs for Medicare beneficiaries. Grant funds were made available to support information, counseling, and assistance activities relating to Medicare, Medicaid, and other related health insurance options such as: Medicare supplement insurance, long-term care insurance, managed care options, and other health insurance benefit information. In January 2014, in the Consolidated Appropriations Act of 2014, Congress transferred the funding for the SHIP program from CMS to the Administration for Community Living (ACL). This transfer reflects the existing formal and informal collaborations between the SHIP programs and the networks that ACL serves.

    On February 4, 2016, ACL and CMS issued an IFR (81 FR 5917) that transferred all provisions of the existing SHIP regulations at 42 CFR part 403 Subpart E, (§§ 403.500 through 403.512), to a new part at 45 CFR 1331.1-1331.7. The IFR also changed all references to CMS' administration of the program to ACL and made a technical change to reflect new Uniform Administrative Requirements, Cost Principles, and Audit Requirements for HHS Awards, codified at 45 CFR part 75. This final rule adopts, without making any changes, the regulatory requirements established in the IFR.

    II. Comments on the IFR

    HHS received one responsive comment to the IFR. The commenter expressed support for the rule and optimism for the new opportunities that come with the SHIP's transfer to ACL. We are grateful for the commenter's support and look forward to continuing to improve the program's effectiveness and efficiency.

    III. Regulatory Analysis A. Executive Order 12866

    This rule is not being treated as a “significant regulatory action” under section 3(f) of Executive Order 12866. Accordingly, the rule has not been reviewed by the Office of Management and Budget.

    B. Regulatory Flexibility Analysis

    The Secretary certifies under 5 U.S.C. 605(b), the Regulatory Flexibility Act (Pub. L. 96-354), that this regulation will not have a significant economic impact on a substantial number of small entities. The primary impact of this regulation is on entities applying for SHIP funding opportunities, specifically researchers, States, public or private agencies and organizations, institutions of higher education, and Indian tribes and Tribal organizations. The regulation does not have a significant economic impact on these entities.

    C. Paperwork Reduction Act of 1995

    In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. Ch. 3506; 5 CFR 1320 Appendix A.1) (PRA), ACL and CMS have determined that there are no new collections of information contained in this final rule.

    D. Waiver of Proposed Rulemaking

    Under the Administrative Procedure Act (APA), ACL and CMS are required to publish a notice of proposed rulemaking and provide the public with an opportunity to comment on proposed regulations prior to establishing a final rule unless it is determined for good cause that the notice and comment procedure is impracticable, unnecessary or contrary to public interest. 5 U.S.C. 553(b). As noted previously, Congress has already transferred the SHIP program to ACL under the Consolidated Appropriations Act of 2014. This final rule makes no changes other than aligning the location of the regulations within the Code of Federal Regulations with other ACL programs; amending the name of the administering agency to ACL; and updating a reference to new Uniform Administrative Requirements, Cost Principles, and Audit Requirements for HHS Awards, which have already undergone notice and comment rulemaking, therefore, there is good cause under 5 U.S.C. 553(b)(B) for waiving proposed rulemaking as unnecessary.

    E. Waiver of Delayed Effective Date

    Agencies are required to delay the effective date of their final regulations by 30 days after publication, as required under 5 U.S.C. 553(d), unless an exception under subsection (d) applies. Under 5 U.S.C. 553(d), ACL and CMS may waive the delayed effective date requirement if they find good cause and explain the basis for the waiver in the final rulemaking document or if the regulations grant or recognize an exemption or relieve a restriction.

    In the present case, there is good cause to waive the delayed effective date for this final rule, because the substance of the regulation, other than the name of the administering agency, is identical to the current regulation.

    F. Unfunded Mandates Reform Act

    Section 202 of the Unfunded Mandates Reform Act of 1995 requires that a covered agency prepare a budgetary impact statement before promulgating a rule that includes any Federal mandate that may result in expenditures by State, local, or Tribal governments, in the aggregate, or by the private sector, of $100 million, adjusted for inflation, or more in any one year. ACL and CMS have determined that this rule does not result in the expenditure by State, local, and Tribal government in the aggregate or by the private sector of more than $100 million in any one year.

    G. Congressional Review

    This rule is not a major rule as defined in 5 U.S.C. Section 804(2).

    H. Assessment of Federal Regulations and Policies on Families

    Section 654 of the Treasury and General Government Appropriations Act of 1999 requires Federal agencies to determine whether a policy or regulation may affect family wellbeing. If the agency's conclusion is affirmative, then the agency must prepare an impact assessment addressing seven criteria specified in the law. These regulations do not have an impact on family well-being as defined in the legislation.

    I. Executive Order 13132

    Executive Order 13132 on “federalism” was signed August 4, 1999. The purposes of the Order are: “. . . to guarantee the division of governmental responsibilities between the national government and the States that was intended by the Framers of the Constitution, to ensure that the principles of federalism established by the Framers guide the executive departments and agencies in the formulation and implementation of policies, and to further the policies of the Unfunded Mandates Reform Act . . .” Executive Order 13132 applies to actions with federalism implications, which are actions that have substantial direct effect on States, on the relationship between the Federal government and the States, or on the distribution of power and responsibilities among the various levels of government. For actions that have federalism implications and preempt state law or have federalism implications and impose substantial compliance costs on states and local governments, the agency must consult with state and local officials before publishing the rule and include a federalism statement in the preamble.

    The Department certifies that this rule does not have a substantial direct effect on States, on the relationship between the Federal government and the States, or on the distribution of power and responsibilities among the various levels of government.

    ACL and CMS are not aware of any specific state laws that would be preempted by the adoption of the regulation.

    List of Subjects 42 CFR Part 403

    Grant programs, Health insurance, Medicare, Reporting and recordkeeping requirements.

    45 CFR Part 1331

    Grant programs, health insurance, Medicare, reporting and recordkeeping requirements.

    Accordingly, the interim final rule amending 42 CFR part 403 and adding 45 CFR part 1331 that published on February 4, 2016 (81 FR 5917), is adopted as a final rule without change.

    Dated: April 29, 2016. Andrew M. Slavitt, Acting Administrator, Centers for Medicare & Medicaid Services. Dated: May 12, 2016. Kathy Greenlee, Administrator, Administration for Community Living. Approved: May 26, 2016. Sylvia M. Burwell, Secretary, U.S. Department of Health and Human Services.
    [FR Doc. 2016-13136 Filed 6-2-16; 8:45 am] BILLING CODE 4120-01-P
    DEPARTMENT OF HEALTH AND HUMAN SERVICES 45 CFR Parts 1385, 1386, 1387, and 1388 Administration for Community Living 45 CFR Parts 1321, 1322, 1323, 1324, 1325, 1326, 1327, and 1328 Administration for Community Living—Regulatory Consolidation AGENCY:

    Administration for Community Living (ACL), Department of Health and Human Services (HHS).

    ACTION:

    Final rule; technical amendments.

    SUMMARY:

    The Administration for Community Living (ACL) is amending its regulations to reflect the creation of ACL in 2012 and consolidate all of its regulations under a single subchapter. No substantive changes to the text of the regulations are being made by this rule.

    DATES:

    This final rule is effective on July 1, 2016.

    FOR FURTHER INFORMATION CONTACT:

    Greg Pugh, Administration for Community Living, telephone (202) 795-7422 (Voice). This is not a toll-free number. This document will be made available in alternative formats upon request. Written correspondence can be sent to Administration for Community Living, U.S. Department of Health and Human Services, 330 C St. SW., Washington, DC 20201.

    SUPPLEMENTARY INFORMATION:

    The Administration for Community Living (ACL) was created in 2012 by merging the HHS Administration on Aging (AoA), Administration on Intellectual and Developmental Disabilities (AIDD), and the Office of Disability (Statement of Organization Functions, and Delegations of Authority; Administration for Community Living, 77 FR 23250 (Apr. 28 2012)). This consolidation reflected these organizations' shared mission to maximize the independence, well-being, and health of older adults, people with disabilities across the lifespan, and their families and caregivers. Since the creation of ACL, a number of synergistic programs have been transferred under its purview, including the State Health Insurance Assistance Programs (SHIPs) from the Centers for Medicare and Medicaid Services (CMS) (Department of Health and Human Services Appropriations Act, 2014, Public Law 113-76 (Jan 17, 2014)) and the National Institute on Disability, Independent Living, and Rehabilitation Research (NIDILRR) and the Independent Living Administration from the Department of Education in 2014 (Workforce Investment and Opportunity Act of 2014, Public Law 113-128 (July 22, 2014)).

    Many of ACL's component programs and organizations had existing regulations prior to their transfer. ACL is consolidating these regulations in a single place to streamline administration and increase access and transparency. This rule renames the Administration on Aging's subchapter C of chapter XIII, subtitle B, title 45 from “The Administration on Aging, Older Americans Programs” to “The Administration for Community Living.” It then rearranges the existing AoA rules sequentially. This rule also transfers the existing AIDD rules from subchapter I to ACL's subchapter C. Conforming edits are made throughout in order to correct internal citations.

    Publication of this document constitutes final action on this change under the Administrative Procedures Act (5 U.S.C. 553). ACL has found that notice and public comment procedures are unnecessary because ACL is making a technical change merely updating the location and order of existing content.

    This Final Rule will be effective July 1, 2016, in order to allow the Long Term Care Ombudsman final rule, one of the sections being renumbered within ACL's subchapter, to take effect.

    Although this Final Rule contains no changes to programmatic or reporting requirements, we include the following table summarizing the changes made in order to simplify public understanding of the Final Rule:

    Previous part Previous heading New part New heading 45 CFR chapter XIII, subchapter C The Administration on Aging No change The Administration for Community Living. 45 CFR part 1321 Grants to State and Community Programs on Aging No change No change. 45 CFR part 1326 Grants to Indian Tribes for Support and Nutrition Services 1322 No change. 45 CFR part 1327 Allotments for Vulnerable Elder Rights Protection Activities 1324 No change. 45 CFR part 1328 Grants for Supportive and Nutritional Services for Older Hawaiian Natives 1323 No change. 45 CFR part 1385 Requirements Applicable to the Developmental Disabilities Program 1325 No change. 45 CFR part 1386 Formula Grant Programs 1326 Developmental Disabilities Formula Grant Programs. 45 CFR part 1387 Projects of National Significance 1327 Developmental Disabilities Projects of National Significance. 45 CFR part 1388 National Network of University Centers For Excellence In Developmental Disabilities Education, Research, and Service 1328 No change. List of Subjects in 45 CFR Parts 1321, 1322, 1323, 1324, 1325, 1326, 1327, 1328, 1385, 1386, 1387, and 1388

    Administrative practice and procedures, Aged, Colleges and universities, Disabled, Grant programs—education, Grant programs—Indians, Grant programs—social programs, Indians, Individuals with disabilities, Legal services, Long-term care, Nutrition, Research, Reporting and recordkeeping requirements.

    Dated: May 4, 2016. Kathy Greenlee, Administrator, Administration for Community Living. Dated: May 26, 2016. Sylvia M. Burwell Secretary, U.S. Department of Health and Human Services.

    For the reasons discussed in the preamble, under the authority at 5 U.S.C. 301, 42 U.S.C. 3001 et seq., and 42 U.S.C. 15001 et seq., the Department of Health and Human Services, the Administration for Community Living, and the Administration for Children and Families amend title 45, chapter XIII, subchapter C, and title 45, chapter XIII, subchapter I, respectively, as follows:

    Subchapter C—The Administration for Community Living 1. The heading for 45 CFR chapter XIII, subchapter C, is revised to read as set forth above. PARTS 1326, 1327, 1328, 1385, 1386, 1387, and 1388 [REDESIGNATED AS PARTS 1322, 1324, 1323, 1325, 1326, 1327, and 1328] 2. Parts 1326, 1327, 1328, 1385, 1386, 1387, and 1388 are redesignated as parts 1322, 1324, 1323, 1325, 1326, 1327, and 1328, respectively. PART 1321—GRANTS TO STATE AND COMMUNITY PROGRAMS ON AGING 3. The authority citation for part 1321 continues to read as follows: Authority:

    42 U.S.C. 3001 et seq.; title III of the Older Americans Act as amended.

    § 1321.11 [Amended]
    4. In § 1321.11, amend paragraph (b) by removing the reference “§ 1327.11(e)(3)” and adding in its place the reference “§ 1324.11(e)(3)”.
    PART 1322—GRANTS TO INDIAN TRIBES FOR SUPPORT AND NUTRITION SERVICES 5. The authority citation for newly redesignated part 1322 continues to read as follows: Authority:

    42 U.S.C. 3001; Title VI, Part A of the Older Americans Act.

    §§ 1322.3 and 1322.19 [Amended]
    6. In the table below, for each section and paragraph indicated in the first two columns, remove the reference indicated in the third column and add the reference indicated in the fourth column: Newly
  • redesignated
  • section
  • Paragraph(s) Remove Add
    § 1322.3 Definition of “Budgeting period” § 1326.19 of this part § 1322.19. § 1322.3 Definition of “Project period” § 1326.19 of this part § 1322.19. § 1322.3 Definition of “Service area” § 1326.9(b) § 1322.9(b). § 1322.3 Definition of “Tribal organization” § 1326.7 § 1322.7. § 1322.19 (d)(5) §§ 1326.7 through 1326.17 §§ 1322.7 through 1322.17.
    PART 1323—GRANTS FOR SUPPORTIVE AND NUTRITIONAL SERVICES FOR OLDER HAWAIIAN NATIVES 7. The authority citation for newly redesignated part 1323 continues to read as follows: Authority:

    42 U.S.C. 3001; Title VI Part B of the Older Americans Act.

    §§ 1323.3 and 1323.19 [Amended]
    8. In the table below, for each section and paragraph indicated in the first two columns, remove the reference indicated in the third column and add the reference indicated in the fourth column: Newly
  • redesignated
  • section
  • Paragraph(s) Remove Add
    § 1323.3 Definition of “Budgeting period” § 1328.19 of this part § 1323.19. § 1323.3 Definition of “Project period” § 1328.19 of this part § 1323.19. § 1323.3 Definition of “Service area” § 1328.9(b) § 1323.9(b). § 1323.19 (d)(5) §§ 1328.7 through 1328.17 §§ 1323.7 through 1323.17.
    PART 1324—ALLOTMENTS FOR VULNERABLE ELDER RIGHTS PROTECTION ACTIVITIES 9. The authority citation for newly redesignated part 1324 is revised to read as follows: Authority:

    42 U.S.C. 3001 et seq.

    §§ 1324.1, 1324.11, 1324.13, 1324.15, and 1324.19 [Amended]
    10. In the table below, for each section and paragraph indicated in the first two columns, remove the reference indicated in the third column and add the reference indicated in the fourth column: Newly
  • redesignated
  • section
  • Paragraph(s) Remove Add
    § 1324.1 Definition of “Representatives of the Office of the State Long-Term Care Ombudsman” § 1327.19(a) § 1324.19(a). § 1324.1 Definition of “State Long-Term Care Ombudsman, or Ombudsman” §§ 1327.13 and 1327.19 §§ 1324.13 and 1324.19. § 1324.1 Definition of “Willful interference” § 1327.13 § 1324.13. § 1324.1 Definition of “Willful interference” § 1327.19 § 1324.19. § 1324.11 (a) § 1327.13 § 1324.13. § 1324.11 (a) § 1327.19 § 1324.19. § 1324.11 (c) introductory text §§ 1327.13 and 1327.19 §§ 1324.13 and 1324.19. § 1324.11 (e)(1)(i) § 1327.13 § 1324.13. § 1324.11 (e)(2)(ii) and (iii) §§ 1327.13 and 1327.19 §§ 1324.13 and 1324.19. § 1324.11 (e)(3)(i) § 1327.13(e) § 1324.13(e). § 1324.11 (e)(3)(ii) introductory text § 1327.19(b)(5) through (8) § 1324.19(b)(5) through (8). § 1324.11 (e)(3)(iv) § 1327.19(b)(5) through (8) § 1324.19(b)(5) through (8). § 1324.11 (e)(4) introductory text and (e)(6)(i) § 1327.21 § 1324.21. § 1324.13 (b)(1) § 1327.11(e) § 1324.11(e). § 1324.13 (b)(2) § 1327.19 § 1324.19. § 1324.13 (c) introductory text § 1327.11(e)(6) § 1324.11(e)(6). § 1324.13 (c)(3) introductory text § 1327.19 § 1324.19. § 1324.15 (b) § 1327.11(e)(2) § 1324.11(e)(2). § 1324.15 (e) §§ 1327.13 and 1327.19 §§ 1324.13 and 1324.19. § 1324.15 (f) §§ 1327.11(e)(3) and 1327.13(e) §§ 1324.11(e)(3) and 1324.13(e). § 1324.15 (h) § 1327.13(h) § 1324.13(h). § 1324.15 (i)(1)(ii) §§ 1327.13 and 1327.19 §§ 1324.13 and 1324.19. § 1324.15 (k)(1) § 1327.13(g) § 1324.13(g). § 1324.15 (k)(4) § 1327.13(c)(2) § 1324.13(c)(2). § 1324.15 (k)(5) § 1327.13(h) § 1324.13(h). § 1324.19 (b)(3) introductory text, (b)(6) introductory text, (b)(7) introductory text, and (b)(8) introductory text § 1327.11(e)(3) § 1324.11(e)(3). § 1324.21 (d)(1) § 1327.11(e)(4) § 1324.11(e)(4). § 1324.21 (d)(1) § 1327.21(c) § 1324.21(c).
    PART 1325—REQUIREMENTS APPLICABLE TO THE DEVELOPMENTAL DISABILITIES PROGRAM 11. The authority citation for newly redesignated part 1325 continues to read as follows: Authority:

    42 U.S.C. 15001 et seq.

    §§ 1325.1, 1325.3, 1325.6, and 1325.9 [Amended]
    12. In the table below, for each section and paragraph indicated in the first two columns, remove the reference indicated in the third column and add the reference indicated in the fourth column: Newly
  • redesignated
  • section
  • Paragraph(s) Remove Add
    § 1325.1 Introductory text § 1385.4 § 1325.4. § 1325.3 Introductory text parts 1385 through 1388 parts 1325 through 1328. § 1325.3 Definition of “Required planning documents” § 1386.30 § 1326.30. § 1325.3 Definition of “Required planning documents” § 1386.22(c) § 1326.22(c). § 1325.3 Definition of “Required planning documents” § 1388.7 § 1328.7. § 1325.6 Last sentence of paragraph subpart E of 45 CFR part 1386 subpart E of 45 CFR part 1326. § 1325.9 (a) introductory text parts 1386 and 1388 parts 1326 and 1328.
    PART 1326—DEVELOPMENTAL DISABILITIES FORMULA GRANT PROGRAMS 13. The authority citation for newly redesignated part 1326 continues to read as follows: Authority:

    42 U.S.C. 15001 et seq.

    14. The part heading for newly redesignated part 1326 is revised to read as set forth above.
    §§ 1326.21, 1326.26, 1326.93, and 1326.94 [Amended]
    15. In the table below, for each section and paragraph indicated in the first two columns, remove the reference indicated in the third column and add the reference indicated in the fourth column: Newly
  • redesignated
  • section
  • Paragraph(s) Remove Add
    § 1326.21 (c) § 1386.23(c) § 1326.23(c). § 1326.26 First sentence of paragraph § 1386.25 § 1326.25. § 1326.93 (e) § 1386.90 § 1326.90. § 1326.94 (b)(2) introductory text § 1386.85(b) § 1326.85(b).
    PART 1327—DEVELOPMENTAL DISABILITIES PROJECTS OF NATIONAL SIGNIFICANCE 16. The authority citation for newly redesignated part 1327 continues to read as follows: Authority:

    42 U.S.C. 15001 et seq.

    17. The part heading for newly redesignated part 1327 is revised to read as set forth above. PART 1328—THE NATIONAL NETWORK OF UNIVERSITY CENTERS FOR EXCELLENCE IN DEVELOPMENTAL DISABILITIES, EDUCATION, RESEARCH, AND SERVICE 18. The authority citation for newly redesignated part 1328 continues to read as follows: Authority:

    42 U.S.C. 15001 et seq.

    §§ 1328.2, 1328.3, and 1328.5 [Amended]
    19. In the table below, for each section and paragraph indicated in the first two columns, remove the reference indicated in the third column and add the reference indicated in the fourth column: Newly
  • redesignated
  • section
  • Paragraph(s) Remove Add
    § 1328.2 (a)(2) § 1388.3 § 1328.3. § 1328.2 (a)(2) § 1385.3 § 1325.3. § 1328.2 (b) § 1388.4 § 1328.4. § 1328.3 Introductory text § 1388.2 § 1328.2. § 1328.5 (a) § 1388.2 § 1328.2. § 1328.5 (b)(1) § 1385.3 § 1325.3. § 1328.5 (c)(3) § 1388.2(a)(1) and (2) § 1328.2(a)(1) and (2).
    Subchapter I [Removed and Reserved] 20. 45 CFR chapter XIII, subchapter I, is removed and reserved.
    [FR Doc. 2016-13138 Filed 6-2-16; 8:45 am] BILLING CODE P
    DEPARTMENT OF HOMELAND SECURITY Coast Guard 46 CFR Part 10 [Docket No. USCG-2016-0029] Change-2 to Navigation and Vessel Inspection Circular 04-08: Medical Certification Standards, Medications, and Medical Review Process AGENCY:

    Coast Guard, DHS.

    ACTION:

    Notice of policy; availability.

    SUMMARY:

    The Coast Guard announces the availability of Change-2 to Navigation and Vessel Inspection Circular (NVIC) 04-08, “Medical and Physical Evaluation Guidelines for Merchant Mariner Credentials” (NVIC 04-08). Change-2 to NVIC 04-08 contains revisions to Enclosure (1) Medical Certification Standards, Enclosure (4) Medications, and Enclosure (6) Medical Review Process. The revisions to Enclosures (1) and (6) reflect process and procedural changes related to centralization of the evaluation of credential applications at the National Maritime Center and implementation of the final rule that aligned Coast Guard regulations with amendments to the International Convention on Standards of Training, Certification and Watchkeeping for Seafarers and made changes to national endorsements. The revisions to Enclosure (4) provide more detailed guidance on medications that are subject to further review, and address comments received in response to a notice published in the Federal Register on January 28, 2015 seeking input from the public on this issue.

    DATES:

    Change-2 to NVIC 04-08 is in effect on June 3, 2016.

    ADDRESSES:

    Submit comments online at http://www.regulations.gov in accordance with Web site instructions.

    FOR FURTHER INFORMATION CONTACT:

    If you have questions on this document, call or email LCDR Ian Bird, Office of Commercial Vessel Compliance (CG-CVC), 202-372-1255, email [email protected]

    SUPPLEMENTARY INFORMATION: Viewing Documents

    Navigation and Vessel Inspection Circular (NVIC) 04-08 is available on the Internet at: http://www.uscg.mil/hq/cg5/nvic/pdf/2008/NVIC%2004-08%20CH%201%20with%20Enclosures%2020130607.pdf. It can also be viewed on the Coast Guard's Web site at: www.uscg.mil/nmc.

    Background

    Coast Guard regulations contained in 46 CFR part 10, subpart C, contain the medical and physical standards that merchant mariner applicants must meet prior to being issued a merchant mariner medical certificate. NVIC 04-08 provides guidance to the regulated community on how to comply with the regulations pertaining to medical and physical qualifications for merchant mariners.

    On December 24, 2013, the Coast Guard published a final rule in the Federal Register (78 FR 77796) entitled “Implementation of the Amendments to the International Convention on Standards of Training, Certification and Watchkeeping for Seafarers, 1978, and Changes to National Endorsements.” It amended 46 CFR parts 1, 10, 11, 12, 13, and 15 to implement the International Convention on Standards of Training, Certification and Watchkeeping for Seafarers, 1978 (STCW Convention), including the 2010 amendments to the STCW Convention, and the Seafarers' Training, Certification and Watchkeeping Code, as well as updating requirements for national endorsements. The final rule also established the merchant mariner medical certificate as a document issued independently of the merchant mariner credential. Merchant mariner credentials issued after January 24, 2014, and that require a general medical examination are not valid for service unless accompanied by a valid medical certificate. Enclosures (1) and (6) of NVIC 04-08 required revision to reflect changes implemented with the final rule and a reorganization of the mariner credentialing function.

    Guidance on medication use contained in Enclosure (4) to NVIC 04-08 prior to Change-2 noted that use of certain medications was considered disqualifying for issuance of credentials. The guidance did not provide details on the types of medications that might lead to denial of a medical certificate, nor did it provide discussion of the information and criteria that the Coast Guard considers in determining whether to issue a waiver for certain medications.

    In developing this policy, the Coast Guard sought recommendations from the Merchant Mariner Medical Advisory Committee (MEDMAC) on waiver considerations for mariner applicants whose conditions require the use of potentially impairing medications while operating under the authority of the credential. In response to Coast Guard Task Statement 14-09, Medical Evaluation of Merchant Mariners Treated with Potentially Impairing Medications, MEDMAC recommended that medications with central nervous depressant effects, such as opioid, benzodiazepine, or non-benzodiazepine medications, be considered disqualifying and generally not waiverable. They also recommended that the following medications be determined disqualifying: medications that impair vision, anticoagulants, anti-metabolites and cancer treatments, sedating anti-histamines, antipsychotics, opioid-like analgesics, anti-seizure medications, and stimulant medications, such as amphetamine and methylphenidate. MEDMAC's recommendations did not include specific criteria for waiver consideration for mariners whose conditions require the use of potentially impairing medication while operating under the authority of the credential.

    On January 28, 2015, the Coast Guard published a notice in the Federal Register requesting public comments on a proposed revision to Enclosure (4) that would provide more in-depth guidance on these issues (80 FR 4582).

    We summarize the policy contained in Change-2 to NVIC 04-08 and address the public comments received on the proposed revision to Enclosure (4) below.

    Discussion

    Enclosure (1) and Enclosure (6). The revised Enclosure (1) Medical Certification Standards summarizes the medical and physical requirements for mariner endorsements and provides additional guidance regarding the medical certificate. The revision to Enclosure (6) provides guidance on the medical review process used to determine if a mariner meets the medical and physical standards for issuance of a medical certificate.

    Enclosure (4)—Medications. The revision to Enclosure (4) provides guidance to the regulated community on medications that may be deemed disqualifying for issuance of a medical certificate due to risks of impairment or other safety concerns. The new guidance also clarifies the extenuating circumstances related to the use of potentially impairing medications that the Coast Guard weighs in evaluating risks to public and maritime safety, and in determining suitability for a medical waiver. The revised enclosure additionally provides a safety warning to mariners advising them to refrain from operating under the authority of the credential when they are under the influence of any medication that can cause drowsiness, or impair cognitive ability, judgment, or reaction time. The revised guidance for mariners seeking a waiver to use potentially impairing medications while operating under the authority of the credential follows.

    I. Medication Waivers Requiring Special Consideration

    Medications that may impair cognitive ability, judgment or reaction time are considered disqualifying for issuance of credentials. The underlying condition, as well as the effects of the medications, may lead to denial of a medical certificate or may result in issuance of a waiver.

    Due to the documented risks of impaired cognition, judgment, and reaction time associated with the use of certain legally prescribed controlled substances; the Coast Guard has determined that use of these medications while acting under the authority of the credential generally will not be waived. These medications include, but are not limited to opioid/opiate medications, benzodiazepine medications, non-benzodiazepine sedative hypnotic medications, and barbiturate medications. However, waivers may be considered, on a case-by-case basis, if the Coast Guard determines that there are exceptional circumstances that warrant consideration for a waiver.

    Exceptional Circumstances. The criteria for waiver consideration for applicants seeking to use, or be under the influence of, medications that may impair their cognitive ability, judgment, or reaction time, while acting under the authority of the credential, are listed below. Applicants unable to meet all of the criteria are only considered for a waiver under extraordinary circumstances, if the Coast Guard deems the risk of impairment to be sufficiently low. The criteria follow.

    1. The mariner was previously granted a waiver allowing use of the same medication while working under the authority of the credential, where the credential was of the same scope of authority.

    2. The mariner demonstrated compliance with all terms of the prior waiver.

    3. There were no accidents or other safety concerns related to medication, judgment, cognitive ability, or reaction time during the course of the prior waiver period(s).

    4. The mariner has been on a stable medication regimen for a minimum of 2 years, as documented by the treating physician and pharmacy records.

    a. Mariners who have required periodic increases in medication dosing during the preceding 2-year period would not meet this criterion.

    b. Mariners who have consistently or periodically supplemented their medication regimen with other disqualifying medications during the 2-year period are not likely to be considered as meeting this criterion. For example, an individual who has been on a stable dose of one opioid pain medication for 2 years, but has also periodically taken or filled prescriptions for an opioid cough medication during that same time period, would not be considered as being on a stable dose of medicine.

    c. Mariners whose medication dose has been decreased or tapered off, without subsequent dose increase, may be considered as meeting this criterion.

    5. The mariner is not seeking to use, or be under the influence of, more than one medication with risk for impairment while working under the authority of the credential.

    6. The mariner's treating physician provides written assessment that adequately addresses all information requested in the section on Recommended Evaluation Data for Medication Waivers Requiring Special Consideration, and that supports a determination that the mariner is at low risk for medication impairment based upon objective testing and standard evaluation tools.

    7. When requested, formal neuropsychological/neurocognitive testing, performed as outlined in the section providing guidance on formal neuropsychological/neurocognitive evaluation, documents the absence of significant medication impairment.

    8. The mariner does not use any other medications or have any other medical conditions, which may alone, or in combination, adversely affect the mariner's fitness.

    9. Use of methadone may not be waived under any circumstances.

    The risk presented by the mariner's position may be considered in determining whether to grant a waiver. Because of the wide-range of operational conditions, it is impossible to set out in advance which positions may be suitable for a waiver. The Coast Guard retains final authority for the issuance of waivers. Waivers may include restrictions and/or operational limitations on the credential.

    Recommended Evaluation Data for Medication Waivers Requiring Special Consideration. Applicants seeking consideration for a medication waiver for the use of medications that may impair cognitive ability, judgment, or reaction time, while acting under the authority of the credential, should submit the additional information detailed below, for each medication.

    1. A letter from the prescribing and/or treating physician that includes the following:

    a. Whether the physician has familiarized himself/herself with the detailed guidelines on medical conditions and medications contained in NVIC 04-08.

    b. Whether the physician understands the safety-sensitive nature of the credential and the specialized shipboard environment.

    c. A detailed discussion of the condition that requires the use of the potentially impairing medication.

    d. A description of any known complications experienced by the mariner from the use of a particular medication, level of current stability, and prognosis of the underlying condition. The physician should also provide his or her professional opinion on whether the condition is suitable for safety-sensitive work.

    e. A description of the dosage and frequency of use of the medication (this description should be very specific; “as needed” is not sufficient information). The description should also reflect that the physician has reviewed the mariner's pharmacy records for documentation of the number of pills dispensed for use each month and documentation of the length of time that the mariner has been on the medication.

    f. A detailed statement about whether the mariner is taking the medication as directed, and if there are any concerns of misuse or overuse of the medication.

    g. A statement about whether the mariner is compliant with therapy and follow-up appointments.

    h. A statement about whether the mariner requires use of this medication while at work, or while aboard the vessel. If the mariner requires use of the potentially impairing medication while at work or while aboard the vessel, the physician should provide a detailed explanation and rationale for the use.

    i. A statement about whether the physician has advised the mariner of the risks of impairment related to the medication. The physician should also discuss any risks advised, as well as any instructions discussed with the mariner for mitigating risk.

    j. A statement about whether the mariner's other medications, medical conditions, and work/sleep conditions might compound the impairing effects of this medication. This discussion should reflect that the physician has knowledge of the specifics of the mariner's medications, medical conditions, and work/sleep schedule.

    k. A statement about whether the physician has formally evaluated the mariner for the presence of any impairing medication effects. This discussion should include a description of the method of evaluation utilized, as well as the findings.

    l. A medical opinion of whether the mariner has any medication effects that would impede safe operation of a vessel or interfere with work in a safety sensitive position. This discussion should include the rationale for the physician's opinion.

    m. A statement of whether the physician has advised the mariner that it is safe to operate a vessel, operate hazardous machinery, and perform safety sensitive functions while under the influence of this medication.

    2. When specifically requested by the reviewing authority, additional amplifying information, to include a formal neuropsychological/neurocognitive evaluation.

    a. In particular, mariners seeking waivers to use or be under the influence of potentially impairing opioid/opiate, benzodiazepine, sedative hypnotic, and/or barbiturate medications, while acting under the authority of the credential, may be asked to submit the results of a formal neuropsychological/neurocognitive evaluation.

    b. The Coast Guard will not normally request a neuropsychological/neurocognitive evaluation unless the applicant meets all other requirements for waiver consideration. This is to prevent mariners from undergoing costly testing when issuance of a waiver is unlikely.

    c. Mariners are advised that submission of neuropsychological/neurocognitive evaluation results does not guarantee issuance of a waiver.

    d. When a formal neuropsychological/neurocognitive evaluation is requested, the assessment should include objective assessment of the following functions, at a minimum:

    (1) Alertness, arousal, and vigilance;

    (2) Attention (focused, shifting, and divided), processing speed, and working memory;

    (3) Reaction time (choice and complex), psychomotor function, upper motor speed, and coordination;

    (4) Sensory perceptual function;

    (5) Executive function: mental flexibility, adaptive problem solving, abstract reasoning, impulse control, risk taking/risk assessment, organizational ability (including visual spatial organization), and planning;

    (6) Memory; and

    (7) Communication skills.

    e. When a formal neuropsychological/neurocognitive evaluation is requested, the evaluation and narrative interpretation must be provided by a neuropsychologist who is board-certified and licensed in the United States.

    f. The report of the formal neuropsychological/neurocognitive evaluation should also include:

    (1) Documentation of witnessed administration of the medication in question by a licensed medical provider; and

    (2) Documentation of the time interval between ingestion of the medication and administration of the neuropsychological/neurocognitive testing battery.

    II. Safety Warning for Mariners

    Certain medications, whether prescription or over-the-counter, have known impairing effects and their labels warn about the risk of drowsiness and caution against use while driving or operating hazardous machinery.

    The nature of shipboard life and shipboard operations is such that mariners may be subject to unexpected or emergency response duties associated with vessel or crew safety, and prevention of pollution and maritime security at any time while aboard a vessel.

    In the interest of safety of life and property at sea, the Coast Guard views shipboard life and the attendant shipboard duties that can arise without warning, as safety sensitive duties that are analogous to operating hazardous machinery. As such:

    1. Mariners are advised to discuss all medication use with their treating providers and to inform them of the safety sensitive nature of their credential; and

    2. Mariners are cautioned against acting under the authority of their credential while under the influence of medications that:

    a. Can cause drowsiness; or

    b. Can impair cognitive ability, judgment, or reaction time; or

    c. Can carry warnings that caution against driving or operating heavy machinery.

    3. Mariners are advised that they are considered to be acting under the authority of the credential anytime they are aboard a vessel in a situation to which 46 CFR 5.57(a) applies, even when off-watch or while asleep.

    Public Comments on the Proposed Revision to the Medication Policy, Enclosure (4) to NVIC 04-08

    The Coast Guard's notice sought general comments on whether the proposed revision to Enclosure (4) adequately addresses safety concerns regarding merchant mariners whose medical conditions require use of potentially impairing medication. The Coast Guard received 13 comment letters in response.

    The majority of commenters expressed general agreement with the proposed policy clarification, noting that it provides a case-by-case or individualized assessment of a mariner applicant's condition, instead of imposing a blanket denial for all mariner applicants who require the use of potentially impairing medications, while operating under the authority of the credential. The Coast Guard notes that even prior to Change-2, NVIC 04-08 provided for a case-by-case evaluation of each applicant's condition. The additional specificity of the guidance and criteria included in Change-2 will help provide a consistent framework for those evaluations.

    One commenter suggested that the guidance in the proposed policy be made enforceable by incorporating it into regulation. This same commenter also recommended that the guidance include a requirement for mariners to inform vessel owners/operators when they are under the influence of prescription or over-the-counter medications. The Coast Guard disagrees with both comments. First, the purpose of this proposed policy is not to regulate, but instead, to provide guidance to the regulated community on how the Coast Guard evaluates mariners who require the use of certain medications. The policy provides the framework for individualized assessment and allows flexibility for consideration of factors specific to each affected mariner. On the issue of requiring mariners to inform vessel owners/operators about their medications, the Coast Guard does not have any statutory authority to enact such a requirement.

    Two commenters disagreed with the policy clarification, arguing that it is overly restrictive in that it presumes that all mariners on the medications are impaired and does not give sufficient deference to the opinion of the treating physician. The Coast Guard notes that the policy is stringent, but holds that it strikes an adequate balance that includes strong consideration of the treating physician's opinion along with objective assessment for signs of impairment. Because of the safety sensitive nature of the medical certificate, the Coast Guard contends that neither mariner self-assessment, nor provider limited office-based assessment, is sufficient to rule out the risk of significant cognitive impairment in cases where the mariner seeks to use medications with known risk of impairment while operating under the authority of their credential. The Coast Guard notes that this opinion was also shared by all of the medical professionals who provided comment on the policy. They all agreed that the treating provider's office assessment would not be sufficient to ensure that a mariner applicant was free of impairing medication effects when using medications of this type.

    Three commenters opposed the proposed policy clarification, arguing that the Coast Guard should never issue waivers for mariners who require the use of potentially impairing medications, while operating under the authority of the credential, regardless of the circumstances. The Coast Guard acknowledges that individuals who use potentially impairing medications may suffer impairment, but finds that there is no evidence to support a conclusion that all individuals will uniformly suffer impairment. On this basis, the Coast Guard disagrees with imposing a new, blanket exclusion against all mariners who require the use of potentially impairing medication while operating under the authority of the credential. The merchant mariner medical regulations contained in 46 CFR part 10, subpart C, do not prohibit the use of legally prescribed medications, to include opioids, benzodiazepines, and non-benzodiazepine sedative hypnotics; and NVIC 04-08 has always provided for an individualized assessment of mariner applicants.

    The Coast Guard additionally emphasizes that the proposed policy clarification is not a change in policy; rather, it provides the regulated community with specificity and outlines the factors that the Coast Guard will consider during the individualized assessment of mariner applicants who require the use of potentially impairing medications, while operating under the authority of the credential. The individualized assessment considers whether the specifics of an applicant's medical condition, medical history, medication use, and cognitive functioning indicate a low likelihood of impairment, or indicate findings that suggest impairment. The Coast Guard contends that the policy clarification contained in Change-2 to NVIC 04-08 adequately strikes a balance between potential safety concerns and putting mariners out of work unnecessarily, and that individuals who meet all of the criteria outlined in this policy are at low enough risk to warrant consideration for a medical waiver. A blanket exclusion of mariner applicants who meet all of these criteria would likely put mariners out of work without sufficient cause.

    One commenter recommended that the Coast Guard provide stronger guidance for over-the-counter anti-motion sickness agents, noting that some of these agents are so sedating that they are sometimes used to induce sleep. The Coast Guard agrees and included a safety warning for use of anti-motion sickness agents that cause drowsiness or impairment.

    One commenter argued that the proposed policy clarification's requirement for mariners to report all over-the-counter medications taken is confusing and unnecessarily broad. The commenter noted that while the current medication guidance only requires reporting of over-the-counter medications that were taken for a period of 30 days or more, the proposed guidance suggests that mariners would be held accountable if they did not remember to report even a single dose of a vitamin or fiber tablet taken. The Coast Guard acknowledges that the proposed language on medication disclosure may cause unnecessary concern and confusion. The language in the proposed policy was revised, therefore, to retain the language from the current guidance document regarding the disclosure of over-the-counter medications. The revised language reads: mariner applicants need only report over-the-counter medications that were taken for a period of 30 days or more, within the 90 days prior to the date that the applicant signs the application to the Coast Guard.

    Regarding the use of neuropsychological/neurocognitive evaluation, two commenters asserted that the Coast Guard should require neuropsychological/neurocognitive evaluation for all mariners seeking to use potentially impairing medication, while operating under the authority of the credential. Another commenter agreed that such testing would be useful, but contended that such testing would be time and cost prohibitive. Two commenters opposed requiring neuropsychological/neurocognitive evaluations for all applicants in this category because they deemed it unnecessary and expensive. The Coast Guard agrees that while it might be ideal to review neuropsychological/neurocognitive evaluation results for all mariner applicants who seek to use potentially impairing medications when operating under the authority of the credential, such testing may not be necessary in all cases. Therefore, the Coast Guard has retained the wording from the proposed policy indicating that a neuropsychological/neurocognitive evaluation need only be provided when requested by the Coast Guard, as part of the individualized assessment.

    Another commenter argued that the Coast Guard would not be able to implement a process to request neuropsychological/neurocognitive evaluation on the basis that testing is time-consuming and expensive, and that there are no objective neurocognitive evaluation tools that are readily available to primary care providers. The Coast Guard agrees that neuropsychological/neurocognitive evaluation may be expensive and time consuming and that the associated evaluation tools are not readily available to primary care providers. However, we disagree with the assertion that their use is not warranted in certain situations. Such a situation may occur during the course of conducting an individualized assessment. Without information from a neuropsychological/neurocognitive evaluation, the evaluator is left to presume the presence or absence of medication impairment based upon limited information. To presume that an applicant is impaired by their medication and deny them medical certification when no impairment truly exists, may result in extraordinary costs for the mariner applicant, including loss of employment, with resultant loss of home and healthcare. Alternatively, to assume that no medication impairment exists when a mariner applicant is actually experiencing impairment, may result in unacceptably high costs to public and maritime safety, should a maritime casualty result. It is important to note that this section of the proposed policy describes the information that the Coast Guard will consider when determining whether extenuating circumstances exist that warrant consideration for a medical waiver for mariners seeking to use potentially impairing medications, while operating under the authority of the credential. As is often the case for any medical condition that is disqualifying and generally not approved for waiver, the evaluation to determine extenuating circumstances may often require assessment and testing that is beyond the scope of the primary care provider. When formal neuropsychological/neurocognitive evaluation is requested as part of the individualized assessment for use of impairing medications, while operating under the authority of the credential, the Coast Guard fully expects that this evaluation will be performed by a specialist trained to perform such evaluations. The Coast Guard also notes that while this testing may be time-consuming and expensive, a formal neuropsychological/neurocognitive evaluation can provide critical documentation on the presence or absence of impairing medication effects for those mariners seeking to use potentially impairing medication, while operating under the authority of the credential. When the Coast Guard determines that a formal neuropsychological/neurocognitive evaluation is needed, the results of the assessment will be considered in the context of the other extensive medical documentation provided to determine whether extenuating circumstances exist that warrant special consideration for a medical waiver. The decision of whether such testing is too time-consuming or too expensive will ultimately be left up to the individual mariner who seeks to demonstrate extenuating circumstances.

    On the question of which neuropsychological/neurocognitive functions should be measured, and the appropriate standard for test outcome, one commenter opined that such a determination would require further substantial research on individual job requirements. Another commenter recommended that the Coast Guard add memory and communication skills to the proposed list of neuropsychological/neurocognitive domains, to make the overall panel similar to that used by the Federal Aviation Administration. Another commenter recommended that a witness observe the mariner applicant taking the medication in question prior to the administration of the neuropsychological/neurocognitive evaluation. The Coast Guard considered all of these comments and noted that there are already well-established, validated testing measures for various domains of neuropsychological/neurocognitive functioning. Additionally, other modes of transportation have identified specific neuropsychological/neurocognitive domains that are critical for tasks such as flying an airplane or for driving a motor vehicle. The neuropsychological/neurocognitive functions identified for evaluation in the proposed policy reflect those functions recommended as critical for safe motor vehicle driving. In consideration of the public comments, the current policy has been revised to include testing of memory and communication skills as required elements of the neuropsychological/neurocognitive evaluation, when such testing is requested by the Coast Guard. The current policy also specifies that medication administration should be witnessed and documented by a provider prior to the conduct of neuropsychological/neurocognitive evaluation, when such testing is requested by the Coast Guard.

    Authority

    This document is issued under the authority of 5 U.S.C. 552(a), 46 U.S.C. 7101 et seq., 46 CFR part 10, subpart C, and Department of Homeland Security Delegation No. 0710.1.

    V.B. Gifford, Captain, U.S. Coast Guard, Director of Inspections & Compliance.
    [FR Doc. 2016-13158 Filed 6-2-16; 8:45 am] BILLING CODE 9110-04-P
    FEDERAL COMMUNICATIONS COMMISSION 47 CFR Part 73 [MB Docket No. 16-29; RM-11758; DA 16-543] Television Broadcasting Services; Scottsbluff, Nebraska and Sidney, Nebraska AGENCY:

    Federal Communications Commission.

    ACTION:

    Final rule.

    SUMMARY:

    At the request of Gray Television License, LLC, licensee of station KDUH-TV, Channel 7, Scottsbluff, Nebraska, and New Rushmore Radio, Inc., former licensee of KDUH-TV (collectively, Petitioners), the Commission has before it an unopposed Notice of Proposed Rulemaking seeking to amend the Post-Transition Table of DTV Allotments to delete channel 7 at Scottsbluff, Nebraska and to substitute channel 7 at Sidney, Nebraska. Petitioners further request modification of KDUH-TV's license to specify Sidney as the station's community of license. Petitioners assert that their proposal to reallot channel 7 to Sidney is based on the technical specifications currently authorized for KDUH-TV and, therefore, the new allotment will be mutually exclusive with the station's existing allotment. Petitioners further state that their proposal would meet the Commission's allotment priorities by providing Sidney with its first local television service. and that Scottsbluff would remain well-served after the proposed reallotment because full-power television station KSTF(TV), channel 29, would remain licensed to that community.

    DATES:

    Effective July 5, 2016.

    FOR FURTHER INFORMATION CONTACT:

    Adrienne Denysyk, [email protected], Media Bureau, (202) 418-2651.

    SUPPLEMENTARY INFORMATION:

    This is a synopsis of the Commission's Report and Order, MB Docket No. 16-29, adopted and released May 16, 2016. The full text of this document is available for public inspection and copying during normal business hours in the FCC's Reference Information Center at Portals II, CY-A257, 445 12th Street SW., Washington, DC, 20554. This document will also be available via ECFS (http://fjallfoss.fcc.gov/ecfs/). To request materials in accessible formats for people with disabilities (braille, large print, electronic files, audio format), send an email to [email protected] or call the Consumer & Governmental Affairs Bureau at 202-418-0530 (voice), 202-418-0432 (tty).

    This document does not contain information collection requirements subject to the Paperwork Reduction Act of 1995, Public Law 104-13. In addition, therefore, it does not contain any information collection burden “for small business concerns with fewer than 25 employees,” pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4). Provisions of the Regulatory Flexibility Act of 1980, see 5 U.S.C. 601-612, do not apply to this proceeding.

    The Commission will send a copy of this Report and Order in a report to be sent to Congress and the Government Accountability Office pursuant to the Congressional Review Act, see 5 U.S.C. 801(a)(1)(A).

    List of Subjects in 47 CFR Part 73

    Television.

    Federal Communications Commission. Thomas Horan, Chief of Staff, Media Bureau. Final Rule

    For the reasons discussed in the preamble, the Federal Communications Commission amends 47 CFR part 73 as follows:

    PART 73—RADIO BROADCAST SERVICES 1. The authority citation for part 73 continues to read as follows: Authority:

    47 U.S.C. 154, 303, 334, 336, and 339.

    § 73.622 [Amended]
    2. Amend § 73.622(i), the Post-Transition Table of DTV Allotments under Nebraska, by removing channel 7 at Scottsbluff and adding, in alphabetical order, Sidney, channel 7.
    [FR Doc. 2016-12603 Filed 6-2-16; 8:45 am] BILLING CODE 6712-01-P
    DEPARTMENT OF COMMERCE National Oceanic and Atmospheric Administration 50 CFR Part 660 [Docket No. 031125294-4091-02] RIN 0648-XE621 Fisheries Off West Coast States; the Highly Migratory Species Fishery; Closure AGENCY:

    National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.

    ACTION:

    Temporary rule; closure.

    SUMMARY:

    NMFS is prohibiting fishing with large-mesh drift gillnet (DGN) gear (>14 inches mesh) off the coast of southern California east of 120° W. meridian from June 1, 2016, through August 31, 2016. This prohibition is based on the Assistant Administrator for Fisheries' (AA's) determination that El Niño conditions are occurring off the coast of southern California. This action protects Endangered Species Act-listed loggerhead sea turtles (Caretta caretta), specifically the endangered North Pacific Ocean Distinct Population Segment.

    DATES:

    Effective 12:01 a.m. Pacific Daylight Time (PDT), June 1, 2016, through 11:59 p.m. PDT, August 31, 2016.

    FOR FURTHER INFORMATION CONTACT:

    Keith Shattenkirk, West Coast Region (WCR), NMFS, (562) 980-3248, [email protected]

    SUPPLEMENTARY INFORMATION:

    The DGN fishery is managed under the Fishery Management Plan for U.S. West Coast Fisheries for Highly Migratory Species (50 CFR part 660, subpart K) and occurs off the coast of California. NMFS regulations provide that no person may fish with, set, or haul back drift gillnet gear in U.S. waters of the Pacific Ocean east of the 120° W. meridian from June 1 through August 31 during a forecasted, or occurring, El Niño event off the coast of southern California (50 CFR 660.713(c)(2)). This area, which falls within the Southern California Bight (SCB), is referred to in the regulations as the “Pacific loggerhead conservation area.”

    Under 50 CFR 660.713(c)(2)(ii), the AA is to rely on information developed by NOAA offices (the Climate Prediction Center (CPC) and the West Coast Office of the Coast Watch program) to make the determination that an El Niño event is forecasted or occurring off southern California. The AA is to use monthly sea surface temperature (SST) charts to determine whether there are warmer-than-normal SSTs off southern California “during the months prior to the closure months for years in which an El Niño event has been declared” by the CPC. Specifically, the AA is to use SST data from the third and second months prior to the month of closure.

    NMFS published these regulations to protect loggerhead sea turtles, which are listed under the Endangered Species Act. The regulations addressed a reasonable and prudent alternative (RPA) included in NMFS' 2000 biological opinion on issuance of an incidental take permit under the Marine Mammal Protection Act. The biological opinion concluded that bycatch in the DGN fishery was likely to jeopardize the continued existence of loggerhead sea turtles and, as an RPA, recommended the fishery be closed during the summer months when El Niño conditions are present to avoid the likelihood of jeopardy.

    On March 5, 2015, the CPC issued an El Niño Advisory, declaring that El Niño conditions were present in equatorial waters. Since that initial advisory, all monthly CPC updates have stated that El Niño conditions remain in these waters. The May 12, 2016, update reaffirmed El Niño conditions are currently present.

    In May 2016, NMFS staff reviewed the SST anomalies in the SCB during March and April of 2016, relying on SST maps available through NOAA's Coast Watch program (for details see http://coastwatch.pfeg.noaa.gov/erddap/index.html). These maps indicated that SSTs were above normal in the SCB. NMFS concluded that a determination of El Niño conditions off southern California is warranted based on SSTs that are warmer than normal during the third and second months prior to the month of the closure, consistent with regulations at 50 CFR 660.713(c)(2)(ii).

    If SSTs return to normal or below normal during a closure period, regulations at 50 CFR 660.713(c)(2)(iii) state that the AA may re-open the fishery after publishing a Federal Register notice announcing that El Niño conditions are no longer present in the SCB.

    Classification

    This action is required by regulations at 50 CFR 660.713 and is exempt from Office of Management and Budget review under Executive Order 12866.

    NMFS finds good cause to waive the requirement to provide prior notice and opportunity for public comment pursuant to the authority set forth at 5 U.S.C. 553(b)(B) for the time-area closure of the DGN fishery. Notice and comment procedures are impracticable and contrary to the public interest. The most recent El Niño determination occurred on May 12, 2016, and regulations require that the closure period begin on June 1; therefore, there is insufficient time for notice and comment procedures. For the same reasons, NMFS also finds good cause under 5 U.S.C. 553(d)(3) to waive the general requirement for a 30-day delay in effectiveness for this action. This measure is based upon the best available information and is necessary for the conservation of loggerhead sea turtles. The closure period anticipated by the regulation ends, at the latest, on August 31, 2016. A delay in effectiveness may allow the fishery to interact with and injure or kill loggerhead sea turtles that may occur within the SCB during the time period in which the regulation was intended to protect loggerheads.

    Authority:

    16 U.S.C. 1801 et seq.

    Dated: May 27, 2016. Samuel D. Rauch III, Deputy Assistant Administrator for Regulatory Programs, National Marine Fisheries Service.
    [FR Doc. 2016-13137 Filed 5-31-16; 4:15 pm] BILLING CODE 3510-22-P
    81 107 Friday, June 3, 2016 Proposed Rules DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 29 [Docket No. FAA-2016-6940; Notice No. 29-039-SW-SC] Special Conditions: Bell Helicopter Textron, Inc. (BHTI), Model 525 Helicopters; Crew Alerting System (CAS) AGENCY:

    Federal Aviation Administration (FAA), DOT.

    ACTION:

    Notice of proposed special conditions.

    SUMMARY:

    We propose special conditions for the BHTI Model 525 helicopter. This helicopter will have a novel or unusual design feature associated with the electronic CAS. The applicable airworthiness regulations do not contain adequate or appropriate safety standards for this design feature. These proposed special conditions contain the additional safety standards that the Administrator considers necessary to establish a level of safety equivalent to that established by the existing airworthiness standards.

    DATES:

    Send your comments on or before July 18, 2016.

    ADDRESSES:

    Send comments identified by docket number FAA-2016-6940 using any of the following methods:

    Federal eRegulations Portal: Go to http://www.regulations.gov and follow the online instructions for sending your comments electronically.

    Mail: Send comments to Docket Operations, M-30, U.S. Department of Transportation (DOT), 1200 New Jersey Avenue SE., Room W12-140, West Building Ground Floor, Washington, DC, 20590-0001.

    Hand Delivery of Courier: Take comments to Docket Operations in Room W12-140 of the West Building Ground Floor at 1200 New Jersey Avenue, SE., Washington, DC, between 8 a.m., and 5 p.m., Monday through Friday, except Federal holidays.

    Fax: Fax comments to Docket Operations at 202-493-2251.

    Privacy: The FAA will post all comments it receives, without change, to http://www.regulations.gov, including any personal information the commenter provides. Using the search function of the docket Web site, anyone can find and read the electronic form of all comments received into any FAA docket, including the name of the individual sending the comment (or signing the comment for an association, business, labor union, etc.). DOT's complete Privacy Act Statement can be found in the Federal Register published on April 11, 2000 (65 FR 19477-19478), as well as at http://DocketsInfo.dot.gov.

    Docket: Background documents or comments received may be read at http://www.regulations.gov at any time. Follow the online instructions for accessing the docket or go to the Docket Operations in Room W12-140 of the West Building Ground Floor at 1200 New Jersey Avenue SE., Washington, DC, between 9 a.m., and 5 p.m., Monday through Friday, except Federal holidays.

    FOR FURTHER INFORMATION CONTACT:

    Martin R. Crane, Aviation Safety Engineer, Safety Management Group, Rotorcraft Directorate, FAA, 10101 Hillwood Pkwy, Fort Worth, TX 76177; telephone (817) 222-5110; email [email protected]

    SUPPLEMENTARY INFORMATION:

    Comments Invited

    We invite interested people to take part in this rulemaking by sending written comments, data, or views. The most helpful comments reference a specific portion of the special conditions, explain the reason for any recommended change, and include supporting data.

    We will consider all comments we receive on or before the closing date for comments. We will consider comments filed late if it is possible to do so without incurring expense or delay. We may change these special conditions based on the comments we receive.

    Background

    On December 15, 2011, BHTI applied for a type certificate for a new transport category helicopter designated as the Model 525. The aircraft is a medium twin-engine rotorcraft. The design maximum takeoff weight is 20,000 pounds, with a maximum capacity of 16 passengers and a crew of 2.

    BHTI proposes that the Model 525 use a novel and unusual design feature, which is an electronic CAS. Section 29.1322 of title 14, Code of Federal Regulations (14 CFR), prescribes discrete colored lights for warning, caution, and advisory alerts. In this regard, § 29.1322 lacks adequate airworthiness standards for alerting messages and displays that do not use discrete colored lights, that include non-visual cues, that provide alerting information to the flightcrew, and that use integrated and multiple alerts concurrently.

    The Model 525 CAS will have more effective integrated visual, aural, tactile, and alert messaging that will require special airworthiness standards, known as special conditions, to address crew alerting of failures or malfunctions in critical systems. These special conditions will add requirements from the airworthiness standards in § 25.1322 (Amendment 25-131) for advanced crew alerting systems in transport category aircraft.

    Type Certification Basis

    Under the provisions of 14 CFR 21.17, BHTI must show that the Model 525 meets the applicable provisions of part 29, as amended by Amendments 29-1 through 29-55 thereto. The BHTI Model 525 certification basis date is December 15, 2011, the date of application to the FAA.

    If the Administrator finds that the applicable airworthiness regulations (i.e., 14 CFR part 29) do not contain adequate or appropriate safety standards for the BHTI Model 525 because of a novel or unusual design feature, special conditions are prescribed under the provisions of § 21.16.

    Special conditions are initially applicable to the model for which they are issued. Should the type certificate for that model be amended later to include any other model that incorporates the same or similar novel or unusual design feature, the special conditions would also apply to the other model under § 21.101.

    The FAA issues special conditions, as defined in 14 CFR 11.19, in accordance with § 11.38, and they become part of the type-certification basis under § 21.17(a)(2).

    Novel or Unusual Design Features

    The BHTI Model 525 helicopter will incorporate the following novel or unusual design features: an advanced CAS system. The novel design includes the integration of audio and visual alerts, tactical sensors, and CAS message consolidation. The new technologies associated with integrated visual, aural, tactile, and alert messaging are more effective in alerting the flightcrew and aiding them in decision-making than the discrete colored lights for warning, caution, and advisory alerts prescribed in § 29.1322 alone.

    Discussion

    The current 14 CFR part 29 standards do not provide adequate standards for the advanced CAS system of the Bell Model 525 helicopter due to the complexity of the aircraft systems and the modes of the fly by wire primary flight controls. The proposed special condition will update definitions, define a prioritization scheme, expand color requirements, and address performance for flightcrew alerting to reflect changes in technology and functionality.

    Applicability

    As discussed above, these special conditions are applicable to the BHTI Model 525 helicopter. Should BHTI apply at a later date for a change to the type certificate to include another model incorporating the same novel or unusual design feature, the special conditions would apply to that model as well.

    Conclusion

    This action affects only certain novel or unusual design features on one model of helicopter. It is not a rule of general applicability.

    List of Subjects in 14 CFR Part 29

    Aircraft, Aviation safety, Reporting and recordkeeping requirements.

    The authority citation for these special conditions is as follows:

    Authority:

    49 U.S.C. 106(g), 40113, 44701, 44702, 44704.

    The Proposed Special Conditions

    Accordingly, the Federal Aviation Administration (FAA) proposes the following special conditions as part of the type certification basis for Bell Helicopter Textron, Inc., Model 525 helicopters.

    Flightcrew Alerting

    (a) Flightcrew alerts must:

    (1) Provide the flightcrew with the information needed to:

    (i) Identify non-normal operation or aircraft system conditions, and

    (ii) Determine the appropriate actions, if any.

    (2) Be readily and easily detectable and intelligible by the flightcrew under all foreseeable operating conditions, including conditions where multiple alerts are provided.

    (3) Be removed when the alerting condition no longer exists.

    (b) Alerts must conform to the following prioritization hierarchy based on the urgency of flightcrew awareness and response.

    (1) Warning: For conditions that require immediate flightcrew awareness and immediate flightcrew response.

    (2) Caution: For conditions that require immediate flightcrew awareness and subsequent flightcrew response.

    (3) Advisory: For conditions that require flightcrew awareness and may require subsequent flightcrew response.

    (c) Warning and caution alerts must:

    (1) Be prioritized within each category, when necessary.

    (2) Provide timely attention-getting cues through at least two different senses by a combination of aural, visual, or tactile indications.

    (3) Permit each occurrence of the attention-getting cues required by paragraph (c)(2) of these special conditions to be acknowledged and suppressed, unless they are required to be continuous.

    (d) The alert function must be designed to minimize the effects of false and nuisance alerts. In particular, it must be designed to:

    (1) Prevent the presentation of an alert that is inappropriate or unnecessary.

    (2) Provide a means to suppress an attention-getting component of an alert caused by a failure of the alerting function that interferes with the flightcrew's ability to safely operate the helicopter. This means must not be readily available to the flightcrew so that it could be operated inadvertently or by habitual reflexive action. When an alert is suppressed, there must be a clear and unmistakable annunciation to the flightcrew that the alert has been suppressed.

    (e) Visual alert indications must:

    (1) Conform to the following color convention:

    (i) Red for warning alert indications.

    (ii) Amber or yellow for caution alert indications.

    (iii) Any color except red, amber, yellow, or green for advisory alert indications.

    (2) Use visual coding techniques, together with other alerting function elements in the cockpit, to distinguish between warning, caution, and advisory alert indications, if they are presented on monochromatic displays that are not capable of conforming to the color convention in paragraph (e)(1) of these special conditions.

    (f) Use of the colors red, amber, and yellow in the cockpit for functions other than flightcrew alerting must be limited and must not adversely affect flightcrew alerting.

    Issued in Fort Worth, Texas, on May 24, 2016. Lance T. Gant Manager, Rotorcraft Directorate, Aircraft Certification Service.
    [FR Doc. 2016-13148 Filed 6-2-16; 8:45 am] BILLING CODE 4910-13-P
    DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2016-6672; Directorate Identifier 2016-NM-022-AD] RIN 2120-AA64 Airworthiness Directives; The Boeing Company Airplanes AGENCY:

    Federal Aviation Administration (FAA), DOT.

    ACTION:

    Notice of proposed rulemaking (NPRM).

    SUMMARY:

    We propose to adopt a new airworthiness directive (AD) for certain The Boeing Company Model 787-8 airplanes. This proposed AD was prompted by a report that the grounding jumper between the environmental control system (ECS) bracket and the current return network (CRN) strap near passenger 1 left and 1 right entry doors was not bonded correctly during manufacturing. This proposed AD would require changing the configuration of the grounding jumpers connecting the ECS brackets and CRN straps; measuring the bond resistance; and related investigative and corrective actions if necessary. We are proposing this AD to prevent an incorrectly bonded jumper between the ECS bracket and the CRN strap, which does not provide proper grounding to the door frames at door 1 left and 1 right. If a fault occurs, an electrical shock hazard can exist to passengers and flight crew and could result in personal or fatal injury.

    DATES:

    We must receive comments on this proposed AD by July 18, 2016.

    ADDRESSES:

    You may send comments, using the procedures found in 14 CFR 11.43 and 11.45, by any of the following methods:

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

    Fax: 202-493-2251.

    Mail: U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590.

    Hand Delivery: Deliver to Mail address above between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays.

    For service information identified in this NPRM, contact Boeing Commercial Airplanes, Attention: Data & Services Management, P.O. Box 3707, MC 2H-65, Seattle, WA 98124-2207; telephone 206-544-5000, extension 1; fax 206-766-5680; Internet https://www.myboeingfleet.com. You may view this referenced service information at the FAA, Transport Airplane Directorate, 1601 Lind Avenue SW., Renton, WA. For information on the availability of this material at the FAA, call 425-227-1221. It is also available on the internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2016-6672.

    Examining the AD Docket

    You may examine the AD docket on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2016-6672; or in person at the Docket Management Facility between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains this proposed AD, the regulatory evaluation, any comments received, and other information. The street address for the Docket Office (phone: 800-647-5527) is in the ADDRESSES section. Comments will be available in the AD docket shortly after receipt.

    FOR FURTHER INFORMATION CONTACT:

    Brendan Shanley, Aerospace Engineer, Systems and Equipment Branch, ANM-130S, FAA, Seattle Aircraft Certification Office (ACO), 1601 Lind Avenue SW., Renton, WA 98057-3356; phone: 425-917-6492; fax: 425-917-6590; email: [email protected].

    SUPPLEMENTARY INFORMATION: Comments Invited

    We invite you to send any written relevant data, views, or arguments about this proposal. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2016-6672; Directorate Identifier 2016-NM-022-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this proposed AD. We will consider all comments received by the closing date and may amend this proposed 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 proposed AD.

    Discussion

    We have received a report that the grounding jumper between the ECS bracket and the CRN strap near passenger1 left and 1 right entry doors was not bonded correctly during manufacturing. Engineering documentation did not include applying an electrical bond between the ECS bracket and CRN strap. The existing bond configuration does not ground the door frame structure in the event of an electrical equipment fault. This condition, if not corrected, could result in an electrical shock hazard to passengers and flight crew and could result in personal or fatal injury.

    Related Service Information Under 1 CFR Part 51

    We reviewed Boeing Service Bulletin B787-81205-SB530025-00, Issue 001, dated July 17, 2014. The service information describes procedures for changing the configuration of the grounding jumpers connecting the ECS brackets and CRN straps; measuring the bond resistance; and related investigative and corrective actions if necessary. This service information is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the ADDRESSES section.

    FAA's Determination

    We are proposing 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.

    Proposed AD Requirements

    This proposed AD would require accomplishing the actions specified in the service information described previously. For information on the procedures, see this service information at http://www.regulations.gov by searching for and locating Docket No. FAA-2016-6672.

    The phrase “related investigative actions” is used in this proposed AD. Related investigative actions are follow-on actions that (1) are related to the primary action, and (2) further investigate the nature of any condition found. Related investigative actions in an AD could include, for example, inspections.

    The phrase “corrective actions” is used in this proposed AD. Corrective actions correct or address any condition found. Corrective actions in an AD could include, for example, repairs.

    Costs of Compliance

    We estimate that this proposed AD affects 6 airplanes of U.S. registry. We estimate the following costs to comply with this proposed AD:

    Estimated Costs Action Labor cost Parts cost Cost per
  • product
  • Cost on
  • U.S. operators
  • Installation 6 work-hours × $85 per hour = $510 $100 $610 $3,660

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

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

    Authority for This Rulemaking

    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.

    Regulatory Findings

    We determined that this proposed AD would not have federalism implications under Executive Order 13132. This proposed AD would 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 this proposed regulation:

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

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

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

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

    List of Subjects in 14 CFR Part 39

    Air transportation, Aircraft, Aviation safety, Incorporation by reference, Safety.

    The Proposed Amendment

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

    PART 39—AIRWORTHINESS DIRECTIVES 1. The authority citation for part 39 continues to read as follows: Authority:

    49 U.S.C. 106(g), 40113, 44701.

    § 39.13 [Amended]
    2. The FAA amends § 39.13 by adding the following new airworthiness directive (AD): The Boeing Company: Docket No. FAA-2016-6672; Directorate Identifier 2016-NM-022-AD. (a) Comments Due Date

    We must receive comments by July 18, 2016.

    (b) Affected ADs

    None.

    (c) Applicability

    This AD applies to The Boeing Company Model 787-8 airplanes, certificated in any category, as identified in Boeing Service Bulletin B787-81205-SB530025-00, Issue 001, dated July 17, 2014.

    (d) Subject

    Air Transport Association (ATA) of America Code 53; Fuselage.

    (e) Unsafe Condition

    This AD was prompted by a report that the grounding jumper between the environmental control system (ECS) bracket and the current return network (CRN) strap near passenger 1 left and 1 right entry doors was not bonded correctly during manufacturing. We are issuing this AD to prevent an incorrectly bonded jumper between the ECS bracket and the CRN strap, which does not provide proper grounding to the door frames at door 1 left and 1 right. If a fault occurs, an electrical shock hazard can exist to passengers and flight crew and could result in personal or fatal injury.

    (f) Compliance

    Comply with this AD within the compliance times specified, unless already done.

    (g) Grounding Jumper Revision

    Within 12 months after the effective date of this AD: Change the configuration of the grounding jumpers connecting the ECS brackets and CRN straps, including measuring the bond resistance and doing all applicable related investigative and corrective actions, in accordance with the Accomplishment Instructions of Boeing Service Bulletin B787-81205-SB530025-00, Issue 001, dated July 17, 2014. Do all applicable related investigative and corrective actions before further flight.

    (h) Alternative Methods of Compliance (AMOCs)

    (1) The Manager, Seattle Aircraft Certification Office (ACO), FAA, has the authority to approve AMOCs for this AD, if requested using the procedures found in 14 CFR 39.19. In accordance with 14 CFR 39.19, send your request to your principal inspector or local Flight Standards District Office, as appropriate. If sending information directly to the manager of the ACO, send it to the attention of the person identified in paragraph (i)(1) of this AD. Information may be emailed to: [email protected].

    (2) Before using any approved AMOC, notify your appropriate principal inspector, or lacking a principal inspector, the manager of the local flight standards district office/certificate holding district office.

    (3) An AMOC that provides an acceptable level of safety may be used for any repair, modification, or alteration required by this AD if it is approved by the Boeing Commercial Airplanes Organization Designation Authorization (ODA) that has been authorized by the Manager, Seattle ACO, to make those findings. To be approved, the repair method, modification deviation, or alteration deviation must meet the certification basis of the airplane, and the approval must specifically refer to this AD.

    (i) Related Information

    (1) For more information about this AD, contact Brendan Shanley, Aerospace Engineer, Systems and Equipment Branch, ANM-130S, FAA, Seattle Aircraft Certification Office (ACO), 1601 Lind Avenue SW., Renton, WA 98057-3356; phone: 425-917-6492; fax: 425-917-6590; email: [email protected].

    (2) For service information identified in this AD, contact Boeing Commercial Airplanes, Attention: Data & Services Management, P.O. Box 3707, MC 2H-65, Seattle, WA 98124-2207; telephone 206-544-5000, extension 1; fax 206-766-5680; Internet https://www.myboeingfleet.com. You may view this referenced service information at the FAA, Transport Airplane Directorate, 1601 Lind Avenue SW., Renton, WA. For information on the availability of this material at the FAA, call 425-227-1221.

    Issued in Renton, Washington, on May 20, 2016. Victor Wicklund, Acting Manager, Transport Airplane Directorate, Aircraft Certification Service.
    [FR Doc. 2016-12849 Filed 6-2-16; 8:45 am] BILLING CODE 4910-13-P
    DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2016-6673; Directorate Identifier 2015-NM-092-AD] RIN 2120-AA64 Airworthiness Directives; Ameri-King Corporation Emergency Locator Transmitters AGENCY:

    Federal Aviation Administration (FAA), DOT.

    ACTION:

    Notice of proposed rulemaking (NPRM).

    SUMMARY:

    We propose to adopt a new airworthiness directive (AD) for certain Ameri-King Corporation emergency locator transmitters (ELTs) as installed on various aircraft. This proposed AD was prompted by multiple reports of ELT failure. This proposed AD was also prompted by a report of noncompliance to quality standards and manufacturer processes related to Ameri-King Corporation ELTs. Failure to adhere to these standards and processes could result in ELTs that do not function. This proposed AD would require repetitive inspections of the ELT for discrepancies; repetitive checks, tests, and verifications, as applicable, to ensure that the ELT is functioning; and corrective actions if necessary. This proposed AD also allows for optional replacement of affected ELTs and, for aircraft on which an ELT is not required by operating regulations, optional removal of affected ELTs. We are proposing this AD to detect and correct nonfunctioning ELTs, which could delay or impede the rescue of the flightcrew and passengers after an emergency landing.

    DATES:

    We must receive comments on this proposed AD by July 18, 2016.

    ADDRESSES:

    You may send comments, using the procedures found in 14 CFR 11.43 and 11.45, by any of the following methods:

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

    Fax: 202-493-2251.

    Mail: U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC 20590.

    Hand Delivery: Deliver to Mail address above between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays.

    For service information identified in this NPRM, contact Ameri-King Corporation, 17881 Sampson Lane, Huntington Beach, CA 92648; telephone: 714-842-8555; fax: 714-842-4235; Internet: http://ameri-king.com; email: [email protected] You may view this referenced service information at the FAA, Transport Airplane Directorate, 1601 Lind Avenue SW., Renton, WA. For information on the availability of this material at the FAA, call 425-227-1221.

    Examining the AD Docket

    You may examine the AD docket on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2016-6673; or in person at the Docket Management Facility between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The AD docket contains this proposed AD, the regulatory evaluation, any comments received, and other information. The street address for the Docket Office (phone: 800-647-5527) is in the ADDRESSES section. Comments will be available in the AD docket shortly after receipt.

    FOR FURTHER INFORMATION CONTACT:

    Gilbert Ceballos, Aerospace Engineer, Systems and Equipment Branch, ANM-130L, FAA, Los Angeles Aircraft Certification Office (ACO), 3960 Paramount Boulevard, Lakewood, CA 90712-4137; phone: 562-627-5372; fax: 562-627-5210; email: [email protected]

    SUPPLEMENTARY INFORMATION:

    Comments Invited

    We invite you to send any written relevant data, views, or arguments about this proposal. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2016-6673; Directorate Identifier 2015-NM-092-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this proposed AD. We will consider all comments received by the closing date and may amend this proposed 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 proposed AD.

    Discussion

    We received multiple reports of ELT failure (73 reported ELT failures). We also received a report of noncompliance to quality standards and manufacturer processes related to Ameri-King Corporation ELTs. Failure to adhere to these standards and processes could result in ELTs that do not function. ELT failure, if not corrected, could delay or impede the rescue of the flightcrew and passengers after an emergency landing.

    Emergency Cease and Desist Order Issued to Ameri-King Corporation

    We have determined that Ameri-King Corporation manufactured, sold, or distributed parts and articles that do not conform to an approved design but were represented as FAA-approved for installation on FAA type-certificated aircraft. Investigation of the production issues identified that Ameri-King Corporation violated multiple FAA regulations and falsified documents used to show compliance with FAA regulations. Therefore, we issued an emergency cease and desist order, dated December 28, 2015, to Ameri-King Corporation that terminates their technical standard order authorization (TSOA) and parts manufacturer approval (PMA).

    The FAA's emergency cease and desist order requires Ameri-King Corporation to immediately cease and desist manufacturing, selling, and distributing any articles for installation on FAA type-certificated aircraft, which would include advertising, repairing, rebuilding, and altering any articles intended for installation on type certificated products. Any parts and articles produced by Ameri-King Corporation before December 28, 2015, may not conform to an approved design. Any parts and articles produced by Ameri-King Corporation on or after that date were produced without an FAA production approval and contrary to the FAA's emergency cease and desist order.

    We might consider additional rulemaking to address other parts and articles that were produced by Ameri-King Corporation with falsified testing records and without complying with its FAA-mandated quality assurance procedures; such non-compliant parts and articles could result in an unacceptable hazard to aviation safety.

    Related Service Information Under 1 CFR Part 51

    We reviewed Ameri-King Corporation Document IM-450, “INSTALLATION & OPERATION MANUAL,” Revision A, dated October 18, 1995; and Ameri-King Corporation Document IM-451, “INSTALLATION AND OPERATION MANUAL,” Revision NC-4.1h, dated July 5, 2014. The service information describes procedures for inspections of the ELT for discrepancies; checks, tests, and verifications to ensure the ELT is functioning; and corrective actions. Corrective actions include replacing affected parts. This service information is reasonably available because the interested parties have access to it through their normal course of business or by the means identified in the ADDRESSES section.

    FAA's Determination

    We are proposing 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.

    Proposed AD Requirements

    This proposed AD would require accomplishing the actions specified in the service information described previously, except as discussed under “Differences Between this Proposed AD and the Service Information.”

    Differences Between This Proposed AD and the Service Information

    Ameri-King Corporation Document IM-450, “INSTALLATION & OPERATION MANUAL,” Revision A, dated October 18, 1995; and Ameri-King Corporation Document IM-451, “INSTALLATION AND OPERATION MANUAL,” Revision NC-4.1h, dated July 5, 2014; specify accomplishing certain inspections of the ELT but do not specify corrective actions for any finding of the following discrepancies: Unsecured fastener or mechanical assembly, cuts or abrasions on the coaxial cable outer jacket, corrosion on the “BNC” connectors and mating plug on the antenna and the ELT main unit, wear or abrasion on the modular cable outer jacket, corrosion on the jack and plug of the modular connecting cable, and corrosion on the battery compartment. This proposed AD would require repairing any discrepancy found during the inspections.

    Ameri-King Corporation Document IM-450, “INSTALLATION & OPERATION MANUAL,” Revision A, dated October 18, 1995, specifies doing a functional test, a verification that the G-switch is working, and an activation check, but does not specify corrective actions for any findings. If there are any findings during the test, verification, or check, this proposed AD would require replacing the affected ELT with another serviceable FAA-approved ELT.

    Ameri-King Corporation Document IM-451, “INSTALLATION AND OPERATION MANUAL,” Revision NC-4.1h, dated July 5, 2014, specifies doing an operational test, G-switch and antenna checks, a digital message verification, a registration verification, and verification of ELT and global positioning system (GPS) interface, but does not specify corrective actions for any findings. If there are any findings during the test, checks, or verifications, this proposed AD would require replacing the affected ELT with another serviceable FAA-approved ELT.

    Costs of Compliance

    We estimate that this proposed AD affects 14,500 ELTs installed on various aircraft of U.S. registry.

    We estimate the following costs to comply with this proposed AD:

    Estimated Costs Action Labor cost Cost per product Cost on U.S. operators Inspections, checks, tests, and verifications 2 work-hours × $85 per hour = $170 per inspection cycle $170 per inspection cycle $2,465,000 per inspection cycle.

    We estimate the following costs to do any necessary replacements that would be required based on the results of the proposed inspections, checks, tests, and verifications. We have no way of determining the number of aircraft that might need these replacements.

    On-Condition Costs Action Labor cost Parts cost Cost per product Replacement 4 work-hours × $85 per hour = $340 Between $600 and $1,500 Between $940 and $1,840. Authority for This Rulemaking

    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.

    Regulatory Findings

    We determined that this proposed AD would not have federalism implications under Executive Order 13132. This proposed AD would 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 this proposed regulation:

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

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

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

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

    List of Subjects in 14 CFR Part 39

    Air transportation, Aircraft, Aviation safety, Incorporation by reference, Safety.

    The Proposed Amendment

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

    PART 39—AIRWORTHINESS DIRECTIVES 1. The authority citation for part 39 continues to read as follows: Authority:

    49 U.S.C. 106(g), 40113, 44701.

    § 39.13 [Amended]
    2. The FAA amends § 39.13 by adding the following new airworthiness directive (AD): Ameri-King Corporation: Docket No. FAA-2016-6673; Directorate Identifier 2015-NM-092-AD. (a) Comments Due Date

    We must receive comments by July 18, 2016.

    (b) Affected ADs

    None.

    (c) Applicability

    This AD applies to Ameri-King Corporation Model AK-450-( ) and AK-451-( ) series emergency locator transmitters (ELTs). This appliance is installed on, but not limited to, aircraft identified in table 1 to paragraph (c) of this AD.

    Table 1 to Paragraph (c) of This AD—Certain Aircraft That Might Have Affected ELTs Installed Aircraft ELT model Airbus rotorcraft AK-451. American Champion Aircraft Corp. airplanes AK-450 and AK-451. Aviat Aircraft Inc. airplanes AK-450. Beechcraft Corporation airplanes AK-451. Bell Helicopter Textron Canada Limited rotorcraft AK-451. Bombardier Inc. airplanes AK-451. Cessna Aircraft Company airplanes AK-451. Cirrus Design Corporation airplanes AK-451. Diamond Aircraft Industries Inc. airplanes AK-450 and AK-451. Eclipse Aerospace Inc. airplanes AK-451. Embraer S.A. airplanes AK-451. KitFox Aircraft LLC (formerly SkyStar Aircraft Corporation and also Denney Aerocraft Company) airplanes AK-450. Luscombe Aircraft Corporation airplanes AK-450 and AK-451. Mooney Aircraft Corporation airplanes AK-450. Piper Aircraft Inc. airplanes AK-451. Robinson Helicopter Company rotorcraft AK-451. Sikorsky Aircraft Corporation rotorcraft AK-451. SOCATA, S.A., Socata Groupe Aerospatiale airplanes AK-450. Twin Commander Aircraft LLC airplanes AK-451. (d) Subject

    Joint Aircraft System Component (JASC)/Air Transport Association (ATA) of America Code 2562, Emergency Locator Beacon.

    (e) Unsafe Condition

    This AD was prompted by multiple reports of ELT failure. This AD was also prompted by a report of noncompliance to quality standards and manufacturer processes related to Ameri-King Corporation ELTs. Failure to adhere to these standards and processes could result in ELTs that do not function. We are issuing this AD to detect and correct nonfunctioning ELTs, which could delay or impede the rescue of the flightcrew and passengers after an emergency landing.

    (f) Compliance

    Comply with this AD within the compliance times specified, unless already done.

    (g) Repetitive Actions and Corrective Actions

    Within 12 months after the effective date of this AD, do general visual inspections of the ELT for discrepancies; checks, tests, and verifications, as applicable, to ensure the ELT is functioning; and all applicable corrective actions; in accordance with section 3.4, “Periodic Maintenance” of Ameri-King Corporation Document IM-450, “INSTALLATION & OPERATION MANUAL,” Revision A, dated October 18, 1995; or Ameri-King Corporation Document IM-451, “INSTALLATION AND OPERATION MANUAL,” Revision NC-4.1h, dated July 5, 2014; as applicable; except as required by paragraph (h) of this AD. Do all applicable corrective actions following 14 CFR 91.207(a), 14 CFR 91.207(f), and other applicable operating rules after accomplishing the inspections, checks, tests, and verifications. Repeat the inspections and applicable checks, tests, and verifications thereafter at intervals not to exceed 12 months until the terminating action specified in paragraph (j) of this AD is done.

    (h) Exceptions to Service Information

    (1) If, during any action required by paragraph (g) of this AD, any ELT fails the functional test specified in step 6., the verification specified in step 7., or the activation check specified in step 8., of section 3.4, “Periodic Maintenance,” of Ameri-King Corporation Document IM-450, “INSTALLATION & OPERATION MANUAL,” Revision A, dated October 18, 1995, replace the affected Model AK-450-( ) ELT with a serviceable FAA-approved ELT as specified in paragraph (i) of this AD (“Definition of Serviceable FAA-approved ELT”), following 14 CFR 91.207(a), 14 CFR 91.207(f), and other applicable operating rules.

    (2) If, during any action required by paragraph (g) of this AD, any ELT fails any of the actions specified in paragraphs (h)(2)(i) through (h)(2)(v) of this AD, replace the affected Model AK-451-( ) ELT with a serviceable FAA-approved ELT as specified in paragraph (i) of this AD (“Definition of Serviceable FAA-approved ELT”), following 14 CFR 91.207(a), 14 CFR 91.207(f), and other applicable operating rules.

    (i) The operational test specified in step 3.4.6 of section 3.4, “Periodic Maintenance,” of Ameri-King Corporation Document IM-451, “INSTALLATION AND OPERATION MANUAL,” Revision NC-4.1h, dated July 5, 2014.

    (ii) Any check specified in step 3.4.7 of section 3.4, “Periodic Maintenance,” of Ameri-King Corporation Document IM-451, “INSTALLATION AND OPERATION MANUAL,” Revision NC-4.1h, dated July 5, 2014.

    (iii) The digital message verification specified in step 3.4.8 of section 3.4, “Periodic Maintenance,” of Ameri-King Corporation Document IM-451, “INSTALLATION AND OPERATION MANUAL,” Revision NC-4.1h, dated July 5, 2014.

    (iv) The registration verification specified in step 3.4.9 of section 3.4, “Periodic Maintenance,” of Ameri-King Corporation Document IM-451, “INSTALLATION AND OPERATION MANUAL,” Revision NC-4.1h, dated July 5, 2014.

    (v) The verification of the ELT and global positioning system (GPS) interface specified in step 3.4.10 of section 3.4, “Periodic Maintenance,” of Ameri-King Corporation Document IM-451, “INSTALLATION AND OPERATION MANUAL,” Revision NC-4.1h, dated July 5, 2014.

    (3) If, during any action required by paragraph (g) of this AD, any of the discrepancies specified in paragraphs (h)(3)(i) through (h)(3)(vi) of this AD are found, repair all discrepancies following 14 CFR 91.207(a), 14 CFR 91.207(f), and other applicable operating rules.

    (i) Any unsecured fastener or mechanical assembly.

    (ii) Any cuts or abrasions on the coaxial cable outer jacket.

    (iii) Any corrosion on the “BNC” connectors and mating plug on the antenna and the ELT main unit.

    (iv) Any wear or abrasion on the modular cable outer jacket.

    (v) Any corrosion on the jack and plug of the modular connecting cable.

    (vi) Any corrosion on the battery compartment.

    (4) If, during any action required by paragraph (g) of this AD, any non-functioning battery is found, replace non-functioning batteries with non-rechargeable batteries identified in paragraph (h)(4)(i) or (h)(4)(ii) of this AD, as applicable, following 14 CFR 91.207(a), 14 CFR 91.207(f), and other applicable operating rules.

    (i) For AK-450 ELTs: For the remote cockpit switch, use a 3-volt lithium battery. For the ELT main unit, use four D cell (1.5 volt) alkaline batteries.

    (ii) For AK-451 ELTs: For the remote cockpit switch, use a 3-volt lithium battery. For the ELT main unit, use either four D cell lithium (LiMnO2) batteries or four D cell lithium (LiSO2) batteries.

    (i) Definition of Serviceable FAA-approved ELT

    For the purposes of this AD, a serviceable FAA-approved ELT is any FAA-approved ELT other than a Model AK-450-( ) and AK-451-( ) series ELT produced by Ameri-King Corporation.

    (j) Optional Terminating Action

    Doing the applicable action specified in paragraph (j)(1) or (j)(2) of this AD terminates the actions required by paragraphs (g) and (h) of this AD.

    (1) For aircraft required by operating regulations to be equipped with an ELT: Replace the ELT with a serviceable FAA-approved ELT as specified in paragraph (i) of this AD (“Definition of Serviceable FAA-approved ELT”).

    (2) For aircraft not required by operating regulations to be equipped with an ELT: Replace the ELT with a serviceable FAA-approved ELT as specified in paragraph (i) of this AD (“Definition of Serviceable FAA-approved ELT”). The ELT may be removed as an alternative to the ELT replacement; if an ELT is re-installed, it must be a serviceable ELT as specified in paragraph (i) of this AD (“Definition of Serviceable FAA-approved ELT”).

    (k) Alternative Methods of Compliance (AMOCs)

    (1) The Manager, Los Angeles Aircraft Certification Office, FAA, has the authority to approve AMOCs for this AD, if requested using the procedures found in 14 CFR 39.19. In accordance with 14 CFR 39.19, send your request to your principal inspector or local Flight Standards District Office, as appropriate. If sending information directly to the manager of the ACO, send it to the attention of the person identified in paragraph (l)(1) of this AD.

    (2) Before using any approved AMOC, notify your appropriate principal inspector, or lacking a principal inspector, the manager of the local flight standards district office/certificate holding district office.

    (l) Related Information

    (1) For more information about this AD, contact Gilbert Ceballos, Aerospace Engineer, Systems and Equipment Branch, ANM-130L, FAA, Los Angeles Aircraft Certification Office (ACO), 3960 Paramount Boulevard, Lakewood, California 90712-4137; phone: 562-627-5372; fax: 562-627-5210; email: [email protected].

    (2) For service information identified in this AD, contact Ameri-King Corporation, 17881 Sampson Lane, Huntington Beach, CA 92648; telephone: 714-842-8555; fax: 714-842-4235; Internet: http://ameri-king.com; email: [email protected]. You may view this referenced service information at the FAA, Transport Airplane Directorate, 1601 Lind Avenue SW., Renton, WA. For information on the availability of this material at the FAA, call 425-227-1221.

    Issued in Renton, Washington, on May 20, 2016. Victor Wicklund, Acting Manager, Transport Airplane Directorate, Aircraft Certification Service.
    [FR Doc. 2016-12852 Filed 6-2-16; 8:45 am] BILLING CODE 4910-13-P
    FEDERAL TRADE COMMISSION 16 CFR Part 460 Labeling and Advertising of Home Insulation AGENCY:

    Federal Trade Commission (“FTC” or “Commission”).

    ACTION:

    Advance notice of proposed rulemaking; extension of deadline for submission of public comments.

    SUMMARY:

    The FTC is extending the deadline for filing public comments on its recent Advance Notice of Proposed Rulemaking for the “Trade Regulation Rule Concerning the Labeling and Advertising of Home Insulation” (the “R-value Rule” or “Rule”).

    DATES:

    The comment period for the advance notice of proposed rulemaking published April 6, 2016 (81 FR 19936), is extended. Comments must be received on or before September 6, 2016.

    ADDRESSES:

    Interested parties may file a comment online or on paper, by following the instructions in the Request for Comment part of the SUPPLEMENTARY INFORMATION section below. Write “16 CFR part 460—R-value Rule Review, File No. R811001” on your comment, and file your comment online at https://ftcpublic.commentworks.com/ftc/rvaluerule, by following the instructions on the web-based form. If you prefer to file your comment on paper, mail your comment to the following address: Federal Trade Commission, Office of the Secretary, 600 Pennsylvania Avenue NW., Suite CC-5610 (Annex B), Washington, DC 20580, or deliver your comment to the following address: Federal Trade Commission, Office of the Secretary, Constitution Center, 400 7th St. SW., 5th Floor, Suite 5610 (Annex B), Washington, DC 20024.

    FOR FURTHER INFORMATION CONTACT:

    Hampton Newsome, (202) 326-2889, Attorney, Division of Enforcement, Bureau of Consumer Protection, Federal Trade Commission, 600 Pennsylvania Avenue NW., Washington, DC 20580.

    SUPPLEMENTARY INFORMATION:

    I. Comment Period Extension

    On April 6, 2016 (81 FR 19936), as part of the Commission's systematic review of its rules and guides, the FTC published an Advance Notice of Proposed Rulemaking (ANPR) in the Federal Register requesting public comments on the R-value Rule. The ANPR set June 6, 2016 as the deadline for filing comments. On May 12, 2016, the American Chemistry Council's (ACC) Center for the Polyurethanes Industry and Spray Foam Coalition requested a 90-day extension to the comment period. ACC represents manufacturers of various types of home insulation products, including spray polyurethane foam (SPF) and rigid polyurethane foam board insulation. The requesters explained that the insulation industry and certain insulation products have changed substantially since the Commission completed its last regulatory review in 2005. In particular, new industry research has become available on the short-term and long-term thermal performance of SPF products. ACC also noted that new research exists about the energy efficiency benefits of insulation products that combine air sealing with high thermal resistance properties. Accordingly, it asserted that additional time is necessary for companies and industry trade organizations to present this new information in a useful manner through comments.

    Given the complexity and range of issues raised in the ANPR, the Commission agrees that allowing additional time for filing comments would help facilitate the creation of a more complete record. Moreover, this extension would not harm consumers because the current Rule will remain in effect during the review process. The Commission agrees that extending the comment period to allow interested parties adequate time to address issues raised by the ANPR will facilitate a more complete record. Therefore, the Commission has decided to extend the comment period to September 6, 2016.

    II. Request for Comment

    You can file a comment online or on paper. For the Commission to consider your comment, we must receive it on or before September 6, 2016. Write “16 CFR part 460—R-value Rule Review, File No. R811001” on your comment. Your comment—including your name and your state—will be placed on the public record of this proceeding, including, to the extent practicable, on the public Commission Web site, at http://www.ftc.gov/os/publiccomments.shtm. As a matter of discretion, the Commission tries to remove individuals' home contact information from comments before placing them on the Commission Web site.

    Because your comment will be made public, you are solely responsible for making sure that your comment does not include any sensitive personal information, such as anyone's Social Security number, date of birth, driver's license number or other state identification number or foreign country equivalent, passport number, financial account number, or credit or debit card number. You are also solely responsible for making sure that your comment does not include any sensitive health information, such as medical records or other individually identifiable health information. In addition, do not include any “[t]rade secret or any commercial or financial information which is . . . privileged or confidential,” as discussed in section 6(f) of the FTC Act, 15 U.S.C. 46(f), and FTC Rule 4.10(a)(2), 16 CFR 4.10(a)(2). In particular, do not include competitively sensitive information such as costs, sales statistics, inventories, formulas, patterns, devices, manufacturing processes, or customer names.

    If you want the Commission to give your comment confidential treatment, you must file it in paper form, with a request for confidential treatment, and you must follow the procedure explained in FTC Rule 4.9(c), 16 CFR 4.9(c).1 Your comment will be kept confidential only if the FTC General Counsel grants your request in accordance with the law and the public interest.

    1 In particular, the written request for confidential treatment that accompanies the comment must include the factual and legal basis for the request, and must identify the specific portions of the comment to be withheld from the public record. See FTC Rule 4.9(c), 16 CFR 4.9(c).

    Postal mail addressed to the Commission is subject to delay due to heightened security screening. As a result, we encourage you to submit your comments online. To make sure that the Commission considers your online comment, you must file it at https://ftcpublic.commentworks.com/ftc/rvaluerule, by following the instruction on the web-based form. If this Notice appears at http://www.regulations.gov, you also may file a comment through that Web site.

    If you prefer to file your comment on paper, mail your comment to the following address: Federal Trade Commission, Office of the Secretary, 600 Pennsylvania Avenue NW., Suite CC-5610 (Annex B), Washington, DC 20580, or deliver your comment to the following address: Federal Trade Commission, Office of the Secretary, Constitution Center, 400 7th Street SW., 5th Floor, Suite 5610 (Annex B), Washington, DC 20024. If possible, submit your paper comment to the Commission by courier or overnight service.

    Visit the Commission Web site at http://www.ftc.gov to read this ANPR and the news release describing it. The FTC Act and other laws that the Commission administers permit the collection of public comments to consider and use in this proceeding, as appropriate. The Commission will consider all timely and responsive public comments that it receives on or before September 6, 2016. You can find more information, including routine uses permitted by the Privacy Act, in the Commission's privacy policy, at http://www.ftc.gov/ftc/privacy.htm.

    By direction of the Commission.

    Donald S. Clark, Secretary.
    [FR Doc. 2016-13097 Filed 6-2-16; 8:45 am] BILLING CODE 6750-01-P
    DELAWARE RIVER BASIN COMMISSION 18 CFR Parts 401 and 420 Rules of Practice and Procedure Concerning Regulatory Program Fees and Basin Regulations—Water Supply Charges Concerning Rates AGENCY:

    Delaware River Basin Commission.

    ACTION:

    Proposed rule; notice of public hearing.

    SUMMARY:

    The Commission is proposing amendments to the Rules of Practice and Procedure to adopt a new project review fee structure and to the Basin Regulations—Water Supply Charges to provide for automatic inflation adjustments. These changes also are proposed to be incorporated into the Commission's Comprehensive Plan.

    DATES:

    The Commission will hold a public hearing at 1 p.m. on Wednesday, July 27, 2016. The hearing will continue until all those wishing to testify have had an opportunity to do so. Written comments will be accepted and must be received by 5 p.m. on Friday, August 12, 2016.

    ADDRESSES:

    The public hearing will be held in the Goddard Conference Room at the Commission's office building located at 25 State Police Drive, West Trenton, NJ. As Internet mapping tools are inaccurate for this location, please use the driving directions posted on the Commission's Web site.

    Oral Testimony and Written Comments: Persons wishing to testify at the hearing are asked to register in advance by phoning Paula Schmitt at 609-883-9500, ext. 224. Written comments may be submitted as follows: If by email, to [email protected]; if by fax, to Commission Secretary at 609-883-9522; if by U.S. Mail, to Commission Secretary, DRBC, P.O. Box 7360, West Trenton, NJ 08628-0360; and if by overnight mail, to Commission Secretary, DRBC, 25 State Police Drive, West Trenton, NJ 08628-0360. Comments also may be delivered by hand at any time during the Commission's regular office hours (Monday through Friday, 8:30 a.m. through 5:00 p.m. except on national holidays) until the close of the comment period at 5:00 p.m. on Friday, August 12, 2016. In all cases, please include the commenter's name, address and affiliation, if any, in the comment document and “Fees Rulemaking” in the subject line.

    FOR FURTHER INFORMATION CONTACT:

    An FAQ document explaining this proposal in further detail is available on the Commission's Web site, www.drbc.net. For queries about the rulemaking process, please contact Pamela Bush at 609-477-7203.

    SUPPLEMENTARY INFORMATION:

    Background. The Delaware River Basin Commission (“DRBC” or “Commission”) is a Federal interstate compact agency charged with managing the water resources of the Delaware River Basin on a regional basis without regard to political boundaries. Its members are the governors of the four basin states—Delaware, New Jersey, New York and Pennsylvania—and the North Atlantic Division Commander of the U.S. Army Corps of Engineers, representing the federal government. DRBC is proposing a comprehensive revision of its project review fee structure, including an automatic annual indexed inflation adjustment for most fees. The inflation adjustment is also proposed for DRBC's water supply charges rates applicable to consumptive and non-consumptive surface water withdrawals.

    Current fees. DRBC's current project review fee structure was adopted by the Commission in 2009 by (uncodified) Resolution No. 2009-2. For projects involving total costs of $250,000 or less, it consists of a flat project review fee of $1,000 for privately sponsored projects and $500 for publically sponsored projects. For projects with total costs greater than $250,000, DRBC's current project review fee is based upon a percentage of the costs of the project attributable to project components physically located within the basin, and is capped at $75,000. However, projects for which the review is exceptionally involved may be charged DRBC's actual costs, which may exceed $75,000. The current fee structure generates an uneven revenue stream that between 2011 and 2015 produced average annual revenues of $610,843. The Commission's total cost associated with project reviews required by the Delaware River Basin Compact and DRBC regulations is estimated to equal $1.15 million annually. This estimate takes into consideration administrative cost savings expected to accompany implementation of the One Process/One Permit Program (also “One Process/One Permit”), recently authorized by the Commission through its adoption of the One Permit Program rule, 18 CFR 401.42.

    DRBC's water supply charges are used to pay debt service, annual operation and maintenance costs, and the costs of required improvements, repairs and replacements associated with water supply storage owned by the Commission in two reservoirs—Blue Marsh and Beltzville—located in Pennsylvania and operated by the U.S. Army Corps of Engineers. Water supply charges revenues also support DRBC activities related to water supply planning and operations. DRBC's current water supply charges rates, in effect since January 1, 2011, are $80 per million gallons for consumptive use and $.80 per million gallons for non-consumptive use. The previous rates, $60 per million gallons for consumptive use and $.60 per million gallons for non-consumptive use, were adopted in 1978 and remained unchanged for more than 30 years. DRBC's water supply charges revenues have lagged significantly behind inflation.

    Proposed Changes. The proposed project review fee restructuring includes: For wastewater discharge projects, elimination of DRBC project review fees for applications that undergo coordinated review pursuant to the One Process/One Permit Program; and for water withdrawal projects, (1) for those projects for which DRBC continues to act as lead review agency, replacement of the current fee structure with fees based on monthly water allocation limits; and (2) for renewals subject to coordinated review under One Process/One Permit, elimination of the project review fee. DRBC is simultaneously proposing an annual coordination, monitoring and assessment fee for all water withdrawal and wastewater discharge projects subject to DRBC review and approval, including projects that receive permits from a signatory party agency under the One Process/One Permit Program. The annual fee will range from $300 to $1,000 per year, depending upon the permitted discharge capacity or monthly water allocation. The fee for DRBC's review of “Other” projects—those that involve no ongoing withdrawals or discharges—will continue to be calculated on the basis of project cost. The coordination, monitoring and assessment fee will not apply to such “Other” projects. An annual, indexed, automatic inflation adjustment is proposed for most project review fees.

    The proposed regulatory program fees structure is expected to provide a more predictable and sustainable source of revenues and to help close the annual gap of approximately $539,000 in funding to support DRBC's project review program.

    No increase is proposed to DRBC's current water supply charges rates, set forth at 18 CFR 420.41. However, an annual, indexed, automatic inflation adjustment is proposed, applicable to both the consumptive and non-consumptive use rates for surface water withdrawals.

    Additional information. An FAQ document explaining DRBC's fee restructuring proposal in greater detail is available on the Commission's Web site, www.drbc.net.

    List of Subjects 18 CFR Part 401

    Administrative practice and procedure, Penalties, Water pollution control, Water resources.

    18 CFR Part 420

    Water Supply.

    For the reasons set forth in the preamble, the Delaware River Basin Commission proposes to amend parts 401 and 420 of title 18 of the Code of Federal Regulations as follows:

    PART 401—RULES OF PRACTICE AND PROCEDURE 1. The authority citation for part 401 continues to read as follows: Authority:

    Delaware River Basin Compact (75 Stat. 688), unless otherwise noted.

    2. Add § 401.43 to subpart C to read as follows:
    § 401.43 Regulatory program fees.

    (a) Purpose. The purpose of this section is to provide an adequate, stable and reliable stream of revenue to cover the cost of the Commission's regulatory program activities, an important means by which the Commission coordinates management of the shared water resources of the Basin. Activities to be covered by the fees include the review of applications for projects that are subject to review under the Delaware River Basin Compact and implementing regulations; and ongoing activities associated with such projects, including but not limited to, effluent and ambient monitoring, data analysis, hydrodynamic and water quality modeling, and coordination with state and federal agencies.

    (b) Types of fees. The following types of fees are established by this section:

    (1) Docket Application Fee. Except as set forth in paragraph (b)(1)(iii) of this section, the Docket Application Fee shall apply to:

    (i) Any project that, in accordance with the Delaware River Basin Compact and DRBC regulations, requires a Commission-issued docket or permit, whether it be a new or existing project for which the Commission has not yet issued an approval or a project for which the renewal of a previous Commission approval is required.

    (ii) Any project that in accordance with section 11 or section 13.1 of the Delaware River Basin Compact and DRBC regulations must be added to the Comprehensive Plan (also, “Plan”). In addition to any new project required to be included in the Plan, such projects include existing projects that in accordance with section 13.1 of the Compact are required to be included in the Plan and which were not previously added to the Plan. Any existing project that is changed substantially from the project as described in the Plan shall be deemed to be a new and different project for purposes of this section.

    (iii) Exemptions. The Docket Application Fee shall not apply to:

    (A) Any project for which the Signatory Party Agency serves as lead under the one permit program rule (§ 401.42), unless such project must be added by the Commission to the Comprehensive Plan.

    (B) Any project for which an agency, authority or commission of a signatory to the Compact is the primary sponsor. Projects sponsored by political subdivisions of the signatory states shall not be included in this exemption. For purposes of this section “political subdivisions” shall include without limitation municipalities, municipal utility authorities, municipal development corporations, and all other entities not directly under the budgetary and administrative control of the Commission's members.

    (2) Annual Monitoring and Coordination Fee. An Annual Monitoring and Coordination Fee shall apply to each withdrawal and/or discharge project for which a water allocation or wastewater discharge approval issued pursuant to the Compact and implementing regulations is in effect, regardless of whether the approval was issued by the Commission in the form of a docket, permit or other instrument, or by a Signatory Party Agency under the one permit program rule (§ 401.42). The fee shall be based on the amount of a project's approved monthly water allocation and/or approved daily discharge capacity.

    (3) Alternative Review Fee. In instances where the Commission's activities and related costs associated with the review of an existing or proposed project are expected to involve extraordinary time and expense, an Alternative Review Fee equal to the Commission's actual costs may be imposed. The Executive Director shall inform the project sponsor in writing when the Alternative Review Fee is to be applied and may require advance payment in the amount of the Commission's projected costs. Instances in which the Alternative Review Fee may apply include, but are not limited to, matters in which:

    (i) DRBC staff perform a detailed pre-application review, including but not limited to the performance or review of modeling and/or analysis to identify target limits for wastewater discharges;

    (ii) DRBC staff perform or review complex modeling in connection with the design of a wastewater discharge diffuser system;

    (iii) DRBC manages a public process for which the degree of public involvement results in extraordinary effort and expense, including but not limited to, costs associated with multiple stakeholder meetings, special public hearings, and/or voluminous public comment.

    (iv) DRBC conducts or is required to engage third parties to conduct additional analyses or evaluations of a project in response to a court order.

    (4) Additional fees—(i) Emergency approval. A request for an emergency certificate under § 401.40 to waive or amend a docket condition shall be subject to a minimum fee in accordance with paragraph (e) of this section. An Alternative Review Fee also may be charged in accordance with paragraph (b)(3) of this section.

    (ii) Late filed renewal application. Any renewal application submitted fewer than 120 calendar days in advance of the expiration date or after such other date specified in the docket or permit or letter of the Executive Director for filing a renewal application shall be subject to a Late Filed Renewal Application charge in excess of the otherwise applicable fee.

    (iii) Modification of a DRBC approval. Following Commission action on a project, each project revision or modification that the Executive Director deems substantial shall require an additional Docket Application Fee calculated in accordance with paragraph (e) of this section and subject to an Alternative Review Fee in accordance with paragraph (b)(3) of this section.

    (iv) Name change. Each project with a docket or permit issued by the DRBC or by a Signatory Party Agency pursuant to the one permit program rule (§ 401.42) will be charged an administrative fee as set forth in paragraph (e) of this section.

    (v) Change of ownership. Each project that undergoes a “change in ownership” as that term is defined at 18 CFR 420.31(e)(2) will be charged an administrative fee as set forth in paragraph (e) of this section.

    (c) Indexed adjustment. On July 1 of every year, beginning July 1, 2017, all fees established by this section will increase commensurate with any increase in the annual April 12-month Consumer Price Index (CPI) for Philadelphia, published by the U.S. Bureau of Labor Statistics during that year.1 In any year in which the April 12-month CPI for Philadelphia declines or shows no change, the Docket Application Fee and Annual Monitoring and Coordination Fee will remain unchanged. Following any indexed adjustment made under this paragraph, a revised fee schedule will be posted on the Commission's Web site. Interested parties may also obtain the current fee schedule by contacting the Commission directly during business hours.

    1 Consumer Price Index—U/Series ID: CWURA102SA0/Not Seasonally Adjusted/Area: Philadelphia-Wilmington-Atlantic City, PA-NJ-DE-MD/Item: All items/Base Period: 1982-84=100.

    (d) Late payment charge. When any fee established by this section remains unpaid 30 calendar days after the payment due date provided on the Commission's invoice, an incremental charge equal to 2% of the amount owed shall be automatically assessed. Such charge shall be assessed every 30 days thereafter until the total amount owed, including any late payment charges has been paid in full.

    (e) Fee schedules. The fees described in this section shall be as follows:

    Docket Application Filing Fee Project type Docket application fee Fee maximum $400 per million gallons/month of allocation,1 not to exceed $15,000. 1 Greater of: $15,000 1 or Alternative Review Fee Water Withdrawal Fee is doubled for any portion to be exported from the basin Wastewater Discharge Private projects: $1,000 1 Public projects: $500 1 Alternative Review Fee 0.4% of project cost up to $10,000,000 plus 0.12% of project cost above Greater of: $75,000 1 or Alternative Review Fee Other $10,000,000 (if applicable), not to exceed $75,000. 1 1 Subject to annual adjustment in accordance with paragraph (c) of this section. Annual Monitoring and Coordination Fee Annual fee Allocation 1$300 <4.99 mgm. 1450 5.00 to 49.99 mgm. Water Withdrawal 1650 50.00 to 499.99 mgm. 1825 500.00 to 9,999.99 mgm. 11,000; > or = to 10,000 mgm. Annual fee Discharge design capacity 1300 <0.05 mgd. Wastewater Discharge 1610 0.05 to 1 mgd. 1820 1 to 10 mgd. 11,000 >10 mgd. 1 Subject to annual adjustment in accordance with paragraph (c) of this section. Additional Fees Proposed action Fee Fee maximum Emergency Approval Under 18 CFR 401.40 $5,000 Alternative Review Fee. Late Filed Renewal Surcharge $2,000 At Executive Director's discretion, Docket Application Fee for the appropriate project type Alternative Review Fee. Modification of a DRBC Approval Name change $1,000, 1 Change of Ownership $1,500. 1 1 Subject to annual adjustment in accordance with paragraph (c) of this section.
    PART 420—BASIN REGULATIONS—WATER SUPPLY CHARGES 3. The authority citation for part 420 continues to read as follows: Authority:

    Delaware River Basin Compact, 75 Stat. 688.

    4. Revise § 420.41 to read as follows:
    § 420.41 Schedule of water charges.

    The schedule of water charges established in accordance with § 420.22 shall be as follows:

    (a) $80 per million gallons for consumptive use, subject to paragraph (c) of this section; and

    (b) $0.80 per million gallons for non-consumptive use, subject to paragraph (c) of this section.

    (c) On July 1 of every year, beginning July 1, 2017, the rates established by this section will increase commensurate with any increase in the annual April 12-month Consumer Price Index (CPI) for Philadelphia, published by the U.S. Bureau of Labor Statistics during that year.1 In any year in which the April 12-month CPI for Philadelphia declines or shows no change, the water charges rates will remain unchanged. Following any indexed adjustment made under this paragraph, revised consumptive and non-consumptive use rates will be posted on the Commission's Web site. Interested parties may also obtain the current rates by contacting the Commission directly during business hours.

    1 Consumer Price Index—U/Series ID: CWURA102SA0/Not Seasonally Adjusted/Area: Philadelphia-Wilmington-Atlantic City, PA-NJ-DE-MD/Item: All items/Base Period: 1982-84=100.

    Dated: May 26, 2016. Pamela M. Bush, Commission Secretary.
    [FR Doc. 2016-13012 Filed 6-2-16; 8:45 am] BILLING CODE 6360-01-P
    DEPARTMENT OF THE TREASURY Financial Crimes Enforcement Network 31 CFR Part 1010 RIN 1506-AB35 Imposition of Special Measure Against North Korea as a Jurisdiction of Primary Money Laundering Concern AGENCY:

    Financial Crimes Enforcement Network (“FinCEN”), Treasury.

    ACTION:

    Notice of proposed rulemaking.

    SUMMARY:

    In a finding, notice of which was published elsewhere in this issue of the Federal Register (“Notice of Finding”), the Director of FinCEN found that the Democratic People's Republic of Korea (“North Korea”) is a jurisdiction of primary money laundering concern. FinCEN is issuing this notice of proposed rulemaking (“NPRM”) to propose to prohibit covered financial institutions from opening or maintaining a correspondent account in the United States for or on behalf of a North Korean banking institution and to prohibit the use of foreign banking institutions' correspondent accounts at covered U.S. financial institutions to process transactions involving North Korean financial institutions.

    DATES:

    Written comments on the notice of proposed rulemaking must be submitted on or before August 2, 2016.

    ADDRESSES:

    You may submit comments, identified by 1506-AB35, by any of the following methods:

    Federal E-rulemaking Portal: http://www.regulations.gov. Follow the instructions for submitting comments. Include 1506-AB35 in the submission.

    Mail: The Financial Crimes Enforcement Network, P.O. Box 39, Vienna, VA 22183. Include RIN 1506-AB35 in the body of the text. Please submit comments by one method only.

    • Comments submitted in response to this NPRM will become a matter of public record. Therefore, you should submit only information that you wish to make publicly available.

    Inspection of comments: FinCEN uses the electronic, Internet-accessible dockets at Regulations.gov as its complete, official-record docket; all hard copies of materials that should be in the docket, including public comments, are electronically scanned and placed there. Federal Register notices published by FinCEN are searchable by docket number, RIN, or document title, among other things, and the docket number, RIN, and title may be found at the beginning of such notices. In general, FinCEN will make all comments publicly available by posting them on http://www.regulations.gov.

    FOR FURTHER INFORMATION CONTACT:

    The FinCEN Resource Center at (800) 949-2732.

    SUPPLEMENTARY INFORMATION:

    I. Statutory Provisions

    On October 26, 2001, the President signed into law the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, Public Law 107-56 (the “USA PATRIOT Act”). Title III of the USA PATRIOT Act amended the anti-money laundering provisions of the Bank Secrecy Act (“BSA”), codified at 12 U.S.C. 1829b, 12 U.S.C. 1951-1959, and 31 U.S.C. 5311-5314, 5316-5332, to promote the prevention, detection, and prosecution of international money laundering and the financing of terrorism. Regulations implementing the BSA appear at 31 CFR Chapter X. The authority of the Secretary of the Treasury (the “Secretary”) to administer the BSA and its implementing regulations has been delegated to the Director of FinCEN.1

    1 Therefore, references to the authority of the Secretary of the Treasury under Section 311 of the USA PATRIOT Act apply equally to the Director of FinCEN.

    Section 311 of the USA PATRIOT Act (“Section 311”), codified at 31 U.S.C. 5318A, grants the Director of FinCEN the authority, upon finding that reasonable grounds exist for concluding that a foreign jurisdiction, financial institution, class of transactions, or type of account is of “primary money laundering concern,” to require domestic financial institutions and financial agencies to take certain “special measures” to address the primary money laundering concern.

    II. Imposition of a Special Measure Against North Korea as a Jurisdiction of Primary Money Laundering Concern A. Proposed Imposition of Special Measure Five

    As noticed in the June 2, 2016 Federal Register, on May 27, 2016, the Director of FinCEN found that North Korea is a jurisdiction of primary money laundering concern (the “Finding”).2 Based upon that Finding, the Director of FinCEN is authorized to impose one or more special measures. Following the consideration of all factors relevant to the Finding and to selecting the special measure proposed in this NPRM, the Director of FinCEN proposes to impose the fifth special measure authorized by section 5318A(b)(5), (the “fifth special measure”). This special measure would prohibit covered financial institutions from opening or maintaining a correspondent account in the United States for or on behalf of a North Korean banking institution. Covered financial institutions would also be prohibited from processing a transaction involving a North Korean financial institution through the United States correspondent account of a foreign banking institution.

    2 Classified information used in support of a section 311 finding and special measure(s) may be submitted by FinCEN to a reviewing court ex parte and in camera. See section 376 of the Intelligence Authorization Act for fiscal year 2004, Public Law 108-177 (amending U.S.C. 5318A by adding new paragraph (f)).

    In addition, covered financial institutions would be required under the BSA to apply special due diligence to their foreign correspondent accounts that is reasonably designed to guard against their use to process transactions involving North Korean financial institutions. These proposed requirements are discussed in more detail below. In connection with this action, FinCEN consulted with the Federal Reserve, representatives of the Federal functional regulators, the Department of Justice, and the Department of State, among others.

    FinCEN requests comments on all aspects of its proposal to impose the fifth special measure, to include comments on the proposed prohibition on covered financial institutions from opening or maintaining a correspondent account in the United States for or on behalf of a North Korean banking institution.

    B. Discussion of Section 311 Factors

    In determining which special measures to implement to address the primary money laundering concern described in the associated Notice of Finding, FinCEN considered the following factors.

    1. Whether Similar Action Has Been or Will Be Taken by Other Nations or Multilateral Groups Against North Korea

    The international community has taken steps to address North Korean's illicit financial activity. Between 2006 and 2016 the United Nations Security Council has adopted multiple resolutions, 1718,3 1874,4 2087,5 2094,6 and 2270 7 which generally restrict North Korea's financial and operational activities related to its nuclear and missile programs and conventional arms sales. Most recently, in March 2016, the United Nations adopted United Nations Security Council Resolution (UNSCR) 2270, which imposes additional sanctions on North Korea in response to a January 6, 2016 nuclear test and February 7, 2016 launch using ballistic missile technology. This UNSCR contains provisions that generally require nations to: (i) Prohibit North Korean banks from opening branches in their territory or engaging in certain correspondent relationships with these banks; (ii) terminate existing representative offices or subsidiaries, branches, and correspondent accounts with North Korean financial institutions; (iii) prohibit their financial institutions from opening new representative offices or subsidiaries, branches, or bank accounts in North Korea; and (iv) to close existing representative offices or subsidiaries, branches, or bank accounts in North Korea if reasonable grounds exist to believe such financial services could contribute to North Korea's nuclear or missile programs, or UNSCR violations.

    3See United Nations Security Council Resolution (“UNSCR”) 1718 (http://www.un.org/en/ga/search/view_doc.asp?symbol=S/RES/1718(2006)).

    4See UNSCR 1874 (http://www.un.org/en/ga/search/view_doc.asp?symbol=S/RES/1874(2009).

    5See UNSCR 2087 (http://www.un.org/en/ga/search/view_doc.asp?symbol=S/RES/2087(2013)).

    6See UNSCR 2094 (http://www.un.org/en/ga/search/view_doc.asp?symbol=S/RES/2094(2013)).

    7See UNSCR 2270 (http://www.un.org/en/ga/search/view_doc.asp?symbol=S/RES/2270(2016)).

    The Financial Action Task Force (“FATF”) has issued a series of public statements expressing its concern that North Korea's lack of a comprehensive AML/CFT regime represents a significant vulnerability within the international financial system. The statements further called upon North Korea to address those deficiencies with urgency, and called upon FATF members and urged all jurisdictions to advise their financial institutions to give special attention to business relationships and transactions with North Korea, to protect their correspondent accounts from being used to evade countermeasures and risk mitigation practices. Starting in February 2011, the FATF called upon its members and urged all jurisdictions to apply effective counter-measures to protect their financial sectors from the money laundering and financing of terrorism risks emanating from North Korea.8

    8See “FATF Public Statement—19 February 2016,” Financial Action Task Force (http://www.fatf-gafi.org/publications/high-riskandnon-cooperativejurisdictions/documents/public-statement-february-2016.html).

    2. Whether the Imposition of the Fifth Special Measure Would Create a Significant Competitive Disadvantage, Including Any Undue Cost or Burden Associated With Compliance, for Financial Institutions Organized or Licensed in the United States

    The fifth special measure proposed by this rulemaking would, after the effective date of the final rule, prohibit covered financial institutions from opening or maintaining a correspondent account in the United States for or on behalf of a North Korean banking institution. It would also prohibit the use of a foreign banking institution's U.S. correspondent account to process a transaction involving a North Korean financial institution. As noted in FinCEN's Notice of Finding, none of North Korea's financial institutions currently maintain correspondent accounts directly with U.S. banks. Further, as noted above, U.S. financial institutions are currently subject to a range of prohibitions related to sanctions concerning North Korea, which has generally limited their direct exposure to the North Korean financial system. Therefore, FinCEN believes this action will not present an undue regulatory burden.

    Covered financial institutions would also potentially be required to apply special due diligence to their foreign correspondent accounts that is reasonably designed to guard against their use to process transactions involving North Korean financial institutions. For direct correspondent relationships, this would involve a minimal burden in transmitting a one-time notice to certain foreign correspondent account holders concerning the prohibition on processing transactions involving a North Korean financial institution through the U.S. correspondent account. U.S. financial institutions generally apply some level of screening and, when required, conduct some level of reporting of their transactions and accounts, often through the use of commercially available software such as that used for compliance with the economic sanctions programs administered by the Office of Foreign Assets Control (“OFAC”) of the Department of the Treasury and to detect potential suspicious activity. To ensure that U.S. financial institutions are not being used unwittingly to process payments for, or on behalf of, a North Korean financial institution, directly or indirectly, some marginal additional burden will be incurred by U.S. financial institutions to be vigilant in their suspicious activity monitoring procedures. As explained in more detail in the section-by-section analysis below, financial institutions should be able to leverage these current screening and reporting procedures to detect transactions involving a North Korean financial institution.

    3. The Extent to Which the Proposed Action or Timing of the Action Will Have a Significant Adverse Systemic Impact on the International Payment, Clearance, and Settlement System, or on Legitimate Business Activities of North Korea

    Financial institutions in North Korea are generally not major participants in the international payment system and are not relied upon by the international banking community for clearance or settlement services. In addition, given existing domestic and multilateral sanctions, coupled with the FATF calls for countermeasures to address North Korea's AML/CFT deficiencies, it is unlikely that the imposition of the fifth special measure against North Korea would have a significant adverse systemic impact on the international payment, clearance, and settlement system. In light of the reasons for imposing this special measure, and based on available information, FinCEN does not believe that it would impose an undue burden on legitimate business activities.

    4. The Effect of the Proposed Action on United States National Security and Foreign Policy

    The exclusion from the U.S. financial system of jurisdictions that serve as conduits for significant money laundering activity, for the financing of weapons of mass destruction or their delivery systems, and for other financial crimes enhances national security by making it more difficult for terrorists, proliferators, and money launderers to access the U.S. financial system. To the extent that this action serves as an additional tool in preventing North Korea from accessing the U.S. financial system, the proposed action would support and uphold U.S. national security and foreign policy goals. The imposition of the fifth special measure also would complement the U.S. Government's worldwide efforts to expose and disrupt international money laundering.

    Therefore, pursuant to the Finding that North Korea is a jurisdiction of primary money laundering concern, and after conducting the required consultations and weighing the relevant factors, the Director of FinCEN proposes to impose the fifth special measure.

    C. Consideration of Alternative Special Measures

    As noted above, and in FinCEN's Notice of Finding, North Korea is subject to numerous United Nations Security Council Resolutions 9 and U.S. sanctions authorities,10 and it has been consistently identified by the FATF for its AML deficiencies.11 The U.N. has specifically called for enhanced monitoring of financial transactions to prevent the financing of North Korea's nuclear and ballistic missile programs and the freezing of any assets suspected of supporting these illicit programs. Additionally, FinCEN has issued three advisories since 2005 detailing specific concerns of the deceptive financial practices used by North Korea and North Korean entities and calling on U.S. financial institutions to take appropriate risk mitigation measures. However, North Korea has not taken any substantial action to address the range of concerns and continues to be involved in an array of illicit activities, as reflected in the Notice of Finding.

    9See UNSCRs 1718, 1874, 2087, 2094, and 2270.

    10See, e.g., Executive Order (“E.O.”) 13382 “Blocking Property of Weapons of Mass Destruction Proliferators and Their Supporters” (2005) (https://www.federalregister.gov/articles/2005/07/01/05-13214/blocking-property-of-weapons-of-mass-destruction-proliferators-and-their-supporters); E.O. 13551 “Blocking Property of Certain Persons with Respect to North Korea” (2010) (https://www.thefederalregister.org/fdsys/pkg/FR-2010-09-01/pdf/X10-10901.pdf); E.O. 13687 “Imposing Additional Sanctions with Respect to North Korea” (2015) (https://www.federalregister.gov/articles/2015/01/06/2015-00058/imposing-additional-sanctions-with-respect-to-north-korea); E.O. 13722 “Blocking Property of the Government of North Korea and the Workers' Party of Korea, and Prohibiting Certain Transactions with Respect to North Korea,” (2016) (https://www.thefederalregister.org/fdsys/pkg/FR-2016-03-18/pdf/FR-2016-03-18.pdf).

    11See “FATF Public Statement—19 February 2016,” Financial Action Task Force (http://www.fatf-gafi.org/publications/high-riskandnon-cooperativejurisdictions/documents/public-statement-february-2016.html).

    The special measures enumerated under Section 311 are prophylactic safeguards that defend the U.S. financial system from money laundering and terrorist financing. FinCEN may impose a range of these special measures in order to protect the U.S. financial system from these threats. To that end, special measures one through four impose additional recordkeeping, information collection, and information reporting requirements on covered U.S. financial institutions. The fifth special measure establishes prohibitions or conditions on opening or maintaining certain correspondent or payable-through accounts. North Korea's complicity in money laundering and illicit financial activity, and flagrant disregard for multiple UN resolutions related to the proliferation of weapons of mass destruction, constitute a threat to the integrity of the U.S. financial system. Further, in light of existing sanctions on North Korea, FinCEN is concerned that any condition, additional recordkeeping, or reporting requirement would not be an effective measure to safeguard the U.S. financial system. In the case of the jurisdiction of North Korea, FinCEN views the fifth special measure, with its prohibitions on the opening or maintenance of a correspondent account for or on behalf of a North Korean banking institution, and on the use of a foreign correspondent account to process a transaction involving a North Korean financial institution, as the special measure that can adequately protect the U.S. financial system from North Korean illicit financial activity.

    III. Section-by-Section Analysis for Imposition of the Fifth Special Measure

    The proposed rule would prohibit covered financial institutions from opening or maintaining in the United States a correspondent account for or on behalf of a North Korean banking institution. It would also prohibit the use of a foreign banking institution's U.S. correspondent account to process a transaction involving a North Korean financial institution. As a corollary to this prohibition, covered financial institutions would be required to screen their correspondents in a manner that is reasonably designed to guard against use by foreign banking institutions to process transactions on behalf of a North Korean financial institution, including access through the use of indirect correspondent accounts held by those foreign institutions. A violation of the special measure could result in the imposition of civil monetary or criminal penalties.

    A. 1010.659(a)—Definitions 1. North Korean Financial Institution

    A North Korean financial institution would mean any branch, office, or subsidiary of any foreign financial institution, as defined at 31 CFR 1010.605(f), chartered or licensed by North Korea, including any branches, offices, or subsidiaries of such financial institution operating in any jurisdiction, and any branch or office within North Korea of any foreign financial institution.

    2. Foreign Banking Institution

    Foreign banking institution has the same meaning as provided in 31 CFR 1010.100(u).

    3. Correspondent Account

    Section 1010.659(a)(3) of the proposed rule would define the term “correspondent account” by reference to the definition contained in 31 CFR 1010.605(c)(1)(i). Section 1010.605(c)(1)(i) defines a correspondent account to mean an account established to receive deposits from, or make payments or other disbursements on behalf of, a foreign financial institution, or to handle other financial transactions related to the foreign financial institution. Under this definition, “payable through accounts” are a type of correspondent account.

    In the case of a U.S. depository institution, this broad definition includes most types of banking relationships between a U.S. depository institution and a foreign bank that are established to provide regular services, dealings, and other financial transactions, including a demand deposit, savings deposit, or other transaction or asset account, and a credit account or other extension of credit. FinCEN is using the same definition of “account” for purposes of this proposed rule as was established for depository institutions in the final rule implementing the provisions of section 312 of the USA PATRIOT Act requiring enhanced due diligence for correspondent accounts maintained for certain foreign banks.12

    12See 31 CFR 1010.605(c)(2)(i).

    In the case of securities broker-dealers, futures commission merchants, introducing brokers-commodities, and investment companies that are open-end companies (“mutual funds”), FinCEN is also using the same definition of “account” for purposes of this proposed rule as was established for these entities in the final rule implementing the provisions of section 312 of the USA PATRIOT Act requiring enhanced due diligence for correspondent accounts maintained for certain foreign banks.13

    13See 31 CFR 1010.605(c)(2)(ii)-(iv).

    4. Covered Financial Institution

    Section 1010.659(a)(4) of the proposed rule would define “covered financial institution” with the same definition used in the final rule implementing the provisions of section 312 of the USA PATRIOT Act,14 which in general includes the following:

    14See 31 CFR 1010.605(e)(1).

    • An insured bank (as defined in section 3(h) of the Federal Deposit Insurance Act (12 U.S.C. 1813(h);

    • a commercial bank;

    • an agency or branch of a foreign bank in the United States;

    • a Federally insured credit union;

    • a savings association;

    • a corporation acting under section 25A of the Federal Reserve Act (12 U.S.C. 611);

    • a trust bank or trust company;

    • a broker or dealer in securities;

    • a futures commission merchant or an introducing broker-commodities; and

    • a mutual fund.

    5. Subsidiary

    Section 1010.659(a)(5) of the proposed rule would define “subsidiary” as a company of which more than 50 percent of the voting stock or analogous equity interest is owned by another company.

    B. 1010.659(b)—Prohibition on Accounts and Due Diligence Requirements for Covered Financial Institutions 1. Prohibition on Opening or Maintaining Correspondent Accounts

    Section 1010.659(b)(1) and (2) of the proposed rule would prohibit covered financial institutions from establishing, maintaining, administering, or managing in the United States any correspondent account for or on behalf of a North Korean banking institution. It would also prohibit processing of a transaction involving a North Korean financial institution through the U.S. correspondent account of a foreign banking institution. These prohibitions would not supersede the blocking of property under any Executive order issued pursuant to the International Emergency Economic Powers Act (50 U.S.C. 1701 et seq.) (IEEPA) or 31 CFR Chapter V.

    2. Special Due Diligence for Correspondent Accounts To Prohibit Use

    As a corollary to the prohibitions set forth in section 1010.659(b)(1) and (2), section 1010.659(b)(3) of the proposed rule would require a covered financial institution to apply special due diligence to all of its foreign correspondent accounts that is reasonably designed to guard against processing transactions involving North Korean financial institutions. As part of that special due diligence, covered financial institutions must notify those foreign correspondent account holders that the covered financial institutions know or have reason to believe provide services to a North Korean financial institution that such correspondents may not provide a North Korean financial institution with access to the correspondent account maintained at the covered financial institution. A covered financial institution may satisfy this notification requirement using the following notice:

    Notice: Pursuant to U.S. regulations issued under Section 311 of the USA PATRIOT Act, see 31 CFR 1010.659, we are prohibited from establishing, maintaining, administering, or managing a correspondent account for, or on behalf of, a North Korean financial institution. The regulations also require us to notify you that you may not provide a North Korean financial institution, including any of its branches, offices, or subsidiaries, with access to the correspondent account you hold at our financial institution. If we become aware that the correspondent account you hold at our financial institution has processed any transactions involving a North Korean financial institution, including any of its branches, offices, or subsidiaries, we will be required to take appropriate steps to prevent such access, including terminating your account.

    Covered financial institutions should implement appropriate risk-based procedures to identify transactions involving a North Korean financial institution. A covered financial institution may, for example, have knowledge through transaction screening software that a correspondent processes transactions for a North Korean financial institution. The purpose of the notice requirement is to aid cooperation with correspondent account holders in preventing transactions involving a North Korean financial institution from accessing the U.S. financial system. FinCEN would not require or expect a covered financial institution to obtain a certification from any of its correspondent account holders that access will not be provided to comply with this notice requirement.

    Methods of compliance with the notice requirement could include, for example, transmitting a one-time notice by mail, fax, or email. The notice should be transmitted whenever a covered financial institution knows or has reason to believe that a foreign correspondent account holder provides services to a North Korean financial institution. FinCEN specifically solicits comments on the form and scope of the notice that would be required under the rule.

    The special due diligence would also include implementing risk-based procedures designed to identify any use of correspondent accounts to process transactions involving North Korean financial institutions. A covered financial institution would be expected to apply an appropriate screening mechanism to identify a funds transfer order that on its face listed a North Korean financial institution as the financial institution of the originator or beneficiary, or otherwise referenced a North Korean financial institution in a manner detectable under the financial institution's normal screening mechanisms. An appropriate screening mechanism could be the mechanisms used by a covered financial institution to comply with various legal requirements, such as the commercially available software programs used to comply with the economic sanctions programs administered by OFAC.

    A covered financial institution would also be required to implement risk-based procedures to identify indirect use of its correspondent accounts, including through methods used to disguise the originator or originating institution of a transaction. Specifically, FinCEN is concerned that a North Korean financial institution may attempt to disguise its transactions by relying on types of payments and accounts, including the use of front companies, which would not explicitly identify the North Korean institution as an involved party in the transaction. A financial institution may develop a suspicion of such misuse based on other information in its possession, patterns of transactions, or any other method available to it based on its existing systems. Under the proposed rule, a covered financial institution that suspects or has reason to suspect use of a correspondent account to process a transaction involving a North Korean financial institution must take all appropriate steps to attempt to verify and prevent such use, including a notification to its correspondent account holder requesting further information regarding a transaction, requesting corrective action to address the perceived risk and, where necessary, terminating the correspondent account. A covered financial institution may re-establish an account closed under the rule if it determines that the account will not be used to process transactions involving North Korean financial institutions. FinCEN specifically solicits comments on the requirement under the proposed rule that covered financial institutions take reasonable steps to prevent any processing of transactions involving North Korean financial institutions.

    3. Recordkeeping and Reporting

    Section 1010.659(b)(4) of the proposed rule would clarify that paragraph (b) of the rule does not impose any reporting requirement upon any covered financial institution that is not otherwise required by applicable law or regulation. A covered financial institution must, however, document its compliance with the notification requirement under section 1010.659(b)(3)(i)(A).

    IV. Request for Comments

    FinCEN invites comments on all aspects of the proposal to impose the fifth special measure against North Korea and specifically invites comments on the following matters:

    1. The finding that North Korea is a jurisdiction of primary money laundering concern;

    2. The form and scope of the notice to certain correspondent account holders that would be required under the rule;

    3. The appropriate scope of the proposed requirement for a covered financial institution to take reasonable steps to identify any use of its foreign correspondent accounts to process transactions involving North Korean financial institutions; and

    4. The appropriate steps a covered financial institution should take once it identifies use of one of its foreign correspondent accounts to process transactions involving a North Korean financial institution.

    V. Regulatory Flexibility Act

    When an agency issues a rulemaking proposal, the Regulatory Flexibility Act (“RFA”) requires the agency to “prepare and make available for public comment an initial regulatory flexibility analysis” that will “describe the impact of the proposed rule on small entities.” (5 U.S.C. 603(a)). Section 605 of the RFA allows an agency to certify a rule, in lieu of preparing an analysis, if the proposed rulemaking is not expected to have a significant economic impact on a substantial number of small entities.

    A. Proposal To Prohibit Covered Financial Institutions From Opening or Maintaining Correspondent Accounts With Certain Foreign Banks Under the Fifth Special Measure 1. Estimate of the Number of Small Entities to Whom the Proposed Fifth Special Measure Will Apply

    For purposes of the RFA, both banks and credit unions are considered small entities if they have less than $550,000,000 in assets.15 Of the estimated 6,192 banks, 80 percent have less than $550,000,000 in assets and are considered small entities.16 Of the estimated 6,021 credit unions, 92.5 percent have less than $550,000,000 in assets.17

    15Table of Small Business Size Standards Matched to North American Industry Classification System Codes, Small Business Administration Size Standards (SBA Feb. 26, 2016) [hereinafter “SBA Size Standards”]. (https://www.sba.gov/sites/default/files/files/Size_Standards_Table.pdf).

    16 Federal Deposit Insurance Corporation, Find an Institution, http://www2.fdic.gov/idasp/main.asp; select Size or Performance: Total Assets, type Equal or less than $: “550000” and select Find.

    17 National Credit Union Administration, Credit Union Data, http://webapps.ncua.gov/customquery/; select Search Fields: Total Assets, select Operator: Less than or equal to, type Field Values: “550000000” and select Go.

    Broker-dealers are defined in 31 CFR 1010.100(h) as those broker-dealers required to register with the Securities and Exchange Commission (SEC). For the purposes of the RFA, FinCEN relies on the SEC's definition of small business as previously submitted to the Small Business Administration (SBA). The SEC has defined the term small entity to mean a broker or dealer that: (1) Had total capital (net worth plus subordinated liabilities) of less than $500,000 on the date in the prior fiscal year as of which its audited financial statements, were prepared pursuant to Rule 17a-5(d) or, if not required to file such statements, a broker or dealer that had total capital (net worth plus subordinated debt) of less than $500,000 on the last business day of the preceding fiscal year (or in the time that it has been in business if shorter); and (2) is not affiliated with any person (other than a natural person) that is not a small business or small organization as defined in this release.18 Based on SEC estimates, 17 percent of broker-dealers are classified as small entities for purposes of the RFA.19

    18 17 CFR 240.0-10(c).

    19 76 FR 37572, 37602 (June 27, 2011) (the SEC estimates 871 small broker-dealers of the 5,063 total registered broker-dealers).

    Futures commission merchants (FCMs) are defined in 31 CFR 1010.100(x) as those FCMs that are registered or required to be registered as a FCM with the Commodity Futures Trading Commission (CFTC) under the Commodity Exchange Act (CEA), except persons who register pursuant to section 4f(a)(2) of the CEA, 7 U.S.C. 6f(a)(2). Because FinCEN and the CFTC regulate substantially the same population, for the purposes of the RFA, FinCEN relies on the CFTC's definition of small business as previously submitted to the SBA. In the CFTC's “Policy Statement and Establishment of Definitions of `Small Entities' for Purposes of the Regulatory Flexibility Act,” the CFTC concluded that registered FCMs should not be considered to be small entities for purposes of the RFA.20 The CFTC's determination in this regard was based, in part, upon the obligation of registered FCMs to meet the capital requirements established by the CFTC.

    20 47 FR 18618, 18619 (Apr. 30, 1982).

    For purposes of the RFA, an introducing broker-commodities dealer is considered small if it has less than $35,500,000 in gross receipts annually.21 Based on information provided by the National Futures Association (NFA), 95 percent of introducing brokers-commodities dealers have less than $35.5 million in adjusted net capital and are considered to be small entities.

    21 SBA Size Standards at 28.

    Mutual funds are defined in 31 CFR 1010.100(gg) as those investment companies that are open-end investment companies that are registered or are required to register with the SEC. For the purposes of the RFA, FinCEN relies on the SEC's definition of small business as previously submitted to the SBA. The SEC has defined the term “small entity” under the Investment Company Act to mean “an investment company that, together with other investment companies in the same group of related investment companies, has net assets of $50 million or less as of the end of its most recent fiscal year.” 22 Based on SEC estimates, seven percent of mutual funds are classified as “small entities” for purposes of the RFA under this definition.23

    22 17 CFR 270.0-10.

    23 78 FR 23637, 23658 (April 19, 2013).

    As noted above, 80 percent of banks, 92.5 percent of credit unions, 17 percent of broker-dealers, 95 percent of introducing broker-commodities dealers, no FCMs, and seven percent of mutual funds are small entities.

    2. Description of the Projected Reporting and Recordkeeping Requirements of the Fifth Special Measure

    The proposed fifth special measure would require covered financial institutions to provide a notification intended to aid cooperation from foreign correspondent account holders in preventing transactions involving North Korean financial institutions from being processed by the U.S. financial system. FinCEN estimates that the burden on institutions providing this notice is one hour. Covered financial institutions would also be required to take reasonable measures to detect use of their correspondent accounts to process transactions involving North Korean financial institutions.

    All U.S. persons, including U.S. financial institutions, currently must comply with OFAC sanctions, and U.S. financial institutions have suspicious activity reporting requirements. U.S. financial institutions are currently subject to a range of sanctions prohibitions related to North Korea, which has limited their direct exposure to the North Korean financial system. More recently, on March 15, 2016, the President issued Executive Order 13722, which places additional sanctions on North Korea and has the effect of generally prohibiting U.S. financial institutions from processing transactions involving persons located in North Korea and the North Korean government, unless authorized by OFAC.24 Therefore, current transactional activity between U.S. financial institutions and North Korean banks is very constricted. Further, North Korea is subject to a range of United Nations sanctions resolutions and it has been consistently called out by the FATF for its AML deficiencies. This has limited the number of foreign banking institutions that maintain ties or accounts with North Korean banks. Thus, the special due diligence that would be required under the BSA by the imposition of the fifth special measure—i.e., the one-time transmittal of notice to certain correspondent account holders, the screening of transactions to identify any use of correspondent accounts, and the implementation of risk-based measures to detect use of correspondent accounts—would not impose a significant additional economic burden upon small U.S. financial institutions.

    24See E.O. 13722 “Blocking Property of the Government of North Korea and the Workers Party of Korea, and Prohibiting Certain Transactions With Respect to North Korea” (2016) (https://www.thefederalregister.org/fdsys/pkg/FR-2016-03-18/pdf/FR-2016-03-18.pdf).

    B. Certification

    For these reasons, FinCEN certifies that the proposals contained in this rulemaking would not have a significant impact on a substantial number of small businesses.

    FinCEN invites comments from members of the public who believe there would be a significant economic impact on small entities from the imposition of the fifth special measure regarding North Korea.

    VI. Paperwork Reduction Act

    The collection of information contained in this proposed rule is being submitted to the Office of Management and Budget for review in accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. 3507(d)). Comments on the collection of information should be sent to the Desk Officer for the Department of Treasury, Office of Information and Regulatory Affairs, Office of Management and Budget, Paperwork Reduction Project (1506), Washington, DC 20503 (or by email to oira [email protected]) with a copy to FinCEN by mail or email at the addresses previously specified. Comments should be submitted by one method only. Comments on the collection of information should be received by August 2, 2016. In accordance with the requirements of the Paperwork Reduction Act and its implementing regulations, 5 CFR 1320, the following information concerning the collection of information as required by 31 CFR 1010.659 is presented to assist those persons wishing to comment on the information collection.

    A. Proposed Information Collection Under the Fifth Special Measure

    The notification requirement in section 1010.659(b)(3)(i) is intended to aid cooperation from correspondent account holders in denying North Korea access to the U.S. financial system. The information required to be maintained by section 1010.659(b)(4)(i) would be used by federal agencies and certain self-regulatory organizations to verify compliance by covered financial institutions with the provisions of 31 CFR 1010.659. The collection of information would be mandatory.

    Description of Affected Financial Institutions: Banks, broker-dealers in securities, futures commission merchants and introducing brokers-commodities, money services businesses, and mutual funds.

    Estimated Number of Affected Financial Institutions: 5,000.

    Estimated Average Annual Burden in Hours Per Affected Financial Institution: The estimated average burden associated with the collection of information in this proposed rule is one hour per affected financial institution.

    Estimated Total Annual Burden: 5,000 hours.

    FinCEN specifically invites comments on: (a) Whether the proposed collection of information is necessary for the proper performance of the mission of FinCEN, including whether the information would have practical utility; (b) the accuracy of FinCEN's estimate of the burden of the proposed collection of information; (c) ways to enhance the quality, utility, and clarity of the information required to be maintained; (d) ways to minimize the burden of the required collection of information, including through the use of automated collection techniques or other forms of information technology; and (e) estimates of capital or start-up costs and costs of operation, maintenance, and purchase of services to report the information.

    An agency may not conduct or sponsor, and a person is not required to respond to, a collection of information unless it displays a valid OMB control number.

    VII. Executive Order 12866

    Executive Orders 12866 and 13563 direct agencies to assess costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). Executive Order 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. It has been determined that the proposed rule is not a “significant regulatory action” for purposes of Executive Order 12866.

    List of Subjects in 31 CFR Part 1010

    Administrative practice and procedure, Banks and banking, Brokers, Counter-money laundering, Counter-terrorism, Foreign banking.

    Authority and Issuance

    For the reasons set forth in the preamble, part 1010, chapter X of title 31 of the Code of Federal Regulations, is proposed to be amended as follows:

    PART 1010—GENERAL PROVISIONS 1. The authority citation for part 1010 is revised to read as follows: Authority:

    12 U.S.C. 1829b and 1951-1959; 31 U.S.C. 5311-5314, 5316-5332; Title III, sec. 314 Pub. L. 107-56, 115 Stat. 307.

    2. Add § 1010.659 to read as follows:
    § 1010.659 Special measures against North Korea.

    (a) Definitions. For purposes of this section:

    (1) North Korean financial institution means all branches, offices, or subsidiaries of any foreign financial institution, as defined at § 1010.605(f), chartered or licensed by North Korea, wherever located, including any branches, offices, or subsidiaries of such financial institution operating in any jurisdiction, and any branch or office within North Korea of any foreign financial institution.

    (2) Foreign banking institution has the same meaning as provided in § 1010.100(u).

    (3) Correspondent account has the same meaning as provided in § 1010.605(c)(1)(i).

    (4) Covered financial institution has the same meaning as provided in § 1010.605(e)(1).

    (5) Subsidiary means a company of which more than 50 percent of the voting stock or analogous equity interest is owned by another company.

    (b) Prohibition on accounts and due diligence requirements for covered financial institutions—(1) Opening or maintenance of correspondent accounts. A covered financial institution shall not open or maintain in the United States a correspondent account for, or on behalf of, a North Korean banking institution.

    (2) Prohibition on use of correspondent accounts. A covered financial institution shall not process a transaction for the correspondent account of a foreign banking institution in the United States if such transaction involves a North Korean financial institution.

    (3) Special due diligence of correspondent accounts to prohibit use. (i) A covered financial institution shall apply special due diligence to its foreign correspondent accounts that is reasonably designed to guard against their use to process transactions involving North Korean financial institutions. At a minimum, that special due diligence must include:

    (A) Notifying those foreign correspondent account holders that the covered financial institution knows or has reason to believe provide services to a North Korean financial institution that such correspondents may not provide a North Korean financial institution with access to the correspondent account maintained at the covered financial institution; and

    (B) Taking reasonable steps to identify any use of its foreign correspondent accounts by a North Korean financial institution, to the extent that such use can be determined from transactional records maintained in the covered financial institution's normal course of business.

    (ii) A covered financial institution shall take a risk-based approach when deciding what, if any, other due diligence measures it reasonably must adopt to guard against the use of its foreign correspondent accounts to process transactions involving North Korean financial institutions.

    (iii) A covered financial institution that knows or has reason to believe that a foreign banking institution's correspondent account has been or is being used to process transactions involving a North Korean financial institution shall take all appropriate steps to further investigate and prevent such access, including the notification of its correspondent account holder under paragraph (b)(3)(i)(A) of this section and, where necessary, termination of the correspondent account.

    (4) Recordkeeping and reporting. (i) A covered financial institution is required to document its compliance with the notice requirement set forth in paragraph (b)(3)(i)(A) of this section.

    (ii) Nothing in this paragraph (b) shall require a covered financial institution to report any information not otherwise required to be reported by law or regulation.

    Jamal El-Hindi, Acting Director, Financial Crimes Enforcement Network.
    [FR Doc. 2016-13037 Filed 6-2-16; 8:45 am] BILLING CODE 4810-02-P
    DEPARTMENT OF HOMELAND SECURITY Coast Guard 33 CFR Part 165 [Docket Number USCG-2016-0340] RIN 1625-AA00 Safety Zones; Safety Zones Within the Captain of the Port New Orleans Zone; New Orleans to Baton Rouge, LA AGENCY:

    Coast Guard, DHS.

    ACTION:

    Notice of proposed rulemaking.

    SUMMARY:

    The Coast Guard proposes to establish temporary safety zones for multiple locations and dates within the Captain of the Port New Orleans' zone. These safety zones are necessary to protect persons and vessels from potential safety hazards associated with fireworks displays on or over federal waterways. Entry into these zones is prohibited unless specifically authorized by the Captain of the Port New Orleans or a designated representative.

    DATES:

    Comments and related material must be received by the Coast Guard on or before June 20, 2016.

    ADDRESSES:

    You may submit comments identified by docket number USCG-2016-0340 using the Federal eRulemaking Portal at http://www.regulations.gov. See the “Public Participation and Request for Comments” portion of the SUPPLEMENTARY INFORMATION section for further instructions on submitting comments.

    FOR FURTHER INFORMATION CONTACT:

    If you have questions about this proposed rulemaking, call or email Lieutenant Commander (LCDR) James Gatz, Sector New Orleans, at (504) 365-2281 or [email protected]

    SUPPLEMENTARY INFORMATION:

    I. Table of Abbreviations BNM Broadcast Notice to Mariners CFR Code of Federal Regulations DHS Department of Homeland Security FR Federal Register MSIB Marine Safety Information Bulletin NPRM Notice of proposed rulemaking §  Section U.S.C. United States Code II. Background, Purpose, and Legal Basis

    The Coast Guard proposes establishment of temporary safety zones for the following upcoming fireworks displays:

    (1) A corporate event scheduled for one hour in the evening between 6:00 p.m. and 11:00 p.m. on June 15, 2016. The fireworks barge will be positioned adjacent to the foot of Dumaine Street in New Orleans, LA, at approximate mile marker 94.5 above Head of Passes on the Lower Mississippi River. The Coast Guard was notified about this event on April 18, 2016.

    (2) The Llamasoft Convention scheduled for one hour in the evening between 6:00 p.m. and 11:00 p.m. on June 16, 2016. The fireworks barge will be positioned adjacent to Spanish Plaza in New Orleans, LA, at approximate mile marker 95.0 above Head of Passes on the Lower Mississippi River. The Coast Guard was notified about this event on April 1, 2016.

    (3) The U.S. Travel Association's “IPW” Conference scheduled for one hour in the evening between 6:00 p.m. and 11:00 p.m. on June 22, 2016. The fireworks barge will be positioned adjacent to Mardi Gras World in New Orleans, LA, at approximate mile marker 96.2 above Head of Passes on the Lower Mississippi River. The Coast Guard was notified about this event on April 1, 2016.

    (4) The St. John the Baptist Parish Independence Day Celebration scheduled for one hour in the evening between 6:00 p.m. and 11:00 p.m. on June 30, 2016. The fireworks barge will be positioned adjacent to the Parish Courthouse in Edgard, LA, at approximate mile marker 138.0 above Head of Passes on the Lower Mississippi River. The Coast Guard was notified about this event on March 15, 2016. This is an annually recurring event that is published in 33 CFR 165.801, Table 5, line no. 2. This year's occurrence is scheduled for a different date and location than currently listed in the CFR. Should a permanent change be necessary for this safety zone, we will include it in a future rulemaking proposing permanent updates to 33 CFR 165.801, Table 5.

    (5) The L'Auberge Casino Independence Day Celebration scheduled for one hour in the evening between 6:00 p.m. and 11:00 p.m. on July 4, 2016. The fireworks barge will be positioned adjacent to the L'Auberge Casino in Baton Rouge, LA, at approximate mile marker 216.5 above Head of Passes on the Lower Mississippi River. The Coast Guard was notified about this event on January 27, 2016. This is an annually-recurring event that is not currently published in Table 5 of 33 CFR 165.801. We plan to include it in a future rulemaking proposing permanent updates to 33 CFR 165.801, Table 5.

    (6) The City of Mandeville Independence Day Celebration scheduled for one hour in the evening between 6:00 p.m. and 11:00 p.m. on July 4, 2016. The fireworks barge will be positioned adjacent to the Mandeville City Lakefront in Mandeville, LA, at approximate position 30° 21.200 N., 90° 04.500 W. The Coast Guard was notified about this event on March 14, 2016. A safety zone was established in 2015 for a similar event. Based on the history of this event and safety zone need, we are considering making this safety zone a permanent recurring regulation, and may include it in a future rulemaking proposing permanent updates to 33 CFR 165.801, Table 5.

    (7) The American Psychological Association Convention scheduled for one hour in the evening between 6:00 p.m. and 11:00 p.m. on September 23, 2016. The fireworks barge will be positioned adjacent to Dumaine Street in New Orleans, LA, at approximate mile marker 94.5 above Head of Passes on the Lower Mississippi River. The Coast Guard was notified about this event on February 24, 2016.

    Due to the risks associated with aerial barge-based fireworks displays taking place on and over these sections of navigable waterways, the proposed safety zones are needed to protect persons and property. The Coast Guard would notify the public and maritime community of the proposed safety zones and their respective enforcement periods via broadcast notices to mariners (BNM). The Coast Guard proposes this rulemaking under authority in 33 U.S.C. 1231.

    III. Discussion of Proposed Rule

    The Coast Guard proposes to establish multiple temporary safety zones within the Captain of the Port New Orleans (COTP) Zone on several different dates and in several different locations. The safety zones to be established would be enforced on the respective dates listed above and in the proposed regulatory text as provided at the end of this document. Each safety zone will be limited to a duration of one hour, and will occur during the evenings on the dates specified, between the hours of 6:00 p.m. and 11:00 p.m. Entry into these safety zones is prohibited unless permission has been granted by the COTP New Orleans, or a designated representative.

    The COTP New Orleans will inform the public through BNMs of the enforcement period for each safety zone as well as any changes in the planned schedule. Mariners and other members of the public may also contact Coast Guard Sector New Orleans Command Center to inquire about the status of the safety zone by calling (504) 365-2200.

    IV. Regulatory Analyses

    We developed this proposed rule after considering numerous statutes and Executive orders related to rulemaking. Below we summarize our analyses based on a number of these statutes and Executive orders and we discuss First Amendment rights of protestors.

    A. Regulatory Planning and Review

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

    Six of these proposed safety zones would be no greater than 1 river mile in length and would restrict navigation on the Lower Mississippi River for no longer than one hour each. The remaining proposed safety zone would be limited to a circular area 1200 feet in diameter located along the North Shore of Lake Pontchartrain, in an area with ample room for other traffic to navigate around the safety zone, and would be in effect for no longer than one hour. Due to the limited scope and short duration of each proposed safety zone, the impacts on routine navigation are expected to be minimal. Additionally, the Coast Guard would issue maritime notices widely available to waterway users and deviation from the proposed safety zones may be requested and would be considered on a case-by-case basis.

    B. Impact on Small Entities

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

    While some owners or operators of vessels intending to transit the safety zones may be small entities, for the reasons stated in section IV.A above this proposed rule would not have a significant economic impact on any vessel owner or operator. If you think that your business, organization, or governmental jurisdiction qualifies as a small entity and that this rule would have a significant economic impact on it, please submit a comment (see ADDRESSES) explaining why you think it qualifies and how and to what degree this rule would economically affect it.

    Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Public Law 104-121), we want to assist small entities in understanding this proposed rule. If the rule would affect your small business, organization, or governmental jurisdiction and you have questions concerning its provisions or options for compliance, please contact the person listed in the FOR FURTHER INFORMATION CONTACT section. The Coast Guard will not retaliate against small entities that question or complain about this proposed rule or any policy or action of the Coast Guard.

    C. Collection of Information

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

    D. Federalism and Indian Tribal Governments

    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 proposed rule under that Order and have determined that it is consistent with the fundamental federalism principles and preemption requirements described in Executive Order 13132.

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

    E. Unfunded Mandates Reform Act

    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 proposed rule would not result in such an expenditure, we do discuss the effects of this rule elsewhere in this preamble.

    F. Environment

    We have analyzed this proposed rule under Department of Homeland Security Management Directive 023-01 and Commandant Instruction M16475.lD, which guide the Coast Guard in complying with the National Environmental Policy Act of 1969 (42 U.S.C. 4321-4370f), and have made a preliminary determination 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 proposes to establish seven temporary safety zones within the Captain of the Port New Orleans zone. Normally such actions are categorically excluded from further review under paragraph 34(g) of Figure 2-1 of Commandant Instruction M16475.lD. A preliminary environmental analysis checklist and 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 proposed rule.

    G. Protest Activities

    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.

    V. Public Participation and Request for Comments

    We view public participation as essential to effective rulemaking, and will consider all comments and material received during the comment period. Your comment can help shape the outcome of this rulemaking. If you submit a comment, please include the docket number for this rulemaking, indicate the specific section of this document to which each comment applies, and provide a reason for each suggestion or recommendation.

    We encourage you to submit comments through the Federal eRulemaking Portal at http://www.regulations.gov. If your material cannot be submitted using http://www.regulations.gov, contact the person in the FOR FURTHER INFORMATION CONTACT section of this document for alternate instructions.

    We accept anonymous comments. All comments received will be posted without change to http://www.regulations.gov and will include any personal information you have provided. For more about privacy and the docket, you may review a Privacy Act notice regarding the Federal Docket Management System in the March 24, 2005, issue of the Federal Register (70 FR 15086).

    Documents mentioned in this NPRM as being available in the docket, and all public comments, will be in our online docket at http://www.regulations.gov and can be viewed by following that Web site's instructions. Additionally, if you go to the online docket and sign up for email alerts, you will be notified when comments are posted or a final rule is published.

    List of Subjects in 33 CFR Part 165

    Marine safety, Navigation (water), Reporting and recordkeeping requirements, Security measures, Waterways.

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

    PART 165—REGULATED NAVIGATION AREAS AND LIMITED ACCESS AREAS 1. The authority citation for part 165 continues to read as follows: Authority:

    33 U.S.C. 1231; 50 U.S.C. 191; 33 CFR 1.05-1, 6.04-1, 6.04-6, and 160.5; Department of Homeland Security Delegation No. 0170.1.

    2. Add § 165.T08-0340 to read as follows:
    § 165.T08-0340 Safety Zones; Captain of the Port New Orleans Zone; New Orleans to Baton Rouge, LA.

    (a) Safety zones. The following areas are safety zones:

    (1) Fireworks display, New Orleans, LA. (i) Location. All waters of the Lower Mississippi River from mile marker 94.0 to mile marker 95.0 Above Head of Passes.

    (ii) Effective date and time. June 15, 2016, for one hour in the evening between the hours of 6:00 p.m. and 11:00 p.m.

    (2) LLamasoft Convention fireworks display, New Orleans, LA. (i) Location. All waters of the Lower Mississippi River from mile marker 94.5 to mile marker 95.5 Above Head of Passes.

    (ii) Effective date and time. June 16, 2016, for one hour in the evening between the hours of 6:00 p.m. and 11:00 p.m.

    (3) U.S. Travel Association fireworks display, New Orleans, LA. (i) Location. All waters of the Lower Mississippi River from mile marker 95.7 to mile marker 96.7 Above Head of Passes.

    (ii) Effective date and time. June 22, 2016, for one hour in the evening between the hours of 6:00 p.m. and 11:00 p.m.

    (4) St. John the Baptist Independence Day Celebration fireworks display, Edgard, LA. (i) Location. All waters of the Lower Mississippi River from mile marker 137.5 to mile marker 138.5 Above Head of Passes.

    (ii) Effective date and time. June 30, 2016, for one hour in the evening between the hours of 6:00 p.m. and 11:00 p.m.

    (5) L'Auberge Casino Independence Day Celebration fireworks display, Baton Rouge, LA. (i) Location. All waters of the Lower Mississippi River from mile marker 216.0 to mile 217.0 Above Head of Passes.

    (ii) Effective date and time. July 4, 2016, for one hour in the evening between the hours of 6:00 p.m. and 11:00 p.m.

    (6) City of Mandeville Independence Day Celebration fireworks display, Mandeville, LA. (i) Location. All waters of Lake Pontchartrain extending 600 feet in any direction from 30° 21.200 N., 090° 04.500 W.

    (ii) Effective date and time. July 4, 2016, for one hour in the evening between the hours of 6:00 p.m. and 11:00 p.m.

    (7) American Psychological Association Convention fireworks display, New Orleans, LA. (i) Location. All waters of the Lower Mississippi River from mile marker 94.0 to mile marker 95.0 Above Head of Passes.

    (ii) Effective date and time. September 23, 2016, for one hour in the evening between the hours of 6:00 p.m. and 11:00 p.m.

    (b) Regulations. (1) In accordance with the general regulations in § 165.23 of this part, entry into these zones is prohibited unless specifically authorized by the Captain of the Port (COTP) New Orleans or designated personnel. Designated personnel include commissioned, warrant and petty officers of the U.S. Coast Guard assigned to units under the operational control of USCG Sector New Orleans. For each event, the COTP New Orleans designated representative will be announced via Marine Safety Information Bulletin and Notice to Mariners.

    (2) Vessels requiring deviation from this rule must request permission from the COTP New Orleans or a COTP New Orleans designated representative. They may be contacted via the U.S. Coast Guard Sector New Orleans Command Center, via VHF-FM Channel 16 or by phone at (504) 365-2200.

    (3) Persons and vessels permitted to deviate from this safety zone regulation and enter the restricted areas must transit at the slowest safe speed and comply with all lawful directions issued by the COTP New Orleans or the designated representative.

    (c) Information Broadcasts. The COTP New Orleans or designated representative will inform the public through broadcast notices to mariners of the enforcement periods for the safety zones as well as any changes in the planned schedules.

    Dated: May 13, 2016. P.C. Schifflin, Captain, U.S. Coast Guard, Captain of the Port New Orleans.
    [FR Doc. 2016-13119 Filed 6-2-16; 8:45 am] BILLING CODE 9110-04-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 52 [EPA-R06-OAR-2013-0465; FRL-9947-24-Region 6] Approval and Promulgation of Air Quality Implementation Plans; Louisiana; Infrastructure State Implementation Plan Requirements for the National Ambient Air Quality Standards AGENCY:

    Environmental Protection Agency (EPA).

    ACTION:

    Proposed rule.

    SUMMARY:

    The Environmental Protection Agency (EPA) is proposing to approve elements of a State Implementation Plan (SIP) submission from the State of Louisiana for National Ambient Air Quality Standards (NAAQS) for fine particulate matter (PM2.5), lead (Pb), ozone (O3), nitrogen dioxide (NO2), and sulfur dioxide (SO2). This submission addresses how the existing SIP provides for implementation, maintenance, and enforcement of the NAAQS for these pollutants (also referred to as an infrastructure SIP or i-SIP). These i-SIPs ensure that the State's SIP is adequate to meet the state's responsibilities under the Federal Clean Air Act (CAA).

    DATES:

    Written comments must be received on or before July 5, 2016.

    ADDRESSES:

    Submit your comments, identified by Docket No. EPA-R06-OAR-2013-0465, at http://www.regulations.gov or via email to [email protected] Follow the online instructions for submitting comments. Once submitted, comments cannot be edited or removed from Regulations.gov. The EPA may publish any comment received to its public docket. Do not submit electronically any information you consider to be Confidential Business Information (CBI) or other information whose disclosure is restricted by statute. Multimedia submissions (audio, video, etc.) must be accompanied by a written comment. The written comment is considered the official comment and should include discussion of all points you wish to make. The EPA will generally not consider comments or comment contents located outside of the primary submission (i.e. on the web, cloud, or other file sharing system). For additional submission methods, please contact Sherry Fuerst, (214) 665-6454, [email protected] For the full EPA public comment policy, information about CBI or multimedia submissions, and general guidance on making effective comments, please visit http://www2.epa.gov/dockets/commenting-epa-dockets.

    Docket: The index to the docket for this action is available electronically at www.regulations.gov and in hard copy at EPA Region 6, 1445 Ross Avenue, Suite 700, Dallas, Texas. While all documents in the docket are listed in the index, some information may be publicly available only at the hard copy location (e.g., copyrighted material), and some may not be publicly available at either location (e.g., CBI).

    FOR FURTHER INFORMATION CONTACT:

    Sherry Fuerst, (214) 665-6454, [email protected] To inspect the hard copy materials, please schedule an appointment with her or Bill Deese at (214) 665-7253.

    SUPPLEMENTARY INFORMATION:

    Throughout this document “we,” “us,” or “our” mean EPA.

    I. Background

    On October 17, 2006, following a periodic review of the NAAQS for PM2.5, EPA revised the PM 2.5 NAAQS.1 The 24-hour standard was revised to 35 micrograms per cubic meter (μg/m3), and the annual standard was revised to 15 μg/m3 (71 FR 61144). On December 14, 2012, we promulgated a revised primary annual PM2.5 NAAQS (78 FR 3086). The primary annual standard was revised to 12.0 μg/m3, and we retained the 24-hour PM2.5 standard of 35 μg/m3 (78 FR 3086). In 2008, following a periodic review of the NAAQS for Pb, we revised the NAAQS to 0.15 μg/m3 for both the primary and secondary standards (73 FR 66964). On March 27, 2008, following a periodic review, EPA revised the primary and secondary O3 NAAQS (73 FR 16205) to establish a new primary standard of 0.075 parts per million (ppm), expressed to three decimal places, based on a 3-year average of the fourth-highest maximum 8-hour average concentration, and revised the current 8-hour standard by making it identical to the revised primary standard.

    1 Additional information on: The history of the pollutants, its levels, forms and, determination of compliance; EPA's approach for reviewing i-SIPs; the details of the SIPs submittal and EPA's evaluation; the effect of recent court decisions on i-SIPs; the statute and regulatory citations in the Louisiana SIP specific to this review; the specific i-SIP applicable CAA and EPA regulatory citation; Federal Register Louisiana minor New Source Review program and EPA approval activities; and Louisiana's Prevention of Significant Deterioration (PSD) program can be found in the Technical Support Document (TSD).

    Likewise, on February 9, 2010, EPA revised the primary national ambient air quality standard for oxides of nitrogen as measured by nitrogen dioxide (NO2), for 1-hour standard at a level of 100 ppb, based on the 3-year average of the 98th percentile of the yearly distribution of 1-hour daily maximum concentrations, to supplement the existing annual standard (75 FR 6474). EPA also established requirements for an NO2 monitoring network that includes monitors at locations where maximum NO2 concentrations are expected to occur, including within 50 meters of major roadways, as well as monitors sited to measure the area-wide NO2 concentrations that occur more broadly across communities. (75 FR 6474).

    Additionally, on June 22, 2010, the EPA revised the primary SO2 NAAQS to establish a new 1-hour standard, with a level of 75 ppb, based on the 3-year average of the annual 99th percentile of 1-hour daily maximum concentrations (75 FR 35520).

    Each state must submit an i-SIP within three years after the promulgation of a new or revised NAAQS. Section 110(a)(2) of the CAA includes a list of specific elements the i-SIP must meet. In an effort to assist states in complying with this requirement, EPA issued guidance addressing the i-SIP elements for NAAQS.2

    2 “Guidance on Infrastructure State Implementation Plan (SIP) Elements under Clean Air Act sections 110(a)(1) and 110(a)(2),” Memorandum from Stephen D. Page, September 13, 2013.

    The Secretary of the Louisiana Department of Environmental Quality (LDEQ) submitted i-SIP revisions to address the revised NAAQS.

    With the exception of the certain portions that pertain to interstate transport, EPA is proposing to approve the Louisiana i-SIP submittals for these pollutant NAAQS.3 The exceptions are (1) the portions of the 2008 ozone NAAQS submittal that pertain to interstate transport of Louisiana emissions which will significantly contribute to nonattainment of the NAAQS in other states, (2) the portion of the 2010 SO2 NAAQS submittal that pertains to interstate transport of Louisiana emissions to other states, and (3) the portions which will interfere with visibility protection measures in other states for the 2006 and 2012 PM2.5, 2008 Pb, 2008 O3, 2010 NO2, and 2010 SO2 NAAQS. We will take separate action on the portions of the 2008 ozone and 2010 SO2 NAAQS submittal that pertain to significant contribution to nonattainment or interference with maintenance of the NAAQS in other states. We have disapproved portions of the Louisiana Regional Haze Plan submittal that pertain to interference with visibility protection measures in other states (77 FR 39425). LDEQ and EPA are currently working on a revised Louisiana Regional Haze Plan.

    3 Additional information on: The history of the priority pollutants, their levels, forms and, determination of compliance; EPA's approach for reviewing i-SIPs; the details of the SIP submittal and EPA's evaluation; the effect of recent court decisions on i-SIPs; the statute and regulatory citations in the Louisiana SIP specific to this review; the specific i-SIP applicable CAA and EPA regulatory citations; Federal Register Notice citations for Louisiana SIP approvals; Louisiana's minor New Source Review program and EPA approval activities; and, Louisiana`s Prevention of Significant Deterioration (PSD) program can be found in the Technical Support Document (TSD).

    II. EPA's Evaluation of Louisiana's NAAQS Infrastructure Submissions

    Below is a summary of EPA's evaluation of the Louisiana i-SIP for each applicable element of 110(a)(2) A-M.4 Louisiana provided a demonstration of how the existing Louisiana SIP meets the requirements of the 2006 PM2.5 NAAQS, on May 11, 2011; 2008 Pb NAAQS on October 14, 2011; 2008 O3, 2010 NO2, 2010 SO2 NAAQS on June 7, 2013 and the 2012 PM2.5 NAAQS on December 16, 2015. The 2006 PM2.5, 2008 Pb, 2008 O3, 2010 NO2 and 2010 SO2 SIP submissions are complete by operation of law.5 The 2012 PM2.5 submission was reviewed and determined to be complete.

    4 A detailed discussion of our evaluation can be found in the TSD for this action. The TSD can be accessed through www.regulations.gov (e-docket EPA-R06-OAR-2013-0465).

    5 These SIP submissions became complete by operation of law on November 11, 2012 (2006 PM2.5), April 14, 2012 (2008 Pb), and December 7, 2013 (2008 O3, 2010 NO2, and 2010 SO2). See CAA section 110(k)(1)(B).

    (A) Emission limits and other control measures: The SIP must include enforceable emission limits and other control measures, means or techniques, schedules for compliance and other related matters as needed to implement, maintain and enforce each of the NAAQS.6 The Louisiana Air Control Law found in the Louisiana Environmental Quality Act at Louisiana Revised Statute (La R.S.)30:2054 provides the Secretary of the Department of Environmental Quality with broad legal authority. The Secretary can adopt emission standards and compliance schedules which are applicable to regulated entities; emission standards and limitations and any other measures necessary for attainment and maintenance of national standards. The Secretary can also enforce applicable laws, regulations, standards and compliance schedules, and seek injunctive relief. This authority has been employed in the past to adopt and submit multiple revisions to the Louisiana State Implementation Plan. The approved SIP for Louisiana is documented at 40 CFR part 52.970, subpart T.7 LDEQ's air quality rules and standards are codified at Title 33, Part III of the Louisiana Administrative Code (LAC). Numerous parts of the regulations codified into 33 LAC necessary for implementing and enforcing the NAAQS have been adopted into the SIP.8

    6 The specific nonattainment area plan requirements of section 110(a)(2)(I) are subject to the timing requirements of section 172, not the timing requirement of section 110(a)(1). Thus, section 110(a)(2)(A) does not require that states submit regulations or emissions limits specifically for attaining the 2006 PM2.5, 2008 Pb, 2008 O3, 2010 NO2, 2010 SO2 or 2012 PM2.5 NAAQS. Those SIP provisions are due as part of each state's attainment plan, and will be addressed separately from the requirements of section 110(a)(2)(A). In the context of an infrastructure SIP, EPA is not evaluating the existing SIP provisions for this purpose. Instead, EPA is only evaluating whether the state's SIP has basic structural provisions for the implementation of the NAAQS.

    7http://www.ecfr.gov/cgi-bin/text-idx?SID=6e98cdf87e1b896da1b0a8cc2d2f69d6&mc=true&node=sp40.3.52.t&rgn=div6.

    8 See the TSD for additional information.

    (B) Ambient air quality monitoring/data system: The SIP must provide for: Establishment and implementation of ambient air quality monitors, collection and analysis of ambient air quality data, and authority to provide such data to EPA upon request.

    The La R.S. Chapter 2 provides LDEQ with the authority to collect air quality monitoring data, quality-assure the results, and report the data. LDEQ maintains and operates a monitoring network to measure levels of the pollutants in accordance with EPA regulations specifying siting and monitoring requirements. All monitoring data is measured using EPA approved methods and subject to the EPA quality assurance requirements. LDEQ submits all required data to EPA, following the EPA regulations. The monitoring network was approved into the SIP and it undergoes recurrent annual review by EPA.9 In addition, LDEQ conducts a recurrent assessment of its monitoring network every five years, as required by EPA rules. The most recent of these 5-year monitoring network assessments was conducted by LDEQ and approved by EPA.10 The LDEQ Web site provides the monitor locations and posts past and current concentrations of criteria pollutants measured in the State's network of monitors.11

    9 A copy of the 2015 Annual Air Monitoring Network Plan and EPA's approval letter are included in the docket for this proposed rulemaking.

    10 A copy of LDEQ's 2010 5-year ambient monitoring network assessment and EPA's approval letter are included in the docket for this proposed rulemaking.

    11 See http://airquality.deq.louisiana.gov/ and http://www.deq.louisiana.gov/portal/DIVISIONS/Assessment/AirFieldServices/AmbientAirMonitoringProgram/AmbientAirMonitoringDataandReports.aspx.

    (C) Program for enforcement of control measures: The SIP must include the following three elements: (1) A program providing for enforcement of the measures in paragraph A above; (2) a program for the regulation of the modification and construction of stationary sources as necessary to protect the applicable NAAQS (i.e., state-wide permitting of minor sources); and (3) a permit program to meet the major source permitting requirements of the CAA (for areas designated as attainment or unclassifiable for the NAAQS in question).12

    12 As discussed in further detail in the TSD.

    (1) Enforcement of SIP Measures. As noted in (A), the state statutes provide authority for the LDEQ and its Secretary to enforce the requirements of the LAC, and any regulations, permits, or final compliance orders. These statutes also provide the LDEQ and its Secretary with general enforcement powers. Among other things, they can file lawsuits to compel compliance with the statutes and regulations; commence civil actions; issue field citations; conduct investigations of regulated entities; collect criminal and civil penalties; develop and enforce rules and standards related to protection of air quality; issue compliance orders; pursue criminal prosecutions; investigate, enter into remediation agreements; and issue emergency cease and desist orders. The LAC also provides additional enforcement authorities and funding mechanisms.

    (2) Minor New Source Review. The SIP is required to include measures to regulate construction and modification of stationary sources to protect the NAAQS. The Louisiana minor NSR permitting requirements are approved as part of the SIP.13

    13 EPA is not proposing to approve or disapprove the existing Louisiana minor NSR program to the extent that it may be inconsistent with EPA's regulations governing this program. EPA has maintained that the CAA does not require that new infrastructure SIP submissions correct any defects in existing EPA-approved provisions of minor NSR programs in order for EPA to approve the infrastructure SIP for element C (e.g., 76 FR 41076-41079, July 13 2011). EPA believes that a number of states may have minor NSR provisions that are contrary to the existing EPA regulations for this program. The statutory requirements of section 110(a)(2)(C) provide for considerable flexibility in designing minor NSR programs.

    (3) Prevention of Significant Deterioration (PSD) permit program. The Louisiana PSD portion of the SIP covers all NSR regulated pollutants and has been approved by EPA.14

    14 As discussed further in the TSD.

    (D)(i) Interstate Pollution Transport: The i-SIP must prohibit emissions within Louisiana from contributing significantly to the nonattainment of the NAAQS in other states, and from interfering with the maintenance of the NAAQS in other states (CAA(a)(2)(D)(i)(I)). The SIP must also prohibit emissions within Louisiana both from interfering with measures required to prevent significant deterioration in other states and from interfering with measures required to protect visibility in other states (CAA(a)(2)(D)(i)(II)).

    Fine Particulate Matter: Previously we approved the portion of Louisiana's 2006 PM2.5 NAAQS i-SIP which addressed the requirement that emissions within Louisiana be prohibited from contributing to the nonattainment of the NAAQS in other states, and from interfering with the maintenance of the NAAQS in other states (79 FR 4436). We are not acting on the nonattainment/maintenance component for the 2012 PM2.5 NAAQS at this time. We expect to propose an action at a later date.

    Based on information presented in this submission, we are approving the portion of the i-SIP submittal for both the 2006 PM2.5 NAAQS and the 2012 PM2.5 NAAQS which addresses the prevention of interference with PSD programs in other states. Louisiana has a fully acceptable PSD program. The program regulates all NSR pollutants, including greenhouse gas (GHG) which prevents significant deterioration in nearby states. Since Louisiana's Regional Haze Plan was not fully approved, we are disapproving the portion of the i-SIP which addresses the prevention of interference with measures required to protect visibility in other states for both the 2006 PM2.5 NAAQS and the 2012 PM2.5 NAAQS. We cannot ensure that Louisiana emissions will not interfere with visibility protection measures in other States.

    Lead: We propose to approve the portion of the submittal which addresses the requirement that emissions within Louisiana be prohibited from contributing to the nonattainment of the Pb NAAQS in other states, and from interfering with the maintenance of the Pb NAAQS in other states. The physical properties of Pb, which is a metal and very dense, prevent Pb emissions from experiencing a significant degree of travel in the ambient air. No complex chemistry is needed to form Pb or Pb compounds in the ambient air; therefore, ambient concentrations of Pb are typically highest near Pb sources. More specifically, there is a sharp decrease in ambient Pb concentrations as the distance from the source increases. According to EPA's report entitled Our Nation's Air: Status and Trends Through 2010, Pb concentrations that are not near a source of Pb are approximately 8 times less than the typical concentrations near the source.15 There are no areas within the State of Louisiana designated as nonattainment with respect to the 2008 lead NAAQS. LDEQ's 2015 ambient monitoring plan provided information on significant lead sources and their location. There are two significant sources of Pb emissions within the state that emit more than Pb in amounts equal to or exceeding 0.5 tons per year and no sources within two miles of a neighboring state line.

    15http://www.epa.gov/airtrends/2011/report/fullreport.pdf.

    We are also proposing to approve the portion pertaining to the prevention of significant deterioration in other states for lead, as Louisiana has a fully acceptable PSD program. The program regulates all NSR pollutants, including greenhouse gas (GHG) which prevents significant deterioration in nearby States.

    Significant impacts from Pb emissions from stationary sources are limited to short distances from emitting sources, therefore, visibility is not effected by lead emissions.16 Given this information, we propose to approve the portion of the Pb i-SIP submittal related to the protection of visibility in other states.

    16 More information about this is provided in the TSD.

    Ozone: At this time we are not proposing action on the i-SIP submittals which address the prevention of emissions which significantly contribute to the nonattainment of the ozone NAAQS in other states, and the interference with the maintenance of the ozone NAAQS in other states. We plan to act on this portion of the i-SIP in a separate action.

    Based on information presented in this submission, we are proposing to approve the portion of the submittal related to the prevention of significant deterioration in other states, as Louisiana has a fully acceptable PSD program. The program regulates all NSR pollutants, including greenhouse gas (GHG) which prevents significant deterioration in nearby states. Since Louisiana's Regional Haze Plan was not fully approved, we also are disapproving the portion of the submittal related to the protection of visibility in other states.

    Nitrogen Dioxide: We propose to approve the portion of the submittal which addresses the prevention of emissions which significantly contribute to the nonattainment of the NO2 NAAQS in other states and interfere with the maintenance of the NO2 NAAQS in other states. On February 17, 2012, EPA designated the entire country as “unclassifiable/attainment” for the 2010 NO2.17 The available air quality data show that all areas in the country meet the 2010 NO2 NAAQS for 2008-2010. No state or tribal entity recommended an area be designated “nonattainment.” As listed in our NO2 Design Values report,18 only one maintenance area exists for the prior annual NO2 NAAQS (Los Angeles, California). With no nonattainment or maintenance areas in surrounding states, Louisiana does not significantly contribute to nonattainment or maintenance of these NAAQS in any of the contiguous states. As further evidence that Louisiana's NO2 emissions do not contribute to nonattainment or maintenance of NAAQS, we reviewed more recent monitoring data for NO2 throughout the United States. Using previous EPA methodology,19 we evaluated specific monitors identified as having nonattainment and or maintenance problems, which we refer to as “receptors”. We identify nonattainment receptors as any monitor that violated the NO2 NAAQS in the most recent three year period. Meanwhile, we identify NO2 maintenance receptors as any monitor that violated the NO2 NAAQS in either of the prior monitoring cycles (2010-2012 and 2011-2013), but attained in the most recent monitoring cycle (2012-2014). During the three most recent design value periods of 2010 through 2012, 2011 through 2013 and 2012 through 2014, we found no monitors violating the 2010 NO2 NAAQS in the U.S.

    17 77 FR 9532, February 17, 2012.

    18http://epa.gov/airtrends/values.html.

    19 See NOX SIP call, 63 FR 57371 (October 27, 1998); CAIR, 7025172 (May 12, 2005; and Transport Rule or Cross-State Air Pollution Rule 76 FR 48208 (August 8, 2001).

    We are approving the portion of the submittal related to the prevention of significant deterioration in other states, as Louisiana has a fully acceptable PSD program. The program regulates all NSR pollutants, including greenhouse gas (GHG) which prevents significant deterioration in nearby states. Since Louisiana's Regional Haze Plan was not fully approved, we also are not approving the portion of the submittal related to the protection of visibility in other states.

    Sulfur Dioxide: At this time we not taking action on the portion of the submittal which addresses the prevention of emissions which significantly contribute to the nonattainment of the SO2 NAAQS in other states and interfere with the maintenance of the SO2 NAAQS in other states. We expect to take action on this portion of the SIP submittal at a later time.

    (D)(ii) Interstate Pollution Abatement and International Air Pollution: In addition, states must comply with the requirements listed in sections 115 and 126 of the CAA which were designed to aid in the abatement of interstate and international pollution (CAA 110(a)(2)(D)(ii)). Section 126(a) requires new or modified sources to notify neighboring states of potential impacts from the source. Louisiana's PSD program contains the element pertaining to notification to neighboring states of the issuance of PSD permits. Section 115 relates to international pollution abatement. As there are no findings by EPA that air emissions originating in Louisiana affect other countries, we propose to approve the portions of the i-SIPs pertaining to CAA section 110(a)(2)(D)(ii).

    (E) Adequate authority, resources, implementation, and oversight: The SIP must provide for the following: (1) Necessary assurances that the state (and other entities within the state responsible for implementing the SIP) will have adequate personnel, funding, and authority under state or local law to implement the SIP, and that there are no legal impediments to such implementation; (2) compliance with requirements relating to state boards as explained in section 128 of the CAA; and (3) necessary assurances that the state has responsibility for ensuring adequate implementation of any plan provision for which it relies on local governments or other entities to carry out. Both elements (A) and (E) address the state have adequate authority to implement and enforce the SIP without legal impediments.

    The i-SIP submissions for these pollutants describe the SIP regulations governing the various functions of personnel within the LDEQ, including the administrative, technical support, planning, enforcement, and permitting functions of the program.

    With respect to funding, La R.S. 30:2011 and the SIP require LDEQ to establish an emissions fee schedule for sources in order to fund the reasonable costs of administering various air pollution control programs and authorizes LDEQ to collect additional fees necessary to cover reasonable costs associated with processing of air permit applications. EPA conducts periodic program reviews to ensure that the state has adequate resources and funding to, among other things, implement and enforce the SIP.

    As required by the CAA and the SIP, the majority of the members that compose any board or body which approves permits or enforcement orders must not derive any “significant portion” of their income from persons subject to permits and enforcement orders or persons who appear before the board on issues related to the CAA or the Louisiana Air Quality Rules (La. R.S. 2014.1). The members of the board or body, or the head of an agency with similar powers, are required to adequately disclose any potential conflicts of interest.

    Louisiana has not delegated any authority to implement any of the provisions of its plan to local governmental entities. The LDEQ acts as the primary air pollution control agency.

    (F) Stationary source monitoring system: The SIP must provide for the establishment of a system to monitor emissions from stationary sources and to submit periodic emission reports. It must require the installation, maintenance, and replacement of equipment, and the implementation of other necessary steps, by owners or operators of stationary sources, to monitor emissions from such sources. The SIP shall also require periodic reports on the nature and amounts of emissions and emissions-related data from such sources. It shall require that the state correlate the source reports with emission limitations or standards established under the CAA. These reports must be made available for public inspection at reasonable times.

    LAC 33:III Chapter 9 authorizes the LDEQ to require persons engaged in operations which result in air pollution to monitor or test emissions and to file reports containing information relating to the nature and amount of emissions. There are also SIP-approved state regulations pertaining to sampling and testing and requirements for reporting of emissions inventories (60 FR 02014). In addition, SIP-approved rules establish general requirements for maintaining records and reporting emissions.

    The LDEQ uses this information, in addition to information obtained from other sources, to track progress towards maintaining the NAAQS, develop control and maintenance strategies, identify sources and general emission levels, and determine compliance with SIP-approved regulations and additional EPA requirements. The SIP requires this information be made available to the public. Provisions concerning the handling of confidential data and proprietary business information are included in the SIP-approved regulations. These rules specifically exclude from confidential treatment any records concerning the nature and amount of emissions reported by sources.

    (G) Emergency authority: The SIP must provide the LDEQ with authority to restrain any source from causing imminent and substantial endangerment to public health or welfare or the environment. The SIP must include an adequate contingency plan to implement LDEQ's emergency authority.

    La R.S 30:2011.D.15 provides LDEQ with the required authority to address environmental emergencies, and LDEQ has contingency plans to implement the emergency episode provisions in the SIP. The LDEQ promulgated the “Prevention of Air Pollution Emergency Episodes,” which includes contingency measures, and these provisions were approved into the SIP in 1989 (54 FR 9783). The episode criteria and contingency measures are found in 33 LAC Chapter 56.

    Louisiana has general emergency powers to address any possible dangerous air pollution episode if necessary to protect the environment and public health.

    (H) Future SIP revisions: States must have the authority to revise their SIPs in response to changes in the NAAQS, availability of improved methods for attaining the NAAQS, or in response to an EPA finding that the SIP is substantially inadequate to attain the NAAQS.

    La R.S. 30:2011 authorizes the LDEQ to revise the Louisiana SIP, as necessary, to account for revisions of an existing NAAQS, establishment of a new NAAQS, to attain and maintain a NAAQS, to abate air pollution, to adopt more effective methods of attaining a NAAQS, and to respond to EPA SIP calls concerning NAAQS adoption or implementation.

    (I) Nonattainment areas: The CAA section 110(a)(2)(I) requires that in the case of a plan or plan revision for areas designated as nonattainment areas, states must meet applicable requirements of part D of the CAA, relating to SIP requirements for designated nonattainment areas.

    However, as noted earlier, EPA believes that nonattainment area requirements should be treated separately from the infrastructure SIP requirements. The specific SIP submissions for designated nonattainment areas, as required under CAA title I, part D, are subject to different submission schedules than those for section 110 infrastructure elements. Instead, EPA will take action on part D attainment plan SIP submissions through a separate rulemaking process governed by the requirements for nonattainment areas, as described in part D.20

    20 This infrastructure SIP rulemaking will not address the Louisiana program for provisions related to nonattainment areas, since EPA considers evaluation of these provisions to be outside the scope of infrastructure SIP actions.

    (J) Consultation with government officials, public notification, PSD and visibility protection: The SIP must meet the following four CAA requirements: (1) Those listed in section 121 of the CAA, relating to interagency consultation; (2) those listed in section 127, relating to public notification of NAAQS exceedances and related issues; (3) prevention of significant deterioration of air quality and (4) visibility protection.

    (1) Interagency consultation: As required by the LAC, there must be a public hearing before the adoption of any regulations or emission control requirements, and all interested persons are given a reasonable opportunity to review the action that is being proposed and to submit data or arguments, either orally or in writing, and to examine witnesses testifying at the hearing (La R.S. 30:2011). In addition, the LAC provides the LDEQ the power and duty to establish cooperative agreements with local authorities, and consult with other states, the federal government and other interested persons or groups in regard to matters of common interest in the field of air quality control (La. R.S. 30:2032). Furthermore, the Louisiana PSD SIP rules mandate that the LDEQ provide for public participation and notification regarding permitting applications to any other state or local air pollution control agencies, local government officials of the city or county where the source will be located, tribal authorities, and Federal Land Manager (FLMs) whose lands may be affected by emissions from the source or modification (LAC 33:III.509). Additionally, the State's PSD SIP rules require the LDEQ to consult with FLMs regarding permit applications for sources with the potential to impact Class I Federal Areas. The SIP also includes a commitment to consult continually with the FLMs on the review and implementation of the visibility program. Louisiana recognizes the expertise of the FLMs in monitoring, as well as new source review applicability analyses for visibility. The State has agreed to notify the FLMs of any advance notification or early consultation with a new or modifying source prior to the submission of a permit application. Likewise, the State's Transportation Conformity SIP rules provide for interagency consultation, resolution of conflicts, and public notification.

    (2) Public Notification: On January 10, 1980, the Governor submitted final revisions to the ambient monitoring portion of the plan. These revisions were included into the SIP on August 6, 1981 (46 FR 40005). This portion of the SIP includes requirements for public notification of information related to air quality standards violation included in Part 51 in order to meet the requirements of Section 127 of the Act, requiring the LDEQ to regularly notify the public of instances or areas in which any NAAQS are exceeded. In addition, as discussed for infrastructure element B above, the LDEQ air monitoring Web site provides quality data for each of the monitoring stations in Louisiana; this data is provided instantaneously for certain pollutants, such as ozone. The Web site also provides information on the health effects of lead, ozone, particulate matter, and other criteria pollutants.

    (3) PSD and Visibility Protection: The PSD requirements for this element are the same as those addressed under element (C) above. As was mentioned earlier, the State has a PSD program, so this requirement has been met. The Louisiana SIP requirements relating to visibility and regional haze are not affected when EPA establishes or revises a NAAQS. Therefore, EPA believes that there are no new visibility protection requirements due to the revision of the NAAQS, and consequently there are no newly applicable visibility protection obligations pursuant to infrastructure element (J).

    (K) Air quality and modeling/data: The SIP must provide for performing air quality modeling, as prescribed by EPA, to predict the effects on ambient air quality of any emissions of any NAAQS pollutant, and for submission of such data to EPA upon request.

    The LDEQ has the power and duty, under La R.S. 30:2011 et seq. to develop facts and investigate providing for the functions of environmental air quality assessment. Past modeling and emissions reductions measures have been submitted by the State and approved into the SIP. Additionally, Louisiana has the ability to perform modeling for primary and secondary NAAQS on a case by case permit basis consistent with their SIP-approved PSD rules and with EPA guidance.

    The La R.S. authorizes and requires LDEQ to cooperate with the federal government and local authorities concerning matters of common interest in the field of air quality control, thereby allowing the agency to make such submissions to the EPA.

    (L) Permitting Fees: The SIP must require each major stationary source to pay permitting fees to the permitting authority, as a condition of any permit required under the CAA, to cover the cost of reviewing and acting upon any application for such a permit, and, if the permit is issued, the costs of implementing and enforcing the terms of the permit. The fee requirement applies until a fee program established by the state pursuant to Title V of the CAA, relating to operating permits, is approved by EPA.

    The State has met this requirement as it has a fully developed fee system in place which is outlined in LAC:III Chapter 2 and is approved as part of the SIP. See element (E) above for the description of the mandatory collection of permitting fees outlined in the SIP.

    (M) Consultation/participation by affected local entities: The SIP must provide for consultation and participation by local political subdivisions affected by the SIP.

    See the discussion for element (J) above for a description of the SIP's public participation process, the authority to advise and consult, and the PSD SIP's public participation requirements. Additionally, the state noted that La R.S. 30: 2011(D)(21) also requires initiation of cooperative action between local authorities and the LDEQ, between one local authority and another, or among any combination of local authorities and the LDEQ for control of air pollution in areas having related air pollution problems that overlap the boundaries of political subdivisions, and entering into agreements and compacts with adjoining states and Indian tribes, where appropriate. The transportation conformity component of the Louisiana SIP requires that interagency consultation and opportunity for public involvement be provided before making transportation conformity determinations and before adopting applicable SIP revisions on transportation-related issues. (LAC 33:III1434)

    III. Proposed Action

    EPA is proposing to approve in part the May 11, 2011, October 14, 2011, June 7, 2013 and December 16, 2015 infrastructure SIP submissions from Louisiana, which address the requirements of CAA sections 110(a)(1) and (2) as applicable to the 2006 PM2.5, 2008 Pb, 2008 O3, 2010 NO2, 2010 SO2, and 2012 PM2.5 NAAQS. The table below outlines the specific actions EPA is proposing to take.

    Proposed Action on Louisiana Infrastructure SIP Submittal for Various NAAQS Element 2006
  • PM2.5
  • 2008
  • Pb
  • 2008
  • Ozone
  • 2010
  • NO2
  • 2010
  • SO2
  • 2012
  • PM2.5
  • (A): Emission limits and other control measures A A A A A A (B): Ambient air quality monitoring and data system A A A A A A (C)(i): Enforcement of SIP measures A A A A A A (C)(ii): PSD program for major sources and major modifications A A A A A A (C)(iii): Permitting program for minor sources and minor modifications A A A A A A (D)(i)(I): Contribute to nonattainment/interfere with maintenance of NAAQS (requirements 1 and 2) A* A No action A No action No action (D)(i)(II): PSD (requirement 3) A A A A A A (D)(i)(II): Visibility Protection (requirement 4) D A D D D D (D)(ii): Interstate and International Pollution Abatement A A A A A A (E)(i): Adequate resources A A A A A A (E)(ii): State boards A A A A A A (E)(iii): Necessary assurances with respect to local agencies A A A A A A (F): Stationary source monitoring system A A A A A A (G): Emergency power A A A A A A (H): Future SIP revisions A A A A A A (I): Nonattainment area plan or plan revisions under part D + + + + + + (J)(i): Consultation with government officials A A A A A A (J)(ii): Public notification A A A A A A (J)(iii): PSD A A A A A A (J)(iv): Visibility protection + + + + + + (K): Air quality modeling and data A A A A A A (L): Permitting fees A A A A A A (M): Consultation and participation by affected local entities A A A A A A Key to Table 1: Proposed action on LA infrastructure SIP submittals for various NAAQS A—Approve A*—Approved at an earlier date +—Not germane to infrastructure SIPs No action—EPA is taking no action on this infrastructure requirements NA—Not applicable D—Disapprove

    Based upon review of the state's infrastructure SIP submissions and relevant statutory and regulatory authorities and provisions referenced in these submissions or referenced in Louisiana's SIP, EPA believes that Louisiana has the infrastructure in place to address all applicable required elements of sections 110(a)(1) and (2) (except as noted in table above) to ensure that the 2006 PM2.5, 2008 Pb, 2008 O3, 2010 NO2, 2010 SO2, and 2012 PM2.5 NAAQS are implemented in the state.

    IV. Statutory and Executive Order Reviews

    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 proposes to approve state law as meeting Federal requirements and does not impose additional requirements beyond those imposed by state law. For that reason, this action:

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

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

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

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

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

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

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

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

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

    The SIP is not approved to apply on any Indian reservation land or in any other area where EPA or an Indian tribe has demonstrated that a tribe has jurisdiction. In those areas of Indian country, the proposed rule does not have tribal implications and will not impose substantial direct costs on tribal governments or preempt tribal law as specified by Executive Order 13175 (65 FR 67249, November 9, 2000).

    List of Subjects in 40 CFR Part 52

    Environmental protection, Air pollution control, Incorporation by reference, Intergovernmental relations, Interstate transport of pollution, Lead, Nitrogen dioxide, Ozone, Particulate matter, Reporting and recordkeeping requirements, Sulfur oxides.

    Authority:

    42 U.S.C. 7401 et seq.

    Dated: May 18, 2016. Ron Curry, Regional Administrator, Region 6.
    [FR Doc. 2016-13032 Filed 6-2-16; 8:45 am] BILLING CODE 6560-50-P
    FEDERAL COMMUNICATIONS COMMISSION 47 CFR Part 1 [MD Docket Nos. 16-166; FCC 16-61] Assessment and Collection of Regulatory Fees for Fiscal Year 2016 AGENCY:

    Federal Communications Commission.

    ACTION:

    Notice of proposed rulemaking.

    SUMMARY:

    In this document, the Federal Communications Commission (Commission) will revise its Schedule of Regulatory Fees in order to recover an amount of $384,012,497 that Congress has required the Commission to collect for fiscal year 2016. Section 9 of the Communications Act of 1934, as amended, provides for the annual assessment and collection of regulatory fees under sections 9(b)(2) and 9(b)(3), respectively, for annual “Mandatory Adjustments” and “Permitted Amendments” to the Schedule of Regulatory Fees.

    DATES:

    Submit comments on or before June 20, 2016, and reply comments on or before July 5, 2016.

    ADDRESSES:

    You may submit comments, identified by MD Docket No. 16-166, by any of the following methods:

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

    Federal Communications Commission's Web site: http://www.fcc.gov/cgb/ecfs. Follow the instructions for submitting comments.

    • People with Disabilities: Contact the FCC to request reasonable accommodations (accessible format documents, sign language interpreters, CART, etc.) by email: [email protected] or phone: 202-418-0530 or TTY: 202-418-0432.

    Email: [email protected] Include MD Docket No. 16-166 in the subject line of the message.

    Mail: Commercial overnight mail (other than U.S. Postal Service Express Mail, and Priority Mail, must be sent to 9300 East Hampton Drive, Capitol Heights, MD 20743. U.S. Postal Service first-class, Express, and Priority mail should be addressed to 445 12th Street SW., Washington, DC 20554.

    For detailed instructions for submitting comments and additional information on the rulemaking process, see the SUPPLEMENTARY INFORMATION section of this document.

    FOR FURTHER INFORMATION CONTACT:

    Roland Helvajian, Office of Managing Director at (202) 418-0444.

    SUPPLEMENTARY INFORMATION:

    This is a summary of the Commission's Notice of Proposed Rulemaking (NPRM), FCC 16-61, MD Docket No. 16-166, adopted on May 18, 2016, and released on May 19, 2016. The full text of this document is available for inspection and copying during normal business hours in the FCC Reference Center, 445 12th Street SW., Room CY-A257, Portals II, Washington, DC 20554, and may also be purchased from the Commission's copy contractor, BCPI, Inc., Portals II, 445 12th Street SW., Room CY-B402, Washington, DC 20554. Customers may contact BCPI, Inc. via their Web site, http://www.bcpi.com, or call 1-800-378-3160. This document is available in alternative formats (computer diskette, large print, audio record, and braille). Persons with disabilities who need documents in these formats may contact the FCC by email: [email protected] or phone: 202-418-0530 or TTY: 202-418-0432.

    I. Procedural Matters A. Ex Parte Rules Permit-But-Disclose Proceeding

    1. This Notice of Proposed Rulemaking (FY 2016 NPRM) shall be treated as a “permit-but-disclose” proceeding in accordance with the Commission's ex parte rules. Persons making ex parte presentations must file a copy of any written presentation or a memorandum summarizing any oral presentation within two business days after the presentation (unless a different deadline applicable to the Sunshine period applies). Persons making oral ex parte presentations are reminded that memoranda summarizing the presentation must list all persons attending or otherwise participating in the meeting at which the ex parte presentation was made, and summarize all data presented and arguments made during the presentation. If the presentation consisted in whole or in part of the presentation of data or arguments already reflected in the presenter's written comments, memoranda, or other filings in the proceeding, the presenter may provide citations to such data or arguments in his or her prior comments, memoranda, or other filings (specifying the relevant page and/or paragraph numbers where such data or arguments can be found) in lieu of summarizing them in the memorandum. Documents shown or given to Commission staff during ex parte meetings are deemed to be written ex parte presentations and must be filed consistent with section 1.1206(b). In proceedings governed by section 1.49(f) or for which the Commission has made available a method of electronic filing, written ex parte presentations and memoranda summarizing oral ex parte presentations, and all attachments thereto, must be filed through the electronic comment filing system available for that proceeding, and must be filed in their native format (e.g., .doc, .xml, .ppt, searchable .pdf). Participants in this proceeding should familiarize themselves with the Commission's ex parte rules.

    B. Comment Filing Procedures

    2. Comments and Replies. Pursuant to sections 1.415 and 1.419 of the Commission's rules, 47 CFR 1.415, 1.419, interested parties may file comments and reply comments on or before the dates indicated on the first page of this document. Comments may be filed using: (1) The Commission's Electronic Comment Filing System (ECFS), (2) the Federal Government's eRulemaking Portal, or (3) by filing paper copies. See Electronic Filing of Documents in Rulemaking Proceedings, 63 FR 24121 (1998).

    Electronic Filers: Comments may be filed electronically using the Internet by accessing the ECFS: http://fjallfoss.fcc.gov/ecfs2/ or the Federal eRulemaking Portal: http://www.regulations.gov.

    Paper Filers: Parties who choose to file by paper must file an original and four copies of each filing. If more than one docket or rulemaking number appears in the caption of this proceeding, filers must submit two additional copies for each additional docket or rulemaking number.

    Filings can be sent by hand or messenger delivery, by commercial overnight courier, or by first-class or overnight U.S. Postal Service mail. All filings must be addressed to the Commission's Secretary, Office of the Secretary, Federal Communications Commission.

    All hand-delivered or messenger-delivered paper filings for the Commission's Secretary must be delivered to FCC Headquarters at 445 12th St. SW., Room TW-A325, Washington, DC 20554. The filing hours are 8:00 a.m. to 7:00 p.m. All hand deliveries must be held together with rubber bands or fasteners. Any envelopes must be disposed of before entering the building.

    Commercial overnight mail (other than U.S. Postal Service Express Mail and Priority Mail) must be sent to 9300 East Hampton Drive, Capitol Heights, MD 20743.

    U.S. Postal Service first-class, Express, and Priority mail must be addressed to 445 12th Street SW., Washington, DC 20554.

    People with Disabilities: To request materials in accessible formats for people with disabilities (braille, large print, electronic files, audio format), send an email to [email protected] or call the Consumer & Governmental Affairs Bureau at 202-418-0530 (voice), 202-418-0432 (tty).

    3. Availability of Documents. Comments, reply comments, and ex parte submissions will be available for public inspection during regular business hours in the FCC Reference Center, Federal Communications Commission, 445 12th Street SW., CY-A257, Washington, DC 20554. These documents will also be available free online, via ECFS. Documents will be available electronically in ASCII, Word, and/or Adobe Acrobat.

    4. Accessibility Information. To request information in accessible formats (computer diskettes, large print, audio recording, and Braille), send an email to [email protected] or call the Commission's Consumer and Governmental Affairs Bureau at (202) 418-0530 (voice), (202) 418-0432 (TTY). This document can also be downloaded in Word and Portable Document Format (“PDF”) at: http://www.fcc.gov.

    C. Initial Regulatory Flexibility Analysis

    5. An initial regulatory flexibility analysis (IRFA) is contained in this document. Comments to the IRFA must be identified as responses to the IRFA and filed by the deadlines for comments on this NPRM. The Commission will send a copy of this NPRM, including the IRFA, to the Chief Counsel for Advocacy of the Small Business Administration.

    D. Initial Paperwork Reduction Act

    6. This document does not contain new or modified information collection requirements subject to the Paperwork Reduction Act of 1995 (PRA), Public Law 104-13. In addition, therefore, it does not contain any new or modified information collection burden for small business concerns with fewer than 25 employees, pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4).

    II. Introduction

    7. In this Notice of Proposed Rulemaking (NPRM), we seek comment on the Federal Communications Commission's (FCC's or Commission's) proposed regulatory fees for fiscal year (FY) 2016. Specifically, the Commission proposes to collect $384,012,497.00 in regulatory fees as detailed in the proposed fee schedule attached to this NPRM in Table 4. As explained in this NPRM, the proposed fee schedule includes adjustments to the table used to assess regulatory fees on broadcasters.

    III. Background

    8. The Commission is required by Congress to assess regulatory fees each year in an amount that can reasonably be expected to equal the amount of its appropriation.1 Regulatory fees are mandated by Congress and are collected “to recover the costs of . . . enforcement activities, policy and rulemaking activities, user information services, and international activities.” 2 Regulatory fees are to “be derived by determining the full-time equivalent number of employees performing” these activities, “adjusted to take into account factors that are reasonably related to the benefits provided to the payer of the fee by the Commission's activities . . . .” 3 Regulatory fees recover direct costs, such as salary and expenses; indirect costs, such as overhead functions; and support costs, such as rent, utilities, or equipment.4 Regulatory fees also cover the costs incurred in regulating entities that are statutorily exempt from paying regulatory fees,5 entities whose regulatory fees are waived,6 and entities that provide services for which we do not assess regulatory fees.

    1 47 U.S.C. 159(b)(1)(B). The Commission collected $7.67 million above the required regulatory fee target goal in FY 2015, which the Commission deposited into the U.S. Treasury. The cumulative over collection is $98.367 million as of September 30, 2015.

    2 47 U.S.C. 159(a).

    3 47 U.S.C. 159(b)(1)(A).

    4Assessment and Collection of Regulatory Fees for Fiscal Year 2004, Report and Order, 19 FCC Rcd 11662, 11666, para. 11 (2004) (FY 2004 Report and Order).

    5 For example, governmental and nonprofit entities are exempt from regulatory fees under section 9(h) of the Communications Act of 1934, as amended (Communications Act or Act). 47 U.S.C. 159(h); 47 CFR 1.1162.

    6 47 CFR 1.1166.

    9. Congress sets the amount the Commission must collect each year in the Commission's fiscal year appropriations. Section 9(a)(2) of the Communications Act, as amended (Communications Act or Act) requires the Commission to collect fees sufficient to offset the amount appropriated.7 To calculate regulatory fees, the Commission allocates the total collection target across all regulatory fee categories. The allocation of fees to fee categories is based on the Commission's calculation of FTEs 8 in each regulatory fee category. FTEs are classified as “direct” if the employee is in one of the four “core” bureaus; otherwise, that employee is considered an “indirect” FTE.9 The total FTEs for each fee category includes the direct FTEs associated with that category, plus a proportional allocation of indirect FTEs. The Commission then allocates the total amount to be collected among the various regulatory fee categories. Each regulatee within a fee category pays its proportionate share based on an objective measure, e.g., revenues, number of subscribers, or licenses.10

    7 47 U.S.C. 159(a)(2).

    8 One FTE, a “Full Time Equivalent” or “Full Time Employee,” is a unit of measure equal to the work performed annually by a full time person (working a 40 hour workweek for a full year) assigned to the particular job, and subject to agency personnel staffing limitations established by the U.S. Office of Management and Budget.

    9 The core bureaus are the Wireline Competition Bureau (165 FTEs), Wireless Telecommunications Bureau (92 FTEs), Media Bureau (151 FTEs), and part of the International Bureau (24 FTEs), totaling 432 direct FTEs. The indirect FTEs are the employees from the following bureaus and offices: Enforcement Bureau, Consumer & Governmental Affairs Bureau, Public Safety and Homeland Security Bureau, part of the International Bureau, Chairman and Commissioners' offices, Office of the Managing Director, Office of General Counsel, Office of the Inspector General, Office of Communications Business Opportunities, Office of Engineering and Technology, Office of Legislative Affairs, Office of Strategic Planning and Policy Analysis, Office of Workplace Diversity, Office of Media Relations, and Office of Administrative Law Judges, totaling 1,046 indirect FTEs. These totals are as of Oct. 1, 2015 and exclude auctions funded FTEs.

    10See Procedures for Assessment and Collection of Regulatory Fees, Notice of Proposed Rulemaking, 27 FCC Rcd 8458, 8461-62, paras. 8-11 (2012) (FY 2012 NPRM).

    10. The Commission continues to improve the regulatory fee process by ensuring a more equitable distribution of the regulatory fee burden among categories of Commission licensees under the statutory framework in section 9 of the Communications Act. Specifically, in the FY 2013 Report and Order, the Commission adopted updated FTE allocations to more accurately reflect the number of FTEs working on regulation and oversight of the regulatees in the various fee categories; 11 reallocated some FTEs from the International Bureau as “indirect;” 12 combined the UHF and VHF television stations into one regulatory fee category; 13 and created a regulatory fee category that included Internet Protocol Television (IPTV).14 Subsequently, in the FY 2014 Report and Order and FNPRM, the Commission adopted a new fee subcategory (within the Interstate Telecommunications Service Provider (ITSP) category) for toll free numbers; 15 increased the de minimis threshold for annual regulatory fee payors; 16 and eliminated several categories from the regulatory fee schedule.17 In the FY 2015 NPRM and Report and Order, the Commission added a subcategory for Direct Broadcast Satellite (DBS) providers (in the cable television and IPTV regulatory fee category) based on the finding that Media Bureau FTEs work on issues and proceedings that include DBS as well as other multichannel video programming distributors (MVPDs).18 In addition, in the FY 2015 NPRM and Report and Order, we sought comment on revising the regulatory fee schedule for broadcasters.19

    11Assessment and Collection of Regulatory Fees for Fiscal Year 2013, Report and Order, 28 FCC Rcd 12351, 12354-58, paras 10-20 (2013) (FY 2013 Report and Order). This was recommended in a report issued by the Government Accountability Office (GAO) in 2012. See GAO “Federal Communications Commission Regulatory Fee Process Needs to be Updated,” GAO-12-686 (August 2012) (GAO Report) at 36, (available at http://www.gao.gov/products/GAO-12-686).

    12FY 2013 Report and Order, 28 FCC Rcd at 12355-58, paras. 13-20.

    13Id., 28 FCC Rcd at 12361-62, paras. 29-31.

    14Id., 28 FCC Rcd at 12362-63, paras. 32-33.

    15Assessment and Collection of Regulatory Fees for Fiscal Year 2014, Report and Order and Further Notice of Proposed Rulemaking, 29 FCC Rcd 10767, 10777-79, paras. 25-28 (2014) (FY 2014 Report and Order and FNPRM).

    16FY 2014 Report and Order and FNPRM, 29 FCC Rcd at 10774-76, paras. 18-21.

    17 Id., 29 FCC Rcd at 10776-77, paras. 22-24.

    18Assessment and Collection of Regulatory Fees for Fiscal Year 2015, Notice of Proposed Rulemaking, Report and Order, and Order, 30 FCC Rcd 5354, 5364-5373, paras. 28-41 (2015) (FY 2015 NPRM and Report and Order). We also eliminated two additional fee categories. See id., 30 FCC Rcd at 5361-62, paras. 19-22.

    19 Id., 30 FCC Rcd at 5359, para. 13. In the FY 2015 Report and Order and FNPRM, we sought further comment on the broadcast regulatory fees issue and also sought comment on ITTA's proposal to reallocate FTEs in the Wireline Competition Bureau. Assessment and Collection of Regulatory Fees for Fiscal Year 2015, Report and Order and Further Notice of Proposed Rulemaking, 30 FCC Rcd 10268, 10279-282, paras. 27-34 (2015) (FY 2015 Report and Order and FNPRM).

    IV. Discussion A. Notice of Proposed Rulemaking

    11. We propose to collect $384,012,497 in regulatory fees for FY 2016, pursuant to section 9 of the Communications Act.20 Of this amount, we project approximately $21.4 million (5.56 percent of the total FTE allocation) in fees from the International Bureau regulatees; 21 $81.9 million (21.3 percent of the total FTE allocation) in fees from the Wireless Telecommunications Bureau regulatees; 22 $133.97 million (34.95 percent of the total FTE allocation) from the Media Bureau regulatees; 23 and $146.8 million (38.19 percent of the total FTE allocation) from Wireline Competition Bureau regulatees.24

    20 47 U.S.C. 159. The proposed regulatory fee rates for FY 2016 include $339,844,000 for operational expenses and an additional one time amount of $44,168,497 to offset facilities reduction, i.e., reduce our office space footprint and move the FCC office location if necessary. Consolidated Appropriations Act, 2016, Public Law 114-113, Dec. 18, 2015. Due to the facilities reduction, regulatees' aggregate fees by category increased on average by approximately 11-13 percent for 2016.

    21 Includes satellites, earth stations, submarine cable, and bearer circuits.

    22 Includes Commercial Mobile Radio Service (CMRS), CMRS messaging, Broadband Radio Service/Local Multipoint Distribution Service (BRS/LMDS), and multi-year wireless licensees.

    23 Includes AM radio, FM radio, television, low power/FM, cable television and IPTV, DBS, and Cable Television Relay Service (CARS) licenses.

    24 Includes Interstate Telecommunications Service Providers (ITSP) and toll free numbers.

    12. These regulatory fees are mandated by Congress and are collected “to recover the costs of . . . enforcement activities, policy and rulemaking activities, user information services, and international activities.” 25 We seek comment on the proposed regulatory fee schedule in Table 4.

    25 47 U.S.C. 159(a).

    1. DBS Regulatory Fees as a Subcategory in the Cable Television and IPTV Category

    13. This proposed fee schedule includes an updated regulatory fee for DBS, a subcategory in the cable television and IPTV category.26 In 2015, the Commission adopted the initial regulatory fee for DBS, as a subcategory in the cable television and IPTV category, of 12 cents per year per subscriber, or one cent per month.27 At that time, the Commission stated that it would update the rate for FY 2016, as necessary for ensuring an appropriate level of regulatory parity and considering the resources dedicated to this subcategory.28 When the Commission adopted this regulatory fee subcategory for DBS, the Commission observed that numerous regulatory developments had increased the Media Bureau FTE activity involving regulation and oversight of MVPDs, including DBS providers.29 For example, DBS providers (and cable television operators) are permitted to file program access complaints 30 and complaints seeking relief under the retransmission consent good faith rules; 31 DBS providers are subject to MVPD requirements such as those pertaining to program carriage; 32 and they are subject to the requirement to negotiate retransmission consent in good faith.33 In addition, the Commission, in recent years, adopted numerous requirements that apply to all MVPDs, and thus DBS providers, as part of its implementation of the Commercial Advertisement Loudness Mitigation Act (CALM Act),34 the Twenty-First Century Communications and Video Accessibility Act of 2010 (CVAA),35 as well as the Satellite Television Extension and Localism Act (STELA) Reauthorization Act of 2014 (STELAR).36

    26 DBS also pays a regulatory per operational station in geostationary orbit.

    27FY 2015 Report and Order and FNPRM, 30 FCC Rcd at 10276-77, paras. 19-20.

    28Id., 30 FCC Rcd at 10277, para. 20.

    29See FY 2015 NPRM and Report and Order, 30 FCC Rcd at 5367-68, para. 31.

    30 47 U.S.C. 548; 47 CFR 76.1000-1004.

    31 47 U.S.C. 325(b)(1), (3)(C)(ii); 47 CFR 76.65(b).

    32 47 U.S.C. 536; 47 CFR 76.1300-1302.

    33 47 U.S.C. 325(b)(3)(C)(iii); 47 CFR 76.65(a)-(b).

    34See Implementation of the Commercial Advertisement, Loudness Mitigation (CALM) Act, Report and Order, 26 FCC Rcd 17222 (2011) (CALM Act Report and Order).

    35 Public Law 111-260, 124 Stat. 2751 (2010). See also Amendment of Twenty-First Century Communications and Video Accessibility Act of 2010, Public Law 111-265, 124 Stat. 2795 (2010) (making corrections to the CVAA); 47 CFR part 79.

    36 The STELA Reauthorization Act of 2014 (STELAR), Public Law 113-200, 128 Stat. 2059 (2014). STELAR was enacted on December 4, 2014 (H.R. 5728, 113th Cong.). Commission work on implementation of the Act was immediate. See, e.g., Implementation of Sections 101, 103 and 105 of the STELA Reauthorization Act of 2014, Order, 30 FCC Rcd 2380 (2015) (implementing certain STELAR provisions under the “good cause” exception to the Administrative Procedure Act); Amendment to the Commission's Rules Concerning Market Modification, Implementation of Section 102 of the STELA Reauthorization Act of 2014, Report and Order, 30 FCC Rcd 10406 (2015) (adopting satellite television market modification rules to enable satellite carriers, cable operators, and commercial television stations to better serve the interests of their local communities); Implementation of Section 103 of the STELA Reauthorization Act of 2014, Notice of Proposed Rulemaking, 30 FCC Rcd 10327 (2015) (seeking comment on potential updates to the “totality of the circumstances” test for good faith negotiation of retransmission consent); Final Report of the DSTAC, available at https://transition.fcc.gov/dstac/dstac-report-final-08282015.pdf; “Media Bureau Seeks Comment on DSTAC Report,” Public Notice, DA 15-982, 2015 WL 5164960 (MB 2015); “Media Bureau Seeks Comment for Report Required by the STELA Reauthorization Act of 2014,” Public Notice, 30 FCC Rcd 1904 (2015) (seeking information for a report to Congress on designated market areas and considerations for fostering increased localism).

    14. FY 2015 was the first time the Commission assessed a regulatory fee for DBS based on Media Bureau FTEs. At that time, the Commission concluded an initial rate of 12 cents per subscriber per year was a sensible fee supported by data and analysis for FY 2015.37 In adopting the regulatory fee for DBS as a subcategory of cable television and IPTV category, the Commission explained that “although DBS is not identical to cable television and IPTV, the services all receive oversight and regulation as a result of the work of Media Bureau FTEs on MVPD issues. The burden imposed on the Commission is therefore similar.” 38 At the same time, the Commission also explained that it would examine the appropriate allocation between and among MVPD regulatees in the coming years as the Commission implemented the new DBS fee.39 Such examination is consistent with a report issued by the Government Accountability Office (GAO) in 2012, which observed it is important for the Commission to “regularly update analyses to ensure that fees are set based on relevant information.” 40

    37See FY 2015 Report and Order and FNPRM, 30 FCC Rcd at 10276-77, para. 20. The agency is not required to calculate its costs with “scientific precision.” Central & Southern Motor Freight Tariff Ass'n v. United States, 777 F.2d 722, 736 (D.C. Cir. 1985). Reasonable approximations will suffice. Id.; Mississippi Power & Light, 601 F.2d 223, 232 (5th Cir. 1979); National Cable Television Ass'n v. FCC, 554 F.2d 1094, 1105 (D.C. Cir. 1976).

    38FY 2015 NPRM and Report and Order, 30 FCC Rcd at 5369, para. 33.

    39FY 2015 NPRM and Report and Order, 30 FCC Rcd at 5367-68, para. 34, n.129 (The Commission explained that “[e]ven when an industry has oversight generally by one organizational unit within the Commission, we are sensitive to the fact that balance between members of the same industry may require adjustments to FTE allocations.”).

    40 GAO Report at 12.

    15. In addition to the activities described in our FY 2015 regulatory fee proceeding, DBS, along with other MVPDs, continues to receive oversight and regulation as a result of the work of Media Bureau FTEs. For example, the Commission recently adopted a Report and Order requiring cable operators, DBS providers, and certain other licensees to post their public file documents to the FCC-hosted online database.41 In addition, the Commission is currently reviewing a proposal by Chairman Wheeler to unlock the set-top box of cable and DBS operators.42 Thus, for reasons similar to those discussed in the FY 2015 NPRM and Report and Order, 43 and based on the Commission's analysis of the resources dedicated to this subcategory, including the resources dedicated to the pending portfolio of MVPD proceedings, the Commission proposes to revise the DBS fee rate. Specifically, in this FY 2016 regulatory fee proceeding, the Commission seeks comment on a higher regulatory fee rate of 27 cents per subscriber per year for FY 2016, as set forth in the proposed fee schedule. This fee includes a 24 cent per subscriber baseline with a proportional adjustment of three cents per subscriber associated with the Commission's facilities reduction costs.

    41Expansion of Online Public File Obligations to Cable and Satellite TV Operators and Broadcast and Satellite Radio Licensees, Memorandum, Opinion and Order, FCC 16-4, 2016 WL 380814 (released January 29, 2016).

    42 “Expanding Consumer Choice in the Video Marketplace” (January 28, 2016), available at https://www.fcc.gov/news-events/blog/2016/01/28/expanding-consumer-choice-video-marketplace.

    43FY 2015 NPRM and Report and Order, 30 FCC Rcd at 5367-5373, paras. 31-41.

    2. Broadcaster Regulatory Fees

    16. The Commission assesses regulatory fees on radio broadcasters based on type and class of service and on the population served. Upon occasion, the Commission makes adjustments to the methodology for assessing regulatory fees on radio broadcasters. For example, concerning population served, the Commission adopted a methodology that relied on the radio station's calculated field strength signal contour overlaid upon U.S. Census data to obtain an estimate of the population coverage for each station.44 Subsequently, licensees complained to the Commission that the contours exaggerated actual market areas and populations served. The Commission addressed these concerns through revising the methodology for calculating the fees.45 Similarly, in 2003, due to a trend toward more powerful stations and general increases in the overall population, an increasing number of stations were grouped in the one million-plus population category of the grid and the Commission expanded the AM and FM radio station grid to include wider population thresholds and extended the population category to an amount “greater than three million.” 46

    44Assessment and Collection of Regulatory Fees for Fiscal Year 1997, Report and Order, 12 FCC Rcd 17161, 17179-17184, paras. 47-56 (1997).

    45Assessment and Collection of Regulatory Fees for Fiscal Year 1998, Report and Order, 13 FCC Rcd 19820, 19830-33, paras. 31-41 (1998).

    46Assessment and Collection of Regulatory Fees for Fiscal Year 2003, Report and Order, 18 FCC Rcd 15985, 15986-87, paras. 4-5 (2003).

    17. In the FY 2015 Report and Order and FNPRM, the Commission proposed to include a higher population row in the table for AM and FM broadcasters, i.e., to divide broadcasters that serve 3,000,001-6,000,000 from those that have a higher population coverage.47 Similarly in the FY 2015 Report and Order and FNPRM, the Commission also proposed to standardize the incremental increase in fees as the population served increases 48 and to more consistently assess fees based on the type and class of service.49 No comments were received by the Commission concerning this proposal. The Commission now tentatively concludes adopting these proposals will make the regulatory fees for AM and FM radio more rational and address, in part, the problem of a large number of stations in the highest grid.50 The Commission seeks comment on the following proposed table of regulatory fees for AM and FM radio broadcasters, which includes fees based on the adoption of both options.

    47FY 2015 Report and Order and FNPRM, 30 FCC Rcd at 10280, para. 28.

    48Id. Specifically, we sought comment on standardizing the incremental increase in fees as radio broadcasters increase the population they serve, such as by requiring that fee adjustments between tiers monotonically increase as the population served increases. Id.

    49Id. We sought comment on assessing fees based on the relative type and class of service, such as by assessing FM class B, C, C0, C1, & C2 stations at twice the rate of AM class C stations, and FM class A, B1, & C3 stations assessed at 75 percent more than AM class C stations. For AM stations, we sought comment on assessing AM class A stations at 60 percent more, AM class B stations at 15 percent more, and AM class D stations at 10 percent more than AM class C stations. Id.

    50FY 2015 Report and Order and FNPRM, 30 FCC Rcd at 10279-280, paras. 27-28.

    Table 1 FY 2016 Radio station regulatory fees
  • (proposed)
  • Population served AM Class A AM Class B AM Class C AM Class D FM Classes
  • A, B1 & C3
  • FM Classes
  • B, C, C0,
  • C1 & C2
  • <=25,000 $1,100 $795 $690 $760 $1,200 $1,375 25,001-75,000 1,650 1,200 1,025 1,150 1,800 2,050 75,001-150,000 2,200 1,600 1,375 1,525 2,400 2,750 150,001-500,000 3,300 2,375 2,075 2,275 3,600 4,125 500,001-1,200,000 5,500 3,975 3,450 3,800 6,000 6,875 1,200,001-3,000,00 8,250 5,950 5,175 5,700 9,000 10,300 3,000,001-6,000,00 11,000 7,950 6,900 7,600 12,000 13,750 >6,000,000 13,750 9,950 8,625 9,500 15,000 17,175

    18. Concerning television broadcasters, in the FY 2015 Report and Order and FNPRM, the Commission proposed to readjust the table to restore the traditional determination that Top 10 stations should pay about twice what stations in markets 26-50 pay.51 The Commission did not receive comments on this proposal. At this time, the Commission tentatively concludes that this proposal will make the regulatory fees for television broadcasters more rational. Accordingly, the Commission seeks comment on the regulatory fees for television broadcasters as set forth in Table 4.

    51FY 2015 Report and Order and FNPRM, 30 FCC Rcd at 10280-81, para. 29.

    Table 2 FY 2016 Television station regulatory fees
  • (proposed)
  • Digital TV (47 CFR part 73) VHF and UHF commercial FY 2015
  • Fee rates
  • FY 2016
  • Proposed fee rates
  • Markets 1-10 $46,825 $60,775 Markets 11-25 43,200 45,750 Markets 26-50 27,625 30,575 Markets 51-100 16,275 15,225 Remaining Markets 4,850 5,000 Construction Permits 4,850 5,000

    19. The Commission also recognizes that the incentive auction scheduled for 2016 is a substantial event for the television broadcast industry. As a result, in the FY 2015 Report and Order and FNPRM, the Commission sought comment on whether, when, and how the Commission should adjust its methodology for assessing regulatory fees on television stations to respond to such potential changed circumstances consistent with the provisions of section 9 of the Communications Act.52 While the Commission received comments on the issue,53 it is too early to revise our regulatory fee apportionment because of the uncertainty in events that have yet to happen. The Commission intends to consider any changed circumstances due to the incentive auction as part of the FY 2017 regulatory fee proceeding.

    52FY 2015 Report and Order and FNPRM, 30 FCC Rcd at 10281, para. 30.

    53 NAB Comments at 2-7.

    3. International Services: Terrestrial and Satellite Services

    20. Facilities-based common carriers must pay regulatory fees for terrestrial and satellite International Bearer Circuits (IBCs) active (used or leased) as of December 31 of the prior year in any terrestrial or satellite transmission facility for the provision of service to an end user or resale carrier.54 In the FY 2015 Report and Order and FNPRM, the Commission asked facilities-based common carriers to review their reporting processes to ensure that they accurately calculate and report IBCs.55 The Commission reminded facilities-based common carriers that they must include all common carrier circuits used by themselves or their affiliates when calculating the number of active circuits. The Commission also indicated that we will review the processes for reporting IBCs in the near future to ensure that all carriers are reporting IBCs in the same manner, consistent with our rules. In this regard, the Commission seeks comment on how we can ensure that all providers are calculating and reporting IBCs in the same manner. What criteria do providers use to distinguish common carrier terrestrial circuits from non-common carrier terrestrial circuits for regulatory fee purposes?

    54See para. 22 infra.

    55FY 2015 Report and Order and FNPRM, 30 FCC Rcd 10268, 10283-85, para. 40 and n.128.

    21. As the Commission has stated in the past, non-common carrier terrestrial circuits play an important role in the provision of international services through microwave and fiber links across the U.S.-Canada and U.S.-Mexico borders, and the Commission regularly engages with counterparts in Canada and Mexico on a wide range of issues related to cross-border communications.56 In 2009, the Commission explored whether carriers should be assessed regulatory fees for their terrestrial non-common carrier circuits, but declined to do so at that time because of the “complexity of the legal, policy and equity issues involved.” 57 Since that time, the telecommunications industry and Commission's rules have evolved, and the Commission now seeks comment on whether it would be more equitable to no longer distinguish common carrier terrestrial circuits from non-common carrier terrestrial circuits for regulatory fee purposes. If the Commission requires carriers providing international service over terrestrial circuits to pay IBC regulatory fees for their non-common carrier circuits, what is the least burdensome methodology for calculating fees? For example, should the Commission require carriers to report the total amount of international revenue rather than the number of circuits? How do carriers identify their international revenues? How can the Commission ensure carriers are accurately reporting both common carrier and non-common carrier terrestrial circuits? Finally, how can the Commission improve the requirements and regulatory treatment of terrestrial and satellite services for purposes of regulatory fees?

    56Assessment and Collection of Regulatory Fees for Fiscal Year 2009, Notice of Proposed Rulemaking and Order, 24 FCC Rcd 5966, 5971, para. 14 (2009).

    57Assessment and Collection of Regulatory Fees for Fiscal Year 2009, Report and Order, 24 FCC Rcd 10301, 10306-307, paras. 16-17 (2009). On March 17, 2009, the Commission adopted in the Submarine Cable Order a new submarine cable bearer circuit methodology that allocates IBC costs among service providers in an equitable and competitively neutral manner, without distinguishing between common carriers and non-common carriers, by assessing a flat per cable landing license fee for all submarine cable systems. Assessment and Collection of Regulatory Fees for Fiscal Year 2008, Second Report and Order, 24 FCC Rcd 4208, 4214-16, paras. 13-17 (2009) (Submarine Cable Order).

    4. Other Regulatory Fee Reform a. ITTA Proposal

    22. In the FY 2015 Report and Order and FNPRM, the Commission sought comment on ITTA's proposals to combine wireless voice and wireline services into the ITSP category 58 or, alternatively, to re-assign certain Wireline Competition Bureau FTEs to other fee categories, for regulatory fee purposes. The Commission also sought comment on adopting a new regulatory fee category for CMRS, as a subcategory of the ITSP regulatory fee category.59 The Commission has had an opportunity to further review ITTA's proposals and, as we explain below, we tentatively conclude that combining the wireline and wireless categories, reassigning Wireline Competition Bureau FTEs to the Wireless Telecommunications Bureau, and/or adopting a new subcategory for CMRS in the ITSP regulatory fee category are not consistent with Commission orders implementing section 9 of the Communications Act.

    58 ITTA Comments at 4-9. See FY 2015 Report and Order and FNPRM, 30 FCC Rcd at 10281-82, paras. 31-34. ITTA had proposed this previously. See, e.g., Assessment and Collection of Regulatory Fees for Fiscal Year 2014, Notice of Proposed Rulemaking, 29 FCC Rcd 6417, 6430-31, paras. 36-39 (2014) (FY 2014 NPRM); Assessment and Collection of Regulatory Fees for Fiscal Year 2013, Notice of Proposed Rulemaking and Further Notice of Proposed Rulemaking, 28 FCC Rcd 7790, 7796, para. 12 (2013) (FY 2013 NPRM); Assessment and Collection of Regulatory Fees for Fiscal Year 2008, Report and Order and Further Notice of Proposed Rulemaking, 24 FCC Rcd 6388, 6404-05, paras. 40-41 (2008) (FY 2008 FNPRM).

    59FY 2015 Report and Order and FNPRM, 30 FCC Rcd at 10282, para. 34. ITTA and ACA argue that such change is supported by the fact that many proceedings in the Wireline Competition Bureau proceedings, and elsewhere, such as those involving universal service, intercarrier compensation, pole attachments, rural call completion, number portability, 911 access, and special access, affect wireless service providers. ITTA Comments at 9-10; ACA Comments at 4-7. CTIA opposes this proposal as arbitrary and capricious as well as in violation of section 9 of the Act. CTIA Comments at 2.

    23. The Commission has stated that “[g]iven the significant implications of reassignment of FTEs in our fee calculation, we make changes to FTE classifications only after performing considerable analysis and finding the clearest case for reassignment.” 60 In this instance, ITTA contends that the Wireline Competition Bureau FTEs working on universal service issues and other proceedings benefit categories of service providers other than ITSPs, particularly CMRS providers, and therefore should be considered in calculating the CMRS regulatory fee.61 Based on our own detailed analysis, as well as the fact that the Wireless Telecommunications Bureau assigns its own FTEs to coordinate with the Wireline Competition Bureau on relevant wireless issues, we tentatively conclude that a clear case for reassignment of Wireline Competition Bureau FTEs to the Wireless Telecommunications Bureau is not demonstrated in this instance. Our analysis of the Wireline Competition Bureau FTE work on wireline issues that also affect the CMRS industry does not support adopting a new subcategory for CMRS in the ITSP regulatory fee category—and thus assessing regulatory fees on CMRS based on both Wireless Telecommunications Bureau FTEs and Wireline Competition Bureau FTEs, as ITTA proposes.62 Further, ITTA's proposal to combine these regulatory fee categories does not appear to address the substantial differences between the services in terms of regulatory oversight by the two bureaus. Thus, at this juncture, the Commission does not find that the “clearest case of reassignment” exists based on the considerable analysis we have conducted.

    60FY 2013 Report and Order, 28 FCC Rcd at 12357, para. 19. The Commission observed that the International Bureau was a “singular case” because the work of those FTEs “primarily benefits licensees regulated by other bureaus.” Id., 28 FCC Rcd at 12355, para. 14.

    61 ITTA Comments at 10.

    62See Letter from Micah M. Caldwell, ITTA, to Marlene H. Dortch, Secretary, FCC (January 22, 2016).

    24. The Commission nevertheless seeks comment on whether it would be appropriate to allocate some proportion of the direct FTEs that devote time to universal service and/or numbering issues as additional indirect FTEs.63 Based on staff estimates looking back over a 6 to 12 month period, of the 165 FTEs in the Wireline Competition Bureau, approximately seven FTEs work on numbering issues and 52 FTEs work on universal service issues (approximately 16 on the high-cost program, 13 on the schools and libraries program, nine on the Lifeline program for low income consumers (lifeline), seven on the rural healthcare program, and seven on universal service contributions).64 Of the 92 FTEs in the Wireless Telecommunications Bureau, staff estimate that the equivalent of approximately five FTEs work roughly full time on universal service issues (primarily the high-cost program). If we were to reallocate, for regulatory fee purposes, some proportion of the direct FTEs, what should that proportion be? Any proposals should demonstrate policy or legal arguments supporting reallocating some proportion of numbering and/or USF FTEs as indirect. In doing so, the Commission would invite comment on whether some or all of the FTEs that work on universal service contributions, the schools and libraries program, or the rural healthcare program, should be reallocated as indirect FTEs. Should the Commission reallocate some proportion of the FTEs from each bureau that work on the high-cost program, given the participation of non-wireline and wireless regulatees in the Connect America Fund proceedings? What proportion, if any, of the FTEs that work on numbering issues and the lifeline program should the Commission reallocate given that a significant number of regulatees benefiting from those programs are not wireline regulatees? Is there some proportion of these FTEs whose “activities benefit the Commission as a whole and are not specifically focused on [core bureau] regulatees”? 65 Commenters' proposals for FTE reallocation should be consistent with the section 9 requirement that regulatory fees are to “be derived by determining the full-time equivalent number of employees performing” Commission activities, “adjusted to take into account factors that are reasonably related to the benefits provided to the payer of the fee by the Commission's activities . . . .” 66

    63 Currently, indirect FTEs in various bureaus and offices work on universal service issues.

    64 These estimates can vary as discussed above and do not represent an entire fiscal year.

    65FY 2013 NPRM, 28 FCC Rcd at 7803, para. 28.

    66 47 U.S.C. 159(b)(1)(A). (Emphasis added).

    25. The Commission notes that incorrect allocation of FTEs to a particular core bureau may disproportionately impact regulatees given that indirect FTEs are allocated proportionally based on the direct FTE percentage attributable to a particular core bureau. The Commission also notes that any change in the allocation of FTEs necessarily affects the fees paid by payors in all other fee categories. We seek comment on whether this proposal is consistent with section 9 of the Act 67 and with the Commission's allocation policies with respect to direct and indirect FTEs.68 Commenters should also address the Commission's goal of ensuring that regulatory fees are administrable and sustainable.69

    67 Section 9 of the Communications Act requires regulatory fees collected “to recover the costs of . . . enforcement activities, policy and rulemaking activities, user information services, and international activities.” 47 U.S.C. 159(a). The regulatory fees are to “be derived by determining the full-time equivalent number of employees performing” these activities, “adjusted to take into account factors that are reasonably related to the benefits provided to the payer of the fee by the Commission's activities . . . .” 47 U.S.C. 159(b)(1)(A).

    68FY 2013 Report and Order, 28 FCC Rcd at 12354-55, paras. 10-12 (adopting use of current FTE data for purposes of regulatory fee calculations as opposed to 1998 FTE data previously used); id. at 12357-58, paras. 19-20 (“It would be inconsistent with section 9 to delay reallocating the International Bureau FTEs, where the reallocation is clearly warranted, while we engage in painstaking examinations of less clear and more factually complex situations in other bureaus. . . . At the same time, however, we recognize that a reexamination of how FTEs are allocated throughout the Commission is an indispensable part of comprehensively revising the Commission's regulatory fee program.”); FY 2013 NPRM, 28 FCC Rcd at 7793-95, 7796-99, 7803, paras. 7-10, 15-19, 29 (generally explaining prior FTE allocation methodology and proposing methodology changes).

    69FY 2013 Report and Order, 28 FCC Rcd at 12354, para 9.

    b. Earth Stations

    26. In the FY 2014 NPRM, the Commission sought comment on increasing the earth station regulatory fee allocation in order to reflect more appropriately the number of FTEs devoted to the regulation and oversight of the earth station portion of the satellite industry.70 In the FY 2014 regulatory fee proceeding, the Commission increased the regulatory fees paid by earth station licensees by approximately 7.5 percent based on our analysis and review of the record.71 In the FY 2015 NPRM and Report and Order, the Commission sought comment on whether to raise the earth station regulatory fees again.72 We concluded, however, that the issue required further analysis, in part because the then-pending part 25 proceeding streamlining the satellite licensing rules might affect the distribution of FTE work.73 An Order was adopted in that proceeding in December 2015, and accordingly it is timely to again seek comment on whether to increase the regulatory fees paid by earth station licensees.74 In this context, we seek comment on EchoStar's proposal to adopt different regulatory fees for different types of earth station licenses.75

    70FY 2014 NPRM, 29 FCC Rcd at 6428, para. 29.

    71See FY 2014 Report and Order, 29 FCC Rcd at 10772-73, para. 12.

    72FY 2015 NPRM and Report and Order, 30 FCC Rcd at 5360, para. 14.

    73FY 2015 NPRM and Report and Order, 30 FCC Rcd at 5360, para. 14.

    74See Comprehensive Review of Licensing and Operating Rules for Satellite Services, Second Report and Order, 30 FCC Rcd 14713 (2015).

    75See EchoStar July 20, 2015 ex parte, filed in MD Docket No. 15-121.

    V. Procedural Matters A. Payment of Regulatory Fees 1. Payments by Check Will Not Be Accepted for Payment of Annual Regulatory Fees

    27. Pursuant to an Office of Management and Budget (OMB) directive,76 the Commission is moving towards a paperless environment, extending to disbursement and collection of select federal government payments and receipts.77 Last year the Commission stopped accepting checks (including cashier's checks and money orders) and the accompanying hardcopy forms (e.g., Forms 159, 159-B, 159-E, 159-W) for the payment of regulatory fees.78 This new paperless procedure requires that all payments be made by online Automated Clearing House (ACH) payment, online credit card, or wire transfer. Any other form of payment (e.g., checks, cashier's checks, or money orders) will be rejected. For payments by wire, a Form 159-E should still be transmitted via fax so that the Commission can associate the wire payment with the correct regulatory fee information. This change affects all payments of regulatory fees.79

    76 Office of Management and Budget (OMB) Memorandum M-10-06, Open Government Directive, December 8, 2009; see also http://www.whitehouse.gov/the-press-office/2011/06/13/executive-order-13576-delivering-efficient-effective-and-accountable-gov.

    77See U.S. Department of the Treasury, Open Government Plan 2.1, September 2012.

    78FY 2015 Report and Order and FNPRM, 30 FCC Rcd at 10282-83, para. 35. See 47 CFR 1.1158.

    79 Payors should note that this change will mean that to the extent certain entities have to date paid both regulatory fees and application fees at the same time via paper check, they will no longer be able to do so as the regulatory fees payment via paper check will no longer be accepted.

    2. Revised Credit Card Transaction Levels

    28. Since June 1, 2015, in accordance with U.S. Treasury Announcement No. A-2014-04 (July 2014), the amount that can be charged on a credit card for transactions with federal agencies has been reduced to $24,999.99.80 Transactions greater than $24,999.99 will be rejected. This limit applies to single payments or bundled payments of more than one bill. Multiple transactions to a single agency in one day may be aggregated and treated as a single transaction subject to the $24,999.99 limit. Customers who wish to pay an amount greater than $24,999.99 should consider available electronic alternatives such as Visa or MasterCard debit cards, ACH debits from a bank account, and wire transfers. Each of these payment options is available after filing regulatory fee information in Fee Filer. Further details will be provided regarding payment methods and procedures at the time of FY 2016 regulatory fee collection in Fact Sheets, available at https://www.fcc.gov/regfees.

    80 Customers who owe an amount on a bill, debt, or other obligation due to the federal government are prohibited from splitting the total amount due into multiple payments. Splitting an amount owed into several payment transactions violates the credit card network and Fiscal Service rules. An amount owed that exceeds the Fiscal Service maximum dollar amount, $24,999.99, may not be split into two or more payment transactions in the same day by using one or multiple cards. Also, an amount owed that exceeds the Fiscal Service maximum dollar amount may not be split into two or more transactions over multiple days by using one or more cards.

    3. De Minimis Regulatory Fees

    29. Regulatees whose total FY 2016 annual regulatory fee liability, including all categories of fees for which payment is due, is $500 or less are exempt from payment of FY 2016 regulatory fees. The de minimis threshold applies only to filers of annual regulatory fees (not regulatory fees paid through multi-year filings), and it is not a permanent exemption. Each regulatee will need to reevaluate their total fee liability each fiscal year to determine whether they meet the de minimis exemption.

    4. Standard Fee Calculations and Payment Dates

    30. The Commission will accept fee payments made in advance of the window for the payment of regulatory fees. The responsibility for payment of fees by service category is as follows:

    Media Services: Regulatory fees must be paid for initial construction permits that were granted on or before October 1, 2015 for AM/FM radio stations, VHF/UHF full service television stations, and satellite television stations. Regulatory fees must be paid for all broadcast facility licenses granted on or before October 1, 2015. For providers of Direct Broadcast Satellite (DBS) service, regulatory fees should be paid based on a subscriber count on or about December 31, 2015. In instances where a permit or license is transferred or assigned after October 1, 2015, responsibility for payment rests with the holder of the permit or license as of the fee due date.

    Wireline (Common Carrier) Services: Regulatory fees must be paid for authorizations that were granted on or before October 1, 2015. In instances where a permit or license is transferred or assigned after October 1, 2015, responsibility for payment rests with the holder of the permit or license as of the fee due date. Audio bridging service providers are included in this category.81 For Responsible Organizations (RespOrgs) that manage Toll Free Numbers (TFN), regulatory fees should be paid on all working, assigned, and reserved toll free numbers as well as toll free numbers in any other status as defined in section 52.103 of the Commission's rules.82 The unit count should be based on toll free numbers managed by RespOrgs on or about December 31, 2015.

    81 Audio bridging services are toll teleconferencing services.

    82 47 CFR 52.103.

    Wireless Services: CMRS cellular, mobile, and messaging services (fees based on number of subscribers or telephone number count): Regulatory fees must be paid for authorizations that were granted on or before October 1, 2015. The number of subscribers, units, or telephone numbers on December 31, 2015 will be used as the basis from which to calculate the fee payment. In instances where a permit or license is transferred or assigned after October 1, 2015, responsibility for payment rests with the holder of the permit or license as of the fee due date.

    Wireless Services, Multi-year fees: The first eight regulatory fee categories in our Schedule of Regulatory Fees pay “small multi-year wireless regulatory fees.” Entities pay these regulatory fees in advance for the entire amount period covered by the five-year or ten-year terms of their initial licenses, and pay regulatory fees again only when the license is renewed or a new license is obtained. We include these fee categories in our rulemaking (see Table 3) to publicize our estimates of the number of “small multi-year wireless” licenses that will be renewed or newly obtained in FY 2016.

    Multichannel Video Programming Distributor Services (cable television operators and CARS licensees): Regulatory fees must be paid for the number of basic cable television subscribers as of December 31, 2015.83 Regulatory fees also must be paid for CARS licenses that were granted on or before October 1, 2015. In instances where a permit or license is transferred or assigned after October 1, 2015, responsibility for payment rests with the holder of the permit or license as of the fee due date.

    83 Cable television system operators should compute their number of basic subscribers as follows: Number of single family dwellings + number of individual households in multiple dwelling unit (apartments, condominiums, mobile home parks, etc.) paying at the basic subscriber rate + bulk rate customers + courtesy and free service. Note: Bulk-Rate Customers = Total annual bulk-rate charge divided by basic annual subscription rate for individual households. Operators may base their count on “a typical day in the last full week” of December 2015, rather than on a count as of December 31, 2015.

    International Services: Regulatory fees must be paid for (1) earth stations and (2) geostationary orbit space stations and non-geostationary orbit satellite systems that were licensed and operational on or before October 1, 2015. In instances where a permit or license is transferred or assigned after October 1, 2015, responsibility for payment rests with the holder of the permit or license as of the fee due date.

    International Services: (Submarine Cable Systems): Regulatory fees for submarine cable systems are to be paid on a per cable landing license basis based on circuit capacity as of December 31, 2015. In instances where a license is transferred or assigned after October 1, 2015, responsibility for payment rests with the holder of the license as of the fee due date. For regulatory fee purposes, the allocation in FY 2016 will remain at 87.6 percent for submarine cable and 12.4 percent for satellite/terrestrial facilities.

    International Services: (Terrestrial and Satellite Services): Regulatory fees for Terrestrial and Satellite International Bearer Circuits (IBCs) are to be paid by facilities-based common carriers that have active (used or leased) international bearer circuits as of December 31, 2015 in any terrestrial or satellite transmission facility for the provision of service to an end user or resale carrier. When calculating the number of such active circuits, the facilities-based common carriers must include circuits used by themselves or their affiliates. In addition, non-common carrier satellite operators must pay a fee for each circuit they and their affiliates hold and each circuit sold or leased to any customer, other than an international common carrier authorized by the Commission to provide U.S. international common carrier services. For these purposes, “active circuits” include backup and redundant circuits as of December 31, 2015. Whether circuits are used specifically for voice or data is not relevant for purposes of determining that they are active circuits.84 In instances where a permit or license is transferred or assigned after October 1, 2015, responsibility for payment rests with the holder of the permit or license as of the fee due date. For regulatory fee purposes, the allocation in FY 2016 will remain at 87.6 percent for submarine cable and 12.4 percent for satellite/terrestrial facilities.85

    84 We encourage terrestrial and satellite service providers to seek guidance from the International Bureau's Telecommunications and Analysis Division to verify their particular IBC reporting processes to ensure that their calculation methods comply with our rules.

    85 We remind facilities-based common carriers to review their reporting processes to ensure that they accurately calculate and report IBCs.

    B. Commercial Mobile Radio Service (CMRS) Cellular and Mobile Services Assessments

    31. The Commission will compile data from the Numbering Resource Utilization Forecast (NRUF) report that is based on “assigned” telephone number (subscriber) counts that have been adjusted for porting to net Type 0 ports (“in” and “out”).86 This information of telephone numbers (subscriber count) will be posted on the Commission's electronic filing and payment system (Fee Filer) along with the carrier's Operating Company Numbers (OCNs).

    86See Assessment and Collection of Regulatory Fees for Fiscal Year 2005, Report and Order and Order on Reconsideration, 20 FCC Rcd 12259, 12264, paras. 38-44 (2005).

    32. A carrier wishing to revise its telephone number (subscriber) count can do so by accessing Fee Filer and follow the prompts to revise their telephone number counts. Any revisions to the telephone number counts should be accompanied by an explanation or supporting documentation.87 The Commission will then review the revised count and supporting documentation and either approve or disapprove the submission in Fee Filer. If the submission is disapproved, the Commission will contact the provider to afford the provider an opportunity to discuss its revised subscriber count and/or provide additional supporting documentation. If we receive no response from the provider, or we do not reverse our initial disapproval of the provider's revised count submission, the fee payment must be based on the number of subscribers listed initially in Fee Filer. Once the timeframe for revision has passed, the telephone number counts are final and are the basis upon which CMRS regulatory fees are to be paid. Providers can view their final telephone counts online in Fee Filer. A final CMRS assessment letter will not be mailed out.

    87 In the supporting documentation, the provider will need to state a reason for the change, such as a purchase or sale of a subsidiary, the date of the transaction, and any other pertinent information that will help to justify a reason for the change.

    33. Because some carriers do not file the NRUF report, they may not see their telephone number counts in Fee Filer. In these instances, the carriers should compute their fee payment using the standard methodology that is currently in place for CMRS Wireless services (i.e. , compute their telephone number counts as of December 31, 2015), and submit their fee payment accordingly. Whether a carrier reviews its telephone number counts in Fee Filer or not, the Commission reserves the right to audit the number of telephone numbers for which regulatory fees are paid. In the event that the Commission determines that the number of telephone numbers that are paid is inaccurate, the Commission will bill the carrier for the difference between what was paid and what should have been paid.

    VI. Additional Tables Table 3—Calculation of FY 2016 Revenue Requirements and Pro-Rata Fees [Regulatory fees for the first seven categories below are collected by the Commission in advance to cover the term of the license and are submitted at the time the application is filed] Fee category FY 2016 payment units Years FY 2015
  • revenue
  • estimate
  • Prorated FY 2016 revenue requirement Computed FY 2016 reg. fee Rounded
  • FY 2016
  • reg. fee
  • Expected
  • FY 2016
  • revenue
  • PLMRS (Exclusive Use) 2,500 10 546,000 625,938 25 25 625,000 PLMRS (Shared use) Includes Rural Radio Service (47 CFR part 22) 31,100 10 3,100,000 3,114,665 10 10 3,110,000 Microwave 12,500 10 2,520,000 3,129,688 25 25 3,125,000 Marine (Ship) 6,900 10 945,000 1,036,553 15 15 1,035,000 Aviation (Aircraft) 4,700 10 420,000 470,705 10 10 470,000 Marine (Coast) 480 10 171,500 192,288 40 40 192,000 Aviation (Ground) 1,100 10 180,000 220,330 20 20 220,000 AM Class A4 66 1 281,125 314,451 4,764 4,775 315,150 AM Class B4 1,535 1 3,499,125 3,893,459 2,536 2,525 3,875,875 AM Class C4 889 1 1,244,600 1,409,299 1,585 1,575 1,400,175 AM Class D4 1,492 1 4,103,000 4,607,579 3,088 3,100 4,625,200 FM Classes A, B1 & C3 4 3,122 1 8,613,000 9,652,908 3,092 3,100 9,678,200 FM Classes B, C, C0, C1 & C2 4 3,139 1 10,607,625 11,826,839 3,768 3,775 11,849,725 AM Construction Permits 1 15 1 17,110 10,366 691 690 10,350 FM Construction Permits1 179 1 136,500 215,122 1,202 1,200 214,800 Satellite TV 128 1 200,025 224,336 1,753 1,750 224,000 Digital TV Markets 1-10 139 1 6,274,550 8,446,540 60,766 60,775 8,447,725 Digital TV Markets 11-25 139 1 5,918,400 6,358,412 45,744 45,750 6,359,250 Digital TV Markets 26-50 181 1 5,000,125 5,532,175 30,565 30,575 5534,075 Digital TV Markets 51-100 283 1 4,605,825 4,311,203 15,234 15,225 4,308,675 Digital TV Remaining Markets 365 1 1,838,150 1,827,738 5,008 5,000 1,825,000 Digital TV Construction Permits1 3 1 9,700 15,023 5,000 5,000 15,000 LPTV/Translators/Boosters/Class A TV 3,924 1 1,601,600 1,788,098 456 455 1,785,420 CARS Stations 285 1 198,000 221,206 776 775 220,875 Cable TV Systems, including IPTV 64,100,000 1 61,920,000 64,196,150 1.0015 1.00 64,100,000 Direct Broadcast Satellite (DBS) 34,000,000 1 4,080,000 9,193,770 .2704 .27 9,180,000 Interstate Telecommunication Service Providers $38,400,000,000 1 128,428,000 141,908,544 0.0036955 0.00370 142,080,000 Toll Free Numbers 36,500,000 1 4,380,000 4,752,018 0.1302 0.13 4,745,000 CMRS Mobile Services (Cellular/Public Mobile) 360,000,000 1 60,180,000 72,108,276 0.2003 0.20 72,000,000 CMRS Messag. Services 2,300,000 1 208,000 184,000 0.0800 0.080 184,000 BRS 2 890 1 565,150 645,250 725 725 645,250 LMDS 395 1 238,125 286,375 725 725 286,375 Per 64 kbps Int'l Bearer Circuits Terrestrial (Common) & Satellite (Common & Non-Common) 22,500,000 1 657,000 770,617 .0342 .03 675,000 Submarine Cable Providers (see chart in Appendix B) 3 39.19 1 4,652,576 5,444,038 138,914 138,925 5,444,471 Earth Stations 3,400 1 1,023,000 1,174,760 346 345 1,173,000 Space Stations (Geostationary) 95 1 11,438,400 13,174,858 138,683 138,675 13,174,125 Space Stations (Non-Geostationary) 6 1 792,750 913,068 152,178 152,175 913,050 ****** Total Estimated Revenue to be Collected 340,593,961 384,196,740 384,066,766 ****** Total Revenue Requirement 339,844,000 384,012,497 384,012,497 Difference 749,961 184,243 54,269 Notes on Table 3. 1 The AM and FM Construction Permit revenues and the Digital (VHF/UHF) Construction Permit revenues were adjusted, respectively, to set the regulatory fee to an amount no higher than the lowest licensed fee for that class of service. Reductions in the Digital (VHF/UHF) Construction Permit revenues were also offset by increases in the revenue totals for various Digital television stations by market size, respectively. 2 MDS/MMDS category was renamed Broadband Radio Service (BRS). See Amendment of Parts 1, 21, 73, 74 and 101 of the Commission's Rules to Facilitate the Provision of Fixed and Mobile Broadband Access, Educational and Other Advanced Services in the 2150-2162 and 2500-2690 MHz Bands, Report & Order and Further Notice of Proposed Rulemaking, 19 FCC Rcd 14165, 14169, para. 6 (2004). 3 The chart at the end of Table 4 lists the submarine cable bearer circuit regulatory fees (common and non-common carrier basis) that resulted from the adoption of Assessment and Collection of Regulatory Fees for Fiscal Year 2008, Report and Order and Further Notice of Proposed Rulemaking, 24 FCC Rcd 6388 (2008) and Assessment and Collection of Regulatory Fees for Fiscal Year 2008, Second Report and Order, 24 FCC Rcd 4208 (2009). 4 The fee amounts listed in the column entitled “Rounded New FY 2016 Regulatory Fee” constitute a weighted average media regulatory fee by class of service. The actual FY 2016 regulatory fees for AM/FM radio station are listed on a grid located at the end of Table 4.
    Table 4—Proposed Regulatory Fees FY 2016 Schedule of Regulatory Fees [Regulatory fees for the first eight categories below are collected by the Commission in advance to cover the term of the license and are submitted at the time the application is filed] Fee category Annual
  • regulatory fee
  • (U.S. $'s)
  • PLMRS (per license) (Exclusive Use) (47 CFR part 90) 25 Microwave (per license) (47 CFR part 101) 25 Marine (Ship) (per station) (47 CFR part 80) 15 Marine (Coast) (per license) (47 CFR part 80) 40 Rural Radio (47 CFR part 22) (previously listed under the Land Mobile category) 10 PLMRS (Shared Use) (per license) (47 CFR part 90) 10 Aviation (Aircraft) (per station) (47 CFR part 87) 10 Aviation (Ground) (per license) (47 CFR part 87) 20 CMRS Mobile/Cellular Services (per unit) (47 CFR parts 20, 22, 24, 27, 80 and 90) .20 CMRS Messaging Services (per unit) (47 CFR parts 20, 22, 24 and 90) .08 Broadband Radio Service (formerly MMDS/MDS) (per license) (47 CFR part 27) Local Multipoint Distribution Service (per call sign) (47 CFR, part 101) 725
  • 725
  • AM Radio Construction Permits 690 FM Radio Construction Permits 1,200 Digital TV (47 CFR part 73) VHF and UHF Commercial Markets 1-10 60,775 Markets 11-25 45,750 Markets 26-50 30,575 Markets 51-100 15,225 Remaining Markets 5,000 Construction Permits 5,000 Satellite Television Stations (All Markets) 1,750 Low Power TV, Class A TV, TV/FM Translators & Boosters (47 CFR part 74) 455 CARS (47 CFR part 78) 775 Cable Television Systems (per subscriber) (47 CFR part 76), Including IPTV 1.00 Direct Broadcast Service (DBS) (per subscriber) (as defined by section 602(13) of the Act) .27 Interstate Telecommunication Service Providers (per revenue dollar) .00370 Toll Free (per toll free subscriber) (47 CFR section 52.101 (f) of the rules) .13 Earth Stations (47 CFR part 25) 345 Space Stations (per operational station in geostationary orbit) (47 CFR part 25) also includes DBS Service (per operational station) (47 CFR part 100) 138,675 Space Stations (per operational system in non-geostationary orbit) (47 CFR part 25) 152,175 International Bearer Circuits—Terrestrial/Satellites (per 64KB circuit) .03 Submarine Cable Landing Licenses Fee (per cable system) See Table Below
    FY 2016 Schedule of Regulatory Fees [Table 4 continued] FY 2016 RADIO STATION REGULATORY FEES Population Served AM Class A AM Class B AM Class C AM Class D FM Classes
  • A, B1 & C3
  • FM Classes
  • B, C, C0, C1 & C2
  • <=25,000 $1,100 $795 $690 $760 $1,200 $1,375 25,001-75,000 1,650 1,200 1,025 1,150 1,800 2,050 75,001-150,000 2,200 1,600 1,375 1,525 2,400 2,750 150,001-500,000 3,300 2,375 2,075 2,275 3,600 4,125 500,001-1,200,000 5,500 3,975 3,450 3,800 6,000 6,875 1,200,001-3,000,00 8,250 5,950 5,175 5,700 9,000 10,300 3,000,001-6,000,00 11,000 7,950 6,900 7,600 12,000 13,750 >6,000,000 13,750 9,950 8,625 9,500 15,000 17,175
    FY 2016 SCHEDULE OF REGULATORY FEES [International Bearer Circuits—Submarine Cable (Table 4 continued)] Submarine Cable Systems
  • (capacity as of December 31, 2015)
  • Fee amount
    < 2.5 Gbps $8,675 2.5 Gbps or greater, but less than 5 Gbps 17,375 5 Gbps or greater, but less than 10 Gbps 34,725 10 Gbps or greater, but less than 20 Gbps 69,475 20 Gbps or greater 138,925
    Table 5—Sources of Payment Unit Estimates for FY 2016

    In order to calculate individual service fees for FY 2016, we adjusted FY 2015 payment units for each service to more accurately reflect expected FY 2016 payment liabilities. We obtained our updated estimates through a variety of means. For example, we used Commission licensee data bases, actual prior year payment records and industry and trade association projections when available. The databases we consulted include our Universal Licensing System (ULS), International Bureau Filing System (IBFS), Consolidated Database System (CDBS) and Cable Operations and Licensing System (COALS), as well as reports generated within the Commission such as the Wireless Telecommunications Bureau's Numbering Resource Utilization Forecast.

    We sought verification for these estimates from multiple sources and, in all cases, we compared FY 2016 estimates with actual FY 2015 payment units to ensure that our revised estimates were reasonable. Where appropriate, we adjusted and/or rounded our final estimates to take into consideration the fact that certain variables that impact on the number of payment units cannot yet be estimated with sufficient accuracy. These include an unknown number of waivers and/or exemptions that may occur in FY 2016 and the fact that, in many services, the number of actual licensees or station operators fluctuates from time to time due to economic, technical, or other reasons. When we note, for example, that our estimated FY 2016 payment units are based on FY 2015 actual payment units, it does not necessarily mean that our FY 2016 projection is exactly the same number as in FY 2015. We have either rounded the FY 2016 number or adjusted it slightly to account for these variables.

    Fee category Sources of payment unit estimates Land Mobile (All), Microwave, Marine (Ship & Coast), Aviation (Aircraft & Ground), Domestic Public Fixed Based on Wireless Telecommunications Bureau (WTB) projections of new applications and renewals taking into consideration existing Commission licensee data bases. Aviation (Aircraft) and Marine (Ship) estimates have been adjusted to take into consideration the licensing of portions of these services on a voluntary basis. CMRS Cellular/Mobile Services Based on WTB projection reports, and FY 2015 payment data. CMRS Messaging Services Based on WTB reports, and FY 2015 payment data. AM/FM Radio Stations Based on CDBS data, adjusted for exemptions, and actual FY 2015 payment units. Digital TV Stations (Combined VHF/UHF units) Based on CDBS data, adjusted for exemptions, and actual FY 2015 payment units. AM/FM/TV Construction Permits Based on CDBS data, adjusted for exemptions, and actual FY 2015 payment units. LPTV, Translators and Boosters, Class A Television Based on CDBS data, adjusted for exemptions, and actual FY 2015 payment units. BRS (formerly MDS/MMDS) Based on WTB reports and actual FY 2015 payment units. LMDS Based on WTB reports and actual FY 2015 payment units. Cable Television Relay Service (CARS) Stations Based on data from Media Bureau's COALS database and actual FY 2015 payment units. Cable Television System Subscribers, Including IPTV Subscribers Based on publicly available data sources for estimated subscriber counts and actual FY 2015 payment units. Interstate Telecommunication Service Providers Based on FCC Form 499-Q data for the four quarters of calendar year 2015, the Wireline Competition Bureau projected the amount of calendar year 2015 revenue that will be reported on 2016 FCC Form 499-A worksheets in April 2016. Earth Stations Based on International Bureau (IB) licensing data and actual FY 2015 payment units. Space Stations (GSOs & NGSOs) Based on IB data reports and actual FY 2015 payment units. International Bearer Circuits Based on IB reports and submissions by licensees, adjusted as necessary. Submarine Cable Licenses Based on IB license information. Table 6—Factors, Measurements, and Calculations That Determines Station Signal Contours and Associated Population Coverages AM Stations

    For stations with nondirectional daytime antennas, the theoretical radiation was used at all azimuths. For stations with directional daytime antennas, specific information on each day tower, including field ratio, phase, spacing, and orientation was retrieved, as well as the theoretical pattern root-mean-square of the radiation in all directions in the horizontal plane (RMS) figure (milliVolt per meter (mV/m) @1 km) for the antenna system. The standard, or augmented standard if pertinent, horizontal plane radiation pattern was calculated using techniques and methods specified in sections 73.150 and 73.152 of the Commission's rules. Radiation values were calculated for each of 360 radials around the transmitter site. Next, estimated soil conductivity data was retrieved from a database representing the information in FCC Figure R3. Using the calculated horizontal radiation values, and the retrieved soil conductivity data, the distance to the principal community (5 mV/m) contour was predicted for each of the 360 radials. The resulting distance to principal community contours were used to form a geographical polygon. Population counting was accomplished by determining which 2010 block centroids were contained in the polygon. (A block centroid is the center point of a small area containing population as computed by the U.S. Census Bureau.) The sum of the population figures for all enclosed blocks represents the total population for the predicted principal community coverage area.

    FM Stations

    The greater of the horizontal or vertical effective radiated power (ERP) (kW) and respective height above average terrain (HAAT) (m) combination was used. Where the antenna height above mean sea level (HAMSL) was available, it was used in lieu of the average HAAT figure to calculate specific HAAT figures for each of 360 radials under study. Any available directional pattern information was applied as well, to produce a radial-specific ERP figure. The HAAT and ERP figures were used in conjunction with the Field Strength (50-50) propagation curves specified in 47 CFR 73.313 of the Commission's rules to predict the distance to the principal community (70 dBu (decibel above 1 microVolt per meter) or 3.17 mV/m) contour for each of the 360 radials. The resulting distance to principal community contours were used to form a geographical polygon. Population counting was accomplished by determining which 2010 block centroids were contained in the polygon. The sum of the population figures for all enclosed blocks represents the total population for the predicted principal community coverage area.

    Table 7—FY 2015 Schedule of Regulatory Fees

    Regulatory fees for the first eight categories below are collected by the Commission in advance to cover the term of the license and are submitted at the time the application is filed.

    Fee category Annual
  • regulatory fee
  • (U.S. $'s)
  • PLMRS (per license) (Exclusive Use) (47 CFR part 90) 30 Microwave (per license) (47 CFR part 101) 20 Marine (Ship) (per station) (47 CFR part 80) 15 Marine (Coast) (per license) (47 CFR part 80) 35 Rural Radio (47 CFR part 22) (previously listed under the Land Mobile category) 10 PLMRS (Shared Use) (per license) (47 CFR part 90) 10 Aviation (Aircraft) (per station) (47 CFR part 87) 10 Aviation (Ground) (per license) (47 CFR part 87) 20 CMRS Mobile/Cellular Services (per unit) (47 CFR parts 20, 22, 24, 27, 80 and 90) .17 CMRS Messaging Services (per unit) (47 CFR parts 20, 22, 24 and 90) .08 Broadband Radio Service (formerly MMDS/MDS) (per license) (47 CFR part 27), Local Multipoint Distribution Service (per call sign) (47 CFR, part 101) 635, 635 AM Radio Construction Permits 590 FM Radio Construction Permits 750 Digital TV (47 CFR part 73) VHF and UHF Commercial: Markets 1-10 46,825 Markets 11-25 43,200 Markets 26-50 27,625 Markets 51-100 16,275 Remaining Markets 4,850 Construction Permits 4,850 Satellite Television Stations (All Markets) 1,575 Low Power TV, Class A TV, TV/FM Translators & Boosters (47 CFR part 74) 440 CARS (47 CFR part 78) 660 Cable Television Systems (per subscriber) (47 CFR part 76), Including IPTV .96 Direct Broadcast Service (DBS) (per subscriber) (as defined by section 602(13) of the Act) .12 Interstate Telecommunication Service Providers (per revenue dollar) .00331 Toll Free (per toll free subscriber) (47 CFR section 52.101 (f) of the rules) .12 Earth Stations (47 CFR part 25) 310 Space Stations (per operational station in geostationary orbit) (47 CFR part 25) also includes DBS Service (per operational station) (47 CFR part 100) 119,150 Space Stations (per operational system in non-geostationary orbit) (47 CFR part 25) 132,125 International Bearer Circuits—Terrestrial/Satellites (per 64KB circuit) .03 Submarine Cable Landing Licenses Fee (per cable system) See Table Below.
    FY 2015 Radio Station Regulatory Fees (Table 7 continued) Population served AM Class A AM Class B AM Class C AM Class D FM Classes
  • A, B1 & C3
  • FM Classes
  • B, C, C0, C1 & C2
  • <=25,000 $775 $645 $590 $670 $750 $925 25,001-75,000 1,550 1,300 900 1,000 1,500 1,625 75,001-150,000 2,325 1,625 1,200 1,675 2,050 3,000 150,001-500,000 3,475 2,750 1,800 2,025 3,175 3,925 500,001-1,200,000 5,025 4,225 3,000 3,375 5,050 5,775 1,200,001-3,000,00 7,750 6,500 4,500 5,400 8,250 9,250 >3,000,000 9,300 7,800 5,700 6,750 10,500 12,025
    International Bearer Circuits—Submarine Cable (Table 7 Continued) Submarine cable systems
  • (capacity as of December 31, 2014)
  • Fee amount
    <2.5 Gbps $7,175 2.5 Gbps or greater, but less than 5 Gbps 14,350 5 Gbps or greater, but less than 10 Gbps 28,675 10 Gbps or greater, but less than 20 Gbps 57,350 20 Gbps or greater 114,700
    Initial Regulatory Flexibility Analysis

    1. As required by the Regulatory Flexibility Act of 1980, as amended (RFA),88 the Commission prepared this Initial Regulatory Flexibility Analysis (IRFA) of the possible significant economic impact on small entities by the policies and rules proposed in the Notice of Proposed Rulemaking (NPRM). Written comments are requested on this IRFA. Comments must be identified as responses to the IRFA and must be filed by the deadline for comments on this NPRM. The Commission will send a copy of the NPRM, including the IRFA, to the Chief Counsel for Advocacy of the Small Business Administration (SBA).89 In addition, the NPRM and IRFA (or summaries thereof) will be published in the Federal Register.90

    88 5 U.S.C. 603. The RFA, 5 U.S.C. 601-612 has been amended by the Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA), Public Law 104-121, Title II, 110 Stat. 847 (1996).

    89 5 U.S.C. 603(a).

    90Id.

    A. Need for, and Objectives of, the Notice

    2. The NPRM seeks comment regarding adopting proposed regulatory fees for Fiscal Year 2016. The proposed regulatory fees are attached to the NPRM in Table 4. The Commission is required by Congress to adopt regulatory fees each year “to recover the costs of . . . enforcement activities, policy and rulemaking activities, user information services, and international activities.” 91 The NPRM proposes no new changes in the Commission's methodology, but does seek comment on the following. (i) As Direct Broadcast Satellites (DBS), along with other Multichannel Video Programming Distributors (MVPDs), receive oversight and regulation by Media Bureau FTEs in, e.g., the implementation of the Commercial Advertisement Loudness Mitigation Act (CALM Act),92 the Twenty-First Century Communications and Video Accessibility Act of 2010 (CVAA),93 and the Satellite Television Extension and Localism Act (STELA) Reauthorization Act of 2014 (STELAR), the NPRM proposes an increase in the DBS fee rate to 27 cents per DBS subscriber. (ii) As radio stations expand in ever increasing large markets, the population threshold of “greater than 3,000,000” is no longer an adequate threshold. As a result, the NPRM proposes to raise the population threshold of broadcasters to “greater than 6,000,000” to reflect increases in the population in major broadcast markets. In addition, the Commission also proposes to adjust the fee rates of television stations to reflect a higher proportional fee for large markets compared to medium and smaller markets. (iii) The Commission seeks comment on how providers of international bearer circuits should count their circuits to maintain consistency across all carriers to ensure that all providers are calculating and reporting IBCs in the same manner. (iv) The Commission received a proposal from ITTA to combine CMRS and ITSP revenues together for the purpose of determining a single regulatory fee rate for the CMRS and ITSP regulatory fee categories. After reviewing ITTA's proposal, the Commission tentatively concludes not to combine wireless and interstate revenues, add a subcategory for CMRS in the ITSP fee category, or reallocate Wireline Competition Bureau FTEs to the Wireless Telecommunications Bureau for the purpose of calculating regulatory fees. The Commission does, however, seek comment on regulatory fee reform, including the reallocation of direct FTEs, including those FTEs working on universal service and numbering issues. (v) Finally, the Commission seeks comment on increasing earth station fees relative to space station fees.

    91 47 U.S.C. 159(a).

    92See Implementation of the Commercial Advertisement, Loudness Mitigation (CALM) Act, Report and Order, 26 FCC Rcd 17222 (2011) (CALM Act Report and Order).

    93 Public Law Number 111-260, 124 Stat. 2751 (2010). See also Amendment of Twenty-First Century Communications and Video Accessibility Act of 2010, Public Law Number 111-265, 124 Stat. 2795 (2010) (making corrections to the CVAA); 47 CFR part 79.

    B. Legal Basis

    3. This action, including publication of proposed rules, is authorized under sections (4)(i) and (j), 9, and 303(r) of the Communications Act of 1934, as amended.94

    94 47 U.S.C. 154(i) and (j), 159, and 303(r).

    C. Description and Estimate of the Number of Small Entities to Which the Rules Will Apply

    4. The RFA directs agencies to provide a description of, and where feasible, an estimate of the number of small entities that may be affected by the proposed rules and policies, if adopted.95 The RFA generally defines the term “small entity” as having the same meaning as the terms “small business,” “small organization,” and “small governmental jurisdiction.” 96 In addition, the term “small business” has the same meaning as the term “small business concern” under the Small Business Act.97 A “small business concern” is one which: (1) Is independently owned and operated; (2) is not dominant in its field of operation; and (3) satisfies any additional criteria established by the SBA.98

    95 5 U.S.C. 603(b)(3).

    96 5 U.S.C. 601(6).

    97 5 U.S.C. 601(3) (incorporating by reference the definition of “small-business concern” in the Small Business Act, 15 U.S.C. 632). Pursuant to 5 U.S.C. 601(3), the statutory definition of a small business applies “unless an agency, after consultation with the Office of Advocacy of the Small Business Administration and after opportunity for public comment, establishes one or more definitions of such term which are appropriate to the activities of the agency and publishes such definition(s) in the Federal Register.”

    98 15 U.S.C. 632.

    5. Small Entities. Our actions, over time, may affect small entities that are not easily categorized at present. We therefore describe here, at the outset, three comprehensive small entity size standards that could be directly affected by the proposals under consideration.99 As of 2009, small businesses represented 99.9 percent of the 27.5 million businesses in the United States, according to the SBA.100 In addition, a “small organization is generally any not-for-profit enterprise which is independently owned and operated and not dominant in its field.101 Nationwide, as of 2007, there were approximately 1,621,215 small organizations.102 In addition, the term “small governmental jurisdiction” is defined generally as “governments of cities, towns, townships, villages, school districts, or special districts, with a population of less than fifty thousand.” 103 Census Bureau data for 2011 indicate that there were 90,056 local governmental jurisdictions in the United States.104 We estimate that, of this total, as many as 89,327 entities may qualify as “small governmental jurisdictions.” 105 Thus, we estimate that most local government jurisdictions are small. Finally, small entities may include Responsible Organizations (RespOrgs), which are entities chosen by toll free subscribers to manage and administer the appropriate records in the toll free Service Management System for the toll free subscriber.106 Although RespOrgs are often wireline carriers, they can also include other non-carrier entities. Please refer to each group that is acting as a RespOrg identified in this section of the IRFA. From the data on the SMS/800 Web site,107 we estimate that there are approximately 459 RespOrgs, and applying the size standard of 1500 employees is appropriate because most RespOrgs at this time, are wireline-based or wireless-based. We believe that the majority of RespOrgs are small entities under that size standard.108

    99See 5 U.S.C. 601(3)-(6).

    100See SBA, Office of Advocacy, “Frequently Asked Questions,” available at http://www.sba.gov/faqs/faqindex.cfm?arealD=24.

    101 5 U.S.C. 601(4).

    102See Independent Sector, The New Nonprofit Almanac and Desk Reference (2010).

    103 5 U.S.C. 601(5).

    104See SBA, Office of Advocacy, “Frequently Asked Questions,” available at http.www.sba.gov/sites/default/files.FAQMarch201_O.pdf.

    105 The 2011 Census Data for small governmental organizations are not presented based on the size of the population in each organization. As stated above, there were 90,056 local governmental organizations in 2011. As a basis for estimating how many of these 90,056 local organizations were small, we note that there were a total of 729 cities and towns (incorporated places and civil divisions) with populations over 50,000. See http://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?src=bkmk. If we subtract the 729 cities and towns that exceed the 50,000 population threshold, we conclude that approximately 789,237 are small.

    106 47 CFR 52.101(b).

    107https://www.somos.com/. SMS/800, Inc. is now Somos, Inc.

    108See, e.g., 13 CFR 121.101; NAICS Code 517110; NAICS Code 517210. For purposes of this IRFA, because a substantial percentage of RespOrgs are wireless-based or wireline-based, the standard size applicable to these carriers is referenced.

    6. Wired Telecommunications Carriers. The U.S. Census Bureau defines this industry as “establishments primarily engaged in operating and/or providing access to transmission facilities and infrastructure that they own and/or lease for the transmission of voice, data, text, sound, and video using wired communications networks. Transmission facilities may be based on a single technology or a combination of technologies. Establishments in this industry use the wired telecommunications network facilities that they operate to provide a variety of services, such as wired telephony services, including VoIP services, wired (cable) audio and video programming distribution, and wired broadband internet services. By exception, establishments providing satellite television distribution services using facilities and infrastructure that they operate are included in this industry.” 109 The SBA has developed a small business size standard for Wired Telecommunications Carriers, which consists of all such companies having 1,500 or fewer employees.110 Census data for 2007 shows that there were 3,188 firms that operated that year. Of this total, 3,144 operated with fewer than 1,000 employees.111 Thus, under this size standard, the majority of firms in this industry can be considered small.

    109See http://www.census.gov/cgi-bin/sssd/naics/naicsrch.

    110See 13 CFR 120.201, NAICS Code 517110.

    111http://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ECN_2007_US_51SSSZ5 &prodType= table.

    7. Local Exchange Carriers (LECs). Neither the Commission nor the SBA has developed a size standard for small businesses specifically applicable to local exchange services. The closest applicable NAICS Code category is for Wired Telecommunications Carriers as defined in paragraph 6 of this IRFA. Under that size standard, such a business is small if it has 1,500 or fewer employees.112 According to census data from 2007, there were 3,188 establishments that operated that year. Of this total, 3,144 operated with fewer than 1,000 employees.113 The Commission estimates that most providers of local exchange service are small entities that may be affected by the rules and policies proposed in the NPRM.

    112 13 CFR 121.201, NAICS code 517110.

    113See id.

    8. Incumbent LECs. Neither the Commission nor the SBA has developed a small business size standard specifically for incumbent local exchange services. The closest applicable NAICS Code category is Wired Telecommunications Carriers, as defined in paragraph 6 of this IRFA. Under that size standard, such a business is small if it has 1,500 or fewer employees.114 According to census data from 2007, 3,188 firms operated in that year. Of this total, 3,144 operated with fewer than 1,000 employees.115 According to the Industry Analysis Branch of the Wireline Competition Bureau, 1,307 carriers reported that they were incumbent local exchange service providers.116 Of this total of 1,307 incumbent local exchange service providers, an estimated 1,006 operated with 1,500 or fewer employees 117 Consequently, the Commission estimates that most providers of incumbent local exchange service are small businesses that may be affected by the rules and policies proposed in the NPRM.

    114 13 CFR 121.201, NAICS code 517110.

    115http://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ECN_2007_US_51SSSZ5 &prodType= table.

    116See Trends in Telephone Service, Federal Communications Commission, Wireline Competition Bureau, Industry Analysis and Technology Division at Table 5.3 (Sept. 2010) (Trends in Telephone Service).

    117See id.

    9. Competitive Local Exchange Carriers (Competitive LECs), Competitive Access Providers (CAPs), Shared-Tenant Service Providers, and Other Local Service Providers. Neither the Commission nor the SBA has developed a small business size standard specifically for these service providers. The appropriate NAICS Code category is Wired Telecommunications Carriers, as defined in paragraph 6 of this IRFA. Under that size standard, such a business is small if it has 1,500 or fewer employees.118 U.S. Census data for 2007 indicate that 3,188 firms operated during that year. Of that number, 3,144 operated with fewer than 1,000 employees.119 Based on this data, the Commission concludes that the majority of Competitive LECs, CAPs, Shared-Tenant Service Providers, and Other Local Service Providers are small entities. According to the Commission's Industry Analysis Division of the Wireline Competition Bureau data, 1,442 carriers reported that they were engaged in the provision of either competitive local exchange services or competitive access provider services.120 Of these 1,442 carriers, an estimated 1,256 have 1,500 or fewer employees. In addition, 17 carriers have reported that they are Shared-Tenant Service Providers, and all 17 are estimated to have 1,500 or fewer employees.121 In addition, 72 carriers have reported that they are Other Local Service Providers.122 Of this total, 70 have 1,500 or fewer employees.123 Consequently, the Commission estimates that most providers of competitive local exchange service, competitive access providers, Shared-Tenant Service Providers, and Other Local Service Providers are small entities that may be affected by rules adopted pursuant to the proposals in this NPRM.

    118 13 CFR 121.201, NAICS code 517110.

    119http://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ECN_2007_US_51SSSZ5&prodType=%20table.

    120See Trends in Telephone Service, at Table 5.3.

    121Id.

    122Id.

    123Id.

    10. Interexchange Carriers (IXCs). Neither the Commission nor the SBA has developed a definition for Interexchange Carriers. The closest NAICS Code category is Wired Telecommunications Carriers as defined in paragraph 6 of this IRFA. The applicable size standard under SBA rules is that such a business is small if it has 1,500 or fewer employees.124 According to Commission's Industry Analysis Division of the Wireline Competition Bureau data, 359 companies reported that their primary telecommunications service activity was the provision of interexchange services.125 Of this total, an estimated 317 have 1,500 or fewer employees and 42 have more than 1,500 employees.126 Consequently, the Commission estimates that the majority of interexchange service providers are small entities that may be affected by rules adopted pursuant to the NPRM.

    124 13 CFR 121.201, NAICS code 517110.

    125See Trends in Telephone Service, at Table 5.3.

    126Id.

    11. Prepaid Calling Card Providers. Neither the Commission nor the SBA has developed a small business size standard specifically for prepaid calling card providers. The appropriate NAICS Code category for prepaid calling card providers is Telecommunications Resellers. This industry comprises establishments engaged in purchasing access and network capacity from owners and operators of telecommunications networks and reselling wired and wireless telecommunications services (except satellite) to businesses and households. Mobile virtual networks operators (MVNOs) are included in this industry.127 Under the applicable SBA size standard, such a business is small if it has 1,500 or fewer employees.128 U.S. Census data for 2007 show that 1,523 firms provided resale services during that year. Of that number, 1,522 operated with fewer than 1,000 employees.129 Thus, under this category and the associated small business size standard, the majority of these prepaid calling card providers can be considered small entities. According to Commission's Industry Analysis Division of the Wireline Competition Bureau data, 193 carriers have reported that they are engaged in the provision of prepaid calling cards.130 All 193 carriers have 1,500 or fewer employees.131 Consequently, the Commission estimates that the majority of prepaid calling card providers are small entities that may be affected by rules adopted pursuant to the NPRM.

    127http://www.census.gov/cgi-bin/ssd/naics/naicsrch.

    128 13 CFR 121.201, NAICS code 517911.

    129http://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ECN_2007_US_51SSSZ5&prodType=table.

    130See Trends in Telephone Service, at Table 5.3.

    131Id.

    12. Local Resellers. The SBA has developed a small business size standard for the category of Telecommunications Resellers. Under that size standard, such a business is small if it has 1,500 or fewer employees.132 Census data for 2007 show that 1,523 firms provided resale services during that year. Of that number, 1,522 operated with fewer than 1,000 employees.133 Under this category and the associated small business size standard, the majority of these local resellers can be considered small entities. According to Commission's Industry Analysis Division of the Wireline Competition Bureau data, 213 carriers have reported that they are engaged in the provision of local resale services.134 Of this total, an estimated 211 have 1,500 or fewer employees.135 Consequently, the Commission estimates that the majority of local resellers are small entities that may be affected by rules adopted pursuant to the proposals in this NPRM.

    132 13 CFR 121.201, NAICS code 517911.

    133Id.

    134See Trends in Telephone Service, at Table 5.3.

    135Id.

    13. Toll Resellers. The Commission has not developed a definition for Toll Resellers. The closest NAICS Code Category is Telecommunications Resellers, and the SBA has developed a small business size standard for the category of Telecommunications Resellers. Under that size standard, such a business is small if it has 1,500 or fewer employees.136 Census data for 2007 show that 1,523 firms provided resale services during that year. Of that number, 1,522 operated with fewer than 1,000 employees.137 Thus, under this category and the associated small business size standard, the majority of these resellers can be considered small entities. According to Commission's Industry Analysis Division of the Wireline Competition Bureau data, 881 carriers have reported that they are engaged in the provision of toll resale services.138 Of this total, an estimated 857 have 1,500 or fewer employees.139 Consequently, the Commission estimates that the majority of toll resellers are small entities that may be affected by our proposals in the NPRM.

    136 13 CFR 121.201, NAICS code 517911.

    137Id.

    138Trends in Telephone Service, at Table 5.3.

    139Id.

    14. Other Toll Carriers. Neither the Commission nor the SBA has developed a size standard for small businesses specifically applicable to Other Toll Carriers. This category includes toll carriers that do not fall within the categories of interexchange carriers, operator service providers, prepaid calling card providers, satellite service carriers, or toll resellers. The closest applicable NAICS Code category is for Wired Telecommunications Carriers, as defined in paragraph 6 of this IRFA. Under that size standard, such a business is small if it has 1,500 or fewer employees.140 Census data for 2007 shows that there were 3,188 firms that operated that year. Of this total, 3,144 operated with fewer than 1,000 employees.141 Thus, under this category and the associated small business size standard, the majority of Other Toll Carriers can be considered small. According to Commission's Industry Analysis Division of the Wireline Competition Bureau data, 284 companies reported that their primary telecommunications service activity was the provision of other toll carriage.142 Of these, an estimated 279 have 1,500 or fewer employees.143 Consequently, the Commission estimates that most Other Toll Carriers are small entities that may be affected by the rules adopted pursuant to the NPRM.

    140 13 CFR 121.201, NAICS code 517110.

    141Id.

    142 Trends in Telephone Service, at Table 5.3.

    143Id.

    15. Wireless Telecommunications Carriers (except Satellite). This industry comprises establishments engaged in operating and maintaining switching and transmission facilities to provide communications via the airwaves, such as cellular services, paging services, wireless Internet access, and wireless video services.144 The appropriate size standard under SBA rules is that such a business is small if it has 1,500 or fewer employees. For this industry, Census Data for 2007 show that there were 1,383 firms that operated for the entire year. Of this total, 1,368 firms had fewer than 1,000 employees. Thus under this category and the associated size standard, the Commission estimates that the majority of wireless telecommunications carriers (except satellite) are small entities. Similarly, according to internally developed Commission's Industry Analysis Division of the Wireline Competition Bureau data, 413 carriers reported that they were engaged in the provision of wireless telephony, including cellular service, Personal Communications Service (PCS), and Specialized Mobile Radio (SMR) services.145 Of this total, an estimated 261 have 1,500 or fewer employees.146 Consequently, the Commission estimates that approximately half of these firms can be considered small. Thus, using available data, we estimate that the majority of wireless firms can be considered small and may be affected by rules adopted pursuant to this NPRM.

    144 NAICS Code 517210. See http://www.census.gov/cgi-bin/ssd/naics/naiscsrch.

    145 Trends in Telephone Service, at Table 5.3.

    146Id.

    16. Television Broadcasting. This Economic Census category “comprises establishments primarily engaged in broadcasting images together with sound. These establishments operate television broadcasting studios and facilities for the programming and transmission of programs to the public.” 147 The SBA has created the following small business size standard for Television Broadcasting firms: those having $14 million or less in annual receipts.148 The Commission has estimated the number of licensed commercial television stations to be 1,387.149 In addition, according to Commission staff review of the BIA Advisory Services, LLC's Media Access Pro Television Database on March 28, 2012, about 950 of an estimated 1,300 commercial television stations (or approximately 73 percent) had revenues of $14 million or less.150 We therefore estimate that the majority of commercial television broadcasters are small entities.

    147 U.S. Census Bureau, 2007 NAICS Definitions, “515120 Television Broadcasting” (partial definition); http://www.census.gov/naics/2007/def/ND515120.HTM#N515120.

    148 13 CFR 121.201, NAICS code 515120 (updated for inflation in 2010).

    149See FCC News Release, “Broadcast Station Totals as of December 31, 2011,” dated January 6, 2012; http://transition.fcc.gov/Daily_Releases/Daily_Business/2012/db0106/DOC-311837A1.pdf.

    150 We recognize that BIA's estimate differs slightly from the FCC total given supra.

    17. We note, however, that in assessing whether a business concern qualifies as small under the above definition, business (control) affiliations 151 must be included. Our estimate, therefore, likely overstates the number of small entities that might be affected by our action, because the revenue figure on which it is based does not include or aggregate revenues from affiliated companies. In addition, an element of the definition of “small business” is that the entity not be dominant in its field of operation. We are unable at this time to define or quantify the criteria that would establish whether a specific television station is dominant in its field of operation. Accordingly, the estimate of small businesses to which rules may apply does not exclude any television station from the definition of a small business on this basis and is therefore possibly over-inclusive to that extent.

    151 “[Business concerns] are affiliates of each other when one concern controls or has the power to control the other or a third party or parties controls or has to power to control both.” 13 CFR 21.103(a)(1).

    18. In addition, the Commission has estimated the number of licensed noncommercial educational (NCE) television stations to be 396.152 These stations are non-profit, and therefore considered to be small entities.153 There are also 2,528 low power television stations, including Class A stations (LPTV).154 Given the nature of these services, we will presume that all LPTV licensees qualify as small entities under the above SBA small business size standard.

    152See FCC News Release, “Broadcast Station Totals as of December 31, 2011,” dated January 6, 2012; http://transition.fcc.gov/Daily_Releases/Daily_Business/2012/db0106/DOC-311837A1.pdf.

    153See generally 5 U.S.C. 601(4), (6).

    154See FCC News Release, “Broadcast Station Totals as of December 31, 2011,” dated January 6, 2012; http://transition.fcc.gov/Daily_Releases/Daily_Business/2012/db0106/DOC-311837A1.pdf.

    19. Radio Broadcasting. This Economic Census category “comprises establishments primarily engaged in broadcasting aural programs by radio to the public. Programming may originate in their own studio, from an affiliated network, or from external sources. 155 The SBA has established a small business size standard for this category, which is: Such firms having $7 million or less in annual receipts.156 According to Commission staff review of BIA Advisory Services, LLC's Media Access Pro Radio Database on March 28, 2012, about 10,759 (97%) of 11,102 commercial radio stations had revenues of $7 million or less. Therefore, the majority of such entities are small entities.

    155 U.S. Census Bureau, 2007 NAICS Definitions, “515112 Radio Stations”; http://www.census.gov/naics/2007/def/ND515112.HTM#N515112.

    156 13 CFR 121.201, NAICS code 515112 (updated for inflation in 2010).

    20. We note, however, that in assessing whether a business concern qualifies as small under the above size standard, business affiliations must be included.157 In addition, to be determined to be a “small business,” the entity may not be dominant in its field of operation.158 We note that it is difficult at times to assess these criteria in the context of media entities, and our estimate of small businesses may therefore be over-inclusive.

    157 “Concerns and entities are affiliates of each other when one controls or has the power to control the other, or a third party or parties controls or has the power to control both. It does not matter whether control is exercised, so long as the power to control exists.” 13 CFR 121.103(a)(1) (an SBA regulation).

    158 13 CFR 121.102(b) (an SBA regulation).

    21. Cable Television and other Subscription Programming. 159 Since 2007, these services have been defined within the broad economic census category of Wired Telecommunications Carriers. That category is defined as follows: “This industry comprises establishments primarily engaged in operating and/or providing access to transmission facilities and infrastructure that they own and/or lease for the transmission of voice, data, text, sound, and video using wired telecommunications networks. Transmission facilities may be based on a single technology or a combination of technologies.” 160 The SBA has developed a small business size standard for this category, which is: all such firms having 1,500 or fewer employees.161 Census data for 2007 shows that there were 3,188 firms that operated that year. Of this total, 3,144 had fewer than 1,000 employees.162 Thus under this size standard, the majority of firms offering cable and other program distribution services can be considered small and may be affected by rules adopted pursuant to the NPRM.

    159 In 2014, “Cable and Other Subscription Programming,” NAICS Code 515210, replaced a prior category, now obsolete, which was called “Cable and Other Program Distribution.” Cable and Other Program Distribution, prior to 2014, were placed under NAICS Code 517110, Wired Telecommunications Carriers. Wired Telecommunications Carriers is still a current and valid NAICS Code Category. Because of the similarity between “Cable and Other Subscription Programming” and “Cable and other Program Distribution,” we will, in this proceeding, continue to use Wired Telecommunications Carrier data based on the U.S. Census. The alternative of using data gathered under Cable and Other Subscription Programming (NAICS Code 515210) is unavailable to us for two reasons. First, the size standard established by the SBA for Cable and Other Subscription Programming is annual receipts of $38.5 million or less. Thus to use the annual receipts size standard would require the Commission either to switch from existing employee based size standard of 1,500 employees or less for Wired Telecommunications Carriers, or else would require the use of two size standards. No official approval of either option has been granted by the Commission as of the time of the release of the Notice. Second, the data available under the size standard of $38.5 million dollars or less is not applicable at this time, because the only currently available U.S. Census data for annual receipts of all businesses operating in the NAICS Code category of 515210 (Cable and other Subscription Programming) consists only of total receipts for all businesses operating in this category in 2007 and of total annual receipts for all businesses operatin6 in this category in 2012. Hence the data do not provide any basis for determining, for either year, how many businesses were small because they had annual receipts of $38.5 million or less. http://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ECN_2012_US_51I2&prodType=table.

    160 U.S. Census Bureau, 2007 NAICS Definitions, “517110 Wired Telecommunications Carriers” (partial definition), (full definition stated in para. 6 of this IRFA) available at http://www.census.gov/cgi-bin/sssd/naics/naicsrch.

    161 13 CFR 121.201, NAICS code 517110.

    162http://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ECN_2007_US-51SSSZ5&prodType=Table.

    22. Cable Companies and Systems. The Commission has developed its own small business size standards for the purpose of cable rate regulation. Under the Commission's rules, a “small cable company” is one serving 400,000 or fewer subscribers nationwide.163 Industry data indicate that there are currently 4,600 active cable systems in the United States.164 Of this total, all but ten cable operators nationwide are small under the 400,000-subscriber size standard.165 In addition, under the Commission's rate regulation rules, a “small system” is a cable system serving 15,000 or fewer subscribers.166 Current Commission records show 4,600 cable systems nationwide.167 Of this total, 3,900 cable systems have less than 15,000 subscribers, and 700 systems have 15,000 or more subscribers, based on the same records.168 Thus, under this standard as well, the Commission estimates that most cable systems are small entities.

    163 47 CFR 76.901(e).

    164 August 15, 2015 Report from the Media Bureau based on data contained in the Commission's Cable Operations And Licensing System (COALS). See www/fcc.gov/coals.

    165See SNL KAGAN at www.snl.com/interactiveX/top cableMSOs aspx?period2015Q1&sortcol=subscribersbasic&sortorder=desc.

    166 47 CFR 76.901(c).

    167See footnote 2, supra.

    168 August 5, 2015 report from the Media Bureau based on its research in COALS. See www.fcc.gov/coals.

    23. Cable System Operators (Telecom Act Standard). The Communications Act of 1934, as amended, also contains a size standard for small cable system operators, which is “a cable operator that, directly or through an affiliate, serves in the aggregate fewer than 1 percent of all subscribers in the United States and is not affiliated with any entity or entities whose gross annual revenues in the aggregate exceed $250,000,000 are approximately 52,403,705 cable video subscribers in the United States today.169 Accordingly, an operator serving fewer than 524,037 subscribers shall be deemed a small operator if its annual revenues, when combined with the total annual revenues of all its affiliates, do not exceed $250 million in the aggregate.170 Based on available data, we find that all but nine incumbent cable operators are small entities under this size standard.171 We note that the Commission neither requests nor collects information on whether cable system operators are affiliated with entities whose gross annual revenues exceed $250 million.172 Although it seems certain that some of these cable system operators are affiliated with entities whose gross annual revenues exceed $250,000,000, we are unable at this time to estimate with greater precision the number of cable system operators that would qualify as small cable operators under the definition in the Communications Act.

    169See SNL KAGAN at www.snl.com/interactivex/MultichannelIndustryBenchmarks.aspx.

    170 47 CFR 76.901(f) and notes ff. 1, 2, and 3.

    171 See SNL KAGAN at www.snl.com/Interactivex/TopCableMSOs.aspx.

    172 The Commission does receive such information on a case-by-case basis if a cable operator appeals a local franchise authority's finding that the operator does not qualify as a small cable operator pursuant to section 76.901(f) of the Commission's rules. See 47 CFR 76.901(f).

    24. Direct Broadcast Satellite (DBS) Service. DBS Service is a nationally distributed subscription service that delivers video and audio programming via satellite to a small parabolic dish antenna at the subscriber's location. DBS is now included in SBA's economic census category “Wired Telecommunications Carriers.” The Wired Telecommunications Carriers industry comprises establishments primarily engaged in operating and/or providing access to transmission facilities and infrastructure that they own and/or lease for the transmission of voice, data, text, sound, and video using wired telecommunications networks. Transmission facilities may be based on a single technology or combination of technologies. Establishments in this industry use the wired telecommunications network facilities that they operate to provide a variety of services, such as wired telephony services, including VOIP services, wired (cable) audio and video programming distribution; and wired broadband internet services. By exception, establishments providing satellite television distribution services using facilities and infrastructure that they operate are included in this industry.173 The SBA determines that a wireline business is small if it has fewer than 1500 employees.174 Census data for 2007 indicate that 3,188 wireline companies were operational during that year. Of that number, 3,144 operated with fewer than 1,000 employees.175 Based on that data, we conclude that the majority of wireline firms are small under the applicable standard. However, currently only two entities provide DBS service, which requires a great deal of capital for operation: DIRECTV (now owned by AT&T) and DISH Network.176 DIRECTV and DISH Network each report annual revenues that are in excess of the threshold for a small business. Accordingly, we must conclude that internally developed FCC data are persuasive that in general DBS service is provided only by large firms.

    173http://www.census.gov/cgi-bin/sssd/naics/naicsrch.

    174 NAICs CODE 517110; 13.CFR 121.201.

    175http://factfinder.census.gov/faces/tableservices/jsf/pages/productview.xhtml?pid=ECN_2007_US_51SSSZ5&prodType=table.

    176See 15th Annual Video Competition Report, 28 FCC Rcd at 1057, Section 27. As of June 2012, DIRECTV is the largest DBS operator and the second largest MVPD in the United States, serving 19.9 million subscribers. DISH Network is the second largest DBS operator and the third largest MVPD operator, serving 14 million subscribers. Id. at 10507, 10546, section 27, 110-11.

    25. All Other Telecommunications. “All Other Telecommunications” is defined as follows: This U.S. industry is comprised of establishments that are primarily engaged in providing specialized telecommunications services, such as satellite tracking, communications telemetry, and radar station operation. This industry also includes establishments primarily engaged in providing satellite terminal stations and associated facilities connected with one or more terrestrial systems and capable of transmitting telecommunications to, and receiving telecommunications from, satellite systems. Establishments providing Internet services or voice over Internet protocol (VoIP) services via client-supplied telecommunications connections are also included in this industry.177 The SBA has developed a small business size standard for “All Other Telecommunications,” which consists of all such firms with gross annual receipts of $32.5 million or less.178 For this category, census data for 2007 show that there were 2,383 firms that operated for the entire year. Of these firms, a total of 2,346 had gross annual receipts of less than $25 million.179 Thus, a majority of “All Other Telecommunications” firms potentially affected by the proposals in the NPRM can be considered small.

    177http://www.census.gov/cgi-bin/ssssd/naics/naicsrch.

    178 13 CFR 121.201; NAICs Code 517919.

    179http://factfinder.census.gov/faces/tableservices.jasf/pages/productview.xhtml?pid+ECN_2007_US.51SSSZ4&prodType=table.

    D. Description of Projected Reporting, Recordkeeping and Other Compliance Requirements

    26. This NPRM does not propose any changes to the Commission's current information collection, reporting, recordkeeping, or compliance requirements.

    E. Steps Taken To Minimize Significant Economic Impact on Small Entities, and Significant Alternatives Considered

    27. The RFA requires an agency to describe any significant alternatives that it has considered in reaching its approach, which may include the following four alternatives, among others: (1) The establishment of differing compliance or reporting requirements or timetables that take into account the resources available to small entities; (2) the clarification, consolidation, or simplification of compliance or reporting requirements under the rule for small entities; (3) the use of performance, rather than design, standards; and (4) an exemption from coverage of the rule, or any part thereof, for small entities.180

    180 5 U.S.C. 603(c)(1)-(c)(4).

    28. This NPRM seeks comment on the Commission's regulatory fee collection for Fiscal Year 2016, as required by Congress each year. Specifically, we ask for comments each year in the Regulatory Flexibility Analysis on how to minimize adverse economic impact, imposed by our proposed rules, on small entities. The regulatory fees proposed in this NPRM do not include any new fee categories. However, the proposal in FY 2016 to revise the broadcasters' fee grid to include a threshold “greater than 6,000,000”, and a change in the television fee amounts so that large markets pay a higher proportional fee than small and medium-sized markets, will provide some relief to small broadcast and television entities. The increase in the de minimis amount to $500 implemented in FY 2015 has already provided financial relief to smaller entities.

    F. Federal Rules That May Duplicate, Overlap, or Conflict With the Proposed Rules

    29. None.

    VII. Ordering Clauses

    30. Accordingly, it is ordered that, pursuant to sections 4(i) and (j), 9, and 303(r) of the Communications Act of 1934, as amended, 47 U.S.C. 154(i), 154(j), 159, and 303(r), this Notice of Proposed Rulemaking is hereby adopted.

    31. It is further ordered that the Commission's Consumer and Governmental Affairs Bureau, Reference Information Center, shall send a copy of this Notice of Proposed Rulemaking, including the Initial Regulatory Flexibility Analysis, to the Chief Counsel for Advocacy of the U.S. Small Business Administration.

    Federal Communications Commission. Marlene H. Dortch, Secretary.
    [FR Doc. 2016-13087 Filed 6-2-16; 8:45 am] BILLING CODE 6712-01-P
    DEPARTMENT OF THE INTERIOR Fish and Wildlife Service 50 CFR Part 17 [Docket Nos. FWS-R3-ES-2016-0061; FWS-R2-ES-2016-0062] 4500030115 Endangered and Threatened Wildlife and Plants; 90-Day Findings on Two Petitions AGENCY:

    Fish and Wildlife Service, Interior.

    ACTION:

    Notice of petition findings and initiation of status review.

    SUMMARY:

    We, the U.S. Fish and Wildlife Service (Service), announce 90-day findings on two petitions to list or delist wildlife under the Endangered Species Act of 1973, as amended (Act). Based on our review, we find that one petition, which requests that we remove the golden-cheeked warbler from the Federal List of Endangered and Threatened Wildlife, does not present substantial scientific or commercial information indicating that the petitioned action may be warranted, and we are not initiating a status review in response to this petition. We refer to this as a “not-substantial petition finding.” We also find that the other petition, which requests that we list the U.S. population of northwestern moose (Alces alces andersoni) as an endangered or threatened distinct population segment (DPS), presents substantial scientific or commercial information indicating that the petitioned action may be warranted. Therefore, with the publication of this document, we are initiating a review of the status of this population to determine if the petitioned action is warranted. To ensure that this status review is comprehensive, we are requesting scientific and commercial data and other information regarding this subspecies. Based on the status review, we will issue a 12-month finding on the petition, which will address whether the petitioned action is warranted, as provided in section 4(b)(3)(B) of the Act.

    DATES:

    To allow us adequate time to conduct the status review, we request that we receive information no later than August 2, 2016. Information submitted electronically using the Federal eRulemaking Portal (see ADDRESSES, below) must be received by 11:59 p.m. Eastern Time on the closing date.

    ADDRESSES:

    Not-substantial petition finding: The not-substantial petition finding for the golden-cheeked warbler is available on http://www.regulations.gov under the docket number FWS-R2-ES-2016-0062. Supporting information in preparing this finding is available for public inspection, by appointment, during normal business hours by contacting the appropriate person, as specified under FOR FURTHER INFORMATION CONTACT.

    Status review: You may submit information on the U.S. population of northwestern moose (Alces alces andersoni) by one of the following methods:

    (1) Electronically: Go to the Federal eRulemaking Portal: http://www.regulations.gov. In the Search box, enter the docket number: FWS-R3-ES-2016-0061. You may submit information by clicking on “Comment Now!” If your information will fit in the provided comment box, please use this feature of http://www.regulations.gov, as it is most compatible with our information review procedures. If you attach your information as a separate document, our preferred file format is Microsoft Word. If you attach multiple comments (such as form letters), our preferred format is a spreadsheet in Microsoft Excel.

    (2) By hard copy: Submit by U.S. mail or hand-delivery to: Public Comments Processing, Attn: FWS-R3-ES-2016-0061; U.S. Fish and Wildlife Service, MS: BPHC, 5275 Leesburg Pike; Falls Church, VA 22041-3803.

    We request that you send information only by the methods described above. We will post all information received on http://www.regulations.gov. This generally means that we will post any personal information you provide us (see Request for Information, below, for more details).

    FOR FURTHER INFORMATION CONTACT:

    For information on the golden-cheeked warbler, contact Adam Zerrenner, [email protected], or 512-490-0057. For information on the U.S. population of northwestern moose (Alces alces andersoni), contact John JaKa, [email protected], 612-713-5350.

    If you use a telecommunications device for the deaf (TDD), please call the Federal Information Relay Service (FIRS) at 800-877-8339.

    SUPPLEMENTARY INFORMATION:

    Request for Information

    When we make a finding that a petition presents substantial information indicating that listing, reclassification, or delisting a species may be warranted, we are required to promptly review the status of the species (status review). For the status review to be complete and based on the best available scientific and commercial data available, we request information on these species from governmental agencies, Native American Tribes, the scientific community, industry, and any other interested parties. We seek information on:

    (1) The biology, range, and population trends of the U.S. population of northwestern moose (Alces alces andersoni), including:

    (a) Habitat requirements;

    (b) Genetics and taxonomy;

    (c) Historical and current range, including distribution patterns;

    (d) Historical and current population levels, and current and projected trends; and

    (e) Past and ongoing conservation measures for the subspecies, its habitat, or both.

    (2) The factors that are the basis for making a listing, reclassification, or delisting determination for a species under section 4(a) of the Act (16 U.S.C. 1531 et seq.), which are:

    (a) The present or threatened destruction, modification, or curtailment of its habitat or range (Factor A);

    (b) Overutilization for commercial, recreational, scientific, or educational purposes (Factor B);

    (c) Disease or predation (Factor C);

    (d) The inadequacy of existing regulatory mechanisms (Factor D); or

    (e) Other natural or manmade factors affecting its continued existence (Factor E).

    (3) The potential effects of climate change on this subspecies and its habitat.

    (4) Additional evidence of discreteness, with respect to the 1996 DPS Policy (61 FR 4722, February 7, 1996), regarding the status of the U.S. population of northwestern moose (Alces alces andersoni) satisfying one or both of the following conditions:

    (a) It is markedly separated from other populations of the same taxon as a consequence of physical, physiological, ecological, or behavioral factors. Quantitative measures of genetic or morphological discontinuity may provide evidence of this separation.

    (b) It is delimited by international governmental boundaries within which differences in control of exploitation, management of habitat, conservation status, or regulatory mechanisms exist that are significant in light of section 4(a)(1)(D) of the Act.

    (5) Additional evidence of significance regarding the status of U.S. population of northwestern moose (Alces alces andersoni) including, but not limited to:

    (a) Persistence of the discrete population segment in an ecological setting unusual or unique for the taxon,

    (b) Evidence that loss of the discrete population segment would result in a significant gap in the range of a taxon, or

    (c) Evidence that the discrete population segment differs markedly from other populations of the species in genetic characteristics.

    If, after the status review, we determine that listing is warranted, we will propose critical habitat (see definition at section 3(5)(A) of the Act) for domestic (U.S.) species under section 4 of the Act, to the maximum extent prudent and determinable at the time we propose to list the species. Therefore, we also request data and information for the U.S. population of northwestern moose (Alces alces andersoni) on:

    (6) What may constitute “physical or biological features essential to the conservation of the species,” within the geographical range occupied by the subspecies;

    (7) Where these features are currently found;

    (8) Whether any of these features may require special management considerations or protection;

    (9) Specific areas outside the geographical area occupied by the subspecies that are “essential for the conservation of the species”; and

    (10) What, if any, critical habitat you think we should propose for designation if the subspecies is proposed for listing, such as:

    (a) Why these habitats meet the requirements of section 4 of the Act; and

    (b) Any probable economic, national security, or other relevant impacts of designating any area that may be included in the proposed designation, and the benefits of including or excluding areas that exhibit these impacts.

    Please include sufficient information with your submission (such as scientific journal articles or other publications, and citations to specific pages) to allow us to verify any scientific or commercial information you include.

    Submissions merely stating support for or opposition to the actions under consideration without providing supporting information, although noted, will not be considered in making a determination. Section 4(b)(1)(A) of the Act directs that determinations as to whether any species is an endangered or threatened species must be made “solely on the basis of the best scientific and commercial data available.”

    You may submit your information concerning this status review by one of the methods listed in ADDRESSES. If you submit information via http://www.regulations.gov, your entire submission—including any personal identifying information—will be posted on the Web site. If you submit a hardcopy that includes personal identifying information, you may request at the top of your document that we withhold this personal identifying information from public review. However, we cannot guarantee that we will be able to do so. We will post all hardcopy submissions on http://www.regulations.gov.

    Information and supporting documentation that we received and used in preparing this finding will be available for you to review at http://www.regulations.gov, or you may make an appointment during normal business hours by contacting the appropriate person listed under FOR FURTHER INFORMATION CONTACT, above.

    Background

    Section 4(b)(3)(A) of the Act requires that we make a finding on whether a petition to list, delist, or reclassify a species presents substantial scientific or commercial information indicating that the petitioned action may be warranted. To the maximum extent practicable, we are to make this finding within 90 days of our receipt of the petition and publish our notice of the finding promptly in the Federal Register.

    Our standard for substantial scientific or commercial information within the Code of Federal Regulations (CFR) with regard to a 90-day petition finding is “that amount of information that would lead a reasonable person to believe that the measure proposed in the petition may be warranted” (50 CFR 424.14(b)). If we find that substantial scientific or commercial information was presented, we are required to promptly commence a review of the status of the species, which will be subsequently summarized in our 12-month finding.

    Section 4 of the Act (16 U.S.C. 1533) and its implementing regulations at 50 CFR 424 set forth the procedures for adding a species to, or removing a species from, the Federal Lists of Endangered and Threatened Wildlife and Plants. A species may be determined to be an endangered or threatened species due to one or more of the five factors described in section 4(a)(1) of the Act (see (2) under Request For Information, above).

    We may delist a species according to 50 CFR 424.11(d) if the best available scientific and commercial data indicate that the species is neither endangered nor threatened for one or more of the following reasons:

    (1) The species is extinct;

    (2) The species has recovered and is no longer endangered or threatened; or

    (3) The original scientific or commercial data used at the time the species was classified, or the interpretation of such data, were in error.

    In considering what factors might constitute threats, we must look beyond the exposure of the species to a factor to evaluate whether the species may respond to the factor in a way that causes actual impacts to the species. If there is exposure to a factor and the species responds negatively, the factor may be a threat. However, the identification of factors that could affect a species negatively may not be sufficient to compel a finding that the information in the petition is substantial information indicating that the petitioned action may be warranted. Therefore, during the subsequent status review, we attempt to determine how significant a threat it is. The threat is significant if it drives, or contributes to, the risk of extinction of the species such that the species may warrant listing as endangered or threatened as those terms are defined in the Act. The information presented in the petition must include evidence sufficient to suggest that these factors may be operative threats that act on the species to the point that the species may meet the definition of an endangered or threatened species under the Act.

    Evaluation of a Petition To Remove the Golden-Cheeked Warbler From the List of Endangered and Threatened Wildlife

    Additional information regarding our review of this petition can be found as an appendix at http://www.regulations.gov under Docket No. FWS-R2-ES-2016-0062 under the Supporting Documents section.

    Species and Range

    Golden-cheeked warbler (Dendroica chrysoparia =Setophaga chrysoparia, hereafter warbler), a migratory songbird breeding exclusively in Texas, and wintering in the highlands of Mexico (Chiapas) and Central America (Guatemala, Honduras, Nicaragua, El Salvador).

    Petition History

    On June 30, 2015, we received a petition dated June 29, 2015, from Nancie G. Marzulla (Marzulla Law, LLC—Washington DC) and Robert Henneke (Texas Public Policy Foundation—Austin TX) requesting that the golden-cheeked warbler be removed from the Federal List of Endangered and Threatened Wildlife (“delisted”) due to recovery or error in information. The petition clearly identified itself as a petition and included the requisite identification information for the petitioner, as required at 50 CFR 424.14(a).

    On December 11, 2015, we received supplemental information from the petitioners that included additional published studies and an unpublished report. These studies, as well as others known to the Service and in our files at the time the supplement was received, were considered, as appropriate, in this finding. This finding addresses the petition.

    Finding

    Based on our review of the petition, sources cited in the petition, and information in our files, we find that the petition does not provide substantial scientific or commercial information indicating that the petitioned action may be warranted. No new information is presented that would suggest that the species was originally listed due to an error in information. The golden-cheeked warbler is a taxonomically unique species and was shown to be in danger of extinction at the time of the listing. The golden-cheeked warbler has not been recovered, and due to ongoing, widespread destruction of its habitat, the species continues to be in danger of extinction throughout its range (Service 2014, p. 15).

    Because the petition does not present substantial information indicating that delisting the golden-cheeked warbler may be warranted, we are not initiating a status review in response to this petition. Our explanation for this finding can be found as an appendix at http://www.regulations.gov under Docket No. FWS-R2-ES-2016-0062 under the Supporting Documents section. However, we ask that the public submit to us any new information that becomes available concerning the status of, or threats to, the golden-cheeked warbler or its habitat at any time (see FOR FURTHER INFORMATION CONTACT).

    Evaluation of a Petition To List the U.S. Population of Northwestern Moose (Alces alces andersoni) as an Endangered or Threatened Distinct Population Segment (DPS)

    Additional information regarding our review of this petition can be found as an appendix at http://www.regulations.gov under Docket No. FWS-R3-ES-2016-0061 under the Supporting Documents section.

    Species and Range

    U.S. population of northwestern moose (Alces alces andersoni); Michigan (Upper Peninsula), Minnesota, North Dakota, and Wisconsin.

    Petition History

    We received a petition dated July 9, 2015, from the Center for Biological Diversity and Honor the Earth, requesting that we list the U.S. population of northwestern moose (Alces alces andersoni) under the Act. The petition clearly identified itself as such and included the requisite identification information for the petitioner, required at 50 CFR 424.14(a). This finding addresses the petition.

    Finding

    Based on our review of the petition and sources cited in the petition, we find that the petition presents substantial scientific or commercial information indicating that the petitioned action may be warranted for the U.S. population of the northwestern moose (Alces alces andersoni) based on factors A, C, D, and E.

    Our explanation for this finding can be found as an appendix at http://www.regulations.gov under Docket No. FWS-R3-ES-2016-0061 under the Supporting Documents section. Thus, for the U.S. population of northwestern moose (Alces alces andersoni), the Service requests information on the five listing factors under section 4(a)(1) of the Act, including the factors identified in this finding and explanation (see Request for Information, above).

    Conclusion

    On the basis of our evaluation of the information presented under section 4(b)(3)(A) of the Act, we have determined that the petition to remove the golden-cheeked warbler from the List of Endangered and Threatened Wildlife does not present substantial scientific or commercial information indicating that the requested action may be warranted. Therefore, we are not initiating a status review for this species.

    We have further determined that the petition to list the U.S. population of northwestern moose (Alces alces andersoni) as an endangered or threatened DPS presents substantial scientific or commercial information indicating that the requested action may be warranted. Because we have found that the petition presents substantial information indicating that the petitioned action may be warranted, we are initiating a status review to determine whether this action under the Act is warranted. At the conclusion of the status review, we will issue a 12-month finding in accordance with section 4(b)(3)(B) of the Act, as to whether or not the Service believes the petitioned action is warranted.

    It is important to note that the “substantial information” standard for a 90-day finding differs from the Act's “best scientific and commercial data” standard that applies to a status review to determine whether a petitioned action is warranted. A 90-day finding does not constitute a status review under the Act. In a 12-month finding, we will determine whether a petitioned action is warranted after we have completed a thorough status review of the species, which is conducted following a substantial 90-day finding. Because the Act's standards for 90-day and 12-month findings are different, as described above, a substantial 90-day finding does not mean that the 12-month finding will result in a finding that the petitioned action is warranted.

    References Cited

    A complete list of references cited is available for each species addressed in this document on the Internet at http://www.regulations.gov and upon request from the appropriate person listed under FOR FURTHER INFORMATION CONTACT, above.

    Authors

    The primary authors of this document are the staff members of the Branch of Recovery and State Grants, Ecological Services Program, U.S. Fish and Wildlife Service.

    Authority

    The authority for these actions is the Endangered Species Act of 1973, as amended (16 U.S.C. 1531 et seq.).

    Dated: May 25, 2016. Stephen Guertin, Acting Director, U.S. Fish and Wildlife Service.
    [FR Doc. 2016-13120 Filed 6-2-16; 8:45 am] BILLING CODE 4333-15-P
    DEPARTMENT OF COMMERCE National Oceanic and Atmospheric Administration 50 CFR Part 226 [Docket No. 150818735-6236-01] RIN 0648-BF28 Endangered and Threatened Species; Designation of Critical Habitat for the Gulf of Maine, New York Bight, and Chesapeake Bay Distinct Population Segments of Atlantic Sturgeon AGENCY:

    National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.

    ACTION:

    Proposed rule; request for comments.

    SUMMARY:

    We, the National Marine Fisheries Service (NMFS), propose to designate critical habitat for the Gulf of Maine, New York Bight, and Chesapeake Bay Distinct Population Segments (DPSs) of Atlantic sturgeon (Acipenser oxyrinchus oxyrinchus). The specific areas proposed for designation include approximately 244 kilometers (152 miles) of aquatic habitat in rivers in Maine, New Hampshire, and Massachusetts for the Gulf of Maine DPS, approximately 547 kilometers (340 miles) of aquatic habitat in rivers in Connecticut, Massachusetts, New York, New Jersey, Pennsylvania, and Delaware for the New York Bight DPS, and approximately 729 kilometers (453 miles) of aquatic habitat in rivers in Maryland, Virginia, and the District of Columbia for the Chesapeake Bay DPS of Atlantic sturgeon. We are soliciting comments from the public on all aspects of the proposal, including information on the economic, national security, and other relevant impacts of the proposed designations, as well as the benefits to the DPSs.

    DATES:

    Comments on this proposed rule must be received by September 1, 2016.

    Public hearings and public information meetings: We will hold two public hearings and two public informational meetings on this proposed rule. We will hold a public informational meeting from 2 to 4 p.m., in Annapolis, Maryland on Wednesday, July 13 (see ADDRESSES). A second public informational meeting will be held from 3 to 5 p.m., in Portland, Maine on Monday, July 18 (see ADDRESSES). We will hold two public hearings, from 3 to 5 p.m. and 6 to 8 p.m., in Gloucester, Massachusetts on Thursday, July 21 (see ADDRESSES).

    ADDRESSES:

    You may submit comments, identified by the NOAA-NMFS-2015-0107, by either of the following methods:

    Electronic Submissions: Submit all electronic public comments via the Federal eRulemaking Portal. Go to www.regulations.gov/#!docketDetail;D=NOAA-NMFS-2015-0107, Click the “Comment Now!” icon, complete the required fields, and enter or attach your comments.

    Mail: Kimberly B. Damon-Randall, Assistant Regional Administrator, Protected Resources Division, NMFS, Greater Atlantic Regional Office, 55 Great Republic Drive, Gloucester, MA 01930.

    Instructions: Comments sent by any other method, to any other address or individual, or received after the end of the comment period, may not be considered by us. All comments received are a part of the public record and will generally be posted for public viewing on www.regulations.gov without change. All personal identifying information (e.g., name, address, etc.), confidential business information, or otherwise sensitive information submitted voluntarily by the sender will be publicly accessible. We will accept anonymous comments (enter “N/A” in the required fields if you wish to remain anonymous).

    Public informational meetings and public hearings: The July 13, 2016, public informational meeting will be held at the Environmental Protection Agency, Information and Conference Center, 410 Severn Avenue, Annapolis, MD 21403. The July 18, 2016, public informational meeting will be held at the Gulf of Maine Research Institute, Cohen Center, 350 Commercial Street, Portland, Maine 04101. The July 21, 2016, public hearings will be held at the NMFS, Greater Atlantic Region Fisheries Office, 55 Great Republic Drive, Gloucester, MA 01930. People needing reasonable accommodations in order to attend and participate or who have questions about the public hearings should contact Lynn Lankshear, NMFS, Greater Atlantic Region Fisheries Office (GARFO), as soon as possible (see FOR FURTHER INFORMATION CONTACT).

    FOR FURTHER INFORMATION CONTACT:

    Lynn Lankshear, NMFS, GARFO at 978-282-8473; Julie Crocker, NMFS, GARFO at 978-282-8480; or Lisa Manning, NMFS, Office of Protected Resources at 301-427-8466.

    SUPPLEMENTARY INFORMATION:

    In accordance with section 4(b)(2) of the ESA (16 U.S.C. 1533(b)(2)) and our implementing regulations (50 CFR 424.12), this proposed rule is based on the best scientific information available concerning the range, biology, habitat, and threats to the habitat for the Gulf of Maine, New York Bight, and Chesapeake Bay DPSs of Atlantic sturgeon. We have reviewed the information (e.g., provided in reports, peer-reviewed literature, and technical documents) and have used it to identify the physical and biological features essential to the conservation of each DPS, the specific areas within the occupied areas that contain the essential physical and biological features that may require special management protection, the federal activities that may impact those features, and the potential impacts of designating critical habitat for each DPS. We have gathered this information for all three DPSs into a single document, the Draft Biological Information and ESA section 4(b)(2) Source Document. The economic impacts of the proposed critical habitat designations for each DPS are described in the document titled, Draft Economic Impact Analysis of Critical Habitat Designation for the Gulf of Maine, New York Bight, and Chesapeake Bay Distinct Population Segments of Atlantic Sturgeon (Acipenser oxyrinchus oxyrinchus), which was prepared by King and Associates, Incorporated. These supporting documents are available on the Federal eRulemaking Portal at http://www.regulations.gov. Electronic copies can also be obtained at http://www.greateratlantic.fisheries.noaa.gov/protected/atlsturgeon/index.html or upon request (see ADDRESSES).

    We invite the submission of information that may help to identify other physical or biological features. For example, while we know that there are specific estuarine areas that sturgeon often use for foraging (e.g., the mouth of the Merrimack and Saco rivers), and we can identify aggregation areas (e.g., off of western Long Island, New York) and general movement patterns in the marine environment (e.g., typically within the 50 meter depth contour) to and from estuarine areas, we could not identify what the specific features are of these habitats that make them important to sturgeon and that may require special management.

    Background

    Under section 4 of the ESA, critical habitat shall be specified to the maximum extent prudent and determinable at the time a species is listed as threatened or endangered (16 U.S.C. 1533(b)(6)(C)). We concluded that critical habitat was not determinable for the Gulf of Maine, New York Bight, and Chesapeake Bay DPSs when we published the final listing rule (77 FR 5880, February 6, 2012). However, we anticipated that critical habitat would be determinable in the future, given on-going research. We, therefore, announced in the final rule that we would propose critical habitat for each DPS in a separate rulemaking.

    Section 3(5)(A) of the ESA defines critical habitat as the specific areas within the geographical area occupied by the species at the time it is listed on which are found those physical or biological features essential to the conservation of the species and which may require special management considerations or protections, and specific areas outside the geographical area occupied by the species at the time it is listed that are essential for the conservation of the species (16 U.S.C. 1532(5)(A)). Conservation is defined in section 3(3) of the ESA as “. . . to use, and the use of, all methods and procedures which are necessary to bring any endangered species or threatened species to the point at which the measures provided pursuant to this Act are no longer necessary . . .” (16 U.S.C. 1532(3)). Therefore, critical habitat is the habitat essential for the species' recovery. However, section 3(5)(C) of the ESA clarifies that except in those circumstances determined by the Secretary, critical habitat shall not include the entire geographical area which can be occupied by the threatened or endangered species.

    As described in section 4(b)(2) of the ESA, we are required to designate critical habitat based on the best available scientific data and after taking into consideration the economic impact, impact on national security, and any other relevant impact, of specifying any particular area as critical habitat. Section 4(b)(2) provides us with discretion to exclude particular areas from a designation if the benefits of excluding that area outweigh the benefits of including it in the designation, unless failure to designate such areas as critical habitat will result in the extinction of the species. Finally, section 4(a)(3)(B) prohibits designating as critical habitat any lands or other geographical areas owned or controlled by the Department of Defense or designated for its use, that are subject to an Integrated Natural Resources Management Plan (INRMP) prepared under section 101 of the Sikes Act (16 U.S.C. 670a), if the Secretary determines in writing that such plan provides a conservation benefit to the species, and its habitat, for which critical habitat is proposed for designation. Although not expressly stated in section 4(b)(2), our regulations clarify that critical habitat shall not be designated within foreign countries or in other areas outside of United States jurisdiction (50 CFR 424.12(g)).

    Once critical habitat is designated, section 7(a)(2) of the ESA requires Federal agencies to ensure that any action they fund, authorize or carry out is not likely to destroy or adversely modify that habitat (16 U.S.C. 1536(a)(2)). This requirement is in addition to the section 7(a)(2) requirement that Federal agencies ensure that their actions are not likely to jeopardize the continued existence of ESA-listed species. Specifying the geographic location of critical habitat also facilitates implementation of section 7(a)(1) of the ESA by identifying areas where Federal agencies can focus their conservation programs and use their authorities to further the purposes of the ESA. Critical habitat requirements do not apply to citizens engaged in activities on private land that do not involve a Federal agency. However, designating critical habitat can help focus the efforts of other conservation partners (e.g., State and local governments, individuals and nongovernmental organizations).

    Accordingly, our step-wise approach for identifying potential critical habitat areas for the Gulf of Maine, New York Bight, and Chesapeake Bay DPSs included the following: (1) Identify the physical and biological features essential to the conservation of the DPS and which may require special management considerations or protection; (2) identify specific areas where those features occur within the occupied geographic range of a particular DPS; (3) identify any unoccupied habitat essential to the conservation of a particular DPS; (4) consider economic, national security, or any other impacts of designating critical habitat and determine whether to exercise our discretion to exclude any particular areas; and (5) determine whether any area that contains essential features is covered under an INRMP that provides a conservation benefit to the DPS.

    Biology and Habitat of the Gulf of Maine, New York Bight, and Chesapeake Bay DPSs of Atlantic Sturgeon

    Although there is considerable variability among species, all sturgeon species (order Acipenseriformes) have some common life history traits. They all: (1) Occur within the Northern Hemisphere; (2) spawn in freshwater over hard bottom substrates; (3) generally do not spawn annually; (4) are benthic foragers; (5) mature relatively late and are relatively long lived; and, (6) are relatively sensitive to low dissolved oxygen levels (Dees, 1961; Vladykov and Greeley, 1963; Klyashtorin, 1976; Bemis and Kynard, 1997; Sulak and Randall, 1999; Billard and Lecointre, 2001; Secor and Niklitschek, 2002; Pikitch et al., 2005).

    Atlantic sturgeon have all of these traits. They occur along the eastern coast of North America from Hamilton Inlet, Labrador, Canada, to Cape Canaveral, Florida, USA (Bigelow and Welsh, 1924; Dees, 1961; Vladykov and Greeley, 1963; Scott and Scott, 1988; NMFS and USFWS, 2007; T. Savoy, CT DEEP, pers. comm.). They have a lifespan of up to 60 years, although the typical lifespan is probably much shorter (Sulak and Randall, 2001; Balazik et al., 2010). As described in the Status Review, Atlantic sturgeon reach maturity at about 5 to 34 years of age, after years of moving between marine waters and coastal estuaries, and spawn in freshwater of tidal-affected rivers every 1 to 5 years (males) or 2 to 5 years (females) (NMFS and USFWS, 2007). Analysis of stomach contents for adults, subadults (i.e., sexually immature Atlantic sturgeon that have emigrated from the natal estuary), and juveniles (i.e., sexually immature Atlantic sturgeon that have not yet emigrated from the natal estuary) confirms that Atlantic sturgeon are benthic foragers (Ryder, 1888; Bigelow and Schroeder, 1953; Johnson et al., 1997; Secor et al., 2000; NMFS and USFWS, 2007; Guilbard et al., 2007; Hatin et al., 2007; Savoy, 2007; Dzaugis, 2013; McLean et al., 2013).

    An anadromous species, Atlantic sturgeon are spawned in freshwater of rivers that flow into a coastal estuary. Tagging records and the relatively low rate of gene flow reported in population genetic studies provide evidence that Atlantic sturgeon return to their natal river to spawn (NMFS and USFWS, 2007). Spawning sites are well-oxygenated areas with flowing water ranging in temperature from 13 °C to 26 °C, and hard bottom substrate such as cobble, coarse sand, hard clay, and bedrock (Ryder, 1888; Dees, 1961; Vladykov and Greeley, 1963; Scott and Crossman, 1973; Gilbert, 1989; Smith and Clugston, 1997; Bain et al. 2000; Collins et al., 2000; Caron et al., 2002; Hatin et al., 2002; Mohler, 2003; Greene et al., 2009; Balazik et al. 2012; Hager et al. 2014). Water depth leading to spawning sites may be highly variable. Since the exact location of spawning is unknown, spawning depth is also uncertain. Atlantic sturgeon in spawning condition have been tracked and captured near presumed spawning habitat at depths up to 27 m (Borodin 1925; Dees 1961; Scott and Crossman 1973; Shirey et al. 1999; Bain et al. 2000; Hatin et al., 2002; Balazik et al., 2012; Hager et al., 2014).

    Within minutes of being fertilized, the eggs become sticky and adhere to the substrate for the relatively short and temperature-dependent period of larval development (Ryder, 1888; Vladykov and Greeley, 1963; Murawski and Pacheco, 1977; Smith et al., 1980; Van den Avyle, 1984; Mohler, 2003). In hatchery studies, hatching occurred approximately 60 hours after egg deposition at water temperatures of 20 °C to 21 °C and 96 hours after egg deposition with a water temperature of approximately 18 °C (Smith et al., 1980; J. Fletcher, USFWS pers. comm. in Mohler, 2003).

    Larval Atlantic sturgeon (i.e., less than 4 weeks old, with total lengths less than 30 mm; Van Eenennaam et al., 1996) are assumed to inhabit the same areas where they were spawned and live at or near the bottom (Ryder, 1888; Smith et al., 1980; Bain et al., 2000; Kynard and Horgan, 2002; Greene et al., 2009). The best available information for behavior of larval Atlantic sturgeon is described from hatchery studies. Upon hatching, larvae are nourished by the yolk sac, are mostly pelagic (e.g., exhibit a “swim-up and drift-down” behavior in hatchery tanks; Mohler, 2003), and move away from light (i.e. negative photo-taxis; Kynard and Horgan, 2002; Mohler, 2003). Within days, larvae exhibit more benthic behavior until the yolk sac is absorbed at about 8 to 10 days post-hatching (Kynard and Horgan, 2002; Mohler, 2003). Post-yolk sac larvae occur in the water column but feed at the bottom of the water column (Mohler, 2003; Richardson et al., 2007).

    The next phase of development, referred to as the juvenile stage, lasts months to years in brackish waters of the natal estuary (Hatin et al., 2007; NMFS and USFWS, 2007; Greene et al., 2009; Calvo et al., 2010; Schueller and Peterson, 2010). Juveniles occur in oligohaline waters (salinity of 0.5 to 5 parts per thousand) and mesohaline waters (salinity of 5 to 18 parts per thousand) of the natal estuary during growth and development. They will eventually move into polyhaline waters (salinity of 18-30 parts per thousand) before emigrating to the marine environment. Larger, presumably older, juveniles occur across a broader salinity range than smaller, presumably younger, juveniles (Hatin et al., 2007; McCord et al., 2007; Munro et al., 2007; NMFS and USFWS, 2007; Sweka et al., 2007; Greene et al., 2009; Calvo et al., 2010).

    The distribution of Atlantic sturgeon juveniles in the natal estuary is a function of physiological development and habitat selection based on water quality factors of temperature, salinity, and dissolved oxygen, which are inter-related environmental variables. In laboratory studies, juveniles less than a year old (also known as young-of-year) had reduced growth at 40 percent dissolved oxygen saturation with salinity of 8 and 15 parts per thousand and temperature at 12 °C, 20 °C, and 28 °C. They grew best at 70 percent dissolved oxygen saturation with salinity of 8 and 15 parts per thousand and temperature of 12 °C and 20 °C (i.e., dissolved oxygen concentrations greater than 6.5 mg/L), and selected for conditions that supported growth (Niklitschek and Secor, 2009; Niklitschek and Secor, 2010). Similar results were obtained for age-1 juveniles (i.e., greater than 1 year old and less than 2 years old), which have been shown to tolerate salinities of 33 parts per thousand (e.g., a salinity level associated with seawater), but grow faster in lower salinity waters (Niklitschek and Secor, 2009; Allen et al., 2014).

    Once suitably developed, Atlantic sturgeon leave the natal estuary and enter marine waters (i.e., waters with salinity greater than 30 parts per thousand) which marks the beginning of the subadult life stage. In the marine environment, subadults mix with adults and subadults from other river systems (NMFS and USFWS, 2007; Grunwald et al., 2008; Dunton et al., 2010; Erickson et al., 2011; Dunton et al., 2012; Wirgin et al., 2012; Waldman et al., 2013; O'Leary et al., 2014, Wirgin et al., 2015a; Wirgin et al., 2015b). Atlantic sturgeon travel long distances in marine waters, aggregate in both ocean and estuarine areas at certain times of the year, and exhibit seasonal coastal movements in the spring and fall (NMFS and USFWS, 2007; Dunton et al., 2010; Dunton et al., 2012; Erickson et al., 2011; Oliver et al., 2013; Wippelhauser and Squiers, 2015). Existing and new technologies are providing additional information for the life history and distribution of the Atlantic sturgeon in marine waters (Nelson et al., 2013; Breece et al., 2016). However, there is still a paucity of data to inform distribution of subadult and adult Atlantic sturgeon within the marine environment and their habitat use.

    The exact spawning locations for Gulf of Maine, New York Bight and Chesapeake Bay DPS Atlantic sturgeon are unknown but inferred based on the location of freshwater, hard substrate, water depth, tracking of adults to upriver locations and the behavior of adults at those locations, capture of young-of-year and, in limited cases, larvae, and historical accounts of where the caviar fishery occurred. Based on one or more of these lines of evidence, multiple sites have been identified within many of the rivers used for spawning (NMFS and USFWS, 2007; Simpson, 2008; Hager, 2011; Austin, 2012; Balazik et al., 2012; Breece et al., 2013). Spawning sites at different locations within the tidal-affected river would help to ensure successful spawning given annual changes in the location of the salt wedge.

    Male Atlantic sturgeon in spawning condition have been observed to stage in more saline waters of the coastal estuary before moving upriver once the water temperature reaches approximately 6 °C (43 °F). They may spend weeks moving upstream and downstream of the presumed spawning area(s) before moving back downriver to the lower estuary and residing there until outmigration in the fall. In contrast, spawning females move upriver when temperatures are closer to 12 °C to 13 °C (54 ° to 55 ° F), return downriver relatively quickly, and may leave the estuary and travel to other coastal estuaries until outmigration to marine waters in the fall (Smith et al., 1982; Dovel and Berggren, 1983; Smith, 1985; Bain, 1997; Bain et al., 2000; Collins et al., 2000; NMFS and USFWS, 2007; Greene et al., 2009; Balazik et al., 2012; Breece et al., 2013).

    There is a growing body of evidence that some Atlantic sturgeon river populations have two spawning seasons comprised of different spawning adults (Balazik and Musick, 2015). Evidence of fall spawning for the Carolina and South Atlantic DPSs was available when the five Atlantic sturgeon DPSs were listed under the ESA (77 FR 5914; Smith et al., 1984; NMFS and USFWS 1998; Collins et al., 2000). Since the listings, additional evidence of fall as well as spring spawning has been obtained for the Chesapeake Bay DPS (Balazik et al., 2012; Hager et al. 2014; Kahn et al., 2014). Spring is the only currently known spawning period for the Gulf of Maine and New York Bight DPSs. However, an 1870's report of Atlantic sturgeon spawning during August in the Hudson River (Dovel and Berggren, 1983) and other historical information (Borodin, 1925; Balazik and Musick, 2015) suggests spring and fall spawning runs were typical, and may still occur in many areas of the Atlantic sturgeon's range. Given seasonal changes in the location of the salt-wedge for estuarine systems, it is likely that fall spawning would occur or would have occurred further upstream than the locations for spring spawning in rivers.

    In addition to providing access to spawning habitat, estuaries provide foraging opportunities for subadult and adult Atlantic sturgeon. Stomach content analysis of Atlantic sturgeon captured in coastal estuaries confirm that sturgeon are foraging in coastal estuaries (Hatin et al., 2007; Savoy, 2007; Calvo et al., 2010; Wippelhauser, 2012; Dzaugis, 2013; McLean et al., 2013; McLean et al., 2014). The occurrence of subadult and adults in association with the salt front (Brundage and Meadows, 1982; Savoy and Shake, 1993; Collins et al. 2000; Savoy and Pacileo, 2003; Hatin et al., 2007; Calvo et al., 2010; Hager, 2011; Balazik, 2012; Breece et al., 2013), a biologically-rich area of estuaries, also suggests use of estuarine waters for seasonal foraging. At least some Atlantic sturgeon subadults and adults move between estuarine environments in the spring through fall (Savoy and Pacileo, 2003; Simpson, 2008; Collins et al., 2000; Balazik et al., 2012).

    The directed movement of subadult and adult Atlantic sturgeon to coastal estuaries in the spring is reversed in the fall (NMFS and USFWS, 2007; Greene et al., 2009; Hager, 2011; Erickson et al., 2011; Balazik et al., 2012; Wippelhauser, 2012; Oliver et al., 2013). The whereabouts of these fish once they leave coastal estuaries is uncertain. Atlantic sturgeon aggregate off of Long Island, New York and off of the Virginia/North Carolina coastline (Laney et al., 2007; Dunton et al., 2015). Others have been tracked to the southern extent of the range (T. Savoy, CT DEEP, pers. comm.) while at least one was tracked to the more northern area of the subspecies range, the Back River, Maine, in winter (G. Zydlewski, Univ. of Maine, pers. comm.). Two adults originally tagged in the Delaware River were detected in the Appomattox River, Virginia (C. Hager, Chesapeake Scientific, pers. comm.) during the winter. A recent study of Atlantic sturgeon tracked in the Delaware Bay found that some of the fish migrating from the estuary in the fall remained in nearby coastal marine waters within a plume of water flowing out from the estuary, suggesting a continued affinity with the estuary even after emigrating from the estuary proper (Oliver et al., 2013). Further work suggests Atlantic sturgeon distribution in the marine environment is affected more by the characteristics of the water (e.g., eddies, coastal upwelling, temperature) than characteristics of the landscape (e.g., depth, substrate) (Breece et al., 2016).

    To identify specific habitats used by an Atlantic sturgeon DPS, we considered available information that described: (1) Capture location and/or tracking locations of a subadult or adult Atlantic sturgeon identified to its DPS by genetic analysis; (2) capture location and/or tracking locations of a subadult or adult Atlantic sturgeon identified to its DPS based on the presence of a tag that was applied when the sturgeon was captured as a juvenile in its natal estuary; (3) capture or detection location of adults in spawning condition (i.e., extruding eggs or milt) or post-spawning condition (e.g., concave abdomen for females); (4) capture or detection of young-of year and other juvenile age classes; and, (5) collection of eggs or larvae. In the case of estuaries of known spawning rivers, we assumed based on the available information that a portion of the subadults and adults present originated from that river and, thus, the habitats used by subadults and adults in a spawning river were indicative of habitats used by the DPS which spawned in the river. Previous studies have demonstrated that a combination of microsatellite and mitochondrial DNA analyses provide the most accurate information to identify an Atlantic sturgeon to its DPS, and using mitochondrial analysis, alone, provides much lower assignment accuracy given the prevalence of a common Atlantic sturgeon haplotype (NMFS and USFWS, 2007; Wirgin et al., 2012; Waldman et al., 2013). Therefore, when reviewing the available information on habitats used by Atlantic sturgeon, we also considered what genetic analyses were used to assign the sampled sturgeon to its DPS of origin.

    The Kennebec River was the only known spawning river for the Gulf of Maine DPS when the DPS was listed as threatened (NMFS and USFWS, 2007; 77 FR 5880, February 6, 2012). Spawning has since been confirmed in the Androscoggin River (Wippelhauser, 2012). The Brunswick Dam at Pejepscot Falls, the head-of-tide, is the upstream limit of Atlantic sturgeon distribution in the Androscoggin River. The dam is located approximately 10 kilometers upstream of the confluence of the Kennebec and Androscoggin rivers (ASMFC, 1998; NMFS and USFWS, 2007; NMFS, 2013; Wippelhauser and Squiers, 2015). The Lockwood Dam at river kilometer 103 is the current upstream limit for Atlantic sturgeon in the Kennebec River; it is located at the site of a natural falls (NMFS and USFWS, 2007). From 1837 to 1999, the Edwards Dam was the upstream limit of Atlantic sturgeon in the Kennebec River. Located near the head-of-tide, approximately 29 kilometers downstream of the Lockwood Dam at Augusta, the Edwards Dam (rkm 74) prevented Atlantic sturgeon from accessing historical habitat. Sturgeon were sighted above the former Edwards Dam site after removal of the dam and in June 2005, an Atlantic sturgeon was incidentally captured at river kilometer 102 (NMFS and USFWS, 2007; Wippelhauser, 2012).

    Substrate type in the Kennebec estuary is largely sand and bedrock (Fenster and Fitzgerald, 1996; Moore and Reblin, 2008). Mesohaline waters occur upstream of Doubling Point during summer low flows, transitioning to oligohaline waters and then essentially tidal freshwater from Chops Point (the outlet of Merrymeeting Bay) upriver to the head-of tide on the Kennebec and Androscoggin rivers (ASMFC, 1998; Kistner and Pettigrew, 2001). A thorough description of the Kennebec Estuary is provided in Moore and Reblin 2008.

    During the period 1977-2001, Atlantic sturgeon in spawning condition (i.e., ripe males releasing sperm) or of size presumed to be sexually mature adults (i.e., greater than 150 cm total length) were caught between river kilometers 52.8 and 74 of the Kennebec River during the months of June and July, the likely spawning season. From 2009 to 2011, 31 sturgeon, including 6 ripe males, were caught in the Kennebec River between river kilometers 70 and 75 (Wippelhauser, 2012; Wippelhauser and Squiers, 2015). Sturgeon in the Upper Kennebec Estuary (defined as river kilometer 45 to river kilometer 74 at head-of tide in the cited document) repeatedly moved between river kilometers 48 and 75 (Wippelhauser, 2012). An additional eight sturgeon, including one ripe male, were caught in the Androscoggin in June and July of 2009-2011 (Wippelhauser, 2012). Three larvae were also captured in the Upper Kennebec Estuary, 1 to 1.6 river kilometers upstream of river kilometer 74, the former Edwards Dam site (Wippelhauser, 2012).

    The Merrymeeting Bay and Lower Kennebec Estuary are used by post-spawn adults, juveniles, and other life stages at least as late as November, and some Atlantic sturgeon may overwinter in Merrymeeting Bay (Wippelhauser, 2012). Sturgeon captured and tagged in the Saco and Penobscot rivers are also detected in the Kennebec Estuary, typically Merrymeeting Bay and downstream locations, although at least one male, captured in the Saco in 2010, was the single ripe male also captured in the Androscoggin suggesting that the Saco and Penobscot are important habitat areas for the Androscoggin spawning population (Wippelhauser, 2012). However, genetic information identifying the river of origin of the Atlantic sturgeon is not yet available.

    While there is no current evidence that Atlantic sturgeon are spawning in Gulf of Maine rivers other than the Kennebec and Androscoggin, captures of sturgeon in the Merrimack and Penobscot Rivers as well as the presence of the features necessary to support reproduction and recruitment in these rivers indicate that there is the potential for spawning to occur (Kieffer and Kynard, 1993; Fernandes et al., 2010; Wippelhauser, 2012). The 1998 and 2007 status reviews for Atlantic sturgeon described information for presence of Atlantic sturgeon in the Piscataqua River, including capture of a large female Atlantic sturgeon in spawning condition in 1990. The presence of this female (NMFS and USFWS, 1998; ASSRT, 2007) as well as the presence of the features necessary to support reproduction and recruitment in this river indicates that there is the potential for spawning to occur in the Piscataqua.

    Genetic information is available for Atlantic sturgeon captured in six specific areas of the marine range: Minas Basin, Bay of Fundy, Canada; the Connecticut River estuary; Long Island Sound; the Atlantic Ocean off of Rockaway, New York; the Atlantic Ocean off of Delaware Bay; and, the Atlantic Ocean off of Virginia/North Carolina (Laney et al., 2007; Wirgin et al., 2012; Waldman et al., 2013; O'Leary et al., 2014; Wirgin et al., 2015a). Atlantic sturgeon belonging to the Gulf of Maine DPS comprised 35 percent of the Minas Basin, Bay of Fundy samples collected in the summer, suggesting this is an important foraging area for the Gulf of Maine DPS. The DPS comprised less than 2 percent to 14.5 percent of Atlantic sturgeon sampled in the Connecticut River, Long Island Sound, the Atlantic Ocean off of Rockaway, New York, and the Atlantic Ocean off of Delaware Bay. The DPS was not detected in the sampled Atlantic sturgeon incidentally captured during winter from waters off of Virginia/North Carolina.

    At the time of listing, the Delaware and Hudson rivers were the only known spawning rivers for the New York Bight DPS of Atlantic sturgeon (Dovel and Berggren, 1983; Bain, 1998; Kahnle et al., 1998; NMFS and USFWS, 2007; Calvo et al., 2010). In spring 2014, several small Atlantic sturgeon were captured in the Connecticut River (T. Savoy, CT DEEP, pers. comm.). We presume these to be juveniles less than a year old based on their apparent size seen in a photo provided in the Connecticut Weekly Diadromous Fish Report, report date May 20, 2014. Though it was previously thought that the Atlantic sturgeon population in the Connecticut had been extirpated (Savoy and Pacileo, 2003; NMFS and USFWS, 2007), capture of these juvenile Atlantic sturgeon strongly suggests that spawning is occurring in this river. For the Housatonic River, the 1998 and 2007 status reviews for Atlantic sturgeon described information for historical presence of Atlantic sturgeon in that river, including Whitworth's (1996) reference to a large fishing industry for Atlantic sturgeon (NMFs and USFWS, 1998; NMFS and USFWS, 2007). Since the commercial fisheries targeted spawning sturgeon, historical captures of sturgeon in the Housatonic River as well as the presence of the features necessary to support reproduction and recruitment in this river indicates that there is the potential for spawning to occur in the Housatonic.

    The Hudson River is one of the most studied areas for Atlantic sturgeon. The upstream limit for Atlantic sturgeon on the Hudson River is the Federal Dam at the fall line, approximately river kilometer 246 (Dovel and Berggren, 1983; Bain, 1998; Kahnle et al., 1998; Everly and Boreman, 1999). Recent tracking data indicate Atlantic sturgeon presence at this upstream limit (D. Fox, DESU, pers. comm.). Sturgeon occurring in the upstream limits of the river are suspected, but not yet confirmed, to belong to the New York Bight DPS.

    Spawning may occur in multiple sites within the river (Dovel and Berggren, 1983; Van Eenennaam et al., 1996; Kahnle et al., 1998; Bain et al., 2000). The area around Hyde Park (approximately river kilometer 134) is considered a likely spawning area based on scientific studies and historical records of the Hudson River sturgeon fishery (Dovel and Berggren, 1983; Van Eenennaam et al., 1996; Kahnle et al., 1998; Bain et al., 2000). Habitat conditions at the Hyde Park site are described as freshwater year round with substrate, including bedrock, and waters depths of 12 to 24 meters (Bain et al., 2000). Similar conditions occur at river kilometer 112, an area of freshwater and water depths of 21 to 27 meters (Bain et al., 2000).

    Catches of Atlantic sturgeon less than 63 cm fork length suggest that these sexually immature fish utilize the Hudson River estuary from the Tappan Zee (river kilometer 40) through Kingston (river kilometer 148) (Dovel and Berggren, 1983; Haley, 1999; Bain et al., 2000). Sea