Federal Register Vol. 81, No.114,

Federal Register Volume 81, Issue 114 (June 14, 2016)

Page Range38569-38879
FR Document

81_FR_114
Current View
Page and SubjectPDF
81 FR 38877 - Continuation of the National Emergency With Respect to the Actions and Policies of Certain Members of the Government of Belarus and Other Persons to Undermine Belarus's Democratic Processes or InstitutionsPDF
81 FR 38698 - Sunshine Act Meeting NoticePDF
81 FR 38774 - Proposed Information Collection; Comment RequestPDF
81 FR 38645 - Removal of Title V Emergency Affirmative Defense Provisions From State Operating Permit Programs and Federal Operating Permit ProgramPDF
81 FR 38703 - EPA's Review of the Waste Isolation Pilot Plant's Biennial Environmental Compliance Report for the Period 2012 to 2014PDF
81 FR 38585 - Grants to Tribal Colleges and Universities and Diné CollegePDF
81 FR 38751 - Sunshine Act MeetingPDF
81 FR 38657 - Notice of Request for Extension of Approval of an Information Collection; Importation of Live Swine, Pork and Pork Products, and Swine Semen From the European UnionPDF
81 FR 38739 - United States Department of the Interior, United States Geological Survey TRIGA Research ReactorPDF
81 FR 38705 - Sunshine Act MeetingsPDF
81 FR 38736 - Establishment of MCC Advisory Council and Call for NominationsPDF
81 FR 38725 - Cooperative Research and Development Agreement: Diesel Outboard Engine DevelopmentPDF
81 FR 38723 - Limited Purpose Cooperative Research and Development Agreement-UAS Research With the University of Massachusetts AmherstPDF
81 FR 38671 - Countervailing Duty Investigation of Certain Corrosion-Resistant Steel Products From India: Notice of Correction to Final Affirmative Determination; Negative Determination of Critical CircumstancesPDF
81 FR 38772 - Notice of Land Use Change and Release of Grant Assurance Restrictions at the Sacramento International Airport (SMF), Sacramento, CaliforniaPDF
81 FR 38730 - Notice of Neighborhood Stabilization Program; Changes to Closeout Requirements Related to Program IncomePDF
81 FR 38663 - Certain Preserved Mushrooms From India: Rescission of Antidumping Duty Administrative Review; 2015-2016PDF
81 FR 38670 - Pure Magnesium From the People's Republic of China: Final Results of Antidumping Duty Administrative Review; 2014-2015PDF
81 FR 38671 - Narrow Woven Ribbon With Woven Selvedge From the People's Republic of China: Preliminary Results of Administrative Review; 2014-2015PDF
81 FR 38673 - Diamond Sawblades and Parts Thereof From the People's Republic of China: Final Results of Antidumping Duty Administrative Review; 2013-2014PDF
81 FR 38664 - Aluminum Extrusions From the People's Republic of China: Preliminary Results of Antidumping Duty Administrative Review and Rescission of Review in Part; 2014-2015PDF
81 FR 38714 - Office of Urban Indian Health Programs; Urban Indian Education and Research Organization Cooperative Agreement Program Announcement Type: New and Competing Continuation Funding Announcement Number: HHS-2016-IHS-UIHP3-0001; Catalog of Federal Domestic Assistance Number: 93.193PDF
81 FR 38702 - Notice of Availability of the Environmental Protection Agency's Two Updated Chapters in the EPA Air Pollution Control Cost ManualPDF
81 FR 38738 - Information Collection: Nondiscrimination on the Basis of Sex in Education Programs or Activities Receiving Federal Financial AssistancePDF
81 FR 38726 - Cooperative Research and Development Agreement: Laser Eye ProtectionPDF
81 FR 38704 - Pesticides; Draft Guidance for Pesticide Registrants on the Determination of Minor UsePDF
81 FR 38732 - Agency Information Collection Activities: Request for CommentsPDF
81 FR 38569 - Civil Penalty Inflation AdjustmentsPDF
81 FR 38595 - Safety Zones; Coast Guard Sector Ohio Valley Annual and Recurring Safety Zones UpdatePDF
81 FR 38689 - Agency Information Collection Activities: Notice of Intent To Renew Collection 3038-0099, Process for a Swap Execution Facility or Designated Contract Market To Make a Swap Available To TradePDF
81 FR 38733 - Proclaiming Certain Lands as Reservation for the Bay Mills Indian CommunityPDF
81 FR 38599 - Safety Zone; Ohio River Mile 43.2 to Mile 43.6, East Liverpool, OHPDF
81 FR 38770 - Texas Disaster #TX-00473PDF
81 FR 38691 - Agency Information Collection Activities: Comment RequestPDF
81 FR 38690 - Agency Information Collection Activities: Submission for OMB Review; Comment RequestPDF
81 FR 38771 - Mississippi Disaster #MS-00086PDF
81 FR 38770 - Virginia Disaster #VA-00062PDF
81 FR 38610 - Chronic Beryllium Disease Prevention Program; CorrectionPDF
81 FR 38694 - Notice of Public Meeting To Inform the Human Reliability ProgramPDF
81 FR 38769 - Data Collection Available for Public CommentsPDF
81 FR 38710 - Arthritis Advisory Committee; Notice of MeetingPDF
81 FR 38705 - Proposed Data Collection Submitted for Public Comment and RecommendationsPDF
81 FR 38676 - Marine Mammal Stock Assessment ReportsPDF
81 FR 38734 - Notice of Inventory Completion: Office of the State Archaeologist, University of Iowa, Iowa City, IAPDF
81 FR 38770 - Data Collection Available for Public CommentsPDF
81 FR 38735 - Certain L-Tryptophan, L-Tryptophan Products, and Their Methods of Production Institution of InvestigationPDF
81 FR 38637 - Consistent Basis Reporting Between Estate and Person Acquiring Property From Decedent; HearingPDF
81 FR 38660 - Announcement of Application Deadlines and Requirements for Section 313A Guarantees for Bonds and Notes Issued for Electrification or Telephone Purposes Loan Program for Fiscal Year (FY) 2016PDF
81 FR 38658 - Agency Information Collection Activities: Proposed Collection: Comment Request-Professional Standards Training Tracker ToolPDF
81 FR 38656 - Notice of Request for Renewal of a Recordkeeping BurdenPDF
81 FR 38610 - Enhanced Prudential Standards for Systemically Important Insurance CompaniesPDF
81 FR 38631 - Capital Requirements for Supervised Institutions Significantly Engaged in Insurance ActivitiesPDF
81 FR 38727 - Agency Information Collection Activities: Application To Use the Automated Commercial Environment (ACE)PDF
81 FR 38729 - Agency Information Collection Activities: Request for InformationPDF
81 FR 38728 - Agency Information Collection Activities: Declaration for Free Entry of Unaccompanied ArticlesPDF
81 FR 38772 - Volkswagen Group of America, Inc., Receipt of Petition for Decision of Inconsequential NoncompliancePDF
81 FR 38709 - Proposed Information Collection Activity: Comment RequestPDF
81 FR 38713 - Health IT Policy Committee Advisory Meeting; Notice of MeetingPDF
81 FR 38712 - Health IT Standards Committee Advisory Meeting; Notice of MeetingPDF
81 FR 38638 - Safety Zone; Fourth of July Fireworks Patriots Point, Charleston, SCPDF
81 FR 38707 - Advisory Councils or Committees; Delegation of AuthorityPDF
81 FR 38659 - Notice of Proposed New Fee Site; Federal Lands Recreation Enhancement ActPDF
81 FR 38773 - Port Performance Freight Statistics Working GroupPDF
81 FR 38711 - Osteoporosis: Nonclinical Evaluation of Drugs Intended for Treatment; Draft Guidance for Industry; AvailabilityPDF
81 FR 38595 - Drawbridge Operation Regulation; Middle River, Between Bacon Island and Lower Jones Tract, CaliforniaPDF
81 FR 38734 - Sport Fishing and Boating Partnership Council CharterPDF
81 FR 38660 - Chippewa National Forest Resource Advisory CommitteePDF
81 FR 38592 - Renaming of Sector Baltimore as Sector Maryland-National Capital Region; Conforming AmendmentsPDF
81 FR 38707 - Proposed Data Collection Submitted for Public Comment and RecommendationsPDF
81 FR 38699 - Notice of Effectiveness of Exempt Wholesale Generator StatusPDF
81 FR 38695 - Combined Notice of Filings #1PDF
81 FR 38691 - Proposed Collection; Comment RequestPDF
81 FR 38735 - Certain Corrosion-Resistant Steel Products From Taiwan; Termination of InvestigationPDF
81 FR 38699 - FirstLight Hydro Generating Company; Notice of Application Accepted for Filing and Soliciting Comments, Motions To Intervene, and ProtestsPDF
81 FR 38700 - Erie Boulevard Hydropower, L.P.; Notice of Application for Amendment of License Modifying Flashboard System and Flow Discharge Location under Article 405, and Soliciting Comments, Motions To Intervene and ProtestsPDF
81 FR 38696 - Commission Information Collection Activities (FERC Form 6-Q); Comment RequestPDF
81 FR 38696 - Tektronix, Inc.; Notice of FilingPDF
81 FR 38700 - Benton Falls Associates, New York LP; Benton Falls Associates, Maine LP; Notice of Application for Transfer of License and Soliciting Comments, Motions To Intervene, and ProtestsPDF
81 FR 38697 - North Hartland, LLC-New Hampshire, North Hartland, LLC-Vermont; Notice of Application for Transfer of License and Soliciting Comments, Motions To Intervene, and ProtestsPDF
81 FR 38689 - Commerce Spectrum Management Advisory CommitteePDF
81 FR 38692 - Proposed Collection; Comment RequestPDF
81 FR 38675 - Endangered Species; File No. 19281PDF
81 FR 38746 - ETF Managers Group LLC, et al.; Notice of ApplicationPDF
81 FR 38751 - Self-Regulatory Organizations; Miami International Securities Exchange LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Adopt Exchange Rule 519C, Mass Cancellation of Trading InterestPDF
81 FR 38759 - Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing of Amendment No. 6 to a Proposed Rule Change To Amend NYSE Arca Equities Rule 8.600 To Adopt Generic Listing Standards for Managed Fund SharesPDF
81 FR 38747 - Self-Regulatory Organizations; New York Stock Exchange LLC; NYSE MKT LLC; Notice of Filings of Amendment No. 1, and Order Granting Accelerated Approval of Proposed Rule Changes, as Modified by Amendment No. 1, To Provide for How the Exchanges Would Determine an Official Closing Price if the Exchanges Are Unable To Conduct a Closing TransactionPDF
81 FR 38755 - Self-Regulatory Organizations; The Nasdaq Stock Market LLC; Notice of Filing of Amendment No. 1, and Order Granting Accelerated Approval of a Proposed Rule Change, as Modified by Amendment No. 1, To Establish Secondary Contingency Procedures for the Exchange's Closing CrossPDF
81 FR 38758 - Self-Regulatory Organizations; Chicago Board Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Relating to the Penny Pilot ProgramPDF
81 FR 38753 - Self-Regulatory Organizations; C2 Options Exchange, Incorporated; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change Relating to the Penny Pilot ProgramPDF
81 FR 38699 - Northampton Generating Company, L.P.; Notice of Institution of Section 206 Proceeding and Refund Effective DatePDF
81 FR 38701 - Combined Notice of Filings #1PDF
81 FR 38693 - Proposed Collection; Comment RequestPDF
81 FR 38771 - Petition for Exemption; Summary of Petition Received; Raytheon Space and Airborne SystemsPDF
81 FR 38572 - Acceptance Criteria for Portable Oxygen Concentrators Used On Board Aircraft; CorrectionPDF
81 FR 38694 - Submission for OMB Review; Comment RequestPDF
81 FR 38737 - Agency Information Collection Activities: Proposed Collection; Comment Request; Supervisory Committee Audits and VerificationsPDF
81 FR 38738 - Submission for OMB Review; Comment RequestPDF
81 FR 38745 - New Postal ProductPDF
81 FR 38580 - Modification of VOR Federal Airway V-552; MississippiPDF
81 FR 38723 - National Institute of Neurological Disorders and Stroke; Notice of Closed MeetingsPDF
81 FR 38604 - Clofentezine; Pesticide TolerancesPDF
81 FR 38601 - Chlorantraniliprole; Pesticide TolerancesPDF
81 FR 38694 - Notice of Additional Public Meeting-Draft Environmental Impact Statement for the Lower Yellowstone Intake Diversion Dam Fish Passage Project, Dawson County, MontanaPDF
81 FR 38577 - Airworthiness Directives; Airbus AirplanesPDF
81 FR 38573 - Airworthiness Directives; Airbus AirplanesPDF
81 FR 38777 - Indian Child Welfare Act ProceedingsPDF
81 FR 38581 - Continuum of Care Program-Increasing Mobility Options for Homeless Individuals and Families With Tenant-Based Rental AssistancePDF
81 FR 38640 - Rescission of Preconstruction Permits Issued Under the Clean Air ActPDF

Issue

81 114 Tuesday, June 14, 2016 Contents Agricultural Marketing Agricultural Marketing Service NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 38656-38657 2016-14007 Agriculture Agriculture Department See

Agricultural Marketing Service

See

Animal and Plant Health Inspection Service

See

Food and Nutrition Service

See

Forest Service

See

Rural Utilities Service

Animal Animal and Plant Health Inspection Service NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Importation of Live Swine, Pork and Pork Products, and Swine Semen from the European Union, 38657-38658 2016-14079 Army Army Department NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 38691-38692 2016-13979 Consumer Financial Protection Bureau of Consumer Financial Protection RULES Civil Penalty Inflation Adjustments, 38569-38572 2016-14031 NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 38690-38691 2016-14024 2016-14025 Centers Disease Centers for Disease Control and Prevention NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 38705-38709 2016-13982 2016-14016 Delegations of Authority: Advisory Councils or Committees, 38707 2016-13995 Children Children and Families Administration NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 38709-38710 2016-13999 Coast Guard Coast Guard RULES Drawbridge Operations: Middle River, between Bacon Island and Lower Jones Tract, CA, 38595 2016-13987 Renaming of Sector Baltimore as Sector Maryland-National Capital Region; Conforming Amendments, 38592-38595 2016-13983 Safety Zones: Coast Guard Sector Ohio Valley Annual and Recurring Safety Zones Update, 38595-38599 2016-14030 Ohio River mile 43.2 to mile 43.6, East Liverpool, OH, 38599-38601 2016-14027 PROPOSED RULES Safety Zones: Fourth of July Fireworks Patriots Point, Charleston, SC, 38638-38640 2016-13996 NOTICES Cooperative Research and Development Agreements: Diesel Outboard Engine Development, 38725-38726 2016-14074 Laser Eye Protection, 38726-38727 2016-14038 UAS Research with University of Massachusetts Amherst; Limited Purpose, 38723-38725 2016-14073 Commerce Commerce Department See

International Trade Administration

See

National Oceanic and Atmospheric Administration

See

National Telecommunications and Information Administration

Commodity Futures Commodity Futures Trading Commission NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Process for a Swap Execution Facility or Designated Contract Market to Make a Swap Available to Trade, 38689-38690 2016-14029 Defense Department Defense Department See

Army Department

See

Engineers Corps

NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 38692-38694 2016-13951 2016-13958 2016-13970
Energy Department Energy Department See

Federal Energy Regulatory Commission

PROPOSED RULES Chronic Beryllium Disease Prevention Program; Correction, 38610 2016-14020 NOTICES Meetings: Human Reliability Program, 38694-38695 2016-14019
Engineers Engineers Corps NOTICES Environmental Impact Statements; Availability, etc.: Lower Yellowstone Intake Diversion Dam Fish Passage Project, Dawson County, MT; Meeting, 38694 2016-13883 Environmental Protection Environmental Protection Agency RULES Pesticide Tolerances: Chlorantraniliprole, 38601-38604 2016-13910 Clofentezine, 38604-38609 2016-13911 PROPOSED RULES Removal of Title V Emergency Affirmative Defense Provisions from State Operating Permit Programs and Federal Operating Permit Program, 38645-38655 2016-14104 Rescission of Preconstruction Permits Issued under the Clean Air Act, 38640-38645 2016-13303 NOTICES Air Pollution Control Cost Manual, 38702-38703 2016-14042 Pesticides: Draft Guidance for Pesticide Registrants on the Determination of Minor Use, 38704-38705 2016-14037 Review of Waste Isolation Pilot Plant's Biennial Environmental Compliance Report for the Period 2012-2014, 38703-38704 2016-14095 Federal Aviation Federal Aviation Administration RULES Acceptance Criteria for Portable Oxygen Concentrators Used On Board Aircraft; Correction, 38572-38573 2016-13955 Airworthiness Directives: Airbus Airplanes, 38573-38580 2016-13856 2016-13857 Modification of VOR Federal Airways: V-552, Mississippi, 38580-38581 2016-13938 NOTICES Land Use Changes and Releases of Grant Assurance Restrictions: Sacramento International Airport, Sacramento, CA, 38772 2016-14069 Petitions for Exemptions: Raytheon Space and Airborne Systems, 38771-38772 2016-13957 Federal Election Federal Election Commission NOTICES Meetings; Sunshine Act, 38705 2016-14077 Federal Energy Federal Energy Regulatory Commission NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 38696-38697 2016-13975 Applications: Benton Falls Associates, New York LP; Benton Falls Associates, Maine LP, 38700 2016-13973 Erie Boulevard Hydropower, LP, 38700-38701 2016-13976 FirstLight Hydro Generating Co., 38699-38700 2016-13977 Combined Filings, 38695-38696, 38701-38702 2016-13959 2016-13980 Effectiveness of Exempt Wholesale Generator Status: Golden Fields Solar I, LLC, et al., 38699 2016-13981 Filings: Tektronix, Inc., 38696 2016-13974 License Transfer Applications: North Hartland, LLC, New Hampshire; North Hartland, LLC, Vermont, 38697 2016-13972 Meetings; Sunshine Act, 38698-38699 2016-14145 Refund Effective Dates: Northampton Generating Co., LP, 38699 2016-13960 Federal Reserve Federal Reserve System PROPOSED RULES Capital Requirements for Supervised Institutions Significantly Engaged in Insurance Activities, 38631-38637 2016-14004 Enhanced Prudential Standards for Systemically Important Insurance Companies, 38610-38631 2016-14005 Food and Drug Food and Drug Administration NOTICES Guidance: Osteoporosis: Nonclinical Evaluation of Drugs Intended for Treatment, 38711-38712 2016-13988 Meetings: Arthritis Advisory Committee, 38710-38711 2016-14017 Food and Nutrition Food and Nutrition Service NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Professional Standards Training Tracker Tool, 38658-38659 2016-14008 Forest Forest Service NOTICES Meetings: Chippewa National Forest Resource Advisory Committee, 38660 2016-13985 New Fee Site: Federal Lands Recreation Enhancement Act, 38659-38660 2016-13992 Geological Geological Survey NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 38732-38733 2016-14033 Health and Human Health and Human Services Department See

Centers for Disease Control and Prevention

See

Children and Families Administration

See

Food and Drug Administration

See

Indian Health Service

See

National Institutes of Health

NOTICES Meetings: Health IT Policy Committee Advisory, 38713 2016-13998 Health IT Standards Committee Advisory, 38712-38713 2016-13997
Homeland Homeland Security Department See

Coast Guard

See

U.S. Customs and Border Protection

Housing Housing and Urban Development Department RULES Continuum of Care Program: Increasing Mobility Options for Homeless Individuals and Families with Tenant-Based Rental Assistance, 38581-38585 2016-13684 NOTICES Neighborhood Stabilization Program: Changes to Closeout Requirements Related to Program Income, 38730-38732 2016-14062 Indian Affairs Indian Affairs Bureau RULES Grants to Tribal Colleges and Universities and Dine College, 38585-38592 2016-14094 Indian Child Welfare Act Proceedings, 38778-38876 2016-13686 NOTICES Proclaiming Certain Lands as Reservations: Bay Mills Indian Community, 38733-38734 2016-14028 Indian Health Indian Health Service NOTICES Funding Availabilities: Urban Indian Education and Research Organization Cooperative Agreement Program, 38714-38723 2016-14043 Interior Interior Department See

Geological Survey

See

Indian Affairs Bureau

See

National Park Service

NOTICES Charter Renewals: Sport Fishing and Boating Partnership Council, 38734 2016-13986
Internal Revenue Internal Revenue Service PROPOSED RULES Consistent Basis Reporting Between Estate and Person Acquiring Property from Decedent; Hearing, 38637-38638 2016-14010 NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 38774-38775 2016-14108 International Trade Adm International Trade Administration NOTICES Antidumping or Countervailing Duty Investigations, Orders, or Reviews: Aluminum Extrusions from the People's Republic of China, 38664-38670 2016-14046 Corrosion-Resistant Steel Products from India Japan, 38671 2016-14072 Diamond Sawblades and Parts Thereof from the People's Republic of China, 38673-38675 2016-14047 Narrow Woven Ribbon with Woven Selvedge from the People's Republic of China, 38671-38673 2016-14048 Preserved Mushrooms from India, 38663-38664 2016-14061 Pure Magnesium from the People's Republic of China, 38670-38671 2016-14059 International Trade Com International Trade Commission NOTICES Investigations; Determinations, Modifications, and Rulings, etc.: Corrosion-Resistant Steel Products from Taiwan, 38735 2016-13978 L-Tryptophan, L-Tryptophan Products, and Their Methods of Production, 38735-38736 2016-14011 Millenium Millennium Challenge Corporation NOTICES Requests for Nominations: Millennium Challenge Corporation Advisory Council; Establishment, 38736-38737 2016-14075 National Credit National Credit Union Administration NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 38738 2016-13948 Agency Information Collection Activities; Proposals, Submissions, and Approvals: Supervisory Committee Audits and Verifications, 38737-38738 2016-13949 National Highway National Highway Traffic Safety Administration NOTICES Petitions for Decisions of Inconsequential Noncompliance: Volkswagen Group of America, Inc., 38772-38773 2016-14000 National Institute National Institutes of Health NOTICES Meetings: National Institute of Neurological Disorders and Stroke, 38723 2016-13931 National Oceanic National Oceanic and Atmospheric Administration NOTICES Marine Mammal Stock Assessment Reports, 38676-38689 2016-14015 Permits: Endangered Species; File No. 19281, 38675-38676 2016-13969 National Park National Park Service NOTICES Inventory Completions: Office of the State Archaeologist, University of Iowa, Iowa City, IA, 38734-38735 2016-14014 National Telecommunications National Telecommunications and Information Administration NOTICES Requests for Nominations: Commerce Spectrum Management Advisory Committee, 38689 2016-13971 Nuclear Regulatory Nuclear Regulatory Commission NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Nondiscrimination on the Basis of Sex in Education Programs or Activities Receiving Federal Financial Assistance, 38738-38739 2016-14040 Environmental Assessments; Availability, etc.: United States Department of the Interior, United States Geological Survey TRIGA Research Reactor, 38739-38745 2016-14078 Postal Regulatory Postal Regulatory Commission NOTICES New Postal Products, 38745 2016-13943 2016-13944 Presidential Documents Presidential Documents ADMINISTRATIVE ORDERS Belarus; Continuation of National Emergency (Notice of June 10, 2016), 38877-38879 2016-14224 Rural Utilities Rural Utilities Service NOTICES Application Deadlines: Guarantees for Bonds and Notes Issued for Electrification or Telephone Purposes Loan Program for Fiscal Year 2016, 38660-38663 2016-14009 Securities Securities and Exchange Commission NOTICES Applications: ETF Managers Group, LLC, et al., 38746-38747 2016-13967 Meetings; Sunshine Act, 38751 2016-14080 Self-Regulatory Organizations; Proposed Rule Changes: C2 Options Exchange, Inc., 38753-38754 2016-13961 Chicago Board Options Exchange, Inc., 38758-38759 2016-13962 Miami International Securities Exchange, LLC, 38751-38753 2016-13966 NASDAQ Stock Market, LLC, 38755-38758 2016-13963 New York Stock Exchange, LLC, 38747-38751 2016-13964 NYSE Arca, Inc., 38759-38769 2016-13965 Small Business Small Business Administration NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals, 38769-38771 2016-14012 2016-14013 2016-14018 Disaster Declarations: Mississippi, 38771 2016-14023 Texas, 38770 2016-14026 Virginia, 38770 2016-14021 Transportation Department Transportation Department See

Federal Aviation Administration

See

National Highway Traffic Safety Administration

RULES Acceptance Criteria for Portable Oxygen Concentrators Used On Board Aircraft; Correction, 38572-38573 2016-13955 NOTICES Meetings: Port Performance Freight Statistics Working Group, 38773-38774 2016-13991
Treasury Treasury Department See

Internal Revenue Service

Customs U.S. Customs and Border Protection NOTICES Agency Information Collection Activities; Proposals, Submissions, and Approvals: Application to Use the Automated Commercial Environment, 38727-38728 2016-14003 Declaration for Free Entry of Unaccompanied Articles, 38728-38729 2016-14001 Request for Information, 38729-38730 2016-14002 Separate Parts In This Issue Part II Interior Department, Indian Affairs Bureau, 38778-38876 2016-13686 Part III Presidential Documents, 38877-38879 2016-14224 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.

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81 114 Tuesday, June 14, 2016 Rules and Regulations BUREAU OF CONSUMER FINANCIAL PROTECTION 12 CFR Part 1083 [Docket No.: CFPB-2016-0028] RIN 3170-AA62 Civil Penalty Inflation Adjustments AGENCY:

Bureau of Consumer Financial Protection.

ACTION:

Interim final rule with request for public comment.

SUMMARY:

The Bureau of Consumer Financial Protection (Bureau) is publishing for public comment an interim final rule to adjust the civil monetary penalties within the Bureau's jurisdiction for inflation, as required by the Federal Civil Penalties Inflation Adjustment Act of 1990 (the Inflation Adjustment Act or the Act), as amended by the Debt Collection Improvement Act of 1996 and further amended by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (2015 Act).

DATES:

This rule is effective on July 14, 2016. Comments must be received on or before July 14, 2016.

ADDRESSES:

You may submit comments, identified by Docket No. CFPB-2016-0028 or RIN 3170-AA62, by any of the following methods:

Email: FederalRegisterComments @cfpb.gov. Include Docket No. CFPB-2016-0028 or RIN 3170-AA62 in the subject line of the email.

Electronic: http://www.regulations.gov. Follow the instructions for submitting comments.

Mail: Monica Jackson, Office of the Executive Secretary, Consumer Financial Protection Bureau, 1700 G Street NW., Washington, DC 20552.

Hand Delivery/Courier: Monica Jackson, Office of the Executive Secretary, Consumer Financial Protection Bureau, 1275 First Street NE., Washington, DC 20002.

Instructions: All submissions should include the agency name and docket number or Regulatory Information Number (RIN) for this rulemaking. Because paper mail in the Washington, DC area and at the Bureau is subject to delay, commenters are encouraged to submit comments electronically. In general, all comments received will be posted without change to http://www.regulations.gov. In addition, comments will be available for public inspection and copying at 1275 First Street NE., Washington, DC 20002, on official business days between the hours of 10 a.m. and 5 p.m. eastern time. You can make an appointment to inspect the documents by telephoning (202) 435-7275.

All comments, including attachments and other supporting materials, will become part of the public record and subject to public disclosure. Sensitive personal information, such as account numbers or Social Security numbers, should not be included. Comments generally will not be edited to remove any identifying or contact information.

FOR FURTHER INFORMATION CONTACT:

Kristin Bateman, Counsel, Legal Division, Consumer Financial Protection Bureau, at (202) 435-7700.

SUPPLEMENTARY INFORMATION:

I. Background

The Inflation Adjustment Act, as amended by the 2015 Act, requires Federal agencies to adjust the civil penalty amounts within their jurisdiction for inflation by July 1, 2016, and then by January 15 every year thereafter.1 Agencies must make the initial 2016 adjustments through an interim final rulemaking published in the Federal Register.2 Under the amended Act, any increase in a civil penalty made under the Act will apply to penalties assessed after the increase takes effect, including penalties whose associated violation predated the increase.3 The inflation adjustments mandated by the Act serve to maintain the deterrent effect of civil penalties and to promote compliance with the law.

1See 28 U.S.C. 2461 note.

2 The statute also provides that, for the initial 2016 adjustment, an agency may adjust a civil penalty by less than the otherwise required amount if (1) it determines, after publishing a notice of proposed rulemaking and providing an opportunity for comment, that increasing the civil penalty by the otherwise required amount would have a negative economic impact or that the social costs of increasing the civil penalty by the otherwise required amount outweigh the benefits, and (2) the Director of the Office of Management and Budget concurs with that determination. Inflation Adjustment Act section 4(c), codified at 28 U.S.C. 2461 note. The Bureau has chosen not to make use of this exception.

3 Inflation Adjustment Act section 6, codified at 28 U.S.C. 2461 note.

II. Method of Calculation

The Inflation Adjustment Act prescribes a specific method for calculating the inflation adjustments.4 As amended by the 2015 Act, the Act provides that the maximum (and minimum, if applicable) amounts for each civil penalty must be increased by the “cost-of-living adjustment,” a term that the Act defines. For purposes of the initial adjustments that agencies must make by July 1, 2016, the “cost-of-living adjustment” is defined as the percentage increase in the Consumer Price Index between (1) October of the calendar year during which the civil penalty amount was established or adjusted under a provision of law other than the Inflation Adjustment Act and (2) October 2015. The Consumer Price Index to be used for purposes of this calculation is the Consumer Price Index for all urban consumers (CPI-U) published by the Department of Labor.5 The Office of Management and Budget (OMB) has published guidance for implementing this requirement.6 OMB's guidance memorandum provides multipliers that agencies should use to adjust penalty amounts based on the year the penalty was established or last adjusted under authority other than the Inflation Adjustment Act.

4 Inflation Adjustment Act section 5, codified at 28 U.S.C. 2461 note.

5 U.S. Dep't of Labor, Bureau of Labor Statistics, CPI Tables, http://www.bls.gov/cpi/#tables.

6 Memorandum from Shaun Donovan, Director, Office of Management and Budget, to the Heads of Executive Departments and Agencies (Feb. 24, 2016), https://www.whitehouse.gov/sites/default/files/omb/memoranda/2016/m-16-06.pdf.

To determine the new penalty amount, the agency must apply the multiplier reflecting the “cost-of-living adjustment” 7 to the penalty amount as it was most recently established or adjusted under a provision of law other than the Inflation Adjustment Act. The agency must then round that amount to the nearest dollar.8 The increase made by this initial adjustment may not exceed 150 percent of the penalty amount in effect on the date the 2015 Act was enacted, November 2, 2015.

7 The multipliers reflecting the “cost-of-living adjustment” that OMB provides are rounded to five decimal places. The Bureau has used the OMB multipliers in calculating its civil penalty adjustments.

8 In rounding to the nearest dollar, the Bureau has rounded down where the digit immediately following the decimal point is less than 5 and has rounded up where the digit immediately following the decimal point is 5 or greater.

III. Description of the Interim Final Rule

This interim final rule establishes the inflation-adjusted maximum amounts for each civil penalty within the Bureau's jurisdiction. The following table lists the civil penalties within the Bureau's jurisdiction and summarizes the relevant information needed to calculate the inflation adjustments pursuant to the statutory method.

Law Penalty description Penalty amount as established or last adjusted under a provision other than the
  • inflation
  • adjustment act
  • Year penalty
  • established or
  • last adjusted
  • under a provision
  • other than the
  • inflation
  • adjustment act
  • Penalty amount in effect on
  • November 2,
  • 2015
  • Consumer Financial Protection Act, 12 U.S.C. 5565(c)(2)(A) Tier 1 penalty $5,000 92010  10$5,000  Consumer Financial Protection Act, 12 U.S.C. 5565(c)(2)(B) Tier 2 penalty 25,000 112010  1225,000  Consumer Financial Protection Act, 12 U.S.C. 5565(c)(2)(C) Tier 3 penalty 1,000,000 132010  141,000,000  Interstate Land Sales Full Disclosure Act, 15 U.S.C. 1717a(a)(2) Per violation 1,000 151989  161,000  Interstate Land Sales Full Disclosure Act, 15 U.S.C. 1717a(a)(2) Annual cap 1,000,000 171989  181,000,000  Real Estate Settlement Procedures Act, 12 U.S.C. 2609(d)(1) Per failure 50 191990  2050  Real Estate Settlement Procedures Act, 12 U.S.C. 2609(d)(1) Annual cap 100,000 211990  22100,000  Real Estate Settlement Procedures Act, 12 U.S.C. 2609(d)(2)(A) Per failure, where intentional 100 231990  24100  SAFE Act, 12 U.S.C. 5113(d)(2) Per violation 25,000 252008  2625,000  Truth in Lending Act, 15 U.S.C. 1639e(k)(1) First violation 10,000 272010  2810,000  Truth in Lending Act, 15 U.S.C. 1639e(k)(2) Subsequent violations 20,000 292010  3020,000 

    9 Dodd-Frank Wall Street Reform and Consumer Protection Act, Public Law 111-203, section 1055(c)(2)(A), 124 Stat. 1376, 2030 (2010).

    10 12 U.S.C. 5565(c)(2)(A) (2015).

    11 Dodd-Frank Wall Street Reform and Consumer Protection Act, Public Law 111-203, section 1055(c)(2)(B), 124 Stat. 1376, 2030 (2010).

    12 12 U.S.C. 5565(c)(2)(B) (2015).

    13 Dodd-Frank Wall Street Reform and Consumer Protection Act, Public Law 111-203, section 1055(c)(2)(C), 124 Stat. 1376, 2030 (2010).

    14 12 U.S.C. 5565(c)(2)(C) (2015).

    15 Department of Housing and Urban Development Reform Act, Public Law 101-235, section 111, 103 Stat. 1987, 2014 (1989).

    16 15 U.S.C. 1717a(a)(2) (2015).

    17 Department of Housing and Urban Development Reform Act, Public Law 101-235, section 111, 103 Stat. 1987, 2014 (1989).

    18 15 U.S.C. 1717a(a)(2) (2015).

    19 Cranston-Gonzalez National Affordable Housing Act, Public Law 101-625, section 942(a)(2), 104 Stat. 4079, 4412 (1990).

    20 12 U.S.C. 2609(d)(1) (2015).

    21 Cranston-Gonzalez National Affordable Housing Act, Public Law 101-625, section 942(a)(2), 104 Stat. 4079, 4412 (1990).

    22 12 U.S.C. 2609(d)(1) (2015).

    23 Cranston-Gonzalez National Affordable Housing Act, Public Law 101-625, section 942(a)(2), 104 Stat. 4079, 4412 (1990).

    24 12 U.S.C. 2609(d)(2)(A) (2015).

    25 Housing and Economic Recovery Act of 2008, Public Law 110-289, section 1514(d)(2), 122 Stat. 2654, 2823 (2008).

    26 12 U.S.C. 5113(d)(2) (2015).

    27 Dodd-Frank Wall Street Reform and Consumer Protection Act, Public Law 111-203, section 1472(a), 124 Stat. 1376, 2189 (2010).

    28 15 U.S.C. 1639e(k)(1) (2015).

    29 Dodd-Frank Wall Street Reform and Consumer Protection Act, Public Law 111-203, section 1472(a), 124 Stat. 1376, 2190 (2010).

    30 15 U.S.C. 1639e(k)(2) (2015).

    The Bureau followed the procedure outlined above in part II to calculate the adjusted civil penalty amounts. In accordance with the statutory requirements and OMB guidance, the Bureau multiplied each penalty amount as established or last adjusted under a provision other than the Inflation Adjustment Act by the OMB multiplier corresponding to the appropriate year, and then rounded that amount to the nearest dollar, to calculate the new, inflation-adjusted civil penalty amount. The Bureau then confirmed that the amount by which each civil penalty increased did not exceed 150 percent of the corresponding civil penalty level in effect on November 2, 2015. None of the increases exceeded this 150-percent threshold. The following chart summarizes the results of these calculations:

    Law Penalty description Penalty amount as established or last adjusted under a provision other than the
  • inflation
  • adjustment act
  • Year penalty
  • established or
  • last adjusted
  • under a provision
  • other than the
  • inflation
  • adjustment act
  • OMB
  • “cost-of-living
  • adjustment”
  • multiplier
  • New penalty amount
    Consumer Financial Protection Act, 12 U.S.C. 5565(c)(2)(A) Tier 1 penalty $5,000 2010 1.08745 $5,437 Consumer Financial Protection Act, 12 U.S.C. 5565(c)(2)(B) Tier 2 penalty 25,000 2010 1.08745 27,186 Consumer Financial Protection Act, 12 U.S.C. 5565(c)(2)(C) Tier 3 penalty 1,000,000 2010 1.08745 1,087,450 Interstate Land Sales Full Disclosure Act, 15 U.S.C. 1717a(a)(2) Per violation 1,000 1989 1.89361 1,894 Interstate Land Sales Full Disclosure Act, 15 U.S.C. 1717a(a)(2) Annual cap 1,000,000 1989 1.89361 1,893,610 Real Estate Settlement Procedures Act, 12 U.S.C. 2609(d)(1) Per failure 50 1990 1.78156 89 Real Estate Settlement Procedures Act, 12 U.S.C. 2609(d)(1) Annual cap 100,000 1990 1.78156 178,156 Real Estate Settlement Procedures Act, 12 U.S.C. 2609(d)(2)(A) Per failure, where intentional 100 1990 1.78156 178 SAFE Act, 12 U.S.C. 5113(d)(2) Per violation 25,000 2008 1.09819 27,455 Truth in Lending Act, 15 U.S.C. 1639e(k)(1) First violation 10,000 2010 1.08745 10,875 Truth in Lending Act, 15 U.S.C. 1639e(k)(2) Subsequent violations 20,000 2010 1.08745 21,749

    This rule codifies these civil penalty amounts by adding new part 1083 to title 12 of the CFR and new § 1083.1 therein.

    IV. Legal Authority and Effective Date

    The Bureau issues this rule under the Federal Civil Penalties Inflation Adjustment Act of 1990,31 as amended by the Debt Collection Improvement Act of 1996,32 and further amended by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015,33 which requires the Bureau to adjust the civil penalties within its jurisdiction for inflation according to a statutorily prescribed formula.

    31 Public Law 101-410, 104 Stat. 890 (1990).

    32 Public Law 104-134, section 31001(s)(1), 110 Stat. 1321, 1321-373 (1996).

    33 Public Law 114-74, section 701, 129 Stat. 584, 599 (2015).

    The Administrative Procedure Act (APA) generally requires an agency to publish a rule at least 30 days before its effective date.34 This rule satisfies that requirement.

    34See 5 U.S.C. 553(d).

    V. Request for Comment

    Although notice and comment rulemaking procedures are not required, the Bureau invites comments on this notice. Commenters are specifically encouraged to identify any technical issues raised by the rule.

    VI. Regulatory Requirements Notice and Comment

    Under the APA, notice and opportunity for public comment are not required if the Bureau finds that notice and public comment are impracticable, unnecessary, or contrary to the public interest.35 This interim final rule adjusts the civil penalty amounts within the Bureau's jurisdiction for inflation, as required by the Federal Civil Penalties Inflation Adjustment Act of 1990, as amended by the Debt Collection Improvement Act of 1996 and further amended by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015. The amendments in this interim final rule are technical, and they merely apply the statutory method for adjusting civil penalty amounts. For these reasons, the Bureau has determined that publishing a notice of proposed rulemaking and providing opportunity for public comment are unnecessary. Moreover, the statute expressly requires the Bureau to make these initial adjustments through an interim final rulemaking to be published by July 1, 2016,36 and OMB's guidance confirms that agencies need not complete a notice-and-comment process before promulgating the rule.37 Therefore, the amendments are adopted in final form.

    35 5 U.S.C. 553(b)(B).

    36 Inflation Adjustment Act, section 4(b)(1)(A), codified at 28 U.S.C. 2461 note.

    37 Memorandum from Shaun Donovan, Director, Office of Management and Budget, to the Heads of Executive Departments and Agencies 3 (Feb. 24, 2016), https://www.whitehouse.gov/sites/default/files/omb/memoranda/2016/m-16-06.pdf.

    Regulatory Flexibility Act

    Because no notice of proposed rulemaking is required, the Regulatory Flexibility Act does not require an initial or final regulatory flexibility analysis.38

    38 5 U.S.C. 603(a), 604(a).

    Paperwork Reduction Act

    In accordance with the Paperwork Reduction Act of 1995,39 the Bureau reviewed this interim final rule. No collections of information pursuant to the Paperwork Reduction Act are contained in the interim final rule.

    39 44 U.S.C. 3506; 5 CFR 1320.

    List of Subjects in 12 CFR Part 1083

    Administrative practice and procedure, Consumer protection, Penalties.

    Authority and Issuance

    For the reasons set forth in the preamble, the Bureau adds part 1083 to chapter X in title 12 of the Code of Federal Regulations to read as set forth below:

    PART 1083—CIVIL PENALTY ADJUSTMENTS Sec. 1083.1 Adjustments of civil penalty amounts. Authority:

    12 U.S.C. 2609(d); 12 U.S.C. 5113(d)(2); 12 U.S.C. 5565(c); 15 U.S.C. 1639e(k); 15 U.S.C. 1717a(a); 28 U.S.C. 2461 note.

    § 1083.1 Adjustments of civil penalty amounts.

    (a) The maximum amount of each civil penalty within the jurisdiction of the Consumer Financial Protection Bureau to impose is adjusted in accordance with the Federal Civil Penalties Inflation Adjustment Act of 1990, as amended by the Debt Collection Improvement Act of 1996 and further amended by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015, (28 U.S.C. 2461 note) as follows:

    U.S. code citation Civil penalty description Adjusted
  • maximum civil
  • penalty amount
  • 12 U.S.C. 5565(c)(2)(A) Tier 1 penalty $5,437 12 U.S.C. 5565(c)(2)(B) Tier 2 penalty 27,186 12 U.S.C. 5565(c)(2)(C) Tier 3 penalty 1,087,450 15 U.S.C. 1717a(a)(2) Per violation 1,894 15 U.S.C. 1717a(a)(2) Annual cap 1,893,610 12 U.S.C. 2609(d)(1) Per failure 89 12 U.S.C. 2609(d)(1) Annual cap 178,156 12 U.S.C. 2609(d)(2)(A) Per failure, where intentional 178 12 U.S.C. 5113(d)(2) Per violation 27,455 15 U.S.C. 1639e(k)(1) First violation 10,875 15 U.S.C. 1639e(k)(2) Subsequent violations 21,749

    (b) The adjustments in paragraph (a) of this section shall apply to civil penalties assessed after July 14, 2016, regardless of when the violation for which the penalty is assessed occurred.

    Dated: June 7, 2016. Richard Cordray, Director, Bureau of Consumer Financial Protection.
    [FR Doc. 2016-14031 Filed 6-13-16; 8:45 am] BILLING CODE 4810-AM-P
    DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Parts 1, 11, 121, 125, and 135 Office of the Secretary 14 CFR Part 382 [Docket No.: FAA-2014-0554; Amdt. Nos. 1-69; 11-60; 121-374, 125-65, 135-133] RIN 2120-AK32 Acceptance Criteria for Portable Oxygen Concentrators Used On Board Aircraft; Correction AGENCY:

    Federal Aviation Administration (FAA) and the Office of the Secretary (OST), Department of Transportation (DOT).

    ACTION:

    Final rule; correction.

    SUMMARY:

    This final rule replaces the existing process by which the Federal Aviation Administration (Agency or FAA) approves portable oxygen concentrators (POC) for use on board aircraft in air carrier operations, commercial operations, and certain other operations using large aircraft. The FAA currently assesses each POC make and model on a case-by-case basis and if the FAA determines that a particular POC is safe for use on board an aircraft, the FAA conducts rulemaking to identify the specific POC model in an FAA regulation. This final rule replaces the current process and allows passengers to use a POC on board an aircraft if the POC satisfies certain acceptance criteria and bears a label indicating conformance with the acceptance criteria. The labeling requirement only affects POCs intended for use on board aircraft that were not previously approved for use on aircraft by the FAA. Additionally, this rulemaking will eliminate redundant operational requirements and paperwork requirements related to the physician's statement. As a result, this rulemaking will reduce burdens for POC manufacturers, passengers who use POCs while traveling, and affected aircraft operators. This final rule also makes conforming amendments to the Department of Transportation's (Department or DOT) rule implementing the Air Carrier Access Act (ACAA) to require carriers to accept all POC models that meet FAA acceptance criteria as detailed in this rule.

    DATES:

    This correction will become effective on June 23, 2016.

    FOR FURTHER INFORMATION CONTACT:

    For technical questions concerning this action, contact DK Deaderick, 121 Air Carrier Operations Branch, Air Transportation Division, Flight Standards Service, Federal Aviation Administration, AFS-220, 800 Independence Avenue SW., Washington, DC 20591; telephone (202) 267-7480; email [email protected] For questions regarding the Department's disability regulation (14 CFR part 382), contact Clereece Kroha, Senior Attorney, Office of Aviation Enforcement and Proceedings, Department of Transportation, 1200 New Jersey Avenue SE., Washington, DC 20590; telephone (202) 366-9041; email [email protected]

    SUPPLEMENTARY INFORMATION:

    Background

    On May 24, 2016, the FAA published a final rule entitled, “Acceptance Criteria for Portable Oxygen Concentrators Used On Board Aircraft” (81 FR 33098).

    This final rule affects the use of POCs on board aircraft in operations conducted under title 14 of the Code of Federal Regulations (14 CFR) parts 121, 125, and 135, by replacing the existing FAA case-by-case approval process for each make and model of POC in Special Federal Aviation Regulation (SFAR) No. 106, with FAA acceptance criteria. Under SFAR No. 106, each time the FAA approves a specific model of POC for use on board aircraft, the agency updates the list of approved POCs in the SFAR.

    This final rule removes SFAR No. 106 and replaces it with POC acceptance criteria and specific labeling requirements to identify POCs that conform to the acceptance criteria. POCs that conform to the final rule acceptance criteria will be allowed on board aircraft without additional FAA review and rulemaking.

    As with existing requirements for FAA approval of POCs that may be used on aircraft, the final rule acceptance criteria and labeling requirement only apply to POCs intended for use on board aircraft. Table 1 provides a comparison of the final rule acceptance criteria and labeling requirement with related SFAR No. 106.

    However, the final rule was published with an incorrect amendment number, “11-59,” which is the same amendment number as the rule entitled “Administrative Practices and Procedures, Reporting and Recordkeeping Requirements ” (81 FR 13969), published on March 16, 2016. The correct amendment number for this rule should be “11-60.”

    Correction

    In FR Doc. 2016-11908 beginning on page 33098 in the Federal Register of May 24, 2016, make the following correction:

    Correction

    1. On page 33098, in the first column, in the document heading, revise “[Docket No.: FAA-2014-0554; Amdt. Nos. 1-69, 11-59, 121-374, 125-65, and 135-133]” to read “[Docket No.: FAA-2014-0554; Amdt. Nos. 1-69, 11-60, 121-374, 125-65, and 135-133]”.

    Issued under authority provided by 49 U.S.C. 106(f) in Washington, DC, on June 1, 2016. Dale A. Bouffiou, Acting Director, Office of Rulemaking.
    [FR Doc. 2016-13955 Filed 6-13-16; 8:45 am] BILLING CODE 4910-13-P
    DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2016-6899; Directorate Identifier 2016-NM-066-AD; Amendment 39-18558; AD 2016-12-09] RIN 2120-AA64 Airworthiness Directives; Airbus Airplanes AGENCY:

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

    ACTION:

    Final rule; request for comments.

    SUMMARY:

    We are superseding Airworthiness Directive (AD) 2016-09-11 for certain Airbus Model A330-200, -200 Freighter, and -300 series airplanes; and Model A340-200 and -300 series airplanes. AD 2016-09-11 required removing fasteners, doing a rototest inspection of fastener holes, installing new fasteners, oversizing the holes and doing rototest inspections for cracks if necessary, and repairing any cracking that is found. This new AD requires the same actions as AD 2016-09-11, but includes Model A330-300 series airplanes in paragraph (g)(2) of this AD. This AD was prompted by the discovery of missing affected airplanes in paragraph (g)(2) of AD 2016-09-11 that resulted from converting a table in the proposed AD to text in AD 2016-09-11. We are issuing this AD to detect and correct cracking on certain holes of certain frames of the center wing box (CWB), which could affect the structural integrity of the airplane.

    DATES:

    This AD is effective June 29, 2016.

    The Director of the Federal Register approved the incorporation by reference of certain publications listed in this AD as of June 13, 2016 (81 FR 27986, May 9, 2016).

    We must receive comments on this AD by July 29, 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: U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays.

    For service information identified in this final rule, contact Airbus SAS, Airworthiness Office—EAL, 1 Rond Point Maurice Bellonte, 31707 Blagnac Cedex, France; telephone: +33 5 61 93 36 96; fax: +33 5 61 93 45 80; email: [email protected]; Internet: http://www.airbus.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-2016-6899.

    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-2016-6899; or in person at the Docket Management Facility between 9 a.m. and 5 p.m., proposed AD, the regulatory evaluation, any comments received, and other information. The street address for the Docket Operations office (telephone: 800-647-5527) is in the ADDRESSES section. Comments will be available in the AD docket shortly after receipt.

    FOR FURTHER INFORMATION CONTACT:

    Vladimir Ulyanov, Aerospace Engineer, International Branch, ANM-116, Transport Airplane Directorate, FAA, 1601 Lind Avenue SW., Renton, WA 98057-3356; telephone: 425-227-1138; fax: 425-227-1149.

    SUPPLEMENTARY INFORMATION:

    Discussion

    On April 21, 2016, we issued AD 2016-09-11, Amendment 39-18509 (81 FR 27986, May 9, 2016) (“AD 2016-09-11”), for certain Airbus Model A330-200, -200 Freighter, and -300 series airplanes; and Model A340-200 and -300 series airplanes. AD 2016-09-11 was prompted by reports that cracks were found on an adjacent hole of certain frames of the CWB. AD 2016-09-11 required removing fasteners, doing a rototest inspection of fastener holes, installing new fasteners, oversizing the holes and doing rototest inspections for cracks if necessary, and repairing any cracking that was found. We issued AD 2016-09-11 to detect and correct cracking on certain holes of certain frames of the CWB that could affect the structural integrity of the airplane.

    Since we issued AD 2016-09-11, we discovered missing affected airplanes in paragraph (g)(2) of AD 2016-09-11 that resulted from converting a table to text in that AD. We stated in the preamble of AD 2016-09-11 that we revised the format of paragraph (g) of that AD, at the request of the Office of the Federal Register, by converting the table to text. We also stated this change to the format does not affect the requirements of that paragraph.

    However, in converting the table to text, we inadvertently omitted Model A330-300 series airplanes from paragraph (g)(2) of AD 2016-09-11. We have changed paragraph (g)(2) of this AD to include Model A330-300 series airplanes.

    The European Aviation Safety Agency (EASA), which is the Technical Agent for the Member States of the European Union, has issued EASA Airworthiness Directive 2014-0149, dated June 13, 2014 (referred to after this as the Mandatory Continuing Airworthiness Information, or “the MCAI”), to correct an unsafe condition for certain Airbus Model A330-200, -200 Freighter, and -300 series airplanes; and Model A340-200 and -300 series airplanes. The MCAI states:

    During accomplishment of A330 Airworthiness Limitation Item (ALI) task 57-11-04 on the rear fitting of the Frame (FR) 40 between stringers 38 and 39 on both [left-hand] LH/[right-hand] RH sides, cracks were found on an adjacent hole. After reaming at second oversize of the subject hole, the crack was still present.

    Other crack findings on this adjacent hole have been reported on A330 and A340-200/-300 aeroplanes as a result of sampling inspections.

    This condition, if not detected and corrected, could affect the structural integrity of the aeroplane.

    For the reasons described above, this [EASA] AD requires removal of the fasteners and repetitive rototest inspections of fastener holes at FR40 vertical web located above Center Wing Box (CWB) lower panel reference and/or below CWB lower panel reference on both sides and, depending on findings, accomplishment of the applicable corrective actions.

    Note: These holes affected by this [EASA] AD are different from the ones affected by EASA AD 2009-0001 [http://ad.easa.europa.eu/blob/easa_ad_2009_0001.pdf/AD_2009-0001_1].

    Required actions also include oversizing certain holes, installing new fasteners, and repairing any cracking that is found. The initial compliance times range from 13,500 to 30,900 flight cycles, or 57,000 to 162,000 flight hours, depending on airplane operation and utilization. The repetitive compliance times are 7,400 flight cycles/24,300 flight hours or 5,950 flight cycles/40,400 flight hours from ALI embodiment. You may examine the MCAI on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2016-6899.

    Related Service Information Under 1 CFR Part 51

    Airbus has issued the following service information. The service information describes procedures for removing the fasteners and doing a repetitive rototest inspection of fastener holes at FR40 vertical web on both sides, installing new fasteners in transition fit, and oversizing the holes.

    • Airbus Service Bulletin A330-57-3114, dated March 12, 2013.

    • Airbus Service Bulletin A330-57-3115, dated April 4, 2013.

    • Airbus Service Bulletin A330-57-3116, dated March 12, 2013.

    • Airbus Service Bulletin A340-57-4123, dated March 12, 2013.

    • Airbus Service Bulletin A340-57-4124, Revision 01, dated August 22, 2013.

    • Airbus Service Bulletin A340-57-4125, dated March 12, 2013.

    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 and Requirements of This AD

    This product has been approved by the aviation authority of another country, and is approved for operation in the United States. Pursuant to our bilateral agreement with the State of Design Authority, we have been notified of the unsafe condition described in the MCAI and service information referenced above. We are issuing this AD because we evaluated all pertinent information and determined the unsafe condition exists and is likely to exist or develop on other products of these same type designs.

    FAA's Justification and Determination of the Effective Date

    We are superseding AD 2016-09-11 to correct an error in the regulatory text that we made when we converted a table to text in paragraph (g)(2) of AD 2016-09-11. No other changes have been made to AD 2016-09-11. Therefore, we determined that notice and opportunity for prior public comment are unnecessary.

    Comments Invited

    This AD is a final rule that involves requirements affecting flight safety, and we did not precede it by notice and opportunity for public comment. We invite you to send any written relevant data, views, or arguments about this AD. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2016-6899; Directorate Identifier 2016-NM-066-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this AD. We will consider all comments received by the closing date and may amend this AD because of those comments.

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

    Costs of Compliance

    We estimate that this AD affects 35 airplanes of U.S. registry.

    We estimate the following costs to comply with this AD:

    Estimated Costs Action Labor cost Parts cost Cost per product Cost on
  • U.S. operators
  • Inspection 78 work-hours × $85 per hour = $6,630 per inspection cycle $0 $6,630 per inspection cycle $232,050 per inspection cycle.

    We estimate the following costs to do any necessary repairs that will be required based on the results of the inspection. We have no way of determining the number of airplanes that might need this repair:

    On-Condition Costs Action Labor cost Parts cost Cost per
  • product
  • Oversize, installation, and inspection 98 work-hours × $85 per hour = $8,330 $136,400 $144,730

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

    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 that this AD:

    1. Is not a “significant regulatory action” under Executive Order 12866;

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

    3. Will not affect intrastate aviation in Alaska; and

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

    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 airworthiness directive (AD) 2016-09-11, Amendment 39-18509 (81 FR 27986, May 9, 2016), and adding the following new AD: 2016-12-09 Airbus: Amendment 39-18558. Docket No. FAA-2016-6899; Directorate Identifier 2016-NM-066-AD. (a) Effective Date

    This AD is effective June 29, 2016.

    (b) Affected ADs

    This AD replaces AD 2016-09-11, Amendment 39-18509 (81 FR 27986, May 9, 2016) (“AD 2016-09-11”).

    (c) Applicability

    This AD applies to the airplanes identified in paragraphs (c)(1) and (c)(2) of this AD, certificated in any category, all manufacturer serial numbers, except those on which Airbus Modification (Mod) 55792 or Mod 55306 has been embodied in production, and except those on which Airbus Repair Instruction R57115092 has been embodied in service on both right-hand (RH) and left-hand (LH) sides.

    (1) Airbus Model A330-201, -202, -203, -223, -223F, -243 -243F, -301, -302, -303, -321, -322, -323, -341, -342, and -343 airplanes.

    (2) Airbus Model A340-211, -212, -213, -311, -312, and -313 airplanes.

    (d) Subject

    Air Transport Association (ATA) of America Code 57, Wings.

    (e) Reason

    This AD was prompted by reports that cracks were found on an adjacent hole of certain frames of the center wing box (CWB). We are issuing this AD to detect and correct cracking on certain holes of the CWB, which could affect the structural integrity of the airplane.

    (f) Compliance

    Comply with this AD within the compliance times specified, unless already done.

    (g) Inspection

    Do a rototest inspection of the fastener holes at the frame (FR) 40 vertical web, on both sides, as specified in paragraphs (g)(1) through (g)(6) of this AD, except as required by paragraph (k) of this AD.

    (1) For Model A330-300 series airplanes in pre-mod 44360 configuration: At the later of the times specified in paragraphs (g)(1)(i) and (g)(1)(ii) of this AD, inspect below the CWB lower panel reference, in accordance with the Accomplishment Instructions of Airbus Service Bulletin A330-57-3114, dated March 12, 2013.

    (i) At the applicable time specified in paragraph 1.E., “Compliance” of Airbus Service Bulletin A330-57-3114, dated March 12, 2013.

    (ii) Within 2,400 flight cycles or 24 months after the effective date of this AD, whichever occurs first.

    (2) For Model A330-200 and -300 series airplanes in post-mod 44360 and pre-mod 49202 configuration: At the later of the times specified in paragraphs (g)(2)(i) and (g)(2)(ii) of this AD, inspect below the CWB lower panel reference, in accordance with the Accomplishment Instructions of Airbus Service Bulletin A330-57-3116, dated March 12, 2013.

    (i) At the applicable time specified in paragraph 1.E., “Compliance,” of Airbus Service Bulletin A330-57-3116, dated March 12, 2013.

    (ii) Within 2,400 flight cycles or 24 months after the effective date of this AD, whichever occurs first.

    (3) For Model A330-200 and -300 series airplanes in pre-mod 55306 and pre-mod 55792 configuration: At the later of the times specified in paragraphs (g)(3)(i) and (g)(3)(ii) of this AD, inspect above the CWB lower panel reference, in accordance with the Accomplishment Instructions of Airbus Service Bulletin A330-57-3115, dated April 4, 2013.

    (i) At the applicable time specified in paragraph 1.E., “Compliance” of Airbus Service Bulletin A330-57-3115, dated April 4, 2013.

    (ii) Within 2,400 flight cycles or 24 months after the effective date of this AD, whichever occurs first.

    (4) For Model A340-200 and -300 series airplanes in pre-mod 44360 configuration: At the later of the times specified in paragraphs (g)(4)(i) and (g)(4)(ii) of this AD, inspect below the CWB lower panel reference, in accordance with the Accomplishment Instructions of Airbus Service Bulletin A340-57-4123, dated March 12, 2013.

    (i) At the applicable time specified in paragraph 1.E., “Compliance” of Airbus Service Bulletin A330-57-4123, dated March 12, 2013.

    (ii) Within 1,300 flight cycles or 24 months after the effective date of this AD, whichever occurs first.

    (5) For Model A340-200 and -300 series airplanes in pre-mod 55306 and pre-mod 55792 configuration: At the later of the times specified in paragraphs (g)(5)(i) and (g)(5)(ii) of this AD, inspect above the CWB lower panel reference, in accordance with the Accomplishment Instructions of Airbus Service Bulletin A340-57-4124, Revision 01, dated August 22, 2013.

    (i) At the applicable time specified in paragraph 1.E., “Compliance,” of Airbus Service Bulletin A340-57-4124, Revision 01, dated August 22, 2013.

    (ii) Within 1,300 flight cycles or 24 months after the effective date of this AD, whichever occurs first.

    (6) For Model A340-200 and -300 series airplanes in post-mod 44360 and pre-mod 49202 configuration: At the later of the times specified in paragraphs (g)(6)(i) and (g)(6)(ii) of this AD, inspect below the CWB lower panel reference, in accordance with the Accomplishment Instructions of Airbus Service Bulletin A340-57-4125, dated March 12, 2013.

    (i) At the applicable time specified in paragraph 1.E., “Compliance,” of Airbus Service Bulletin A340-57-4125, dated March 12, 2013.

    (ii) Within 1,300 flight cycles or 24 months after the effective date of this AD, whichever occurs first.

    (h) Follow-On Actions: No Cracking

    If no crack is found during any inspection required by paragraph (g) of this AD, do the actions specified in paragraphs (h)(1) and (h)(2) of this AD.

    (1) Before further flight, install new fasteners in the transition fit, in accordance with the Accomplishment Instructions of the applicable service information identified in paragraph (g) of this AD.

    (2) Repeat the inspection required by paragraph (g) of this AD thereafter at the applicable time identified in paragraph 1.E., “Compliance,” of the applicable service information identified in paragraph (g) of this AD.

    (i) Follow-On Actions: Crack Findings

    If any crack is found during any inspection required by paragraph (g) of this AD: Before further flight, oversize the holes to the first oversize in comparison with the current hole diameter, and do a rototest inspection for cracks, in accordance with the Accomplishment Instructions of the applicable service information identified in paragraph (g) of this AD.

    (1) If no cracking is found during the rototest inspection required by paragraph (i) of this AD, do the actions specified in paragraphs (i)(1)(i) and (i)(1)(ii) of this AD.

    (i) Before further flight: Install new fasteners in the transition fit, in accordance with the Accomplishment Instructions of the applicable service information identified in paragraph (g) of this AD.

    (ii) Repeat the inspection required by paragraph (g) of this AD thereafter at the applicable time identified in paragraph 1.E., “Compliance,” of the applicable service information identified in paragraph (g) of this AD.

    (2) If cracking is found during the rototest inspection required by paragraph (i) of this AD: Before further flight, repair using a method approved by the Manager, International Branch, ANM-116, Transport Airplane Directorate, FAA; or the European Aviation Safety Agency (EASA); or Airbus's EASA Design Organization Approval (DOA).

    (j) Terminating Action Specifications

    Accomplishment of the initial and repetitive inspections required by this AD terminates accomplishment of Airworthiness Limitation Items Tasks 57-11-04 and 57-11-02 of the Airworthiness Limitation Section (ALS) Part 2, Damage Tolerant Airworthiness Limitation Items (DT ALI).

    (1) Installation of new fasteners, as specified in paragraph (h)(1) of this AD, does not terminate the repetitive inspections required by paragraph (g) of this AD.

    (2) Accomplishment of the corrective actions specified in the introductory text of paragraph (i) and paragraph (i)(1) of this AD does not terminate the repetitive inspections required by paragraph (g) of this AD.

    (3) Accomplishment of the repair specified in paragraph (i)(2) of this AD does not terminate repetitive inspections required by paragraph (g) of this AD, unless the approved repair method specifies otherwise.

    (k) Exceptions to Service Information

    (1) If the applicable service information identified in paragraph (g) of this AD specifies contacting Airbus for appropriate action: Before further flight, repair using a method approved by the Manager, International Branch, ANM-116, Transport Airplane Directorate, FAA; or the EASA; or Airbus's EASA DOA.

    (2) Where paragraph 1.E., “Compliance,” of the applicable service information specified in paragraph (g) of this AD specifies a compliance time in terms of a “Threshold” and “Grace Period,” this AD requires compliance at the later of the applicable threshold and grace period.

    (3) Where paragraph 1.E., “Compliance,” of the applicable service information specified in paragraph (g) of this AD specifies a threshold as “before next flight,” this AD requires compliance before the next flight after the applicable finding.

    (l) Credit for Previous Actions

    This paragraph provides credit for actions required by paragraphs (g) and (i) of this AD, if those actions were performed before the effective date of this AD using the applicable service information specified in paragraph (l)(1), (l)(2), (l)(3), (l)(4), (l)(5), (l)(6), (l)(7), (l)(8), or (l)(9) of this AD. This service information is not incorporated by reference in this AD.

    (1) Airbus Technical Disposition LR57D11023270, Issue B, dated July 12, 2011.

    (2) Airbus Technical Disposition LR57D11029171, Issue B, dated September 6, 2011.

    (3) Airbus Technical Disposition LR57D11029173, Issue B, dated September 6, 2011.

    (4) Airbus Technical Disposition LR57D11030741, Issue B, dated September 22, 2011.

    (5) Airbus Technical Disposition LR57D11029170, Issue C, dated September 6, 2011.

    (6) Airbus Technical Disposition LR57D11023714, Issue B, dated July 12, 2011.

    (7) Airbus Technical Disposition LR57D11029172, Issue B, dated September 6, 2011.

    (8) Airbus Technical Disposition LR57D11030740, Issue C, dated September 22, 2011.

    (9) Airbus Service Bulletin A340-57-4124, dated April 4, 2013.

    (m) Other FAA AD Provisions

    The following provisions also apply to this AD:

    (1) Alternative Methods of Compliance (AMOCs): The Manager, International Branch, ANM-116, Transport Airplane Directorate, 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 International Branch, send it to ATTN: Vladimir Ulyanov, Aerospace Engineer, International Branch, ANM-116, Transport Airplane Directorate, FAA, 1601 Lind Avenue SW., Renton, WA 98057-3356; telephone: 425-227-1138; fax: 425-227-1149. Information may be emailed to: [email protected] 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. The AMOC approval letter must specifically reference this AD.

    (2) Contacting the Manufacturer: For any requirement in this AD to obtain corrective actions from a manufacturer, the action must be accomplished using a method approved by the Manager, International Branch, ANM-116, Transport Airplane Directorate, FAA; or the EASA; or Airbus's EASA DOA. If approved by the DOA, the approval must include the DOA-authorized signature.

    (n) Related Information

    (1) Refer to Mandatory Continuing Airworthiness Information (MCAI) EASA Airworthiness Directive 2014-0149, dated June 13, 2014, for related information. This MCAI may be found in the AD docket on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2016-6899.

    (2) Service information identified in this AD that is not incorporated by reference is available at the addresses specified in paragraphs (o)(4) and (o)(5) of this AD.

    (o) 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 this AD specifies otherwise.

    (3) The following service information was approved for IBR on June 13, 2016, (81 FR 27986, May 9, 2016).

    (i) Airbus Service Bulletin A330-57-3114, dated March 12, 2013.

    (ii) Airbus Service Bulletin A330-57-3115, dated April 4, 2013.

    (iii) Airbus Service Bulletin A330-57-3116, dated March 12, 2013.

    (iv) Airbus Service Bulletin A340-57-4123, dated March 12, 2013.

    (v) Airbus Service Bulletin A340-57-4124, Revision 01, dated August 22, 2013.

    (vi) Airbus Service Bulletin A340-57-4125, dated March 12, 2013.

    (4) For service information identified in this AD, contact Airbus SAS, Airworthiness Office—EAL, 1 Rond Point Maurice Bellonte, 31707 Blagnac Cedex, France; telephone: +33 5 61 93 36 96; fax: +33 5 61 93 45 80; email: [email protected]; Internet: http://www.airbus.com.

    (5) You may view this 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.

    (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 Renton, Washington, on June 3, 2016. Michael Kaszycki, Acting Manager, Transport Airplane Directorate, Aircraft Certification Service.
    [FR Doc. 2016-13856 Filed 6-13-16; 8:45 am] BILLING CODE 4910-13-P
    DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 39 [Docket No. FAA-2016-6900; Directorate Identifier 2016-NM-064-AD; Amendment 39-18559; AD 2016-12-10] RIN 2120-AA64 Airworthiness Directives; Airbus Airplanes AGENCY:

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

    ACTION:

    Final rule; request for comments.

    SUMMARY:

    We are superseding Airworthiness Directive (AD) 2016-09-07 for all Airbus Model A318, A319, A320, and A321 series airplanes. AD 2016-09-07 required replacing certain pitot probes on the captain, first officer, and standby sides. This new AD retains those requirements, but with a revised compliance time. Since we issued AD 2016-09-07, we received additional reports of airspeed indication discrepancies during flight at high altitudes in inclement weather. We are issuing this AD to prevent airspeed indication discrepancies caused by accumulation of ice crystals during inclement weather, which, depending on the prevailing altitude, could lead to reduced controllability of the airplane.

    DATES:

    This AD is effective June 29, 2016.

    The Director of the Federal Register approved the incorporation by reference of certain publications listed in this AD as of June 10, 2016 (81 FR 27298, May 6, 2016).

    We must receive comments on this AD by July 29, 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: U.S. Department of Transportation, Docket Operations, M-30, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE., Washington, DC, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays.

    For service information identified in this final rule, contact Airbus, Airworthiness Office—EIAS, 1 Rond Point Maurice Bellonte, 31707 Blagnac Cedex, France; telephone: +33 5 61 93 36 96; fax: +33 5 61 93 44 51; email: [email protected]; Internet: http://www.airbus.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-2016-6900.

    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-2016-6900; or in person at the Docket Management Facility between 9 a.m. and 5 p.m., proposed AD, the regulatory evaluation, any comments received, and other information. The street address for the Docket Operations office (telephone 800-647-5527) is in the ADDRESSES section. Comments will be available in the AD docket shortly after receipt.

    FOR FURTHER INFORMATION CONTACT:

    Sanjay Ralhan, Aerospace Engineer, International Branch, ANM-116, Transport Airplane Directorate, FAA, 1601 Lind Avenue SW., Renton, WA 98057-3356; telephone: 425-227-1405; fax: 425-227-1149.

    SUPPLEMENTARY INFORMATION:

    Discussion

    On April 20, 2016, we issued AD 2016-09-07, Amendment 39-18505 (81 FR 27298, May 6, 2016) (“AD 2016-09-07”), for all Airbus Model A318, A319, A320, and A321 series airplanes. AD 2016-09-07 was prompted by reports of airspeed indication discrepancies during flight at high altitudes in inclement weather. AD 2016-09-07 required replacing certain pitot probes on the captain, first officer, and standby sides with certain new pitot probes. We issued AD 2016-09-07 to prevent airspeed indication discrepancies caused by accumulation of ice crystals during inclement weather, which, depending on the prevailing altitude, could lead to reduced controllability of the airplane.

    Since we issued AD 2016-09-07, we have received additional reports of airspeed indication discrepancies during flight at high altitudes in inclement weather. Certain pitot probes are susceptible to adverse environmental conditions and have a high tendency to accumulate ice crystals resulting in airspeed indication discrepancies, which could result in reduced controllability of the airplane.

    As we explained in AD 2016-09-07, the European Aviation Safety Agency (EASA), which is the Technical Agent for the Member States of the European Union, issued EASA Airworthiness Directive 2015-0205, dated October 9, 2015 (referred to after this as the Mandatory Continuing Airworthiness Information, or “the MCAI”), to correct an unsafe condition for all Airbus Model A318, A319, A320, and A321 series airplanes. The MCAI states:

    Occurrences were reported on A320 family aeroplanes of airspeed indication discrepancies while flying at high altitudes in inclement weather conditions. Investigation results indicated that A320 aeroplanes equipped with Thales Avionics Part Number (P/N) 50620-10 or P/N C16195AA pitot probes appear to have a greater susceptibility to adverse environmental conditions than aeroplanes equipped with certain other pitot probes.

    Prompted by earlier occurrences, DGAC [Direction Générale de l'Aviation Civile] France issued [DGAC] AD 2001-362 [http://ad.easa.europa.eu/ad/F-2001-362] [which corresponds to paragraph (f) of FAA AD 2004-03-33, Amendment 39-13477 (69 FR 9936, March 3, 2004)] to require replacement of Thales (formerly known as Sextant) P/N 50620-10 pitot probes with Thales P/N C16195AA probes.

    Since that [DGAC] AD was issued, Thales pitot probe P/N C15195BA was designed, which improved airspeed indication behavior in heavy rain conditions, but did not demonstrate the same level of robustness to withstand high-altitude ice crystals. Based on these findings, EASA decided to implement replacement of the affected Thales [pitot] probes as a precautionary measure to improve the safety level of the affected aeroplanes.

    Consequently, EASA issued AD 2014-0237 (later revised) [http://ad.easa.europa.eu/blob/easa_ad_2014_0237.pdf/AD_2014-0237], retaining the requirements of DGAC France AD 2001-362, which was superseded, and cancelling two other [DGAC] ADs, to require replacement of Thales Avionics pitot probes P/N C16195AA and P/N C16195BA.

    Since EASA AD 2014-0237R1 [http://ad.easa.europa.eu/ad/2014-0237R1] was issued, results of further analyses have determined that the compliance time (48 months) of that AD has to be reduced in relation to the risk assessment.

    For the reasons described above, this [EASA] AD retains the requirements of EASA AD 2014-0237R1, which is superseded, but reduces the compliance time [24 months].

    You may examine the MCAI on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2016-6900.

    Related Service Information Under 1 CFR Part 51

    Airbus has issued the following service information:

    • Airbus Service Bulletin A320-34-1170, Revision 30, dated June 18, 2015.

    • Airbus Service Bulletin A320-34-1456, Revision 01, dated May 15, 2012.

    • Airbus Service Bulletin A320-34-1463, Revision 01, dated May 15, 2012.

    The service information describes procedures for replacing certain Thales pitot probes on the captain, first officer, and standby sides. 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 and Requirements of This AD

    This product has been approved by the aviation authority of another country, and is approved for operation in the United States. Pursuant to our bilateral agreement with the State of Design Authority, we have been notified of the unsafe condition described in the MCAI and service information referenced above. We are issuing this AD because we evaluated all pertinent information and determined the unsafe condition exists and is likely to exist or develop on other products of the same type design.

    Explanation of Compliance Time

    We have reduced the compliance time in this AD for the pitot probe replacement because of the new reports of airspeed indication discrepancies during flight at high altitudes in inclement weather. The MCAI requires replacement within 2 years after the effective date of the original MCAI 2014-0237 (November 12, 2014). Both EASA and Airbus recommend the pitot probe replacement in accordance with the MCAI requirement. Based on new reports of airspeed indication discrepancies, our risk assessment considered the overall risk to the fleet, including the severity of the failure and the likelihood of the failure's occurrence. In support of the MCAI compliance requirement and Airbus recommendation, we have therefore concluded that the pitot probes must be replaced by November 12, 2016. That compliance time corresponds to the date specified by the MCAI and represents an appropriate interval of time allowable for affected airplanes to continue to operate without compromising safety. In conjunction with the manufacturer, we have determined that the new compliance time will accommodate the time necessary to ensure the availability of required parts.

    FAA's Justification and Determination of the Effective Date

    An unsafe condition exists that requires the immediate adoption of this AD. The FAA has found that the risk to the flying public justifies waiving notice and comment prior to adoption of this rule because airspeed indication discrepancies caused by accumulation of ice crystals during inclement weather, which, depending on the prevailing altitude, could lead to reduced controllability of the airplane. Therefore, we determined that notice and opportunity for public comment before issuing this AD are impracticable and that good cause exists for making this amendment effective in fewer than 30 days.

    Comments Invited

    This AD is a final rule that involves requirements affecting flight safety, and we did not precede it by notice and opportunity for public comment. We invite you to send any written relevant data, views, or arguments about this AD. Send your comments to an address listed under the ADDRESSES section. Include “Docket No. FAA-2016-6900; Directorate Identifier 2016-NM-064-AD” at the beginning of your comments. We specifically invite comments on the overall regulatory, economic, environmental, and energy aspects of this AD. We will consider all comments received by the closing date and may amend this AD because of those comments.

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

    Costs of Compliance

    We estimate that this AD affects 953 airplanes of U.S. registry. We estimate the following costs to comply with this AD:

    Estimated Costs Action Labor cost Parts cost Cost per
  • product
  • Cost on U.S. operators
    Pitot probe replacement (retained actions from AD 2016-09-07) 4 work-hours × $85 per hour = $340 $21,930 $22,270 $21,223,310
    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 that this AD:

    1. Is not a “significant regulatory action” under Executive Order 12866;

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

    3. Will not affect intrastate aviation in Alaska; and

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

    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 airworthiness directive (AD) 2016-09-07, Amendment 39-18505 (81 FR 27298, May 6, 2016), and adding the following new AD: 2016-12-10 Airbus: Amendment 39-18559. Docket No. FAA-2016-6900; Directorate Identifier 2016-NM-064-AD. (a) Effective Date

    This AD is effective June 29, 2016.

    (b) Affected ADs

    (1) This AD replaces AD 2016-09-07, Amendment 39-18505 (81 FR 27298, May 6, 2016) (“AD 2016-09-07”).

    (2) This AD affects AD 2004-03-33, Amendment 39-13477 (69 FR 9936, March 3, 2004) (“AD 2004-03-33”).

    (c) Applicability

    This AD applies to the airplanes identified in paragraphs (c)(1), (c)(2), (c)(3), and (c)(4) of this AD, certificated in any category, all manufacturer serial numbers.

    (1) Airbus Model A318-111, -112, -121, and -122 airplanes.

    (2) Airbus Model A319-111, -112, -113, -114, -115, -131, -132, and -133 airplanes.

    (3) Airbus Model A320-211, -212, -214, -231, -232, and -233 airplanes.

    (4) Airbus Model A321-111, -112, -131, -211, -212, -213, -231, and -232 airplanes.

    (d) Subject

    Air Transport Association (ATA) of America Code 34, Navigation.

    (e) Reason

    This AD was prompted by reports of airspeed indication discrepancies during flight at high altitudes in inclement weather. We are issuing this AD to prevent airspeed indication discrepancies caused by accumulation of ice crystals during inclement weather, which, depending on the prevailing altitude, could lead to reduced controllability of the airplane.

    (f) Compliance

    Comply with this AD within the compliance times specified, unless already done.

    (g) Pitot Probe Replacement

    On or before November 12, 2016: Replace any Thales pitot probe having part number (P/N) C16195AA or P/N C16195BA with a Goodrich pitot probe having P/N 0851HL, in accordance with the Accomplishment Instructions of Airbus Service Bulletin A320-34-1170, Revision 30, dated June 18, 2015. The replacement in this paragraph terminates the requirements of paragraph (f) of AD 2004-03-33 for that airplane only.

    (h) Other Acceptable Compliance

    (1) Replacement of the pitot probes in accordance with the Accomplishment Instructions of both Airbus Service Bulletin A320-34-1456, Revision 01, dated May 15, 2012 (pitot probes on the captain and standby sides); and Airbus Service Bulletin A320-34-1463, Revision 01, dated May 15, 2012 (pitot probes on the first officer side); is an acceptable method of compliance for the requirements of paragraph (g) of this AD.

    (2) Airplanes on which Airbus Modification 25578 was embodied in production, except for post-modification 25578 airplanes on which Airbus Modification 155737 (installation of Thales pitot probes) was also embodied in production, are compliant with the requirements of paragraph (g) of this AD, provided it can be conclusively determined that no Thales pitot probe having P/N C16195AA, P/N C16195BA, or P/N 50620-10 has been installed since the date of issuance of the original certificate of airworthiness or the date of issuance of the original export certificate of airworthiness. Post-modification-25578 airplanes on which Airbus Modification 155737 (installation of Thales pitot probes) was also embodied in production must be in compliance with the requirements of paragraph (g) of this AD.

    (i) Credit for Previous Actions

    (1) This paragraph provides credit for the actions required by paragraph (g) of this AD, if those actions were performed before June 10, 2016 (the effective date of AD 2016-09-07), using service information identified in paragraphs (i)(1)(i) through (i)(1)(xxvi) of this AD. This service information is not incorporated by reference in this AD.

    (i) Airbus Service Bulletin A320-34-1170, Revision 04, dated May 24, 2000.

    (ii) Airbus Service Bulletin A320-34-1170, Revision 05, dated September 11, 2000.

    (iii) Airbus Service Bulletin A320-34-1170, Revision 06, dated October 18, 2001.

    (iv) Airbus Service Bulletin A320-34-1170, Revision 07, dated December 4, 2001.

    (v) Airbus Service Bulletin A320-34-1170, Revision 08, dated January 15, 2003.

    (vi) Airbus Service Bulletin A320-34-1170, Revision 09, dated February 17, 2003.

    (vii) Airbus Service Bulletin A320-34-1170, Revision 10, dated November 21, 2003.

    (viii) Airbus Service Bulletin A320-34-1170, Revision 11, dated August 18, 2004.

    (ix) Airbus Service Bulletin A320-34-1170, Revision 12, dated December 2, 2004.

    (x) Airbus Service Bulletin A320-34-1170, Revision 13, dated January 18, 2005.

    (xi) Airbus Service Bulletin A320-34-1170, Revision 14, dated April 21, 2005.

    (xii) Airbus Service Bulletin A320-34-1170, Revision 15, dated July 19, 2005.

    (xiii) Airbus Service Bulletin A320-34-1170, Revision 16, dated November 23, 2006.

    (xiv) Airbus Service Bulletin A320-34-1170, Revision 17, dated February 14, 2007.

    (xv) Airbus Service Bulletin A320-34-1170, Revision 18, dated October 9, 2009.

    (xvi) Airbus Service Bulletin A320-34-1170, Revision 19, dated November 9, 2009.

    (xvii) Airbus Service Bulletin A320-34-1170, Revision 20, dated December 1, 2010.

    (xviii) Airbus Service Bulletin A320-34-1170, Revision 21, dated March 24, 2011.

    (xix) Airbus Service Bulletin A320-34-1170, Revision 22, dated July 19, 2011.

    (xx) Airbus Service Bulletin A320-34-1170, Revision 23, dated February 3, 2012.

    (xxi) Airbus Service Bulletin A320-34-1170, Revision 24, dated April 12, 2012.

    (xxii) Airbus Service Bulletin A320-34-1170, Revision 25, dated September 4, 2012.

    (xxiii) Airbus Service Bulletin A320-34-1170, Revision 26, dated September 16, 2013.

    (xxiv) Airbus Service Bulletin A320-34-1170, Revision 27, dated March 18, 2014.

    (xxv) Airbus Service Bulletin A320-34-1170, Revision 28, dated September 1, 2014.

    (xxvi) Airbus Service Bulletin A320-34-1170, Revision 29, dated February 16, 2015.

    (2) This paragraph provides credit for the replacement of pitot probes on the captain and standby sides specified in paragraph (h)(1) of this AD, if the replacement was performed before June 10, 2016 (the effective date of AD 2016-09-07), using Airbus Service Bulletin A320-34-1456, dated December 2, 2009, which is not incorporated by reference in this AD.

    (3) This paragraph provides credit for the replacement of pitot probes on the first officer side as specified in paragraph (h)(1) of this AD, if those actions were performed before June 10, 2016 (the effective date of AD 2016-09-07), using Airbus Service Bulletin A320-34-1463, dated March 9, 2010, which is not incorporated by reference in this AD.

    (j) Parts Installation Limitations

    (1) At the applicable time specified in paragraph (j)(1)(i) or (j)(1)(ii) of this AD: No person may install on any airplane a Thales pitot probe having P/N C16195AA or P/N C16195BA.

    (i) For airplanes with a Thales pitot probe having P/N C16195AA or P/N C16195BA installed: After replacement with BF Goodrich pitot probe P/N 0851HL.

    (ii) For airplanes without a Thales pitot probe having P/N C16195AA or P/N C16195BA installed: As of June 10, 2016 (the effective date of AD 2016-09-07).

    (2) As of June 10, 2016 (the effective date of AD 2016-09-07), no person may install on any airplane a Thales pitot probe having P/N 50620-10.

    (k) Other FAA AD Provisions

    The following provisions also apply to this AD:

    (1) Alternative Methods of Compliance (AMOCs): The Manager, International Branch, ANM-116, Transport Airplane Directorate, 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 International Branch, send it to ATTN: Sanjay Ralhan, Aerospace Engineer, International Branch, ANM-116, Transport Airplane Directorate, FAA, 1601 Lind Avenue SW., Renton, WA 98057-3356; telephone: 425-227-1405; fax: 425-227-1149. Information may be emailed to: [email protected] 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. The AMOC approval letter must specifically reference this AD.

    (2) Contacting the Manufacturer: For any requirement in this AD to obtain corrective actions from a manufacturer, the action must be accomplished using a method approved by the Manager, International Branch, ANM-116, Transport Airplane Directorate, FAA; or the European Aviation Safety Agency (EASA); or Airbus's EASA Design Organization Approval (DOA). If approved by the DOA, the approval must include the DOA-authorized signature.

    (3) Required for Compliance (RC): If any service information contains procedures or tests that are identified as RC, those procedures and tests must be done to comply with this AD; any procedures or tests that are not identified as RC are recommended. Those procedures and tests that are not identified as RC may be deviated from using accepted methods in accordance with the operator's maintenance or inspection program without obtaining approval of an AMOC, provided the procedures and tests identified as RC can be done and the airplane can be put back in an airworthy condition. Any substitutions or changes to procedures or tests identified as RC require approval of an AMOC.

    (l) Related Information

    (1) Refer to Mandatory Continuing Airworthiness Information (MCAI) EASA Airworthiness Directive 2015-0205, dated October 9, 2015, for related information. This MCAI may be found in the AD docket on the Internet at http://www.regulations.gov by searching for and locating Docket No. FAA-2016-6900.

    (2) Service information identified in this AD that is not incorporated by reference is available at the addresses specified in paragraphs (m)(4) and (m)(5) of this AD.

    (m) 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 this AD specifies otherwise.

    (3) The following service information was approved for IBR on June 10, 2016 (81 FR 27298).

    (i) Airbus Service Bulletin A320-34-1170, Revision 30, dated June 18, 2015.

    (ii) Airbus Service Bulletin A320-34-1456, Revision 01, dated May 15, 2012.

    (iii) Airbus Service Bulletin A320-34-1463, Revision 01, dated May 15, 2012.

    (4) For service information identified in this AD, contact Airbus, Airworthiness Office—EIAS, 1 Rond Point Maurice Bellonte, 31707 Blagnac Cedex, France; telephone: +33 5 61 93 36 96; fax: +33 5 61 93 44 51; email: [email protected]; Internet: http://www.airbus.com.

    (5) You may view this 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.

    (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 Renton, Washington, on June 2, 2016. Michael Kaszycki, Acting Manager, Transport Airplane Directorate, Aircraft Certification Service.
    [FR Doc. 2016-13857 Filed 6-13-16; 8:45 am] BILLING CODE 4910-13-P
    DEPARTMENT OF TRANSPORTATION Federal Aviation Administration 14 CFR Part 71 [Docket No. FAA-2016-5573; Airspace Docket No. 16-ASO-7] RIN 2120-AA66 Modification of VOR Federal Airway V-552; Mississippi AGENCY:

    Federal Aviation Administration (FAA), DOT.

    ACTION:

    Final rule.

    SUMMARY:

    This action modifies VOR Federal airway V-552 by amending the route description to exclude the airspace within restricted area R-4403F, Stennis Space Center, MS, during periods when the restricted area is in use.

    DATES:

    Effective date 0901 UTC, September 15, 2016. The Director of the Federal Register approves this incorporation by reference action under Title 1, Code of Federal Regulations, part 51, subject to the annual revision of FAA, Order 7400.9 and publication of conforming amendments.

    ADDRESSES:

    FAA Order 7400.9Z, Airspace Designations and Reporting Points, and subsequent amendments can be viewed online at http://www.faa.gov/air_traffic/publications/. For further information, you can contact the Airspace Policy Group, Federal Aviation Administration, 800 Independence Avenue SW., Washington, DC 20591; telephone: (202) 267-8783. The Order is also available for inspection at the National Archives and Records Administration (NARA). For information on the availability of FAA Order 7400.9Z at NARA, call (202) 741-6030, or go to http://www.archives.gov/federal_register/code_of_federal-regulations/ibr_locations.html.

    FAA Order 7400.9, Airspace Designations and Reporting Points, is published yearly and effective on September 15.

    FOR FURTHER INFORMATION CONTACT:

    Paul Gallant, Airspace Policy Group, Office of Airspace Services, Federal Aviation Administration, 800 Independence Avenue SW., Washington, DC 20591; telephone: (202) 267-8783.

    SUPPLEMENTARY INFORMATION:

    Authority for This Rulemaking

    The FAA's authority to issue rules regarding aviation safety is found in Title 49 of the United States Code. 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. This rulemaking is promulgated under the authority described in Subtitle VII, Part A, Subpart I, Section 40103. Under that section, the FAA is charged with prescribing regulations to assign the use of the airspace necessary to ensure the safety of aircraft and the efficient use of airspace. This regulation is within the scope of that authority as it modifies the air traffic service route.

    History

    VOR Federal airway V-552 extends between Beaumont, TX, and Monroeville, AL. In that segment of the airway between the Picayune, MS, VOR/DME and the CAESA, MS, navigation fix, restricted area R-4403F infringes on the 4 nautical mile (NM) wide protected airspace on the south side of the airway. The northernmost point of R-4403F is approximately 3.73 NM from the centerline of the airway instead of the required 4 NM clearance. R-4403F is subject to intermittent use by Notice to Airmen (NOTAM) issued at least 24 hours in advance. This action amends the V-552 airway description to exclude the airspace in R-4403F from the airway while the restricted area is activated.

    VOR Federal airways are published in paragraph 6010(a) of FAA Order 7400.9Z dated August 6, 2015, and effective September 15, 2015, which is incorporated by reference in 14 CFR 71.1. The VOR Federal airway listed in this document will be subsequently amended in the Order.

    Availability and Summary of Documents for Incorporation by Reference

    This document amends FAA Order 7400.9Z, Airspace Designations and Reporting Points, dated August 6, 2015, and effective September 15, 2015. FAA Order 7400.9Z is publicly available as listed in the ADDRESSES section of this document. FAA Order 7400.9Z lists Class A, B, C, D, and E airspace areas, air traffic service routes, and reporting points.

    The Rule

    The FAA is amending Title 14 of the Code of Federal Regulations (14 CFR) part 71 by adding the words “The airspace within R-4403F is excluded during its times of use” to the regulatory text of VOR Federal airway V-552. Because this amendment is necessary to ensure the safe separation of airway traffic from restricted airspace when the restricted area is active, I find that notice and public procedure under 5 U.S.C. 553(b) are impractical and contrary to the public interest.

    Regulatory Notices and Analyses

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

    Environmental Review

    The FAA has determined that this action qualifies for categorical exclusion under the National Environmental Policy Act in accordance with FAA Order 1050.1F, Environmental Impacts: Policies and Procedures, paragraph 5-6.5a. This airspace action consists of modifying an airway and it is not expected to cause any potentially significant environmental impacts, and no extraordinary circumstances exists that warrant preparation of an environmental assessment.

    List of Subjects in 14 CFR Part 71

    Airspace, Incorporation by reference, Navigation (air).

    Adoption of the Amendment

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

    PART 71—DESIGNATION OF CLASS A, B, C, D, AND E AIRSPACE AREAS; AIR TRAFFIC SERVICE ROUTES; AND REPORTING POINTS 1. The authority citation for part 71 continues to read as follows: Authority:

    49 U.S.C. 106(f), 106(g); 40103, 40113, 40120; E.O. 10854, 24 FR 9565, 3 CFR, 1959-1963 Comp., p. 389.

    § 71.1 [Amended]
    2. The incorporation by reference in 14 CFR 71.1 of FAA Order 7400.9Z, Airspace Designations and Reporting Points, dated August 6, 2015 and effective September 15, 2015, is amended as follows: Paragraph 6010(a) Domestic VOR Federal Airways. V-552 [Amended] From Beaumont, TX, via INT Beaumont 056° and Lake Charles, LA, 272° radials; Lake Charles; INT Lake Charles 064° and Lafayette, LA, 281° radials; Lafayette; Tibby, LA; Harvey, LA; Picayune, MS; Semmes, AL; INT Semmes 063° and Monroeville, AL, 216° radials; to Monroeville. The airspace within restricted area R-4403F is excluded during its times of use.
    Issued in Washington, DC, on June 6, 2016. Leslie M. Swann, Acting Manager, Airspace Policy Group.
    [FR Doc. 2016-13938 Filed 6-13-16; 8:45 am] BILLING CODE 4910-13-P
    DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT 24 CFR Part 578 [Docket No. FR-5476-I-03] RIN 2506-AC29 Continuum of Care Program—Increasing Mobility Options for Homeless Individuals and Families With Tenant-Based Rental Assistance AGENCY:

    Office of the Assistant Secretary for Community Planning and Development, HUD.

    ACTION:

    Interim rule.

    SUMMARY:

    On July 31, 2012, HUD published an interim rule entitled “Homeless Emergency Assistance and Rapid Transition to Housing: Continuum of Care Program.” The Continuum of Care (CoC) program is designed to address the critical problem of homelessness through a coordinated community-based process of identifying needs and building a system of housing and services to address those needs. This rule amends the CoC program regulations to allow individuals and families to choose housing outside of a CoC's geographic area, subject to certain conditions, and to retain the tenant-based rental assistance under the CoC program. In addition to allowing individuals and families to choose housing outside of the CoC's geographic area, this interim rule exempts recipients and subrecipients from compliance with all nonstatutory regulations when a program participant moves to flee domestic violence, dating violence, sexual assault, or stalking. This relaxation of conditions is consistent with the Violence Against Women Reauthorization Act of 2013, directing greater protections for victims of domestic violence, dating violence, sexual assault, or stalking.

    DATES:

    Effective date: July 14, 2016.

    Comment due date: August 15, 2016.

    ADDRESSES:

    Interested persons are invited to submit comments regarding this rule to the Regulations Division, Office of General Counsel, 451 7th Street SW., Room 10276, Department of Housing and Urban Development, Washington, DC 20410-0500. Communications must refer to the above docket number and title. There are two methods for submitting public comments. All submissions must refer to the above docket number and title.

    1. Submission of Comments by Mail. Comments may be submitted by mail to the Regulations Division, Office of General Counsel, Department of Housing and Urban Development, 451 7th Street SW., Room 10276, Washington, DC 20410-0500.

    2. Electronic Submission of Comments. Interested persons may submit comments electronically through the Federal eRulemaking Portal at www.regulations.gov. HUD strongly encourages commenters to submit comments electronically. Electronic submission of comments allows the commenter maximum time to prepare and submit a comment, ensures timely receipt by HUD, and enables HUD to make them immediately available to the public. Comments submitted electronically through the www.regulations.gov Web site can be viewed by other commenters and interested members of the public. Commenters should follow the instructions provided on that site to submit comments electronically.

    Note:

    To receive consideration as public comments, comments must be submitted through one of the two methods specified above. Again, all submissions must refer to the docket number and title of the rule.

    No Facsimile Comments. Facsimile (fax) comments are not acceptable.

    Public Inspection of Public Comments. All properly submitted comments and communications submitted to HUD will be available for public inspection and copying between 8 a.m. and 5 p.m. weekdays at the above address. Due to security measures at the HUD Headquarters building, an advance appointment to review the public comments must be scheduled by calling the Regulations Division at 202-708-3055 (this is not a toll-free number). Individuals with speech or hearing impairments may access this number through TTY by calling the Federal Relay Service at 800-877-8339 (this is a toll-free number). Copies of all comments submitted are available for inspection and downloading at www.regulations.gov.

    FOR FURTHER INFORMATION CONTACT:

    Norm Suchar, Director, Office of Special Needs Assistance Programs, Office of Community Planning and Development, Department of Housing and Urban Development, 451 7th Street SW., Washington, DC 20410-7000; telephone number 202-708-4300 (this is not a toll-free number). Hearing- and speech-impaired persons may access this number through TTY by calling the Federal Relay Service at 800-877-8339 (this is a toll-free number).

    SUPPLEMENTARY INFORMATION:

    I. Background

    The Continuum of Care (CoC) program is authorized by the McKinney-Vento Homeless Assistance Act (McKinney-Vento), as amended by the Homeless Emergency Assistance and Rapid Transition to Housing Act of 2009, which is Division B of Public Law 111-22, approved May 20, 2009 (HEARTH Act). The purposes of the CoC program is to promote communitywide commitment to the goal of ending homelessness; provide funding for efforts by nonprofit providers and by State and local governments to quickly rehouse homeless individuals and families while minimizing the trauma and dislocation caused to homeless individuals, families, and communities by homelessness; promote access to and effective utilization of mainstream programs by homeless individuals and families; and optimize self-sufficiency among individuals and families experiencing homelessness. Section 1504 of the HEARTH Act directs HUD to establish regulations for the CoC program. (See 42 U.S.C. 11301 note.) On July 31, 2012, at 77 FR 45422, HUD published an interim rule to establish, in 24 CFR part 578, the regulatory framework for the CoC program and the CoC planning process.

    Continuum of Care not only is the name of the program, but refers to the body responsible for carrying out the duties under the CoC program. In order to be eligible for funds under the CoC program, representatives from relevant organizations within a geographic area must establish a CoC. Representatives from relevant organizations include nonprofit homeless assistance providers, victim service providers, faith-based organizations, governments, businesses, advocates, public housing agencies, school districts, social service providers, mental health agencies, hospitals, universities, affordable housing developers, law enforcement, and organizations that serve veterans and homeless and formerly homeless individuals. Where these organizations are located within the geographic area served by the CoC, HUD expects a representative of the organization to be a part of the CoC.

    Although HUD issued its July 31, 2012, rule for effect, HUD also sought public comment, and at the end of the public comment period on October 1, 2012, HUD had received 551 public comments. HUD received valuable feedback from the public comments. However, HUD did not immediately move to the next rule stage because HUD wanted to examine how the interim regulations worked in practice. HUD has gained valuable information on where modifications may need to be made to its existing CoC regulations, not only on the basis of public comments received, but also on the basis of experience with the existing regulations to date.

    II. This Rule

    This rule focuses on a narrow area of the existing CoC program regulations and that is the ability of an individual or family with tenant-based rental assistance funded through the CoC program to choose housing, outside of a CoC's geographic area, subject to certain conditions, and to retain the tenant-based rental assistance under the CoC program if the program participant moves outside the CoC's geographic area.

    McKinney-Vento and the CoC program regulations provide that CoC program grant funds may be used for rental assistance for homeless individuals and families. Rental assistance includes tenant-based rental assistance, project-based rental assistance, or sponsor-based rental assistance. With respect to tenant-based rental assistance, § 578.51 of the CoC program regulations states that tenant-based rental assistance is rental assistance in which program participants choose housing of an appropriate size in which to reside. However, the CoC program regulations limit use of tenant-based rental assistance to within the CoC's geographic area. This limitation was determined reasonable because to serve individuals and families outside of the CoC's geographic area may impose greater burden and cost on the recipient providing the assistance. The only exception in the CoC program regulations to the limitation for retention of tenant-based rental assistance is for program participants who are victims of domestic violence, dating violence, sexual assault, or stalking who are at imminent threat of further harm. These participants, however, must have complied with all other obligations of the program and must reasonably believe that they are imminently threatened by harm from further violence if they remain in the assisted dwelling unit.

    Commenters on the July 2012 interim rule advised that the exception to retention of tenant-based rental assistance to the CoC's geographic area was too narrow. HUD received comments, generally, about high-cost housing markets and the difficulty that providers are having in locating affordable units within their CoC's geographic area because of the high cost of housing. A commenter stated that the requirement to use CoC program funds within the CoC's geographic area would cause undue hardship for clients and subrecipients due to the difficulty and time required to find affordable units in high-cost areas of their State. HUD also received comments about how the limitation requiring CoC program funds to be used within the CoC's geographic area restricted tenant-choice and limited opportunities for program participants to identify affordable housing. In response to these concerns, several commenters proposed, as a partial solution, that the regulation be changed to permit program participants to use CoC program funds to rent units outside of the CoC's geographic area.

    In light of the comments received on increasing mobility in the CoC program, and HUD's recently issued Affirmatively Furthering Fair Housing final rule, which emphasizes the importance of housing choice,1 HUD has determined to amend the CoC program regulations to allow all individuals and families receiving tenant-based rental assistance being paid for with CoC program funds (program participants) to choose housing outside of the CoC's geographic area and to retain their tenant-based rental assistance if they move outside of the CoC's geographic area, subject to the following conditions:

    1 See Affirmatively Furthering Fair Housing final rule, published on July 16, 2015, at 80 FR 42272.

    • The decision of a program participant to choose housing or move outside of the CoC's geographic area is one that is made in consultation between the program participant and the recipient or subrecipient.

    • The recipient or subrecipient may decline a program participant's request to choose housing or move outside of the CoC's geographic area if the recipient or subrecipient is unable to comply with all CoC program requirements in the geographic area where the housing selected by the program participant is selected, including ensuring the housing meets required safety and quality standards (at the time of publication of this rule compliance with Housing Quality Standards (HQS) is required), carrying out environmental reviews where necessary, calculating the program participant's income for determining rent contributions, conducting an annual assessment of the program participant's service needs, making supportive services available for the duration of the program participant's residence in the project, ensuring supportive services are provided in compliance with all State and local licensing codes, and providing monthly case management in the case of rapid rehousing (RRH) projects. The only reason the provider may decline a program participant's request to choose housing or move outside of the CoC's geographic area is that the recipient or subrecipient cannot reasonably meet all statutory and regulatory program requirements. If the program participant's request to move is declined, but the program participant believes the provider could have reasonably accommodated the request, the program participant may contact the CoC or HUD directly.

    • The receiving CoC (the CoC with jurisdiction over the geographic area to which the program participant seeks to move) is not involved in the decision to allow a program participant to move. Since discretion to move rests with the program participant, in consultation with the recipient or subrecipient providing the tenant-based rental assistance, with the goal being continuation of service by the original recipient or subrecipient, the receiving CoC may not prohibit the program participant from moving into its geographic area.

    • The program participant remains in the Homeless Management Information System of the CoC where the program participant is enrolled for assistance.

    In brief, this rule provides the opportunity for persons who are experiencing homelessness to have access to additional possible housing options while still maintaining their tenant-based rental assistance from the recipient within the CoC where they were determined eligible for, and began receiving assistance. This rule will accomplish this by allowing program participants to use their tenant-based rental assistance in an area outside of the CoC's geographic area where the household presented for, and was determined eligible for CoC program-funded tenant-based rental assistance. While this interim rule allows for expanded mobility, HUD anticipates that tenant-based rental assistance will be used principally within the CoC's geographic area.

    With respect to a CoC program participant who has tenant-based rental assistance and is fleeing imminent threat of further harm from domestic violence, the existing regulations allow such participant to move outside of the CoC's geographic area, but the program participant's move is subject to the program participant having complied with all program requirements during their residence in the CoC's geographic area. This rule would exempt the recipient or subrecipient from regulatory requirements (such as providing monthly case management for RRH projects and conducting an annual assessment of the service needs of the program participant that has moved), but the recipient or subrecipient would not be exempt from statutory requirements such as participating in HMIS, ensuring housing meets quality standards, and ensuring the educational needs of children are met. This amendment would facilitate ensuring the safety needs of victims of domestic violence, dating violence, sexual assault, or stalking by imposing less burdensome requirements on recipients and subrecipients while still ensuring that the housing that will be occupied by the victim of domestic violence, dating violence, sexual assault, or stalking meets all statutory requirements, including minimum quality standards.

    Specific Request for Comment: HUD seeks input from providers on the impact of exempting recipients or subrecipients from nonstatutory regulatory requirements when a program participant is fleeing imminent threat of further harm from domestic violence, dating violence, sexual assault, or stalking, and moves to another CoC's geographic area.

    HUD also seeks input on exempting recipients or subrecipients from non-statutory regulatory requirements when any program participant, not just a program participant fleeing imminent threat of further harm from domestic violence, dating violence, sexual assault, or stalking, wishes to move outside of the CoC's geographic area, in order to support mobility of tenants that may be moving to access better job opportunities, schools, or other resources.

    III. Justification for Interim Rulemaking

    In accordance with its regulations on rulemaking at 24 CFR part 10, HUD, generally, publishes its rules for advance public comment.2 Notice and public procedures may be omitted, however, if HUD determines that, in a particular case or class of cases, notice and public comment procedures are “impracticable, unnecessary, or contrary to the public interest.” (See 24 CFR 10.1.)

    2 The Administrative Procedure Act (5 U.S.C. Subchapter II) (APA), which governs Federal rulemaking, provides in section 553(a) that matters involving a military or foreign affairs function of the United States or a matter relating to Federal agency management or personnel or to public property, loans, grants, benefits, or contracts are exempt from the advance notice and public comment requirement of sections 553(b) and (c) of the APA. In its regulations in 24 CFR 10.1, HUD has waived the exemption for advance notice and public comment for matters that relate to public property, loans, grants, benefits, or contracts, and has committed to undertake notice and comment rulemaking for these matters.

    In this case, HUD has determined that it would be contrary to the public interest to delay these two amendments to the existing CoC regulations. HUD's work, subsequent to the July 2012, CoC interim rule on improving the voucher portability process, and the enactment of the Violence Against Women Act of 2013 3 emphasized to HUD the need to provide for mobility for participants in its programs and not terminating tenant-based assistance. As noted in HUD's Streamlining the Portability Process final rule,4 and in HUD's Affirmatively Furthering Fair Housing final rule, mobility allows individuals or families greater choice in living in the areas of their choice. As noted in the preamble, this interim rule would allow program participants, in consultation with their service providers, to move to outside of a CoC's geographic area of service. The consultation is necessary because the goal is to strive for and ensure continued CoC service to the program participant. The interim rule removes the prohibition that only allowed individuals and families who are victims of domestic violence, dating violence, sexual assault, or stalking to move outside of the CoC's geographic area of service. Additionally, this rule removes additional requirements imposed on individuals and families who are victims of domestic violence, dating violence, sexual assault, or stalking seeking to move outside of CoC's geographic area of service, which may delay the ability of such individuals or families to move to a safe location.

    3 Public Law 113-4, approved March 7, 2013.

    4 See final rule published on August 20, 2015, at 80 FR 50564.

    VI. Findings and Certifications Regulatory Review—Executive Orders 12866 and 13563

    Under Executive Order 12866 (Regulatory Planning and Review), a determination must be made whether a regulatory action is significant and, therefore, subject to review by the Office of Management and Budget (OMB) in accordance with the requirements of the order. Executive Order 13563 (Improving Regulations and Regulatory Review) directs executive agencies to analyze regulations that are “outmoded, ineffective, insufficient, or excessively burdensome, and to modify, streamline, expand, or repeal them in accordance with what has been learned.” Executive Order 13563 also directs that, where relevant, feasible, and consistent with regulatory objectives, and to the extent permitted by law, agencies are to identify and consider regulatory approaches that reduce burdens and maintain flexibility and freedom of choice for the public. This rule was determined to be a “significant regulatory action,” as defined in section 3(f) of Executive Order 12866 (although not an economically significant regulatory action, as provided under section 3(f)(1) of the Executive order).

    HUD expects it will receive few requests from program participants who are not domestic violence victims to move outside of the CoC's geographic area where they are currently residing. HUD does expect some requests will arise from program participants residing with the jurisdictions of CoCs that cover small geographic areas. HUD expects no increase or decrease in the number of requests from program participants who are victims of domestic violence as these program participants already have this flexibility. For these reasons, HUD believes the impact of this rule would be minimal, but the flexibility to move provided would align with two major HUD rulemakings: HUD's Affirmatively Furthering Fair Housing final rule and HUD's Violence Against Women Act 2013 final rule, to be issued later this year.

    The docket file is available for public inspection in the Regulations Division, Office of General Counsel, Department of Housing and Urban Development, 451 7th Street SW., Room 10276, Washington, DC 20410-0500. Due to security measures at the HUD Headquarters building, please schedule an appointment to review the docket file by calling the Regulations Division at 202-708-3055 (this is not a toll-free number). Individuals with speech or hearing impairments may access this number via TTY by calling the Federal Relay Service at 800-877-8339 (this is a toll-free number).

    Environmental Impact

    This rule covers tenant-based rental assistance. Accordingly, under 24 CFR 50.19(b)(11), this rule is categorically excluded from environmental review under the National Environmental Policy Act of 1969 (42 U.S.C. 4321).

    Unfunded Mandates Reform Act

    The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) (UMRA) establishes requirements for Federal agencies to assess the effects of their regulatory actions on State, local, and tribal governments and on the private sector. This interim rule does not impose a Federal mandate on any State, local, or tribal governments, or on the private sector, within the meaning of UMRA.

    Regulatory Flexibility Act

    The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) generally requires an agency to conduct a regulatory flexibility analysis of any rule subject to notice and comment rulemaking requirements, unless the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. This rule solely addresses the ability of individuals and families participating in the CoC program and who have tenant-based rental assistance to move outside of a CoC's geographic service area but continue to be serviced by that CoC or under the CoC program.

    Notwithstanding HUD's determination that this rule will not have a significant effect on a substantial number of small entities, HUD specifically invites comments regarding any less burdensome alternatives to this rule that will meet HUD's objectives as described in this preamble.

    Executive Order 13132, Federalism

    Executive Order 13132 (entitled “Federalism”) prohibits an agency from publishing any rule that has federalism implications if the rule either imposes substantial direct compliance costs on State and local governments and is not required by statute, or the rule preempts State law, unless the agency meets the consultation and funding requirements of section 6 of the Executive order. This interim rule does not have federalism implications and does not impose substantial direct compliance costs on State and local governments nor preempt State law within the meaning of the Executive order.

    List of Subjects in 24 CFR Part 578

    Community facilities, Continuum of Care, Emergency solutions grants, Grant programs—housing and community development, Grant program—social programs, Homeless, Rural housing, Reporting and recordkeeping requirements, Supportive housing programs—housing and community development, Supportive services.

    Accordingly, for the reasons described in the preamble, HUD amends 24 CFR part 578 to read as follows:

    PART 578—CONTINUUM OF CARE PROGRAM 1. The authority citation for part 578 continues to read as follows: Authority:

    42 U.S.C. 11371 et seq., 42 U.S.C. 3535(d).

    2. In § 578.51, paragraph (c) is revised to read as follows:
    § 578.51 Rental assistance.

    (c) Tenant-based rental assistance. Tenant-based rental assistance is rental assistance in which program participants choose housing of an appropriate size in which to reside. Up to 5 years' worth of rental assistance may be awarded to a project in one competition.

    (1) When necessary to facilitate the coordination of supportive services, recipients and subrecipients may require program participants to live in a specific area for their entire period of participation, or in a specific structure for the first year and in a specific area for the remainder of their period of participation. Program participants who are receiving rental assistance in transitional housing may be required to live in a specific structure for their entire period of participation in transitional housing.

    (2) Program participants who have complied with all program requirements during their residence retain the rental assistance if they move.

    (3) Program participants who have complied with all program requirements during their residence, who have been a victim of domestic violence, dating violence, sexual assault, or stalking, who reasonably believe they are imminently threatened by harm from further domestic violence, dating violence, sexual assault, or stalking (which would include threats from a third party, such as a friend or family member of the perpetrator of the violence) if they remain in the assisted unit, and who are able to document the violence and basis for their belief, may retain the rental assistance and move to a different Continuum of Care geographic area if they move out of the assisted unit to protect their health and safety. These program participants may move to a different Continuum of Care's geographic service area even if the recipient or subrecipient cannot meet all regulatory requirements of this part in the new geographic area where the unit is located. The recipient or subrecipient, however, must be able to meet all statutory requirements of the Continuum of Care program either directly or through a third-party contract or agreement.

    (4) Program participants other than those described in paragraph (c)(3) of this section may choose housing outside of the Continuum of Care's geographic area if the recipient or subrecipient, through its employees or contractors, is able to meet all requirements of this part in the geographic area where the program participant chooses housing. If the recipient or subrecipient is unable to meet the requirements of this part, either directly or through a third-party contract or agreement, the recipient or subrecipient may refuse to permit the program participant to retain the tenant-based rental assistance if the program participant chooses to move outside of the Continuum of Care's geographic area.

    Dated: May 24, 2016. Harriet Tregoning, Principal Deputy Assistant Secretary for Community Planning and Development. Approved on: May 24, 2016. Nani A. Coloretti, Deputy Secretary.
    [FR Doc. 2016-13684 Filed 6-13-16; 8:45 am] BILLING CODE 4210-67-P
    DEPARTMENT OF THE INTERIOR Bureau of Indian Affairs 25 CFR Part 41 [167A2100DD/AAKC001030/A0A501010.999900 253G] RIN 1076-AF08 Grants to Tribal Colleges and Universities and Diné College AGENCY:

    Bureau of Indian Affairs, Interior.

    ACTION:

    Final rule.

    SUMMARY:

    The Bureau of Indian Education is updating its regulations governing grants to Tribal colleges and universities and Diné College. The Tribally Controlled Colleges and Universities Assistance Act of 1978, as amended (TCCUA), authorizes Federal assistance to institutions of higher education that are formally controlled or have been formally sanctioned or chartered by the governing body of an Indian Tribe or Tribes. The Navajo Community College Assistance Act of 1978, as amended (NCCA) authorizes Federal assistance to the Navajo Nation in construction, maintenance, and operation of Diné College. This final rule would update implementing regulations in light of amendments to the TCCUA and the NCCA.

    DATES:

    This rule is effective July 14, 2016.

    FOR FURTHER INFORMATION CONTACT:

    Ms. Juanita Mendoza, Acting Chief of Staff, Bureau of Indian Education (202) 208-3559.

    SUPPLEMENTARY INFORMATION:

    I. Background II. The Rule's Changes to the Current Regulations III. Comments Received on the Proposed Rule and Responses to Comments IV. Procedural Requirements A. Regulatory Planning and Review (E.O. 12866) B. Regulatory Flexibility Act C. Small Business Regulatory Enforcement Fairness Act D. Unfunded Mandates Reform Act E. Takings (E.O. 12630) F. Federalism (E.O. 13132) G. Civil Justice Reform (E.O. 12988) H. Consultation with Indian Tribes (E.O. 13175) I. Paperwork Reduction Act J. National Environmental Policy Act K. Effects on the Energy Supply (E.O. 13211) L. Drafting Information I. Background

    The TCCUA authorizes grants for operating and improving Tribal colleges and universities to insure [sic] continued and expanded educational opportunities for Indian students and to allow for the improvement and expansion of the physical resources of such institutions. See, 25 U.S.C. 1801 et seq. The TCCUA also authorizes grants for the encouragement of endowment funds for the operation and improvement of Tribal colleges and universities. The NCCA authorizes grants to the Navajo Nation to assist in the construction, maintenance and operation of Diné College. See 25 U.S.C. 640a et seq.

    In 1968, the Navajo Nation created the first Tribal college, now called Diné College—and other Tribal colleges quickly followed in California, North Dakota, and South Dakota. Today, there are 37 Tribal colleges in 17 states. The Tribally controlled institutions were chartered by one or more Tribes and are locally managed.

    Tribal colleges generally serve geographically isolated populations. In a relatively brief period of time, they have become essential to educational opportunity for American Indian students. Tribal colleges are unique institutions that combine personal attention with cultural relevance, in such a way as to encourage American Indians—especially those living on reservations—to overcome barriers to higher education.

    II. The Rule's Changes to the Current Regulations

    The regulations at 25 CFR part 41 were originally published in 1979. Since the Tribally Controlled Community College Assistance Act of 1978 (Pub. L. 95-471, Title I) was enacted on October 17, 1978, over 30 years of amendments to the Act have been made. These include Public Law 98-192 (December 1, 1983), Public Law 99-428 (September 30, 1996), Public Law 105-244 (October 7, 1998), and Public Law 110-315 (August 14, 2008). Similarly, the Navajo Community College Assistance Act of 1978 (Pub. L. 95-471, Title II) was amended by Public Law 110-315 (August 14, 2008). This final rule incorporates updates required by those amendments. Specifically, the final rule:

    • Makes “plain language” revisions under Executive Order 12866 and 12988 and by the Presidential Memorandum of June 1, 1998;

    • Updates institutional names (e.g., changing “Director, Office of Indian Education Programs” to “Director of the Bureau of Indian Education”);

    • Adds statutory authorities and makes accompanying statutory updates; and

    • Combines the purpose, scope, and definitions into a new subpart A.

    Significant changes the final rule makes include clarifying that: (1) The calculation of an Indian Student Count (ISC) only includes students making satisfactory progress, as defined by the Tribal college, towards a degree or certificate; (2) no credit hours earned by a high school student that will be used towards the student's high school degree or its equivalent are included in the ISC; and (3) grantees may exclude high school students for the purpose of calculating the total number of full-time equivalent students. Changes clarify often misunderstood requirements for an ISC and when high school students cannot be counted towards an ISC. The final rule also updates definitions per amended legislation; reorganizes and clarifies institutional grant eligibility, grant application procedures, Department of the Interior (DOI) grant reporting requirements, and essential information for determining Indian student eligibility. Presently, information is embedded in extended definitions and is difficult to find; the changes increase accessibility and correct outdated language and requirements.

    The final rule makes several terminology changes throughout to reflect statutory language. These include replacing “Tribally controlled community colleges” with “Tribal colleges and universities,” replacing “Navajo Community College” with “Diné College,” and replacing “feasibility” with “eligibility” in appropriate places. A detailed table listing changes from the current rule to the final rule can be referenced in the publication of the proposed rule, 80 FR 49946 (August 18, 2015) because there have been no significant changes from the proposed to the final version of this rule.

    III. Comments Received on the Proposed Rule and Responses to Comments

    The BIE received one written comment and five oral comments. The following summarizes the comments received and our responses.

    A. Definitions (41.3)

    One commenter stated a concern that limiting the calculation of ISC to only include students making satisfactory progress would lead to a decrease in funding that could be used to help the very students who need it. The final rule indicates satisfactory progress is defined by the Tribal college or university. Tribal colleges and universities have accreditation requirements set by a nationally recognized accrediting agency or association determined by the U.S. Secretary of Education. Therefore, each Tribal college or university sets the requirements to meet satisfactory progress towards a degree or certificate.

    A commenter asked why the proposed rule failed to include a definition of “unused portion of received funds”. The final rule details how the Tribal college or university reports how much funds remain unspent and how the BIE will reallocate the unspent funds, incorporating the definition. See 25 CFR 41.33.

    B. Indian Student Count (41.5)

    Three comments addressed how ISC is determined. The first comment noted there is a reduction in time for counting Full-Time Equivalents (FTEs) from the first six weeks to the first three weeks of the semester, and asked what implications this would have on Tribal colleges and universities that have an add/drop deadline after the first three-weeks. The final rule, implementing an explicit requirement at 25 U.S.C. 1801(b)(1), requires ISC to be calculated on the basis of Indian students who are registered at the conclusion of the third week.

    The second comment noted there is inconsistency throughout the regulation with the use of the term “students” and requested clarification as to whether the student is Native or non-Native. The definition of “Indian student” includes a student who is a member of an Indian Tribe or a biological child of a living or deceased member of an Indian Tribe. See 25 U.S.C. 1801(a)(7); 25 CFR 41.3. The final rule replaces “student” with “Indian student” where applicable to clarify that the provisions address Indian students only. See, e.g., 25 CFR 41.5.

    The third comment asked about whether online students are included in the ISC calculation and whether those students must also be Indian students. The final rule includes distance learning students who otherwise meet the definition of “Indian student” in the ISC count. See 25 CFR 41.5. The final rule's definition of “Indian student” includes a student who is a member of an Indian Tribe or a biological child of a living or deceased member of an Indian Tribe; documentation is required to verify eligibility. See 25 U.S.C. 1801(a)(7); 25 CFR 41.3.

    C. Role of the Secretary of Education (41.17)

    A commenter asked what the role of the U.S. Secretary of Education is, and if there will be any consultations between the Secretary of Education, Director of the BIE, and Tribes that charter Tribal colleges and universities to discuss how they can expand their joint responsibilities. The final rule establishes the role of the Secretary of Education at § 41.17. The BIE follows the Department of the Interior Tribal Consultation Policy and consults with Tribes on policies that have a substantial direct effect on one or more Tribes.

    IV. Procedural Requirements A. Regulatory Planning and Review (E.O. 12866)

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

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

    B. Regulatory Flexibility Act

    The Department certifies that this rule will not have a significant economic effect on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.). It does not have any effect on small entities because only Tribal colleges and universities are recipients of funding under the program governed by this rule. The Department provides funding to Tribal colleges and universities, which were created in response to the higher education needs of American Indians and generally serve geographically isolated populations that have no other means of accessing education beyond the high school level.

    C. Small Business Regulatory Enforcement Fairness Act

    This rule is not a major rule under 5 U.S.C. 804(2), the Small Business Regulatory Enforcement Fairness Act. This rule does not have an annual effect on the economy of $100 million or more in any one year, will not cause a major increase in costs or prices for consumers, individual industries, Federal, State, or local government agencies, or geographic regions, and does not have significant adverse effects on competition, employment, investment, productivity, innovation, or the ability of the U.S.-based enterprises to compete with foreign-based enterprises. This rule is limited to addressing grants for Tribal colleges and universities that are below the stated threshold and funding for the operation and improvement of Tribal colleges and universities comes from the Federal Government budget.

    D. Unfunded Mandates Reform Act

    This rule does not impose an unfunded mandate on State, local, or Tribal governments or the private sector of more than $100 million per year. The rule does not have a significant or unique effect on State, local, or Tribal governments or the private sector. A statement containing the information required by the Unfunded Mandates Reform Act (2 U.S.C. 1531 et seq.) is not required.

    E. Takings (E.O. 12630)

    Under the criteria in Executive Order 12630, this rule does not affect individual property rights protected by the Fifth Amendment nor does it involve a compensable “taking”. A takings implication assessment is not required.

    F. Federalism (E.O.) 13132

    Under the criteria in Executive Order 13132, this rule has no 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. This rule implements statutory provisions that authorize grants for operating and improving Tribal colleges or universities to ensure continued and expanded educational opportunities for Indian students by providing financial assistance to be used for the operating expenses of education programs. Because the rule does not affect the Federal government's relationship to the States or the balance of power and responsibilities among various levels of government, it will not have sufficient federalism implications to warrant the preparation of a federalism summary impact statement.

    G. Civil Justice Reform (E.O. 12988)

    This rule complies with the requirements of Executive Order 12988. Specifically, this rule has been reviewed to eliminate errors and ambiguity and written to minimize litigation; and is written in clear language and contains clear legal standards.

    H. Consultation With Indian Tribes (E.O. 13175)

    The Department strives to strengthen its government-to-government relationship with Indian Tribes through a commitment to consultation with Indian Tribes and recognition of their right to self-governance and Tribal sovereignty. We have evaluated this rule under the Department's consultation policy and under the criteria in Executive Order 13175 and have identified substantial direct effects on federally recognized Indian Tribes that will result from this rule. This rule will further implement the grants program for Tribal colleges and universities; accordingly, we have coordinated with representatives of federally recognized Tribes throughout the development of this rule. We collaborated with the American Indian Higher Education Consortium (AIHEC), which represents Tribal colleges and universities that will be affected by the rule. Presidents of Tribal colleges and universities provided the initial comments and drafted the Preliminary Discussion Draft. The BIE held five consultation sessions in 2014 (79 FR 54936, September 15, 2014) on the Preliminary Discussion Draft. The BIE received 35 comments and those that were significant were considered into the proposed rule. Following publication of the proposed rule, BIE hosted two Tribal consultation sessions with Indian Tribes. BIE has addressed the input received during those sessions in this final rule.

    I. Paperwork Reduction Act

    The Paperwork Reduction Act (PRA), 44 U.S.C. 3501 et seq., prohibits a Federal agency from conducting or sponsoring a collection of information that requires Office of Management and Budget (OMB) approval, unless such approval has been obtained and the collection request displays a currently valid OMB control number. Nor is any person required to respond to an information collection request that has not complied with the PRA. This rule contains information collection requirements that already have OMB approval and are not being revised. OMB has approved the information collections and assigned two control numbers: OMB Control Number 1076-0018, and OMB Control Number 1076-0105, each expiring on December 31, 2018, and each with an estimated annual burden of 308 hours.

    J. National Environmental Policy Act

    This rule does not constitute a major Federal action significantly affecting the quality of the human environment. A detailed statement under the National Environmental Policy Act of 1969 (NEPA) is not required because the rule is covered by a categorical exclusion. See 43 CFR 46.210(i). We have also determined that this rule does not involve any of the extraordinary circumstances listed in 43 CFR 46.215 that would require further analysis under NEPA.

    K. Effects on the Energy Supply (E.O. 13211)

    This rule is not a significant energy action under the definition in Executive Order 13211. A Statement of Energy Effects is not required.

    L. Drafting Information

    The primary authors of this document are Juanita Mendoza, Acting Chief of Staff, Bureau of Indian Education, Dawn Baum, Office of the Solicitor—Division of Indian Affairs, and Regina Gilbert, Office of Regulatory Affairs & Collaborative Action—Indian Affairs, Department of the Interior.

    List of Subjects in 25 CFR Part 41

    Colleges or universities, Grants programs—education, Grant programs—Indians, Indians—education, Reporting and recordkeeping requirements.

    For the reasons given in the preamble, the Department of the Interior amends title 25 of the Code of Federal Regulations to revise part 41 to read as follows:

    PART 41—GRANTS TO TRIBAL COLLEGES AND UNIVERSITIES AND DINÉ COLLEGE Subpart A—Applicability and Definitions Sec. 41.1 When does this subpart apply? 41.3 What definitions are needed? 41.5 How is ISC/FTE calculated? 41.7 What happens if false information is submitted? Subpart B—Tribal Colleges and Universities 41.9 What is the purpose of this subpart? 41.11 Who is eligible for financial assistance under this subpart? 41.13 For what activities can financial assistance to Tribal colleges and universities be used? 41.15 What activities are prohibited? 41.17 What is the role of the Secretary of Education? 41.19 How can a Tribal college or university establish eligibility to receive a grant? 41.21 How can a Tribe appeal the results of an eligibility study? 41.23 Can a Tribal college or university request a second eligibility study? 41.25 How does the Tribal college or university apply for a grant? 41.27 When can the Tribal college or university expect a decision on its application? 41.29 How will a grant be awarded? 41.31 When will the Tribal college or university receive funding? 41.33 What if there isn't enough money to pay the full grant amount? 41.35 What will happen if the Tribal college or university doesn't receive its appropriate share? 41.37 Is the Tribal college or university eligible for other grants? 41.39 What reports does the Tribal college or university need to provide? 41.41 Can the Tribal college or university receive technical assistance? 41.43 How must the Tribal college or university administer its grant? 41.45 How does the Tribal college or university apply for programming grants? 41.47 Are Tribal colleges or universities eligible for endowments? Subpart C—Diné College 41.49 What is the purpose of this subpart? 41.51 What is the scope of this subpart? 41.53 How does Diné College request financial assistance? 41.55 How are grant funds processed? 41.57 When will the application be reviewed? 41.59 When will the funds be paid? 41.61 Is Diné College eligible to receive other grants? 41.63 How can financial assistance be used? 41.65 What reports must be provided? 41.67 Can Diné College receive technical assistance? 41.69 How must Diné College administer its grant? 41.71 Can Diné College appeal an adverse decision under a grant agreement by the Director? Authority:

    Public Law 95-471, Oct. 17, 1978, 92 Stat. 1325; amended Public Law 98-192, Dec. 1, 1983, 97 Stat. 1335; Public Law 99-428, Sept. 30, 1986, 100 Stat. 982; Public Law 105-244, Oct. 7, 1998, 112 Stat. 1619; Public Law 110-315, Aug. 14, 2008, 122 Stat. 3460; 25 U.S.C. 1801 et seq.; Public Law 98-192, Dec. 15, 1971, 85 Stat. 646; and Public Law 110-315, Aug. 14, 2008, 122 Stat. 3468; 25 U.S.C. 640a et seq.

    Subpart A—Applicability and Definitions
    § 41.1 When does this subpart apply?

    The provisions in this subpart A apply to subparts B and C.

    § 41.3 What definitions are needed?

    As used in this part:

    Academic facilities mean structures suitable for use as:

    (1) Classrooms, laboratories, libraries, and related facilities necessary or appropriate for instruction of students;

    (2) Research facilities;

    (3) Facilities for administration of educational or research programs;

    (4) Dormitories or student services buildings; or

    (5) Maintenance, storage, support, or utility facilities essential to the operation of the foregoing facilities.

    Academic term means a semester, trimester, or other such period (not less than six weeks in duration) into which a Tribal college or university normally subdivides its academic year, but does not include a summer term.

    Academic year means a twelve month period established by a Tribal college or university as the annual period for the operation of the Tribal college's or university's education programs.

    Assistant Secretary means the Assistant Secretary—Indian Affairs of the Department of the Interior.

    BIE means the Bureau of Indian Education.

    College or university means an institution of higher education that is formally controlled, formally sanctioned, or chartered by the governing body of an Indian Tribe or Tribes. To qualify under this definition, the college or university must:

    (1) Be the only institution recognized by the Department for the Tribe, excluding Diné College; and

    (2) If under the control, sanction, or charter of more than one Tribe, be the only institution recognized by the Department for at least one Tribe that currently has no other formally controlled, formally sanctioned, or chartered college or university.

    Department means the Department of the Interior.

    Director means the Director of the Bureau of Indian Education.

    Eligible continuing education units (CEUs) means non-degree credits that meet the criteria established by the International Association of Continuing Education and Training.

    Full-time means registered for 12 or more credit hours for an academic term.

    Indian Student Count (ISC) or Indian Full-Time Equivalent (FTE) means a number equal to the total number of Indian students enrolled at a Tribal college or university, determined according to the formula in § 41.5.

    Indian student means a student who is a member of an Indian Tribe, or a biological child of a living or deceased member of an Indian Tribe. Documentation is required to verify eligibility as a biological child of a living or deceased member of an Indian Tribe, and may include birth certificate and marriage license; Tribal records of student's parent; Indian Health Service eligibility cards; other documentation necessary to authenticate a student as eligible to be counted as an Indian student under this definition.

    Indian Tribe means an Indian Tribe, band, nation, pueblo, rancheria, or other organized group or community, including any Alaska Native Village or regional or village corporation as defined in or established pursuant to the Alaska Native Claims Settlement Act, to be listed in the Federal Register pursuant to 25 CFR 83.5(a) as recognized by and eligible to receive services from the Bureau of Indian Affairs.

    Institution of higher education means an institution as defined by section 1001(a) of Title 20 of the United States Code, except that clause (2) of such section is not applicable and the reference to Secretary in clause (5)(A) of such section will be deemed to refer to the Secretary of the Interior.

    National Indian organization means an organization which the Secretary finds to be nationally based, represents a substantial Indian constituency and has expertise in the fields of Tribal colleges and universities, and Indian higher education.

    NCCA means the Navajo Community College Act of 1978, as amended (25 U.S.C. 640a et seq.).

    Operating expenses of education programs means the obligations and expenditures of a Tribal college or university for postsecondary education, except for obligations and expenditures for acquisition or construction of academic facilities. Permissible expenditures may include:

    (1) Administration;

    (2) Instruction;

    (3) Maintenance and repair of facilities; and

    (4) Acquisition and upgrade of equipment, technological equipment, and other physical resources.

    Part-time means registered for less than 12 credit hours for an academic term.

    Satisfactory progress means satisfactory progress toward a degree or certificate as defined by the Tribal college or university.

    Secretary, unless otherwise designated, means the Secretary of the Interior, or his/her duly authorized representative.

    TCCUA means the Tribally Controlled Colleges and Universities Assistance Act of 1978, as amended (25 U.S.C. 1801 et seq.).

    You or your means the Tribal college or university.

    § 41.5 How is ISC/FTE calculated?

    (a) ISC is calculated on the basis of eligible registrations of Indian students as of the conclusion of the third week of each academic term.

    (b) To calculate ISC for an academic term, begin by adding all credit hours of full-time Indian students and all credit hours of part-time Indian students, including full-time and part-time distance education Indian students, who are registered at the conclusion of the third week of the academic term.

    (c) Credit hours earned by Indian students who have not obtained a high school degree or its equivalent may be added if you have established criteria for the admission of such students on the basis of their ability to benefit from the education or training offered. You will be presumed to have established such criteria if your admission procedures include counseling or testing that measures students' aptitude to successfully complete the courses in which they enroll.

    (d) No credit hours earned by an Indian student attending high school and applied towards the student's high school degree or its equivalent may be counted toward computation of ISC; and no credit hours earned by an Indian student not making satisfactory progress toward a degree or certificate may count toward the ISC.

    (e) If ISC is being calculated for a fall term, add to the calculation in paragraph (b) of this section any credits earned in classes offered during the preceding summer term.

    (f) Add to the calculation in paragraph (b) of this section those credits being earned in an eligible continuing education program at the conclusion of the third week of the academic term. Determine the number of those credits as follows:

    (1) For institutions on a semester system: One credit for every 15 contact hours and

    (2) For institutions on a quarter system: One credit for every 10 contact hours of participation in an organized continuing education experience under responsible sponsorship, capable direction, and qualified instruction, as described in the criteria established by the International Association for Continuing Education and Training. Limit the number of calculated eligible continuing education credits to 10 percent of your ISC.

    (g) Divide by 12 the final calculation in paragraph (f) of this section. The formula for the full calculation is expressed mathematically as:

    ISC = (FTCR + PTCR + SCR + CECR)/12

    (h) In the formula in paragraph (g) of this section, the abbreviations used have the following meanings:

    (1) FTCR = the number of credit hours carried by full-time Indian students (students carrying 12 or more credit hours at the end of the third week of each academic term); and

    (2) PTCR = the number of credit hours carried by part-time Indian students (students carrying fewer than 12 credit hours at the end of the third week of each academic term).

    (3) SCR = in a fall term, the number of credit hours earned during the preceding summer term.

    (4) CECR = the number of credit hours being earned in an eligible continuing education program at the conclusion of the third week of the academic term, in accordance with paragraph (f)(2) of this section.

    § 41.7 What happens if false information is submitted?

    Persons submitting or causing to be submitted any false information in connection with any application, report, or other document under this part may be subject to criminal prosecution under provisions such as sections 371 or 1001 of Title 18, U.S. Code.

    Subpart B—Tribal Colleges and Universities
    § 41.9 What is the purpose of this subpart?

    This subpart prescribes procedures for providing financial and technical assistance under the TCCUA for the operation and improvement of Tribal colleges and universities and advancement of educational opportunities for Indian students. This subpart does not apply to Diné College.

    § 41.11 Who is eligible for financial assistance under this subpart?

    (a) A Tribal college or university is eligible for financial assistance under this subpart only if it:

    (1) Is governed by a board of directors or board of trustees, a majority of whom are Indians;

    (2) Demonstrates adherence to stated goals, a philosophy, or a plan of operation directed to meet the needs of Indians;

    (3) Has a student body that is more than 50 percent Indian (unless it has been in operation for less than one year);

    (4) Is either:

    (i) Accredited by a nationally recognized accrediting agency or association determined by the Secretary of Education to be a reliable authority with regard to the quality of training offered; or

    (ii) Is making reasonable progress toward accreditation according to such agency or association;

    (5) Has received a positive determination after completion of an eligibility study; and

    (6) Complies with the requirements of § 41.19.

    (b) Priority in grants is given to institutions that were in operation on October 17, 1978, and that have a history of service to Indian people.

    § 41.13 For what activities can financial assistance to Tribal colleges and universities be used?

    Tribal colleges and universities may use financial assistance under this subpart to defray expenditures for academic, educational, and administrative purposes and for the operation and maintenance of the college or university.

    § 41.15 What activities are prohibited?

    Tribal colleges and universities must not use financial assistance awarded under this subpart in connection with religious worship or sectarian instruction. However, nothing in this subpart will be construed as barring instruction or practice in comparative religions or cultures or in languages of Indian Tribes.

    § 41.17 What is the role of the Secretary of Education?

    (a) The Secretary may enter into an agreement with the Secretary of Education to obtain assistance to:

    (1) Develop plans, procedures, and criteria for eligibility studies required under this subpart; and

    (2) Conduct such studies.

    (b) BIE must consult with the Secretary of Education to determine the reasonable number of students required to support a Tribal college or university.

    § 41.19 How can a Tribal college or university establish eligibility to receive a grant?

    (a) Before a Tribal college or university can apply for an initial grant under this part, the governing body of one or more Indian Tribes must request a determination of eligibility on the college's or university's behalf.

    (b) Within 30 days of receiving a resolution or other duly authorized request from the governing body of one or more Indian Tribes, BIE will initiate an eligibility study to determine whether there is justification to encourage and maintain a Tribal college or university.

    (c) The eligibility study will analyze the following factors:

    (1) Financial feasibility based upon reasonable potential enrollment; considering:

    (i) Tribal, linguistics, or cultural differences;

    (ii) Isolation;

    (iii) Presence of alternate educational sources;

    (iv) Proposed curriculum;

    (2) Levels of Tribal matriculation in and graduation from postsecondary educational institutions; and

    (3) The benefits of continued and expanded educational opportunities for Indian students.

    (d) Based upon results of the study, the Director will send the Tribe a written determination of eligibility.

    (e) The Secretary and the BIE, to the extent practicable, will consult with national Indian organizations and with Tribal governments chartering the colleges or universities being considered.

    § 41.21 How can a Tribe appeal the results of an eligibility study?

    If a Tribe receives a negative determination under § 41.19(d), it may submit an appeal to the Assistant Secretary within 45 days.

    (a) Following the timely filing of a Tribe's notice of appeal, the Tribal college or university and the Tribe have a right to a formal review of the eligibility study, including a hearing upon reasonable notice within 60 days. At the hearing, the Tribal college or university and the appealing Tribe may present additional evidence or arguments to justify eligibility.

    (b) Within 45 days of the hearing, the Assistant Secretary will issue a written ruling confirming, modifying, or reversing the original determination. The ruling will be final and BIE will mail or deliver it within one week of its issuance.

    (c) If the Assistant Secretary does not reverse the original negative determination, the ruling will specify the grounds for the decision and state the manner in which the determination relates to each of the factors in § 41.11.

    § 41.23 Can a Tribal college or university request a second eligibility study?

    If a Tribe is not successful in its appeal under § 41.21, it can request another eligibility study 12 months or more after the date of the negative determination.

    § 41.25 How does a Tribal college or university apply for a grant?

    (a) If the Tribal college or university receives a positive determination of the eligibility study under § 41.19(d), it is entitled to apply for financial assistance under this subpart.

    (b) To be considered for assistance, a Tribal college or university must submit an application by or before June 1st of the year preceding the academic year for which the Tribal college or university is requesting assistance. The application must contain the following:

    Required information Required details (1) Identifying information (i) Name and address of the Tribal college or university.
  • (ii) Names of the governing board members, and the number of its members who are Indian.
  • (iii) Name and address of the Tribe or Tribes that control or have sanctioned or chartered the Tribal college or university.
  • (2) Eligibility verification The date on which an eligibility determination was received. (3) Curriculum materials (i) A statement of goals, philosophy, or plan of operation demonstrating how the education program is designed to meet the needs of Indians.
  • (ii) A curriculum, which may be in the form of a college catalog or similar publication, or information located on the Tribal college or university Web site.
  • (4) Financial information (i) A proposed budget showing total expected education program operating expenses and expected revenues from all sources for the academic year to which the information applies.
  • (ii) A description of record-keeping procedures used to track fund expenditures and to audit and monitor funded programs.
  • (5) Enrollment information (i) If the Tribal college or university has been in operation for more than one year, a statement of the total number of ISC (FTE Indian students) and the total number of all FTE students. Grantees may exclude high school students for the purpose of calculating the total number of FTE students.
  • (ii) If the Tribal college or university has not yet begun operations, or has been in operation for less than one year, a statement of expected enrollment, including the total number of FTE students and the ISC (FTE Indian students) and may also require verification of the number of registered students after operations have started.
  • (6) Assurances and requests (i) Assurance that the Tribal college or university will not deny admission to any Indian student because that student is, or is not, a member of a specific Tribe.
  • (ii) Assurance that the Tribal college or university will comply with the requirements in § 41.39 of this subpart.
  • (iii) A request and justification for a specific waiver of any requirement of 25 CFR part 276 which a Tribal college or university believe to be inappropriate.
  • (7) Certification Certification by the chief executive that the information on the application is complete and correct.

    (c) Material submitted in a Tribal college's or university's initial successful grant application will be retained by the BIE. A Tribal college or university submitting a subsequent application for a grant, must either confirm the information previously submitted remains accurate or submit updated information, as necessary.

    § 41.27 When can the Tribal college or university expect a decision on its application?

    Within 45 days of receiving an application, the Director will notify the Tribal college or university in writing whether or not the application has been approved.

    (a) If the Director approves the application, written notice will explain when the BIE will send the Tribal college or university a grant agreement under § 41.19.

    (b) If the Director disapproves the application, written notice will include:

    (1) The reasons for disapproval; and

    (2) A statement advising the Tribal college or university of the right to amend or supplement the Tribal college's or university's application within 45 days.

    (c) The Tribal college or university may appeal a disapproval or a failure to act within 45 days of receipt following the procedures in § 41.21.

    § 41.29 How will a grant be awarded?

    If the Director approves the Tribal college's or university's application, the BIE will send the Tribal college or university a grant agreement that incorporates the Tribal college's or university's application and the provisions required by § 41.25. The Tribal college or university grant will be for the fiscal year starting after the approval date of the application.

    (a) The BIE will generally calculate the amount of the Tribal college or university grant using the following procedure:

    (1) Begin with a base amount of $8,000 (adjusted annually for inflation);

    (2) Multiply the base amount by the number of FTE Indian students in attendance during each academic term; and

    (3) Divide the resulting sum by the number of academic terms in the academic year.

    (b) All grants under this section are subject to availability of appropriations.

    (c) If there are insufficient funds to pay the amount calculated under paragraph (a) of this section, BIE will reduce the grant amount awarded to each eligible Tribal college or university on a pro rata basis.

    § 41.31 When will the Tribal college or university receive funding?

    (a) BIE will authorize payments equal to 95 percent of funds available for allotment by either July 1 or within 14 days after appropriations become available, with the remainder of the payment made no later than September 30.

    (b) BIE will not commingle funds appropriated for grants under this subpart with other funds expended by the BIE.

    § 41.33 What if there isn't enough money to pay the full grant amount?

    This section applies if BIE has to reduce payments under § 41.29(c).

    (a) If additional funds have not been appropriated to pay the full amount of grants under this part on or before June 1st of the year, the BIE will notify all grant recipients in writing. The Tribal college or university must submit a written report to the BIE on or before July 1st explaining how much of the grant money remains unspent.

    (b) After receiving the Tribal college's or university's report under paragraph (a) of this section, BIE will:

    (1) Reallocate the unspent funds using the formula in § 41.29 in proportion to the amount of assistance to which each grant recipient is entitled but has not received;

    (2) Ensure that no Tribal college or university will receive more than the total annual cost of its education programs;

    (3) Collect unspent funds as necessary for redistribution to other grantees under this section; and

    (4) Make reallocation payments on or before August 1st of the academic year.

    § 41.35 What will happen if the Tribal college or university doesn't receive its appropriate share?

    (a) If the BIE determines the Tribal college or university has received financial assistance to which the Tribal college or university was not entitled, BIE will:

    (1) Promptly notify the Tribal college or university; and

    (2) Reduce the amount of the Tribal college's or university's payments under this subpart to compensate for any overpayments or otherwise attempt to recover the overpayments.

    (b) If a Tribal college or university has received less financial assistance than the amount to which the Tribal college or university was entitled, the Tribal college or university should promptly notify the BIE. If the BIE confirms the miscalculation, BIE will adjust the amount of the Tribal college's or university's payments for the same or subsequent academic years to compensate for the underpayments. This adjustment will come from the Department's general funds and not from future appropriated funds.

    § 41.37 Is the Tribal college or university eligible for other grants?

    Yes. Eligibility for grants under this subpart does not bar a Tribal college or university from receiving financial assistance under any other Federal program.

    § 41.39 What reports does the Tribal college or university need to provide?

    (a) The Tribal college or university must provide the BIE, on or before December 1 of each year, a report that includes:

    (1) An accounting of the amounts and purposes for which the Tribal college or university spent assistance received under this part during the preceding academic year;

    (2) An accounting of the annual cost of the Tribal college's or university's education programs from all sources for the academic year; and

    (3) A final performance report based upon the criteria the Tribal college's or university's goals, philosophy, or plan of operation.

    (b) The Tribal college or university must report to the BIE their FTE Indian student enrollment for each academic term of the academic year within three (3) weeks of the date the Tribal college or university makes the FTE calculation.

    § 41.41 Can the Tribal college or university receive technical assistance?

    (a) If a Tribal college or university sends the BIE a written request for technical assistance, BIE will respond within 30 days.

    (b) The BIE will provide technical assistance either directly or through annual contract to a national Indian organization that the Tribal college or university designates.

    (c) Technical assistance may include consulting services for developing programs, plans, and eligibility studies and accounting, and other services or technical advice.

    § 41.43 How must the Tribal college or university administer its grant?

    In administering any grant provided under this subpart, a Tribal college or university must:

    (a) Provide services or assistance under this subpart in a fair and uniform manner;

    (b) Not deny admission to any Indian student because they either are, or are not, a member of a specific Indian Tribe; and

    (c) Comply with part 276 of this chapter, unless the BIE expressly waives specific inappropriate provisions of part 276 in response to a Tribal college or university request and justification for a waiver.

    § 41.45 How does the Tribal college or university apply for programming grants?

    (a) Tribes and Tribal entities may submit a written request to the BIE for a grant to conduct planning activities for the purpose of developing proposals for the establishment of Tribally controlled colleges and universities, or to determine the need and potential for the establishment of such colleges and universities. BIE will provide written notice to the Tribal college or university of its determination on the grant request within 30 days.

    (b) Subject to the availability of appropriations, BIE may provide such grants to up to five Tribes and Tribal entities in the amount of $15,000 each.

    § 41.47 Are Tribal colleges or universities eligible for endowments?

    Yes. Tribal colleges and universities are eligible for endowments under a signed agreement between the Tribal college and university and the Secretary as described in 25 U.S.C. 1832. Endowments must be invested in a trust fund and the Tribal college or university may only use the interest deposited for the purpose of defraying expenses associated with the operation of the Tribal college or university (25 U.S.C. 1833).

    Subpart C—Diné College
    § 41.49 What is the purpose of this subpart?

    The purpose of this subpart is to assist the Navajo Nation in providing education to the members of the Tribe and other qualified applicants through a community college, established by that Tribe, known as Diné College. To that end, the regulations in this subpart prescribe procedures for providing financial and technical assistance for Diné College under the NCCA.

    § 41.51 What is the scope of this subpart?

    The regulations in this subpart are applicable to the provision of financial assistance to Diné College pursuant to NCCA, title II of the TCCUA.

    § 41.53 How does Diné College request financial assistance?

    To request financial assistance, Diné College must submit an application. The application must be certified by the Diné College chief executive officer and include:

    (a) A statement of Indian student enrollment and total FTE enrollment for the preceding academic year;

    (b) A curriculum description, which may be in the form of a college catalog or like publication or information located on the Diné College Web site; and

    (c) A proposed budget showing total expected operating expenses of educational programs and expected revenue from all sources for the grant year.

    § 41.55 How are grant funds processed?

    (a) BIE will identify the budget request for Diné College separately in its annual budget justification.

    (b) BIE will not commingle funds appropriated for grants under this subpart with appropriations that are historically expended by the Bureau of Indian Affairs for programs and projects normally provided on the Navajo Reservation for Navajo beneficiaries.

    § 41.57 When will the application be reviewed?

    Within 45 days of receiving the application the BIE will send a grant agreement for signature by the Diné College president or his or her designee in an amount determined under § 41.29(a). The grant agreement will incorporate the grant application and include the provisions required by § 41.25.

    § 41.59 When will grant funds be paid?

    (a) Initial grant funds will be paid in an advance installment of not less than 40 percent of the funds available for allotment by October 1st.

    (b) The remainder of the grant funds will be paid by July 1st after the BIE adjusts the amount to reflect any overpayments or underpayments made in the first disbursement.

    § 41.61 Is Diné College eligible to receive other grants?

    Yes. Eligibility for grants under this subpart does not bar Diné College from receiving financial assistance under any other Federal program.

    § 41.63 How can financial assistance be used?

    (a) The Diné College must use financial assistance under this subpart only for operation and maintenance, including educations programs, annual capital expenditures, major capital improvements, mandatory payments, supplemental student services, and improvement and expansion, as described in 25 U.S.C. 640c-1(b)(1);

    (b) The Diné College must not use financial assistance under this subpart for religious worship or sectarian instruction. However, this subpart does not prohibit instruction about religions, cultures or Indian Tribal languages.

    § 41.65 What reports must be provided?

    (a) Diné College must submit on or before December 1st of each year a report that includes:

    (1) An accounting of the amounts and purposes for which Diné College spent the financial assistance during the preceding academic year;

    (2) The annual cost of Diné College education programs from all sources for the academic year; and

    (3) A final report of Diné College's performance based upon the criteria in its stated goals, philosophy, or plan of operation.

    (b) Diné College must report its FTE Indian student enrollment for each academic term within six weeks of the date it makes the FTE calculation.

    § 41.67 Can Diné College receive technical assistance?

    Technical assistance will be provided to Diné College as noted in § 41.41.

    § 41.69 How must Diné College administer its grant?

    In administering any grant provided under this subpart, Diné College must:

    (a) Provide all services or assistance under this subpart in a fair and uniform manner;

    (b) Not deny admission to any Indian student because the student is, or is not, a member of a specific Indian Tribe; and

    (c) Comply with part 276 of this chapter, unless the BIE expressly waives specific inappropriate provisions of part 276 in response to Diné College's request and its justification for a waiver.

    § 41.71 Can Diné College appeal an adverse decision under a grant agreement by the Director?

    Diné College has the right to appeal to the Assistant Secretary by filing a written notice of appeal within 45 days of the adverse decision. Within 45 days after receiving notice of appeal, the Assistant Secretary will conduct a formal hearing at which time the Diné College may present evidence and argument to support its appeal. Within 45 days of the hearing, the Assistant Secretary will issue a written ruling on the appeal confirming, modifying or reversing the decision of the Director. If the ruling does not reverse the adverse decision, the Assistant Secretary will state in detail the basis of his/her ruling. The ruling of the Assistant Secretary on an appeal will be final for the Department.

    Dated: May 26, 2016. Lawrence S. Roberts, Acting Assistant Secretary—Indian Affairs.
    [FR Doc. 2016-14094 Filed 6-13-16; 8:45 am] BILLING CODE 4337-15-P
    DEPARTMENT OF HOMELAND SECURITY Coast Guard 33 CFR Parts 3, 100, and 165 [Docket Number USCG-2016-0060] Renaming of Sector Baltimore as Sector Maryland-National Capital Region; Conforming Amendments AGENCY:

    Coast Guard, DHS.

    ACTION:

    Final rule.

    SUMMARY:

    The Coast Guard is amending the Code of Federal Regulations (CFR) to reflect its renaming of Coast Guard Sector Baltimore as Coast Guard Sector Maryland-National Capital Region. These conforming amendments are necessary to ensure the CFR accurately reflects the new command name changes that were approved September 17, 2015. These amendments are not expected to have a substantive impact on the public.

    DATES:

    This rule is effective June 14, 2016.

    ADDRESSES:

    To view documents mentioned in this preamble as being available in the docket, go to http://www.regulations.gov, type USCG-2016-0060 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 Dennis Sens, Fifth Coast Guard District, Prevention Division, telephone 757-398-6204, 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 OFCO Operating Facility Change Order §  Section U.S.C. United States Code II. Background Information and Regulatory History

    On September 17, 2015, the Coast Guard approved renaming Sector Baltimore as Sector Maryland-National Capital Region. The Coast Guard is renaming the Sector to more clearly identify the unit's missions and area of responsibility to the public.

    We did not publish a notice of proposed rulemaking (NPRM) before this final rule. The Coast Guard finds that this rule is exempt from notice and comment rulemaking requirements under 5 U.S.C. 553(a)(2) and (b)(A) because the changes it makes are conforming amendments involving agency management and organization. The Coast Guard also finds good cause exists under 5 U.S.C. 553(b)(B) for not publishing an NPRM because the changes will have no substantive effect on the public, and notice and comment are therefore unnecessary. For the same reasons, the Coast Guard finds good cause under 5 U.S.C. 553(d)(3) to make the rule effective fewer than 30 days after publication in the Federal Register.

    III. Legal Authority and Need for Rule

    The Coast Guard is issuing this rule under authority in 14 U.S.C. 93. The purpose of this rule is to more clearly identify the functions and area of responsibility of this Coast Guard unit to the public. The Sector's location and boundaries are described in 33 CFR 3.25-15. The previous organization of Sector Baltimore is described and reflected in regulations, which also contain contact details and other references to Sector Baltimore. These conforming amendments update those regulations so that they contain current information under unit name Sector Maryland-National Capital Region.

    IV. Discussion of the Rule

    This rule amends existing regulations in 33 CFR to reflect the renaming of Sector Baltimore as “Sector Maryland-National Capital Region.” It also removes a temporary section that mentions Sector Baltimore, § 165.T05-0767, which we intended to be a rule lasting 6 hours that was to expire in 2013 but which still appears in the CFR. There will be no relocation of units, operational assets or personnel due to the renaming of Sector Baltimore. Sector Maryland-National Capital Region will retain Captain of the Port, Federal Maritime Security Coordinator, Officer in Charge Marine Inspection, Federal on Scene Coordinator, and all other authorities, responsibilities and sub-units, as previously assigned to Sector Baltimore. Only the title of these officials will change to reflect the new name of the sector. See Operating Facility Change Order (OFCO) No. 007-16 which is available in the docket for this rule.

    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.

    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. Because this rule involves internal agency organization and non-substantive changes, it will not impose any costs on the public.

    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. This rule does not require a general NPRM and therefore is exempt from the requirements of the Regulatory Flexibility Act. Although this rule is exempt, we have considered its potential impact on small entities and found that it will not have a significant economic impact on a substantial number of small entities.

    Under section 213(a) of the Small Business Regulatory Enforcement Fairness Act of 1996 (Public Law 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 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 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 internal administrative action involving the renaming a Coast Guard unit. It is categorically excluded from further review under paragraph 34(b) of Figure 2-1 of the Commandant Instruction.

    List of Subjects 33 CFR Part 3

    Organization and functions (Government agencies).

    33 CFR Part 100

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

    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 parts 3, 100, and 165 as follows:

    PART 3—COAST GUARD AREAS, DISTRICTS, SECTORS, MARINE INSPECTION ZONES, AND CAPTAIN OF THE PORT ZONES 1. The authority citation for part 3 continues to read as follows: Authority:

    14 U.S.C. 92 & 93; Pub. L. 107-296, 116 Stat. 2135; Department of Homeland Security Delegation No. 0170.1, para. 2(23).

    § 3.25-15 [Amended]
    2. In § 3.25-15, in the section heading, remove the word “Baltimore” and add in its place the words “Maryland-National Capital Region” and in the text, remove the word “Baltimore's” in the first and second sentences and add in its place the words “Sector Maryland-National Capital Region's”.
    PART 100—SAFETY OF LIFE ON NAVIGABLE WATERS 3. The authority citation for part 100 continues to read as follows: Authority:

    33 U.S.C. 1233.

    § 100.501 [Amended]
    4. In § 100.501— a. In paragraph (d)(2), remove the words “Sector Baltimore” and add, in their place, the words “Sector Maryland-National Capital Region” and remove the words “Baltimore, Maryland” and add, in their place, the words “Maryland-National Capital Region”; and b. In the Table to § 100.501, in heading (b.), remove the word “Baltimore” and add, in its place, the words “Maryland-National Capital Region”.
    PART 165—REGULATED NAVIGATION AREAS AND LIMITED ACCESS AREAS 5. 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.

    § 165.T05-0767 [Removed]
    6. Remove § 165.T05-0767.
    § 165.500 [Amended]
    7. In § 165.500— a. In paragraph (b), remove the word “Baltimore” and add, in its place, the words “Maryland-National Capital Region”; and b. In paragraphs (c)(2), remove the words “Baltimore, Maryland”, and add, in their place, the words “Maryland-National Capital Region”.
    § 165.502 [Amended]
    8. In § 165.502, in paragraph (b)(1), remove the words “Baltimore, Maryland”, and add, in their place, the words “Maryland-National Capital Region”.
    § 165.505 [Amended]
    9. In § 165.505, in paragraph (b)(1), remove the words “Baltimore, Maryland”, and add, in their place, the words “Maryland-National Capital Region”.
    § 165.506 [Amended]
    10. In § 165.506— a. In paragraph (c)(2), remove the words “Sector Baltimore” and add, in their place, the words “Sector Maryland-National Capital Region” and remove the words “Baltimore, Maryland” and add, in their place, the words “Maryland-National Capital Region”; and
    b. In the Table to § 165.506, in heading (b.), remove the word “Baltimore” and add, in its place, the words “Maryland-National Capital Region”.
    § 165.507 [Amended]
    11. In § 165.507— a. In paragraph (a) remove the words “Baltimore, Maryland” wherever they appear, and add, in their places the words “Maryland-National Capital Region”; and b. In paragraphs (c)(2) and (3), remove the words “Baltimore, Maryland” wherever they appear, and add, in their places the words “Maryland-National Capital Region” and in paragraph (c)(3) remove the words “Baltimore to” and add, in their place, the words “Sector Maryland-National Capital Region”.
    § 165.508 [Amended]
    12. In § 165.508— a. In paragraph (a) remove paragraph designation (1) and remove the words “Baltimore, Maryland” wherever they appear, and add, in their places the words “Maryland-National Capital Region”; and b. In paragraphs (c)(2) and (3), remove the words “Baltimore, Maryland” wherever they appear, and add, in their places the words “Maryland-National Capital Region” and in paragraph (c)(3) remove the words “Baltimore to” and add, in their place, the words “Sector Maryland-National Capital Region”.
    § 165.509 [Amended]
    13. In § 165.509, in paragraphs (a) and (c)(2) and (3), remove the words “Baltimore, Maryland” wherever they appear, and add, in their places, the words “Maryland-National Capital Region”, and in paragraph (c)(3) remove the words “Baltimore to” and add, in their place the words “Sector Maryland-National Capital Region”.
    § 165.512 [Amended]
    14. In § 165.512— a. In paragraph (a)(1), remove the words “Baltimore, Maryland” wherever they appear, and add, in their places, the words “Maryland-National Capital Region”; and remove the words “Sector Baltimore” and add, in their place, the words “Sector Maryland-National Capital Region”; and
    b. In paragraphs (c)(2) and (3), remove the words “Baltimore, Maryland” wherever they appear, and add, in their places the words “Maryland-National Capital Region”.
    § 165.513 [Amended]
    15. In § 165.513— a. In paragraph (a) remove the words “Port Baltimore” wherever they appear, and add, in their places, the words “Port, Maryland-National Capital Region” and remove the words “Baltimore, Maryland” wherever they appear, and add, in their places the words “Maryland-National Capital Region”; and b. In paragraphs (c)(2)-(4), remove the words “Port Baltimore” wherever they appear, and add, in their places, the words “Port, Maryland-National Capital Region”.
    § 165.518 [Amended]
    16. In § 165.518, in paragraph (c)(7) remove the word “Baltimore” and add, in its place, the words “Maryland-National Capital Region”, and in paragraph (c)(3) remove the words “Baltimore to” and add, in their place, the words “Sector Maryland-National Capital Region”.
    Dated: June 8, 2016. Katia Kroutil, Chief, Office of Regulations and Administrative Law.
    [FR Doc. 2016-13983 Filed 6-13-16; 8:45 am] BILLING CODE 9110-04-P
    DEPARTMENT OF HOMELAND SECURITY Coast Guard 33 CFR Part 117 [Docket No. USCG-2016-0472] Drawbridge Operation Regulation; Middle River, Between Bacon Island and Lower Jones Tract, California AGENCY:

    Coast Guard, DHS.

    ACTION:

    Notice of temporary deviation from drawbridge regulation.

    SUMMARY:

    The Coast Guard has issued a temporary deviation from the operating schedule that governs the San Joaquin County (Bacon Island Road) highway bridge across Middle River, mile 8.6, at between Bacon Island and Lower Jones Tract, California. The deviation is necessary to allow the bridge owner to make emergency mechanical and electrical repairs. This deviation allows the bridge to be secured in the closed-to-navigation position during the deviation period.

    DATES:

    This deviation is effective without actual notice from June 14, 2016 until 11:59 p.m. on July 1, 2016. For the purposes of enforcement, actual notice will be used from June 8, 2016, until June 14, 2016.

    ADDRESSES:

    The docket for this deviation, [USCG-2016-0472], is available at http://www.regulations.gov. Type the docket number in the “SEARCH” box and click “SEARCH.” Click on Open Docket Folder on the line associated with this deviation.

    FOR FURTHER INFORMATION CONTACT:

    If you have questions on this temporary deviation, call or email David H. Sulouff, Chief, Bridge Section, Eleventh Coast Guard District; telephone 510-437-3516, email [email protected]

    SUPPLEMENTARY INFORMATION:

    San Joaquin County Department of Public Works has requested a temporary change to the operation of the San Joaquin County (Bacon Island Road) highway drawbridge, mile 8.6, over Middle River, between Bacon Island and Lower Jones Tract, California. The drawbridge navigation span provides approximately 8 feet vertical clearance above Mean High Water in the closed-to-navigation position. The draw operates as required by 33 CFR 117.171(a). Navigation on the waterway is commercial and recreational.

    The drawspan operating machinery failed unexpectedly on May 28, 2016 and the drawspan will remain secured in the closed-to-navigation position until 11:59 p.m. on July 1, 2016, to allow the bridge owner to make emergency repairs. This temporary deviation has been coordinated with the waterway users. No objections to the proposed temporary deviation were raised.

    Vessels able to pass through the bridge in the closed position may do so at anytime. The bridge will not be able to open for emergencies. Old River can be used as an alternate route for vessels unable to pass through the bridge in the closed position. The Coast Guard has also informed waterway users through our Local and Broadcast Notices to Mariners of the change in operating schedule for the bridge so that vessel operators can arrange their transits to minimize any impact caused by the temporary deviation.

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

    Dated: June 8, 2016. D.H. Sulouff, District Bridge Chief, Eleventh Coast Guard District.
    [FR Doc. 2016-13987 Filed 6-13-16; 8:45 am] BILLING CODE 9110-04-P
    DEPARTMENT OF HOMELAND SECURITY Coast Guard 33 CFR Part 165 [Docket Number USCG-2015-1029] RIN 1625-AA00 Safety Zones; Coast Guard Sector Ohio Valley Annual and Recurring Safety Zones Update AGENCY:

    Coast Guard, DHS.

    ACTION:

    Final rule.

    SUMMARY:

    The Coast Guard is amending and updating its safety zones relating to recurring fireworks shows and other events that take place in the Coast Guard Sector Ohio Valley area of responsibility (AOR). This rule informs the public of regularly scheduled events that require additional safety measures through the establishing of a safety zone. Through this rulemaking the current list of recurring safety zones is updated with revisions, additional events, and removal of events that no longer take place in Sector Ohio Valley's AOR. When these safety zones are enforced, certain restrictions are placed on marine traffic in specified areas.

    DATES:

    This rule is effective June 14, 2016.

    ADDRESSES:

    To view documents mentioned in this preamble as being available in the docket, go to http://www.regulations.gov, type USCG-2015-1029 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 on this proposed rule, call or email Petty Officer James Robinson, Sector Ohio Valley, U.S. Coast Guard; telephone (502) 779-5347, 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 Captain of the Port (COTP) Ohio Valley is establishing, amending, and updating its current list of recurring safety zones codified in Table 1 of 33 CFR 165.801, for the COTP Ohio Valley zone.

    On March 7, 2016, the Coast Guard published a notice of proposed rulemaking (NPRM) entitled, “Sector Ohio Valley Annual and Recurring Safety Zones Update” (81 FR 11706). The public comment period ended on June 6, 2016. Before the comment period closed, the Coast Guard received information regarding two of the events. For the event listed in Table 1, Line 21, the event sponsor provided a new location and for the event listed in Table 1, Line 56, the event sponsor requested that for 2016 the event be held on July 1 instead of July 4. See Section IV. for more information on these two events.

    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. Though we are not providing a full 30 day notice period, the Coast Guard is now providing less than 30 days notice before the first recurring event enforcement is required on July 2. It is impracticable to provide a full 30-days notice because this rule must be effective July 2, 2016.

    III. Legal Authority and Need for Rule

    The Coast Guard's authority for establishing a safety zone is contained at 33 U.S.C. 1231. The Coast Guard is amending and updating the safety zones under 33 CFR part 165 to include the most up to date list of recurring safety zones for events held on or around navigable waters within the Sector Ohio Valley AOR. These events include fireworks displays, air shows, and others. The current list in Table 1 of 33 CFR 165.801 requires amending to provide new information on existing safety zones, include new safety zones expected to recur annually or biannually, and to remove safety zones that are no longer required. Issuing individual regulations for each new safety zone, amendment, or removal of an existing safety zone creates unnecessary administrative costs and burdens. This rulemaking reduces administrative overhead and provides the public with notice through publication in the Federal Register of the upcoming recurring safety zones.

    IV. Discussion of Comments, Changes, and the Rule

    As noted above, we received information correcting the location for one recurring event and a date change for another from the event sponsors during the NPRM comment period. Therefore for 2016, we will be issuing a temporary final rule under Docket number 2016-0502 to establish a safety zone for the Riverfront Independence Festival Fireworks event, listed in Table 1, Line 21. The temporary final rule will be issued because for 2016, the event sponsor requested to change the location of the event from Ohio River, Mile 602.0-603.5 (Indiana) to Ohio River, Mile 607.5-608.6 (Indiana). If the event sponsor decides to continue to hold the event annually at the new location, the Coast Guard will publish an NPRM in the Federal Register to permanently change the event location.

    In addition for 2016, we will be issuing a temporary final rule under Docket number 2016-0279 to establish a safety zone for the Kindred Communications/Dawg Dazzle event, listed in Table 1, Line 56. The temporary final rule will reflect that for 2016 the event will be held on July 1 instead of July 4, which is the date listed in this final rule. If the event sponsor decides to continue to hold the event annually on July 1, the Coast Guard will publish an NPRM in the Federal Register to permanently change the event date.

    All other proposed amendments will be adopted without change from the NPRM.

    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.

    The Coast Guard expects the economic impact of this rule to be minimal, and therefore a full regulatory evaluation is unnecessary. This rule establishes safety zones limiting access to certain areas under 33 CFR 165 within Sector Ohio Valley's AOR. The effect of this rulemaking will not be significant because these safety zones are limited in scope and duration. Additionally, the public is given advance notification through local forms of notice, the Federal Register, and/or Notices of Enforcement and thus will be able to plan around the safety zones in advance. Deviation from the safety zones established through this proposed rulemaking may be requested from the appropriate COTP and requests will be considered on a case-by-case basis. Broadcast Notices to Mariners and Local Notices to Mariners will also inform the community of these safety zones so that they may plan accordingly for these short restrictions on transit. Vessel traffic may request permission from the COTP Ohio Valley or a designated representative to enter the restricted areas.

    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 0 comments from the Small Business Administration on this rulemaking. The Coast Guard certifies under 5 U.S.C. 605(b) that this rule will not have a significant economic impact on a substantial number of small entities.

    This rule will affect the following entities, some of which may be small entities: The owners or operators of vessels intending to transit the safety zone areas during periods of enforcement. The safety zones will not have a significant economic impact on a substantial number of small entities because they are limited in scope and will be in effect for short periods of time. Before the enforcement period, the Coast Guard COTP will issue maritime advisories widely available to waterway users. Deviation from the safety zones established through this rulemaking may be requested from the appropriate COTP and requests will be considered on a case-by-case basis.

    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 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 proposed rule is categorically excluded under section 2.B.2, figure 2-1, paragraph (34(g)) of the Instruction because it involves establishment of safety zones.

    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.

    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. Amend § 165.801 by revising table 1 to read as follows:
    § 165.801 Annual Fireworks displays and other events in Sector Ohio Valley's AOR. Date Sponsor/name Location Safety zone 1. Multiple days—April through November Pittsburgh Pirates/Pittsburgh Pirates Fireworks Pittsburgh, PA Allegheny River, Mile 0.2-0.8 (Pennsylvania). 2. Multiple days—April through November Cincinnati Reds/Cincinnati Reds Season Fireworks Cincinnati, OH Ohio River, Mile 470.1-470.4; extending 500 ft. from the State of Ohio shoreline (Ohio). 3. 2 days—Third Friday and Saturday in April Thunder Over Louisville/Thunder Over Louisville Louisville, KY Ohio River, Mile 602.0-606.0 (Kentucky). 4. Last Sunday in May Friends of Ironton Ironton, OH Ohio River, Mile 326.7-327.7 (Ohio). 5. 3 days—Third weekend in April Henderson Tri-Fest/Henderson Breakfast Lions Club Henderson, KY Ohio River, Mile 803.5-804.5 (Kentucky). 6. 1 day—A Saturday in July Paducah Parks and Recreation Department/Cross River Swim Paducah, KY Ohio River, Mile 934.0-936.0 (Kentucky). 7. 1 day—First weekend in June Bellaire All-American Days Bellaire, OH Ohio River, Mile 93.5-94.5 (Ohio). 8. 2 days—Second weekend of June Rice's Landing Riverfest Rices Landing, PA Monongahela River, Mile 68.0-68.8 (Pennsylvania). 9. 1 day—First Sunday in June West Virginia Symphony Orchestra/Symphony Sunday Charleston, WV Kanawha River, Mile 59.5-60.5 (West Virginia). 10. 1 day—Saturday before 4th of July Riverfest Inc./Saint Albans Riverfest St. Albans, WV Kanawha River, Mile 46.3-47.3 (West Virginia). 11. 1 day—4th July Greenup City Greenup, KY Ohio River, Mile 335.2-336.2 (Kentucky). 12. 1 day—4th July Middleport Community Association Middleport, OH Ohio River, Mile 251.5-252.5 (Ohio). 13. 1 day—4th July People for the Point Party in the Park South Point, OH Ohio River, Mile 317-318 (Ohio). 14. 1 day—Last weekend in June or first weekend in July Riverview Park Independence Festival Louisville, KY Ohio River, Mile 618.5-619.5 (Kentucky). 15. 1 day—Third or fourth week in July Upper Ohio Valley Italian Heritage Festival/Upper Ohio Valley Italian Heritage Festival Fireworks Wheeling, WV Ohio River, Mile 90.0-90.5 (West Virginia). 16. 1 day—4th or 5th of July City of Cape Girardeau July 4th Fireworks Show on the River Cape Girardeau, MO Upper Mississippi River, Mile 50.0-52.0. 17. 1 day—Third or fourth of July Harrah's Casino/Metropolis Fireworks Metropolis, IL Ohio River, Mile 942.0-945.0 (Illinois). 18. 1 day—During the first week of July Louisville Bats Baseball Club/Louisville Bats Firework Show Louisville, KY Ohio River, Mile 603.0-604.0 (Kentucky). 19. 1 day—July 4th Waterfront Independence Festival/Louisville Orchestra Waterfront 4th Louisville, KY Ohio River, Mile 603.0-604.0 (Kentucky). 20. 1 day—During the first week of July Celebration of the American Spirit Fireworks/All American 4th of July Owensboro, KY Ohio River, Mile 755.0-759.0 (Kentucky). 21. 1 day—During the first week of July Riverfront Independence Festival Fireworks New Albany, IN Ohio River, Mile 602.0-603.5 (Indiana). 22. 1 day—July 4th Shoals Radio Group/Spirit of Freedom Fireworks Florence, AL Tennessee River, Mile 255.0-257.0 (Alabama). 23. 1 day—Saturday before July 4th Town of Cumberland City/Lighting up the Cumberlands Fireworks Cumberland City, TN Cumberland River, Mile 103.0-105.0 (Tennessee). 24. 1 day—July 4th Knoxville office of Special Events/Knoxville July 4th Fireworks Knoxville, TN Tennessee River, Mile 647.0-648.0 (Tennessee). 25. 1 day—July 4th NCVC/Music City July 4th Nashville, TN Cumberland River, Mile 190.0-192.0 (Tennessee). 26. 1 day—Saturday before July 4th, or Saturday after July 4th Grand Harbor Marina/Grand Harbor Marina July 4th Celebration Counce, TN Tennessee-Tombigbee Waterway, Mile 450.0-450.5 (Tennessee). 27. 1 day—Second Saturday in July City of Bellevue, KY/Bellevue Beach Park Concert Fireworks Bellevue, KY Ohio River, Mile 468.2-469.2 (Kentucky and Ohio). 28. 1 day—Sunday before Labor Day Cincinnati Bell, WEBN, and Proctor and Gamble/Riverfest Cincinnati, OH Ohio River, Mile 469.2-470.5 (Kentucky and Ohio). 29. 1 day—July 4th Summer Motions Inc./Summer Motion Ashland, KY Ohio River, Mile 322.1-323.1 (Kentucky). 30. 1 day—Last weekend in June or First weekend in July City of Point Pleasant/Point Pleasant Sternwheel Fireworks Point Pleasant, WV Ohio River, Mile 265.2-266.2 (West Virginia). 31. 1 day—July 3rd or 4th City of Charleston/City of Charleston Independence Day Celebration Charleston, WV Kanawha River, Mile 58.1-59.1 (West Virginia). 32. 1 day—July 4th Civic Forum/Civic Forum 4th of July Celebration Portsmouth, OH Ohio River, Mile 355.5-356.5 (Ohio). 33. 1 day—Second Saturday in August Guyasuta Days Festival/Borough of Sharpsburg Pittsburgh, PA Allegheny River, Mile 005.5-006.0 (Pennsylvania). 34. 1 day—Third week in October Pittsburgh Foundation/Bob O'Connor Cookie Cruise Pittsburgh, PA Ohio River, Mile 0.0-0.5 (Pennsylvania). 35. 1 day—Second full week of August PA FOB Fireworks Display Pittsburgh, PA Allegheny River, Mile 0.8-1.0 (Pennsylvania). 36. 1 day—Third week of August Beaver River Regatta Fireworks Beaver, PA Ohio River, Mile 25.2-25.8 (Pennsylvania). 37. 1 day—December 31 Pittsburgh Cultural Trust/Highmark First Night Pittsburgh Pittsburgh, PA Allegheny River Mile, 0.5-1.0 (Pennsylvania). 38. 1 day—Friday before Thanksgiving Pittsburgh Downtown Partnership/Light Up Night Pittsburgh, PA Allegheny River, Mile 0.0-1.0 (Pennsylvania). 39. Multiple days—April through November Pittsburgh Riverhounds/Riverhounds Fireworks Pittsburgh, PA Monongahela River, Mile 0.22-0.77 (Pennsylvania). 40. 3 days—Second or third weekend in June Hadi Shrine/Evansville Freedom Festival Air Show Evansville, IN Ohio River, Miles 791.0-795.0 (Indiana). 41. 1 day—Second or third Saturday in June, the last day of the Riverbend Festival Friends of the Festival, Inc./Riverbend Festival Fireworks Chattanooga, TN Tennessee River, Mile 463.5-464.5 (Tennessee). 42. 2 days—Second Friday and Saturday in June City of Newport, KY/Italianfest Newport, KY Ohio River, Miles 469.6-470.0 (Kentucky and Ohio). 43. 1 day—Last Saturday in June City of Aurora/Aurora Firecracker Festival Aurora, IN Ohio River Mile, 496.7; 1400 ft. radius from the Consolidated Grain Dock located along the State of Indiana shoreline at (Indiana and Kentucky). 44. 1 day—second weekend in June City of St. Albans/St. Albans Town Fair St. Albans, WV Kanawha River, Mile 46.3-47.3 (West Virginia). 45. 1 day—Saturday before July 4th PUSH Beaver County/Beaver County Boom Beaver, PA Ohio River, Mile 24.0-25.6 (Pennsylvania). 46. 1 day—4th of July (Rain date—July 5th) Monongahela Area Chamber of Commerce/Monongahela 4th of July Celebration Monongahela, PA Monongahela River, Mile 032.0-033.0 (Pennsylvania). 47. 1 day—Saturday Third or Fourth full week of July (Rain date—following Sunday) Oakmont Yacht Club/Oakmont Yacht Club Fireworks Oakmont, PA Allegheny River, Mile 12.0-12.5 (Pennsylvania). 48. 1 day—Week of July 4th Three Rivers Regatta Fireworks/EQT 4th of July Celebration Pittsburgh, PA Ohio River, Mile 0.0-0.5, Allegheny River, Mile 0.0-0.5, and Monongahela River, Mile 0.0-0.5 (Pennsylvania). 49. 1 day—3rd or 4th of July City of Paducah, KY Paducah, KY Ohio River, Mile 934.0-936.0; Tennessee River, mile 0.0-1.0 (Kentucky). 50. 1 day—3rd or 4th of July City of Hickman, KY Hickman, KY Lower Mississippi River, Mile 921.0-923.0 (Kentucky). 51. 1 day—During the first week of July Evansville Freedom Celebration Evansville, IN Ohio River, Miles 791.0-795.0 (Indiana). 52. 3 days—One of the first two weekends in July Madison Regatta, Inc./Madison Regatta Madison, IN Ohio River, Miles 555.0-560.0 (Indiana). 53. 1 day—July 4th Cities of Cincinnati, OH and Newport, KY/July 4th Fireworks Newport, KY Ohio River, Miles 469.6-470.2 (Kentucky and Ohio). 54. 2 days—second weekend in July Marietta Riverfront Roar/Marietta Riverfront Roar Marietta, OH Ohio River, Mile 171.6-172.6 (Ohio). 55. 1 day—1st weekend in July Gallia County Chamber of Commerce/Gallipolis River Recreation Festival Gallipolis, OH Ohio River, Mile 269.5-270.5 (Ohio). 56. 1 day—July 4th Kindred Communications/Dawg Dazzle Huntington, WV Ohio River, Mile 307.8-308.8 (West Virginia). 57. 1 day—Last weekend in August Swiss Wine Festival/Swiss Wine Festival Fireworks Show Ghent, KY Ohio River, Mile 537 (Kentucky). 58. 1 day—Saturday of Labor Day weekend University of Pittsburgh Athletic Department/University of Pittsburgh Fireworks Pittsburgh, PA Allegheny River, Mile 0.0-0.25 (Pennsylvania). 59. Sunday, Monday, or Thursday from September through January Pittsburgh Steelers Fireworks Pittsburgh, PA Ohio River, Mile 0.3-Allegheny River, Mile 0.2 (Pennsylvania). 60. 3 days—Third weekend in September Wheeling Heritage Port Sternwheel Festival Foundation/Wheeling Heritage Port Sternwheel Festival Wheeling, WV Ohio River, Mile 90.2-90.7 (West Virginia). 61. 1 day—Second Saturday in September Ohio River Sternwheel Festival Committee fireworks Marietta, OH Ohio River, Mile 171.5-172.5 (Ohio). 62. 1 day—Second weekend of October Leukemia and Lymphoma Society/Light the Night Walk Fireworks Nashville, TN Cumberland River, Mile 190.0-192.0 (Tennessee). 63. 1 day—First Saturday in October West Virginia Motor Car Festival Charleston, WV Kanawha River, Mile 58-59 (West Virginia). 64. 1 day—Friday before Thanksgiving Kittanning Light Up Night Firework Display Kittanning, PA Allegheny River, Mile 44.5-45.5 (Pennsylvania). 65. 1 day—First week in October Leukemia & Lymphoma Society/Light the Night Pittsburgh, PA Ohio River, Mile 0.0-0.4 (Pennsylvania). 66. 1 day—Friday before Thanksgiving Duquesne Light/Santa Spectacular Pittsburgh, PA Monongahela River, Mile 0.00-0.22, Allegheny River, Mile 0.00-0.25, and Ohio River, Mile 0.0-0.3 (Pennsylvania).
    Dated: June 9, 2016. R.V. Timme, Captain, U.S. Coast Guard, Captain of the Port Ohio Valley.
    [FR Doc. 2016-14030 Filed 6-13-16; 8:45 am] BILLING CODE 9110-04-P
    DEPARTMENT OF HOMELAND SECURITY Coast Guard 33 CFR Part 165 [Docket Number USCG-2016-0389] RIN 1625-AA00 Safety Zone; Ohio River Mile 43.2 to Mile 43.6, East Liverpool, OH AGENCY:

    Coast Guard, DHS.

    ACTION:

    Temporary final rule.

    SUMMARY:

    The Coast Guard is establishing a temporary safety zone for navigable waters of the Ohio River from mile 43.2 to mile 43.6. The safety zone is needed to protect personnel, vessels, and the marine environment from potential hazards created from a barge-based fireworks display. Entry of vessels or persons into this zone is prohibited unless specifically authorized by the Captain of the Port Pittsburgh.

    DATES:

    This rule is effective on July 2, 2016, from 9 p.m. until 10:30 p.m.

    ADDRESSES:

    To view documents mentioned in this preamble as being available in the docket, go to http://www.regulations.gov, type USCG-2016-0389 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 on this rule, call or email MST1 Jennifer Haggins, Marine Safety Unit Pittsburgh, U.S. Coast Guard, at telephone 412-221-0807, 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 the Coast Guard received notice on April 26, 2016 that this fireworks display would take place. After receiving and fully reviewing the event information, circumstances, and exact location, the Coast Guard determined that a safety zone is necessary to protect personnel, vessels, and the marine environment from potential hazards created from a barge-based fireworks display on the navigable waterway. It would be impracticable to complete the full NPRM process for this safety zone because it needs to be established by July 2, 2016. The fireworks display has been advertised and the local community has prepared for the event.

    Under 5 U.S.C. 553(d)(3), the Coast Guard finds that good cause exists for making this rule effective less than 30 days after publication in the Federal Register. For these same reasons, the Coast Guard finds good cause for implementing this rule less than thirty days before the effective date of the rule.

    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 Pittsburgh (COTP) has determined that a safety zone is needed on July 2, 2016. This rule is needed to protect personnel, vessels, and the marine environment from potential hazards created from a barge-based fireworks display.

    IV. Discussion of the Rule

    This rule establishes a safety zone on July 2, 2016 from 10:00 p.m. until 11:30 p.m. The safety zone will cover all navigable waters on the Ohio River from mile 43.2 to mile 43.6. The duration of the safety zone is intended to protect personnel, vessels, and the marine environment from potential hazards created from a barge-based firework display. No vessel or person will be permitted to enter the safety zone 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 of the safety zone. This safety zone impacts a small portion of the waterway and for a limited duration of less than two hours. Vessel traffic will be informed about the safety zone through local notices to mariners. Moreover, the Coast Guard will issue Broadcast Notices to Mariners via VHF-FM marine channel 16 about the zone and the rule allows vessels to seek permission to transit 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 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 safety zone lasting less than two hours that will prohibit entry on the Ohio River between mile 43.2 and mile 43.6, during the barge-based firework event. It is categorically excluded from further review under paragraph 34 (g) of Figure 2-1 of the Commandant Instruction. An environmental analysis checklist supporting this determination and a Categorical Exclusion Determination are available in the docket where indicated under ADDRESSES. We seek any comments or information that may lead to the discovery of a significant environmental impact from this rule.

    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

    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.T08-0389 to read as follows:
    § 165.T08-0389 Safety Zone, Ohio River, East Liverpool, OH.

    (a) Location. The following area is a safety zone: Ohio River mile 43.2 to mile 43.6.

    (b) Enforcement. This rule will be enforced, from 10:00 p.m. until 11:30 p.m. on July 2, 2016.

    (c) Regulations. (1) In accordance with the general regulations in § 165.23 of this part, entry into this zone is prohibited unless authorized by the Captain of the Port Pittsburgh or a designated representative.

    (2) Persons or vessels requiring entry into or passage through the zone must request permission from the Captain of the Port Pittsburgh or a designated representative. The Captain of the Pittsburgh representative may be contacted at 412-221-0807.

    (3) All persons and vessels shall comply with the instructions of the Captain of the Port Pittsburgh or their designated representative. Designated Captain of the Port representatives include United States Coast Guard commissioned, warrant, and petty officers.

    (d) Information broadcasts. The Captain of the Port Pittsburgh or a designated representative will inform the public through broadcast notices to mariners of the enforcement period for the safety zone as well as any changes in the planned schedule.

    Dated: May 27, 2016. L. McClain, Jr., Commander, U.S. Coast Guard, Acting Captain of the Port Pittsburgh.
    [FR Doc. 2016-14027 Filed 6-13-16; 8:45 am] BILLING CODE 9110-04-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 180 [EPA-HQ-OPP-2013-0235; FRL-9946-75] Chlorantraniliprole; Pesticide Tolerances AGENCY:

    Environmental Protection Agency (EPA).

    ACTION:

    Final rule.

    SUMMARY:

    This regulation establishes tolerances for residues of chlorantraniliprole in or on multiple commodities which are identified and discussed later in this document. Interregional Research Project Number 4 (IR-4) requested the tolerances associated with pesticide petition number (PP) 5E8371, under the Federal Food, Drug, and Cosmetic Act (FFDCA). Additionally, the Agency is amending the existing tolerance for egg that was inadvertently omitted in a previous action.

    DATES:

    This regulation is effective June 14, 2016. Objections and requests for hearings must be received on or before August 15, 2016, and must be filed in accordance with the instructions provided in 40 CFR part 178 (see also Unit I.C. of the SUPPLEMENTARY INFORMATION).

    ADDRESSES:

    The docket for this action, identified by docket identification (ID) number EPA-HQ-OPP-2013-0235, is available at http://www.regulations.gov or at the Office of Pesticide Programs Regulatory Public Docket (OPP Docket) in the Environmental Protection Agency Docket Center (EPA/DC), West William Jefferson Clinton Bldg., Rm. 3334, 1301 Constitution Ave. NW., Washington, DC 20460-0001. The Public Reading Room is open from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding legal holidays. The telephone number for the Public Reading Room is (202) 566-1744, and the telephone number for the OPP Docket is (703) 305-5805. Please review the visitor instructions and additional information about the docket available at http://www.epa.gov/dockets.

    FOR FURTHER INFORMATION CONTACT:

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

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

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

    • Crop production (NAICS code 111).

    • Animal production (NAICS code 112).

    • Food manufacturing (NAICS code 311).

    • Pesticide manufacturing (NAICS code 32532).

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

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

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

    Under FFDCA section 408(g), 21 U.S.C. 346a, any person may file an objection to any aspect of this regulation and may also request a hearing on those objections. You must file your objection or request a hearing on this regulation in accordance with the instructions provided in 40 CFR part 178. To ensure proper receipt by EPA, you must identify docket ID number EPA-HQ-OPP-2013-0235 in the subject line on the first page of your submission. All objections and requests for a hearing must be in writing, and must be received by the Hearing Clerk on or before August 15, 2016. Addresses for mail and hand delivery of objections and hearing requests are provided in 40 CFR 178.25(b).

    In addition to filing an objection or hearing request with the Hearing Clerk as described in 40 CFR part 178, please submit a copy of the filing (excluding any Confidential Business Information (CBI)) for inclusion in the public docket. Information not marked confidential pursuant to 40 CFR part 2 may be disclosed publicly by EPA without prior notice. Submit the non-CBI copy of your objection or hearing request, identified by docket ID number EPA-HQ-OPP-2013-0235, by one of the following methods:

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

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

    Hand Delivery: To make special arrangements for hand delivery or delivery of boxed information, please follow the instructions at http://www.epa.gov/dockets/contacts.html. Additional instructions on commenting or visiting the docket, along with more information about dockets generally, is available at http://www.epa.gov/dockets.

    II. Summary of Petitioned-For Tolerance

    In the Federal Register of August 26, 2015 (80 FR 51759) (FRL-9931-74), EPA issued a document pursuant to FFDCA section 408(d)(3), 21 U.S.C. 346a(d)(3), announcing the filing of a pesticide petition (PP) 5E8371 by Interregional Research Project Number 4 (IR-4), 500 College Road East, Princeton, NJ 08540. The petition requested that 40 CFR part 180 be amended by establishing tolerances for residues of the insecticide chlorantraniliprole, 3-bromo-N-[4-chloro-2-methyl-6-[(methylamino)-carbonyl]phenyl]-1-(3-chloro-2-pyridinyl)-1H-pyrazole-5-carboxamide, in or on nut, tree, group 14-12 at 0.02 parts per million (ppm); and fruit, stone, group 12-12 at 2.5 ppm. This petition additionally requested that 40 CFR 180.628 be amended by revising the existing tolerance in or on artichoke, globe from 4.0 ppm to 2.0 ppm; and hop, dried cones from 90 ppm to 40 ppm. Upon establishment of the tolerances associated with (PP) 5E8371, IR-4 requests to remove the following existing tolerances in 40 CFR 180.628: Nut, tree, group 14 at 0.04 ppm; pistachio at 0.04 ppm; fruit, stone, group 12-12, except cherry, chickasaw plum, and damson plum at 4.0 ppm; cherry, sweet at 2.0 ppm; cherry, tart at 2.0 ppm; plum, chickasaw at 2.0 ppm; and plum, damson at 2.0 ppm. That document referenced a summary of the petition prepared on behalf of IR-4 by DuPont Crop Protection, the registrant, which is available in the docket EPA-HQ-OPP-2013-0235 at http://www.regulations.gov.

    There were no comments received in response to the notice of filing.

    III. Aggregate Risk Assessment and Determination of Safety

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

    Consistent with FFDCA section 408(b)(2)(D), EPA has reviewed the available scientific data and other relevant information in support of this action. EPA has sufficient data to assess the hazards of and to make a determination on aggregate exposure for chlorantraniliprole, consistent with FFDCA section 408(b)(2).

    In the Federal Register of February 7, 2014 (79 FR 7397) (FRL-9905-56), EPA established tolerances for residues of chlorantraniliprole in or on fruit, stone, group 12-12, except cherry, chickasaw plum, and damson plum at 4.0 ppm; onion, green subgroup 3-07B at 3.0 ppm; peanut, hay at 90 ppm; and peanut at 0.06 ppm. EPA is relying upon those risk assessments and the findings made in the February 7, 2014 Federal Register document in support of this action. The toxicity profile of chlorantraniliprole has not changed. Moreover, because EPA is simply lowering the previously assessed tolerance levels (where the EPA assumed tolerance-level residues for all crops and including the tree nut group 14-12 at 0.02 ppm), the previous dietary estimates also do not change as a result of this action. Therefore, the previously published risk assessments that supported the establishment of those tolerances remain valid.

    The petitioner requested to lower currently established tolerances for residues of chlorantraniliprole in/on hops dried cones from 90 ppm to 40 ppm and globe artichoke from 4.0 ppm to 2.0 ppm in order to harmonize with the Codex maximum residue limits (MRLs). Crop field trial studies were submitted for hops and globe artichoke that indicate lowering these tolerances are appropriate and will support the existing U.S. registrations. The petitioner also requested to lower the existing tolerance of 4.0 ppm for stone fruit group 12-12, except cherry, chickasaw plum, and damson plum and remove the cherry, sweet; cherry, tart; plum, chickasaw; and plum, damson tolerances established at 2.0 ppm and establish a tolerance for stone fruit crop group 12-12 at 2.5 ppm to align with the Canadian MRL. EPA has determined that the existing residue chemistry data support this new tolerance level, which is lower than the current tolerances for some commodities and higher for others. Further, the petitioner requested to convert the tree nut crop group 14 to tree nut crop group 14-12 and to remove the tolerance for pistachio to lower the tolerance for the group (and for the now-included pistachio commodity) from 0.40 ppm to 0.02 ppm to harmonize the U.S. tolerance with the Codex and Canadian MRLs. EPA has determined that the existing residue chemistry data support the request for crop group conversion and for lowering the tolerance level.

    Furthermore, EPA issued a final rule in the Federal Register of September 18, 2013, concerning the addition of certain commodities to the 40 CFR 180.628. The EPA determined that the tolerance level for egg should be increased from 0.2 ppm to 1.0 ppm, and EPA assessed egg using the tolerance of 1.0 ppm in 2013 as well as in February 2014. This was inadvertently omitted from the table in the 2013 Final Rule. Therefore, this document corrects that omission.

    Therefore, EPA relies upon the findings made in the February 7, 2014, Federal Register document, as well as the review of the additional globe artichoke and dried cones hop field trial data and existing residue chemistry data in support of this rule. EPA concludes that there is a reasonable certainty that no harm will result to the general population, or to infants and children from aggregate exposure to chlorantraniliprole residues.

    For a detailed discussion of the aggregate risk assessments and determination of safety for these tolerances, please refer to the February 7, 2014, Federal Register document and its supporting documents, available at http://www.regulations.gov in docket ID number EPA-HQ-OPP-2013-0235. Further information about EPA's determination that an updated risk assessment was not necessary may be found in the document, “Chlorantraniliprole (DPX-E2Y45): Petition for Updating Crop Group Tolerances for Nut Tree Group 14-12 and Fruit Stone Group 12-12, and Amending Established Tolerances for Chlorantraniliprole in/on Artichoke Globe and Hop Dried Cones.” in docket ID number EPA-HQ-OPP-2013-0235.

    IV. Other Considerations A. Analytical Enforcement Methodology

    Adequate enforcement methodology, liquid chromatography mass spectrometry/mass spectrometry (LC/MS/MS); Method uPont-11374, is available to enforce the tolerance expression.

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

    B. International Residue Limits

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

    Based on the data supporting the petition, EPA has harmonized chlorantraniliprole tolerances in or on artichoke, globe at 2.0 ppm; hop, dried cones at 40 ppm; and nut, tree, group 14-12 at 0.02 ppm with established Codex MRLs.

    C. International Trade Considerations

    In this rulemaking, EPA is reducing the tolerances for hops, dried cones from 90 ppm to 40 ppm; globe artichoke from 4.0 ppm to 2.0 ppm; lowering the existing tolerance of 4.0 ppm for stone fruit group 12-12, except cherry, chickasaw plum, and damson plum and establishing a lower tolerance for stone fruit crop group 12-12 at 2.5 ppm; and converting and lowering the tree nut crop group 14 and pistachio tolerances to tree nut crop group 14-12 at 0.40 ppm to 0.02 ppm. The petitioner requested these reductions in order to harmonize with Codex and Canadian MRLs. The reduction is appropriate based on available data and residue levels resulting from registered use patterns.

    In accordance with the World Trade Organization's (WTO) Sanitary and Phytosanitary Measures Agreement, EPA notified the WTO of the request to revise these tolerances on September 14, 2015 as WTO notification G/SPS/N/USA/2778. In this action, EPA is allowing the existing higher tolerances to remain in effect for 6 months following the publication of this rule in order to allow a reasonable interval for producers in the exporting countries to adapt to the requirements of these modified tolerances. On December 14, 2016, those existing higher tolerances will expire, and the new reduced tolerances for artichoke, globe; fruit, stone, group 12-12; hop, dried cones; and nut, tree, group 14-12 will remain to cover residues of chlorantraniliprole on those commodities. Before that date, residues of chlorantraniliprole on those commodities would be permitted up to the higher tolerance levels; after that date, residues of chlorantraniliprole on artichoke, globe; the commodities contained in stone fruit group 12-12 and tree nut group 14-12; and hop, dried cones will need to comply with the new lower tolerance levels. This reduction in tolerance is not discriminatory; the same food safety standard contained in the FFDCA applies equally to domestically produced and imported foods.

    V. Conclusion

    Therefore, tolerances are established for residues of chlorantraniliprole, 3-bromo-N-[4-chloro-2-methyl-6-[(methylamino)-carbonyl]phenyl]-1-(3-chloro-2-pyridinyl)-1H-pyrazole-5-carboxamide, in or on in or on artichoke, globe at 2.0 ppm; fruit, stone, group 12-12 at 2.5 ppm; hop, dried cones at 40 ppm; and nut, tree, group 14-12 at 0.02 ppm. Upon establishment of the aforementioned tolerances, the Agency is removing the tolerances for cherry, sweet at 2.0 ppm; cherry, tart at 2.0 ppm; plum, chickasaw at 2.0 ppm; and plum, damson at 2.0 ppm as they are subsumed within the newly established group 12-12 tolerances. The Agency is adding an expiration date of December 14, 2016 to the existing tolerances for artichoke, globe at 4.0 ppm; nut, tree, group 14 at 0.04 ppm; pistachio at 0.04 ppm; fruit, stone, group 12-12, except cherry, chickasaw plum, and damson plum at 4.0 ppm; and hop, dried cones at 90 ppm. Residues of chlorantraniliprole will be covered by these higher tolerances until the expiration date, after which time, they will need to comply with the lower tolerances being established today. Finally, the Agency is amending the existing tolerance for egg (increasing the tolerance level from 0.2 ppm to 1.0 ppm) to finalize its efforts to establish that tolerance in the Federal Register of September 18, 2013.

    VI. Statutory and Executive Order Reviews

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

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

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

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

    VII. Congressional Review Act

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

    List of Subjects in 40 CFR Part 180

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

    Dated: May 31, 2016. Susan Lewis, Director, Registration Division, Office of Pesticide Programs.

    Therefore, 40 CFR chapter I is amended as follows:

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

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

    2. In § 180.628, in the table in paragraph (a): a. Remove the entries for “Cherry, sweet,” “Cherry, tart,” “Plum, chickasaw,” and “Plum, damson;” b. Revise the entry for “Egg;” c. Amend the existing entries by adding a footnote for “Artichoke, globe,” “Fruit, stone, group 12-12, except cherry, chickasaw plum, and damson plum,” “Hop, dried cones,” “Nut, tree, group 14,” and “Pistachio;” and d. Add alphabetically the entries for “Artichoke, globe,” “Fruit, stone, group 12-12,” “Hop, dried cones,” and “Nut, tree, group 14-12.”

    The additions and revisions read as follows:

    § 180.628 Chlorantraniliprole; tolerances for residues.

    (a) * * *

    Commodity Parts per
  • million
  • *    *    *    *    * Artichoke, globe 1 4.0 Artichoke, globe 2.0 *    *    *    *    * Egg 1.0 *    *    *    *    * Fruit, stone, group 12-12 2.5 Fruit, stone, group 12-12, except cherry, chickasaw plum, and damson plum 1 4.0 *    *    *    *    * Hop, dried cones 1 90 Hop, dried cones 40 *    *    *    *    * Nut, tree, group 14 1 0.04 Nut, tree, group 14-12 0.02 *    *    *    *    * Pistachio 1 0.04 *    *    *    *    * 1 This tolerance expires on December 14, 2016.
    [FR Doc. 2016-13910 Filed 6-13-16; 8:45 am] BILLING CODE 6560-50-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR Part 180 [EPA-HQ-OPP-2014-0749; FRL-9942-23] Clofentezine; Pesticide Tolerances AGENCY:

    Environmental Protection Agency (EPA).

    ACTION:

    Final rule.

    SUMMARY:

    This regulation establishes tolerances for residues of clofentezine in or on multiple commodities which are identified and discussed later in this document. Interregional Research Project Number 4 (IR-4) requested these tolerances under the Federal Food, Drug, and Cosmetic Act (FFDCA).

    DATES:

    This regulation is effective June 14, 2016. Objections and requests for hearings must be received on or before August 15, 2016, and must be filed in accordance with the instructions provided in 40 CFR part 178 (see also Unit I.C. of the SUPPLEMENTARY INFORMATION).

    ADDRESSES:

    The docket for this action, identified by docket identification (ID) number EPA-HQ-OPP-2014-0749, is available at http://www.regulations.gov or at the Office of Pesticide Programs Regulatory Public Docket (OPP Docket) in the Environmental Protection Agency Docket Center (EPA/DC), West William Jefferson Clinton Bldg., Rm. 3334, 1301 Constitution Ave. NW., Washington, DC 20460-0001. The Public Reading Room is open from 8:30 a.m. to 4:30 p.m., Monday through Friday, excluding legal holidays. The telephone number for the Public Reading Room is (202) 566-1744, and the telephone number for the OPP Docket is (703) 305-5805. Please review the visitor instructions and additional information about the docket available at http://www.epa.gov/dockets.

    FOR FURTHER INFORMATION CONTACT:

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

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

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

    • Crop production (NAICS code 111).

    • Animal production (NAICS code 112).

    • Food manufacturing (NAICS code 311).

    • Pesticide manufacturing (NAICS code 32532).

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

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

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

    Under FFDCA section 408(g), 21 U.S.C. 346a, any person may file an objection to any aspect of this regulation and may also request a hearing on those objections. You must file your objection or request a hearing on this regulation in accordance with the instructions provided in 40 CFR part 178. To ensure proper receipt by EPA, you must identify docket ID number EPA-HQ-OPP-2014-0749 in the subject line on the first page of your submission. All objections and requests for a hearing must be in writing, and must be received by the Hearing Clerk on or before August 15, 2016. Addresses for mail and hand delivery of objections and hearing requests are provided in 40 CFR 178.25(b).

    In addition to filing an objection or hearing request with the Hearing Clerk as described in 40 CFR part 178, please submit a copy of the filing (excluding any Confidential Business Information (CBI)) for inclusion in the public docket. Information not marked confidential pursuant to 40 CFR part 2 may be disclosed publicly by EPA without prior notice. Submit the non-CBI copy of your objection or hearing request, identified by docket ID number EPA-HQ-OPP-2014-0749, by one of the following methods:

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

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

    Hand Delivery: To make special arrangements for hand delivery or delivery of boxed information, please follow the instructions at http://www.epa.gov/dockets/contacts.html. Additional instructions on commenting or visiting the docket, along with more information about dockets generally, is available at http://www.epa.gov/dockets.

    II. Summary of Petitioned-For Tolerance

    In the Federal Register of February 11, 2015 (80 FR 7559) (FRL-9921-94), EPA issued a document pursuant to FFDCA section 408(d)(3), 21 U.S.C. 346a(d)(3), announcing the filing of a pesticide petition (PP 4E8312) by IR-4, IR-4 Project Headquarters, Rutgers, The State University of New Jersey, 500 College Road East, Suite 201 W, Princeton, NJ 08540. The petition requested that 40 CFR 180.446 be amended by establishing tolerances for residues of the acaricide clofentezine in or on avocado at 0.3 parts per million (ppm); papaya at 0.3 ppm; fruit, pome, group 11-10 at 0.5 ppm; cherry, subgroup 12-12A at 1.0 ppm; peach, subgroup 12-12B at 1.0 ppm; and fruit, small, vine climbing, except fuzzy kiwifruit, subgroup 13-07F at 1.0 ppm. Upon the approval of the aforementioned tolerances, IR-4 proposed that the existing tolerances for apple at 0.5 ppm; pear at 0.5 ppm; cherry at 1.0 ppm; nectarine at 1.0 ppm; peach at 1.0 ppm; and grape at 1.0 ppm be removed as unnecessary. That document referenced a summary of the petition prepared by Makhteshim Agan of North America, the registrant, which is available in the docket, http://www.regulations.gov. One comment was received in response to the notice of filing, however it related to a different chemical.

    III. Aggregate Risk Assessment and Determination of Safety

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

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

    A. Toxicological Profile

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

    Subchronic and chronic studies indicate the liver is the primary target organ for clofentezine with secondary effects on the thyroid. Body weight and body weight gain were decreased whereas liver weights were increased and hepatocellular enlargement was reported along with other observations (increases in plasma cholesterol and triglyceride levels). The induction of the liver enzyme, uridine diphosphate glucuronyltransferase (UDPGT) and the subsequent increase in the metabolism and the excretion of the thyroid hormone T4 reduced the availability of T4 required for the general metabolism and the maintenance of homeostasis. The decreased levels of plasma T4 resulted in the stimulation of the thyroid by the pituitary gland to raise the plasma T4 levels. Thyroid changes in the form of colloid depletion, thyroid follicular cell hypertrophy and hyperplasia were observed as a means to regain the homeostasis.

    Two pre-natal developmental toxicity studies are available, one in the rat and one in the rabbit. No evidence (quantitative or qualitative) of increased susceptibility was seen in either study (developmental NOAELs were set at or above the limit dose for both studies). There was no evidence (quantitative or qualitative) of increased susceptibility seen following pre-and/or post-natal exposure in rats for 2-generations in the reproduction study (NOAEL set at the highest dose tested).

    Clofentezine does cause thyroid tumors in male rats after long-term high exposure resulting in progressive effects on the thyroid that leads to hyperplasia and eventual tumor formation. No mechanism or mode of action has been submitted to the Agency at this time for clofentezine. As a result, clofentezine has been classified as a possible human carcinogen based on male rat thyroid follicular cell adenoma and/or carcinoma combined tumor rates. The Q1* value for use in clofentezine risk assessment using the 3/4 inter species scaling factor is 3.76 × 10 2 (mg/kg/day) 1. Clofentezine is not considered to be a mutagen.

    Specific information on the studies received and the nature of the adverse effects caused by clofentezine as well as the no-observed-adverse-effect-level (NOAEL) and the lowest-observed-adverse-effect-level (LOAEL) from the toxicity studies can be found at http://www.regulations.gov in the document titled “Clofentezine.” Human-Health Risk Assessment to Support a Section 3 Registration Request to Add New Uses on Avocado and Papaya, and New Uses for Pome Fruit Group 11-10, Cherry sub-group 12-12A, Peach sub-group 12-12B, and Small Fruit Vine Climbing except Fuzzy Kiwifruit Subgroup 13-07F based on Existing Tolerances on Representative Commodities” on page 38 in docket ID number EPA-HQ-OPP-2014-0749.

    B. Toxicological Points of Departure/Levels of Concern

    Once a pesticide's toxicological profile is determined, EPA identifies toxicological points of departure (POD) and levels of concern to use in evaluating the risk posed by human exposure to the pesticide. For hazards that have a threshold below which there is no appreciable risk, the toxicological POD is used as the basis for derivation of reference values for risk assessment. PODs are developed based on a careful analysis of the doses in each toxicological study to determine the dose at which no adverse effects are observed (the NOAEL) and the lowest dose at which adverse effects of concern are identified (the LOAEL). Uncertainty/safety factors are used in conjunction with the POD to calculate a safe exposure level—generally referred to as a population-adjusted dose (PAD) or a reference dose (RfD)—and a safe margin of exposure (MOE). For non-threshold risks, the Agency assumes that any amount of exposure will lead to some degree of risk. Thus, the Agency estimates risk in terms of the probability of an occurrence of the adverse effect expected in a lifetime. For more information on the general principles EPA uses in risk characterization and a complete description of the risk assessment process, see http://www2.epa.gov/pesticide-science-and-assessing-pesticide-risks/assessing-human-health-risk-pesticides.

    A summary of the toxicological endpoints for clofentezine used for human risk assessment is shown in Table 1 of this Unit.

    Table 1—Summary of Toxicological Doses and Endpoints for Clofentezine for Use in Human Health Risk Assessment Exposure/scenario Point of departure
  • and uncertainty/
  • safety factors
  • RfD, PAD, LOC for risk
  • assessment
  • Study and toxicological effects
    Acute dietary (All populations) No appropriate endpoint was identified including developmental toxicity studies in rats and rabbits. Chronic dietary (All populations) NOAEL= 1.25 mg/kg/day
  • UFA = 10x
  • UFH = 10x
  • FQPA SF = 1x
  • Chronic RfD = 0.013 mg/kg/day
  • cPAD = 0.013 mg/kg/day
  • 1-year chronic dog study—LOAEL = 25 mg/kg based on increased liver weights, hepatocellular enlargement, and increased serum cholesterol, triglycerides and alkaline phosphatase levels.
    Cancer (Oral, dermal, inhalation) Classification: Possible human carcinogen (classification of C), Q* using the 3/4 interspecies scaling factor is 3.76 × 10−2 (mg/kg/day)−1. FQPA SF = Food Quality Protection Act Safety Factor. LOAEL = lowest-observed-adverse-effect-level. LOC = level of concern. mg/kg/day = milligram/kilogram/day. NOAEL = no-observed-adverse-effect-level. PAD = population adjusted dose (a = acute, c = chronic). RfD = reference dose. UF = uncertainty factor. UFA = extrapolation from animal to human (interspecies). UFH = potential variation in sensitivity among members of the human population (intraspecies).
    C. Exposure Assessment

    1. Dietary exposure from food and feed uses. In evaluating dietary exposure to clofentezine, EPA considered exposure under the petitioned-for tolerances as well as all existing clofentezine tolerances in 40 CFR 180.446. EPA assessed dietary exposures from clofentezine in food as follows:

    i. Acute exposure. Quantitative acute dietary exposure and risk assessments are performed for a food-use pesticide, if a toxicological study has indicated the possibility of an effect of concern occurring as a result of a 1-day or single exposure. No such effects were identified in the toxicological studies for clofentezine; therefore, a quantitative acute dietary exposure assessment is unnecessary.

    ii. Chronic exposure. In conducting the chronic dietary exposure assessment EPA used the 2003-2008 food consumption data from the U.S. Department of Agriculture's (USDA) National Health and Nutrition Examination Survey, What We Eat in America, (NHANES/WWEIA). As to residue levels in food, a partially refined chronic dietary exposure and risk assessment was performed that directly incorporated average field trial residues and used percent crop treated information.

    iii. Cancer. EPA determines whether quantitative cancer exposure and risk assessments are appropriate for a food-use pesticide based on the weight of the evidence from cancer studies and other relevant data. If quantitative cancer risk assessment is appropriate, cancer risk may be quantified using a linear or nonlinear approach. If sufficient information on the carcinogenic mode of action is available, a threshold or nonlinear approach is used and a cancer RfD is calculated based on an earlier non cancer key event. If carcinogenic mode of action data are not available, or if the mode of action data determines a mutagenic mode of action, a default linear cancer slope factor approach is utilized. Based on the data summarized in Unit III.A., EPA has concluded that clofentezine should be classified as possible human carcinogen and a linear approach has been used to quantify cancer risk. Cancer risk was quantified using the same estimates as discussed in Unit III.C.1.ii.

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

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

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

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

    • Condition c: Data are available on pesticide use and food consumption in a particular area, the exposure estimate does not understate exposure for the population in such area. In addition, the Agency must provide for periodic evaluation of any estimates used. To provide for the periodic evaluation of the estimate of PCT as required by FFDCA section 408(b)(2)(F), EPA may require registrants to submit data on PCT.

    Average percent crop treated estimates were used in the chronic and cancer dietary risk assessments for the following crops that are currently registered for clofentezine: Almonds: 5%; apples: 2.5%; apricots: 2.5%; cherries: 5%; grapes: 1%; nectarines: 5%; peaches: 5%; pears: 5%; and walnuts: 5%.

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

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

    2. Dietary exposure from drinking water. The Agency used screening level water exposure models in the dietary exposure analysis and risk assessment for clofentezine in drinking water. These simulation models take into account data on the physical, chemical, and fate/transport characteristics of clofentezine. Further information regarding EPA drinking water models used in pesticide exposure assessment can be found at http://www2.epa.gov/pesticide-science-and-assessing-pesticide-risks/about-water-exposure-models-used-pesticide.

    Based on the First Index Reservoir Screening Tool (FIRST) and Screening Concentration in Ground Water (SCI-GROW) models, the estimated drinking water concentrations (EDWCs) of clofentezine for chronic exposures for non-cancer and cancer assessments are estimated to be 0.062 parts per billion (ppb) for surface water and 0.041 ppb for ground water.

    Modeled estimates of drinking water concentrations were directly entered into the dietary exposure model. For chronic and cancer dietary risk assessment, the water concentration of value 0.062 ppb was used to assess the contribution to drinking water.

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

    Clofentezine is not registered for any specific use patterns that would result in residential exposure.

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

    EPA has not found clofentezine to share a common mechanism of toxicity with any other substances, and clofentezine does not appear to produce a toxic metabolite produced by other substances. For the purposes of this tolerance action, therefore, EPA has assumed that clofentezine does not have a common mechanism of toxicity with other substances. For information regarding EPA's efforts to determine which chemicals have a common mechanism of toxicity and to evaluate the cumulative effects of such chemicals, see EPA's Web site at http://www2.epa.gov/pesticide-science-and-assessing-pesticide-risks/cumulative-assessment-risk-pesticides.

    D. Safety Factor for Infants and Children

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

    2. Prenatal and postnatal sensitivity. Two pre-natal developmental toxicity studies were available, one in the rat and one in the rabbit. No evidence (quantitative or qualitative) of increased susceptibility was seen in either study (developmental NOAELs were set at or above the limit dose for both studies). There was no evidence (quantitative or qualitative) of increased susceptibility seen following pre-and/or post-natal exposure in rats for 2-generations in the reproduction study (NOAEL set at the highest dose tested).

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

    i. The toxicity database for clofentezine is complete.

    ii. There is no indication that clofentezine is a neurotoxic chemical and there is no need for a developmental neurotoxicity study or additional UFs to account for neurotoxicity.

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

    iv. There are no residual uncertainties identified in the exposure databases. The chronic and cancer analyses incorporated anticipated residues (average residues from available field trial data) for all registered and proposed commodities and the latest PCT data available. The highest estimated drinking water concentrations of clofentezine were incorporated directly into the chronic and cancer assessments. These assessments will not underestimate the exposure and risks posed by clofentezine.

    E. Aggregate Risks and Determination of Safety

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

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

    2. Chronic risk. Using the exposure assumptions described in this unit for chronic exposure, EPA has concluded that chronic exposure to clofentezine from food and water will utilize <1% of the cPAD for all population groups. There are no residential uses for clofentezine.

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

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

    4. Aggregate cancer risk for U.S. population. Using the exposure assumptions described in this unit for cancer exposure, EPA has concluded that by applying the Q1* of 3.76 × 10 2 mg/kg/day to the exposure value results in a cancer risk estimate of 3.8 × 10 7 to the general U.S. population. EPA generally considers cancer risks (expressed as the probability of an increased cancer case) in the range of 1 in 1 million (or 1 × 10 6) or less to be negligible.

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

    IV. Other Considerations A. Analytical Enforcement Methodology

    Adequate enforcement methodology (high performance liquid chromatography (HPLC)) is available to enforce the tolerance expression.

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

    B. International Residue Limits

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

    There are no Codex MRLs for residues on avocado and papaya.

    The U.S. pome fruit tolerance of 0.5 ppm is harmonized with the Codex MRL.

    The U.S. tolerance is 1.0 ppm in/on stone fruit (12-12A and 12-12B). The Codex MRL for stone fruit is 0.5 ppm. The clofentezine residues in/on representative stone fruit crops, cherry and peach, from the submitted U.S. field trial data are greater than 0.5 ppm and setting the tolerances for 12-12A and 12-12B at 0.5 ppm to harmonize with Codex could result a tolerance exceedance for U.S. growers. Therefore, the U.S. tolerance cannot be harmonized with Codex MRL for stone fruit at this time.

    The U.S. tolerance of 1.0 ppm for the crop subgroup fruit, small, vine climbing, except fuzzy kiwifruit, 13-07F does not harmonize with the Codex MRL of 2.0 ppm. The petitioner requested a 13-07F subgroup tolerance at 1.0 ppm, which would maintain the existing tolerance on grapes at 1.0 ppm consistent with the MRL at 1.0 ppm maintained by several countries including Japan and Korea. EPA is not harmonizing with Codex in order to maintain MRL harmony with several other countries to avoid potential export issues.

    V. Conclusion

    Therefore, tolerances are established for residues of clofentezine in or on avocado at 0.30 ppm; papaya at 0.30 ppm; fruit, pome, group 11-10 at 0.50 ppm; cherry, subgroup 12-12A at 1.0 ppm; peach, subgroup 12-12B at 1.0 ppm; and fruit, small, vine climbing, except fuzzy kiwifruit, subgroup 13-07F at 1.0 ppm. In addition, the existing tolerances for apple at 0.5 ppm; pear at 0.5 ppm; cherry at 1.0 ppm; nectarine at 1.0 ppm; peach at 1.0 ppm; and grape at 1.0 ppm are removed as unnecessary.

    VI. Statutory and Executive Order Reviews

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

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

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

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

    VII. Congressional Review Act

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

    List of Subjects in 40 CFR Part 180

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

    Dated: May 31, 2016. Susan Lewis, Director, Registration Division, Office of Pesticide Programs.

    Therefore, 40 CFR chapter I is amended as follows:

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

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

    2. In § 180.446, in the table in paragraph (a)(1): a. Remove the entries for “Apple”, “Cherry”, “Grape”, “Nectarine”, “Peach”, and “Pear”; and b. Add alphabetically the entries for “Avocado”, “Cherry, subgroup 12-12A”, “Fruit, pome, group 11-10”, “Fruit, small, vine climbing, except fuzzy kiwifruit, Subgroup 13-07F”, “Papaya”, and “Peach, subgroup 12-12B”.

    The additions read as follows:

    § 180.446 Clofentezine; tolerances for residues.

    (a) General. (1) * * *

    Commodity Parts per million *    *    *    *    * Avocado 0.30 Cherry, subgroup 12-12A 1.0 Fruit, pome, group 11-10 0.50 Fruit, small, vine climbing, except fuzzy kiwifruit, Subgroup 13-07F 1.0 *    *    *    *    * Papaya 0.30 Peach, subgroup 12-12B 1.0 *    *    *    *    *
    [FR Doc. 2016-13911 Filed 6-13-16; 8:45 am] BILLING CODE 6560-50-P
    81 114 Tuesday, June 14, 2016 Proposed Rules DEPARTMENT OF ENERGY 10 CFR Part 850 [Docket No. AU-RM-11-CBDPP] RIN 1992-AA39 Chronic Beryllium Disease Prevention Program; Correction AGENCY:

    Office of Environment, Health, Safety and Security, U.S. Department of Energy.

    ACTION:

    Notice of proposed rulemaking and public hearings; correction.

    SUMMARY:

    This document corrects the ADDRESSES section to the notice of proposed rulemaking and public hearings which published in the Federal Register on June 7, 2016, regarding the Chronic Beryllium Disease Prevention Program. This correction revises the addresses relating to two of the public hearings.

    DATES:

    June 14, 2016.

    FOR FURTHER INFORMATION CONTACT:

    Jacqueline D. Rogers, 202-586-4714, email: [email protected], or Meredith Harris, 301-903-6061, email: [email protected]

    SUPPLEMENTARY INFORMATION: Correction

    In proposed rule document FR 2016-12547 appearing on page 36704, in the issue of Tuesday, June 7, 2016, (81 FR 36704), the following corrections should be made:

    On page 36704, in the second column, the next to the last paragraph in the ADDRESSES section is corrected to the following:

    1. Richland, WA: HAMMER Federal Training Facility, State Department Room, 2890 Horn Rapids Road, Richland, WA 99354;

    On page 36704, in the third column, the first paragraph in the ADDRESSES section is corrected to the following:

    3. Las Vegas, NV: North Las Vegas Facility, 2621 Losee Road, Building C1, Auditorium, North Las Vegas, NV 89030-4129.

    Issued in Washington, DC, on June 8, 2016. Bill McArthur, Acting Director, Office of Health and Safety.
    [FR Doc. 2016-14020 Filed 6-13-16; 8:45 am] BILLING CODE 6450-01-P
    FEDERAL RESERVE SYSTEM 12 CFR Part 252 [Docket No. R-1540; Regulation YY] RIN 7100 AE 54 Enhanced Prudential Standards for Systemically Important Insurance Companies AGENCY:

    Board of Governors of the Federal Reserve System.

    ACTION:

    Request for public comment on the application of enhanced prudential standards to certain nonbank financial companies.

    SUMMARY:

    Pursuant to section 165 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, the Board of Governors of the Federal Reserve System is inviting public comment on the proposed application of enhanced prudential standards to certain nonbank financial companies that the Financial Stability Oversight Council has determined should be supervised by the Board. The Board is proposing corporate governance, risk-management, and liquidity risk-management standards that are tailored to the business models, capital structures, risk profiles, and systemic footprints of the nonbank financial companies with significant insurance activities.

    DATES:

    Comments must be submitted by August 17, 2016.

    ADDRESSES:

    You may submit comments, identified by Docket No. R-1540, RIN 7100 AE 54, by any of the following methods:

    Agency Web site: http://www.federalreserve.gov. Follow the instructions for submitting comments at http://www.federalreserve.gov/generalinfo/foia/ProposedRegs.cfm.

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

    Email: [email protected] Include docket R-1540, RIN 7100 AE 54 in the subject line of the message.

    FAX: (202) 452-3819 or (202) 452-3102.

    Mail: Robert deV. Frierson, Secretary, Board of Governors of the Federal Reserve System, 20th Street and Constitution Avenue NW., Washington, DC 20551.

    All public comments are available from the Board's Web site are http://www.federalreserve.gov/generalinfo/foia/ProposedRegs.cfm as submitted, unless modified for technical reasons. Accordingly, your comments will not be edited to remove any identifying or contact information. Public comments may also be viewed electronically or in paper form in Room 3515, 1801 K Street NW., (between 18th and 19th Streets), Washington, DC 20551 between 9:00 a.m. and 5:00 p.m. on weekdays.

    FOR FURTHER INFORMATION CONTACT:

    Thomas Sullivan, Associate Director, (202) 475-7656, Linda Duzick, Manager, (202) 728-5881, Noah Cuttler, Senior Financial Analyst, (202) 912-4678, or Matt Walker, Senior Analyst & Insurance Team Project Manager, (202) 872-4971, Division of Banking Supervision and Regulation; or Laurie Schaffer, Associate General Counsel, (202) 452-2272, Tate Wilson, Counsel, (202) 452-3696, or Steve Bowne, Senior Attorney, (202) 452-3900, Legal Division.

    SUPPLEMENTARY INFORMATION:

    I. Introduction

    Section 165 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) directs the Board of Governors of the Federal Reserve System (Board) to establish enhanced prudential standards for nonbank financial companies that the Financial Stability Oversight Council (Council) has determined should be supervised by the Board and bank holding companies with total consolidated assets equal to or greater than $50 billion in order to prevent or mitigate risks to U.S. financial stability that could arise from the material financial distress or failure, or ongoing activities, of these companies.1 The enhanced prudential standards must include risk-based capital requirements and leverage limits, liquidity requirements, certain risk-management requirements, resolution-planning requirements, single-counterparty credit limits, and stress-test requirements. Section 165 also permits the Board to establish additional enhanced prudential standards, including a contingent capital requirement, an enhanced public disclosure requirement, a short-term debt limit, and any other prudential standards that the Board determines are appropriate.

    1 12 U.S.C. 5365.

    In prescribing enhanced prudential standards, section 165(a)(2) of the Dodd-Frank Act permits the Board to tailor the enhanced prudential standards among companies on an individual basis, taking into consideration their “capital structure, riskiness, complexity, financial activities (including the financial activities of their subsidiaries), size, and any other risk-related factors that the Board . . . deems appropriate.” 2 In addition, under section 165(b)(3) of the Dodd-Frank Act, the Board is required to take into account differences among bank holding companies covered by section 165 of the Dodd-Frank Act and nonbank financial companies supervised by the Board, based on statutory considerations.3

    2 12 U.S.C. 5365(a)(2).

    3See 12 U.S.C. 5365(b)(3).

    The factors the Board must consider include: (1) The factors described in sections 113(a) and (b) of the Dodd-Frank Act (12 U.S.C. 5313(a) and (b)); (2) whether the companies own an insured depository institution; (3) nonfinancial activities and affiliations of the companies; and (4) any other risk-related factors that the Board determines appropriate.4 The Board must, as appropriate, adapt the required standards in light of any predominant line of business of nonbank financial companies, including activities for which particular standards may not be appropriate.5 Section 165(b)(3) of the Dodd-Frank Act also requires the Board, to the extent possible, to ensure that small changes in the factors listed in sections 113(a) and 113(b) of the Dodd-Frank Act would not result in sharp, discontinuous changes in the enhanced prudential standards established by the Board under section 165(b)(1) of the Dodd-Frank Act.6 The statute also directs the Board to take into account any recommendations made by the Council pursuant to its authority under section 115 of the Dodd-Frank Act.7

    4 12 U.S.C. 5365(b)(3)(A).

    5 12 U.S.C. 5365(b)(3)(D).

    6 12 U.S.C. 5365(b)(3)(B).

    7 12 U.S.C. 5365(b)(3)(C).

    For bank holding companies with total consolidated assets equal to or greater than $50 billion and certain foreign banking organizations, the Board has issued an integrated set of enhanced prudential standards through a series of rulemakings, including the Board's capital plan rule,8 stress-testing rules,9 resolution plan rule,10 and the Board's enhanced prudential standards rule under Regulation YY.11 As part of the integrated enhanced prudential standards applicable to the largest, most complex bank holding companies, the Board also adopted enhanced liquidity requirements through the liquidity coverage ratio rule and adopted enhanced leverage capital requirements through a supplementary leverage ratio. Further, the Board issued risk-based capital charges and an enhanced supplementary leverage ratio for the most systemic bank holding companies.12 In addition, through a final order the Board established enhanced prudential standards for General Electric Capital Corporation, a nonbank financial company designated by the Council for supervision by the Board.13 In the preamble accompanying the final enhanced prudential standards regulation for bank holding companies, the Board stated its intent to assess thoroughly the business model, capital structure, and risk profile of each company in considering the application of enhanced prudential standards to nonbank financial companies designated by the Council, consistent with the Dodd-Frank Act.14

    8 12 CFR 225.8.

    9See 12 CFR part 252.

    10 12 CFR part 243.

    11See 79 FR 17420 (March 27, 2014).

    12 12 CFR 217.11(c).

    13 80 FR 142 (July 24, 2015).

    14See 79 FR 17240, 17245 (March 27, 2014).

    The Board invites public comment on the application of corporate governance and risk-management and liquidity risk-management standards to certain insurance-focused nonbank financial companies that the Council determined should be subject to Board supervision.15 Specifically, the enhanced prudential standards would apply to any nonbank financial company that meets two requirements: (1) The Council has determined pursuant to section 113 of the Dodd-Frank Act that the company should be supervised by the Board and subjected to enhanced prudential standards, and (2) the company has 40 percent or more of its total consolidated assets related to insurance activities as of the end of either of the two most recently completed fiscal years (systemically important insurance companies) or otherwise has been made subject to these requirements by the Board. As of the date of publication of this document in the Federal Register, American International Group, Inc. (AIG), and Prudential Financial, Inc. (Prudential), would be required to comply with the proposed enhanced prudential standards, if adopted as proposed.16

    15 The Board intends to consider enhanced risk-based capital and leverage requirements, liquidity requirements, single-counterparty credit limits, a debt-to-equity limit, and stress testing requirements at a later date. In addition, the Board has issued a resolution plan rule that by its terms applies to all nonbank financial companies supervised by the Board.

    16 As noted above, General Electric Capital Corporation is already subject by Board order to certain enhanced prudential standards.

    The corporate governance and risk-management standard would build on the core provisions of the Board's SR letter 12-17, Consolidated Supervision Framework for Large Financial Institutions.17 The proposed liquidity risk-management requirements would help mitigate liquidity risks at systemically important insurance companies. The proposal would tailor these standards to account for the differences in business models, capital structure, risk profiles, existing supervisory framework, and systemic footprints between bank holding companies and systemically important insurance companies.

    17 Supervision and Regulation Letter 12-17/Consumer Affairs Letter 12-14 (December 17, 2012), available at https://www.federalreserve.gov/bankinforeg/srletters/sr1217.htm.

    The Board believes that it is appropriate to seek public comment on the application of the proposed standards in order to provide transparency regarding the regulation and supervision of systemically important insurance companies. The public comment process will provide systemically important insurance companies supervised by the Board and interested members of the public with the opportunity to comment and will help guide the Board in future application of enhanced prudential standards to other nonbank financial companies.

    Question 1: The Board invites comment on all aspects of the proposed rule, including in particular the aspects noted in more detailed questions at the end of each section.

    Question 2: The Board invites comment on the 40 percent threshold contained in the proposed definition of systemically important insurance company. Would an alternative measure be more appropriate? Why or why not?

    II. Corporate Governance and Risk-Management Standard A. Background

    During the preceding decades and the recent financial crisis in particular, a number of insurers that experienced material financial distress had significant deficiencies in key areas of corporate governance and risk management.18 Effective enterprise-wide risk management by large, interconnected financial companies promotes financial stability by reducing the likelihood of a large, interconnected financial company's material distress or failure. An enterprise-wide approach to risk management would allow systemically important insurance companies to appropriately identify, measure, monitor, and control risk throughout their entire organizations, including risks that may arise from intragroup transactions, unregulated entities, or centralized material operations that would not be subject to review at the legal entity level.

    18See Standard and Poor's Ratings Services, “What May Cause Insurance Companies to Fail and How this Influences Our Criteria” (June 2013), at 11-13; see also U.S. House of Representatives, “Failed Promises: Insurance Company Insolvencies” (1990); Financial Crisis Inquiry Commission, “Final Report of the National Commission on the Causes of the Financial and Economic Crisis in the United States” (January 2011), pg. 352, available at http://fcic-static.law.stanford.edu/cdn_media/fcic-reports/fcic_final_report_full.pdf.

    Accordingly, the Board is proposing to apply to systemically important insurance companies an enhanced corporate governance and risk-management standard that would build on the core provisions of SR 12-17, the Board's consolidated supervision framework for large financial institutions.19 These standards would be applied, however, in a manner that is tailored to account for the business model, capital structure, risk profile, and activities of financial firms that are largely engaged in insurance (rather than banking) activities. Specifically, the proposal creates responsibilities for a systemically important insurance company's risk committee, chief risk officer, and chief actuary.

    19 SR 12-17 sets forth a framework for the consolidated supervision of large financial institutions, and has two primary objectives: (1) Enhancing resiliency of a firm to lower the probability of its failure or inability to serve as a financial intermediary, and (2) reducing the impact on the financial system and the broader economy in the event of a firm's failure or material weakness.

    B. Risk Committee and Risk-Management Framework

    Consistent with section 165(h)(1) of the Dodd-Frank Act, the proposed rule would require a systemically important insurance company to maintain a risk committee that approves and periodically reviews the risk-management policies of the company's global operations and oversees the operation of the company's global risk-management framework.20 A large, interconnected financial institution's risk committee, acting in its oversight role, should fully understand the institution's corporate governance and risk-management framework and have a general understanding of its risk-management practices.

    20 12 U.S.C. 5365(h)(1).

    The proposal would also require that the risk committee oversee the systemically important insurance company's enterprise-wide risk-management framework, and that this framework be commensurate with the systemically important insurance company's structure, risk profile, complexity, activities, and size. An enterprise-wide risk-management framework facilitates management of and creates accountability for risks that reside in different geographic areas and lines of business. The risk-management framework would be required to include policies and procedures for establishing risk-management governance and procedures and risk-control infrastructure for the company's global operations. To implement and monitor compliance with these policies and procedures, the proposal would require the company to have processes and systems that (1) have mechanisms to identify and report risks and risk-management deficiencies, including emerging risks, and ensure effective and timely implementation of actions to address such risks and deficiencies; (2) establish managerial and employee responsibility for risk management; (3) ensure the independence of the risk-management function; and (4) integrate risk-management and associated controls with management goals and its compensation structure for its global operations.

    A systemically important insurance company's risk-management framework would be strengthened by having an appropriate level of stature within its overall corporate governance framework. Accordingly, the proposal would provide that a systemically important insurance company's risk committee be an independent committee of the company's board of directors and have, as its sole and exclusive function, responsibility for the risk-management policies of the company's global operations and oversight of the operation of the company's global risk-management framework. The risk committee would be required to report directly to the systemically important insurance company's board of directors and would receive and review regular reports on not less than a quarterly basis from the company's chief risk officer. In addition, the risk committee would be required to meet at least quarterly, fully document and maintain records of its proceedings, and have a formal, written charter that is approved by the systemically important insurance company's board of directors.

    Consistent with section 165(h)(3)(C) of the Dodd-Frank Act, the proposal would require that the risk committee include at least one member with experience in identifying, assessing, and managing risk exposures of large, complex financial firms.21 For this purpose, a financial firm would include an insurance company, a securities broker-dealer, or a bank. The individual's experience in risk management would be expected to be commensurate with the company's structure, risk profile, complexity, activities, and size, and the company would be expected to demonstrate that the individual's experience is relevant to the particular risks facing the company. While the proposal would require that only one member of the risk committee have experience in identifying, assessing, and managing risk exposures of large, complex firms, all risk committee members should have a general understanding of risk-management principles and practices relevant to the company.

    21See 12 U.S.C. 5365(h)(3)(C).

    Consistent with section 165(h)(3)(B) of the Dodd-Frank Act, the proposed rule also would include certain requirements to ensure that the chair of the risk committee has sufficient independence from the systemically important insurance company.22 The proposal would require that the chair of the risk committee (1) not be an officer or employee of the company nor have been one during the previous three years; (2) not be a member of the immediate family of a person who is, or has been within the last three years, an executive officer of the company; 23 and (3) meet the requirements for an independent director under Item 407 of the Securities and Exchange Commission's (SEC) Regulation S-K, or must qualify as an independent director under the listing standards of a national securities exchange, as demonstrated to the satisfaction of the Board, if the company does not have an outstanding class of securities traded on a national securities exchange.

    22See 12 U.S.C. 5365(h)(3)(B).

    23 For purposes of this requirement, “immediate family” would be defined pursuant to the Board's Regulation Y, 12 CFR 225.41(b)(3), and “executive officer” would be defined pursuant to the Board's Regulation O, 12 CFR 215.2(e)(1).

    The Board views the active involvement of independent directors as vital to robust oversight of risk management and encourages companies generally to include additional independent directors as members of their risk committees. However, the Board notes that not all members of the risk committee would be required to be independent, and involvement of directors affiliated with the company on the risk committee could complement the involvement of independent directors.

    Question 3: Are there additional qualifications and experience that the Board should require of a member or members of the risk committee of a systemically important insurance company?

    Question 4: The Board invites comment on whether the structure of the risk committee and the duties proposed to be assigned to the risk committee are appropriate.

    C. Chief Risk Officer and Chief Actuary

    Most large, interconnected financial institutions, including large insurance companies, designate a chief risk officer to facilitate an enterprise-wide approach to the identification and management of all risks within an organization, regardless of where they are originated or housed. The chief risk officer supplements the work of legal entity, risk level (e.g., credit or operational risk), and line of business risk-management activities by identifying, measuring, and monitoring risks that may exist intentionally or unintentionally. The proposed rule would require each systemically important insurance company to have a chief risk officer and describes the minimum responsibilities of the chief risk officer. Under the proposal, the chief risk officer's function would extend to all risks facing the systemically important insurance company, including risks from non-insurance activities and insurance activities, such as risks arising out of unanticipated increases in reserves.

    The proposal provides that the chief risk officer would be responsible for overseeing (1) the establishment of risk limits on an enterprise-wide basis and monitoring compliance with such limits; (2) the implementation of and ongoing compliance with the policies and procedures establishing risk-management governance and the development and implementation of the processes and systems related to the global risk-management framework; and (3) management of risks and risk controls within the parameters of the company's risk control framework, and monitoring and testing of such risk controls. The chief risk officer also would be responsible for reporting risk-management deficiencies and emerging risks to the risk committee.

    The proposal would require the chief risk officer to have experience in identifying, assessing, and managing risk exposures of large, complex financial firms. The minimum qualifications for a chief risk officer would be similar to the risk-management experience requirement that at least one member of the company's risk committee must meet. The proposal was designed with the expectation that a systemically important insurance company would be able to demonstrate that its chief risk officer's experience is relevant to the particular risks facing the company and is commensurate with the company's structure, risk profile, complexity, activities, and size.

    The proposed standard would also require systemically important insurance companies to have a chief actuary to ensure an enterprise-wide view of reserve adequacy across legal entities, lines of business, and geographic boundaries. Inadequate reserving is a common cause of insurer insolvencies.24 Insurance companies have complex balance sheets that depend heavily on estimates concerning the amount and timing of payments. Actuaries at insurance companies serve a critical role by developing these estimates and providing other technical insights on risk and financial performance. The estimates and the related processes, methodologies, and documentation can vary across jurisdictions and lines of businesses. The systemically important insurance companies have numerous insurance company subsidiaries and lines of businesses with their own actuarial functions. The organization may not have, however, an actuarial role or roles with the appropriate amount of stature and independence from the lines of business and legal entities.

    24See Standard and Poor's Ratings Services, “What May Cause Insurance Companies to Fail and How this Influences Our Criteria” (June 2013), pg. 8-10; see also U.S. House of Representatives, “Failed Promises: Insurance Company Insolvencies” (1990).

    The chief actuary would be responsible for advising the chief executive officer and other members of senior management and the board's audit committee on the level of reserves. Under the proposed rule, the chief actuary would also have oversight responsibilities over (1) implementation of measures that assess the sufficiency of reserves; (2) review of the appropriateness of actuarial models, data, and assumptions used in reserving; and (3) implementation of and compliance with appropriate policies and procedures relating to actuarial work in reserving. The chief actuary would be required to ensure that the company's actuarial units perform in accordance with an articulated set of standards that govern process, methodologies, data, and documentation; comply with applicable jurisdictional regulations; and adhere to the relevant codes of actuarial conduct and practice standards. The proposed rule would permit the chief actuary to have additional responsibilities, including overseeing ratemaking for insurance products.

    If a systemically important insurance company has significant amounts of life insurance and property and casualty insurance business, the proposal would allow systemically important insurance companies to have co-chief actuaries—one responsible for the company's life business and one responsible for the company's property and casualty business. Within the United States, the two different businesses have historically had separate professional organizations and correspondingly different professional examination requirements to obtain actuarial credentials. The actuarial techniques used in these two businesses starkly differ. While a single position with an enterprise-wide view of reserve adequacy is desirable, the Board recognizes that the need for chief actuaries to have the expertise necessary to carry out their duties. Thus, the proposed rule would permit, but not require, a systemically important insurance company to appoint a chief actuary with enterprise-wide responsibility for the life insurance activities and a separate chief actuary with enterprise-wide responsibility for the property and casualty insurance activities.

    Under the proposed rule, the chief actuary would be expected to have experience that is relevant to the functions performed and commensurate with the company's structure, risk profile, complexity, activities, and size. This background should allow the chief actuary to discuss reserve adequacy with executive management and to communicate on actual practices and techniques with the underwriting, claims, legal, treasury, and other departments.

    Under the proposed rule, the chief risk officer and chief actuary would be required to maintain a level of independence. In addition to other lines of reporting, the chief risk officer and chief actuary would be required to report directly to their board's risk committee and audit committee, respectively. Requiring the chief risk officer and chief actuary to report directly to board committees provides stature and independence from the lines of businesses and legal entities, which facilitates unbiased insurance risk assessment and estimation of insurance reserves. Furthermore, the proposal would not allow the chief risk officer and chief actuary roles to be performed by the same person because the positions serve distinct and separate independent oversight functions within the company. This separation would allow the risk group to review and challenge the actuarial assumptions used to prepare financial statements and provide an extra line of defense against improper reserving.

    In addition, the proposal would require a systemically important insurance company to ensure that the compensation and other incentives provided to the chief risk officer and chief actuary are consistent with their functions of providing objective assessments of a company's risks and actuarial estimates. This requirement would supplement existing Board guidance on incentive compensation, which provides, among other things, that compensation for employees in risk-management and control functions should avoid conflicts of interest and that incentive compensation received by these employees should not be based substantially on the financial performance of the business units that they review.25 In addition, the proposed requirement would allow systemically important insurance companies wide discretion to adopt compensation structures for chief risk officers and chief actuaries, whether through a compensation committee or otherwise, as long as the structure of their compensation allows them to objectively assess risk and does not create improper incentives to take inappropriate risks.

    25See Guidance on Sound Incentive Compensation Policies, 75 FR 36395 (June 25, 2010).

    Question 5: Are the responsibilities and requirements for the chief risk officer and the chief actuary of a systemically important insurance company appropriate? What additional responsibilities and requirements should the Board consider imposing?

    Question 6: Should the Board require a single, enterprise-wide chief actuary instead of allowing the position to be split between life and property and casualty operations? Why or why not?

    III. Liquidity Risk-Management Standard A. Background

    The activities and liabilities of systemically important insurance companies generate liquidity risk. The financial crisis that began in 2007 demonstrated that liquidity can evaporate quickly and cause severe stress in the financial markets. In some cases, financial companies had difficulty in meeting their obligations as they became due because sources of funding became severely restricted. The financial crisis and past insurance failures also demonstrate that even solvent insurers may experience material financial distress, including failure, if they do not manage their liquidity in a prudent manner.26 Although many of a systemically important insurance company's liabilities are long-term or contingent upon the occurrence of a future event, such as the death of the insured or destruction of insured property, certain insurance contracts are subject to surrender or withdrawal with little or no penalty and on short notice and may create significant unanticipated demands for liquidity. Additionally, some activities and liabilities such as securities lending, issuance of some forms of funding agreements, collateral calls on derivatives used for hedging, and other sources can create liquidity needs during stress. For systemically important insurance companies, the negative effects of their material financial distress from a liquidity shortage could be transmitted to the broader economy through the sale of financial assets in a manner that could disrupt the functioning of key markets or cause significant losses or funding problems at other firms with similar holdings.

    26See U.S. Govt. Accountability Office, GAO-13-583, “Insurance Markets: Impacts of and Regulatory Response to the 2007-2009 Financial Crisis,” June 2013, at 10-16, 46-48, available at http://gao.gov/assets/660/655612.pdf. See also Standard and Poor's Ratings Services, “What May Cause Insurance Companies to Fail and How this Influences Our Criteria” (June 2013).

    The proposal would require that a systemically important insurance company implement a number of provisions to manage its liquidity risk. For purposes of the proposed rule, liquidity is defined as a systemically important insurance company's capacity to meet efficiently its expected and unexpected cash flows and collateral needs at a reasonable cost without adversely affecting the daily operations or the financial condition of the systemically important insurance company. Under the proposed rule, liquidity risk means the risk that a systemically important insurance company's financial condition or safety and soundness will be adversely affected by its actual or perceived inability to meet its cash and collateral obligations.

    The proposed rule would require a systemically important insurance company to meet key internal control requirements with respect to liquidity risk management, to generate comprehensive cash-flow projections, to establish and monitor its liquidity risk tolerance, and to maintain a contingency funding plan to manage liquidity stress events when normal sources of funding may not be available. The proposed rule also would introduce liquidity stress-testing requirements for a systemically important insurance company and would require the company to maintain liquid assets sufficient to meet net cash outflows for 90 days over the range of liquidity stress scenarios used in the internal stress testing.

    B. Internal Control Requirements

    To reduce the risk of failure triggered by a liquidity event, the proposed rule would require a systemically important insurance company's board of directors, risk committee, and senior management to fulfill key corporate governance and internal control functions with respect to liquidity risk management. The proposed rule would also require a systemically important insurance company to institute an independent review function to provide an objective assessment of the company's liquidity risk-management framework.

    1. Board of Directors and Risk Committee Responsibilities

    The proposed rule would require a systemically important insurance company's board of directors to approve at least annually the company's liquidity risk tolerance. This liquidity risk tolerance should set forth the acceptable level of liquidity risk that a systemically important insurance company may assume in connection with its operating strategies and should take into account the company's capital structure, risk profile, complexity, activities, and size. Typically, more liquid, shorter-duration assets provide lower expected returns than similar assets with longer durations. Risk tolerances should be articulated in a way that all levels of management can clearly understand and apply these tolerances to all aspects of liquidity risk management throughout the organization. In addition, the proposal would require the board of directors to (1) review liquidity risk practices and performance at least semi-annually to determine whether the systemically important insurance company is operating in accordance with its established liquidity risk tolerance, and (2) approve and periodically review the liquidity risk-management strategies, policies, and procedures established by senior management.

    The proposal would also require the risk committee or a designated subcommittee of the risk committee to review and approve the systemically important insurance company's contingency funding plan at least annually and whenever the company materially revises the plan. As discussed below, the contingency funding plan is the systemically important insurance company's compilation of policies, procedures, and action plans for managing liquidity stress events. In fulfilling this proposed requirement, the risk committee or designated subcommittee would report the results of its review to a systemically important insurance company's board of directors.

    2. Senior Management Responsibilities

    To ensure that a systemically important insurance company properly implements its liquidity risk-management framework within the tolerances established by the company's board of directors, the Board is proposing to require senior management of a systemically important insurance company to be responsible for several key liquidity risk-management functions.

    First, the proposed rule would require senior management to establish and implement strategies, policies, and procedures designed to manage effectively the systemically important insurance company's liquidity risk. In addition, the proposal would require that senior management oversee the development and implementation of liquidity risk measurement and reporting systems and determine at least quarterly whether the systemically important insurance company is operating in accordance with such policies and procedures and is in compliance with the liquidity risk-management, stress-testing, and buffer requirements.

    Second, the proposal would require senior management to report at least quarterly to the board of directors or the risk committee on the systemically important insurance company's liquidity risk profile and liquidity risk tolerance. More frequent reporting would be warranted if material changes in the company's liquidity profile or market conditions occur.

    Third, before a systemically important insurance company offers a new product or initiates a new activity that could potentially have a significant effect on the systemically important insurance company's liquidity risk profile, senior management would be required to evaluate the liquidity costs, benefits, and risks of the product or activity and approve it. As part of the evaluation, senior management would be required to determine whether the liquidity risk associated with the new product or activity (under both current and stressed conditions) is within the company's established liquidity risk tolerance. In addition, senior management would be required to review at least annually significant business activities and products to determine whether any of these activities or products creates or has created any unanticipated liquidity risk and whether the liquidity risk of each activity or product is within the company's established liquidity risk tolerance. An example of a significant business activity might include a company's securities lending operations or a particular line of business such as the issuance of funding agreements. This review should be done on a granular enough basis to allow for consideration of material differences in liquidity risk that might occur across jurisdictions or product features, such as a market value adjustment feature in an insurance contract.27

    27 Market value adjustment features tie the surrender value of an insurance contract to changes in market conditions.

    Fourth, senior management would be required to review the cash-flow projections (as described below) at least quarterly to ensure that the liquidity risk of the systemically important insurance company is within the established liquidity risk tolerance.

    Fifth, senior management would be required to establish liquidity risk limits and review the company's compliance with those limits at least quarterly. As described in § 252.164(g) of the proposed rule, systemically important insurance companies would be required to establish limits on (1) concentrations in sources of funding by instrument type, single counterparty, counterparty type, secured and unsecured funding, and as applicable, other forms of liquidity risk; (2) potential sources of liquidity risk arising from insurance liabilities; (3) the amount of non-insurance liabilities that mature within various time horizons; and (4) off-balance sheet exposures and other exposures that could create funding needs during liquidity stress events. In addition, the proposal would require the size of each limit to be consistent with the company's established liquidity risk tolerance and reflect the company's capital structure, risk profile, complexity, activities, and size.

    Sixth, senior management would be required to (1) approve the liquidity stress testing practices, methodologies, and assumptions as set out in § 252.165(a) of the proposed rule at least quarterly and whenever the systemically important insurance company materially revises such practices, methodologies, or assumptions; (2) review at least quarterly both the liquidity stress-testing results produced under § 252.165(a) of the proposed rule and the liquidity buffer provided in § 252.165(b) of the proposed rule; and (3) review periodically the independent review of the liquidity stress tests under § 252.165(d) of the proposed rule.

    The proposal would allow a systemically important insurance company to assign these senior management responsibilities to its chief risk officer, who would be considered a member of the senior management of the systemically important insurance company.

    Question 7: The Board invites comment on whether there are additional liquidity risk-management responsibilities that the rule should require of senior management.

    3. Independent Review

    An independent review function is a critical element of a financial institution's liquidity risk-management program because it can identify weaknesses in liquidity risk management that would be overlooked by the management functions that execute funding. Accordingly, the Board is proposing to require a systemically important insurance company to maintain an independent review function that meets frequently (but no less than annually) to review and evaluate the adequacy and effectiveness of the company's liquidity risk-management processes, including its liquidity stress-test processes and assumptions. Under the proposal, this review function would be required to be independent of management functions that execute funding (e.g., the treasury function), but it would not be required to be independent of the liquidity risk-management function. In addition, the proposal would require the independent review function to assess whether the company's liquidity risk-management framework complies with applicable laws, regulations, supervisory guidance, and sound business practices, and report for corrective action any material liquidity risk-management issues to the board of directors or the risk committee.

    An appropriate internal review conducted by the independent review function under the proposed rule should address all relevant elements of the liquidity risk-management framework, including adherence to the established policies and procedures and the adequacy of liquidity risk identification, measurement, and reporting processes. Personnel conducting these reviews should seek to understand, test, and evaluate the liquidity risk-management processes, document their review, and recommend solutions for any identified weaknesses.

    C. Cash Flow Projections

    Comprehensive projections of cash flows from a firm's various operations are a critical tool to help the institution manage its liquidity risk. The proposal would require that the company produce comprehensive enterprise-wide cash-flow projections that project cash flows arising from assets, liabilities, and off-balance sheet exposures over short and long-term time horizons, including time horizons longer than one year. Longer time horizons are particularly important for insurance companies, which generally have liabilities that extend far into the future. In addition, tracking cash-flow mismatches can help a systemically important insurance company identify potential liquidity issues and facilitate asset liability management, particularly as it relates to reinvestment risk from interest rate changes. The proposal would require that the systemically important insurance company update short-term cash-flow projections daily and update longer-term cash-flow projections at least monthly. These updates would not always require revisiting actuarial estimates; however, the updates would need to roll the cash flows forward and revise assumptions as needed based on new data and changing market conditions.

    To ensure that the cash flow projections would sufficiently analyze liquidity risk exposure to contingent events, the proposed rule would require that a systemically important insurance company establish a methodology for making projections that include all material liquidity exposures and sources, including cash flows arising from (1) anticipated claim and annuity payments; (2) policyholder options including surrenders, withdrawals, and policy loans; (3) collateral requirements on derivatives and other obligations; (4) intercompany transactions; (5) premiums on new and renewal business; (6) expenses; (7) maturities and renewals of funding instruments, including through the operation of any provisions that could accelerate the maturity; and (8) investment income and proceeds from assets sales. The proposal would require that the methodology (1) include reasonable assumptions regarding the future behavior of assets, liabilities, and off-balance sheet exposures, (2) identify and quantify discrete and cumulative cash flow mismatches over various time periods, and (3) include sufficient detail to reflect the capital structure, risk profile, complexity, currency exposure, activities, and size of the systemically important insurance company, and any applicable legal and regulatory requirements. The proposal provides that analyses may be categorized by business line, currency, or legal entity.

    Given the critical importance that the methodology and underlying assumptions play in liquidity risk management, a systemically important insurance company would be required to adequately document its methodology and assumptions used in making its cash flow projections.

    Question 8: The Board invites comment on whether the above requirements are appropriate for managing cash flows at systemically important insurance companies. Should any aspects of this cash-flow projection requirement be modified to better address the risk of systemically important insurance companies?

    Question 9: Should the Board consider a different level of frequency for requiring systemically important insurance companies to update their cash flow projections? If so, what frequency would be appropriate and why?

    D. Contingency Funding Plan

    Under the proposed rule, a systemically important insurance company would be required to establish and maintain a contingency funding plan for responding to a liquidity crisis, identify alternate liquidity sources that the company can access during liquidity stress events, and describe steps that should be taken to ensure that the company's sources of liquidity are sufficient to fund its normal operating requirements under stress events. These provisions require the firm to develop and put in place plans designed to ensure that the firm will have adequate sources of liquidity to meet its obligations during the normal course of business. The proposal does not itself set a minimum liquidity requirement that would apply to all firms.

    The proposal would require the contingency funding plan to include a quantitative assessment, an event management process, and monitoring requirements. The proposal would also require the plan to be commensurate with a systemically important insurance company's capital structure, risk profile, complexity, activities, size, and established liquidity risk tolerance.

    Under the proposed rule, a systemically important insurance company would perform a quantitative assessment to identify liquidity stress events that could have a significant effect on the company's liquidity, assess the level and nature of such effect, and assess available funding sources during identified liquidity events. Such an assessment should delineate the various levels of stress severity that could occur during a stress event and identify the various stages for each type of event, spanning from the event's inception until its resolution. The types of events would include temporary, intermediate, and long-term disruptions. Under the proposal, possible stress events may include deterioration in asset quality, a spike in interest rates, an insurance catastrophe such as a pandemic that results in a large number of claims, an equity market decline, multiple ratings downgrades, a widening of credit default swap spreads, operating losses, negative press coverage, or other events that call into question a systemically important insurance company's liquidity. The stress events should be forecast in a comprehensive way across legal entities to identify gaps on an enterprise-wide basis. In addition, the proposal would require a systemically important insurance company to incorporate information generated by liquidity stress testing.

    The proposed rule would provide that a systemically important insurance company include in its contingency funding plan procedures for monitoring emerging liquidity stress events and identifying early warning indicators that are tailored to the company's capital structure, risk profile, complexity, activities, and size. Early warning indicators should include negative publicity concerning an asset class owned by the company, potential deterioration of the company's financial condition, a rating downgrade, and/or a widening of the company's debt or credit default swap spreads. In addition, a systemically important insurance company's contingency funding plan would be required to at least incorporate collateral and legal entity liquidity risk monitoring.

    As part of the quantitative assessment, a systemically important insurance company would be required to include in its contingency funding plan both an assessment of available funding sources and needs and an identification of alternative funding sources that may be used during the identified liquidity stress events. To determine available and alternative funding sources, a systemically important insurance company would be expected under the proposal to analyze the potential erosion of available funding at various stages and severity levels of each stress event and identify potential cash flow mismatches that may occur. This analysis would include all material on- and off-balance sheet cash flows and their related effects, and would be based on a realistic assessment of both the behavior of policyholders and other counterparties and of a systemically important insurance company's cash inflows, outflows, and funds that would be available (after considering restrictions on the transferability of funds within the group) at different time intervals during the identified liquidity stress event. In addition, a systemically important insurance company should work proactively to have in place any administrative procedures and agreements necessary to access any alternative funding source.

    The proposed rule would also require a systemically important insurance company's contingency funding plan to identify the circumstances in which the company would implement an action plan to respond to liquidity shortfalls for identified liquidity stress events. The action plan would clearly describe the strategies that a systemically important insurance company would use during such an event, including (1) the methods that the company would use to access alternative funding sources, (2) the identification of a management team to execute the action plan, (3) the process, responsibilities, and triggers for invoking the contingency funding plan, and (4) the decision-making process during the identified liquidity stress events and the process for executing the action plan's contingency measures. In addition, the proposal sets out reporting and communication requirements to facilitate a systemically important insurance company's implementation of its action plan during an identified liquidity stress event.

    The proposal would require that a systemically important insurance company periodically test (1) the components of its contingency funding plan to assess its reliability during liquidity stress events, (2) the operational elements of the contingency funding plan, and (3) the methods the company would use to access alternative funding sources to determine whether those sources would be available when needed. The tests required by the proposal would focus on the operational aspects of the contingency funding plan. This can often be done via “table-top” or “war-room” type exercises. In some cases, the testing would also require actual liquidation of assets in the buffer periodically as part of the exercise. This can be critical in demonstrating treasury control over the assets and an ability to convert the assets into cash. With proper planning, this can be done in a way that does not send a distress signal to the marketplace.

    Market circumstances and the composition of a systemically important insurance company's business and product mix change over time. These types of changes could affect the effectiveness of a systemically important insurance company's contingency funding plan. To ensure that the contingency funding plan remains useful and instructive, the proposal would require a systemically important insurance company to update its contingency funding plan at least annually, and more frequently when changes to market and idiosyncratic conditions warrant.

    Question 10: The Board invites comment on whether the above requirements for a contingency funding plan are appropriate for systemically important insurance companies. What alternative approaches to the contingency funding requirements outlined above should the Board consider?

    Question 11: Should the proposed rule allow systemically important insurance companies to plan for any delay or stay of payments to policyholders or other counterparties within their contingency funding plans? Why or why not?

    Question 12: What specific information should a systemically important insurance company be required to include in its action plan to describe the strategies that the company would use to respond to liquidity shortfalls for identified liquidity stress events?

    E. Collateral, Legal Entity, and Intraday Liquidity Risk Monitoring

    The proposal would require a systemically important insurance company to establish and maintain procedures for monitoring collateral, legal entity, and intraday liquidity risk. Robust monitoring of collateral availability, legal entity level liquidity, and intraday liquidity risk triggers contribute to effective and appropriate management of potential or evolving liquidity stress events.

    Under the proposal, the systemically important insurance company would be required to establish and maintain procedures to monitor assets that have been, or are available to be, pledged as collateral in connection with transactions to which it or its affiliates are counterparties. The policies and procedures would include the frequency in which a systemically important insurance company calculates its collateral positions, requirements for a company to monitor the levels of unencumbered assets (as discussed in section III.F.2, below) available to be pledged and shifts in a company's funding patterns, and requirements for a company to track operational and timing requirements associated with accessing collateral at its physical location.

    A systemically important insurance company would also be required under the proposal to establish and maintain policies and procedures for monitoring and controlling liquidity risk exposures and funding needs within and across significant legal entities, currencies, and business lines, taking into account legal and regulatory restrictions on the transfer of liquidity among legal entities.

    The proposal would require a systemically important insurance company to maintain policies and procedures for monitoring the intraday liquidity risk exposure of the company, as applicable to its business, including obligations that must be settled at a specific time within the day or where intraday events could affect a systemically important insurance company's liquidity positions in a material and adverse manner. For instance, the company should have procedures in place to monitor the risk that an intraday movement in equity prices or the price of hedge instruments could materially affect the company's liquidity position. If applicable, these procedures would be required to address, among other things, how the systemically important insurance company will prioritize payments and derivative transactions to settle critical obligations and effectively hedge its risks.

    Question 13: The Board invites comments on whether there are specific activities that, if carried out by a systemically important insurance company, should result in a requirement that the company engage in intraday liquidity monitoring?

    F. Liquidity Stress-Testing and Buffer Requirements

    To reduce the risk of a systemically important insurance company's failure due to adverse liquidity conditions, the proposal would require a systemically important insurance company to conduct rigorous and regular stress testing and scenario analysis that incorporate comprehensive information about its funding position under both normal circumstances, when regular sources of liquidity are readily available, and adverse conditions, when liquidity sources may be limited or severely constrained. The purpose of the proposed rule's liquidity stress testing and buffer requirements would be to ensure that the holding company (or another entity within the consolidated organization that is not subject to transfer restrictions) has the ability to transfer liquid assets to a legal entity within the consolidated organization that has a liquidity need so that a liquidity crisis can be avoided.

    1. Liquidity Stress-Testing Requirement

    Under the proposed rule, a systemically important insurance company would be required to conduct liquidity stress tests that, at a minimum, involve macroeconomic, sector-wide, and idiosyncratic events (for example, including natural and man-made catastrophes) affecting the firm's cash flows, liquidity position, profitability, and solvency. The liquidity stress tests should span the different types of liquidity events that a systemically important insurance company could face. This includes both a fast-moving scenario in which an event triggers many withdrawal requests and collateral calls as well as a more sustained scenario where the systemically important insurance company's liquidity deteriorates slowly over the course of a year or longer. In conducting its liquidity stress tests, a systemically important insurance company would be required under the proposal to take into account its current liquidity condition, risks, exposures, strategies, and activities, as well as its balance sheet exposures, off-balance sheet exposures, size, risk profile, complexity, business lines, organizational structure, and other characteristics that affect its liquidity risk profile. The proposal would require a systemically important insurance company to conduct its liquidity stress tests monthly, or more frequently as required by the Board.

    In conducting its liquidity stress tests, a systemically important insurance company would be required to address the potential direct adverse effect of associated market disruptions on the company and incorporate the potential actions of counterparties, policyholders, and other market participants experiencing liquidity stresses that could adversely affect the company.

    As explained above, for purposes of the proposed rule, liquidity risk would encompass risks relating to collateral posting requirements. By virtue of their hedging and non-insurance operations, insurers can have large and directional derivative positions with associated collateral requirements. A systemically important insurance company would be required by the proposal to account for such hedges in its liquidity stress testing to ensure that it would have sufficient sources of assets available for posting.

    Effective liquidity stress testing should be conducted over a variety of different time horizons to capture rapidly developing events and other conditions and outcomes that may materialize in the near or long term. While some types of stresses can emerge quickly for systemically important insurance companies, such as collateral calls on derivatives positions, many insurance stresses take more time to develop and provide a slower draw on cash and funds relative to the stresses that affect other financial institutions. For instance, while a natural catastrophe might cause a large number of claims seeking reimbursement for property damage, these claims will typically be paid over a several year period as the properties are rebuilt and many claims are litigated. To ensure that a systemically important insurance company's stress testing captures such events, conditions, and outcomes, the proposed rule would require that a systemically important insurance company's liquidity stress scenarios use a minimum of four time horizons: 7 days, 30 days, 90 days, and one year. The proposal would also require systemically important insurance companies to include any other planning horizons that are relevant to its liquidity risk profile.

    Under the proposal, a systemically important insurance company would be required to incorporate certain assumptions designed to ensure that its liquidity stress tests provide relevant information to support the establishment of the liquidity buffer. For stress tests less than the 90-day period used to set the liquidity buffer, cash-flow sources could not include any sales of assets that are not eligible for inclusion in the liquidity buffer, as defined below. Additionally, cash-flow sources should not include borrowings from sources such as lines of credit or the Federal Home Loan Bank. While these can provide valuable sources of liquidity, the allowance of off-balance sheet funding to decrease the liquidity buffer requirement would encourage firms to place undue reliance on these transactions, which may not be available when needed in times of stress. Additionally, the borrowings could serve to exacerbate systemic risk by spreading risk to other significant financial institutions. Systemically important insurance companies could incorporate into the stress tests other cash-flow sources, including future premiums, and would be expected to make conservative assumptions that are consistent with the stress scenario regarding the availability of these sources over the planning horizon.

    In all liquidity stress tests, the proposal would require systemically important insurance companies to appropriately address assets in restricted accounts such as those in legally-insulated separate accounts and in any closed block.28 Changes in the value of these assets can affect the rest of the insurer's balance sheet through guarantees and hedging programs. Additionally, sales or purchases of large amounts of assets in these accounts can affect the markets more broadly. Consequently, separate account assets and closed block assets could be included as cash-flow sources only in proportion to the cash flow needs in these same accounts. Separate account assets have first priority to meet separate account commitments and would not be available to meet general account liquidity needs.

    28 Closed blocks are discrete pools of assets that are set aside to support the dividend expectations of participating policyholders from the periods prior to demutualization. Typically, changes of their values would be largely offset by future changes in the dividend rates on these participating policies.

    The proposed rule would require a systemically important insurance company to impose a discount to the fair market value of an asset that is used as a cash-flow source to offset projected funding needs in order to help account for credit risk and market volatility of the asset when there is market stress. The discounts would be required to appropriately reflect differences in credit and market volatilities across asset types. The proposed rule would require that sources of funding used to generate cash to offset projected funding needs be sufficiently diversified throughout each stress test time horizon.

    The proposed rule further provides that liquidity stress testing must be tailored to, and provide sufficient detail to reflect, a systemically important insurance company's capital structure, risk profile, complexity, activities, size, and other appropriate risk-related factors. This requirement is intended to ensure that the proposed liquidity stress testing is tied directly to a systemically important insurance company's business profile and the regulatory environment in which the company operates; provides for the appropriate level of aggregation; captures all appropriate risk drivers, including internal and external influences; and incorporates other key considerations that may affect the company's liquidity position. In addition, a systemically important insurance company's liquidity stress testing scenarios should appropriately capture limitations on the transfer of funds.

    The proposed rule would not allow a systemically important insurance company to assume for the purposes of stress testing that the company would delay payments under insurance contracts. Although many insurance contracts allow insurers to defer payments by up to six months at the election of either the company or their insurance regulator, the proposal would not allow firms to assume such deferrals in liquidity stress testing. Crediting stays would be inconsistent with preventing the failure or material financial distress of a systemically important insurance company. Stays are measures of last resort that systemically important insurance companies would be very hesitant to invoke for reputational reasons. Because of this, assuming claims payments would be delayed also may not be realistic. Additionally, a stay by a systemically important insurance company could have substantial adverse systemic implications.

    The proposed rule would impose various governance requirements related to a systemically important insurance company's liquidity stress testing. First, a systemically important insurance company would be required to establish and maintain certain policies and procedures governing its liquidity stress testing practices, methodologies, and assumptions. Second, a systemically important insurance company would be required to establish and maintain a system of controls and oversight to ensure that its liquidity stress testing processes are effective, including by ensuring that each stress test appropriately incorporates conservative assumptions around its stress test scenarios and the other elements of the stress test process. In addition, the proposal would require that the assumptions be approved by the chief risk officer and subject to review by the independent review function. Third, the proposed rule would require a systemically important insurance company to maintain management information systems and data processes sufficient to enable it to collect, sort, and aggregate data and other information related to liquidity stress testing in an effective and reliable manner.

    Question 14: Are the proposed stress testing horizons ranging from seven days to one year appropriate?

    Question 15: How often should systemically important insurance companies be required to conduct stress tests? What are the costs and benefits of such a frequency?

    Question 16: What changes, if any, should be made to the definition of available cash-flow sources for the liquidity stress tests? How should the proposed standard treat separate account and closed block assets?

    Question 17: In what scenario, if any, would delaying payments to policyholders be effective in allowing a systemically important insurance company to continue operating as a going concern without adverse impact to the company's reputation, ability to attract and retain business, and cash flows? Should systemically important insurance companies be allowed to assume that they would delay payments to policyholders in liquidity stress testing (including for purposes of calculating the liquidity buffer requirement described below)? If so, under which scenarios and planning horizons would this be appropriate and what documentation, planning, and other requirements should be placed around this? Are there historical data to support an alternative approach to the one contained in the proposal?

    Question 18: What other changes, if any, should be made to the proposed liquidity stress-testing requirements (including the stress scenario requirements and required assumptions) to ensure that analyses of stress testing will provide useful information for the management of a systemically important insurance company's liquidity risk? What alternatives to the proposed liquidity stress-testing requirements, including the stress scenario requirements and required assumptions, should the Board consider? What additional parameters for the liquidity stress tests should the Board consider defining?

    2. Liquidity Buffer Requirement

    The proposed rule would require a systemically important insurance company to maintain a liquidity buffer sufficient to meet net cash outflows for 90 days over the range of liquidity stress scenarios used in the internal stress testing. Although the Board requires large bank holding companies to use a 30-day period for the Dodd Frank Act section 165 liquidity buffer requirement under the Board's Regulation YY, this proposed 90-day period for systemically important insurance companies is consistent with the generally longer-term nature of insurance liabilities. The 90-day period represents an intermediate view between the length of a fast-moving liquidity scenario that transpires quickly over a month or less, and the length of a persistent liquidity scenario that could take longer than a year to resolve.

    For the purposes of calculating the required buffer, the proposal would exclude intragroup transactions. Including intragroup outflows within the buffer calculation would result in double counting many transactions. For instance, if intragroup transactions were included when calculating the size of the buffer, a systemically important insurance company that uses a single legal entity to enter into derivative transactions for hedging could be penalized. Such a company would have to hold buffer assets not only for the derivative transaction with a third party, but also for any offsetting intra-group transactions that transfer the benefits of this hedge back to the legal entity with the hedged item. To account for the liquidity risks of intragroup transactions, this proposal instead places limitations on where the buffer can be held.

    The proposal would limit the type of assets that may be included in the buffer to highly liquid assets that are unencumbered. Limitation of the buffer to highly liquid assets would ensure that the assets in the liquidity buffer can be converted to cash over a 90-day period with little or no loss of value. The proposal's definition of highly liquid assets is tailored to reflect the assets generally held by systemically important insurance companies and the 90-day stress test period proposed for a systemically important insurance company. Over a 90-day time period, the Board would expect that a wider variety of assets could be effectively liquidated than in a shorter period (e.g., 30 days).

    For purposes of the proposed rule, highly liquid assets would include a range of assets, subject to the additional limitations discussed further below. Highly liquid assets would include securities backed by the full faith and credit of the U.S. government, and securities issued or guaranteed by a U.S. government sponsored enterprise if they are investment-grade as defined by 12 CFR part 1 and the claim is senior to preferred stock. Highly liquid assets would include securities of sovereign entities outside of the U.S. as well as some international organizations, including the Bank for International Settlements, the International Monetary Fund, and the European Central Bank, if the security would have a risk weight below 20 percent under 12 CFR part 217 or the security is issued by a sovereign entity in its own currency and the systemically important insurance company holds the security in order to meet its stressed net cash outflows in the sovereign's jurisdiction.

    Investment-grade corporate debt would also be eligible if the issuer's obligations have a proven record as reliable sources of liquidity during stressed market conditions. In addition, highly liquid assets would include publicly traded common equity shares if they are included in the Russell 1000 Index, issued by an entity whose publicly traded common equity shares have a proven record as a reliable source of liquidity during stressed market conditions, and, if held by a depository institution, were not acquired in satisfaction of a debt previously contracted. Investment-grade general obligation securities issued or guaranteed by public sector entities would be eligible under the same limitations as corporate debt.

    To be included as highly liquid assets, all assets other than securities issued or guaranteed by the U.S. Treasury would have to be liquid and readily-marketable. To be liquid and readily marketable under the proposal, the security must be traded in an active secondary market with more than two committed market makers. There must also be a large number of non-market maker participants on both the buying and selling sides of the transactions and there must also be timely and observable market prices. Further, trading volume must be high. These requirements would help ensure that the included assets could be quickly converted to cash.

    Because of the concerns about wrong-way risk that correlates with the broader economy and exacerbates stress and because of the potential for increased systemic risk due to counterparty exposures, most instruments issued by financial institutions would be excluded from the definition of highly liquid assets. Bonds from banks or insurance companies may not be included within the buffer. Similarly bank deposits would not be eligible because of potential contagion. If a systemically important insurance company were to experience liquidity stress and withdraw its bank deposits, the stress event could be spread to other parts of the financial system as banks may be forced to liquidate assets in order to honor the withdrawals.

    In addition to the enumerated assets, the proposal includes criteria that could be used to identify other assets to be included in the buffer as highly liquid assets. Specifically, the proposed definition of highly liquid assets includes any other asset that a systemically important insurance company demonstrates to the satisfaction of the Board (1) has low credit risk and low market risk, (2) is liquid and readily-marketable, and (3) is a type of asset that investors historically have purchased in periods of financial market distress during which market liquidity has been impaired.

    The proposal also would limit the type of assets in the liquidity buffer to assets that are unencumbered so as to be readily available at all times to meet a systemically important insurance company's liquidity needs. Under the proposed rule, unencumbered would be defined to mean an asset that is (1) free of legal, regulatory, contractual, and other restrictions on the ability of a systemically important insurance company promptly to liquidate, sell, or transfer the asset, and (2) not pledged or used to secure or provide credit enhancement to any transaction.

    Because of intercompany restrictions on the transfer of funds, the proposal would limit where a systemically important insurance company can hold assets in the liquidity buffer. Assets held at regulated entities could be included in the buffer up to the amount of their net cash outflows as calculated under the internal liquidity stress tests plus any additional amounts that would be available for transfer to the top-tier holding company during times of stress without statutory, regulatory, contractual, or supervisory restrictions. The proposal would also require that the top-tier holding company hold an amount of highly liquid assets sufficient to cover the sum of all stand-alone material entity net liquidity deficits. The stand-alone net liquidity deficit of each material entity would be calculated as that entity's amount of net stressed outflows over a 90-day planning horizon less the highly liquid assets held at the material entity. For the purposes of evaluating liquidity deficits of material entities, systemically important insurance companies would be required to treat inter-affiliate exposures in the same manner as third-party exposures.

    To account for deteriorations in asset valuations when there is market stress, the proposed rule also would require a systemically important insurance company to impose a discount to the fair market value of an asset included in the liquidity buffer to reflect the credit risk and market volatility of the asset. Discounts relative to fair market value would be expected to appropriately reflect the 90-day forecast period used to calculate the buffer. Longer periods allow firms more time to liquidate assets strategically to minimize losses.

    In addition, to ensure that the liquidity buffer is not concentrated in a particular type of highly liquid assets, the proposed rule provides that the pool of assets included in the liquidity buffer must be sufficiently diversified by instrument type, counterparties, geographic market, and other liquidity risk identifiers.

    Question 19: Is 90 days the right planning horizon for calculation of the buffer? Why or why not?

    Question 20: Do the proposed rule's stress testing and liquidity buffer requirements appropriately capture restrictions on the transferability of funds between legal entities within a consolidated organization? Why or why not?

    Question 21: The Board invites comment on all aspects of the proposed definition of “highly liquid assets”. Does the definition appropriately reflect the range of assets that an insurer could use to meet cash outflows over the extended 90-day time horizon?

    Question 22: Should the board include specific requirements that specify when an asset can be considered a source of liquidity during stress (e.g., less than a 20 percent drop in price within 30 days)? If so, what should those requirements be?

    Question 23: Should bank deposits be eligible as highly liquid assets? Why or why not?

    Question 24: What changes, if any, should be made to the proposal's guidance concerning the discounting of assets relative to their fair value? How should these discounts vary based on the length of the stress test's planning horizon?

    Question 25: What changes, if any, should the Board make to the proposed definition of unencumbered to ensure that assets in the liquidity buffer will be readily available at all times to meet a systemically important insurance company's liquidity needs?

    Question 26: The Board requests comment on all aspects of the proposed liquidity risk-management standard. What alternative approaches to liquidity risk management should the Board consider? Are the liquidity risk-management requirements of this proposal too specific or too narrowly defined?

    IV. Transition Arrangements and Ongoing Compliance

    To provide for reasonable time frames for systemically important insurance companies to develop and implement procedures, policies, and reporting, the Board is proposing to provide meaningful phase-in periods for these enhanced prudential standards. A company that is a systemically important insurance company on the effective date of the final rule would be required to comply with the corporate governance and risk-management standard and the liquidity risk-management standard of the proposed rule beginning on the first day of the fifth quarter following the effective date of the proposal. While the Board does not anticipate that, if the rule is adopted as proposed, systemically important insurance companies would be required to make extensive changes to their structures or risk governance frameworks, outside of certain improvements that the companies are already planning to implement, the five-quarter period would ensure that systemically important insurance companies would have at least one opportunity to make any needed changes at the board of directors level through a proxy vote. Systemically important insurance companies would be encouraged to comply earlier, if possible. For the liquidity risk-management standard, the five-quarter phase-in period would balance the need for this liquidity standard with the Board's expectation that more work would be required for the systemically important insurance companies to comprehensively project cash flows in a manner that supports the proposal's stress-testing requirement. A company that becomes a systemically important insurance company after the effective date of the proposed rule would be required to comply with the corporate governance and risk-management standard and the liquidity risk-management standard no later than the first day of the fifth quarter following the date on which the Council determined that the company should be supervised by the Board.

    Question 27: Are the proposed transition measures and compliance dates appropriate? What aspects of the proposed rule present implementation challenges and why? The Board invites comments on the nature and impact of these challenges and whether the Board should consider implementing transitional arrangements in the rule to address these challenges.

    V. Impact Assessment

    In developing this proposal, the Board considered a variety of alternatives and considered an initial balancing of costs and benefits of the proposal. Based on the information currently available to the Board, the Board believes that the benefits of the proposal outweigh the relatively modest costs of the proposal. The Board notes that a number of the expected costs and benefits from the proposal, while real, are very difficult to measure or quantify. The Board invites comment and information regarding various alternatives, as well as regarding the costs and benefits of the alternatives and the Board's proposal.

    The primary benefits of this proposal would be the results of improvement in the management and resiliency of affected companies that reduce the likelihood that a systemically important insurance company would fail or experience material financial distress. These improvements may also result in increased efficiencies at systemically important insurance companies through improvements in the identification of risks and resulting reductions in losses and costs of operation.

    The systemically important insurance companies covered by this proposal are large, complex financial firms that the Council has determined the failure of which would likely cause risk to the financial stability of the United States. Benefits of a reduction in the probability of failure of one of these firms include avoiding: (1) The costs to the economy from the disruption of key markets or the creation of significant losses or funding problems for other firms with holdings similar to a systemically important insurance company; (2) the cost of such a failure to policyholders through lost payments and lost coverage; (3) the cost of an insurance failure to taxpayers and other insurers, who act as guarantors for large portions of a systemically important insurance company's obligations; and (4) the cost of a failure to a systemically important insurance company's creditors.

    A. Analysis of Potential Costs 1. Initial and Ongoing Costs To Comply

    The corporate governance and risk-management provisions of the proposal are expected to have only modest initial and ongoing costs for the affected companies. Under the proposal, systemically important insurance companies would be required to maintain a risk committee of the board of directors that approves and periodically reviews the risk-management policies of the systemically important insurance company's global operations and oversees the operation of the systemically important insurance company's global risk-management framework. The systemically important insurance companies currently have board-level engagement on key risks, and any structural modifications to establish and operate a stand-alone risk committee of the board of the directors are likely to be modest.

    Under the proposal, a systemically important insurance company's global risk-management framework would be required to include policies and procedures establishing risk-management governance, risk-management procedures, and risk control infrastructure for its global operations, as well as processes and systems for implementing and monitoring compliance with such procedures; identifying and reporting risks and risk-management deficiencies; establishing managerial and employee responsibility for risk management; ensuring the independence of the risk-management function; and integrating risk-management and associated controls with management goals and its compensation structure for its global operations. The systemically important insurance companies currently have both risk-management frameworks and policies already in place. They have already invested significant resources in building up their risk-management frameworks in recent years. The Board expects that these frameworks, along with the companies' planned improvements, would largely comply with the proposed standards. The proposal is designed to ensure that these policies and procedures are maintained and are developed as the risks within the firm change. The primary costs of maintaining and adapting these policies and procedures would be from the opportunity cost of management's time to make the changes to the framework, as well as the costs of establishing or improving new management information systems to assure the timely presentation of information to these senior level officials. These costs might also include additional staffing to administer the global risk-management framework.

    Under the proposal, systemically important insurance companies also would be required to have a chief risk officer and a chief actuary. The systemically important insurance companies currently have both a chief risk officer and a chief actuary or co-chief actuaries. The proposal may require the companies to modify their reporting structures and compensation to ensure that the positions have sufficient stature and independence from individual profit centers in order to comply with the proposal. The costs associated with such changes could include, but may not be limited to, ongoing payroll and benefit costs and the opportunity cost of the time spent making the necessary changes. These costs are expected to be minimal.

    Under the proposed liquidity risk-management standard, systemically important insurance companies would be required to meet key internal control requirements with respect to liquidity risk management. The companies currently have existing processes in place to oversee liquidity risk. These processes, along with planned improvements, would largely comply with the liquidity risk-management standard's internal control requirements. Some additional changes may be required pertaining to new product approval and to ensure periodic review of all significant products and activities for liquidity risk features. These costs are expected to be relatively small.

    The proposed rule would also require systemically important insurance companies to generate comprehensive cash flow projections. Both companies have procedures in place to generate cash-flow projections. Additional work may be needed to ensure that all cash flows, including those in unregulated or run-off entities, are included within the projections, and to ensure that the cash-flow projections are timely and updated at the appropriate frequency. The additional frequency of updating might require systemically important insurance companies to either hire additional staff to run these projections or to build or buy new systems that can produce these comprehensive forecasts in a timely and efficient manner. Because these firms already have in place basic infrastructure to make these projections, any marginal costs to meet the minimum requirements under the proposal are expected to be relatively modest.

    The proposed rule would also require systemically important insurance companies to maintain a contingency funding plan. Both systemically important insurance companies have plans in place to respond to a liquidity crisis, and both are working to develop these plans further. Some additional work on these plans may be required to meet the requirements of the proposed rule, such as quantitatively assessing cash-flow needs and sources across legal entities.

    The proposed rule also would require systemically important insurance companies to conduct liquidity stress tests and require the systemically important insurance companies to maintain liquid assets sufficient to meet net cash outflows for 90 days over the range of liquidity stress scenarios used in the internal stress tests. Both of the systemically important insurance companies have systems in place to project the company's liquidity position under stressed conditions. However, the proposal may cause the systemically important insurance companies to update these systems to facilitate monthly testing and ensure that the scenarios include all exposures and entities within the systemically important insurance company. The costs associated with these improvements are expected to be modest within the context of the organizations and could include, but may not be limited to, the costs to recruit and hire staff, including ongoing payroll and benefits costs, and the costs of development and implementation of management information systems with appropriate data to support analysis and reporting on a monthly frequency.

    In addition, systemically important insurance companies may need to make balance sheet adjustments in order to come into and maintain compliance with the proposed liquidity risk-management requirements, if adopted as proposed. While both systemically important insurance companies currently appear to maintain an adequate amount of liquidity on a consolidated basis, some movement of funds between legal entities may be required to provide appropriate responsiveness in times of stress.

    2. Impact on Premiums and Fees

    The initial and ongoing costs of complying with the standard, if adopted as proposed, could affect the premiums and fees that the systemically important insurance companies charge. Insurance products are priced to allow insurers to recover their costs and earn a fair rate of return on their capital. In the long run, all costs of providing a policy are borne by policyholders.

    Because the expected costs associated with implementing the proposal, if adopted, are not expected to be material within the context of the institutions' existing budgets, there is not expected to be a material change in the pricing of systemically important insurance companies' products from the proposed standards, if adopted as proposed. Moreover, the better identification and management of risk that is expected to result from the proposal may lead to improved efficiencies, fewer losses, and lower costs in the long term, which may offset the effects of the costs of compliance on premiums.

    3. Reduced Financial Intermediation

    If premiums or fees increase on some or all products, it could discourage some potential customers from purchasing these products. However, the possibility of reduced financial intermediation or economic output in the United States related to the proposed rule's corporate governance and risk-management standard and liquidity risk-management standard appears unlikely.

    B. Analysis of Potential Benefits

    Based on an initial assessment of available information, the benefits of the proposed standards are expected to outweigh the costs. Most significantly, the intent of the proposed rule is to reduce the probability of a systemically important insurance company failing or experiencing material financial distress. Even small changes in the probability of a systemically important firm failing can confer large expected benefits because of the enormous cost of financial crises. Additionally, the proposal would have an ancillary benefit of facilitating an orderly resolution of a systemically important insurance company, and could increase consumer confidence in the companies. Moreover, as explained below, improved risk management may improve efficiency by reducing losses and costs in the long term.

    1. Benefits From a Reduction in the Likelihood That a Systemically Important Insurance Company Would Fail or Experience Material Financial Distress

    This proposal is intended to reduce the risk that a systemically important insurance company would experience material financial distress or fail. A reduction of this probability carries numerous direct and indirect benefits.

    The most important benefit from a reduction in the probability of default of a systemically important insurance company is a decreased potential for a potential negative impact on the United States economy caused by the failure or material financial distress of a systemically important insurance company. The Council has determined that material financial distress at each of the systemically important insurance companies could cause an impairment of financial intermediation or of financial market functioning that would be sufficiently severe to inflict significant damage on the broader economy. A reduction in the probability of failure or material financial distress at both systemically important insurance companies would promote financial stability and concomitantly materially reduce the probability that a financial crisis would occur in any given year. The proposed rule would therefore advance a key objective of the Dodd-Frank Act and help protect the American economy from the substantial potential losses associated with a higher probability of financial crises.

    In addition to the benefits to the broader economy, a reduction in a systemically important insurance company's default probability benefits its counterparties. The majority of funding for systemically important insurance companies comes from policyholders. Some of these policyholders would bear losses if the company were to fail. These losses can take the form of reduced payment for claims, reduced amounts available for withdrawal from policyholder accounts, or long delays.

    The overall costs of these losses to policyholders extend beyond just their dollar value. Policyholders purchase insurance policies because they provide money when it is most needed. Insurance policies can replace lost wages when a policyholder is disabled or help a policyholder afford shelter after a natural catastrophe destroys his or her home and possessions. Other policyholders might not yet have experienced a loss event, but could be unable to obtain new coverage in the event a systemically important insurance company fails. For instance, an elderly policyholder who purchased a whole life contract many years ago would likely have difficulty obtaining a replacement policy.

    Reducing the probability of a systemically important insurance company's failure or distress decreases the expected costs to policyholders, taxpayers, other counterparties, other insurance companies, and the financial system generally.

    The proposal is also expected to benefit other creditors of systemically important insurance companies. In the event of a failure, the lenders and general creditors of a company also experience losses. While it is not the primary goal of this proposed regulation to protect these parties, they could potentially benefit.

    The savings from a reduced probability of default would also have indirect benefits. They could also translate into lower borrowing costs for systemically important insurance companies. The lower costs could also affect insurance premiums. If systemically important insurance companies expect lower guaranty fund assessment costs, these savings could be passed on to policyholders in the form of lower premiums and fees. These savings are, however, unlikely to be material.

    2. A Reduction in the Impact of a Firm's Failure or Distress on the Economy

    While the primary benefit of the proposed rule would be a reduction in the probability of a firm failing or experiencing material financial distress, the proposed rule is also expected to produce benefits in a resolution of a systemically important insurance company. Liquidity is valuable in resolutions, and the restrictions on the liquidity buffer that require the buffer to be held at the holding company to be down-streamed, could facilitate a variety of strategies for an orderly resolution.

    3. Improved Efficiencies Resulting From Better Risk Management

    The proposed rule may result in efficiencies at systemically important insurance companies through improved risk-management practices. The proposed rule is expected to improve systemically important insurance companies' internal controls and identification and management of risks that may arise through their activities and investments. For example, the increased internal controls and liquidity stress-testing requirements could result in a systemically important insurance company discovering that a product's liquidity risks are different than it previously estimated and thus result in the systemically important insurance company being able to price that product in a way that more accurately reflects its risks. If systemically important insurance companies are better able to manage risk, then over the long term, the proposed rule may result in decreased losses and related costs to systemically important insurance companies.

    Question 28: The Board invites comment on all aspects of the foregoing evaluation of the costs and benefits of the proposed rule. Are there additional costs or benefits that the Board should consider? Would the magnitude of costs or benefits be different than as described above?

    VI. Administrative Law Matters A. Solicitation of Comments on the Use of Plain Language

    Section 722 of the Gramm-Leach-Bliley Act (Pub. L. 106-102, 113 Stat. 1338, 1471, 12 U.S.C. 4809) requires the Federal banking agencies to use plain language in all proposed and final rules published after January 1, 2000. The Board has sought to present the proposed rule in a simple and straightforward manner, and invites comment on the use of plain language.

    B. Paperwork Reduction Act Analysis

    Certain provisions of the proposed rule contain “collection of information” requirements within the meaning of the Paperwork Reduction Act (PRA) of 1995 (44 U.S.C. 3501-3521). In accordance with the requirements of the PRA, the Board may not conduct or sponsor, and the respondent is not required to respond to, an information collection unless it displays a currently valid Office of Management and Budget (OMB) control number. The OMB control number is 7100-NEW. The Board reviewed the proposed rule under the authority delegated to the Board by the OMB.

    The proposed rule contains requirements subject to the PRA. The recordkeeping requirements are found in sections 252.164(e)(3), 252.164(f), 252.164(h), and 252.165(a)(7). These information collection requirements would be implemented pursuant to section 165 of the Dodd-Frank Act for systemically important insurance companies.

    Comments are invited on:

    (a) Whether the collections of information are necessary for the proper performance of the Board's functions, including whether the information has practical utility;

    (b) The accuracy of the Board's estimate of the burden of the information collections, including the validity of the methodology and assumptions used;

    (c) Ways to enhance the quality, utility, and clarity of the information to be collected;

    (d) Ways to minimize the burden of the information collections on respondents, 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 provide information.

    All comments will become a matter of public record. Comments on aspects of this notice that may affect reporting, recordkeeping, or disclosure requirements and burden estimates should be sent to the addresses listed in the ADDRESSES section. A copy of the comments may also be submitted to the OMB desk officer: By mail to U.S. Office of Management and Budget, 725 17th Street NW., #10235, Washington, DC 20503 or by facsimile to 202-395-5806, Attention, Federal Reserve Desk Officer.

    Proposed Information Collection

    Title of Information Collection: Recordkeeping Requirements Associated with Enhanced Prudential Standards (Regulation YY).

    Agency Form Number: Reg YY-1.

    OMB Control Number: 7100—NEW.

    Frequency of Response: Annual.

    Affected Public: Businesses or other for-profit.

    Respondents: Systemically important insurance companies.

    Abstract: Section 165 of the Dodd-Frank Act requires the Board to implement enhanced prudential standards for nonbank financial companies that the Council has determined should be supervised by the Board. Section 165 of the Dodd-Frank Act also permits the Board to establish such other prudential standards for such companies as the Board determines are appropriate.

    Current Actions: Pursuant to section 165 of the Dodd-Frank Act, the Board is proposing the application of enhanced prudential standards to certain nonbank financial companies that the Council has determined should be supervised by the Board. The Board is proposing corporate governance, risk-management, and liquidity risk-management standards that are tailored to the business models, capital structures, risk profiles, and systemic footprints of the nonbank financial companies with significant insurance activities.

    Section 252.164(e)(3) would require a systemically important insurance company to adequately document its methodology for making cash flow projections and the included assumptions.

    Section 252.164(f) would require a systemically important insurance company to establish and maintain a contingency funding plan that sets out the company's strategies for addressing liquidity needs during liquidity stress events and describes the steps that should be taken to ensure that the systemically important insurance company's sources of liquidity are sufficient to fund its normal operating requirements under stress events. To operate normally, a firm must have sufficient funding to pay obligations in the ordinary course as they become due and meet all solvency requirements for the writing of new and renewal policies. The contingency funding plan must be commensurate with the company's capital structure, risk profile, complexity, activities, size, and established liquidity risk tolerance. The company must update the contingency funding plan at least annually, and when changes to market and idiosyncratic conditions warrant. The contingency funding plan must include specified quantitative elements, an event management process that sets out the systemically important insurance company's procedures for managing liquidity during identified liquidity stress events, and procedures for monitoring emerging liquidity stress events. The procedures must identify early warning indicators that are tailored to the company's capital structure, risk profile, complexity, activities, and size.

    Section 252.164(h)(1) would require a systemically important insurance company to establish and maintain policies and procedures to monitor assets that have been, or are available to be, pledged as collateral in connection with transactions to which it or its affiliates are counterparties and sets forth minimum standards for those procedures.

    Section 252.164(h)(2) would require a systemically important insurance company to establish and maintain procedures for monitoring and controlling liquidity risk exposures and funding needs within and across significant legal entities, currencies, and business lines, taking into account legal and regulatory restrictions on the transfer of liquidity between legal entities.

    Section 252.164(h)(3) would require a systemically important insurance company to establish and maintain procedures for monitoring intraday liquidity risk exposure of the systemically important insurance company if necessary for its business. These procedures must address how the management of the systemically important insurance company will (1) monitor and measure expected daily gross liquidity inflows and outflows, (2) identify and prioritize time-specific obligations so that the systemically important insurance company can meet these obligations as expected and settle less critical obligations as soon as possible, (3) coordinate the purchase and sale of derivatives so as to maximize the effectiveness of their hedging programs, (4) consider the amounts of collateral and liquidity needed to meet obligations when assessing the systemically important insurance company's overall liquidity needs, and (5) where necessary, manage and transfer collateral to obtain intraday credit.

    Section 252.35(a)(7) would require a systemically important insurance company to establish and maintain policies and procedures governing its liquidity stress testing practices, methodologies, and assumptions that provide for the incorporation of the results of liquidity stress tests in future stress testing and for the enhancement of stress testing practices over time. The systemically important insurance company would establish and maintain a system of controls and oversight that is designed to ensure that its liquidity stress testing processes are effective in meeting the final rule's stress-testing requirements. The systemically important insurance company would maintain management information systems and data processes sufficient to enable it to effectively and reliably collect, sort, and aggregate data and other information related to liquidity stress testing.

    Estimated Paperwork Burden

    Number of Respondents: 2 systemically important insurance companies.

    Estimated Burden per Response: 200 hours (Initial set-up 160 hours).

    Estimated Annual Burden: 720 hours (320 hours for initial set-up and 400 hours for ongoing compliance).

    C. Regulatory Flexibility Act Analysis

    In accordance with section 3(a) of the Regulatory Flexibility Act 29 (RFA), the Board is publishing an initial regulatory flexibility analysis of the proposed rule. The RFA requires an agency either to provide an initial regulatory flexibility analysis with a proposed rule for which a general notice of proposed rulemaking is required or to certify that the proposed rule will not have a significant economic impact on a substantial number of small entities. Based on its analysis and for the reasons stated below, the Board believes that this proposed rule will not have a significant economic impact on a substantial number of small entities. Nevertheless, the Board is publishing an initial regulatory flexibility analysis. A final regulatory flexibility analysis will be conducted after comments received during the public comment period have been considered.

    29 5 U.S.C. 601 et seq.

    In accordance with section 165 of the Dodd-Frank Act, the Board is proposing to adopt Regulation YY (12 CFR 252 et seq.) to establish enhanced prudential standards for systemically important insurance companies.30 The enhanced standards include liquidity standards and requirements for overall risk-management (including establishing a risk committee) for companies that the Council has determined pose a grave threat to financial stability.

    30See 12 U.S.C. 5365 and 5366.

    Under Small Business Administration (SBA) regulations, the finance and insurance sector includes direct life insurance carriers and direct property and casualty insurance carriers, which generally are considered “small” if a life insurance carrier has assets of $38.5 million or less or if a property and casualty insurance carrier has less than 1,500 employees.31 The Board believes that the finance and insurance sector constitutes a reasonable universe of firms for these purposes because such firms generally engage in activities that are financial in nature. Consequently, systemically important insurance companies with asset sizes of $38.5 million or less if such an entity is a life insurance carrier and less than 1,500 employees if such an entity is a property and casualty insurance carrier are small entities for purposes of the RFA.

    31 13 CFR 121.201.

    As discussed in the SUPPLEMENTARY INFORMATION, the proposed rule generally would apply to a systemically important insurance company, which includes only nonbank financial companies that the Council has determined under section 113 of the Dodd-Frank Act must be supervised by the Board and for which such determination is in effect. Companies that are subject to the proposed rule therefore substantially exceed the $38.5 million asset threshold at which a life insurance entity and the less than 1,500 employee threshold at which a property and casualty entity is considered a “small entity” under SBA regulations. The proposed rule would apply to a systemically important insurance company designated by the Council under section 113 of the Dodd-Frank Act regardless of such a company's asset size. Although the asset size of nonbank financial companies may not be the determinative factor of whether such companies may pose systemic risks and would be designated by the Council for supervision by the Board, it is an important consideration.32 It is therefore unlikely that a financial firm that is at or below the $38.5 million asset threshold for a life insurance carrier or below the 1,500 employee threshold for a property and casualty carrier would be designated by the Council under section 113 of the Dodd-Frank Act.

    32See 76 FR 4555 (January 26, 2011).

    As noted above, because the proposed rule is not likely to apply to any life insurance carrier with assets of $38.5 million or less or to any property and casualty carrier with less than 1,500 employees, if adopted in final form, it is not expected to apply to any small entity for purposes of the RFA. The Board does not believe that the proposed rule duplicates, overlaps, or conflicts with any other Federal rules. In light of the foregoing, the Board does not believe that the proposed rule, if adopted in final form, would have a significant economic impact on a substantial number of small entities supervised. Nonetheless, the Board seeks comment on whether the proposed rule would impose undue burdens on, or have unintended consequences for, small organizations, and whether there are ways such potential burdens or consequences could be minimized in a manner consistent with section 165 of the Dodd-Frank Act.

    List of Subjects

    Administrative practice and procedure, Banks, banking, Holding companies, Reporting and recordkeeping requirements, Securities.

    Authority and Issuance

    For the reasons set forth in the preamble, chapter II of title 12 of the Code of Federal Regulations is amended as set forth below:

    PART 252—ENHANCED PRUDENTIAL STANDARDS (REGULATION YY) 1. The authority citation for part 252 continues to read as follows: Authority:

    12 U.S.C. 321-338a, 1467a(g), 1818, 1831p-1, 1844(b), 1844(c), 5361, 5365, 5366.

    2. Add subpart P to read as follows: Subpart P—Enhanced Prudential Standards for Systemically Important Insurance Companies Sec. 252.160 Scope. 252.161 Applicability. 252.162 [Reserved] 252.163 Risk-management and risk committee requirements. 252.164 Liquidity risk-management requirements. 252.165 Liquidity stress testing and buffer requirements.
    § 252.160 Scope.

    This subpart applies to systemically important insurance companies. Unless otherwise specified, for purposes of this subpart, the term systemically important insurance company means a nonbank financial company that meets two requirements:

    (a) The Council has determined pursuant to section 113 of the Dodd-Frank Act that the company should be supervised by the Board and subjected to enhanced prudential standards; and

    (b) The company has 40 percent or more of its total consolidated assets related to insurance activities as of the end of either of the two most recently completed fiscal years (systemically important insurance companies) or otherwise has been made subject to this subpart by the Board.

    § 252.161 Applicability.

    (a) General applicability. Subject to the initial applicability provisions of paragraph (b) of this section, a systemically important insurance company must comply with the risk-management and risk-committee requirements set forth in § 252.163 and the liquidity risk-management and liquidity stress test requirements set forth in §§ 252.164 and 252.165 beginning on the first day of the fifth quarter following the date on which the Council determined that the company shall be supervised by the Board.

    (b) Initial applicability. A systemically important insurance company that is subject to supervision by the Board on the date that this rule was adopted by the Board must comply with the risk-management and risk-committee requirements set forth in § 252.163 and the liquidity risk-management and liquidity stress test requirements set forth in §§ 252.164 and 252.165, beginning on [date].

    § 252.162 [Reserved].
    § 252.163 Risk-management and risk committee requirements.

    (a) Risk committee—(1) General. A systemically important insurance company must maintain a risk committee that approves and periodically reviews the risk-management policies of the systemically important insurance company's global operations and oversees the operation of the systemically important insurance company's global risk-management framework. The risk committee's responsibilities include liquidity risk-management as set forth in § 252.164(b).

    (2) Risk-management framework. The systemically important insurance company's global risk-management framework must be commensurate with its structure, risk profile, complexity, activities, and size and must include:

    (i) Policies and procedures establishing risk-management governance, risk-management procedures, and risk-control infrastructure for its global operations; and

    (ii) Processes and systems for implementing and monitoring compliance with such policies and procedures, including:

    (A) Processes and systems for identifying and reporting risks and risk-management deficiencies, including regarding emerging risks, and ensuring effective and timely implementation of actions to address emerging risks and risk-management deficiencies for its global operations;

    (B) Processes and systems for establishing managerial and employee responsibility for risk-management;

    (C) Processes and systems for ensuring the independence of the risk-management function; and

    (D) Processes and systems to integrate risk-management and associated controls with management goals and its compensation structure for its global operations.

    (3) Corporate governance requirements. The risk committee must:

    (i) Have a formal, written charter that is approved by the systemically important insurance company's board of directors;

    (ii) Be an independent committee of the board of directors that has, as its sole and exclusive function, responsibility for the risk-management policies of the systemically important insurance company's global operations and oversight of the operation of the systemically important insurance company's global risk-management framework;

    (iii) Report directly to the systemically important insurance company's board of directors;

    (iv) Receive and review regular reports on not less than a quarterly basis from the systemically important insurance company's chief risk officer provided pursuant to paragraph (b)(2)(ii) of this section; and

    (v) Meet at least quarterly, or more frequently as needed, and fully document and maintain records of its proceedings, including risk-management decisions.

    (4) Minimum member requirements. The risk committee must:

    (i) Include at least one member having experience in identifying, assessing, and managing risk exposures of large, complex financial firms; and

    (ii) Be chaired by a director who:

    (A) Is not an officer or employee of the systemically important insurance company and has not been an officer or employee of the systemically important insurance company during the previous three years;

    (B) Is not a member of the immediate family, as defined in § 225.41(b)(3) of the Board's Regulation Y (12 CFR 225.41(b)(3)), of a person who is, or has been within the last three years, an executive officer of the systemically important insurance company, as defined in § 215.2(e)(1) of the Board's Regulation O (12 CFR 215.2(e)(1)); and

    (C)(1) Is an independent director under Item 407 of the Securities and Exchange Commission's Regulation S-K (17 CFR 229.407(a)), if the systemically important insurance company has an outstanding class of securities traded on an exchange registered with the U.S. Securities and Exchange Commission as a national securities exchange under section 6 of the Securities Exchange Act of 1934 (15 U.S.C. 78f) (national securities exchange); or

    (2) Would qualify as an independent director under the listing standards of a national securities exchange, as demonstrated to the satisfaction of the Board, if the systemically important insurance company does not have an outstanding class of securities traded on a national securities exchange.

    (b) Chief risk officer—(1) General. A systemically important insurance company must appoint a chief risk officer with experience in identifying, assessing, and managing risk exposures of large, complex financial firms.

    (2) Responsibilities. (i) The chief risk officer is responsible for overseeing:

    (A) The establishment of risk limits on an enterprise-wide basis and the monitoring of compliance with such limits;

    (B) The implementation of and ongoing compliance with the policies and procedures set forth in paragraph (a)(2)(i) of this section and the development and implementation of the processes and systems set forth in paragraph (a)(2)(ii) of this section; and

    (C) The management of risks and risk controls within the parameters of the insurance nonbank company's risk control framework, and monitoring and testing of the company's risk controls.

    (ii) The chief risk officer is responsible for reporting risk-management deficiencies and emerging risks to the risk committee and resolving risk-management deficiencies in a timely manner.

    (3) Corporate governance requirements. (i) The systemically important insurance company must ensure that the compensation and other incentives provided to the chief risk officer are consistent with providing an objective assessment of the risks taken by the systemically important insurance company; and

    (ii) The chief risk officer must report directly to both the risk committee and chief executive officer of the company.

    (c) Chief actuary—(1) General. A systemically important insurance company must appoint a chief actuary with the ability to assess and balance risk selection, pricing, and reserving issues across product lines and geographies. A systemically important insurance company with significant life insurance business and property and casualty insurance business may appoint co-chief actuaries, one with responsibility for the company's life business and one with responsibility for the company's property and casualty business, in which case the below requirements would apply to each chief actuary.

    (2) Responsibilities. (i) The chief actuary is responsible for determining on an enterprise-wide basis the adequacy of reserves and reviewing and advising senior management on the level of reserves.

    (ii) The chief actuary is responsible for overseeing various activities, including but not limited to:

    (A) Implementation of measures that assess the sufficiency of reserves;

    (B) Review of the appropriateness of actuarial models, data, and assumptions used in reserving; and

    (C) Implementation of and compliance with appropriate policies and procedures relating to actuarial work in reserving.

    (iii) The systemically important insurance company must ensure that the compensation and other incentives provided to the chief actuary are consistent with providing an objective assessment of the systemically important insurance company's reserves.

    (iv) The chief actuary must report directly to the audit committee of the company and may also have additional lines of reporting.

    § 252.164 Liquidity risk-management requirements.

    (a) Responsibilities of the board of directors—(1) Liquidity risk tolerance. The board of directors of a systemically important insurance company must:

    (i) Approve the acceptable level of liquidity risk that the systemically important insurance company may assume in connection with its operating strategies (liquidity risk tolerance) at least annually, taking into account the systemically important insurance company's capital structure, risk profile, complexity, activities, and size; and

    (ii) Receive and review at least semi-annually information provided by senior management to determine whether the systemically important insurance company is operating in accordance with its established liquidity risk tolerance.

    (2) Liquidity risk-management strategies, policies, and procedures. The board of directors must approve and periodically review the liquidity risk-management strategies, policies, and procedures established by senior management pursuant to paragraph (c)(1) of this section.

    (b) Responsibilities of the risk committee. The risk committee (or a designated subcommittee of such committee composed of members of the board of directors) must approve the contingency funding plan described in paragraph (f) of this section at least annually, and must approve any material revisions to the plan prior to the implementation of such revisions.

    (c) Responsibilities of senior management—(1) Liquidity risk. (i) Senior management of a systemically important insurance company must establish and implement strategies, policies, and procedures designed to effectively manage the risk that the systemically important insurance company's financial condition or safety and soundness would be adversely affected by its inability or the market's perception of its inability to meet its cash and collateral obligations (liquidity risk). The board of directors must approve the strategies, policies, and procedures pursuant to paragraph (a)(2) of this section.

    (ii) Senior management must oversee the development and implementation of liquidity risk measurement and reporting systems, including those required by this section and § 252.165.

    (iii) Senior management must determine at least quarterly whether the systemically important insurance company is operating in accordance with such policies and procedures and whether the systemically important insurance company is in compliance with this section and § 252.165 (or more often, if changes in market conditions or the liquidity position, risk profile, or financial condition warrant), and establish procedures regarding the preparation of such information.

    (2) Liquidity risk tolerance reporting. Senior management must report to the board of directors or the risk committee regarding the systemically important insurance company's liquidity risk profile and liquidity risk tolerance at least quarterly (or more often, if changes in market conditions or the liquidity position, risk profile, or financial condition of the company warrant).

    (3) Business activities and products. (i) Before a systemically important insurance company offers a new product or initiates a new activity that could potentially materially adversely affect the designated insurer's liquidity, senior management must approve such product or activity after evaluating the liquidity costs, benefits, and risks associated with such product or activity. In determining whether to approve the new activity or product, senior management must consider whether the liquidity risk of the new activity or product (under both current and stressed conditions) is within the company's established liquidity risk tolerance.

    (ii) Senior management must review at least annually significant business activities and products to determine whether any activity or product creates or has created any unanticipated liquidity risk, and to determine whether the liquidity risk of each activity or product is within the company's established liquidity risk tolerance.

    (4) Cash-flow projections. Senior management must review the cash-flow projections produced under paragraph (e) of this section at least quarterly (or more often, if changes in market conditions or the liquidity position, risk profile, or financial condition of the systemically important insurance company warrant) to ensure that the liquidity risk is within the established liquidity risk tolerance.

    (5) Liquidity risk limits. Senior management must establish liquidity risk limits as set forth in paragraph (g) of this section and review the company's compliance with those limits at least quarterly (or more often, if changes in market conditions or the liquidity position, risk profile, or financial condition of the company warrant).

    (6) Liquidity stress testing. Senior management must:

    (i) Approve the liquidity stress testing practices, methodologies, and assumptions required in § 252.165(a) at least quarterly, and whenever the systemically important insurance company materially revises its liquidity stress testing practices, methodologies or assumptions;

    (ii) Review the liquidity stress testing results produced under § 252.165(a) at least quarterly;

    (iii) Review the independent review of the liquidity stress tests under paragraph (d) of this section periodically; and

    (iv) Approve the size and composition of the liquidity buffer established under § 252.165(b) at least quarterly.

    (d) Independent review function. (1) A systemically important insurance company must establish and maintain a review function to evaluate its liquidity risk-management.

    (2) The independent review function must:

    (i) Regularly, but no less frequently than annually, review and evaluate the adequacy and effectiveness of the company's liquidity risk-management processes, including its liquidity stress test processes and assumptions;

    (ii) Assess whether the company's liquidity risk-management function complies with applicable laws, regulations, supervisory guidance, and sound business practices;

    (iii) Report material liquidity risk-management issues to the board of directors or the risk committee in writing for corrective action, to the extent permitted by applicable law; and

    (iv) Be independent of management functions that execute funding.

    (e) Cash-flow projections. (1) A systemically important insurance company must produce comprehensive cash-flow projections that project cash flows arising from assets, liabilities, and off-balance sheet exposures over, at a minimum, short- and long-term time horizons, including time horizons longer than one year. The systemically important insurance company must update short-term cash-flow projections daily and must update longer-term cash-flow projections at least monthly.

    (2) The systemically important insurance company must establish a methodology for making cash-flow projections that results in projections that:

    (i) Include cash flows arising from anticipated claim and annuity payments; policyholder options including surrenders, withdrawals, and policy loans; intercompany transactions; premiums on new and renewal business; expenses; maturities and renewals of funding instruments, including through the operation of any provisions that could accelerate the maturity; investment income and proceeds from assets sales; and other potential liquidity exposures;

    (ii) Include reasonable assumptions regarding the future behavior of assets, liabilities, and off-balance sheet exposures;

    (iii) Identify and quantify discrete and cumulative cash flow mismatches over these time periods; and

    (iv) Include sufficient detail to reflect the capital structure, risk profile, complexity, currency exposure, activities, and size of the systemically important insurance company, and any applicable legal and regulatory requirements, and include analyses by business line, currency, or legal entity as appropriate.

    (3) The systemically important insurance company must adequately document its methodology for making cash flow projections and the included assumptions.

    (f) Contingency funding plan. (1) A systemically important insurance company must establish and maintain a contingency funding plan that sets out the company's strategies for addressing liquidity needs during liquidity stress events and describes the steps that should be taken to ensure that the systemically important insurance company's sources of liquidity are sufficient to fund its normal operating requirements under stress events. To operate normally, a firm must have sufficient funding to pay obligations in the ordinary course as they become due and meet all solvency requirements for the writing of new and renewal policies. The contingency funding plan must be commensurate with the company's capital structure, risk profile, complexity, activities, size, and established liquidity risk tolerance. The company must update the contingency funding plan at least annually, and when changes to market and idiosyncratic conditions warrant.

    (2) Components of the contingency funding plan—(i) Quantitative assessment. The contingency funding plan must:

    (A) Identify liquidity stress events that could have a significant impact on the systemically important insurance company's liquidity;

    (B) Assess the level and nature of the impact on the systemically important insurance company's liquidity that may occur during identified liquidity stress events;

    (C) Identify the circumstances in which the systemically important insurance company would implement its action plan described in paragraph (f)(2)(ii)(A) of this section, which circumstances must include failure to meet any minimum liquidity requirement imposed by the Board;

    (D) Assess available funding sources and needs during the identified liquidity stress events;

    (E) Identify alternative funding sources that may be used during the identified liquidity stress events; and

    (F) Incorporate information generated by the liquidity stress testing required under § 252.165(a).

    (ii) Liquidity event management process. The contingency funding plan must include an event management process that sets out the systemically important insurance company's procedures for managing liquidity during identified liquidity stress events. The liquidity event management process must:

    (A) Include an action plan that clearly describes the strategies the company will use to respond to liquidity shortfalls for identified liquidity stress events, including the methods that the company will use to access alternative funding sources;

    (B) Identify a liquidity stress event management team that would execute the action plan described in paragraph (f)(2)(ii)(A) of this section;

    (C) Specify the process, responsibilities, and triggers for invoking the contingency funding plan, describe the decision-making process during the identified liquidity stress events, and describe the process for executing contingency measures identified in the action plan; and

    (D) Provide a mechanism that ensures effective reporting and communication within the systemically important insurance company and with outside parties, including the Board and other relevant supervisors, counterparties, and other stakeholders.

    (iii) Monitoring. The contingency funding plan must include procedures for monitoring emerging liquidity stress events. The procedures must identify early warning indicators that are tailored to the company's capital structure, risk profile, complexity, activities, and size.

    (3) Testing. The systemically important insurance company must periodically test:

    (i) The components of the contingency funding plan to assess the plan's reliability during liquidity stress events;

    (ii) The operational elements of the contingency funding plan, including operational simulations to test communications, coordination, and decision-making by relevant management; and

    (iii) The methods the systemically important insurance company will use to access alternative funding sources to determine whether these funding sources will be readily available when needed.

    (g) Liquidity risk limits—(1) General. A systemically important insurance company must monitor sources of liquidity risk and establish limits on liquidity risk, including limits on:

    (i) Concentrations in sources of funding by instrument type, single counterparty, counterparty type, secured and unsecured funding, and as applicable, other forms of liquidity risk;

    (ii) Potential sources of liquidity risk arising from insurance liabilities;

    (iii) The amount of non-insurance liabilities that mature within various time horizons; and

    (iv) Off-balance sheet exposures and other exposures that could create funding needs during liquidity stress events.

    (2) Size of limits. Each limit established pursuant to paragraph (g)(1) of this section must be consistent with the company's established liquidity risk tolerance and must reflect the company's capital structure, risk profile, complexity, activities, and size.

    (h) Collateral, legal entity, and intraday liquidity risk monitoring. A systemically important insurance company must establish and maintain procedures for monitoring liquidity risk as set forth in this paragraph.

    (1) Collateral. The systemically important insurance company must establish and maintain policies and procedures to monitor assets that have been, or are available to be, pledged as collateral in connection with transactions to which it or its affiliates are counterparties. These policies and procedures must provide that the systemically important insurance company:

    (i) Calculates all of its collateral positions on a weekly basis (or more frequently, as directed by the Board), specifying the value of pledged assets relative to the amount of security required under the relevant contracts and the value of unencumbered assets available to be pledged;

    (ii) Monitors the levels of unencumbered assets available to be pledged by legal entity, jurisdiction, and currency exposure;

    (iii) Monitors shifts in the systemically important insurance company's funding patterns, such as shifts in the tenor of obligations and collateral requirements; and

    (iv) Tracks operational and timing requirements associated with accessing collateral at its physical location (for example, the custodian or securities settlement system that holds the collateral).

    (2) Legal entities, currencies, and business lines. The systemically important insurance company must establish and maintain procedures for monitoring and controlling liquidity risk exposures and funding needs within and across significant legal entities, currencies, and business lines, taking into account legal and regulatory restrictions on the transfer of liquidity between legal entities.

    (3) Intraday exposures. The systemically important insurance company must establish and maintain procedures for monitoring the intraday liquidity risk exposure of the systemically important insurance company if necessary for its business. If applicable, these procedures must address how the management of the systemically important insurance company will:

    (i) Monitor and measure expected daily gross liquidity inflows and outflows;

    (ii) Identify and prioritize time-specific obligations so that the systemically important insurance company can meet these obligations as expected and settle less critical obligations as soon as possible;

    (iii) Coordinate the purchase and sale of derivatives so as to maximize the effectiveness of their hedging programs;

    (iv) Consider the amounts of collateral and liquidity needed to meet obligations when assessing the systemically important insurance company's overall liquidity needs; and

    (v) Where necessary, manage and transfer collateral to obtain intraday credit.

    § 252.165 Liquidity stress testing and buffer requirements.

    (a) Liquidity stress testing requirement—(1) General. A systemically important insurance company must conduct stress tests to assess the potential impact of the liquidity stress scenarios set forth in paragraph (a)(3) of this section on its cash flows, liquidity position, profitability, and solvency, taking into account its current liquidity condition, risks, exposures, strategies, and activities.

    (i) The systemically important insurance company must take into consideration its balance sheet exposures, off-balance sheet exposures, size, risk profile, complexity, business lines, organizational structure, and other characteristics of the systemically important insurance company that affect its liquidity risk profile in conducting its stress test. Mechanisms that would imperil a systemically important insurance company's ability to continue operations—such as contractual stays—should not be taken into consideration as a source of liquidity in stress testing.

    (ii) In conducting a liquidity stress test using the scenarios described in paragraph (a)(3) of this section, the systemically important insurance company must address the potential direct adverse impact of associated market disruptions on the systemically important insurance company and incorporate the potential actions of other market participants experiencing liquidity stresses, contract holders, and policyholders under the market disruptions that would adversely affect the systemically important insurance company.

    (2) Frequency. The liquidity stress tests required under paragraph (a)(1) of this section must be performed at least monthly. The Board may require the systemically important insurance company to perform stress testing more frequently.

    (3) Stress scenarios. (i) Each liquidity stress test conducted under paragraph (a)(1) of this section must include, at a minimum:

    (A) A scenario reflecting adverse market conditions;

    (B) A scenario reflecting an idiosyncratic stress event for the systemically important insurance company; and

    (C) A scenario reflecting combined market and idiosyncratic stresses.

    (ii) The systemically important insurance company must incorporate additional liquidity stress scenarios into its liquidity stress test, as appropriate, based on its financial condition, size, complexity, risk profile, scope of operations, or activities. The Board may require the systemically important insurance company to vary the underlying assumptions and stress scenarios.

    (4) Planning horizon. Each stress test conducted under paragraph (a)(1) of this section must include a seven-day planning horizon, a 30-day planning horizon, a 90-day planning horizon, a one-year planning horizon, and any other planning horizons that are relevant to the systemically important insurance company's liquidity risk profile. For purposes of this section, a “planning horizon” is the period over which the relevant stressed projections extend. The systemically important insurance company must use the results of the stress test over the 90-day planning horizon to calculate the size of the liquidity buffer under paragraph (b) of this section.

    (5) Requirements for assets used as cash-flow sources in a stress test. (i) To the extent an asset is used as a cash-flow source to offset projected funding needs during the planning horizon in a liquidity stress test, the fair market value of the asset must be discounted to reflect any credit risk and market volatility of the asset.

    (ii) Assets used as cash-flow sources during a planning horizon must be diversified by collateral, counterparty, borrowing capacity, and other factors associated with the liquidity risk of the assets.

    (iii) For stress tests with a planning horizon of 90 days or less, cash-flow sources cannot include future borrowings or the liquidation of assets unless they meet the requirement to be part of the buffer as defined in (b)(3) of this section. In all stress tests and notwithstanding the limitations on asset liquidity, separate account assets and closed block assets would be permitted to be included as cash-flow sources in proportion to the cash flow needs in these same accounts.

    (6) Tailoring. Stress testing must be tailored to, and provide sufficient detail to reflect, a systemically important insurance company's capital structure, risk profile, complexity, activities, and size.

    (7) Governance—(i) Policies and procedures. A systemically important insurance company must establish and maintain policies and procedures governing its liquidity stress testing practices, methodologies, and assumptions that provide for the incorporation of the results of liquidity stress tests in future stress testing and for the enhancement of stress testing practices over time.

    (ii) Controls and oversight. A systemically important insurance company must establish and maintain a system of controls and oversight that is designed to ensure that its liquidity stress testing processes are effective in meeting the requirements of this section. The controls and oversight must ensure that each liquidity stress test appropriately incorporates conservative assumptions with respect to the stress scenario in paragraph (a)(3) of this section and other elements of the stress-test process, taking into consideration the systemically important insurance company's capital structure, risk profile, complexity, activities, size, business lines, legal entity or jurisdiction, and other relevant factors. The assumptions must be approved by the chief risk officer and be subject to the independent review under § 252.164(d).

    (iii) Management information systems. The systemically important insurance company must maintain management information systems and data processes sufficient to enable it to effectively and reliably collect, sort, and aggregate data and other information related to liquidity stress testing.

    (b) Liquidity buffer requirement. (1) A systemically important insurance company must maintain a liquidity buffer that is sufficient to meet the projected net stressed cash-flow need over the 90-day planning horizon of a liquidity stress test conducted in accordance with paragraph (a) of this section under each scenario set forth in paragraph (a)(3) of this section.

    (2) Net stressed cash-flow need. The net stressed cash-flow need for a systemically important insurance company is the difference between the amount of its cash-flow need and the amount of its cash flow sources over the 90-day planning horizon.

    (3) Asset requirements. The liquidity buffer must consist of highly liquid assets that are unencumbered, as defined in paragraph (b)(3)(ii) of this section:

    (i) Highly liquid asset. A highly liquid asset includes:

    (A) A security that is issued by, or unconditionally guaranteed as to the timely payment of principal and interest by, the U.S. Department of the Treasury;

    (B) A security that is issued by, or unconditionally guaranteed as to the timely payment of principal and interest by, a U.S. government agency (other than the U.S. Department of the Treasury) whose obligations are fully and explicitly guaranteed by the full faith and credit of the U.S. government provided that the security is liquid and readily-marketable, as defined in paragraph (b)(3)(iii) of this section;

    (C) A security that is issued by, or unconditionally guaranteed as to the timely payment of principal and interest by, a sovereign entity, the Bank for International Settlements, the International Monetary Fund, the European Central Bank, European Community, or a multilateral development bank, that is:

    (i) Either:

    (A) Assigned no higher than a 20 percent risk weight under subpart D of Regulation Q (12 CFR part 217); or

    (B) Issued by a sovereign entity in its own currency and the systemically important insurance company holds the security in order to meet its net cash outflows in the jurisdiction of the sovereign entity;

    (ii) Liquid and readily-marketable, as defined in paragraph (b)(3)(iii) of this section;

    (iii) Issued or guaranteed by an entity whose obligations have a proven record as a reliable source of liquidity in repurchase or sales markets during stressed market conditions; and

    (iv) Not an obligation of a financial sector entity and not an obligation of a consolidated subsidiary of a financial sector entity;

    (D) A security issued by, or guaranteed as to the timely payment of principal and interest by, a U.S. government sponsored enterprise, that is investment grade under 12 CFR part 1 as of the calculation date, provided that the claim is senior to preferred stock and liquid and readily-marketable, as defined in paragraph (b)(3)(iii) of this section;

    (E) A corporate debt security that is:

    (i) Liquid and readily-marketable, as defined in paragraph (b)(3)(iii) of this section

    (ii) Investment grade under 12 CFR part 1 as of the calculation date;

    (iii) Issued or guaranteed by an entity whose obligations have a proven record as a reliable source of liquidity in repurchase or sales markets during stressed market conditions; and

    (iv) Not an obligation of a financial sector entity and not an obligation of a consolidated subsidiary of a financial sector entity; or

    (F) A publicly traded common equity share that is:

    (i) Liquid and readily-marketable, as defined in paragraph (b)(3)(iii) of this section;

    (ii) Included in: The Russell 1000 Index;

    (iii) Issued by an entity whose publicly traded common equity shares have a proven record as a reliable source of liquidity in repurchase or sales markets during stressed market conditions;

    (iv) Not issued by a financial sector entity and not issued by a consolidated subsidiary of a financial sector entity; and

    (vi) If held by a depository institution, is not acquired in satisfaction of a debt previously contracted (DPC);

    (G) A general obligation security issued by, or guaranteed as to the timely payment of principal and interest by, a public sector entity where the security is:

    (i) Liquid and readily-marketable, as defined in paragraph (b)(3)(iii) of this section;

    (ii) Investment grade under 12 CFR part 1 as of the calculation date;

    (iii) Issued or guaranteed by a public sector entity whose obligations have a proven record as a reliable source of liquidity in repurchase or sales markets during stressed market conditions; and

    (iv) Not an obligation of a financial sector entity and not an obligation of a consolidated subsidiary of a financial sector entity, except that a security will not be disqualified as a highly liquid asset solely because it is guaranteed by a financial sector entity or a consolidated subsidiary of a financial sector entity if the security would, if not guaranteed, meet the criteria of this section.

    (H) Any other asset that the systemically important insurance company demonstrates to the satisfaction of the Board:

    (1) Has low credit risk and low market risk;

    (2) Liquid and readily-marketable, as defined in paragraph (b)(3)(iii) of this section and

    (3) Is a type of asset that investors historically have purchased in periods of financial market distress during which market liquidity has been impaired.

    (ii) Unencumbered. An asset is unencumbered if it:

    (A) Is free of legal, regulatory, contractual, or other restrictions on the ability of such systemically important insurance company promptly to liquidate, sell or transfer the asset; and

    (B) Is not pledged or used to secure or provide credit enhancement to any transaction.

    (iii) Liquid and readily marketable. Liquid and readily-marketable means, with respect to a security, that the security is traded in an active secondary market with:

    (1) More than two committed market makers;

    (2) A large number of non-market maker participants on both the buying and selling sides of transactions;

    (3) Timely and observable market prices; and

    (4) A high trading volume.

    (iv) Limitations on intra-group transfer of funds. Insurance non-bank financial companies must hold enough highly liquid, unencumbered assets at the top-tier holding company to cover the sum of all stand-alone material entity net liquidity deficits. The stand-alone net liquidity deficit of each material entity would be calculated as that entity's amount of net stressed outflows over a 90-day planning horizon less the highly liquid assets held at the material entity. For the purposes of evaluating liquidity deficits of material entities, systemically important insurance companies should treat inter-affiliate exposures in the same manner as third-party exposures. The remaining highly liquid, unencumbered assets that are held to satisfy the liquidity buffer requirement can be held at a regulated company up to:

    (A) The average amount of net cash outflows of the company holding the assets during the 90-day planning horizon in the scenarios set forth in paragraph (a)(3) plus.

    (B) Any additional amount of assets, including proceeds from the monetization of assets that would be available for transfer to the top-tier company during times of stress without statutory, regulatory, contractual, or supervisory restrictions.

    (v) Calculating the amount of a highly liquid asset. In calculating the amount of a highly liquid asset included in the liquidity buffer, the systemically important insurance company must discount the fair market value of the asset to reflect any credit risk and market price volatility of the asset.

    (vi) Diversification. The liquidity buffer must not contain significant concentrations of highly liquid assets by issuer, business sector, region, or other factor related to the systemically important insurance company's risk, except with respect to cash and securities issued or guaranteed by the United States, a U.S. government agency, or a U.S. government-sponsored enterprise.

    By order of the Board of Governors of the Federal Reserve System, June 9, 2016. Robert deV. Frierson, Secretary of the Board.
    [FR Doc. 2016-14005 Filed 6-13-16; 8:45 am] BILLING CODE 6210-01-P
    FEDERAL RESERVE SYSTEM 12 CFR Chapter II [Docket No. R-1539] RIN 7100 AE 53 Capital Requirements for Supervised Institutions Significantly Engaged in Insurance Activities AGENCY:

    Board of Governors of the Federal Reserve System.

    ACTION:

    Advance notice of proposed rulemaking.

    SUMMARY:

    The Board of Governors of the Federal Reserve System (Board) is inviting comment on an advance notice of proposed rulemaking (ANPR) regarding approaches to regulatory capital requirements for depository institution holding companies significantly engaged in insurance activities (insurance depository institution holding companies), and nonbank financial companies that the Financial Stability Oversight Council (FSOC or Council) has determined will be supervised by the Board and that have significant insurance activities (systemically important insurance companies). The Board is inviting comment on two approaches to consolidated capital requirements for these institutions: An approach that uses existing legal entity capital requirements as building blocks for insurance depository institution holding companies and a simple consolidated approach for systemically important insurance companies.

    DATES:

    Comments must be received no later than August 17, 2016.

    ADDRESSES:

    You may submit comments, identified by Docket No. R-1539; RIN 7100 AE 53), by any of the following methods:

    Agency Web site: http://www.federalreserve.gov. Follow the instructions for submitting comments at http://www.federalreserve.gov/generalinfo/foia/ProposedRegs.cfm.

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

    Email: [email protected] Include Docket No. R-1539; RIN 7100 AE 53) in the subject line of the message.

    Fax: (202) 452-3819 or (202) 452-3102.

    Mail: Robert deV. Frierson, Secretary, Board of Governors of the Federal Reserve System, 20th Street and Constitution Avenue NW., Washington, DC 20551.

    All public comments will be made available on the Board's Web site at http://www.federalreserve.gov/generalinfo/foia/ProposedRegs.cfm as submitted, unless modified for technical reasons. Accordingly, your comments will not be edited to remove any identifying or contact information. Public comments may also be viewed electronically or in paper form in Room 3515, 1801 K Street NW., (between 18th and 19th Streets NW.), Washington, DC 20006 between 9:00 a.m. and 5:00 p.m. on weekdays. For security reasons, the Board requires that visitors make an appointment to inspect comments. You may do so by calling (202) 452-3684. Upon arrival, visitors will be required to present valid government-issued photo identification and to submit to security screening in order to inspect and photocopy comments.
    FOR FURTHER INFORMATION CONTACT:

    Thomas Sullivan, Associate Director, (202) 475-7656, Linda Duzick, Manager, (202) 728-5881, or Suyash Paliwal, Senior Insurance Policy Analyst, (202) 974-7033, Division of Banking Supervision and Regulation; or Laurie Schaffer, Associate General Counsel, (202) 452-2272, Benjamin W. McDonough, Special Counsel, (202) 452-2036; Tate Wilson, Counsel, (202) 452-369; David Alexander, Counsel, (202) 452-2877; or Mary Watkins, Attorney (202) 452-3722, Legal Division.

    SUPPLEMENTARY INFORMATION:

    I. Introduction A. Background

    Robust capital is an important safeguard to protect the safety and soundness of financial institutions; enhance the resilience of financial institutions to position them to better navigate periods of financial or economic stress; and mitigate threats to financial stability that might be posed by the activities, material financial distress, or failure of financial institutions. To help achieve these benefits, various provisions of Federal law require the Board and other Federal banking agencies to establish minimum capital standards for holding companies that own insured depository institutions (IDIs) and for financial firms that are designated by the FSOC for supervision by the Board. The capital standards developed by the Board take into account the overall risk profile and the size, scope, and complexity of the operations of the institution. Further, the law allows the Board to tailor the minimum capital requirements applicable to companies that both own an IDI and significantly engage in insurance activities as well as for systemically important insurance companies.

    The Board's supervisory objectives in setting capital requirements for the consolidated institution focus on the safety and soundness of the company and its IDI and on enhancing financial stability, and complement the primary mission of state legal entity insurance supervisors, which tends to focus on the protection of policyholders.1 To achieve these objectives, the Board seeks comment on several approaches to designing a regulatory capital framework for supervised institutions significantly engaged in insurance activities that is intended to ensure that the institution has sufficient capital, commensurate with its overall institution-wide risk profile (1) to absorb losses and continue operations as a going concern throughout times of economic, financial, and insurance-related stress (e.g., morbidity, mortality, longevity, natural and man-made catastrophes); (2) to serve as a source of strength to any subsidiary depository institutions; 2 and (3) to substantially mitigate any threats to financial stability that the institution might pose.

    1 For discussion regarding state supervision of insurance, see, e.g., Financial Stability Oversight Council, Basis of the Financial Stability Oversight Council's Final Determination Regarding American International Group, Inc. (July 8, 2013), available at https://www.treasury.gov/initiatives/fsoc/designations/Documents/Basis%20of%20Final%20Determination%20Regarding%20American%20International%20Group,%20Inc.pdf; Financial Stability Oversight Council, Basis of the Financial Stability Oversight Council's Final Determination Regarding Prudential Financial, Inc. (Sept. 19, 2013), available at https://www.treasury.gov/initiatives/fsoc/designations/Documents/Prudential%20Financial%20Inc.pdf.

    2 12 U.S.C. 1831o-1. See also, 12 U.S.C. 1844 and Section 706, Division O, of the Consolidated Appropriations Act, 2016, Public Law 114-113, 129 Stat. 2242 (2015).

    B. The Board's Consolidated Supervision of Systemically Important Insurance Companies and Insurance Depository Institution Holding Companies

    This ANPR seeks comment on proposed approaches to regulatory capital requirements that are tailored to the risks of supervised insurance institutions, including both insurance depository institution holding companies and systemically important insurance companies.

    The Board has broad authority to establish regulatory capital standards for savings and loan holding companies (SLHCs) and bank holding companies (BHCs) 3 under the Home Owners' Loan Act (HOLA) and Bank Holding Company Act, respectively.4 The Board's supervisory objectives for insurance depository institution holding companies include ensuring the safe and sound operation of the consolidated firms and subsidiary IDIs, and ensuring that holding companies can serve as a source of strength for any subsidiary IDIs.5 In addition, certain nonbank financial companies with significant insurance activities have been designated by the Council pursuant to section 113 of the Dodd-Frank Act 6 to be supervised by the Board and made subject to enhanced prudential standards. For these systemically important insurance companies, the Board is required under section 165 of the Dodd-Frank Act to establish enhanced prudential standards, including more stringent risk-based and leverage capital requirements, as well as stress tests.7

    3 BHCs that are financial holding companies may engage in insurance underwriting activities. 12 U.S.C. 1844(k).

    4 12 U.S.C. 1841 et seq.; 12 U.S.C. 1467a(g).

    5 12 U.S.C. 1831o-1. See also 12 U.S.C. 1467a(g)(5).

    6 12 U.S.C. 5323; see also Basis of the Financial Stability Oversight Council's Final Determination Regarding American International Group, Inc. (July 8, 2013), available at http://www.treasury.gov/initiatives/fsoc/designations/Documents/Basis%20of%20Final%20Determination%20Regarding%20American%20International%20Group,%20Inc.pdf; Basis for the Financial Stability Oversight Council's Final Determination Regarding Prudential Financial, Inc. (Sept. 19, 2013), available at http://www.treasury.gov/initiatives/fsoc/designations/Documents/Prudential%20Financial%20Inc.pdf.

    7 12 U.S.C. 5365. Section 165 of the Dodd-Frank Act would also direct the Board to establish consolidated capital requirements and administer stress test for any insurance depository institution holding companies that are BHCs with at least $50 billion in total consolidated assets. Presently, there are no BHCs that are also insurance depository institution holding companies.

    With respect to both insurance depository institution holding companies and systemically important insurance companies, the Board must establish minimum leverage capital requirements and minimum risk-based capital requirements that apply (1) on a consolidated basis, and (2) are at least as stringent as the generally applicable capital requirements that applied to IDIs at the time the Dodd-Frank Act was adopted, as well as current generally applicable IDI capital requirements.8 The Dodd-Frank Act has been amended to allow the Board to tailor these minimum capital requirements as they would apply to persons regulated by state or foreign insurance regulators.9

    8 12 U.S.C. 5371.

    9 12 U.S.C. 5371(c)(1).

    The Board currently supervises twelve insurance depository institution holding companies and two systemically important insurance companies. Collectively, these firms have approximately $2 trillion in assets and represent approximately one-quarter of the assets of the U.S. insurance industry. These institutions range in size from approximately $3 billion in total assets to about $700 billion in total assets, and engage in a wide variety of insurance and non-insurance activities. Some of the firms operate exclusively in the United States, and some have material international operations. These institutions have a variety of ownership structures, including stock and mutual forms of ownership. Some of these institutions prepare financial statements according to U.S. Generally Accepted Accounting Principles (U.S. GAAP), and some do not, preparing financial statements only according to U.S. Statutory Accounting Principles (SAP) filed with their relevant state insurance regulators. The insurance depository institution holding companies tend to have simpler structures, often have an operating company, rather than a holding company, as the top-tier parent, and have a relatively greater U.S. focus in their operations. By contrast, the systemically important insurance companies are relatively larger financial institutions with substantial international operations, comparatively complex organizational structures relative to other insurance companies, and non-insurance as well as insurance activities.

    The Board aims to develop regulatory capital frameworks for insurance depository institution holding companies and systemically important insurance companies that are consistent with the Board's supervisory objectives and appropriately tailored to the business of insurance. The Board is seeking comment on different frameworks that could be applied to insurance depository institution holding companies and systemically important insurance companies. As described below, this ANPR outlines two conceptual frameworks, one of which may be more appropriate for large, complex, systemically important institutions, while the other may be more appropriate for generally less complex firms such as the current population of insurance depository institution holding companies.

    The Board is also seeking comment on the criteria that should be used to determine which supervised institutions are subject to regulatory capital requirements that are tailored to the business of insurance. A supervised insurance institution could become subject to tailored regulatory capital rules based on the significance of these activities for the consolidated firm. The Board could apply a threshold based on a percentage of total consolidated assets attributable to insurance activities. For example, for purposes of determining whether an SLHC is significantly engaged in insurance activities and should be subject to capital requirements that are tailored to these risks, the Board is considering using the threshold in the Board's existing capital requirements (Regulation Q).10 Under this approach, an SLHC would be subject to the capital requirements as an insurance SLHC if it held 25 percent or more of its total consolidated assets in insurance underwriting subsidiaries (other than assets associated with insurance underwriting for credit risk).11 Further, the Board could define systemically important insurance companies as FSOC-designated nonbank financial companies with at least 40 percent of total consolidated assets related to insurance activities (as of the end of either of the two most recently completed fiscal years), or as otherwise ordered by the Board. These thresholds could reflect a level of insurance activity that is significant rather than incidental to the institution's activities.

    10 12 CFR 217.2.

    11 12 CFR 217.2. Depository institution holding companies comprise BHCs as well as SLHCs. Presently, the population of Board-supervised insurance depository institution holding companies includes 12 SLHCs significantly engaged in insurance activities. To the extent that a BHC met the definition of an insurance depository institution holding company, the Board would need to consider whether to exclude the BHC from the Board's Regulation Q and instead apply a different approach.

    The Board invites comment on all aspects of these frameworks, including whether these frameworks are workable, would enhance the resilience of these institutions, and would reduce risks to financial stability. The Board also invites comment and suggestions on other frameworks that may better achieve these purposes. In addition, the Board invites comment on the costs and benefits of these and alternate approaches, and on the various advantages and difficulties of each approach. To help the Board address specific issues raised by the regulatory capital frameworks discussed below, the Board also invites comment on the specific questions listed throughout this notice.

    II. Consolidated Capital Frameworks for Supervised Institutions Significantly Engaged in Insurance Activities: Two Options

    In developing and evaluating potential capital frameworks, the Board relied on its experience in supervision of financial firms and with the development and application of capital standards through normal and stressed periods; discussions with affected financial firms, including firms engaged in insurance activities; the purposes of and requirements in Federal law; and information and insights provided by other supervisors, including state insurance supervisors, among other things.

    Insurance supervisors, insurance companies and others have argued that because liability structures, asset classes, and asset-liability matching of insurance companies differ markedly from those of a typical BHC, the capital framework (or frameworks) should be tailored to the business mix and risk profile of insurance depository institution holding companies and systemically important insurance companies. They have also contended that leverage limits based on the ratio of equity to total assets, which are an important backstop in a banking regulatory capital framework, may have less value as a risk metric for supervised institutions significantly engaged in insurance activities because they do not address the different liability structure that is inherent to the insurance business. The Board has flexibility to develop leverage and risk-based capital requirements that are tailored to appropriately reflect the risks of supervised institutions significantly engaged in insurance activities.12

    12See Insurance Capital Standards Clarification Act of 2014, Public Law 113-279, 128 Stat. 3017 (2014).

    At the same time, supervisors and commenters recognize that a capital framework also should take into account all material risk types (insurance and non-insurance) in these institutions. Capital standards that do not account for all types of material risks tend to be ineffective and incent riskier activity. In addition, to the greatest extent possible, the capital framework should take account of risks across the entire firm—in the holding company, in regulated subsidiaries, and in unregulated subsidiaries. The financial crisis demonstrated that risks of financial distress often spread across an organization from unregulated subsidiaries to regulated subsidiaries.13 Moreover, the framework should be as standardized as possible, rather than relying predominantly on a firm's internal capital models. Greater standardization will produce more consistent capital requirements, enhance comparability across firms, and promote greater transparency.14

    13 For example, severe losses in non-insurance subsidiaries may undermine confidence in an entire insurance organization and contribute to a firm's inability to meet obligations. Board of Governors of the Federal Reserve System, Regulatory Reform, American International Group (AIG), Maiden Lane II and III, available at https://www.federalreserve.gov/newsevents/reform_aig.htm.

    14 Actuarial models, as opposed to asset risk-weighting models, are nonetheless important in setting insurance reserves.

    The capital framework also should be based on U.S. regulatory and accounting standards and not foreign regulatory and accounting standards in order to best meet the needs of the U.S. financial system and insurance markets while reflecting the risks inherent in the business of insurance. The framework should strike a reasonable balance between simplicity and risk sensitivity. Achieving this balance will help ensure that risks are accurately captured while minimizing regulatory burden and increasing comparability and transparency across firms. The framework also should be executable in the short-to-medium term. Finally, the framework should contribute to the stability of the financial system and should serve as a good basis for a supervisory stress test regime to the extent these provisions apply to the regulated firm.

    The Board invites comment on the considerations that should guide the development of a regulatory capital framework for insurance depository institution holding companies and systemically important insurance companies.

    Question 1. Are these identified considerations appropriate? Are there other considerations the Board should incorporate in its evaluation of capital frameworks for supervised institutions significantly engaged in insurance activities?

    Question 2. Should the same capital framework apply to all supervised insurance institutions?

    Question 3. What criteria should the Board use to determine whether a supervised insurance institution should be subject to regulatory capital rules tailored to the business of insurance?

    Question 4. If multiple capital frameworks are used, what criteria should be used to determine whether a supervised insurance institution should be subject to each framework?

    Question 5. In addition to insurance underwriting activities, what other activities, if any, should be used to determine whether a supervised institution is significantly engaged in insurance activities and should be subject to regulatory capital requirements tailored to the business mix and risk profile of insurance?

    The remainder of this section will describe two potential regulatory capital frameworks for supervised institutions significantly engaged in insurance activities; discuss the strengths and weaknesses of each approach; and suggest ways in which each approach could be effectively applied. The Board invites comment on all aspects of each approach. The Board will then use these comments to develop a specific proposal, likely based on these two approaches, and invite public comment on that specific proposal.

    A. Option 1: Building Block Approach

    The Board has traditionally set capital requirements for holding companies on a consolidated basis.15 Among other things, a consolidated capital standard deters firms from placing assets in a particular legal entity, where the assets may be subject to lower, or no, capital requirements. Many SLHCs that are supervised insurance institutions because they own depository institutions do not produce consolidated financial statements.16 This presents potential challenges to the development of consolidated capital requirements that would not impose undue burden on these institutions.

    15See 12 CFR part 217.

    16 Section 171(c)(3) of the Dodd-Frank Act, as amended, prohibits the Board from requiring, pursuant to the Dodd-Frank Act or HOLA, supervised institutions that only prepare financial statements in accordance with SAP to prepare financial statements in accordance with U.S. GAAP. 12 U.S.C. 5371(c)(3)(A)-(B).

    One approach that would accommodate this would aggregate capital resources and capital requirements across the different legal entities in the group to calculate combined qualifying and required capital. A firm's aggregate capital requirements generally would be the sum of the capital requirements at each subsidiary. This is a building block approach (BBA). The capital requirement for each regulated insurance or depository institution subsidiary would be based on the regulatory capital rules of that subsidiary's functional regulator—whether a state or foreign insurance regulator for insurance subsidiaries or a federal banking regulator for IDIs. The BBA would then build upon and aggregate legal entity (insurance, non-insurance financial, non-financial, and holding company) qualifying capital and required capital, subject to adjustments.

    Under this approach, the regulatory capital requirements for a regulated insurance underwriting firm would be determined by reference to the rules of the appropriate state or foreign insurance supervisor for the firm. The regulatory capital requirement for each IDI generally would be determined under the Board's Regulation Q or under other capital rules applicable to IDIs.17 The regulatory capital requirement for any other regulated non-insurance or unregulated subsidiary legal entity, such as a mid-tier holding company, would also be determined under the Board's Regulation Q.

    17 12 CFR part 217.

    As discussed further below, BBA may require the use of several types of adjustments in the calculation of a firm's enterprise-wide capital requirement. Adjustments may be necessary to conform or standardize the accounting practices under SAP among U.S. jurisdictions, and between SAP and foreign jurisdictions. Similarly, adjustments may be necessary to eliminate inter-company transactions.

    Additionally, the BBA may require consideration of cross-jurisdictional differences. As discussed below, this would be achieved through the use of scalars. Scalars may, for example, be appropriate to account for differences in stringency applied by different insurance supervisors, and to ensure adequate reflection of the safety and soundness and financial stability goals, as opposed to policyholder protection, that the Board is charged with achieving.

    The ratio of aggregate qualifying capital to aggregate required capital would represent capital adequacy at a consolidated level. Represented in an equation, the BBA could be summarized as follows:

    EP14JN16.000

    Question 6. What are the advantages and disadvantages of applying the BBA to the businesses and risks of supervised institutions significantly engaged in insurance activities?

    Question 7. What challenges and benefits do you foresee to the development, implementation, or application of the BBA? To what extent would the BBA utilize existing records, data requirements, and systems, and to what extent would the BBA require additional records, data, or systems? How readily could the BBA's calculations be performed across a supervised institution's subsidiaries and affiliates within and outside of the United States?

    Question 8. What scalars and adjustments are appropriate to implement the BBA, and make the BBA effective in helping to ensure resiliency of the firm and comparability among firms, while minimizing regulatory burden and incentives and opportunity to evade the requirements?

    Question 9. To what extent is the BBA prone to regulatory arbitrage?

    Question 10. Which jurisdictions or capital regimes would pose the greatest challenges to inclusion in the BBA?

    Question 11. How should the BBA apply to a supervised institution significantly engaged in insurance activity where the ultimate parent company is an insurer that is also regulated by a state insurance regulator? Are there other organizational structures that could present challenges?

    The key strengths of the BBA include the following: (1) It efficiently uses existing legal-entity-level regulatory capital frameworks; (2) it is an approach that could be developed and implemented expeditiously; (3) it would involve relatively low regulatory costs and burdens for the institutions; and (4) it would produce regulatory capital requirements that are tailored to the risks of each distinct jurisdiction and line of business of the institution.

    The key weaknesses of the BBA include: (1) At the top-tier level, it is an aggregated, but not a consolidated, capital framework; (2) it would not discourage regulatory arbitrage within an institution due to inconsistencies across jurisdictional capital requirements and also may be vulnerable to gaming through techniques such as double leverage (i.e., when an upstream entity issues debt to acquire an equity stake in a downstream entity); (3) it would need to account for inter-company transactions, which may result in extensive adjustments; (4) it would require the Board to determine scalars regarding a large number of state and foreign insurance regulatory capital regimes; and (5) it likely would require legal-entity-level stress tests, presenting challenges to appropriate reflection of diversification and inter-company risk transfer mechanisms and other transactions.

    The strengths of the BBA would appear to be maximized and its weakness minimized were the BBA to be applied to insurance depository institution holding companies, which generally are less complex, less international, and not systemically important. In this context, incremental safety and soundness benefits would appear to be complemented by the lower compliance costs due to the smaller number of scalars involved. In particular, the BBA is standardized, executable, applies U.S.-based accounting principles for U.S. legal entities, accounts for material insurance risks, strikes a balance between risk-sensitivity and simplicity, and is well-tailored to the business model and risks of insurance.18

    18 In addition, the BBA could be implemented in a manner consistent with section 171(c)(3) of the Dodd-Frank Act.

    For the systemically important insurance companies, the BBA may not capture the full set of risks these firms impose on the financial system without significant use of adjustments and scalars, thereby negating any potential burden reduction from the approach. These firms also tend to prepare financial statements under U.S. GAAP, thereby making a consolidated capital requirement less burdensome to compute. Accordingly, the BBA may not be appropriate for systemically important insurance companies.

    The Board continues to analyze whether the BBA is appropriate as a regulatory capital framework and whether it may be appropriate for all insurance depository institution holding companies or only a subset of these firms. Specifically, the Board is considering whether larger or more complex insurance depository institution holding companies should be subject to a regulatory capital framework other than the BBA.

    Question 12. Is the BBA an appropriate framework for insurance depository institution holding companies? How effective is the BBA at achieving the goal of ensuring the safety and soundness of an insurance depository institution holding company?

    Question 13. Would the BBA be appropriate for larger or more complex insurance companies that might in the future acquire a depository institution?

    Further, the Board seeks comment on the following key issues regarding the design and implementation of the BBA.

    Baseline capital requirements at the legal-entity level. The BBA framework would begin with the baseline capital requirements at each legal entity. For example, for state-regulated insurance entities, the BBA could use different triggering thresholds from the state risk-based capital framework (e.g., the Company Action Level, the Authorized Control Level), or some other level as the appropriate baseline capital requirement. For some regulated foreign insurance entities, the Board would need to decide whether the local minimum capital requirement, prescribed capital requirement, or some other requirement is the appropriate baseline. For subsidiary IDIs, the BBA could use the minimum common equity tier 1, tier 1, or total risk-based capital requirements under the standardized approach in the Board's Regulation Q, as well as the tier 1 leverage ratio. For unregulated subsidiaries, the BBA could use the risk-based capital or leverage requirements for depository institutions or some other, similarly stringent approach.

    Question 14. In applying the BBA, what baseline capital requirement should the Board use for insurance entities, banking entities, and unregulated entities?

    State-by-state and international variances in accounting or capital treatment for supervised institutions significantly engaged in insurance activities. The accounting practices for insurance companies can vary from state to state due to permitted and prescribed practices, and can result in significant differences in financial statements between similar entities filing SAP financial statements in different states. Regulators both within and outside of the U.S. have the authority to take actions with respect to insurance companies that may result in variances from standard accounting practices. The BBA would need to address international or state regulator approved variances in accounting or capital requirements for regulated insurance entities.

    Question 15. How should the BBA account for international or state regulator approved variances to accounting rules?

    Question 16. What are the challenges in using financial data under different accounting frameworks? What adjustments and/or eliminations should be made to ensure comparability when aggregating to an institution-wide level?

    Question 17. What approaches or strategies could the Board use to calibrate the various capital regimes without needing to make adjustments to the underlying accounting?

    Inter-company transactions. Any approach to regulatory capital for a supervised institution significantly engaged in insurance activities that aggregates qualifying capital and required capital at different legal entities within the institution should address inter-company transactions. Although inter-company transactions are naturally eliminated in consolidated accounting and regulatory frameworks, in an aggregated framework like the BBA, some inter-company transactions could generate redundancies in capital requirements, while others could reduce the required capital of a legal entity without reducing the overall risk profile of the institution. The BBA should include a treatment for inter-company transactions between different legal entities in the same supervised institution.

    Question 18. How should the BBA address inter-company transactions?

    Scalars. An important component of the BBA is that scalars would serve to bring jurisdictional capital frameworks to comparable levels of supervisory stringency. The BBA would need an appropriate scalar for each local regulatory capital regime, and therefore also would need a set of principles for determining those scalars. Any necessary scalars would be designed to reflect differences in supervisory purposes appropriate for insurance.

    Question 19. What criteria should be used to develop scalars for jurisdictions? What benefits or challenges are created through the use of scalars?

    Consolidation of qualifying capital. Under one version of a BBA framework, an insurance depository institution holding company or systemically important insurance company generally would determine its aggregate qualifying capital position by summing the qualifying capital position at each of its legal entities. A weakness of this approach is that it could enable the supervised institution to engage in substantial double leverage—that is, the institution's top-tier legal entity could fund its equity investments in its subsidiaries by substantial borrowings. Such an institution could have substantial qualifying capital positions at each of its major subsidiaries (and thus a robust BBA capital ratio) but could have a weak consolidated capital position.

    To address this limitation of a simple BBA, the Board is considering adopting a version of the BBA that would determine an institution's aggregate qualifying capital position on a uniform, consolidated basis. Under such an approach, the BBA would continue to draw upon capital requirements set by the local regulators of each legal entity, but would use a single definition of qualifying capital for supervised institutions and would apply that definition to the institution on a fully consolidated basis. To implement this version of the BBA, the Board would need to develop a definition of consolidated regulatory capital for supervised institutions significantly engaged in insurance activities, including rules to address minority interests.

    Question 20. What are the costs and benefits of a uniform, consolidated definition of qualifying capital in the BBA?

    Question 21. If the Board were to adopt a version of the BBA that employs a uniform, consolidated definition of qualifying capital, what criteria should the Board consider? What elements should be treated as qualifying capital under the BBA?

    Question 22. Should the Board categorize qualifying capital into multiple tiers, such as the approach used in the Board's Regulation Q? If so, what factors should the Board consider in determining tiers of qualifying capital for supervised institutions significantly engaged in insurance activities under the BBA?

    B. Option 2: Consolidated Approach

    The Board is also considering a consolidated approach (CA) to capital with risk segments and factors appropriate for supervised insurance institutions.

    The CA is a proposed capital framework for supervised institutions significantly engaged in insurance activities that would categorize insurance liabilities, assets, and certain other exposures into risk segments; determine consolidated required capital by applying risk factors to the amounts in each segment; define qualifying capital for the consolidated firm; and then compare consolidated qualifying capital to consolidated required capital. Unlike the BBA, which fundamentally aggregates legal-entity-level qualifying capital and required capital, the CA would take a fully consolidated approach to qualifying capital and required capital. As distinguished from the Board's consolidated capital requirements for bank holding companies, the CA would use risk weights and risk factors that are appropriate for the longer-term nature of most insurance liabilities.

    The foundation of the CA, for systemically important insurance companies, would be consolidated financial information based on U.S. GAAP, with adjustments for regulatory purposes. Application of the CA to insurance depository institution holding companies that do not file U.S. GAAP financial statements would require the development of a consolidated approach based on SAP. Initially, the CA could be simple in design, with broad risk segmentation, but could evolve over time to have an increasingly granular segmentation approach with greater risk sensitivity. Represented as an equation, the CA could be summarized as follows:

    EP14JN16.001

    Question 23. What are the advantages and disadvantages of applying the CA to the businesses and risks of supervised institutions significantly engaged in insurance activities?

    Question 24. What are the likely challenges and benefits to the development, implementation, and application of the CA? To what extent could the CA efficiently use existing records, data requirements, and systems, and to what extent would the CA require additional records, data, or systems?

    Question 25. To what extent would the CA be prone to regulatory arbitrage?

    The CA has strengths and weaknesses as a regulatory capital framework. The key strengths of the CA include the following: (1) It has a simple and transparent factor-based design; (2) it covers all material risks of supervised institutions significantly engaged in insurance activities; (3) it is a fully consolidated framework that has the potential to reduce regulatory arbitrage opportunities and the risk of double leverage; (4) it would be relatively expeditious for the Board to develop and for institutions to implement, particularly in light of its broad risk segmentation as implemented initially; and (5) it would provide a solid basis upon which to build consolidated supervisory stress tests of capital adequacy for institutions subject to stress testing requirements.

    The key weaknesses of the CA include the following: (1) The initially simple design of the CA would result in relatively crude risk segments and thus limited risk sensitivity, and (2) substantial analysis would be needed to design a set of risk factors for all the major segments of assets and insurance liabilities of supervised institutions significantly engaged in insurance activities. In addition, a separate SAP-based version of the CA would need to be developed for the insurance depository institution holding company population if CA were ever applied to an insurance depository institution holding company that only uses SAP.

    Based on the Board's initial analysis of the CA's strengths and weaknesses and comparing the CA against the considerations set forth above, it appears that the CA may be an appropriate regulatory capital framework for systemically important insurance companies. The CA, as a consolidated capital framework, would reduce the opportunity for regulatory arbitrage and the potential for double leverage. The CA also would more easily enable supervisory stress testing and other macroprudential features for systemically important insurance companies.

    The advantages of the CA are most salient for systemically important insurance companies that, by definition, are large, and internally and externally complex institutions. For insurance depository institution holding companies, which generally are smaller and less complex, these benefits may be outweighed by the additional implementation costs.

    Question 26. Is the CA an appropriate framework to be applied to systemically important insurance companies? What are the key challenges to applying the CA to systemically important insurance companies? How effective would the CA be at achieving the goals of ensuring the safety and soundness of a systemically important insurance company as well as minimizing the risk of a systemically important insurance company's failure or financial distress on financial stability?

    Question 27. What should the Board consider in determining more stringent capital requirements to address systemic risk? Should these requirements be reflected through qualifying capital, required capital, or both?

    Further, the Board seeks comment on the following key issues regarding the design and implementation of the CA.

    Definition of qualifying capital. Implementation of the CA would require the development of a uniform, consolidated definition of qualifying capital that is appropriate for all institutions subject to the CA.

    Question 28. What should the Board consider in developing a definition of qualifying capital under the CA? What elements should be treated as qualifying capital under the CA?

    Question 29. For purposes of the CA, should the Board categorize qualifying capital into multiple tiers? What criteria should the Board consider in determining tiers of qualifying capital for supervised institutions significantly engaged in insurance activities under the CA?

    Segmentation of exposures. Implementing the CA would require a framework for segmenting or disaggregating balance-sheet assets, balance-sheet insurance liabilities, and certain off-balance-sheet exposures. Appropriate segmentation would be important to ensure that similar risks face broadly similar capital requirements and that the capital regime produces an appropriate degree of risk sensitivity while minimizing the opportunities for regulatory arbitrage. This segmentation process would account for differences among insurance risks as well as between insurance risks and banking and other non-insurance, financial risks. While the initial version of the CA likely would have broad risk segments, the CA could evolve over time to become more risk sensitive. One option for implementing the CA for systemically important insurance companies would be to use the segmentation framework in the Board's proposed Consolidated Financial Statements for Insurance Systemically Important Financial Institutions.19

    19 81 FR 24097 (Apr. 25, 2016).

    Question 30. What risk segmentation should be used in the CA? What criteria should the Board consider in determining the risk segments? What criteria should the Board consider in determining how granular or risk sensitive the segmentation should be?

    Question 31. What challenges does U.S. GAAP present as a basis for segmentation in the CA?

    Question 32. What are the pros and cons of using the risk segmentation framework in the proposed Consolidated Financial Statements for Insurance Systemically Important Financial Institutions as the basis of risk segmentation for the CA?

    Exposure amounts. The CA would need to identify the exposure amounts of the various kinds of balance-sheet assets, balance-sheet insurance liabilities, and off-balance-sheet exposures of an institution. Although in many cases, the reported amount of a particular exposure may be appropriate for purposes of the CA, in other cases the financial information of an institution may require adjustments. For example, adjusting insurance liabilities may be necessary in order to include additional, relevant information, such as current assumptions, or to better match the valuation of related assets. Further, the CA would require the determination of the appropriate exposure amounts for derivatives and other off-balance-sheet items in order to accurately reflect the risk exposure in determining required capital.

    Question 33. How should the CA reflect off-balance-sheet exposures?

    Question 34. Under what circumstances should U.S. GAAP be used or adjusted to determine the exposure amount of insurance liabilities under the CA?

    Factors. The CA would involve a set of Board-determined factors to be applied to the exposure amounts of assets, insurance liabilities, and off-balance-sheet items in each risk segment. The factor for each risk segment would reflect the riskiness of the segment and the capital required to support that risk. Because of the different liability structures between insurance companies and banks, some of the applicable insurance risk factors may differ from the analogous risk factors that apply to banks.

    Question 35. What considerations should the Board apply in determining the various factors to be applied to the amounts in the risk segments in the CA?

    Question 36. What challenges are there in determining risk factors for global risks?

    Minimum ratio. The CA would require the establishment of a minimum ratio of consolidated qualifying capital to consolidated factor-weighted exposures in the CA. In addition, one or more definitions of capital adequacy (e.g., “well capitalized” or “adequately capitalized”) would be needed for early remediation and other supervisory purposes.

    Question 37. What criteria should the Board consider in developing the minimum capital ratio under the CA and definitions of a “well-capitalized” or “adequately capitalized” insurance institution?

    C. Other Assessed Frameworks

    In developing the two general approaches discussed here, the Board considered a number of other potential regulatory capital frameworks that did not appear to meet the Board's supervisory objectives for supervised institutions significantly engaged in insurance activities. For example, consideration was given to applying a risk-based capital rule that is based solely on the Board's existing capital requirements for banking organizations (Regulation Q) to supervised institutions significantly engaged in insurance activities. Such an approach would not recognize the unique risks, regulation, and balance sheet composition of insurance firms. Although bank-like capital requirements may be appropriate for exposures that a supervised institution significantly engaged in insurance activities holds in a non-insurance subsidiary, an approach based solely on the Board's Regulation Q would not capture significant insurance risks. The Board is not aware of any major country that imposes bank capital requirements on insurance firms.

    The Board also reviewed an approach that entirely excluded insurance subsidiaries and applied capital requirements only to the non-insurance parts of the supervised firm. This approach would, by definition, not capture all the material risks of the organization. While section 171 of the Dodd-Frank Act, as amended, permits the Board to exclude state and foreign regulated insurance entities in establishing minimum consolidated leverage and risk-based capital requirements, the parent holding company should be a source of capital strength to the entire entity, including to the subsidiary insurance companies and IDIs. To do this effectively, a consolidated capital requirement must take into account the risks within the consolidated organization, including insurance risks.

    A capital approach based on the European Solvency II framework was considered, but would not appear to be appropriate for systemically important insurance companies and insurance depository institution holding companies in the United States.20 Use of a Solvency II-based capital framework would not adequately account for U.S. GAAP and may introduce excessive volatility due to discount rate assumptions. Moreover, use of a Solvency II-based approach would involve excessive reliance on internal models. Internal models make cross-firm comparisons difficult and can lack transparency to supervisors and market participants. Additionally, such an approach would not be executable in the short-to-medium term; the notable challenges of the Solvency II regime have resulted in significantly extended implementation periods in various European jurisdictions.

    20See Council Directive 2009/138, On the Taking-Up and Pursuit of the Buisness of Insurance and Reinsurance (Solvency II), 2009 O.J. (L 335) 1 (EC).

    The Board also analyzed a potential regulatory capital framework for supervised institutions significantly engaged in insurance activities that is based on internal stress testing. This approach would rely on internal models, be highly novel and complex, would entail a large and lengthy construction project, and would require a substantial dedication of supervisory resources to superintend. The Board intends to continue exploration of internal stress testing as it builds its supervisory stress testing program for systemically important insurance companies and its broader supervision program for supervised institutions significantly engaged in insurance activities.

    Question 38. Should the Board reevaluate any of these approaches? What additional consideration, if any, should the Board give to any of the regulatory capital approaches discussed above?

    III. Conclusion

    The Board is seeking information on all aspects of its approaches to insurance regulatory capital and invites comment on the appropriate consolidated capital requirements for systemically important insurance companies and insurance depository institution holding companies. In addition, the Board invites comment on all of the questions set forth in this ANPR, as well as other issues that commenters may wish to raise.

    In connection with this ANPR, the Board will review all comments submitted and supplementary information provided, as well as information regarding insurance regulatory capital derived from the Board's regulatory and supervisory activities. Once the Board has completed its review, the Board anticipates that it will issue a notice of proposed rulemaking to establish a regulatory capital framework for supervised institutions significantly engaged in insurance activities.

    By order of the Board of Governors of the Federal Reserve System, June 9, 2016. Robert deV. Frierson, Secretary of the Board.
    [FR Doc. 2016-14004 Filed 6-13-16; 8:45 am] BILLING CODE 6210-01-P
    DEPARTMENT OF THE TREASURY Internal Revenue Service 26 CFR Parts 1 and 301 [REG-127923-15] RIN 1545-BM97 Consistent Basis Reporting Between Estate and Person Acquiring Property From Decedent; Hearing AGENCY:

    Internal Revenue Service (IRS), Treasury.

    ACTION:

    Notice of public hearing on proposed rulemaking.

    SUMMARY:

    This document provides notice of public hearing on the proposed regulations that provide guidance regarding the requirement that a recipient's basis in certain property acquired from a decedent be consistent with the value of the property as finally determined for Federal estate tax purposes.

    DATES:

    The public hearing is being held on Monday, June 27, 2016 at 10:00 a.m. The IRS must receive outlines of the topics to be discussed at the public hearing by Monday, June 20, 2016.

    ADDRESSES:

    The public hearing is being held in the IRS Auditorium, Internal Revenue Service Building, 1111 Constitution Avenue NW., Washington, DC 20224. Due to building security procedures, visitors must enter at the Constitution Avenue entrance. In addition, all visitors must present photo identification to enter the building.

    Send Submissions to CC:PA:LPD:PR (REG-127923-15), Room 5205, Internal Revenue Service, P.O. Box 7604, Ben Franklin Station, Washington, DC 20044. Submissions may be hand-delivered Monday through Friday to CC:PA:LPD:PR (REG-127923-15), Couriers Desk, Internal Revenue Service, 1111 Constitution Avenue NW., Washington, DC 20224 or sent electronically via the Federal eRulemaking Portal at www.regulations.gov (IRS-2016-0010).

    FOR FURTHER INFORMATION CONTACT:

    Concerning the regulations, Theresa M. Melchiorre at (202) 317-6859; concerning submissions of comments, the hearing and/or to be placed on the building access list to attend the hearing Regina Johnson at (202) 317-6901 (not toll-free numbers).

    SUPPLEMENTARY INFORMATION:

    The subject of the public hearing is the notice of proposed rulemaking (REG-127923-15) that was published in the Federal Register on Friday, March 4, 2016 (81 FR 11486).

    The rules of 26 CFR 601.601(a)(3) apply to the hearing. Persons who wish to present oral comments at the hearing that submitted written comments by June 20, 2016 must submit an outline of the topics to be addressed and the amount of time to be devoted to each topic by Monday, June 20, 2016.

    A period of 10 minutes is allotted to each person for presenting oral comments. After the deadline for receiving outlines has passed, the IRS will prepare an agenda containing the schedule of speakers. Copies of the agenda will be made available, free of charge, at the hearing or in the Freedom of Information Reading Room (FOIA RR) (Room 1621) which is located at the 11th and Pennsylvania Avenue NW., entrance, 1111 Constitution Avenue NW., Washington, DC 20224.

    Because of access restrictions, the IRS will not admit visitors beyond the immediate entrance area more than 30 minutes before the hearing starts. For information about having your name placed on the building access list to attend the hearing, see the FOR FURTHER INFORMATION CONTACT section of this document.

    Martin V. Franks, Chief, Publications and Regulations Branch, Legal Processing Division, Associate Chief Counsel (Procedure and Administration).
    [FR Doc. 2016-14010 Filed 6-13-16; 8:45 am] BILLING CODE 4830-01-P
    DEPARTMENT OF HOMELAND SECURITY Coast Guard 33 CFR Part 165 [Docket Number USCG-2016-0224] RIN 1625-AA00 Safety Zone; Fourth of July Fireworks Patriots Point, Charleston, SC AGENCY:

    Coast Guard, DHS.

    ACTION:

    Notice of proposed rulemaking.

    SUMMARY:

    The Coast Guard proposes to establish a temporary safety zone in the navigable waters of Charleston, SC. This safety zone is necessary to protect the public from hazards associated with launching fireworks over navigable waters of the United States. This proposed rulemaking would prohibit persons and vessels from being in the safety zone unless authorized by the Captain of the Port Charleston or a designated representative. We invite your comments on this proposed rulemaking.

    DATES:

    Comments and related material must be received by the Coast Guard on or before June 29, 2016.

    ADDRESSES:

    You may submit comments identified by docket number USCG-2016-0224 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 John Downing, Sector Charleston Office of Waterways Management, Coast Guard; telephone (843) 740-3184, 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, Purpose, and Legal Basis

    On March 10, 2016, The Patriots Point Maritime Museum notified the Coast Guard that it will be conducting a fireworks display from 9 p.m. to 9:30 p.m. on July 4, 2016. The fireworks are to be launched from a barge along the bank of the Cooper River at Patriots Point in Charleston, SC. Hazards from firework displays include accidental discharge of fireworks, dangerous projectiles, and falling hot embers or other debris. The Captain of the Port Charleston (COTP) has determined that potential hazards associated with the fireworks to be used in this display would be a safety concern for anyone within a 500-yard radius of the barge.

    The purpose of this rulemaking is to ensure the safety of vessels and the navigable waters within a 500-yard radius of the fireworks barge before, during, and after the scheduled event. The Coast Guard proposes this rulemaking under authority in 33 U.S.C. 1231.

    III. Discussion of Proposed Rule

    The COTP proposes to establish a safety zone from 8:45 p.m. to 9:45 p.m. on July 4, 2016. The safety zone would cover all navigable waters within 500 yards of the barge located at Patriots Point on the Cooper River. The duration of the zone is intended to ensure the safety of vessels and these navigable waters before, during, and after the scheduled 9 p.m. to 9:30 p.m. fireworks display. No vessel or person would be permitted to enter the safety zone without obtaining permission from the COTP or a designated representative. The regulatory text we are proposing appears at the end of this document.

    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.

    This regulatory action determination is based on the size, location, duration, and time-of-day of the safety zone. Vessel traffic would be able to safely transit around this safety zone which would impact a small designated area of the Atlantic Ocean for less than 1 hour during the evening when vessel traffic is normally low. Moreover, the Coast Guard would issue a Broadcast Notice to Mariners via VHF-FM marine channel 16 about the zone, and the rule would allow vessels to seek permission to enter 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 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 zone 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 (Pub. L. 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 proposed rule involves a safety zone lasting less than 1 hour that would prohibit entry within 500 yards of the fireworks barge. 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

    Harbors, 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 Department of Homeland Security Delegation No. 0170.1.

    2. Add temporary § 165.T07-0224 to read as follows:
    § 165.T07-0224 Safety zone; Fourth of July fireworks Patriots Point, Charleston, SC.

    (a) This rule establishes a safety zone on all Cooper River waters within a 500 yard radius of barge, from which fireworks will be launched.

    (b) Definition. 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 Charleston in the enforcement of the regulated areas.

    (c) Regulations. (1) All persons and vessels are prohibited from entering, transiting through, anchoring in, or remaining within the regulated area unless authorized by the Captain of the Port Charleston or a designated representative.

    (2) Persons and vessels desiring to enter, transit through, or remain within the regulated area may contact the Captain of the Port Charleston by telephone at 843-740-7050, or a designated representative via VHF radio on channel 16, to request authorization. If authorization to enter, transit through, or remain within the regulated area is granted by the Captain of the Port Charleston or a designated representative, all persons and vessels receiving such authorization must comply with the instructions of the Captain of the Port Charleston or a designated representative.

    (3) The Coast Guard will provide notice of the regulated area by Local Notice to Mariners, Broadcast Notice to Mariners, and on-scene designated representatives.

    (d) Enforcement period. This rule will be enforced on July 4, 2016 from 8:45 p.m. until 9:45 p.m.

    Dated: May 31, 2016. G.L. Tomasulo, Captain, U.S. Coast Guard, Captain of the Port Charleston.
    [FR Doc. 2016-13996 Filed 6-13-16; 8:45 am] BILLING CODE 9110-04-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR Parts 49 and 52 [EPA-HQ-OAR-2015-0782; FRL-9947-31-OAR] RIN 2060-AS56 Rescission of Preconstruction Permits Issued Under the Clean Air Act AGENCY:

    Environmental Protection Agency (EPA).

    ACTION:

    Proposed rule.

    SUMMARY:

    The U.S. Environmental Protection Agency (EPA) is proposing to revise a limitation on the rescission of stationary source preconstruction permits that is contained in the federal New Source Review (NSR) regulations. This proposal would amend the EPA's federal Prevention of Significant Deterioration (PSD) regulations to remove a date restriction from the current permit rescission provision. Other than removing the date restriction, the proposed rule is not intended to alter the circumstances under which an NSR permit may be rescinded. This proposal would also add a corresponding permit rescission provision in the federal regulations that apply to major sources in nonattainment areas of Indian country. This rule also proposes to correct an outdated cross-reference to another part of the regulations.

    DATES:

    Comments. Comments must be received on or before July 14, 2016.

    Public hearing. If anyone contacts us requesting a public hearing on or before June 20, 2016, we will hold a hearing. Additional information about the hearing, if requested, will be published in a subsequent Federal Register document.

    ADDRESSES:

    Submit your comments, identified by Docket ID No. EPA-HQ-OAR-2015-0782, at https://www.regulations.gov. 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, the full EPA public comment policy, information about CBI or multimedia submissions, and general guidance on making effective comments, please visit https://www.epa.gov/dockets/commenting-epa-dockets.

    FOR FURTHER INFORMATION CONTACT:

    For general information on this proposed rule, please contact Ms. Jessica Montanez, Office of Air Quality Planning and Standards, U.S. Environmental Protection Agency, by phone at (919) 541-3407 or by email at [email protected] To request a public hearing or information pertaining to a public hearing on this document, contact Ms. Pamela Long, Office of Air Quality Planning and Standards, U.S. Environmental Protection Agency, by phone at (919) 541-0641 or by email at [email protected]

    SUPPLEMENTARY INFORMATION: I. General Information A. How is this Federal Register document organized?

    The information presented in this document is organized as follows:

    I. General Information A. How is this Federal Register document organized? B. Does this action apply to me? C. What should I consider as I prepare my comments for the EPA? D. How can I find information about a possible public hearing? E. Where can I obtain a copy of this document and other related information? II. Overview of Action III. Background IV. Proposed Revisions A. Removal of Date Restriction B. Discretion of the Permitting Reviewing Authority C. Incorrect Cross Reference D. Rescission Authority for NA NSR Permits in Indian Country E. Rescission Authority for Other Air Permitting Programs F. Public Notice V. Implementation VI. Environmental Justice Considerations VII. 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 VIII. Statutory Authority B. Does this action apply to me?

    Entities potentially affected by this proposed rule include permit reviewing authorities responsible for the permitting of stationary sources of air pollution. This includes the EPA Regions, and both EPA-delegated air programs and EPA-approved air programs that are operated by state, local and tribal governments and that implement the federal NSR rules. Entities also potentially affected by this proposed rule include owners and operators of stationary sources that are subject to air pollution permitting under the Clean Air Act (CAA or Act).

    C. What should I consider as I prepare my comments for the EPA?

    1. Submitting CBI. Do not submit this information to the EPA through https://www.regulations.gov or email. Clearly mark the specific information that you claim to be CBI. For CBI in a disk or CD-ROM that you mail to the EPA, mark the outside of the disk or CD-ROM as CBI and then identify electronically within the disk or CD-ROM the specific information that is claimed as CBI. In addition to one complete version of the comment that includes information claimed as CBI, a copy of the comment that does not contain the information claimed as CBI must be submitted for inclusion in the public docket. Information so marked will not be disclosed except in accordance with procedures set forth in 40 Code of Federal Regulations (CFR) part 2.

    2. Tips for preparing comments. When submitting comments, remember to:

    • Identify the rulemaking by docket number and other identifying information (subject heading, Federal Register date and page number).

    • Follow directions. The proposed rule may ask you to respond to specific questions or organize comments by referencing a CFR part or section number.

    • Explain why you agree or disagree, suggest alternatives and substitute language for your requested changes.

    • Describe any assumptions and provide any technical information and/or data that you used to support your comment.

    • If you estimate potential costs or burdens, explain how you arrived at your estimate in sufficient detail to allow for it to be reproduced.

    • Provide specific examples to illustrate your concerns wherever possible, and suggest alternatives.

    • Explain your views as clearly as possible, avoiding the use of profanity or personal threats.

    • Make sure to submit your comments by the comment period deadline identified.

    D. How can I find information about a possible public hearing?

    To request a public hearing or information pertaining to a public hearing on this document, contact Ms. Pamela Long, Office of Air Quality Planning and Standards, U.S. Environmental Protection Agency, by phone at (919) 541-0641 or by email at [email protected]

    E. Where can I obtain a copy of this document and other related information?

    In addition to being available in the docket, an electronic copy of this Federal Register document will be posted at https://www.epa.gov/nsr/nsr-regulatory-actions. The docket contains, among other things, a comparison file that reflects how the proposed regulatory revisions compare to the current rules.

    II. Overview of Action

    The EPA is proposing to remove a date restriction by revising the permit rescission provision contained in its federal PSD permitting regulations. 40 CFR 52.21(w). This current provision authorizes the owner or operator of a stationary source that holds a PSD permit based on rules in effect on or before July 30, 1987, to request a rescission of their permit or a part of their permit. 40 CFR 52.21(w)(2).

    Through this rulemaking action, we are proposing to remove the July 30, 1987, date from the 40 CFR 52.21(w)(2) provision. Experience has shown that there can be circumstances where a permit based on rules in effect after July 30, 1987, may qualify for rescissions under the criteria in paragraph (w)(3) of the current regulations. In one recent instance, the EPA determined a need for rescission authority after the Supreme Court of the United States (Supreme Court) determined that PSD permits were not required for new sources or modifications to existing sources that only emit greenhouse gases (GHGs). However, because of the date restriction in the current rule, the EPA had to revise the regulation in order to enable permits to be rescinded, consistent with the Supreme Court's ruling. Thus, the EPA is proposing to remove the July 30, 1987, date restriction in order to eliminate the need for such actions in the future. We believe that removal of the date is justified to enable the rule to cover other cases where a rescission of a permit may be appropriate under the criteria in paragraph (w)(3) of the current permit rescission provision.

    Nevertheless, the EPA still intends to limit the rescission of permits to circumstances where the requirement for a source to meet the conditions of a major NSR permit is no longer present. Thus, we are not proposing to revise the criteria under which an owner or operator may qualify for rescission of an NSR permit. However, we are proposing to clarify that a rescission of a permit is not automatic; approval of a request for a rescission is contingent on an applicant's adequate demonstration that the permit is no longer needed and the permit reviewing authority's concurrence with the demonstration. Thus, a permit reviewing authority retains the discretion to deny a request for a permit rescission if it determines that the eligibility criteria are not satisfied.

    We are proposing to add a similar permit rescission provision under the major nonattainment NSR rules that apply in Indian country at 40 CFR part 49. This part of the federal NSR program currently does not contain a provision addressing the rescission of major nonattainment NSR permits in Indian country. This rulemaking action also proposes to correct a cross-reference in the current rule provision.

    III. Background

    The major NSR program contained in parts C and D of title I of the CAA is a preconstruction review and permitting program applicable to new major sources and major modifications at such sources. In areas meeting the National Ambient Air Quality Standards (NAAQS) (“attainment areas”) or for which there is insufficient information to determine whether the NAAQS are met (“unclassifiable areas”), the NSR requirements under part C of title I of the Act apply. We call this program the Prevention of Significant Deterioration program. In areas not meeting the NAAQS (“nonattainment areas”), the preconstruction permitting program is required under part D of the CAA. We call this program the Nonattainment NSR (NA NSR) program. Collectively, we also commonly refer to these two programs as the major NSR program. These rules are contained in 40 CFR 51.165, 51.166, 52.21 and 52.24 and 40 CFR part 51, appendices S and W.1 The CAA also requires that State Implementation Plans (SIP) include measures to assure that achievement of the NAAQS is not impeded by construction of other sources that are not subject to the major NSR requirements. We call this program “minor NSR.”

    1 In addition, the major NA NSR rules that apply in Indian country can be found at 40 CFR part 49.

    While the CAA establishes requirements for the permitting of construction of new major sources or modifications of such sources, it does not specify how long a permit is to remain in effect or whether there are circumstances under which an NSR permit may be invalidated or rescinded. See, e.g., CAA section 165. The EPA has interpreted this silence to mean that an NSR permit should remain in effect for as long as the new or modified source continues to operate. However, the absence of a statutory provision on the continuing viability of and need for a permit does not suggest that the EPA lacks the authority and discretion to rescind a permit under some circumstances, such as when a final court ruling clarifies the meaning of some part of the CAA. Over the years, the EPA has used this authority and discretion to rescind permits under limited circumstances.

    40 CFR 52.21(w) authorizes an owner or operator of a source to request, and the EPA Administrator 2 to grant, a rescission of a PSD permit if the owner or operator shows that the PSD regulations do not apply.

    2 The rescission regulation at 40 CFR 52.21(w) is intended to be a delegable authority. The use of the term “Administrator” in our regulations is not intended to impede delegation. For example, for federally-issued permits, since the EPA Regional offices issue the permits in their jurisdictions, rescission authority is typically delegated—usually to either an EPA Regional Administrator or Division Director.

    The original intent of the 40 CFR 52.21(w) provision was to create a means by which a limited category of sources that received a permit under the EPA's 1978 PSD regulations could be relieved of the requirements of their permits, after the United States Court of Appeals for the District of Columbia Circuit (D.C. Circuit) determined that portions of those regulations were inconsistent with the CAA. The sources in question were ones that would no longer be considered “major” under our 1980 amendments to the PSD regulations, which were promulgated in response to the D.C. Circuit Court ruling.3 The original paragraph (w) only applied to permits issued under the regulations in effect between June 19, 1978 (the date the first PSD regulations were published in the Federal Register), and August 7, 1980 (the effective date of the PSD amendments that included the new paragraph (w)).

    3 August 7, 1980, 45 FR 52676.

    In 1987, the EPA revised 40 CFR 52.21(w) to change the effective date requirement to apply to permits that were issued based on rules in effect on or before July 30, 1987. See 52 FR 24672, 24689 (July 1, 1987). The EPA made this revision in concert with its amendments to the NAAQS for particulate matter (PM), which, among other things, transitioned the PM pollution indicator from total suspended particles to PM10. This revision of 40 CFR 52.21(w) effectively enabled rescission authority to apply to sources and modifications that were no longer major using the new PM10 indicator. Thus, the July 30, 1987, date stipulation that remains in 40 CFR 52.21(w) is an artifact of the 1987 regulatory revisions to transition to the revised PM10 indicator.

    Following the changes made in 1987, 40 CFR 52.21(w) remained unchanged until almost three decades later when the EPA revised 40 CFR 52.21(w), in response to a Supreme Court decision, to expressly allow rescission of permits granted for sources based solely on the emissions of GHGs.4 See May 7, 2015; 80 FR 26183. This 2015 regulatory action did not revise or remove the July 30, 1987, date, but was a targeted effort to expeditiously authorize the rescission of PSD permits that were required solely based on GHG emissions.

    4 The Supreme Court determined that the EPA may not treat GHGs as an air pollutant for purposes of determining whether a source is a major source (or a modification thereof) required to obtain a PSD permit. UARG v. EPA, 134 S. Ct. 2427 (2014). In accordance with the Supreme Court decision, on April 10, 2015, the D.C. Circuit issued an amended judgment vacating portions of the particular provisions of the EPA's regulations implementing the EPA's PSD and Title V GHG Tailoring Rule. On August 19, 2015, the EPA amended its PSD regulations to remove from the Code of Federal Regulations portions of those regulations that the D.C. Circuit specifically identified as vacated.

    However, in the preamble to that 2015 rule, the EPA signaled its intent to undertake a subsequent rulemaking action to apply the permit rescission provision to permits issued after July 30, 1987, and to eliminate the need to conduct targeted rulemakings in the future. 80 FR 26186.

    The current regulations require that the Administrator provide adequate public notice of the final permit rescission determination. Thus, the provision does not require that the EPA provide advance notice of the permit rescission determination. However, we believe that public notice and comment procedures—similar to those used when proposing a draft permit—may be appropriate in certain circumstances. This could occur when a permit rescission determination is not straightforward (e.g., possible differences in interpretation over the change in the law that is the basis for the rescission request) or when there is increased public interest in the facility requesting a permit rescission. In these cases, while prior notice of the permit rescission determination is not required, the permit reviewing authority has discretion to provide notice of the rescission and to solicit comment (e.g., by way of a public announcement or public hearing) before finalizing a permit rescission determination. Having this additional public input could be very important if the rescission is controversial in nature. This is consistent with the approach the EPA has recommended recently in guidance on permit extensions.5

    5 Memorandum from Stephen D. Page, Director, Office of Air Quality Planning and Standards, Guidance on Extension of Prevention of Significant Deterioration (PSD) Permits under 40 CFR 52.21(r)(2) (January 31, 2014). https://www.epa.gov/sites/production/files/2015-07/documents/extend14.pdf.

    Furthermore, the EPA interprets 40 CFR 124.15 of its regulations to apply to a number of PSD permit actions, including permit rescissions.6 Thus, a decision to rescind a PSD permit is a “final permit decision” under 40 CFR 124.15. As a result, under 40 CFR 124.19, a decision to rescind a permit under 40 CFR 52.21(w) is subject to review by the EPA's Environmental Appeals Board. After this appeal procedure is exhausted, a permit rescission determination may, under CAA 307(b)(1), be subject to judicial review in the United States Court of Appeals for the appropriate circuit.

    6 40 CFR 124.15(a) uses the term “terminate,” which is synonymous with a rescission of a permit.

    IV. Proposed Revisions

    These proposed revisions are intended to provide greater flexibility and clarity for improved implementation of the permit rescission provision. The specific proposed changes are explained in this section, and we are requesting comment on all aspects of this proposal.

    A. Removal of Date Restriction

    In this action, the EPA proposes to remove the date restriction of July 30, 1987, from the current 40 CFR 52.21(w) provision. This approach is consistent with our recent rule to authorize rescission of specific types of permits issued after July 30, 1987, in response to a decision by the Supreme Court regarding GHGs. If the EPA finalizes this proposed revision, rescission authority would extend to PSD permits issued after this date when the applicant shows that the requirements of 40 CFR 52.21 “would not apply to the source or modification.” In addition, the specific language in paragraphs (w)(2) and (w)(3) that the EPA added in 2015 to accommodate the rescission of certain types of GHG PSD permits would no longer be required, so we are concurrently proposing in this action to delete the GHG permit rescission language adopted in the 2015 rulemaking.

    As explained in the “Background” section of this preamble, the creation of the original rescission provision was aimed at addressing a specific need with regard to responding to the D.C. Circuit Court decision in Alabama Power. 7 In 1987, the EPA recognized another circumstance in which rescission of permits may be justified—the change of the PM indicator to PM10. In 2015, the EPA identified an additional need to extend the rescission authority beyond its original scope after the Supreme Court decision regarding GHGs. Thus, over the years, the EPA has periodically found a need to expand the rescission provision through a regulatory action beyond its original scope as new circumstances have arisen. These and other experiences since 1980 have shown that there is a periodic need to utilize PSD permit rescission authority. We would expect this pattern to continue in the event of additional court decisions that narrow the scope of sources required to obtain a PSD permit. Where a source obtained a PSD permit in reliance on the EPA regulations that a court subsequently determined to be unnecessary or inappropriate, the EPA would expect to conclude that 40 CFR 52.21 “would not apply to the source or modification.” Furthermore, the EPA recognizes there could be circumstances not previously considered by the EPA that may lead a source to request a rescission of their permit and a permit reviewing authority to grant the request.

    7Alabama Power Company v. Costle, 606 F.2d 1068 (D.C. Cir. 1979), modified, 636 F.2d 323 (D.C. Cir. 1979).

    The EPA is not proposing to change the criteria under which an owner or operator may qualify for rescission of an NSR permit. Requests for permit rescission are very case-specific and require an in-depth evaluation of the source, the rules in place at the time, and the court decisions or other events affecting the source before it can be shown that the requirements of 40 CFR 52.21 “would not apply to the source or modification.”

    Thus, we are proposing to eliminate the date restriction so that the EPA—and other permitting authorities that implement 40 CFR 52.21(w)—may in the future consider, on a case-by-case basis, whether a source that requests a permit rescission is eligible for rescission of its permit. The regulatory change we are proposing is limited in nature, and the EPA continues to believe that rescission is appropriate only in limited circumstances. This is because the EPA views the role of the NSR program to authorize the construction and initial operation of a source or a modification and, assuming the source was constructed as originally permitted, there should be very few cases in which the original authorization should be rescinded.

    B. Discretion of the Permitting Reviewing Authority

    While we are proposing to retain the criteria under which a rescission is authorized, we are also proposing to clarify that the rescission of a permit requires an exercise of discretion by the permit reviewing authority. In this action, the EPA proposes to revise 40 CFR 51.21(w)(3) to make it clear that the provision does not create a mandatory duty on the Administrator to grant a rescission request.

    The 1980 preamble speaks of the EPA needing “adequate information with which to make a sound decision” to rescind a permit. It also states that it “will have the expertise and objectivity necessary to check adequately whether the permittee has applied the intricate applicability rules correctly.” August 7, 1980; 45 FR 52682. Thus, the responsible authority at the permitting agency has always had the authority to grant or deny a rescission request based on an analysis of the request for a permit rescission and a determination of whether it is appropriate to grant or deny the request to rescind the permit. The EPA believes that it is appropriate to view the existing 40 CFR 52.21(w)(3) provision as a whole, including the last phrase “. . . if the application shows that this section would not apply to the source or modification.” We believe that the second phrase conditions the first phrase (“The Administrator shall grant an application for rescission”) on the fact that an adequate demonstration must be made by the permit applicant.

    Thus, the EPA is proposing to replace the word “shall” with the word “may” in this provision, without making any other revision to 40 CFR 52.21(w)(3). This revision is intended to make clear that the Administrator may deny a permit rescission request if he or she does not concur with the analysis by the permit applicant that 40 CFR 52.21 “would not apply to the source or modification.” The EPA does not believe this changes the meaning or intent of the existing provision, but rather clarifies the approvability of the request by the Administrator.

    C. Incorrect Cross Reference

    We are proposing to correct the first paragraph of (w), which has an incorrect cross reference. Paragraph (w)(1) currently references 40 CFR 52.21 paragraph (s), but 40 CFR 52.21(s) pertains to environmental impact statements and does not address the expiration of a permit.

    We are therefore proposing to revise the reference in paragraph (w)(1) to refer to paragraph (r), which addresses permit expiration. 40 CFR 52.21(r)(2)

    D. Rescission Authority for NA NSR Permits in Indian Country

    This action also proposes to add a provision to 40 CFR 49.172 to provide rescission authority for major NA NSR permits in Indian country. The EPA proposes that the provision added to 40 CFR 49.172 would be similar to the provision at 40 CFR 52.21(w) and would reflect the public notice requirements included in that rule. The EPA believes it is appropriate to allow rescission of NA NSR permits in Indian country in limited, case-specific circumstances for the same reasons it is appropriate to allow rescission of PSD permits in narrow circumstances.

    Creating a rescission provision in 40 CFR part 49 for major NA NSR permits in Indian country would ensure that all federal programs for major source permitting have rescission authority. PSD permits issued to sources in Indian country are federal permits and consequently subject to 40 CFR 52.21, so they would be subject to the same revisions to 40 CFR 52.21 that are being proposed in this action.

    E. Rescission Authority for Other Air Permitting Programs

    In the case of sources in the Outer Continental Shelf (OCS), the EPA's OCS air regulations at 40 CFR 55 establish the applicable requirements, which include federal air pollution preconstruction permit requirements. 40 CFR part 55 refers to rescinding a preconstruction permit issued to an OCS source and incorporates by reference 40 CFR 52.21. Thus, any regulatory revisions to 40 CFR 52.21(w) would automatically apply to applicable permit requirements incorporated in part 55. See 40 CFR 55.6(b)(5) and 55.13(d). As a result, the EPA does not see a need to revise the Part 55 permitting regulations.

    While the EPA's regulations for SIP-approved programs in 40 CFR 51.165 and 51.166 do not include provisions for permit rescissions, we have previously stated that we would approve such provisions if states were to adopt them.8 In addition, this rule is not intended to alter minor source construction permit requirements that may apply in the place of major NSR permit conditions that are no longer applicable to a source modification.

    8See August 7, 1980; 45 FR 52686 and 52688.

    Consequently, we are proposing that the rules on rescinding preconstruction permits would only reside in the federal major NSR program rules at 40 CFR parts 49 and 52 (and, by extension, part 55 as noted previously). The EPA has previously explained that other permit reviewing authorities are free to adopt our rescission rule provisions or propose their own and request approval by the EPA.

    F. Public Notice

    We note that a forthcoming EPA rule has proposed to amend the second sentence of paragraph (w)(4) of 40 CFR 52.21 to remove the mandatory newspaper notice requirement and to require electronic noticing of rescission determinations. See December 29, 2015; 80 FR 81234. We are not taking comment on these separately proposed revisions to paragraph (w)(4) of 40 CFR 52.21 in this rule proposal, and we direct the reader to that separate rulemaking for further information with regard to the noticing of permit rescissions. In this action, the EPA is not proposing to revise 40 CFR 52.21(w)(4) in the permit rescission provision.

    V. Implementation

    Upon promulgating this action, the rule would become effective within 30 days for permit reviewing authorities that implement the federal program rules at 40 CFR parts 49 and 52. This includes the EPA Regions and other permit reviewing authorities that are delegated authority by the EPA to issue PSD permits on behalf of the EPA (via a delegation agreement) and permit reviewing authorities that have their own PSD rules approved by the EPA in a SIP and the SIP incorporates by reference 40 CFR 52.21(w) and automatically updates when the federal rules are amended. Since this action is not amending 40 CFR part 51, there are no implementation requirements for permit reviewing authorities that implement the part 51 regulations through an approved SIP.

    VI. Environmental Justice Considerations

    We do not believe that these proposed revisions and additions to the rescission of federal major NSR permits would have any effect on environmental justice communities.

    VII. 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 not a significant regulatory action and was therefore not submitted to the Office of Management and Budget (OMB) for review.

    B. Paperwork Reduction Act (PRA)

    This action does not impose any new information collection burden under the PRA. OMB has previously approved the information collection activities contained in the existing regulations and has assigned OMB control numbers 2060-0003 for the PSD and NA NSR permit programs. We believe that the burden associated with rescinding federal NSR permits is already accounted for under the approved information collection requests.

    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. This action will not impose any requirements on small entities. Entities potentially affected directly by this proposal include state, local and tribal governments, and none of these governments would qualify as a small entity. Other types of small entities are not directly subject to the requirements of this action.

    D. Unfunded Mandates Reform Act (UMRA)

    This action does not contain any unfunded federal mandate as described in UMRA, 2 U.S.C. 1531-1538, and does not significantly or uniquely affect small governments. The action imposes no enforceable duty on any state, local or tribal governments or the private sector.

    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.

    F. Executive Order 13175: Consultation and Coordination With Indian Tribal Governments

    This action does not have tribal implications as specified in Executive Order 13175. Specifically, these proposed revisions do not affect the relationship or distribution of power and responsibilities between the federal government and Indian tribes. Thus, Executive Order 13175 does not apply to this action.

    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 concern 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 subject to Executive Order 13211 because it is not a significant regulatory action under Executive Order 12866.

    I. National Technology Transfer and Advancement Act

    This rulemaking 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 minority, low-income or indigenous populations because it does not affect the level of protection provided to human health or the environment.

    VIII. Statutory Authority

    The statutory authority for this action is provided by 42 U.S.C. 7401, et seq.

    List of Subjects 40 CFR Part 49

    Environmental protection, Administrative practice and procedure, Air pollution control

    40 CFR Part 52

    Environmental protection, Air pollution control, Incorporation by reference.

    Dated: May 27, 2016. Gina McCarthy, Administrator.

    For the reasons stated in the preamble, title 40, chapter I of the Code of Federal Regulations is proposed to be amended as follows:

    PART 49—INDIAN COUNTRY: AIR QUALITY PLANNING AND MANAGEMENT 1. The authority citation for part 49 continues to read as follows: Authority:

    42 U.S.C. 7401, et seq.

    Subpart C—General Federal Implementation Plan Provisions 2. Section 49.172 is amended by adding paragraph (f) to read as follows:
    § 49.172 Final permit issuance and administrative and judicial review.

    (f) Can my permit be rescinded?

    (1) Any permit issued under this section or a prior version of this section shall remain in effect until it is rescinded under this paragraph.

    (2) An owner or operator of a stationary source or modification who holds a permit issued under this section for the construction of a new source or modification that meets the requirement in paragraph (f)(3) of this section may request that the reviewing authority rescind the permit or a particular portion of the permit.

    (3) The reviewing authority may grant an application for rescission if the application shows that this section would not apply to the source or modification.

    (4) If the reviewing authority rescinds a permit under this paragraph, the public shall be given adequate notice of the rescission determination in accordance with one or more of the following methods:

    (i) The reviewing authority may mail or email a copy of the notice to persons on a mailing list developed by the reviewing authority consisting of those persons who have requested to be placed on such a mailing list.

    (ii) The reviewing authority may post the notice on its Web site.

    (iii) The reviewing authority may publish the notice in a newspaper of general circulation in the area affected by the source. Where possible, the notice may also be published in a Tribal newspaper or newsletter.

    (iv) The reviewing authority may provide copies of the notice for posting at one or more locations in the area affected by the source, such as Post Offices, trading posts, libraries, Tribal environmental offices, community centers or other gathering places in the community.

    (v) The reviewing authority may employ other means of notification as appropriate.

    PART 52—APPROVAL AND PROMULGATION OF IMPLEMENTATION PLANS 3. The authority citation for part 52 continues to read as follows: Authority:

    42 U.S.C. 7401, et seq.

    Subpart A—General Provisions 4. Section 52.21 is amended by revising paragraphs (w)(1) through (3) to read as follows:
    § 52.21 Prevention of significant deterioration of air quality.

    (w) * * *

    (1) Any permit issued under this section or a prior version of this section shall remain in effect, unless and until it expires under paragraph (r) of this section or is rescinded under this paragraph.

    (2) An owner or operator of a stationary source or modification who holds a permit issued under this section for the construction of a new source or modification that meets the requirement in § 52.21 paragraph (w)(3) may request that the Administrator rescind the permit or a particular portion of the permit.

    (3) The Administrator may grant an application for rescission if the application shows that this section would not apply to the source or modification.

    [FR Doc. 2016-13303 Filed 6-13-16; 8:45 am] BILLING CODE 6560-50-P
    ENVIRONMENTAL PROTECTION AGENCY 40 CFR Parts 70 and 71 [EPA-HQ-OAR-2016-0186; FRL-9947-56-OAR] RIN 2060-AS96 Removal of Title V Emergency Affirmative Defense Provisions From State Operating Permit Programs and Federal Operating Permit Program AGENCY:

    Environmental Protection Agency (EPA).

    ACTION:

    Proposed rule.

    SUMMARY:

    The Environmental Protection Agency (EPA) is proposing to remove the affirmative defense provisions for emergencies found in the regulations for state and federal operating permit programs. These provisions establish an affirmative defense that sources can assert in civil enforcement cases when noncompliance with certain emission limitations in operating permits occurs because of qualifying “emergency” circumstances. These provisions, which have never been required elements of state operating permit programs, are being removed because they are inconsistent with the enforcement structure of the Clean Air Act (CAA) and recent court decisions from the U.S. Court of Appeals for the D.C. Circuit. The removal of these provisions is consistent with other recent EPA actions involving affirmative defenses and would harmonize the enforcement and implementation of emission limitations across different CAA programs. The EPA is also taking comment on various implementation consequences relating to the proposed removal of the emergency affirmative defense provisions.

    DATES:

    Comments. Comments must be received on or before August 15, 2016.

    Public Hearing: If anyone contacts the EPA requesting a public hearing on or before June 29, 2016, the EPA will hold a hearing. Additional information about the hearing, if requested, will be published in a subsequent Federal Register document.

    ADDRESSES:

    Submit your comments, identified by Docket ID No. EPA-HQ-OAR-2016-0186, at http://www.regulations.gov. 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, 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.

    FOR FURTHER INFORMATION CONTACT:

    For general information, please contact Mr. Matthew Spangler, U.S. Environmental Protection Agency, Office of Air Quality Planning and Standards, Air Quality Planning Division (C504-05), Research Triangle Park, NC 27711; telephone number: (919) 541-0327; email address: [email protected] To request a public hearing or information pertaining to a public hearing on this document, contact Ms. Pamela Long, U.S. Environmental Protection Agency, Office of Air Quality Planning and Standards, Air Quality Planning Division (C504-01), Research Triangle Park, NC 27711; telephone number (919) 541-0641; fax number (919) 541-5509; email address: [email protected]

    SUPPLEMENTARY INFORMATION:

    I. General Information A. How is this Federal Register notice organized?

    The information presented in this preamble is organized as follows:

    I. General Information A. How is this Federal Register notice organized? B. Does this action apply to me? C. What should I consider as I prepare my comments for the EPA? D. How can I find information about a possible public hearing? E. Where can I get a copy of this document and other related information? II. Overview of Action III. Background A. Regulatory History of 40 CFR 70.6(g) and 71.6(g) B. Subsequent Legal and Regulatory History Supporting This Action IV. Proposed Changes to Part 70 and Part 71 Regulations A. Purpose of This Proposed Rulemaking B. Proposed Action: Removal of 40 CFR 70.6(g) and 71.6(g) C. Legal Justification for Proposed Action V. Implementation A. Implementing These Changes in Part 70 State Operating Permit Programs B. Implementing These Changes in the Part 71 Federal Operating Permit Program C. Effect on Sources Potentially Subject to Enforcement Proceedings VI. Environmental Justice Considerations VII. 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 (URMA) 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 VIII. Statutory Authority B. Does this action apply to me?

    Entities potentially affected by this proposed rulemaking include federal, state, local and tribal air pollution control agencies that administer title V operating permit programs 1 and owners and operators of emissions sources in all industry groups who hold or apply for title V operating permits.

    1 This preamble makes frequent use of the term “state,” usually meaning the state air pollution control agency that serves as the permitting authority. The use of the term “state” also applies to local and tribal air pollution control agencies, where applicable.

    C. What should I consider as I prepare my comments for the EPA? 1. Submitting CBI

    Do not submit CBI to the EPA through http://www.regulations.gov or email. Clearly mark the part or all of the information that you claim to be CBI. For CBI information in a disk or CD-ROM that you mail to the EPA, mark the outside of the disk or CD-ROM as CBI and then identify electronically within the disk or CD-ROM the specific information that is claimed as CBI. In addition to one complete version of the comment that includes information claimed as CBI, a copy of the comment that does not contain the information claimed as CBI must be submitted for inclusion in the public docket. Information so marked will not be disclosed except in accordance with procedures set forth in 40 CFR part 2.

    2. Tips for Preparing Your Comments

    When submitting comments, remember to:

    • Identify the rulemaking by docket number and other identifying information (subject heading, Federal Register date and page number).

    • Follow directions. The agency may ask you to respond to specific questions or organize comments by referencing a Code of Federal Regulations (CFR) part or section number.

    • Explain why you agree or disagree; suggest alternatives and substitute language for your requested changes.

    • Describe any assumptions and provide any technical information and/or data that you used.

    • If you estimate potential costs or burdens, explain how you arrived at your estimate in sufficient detail to allow for it to be reproduced.

    • Provide specific examples to illustrate your concerns, and suggest alternatives.

    • Explain your views as clearly as possible, avoiding the use of profanity or personal threats.

    • Make sure to submit your comments by the comment period deadline identified.

    D. How can I find information about a possible public hearing?

    If anyone contacts the EPA requesting a public hearing on or before June 29, 2016, the EPA will hold a hearing. If requested, further details concerning a public hearing for this proposed rule will be published in a subsequent Federal Register document. For updates and additional information on a public hearing, please check the EPA's Web page at https://www.epa.gov/title-v-operating-permits/current-regulations-and-regulatory-actions.

    E. 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 Federal Register document will be posted at https://www.epa.gov/title-v-operating-permits/current-regulations-and-regulatory-actions.

    II. Overview of Action

    The EPA has promulgated permitting regulations for the operation of major and certain other sources of air pollutants under title V of the CAA. These regulations are codified in 40 CFR parts 70 and 71, which contain the requirements for state operating permit programs and the federal operating permit program, respectively. These regulations currently contain identical provisions setting forth an affirmative defense to enforcement actions brought for noncompliance with technology-based emission limitations under specific “emergency” circumstances. See 40 CFR 70.6(g) and 71.6(g).

    In this action, the EPA is proposing to remove the emergency affirmative defense provisions in 40 CFR 70.6(g) and 71.6(g) because they are inconsistent with the EPA's current interpretation of the CAA's enforcement structure and recent court decisions from the U.S. Court of Appeals for the D.C. Circuit. These provisions have never been required elements of state operating permit programs. The removal of these provisions is consistent with other recent EPA actions involving affirmative defenses and would help harmonize the enforcement and implementation of emission limitations across different CAA programs.

    If the EPA takes final action to remove these provisions from 40 CFR 70.6(g), it may be necessary for any states that have adopted similar affirmative defense provisions into their part 70 operating permit programs to revise their program regulations to remove these provisions. In addition, the EPA expects that these states would coordinate revisions of individual operating permits that contain similar provisions.

    III. Background A. Regulatory History of 40 CFR 70.6(g) and 71.6(g)

    In 1990, Congress amended the CAA and established, among other things, title V of the CAA, which contains a national operating permit program for certain stationary sources of air pollution. See CAA sections 501-503, Public Law 101-549 (1990) (codified at 42 U.S.C. 7661-7661b). Shortly thereafter, and pursuant to CAA section 502(b), the EPA promulgated regulations implementing title V of the CAA. The first set of regulations, finalized in 1992 and codified at 40 CFR part 70 (the part 70 regulations), governs state operating permit programs and provides for states to develop and submit to the EPA programs for issuing operating permits for major and certain other stationary sources of air pollution.2 Pursuant to CAA section 502(d)(3), the EPA promulgated a second set of regulations in 1996, found at 40 CFR part 71 (the part 71 regulations), which outlines the federal operating permit program.3 Both sets of regulations contain identical affirmative defense provisions, which are addressed by this action.

    2 Operating Permit Program, Final Rule, 57 FR 32250 (July 21, 1992).

    3 Federal Operating Permits Program, Final Rule, 61 FR 34202 (July 1, 1996).

    Title V of the CAA does not contain any provisions concerning an affirmative defense mechanism for emergencies. When the EPA first proposed its part 70 regulations in 1991, the agency did not include any such provisions.4 However, the EPA received comments specifically requesting that the part 70 regulations make some provision for “emergencies” or “upsets” caused by the failure of emission control equipment. In promulgating the final part 70 regulations for state operating permit programs, the EPA included § 70.6(g), which contains an affirmative defense for “emergencies.” 5 When the EPA promulgated its part 71 regulations in 1996, it adopted an identical provision in § 71.6(g), in order to maintain consistency between the state and federal operating permit programs.6 The text of sections 70.6(g) and 71.6(g) has not changed since initially promulgated.

    4 Operating Permit Program, Proposed Rule, 56 FR 21712 (May 10, 1991).

    5 Operating Permit Program, Final Rule, 57 FR 32279. The EPA explained that the provision was intended to provide operational flexibility, and was modeled on a similar National Pollutant Discharge Elimination System (NPDES) permit provision in 40 CFR 122.41. Id.

    6 Federal Operating Permits Program, Final Rule, 61 FR 34219 (July 1, 1996).

    The title V emergency provisions establish an affirmative defense. A stationary source of air pollution can assert this affirmative defense in an enforcement case to avoid liability for noncompliance with technology-based emission limits contained in the source's title V permit. In order to use this affirmative defense and avoid liability, the source must demonstrate that any excess emissions occurred as the result of an “emergency,” as defined in the regulations, and make a number of other demonstrations specified in the regulations. See 40 CFR 70.6(g) and 71.6(g). These title V affirmative defense provisions apply in addition to, and independently from, any emergency or upset provisions contained in other applicable CAA requirements.

    Sections 70.6(g) and 70.4(b)(16) form the basis for similar affirmative defense provisions contained in state operating permit programs and for similar provisions contained in individual state-issued operating permits. Section 71.6(g) provides the authority to include this emergency provision in operating permits issued by the EPA or by states with delegated authority under part 71.

    Such emergency affirmative defense provisions are not required program elements. States have never been obligated to include the § 70.6(g) affirmative defense provision in their part 70 operating permit programs; instead, the provision has always been discretionary.7 Similarly, although the emergency affirmative defense provision is located within the “Permit Content” section of the part 70 and part 71 regulations, the EPA does not consider the provision to be a required permit term.8 Thus, the EPA considers the emergency provision to be a discretionary element of both state permitting programs as well as individual operating permits.

    7 Operating Permits Program and Federal Operating Permits Program, Proposed Rule [Title V Supplemental Proposal], 60 FR 45530, 45558 (August 31, 1995) (“At the outset, EPA wants to make clear that the part 70 rule does not require that States adopt the emergency defense. A State may include such a defense in its part 70 program to the extent it finds appropriate, although it may not adopt an emergency defense less stringent than that set forth at section 70.6(g). . . . [T]he Act in sections 116 and 506(a) authorizes States to establish additional or more stringent air pollution control or permitting requirements. Consistent with that, States may decide to provide an emergency defense that is narrower in scope or more stringent in application than § 70.6(g) or no defense at all.”).

    8See State Implementation Plans: Response to Petition for Rulemaking; Restatement and Update of EPA's SSM Policy Applicable to SIPs; Findings of Substantial Inadequacy; and SIP Calls To Amend Provisions Applying to Excess Emissions During Periods of Startup, Shutdown and Malfunction, Final Action [SSM SIP Call], 80 FR 33839, 33924 (June 12, 2015) (“[A]s part of normal permitting process, the EPA encourages permitting authorities to consider the discretionary nature of the emergency provisions when determining whether to continue to include permit terms modeled on those provisions in operating permits that the permitting authorities are issuing in the first instance or renewing”).

    B. Subsequent Legal and Regulatory History Supporting This Action

    The EPA has considered the most appropriate ways to account for excess emissions during different modes of source operation, such as startup and shutdown, and emissions during emergencies, upsets, and malfunctions for more than 40 years. The EPA's policies regarding the emergency affirmative defense provisions in its part 70 and 71 regulations have been shaped by a number of factors, including the structure of the CAA, federal court decisions, experience with similar provisions in other EPA programs, and recommendations from stakeholders. This section summarizes some of the more relevant and recent legal, regulatory, and policy considerations informing the EPA's current policy on affirmative defense provisions, including the D.C. Circuit's opinion in NRDC v. EPA and the EPA's recent experience with affirmative defenses for startup, shutdown, and malfunction (SSM) events in State Implementation Plans (SIPs).

    1. D.C. Circuit Opinion in NRDC v. EPA

    In the 2014 NRDC v. EPA9 case, the United States Court of Appeals for the D.C. Circuit vacated an affirmative defense provision applicable to malfunction events. In 2010, the EPA included an affirmative defense within its National Emission Standards for Hazardous Air Pollutants (NESHAP) for Portland cement facilities, promulgated under CAA section 112.10 This provision created an affirmative defense that sources could assert in civil enforcement proceedings when violations of emission limitations occurred because of qualifying unavoidable malfunctions. The D.C. Circuit held that this affirmative defense provision exceeded the EPA's statutory authority and that only the courts have the authority to decide whether to assess penalties for violations in civil suits. As the court explained:

    9 749 F.3d 1055 (D.C. Cir. 2014).

    10 National Emission Standards for Hazardous Air Pollutants From the Portland Cement Manufacturing Industry and Standards of Performance for Portland Cement Plants, 75 FR 54993 (September 9, 2010).

    By its terms, Section 304(a) clearly vests authority over private suits in the courts, not EPA. As the language of the statute makes clear, the courts determine, on a case-by-case basis, whether civil penalties are “appropriate.” By contrast, EPA's ability to determine whether penalties should be assessed for Clean Air Act violations extends only to administrative penalties, not to civil penalties imposed by a court. . . . [U]nder this statute, deciding whether penalties are “appropriate” in a given private civil suit is a job for the courts, not for EPA.” 11

    11NRDC v. EPA, 749 F.3d 1055, 1063 (D.C. Cir. 2014).

    The D.C. Circuit therefore concluded that the EPA lacked the authority to create an affirmative defense in private civil suits that would purport to alter the jurisdiction of the court to assess civil penalties for violations. Although this case was based on EPA regulations promulgated under CAA section 112, the court's holding was not based on section 112, but rather on sections 304(a) and 113(e)(1). Therefore, and as discussed further in Section IV of this document, the EPA interprets the decision to be relevant to all similar affirmative defense provisions, such as those found in part 70 and part 71, that may interfere with the authority of courts to assess penalties or to impose other remedies authorized in CAA section 113(b) in civil enforcement suits. This proposed rulemaking seeks to ensure that the EPA's part 70 and part 71 regulations are consistent with the enforcement structure of the CAA in accordance with the reasoning of the NRDC v. EPA decision.12

    12 In 2008, the D.C. Circuit issued a decision in Sierra Club v. Johnson, 551 F.3d 1019, vacating the EPA's regulations that exempted sources under certain circumstances from emissions standards during periods of SSM. The EPA maintains that the part 70 and part 71 emergency affirmative defense provisions are just that—affirmative defenses to enforcement actions—not exemptions from otherwise applicable emissions limitations. Such affirmative defense provisions are called into question by NRDC v. EPA. However, to the extent that the title V emergency affirmative defense could be considered in some respects to function like an exemption from otherwise applicable emissions limitations, such an exemption would be incompatible with the CAA and Sierra Club v. Johnson. This is an alternative basis for proposing to remove the part 70 and part 71 emergency affirmative defense provisions, as discussed further in Section IV.C of this document.

    2. SSM SIP Call

    The EPA has also reconsidered affirmative defense provisions similar to those involved in the NRDC v. EPA case in other recent regulatory actions. On June 15, 2015, the EPA issued a “SIP Call” (the SSM SIP Call) finding that certain SIP provisions in 36 states are substantially inadequate to meet CAA requirements.13 Many of the deficient SIP provisions at issue in the SSM SIP call are affirmative defense type provisions, and some of them are analogous to the emergency affirmative defense in part 70 and part 71. Although the agency's SSM policy for SIP provisions is not directly at issue in this proposal, certain aspects of the SSM SIP Call are especially relevant and are discussed in this subsection.

    13 SSM SIP Call, 80 FR 33839 (June 12, 2015).

    After the EPA initially proposed the SSM SIP Call,14 the D.C. Circuit issued its opinion in NRDC v. EPA. That decision, which concerned the legal basis for an affirmative defense provision in the EPA's own regulations, caused the EPA to reconsider the legal basis for any affirmative defense provisions contained in SIPs.15 The EPA concluded that the logic of the court in NRDC v. EPA extends beyond CAA section 112 to affirmative defense provisions contained in SIPs. Therefore, the EPA clarified and revised its interpretation of CAA requirements with respect to affirmative defense provisions for SSM events. The agency explained that “the enforcement structure of the CAA, embodied in section 113 and section 304, precludes any affirmative defense provisions that would operate to limit a court's jurisdiction or discretion to determine the appropriate remedy in an enforcement action. These provisions are not appropriate under the CAA, no matter what type of event they apply to, what criteria they contain or what forms of remedy they purport to limit or eliminate.” 16 The EPA explained that “[a]ffirmative defense provisions by their nature purport to limit or eliminate the authority of federal courts to determine liability or to impose remedies through factual considerations that differ from, or are contrary to, the explicit grants of authority in section 113(b) and section 113(e).” 17 The EPA's interpretation of the CAA's enforcement structure and the NRDC v. EPA decision, as set forth in the final SSM SIP Call, is relevant to the current rulemaking. Section IV of this document further discusses this interpretation in the context of the part 70 and part 71 emergency provisions.

    14 State Implementation Plans: Response to Petition for Rulemaking; Findings of Substantial Inadequacy; and SIP Calls To Amend Provisions Applying to Excess Emissions During Periods of Startup, Shutdown, and Malfunction, Proposed Rule, 78 FR 12459 (February 22, 2013).

    15See State Implementation Plans: Response to Petition for Rulemaking; Findings of Substantial Inadequacy; and SIP Calls To Amend Provisions Applying to Excess Emissions During Periods of Startup, Shutdown and Malfunction; Supplemental Proposal To Address Affirmative Defense Provisions in States Included in the Petition for Rulemaking and in Additional States, Supplemental notice of proposed rulemaking [SSM SIP Call Supplemental Proposal], 79 FR 55919, 55929 (September 17, 2014).

    16 SSM SIP Call, 80 FR 33851 (June 12, 2015).

    17Id. at 33852.

    Following this interpretation, the EPA directed states to remove specifically identified provisions containing affirmative defenses from their SIPs. Some of these SSM provisions were similar to the emergency provisions in the EPA's part 70 and part 71 regulations. In the final SSM SIP Call, the EPA indicated that provisions modeled after the §§ 70.6(g) and 71.6(g) emergency affirmative defense provisions—including provisions that were more narrowly defined—were no longer consistent with the EPA's interpretation of the CAA and could not be included in SIPs.18 For example, the EPA found that an Arkansas SIP provision establishing an affirmative defense for emergencies, which may have been modeled after the EPA's title V regulations, was substantially inadequate to meet CAA requirements.19 The EPA also discussed the potential conflict between the SSM policy applicable to SIP provisions and the part 70 and part 71 emergency provisions, but noted that it was not taking action to revise the title V regulations in the SSM SIP Call rulemaking.20 In the final SSM SIP Call, however, the EPA indicated that it was considering whether such changes may be necessary and how best to make such changes.

    18Id. at 33924.

    19Id. at 33967; see also SSM SIP Call Supplemental Proposal, 79 FR 55942 and 55943.

    20 SSM SIP Call, 80 FR 33924 (June 12, 2015).

    3. Related Actions in Other CAA Program Areas

    Since 2014, the EPA has removed or omitted affirmative defense provisions in numerous regulations throughout other CAA program areas following the NRDC v. EPA case. Specifically, in newly issued and revised New Source Performance Standards (NSPS), emission guidelines for existing sources, and NESHAP regulations, the EPA has either omitted new affirmative defense provisions or removed existing affirmative defense provisions.21 This proposed rulemaking for the part 70 and part 71 regulations is thus consistent with these related efforts in other CAA program areas and ensures that title V operating permits do not contain additional affirmative defenses that could interfere with the EPA's efforts to remove these impermissible provisions from specific underlying applicable requirements.

    21See, e.g., National Emission Standards for Hazardous Air Pollutants for the Portland Cement Manufacturing Industry and Standards of Performance for Portland Cement Plants; Final Rule, 80 FR 44771 (July 27, 2015); National Emission Standards for Hazardous Air Pollutants for Major Sources: Industrial, Commercial, and Institutional Boilers and Process Heaters; Final Rule, 80 FR 72789 (November 20, 2015); Standards of Performance for New Stationary Sources and Emission Guidelines for Existing Sources: Commercial and Industrial Solid Waste Incineration Units; Proposed Rule, 80 FR 3018, 3025 (January 21, 2015).

    IV. Proposed Changes to Part 70 and Part 71 Regulations A. Purpose of This Proposed Rulemaking

    This proposed rulemaking is responsive to a number of concerns and related actions, including those discussed in Section III of this document. The EPA considers this proposed rulemaking important to ensure that the EPA's title V regulations are consistent with the enforcement structure envisioned by Congress in the 1990 CAA amendments. This action is intended to respond to the reasoning of the D.C. Circuit's recent opinion in NRDC v. EPA, which the EPA interprets to extend to the affirmative defense provisions in the part 70 and part 71 regulations. This proposed rule also follows from similar regulatory actions in other CAA program areas, including the recent SSM SIP Call and various NSPS and NESHAP regulations. The EPA considers the proposed removal of the emergency affirmative defense provisions from the title V regulations necessary to maintain a consistent interpretation of the CAA throughout different CAA programs, including section 110 SIPs, section 111 NSPS and existing source guidelines, and section 112 NESHAPs.

    Finally, this proposed action follows from the EPA's stated intentions to revisit the emergency affirmative defense provisions promulgated in 1992 and seeks to provide clarity in response to stakeholder concerns.22 The EPA initially sought to clarify the scope of the emergency provisions over the course of multiple actions in 1995 and 1996. However, the EPA ultimately indicated that it would reevaluate the part 70 and part 71 emergency affirmative defense provisions—including whether these provisions may need to be eliminated—in a subsequent rulemaking.23 The EPA again discussed the title V emergency provisions in the SSM SIP Call, where the agency acknowledged the potential conflict between the SSM policy applicable to SIP provisions and the part 70 and part 71 emergency provisions, but indicated that it would potentially make changes to the title V affirmative defense provisions in a subsequent rulemaking.24 As contemplated in the prior title V rulemakings and in the more recent SSM SIP Call, the EPA is now considering the appropriate changes to parts 70 and 71 and proposing to remove the title V emergency affirmative defenses provisions.

    22 In addition to comments received on prior regulatory actions, the EPA has received input from stakeholders as recent as 2006. The Clean Air Act Advisory Committee (CAAAC), chartered under the Federal Advisory Committee Act, was established to advise the EPA on issues related to the 1990 CAA Amendments. In 2006, a Task Force formed by the CAAAC issued its Final Report: Title V Implementation Experience. See Title V Task Force, Final Report to the Clean Air Act Advisory Committee: Title V Implementation Experience (April 2006), available at http://www.epa.gov/sites/production/files/2014-10/documents/title5_taskforce_finalreport20060405.pdf. Although the Task Force did not agree on how broadly the title V emergency affirmative defense should be applied, all eighteen members of the Task Force unanimously recommended the following: “Title V permits should be clear as to which limits are subject to the part 70 emergency defense (e.g., under the current rule, technology based limits).” Id. at 144. By way of response, the proposed action to remove these provisions would essentially moot these concerns about clarity on the applicability of these provisions.

    23See Federal Operating Permits Program, Proposed Rule, 60 FR 20804, 20816 (April 27, 1995) (“The EPA is reevaluating the provisions in parts 70 and 71 relating to the emergency defense in light of concerns identified in legal challenges to the part 70 rule. The EPA may propose revisions to the part 70 and part 71 sections providing for the emergency defense before EPA would include such defense in any part 71 permits.”); Title V Supplemental Proposal, 60 FR 45560 (“The EPA is reluctant to retain a generally applicable emergency defense without completing further review of the appropriateness of such a defense for the different Federal technology based standards in light of the concerns with such a defense raised in the CWA cases.”); Federal Operating Permits Program, Final Rule, 61 FR 34219 (“As a result of concerns identified in legal challenges to part 70, the Agency, in the August 1995 supplemental proposal, solicited comment on the need for, scope and terms of an emergency affirmative defense provision. The Agency is reviewing those comments, but has not yet made a decision on whether or not to modify or remove this additional affirmative defense provision from part 70.” (emphasis added)).

    24See SSM SIP Call, 80 FR 33924 (“Those regulations [40 CFR 70.6(g) and 71.6(g)], which are applicable to title V operating permits, may only be changed through appropriate rulemaking to revise parts 70 and 71. Further, any existing permits that contain such emergency provisions may only be changed through established permitting procedures. The EPA is considering whether to make changes to 40 CFR part 70 and 40 CFR part 71, and if so, how best to make those changes. In any such action, EPA would also intend to address the timing of any changes to existing title V operating permits. Until that time, as part of normal permitting process, the EPA encourages permitting authorities to consider the discretionary nature of the emergency provisions when determining whether to continue to include permit terms modeled on those provisions in operating permits that the permitting authorities are issuing in the first instance or renewing.”).

    B. Proposed Action: Removal of 40 CFR 70.6(g) and 71.6(g)

    The EPA is proposing to remove the emergency provisions located at 40 CFR 70.6(g) and 71.6(g). The agency has not identified any other viable option for reconciling these affirmative defense provisions with the enforcement structure of the CAA, in accordance with the reasoning of the NRDC v. EPA decision. The implications of this proposed removal on the federal operating permit program, state operating permit programs, and on individual sources subject to title V operating permits are discussed in Section V of this document.

    C. Legal Justification for Proposed Action

    This action is proposed pursuant to CAA sections 502(b) and 502(d)(3), 42 U.S.C. 7661a(b) & (d)(3), which direct the Administrator of the EPA to promulgate regulations establishing state operating permit programs and give the Administrator authority to establish a federal operating permit program.

    The EPA proposes to remove the affirmative defense provisions from the part 70 and 71 regulations in order to ensure that the federal and state title V operating permit programs operate within the bounds established by Congress in the 1990 CAA Amendments. Regarding these boundaries, the D.C. Circuit's opinion in NRDC v. EPA is instructive as to the enforcement structure envisioned by Congress, as well as the role of affirmative defense provisions within the EPA's regulations implementing the CAA. As discussed in Section III.B.1 of this document, the court in NRDC v. EPA determined that an affirmative defense provision promulgated by the EPA for the Portland cement industry under CAA section 112 exceeded the agency's statutory authority. In doing so, the D.C. Circuit based its holding on CAA sections 304(a) and 113(e)(1).

    CAA section 304(a) grants “any person” the right to “commence a civil action . . . against any person . . . who is alleged to have violated (if there is evidence that the alleged violation has been repeated) or to be in violation of . . . an emission standard or limitation” under the CAA. 42 U.S.C. 7604(a). Section 304(a) also provides that “[t]he [federal] district courts shall have jurisdiction, without regard to the amount in controversy or the citizenship of the parties, to enforce such an emission standard or limitation . . . and to apply any appropriate civil penalties.” Id. CAA section 113(e)(1) establishes a number of factors that courts must consider when determining the amount of any penalties assessed in civil actions under section 304(a). See 42 U.S.C. 7413(e)(1).

    The D.C. Circuit indicated that these statutory provisions precluded the EPA from promulgating affirmative defense provisions that a source could use in civil enforcement suits. The court did not remand the regulation to the EPA for better explanation of the legal basis for an affirmative defense; the court instead vacated the affirmative defense and indicated that there could be no valid legal basis for such a provision because it contradicted fundamental requirements of the CAA concerning the authority of courts in judicial enforcement of CAA requirements. As the court explained:

    By its terms, Section 304(a) clearly vests authority over private suits in the courts, not EPA. As the language of the statute makes clear, the courts determine, on a case-by-case basis, whether civil penalties are “appropriate.” By contrast, EPA's ability to determine whether penalties should be assessed for Clean Air Act violations extends only to administrative penalties, not to civil penalties imposed by a court. . . . [U]nder this statute, deciding whether penalties are “appropriate” in a given private civil suit is a job for the courts, not for EPA.” 25

    25NRDC v. EPA, 749 F.3d 1055, 1063 (D.C. Cir. 2014).

    The court also noted that “EPA cannot rely on its gap-filling authority to supplement the Clean Air Act's provisions when Congress has not left the agency a gap to fill.” 26

    26Id. at 1064.

    The D.C. Circuit's holding in NRDC v. EPA is especially pertinent here.27 Like the Portland cement NESHAP at issue in the NRDC v. EPA case, the provisions at issue in this proposal are also regulations promulgated by the EPA to implement programs under the CAA. The affirmative defense for malfunctions in the Portland cement NESHAP and the affirmative defense for emergencies in the EPA's part 70 and part 71 regulations are functionally similar provisions that operate in essentially identical ways to establish affirmative defenses in civil enforcement actions. Moreover, the EPA believes that the reasoning of the court's decision in NRDC v. EPA applies more broadly than to the specific facts of the case for several reasons. The EPA notes that the court's decision did not turn upon the specific provisions of CAA section 112. Although the court only evaluated the legal validity of an affirmative defense provision created by the EPA in conjunction with specific standards applicable to manufacturers of Portland cement, the court based its decision upon the provisions of sections 113 and 304 that pertain to enforcement of CAA requirements more broadly, including to emission limits in title V permits. Sections 113 and 304 pertain to administrative and judicial enforcement generally and are in no way limited to enforcement of emission limitations promulgated by the EPA under section 112. Thus, the EPA does not think that the mere fact that the court only addressed the legality of an affirmative defense provision in this particular context means that the court's interpretation of sections 113 and 304 does not also apply more broadly. To the contrary, the EPA sees no reason why the logic of the court concerning sections 113 and 304 would not apply to the title V emergency affirmative defense provisions, as well.

    27 The EPA's interpretation of the NRDC v. EPA case as it affects the affirmative defense provisions in parts 70 and 71 is similar to the interpretation of the case as articulated in the SSM SIP Call. More information on the EPA's interpretation of the NRDC v. EPA ruling can be found in the Final SSM SIP Call and the August 2014 Supplemental Proposal. See SSM SIP Call, 80 FR 33851; SSM SIP Call Supplemental Proposal, 79 FR 55929.

    In light of the court's decision, the EPA now interprets the enforcement structure of the CAA, embodied in section 113 and section 304, to preclude affirmative defense provisions that would operate to limit a court's authority or discretion to determine the appropriate remedy in an enforcement action. CAA section 304(a) grants the federal district courts the jurisdiction to determine liability and to impose penalties in enforcement suits brought by citizens. Similarly, section 113(b) provides courts with explicit jurisdiction to determine liability and to impose remedies of various kinds, including injunctive relief, compliance orders, and monetary penalties, in judicial enforcement proceedings. These grants of jurisdiction come directly from Congress, and the EPA is not authorized to alter or eliminate this authority under the CAA or any other law. With respect to monetary penalties, CAA section 113(e) explicitly includes the factors that courts and the EPA are required to consider in the event of judicial or administrative enforcement for violations of CAA requirements, including title V permit provisions. Because Congress has already given federal courts the authority to determine what monetary penalties are appropriate in the event of judicial enforcement for a violation of a title V permit provision, neither the EPA nor states can alter or eliminate that authority by superimposing restrictions on the authority and discretion granted by Congress to the courts. Affirmative defense provisions by their nature purport to limit or eliminate the authority of federal courts to determine liability or to impose remedies through factual considerations that differ from, or are contrary to, the explicit grants of authority in section 113(b) and section 113(e). Therefore, these provisions are not appropriate under the CAA, no matter what type of event they apply to, what criteria they contain, or what forms of remedy they purport to limit or eliminate. This is true for regulations promulgated under CAA sections 111 and 112, SIP provisions approved by the EPA, and regulations promulgated under title V of the CAA. Thus, just as the EPA revisited affirmative defenses in SIP provisions in light of the NRDC v. EPA opinion, the EPA is reevaluating its interpretation of the CAA relative to the emergency affirmative defense provisions contained in its part 70 and part 71 regulations, and is proposing to remove those provisions because they are not consistent with the CAA's enforcement structure.

    Since the 2014 NRDC v. EPA decision, and in order to ensure consistency with the CAA's enforcement structure, the EPA has been omitting new affirmative defense provisions and removing existing affirmative defense provisions throughout many CAA program areas that establish emission limitations contained in title V permits. However, the title V emergency affirmative defense provisions apply regardless of whether there is an affirmative defense also found in the underlying applicable requirements. See 40 CFR 70.6(g)(5) and 71.6(g)(5). As a result, sources could seek to assert this affirmative defense in title V enforcement cases for noncompliance with emission limitations derived from applicable requirements that do not otherwise contain such an affirmative defense for emergencies. The continued existence of the title V emergency affirmative defense provisions thus contradicts and compromises the EPA's on-going efforts to ensure that underlying regulations are applied consistently with the CAA.

    The EPA maintains that the part 70 and part 71 emergency affirmative defense provisions are affirmative defenses to enforcement actions and are not “exemptions” from otherwise applicable emissions limitations. However, as an alternative but additional justification, to the extent that the emergency affirmative defense provisions in part 70 and part 71 could be interpreted to establish an exemption or exclusion from emission limits (rather than merely an affirmative defense to penalties in the event of a violation), these provisions would still run contrary to the CAA's requirements and require removal. As previously noted,28 under Sierra Club v. Johnson, 29 the CAA requires that emission limitations must apply continuously and cannot contain exemptions, conditional or otherwise. Therefore, even if characterized as an exemption or exclusion from otherwise applicable limits, the emergency affirmative defense provisions would, nonetheless, run afoul of the CAA and Sierra Club v. Johnson, and should, on that alternative basis, be removed.

    28See footnote 12.

    29 551 F.3d 1019 (D.C. Cir. 2008).

    V. Implementation A. Implementing These Changes in Part 70 State Operating Permit Programs

    This section discusses the actions that the EPA anticipates state, local, and tribal permitting authorities 30 would need to take (if this proposed rule is finalized in substantially the same form) in order to ensure that their operating permit programs are consistent with the proposed revisions to the EPA's part 70 regulations and the CAA's enforcement structure. The EPA welcomes comments on how best to address the implementation consequences of the proposed removal of 40 CFR 70.6(g).

    30 As noted in footnote 1, the term “state” as used throughout this preamble refers to all state, local and tribal permitting authorities that administer approved part 70 programs.

    1. Programs That Do Not Contain Emergency Affirmative Defense Provisions

    As discussed in Section III.A of this document, the section 70.6(g) emergency provision has never been a required element of part 70 operating permit programs. For states that have not adopted the section 70.6(g) emergency provision, or any similar affirmative defense provision, into their part 70 operating permit programs, no further action would be required to comply with this rule as proposed. However, we expect that as a result of this rulemaking, it may be necessary for states that have adopted an affirmative defense in their part 70 programs to take the actions described in the following subsections.

    2. Programs That Contain Emergency Affirmative Defense Provisions

    The EPA's existing part 70 regulations provide for state program revisions if part 70 is revised and the EPA determines that such conforming changes are necessary. See 40 CFR 70.4(a) and 70.4(i). Therefore, as a result of this proposed regulatory action to remove 40 CFR 70.6(g) and 71.6(g), state operating permit programs that contain an emergency affirmative defense may have to take appropriate actions to remain consistent with the CAA and the EPA's part 70 regulations. As discussed in more detail in the following subsections, the EPA is requesting comment on whether revisions to certain approved state programs may be necessary if the EPA removes 40 CFR 70.6(g) and 71.6(g).

    a. Scope of Program Revisions That May Be Necessary if the Rule Is Finalized as Proposed

    Affirmative defense provisions included within a state's part 70 (title V) program regulations—including provisions that are narrower in scope or more stringent than 40 CFR 70.6(g)—will generally implicate the same concerns that prompted the EPA to propose removing 70.6(g) and 71.6(g) from the agency's regulations. The EPA expects that state programs containing provisions that mirror the exact language of 70.6(g) would need to be revised if this proposed rule is finalized, as would state programs that have provisions that do not exactly mirror the language of 40 CFR 70.6(g), but nonetheless provide for title V affirmative defenses.31 In any case, the EPA invites comment on whether it may be necessary for states to revise programs containing any provisions that (1) purport to establish an affirmative defense to enforcement actions 32 and (2) are included within the state's part 70 (title V) program regulations. Anytime the phrases “affirmative defense” or “emergency affirmative defense” are used within this section, these phrases are intended to refer to all such provisions meeting these criteria. These criteria are intended to encompass provisions that initially would have been approved by the EPA as consistent with 40 CFR 70.6(g) and 70.4(b)(16). This action would not directly affect any affirmative defense provisions arising under other CAA applicable requirements, or state-only provisions outside of each state's approved part 70 operating permit programs.

    31 For example, affirmative defense provisions that refer to “upsets” or “malfunctions” rather than “emergencies” would still implicate the same concerns.

    32 Additionally, any state program provisions based off of 70.6(g) that purport to establish an “exemption” or “exclusion” to emission limitations (rather than, or in addition to, an affirmative defense for noncompliance) during emergencies, upsets, or malfunctions would also likely need to be removed. To the extent that an emergency defense is characterized as an exemption, this would run afoul of the CAA requirement that emission limitations must apply continuously and cannot contain exemptions. See Sierra Club v. Johnson, 551 F.3d 1019 (D.C. Cir. 2008); SSM SIP Call, 80 FR 33852.

    The EPA has begun to compile a tentative list of affirmative defense provisions within state programs that may eventually need to be removed. The EPA is including this list in the docket for this proposed rulemaking (EPA-HQ-OAR-2016-0186) for informational purposes only; this list is not an official determination as to the adequacy or inadequacy of any program provisions. The EPA seeks comment on whether there are additional title V affirmative defense provisions in state regulations or statutes that we have not yet identified, and whether any such provisions would or would not remain appropriate as part of a state's approved title V program if this proposed rule is finalized.

    b. Form of Program Revisions

    Because the EPA believes that a large number of part 70 programs contain provisions resembling those that the agency proposes to eliminate, the EPA anticipates that it will be necessary for states to initiate conforming revisions to remove any affirmative defense provisions from their approved title V operating permit programs if the EPA removes 40 CFR 70.6(g). The EPA seeks comment on this approach and on other possible approaches to ensure that state programs are consistent with the CAA and the EPA's part 70 regulations. However, the EPA does not anticipate that it would be appropriate for states to retain affirmative defense provisions within their approved part 70 programs. For example, if a state decided, in lieu of a program revision, to exercise its discretion to omit or remove affirmative defense provisions from all future title V operating permits, the state's approved part 70 program would still contain regulations inconsistent with the EPA's part 70 regulations and the CAA. Further, if an emergency provision remained in a state's approved program, a source could potentially attempt to invoke the provision as an affirmative defense during an enforcement proceeding, notwithstanding its absence from the source's individual title V permit. This result could undermine the enforcement of certain permit limitations and would be inconsistent with the enforcement structure of the CAA.

    Although the EPA expects that most states would elect to remove the emergency affirmative defense provisions from their part 70 program regulations, states could nonetheless choose to retain such affirmative defense provisions within their permitting regulations as state-only requirements in certain circumstances. In that case, states would have to ensure and make clear to the EPA that any remaining affirmative defense provisions are only available for alleged noncompliance with permit requirements arising solely from state law. Ideally, this would involve an amendment to state regulations to explicitly clarify the limited applicability of any remaining affirmative defense provisions; such a clarifying amendment could also effectively serve as an appropriate revision to the state's part 70 program. The EPA solicits comment on whether and to what extent it would be appropriate for states to retain state-only affirmative defense provisions if this proposed rule is finalized.

    Finally, states may also choose to remove any other provisions that reference 40 CFR 70.6(g) or similar state affirmative defense provisions in order to ensure clarity. These could include, but are not limited to, state regulations that incorporate by reference 40 CFR 70.6(g), as well as any associated definitions, recordkeeping, or reporting requirements relating to the affirmative defense provisions affected by this rulemaking. States may also wish to retain a portion of the emergency provisions, such as the definition of “emergency” or certain reporting requirements, for purposes of supporting other regulations that do not involve an affirmative defense. This could be appropriate as long as any remaining provisions could not be interpreted to provide an affirmative defense to federally applicable requirements.

    c. Procedure, Timing and Content of Program Revisions

    If this proposed rule is finalized, the EPA expects that it would be necessary for any states with approved part 70 operating permit programs that contain emergency affirmative defense provisions to remove any such provisions and submit program revisions to the EPA within 12 months after the final rule's effective date. For many programs, the EPA does not anticipate that additional state legislative authority will be required to enact these revisions. Therefore, the EPA believes that 12 months will be ample time for many states to make such a straightforward and narrow program revision. However, the EPA is considering whether it may be appropriate to provide individual states up to 24 months to submit program revisions if a state demonstrates that additional legislative authority is necessary to enact the program revisions.

    If this proposed rule is finalized, the EPA expects that state program revisions submitted to the agency should include a redline version of the specific changes made to the state's part 70 regulations to remove any emergency affirmative defense provisions. States may, but need not, include as part of their program revision submittals any other unrelated revisions to state program regulations.33 Each state should also include a brief statement of the legal authority that authorized this removal, which could take various forms depending on the specific circumstances of each state. Finally, to address how the program revisions would be implemented with respect to individual permits, each state should also include a schedule for the planned removal of these provisions from individual title V operating permits, as well as a description of the mechanism(s) that the state plans to use to remove these existing provisions. Further discussion of how these program revisions should be implemented in individual permits is presented in Section V.A.3 of this document.

    33 The EPA intends that any narrow program revisions that may be necessary if this rule is finalized could be expeditiously processed, whether submitted alone or with other program revisions.

    The EPA is specifically requesting comment on these program revision time frames and procedures from permitting authorities whose approved part 70 programs contain affirmative defense provisions. The EPA solicits additional comments from states with title V program provisions that may also be contained within SIPs as to any additional revisions that may be necessary if this rule is finalized.

    3. Effect of This Rule on Current and Future State-Issued Operating Permits

    The eventual finalization of this rule would not have an automatic impact on sources currently operating under a title V permit, and any minimal resource burden to revise permits would likely be spread over many years. After a state makes any necessary revisions to its title V program, the EPA expects that revisions to operating permits to remove emergency affirmative defense provisions would generally occur in the ordinary course of business as the state issues new permits or reviews and revises existing permits. The options presented in the following subsections would afford states with the maximum flexibility to implement these changes while ensuring predictability for sources operating under title V permits.

    a. Form of Permit Changes

    In order to implement program revisions that may be necessary if this rule is finalized as proposed, it may be necessary for states to remove title V emergency affirmative defense provisions that are currently included in any state-issued permits.34 Alternatively, states may choose to allow sources to retain affirmative defense provisions in their permits as state-only provisions. Any such remaining affirmative defense provisions must be clearly labeled within each permit as not applicable for federal law purposes to ensure that they are not available in enforcement actions for noncompliance with any federally-enforceable emission limitations, as required by 40 CFR 70.6(b)(2).

    34 It is possible that individual operating permits may contain other provisions establishing affirmative defenses that are derived from other applicable requirements. As previously noted, this proposed rulemaking will not have any effect on affirmative defense provisions promulgated under any CAA requirements other than 40 CFR 70.6(g) and 71.6(g). However, the source of such affirmative defense provisions should be clearly stated in each individual operating permit, to avoid confusion about the scope of such provisions.

    b. Mechanisms and Timing of Permit Changes

    The EPA anticipates that states would have the flexibility to remove emergency provisions from title V permits through a number of different existing mechanisms, either through changes to individual permits or perhaps to multiple permits through more streamlined processes. As previously noted, if the proposed action is finalized, any necessary program revision submittals should reflect the planned schedule and mechanism for these permit changes. The EPA expects that states will follow the guidelines discussed in this preamble, but will consider other plans for revising title V permits that would not cause undue delay.

    First, states could require that permit applications address the removal of emergency provisions during the next periodic permit renewal, permit modification, or permit reopening, including those that occur as the result of other rulemakings. States using these mechanisms should ensure that these changes occur at the first possible occasion; in other words, the first situation in which the permitting authority must act on an individual permit after state program revisions are approved by the EPA. Moreover, because states have never been required by federal law to include these provisions in state-issued title V permits, the EPA also encourages states to exercise their discretion to cease including emergency affirmative defense provisions as early as practicable. In many cases, there will be no reason for states to wait for the EPA to take final action on this proposal to begin implementing this suggestion.35

    35 Of course, if currently-approved state program regulations require that this provision be included within individual title V operating permits, a state may not be able to exercise this discretion until program revisions are completed.

    Additionally, sources may apply for a permit modification from their permitting authority at any time. The EPA anticipates that the removal of an emergency affirmative defense would not trigger the significant modification procedures under 40 CFR 70.7(e)(4), and—depending on the regulations in each state's approved title V program—could be implemented using minor modification procedures. Finally, depending on the unique structure of each state's operating permit program, some states may also be able to remove these provisions from multiple existing permits in a single action, via mechanisms such as general permits or permits-by-rule. The EPA is requesting comment on how states could use existing permitting options to remove emergency affirmative defense provisions from title V permits in a more streamlined and expeditious manner.

    Overall, the EPA believes that addressing the omission or removal of emergency affirmative defense provisions from permits according to the existing state program mechanisms described in this subsection affords states sufficient flexibility to implement these changes and provides certainty to facilities operating under title V permits. Under the approaches currently being considered, the EPA anticipates that the removal of affirmative defense provisions from permits should generally occur in the ordinary course of business and should require essentially no additional burden on states or sources. The timing for these changes may coincide with similar changes to operating permits based on revised SIP provisions following the SSM SIP Call or changes to other applicable requirements, and it may be convenient and efficient for states to make all necessary changes to title V permits at the same time.

    B. Implementing These Changes in the Part 71 Federal Operating Permit Program

    Although the title V operating permit program is typically implemented by state and local permitting authorities through EPA-approved part 70 programs, in certain circumstances the EPA has assumed direct permitting authority over sources through its part 71 program. The EPA administers the part 71 federal program in most areas of Indian country (however, one tribe—the Southern Ute Tribe—has an approved part 70 program, and another—the Navajo Nation—has been delegated part 71 implementation authority),36 on the Outer Continental Shelf (where there is no state permitting authority), as well as for specific sources where the EPA has determined that a state has not adequately implemented its part 70 program or satisfied an EPA objection to a permit.

    36 The EPA has delegated a portion of its part 71 permitting authority to the Navajo Nation EPA (NNEPA) through a delegation agreement, such that NNEPA assumes the responsibility for specific aspects of program administration under the part 71 regulations, including the authority to issue part 71 operating permits to sources.

    In some cases where the EPA administers its part 71 program, the EPA has included in its federally-issued operating permits the emergency affirmative defense provision found in 40 CFR 71.6(g). If 40 CFR 71.6(g) is removed, the federal (including delegated) program rules would no longer include regulatory authority for incorporating this emergency affirmative defense in permits. Therefore, in order to ensure that part 71 programs are implemented consistent with the proposed revisions to the part 71 regulations, the EPA or delegated permitting authority should remove emergency affirmative defense provisions that are currently included in title V permits at the next permit action following the effective date of the final rule. Because the EPA has always considered the emergency provisions to be discretionary permit terms, the EPA has omitted emergency affirmative defense provisions from part 71 permits that it has issued since the D.C. Circuit's 2014 NRDC v. EPA decision. The EPA plans to continue to exercise its discretion to not include emergency affirmative defense provisions in future EPA-issued operating permits.

    C. Effect on Sources Potentially Subject to Enforcement Proceedings

    The legal rights and obligations of individual sources potentially subject to enforcement proceedings would not be adversely affected by the removal of emergency affirmative defense provisions from their title V permits.37 The absence of an affirmative defense provision in a source's title V permit does not mean that all exceedances of emission limitations in a title V permit will automatically be subject to enforcement or automatically be subject to imposition of particular remedies. Pursuant to the CAA, all parties with authority to bring an enforcement action to enforce title V permit provisions (i.e., the state, the EPA, or any parties who qualify under the citizen suit provision of CAA section 304) have enforcement discretion that they may exercise as they deem appropriate in any given circumstances. For example, if the excess emissions caused by an emergency occurred despite proper operation of the facility, and despite the permittee taking all reasonable steps to minimize excess emissions, then these parties may decide that no enforcement action is warranted. In the event that any party decides that an enforcement action is warranted, then it has enforcement discretion with respect to what remedies to seek from the court for the violation (e.g., injunctive relief, compliance order, monetary penalties, or all of the above), as well as the type of injunctive relief and/or amount of monetary penalties sought.38

    37 The removal of these provisions from individual operating permits has similar implications to sources as the removal of the SSM provisions subject to the SSM SIP Call. See SSM SIP Call, 80 FR 33852.

    38 The EPA notes that only the state and the EPA have authority to seek criminal penalties for knowing and intentional violation of CAA requirements. The EPA has this explicit authority under section 113(c).

    Further, courts have the discretion under section 113 to decline to impose penalties or injunctive relief in appropriate cases. In the event of an enforcement action for an exceedance of an emission limit in a title V permit, a source can elect to assert any common law or statutory defenses that it determines are supported, based upon the facts and circumstances surrounding the alleged violation. Under sections 304(a) and 113(b), courts have authority to impose injunctive relief, issue compliance orders, assess monetary penalties or fees and award any other appropriate relief. Under section 113(e), courts are required to consider the enumerated factors when assessing monetary penalties, including the source's compliance history, good faith efforts to comply the duration of the violation, and “such other factors as justice may require.” If the exceedance of the emission limitation occurs due to an emergency, the source retains the ability to defend itself in an enforcement action and to oppose the imposition of particular remedies or to seek the reduction or elimination of monetary penalties, based on the specific facts and circumstances of the emergency event. Thus, elimination of an emergency affirmative defense provision that purported to take away the statutory jurisdiction of the court to exercise its authority to impose remedies does not disarm sources in potential enforcement actions. Sources would retain all of the equitable arguments they previously could have made; they must simply make such arguments to the reviewing court as envisioned by Congress in section 113(b) and section 113(e). Congress vested the courts with the authority to judge how best to weigh the evidence in an enforcement action and determine appropriate remedies.

    The eventual removal of such impermissible emergency affirmative defense provisions from state operating permit programs and individual title V permits will likely be necessary to preserve the enforcement structure of the CAA, to preserve the authority of courts to adjudicate questions of liability and remedies in judicial enforcement actions, and to preserve the potential for enforcement by states, the EPA, and other parties under the citizen suit provision as an effective deterrent to violations. In turn, this deterrent encourages sources to be properly designed, maintained, and operated and, in the event of violation of permitted emission limitations, to take appropriate action to mitigate the impacts of the violation. In this way, as intended by the existing enforcement structure of the CAA, sources can mitigate the potential for enforcement actions against them and the remedies that courts may impose upon them in such enforcement actions, based upon the facts and circumstances of the event.

    VI. Environmental Justice Considerations

    The EPA believes the human health or environmental risk addressed by this proposed action would not have potential disproportionately high and adverse human health or environmental effects on minority, low-income or indigenous populations because it would not adversely affect the level of protection provided to human health or the environment. This action simply proposes to remove emergency affirmative defense provisions from the EPA's operating permit program regulations. If the proposed rule is finalized, it may also be necessary for state, local and tribal permitting authorities to remove similar affirmative defense provisions from program regulations and from individual title V operating permits. None of these changes would alter the obligations of sources to comply with the emission limits and other standards contained within title V operating permits. However, this proposed rulemaking could encourage sources to comply with the terms of their operating permits at all times to the maximum extent practicable. This could potentially result in improved air quality for communities living near sources of air pollution as well as the broader population. Thus, this proposed rulemaking will not adversely affect the level of protection to human health or the environment for any populations.

    VII. 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 not a significant regulatory action and was therefore not submitted to the Office of Management and Budget (OMB) for review.

    B. Paperwork Reduction Act (PRA)

    This action does not impose any new information collection burden under the PRA. OMB has previously approved the information collection activities contained in the existing regulations and has assigned OMB control numbers 2060-0243 (for part 70 state operating permit programs) and 2060-0336 (for part 71 federal operating permit program). In this action, the EPA is proposing to remove certain provisions from the EPA's regulations, which if finalized could result in the removal of similar provisions from state, local, and tribal operating permit programs and individual permits. Consequently, states could eventually be required to submit program revisions to the EPA outlining any necessary changes to their regulations and their plans to remove provisions from individual permits. However, this proposed action will not involve any requests for information, recordkeeping or reporting requirements, or other requirements that would constitute an information collection under the PRA.

    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. This proposed action will not impose any requirements on small entities. Entities potentially affected directly by this proposal include state, local, and tribal governments, and none of these governments would qualify as a small entity. Other types of small entities, including stationary sources of air pollution, are not directly subject to the requirements of this action.

    D. Unfunded Mandates Reform Act (URMA)

    This action does not contain an unfunded mandate of $100 million or more as described in UMRA, 2 U.S.C. 1531-1538, and does not significantly or uniquely affect small governments. The action imposes no enforceable duty on any state, local or tribal governments or the private sector.

    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.

    F. Executive Order 13175: Consultation and Coordination With Indian Tribal Governments

    This action has tribal implications. However, it will neither impose substantial direct compliance costs on federally recognized tribal governments, nor preempt tribal law. One tribal government (the Southern Ute Indian Tribe) currently administers an approved part 70 operating permit program, and one tribal government (the Navajo Nation) currently administers a part 71 operating permit program pursuant to a delegation agreement with the EPA. These tribal governments may be required to take actions if this proposed rule is finalized, including program revisions (for part 70 programs) and eventual permit revisions, but these actions will not require substantial compliance costs. The EPA solicits comment from affected tribal governments on the implications of this proposed rulemaking.

    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 concern 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 subject to Executive Order 13211 because it is not a significant regulatory action under Executive Order 12866.

    I. National Technology Transfer and Advancement Act

    This rulemaking 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 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 this evaluation are contained in Section VI of this document titled, “Environmental Justice Considerations.”

    VIII. Statutory Authority

    The statutory authority for this proposed action is provided in CAA sections 502(b) and 502(d)(3), 42 U.S.C. 7661a(b) & (d)(3), which direct the Administrator of the EPA to promulgate regulations establishing state operating permit programs and give the Administrator the authority to establish a federal operating permit program. Additionally, the Administrator determines that this action is subject to the provisions of CAA section 307(d), which establish procedural requirements specific to rulemaking under the CAA. CAA section 307(d)(1)(V) provides that the provisions of CAA section 307(d) apply to “such other actions as the Administrator may determine.” 42 U.S.C. 7607(d)(1)(V).

    List of Subjects 40 CFR Part 70

    Environmental protection, Administrative practice and procedure, Air pollution control, Intergovernmental relations, Reporting and recordkeeping requirements.

    40 CFR Part 71

    Environmental protection, Administrative practice and procedure, Air pollution control, Reporting and recordkeeping requirements.

    Dated: June 3, 2016. Gina McCarthy, Administrator.

    For the reasons stated in the preamble, title 40, chapter I of the Code of Federal Regulations is proposed to be amended as follows:

    PART 70—STATE OPERATING PERMIT PROGRAMS 1. The authority citation for part 70 continues to read as follows: Authority:

    42 U.S.C. 7401, et seq.

    § 70.6 [Amended]
    2. In § 70.6, remove paragraph (g). PART 71—FEDERAL OPERATING PERMIT PROGRAMS 3. The authority citation for part 71 continues to read as follows: Authority:

    42 U.S.C. 7401, et seq.

    § 71.6 [Amended]
    4. In § 71.6, remove paragraph (g).
    [FR Doc. 2016-14104 Filed 6-13-16; 8:45 am] BILLING CODE 6560-50-P
    81 114 Tuesday, June 14, 2016 Notices DEPARTMENT OF AGRICULTURE Agricultural Marketing Service [Doc No. AMS-SC-16-0043; SC16-033-1] Notice of Request for Renewal of a Recordkeeping Burden AGENCY:

    Agricultural Marketing Service, USDA.

    ACTION:

    Notice and request for comments.

    SUMMARY:

    In accordance with the Paperwork Reduction Act of 1995 (44 U.S.C. Chapter 35), this notice announces the Agricultural Marketing Service's (AMS) intention to request for renewal a recordkeeping burden for the information collection for the Export Fruit Acts covering exports of apples and grapes.

    DATES:

    Comments on this notice are due by August 15, 2016 to be assured of consideration.

    ADDITIONAL INFORMATION:

    Contact Andrew Hatch, Chief, Program Services Branch, Marketing Order and Agreement Division, Specialty Crops Program, AMS, USDA, 1400 Independence Avenue SW., STOP 0237, Room 1406-S, Washington, DC, 20250-0237; Telephone (202) 720-6862 or Email: [email protected]

    Small businesses may request information on complying with this notice by contacting Antoinette Carter, Marketing Order and Agreement Division, Specialty Crops Program, AMS, USDA, 1400 Independence Avenue SW., STOP 0237, Washington, DC 20250-0237; Telephone: (202) 720-2491, Fax: (202) 720-8938, or Email: [email protected]

    Comments: Comments should reference the document number and the date and page number of this issue of the Federal Register, and be mailed to the Docket Clerk, Specialty Crops Program, AMS, USDA, 1400 Independence Avenue SW., Room 1406-S, Washington, DC 20250-0237; Fax: (202) 720-8938); or submitted through the Internet at http://www.regulations.gov.

    SUPPLEMENTARY INFORMATION:

    Title: Export Fruit Regulations—Export Apple Act (7 CFR part 33) and the Export Grape and Plum Act (7 CFR part 35).

    OMB Number: 0581-0143.

    Expiration Date of Approval: August 31, 2016.

    Type of Request: Request for Renewal of a Recordkeeping Burden.

    Abstract: Fresh apples and grapes grown in the United States shipped to any foreign destination must meet minimum quality and other requirements established by regulations issued under the Export Apple Act (7 U.S.C. 581-590) and the Export Grape and Plum Act (7 U.S.C. 591-599) (Acts), which are found respectively at 7 CFR parts 33 and 35. Both Acts were designed to promote foreign trade in the export of apples, grapes and plums grown in the United States; to protect the reputation of the American-grown commodities; and to prevent deception or misrepresentation of the quality of such products moving in foreign commerce. The Acts have been in effect since 1933 (apples) and 1960 (grapes). Currently, plums are not regulated under the Export Grape and Plum Act.

    The Secretary of Agriculture is authorized to oversee the implementation of the Acts and issue regulations regarding that activity. Regulations issued under the Acts cover exports of fresh apples and grapes grown in the United States and shipped to foreign destinations, with the exception of grapes shipped to Canada or Mexico and apples in bulk bins shipped to Canada. Certain limited quantity provisions may exempt some shipments from this information collection. Regulations issued under the Acts (7 CFR 33.11 for apples, and § 35.12 for grapes) require that the U.S. Department of Agriculture (USDA) officially inspect and certify that each export shipment of fresh apples and grapes is in compliance with quality and shipping requirements effective under the Acts.

    The information collection requirements in this request are essential to carry out the intent and administration of the Acts. The currently approved collection under OMB No. 0581-0143 authorizes the use of an Export Form Certificate. Federal or Federal-State Inspection Program (FSIP) inspectors use the Export Form Certificate (FV-207) to certify inspection of the shipment for exports bound for non-Canadian destinations. The completed FV-207 is issued to the shipper. The shipper provides the carrier with the completed certificate to verify compliance with the Acts. Under the current regulations issued under the Acts, the carrier is required to maintain the certificates for no less than three (3) years. The information collection requirements in this request impose only the minimum burden necessary to effectively administer the Acts. The information collection burden for this action is primarily in the form of recordkeeping; the certificates are not filed with USDA.

    USDA intends to update the text of the FV-207 to expand its scope to include inspection certificates for export shipments bound for Canadian destinations and rename it FV-205. Shipper and carriers do not complete the FV-207; they are only required to maintain the completed FV-207 record. USDA proposes a decrease to the time required to complete this information collection from 15 minutes per response to 5 minutes per response to complete the related recordkeeping actions of the shipper delivering a copy of the certificate to the carrier and the carrier keeping the certificate on file for not less than 3 years.

    In the last renewal of the collection in 2013, there were inaccurate calculations related to the burden. The last renewal of the collection in 2013 reported that 102 respondents (68 shippers and 15 carriers for exported apples, and 14 shippers and 5 carriers for exported grapes) used FV-207 for an estimated one response per respondent. This suggested that there were only 102 FV-207 certificates issued. However, USDA's Foreign Agricultural Service estimates that, for the five-year period 2011-2015, the average number of export apple and grape shipments requiring inspection per year was 42,326 for apples and 10,462 for grapes, for a total five-year average of 52,788 certificates per year that would need to be maintained. Current industry data indicates a decrease in the recordkeepers from 102 to 94, as there is a reduction in the estimated number of export apple shippers (from 68 to 60) but no changes in the estimated number of export grape shippers (14), or carriers of export apples (15) and grapes (5). In this renewal of the collection in 2016, USDA will update the calculation to reflect an estimated 564 responses per recordkeeper for apples, which is approximately the 42,326 certificates divided by the 75 apple shippers and carriers, and an estimated 550 responses per recordkeeper for grapes, which is approximately the 10,462 certificates divided by the 19 grape shippers and carriers. USDA calculates the estimated total annual burden on respondents would change from the inaccurate 25 hours to the more accurate 4381 hours estimate.

    Estimate of Burden: Public recordkeeping burden for this collection of information is estimated to average 0.083 hours per response.

    Respondents (Recordkeepers): Apple and grape export shippers and carriers.

    Estimated Number of Recordkeepers: 94 (75 shippers and carriers of exported apples and 19 shippers and carriers of exported grapes).

    Estimated Total Annual Responses: 52,788.

    Estimated Number of Responses per Recordkeeper: 564 for apples and 550 for grapes.

    Estimated Total Annual Burden on Recordkeepers: 4381 hours.

    Comments are invited on: (1) Whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility; (2) the accuracy of the agency's estimate of the burden of the proposed collection of information including the validity of the methodology and assumptions used; (3) ways to enhance the quality, utility, and clarity of the information to be collected; and (4) ways to minimize the burden of the collection of information on those who are to respond, including the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology.

    All responses to this notice will be summarized and included in the request for OMB approval. All comments will also become a matter of public record. All comments received will be available for public inspection at the street address in the “Comment” section and can be viewed at: www.regulations.gov.

    Dated: June 8, 2016. Elanor Starmer, Administrator, Agricultural Marketing Service.
    [FR Doc. 2016-14007 Filed 6-13-16; 8:45 am] BILLING CODE 3410-02-P
    DEPARTMENT OF AGRICULTURE Animal and Plant Health Inspection Service [Docket No. APHIS-2016-0037] Notice of Request for Extension of Approval of an Information Collection; Importation of Live Swine, Pork and Pork Products, and Swine Semen From the European Union AGENCY:

    Animal and Plant Health Inspection Service, USDA.

    ACTION:

    Extension of approval of an information collection; comment request.

    SUMMARY:

    In accordance with the Paperwork Reduction Act of 1995, this notice announces the Animal and Plant Health Inspection Service's intention to request an extension of approval of an information collection associated with regulations for the importation of live swine, pork and pork products, and swine semen from the European Union.

    DATES:

    We will consider all comments that we receive on or before August 15, 2016.

    ADDRESSES:

    You may submit comments by either of the following methods:

    Federal eRulemaking Portal: Go to http://www.regulations.gov/#!docketDetail;D=APHIS-2016-0037.

    Postal Mail/Commercial Delivery: Send your comment to Docket No. APHIS-2016-0037, Regulatory Analysis and Development, PPD, APHIS, Station 3A-03.8, 4700 River Road, Unit 118, Riverdale, MD 20737-1238.

    Supporting documents and any comments we receive on this docket may be viewed at http://www.regulations.gov/#!docketDetail;D=APHIS-2016-0037 or in our reading room, which is located in room 1141 of the USDA South Building, 14th Street and Independence Avenue SW., Washington, DC. Normal reading room hours are 8 a.m. to 4:30 p.m., Monday through Friday, except holidays. To be sure someone is there to help you, please call (202) 799-7039 before coming.

    FOR FURTHER INFORMATION CONTACT:

    For information regarding the regulations for the importation of live swine, pork and pork products, and swine semen from the European Union, contact Dr. Lynette Williams, Senior Staff Veterinarian, Animal Products, NIES, VS, APHIS, 4700 River Road, Unit 40, Riverdale, MD 20737-1236; (301) 851-3300. For copies of more detailed information on the information collection, contact Ms. Kimberly Hardy, APHIS' Information Collection Coordinator, at (301) 851-2727.

    SUPPLEMENTARY INFORMATION:

    Title: Importation of Live Swine, Pork and Pork Products, and Swine Semen from the European Union.

    OMB Control Number: 0579-0218.

    Type of Request: Extension of approval of an information collection.

    Abstract: Under the Animal Health Protection Act (7 U.S.C. 8301 et seq.), the Animal and Plant Health Inspection Service (APHIS) of the United States Department of Agriculture is authorized, among other things, to prohibit or restrict the importation and interstate movement of animals and animal products to prevent the introduction into and dissemination within the United States of livestock diseases and pests. To carry out this mission, APHIS regulates the importation of animals and animal products into the United States.

    The regulations in title 9 of the Code of Federal Regulations (9 CFR), part 94, prohibit or restrict the importation of specified animals and animal products to prevent the introduction of diseases such as classical swine fever (CSF), rinderpest, foot-and-mouth disease, swine vesicular disease, and African swine fever. Among other things, part 94 lists the requirements for the importation of pork and pork products and live swine where these diseases exist. Section 94.31 lists the requirements for the importation of pork, pork products, and breeding swine from the European Union (“the APHIS-defined European CSF region”). Section 98.38 lists the requirements for the importation of swine semen from the APHIS-defined European CSF region.

    These regulations require information collection activities, such as a certificate for pork and pork products, breeding swine, and swine semen; application for import or in-transit permit; and declaration of importation.

    The activities above were previously approved by the Office of Management and Budget (OMB) under collections 0579-0218 and 0579-0265. In our last extension of approval, we announced that we were combining the two collections and retiring 0579-0265. When we combined the collections, we did not accurately adjust the estimated burden. In addition, we have increased the estimates of burden to reflect the increased consumer demand for pork and pork products and to account for the return of the declaration of importation to APHIS from U.S. Customs and Border Protection. We have adjusted the estimates of burden accordingly.

    We are asking OMB to approve our use of these information collection activities for an additional 3 years.

    The purpose of this notice is to solicit comments from the public (as well as affected agencies) concerning this information collection. These comments will help us:

    (1) Evaluate whether the collection of information is necessary for the proper performance of the functions of the Agency, including whether the information will have practical utility;

    (2) Evaluate the accuracy of our estimate of the burden of the collection of information, including the validity of the methodology and assumptions used;

    (3) Enhance the quality, utility, and clarity of the information to be collected; and

    (4) Minimize the burden of the collection of information on those who are to respond, through use, as appropriate, of automated, electronic, mechanical, and other collection technologies; e.g., permitting electronic submission of responses.

    Estimate of burden: The public reporting burden for this collection of information is estimated to average 1 hour per response.

    Respondents: Foreign government animal health officials.

    Estimated annual number of respondents: 21.

    Estimated annual number of responses per respondent: 20,951.

    Estimated annual number of responses: 439,976.

    Estimated total annual burden on respondents: 440,374 hours. (Due to averaging, the total annual burden hours may not equal the product of the annual number of responses multiplied by the reporting burden per response.)

    All responses to this notice will be summarized and included in the request for OMB approval. All comments will also become a matter of public record.

    Done in Washington, DC, this 8th day of June 2016. Kevin Shea, Administrator, Animal and Plant Health Inspection Service.
    [FR Doc. 2016-14079 Filed 6-13-16; 8:45 am] BILLING CODE 3410-34-P
    DEPARTMENT OF AGRICULTURE Food and Nutrition Service Agency Information Collection Activities: Proposed Collection: Comment Request—Professional Standards Training Tracker Tool AGENCY:

    Food and Nutrition Service (FNS), USDA.

    ACTION:

    Notice.

    SUMMARY:

    In accordance with the Paperwork Reduction Act of 1995, this notice invites the general public and other public agencies to comment on this proposed information collection. This collection is a new collection for assisting state agencies to record, track and manage the required training hours in four major areas (Nutrition, Operations, Administration, Communications and Marketing) to meet the requirements of the Healthy Hunger Free Kids Act (HHFKA) of 2010 Professional Standards Rule. The HHFKA (section 306) requires Professional Standards for state and local school district nutrition professionals. In addition to hiring standards, mandatory annual training will be required for all individuals involved in preparing school meals. To meet the training requirements and assist in keeping track of training courses, FNS is developing a web-based application tool with a SQL-server database which will be made available to local educational agencies and school food authorities through the FNS public Web site. While training requirements are mandatory, using the USDA Tracking Tool is voluntary. School nutrition professionals can use any method to track and manage their trainings. These resources will facilitate compliance with HHFKA requirements and will be provided at no cost to the state, district, or individuals.

    DATES:

    Written comments must be received on or before August 15, 2016.

    ADDRESSES:

    Comments are invited on: (a) Whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information shall have practical utility; (b) the accuracy of the agency's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions that were used; (c) ways to enhance the quality, utility, and clarity of the information to be collected; and (d) ways to minimize the burden of the collection of information on those who are to respond, including use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology.

    Comments may be sent to: Kaushalya Heendeniya, Food and Nutrition Service, U.S. Department of Agriculture, 3101 Park Center Drive, Room 630, Alexandria, VA 22302. Comments may also be submitted via fax to the attention of Kaushalya Heendeniya at 703-305-2549 or via email to [email protected] Comments will also be accepted through the Federal eRulemaking Portal. Go to http://www.regulations.gov, and follow the online instructions for submitting comments electronically.

    All responses to this notice will be summarized and included in the request for Office of Management and Budget approval. All comments will be a matter of public record.

    FOR FURTHER INFORMATION CONTACT:

    Requests for additional information or copies of this information collection should be directed to Kaushalya Heendeniya at 703-305-0037.

    SUPPLEMENTARY INFORMATION:

    Title: Professional Standards Training Tracker Tool.

    Form Number: 0584—NEW.

    Expiration Date: Not Yet Determined.

    Type of Request: New Collection.

    Abstract: The Healthy Hunger Free Kids Act of 2010 (section 306) requires Professional Standards for state and local school district nutrition professionals. In addition to hiring standards, mandatory annual training will be required for all individuals involved in preparing school meals. To meet the training requirements and assist in keeping track of training and training courses, FNS is developing a web-based application tool with a SQL-server database which will be made available to local educational agencies and school food authorities through the FNS public Web site, with a login authentication. These resources will facilitate compliance with HHFKA requirements and will be provided at no cost to the state, district, or individuals. In addition, there will be a mobile friendly version of this Professional Standards Training Tracking Tool application to ensure easy usage and accessibility across mobile devices. The application will be compatible with all mobile operating systems (iOS, Android, and Windows).

    The user will be able to create a user profile with the following information:

    • School District/Address • School Name/Address • Individual Name—Contact Information/Email address • Title of Individual or Role in school nutrition program • Hiring Date

    The user will be logging in the following information:

    • Key Area • Training Topic • Learning Objective • Training Title • Training Hours/Minutes • Date of Training • Provider or Organization offering training, including state, local or national • Level of Training by employee position (e.g. employee, manager, etc.)

    The user will have the ability to enter multiple names for one specific training without having to repeatedly enter training information. Certificates of completion can be printed. The tool will also provide the user the ability to export and save results in multiple file formats, including PDF (.pdf), Excel and Word 2000 or higher (.docx). It will have a user-centered, simple, intuitive interface. Streamlined and intuitive navigation will be offered for easy access to all functionality.

    Affected Public: Individual/Households and State, Local, and Tribal Government. Respondent groups include local educational agencies, school food authorities, and school nutrition professionals.

    Estimated Number of Respondents: The total estimated number of respondents is 10,006. This includes 6 State agency personnel and 10,000 school nutrition professionals who voluntarily choose to utilize this tracking tool. All respondents will be offered a 60 minute training webinar.

    Estimated Number of Responses per Respondent: Total estimated number of responses per respondent across the entire collection is six. The estimated number of responses per respondent for the tracking tool is five. The tracking tool users will be first required to create their user profile which will be saved for future use. It is estimated that the user will be updating and managing their records on a quarterly basis. The estimated number of responses per respondent for the training webinar is one.

    Estimated Total Annual Responses: 60,036.

    Estimated Time per Response: The estimated time per response across the entire collection is approximately 16 minutes (0.27 hours). For the training tracking tool, the estimated time of response varies from five to ten minutes depending on familiarity of the tool and the amount of reports created with an average estimated time of 7.5 minutes (0.125 hours) for all participants. The training webinar of 60 minutes (1 hour) will be available for all participants.

    Estimated Total Annual Burden on Respondents: 16,259.75 hours (rounded to 16,260 hours). See the table below for estimated total annual burden for each type of respondent.

    Respondent Estimated # respondent Responses annually per respondent Total annual responses (col. b × c) Estimated avg. # of hours per response Estimated
  • total hours
  • (col. d × e)
  • Reporting Burden for State, Local, and Tribal Govt State agency Personnel 6 5 30 0.125 3.75 Training Webinar 6 1 6 1 6 Subtotal for State, Local, and Tribal Government 6 6 36 0.27 9.75 Reporting Burden for Individuals/Households School Nutrition Professionals 10,000 5 50,000 0.125 6,250 Training Webinar 10,000 1 10,000 1 10,000 Subtotal for Individuals/Households 10,000 6 60,000 0.27 16,250 Total Reporting Burden 10,006 60,036 16,259.75
    Dated: June 2, 2016. Audrey Rowe, Administrator, Food and Nutrition Service.
    [FR Doc. 2016-14008 Filed 6-13-16; 8:45 am] BILLING CODE 3410-30-P
    DEPARTMENT OF AGRICULTURE Forest Service Notice of Proposed New Fee Site; Federal Lands Recreation Enhancement Act AGENCY:

    Hoosier National Forest, Forest Service, USDA.

    ACTION:

    Notice of proposed new fee site.

    SUMMARY:

    The Hoosier National Forest is proposing to charge a fee at Saddle Lake Recreation Area Campground. This includes a $5 fee at Saddle Lake Campground per site per night year round. Fees are assessed based on the level of amenities and services provided, cost of operations and maintenance, and market assessment. The fee is proposed and will be determined upon further analysis and public comment. Funds from fees would be used for the continued operation and maintenance and improvements of the campground.

    An analysis of the nearby state campground with similar amenities shows that the proposed fee is reasonable and typical of similar sites in the area.

    DATES:

    Comments will be accepted through December 31, 2016. New fees would begin approximately April 2017.

    ADDRESSES:

    Michael Chaveas, Forest Supervisor, Hoosier National Forest, 811 Constitution Ave., Bedford, IN 47121.

    FOR FURTHER INFORMATION CONTACT:

    Nancy Myers, Outdoor Recreation Planner, 812-547-9241. Information about the proposed fee can also be found on the Hoosier National Forest Web site: http://www.fs.usda.gov/hoosier.

    SUPPLEMENTARY INFORMATION:

    The Federal Recreation Lands Enhancement Act (Title VII, Pub. L. 108-447) directed the Secretary of Agriculture to publish a six month advance notice in the Federal Register whenever new recreation fee areas are established.

    Once public involvement is complete, these new fees will be reviewed by a Recreation Resource Advisory Committee prior to a final decision and implementation. People wanting reserve these cabins would need to do so through the National Recreation Reservation Service, at www.recreation.gov or by calling 1-877-444-6777 when it becomes available.

    Dated: June 8, 2016. Michael Chaveas, Forest Supervisor.
    [FR Doc. 2016-13992 Filed 6-13-16; 8:45 am] BILLING CODE 3410-11-P
    DEPARTMENT OF AGRICULTURE Forest Service Chippewa National Forest Resource Advisory Committee AGENCY:

    Forest Service, USDA.

    ACTION:

    Notice of meeting.

    SUMMARY:

    The Chippewa National Forest (NF) Resource Advisory Committee (RAC) will meet in Walker Minnesota. The committee is authorized under the Secure Rural Schools and Community Self-Determination Act (the Act) and operates in compliance with the Federal Advisory Committee Act. The purpose of the committee is to improve collaborative relationships and to provide advice and recommendations to the Forest Service concerning projects and funding consistent with title II of the Act. RAC information can be found at the following Web site: http://www.fs.usda.gov/chippewa.

    DATES:

    The meeting will be held on Thursday, July 14, 2016, at 9:00 a.m.

    All RAC meetings are subject to cancellation. For status of meeting prior to attendance, please contact the person listed under For Further Information Contact.

    ADDRESSES:

    The meeting will be held at the Walker Ranger District, Main Conference Room, 201 Minnesota Avenue East, Walker, Minnesota.

    Written comments may be submitted as described under Supplementary Information. All comments, including names and addresses when provided, are placed in the record and are available for public inspection and copying. The public may inspect comments received at Chippewa NF Supervisor's Office. Please call ahead to facilitate entry into the building.

    FOR FURTHER INFORMATION CONTACT:

    Todd Tisler, RAC Coordinator, by phone at 218-335-8629 or via email at [email protected]

    Individuals who use telecommunication devices for the deaf (TDD) may call the Federal Information Relay Service (FIRS) at 1-800-877-8339 between 8:00 a.m. and 8:00 p.m., Eastern Standard Time, Monday through Friday.

    SUPPLEMENTARY INFORMATION:

    The purpose of the meeting is to:

    1. Introduce new RAC committee members,

    2. Review RAC members' roles and responsibilities, and

    3. Develop project priorities.

    The meeting is open to the public. The agenda will include time for people to make oral statements of three minutes or less. Individuals wishing to make an oral statement should request in writing by June 27, 2016, to be scheduled on the agenda. Anyone who would like to bring related matters to the attention of the committee may file written statements with the committee staff before or after the meeting. Written comments and requests for time to make oral comments must be sent to Todd Tisler, RAC Coordinator, Chippewa NF Supervisor's Office, 200 Ash Avenue Northwest, Cass Lake, Minnesota 56633; by email to [email protected] or via facsimile to 218-335-8637.

    Meeting Accommodations: If you are a person requiring reasonable accommodation, please make requests in advance for sign language interpreting, assistive listening devices, or other reasonable accommodation. For access to the facility or proceedings, please contact the person listed in the section titled FOR FURTHER INFORMATION CONTACT. All reasonable accommodation requests are managed on a case by case basis.

    Dated: June 7, 2016. Darla Lenz, Forest Supervisor.
    [FR Doc. 2016-13985 Filed 6-13-16; 8:45 am] BILLING CODE 3411-15-P
    DEPARTMENT OF AGRICULTURE Rural Utilities Service Announcement of Application Deadlines and Requirements for Section 313A Guarantees for Bonds and Notes Issued for Electrification or Telephone Purposes Loan Program for Fiscal Year (FY) 2016 AGENCY:

    Rural Utilities Service, USDA.

    ACTION:

    Notice of Solicitation of Applications (NOSA).

    SUMMARY:

    The Rural Utilities Service (RUS), an agency of the United States Department of Agriculture (USDA), announces the application window, requirements and funding for up to $750 million of loan funds available for Fiscal Year (FY) 2016 under the Guarantees for Bonds and Notes Issued for Electrification or Telephone Purposes Program (the 313A Program) authorized under the Rural Electrification Act of 1936, as amended, and related terms. Under the 313A Program, the Federal Financing Bank (FFB) will make loans to the selected applicant(s) and RUS will guarantee the applicant(s)'s repayment of the loans to FFB. Selected applicants may use the proceeds of loan funds made available under the 313A Program to make loans to borrowers for electrification or telecommunications purposes, or to refinance bonds or notes previously issued by applicants for such purposes. The proceeds of the guaranteed bonds and notes are not to be used by applicants to directly or indirectly fund projects for the generation of electricity.

    DATES:

    Completed applications must be received by RUS no later than 5:00 p.m. Eastern Daylight Time (EDT) on Friday, July 15.

    ADDRESSES:

    Applicants are required to submit one original and two copies of their loan applications to the U.S. Department of Agriculture, Rural Utilities Service, Electric Program, ATTN: Amy McWilliams, Management Analyst, 1400 Independence Avenue SW., STOP 1568, Room 0226-S, Washington, DC 20250-1568.

    FOR FURTHER INFORMATION CONTACT:

    For further information contact Amy McWilliams, Management Analyst, 1400 Independence Avenue SW., STOP 1568, Room 0226-S, Washington, DC 20250-1568. Telephone: (202) 205-8663; email: [email protected].

    SUPPLEMENTARY INFORMATION:

    Overview

    Federal Agency: Rural Utilities Service, USDA.

    Funding Opportunity Title: Guarantees for Bonds and Notes Issued for Electrification or Telephone Purposes for Fiscal Year (FY) 2016.

    Announcement Type: Guarantees for Bonds and Notes.

    Catalog of Federal Domestic Assistance (CFDA) Number: 10.850

    Due Date for Applications: Applications must be received by RUS by 5:00 p.m. Eastern Daylight Time (EDT) on June 15, 2016.

    Items in Supplementary Information I. Funding Opportunity Description II. Award Information III. Eligibility Information IV. Fiscal Year 2016 Application and Submission Information V. Application Review Information VI. Issuance of the Guarantee VII. Guarantee Agreement VIII. Reporting Requirements IX. Award Administration Information X. National Environmental Policy Act Certification XI. Other Information and Requirements XII. Agency Contacts: Web Site, Phone, Fax, Email, Contact Name XIII. Non-Discrimination Statement: USDA Non-Discrimination Statement, How to File a Complaint, Persons With Disabilities I. Funding Opportunity Description A. Purpose of the 313A Program

    The purpose of the 313A Program is to make guaranteed loans to selected applicants (each referred to as “Guaranteed Lender” in this NOSA and in the Program Regulations) that are to be used (i) to make loans for electrification or telecommunications purposes eligible for assistance under the RE Act (defined herein) and regulations for the 313A Program located at 7 CFR part 1720 (also referred to as the “Program Regulations” in this NOSA), or (ii) to refinance bonds or notes previously issued by the Guaranteed Lender for such purposes. The proceeds of the guaranteed bonds and notes are not to be used by the Guaranteed Lender to directly or indirectly fund projects for the generation of electricity.

    B. Statutory Authority

    The 313A Program is authorized by Section 313A of the Rural Electrification Act of 1936, as amended (7 U.S.C. 940c-1) (the RE Act) and is implemented by regulations located at 7 CFR part 1720. The Administrator of RUS (the Administrator) has been delegated responsibility for administering the 313A Program.

    C. Definition of Terms

    The definitions applicable to this NOSA are published at 7 CFR § 1720.3.

    D. Application Awards

    RUS will review and evaluate applications received in response to this NOSA based on the regulations at 7 CFR § 1720.7, and as provided in this NOSA.

    II. Award Information

    Type of Awards: Guaranteed Loans.

    Fiscal Year Funds: FY 2016.

    Available Funds: $750 million.

    Award Amounts: RUS anticipates making multiple approvals under this NOSA. The number and amount of awards under this NOSA will depend on the number of eligible applications and the amount of funds requested. Loans will only be made on an amortized basis.

    Application Date: Applications must be received by RUS by no later than 5:00 p.m. EDT on June 15, 2016.

    Award Date: Awards will be made on or before September 30, 2016.

    Schedule of Loan Repayment: Amortization Method (level debt service).

    III. Eligibility Information A. Eligible Applicants

    1. To be eligible to participate in the 313A Program, a Guaranteed Lender must be:

    a. A bank or other lending institution organized as a private, not-for-profit cooperative association, or otherwise organized on a non-profit basis; and

    b. Able to demonstrate to the Administrator that it possesses the appropriate expertise, experience, and qualifications to make loans for electrification or telephone purposes.

    2. To be eligible to receive a guarantee, a Guaranteed Lender's bond must meet the following criteria:

    a. The Guaranteed Lender must furnish the Administrator with a certified list of the principal balances of eligible loans outstanding and certify that such aggregate balance is at least equal to the sum of the proposed principal amount of guaranteed bonds to be issued, including any previously issued guaranteed bonds outstanding;

    b. The guaranteed bonds to be issued by the Guaranteed Lender would receive an underlying investment grade rating from a Rating Agency, without regard to the guarantee; and

    c. A lending institution's status as an eligible applicant does not assure that the Administrator will issue the guarantee sought in the amount or under the terms requested, or otherwise preclude the Administrator from declining to issue a guarantee.

    B. Other Eligibility Requirements

    Applications will only be accepted from lenders that serve rural areas defined in 7 CFR § 1710.2(a) as (i) Any area of the United States, its territories and insular possessions (including any area within the Federated States of Micronesia, the Marshall Islands, and the Republic of Palau) other than a city, town, or unincorporated area that has a population of greater than 20,000 inhabitants; and (ii) Any area within a service area of a borrower for which a borrower has an outstanding loan as of June 18, 2008, made under titles I through V of the Rural Electrification Act of 1936 (7 U.S.C. 901-950bb). For initial loans to a borrower made after June 18, 2008, the “rural” character of an area is determined at the time of the initial loan to furnish or improve service in the area.

    IV. Fiscal Year 2016 Application and Submission Information A. Applications

    All applications must be prepared and submitted in accordance with this NOSA and 7 CFR § 1720.6 (Application Process). To ensure the proper preparation of applications, applicants should carefully read this NOSA and 7 CFR part 1720 (available online at http://www.ecfr.gov/cgi-bin/text-idx?SID=9295e45c9a0f6a857d800fbec5dde2fb&mc=true&node=pt7.11.1720&rgn=div5).

    B. Content and Form of Submission

    In addition to the required application specified in 7 CFR § 1720.6, all applicants must submit the following additional required documents and materials:

    1. Form AD-1047, Certification Regarding Debarment, Suspension and Other Responsibility Matters Primary Covered Transactions. This form contains certain certifications relating to debarment and suspension, convictions, criminal charges, and the termination of public transactions (See 2 CFR part 417, and 7 CFR § 1710.123). This form is available at http://www.ocio.usda.gov/policy-directives-records-forms/forms-management/approved-computer-generated-forms;

    2. Restrictions on Lobbying. Applicants must comply with the requirements with respect to restrictions on lobbying activities. (See 2 CFR part 418, and 7 CFR § 1710.125). This form is available at http://www.rd.usda.gov/publications/regulations-guidelines/electric-sample-documents;

    3. Uniform Relocation Act assurance statement. Applicants must comply with 49 CFR part 24, which implements the Uniform Relocation Assistance and Real Property Acquisition Policy Act of 1970, as amended. (See 7 CFR § 1710.124.) This form is available at http://www.rd.usda.gov/publications/regulations-guidelines/electric-sample-documents;

    4. Federal debt delinquency requirements. This report indicates whether or not the applicants are delinquent on any Federal debt (See 7 CFR § 1710.126 and 7 CFR § 1710.501(a)(13)). This form is available at http://www.rd.usda.gov/publications/regulations-guidelines/electric-sample-documents;

    5. RUS Form 266, Compliance Assurance. Applicants must submit a non-discrimination assurance commitment to comply with certain regulations on non-discrimination in program services and benefits and on equal employment opportunity as set forth in 7 CFR parts 15 and 15b and 45 CFR part 90. This form is available at http://www.rd.usda.gov/publications/regulations-guidelines/electric-sample-documents;

    6. Articles of incorporation and bylaws: See 7 CFR § 1710.501(a)(14). These are required if either document has been amended since the last loan application was submitted to RUS, or if this is the applicant's first application for a loan under the RE Act;

    7. Form AD 3030, Representations Regarding Felony Conviction and Tax Delinquency Status for Corporation Applications. Applicants are required to complete this form if they are a corporation. This form is available at http://www.ocio.usda.gov/policy-directives-records-forms/forms-management/approved-computer-generated-forms; and

    8. Form AD 3031, Assurance Regarding Felony Conviction or Tax Delinquent Status for Corporate Applicants. Required as a condition to RUS making a loan commitment. This form is available at http://www.ocio.usda.gov/policy-directives-records-forms/forms-management/approved-computer-generated-forms.

    C. Supplemental Documents for Submission

    1. Cash flow projections and assumptions: Each applicant must include five-year pro-forma cash flow projections or business plans and clearly state the assumptions that underlie the projections, demonstrating that there is reasonable assurance that the applicant will be able to repay the guaranteed loan in accordance with its terms (See 7 CFR § 1720.6(4)).

    2. Pending litigation statement: A statement from the applicant's counsel listing any pending litigation, including levels of related insurance coverage and the potential effect on the applicant.

    V. Application Review Information A. Application Evaluation

    1. Administrator Review. Each application will be reviewed by the Administrator to determine whether it is eligible under 7 CFR § 1720.5, the information required under 7 CFR § 1720.6 is complete, and the proposed guaranteed bond complies with applicable statutes and regulations. The Administrator can at any time reject an application that fails to meet these requirements.

    a. Applications will be subject to a substantive review, on a competitive basis, by the Administrator based upon the evaluation factors listed in 7 CFR 1720.7(b).

    2. Decisions by the Administrator. The Administrator will approve or deny applications in a timely manner as such applications are received; provided, however, that in order to facilitate competitive evaluation of applications, the Administrator may from time to time defer a decision until more than one application is pending. The Administrator may limit the number of guarantees made to a maximum of five per year, to ensure a sufficient examination is conducted of applicant requests. RUS will notify the applicant in writing of the Administrator's approval or denial of an application. Approvals for guarantees will be conditioned upon compliance with7 CFR 1720.4 and 7 CFR 1720.6. The Administrator reserves the discretion to approve an application for an amount less than that requested.

    B. Independent Assessment

    Before a guarantee decision is made by the Administrator, the Administrator shall request that FFB review the rating agency determination required by 7 CFR 1720.5(b)(2) as to whether the bond or note to be issued would be below investment grade without regard to the guarantee.

    VI. Issuance of the Guarantee

    The requirements under this section must be met by the applicant prior to the endorsement of a guarantee by the Administrator (See 7 CFR 1720.8).

    VII. Guarantee Agreement

    Each Guaranteed Lender will be required to enter into a Guarantee Agreement with RUS that contains the provisions described in 7 CFR 1720.8 (Issuance of the Guarantee), 7 CFR 1720.9 (Guarantee Agreement), and 7 CFR 1720.12 (Reporting Requirements). The Guarantee Agreement will also obligate the Guaranteed Lender to pay, on a semi-annual basis, a guarantee fee equal to 15 basis points (0.15 percent) of the outstanding principal amount of the guaranteed loan (See 7 CFR 1720.10).

    VIII. Reporting Requirements

    Guaranteed Lenders are required to comply with the financial reporting requirements and pledged collateral review and certification requirements set forth in 7 CFR 1720.12.

    IX. Award Administration Information Award Notices

    RUS will send a commitment letter to an applicant once the loan is approved. Applicants must accept and commit to all terms and conditions of the loan which are requested by RUS and FFB as follows:

    1. Compliance conditions. In addition to the standard conditions placed on the section 313A Program or conditions requested by the Agency to ensure loan security and statutory compliance, applicants must comply with the following conditions:

    a. Each Guaranteed Lender selected under the 313A Program will be required to post collateral for the benefit of RUS in an amount equal to the aggregate amount of loan advances made to the Guaranteed Lender under the 313A Program.

    b. The pledged collateral shall consist of outstanding notes or bonds payable to the Guaranteed Lender (the Eligible Securities) and shall be placed on deposit with a collateral agent for the benefit of RUS. To be deemed Eligible Securities that can be pledged as collateral, the notes or bonds to be pledged (i) cannot be classified as non-performing, impaired, or restructured under generally accepted accounting principles, (ii) cannot be comprised of more than 30% of bonds or notes from generation and transmission borrowers or (iii) cannot have more than 5% of notes and bonds be from any one particular borrower.

    c. The Guaranteed Lender will be required to place a lien on the pledged collateral in favor of RUS (as secured party) at the time that the pledged collateral is deposited with the collateral agent. RUS will have the right, in its sole discretion, within 14 business days to reject and require the substitution of any Pledged Collateral that the Guaranteed Lender deposits as collateral with the collateral agent. Prior to receiving any advances under the 313A Program, the Guaranteed Lender will be required to enter into a pledge agreement, satisfactory to RUS, with a banking institution serving as collateral agent.

    d. Applicants must certify to the RUS, the portion of their Eligible Loan portfolio that is:

    (1) Refinanced RUS debt;

    (2) Debt of borrowers for whom both RUS and the applicants have outstanding loans; and

    (3) Debt of borrowers for whom both RUS and the applicant have outstanding concurrent loans pursuant to Section 307 of the RE Act, and the amount of Eligible Loans.

    2. Compliance with Federal Laws. Applicants must comply with all applicable Federal laws and regulations.

    a. This obligation is subject to the provisions contained in the Consolidated Appropriations Act, 2016, Public Law 114-113, Division A, Title VII, Sections 745 and 746, as amended and/or subsequently enacted for USDA agencies and offices regarding corporate felony convictions and corporate federal tax delinquencies.

    b. The Chairman or the Board President authorized by your organization to execute the loan documents must execute, date, and return the loan commitment letter and the Assurance Regarding Felony Conviction or Tax Delinquent Status for Corporate Applicants (Form AD-3031) to RUS by September 30, 2016; otherwise, the commitment will be void.

    c. Additional conditions may be instituted for future obligations.

    X. National Environmental Policy Act Certification

    For any proceeds to be used to refinance bonds and notes previously issued by the Guaranteed Lender for the RE Act purposes that are not obligated with specific projects, RUS has determined that these financial actions will not individually or cumulatively have a significant effect on the human environment as defined by the National Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.) and its implementing regulations at 40 CFR parts 1500-1508. However, for any new projects funded under the 313A Program, applicants must consult with RUS and comply with the Agency regulations at 7 CFR part 1970.

    XI. Other Information and Requirements

    Applications must contain all of the required elements of this NOSA and all standard requirements as required by 7 CFR part 1720. Additional supporting data or documents may be required by RUS depending on the individual application or financial conditions. All applicants must comply with all Federal Laws and Regulations.

    XII. Agency Contacts

    A. Web site: http://www.rd.usda.gov/programs-services/all-programs/electric-programs.

    B. Phone: 202-205-8663.

    C. Fax: (202) 720-1401 or (202) 205-1264.

    D. Email: [email protected]

    E. Main point of contact: Amy McWilliams, Management Analyst, 1400 Independence Avenue SW., STOP 1568, Room 0226-S, Washington, DC 20250-1568.

    XIII. USDA Non-Discrimination Statement

    In accordance with Federal civil rights law and U.S. Department of Agriculture (USDA) civil rights regulations and policies, the USDA, its Agencies, offices, and employees, and institutions participating in or administering USDA programs are prohibited from discriminating based on race, color, national origin, religion, sex, gender identity (including gender expression), sexual orientation, disability, age, marital status, family/parental status, income derived from a public assistance program, political beliefs, or reprisal or retaliation for prior civil rights activity, in any program or activity conducted or funded by USDA (not all bases apply to all programs). Remedies and complaint filing deadlines vary by program or incident.

    Persons with disabilities who require alternative means of communication for program information (e.g., Braille, large print, audiotape, American Sign Language, etc.) should contact the responsible Agency or USDA's TARGET Center at (202) 720-2600 (voice and TTY) or contact USDA through the Federal Relay Service at (800) 877-8339. Additionally, program information may be made available in languages other than English.

    To file a program discrimination complaint, complete the USDA Program Discrimination Complaint Form, AD-3027. This form is available at http://www.ocio.usda.gov/policy-directives-records-forms/forms-management/approved-computer-generated-forms and at any USDA office or write a letter addressed to USDA and provide in the letter all of the information requested in the form. To request a copy of the complaint form, call (866) 632-9992. Submit your completed form or letter to USDA by:

    (1) Mail: U.S. Department of Agriculture, Office of the Assistant Secretary for Civil Rights, 1400 Independence Avenue SW., Washington, DC 20250-9410;

    (2) Fax: (202) 690-7442; or

    (3) Email: [email protected] USDA is an equal opportunity provider, employer, and lender.

    Authority:

    7 U.S.C. 940c-1.

    Dated: April 22, 2016. Brandon McBride, Administrator, Rural Utilities Service.
    [FR Doc. 2016-14009 Filed 6-13-16; 8:45 am] BILLING CODE P
    DEPARTMENT OF COMMERCE International Trade Administration [A-533-813] Certain Preserved Mushrooms From India: Rescission of Antidumping Duty Administrative Review; 2015-2016 AGENCY:

    Enforcement and Compliance, International Trade Administration, Department of Commerce.

    SUMMARY:

    The Department of Commerce (the Department) is rescinding the administrative review of the antidumping duty order on certain preserved mushrooms from India for the period February 1, 2015, through January 31, 2016.

    DATES:

    Effective Date: June 14, 2016.

    FOR FURTHER INFORMATION CONTACT:

    Kate Johnson or Terre Keaton Stefanova, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue NW., Washington, DC 20230; telephone: (202) 482-4929 or (202) 482-1280, respectively.

    SUPPLEMENTARY INFORMATION: Background

    On February 3, 2016, the Department published in the Federal Register a notice of “Opportunity to Request Administrative Review” of the antidumping duty order on certain preserved mushrooms from India for the period of February 1, 2015, through January 31, 2016.1

    1See Antidumping or Countervailing Duty Order, Finding, or Suspended Investigation; Opportunity to Request Administrative Review, 81 FR 5712 (February 3, 2016).

    On February 29, 2016, in accordance with section 751(a) of the Tariff Act of 1930, as amended (the Act), and 19 CFR 351.213(b), the Department received a timely request from Monterey Mushrooms, Inc., a petitioner and domestic interested party in this proceeding, to conduct an administrative review of the sales of Agro Dutch Foods Limited (Agro Dutch Industries Limited) (Agro Dutch); Himalya International Ltd. (Himalya); Hindustan Lever Ltd. (formerly Ponds India, Ltd.) (Hindustan); Transchem, Ltd. (Transchem); and Weikfield Foods Pvt. Ltd. (Weikfield). The petitioner was the only party to request this administrative review.

    On April 7, 2016, the Department published in the Federal Register a notice of initiation of an administrative review of the antidumping duty order on certain preserved mushrooms from India with respect to Agro Dutch, Himalya, Hindustan, Transchem, and Weikfield.2

    2See Initiation of Antidumping and Countervailing Duty Administrative Reviews, 81 FR 20324 (April 7, 2016).

    On May 13, 2016, the petitioner timely withdrew its request for a review of Agro Dutch, Himalya, Hindustan, Transchem, and Weikfield.3

    3See petitioner's letter, “17th Administrative Review of the Antidumping Duty Order on Certain Preserved Mushrooms form India—Petitioner's Withdrawal of Requests for Review,” dated May 13, 2016.

    Rescission of Review

    Pursuant to 19 CFR 351.213(d)(1), the Department will rescind an administrative review, in whole or in part, if a party that requested a review withdraws the request within 90 days of the date of publication of the notice of initiation of the requested review. The petitioner timely withdrew its review request for all companies before the 90-day deadline, and no other party requested an administrative review of the antidumping duty order. Therefore, we are rescinding in its entirety the administrative review of the antidumping duty order on certain preserved mushrooms from India covering the period February 1, 2015, through January 31, 2016.

    Assessment

    The Department will instruct U.S. Customs and Border Protection (CBP) to assess antidumping duties on all appropriate entries. Antidumping duties shall be assessed at rates equal to the cash deposit of estimated antidumping duties required at the time of entry, or withdrawal from warehouse, for consumption, in accordance with 19 CFR 351.212(c)(1)(i). The Department intends to issue appropriate assessment instructions directly to CBP 15 days after the date of publication of this notice in the Federal Register.

    Notification to Importers

    This notice serves as the only reminder to importers of their responsibility, under 19 CFR 351.402(f)(2), to file a certificate regarding the reimbursement of antidumping duties prior to liquidation of the relevant entries during this review period. Failure to comply with this requirement may result in the presumption that reimbursement of antidumping duties occurred and the subsequent assessment of double antidumping duties.

    Notification Regarding Administrative Protective Order

    This notice serves as the only reminder to parties subject to administrative protective order (APO) of their responsibility concerning the disposition of proprietary information disclosed under APO in accordance with 19 CFR 351.305(a)(3). Timely written notification of return/destruction of APO materials or conversion to judicial protective order is hereby requested. Failure to comply with the regulations and the terms of an APO is a sanctionable violation.

    This notice is published in accordance with section 751 of the Act and 19 CFR 351.213(d)(4).

    Dated: June 8, 2016. Christian Marsh, Deputy Assistant Secretary for Antidumping and Countervailing Duty Operations.
    [FR Doc. 2016-14061 Filed 6-13-16; 8:45 am] BILLING CODE 3510-DS-P
    DEPARTMENT OF COMMERCE International Trade Administration [A-570-967] Aluminum Extrusions From the People's Republic of China: Preliminary Results of Antidumping Duty Administrative Review and Rescission of Review in Part; 2014-2015 AGENCY:

    Enforcement and Compliance, International Trade Administration, Department of Commerce.

    SUMMARY:

    The Department of Commerce (the Department) is conducting an administrative review of the antidumping duty order on aluminum extrusions from the People's Republic of China (PRC).1 The period of review (POR) is May 1, 2014 through April 30, 2015. These preliminary results cover 175 companies for which an administrative review was initiated.2 The Department selected the following companies as mandatory respondents: Guangzhou Jangho Curtain Wall System Engineering Co., Ltd. and Jangho Curtain Wall Hong Kong Ltd. (collectively, Jangho) and Guang Ya Aluminium Industries Co., Ltd., Foshan Guangcheng Aluminium Co., Ltd., Kong Ah International Company Limited, and Guang Ya Aluminium Industries (Hong Kong) Ltd. (collectively, Guang Ya Group); Guangdong Zhongya Aluminium Company Limited, Zhongya Shaped Aluminium (HK) Holding Limited, and Karlton Aluminum Company Ltd. (collectively, Zhongya); and Xinya Aluminum & Stainless Steel Product Co., Ltd. (Xinya) (collectively, Guang Ya Group/Zhongya/Xinya).3 The Department preliminarily determines that Jangho and Guang Ya Group/Zhongya/Xinya failed to cooperate by not acting to the best of their abilities to fully comply with the Department's requests for information, warranting the application of facts otherwise available with adverse inferences, pursuant to sections 776(a) and 776(b) of the Tariff Act of 1930, as amended (the Act). We also preliminarily determine that two companies, Xin Wei Aluminum Company Limited (Xin Wei) and Permasteelisa Hong Kong Limited, had no shipments. If these preliminary results are adopted in the final results of this review, we will instruct U.S. Customs and Border Protection (CBP) to assess antidumping duties on all appropriate entries. Interested parties are invited to comment on these preliminary results.

    1 The Department initiated this review on July 1, 2015. See Initiation of Antidumping and Countervailing Duty Administrative Reviews, 80 FR 37588 (July 1, 2015) (Initiation Notice).

    2Id., 80 FR at 37590-37593.

    3 In prior segments of this proceeding, the Department found that Guang Ya Group, Zhongya, and Xinya were affiliated with each other and should be treated as a single entity. See, e.g., Aluminum Extrusions From the People's Republic of China: Final Results of Antidumping Duty Administrative Review and Rescission, in Part, 2010/12, 79 FR 96 (January 2, 2014) (2010-2012 Final Results); Aluminum Extrusions From the People's Republic of China: Final Results of Antidumping Duty Administrative Review; 2012-2013, 79 FR 78784 (December 31, 2014) (2012-2013 Final Results); and Aluminum Extrusions From the People's Republic of China: Final Results of Antidumping Duty Administrative Review; 2013-2014, 80 FR 75060 (December 1, 2015) (2013-2014 Final Results).

    DATES:

    Effective Date: June 14, 2016.

    FOR FURTHER INFORMATION CONTACT:

    Deborah Scott, Mark Flessner or Robert James, AD/CVD Operations, Office VI, Enforcement and Compliance, International Trade Administration, Department of Commerce, 1401 Constitution Avenue NW., Washington, DC 20230; telephone: (202) 482-2657, (202) 482-6312 or (202) 482-0649, respectively.

    SUPPLEMENTARY INFORMATION:

    Scope of the Order

    The merchandise covered by the Order  4 is aluminum extrusions which are shapes and forms, produced by an extrusion process, made from aluminum alloys having metallic elements corresponding to the alloy series designations published by The Aluminum Association commencing with the numbers 1, 3, and 6 (or proprietary equivalents or other certifying body equivalents).5

    4See Aluminum Extrusions from the People's Republic of China: Antidumping Duty Order, 76 FR 30650 (May 26, 2011) (Order).

    5See Memorandum from Christian Marsh, Deputy Assistant Secretary for Antidumping and Countervailing Duty Operations to Paul Piquado, Assistant Secretary for Enforcement and Compliance, “Decision Memorandum for Preliminary Results of Antidumping Duty Administrative Review: Aluminum Extrusions from the People's Republic of China; 2014-2015,” dated concurrently with this notice (Preliminary Decision Memorandum) for a complete description of the scope of the Order.

    Imports of the subject merchandise are provided for under the following categories of the Harmonized Tariff Schedule of the United States (HTSUS): 8424.90.9080, 9405.99.4020, 9031.90.90.95, 7616.10.90.90, 7609.00.00, 7610.10.00, 7610.90.00, 7615.10.30, 7615.10.71, 7615.10.91, 7615.19.10, 7615.19.30, 7615.19.50, 7615.19.70, 7615.19.90, 7615.20.00, 7616.99.10, 7616.99.50, 8479.89.98, 8479.90.94, 8513.90.20, 9403.10.00, 9403.20.00, 7604.21.00.00, 7604.29.10.00, 7604.29.30.10, 7604.29.30.50, 7604.29.50.30, 7604.29.50.60, 7608.20.00.30, 7608.20.00.90, 8302.10.30.00, 8302.10.60.30, 8302.10.60.60, 8302.10.60.90, 8302.20.00.00, 8302.30.30.10, 8302.30.30.60, 8302.41.30.00, 8302.41.60.15, 8302.41.60.45, 8302.41.60.50, 8302.41.60.80, 8302.42.30.10, 8302.42.30.15, 8302.42.30.65, 8302.49.60.35, 8302.49.60.45, 8302.49.60.55, 8302.49.60.85, 8302.50.00.00, 8302.60.90.00, 8305.10.00.50, 8306.30.00.00, 8414.59.60.90, 8415.90.80.45, 8418.99.80.05, 8418.99.80.50, 8418.99.80.60, 8419.90.10.00, 8422.90.06.40, 8473.30.20.00, 8473.30.51.00, 8479.90.85.00, 8486.90.00.00, 8487.90.00.80, 8503.00.95.20, 8508.70.00.00, 8515.90.20.00, 8516.90.50.00, 8516.90.80.50, 8517.70.00.00, 8529.90.73.00, 8529.90.97.60, 8536.90.80.85, 8538.10.00.00, 8543.90.88.80, 8708.29.50.60, 8708.80.65.90, 8803.30.00.60, 9013.90.50.00, 9013.90.90.00, 9401.90.50.81, 9403.90.10.40, 9403.90.10.50, 9403.90.10.85, 9403.90.25.40, 9403.90.25.80, 9403.90.40.05, 9403.90.40.10, 9403.90.40.60, 9403.90.50.05, 9403.90.50.10, 9403.90.50.80, 9403.90.60.05, 9403.90.60.10, 9403.90.60.80, 9403.90.70.05, 9403.90.70.10, 9403.90.70.80, 9403.90.80.10, 9403.90.80.15, 9403.90.80.20, 9403.90.80.41, 9403.90.80.51, 9403.90.80.61, 9506.11.40.80, 9506.51.40.00, 9506.51.60.00, 9506.59.40.40, 9506.70.20.90, 9506.91.00.10, 9506.91.00.20, 9506.91.00.30, 9506.99.05.10, 9506.99.05.20, 9506.99.05.30, 9506.99.15.00, 9506.99.20.00, 9506.99.25.80, 9506.99.28.00, 9506.99.55.00, 9506.99.60.80, 9507.30.20.00, 9507.30.40.00, 9507.30.60.00, 9507.90.60.00, and 9603.90.80.50.

    The subject merchandise entered as parts of other aluminum products may be classifiable under the following additional Chapter 76 subheadings: 7610.10, 7610.90, 7615.19, 7615.20, and 7616.99, as well as under other HTSUS chapters. In addition, fin evaporator coils may be classifiable under HTSUS numbers: 8418.99.80.50 and 8418.99.80.60. While HTSUS subheadings are provided for convenience and customs purposes, the written description of the scope of this Order is dispositive.

    Tolling of Deadline of Preliminary Results of Review

    As explained in the memorandum from the Acting Assistant Secretary for Enforcement and Compliance, the Department has exercised its discretion to toll all administrative deadlines due to the recent closure of the Federal Government. All deadlines in this segment of the proceeding have been extended by four business days.6

    6See Memorandum for the Record from Ron Lorentzen, Acting Assistant Secretary for Enforcement and Compliance, “Tolling of Administrative Deadlines as a Result of the Government Closure during Snowstorm `Jonas,'” dated January 27, 2016.

    Rescission of Administrative Review in Part

    Pursuant to 19 CFR 351.213(d)(1), based on timely withdrawal of the requests for review, we are partially rescinding this administrative review with respect to 129 companies named in the Initiation Notice. 7 See Appendix II for a full list of these companies.8

    7See Initiation Notice, 80 FR at 37590-37593.

    8See also the Preliminary Decision Memorandum for further details.

    Separate Rates

    In the Initiation Notice, we informed parties of the opportunity to request a separate rate.9 In proceedings involving non-market economy (NME) countries, the Department begins with a rebuttable presumption that all companies within the NME country are subject to government control and, thus, should be assigned a single weighted-average dumping margin. It is the Department's policy to assign all exporters of merchandise subject to an administrative review involving an NME country this single rate unless an exporter can demonstrate that it is sufficiently independent so as to be entitled to a separate rate. Companies that wanted to be considered for a separate rate in this review were required to timely file a separate-rate application or a separate-rate certification to demonstrate their eligibility for a separate rate. Separate-rate applications and separate-rate certifications were due to the Department within 30 calendar days of the publication of the Initiation Notice.

    9Id., 80 FR at 37589-37590.

    In this review, 21 companies for which a review was requested and which remain under review did not submit separate-rate information to rebut the presumption that they are subject to government control.10 These companies are: Belton (Asia) Development Ltd.; Classic & Contemporary Inc.; Danfoss Micro Channel Heat Exchanger (Jia Xing) Co., Ltd.; Dongguan Golden Tiger Hardware Industrial Co., Ltd.; Ever Extend Ent. Ltd.; Fenghua Metal Product Factory; FookShing Metal & Plastic Co. Ltd.; Foshan Golden Source Aluminum Products Co., Ltd.; Global Point Technology (Far East) Limited; Gold Mountain International Development Limited; Golden Dragon Precise Copper Tube Group, Inc.; Hebei Xusen Wire Mesh Products Co., Ltd.; Jackson Travel Products Co., Ltd.; New Zhongya Aluminum Factory; Shanghai Automobile Air-Conditioner Accessories Co., Ltd.; Southwest Aluminum (Group) Co., Ltd.; Suzhou NewHongJi Precision Part Co., Ltd.; Union Aluminum (SIP) Co.; Whirlpool Canada L.P.; Whirlpool Microwave Products Development Ltd.; and Xin Wei Aluminum Co. As further discussed in the Preliminary Decision Memorandum,11 we preliminarily determine that these entities have not demonstrated that they operate free from government control and thus are not eligible for a separate rate.

    10 One company, Zhaoqing New Zhongya Aluminum Co., Ltd. (New Zhongya), was determined to have been succeeded by Guangdong Zhongya Aluminum Company Limited (Guangdong Zhongya) in a changed circumstances review. See Aluminum Extrusions From the People's Republic of China: Final Results of Changed Circumstances Review, 77 FR 54900 (September 6, 2012). Thus, despite the fact that a review was initiated of New Zhongya, it is not being included among these 21 companies because its successor in interest, Guangdong Zhongya, is part of the Guang Ya Group/Zhongya/Xinya single entity.

    11See Memorandum from Christian Marsh, Deputy Assistant Secretary for Antidumping and Countervailing Duty Operations, to Paul Piquado, Assistant Secretary for Enforcement and Compliance, “Decision Memorandum for Preliminary Results of Antidumping Duty Administrative Review: Aluminum Extrusions from the People's Republic of China; 2014-2015,” dated concurrently with this notice.

    Two additional companies that remain under review, Atlas Integrated Manufacturing Ltd. (Atlas) and Genimex Shanghai, Ltd. (Genimex), submitted separate-rate applications, but, as further discussed in the Preliminary Decision Memorandum, we preliminarily determine that these companies are not eligible for a separate rate.

    In addition, nine companies still under review submitted separate-rate applications or separate-rate certifications and, where applicable, responses to supplemental questionnaires which provide sufficient information to preliminarily determine that they are entitled to a separate rate. These nine companies are: Allied Maker Limited; Birchwoods (Lin'an) Leisure Products Co., Ltd.; Changzhou Changzheng Evaporator Co., Ltd.; Dongguan Aoda Aluminum Co., Ltd.; JMA (HK) Company Limited; Kam Kiu Aluminium Products Sdn. Bhd.; Metaltek Group Co., Ltd.; Taishan City Kam Kiu Aluminium Extrusion Co., Ltd.; and Tianjin Jinmao Import & Export Corp., Ltd. A full discussion of the basis for granting these companies a separate rate can be found in the Preliminary Decision Memorandum.

    Rate for Non-Examined Companies Which Are Eligible for a Separate Rate

    The statute and the Department's regulations do not address the establishment of the rate applied to individual respondents not selected for individual examination when the Department limits its examination in an administrative review pursuant to section 777A(c)(2) of the Act. Generally, the Department looks to section 735(c)(5) of the Act, which provides instructions for calculating the all-others rate in an investigation, for guidance when calculating the rate for separate-rate respondents which we did not examine individually in an administrative review. Section 735(c)(5)(A) of the Act notes a preference that we are not to calculate an all-others rate using rates for individually-examined respondents which are zero, de minimis, or based entirely on facts available. Section 735(c)(5)(B) of the Act provides that, where all rates are zero, de minimis, or based entirely on facts available, the Department may use “any reasonable method” for assigning a rate to non-examined respondents.

    In previous cases, the Department has determined that a reasonable method to use when the rates for respondents selected for individual examination are zero, de minimis, or based entirely on facts available is to assign non-examined respondents the average of the most recently-determined weighted-average dumping margins that are not zero, de minimis, or based entirely on facts available.12 These rates may be from the investigation, a prior administrative review, or a new shipper review.

    12See Narrow Woven Ribbons With Woven Selvedge from Taiwan; Final Results of Antidumping Duty Administrative Review; 2013-2014, 81 FR 22578 (April 18, 2016) and accompanying Issues and Decision Memorandum at Comment 1; see also Ball Bearings and Parts Thereof From France, Germany, Italy, Japan, and the United Kingdom: Final Results of Antidumping Duty Administrative Reviews and Rescission of Reviews in Part, 73 FR 52823, 52824 (September 11, 2008) and accompanying Issues and Decision Memorandum at Comment 16.

    For these preliminary results, the rates we determined for the mandatory respondents were either zero, de minimis, or based entirely on facts available. Therefore, we preliminarily determine to apply a margin (that is not zero, de minimis, or based entirely on facts available) from the most recently-completed segment in this proceeding to the non-examined separate-rate companies. This determination is consistent with precedent 13 and the most reasonable method to determine the separate rate in the instant review. Pursuant to this method, we are preliminarily assigning the margin of 86.01 percent, the sole margin calculated in the immediately-preceding segment of this proceeding for the mandatory respondent and applied to the non-examined separate-rate respondents,14 to the non-examined separate-rate respondents in the instant review.

    13Id. This is also consistent with the Department's determination in prior segments of this proceeding. See 2010-2012 Final Results, 79 FR at 99 and 2012-2013 Final Results, 79 FR at 78786. See also Yangzhou Bestpak Gifts & Crafts Co., Ltd. v. United States, 716 F.3d 1370, 1374 (Fed. Cir. 2013) (recognizing and affirmatively discussing the Department's normal methodology for calculating a separate rate).

    14See 2013-2014 Final Results, 80 FR at 75063.

    15See Letter from Xin Wei to the Department, “Aluminum Extrusions from the People's Republic of China: Certification of No Sales, Shipments, or Entries,” dated July 22, 2015 and Letter from Permasteelisa Hong Kong Limited and Permasteelisa South China Factory, “Aluminum Extrusions From the People's Republic of China: Notice of No Sales,” dated July 28, 2015. While the Department issued standard no-shipment port inquiries for Xin Wei and Permasteelisa Hong Kong Limited, we did not do so with regard to Permasteelisa South China Factory because Permasteelisa South China Factory was not granted separate rate status in a prior segment of this proceeding. See, e.g., 2013-2014 Final Results, 80 FR at 75063, footnote 30.

    Preliminary Determination of No Shipments

    Two companies for which a review was requested and remain under review, Xin Wei and Permasteelisa Hong Kong Limited, timely submitted certifications indicating that they had no exports, sales, shipments, or entries of subject merchandise during the POR.15 Consistent with our practice, the Department requested that CBP conduct a query on potential shipments made by Xin Wei and Permasteelisa Hong Kong Limited during the POR; CBP provided no evidence that contradicted either Xin

    Wei's or Permasteelisa Hong Kong Limited's claims of no shipments. Based on Xin Wei's and Permasteelisa Hong Kong Limited's no-shipment certifications and our analysis of the CBP information, we preliminarily determine that neither Xin Wei nor Permasteelisa Hong Kong Limited had shipments during the POR. However, consistent with our practice in NME cases, the Department is not rescinding this review, in part, but intends to complete the review with respect to Xin Wei and Permasteelisa Hong Kong Limited and issue appropriate instructions to CBP based on the final results of the review.16

    16See Non-Market Economy Antidumping Proceedings: Assessment of Antidumping Duties, 76 FR 65694, 65695 (October 24, 2011).

    Application of Adverse Facts Available

    Pursuant to sections 776(a)(1) and 776(a)(2)(A), (B), (C), and (D) of the Act, the Department preliminarily finds that the use of facts otherwise available is warranted with respect to Jangho. On May 5, 2016, Jangho submitted a letter to the Department in which it announced its withdrawal from active participation as a mandatory respondent in the instant administrative review.17 By withdrawing from participation in this proceeding, Jangho withheld necessary information requested by the Department and therefore significantly impeded the proceeding. Furthermore, some of the information Jangho did provide prior to its withdrawal from this proceeding was not in the form and manner requested, and Jangho's withdrawal precludes verification of the information it did provide.

    17See Letter from Jangho to the Department, “2014-2015 Administrative Review of Aluminum Extrusions from the People's Republic of China,” dated May 5, 2016.

    The Department also preliminarily finds that the use of facts otherwise available is warranted with respect to Guang Ya Group/Zhongya/Xinya in accordance with sections 776(a)(2)(A) and (C) of the Act. On November 23, 2015, Zhongya submitted a letter to the Department stating that it would not be responding to the Department's questionnaires.18 In addition, on November 25, 2015, Guang Ya Group submitted a letter informing the Department that it was withdrawing from participation in this review.19 As a result, Guang Ya Group/Zhongya/Xinya withheld information that was requested by the Department and thus significantly impeded the proceeding.

    18See Letter from Zhongya Aluminum Company Limited, Guangdong Zhongya Aluminium Company Limited, Zhongya Shaped Aluminum (HK) Holding Limited, and Karlton Aluminum Company Ltd. to the Department, “Aluminum Extrusions from China: Antidumping (AD) And Countervailing Duty (CVD) Questionnaires,” dated November 23, 2015.

    19See Letter from Guang Ya Group to the Department, dated November 25, 2015.

    Further, pursuant to section 776(b) of the Act, the Department preliminarily determines that both Jangho and Guang Ya Group/Zhongya/Xinya failed to cooperate by not acting to the best of their abilities to comply with the Department's requests for information, and, thus, an adverse inference is warranted.

    Because the Department preliminarily determines that Jangho and Guang Ya Group/Zhongya/Xinya failed to cooperate by not acting to the best of their abilities to comply with requests for information, we have determined that they are not eligible for a separate rate.20 Regarding Jangho, the Department preliminarily finds that the record contains numerous deficiencies because Jangho did not respond to a supplemental questionnaire issued by the Department; therefore, the record does not contain the information necessary to make a separate rate determination. Guang Ya Group/Zhongya/Xinya, on the other hand, failed to provide a response to the Department's antidumping questionnaire at all. As such, separate rates are not warranted for Jangho or Guang Ya Group/Zhonya/Xinya.

    20See section 776(b) of the Act.

    PRC-Wide Entity

    As the Department preliminarily determines, based on AFA, that Jangho and Guang Ya Group/Zhongya/Xinya are not eligible for a separate rate, we determine that both companies are part of the PRC-wide entity.

    In addition, 21 companies still subject to these preliminary results (listed above) are not eligible for separate-rate status because they did not submit separate-rate applications or certifications. Two additional companies still under review, Atlas and Genimex, submitted separate-rate applications that did not demonstrate eligibility for a separate rate. As a result, the Department preliminarily finds these 23 companies are also part of the PRC-wide entity.

    The Department's change in policy regarding conditional review of the PRC-wide entity applies to this administrative review.21 Under this policy, the PRC-wide entity will not be under review unless a party specifically requests, or the Department self-initiates, a review of the entity. Because no party requested a review of the PRC-wide entity in this review, the entity is not under review and the entity's rate from the previous administrative review (i.e., 33.28 percent) is not subject to change.22

    21See Antidumping Proceedings: Announcement of Change in Department Practice for Respondent Selection in Antidumping Duty Proceedings and Conditional Review of the Nonmarket Economy Entity in NME Antidumping Duty Proceedings, 78 FR 65963, 65970 (November 4, 2013) (Conditional Review of NME Entity Notice).

    22See 2013-2014 Final Results, 80 FR at 75063.

    Methodology

    The Department is conducting this review in accordance with section 751(a)(1)(B) of the Act. For a full description of the methodology underlying our preliminary results, see the Preliminary Decision Memorandum, dated concurrently with these results and hereby adopted by this notice. A list of the topics included in the Preliminary Decision Memorandum is included as an appendix to this notice. The Preliminary Decision Memorandum is a public document and is on file electronically via Enforcement and Compliance's Antidumping and Countervailing Duty Centralized Electronic Service System (ACCESS). ACCESS is available to registered users at http://access.trade.gov and to all parties in the Central Records Unit, Room B8024 of the main Department of Commerce building. In addition, parties can obtain a complete version of the Preliminary Decision Memorandum on the Internet at http://enforcement.trade.gov/frn/index.html. The signed Preliminary Decision Memorandum and the electronic version of the Preliminary Decision Memorandum are identical in content.

    Adjustments for Countervailable Subsidies

    Because no mandatory respondent established eligibility for an adjustment under section 777A(f) of the Act for countervailable domestic subsidies, for these preliminary results, the Department did not make an adjustment pursuant to section 777A(f) of the Act for countervailable domestic subsidies for the separate-rate recipients.

    Pursuant to section 772(c)(1)(C) of the Act, the Department made an adjustment for countervailable export subsidies for the separate-rate recipients. Specifically, we adjusted the assigned separate rate by deducting the simple average of the countervailable export subsidies determined for the individually-examined respondents in the 2013 (i.e., most recently completed) countervailing duty administrative review.23

    23See Aluminum Extrusions From the People's Republic of China: Final Results, and Partial Rescission of Countervailing Duty Administrative Review; 2013, 80 FR 77325 (December 14, 2015) and Aluminum Extrusions From the People's Republic of China: Amended Final Results of Countervailing Duty Administrative Review; 2013, 81 FR 15238 (March 22, 2016), as corrected in Aluminum Extrusions from the People's Republic of China: Notice of Correction to Amended Final Results of Countervailing Duty Administrative Review; 2013, 81 FR 31227 (May 18, 2016). See also Preliminary Decision Memorandum for the calculation of the countervailable export subsidies deducted from the assigned separate rate.

    For the PRC-wide entity, since the entity is not currently under review, its rate is not subject to change.24

    24See Conditional Review of NME Entity Notice, 78 FR at 65970. As the rate for the PRC-wide entity is not subject to change in the instant review, the adjusted margin we are applying to the PRC-wide entity in the instant review, 33.18 percent, is net of the countervailable domestic and export subsidies determined in the 2012-2013 Final Results. See 2012-2013 Final Results, 79 FR at 78787; see also 2013-2014 Final Results, 80 FR at 75063, footnote 27.

    Preliminary Results of Review

    The Department preliminarily determines that the following weighted-average dumping margins exist for the 2014-2015 POR:

    Exporter Weighted-
  • average
  • dumping
  • margin
  • (percent)
  • Margin
  • adjusted for
  • liquidation
  • and cash
  • deposit
  • purposes
  • (percent)
  • Allied Maker Limited 86.01 85.94 Birchwoods (Lin'an) Leisure Products Co., Ltd. 86.01 85.94 Changzhou Changzheng Evaporator Co., Ltd. 86.01 85.94 Dongguan Aoda Aluminum Co., Ltd. 86.01 85.94 JMA (HK) Company Limited 86.01 85.94 Kam Kiu Aluminium Products Sdn Bhd 25 86.01 85.94 Metaltek Group Co., Ltd. 86.01 85.94 Tianjin Jinmao Import & Export Corp., Ltd. 86.01 85.94

    Additionally, the Department preliminarily determines that the following companies are part of the PRC-wide entity: Jangho (which includes Guangzhou Jangho Curtain Wall System Engineering Co., Ltd. and Jangho Curtain Wall Hong Kong Ltd.); Guang Ya Group/Zhongya/Xinya (which includes Guang Ya Aluminium Industries Co., Ltd.; Foshan Guangcheng Aluminium Co., Ltd.; Kong Ah International Company Limited; Guang Ya Aluminium Industries (Hong Kong) Ltd.; Guangdong Zhongya Aluminium Company Limited; Zhongya Shaped Aluminium (HK) Holding Limited; Karlton Aluminum Company Ltd.; and Xinya Aluminum & Stainless Steel Product Co., Ltd.); Atlas Integrated Manufacturing Ltd.; Belton (Asia) Development Ltd.; Classic & Contemporary Inc.; Danfoss Micro Channel Heat Exchanger (Jia Xing) Co., Ltd.; Dongguan Golden Tiger Hardware Industrial Co., Ltd.; Ever Extend Ent. Ltd.; Fenghua Metal Product Factory; FookShing Metal & Plastic Co. Ltd.; Foshan Golden Source Aluminum Products Co., Ltd.; Genimex Shanghai, Ltd.; Global Point Technology (Far East) Limited; Gold Mountain International Development Limited; Golden Dragon Precise Copper Tube Group, Inc.; Hebei Xusen Wire Mesh Products Co., Ltd.; Jackson Travel Products Co., Ltd.; New Zhongya Aluminum Factory; Shanghai Automobile Air-Conditioner Accessories Co., Ltd.; Southwest Aluminum (Group) Co., Ltd.; Suzhou NewHongJi Precision Part Co., Ltd.; Union Aluminum (SIP) Co.; Whirlpool Canada L.P.; Whirlpool Microwave Products Development Ltd.; and Xin Wei Aluminum Co. The rate previously established for the PRC-wide entity in the previous administrative review is 33.28 percent.26

    25 Although the Department initiated a review for both Taishan City Kam Kiu Aluminium Extrusion Co., Ltd. and Kam Kiu Aluminium Products Sdn Bhd, it is apparent from the company's separate-rate application that Kam Kiu Aluminium Products Sdn Bhd is the exporter and Taishan City Kam Kiu Aluminium Extrusion Co., Ltd. is a producer only; thus, Kam Kiu Aluminium Products Sdn Bhd is the appropriate party to grant the separate rate status.

    26See 2013-2014 Final Results, 80 FR at 75063.

    Public Comment

    Interested parties may submit case briefs no later than 30 days after the date of publication of these preliminary results of review.27 Rebuttal briefs, limited to issues raised in the case briefs, may be filed no later than five days after the case briefs are filed.28 Parties who submit arguments are requested to submit with the argument (a) a statement of the issue, (b) a brief summary of the argument, and (c) a table of authorities.29 Parties submitting briefs should do so pursuant to the Department's electronic filing requirements.

    27See 19 CFR 351.309(c)(1)(ii).

    28See 19 CFR 351.309(d)(1)-(2).

    29See 19 CFR 351.309(c)(2) and (d)(2).

    Any interested party may request a hearing within 30 days of publication of this notice.30 Hearing requests should contain the following information: (1) The party's name, address, and telephone number; (2) the number of participants; and (3) a list of the issues to be discussed. Oral presentations will be limited to issues raised in the case and rebuttal briefs. If a request for a hearing is made, parties will be notified of the time and date for the hearing to be held at the U.S. Department of Commerce, 14th Street and Constitution Avenue NW., Washington, DC 20230.31

    30See 19 CFR 351.310(c).

    31See 19 CFR 351.310(d).

    Unless extended, the Department intends to issue the final results of this administrative review, which will include the results of our analysis of all issues raised in the case briefs, within 120 days of publication of these preliminary results in the Federal Register, pursuant to section 751(a)(3)(A) of the Act.

    Assessment Rates

    Upon issuance of the final results of this review, the Department will determine, and CBP shall assess, antidumping duties on all appropriate entries covered by this review.32 The Department intends to issue assessment instructions to CBP 15 days after publication of the final results of this review.

    32See 19 CFR 351.212(b)(1).

    We intend to instruct CBP to liquidate entries containing subject merchandise exported by the PRC-wide entity at the PRC-wide rate. Additionally, if the Department determines that an exporter under review had no shipments of the subject merchandise, any suspended entries that entered under that exporter's case number will be liquidated at the PRC-wide rate.33

    33See Non-Market Economy Antidumping Proceedings: Assessment of Antidumping Duties, 76 FR 65694 (October 24, 2011).

    For the companies for which this review is rescinded, antidumping duties shall be assessed at rates equal to the cash deposit of estimated antidumping duties required at the time of entry, or withdrawal from warehouse, for consumption, in accordance with 19 CFR 351.212(c)(1)(i). We will instruct CBP accordingly.

    Cash Deposit Requirements

    The following cash deposit requirements for estimated antidumping duties, when imposed, will apply to all shipments of subject merchandise from the PRC entered, or withdrawn from warehouse, for consumption on or after the publication of the final results of this administrative review, as provided by section 751(a)(2)(C) of the Act: (1) If the companies preliminarily determined to be eligible for a separate rate receive a separate rate in the final results of this administrative review, their cash deposit rate will be equal to the weighted-average dumping margin established in the final results of this review, as adjusted for domestic and export subsidies (except, if that rate is de minimis, then the cash deposit rate will be zero); (2) for any previously investigated or reviewed PRC and non-PRC exporters that are not under review in this segment of the proceeding but that received a separate rate in the most recently completed segment of this proceeding, the cash deposit rate will continue to be the exporter-specific rate published for the most recently completed segment of this proceeding; (3) for all PRC exporters of subject merchandise that have not been found to be entitled to a separate rate, the cash deposit rate will be that for the PRC-wide entity, which is 33.18 percent; 34 and (4) for all non-PRC exporters of subject merchandise which have not received their own rate, the cash deposit rate will be the rate applicable to the PRC exporter that supplied that non-PRC exporter.

    34See 2012-2013 Final Results, 79 FR at 78787. This rate is adjusted for export and domestic subsidies, as appropriate.

    These cash deposit requirements, when imposed, shall remain in effect until further notice.

    Notification to Importers

    This notice also serves as a preliminary reminder to importers of their responsibility under 19 CFR 351.402(f)(2) to file a certificate regarding the reimbursement of antidumping duties prior to liquidation of the relevant entries during this review period. Failure to comply with this requirement could result in the Department's presumption that reimbursement of antidumping duties occurred and the subsequent assessment of double antidumping duties.

    Notification to Interested Parties

    We are issuing and publishing notice of these preliminary results in accordance with sections 751(a)(1) and 777(i)(1) of the Act and 19 CFR 351.221(b)(4).

    Dated: June 6, 2016. Paul Piquado, Assistant Secretary for Enforcement and Compliance. Appendix I—List of Topics Discussed in the Preliminary Decision Memorandum 1. Summary 2. Background 3. Respondent Selection 4. Rescission of Administrative Review in Part 5. Scope of the Order 6. Affiliation and Collapsing 7. Preliminary Determination of No Shipments 8. Non-Market Economy Country 9. Separate Rates 10. Separate-Rate Recipients 11. Preliminary Determination of Rate for Non-Examined Separate-Rate Recipients 12. The PRC-Wide Entity 13. Application of Facts Available and Use of Adverse Inference 14. Adjustments for Countervailable Subsidies 15. Conclusion Appendix II—Companies for Which This Administrative Review Is Being Rescinded 1. Acro Import and Export Co. 2. Activa International Inc. 3. Alnan Aluminium Co., Ltd. 4. Aluminicaste Fundicion de Mexico 5. Bracalente Metal Products (Suzhou) Co., Ltd. 6. Changshu Changsheng Aluminium Products Co., Ltd. 7. Changzhou Tenglong Auto Parts Co., Ltd. 8. China Zhongwang Holdings, Ltd. 9. Chiping One Stop Industrial & Trade Co., Ltd. 10. Clear Sky Inc. 11. Cosco (J.M.) Aluminium Co., Ltd. 12. Dongguan Dazhan Metal Co., Ltd. 13. Dragonluxe Limited 14. Dynamic Technologies China Ltd. 15. Dynabright Int'l Group (HK) Limited 16. First Union Property Limited 17. Foreign Trade Co. of Suzhou New & High-Tech Industrial Development Zone 18. Foshan City Nanhai Hongjia Aluminum Alloy Co., Ltd. 19. Foshan Jinlan Aluminum Co., Ltd. 20. Foshan JMA Aluminum Company Limited 21. Foshan Sanshui Fenglu Aluminium Co., Ltd. 22. Foshan Shunde Aoneng Electrical Appliances Co., Ltd. 23. Foshan Yong Li Jian Aluminum Co., Ltd. 24. Fujian Sanchuan Aluminum Co., Ltd. 25. Global PMX Dongguan Co., Ltd. 26. Gran Cabrio Capital Pte. Ltd. 27. Gree Electric Appliances 28. GT88 Capital Pte. Ltd. 29. Guangdong Hao Mei Aluminium Co., Ltd. 30. Guangdong Jianmei Aluminum Profile Company Limited 31. Guangdong JMA Aluminum Profile Factory (Group) Co., Ltd. 32. Guangdong Nanhai Foodstuffs Imp. & Exp. Co., Ltd. 33. Guangdong Weiye Aluminum Factory Co., Ltd. 34. Guangdong Whirlpool Electrical Appliances Co., Ltd. 35. Guangdong Xingfa Aluminium Co., Ltd. 36. Guangdong Xin Wei Aluminum Products Co., Ltd. 37. Guangdong Yonglijian Aluminum Co., Ltd. 38. Guangzhou Mingcan Die-Casting Hardware Products Co., Ltd. 39. Hangzhou Xingyi Metal Products Co., Ltd. 40. Hanwood Enterprises Limited 41. Hanyung Alcoba Co., Ltd. 42. Hanyung Alcobis Co., Ltd. 43. Hanyung Metal (Suzhou) Co., Ltd. 44. Hao Mei Aluminum Co., Ltd. 45. Hao Mei Aluminum International Co., Ltd. 46. Henan New Kelong Electrical Appliances Co., Ltd. 47. Hong Kong Gree Electric Appliances Sales Limited 48. Honsense Development Company 49. Hui Mei Gao Aluminum Foshan Co., Ltd. 50. IDEX Dinglee Technology (Tianjin) Co., Ltd. 51. IDEX Technology Suzhou Co., Ltd. 52. IDEX Health 53. Innovative Aluminium (Hong Kong) Limited 54. iSource Asia 55. Jiangmen Qunxing Hardware Diecasting Co., Ltd. 56. Jiangsu Changfa Refrigeration Co., Ltd. 57. Jiangyin Trust International Inc. 58. Jiangyin Xinhong Doors and Windows Co., Ltd. 59. Jiaxing Jackson Travel Products Co., Ltd. 60. Jiaxing Taixin Metal Products Co., Ltd. 61. Jiuyan Co., Ltd. 62. Justhere Co., Ltd. 63. Kanal Precision Aluminum Product Co., Ltd. 64. Kromet International, Inc. 65. Kunshan Giant Light Metal Technology Co., Ltd. 66. Liaoning Zhongwang Group Co., Ltd. 67. Liaoyang Zhongwang Aluminum Profile Co., Ltd. 68. Longkou Donghai Trade Co., Ltd. 69. Metaltek Metal Industry Co., Ltd. 70. Midea Air Conditioning Equipment Co., Ltd. 71. Midea International Training Co., Ltd./Midea International Trading Co., Ltd. 72. Miland Luck Limited 73. Nanhai Textiles Import & Export Co., Ltd. 74. New Asia Aluminum & Stainless Steel Product Co., Ltd. 75. Nidec Sankyo (Zhejang) Corporation 76. Nidec Sankyo Singapore Pte. Ltd. 77. Ningbo Coaster International Co., Ltd. 78. Ningbo Hi Tech Reliable Manufacturing Company 79. Ningbo Ivy Daily Commodity Co., Ltd. 80. Ningbo Yili Import and Export Co., Ltd. 81. North China Aluminum Co., Ltd. 82. North Fenghua Aluminum Ltd. 83. Northern States Metals 84. PanAsia Aluminium (China) Limited 85. Pengcheng Aluminum Enterprise Inc. 86. Pingguo Aluminum Company Limited 87. Pingguo Asia Aluminum Co., Ltd. 88. Popular Plastics Co., Ltd. 89. Press Metal International Ltd. 90. Samuel, Son & Co., Ltd. 91. Sanchuan Aluminum Co., Ltd. 92. Shangdong Huasheng Pesticide Machinery Co. 93. Shangdong Nanshan Aluminum Co., Ltd. 94. Shanghai Canghai Aluminum Tube Packaging Co., Ltd. 95. Shanghai Dongsheng Metal 96. Shanghai Shen Hang Imp & Exp Co., Ltd. 97. Shanghai Tongtai Precise Aluminum Alloy Manufacturing Co., Ltd. 98. Shenyang Yuanda Aluminium Industry Engineering Co., Ltd. 99. Shenzhen Hudson Technology Development Co. 100. Shenzhen Jiuyuan Co., Ltd. 101. Sihui Shi Guo Yao Aluminum Co., Ltd. 102. Sincere Profit Limited 103. Skyline Exhibit Systems (Shanghai) Co., Ltd. 104. Suzhou JRP Import & Export Co., Ltd. 105. TAI-AO Aluminium (Taishan) Co., Ltd. 106. Taizhou Lifeng Manufacturing Co., Ltd. 107. Taizhou United Imp. & Exp. Co., Ltd. 108. tenKsolar (Shanghai) Co., Ltd. 109. Tianjin Ganglv Nonferrous Metal Materials Co., Ltd. 110. Tianjin Ruixin Electric Heat Transmission Technology, Ltd. 111. Tianjin Xiandai Plastic & Aluminum Products Co., Ltd. 112. Tiazhou Lifeng Manufacturing Corporation/Taizhou Lifeng Manufacturing Corporation, Ltd. 113. Top-Wok Metal Co., Ltd. 114. Traffic Brick Network, LLC 115. Union Industry (Asia) Co., Ltd. 116. USA Worldwide Door Components (PINGHU) Co., Ltd. 117. Wenzhou Shengbo Decoration & Hardware 118. Whirlpool (Guangdong) 119. WTI Building Products, Ltd. 120. Zahoqing China Square Industry Limited/Zhaoqing China Square Industry Limited 121. Zhaoqing Asia Aluminum Factory Company Ltd. 122. Zhaoqing China Square Industrial Ltd. 123. Zhejiang Anji Xinxiang Aluminum Co., Ltd. 124. Zhejiang Yongkang Listar Aluminium Industry Co., Ltd. 125. Zhejiang Zhengte Group Co., Ltd. 126. Zhenjiang Xinlong Group Co., Ltd. 127. Zhongshan Daya Hardware Co., Ltd. 128. Zhongshan Gold Mountain Aluminium Factory Ltd. 129. Zhuhai Runxingtai Electrical Equipment Co., Ltd.
    [FR Doc. 2016-14046 Filed 6-13-16; 8:45 am] BILLING CODE 3510-DS-P
    DEPARTMENT OF COMMERCE International Trade Administration [A-570-832] Pure Magnesium From the People's Republic of China: Final Results of Antidumping Duty Administrative Review; 2014-2015 AGENCY:

    Enforcement and Compliance, International Trade Administration, Department of Commerce.

    SUMMARY:

    On February 8, 2016, the Department of Commerce (“Department”) published in the Federal Register the preliminary results of the administrative review of the antidumping duty order on pure magnesium from the People's Republic of China (“PRC”) covering the period May 1, 2014 through April 31, 2015.1 This review covers one PRC exporter, Tianjin Magnesium International, Co., Ltd. (“TMI”) and Tianjin Magnesium Metal, Co., Ltd. (“TMM”) (collectively “TMI/TMM”). The Department gave interested parties an opportunity to comment on the Preliminary Results, but we received no comments. Hence, these final results are unchanged from the Preliminary Results, and we continue to find that TMI/TMM did not have reviewable entries during the period of review (“POR”).

    1See Pure Magnesium From the People's Republic of China: Preliminary Results of Antidumping Duty Administrative Review; 2014-2015, 81 FR 6504 (February 8, 2016) (“Preliminary Results”).

    DATES:

    Effective Date: June 14, 2016.

    FOR FURTHER INFORMATION CONTACT:

    Shanah Lee or Brendan Quinn, AD/CVD Operations, Office III, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue NW., Washington, DC 20230; telephone: (202) 482-6386 or (202) 482-5848, respectively.

    SUPPLEMENTARY INFORMATION:

    Background

    On February 8, 2016, the Department published the Preliminary Results of the instant review, preliminarily finding that TMI/TMM did not have any reviewable entries during the POR.2 We invited interested parties to comment on the Preliminary Results. 3 We received no comments from interested parties.

    2Id., at 6505-6506.

    3Id., at 6506.

    The Department conducted this review in accordance with section 751(a)(1)(B) of the Tariff Act of 1930, as amended (“the Act”).

    Scope of the Order

    Merchandise covered by the order is pure magnesium regardless of chemistry, form or size, unless expressly excluded from the scope of the order. Pure magnesium is a metal or alloy containing by weight primarily the element magnesium and produced by decomposing raw materials into magnesium metal. Pure primary magnesium is used primarily as a chemical in the aluminum alloying, desulfurization, and chemical reduction industries. In addition, pure magnesium is used as an input in producing magnesium alloy. Pure magnesium encompasses products (including, but not limited to, butt ends, stubs, crowns and crystals) with the following primary magnesium contents:

    (1) Products that contain at least 99.95% primary magnesium, by weight (generally referred to as “ultra pure” magnesium);

    (2) Products that contain less than 99.95% but not less than 99.8% primary magnesium, by weight (generally referred to as “pure” magnesium); and

    (3) Products that contain 50% or greater, but less than 99.8% primary magnesium, by weight, and that do not conform to ASTM specifications for alloy magnesium (generally referred to as “off-specification pure” magnesium).

    “Off-specification pure” magnesium is pure primary magnesium containing magnesium scrap, secondary magnesium, oxidized magnesium or impurities (whether or not intentionally added) that cause the primary magnesium content to fall below 99.8% by weight. It generally does not contain, individually or in combination, 1.5% or more, by weight, of the following alloying elements: Aluminum, manganese, zinc, silicon, thorium, zirconium and rare earths.

    Excluded from the scope of the order are alloy primary magnesium (that meets specifications for alloy magnesium), primary magnesium anodes, granular primary magnesium (including turnings, chips and powder) having a maximum physical dimension (i.e., length or diameter) of one inch or less, secondary magnesium (which has pure primary magnesium content of less than 50% by weight), and remelted magnesium whose pure primary magnesium content is less than 50% by weight.

    Pure magnesium products covered by the order are currently classifiable under Harmonized Tariff Schedule of the United States (“HTSUS”) subheadings 8104.11.00, 8104.19.00, 8104.20.00, 8104.30.00, 8104.90.00, 3824.90.11, 3824.90.19 and 9817.00.90. Although the HTSUS subheadings are provided for convenience and customs purposes, the written description of the scope is dispositive.

    Final Determination of No Shipments

    As explained in the Preliminary Results, the Department found that TMI/TMM did not have reviewable entries during the POR.4 Also in the Preliminary Results, the Department stated that consistent with its refinement to its assessment practice in non-market economy (“NME”) cases, it is appropriate not to rescind the review in this circumstance but, rather, to complete the review with respect to TMI/TMM and to issue appropriate instructions to Customs and Border Protection (“CBP”) based on the final results of the review.5

    4Id., at 6505-6506.

    5See Non-Market Economy Antidumping Proceedings: Assessment of Antidumping Duties, 76 FR 65694 (October 24, 2011) (“Assessment Practice Refinement”) and the “Assessment Rates” section, below.

    After issuing the Preliminary Results, the Department received no comments from interested parties, nor has it received any information that would cause it to revisit its preliminary results. Therefore, for these final results, the Department continues to find that TMI/TMM did not have any reviewable entries during the POR.

    Assessment Rates

    The Department determined, and CBP shall assess, antidumping duties on all appropriate entries of subject merchandise in accordance with the final results of this review.6 The Department intends to issue assessment instructions to CBP 15 days after the date of publication of these final results of review.

    6See 19 CFR 351.212(b).

    Additionally, consistent with the Department's refinement to its assessment practice in NME cases, because the Department determined that TMI/TMM had no shipments of subject merchandise during the POR, any suspended entries that entered under TMI/TMM's antidumping duty case number (i.e., at that exporter's rate) will be liquidated at the PRC-wide rate.7

    7See Assessment Practice Refinement, 76 FR 65694.

    Cash Deposit Requirements

    The following cash deposit requirements will be effective for all shipments of subject merchandise entered, or withdrawn from warehouse, for consumption on or after the publication date of this notice of final results of the administrative review, as provided by section 751(a)(2)(C) of the Act: (1) For TMI/TMM, which claimed no shipments, the cash deposit rate will remain unchanged from the rate assigned to TMI/TMM in the most recently completed review of the company; (2) for previously investigated or reviewed PRC and non-PRC exporters who are not under review in this segment of the proceeding but who have separate rates, the cash deposit rate will continue to be the exporter-specific rate published for the most recent period; (3) for all PRC exporters of subject merchandise that have not been found to be entitled to a separate rate, the cash deposit rate will be the PRC-wide rate of 111.73 percent; 8 and (4) for all non-PRC exporters of subject merchandise which have not received their own rate, the cash deposit rate will be the rate applicable to the PRC exporter(s) that supplied that non-PRC exporter. These deposit requirements, when imposed, shall remain in effect until further notice.

    8See Pure Magnesium From the People's Republic of China: Final Results of the 2008-2009 Antidumping Duty Administrative Review of the Antidumping Duty Order, 75 FR 80791 (December 23, 2010).

    Notification to Importers

    This notice serves as a final reminder to importers of their responsibility under 19 CFR 351.402(f)(2) to file a certificate regarding the reimbursement of antidumping duties prior to liquidation of the relevant entries during this POR. Failure to comply with this requirement could result in the Department's presumption that reimbursement of antidumping duties occurred and the subsequent assessment of double antidumping duties.

    Administrative Protective Order

    This notice also serves as a reminder to parties subject to administrative protective order (“APO”) of their responsibility concerning the disposition of proprietary information disclosed under APO in accordance with 19 CFR 351.305(a)(3). Timely written notification of the return or destruction of APO materials, or conversion to judicial protective order, is hereby requested. Failure to comply with the regulations and terms of an APO is a sanctionable violation.

    We are issuing and publishing these final results and this notice in accordance with sections 751(a)(1) and 777(i) of the Act.

    Dated: June 7, 2016. Paul Piquado, Assistant Secretary for Enforcement and Compliance.
    [FR Doc. 2016-14059 Filed 6-13-16; 8:45 am] BILLING CODE 3510-DS-P
    DEPARTMENT OF COMMERCE International Trade Administration [C-533-864] Countervailing Duty Investigation of Certain Corrosion-Resistant Steel Products From India: Notice of Correction to Final Affirmative Determination; Negative Determination of Critical Circumstances AGENCY:

    Enforcement and Compliance, International Trade Administration, Department of Commerce.

    FOR FURTHER INFORMATION CONTACT:

    Matthew Renkey, AD/CVD Operations, Office V, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue NW., Washington, DC 20230; telephone: (202) 482-2312.

    SUPPLEMENTARY INFORMATION:

    On June 2, 2016, the Department of Commerce (the Department) published the Final Determination on certain corrosion-resistant steel products from India.1 In the Final Determination the Department inadvertently omitted its final analysis of critical circumstances. Pursuant to 19 CFR 351.206(c)(2)(i), the Department preliminarily determined that critical circumstances did not exist 2 and received no comments on this issue. Based on the examination of the shipping data placed on the record by the mandatory respondents after the Preliminary Determination,3 we examined whether the increase in imports was massive by comparing shipments over the period of July 2014 through February 2015, with the period March 2015 through October 2015 for the mandatory respondents.4 Because the Preliminary Determination was published November 6 (the beginning of November), we used data through October in determining critical circumstances for the mandatory respondents. For all other producers and exporters, our critical circumstances determination continues to be based on data through August, the latest month for which GTA data is on the record, and is thus unchanged from the Preliminary Determination. The Department continues to find that critical circumstances do not exist for the mandatory respondents, or for all other producers and exporters.

    1See Countervailing Duty Investigation of Certain Corrosion-Resistant Steel Products from India: Final Affirmative Determination, 81 FR 35323 (June 2, 2016) (Final Determination).

    2See Antidumping and Countervailing Duty Investigations of Corrosion-Resistant Steel Products from India, Italy, the People's Republic of China, the Republic of Korea, and Taiwan: Preliminary Determinations of Critical Circumstances, 80 FR 68504 (November 5, 2015).

    3See Countervailing Duty Investigation of Certain Corrosion-Resistant Steel Products from India: Preliminary Affirmative Determination, 80 FR 68854 (November 6, 2015) (Preliminary Determination).

    4See the November 16, 2015, quantity and value shipment data for October 2015 from the mandatory respondents.

    This correction to the Final Determination is issued and published in accordance with section 777(i)(1) of the Tariff Act of 1930, as amended.

    Dated: June 8, 2016. Paul Piquado, Assistant Secretary for Enforcement and Compliance.
    [FR Doc. 2016-14072 Filed 6-13-16; 8:45 am] BILLING CODE 3510-DS-P
    DEPARTMENT OF COMMERCE International Trade Administration [A-570-952] Narrow Woven Ribbon With Woven Selvedge From the People's Republic of China: Preliminary Results of Administrative Review; 2014-2015 AGENCY:

    Enforcement and Compliance, International Trade Administration, Department of Commerce.

    DATES:

    Effective Date: June 14, 2016.

    SUMMARY:

    The Department of Commerce (“Department”) is conducting an administrative review of the antidumping duty order on narrow woven ribbons with woven selvedge (“woven ribbons”) from the People's Republic of China (“PRC”) for the period of review (“POR”) September 1, 2014, through August 31, 2015. This review covers one PRC company Yama Ribbons Co., Ltd., (“Yama Ribbons”).1 The Department preliminarily finds that Yama Ribbons did not have reviewable transactions during the POR.

    1See Initiation of Antidumping and Countervailing Duty Administrative Reviews, 80 FR 69193 (November 09, 2015) (“Initiation Notice”). The Department determined in the underlying investigation that merchandise produced and exported by Yama Ribbons is excluded from the antidumping duty order. See also Notice of Antidumping Duty Orders: Narrow Woven Ribbons With Woven Selvedge from Taiwan and the People's Republic of China: Antidumping Duty Orders, 75 FR 53632 (September 1, 2010), as amended in Narrow Woven Ribbons With Woven Selvedge from Taiwan and the People's Republic of China: Amended Antidumping Duty Orders, 75 FR 56982 (September 17, 2010) (“Order”). However, merchandise which Yama exports but did not produce remains subject to the antidumping duty order on narrow woven ribbons with woven selvedge.

    FOR FURTHER INFORMATION CONTACT:

    Aleksandras Nakutis, AD/CVD Operations, Office IV, Enforcement & Compliance, International Trade Administration, U.S. Department of Commerce, 14th Street and Constitution Avenue NW., Washington, DC 20230; telephone: (202) 482-3147.

    SUPPLEMENTARY INFORMATION:

    Scope of the Order

    The products covered by the order are narrow woven ribbons with woven selvedge. The merchandise subject to the order is classifiable under the Harmonized Tariff Schedule of the United States (“HTSUS”) subheadings 5806.32.1020; 5806.32.1030; 5806.32.1050 and 5806.32.1060. Subject merchandise also may enter under HTSUS subheadings 5806.31.00; 5806.32.20; 5806.39.20; 5806.39.30; 5808.90.00; 5810.91.00; 5810.99.90; 5903.90.10; 5903.90.25; 5907.00.60; and 5907.00.80 and under statistical categories 5806.32.1080; 5810.92.9080; 5903.90.3090; and 6307.90.9889. Although the HTSUS subheadings are provided for convenience and customs purposes, the written product description in the Order remains dispositive.2

    2 For a complete description of the scope of the order, please see “Decision Memorandum for Preliminary Results of Antidumping Duty Administrative Review: Narrow Woven Ribbons With Woven Selvedge from the People's Republic of China,” from Christian Marsh, Deputy Assistant Secretary for Antidumping and Countervailing Duty Operations, to Paul Piquado, Assistant Secretary for Enforcement and Compliance (“Preliminary Decision Memorandum”), dated concurrently with this notice.

    Methodology

    The Department is conducting this review in accordance with section 751(a)(1)(B) of the Tariff Act of 1930, as amended (“the Act”). For a full description of the methodology underlying our conclusions, see Preliminary Results Decision Memorandum. This memorandum is a public document and is on file electronically via Enforcement and Compliance's Antidumping and Countervailing Duty Centralized Electronic Service System (“ACCESS”). ACCESS is available to registered users at http://access.trade.gov and in the Central Records Unit, Room B8024 of the main Department of Commerce building. In addition, a complete version of the Preliminary Results Decision Memorandum can be accessed directly on the Internet at http://enforcement.trade.gov/frn/index.html. The signed Preliminary Results Decision Memorandum and the electronic versions of the Preliminary Results Decision Memorandum are identical in content.

    Preliminary Results of Review

    The Department preliminarily determines that Yama Ribbons did not have reviewable transactions during the POR.

    Disclosure and Public Comment

    Interested parties are invited to comment on the preliminary results and may submit case briefs and/or written comments, filed electronically using ACCESS, within 30 days of the date of publication of this notice, pursuant to 19 CFR 351.309(c)(1)(ii). Rebuttal briefs, limited to issues raised in the case briefs, will be due five days after the due date for case briefs, pursuant to 19 CFR 351.309(d). Parties who submit case or rebuttal briefs in this proceeding are requested to submit with each argument a statement of the issue, a summary of the argument not to exceed five pages, and a table of statutes, regulations, and cases cited, in accordance with 19 CFR 351.309(c)(2).

    Pursuant to 19 CFR 351.310(c), interested parties, who wish to request a hearing, or to participate in a hearing if one is requested, must submit a written request to the Assistant Secretary for Enforcement and Compliance, U.S. Department of Commerce, filed electronically using ACCESS. Electronically filed case briefs/written comments and hearing requests must be received successfully in their entirety by the Department's electronic records system, ACCESS, by 5:00 p.m. Eastern Standard Time, within 30 days after the date of publication of this notice.3 Hearing requests should contain: (1) The party's name, address and telephone number; (2) the number of participants; and (3) a list of issues to be discussed. Issues raised in the hearing will be limited to those issues raised in the respective case briefs. If a request for a hearing is made, parties will be notified of the time and date of the hearing which will be held at the U.S. Department of Commerce, 1401 Constitution Avenue NW., Washington, DC 20230. The Department intends to issue the final results of this administrative review, including the results of its analysis of the issues raised in any written briefs, not later than 120 days after the date of publication of this notice, pursuant to section 751(a)(3)(A) of the Act.

    3See 19 CFR 351.310(c).

    Assessment Rates

    Upon issuance of the final results, the Department will determine, and U.S. Customs and Border Protection (“CBP”) shall assess, antidumping duties on all appropriate entries covered by this review.4 The Department intends to issue assessment instructions to CBP 15 days after the publication date of the final results of this review. Pursuant to the Department's practice in NME cases, if we continue to determine that Yama Ribbons had no shipments of the subject merchandise, any suspended entries that entered under that exporter's case number (i.e., at that exporter's rate) will be liquidated at the PRC-wide rate of 247.26 percent. For a full discussion of this practice, see Non-Market Economy Antidumping Proceedings: Assessment of Antidumping Duties, 76 FR 65694 (October 24, 2011).

    4See 19 CFR 351.212(b)(1).

    Cash Deposit Requirements

    The following cash deposit requirements will be effective upon publication of the final results of this administrative review for all shipments of the subject merchandise entered, or withdrawn from warehouse, for consumption on or after the publication date of the final results of review, as provided by section 751(a)(2)(C) of the Act: (1) For exports of merchandise made by Yama Ribbons of merchandise it did not produce, the cash deposit rate is the PRC-wide rate of 247.26 percent, as stated in the Order; 5 (2) for previously investigated or reviewed PRC and non-PRC exporters which are not under review in this segment of the proceeding but which have separate rates, the cash deposit rate will continue to be the exporter-specific rate published for the most recent period; (3) for all PRC exporters of subject merchandise that have not been found to be entitled to a separate rate the cash deposit rate will be the PRC-wide rate of 247.26 percent; and (4) for all non-PRC exporters of subject merchandise which have not received their own rate, the cash deposit rate will be the rate applicable to the PRC exporter(s) that supplied that non-PRC exporter. These deposit requirements, when imposed, shall remain in effect until further notice.

    5See Order at 75 FR 53632.

    Notification to Importers

    This notice also serves as a preliminary reminder to importers of their responsibility under 19 CFR 351.402(f)(2) to file a certificate regarding the reimbursement of antidumping duties prior to liquidation of the relevant entries during this review period. Failure to comply with this requirement could result in the Department's presumption that reimbursement of antidumping duties occurred and the subsequent assessment of double antidumping duties. We are issuing and publishing these results in accordance with sections 751(a)(1) and 777(i)(1) of the Act and 19 CFR 351.213.

    Dated: June 7, 2016. Paul Piquado, Assistant Secretary for Enforcement and Compliance. Appendix—List of Topics Discussed in the Preliminary Results Decision Memorandum Summary Background Scope of the Order Discussion of the Methodology Preliminary Determination of No Shipments Recommendation
    [FR Doc. 2016-14048 Filed 6-13-16; 8:45 am] BILLING CODE 3510-DS-P
    DEPARTMENT OF COMMERCE International Trade Administration [A-570-900] Diamond Sawblades and Parts Thereof From the People's Republic of China: Final Results of Antidumping Duty Administrative Review; 2013-2014 AGENCY:

    Enforcement and Compliance, International Trade Administration, Department of Commerce.

    SUMMARY:

    On December 4, 2015, the Department of Commerce (the Department) published the preliminary results of the administrative review of the antidumping duty order on diamond sawblades and parts thereof (diamond sawblades) from the People's Republic of China (the PRC). The period of review (POR) is November 1, 2013, through October 31, 2014. For the final results, we continue to find that certain companies covered by this review made sales of subject merchandise at less than normal value.

    DATES:

    Effective Date: June 14, 2016

    FOR FURTHER INFORMATION CONTACT:

    Yang Jin Chun or Bryan Hansen, AD/CVD Operations, Office I, Enforcement and Compliance, International Trade Administration, U.S. Department of Commerce, 1401 Constitution Avenue NW., Washington, DC 20230; telephone: (202) 482-5760 and (202) 482-3683, respectively.

    SUPPLEMENTARY INFORMATION: Background

    On December 4, 2015, the Department published the preliminary results of the administrative review of the antidumping duty order on diamond sawblades from the PRC.1 We received case and rebuttal briefs with respect to the Preliminary Results. As explained in the memorandum from the Acting Assistant Secretary for Enforcement and Compliance, the Department exercised its discretion to toll all administrative deadlines due to a closure of the Federal Government. All deadlines in this segment of the proceeding have been extended by four business days. The revised deadline for the final results of this review moved to April 8, 2016.2 Subsequently, we fully extended the time for completing the final results of this administrative review to June 7, 2016.3 At the request of interested parties, we held a hearing on April 20, 2016. We conducted this administrative review in accordance with section 751 of the Tariff Act of 1930, as amended (the Act).

    1See Diamond Sawblades and Parts Thereof From the People's Republic of China: Preliminary Results of Antidumping Duty Administrative Review; 2013-2014, 80 FR 75854 (December 4, 2015) (Preliminary Results), and accompanying Preliminary Decision Memorandum.

    2See Memorandum for the Record from Acting Assistant Secretary Ron Lorenzen entitled “Tolling of Administrative Deadlines as a Result of the Government Closure during Snowstorm `Jonas'” dated January 27, 2016.

    3See Memorandum to Associate Deputy Assistant Secretary Gary Taverman entitled “Diamond Sawblades and Parts Thereof from the People's Republic of China: Extension of Deadline for Final Results of Antidumping Duty Administrative Review” dated March 23, 2016, and Memorandum to Deputy Assistant Secretary Christian Marsh entitled “Diamond Sawblades and Parts Thereof from the People's Republic of China: Full Extension of Deadline for Final Results of Antidumping Duty Administrative Review” dated May 18, 2016.

    Scope of the Order

    The merchandise subject to the order is diamond sawblades. The diamond sawblades subject to the order are currently classifiable under subheadings 8202 to 8206 of the Harmonized Tariff Schedule of the United States (HTSUS), and may also enter under 6804.21.00. The HTSUS subheadings are provided for convenience and customs purposes. A full description of the scope of the order is contained in the Issues and Decision Memorandum.4 The written description is dispositive.

    4See Memorandum from Deputy Assistant Secretary Christian Marsh to Assistant Secretary Paul Piquado entitled “Issues and Decision Memorandum for the Administrative Review of the Antidumping Duty Order on Diamond Sawblades and Parts Thereof from the People's Republic of China” dated June 7, 2016, (Issues and Decision Memorandum) and hereby adopted by this notice, at 4-5.

    Analysis of Comments Received

    All issues raised in the case and rebuttal briefs by parties to this administrative review are addressed in the Issues and Decision Memorandum. A list of the issues raised is attached to this notice as an appendix. The Issues and Decision Memorandum is a public document and is on file electronically via Enforcement and Compliance's Antidumping and Countervailing Duty Centralized Electronic Service System (ACCESS). Access to ACCESS is available to registered users at http://access.trade.gov. The Issues and Decision Memorandum is also available to all parties in the Central Records Unit, Room B8024 of the main Department of Commerce building. In addition, a complete version of the Issues and Decision Memorandum can be accessed directly on the Enforcement and Compliance Web site at http://enforcement.trade.gov/frn/index.html.

    Final Determination of No Shipments

    We preliminarily found that Danyang City Ou Di Ma Tools Co., Ltd., Danyang Tsunda Diamond Tools Co., Ltd., Hangzhou Kingburg Import & Export Co., Ltd., Qingdao Hyosung Diamond Tools Co., Ltd., Qingdao Shinhan Diamond Industrial Co., Ltd., and Shanghai Starcraft Tools Co., Ltd., which have been eligible for separate rates in previous segments of the proceeding and are subject to this review, did not have any reviewable entries of subject merchandise during the POR.5 After the Preliminary Results, we received no comments or additional information with respect to these six companies. Therefore, for the final results, we continue to find that these six companies did not have any reviewable entries of subject merchandise during the POR. Consistent with our practice, we will issue appropriate instructions to U.S. Customs and Border Protection (CBP) based on our final results.

    5See Preliminary Results, and accompanying Preliminary Decision Memorandum at 3-4.

    Final Affiliation and Single Entity Determination

    For the final results, we continue to find that Jiangsu Fengtai Diamond Tool Manufacture Co., Ltd., Jiangsu Fengtai Tools Co., Ltd., and Jiangsu Sawing Co., Ltd., are affiliated, pursuant to sections 771(33)(A) and (F) of the Act. Additionally, under 19 CFR 351.401(f)(1)-(2), we continue to find that these companies should be considered a single entity (collectively known as the Jiangsu Fengtai Single Entity).6

    6See Preliminary Results, and accompanying Preliminary Decision Memorandum at 4-6 for more details.

    Changes Since the Preliminary Results

    Based on our analysis of comments received, we made revisions that have changed the results for certain companies, including the valuation of certain factors of production and the PRC-wide rate. Additionally, we made calculation programming changes for the final results. For further details on the changes we made for these final results, see the company-specific analysis memoranda, the Issues and Decision Memorandum, and the final surrogate value memorandum, dated concurrently with this notice. Moreover, on May 11, 2016, in Diamond Sawblades Manufacturers' Coalition v. United States, Court No. 13-00168, the Court of International Trade affirmed a remand redetermination in which the Department determined it appropriate to reinstate the antidumping duty order on diamond sawblades from the PRC, in part, with respect to certain parts of the ATM Single Entity for which the Department previously had revoked the order, in part.7 Accordingly, the Department reinstated the order on diamond sawblades from the PRC, in part, with respect to these companies.8 As a result, all companies that the Department has found to constitute the ATM Single Entity are subject to this administrative review.9

    7 The ATM Single Entity is comprised of Advanced Technology & Materials Co., Ltd., AT&M International Trading Co., Ltd., Beijing Gang Yan Diamond Products Co., Cliff International Ltd., and HXF Saw Co., Ltd. Concerning partial revocation of the antidumping duty order on diamond sawblades from the PRC, see Certain Frozen Warmwater Shrimp From the People's Republic of China and Diamond Sawblades and Parts Thereof From the People's Republic of China: Notice of Implementation of Determinations Under Section 129 of the Uruguay Round Agreements Act and Partial Revocation of the Antidumping Duty Orders, 78 FR 18958 (March 28, 2013); Diamond Sawblades Manufacturer's Coalition v. United States, Consol. Court No. 13-00168, Slip Op. 16-48 (CIT May 11, 2016).

    8See Diamond Sawblades And Parts Thereof from the People's Republic of China: Notice of Court Decision Not in Harmony With Final Determination Under Section 129 of the Uruguay Round Agreements Act and Reinstatement of Order, In Part, 81 FR 36519 (June 7, 2016).

    9Id. To the extent they do not demonstrate eligibility for a separate rate and no party has requested a review of the PRC-wide entity, there is no conditional review of the PRC-wide entity. See Antidumping Proceedings: Announcement of Change in Department Practice for Respondent Selection in Antidumping Duty Proceedings and Conditional Review of the Nonmarket Economy Entity in NME Antidumping Duty Proceedings, 78 FR 65963 (November 4, 2013), and Preliminary Results, 80 FR at 75854.

    Final Results of the Review

    As a result of this administrative review, we determine that the following weighted-average dumping margins exist for the period November 1, 2013, through October 31, 2014:

    Company Margin
  • (percent)
  • Bosun Tools Co., Ltd 29.76 Chengdu Huifeng Diamond Tools Co., Ltd 29.76 Danyang Huachang Diamond Tools Manufacturing Co., Ltd 29.76 Danyang NYCL Tools Manufacturing Co., Ltd 29.76 Danyang Weiwang Tools Manufacturing Co., Ltd 29.76 Guilin Tebon Superhard Material Co., Ltd 29.76 Hangzhou Deer King Industrial and Trading Co., Ltd 29.76 Hong Kong Hao Xin International Group Limited 29.76 Huzhou Gu's Import & Export Co., Ltd 29.76 Jiangsu Fengtai Single Entity 10 61.48 Jiangsu Huachang Tools Manufacturing Co., Ltd 29.76 Jiangsu Inter-China Group Corporation 11 29.76 Jiangsu Youhe Tool Manufacturer Co., Ltd 29.76 Orient Gain International Limited 29.76 Pantos Logistics (HK) Company Limited 29.76 Qingyuan Shangtai Diamond Tools Co., Ltd 29.76 Quanzhou Zhongzhi Diamond Tool Co., Ltd 29.76 Rizhao Hein Saw Co., Ltd 29.76 Saint-Gobain Abrasives (Shanghai) Co., Ltd 29.76 Shanghai Jingquan Industrial Trade Co., Ltd 29.76 Weihai Xiangguang Mechanical Industrial Co., Ltd 21.67 Wuhan Wanbang Laser Diamond Tools Co 29.76 Xiamen ZL Diamond Technology Co., Ltd 29.76 Zhejiang Wanli Tools Group Co., Ltd 29.76
    Assessment

    Pursuant to section 751(a)(2)(A) of the Act and 19 CFR 351.212(b), the Department shall determine, and CBP shall assess, antidumping duties on all appropriate entries covered by this review.12 For customers or importers of the Jiangsu Fengtai Single Entity and Weihai Xiangguang Mechanical Industrial Co., Ltd. (Weihai) for which we do not have entered values, we calculated customer-/importer-specific antidumping duty assessment amounts based on the ratio of the total amount of dumping duties calculated for the examined sales of subject merchandise to the total sales quantity of those same sales.13 For a customer or importer of Weihai for which we received entered-value information, we have calculated a customer/importer-specific antidumping duty assessment rate based on customer-/importer-specific ad valorem rates in accordance with 19 CFR 351.212(b)(1).

    10 For the final results, we continue to treat Jiangsu Fengtai Diamond Tool Manufacture Co., Ltd., Jiangsu Fengtai Tools Co., Ltd., and Jiangsu Sawing Co., Ltd., as a single entity. See Preliminary Results, 80 FR at 75854-55, and accompanying Preliminary Decision Memorandum at 4-6 for details.

    11See Preliminary Results, 80 FR at 75855 n.15 for the name variation of this company.

    12See 19 CFR 351.212(b)(1).

    13Id.

    For all non-selected respondents that received a separate rate, we will instruct CBP to apply an antidumping duty assessment rate of 29.76 percent 14 to all entries of subject merchandise that entered the United States during the POR. For all other companies, with the exception of the ATM Single Entity, we will instruct CBP to apply the antidumping duty assessment rate of the PRC-wide entity, 82.05 percent, to all entries of subject merchandise exported by these companies.15

    14See Issues and Decision Memorandum at 5-6.

    15See Initiation Notice, 79 FR at 76957 (“All firms listed below that wish to qualify for separate rate status in the administrative reviews involving NME countries must complete, as appropriate, either a separate rate application or certification, as described below.”). Companies that are subject to this administrative review that are considered to be part of the PRC-wide entity are Central Iron and Steel Research Institute Group, China Iron and Steel Research Institute Group, Danyang Aurui Hardware Products Co., Ltd., Danyang Dida Diamond Tools Manufacturing Co., Ltd., Electrolux Construction Products (Xiamen) Co., Ltd., Fujian Quanzhou Wanlong Stone Co., Ltd., Hebei Jikai Industrial Group Co., Ltd., Huachang Diamond Tools Manufacturing Co., Ltd., Hua Da Superabrasive Tools Technology Co., Ltd., Jiangsu Fengyu Tools Co., Ltd., Jiangyin Likn Industry Co., Ltd., Protech Diamond Tools, Pujiang Talent Diamond Tools Co., Ltd., Quanzhou Shuangyang Diamond Tools Co., Ltd., Shanghai Deda Industry & Trading Co., Ltd., Shanghai Robtol Tool Manufacturing Co., Ltd., Shijiazhuang Global New Century Tools Co., Ltd., Sichuan Huili Tools Co., Task Tools & Abrasives, Wanli Tools Group, Wuxi Lianhua Superhard Material Tools Co., Ltd., Zhejiang Tea Import & Export Co., Ltd., Zhejiang Wanda Import and Export Co., Zhejiang Wanda Tools Group Corp., and Zhejiang Wanli Super-hard Materials Co., Ltd. Additionally, the ATM Single Entity (i.e., Advanced Technology & Materials Co., Ltd., AT&M International Trading Co., Ltd., Beijing Gang Yan Diamond Products Co., Cliff International Ltd., and HXF Saw Co., Ltd.) is part of the PRC-wide entity. See Issues and Decision Memorandum at 7 and 8 for more information concerning the ATM Single Entity as part of the PRC-wide entity and the effect of the Department's remand redetermination in Diamond Sawblades Manufacturer's Coalition v. United States, Consol. Court No. 13-00168, Slip Op. 16-48 (CIT May 11, 2016), which implicates entries of diamond sawblades from the PRC from the ATM Single Entity. A preliminary injunction issued by the Court of International Trade in Diamond Sawblades Manufacturers' Coalition v. United States, Court No. 13-00168, currently enjoins us from lifting suspension of liquidation for entries of subject merchandise produced and/or exported by the ATM Single Entity to the extent that such entries were made on or after March 22, 2013. See CBP Message Number 5238306 dated August 26, 2015, which is available at http://adcvd.cbp.dhs.gov/adcvdweb/ad_cvd_msgs/20287.

    For entries that were not reported in the U.S. sales databases submitted by an exporter individually examined during this review, the Department will instruct CBP to liquidate such entries at the PRC-wide rate. In addition, for the six companies that we determined had no reviewable entries of the subject merchandise in this review period, any suspended entries that entered under that exporter's case number (i.e., at that exporter's rate) will be liquidated at the PRC-wide rate.

    We intend to issue assessment instructions to CBP 15 days after the date of publication of the final results of review.

    Cash Deposit Requirements

    The following cash deposit requirements will be effective upon publication of these final results of review for all shipments of the subject merchandise from the PRC entered, or withdrawn from warehouse, for consumption on or after the publication date as provided by section 751(a)(2)(C) of the Act: (1) For subject merchandise exported by the companies listed above that have separate rates, the cash deposit rate will be the rate established in these final results of review for each exporter as listed above; (2) for previously investigated or reviewed PRC and non-PRC exporters not listed above that received a separate rate in a prior segment of this proceeding, the cash deposit rate will continue to be the exporter-specific rate; (3) for all PRC exporters of subject merchandise that have not been found to be entitled to a separate rate, the cash deposit rate will be that for the PRC-wide entity; (4) for all non-PRC exporters of subject merchandise which have not received their own rate, the cash deposit rate will be the rate applicable to the PRC exporter that supplied that non-PRC exporter. These deposit requirements shall remain in effect until further notice.

    Notification to Importers

    This notice serves as a final reminder to importers of their responsibility under 19 CFR 351.402(f)(2) to file a certificate regarding the reimbursement of antidumping duties prior to liquidation of the relevant entries during this review period. Failure to comply with this requirement could result in the Secretary's presumption that reimbursement of the antidumping duties occurred and the subsequent assessment of double antidumping duties.

    Administrative Protective Orders

    This notice also serves as the only reminder to parties subject to administrative protective order (APO) of their responsibility concerning the return or destruction of proprietary information disclosed under APO in accordance with 19 CFR 351.305(a)(3). Timely written notification of the return or destruction of APO materials or conversion to judicial protective order is hereby requested. Failure to comply with the regulations and terms of an APO is a sanctionable violation.

    These final results of review are issued and published in accordance with sections 751(a)(1) and 777(i) of the Act.

    Dated: June 7, 2016. Paul Piquado, Assistant Secretary for Enforcement and Compliance. Appendix Summary Background Company Abbreviations Other Abbreviations Diamond Sawblades Administrative Determinations and Results Scope of the Order Surrogate Country Separate Rates Differential Pricing ATM Single Entity Discussion of the Issues Respondent Selection Value-Added Tax Differential Pricing Surrogate Values Billing Adjustments Reconstruction of Control Numbers Rescission of Review in Part Recommendation
    [FR Doc. 2016-14047 Filed 6-13-16; 8:45 am] BILLING CODE 3510-DS-P
    DEPARTMENT OF COMMERCE National Oceanic and Atmospheric Administration RIN 0648-XD776 Endangered Species; File No. 19281 AGENCY:

    National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.

    ACTION:

    Notice; issuance of permit.

    SUMMARY:

    Notice is hereby given that Dr. Isaac Wirgin, New York University School of Medicine, Department of Environmental Medicine, 57 Old Forge Road, Tuxedo, NY 10987, has been issued a permit to import and take early life stages of endangered, captive shortnose sturgeon (Acipenser brevirostrum) for purposes of scientific research.

    ADDRESSES:

    The permit and related documents are available for review upon written request or by appointment in the Permits and Conservation Division, Office of Protected Resources, NMFS, 1315 East-West Highway, Room 13705, Silver Spring, MD 20910; phone (301) 427-8401; fax (301) 713-0376.

    FOR FURTHER INFORMATION CONTACT:

    Malcolm Mohead or Rosa L. González, (301) 427-8401.

    SUPPLEMENTARY INFORMATION:

    On May 18, 2015, notice was published in the Federal Register (80 FR 28236) of a request for a permit to import and conduct research on shortnose sturgeon early life stages had been submitted by the above-named applicant. The requested permit has been issued under the authority of the Endangered Species Act of 1973, as amended (ESA; 16 U.S.C. 1531 et seq.) and the regulations governing the taking, importing, and exporting of endangered and threatened species (50 CFR parts 222-226).

    In directed studies with endangered shortnose sturgeon early life stages, researchers will define the toxicities of varying concentrations of industrial contaminants, such as polychlorinated biphenyl (PCB) and Dioxin (2,3,7,8-TCDD). Shortnose sturgeon fertilized embryos are authorized to be imported by CITES I permit from the Acadian Sturgeon and Caviar, Inc., New Brunswick, Canada, to the NOAA Howard Marine Sciences Laboratory in Highlands, New Jersey, where the controlled research will take place. The laboratory tests will be conducted both singly and in combination with 10 temperature regimes and varying levels of dissolved oxygen, representing environmental stresses. Surviving progeny will be euthanized after tests are completed each year. In subsequent years of the five-year permit, the Permit Holder will evaluate the toxic effects and sensitivities of shortnose sturgeon to other contaminants.

    Issuance of this permit, as required by the ESA, was based on a finding that such permit (1) was applied for in good faith, (2) will not operate to the disadvantage of such endangered or threatened species, and (3) is consistent with the purposes and policies set forth in section 2 of the ESA.

    Dated: June 8, 2016. Julia Harrison, Chief, Permits and Conservation Division, Office of Protected Resources, National Marine Fisheries Service.
    [FR Doc. 2016-13969 Filed 6-13-16; 8:45 am] BILLING CODE 3510-22-P
    DEPARTMENT OF COMMERCE National Oceanic and Atmospheric Administration RIN 0648-XE122 Marine Mammal Stock Assessment Reports AGENCY:

    National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.

    ACTION:

    Notice of availability; response to comments.

    SUMMARY:

    As required by the Marine Mammal Protection Act (MMPA), NMFS has considered public comments for revisions of the 2015 marine mammal stock assessment reports (SARs).

    ADDRESSES:

    Electronic copies of SARs are available on the Internet as regional compilations and individual reports at the following address: http://www.nmfs.noaa.gov/pr/sars/.

    A list of references cited in this notice is available at www.regulations.gov (search for docket NOAA-NMFS-2015-0108) or upon request.

    FOR FURTHER INFORMATION CONTACT:

    Shannon Bettridge, Office of Protected Resources, 301-427-8402, [email protected]; Marcia Muto, Alaska Fisheries Science Center, 206-526-4026, [email protected]; Peter Corkeron, Northeast Fisheries Science Center, 508-495-2191, [email protected]; or Jim Carretta, Southwest Fisheries Science Center, 858-546-7171, [email protected]

    SUPPLEMENTARY INFORMATION:

    Background

    Section 117 of the MMPA (16 U.S.C. 1361 et seq.) requires NMFS and the U.S. Fish and Wildlife Service (FWS) to prepare SARs for each stock of marine mammals occurring in waters under the jurisdiction of the United States. These reports contain information regarding the distribution and abundance of the stock, population growth rates and trends, the stock's Potential Biological Removal (PBR) level, estimates of annual human-caused mortality and serious injury from all sources, descriptions of the fisheries with which the stock interacts, and the status of the stock. Initial reports were completed in 1995.

    The MMPA requires NMFS and FWS to review the SARs at least annually for strategic stocks and stocks for which significant new information is available, and at least once every three years for non-strategic stocks. NMFS and FWS are required to revise a SAR if the status of the stock has changed or can be more accurately determined. NMFS, in conjunction with the Alaska, Atlantic, and Pacific Scientific Review Groups (SRGs), reviewed the status of marine mammal stocks as required and revised reports in each of the three regions.

    NMFS updated SARs for 2015, and the revised reports were made available for public review and comment for 90 days (80 FR 58705, September 20, 2015). NMFS received comments on the draft SARs and has revised the reports as necessary. This notice announces the availability of the final 2015 reports for the 108 stocks that are currently finalized. These reports are available on NMFS's Web site (see ADDRESSES).

    Comments and Responses

    NMFS received letters containing comments on the draft 2015 SARs from the Marine Mammal Commission (Commission); five non-governmental organizations (The Humane Society of the United States (HSUS), Center for Biological Diversity (CBD), Whale and Dolphin Conservation (WDC), Turtle Island Restoration Network (TIRN), and the Hawaii Longline Association (HLA)); and one individual. Responses to substantive comments are below; comments on actions not related to the SARs are not included below. Comments suggesting editorial or minor clarifying changes were incorporated in the reports, but they are not included in the summary of comments and responses. In some cases, NMFS's responses state that comments would be considered or incorporated in future revisions of the SARs rather than being incorporated into the final 2015 SARs.

    Comments on National Issues

    Comment 1: The SAR administrative process must be improved; it is confusing, inefficient, and produces final SARs that are not based upon the best available scientific information. Because of the inefficient process used to produce SARs, the draft SARs fail to rely upon the best available data (i.e., the most current data that it is practicable to use), contrary to the MMPA. For example, the draft 2015 SAR only reports data collected through the year 2013, even though 2014 data are readily available. We appreciate that it is not practicable to incorporate into SARs the absolute most recently collected data; nevertheless, there is no credible justification to continue the present two-year delay in the use of information.

    Response: The marine mammal SARs are based upon the best available scientific information, and NMFS strives to update the SARs with as timely data as possible. In order to develop annual mortality and serious injury estimates, we do our best to ensure all records are accurately accounted for in that year. In some cases, this is contingent on such things as bycatch analysis, data entry, and assessment of available data to make determinations of severity of injury, confirmation of species based on morphological and/or molecular samples collected, etc. Additionally, the SARs incorporate injury determinations that have been assessed pursuant to the NMFS 2012 Policy and Procedure for Distinguishing Serious from Non-Serious Injury of Marine Mammals (NMFS Policy Directive PD 02-038 and NMFS Instruction 02-038-01) which requires several phases of review by the SRGs. Reporting on incomplete annual mortality and serious injury estimates could result in underestimating actual levels. The MMPA requires us to report mean annual mortality and serious injury estimates, and we try to ensure that we are accounting for all available data before we summarize those data. With respect to abundance, in some cases we provide census rather than abundance estimates and the accounting process to obtain the minimum number alive requires two years of sightings to get a stable count, after which the data are analyzed and entered into the SAR in the third year. All animals are not seen every year; waiting two years assures that greater than 90% of the animals still alive will be included in the count. As a result of the review and revision process, data used for these determinations typically lag two years behind the year of the SAR.

    Comment 2: Unlike mortality and serious injury estimates for small cetaceans, where extra time may be needed to obtain fishing effort and to expand observed takes to obtain fleet-wide estimates, for large cetaceans mortality estimates are direct minimum counts based on discovery of carcasses and any necropsies are generally completed promptly. There is no need to delay reporting by two years as has been common in the SARs.

    Response: Large whale mortality reports, like all interactions, go through the review and publication process outlined in the NMFS 2012 Policy and Procedure for Distinguishing Serious from Non-Serious Injury of Marine Mammals. NMFS produces annual marine mammal serious injury and mortality reports, which involves a clear process for review and publication. The serious injury and mortality data contained in the SARs come from these reports once they have been fully vetted. Therefore, the mortality data reported in the SARs are subject to the same delay outlined in the response to Comment 1.

    Comment 3: There are grossly outdated estimates of abundance for many stocks. The most recently proposed revision of NMFS's Guidelines for Assessing Marine Mammal Stocks (GAMMS) provided recommendations for addressing aging data by precautionarily reducing the Minimum Population Estimate (Nmin) annually (and consequently the PBR), until such time as new abundance data can be obtained. For stocks with outdated estimates this was often not done. NMFS's regional offices should follow the GAMMS in these cases and downwardly revise the PBRs for these stocks.

    Response: NMFS recently finalized revisions to the GAMMS (available at http://www.nmfs.noaa.gov/pr/sars/pdf/gamms2016.pdf). Regarding outdated abundance estimates, we did not finalize the proposed approach recommended by the GAMMS workshop participants. Rather, we will be further analyzing this issue, as the challenge of outdated abundance estimates continues and the problems resulting from stocks with “undetermined” PBR persists. Should we contemplate changes to the guidelines regarding this topic in the future, we will solicit public review and comment in a separate action.

    Comment 4: There is an unacceptably high percentage of stocks with “undetermined” or “unknown” PBR levels.

    Response: NMFS acknowledges this. Currently, the GAMMS direct that for stocks with abundance data greater than eight years old, PBR be considered “undetermined.” See response to Comment 3.

    Comment 5: With regard to status as “strategic” or “non-strategic,” it would seem prudent to declare stocks with unknown or undetermined PBRs as “strategic” unless there is clear and compelling evidence that there are no fishery interactions (i.e., data exist that there are none as opposed to a lack of data). Such an approach would be consistent with the overall purposes of the MMPA.

    Response: NMFS appreciates this recommendation. However, such designations must follow the statutory definition of “strategic”: Human-caused mortality exceeds PBR; the best available science shows the stock is declining and likely to be listed as threatened under the ESA within the foreseeable future; or that is currently listed as threatened or endangered under the ESA or is designated as depleted (MMPA section 3).

    Comment 6: The GAMMS recommend that peer-reviewed literature should be a primary source of information. In most regions there appears to be great reliance on gray literature (e.g., NMFS Tech Memos) and on unpublished manuscripts (e.g., results of studies stated to be “in prep”) and even personal communications; this needs to be corrected. By not making such literature available for review by the public, the public cannot adequately comment on whether such literature constitutes the best available science.

    Response: The SARs are to be based on the best available science. The use of unpublished reports and data within SARs is discouraged. NMFS strives to use peer-reviewed data as the basis for SARs. NMFS often relies on science that has been assessed through the NMFS Science Center's internal expert review process and/or has been subjected to other external expert review to ensure that information is not only high quality but is available for management decisions in a timely fashion. NMFS may rely on the SRGs to provide independent expert reviews of particular components of new science to be incorporated into the SARs to ensure that these components constitute the best available scientific information. Likewise, upon SRG review of these components and the draft SARs themselves, NMFS considers the SRG review of the draft SARs to constitute peer review and to meet the requirements of the OMB Peer Review Bulletin and the Information Quality Act. NMFS is undertaking an effort to remove references to unpublished manuscripts and personal communications from the SARs, and aims to fully implement this effort with the 2016 final SARs.

    Comment 7: The Commission recommends that NMFS specify the criteria that it intends to use to assess the appropriateness of its estimates of carcass recovery and cryptic mortality rates, and that it include in its stock assessment survey and research plans the collection of those data that are needed to estimate total mortality for all stocks. The Commission suggests discussion of collaborative opportunities in conjunction with the joint SRG meeting in February 2016.

    Response: We agree that there is a need to better understand and estimate undetected marine mammal mortalities and serious injuries, and a need to evaluate the use of correction factors for marine mammal mortality estimates. The issue of cryptic mortality was discussed at the February 2016 joint SRG Meeting. NMFS looks forward to working with the Commission and the SRGs on this issue.

    Comments on Atlantic Regional Reports

    Comment 8: In the North Atlantic right whale report, Table 1 documenting mortality appears to lack accounting for several mortalities. For example, a male calf that was killed in a vessel strike in Maine in July 2010 does not appear to have been included. Further, there was an abandoned calf in the Southeastern U.S. in March 2011, and, that same month right whale #1308 was killed by a ship strike, thereby orphaning her newborn calf. At the very least, this latter death of a documented right whale mother with calf should also assume the young, dependent calf died as well and its death added to the total for that year.

    Response: The right whale calf killed in July 2010 is included in Table 1 as a vessel strike mortality and has since been identified as #3901. We do not include abandoned calves if the mother is not known to have been killed or injured by human impact. The abandonment could be the result of poor maternal care. The calf of right whale #1308 is included in the Table 1 as a serious injury due to vessel strike according to the NMFS 2012 Policy and Procedure for Distinguishing Serious from Non-Serious Injury of Marine Mammals (Category L8 = dependent calf of a dead or seriously injured mother).

    Comment 9: The Commission, HSUS, CBD, and WDC recommend that multiple mortalities and/or serious injuries to several North Atlantic right whales (including #1151, 1311, 2160, 2460, 2660, 3111, 3302, [3308], 3692, and 3945) should be included in Table 2 of the SAR.

    Response: The following is a summary statement about each case. Cases were reviewed by NMFS Northeast Fisheries Science Center (NEFSC) staff and determinations made by NEFSC staff were later reviewed by experienced staff at all other Fisheries Science Centers, per the NMFS Policy and Procedure for Distinguishing Serious from Non-Serious Injury of Marine Mammals. NMFS staff look for evidence of significant health decline post event. We do not currently have a method to address sublethal effects or more subtle/slow health decline. Therefore, none of the recommended cases were incorporated into Table 2 of the SAR.

    • Whale #1151. This whale was seen free of gear and with a calf in the Bay of Fundy on 28 August 2009 and was resighted soon after with two wraps of line around her rostrum and body. All entangling gear was removed on 4 September 2009. Following disentanglement, she appeared to be swimming normally and, although she showed signs of compromise typical of females completing their calving and nursing cycle, NMFS determined the entanglement had not caused serious injury. However, she was still in a compromised condition in 2011 and had declined further when seen for the last time in June 2012. The Commission believes this case warrants a conservative redetermination that the 2009 entanglement did result in a serious injury.

    Response: NMFS reviewers considered any health changes post-disentanglement to be representative of normal inter-year fluctuations and comparable to the overall health of the population during the time frame in question.

    • Whale #2460. This whale was last seen in May 2012 in compromised health and with severe entanglement-related scars and wounds on her peduncle, additional entanglement scars on her head, and lesions on her back but without attached gear. The Commission is concerned that the observed entanglement injuries significantly compromised her heath and potential survival, and believes that a conservative injury assessment would warrant listing the scars and wounds observed in 2012 as indicative of a serious injury.

    Response: The animal's injuries are showing evidence of healing; the health status of this whale is comparable to the overall health of the non-injured population during the time frame in question.

    • The 2007 calf of #2460. This calf was euthanized in January 2009 when it stranded in North Carolina. The spine of this animal was grossly misaligned and this followed the documentation of deep entanglement marks on the calf at age 8 months. Researchers at the scene speculated that the spine deformity resulted from an entanglement. This animal's death should be prorated as a serious injury resulting from entanglement, much as the agency did for the serious injury in the table dated 7/18/2009.

    Response: The injury that led to the demise of this calf was acquired in 2007, so this event is counted as an entanglement mortality for that year, which does not fall within the time frame of this report (2009-2013).

    • Calf of Whale #2660. The table notes that this whale was missing her dependent calf at the time of her 2011 sighting when seriously injured and in deplorable physical condition; why is the calf not also counted as a mortality?

    Response: This calf, now #4160, has been resighted in good health.

    • Whale #3111. This whale is listed in the table as a pro-rated serious injury. Since the animal was last seen alive when badly entangled, it seems that this should be considered entirely fishery-related.

    Response: This whale has been resighted in much improved condition; he appears to be gear free, but this is not yet confirmed. This event is similar to #2029's entanglement. We will continue to prorate his injury as L10 (0.75) until he is either confirmed gear free or shows signs of significant health decline.

    • Whale #3398. This whale was seen in July 2012 with extensive entanglement wounds on his peduncle and fluke insertion and additional scars on his mouth and left flipper, and possibly around his blowhole. Resightings suggest these wounds appear to have compromised his health for more than two years, raising the possibility of suffering from chronic effects from the 2012 entanglement. The Commission believes that the record justifies a conservative determination of serious injury for this individual.

    Response: NMFS reviewers determined that this comment pertains to whale #3308 (not #3398 as identified in the comment). NMFS agrees that the lesions have increased; however, the animal's injuries are healing and its skin condition is comparable to the overall population.

    • Whale #3946. This whale was affected by two separate entanglement events. In December 2012 she was gear-free, but with severe entanglement wounds on her peduncle and flukes, and possible additional scars on her head. She was resighted later carrying lines from a new entanglement and showing signs that her condition had declined—she appeared thinner and had developed lesions on her body. When last seen in May 2014 she was confirmed to be free of gear. Given that these wounds appear to have compromised her health for more than two years, a serious injury determination would be an appropriate and conservative assessment for this individual.

    Response: The injuries are showing evidence of healing; the health status of this whale is comparable to the overall health of the non-injured population during the time frame in question.

    • Whale #3692. This whale, accompanied by a calf, was observed in March 2013 off South Carolina with a fresh propeller injury on her right fluke. When she was last sighted in April 2014 her condition was poor; her fluke had fallen off, blisters and lesions had formed at several points on her body and head, and she appeared to be thin. Given the decline in her condition following the propeller wound, this case should be considered a serious injury.

    Response: The animal's injuries are showing evidence of healing. Its health status is comparable to the overall health of the non-injured population during the time frame in question.

    • Whale #2160. This animal was seen gear-free in April 2013 with severe scars and a large open wound on his tail stock apparently from an entanglement. He also had rake marks, skin lesions, and poor skin color behind the blowhole, suggesting poor condition; he has not been resighted. Given the severe nature of his wounds and compromised condition, this case should be considered a serious injury.

    Response: This whale has since been resighted. The injuries are showing evidence of healing; the health status of this whale is comparable to the overall health of the non-injured population during the time frame in question.

    • Whale #3302. This individual is not listed in the table, but has not been seen since the last sighting on November 11, 2011 when seriously entangled. This case should be at least a pro-rated serious injury. At what point, when no longer being sighted, will NMFS consider it dead and pro-rate the death as fishery-related?

    Response: This whale is included in the table as a serious injury due to entanglement, which is given the same score as “dead.” NMFS will not presume the whale is dead until its death is confirmed and the animal is removed from the population. The initial entanglement date is 4/22/11.

    • Unk Whale. A right whale hit by a vessel on 12/7/2012 is pro-rated as an injury at 0.52. Please explain the basis for this very precise pro-ration.

    Response: The basis for the proration values is explained in the NMFS Procedure for Distinguishing Serious from Non-Serious Injury of Marine Mammals (NMFS Instruction 02-038-01). The vessel strike event described fits two categories: L6b—a vessel less than 65 feet traveling at greater than 10 knots (prorated as 0.20 serious injury), and L11—confirmed laceration of unknown depth, includes observation of blood in water (prorated as 0.52 serious injury). When more than one criteria applies to an event, we apply the greater value.

    • Whale #1311. This animal was found dead on 8/11/2013. Video taken at the time shows the whale floating with line entering its mouth and associated wrapping wounds around its head. It was last seen alive in April 2013 with no signs of entanglement.

    Response: The carcass of this whale was not necropsied; thus, it does not currently meet the criteria for determining human interaction mortalities. Without a necropsy, we could not determine if the cause of death was due to entanglement or possible vessel strike.

    Comment 10: The Commission is concerned that the long-finned pilot whale SAR does not sufficiently explain the extent to which abundance may be underestimated. The Commission recommends that NMFS consider whether further analysis of past surveys could clarify: (1) The proportions of the long-finned pilot whale stock using waters near the Gulf Stream off the U.S. northeast coast and Canada, and (2) the extent to which the new population estimate is negatively biased and the new PBR is set too low.

    Response: NMFS recognizes that the current abundance estimate is likely biased low. Therefore, we are conducting additional analyses to develop more appropriate abundance estimates for both long- and short-finned pilot whales.

    Comment 11: The Status of Stock section of the short-finned pilot whale—Western North Atlantic Stock assessment report did not state that the average annual human-caused M/SI is below the PBR; this conclusion had been included in previous reports for this stock. There is no new statement in the 2015 SAR to describe current M/SI totals relative to PBR. The Commission recommends that the deleted sentence be replaced by one stating that the point estimate for average annual human-caused M/SI does not exceed the stock's PBR, but it is roughly equal to the PBR and clearly greater than 10 percent of the PBR. Given the possibility that fishery-related M/SI is above PBR, the Commission recommends further that the western North Atlantic short-finned pilot whale stock be categorized as “strategic.”

    Response: We have reinstated the sentence indicating the 2009-2013 mean annual human-caused M/SI does not exceed PBR, as this is still the case. While there is no “new” statement, the SAR continues to state: “Total U.S. fishery-related mortality and serious injury attributed to short-finned pilot whales exceeds 10% of the calculated PBR.” Following the GAMMS, PBR calculations already include a precautionary approach that accounts for uncertainty, and we have compared the five-year mean annual M/SI to PBR. Designating stocks that fluctuate around PBR from year to year as strategic is a larger issue that we plan to raise with the Scientific Review Groups.

    Comment 12: Most stocks of cetaceans in the Gulf of Mexico are either known or likely to have been adversely affected by the 2010 Deepwater Horizon (DWH) oil spill. Following the spill, data were collected on many of these stocks as part of the Natural Resource Damage Assessment (NRDA) process, but those data are not yet available to be used in stock assessments. The Commission recommends that NMFS make every effort to publish and release all survey and related data it has on Gulf of Mexico cetacean stocks as soon as the NRDA process is complete, and, where appropriate, conduct new surveys to enable assessments of the extent to which abundances of the Gulf of Mexico cetacean stocks have changed in recent years.

    Response: The DWH litigation is recently completed; as NRDA data become available, we will continue to publish and incorporate these data into the SARs as appropriate.

    Comment 13: In some cases (e.g., Jacksonville estuarine stock, many of the Bay, Sound, and Estuary (BSE) stocks of bottlenose dolphins in the Gulf of Mexico) the most recent estimates of abundance are around 20 years old. Many of these same stocks with outdated abundance estimates have been recently subjected to unusual mortality events (UMEs). The lack of usable stock abundance data for so many of the bottlenose dolphin stocks is unacceptable and highly risk prone, and must be remedied on a priority basis for future SARs.

    Response: NMFS acknowledges that the abundance estimates of many of the BSE stocks of bottlenose dolphins are outdated. NMFS will collect data in 2016 to update abundance estimates for Galveston Bay, Texas and Timbalier-Terrebonne Bays, Louisiana bottlenose dolphin stocks. As resources continue to be limited, NMFS has developed a Threat Assessment Priority Scoring System for prioritizing research on common bottlenose dolphin stocks (see Phillips and Rosel 2014).

    Comment 14: Tracking stock status is often confounded by differences in survey area or methodology. For example, the best estimate for the Southern North Carolina Estuarine System stock of bottlenose dolphins declined from 1,614 in the 2012 SAR to 188 in the 2013 SAR, which was the result of using a 2006 mark-recapture survey in the 2013 SAR whereas the 2012 SAR used an aerial line-transect study. The abundance is now considered “unknown” because all of the surveys on which estimates were made are now more than eight years old. The agency must take a more careful look at its survey intervals and design to assure comparability in range, seasons, effort, methodology, and other factors that are compounding the ability to more precisely define population estimates and to provide trend data, as required by the MMPA.

    Response: NMFS has standardized its survey methodology for large-scale aerial and ship surveys within the Atlantic, and following the 2016 ship surveys, we should be able to begin analyzing trends. Large-scale surveys within the Gulf of Mexico are also standardized, and with additional data collection, trend analysis should be possible. NMFS convened a workshop and prepared a technical memorandum to create a “standard” approach to photo-ID capture-mark-recapture techniques for estimating abundance of bay, sound, and estuary populations of bottlenose dolphins along the East Coast and Gulf of Mexico (Rosel et al. 2011). While progress is being made, at present resource constraints limit the NMFS Southeast Fisheries Science Center's (SEFSC) ability to analyze trends for the stocks for which there are data. Because the SEFSC marine mammal data collection program is generally supported through collaborations with other Federal agencies, research priorities (including areas surveyed) are balanced between the data needs of NMFS and our external partners.

    Comment 15: NMFS should prioritize observer coverage for fisheries that have self-reported takes but where observer coverage is either entirely lacking, occurring intermittently, or at such low levels that updated and reliable estimates of fishery-related mortality are not possible. Stock assessments cannot meaningfully report the statutorily required information on status and threats to marine mammals until and unless observer coverage is increased in fisheries with self-reported mortalities, evidence of strandings occurring at elevated rates that coincide with the greatest effort by the fishery, or where observer coverage has documented takes that may or may not have been incorporated in the SARs.

    Response: NMFS' observer programs fulfill a wide range of requirements under MMPA, ESA, and the Magnuson-Stevens Fishery Conservation and Management Act (MSA). Observer programs serve a wide range of purposes under these three statutes, including, but not limited to:

    • Providing information on commercial catches to inform fishery stock assessments and management (e.g., setting of annual catch limits).

    • Accounting for total catches in some fisheries, and discards in other fisheries, to support the monitoring of fishery-, vessel-, or sector-specific catches of managed species.

    • Monitoring fishery-related mortality and serious injury of marine mammals.

    • Monitoring incidental take limits of species that are listed under the ESA.

    • Collecting biological samples (e.g., otoliths, gonads, size data, genetic data for species identification purposes) to support stock assessment processes.

    • Supporting innovative bycatch reduction and avoidance programs.

    • Helping to promote the safety of human life at sea.

    Each NMFS region administers an observer program to address programmatic mandates under the MMPA, ESA, and MSA. The data collected by these observer programs support the management and conservation of fisheries, protected resources, and marine ecosystems throughout the United States' exclusive economic zone. Given the wide array of needs and limited resources, NMFS prioritizes observer coverage based on a number of factors. MMPA section 118(d)(4) specifies that the highest priority for allocation shall be for commercial fisheries that have incidental mortality or serious injury of marine mammals from stocks listed as endangered species or threatened species under the ESA; the second highest priority shall be for commercial fisheries that have incidental mortality and serious injury of marine mammals from strategic stocks; and the third highest priority for allocation shall be for commercial fisheries that have incidental mortality or serious injury of marine mammals from stocks for which the level of incidental mortality and serious injury is uncertain. NMFS uses this guidance when allocating funding to observe fisheries with little or no current observer coverage. For example, in 2012 and 2013, NMFS observed the Southeast Alaska drift gillnet fishery, which had not been previously observed but was potentially interacting with ESA-listed humpback whales and a strategic stock of harbor porpoise (i.e., the highest and second highest priorties for observer coverage noted in the MMPA).

    Comment 16: In the North Atlantic right whale report's section on Population Size, the phrase “known to be alive” should be changed to “presumed to be alive,” which is the wording used by the author of the 2011 Right Whale Report Cards from which this number was taken. At the end of this section, the sentence: “For example, the minimum number alive for 2002 was calculated to be 313 from a 15 June 2006 data set and revised to 325 using the 30 May 2007 data set” has been in this SAR since 2008 and seems stale.

    Response: This number is not taken from the Report Card; the Nmin value for right whales reported within the SAR includes only animals known to be alive because they were either seen during the reference year or seen both before and after the reference year. (Hence, there is no presumption of life.) The count of animals known to be alive is updated every year. Animals not seen for three or more years may be added back if they are shown to be alive in a subsequent year. The example given regarding the 2006 versus 2007 data makes this point.

    Comment 17: In the “Current and Maximum Net Productivity Rates” section of the North Atlantic right whale report, the information in the third paragraph is outdated regarding calving rates through 1992. More recent data on intervals are available from the right whale catalog, and are presented annually at right whale consortium meetings. For example, since the paper cited in the draft SAR for that information (Knowlton et al. 1994), there are data indicating the calving interval improved, but in more recent years has returned to lengthy or even increasing intervals. Later in the section the draft SAR cites the high proportion of juveniles in the population as of publications dated 1998 and 2001 (Hamilton et al. 1998, Best et al. 2001). While this may still be true, is there no more current information?

    Response: This SAR has been amended to include the “production/Nmin,” which is a better description of average productivity than calving interval. As a point of clarification, the draft SAR states on page 7: “An analysis of the age structure of this population suggests that it contains a smaller proportion of juvenile whales than expected (Hamilton et al. 1998; Best et al. 2001), which may reflect lowered recruitment and/or high juvenile mortality.”

    Comment 18: The North Atlantic right whale report's Background section acknowledges the large number of right whale carcasses documented but not necropsied to determine likely cause of death. We believe NMFS must undertake an effort through modelling to apportion mortalities among categories such as unknown, vessel strike, or entanglement based on historic proportions of deaths from necropsied animals. It should be possible to assign a proportional cause of death to the number of carcasses that were not retrieved/necropsied. Our records show that at least seven carcasses were not retrieved between 2009-2013.

    Response: We agree that this work would be valuable. In the future we intend to use a statistically-based estimate of fishing mortality. It is more complex than assigning a simple proportion to discovered carcasses, and we will use mark recapture data to attribute causation to latent mortality as well as attribute mortality causes to discovered carcasses unable to receive a proper necropsy.

    Comment 19: The North Atlantic right whale report's Fishery-Related Serious Injury and Mortality section cites Van der Hoop et al. (2012) as indicating that take reduction measures may not be working adequately to reduce mortality from entanglements and additional measures need to be taken. A more recent publication by NMFSs authors reaching the same conclusion (Pace et al. 2014) should also be included.

    Response: The Pace et al. (2014) reference was added to the SAR.

    Comment 20: In the Gulf of Maine humpback whale SAR, NMFS relies on maps and other information based almost solely on shipboards surveys. NMFS should reconsider this approach and, as it does with North Atlantic right whales, also rely on catalog data to glean information on distribution and similar vital characterizations of the population. In addition, NMFS is relying on outdated information about stock structure and use of winter habitats in the Caribbean, as Stevick and colleagues (2015) have provided more recent insight from genetic and other data that indicate that more than one stock appears to be using the eastern Caribbean. NMFS also cites Barco et al. (2002) that suggests that the mid-Atlantic may represent a supplemental winter feeding area for humpback whales. There is photographic evidence of their increasing presence and winter use of the waters between New York and Delaware Bay in spring, summer, and fall, some of which shows site fidelity within and between seasons, with at least one quarter of the photographically identified animals in a database matched to the Gulf of Maine stock. This information should be considered in updating the SAR. The Virginia Marine Science Museum has also documented sightings and responded to stranded animals in significant numbers in the Chesapeake Bay region since this 2002 citation.

    Response: The SAR's map is consistent with maps in other SARs in which the abundance estimate is derived from a line-transect survey (including both aerial and shipboard effort). The humpback whale SAR uses the best estimate available and has frequently used line-transect surveys in the past; the estimates derived from the 2008 and 2011 surveys are reported in the SAR.

    The Gulf of Maine stock of humpback whales is somewhere on the order of 20% of a larger breeding population, and constitutes a cluster of feeding aggregations that shows some site fidelity to the Gulf of Maine. Although a single Gulf of Maine animal was killed in the Bequia indigenous hunt (within the eastern Caribbean), overwhelming evidence exists to show the Gulf of Maine stock uses the western Caribbean as a breeding ground along with four to five other feeding aggregations. The bulk of the animals within the eastern Caribbean show no site fidelity to the Gulf of Maine. The other facts cited within the comment are mostly anecdotal and have not been adjusted for search effort.

    Comment 21: In the Gulf of Maine humpback whale SAR, NMFS omits new information that was recently considered in its global status review on humpback whales. The Population Size section does not provide data from MONAH (the international study titled “More North Atlantic Humpbacks”) surveys, although these were cited in the recent NMFS global status review for the species (Bettridge et al. 2015). NMFS also omits consideration that the Robbins (2007) study also supports low reproductive rates in the species, not solely low calf survival. This should be included so as not to leave readers with the idea that the only data available are outside confidence intervals.

    Response: The population of humpback whales surveyed through the MONAH study comprises more than the humpback whales that feed in the Gulf of Maine, therefore it is not appropriate to use the MONAH abundance estimate for the abundance estimate for the Gulf of Maine stock. We modified the SAR language with regard to confidence intervals and noted that Robbins (2007) found reproductive rates to be highly variable.

    Comment 22: The Gulf of Maine humpback whale SAR's statement that the apparent calf survival rate is 0.664 as an “intermediate” value between two studies appears incorrect. In fact, it appears “low” as compared to other areas and not just “intermediate,” as the recent status review itself stated that this value “is low compared to other areas and annually variable.”

    Response: As stated above (see response to Comment 20), the West Indies population unit has been proposed by NMFS as a DPS as a result of the ESA global status review of humpback whales. This proposed DPS is not directly relevant to the MMPA Gulf of Maine stock. Metapopulation segments commonly have (or are usually expected to have) different demographic patterns if those populations are not growing; thus it would be common for different segments to have differing mortality rates and subsequent productivity rates. Hence, we cannot presume that integrated population statistics reflect that of individual segments. We removed the word “intermediate.”

    Comment 23: The Gulf of Maine humpback whale SAR underestimates the level of mortality for this stock; more recent literature is available and should be used. Reference is made to the likelihood that undocumented entanglements are occurring. We note that Van der Hoop et al. (2013) found that between 1970-2009, cause of death was not undetermined for nearly 60 percent of humpback whale carcasses in the Northwest Atlantic due to decomposition, an inaccessible carcass, or where no necropsy data were provided to indicate cause of death. Similar results were found by Laist et al. (2014). Volgenau (1995) is cited for the source of entanglements through 1992. Johnson et al. (2005) found 40 percent of humpback whale entanglements were in trap/pot gear and 50 percent were in gillnet. While even these data are now a decade old, they at least reference gear types involved in humpback entanglements in U.S. waters, not just in Canada.

    Response: It was an oversight that the Johnson et al. (2005) paper was not included in the draft SAR; it has been included in the final SAR. However, one should be skeptical of estimating gear-specific entanglement rates based on a very small sample size and when one would suspect different levels of detectability among gear types doing harm. In stock assessments for which there is not a statistical model for estimating fisheries interactions, NMFS has consistently maintained the policy that without unambiguous evidence that a stranding was due to human interaction, such strandings will not be attributed to a human cause.

    Comment 24: In the Gulf of Maine humpback whale SAR, the following cases of dead or seriously injured humpbacks are missing and should be added to Table 2:

    • Laist et al. (2014) note a dead humpback whale that was attributed to a vessel strike on 7/27/2009 inside the NY seasonal management area.

    Response: This carcass was battered against a jetty. A necropsy revealed broken bones, but the animal was so severely decomposed it could not be determined if the fractures were pre- or post-mortem.

    • On 6/3/2011 a humpback whale on Jeffreys Ledge was disentangled but noted to be “quite thin and body posture was hunched,” according to record notes on the NMFS and Center for Coastal Studies Large Whale Disentanglement Network Web site. This animal was noted to be the 2009 calf of the humpback whale known as “Lavalier” and has apparently not been seen since that incident.

    Response: This animal has been named “Flyball” and has been resighted in good health.

    • On 3/11/2012, this same Web site noted that a humpback whale had become entangled in gillnet gear off Cape Hatteras, North Carolina and broke free with “some amount of top line and webbing anchored somewhere at the forward end of the whale.” This should be considered for pro-rating as a serious injury.

    Response: This event was observed by a trained Northeast Fisheries Observer Program observer. The whale was released with a small section of netting draped over a fluke edge (which corresponds to large whale injury category L3 in the NMFS Procedure for Distinguishing Serious from Non-Serious Injury of Marine Mammals, NMFS Instruction 02-038-01) that it was likely to shed.

    • The Web site notes a humpback whale disentangled but apparently seriously injured on 4/12/2012. The site states “the overall condition of the whale (~30 feet long) seemed poor, indicating that it had been entangled significantly longer than the few days since first report. Line across the back had become ingrown and line around the flukes had left numerous scars, some of which were resolving while others were not. The whale was quite thin and, in aerial shots, the widest girth of the whale was at the skull. There were patches of whale lice scattered across its body.” This appears to fit within the definition of a serious injury and should, at the very least, be pro-rated as such.

    Response: This humpback whale has an entanglement date of 4/7/2012; it was entangled for fewer than five days and the Center for Coastal Studies Web site also states that “the condition of the whale seems somewhat poor (thin with patches of whale lice) but it is not clear if this is part of a seasonal effect or related to its entanglement.” This whale was entangled again on 4/13/2012 and again disentangled.

    • On 1/6/2013, a humpback whale was noted off Virginia Beach with significant line wrapped around its flukes and it was not able to be disentangled. This should be considered a serious injury.

    Response: The entanglement configuration shifted, indicating it was not constricting. The final configuration is a non-constricting loop at the fluke insertion which meets our L3 criterion (NMFS Procedure for Distinguishing Serious from Non-Serious Injury of Marine Mammals, NMFS Instruction 02-038-01) and is therefore considered a non-serious injury.

    Comment 25: In the Gulf of Maine, humpback whale SAR information has been omitted from the Status of Stock section. This section cites the recent NMFS global status review, which included evaluation of the status of this stock. The status review states “There are insufficient data to reliably determine current population trends for humpback whales in the North Atlantic overall.” Rather than acknowledging this in the draft SAR, NMFS retains the assertion that “[a]lthough recent estimates of abundance indicate a stable or growing humpback whale population, the stock may be below OSP [Optimum Sustainable Population] in the U.S. Atlantic EEZ” (emphasis added). Indeed, the status review found that the population trend was likely flat and the population had not met goals stipulated in its recovery plan for a sustained growth rate. Given the failure to achieve its recovery plan goals for minimum population and sustained growth rate, and the annual losses due to entanglement and vessel strikes that far exceed the stock's PBR, it seems clear that the stock is below OSP, rather than the NMFS assertion that they “may” be below OSP.

    Response: This comment blurs statements about two proposed DPSs under the ESA (West Indies and Cape Verde Islands/Northwest Africa) with those about the Gulf of Maine MMPA stock, which is a small segment within one of these proposed DPSs. With regard to the phrase “may be below . . .,” scientists nearly always include a caveat for uncertainty in any declaration. We cannot make a conclusive statement with respect to whether a stock is within the OSP range without having conducted an OSP analysis. A population at carrying capacity, when harvested above its current level of productivity (which is quite low for mammals) will show a decline (until productivity increases). A population at OSP will show an increase if harvested (killed) at per capita rates lower than productivity (until productivity declines due to resource scarcity). Theoretically, a population of humpback whales could be at OSP in perpetuity while human-caused mortality removed all the excess; thus, the trend in abundance would be flat, but it remains at OSP.

    Comment 26: For the Western North Atlantic stock of long-finnned pilot whale, it is our understanding that a survey will be conducted in the summer of 2016 that may provide better data of abundance, given the discrepancy between the more recent survey and an outdated earlier survey—each of which covered a different extent of the range. Until that time, given margins of error, fishery-related mortality appears to be at or possibly over the PBR. We are hopeful that NMFS will resolve the discrepancies in methodology and/or areas surveyed to resolve widely discrepant estimates such as this one.

    Response: NMFS agrees; the 2016 survey, as well as the abundance analyses underway on surveys through 2014, should provide improved abundance estimates for long-finned pilot whales within this area.

    Comment 27: NMFS should include within the Western North Atlantic harbor and gray seal SARs a brief mention of high levels of animals observed entangled in fishing-related debris, largely from actively fished gear. The final SARs for both of these species should contain some language and analysis reflecting that a notable percentage of seals in the Gulf of Maine haulouts are seen entangled in fishery-related gear that may result in serious injury.

    Response: The gray seal SAR currently contains the language, “analysis of bycatch rates from fisheries observer program records likely greatly under-represents sub-lethal fishery interactions. Photographic analysis of gray seals at haulout sites on Cape Cod, Massachusetts revealed 5-8% of seals exhibited signs of entanglement (Sette et al. 2009).” Both harbor and gray seal SARs now emphasize the fact that entanglement is an issue with both species, though we have found it less prevalent in harbor seals.

    Comment 28: Regarding the Gulf of Mexico Bryde's whale, we are concerned about the level of ship strikes, which are estimated to be 0.2 per year, well above the PBR of 0.03. It also concerns us that two of the stranded animals are considered to be a part of the unusual mortality event (UME) resulting from the Deepwater Horizon oil spill, which has continued to affect bottlenose dolphins and may be having effects on this stock. Given the need to include the most recent information, NMFS should include a note that in April 2015, NMFS made a positive 90-day finding on a petition to list this population as “endangered” under the Endangered Species Act.

    Response: To clarify, the April 2015 finding was that the petition presented substantial scientific or commercial information indicating that the petitioned action may be warranted. Accordingly, NMFS initiated a review of the status of this species to determine if the petitioned action is warranted. NMFS had added text to the SAR noting the positive 90-day finding on the petition (80 FR 18343, April 6, 2015) and our ongoing status review.

    Comment 29: Mortality for the Gulf of Mexico eastern coastal stock of common bottlenose dolphins cannot be quantified because fisheries known to interact with the stock (including a wide variety of Category II and III fisheries) are not subject to observer coverage and/or the dataset from the observer program is out of sync with the five-year analytical time period used in this SAR. NMFS must either reconsider its observer coverage levels and placement in order to provide timely data for the SARs or it must re-prioritize analysis so that take data and mortality estimates can be incorporated in a timely manner.

    Response: NMFS agrees that observer coverage and the resulting M/SI data collected through observer programs is essential to assessing marine mammal stocks. Category II fisheries are subject to observer coverage pursuant to the requirements for Category I and II fisheries in 50 CFR 229.4. Given limited funding, NMFS cannot realistically observe all fisheries that may pose a risk to marine mammals. Anticipating this, the MMPA provides guidance for prioritizing observer coverage with the first priority being commercial fisheries that kill or seriously injure ESA-listed marine mammals, the second priority being strategic stocks, and the third priority being those stocks for whichM/SI incidental to commercial fishing is uncertain. NMFS continues to work internally to prioritize funding for observing fisheries across the U.S. given multiple mandates and requirements.

    In the 2015 SARs, NMFS provided marine mammal bycatch from the shrimp trawl fishery, which had not been estimated previously. The first bycatch estimate covered 2007-2011 because those were the data available at the time analysis began. The GAMMS suggest: “If mortality and serious injury estimates are available for more than one year, a decision will have to be made about how many years of data should be used to estimate annual mortality. There is an obvious trade-off between using the most relevant information (the most recent data) versus using more information (pooling across a number of years) to increase precision and reduce small-sample bias. It is not appropriate to state specific guidance directing which years of data should be used, because the case-specific choice depends upon the quality and quantity of data. Accordingly, mortality estimates could be averaged over as many years as necessary to achieve statistically unbiased estimation with a coefficient of variation (CV) of less than or equal to 0.3. Generally, estimates include the most recent five years for which data have been analyzed, as this accounts for inter-annual variability. However, information more than five years old can be used if it is the most appropriate information available in a particular case” (NMFS 2016). NMFS is currently evaluating the appropriate time interval to produce estimates for this fishery and will update the SARs accordingly.

    Comment 30: Similar to the Eastern Gulf of Mexico stock, data on Northern Gulf of Mexico bottlenose dolphin takes in the shrimp trawl fishery were discarded due to a dyssynchrony in the analytical period with the five-year average in the SAR. Given the low level of observer coverage and the CV, it is possible that this stock is being taken at a level that is around 50 percent of PBR, which would make this fishery a Category I fishery and result in higher priority for observer coverage. We recommend that NMFS re-evaluate observer placement and assure that the level of coverage is sufficient to accurately document and assess fishery impacts.

    Response: The information was not discarded and is still provided in the SAR (i.e., the 2007-2011 mortality estimate of 21 for the commercial shrimp trawl fishery). Currently, there is only one shrimp trawl bycatch estimate and it is for 2007-2011. The estimate does not fit in the standard five-year time frame that is reported in this SAR (i.e., 2009-2013). The 2007-2011 estimate was not included in the minimum total mean annual human-caused mortality and serious injury for the stock during 2009-2013 (0.4). Additionally, with so many unobserved fisheries (menhaden, crab traps, hook and line, gillnet), any mortality estimate is likely an underestimate. The PBR of the stock is 60 but the true fishery-related mortality and serious injury for 2009-2013 is not known. However, it is clearly stated in the SAR that the mortality estimate is, at a minimum, greater than 10% of the PBR. This is the only definitive statement NMFS can make given current information. NMFS agrees that it is possible that the fishery-related mortality and serious injury could be as much as 50% of PBR. However, given limited fishery observer resources, there are a number of factors that affect observer coverage prioritization. See response to Comment 29.

    Comment 31: For the Northern North Carolina Estuarine stock of bottlenose dolphins, data and text regarding the mid-Atlantic coastal gillnet fishery in Table 2 of the draft SAR only go through 2011, although this SAR should have data at least through 2013. A footnote in Table 3 of the draft SAR states that “[m]ortality analyses that use observer data are updated every three years. The next update is scheduled for 2015 and will include mortality estimates for years 2012-2014.” It is not clear why a mortality estimate is only provided every three years when it can be done annually for other stocks.

    Response: The observed mortality data for the mid-Atlantic coastal gillnet fishery was updated through 2011 because it is only updated every three years for Atlantic coastal bottlenose dolphin stocks. The decision to update the gillnet mortality estimates every three years was reviewed by the Atlantic Scientific Research Group in 2008 after the NEFSC provided a presentation showing the challenges associated with estimating annual mortality with any degree of confidence under a scenario of continued decline in observed interactions. At that time, it was considered an appropriate timeframe for updating observed bycatch mortality for the Atlantic stocks given the very low frequency and inter-annual variability of observed takes (average is less than one observed take per year). Although several of the factors that led to this decision in 2008 still exist today (i.e., mean observed takes less than one per year, status quo levels of observer coverage, and large number of strata due to complexity of stock identification), it became apparent during the 2013 Bottlenose Dolphin Take Reduction Team meeting that the Northern North Carolina Estuarine System stock mortality and serious injury estimate is likely exceeding its PBR. As a result, NMFS plans to re-evaluate the schedule and methods for updating future observed mortality rates and estimates for Atlantic stocks observed interacting with mid-Atlantic coastal gillnet fisheries.

    Comments on Pacific Regional Reports

    Comment 32: Very few Pacific stocks (only four stocks of cetaceans and two stocks) were updated in the draft 2015 SARs. NMFS states “. . . all others will be reprinted as they appear in the 2014 Pacific Region Stock Assessment Reports (Carretta et al. 2015).” If these stocks were reviewed and NMFS determined no update was warranted, NMFS should provide reviewers and other members of the public with information that NMFS has, in fact, complied with MMPA mandates for reviewing and/or revising stock assessments for strategic stocks and not simply neglected to review them.

    Response: NMFS reviews all SARs annually for potential revision. New data on human-caused mortality and serious injury are published annually, even if they do not appear in revised SARs. Reports may not necessarily be revised every year for strategic stocks, unless new information will result in a status change for that stock or species.

    Comment 33: NMFS's draft SARs largely address information only through 2013 and contain no updates of large baleen whale stocks within this iteration of the draft SARs. More recent data on increasing numbers of large whale mortalities from ship strikes and entanglements should be considered in the draft SARs. Additionally, when animals involved in these interactions cannot be identified to species, pro-rating to species seems warranted to better understand and quantify anthropogenic impacts on stocks that may be ESA-listed. We encourage NMFS to undertake this effort.

    Response: NMFS is working on methods to prorate human-caused injury and mortality of unidentified whale cases to species along the U.S. west coast. These proration methods will be applied to respective SARs following peer review and publication.

    Comment 34: While we understand that California sea lions are not considered a strategic stock, there has been elevated mortality in this species as part of an on-going UME. This UME was mentioned in the 2014 SAR (updated as of June 2015), although the pup counts are no more recent than 2011 and thus do not reflect possible impacts on productivity and population trends. Population data and updates on the impact of the UME must be included in the next iteration of SARs for 2016, since the ongoing UME and high levels of pup mortality constitute “significant new information” triggering the MMPA's requirement to conduct a stock assessment.

    Response: NMFS did not revise the SAR for California sea lions in 2015. The 2014 SAR addressed the UME, but this did not result in a change in the stock's status under the MMPA.

    Comment 35: Population data are provided for the Southern Resident stock of killer whales through 2014; NMFS should use more recent data in stock assessments for other species/stocks wherever possible.

    Response: NMFS utilizes the most recent population data available at the time the draft reports are prepared. In the case of the draft 2015 Southern Resident killer whale report, population size data from 2014 is utilized, because it was available at the time the draft report was prepared. This is not the case for all stocks in all years, where direct enumeration of the stock's size is less straightforward.

    Comment 36: Given the status of insular false killer whales, we strongly encourage NMFS to prioritize observers on fisheries such as the short line and kaka line fisheries in which there is either anecdotal report of evidence of injury consistent with fishery interaction as is mentioned in the SAR.

    Response: Given resource and other constraints, NMFS does not currently have plans to observe state-managed fisheries in Hawaii, but will continue to work with the Hawaii Department of Land and Natural Resources as available resources allow to improve data collection in these fisheries.

    Comment 37: The draft SAR discusses overlap in distribution of insular and pelagic stocks of false killer whales and takes within the overlap zone. We generally support the method of pro-rating takes to one or the other stock in the overlap zone, as we do the apportioning of observed takes of “blackfish” as either false killer whales or short-finned pilot whales.

    Response: NMFS will continue to prorate takes of false killer whales among potentially affected stocks and takes of blackfish to species when stock or species-identity of the take is unknown.

    Comment 38: The draft SAR indicates a decline in population of the Main Hawaiian Islands (MHI) Insular stock of false killer whales from 138 to 92 since the last report. However, the discussion in the section of the draft SAR still cites only literature from 2010 that documented apparent declines from 1989-2007, and provided the results of a Population Viability Analysis that calculated an average rate of decline of nine percent per year. This change in the abundance estimate for this stock since the last SAR estimate is a far greater decline than predicted. The final SAR should contain some discussion of this apparent decline or provide a stronger caveat for why this estimate may not be reliable.

    Response: The apparent decline from 138 to 92 noted by the commenter is in the minimum abundance (Nmin), not the total population abundance. Nmin declined for MHI insular false killer whales in the 2015 SAR. Nmin for MHI insular false killer whales is determined based on the number of distinctive individuals seen between 2011 and 2014 and is not corrected for the level of effort or other factors that might have resulted in a lower total count for that period. Analysis of MHI insular false killer whale abundance and trend is ongoing and will be presented in a future SAR.

    Comment 39: With regard to the pelagic stock of false killer whales, the PBR remains approximately the same as the prior SAR estimate; however, this draft SAR notes that 2014 takes subsequent to the time period covered in the SAR (2009-2013) were “the highest recorded since 2003” although overall bycatch estimates were not available as of the time the SAR was drafted. Even without inclusion of 2014's excessive mortality and serious injury, the takes for this stock are acknowledged to exceed the PBR for the period 2009-2013 although NMFS states that additional monitoring is required before concluding that the take reduction plan for the stock had failed to meet statutory mandates.

    Response: NMFS has not yet completed mortality and serious injury estimates for 2014 and provides the information on observed takes only for context on our decision to retain the five-year look-back in the computation of M/SI for comparison to PBR. NMFS is evaluating the effectiveness of the False Killer Whale Take Reduction Plan (FKWTRP) in accordance with the monitoring strategy that was developed in consultation with the False Killer Whale Take Reduction Team.

    Comment 40: The reports of M/SI for the California stock of northern fur seal (Table 1) have an apparent inconsistency that is unexplained. Table 1 in the prior SAR provided information on observed mortality for the years 2007-2011. The observed mortality and serious injury for 2011 is said to be 1. However, in Table 1 in the current draft SAR, the observed fishery-related mortality and serious injury listed for 2011 (providing data for 2009-2013), lists observed mortality for the year 2011 as 2. Revised text explaining the table states that “[t]wo of the fishery-related deaths (one in an unidentified fishing net in February 2009 and one in trawl gear in April 2011) were also assigned to the Eastern Pacific stock of northern fur seals.” However, this does not make it clear why the 2009 mortality remained unchanged but the 2011 mortality increased.

    Response: Data on human-caused M/SI is derived from many sources, including stranding networks, rehabilitation centers, independent researchers, and observer programs. Occasionally, additional human-caused mortality and serious injury records are incorporated into subsequent reports as databases are reviewed or cases are reassessed. In this case, the change regarding the serious injury record was made and reflected in the draft 2015 SAR but had no effect on the strategic status of the stock.

    Comment 41: The assumed net productivity of the California/Oregon/Washington stock of sperm whales inappropriately ignores at least five peer-reviewed estimates of sperm whale growth rates, all of which fall in the range of 0.6% to 0.96% per year. Also, the conclusion that this stock is stable or increasing has no solid evidentiary support. The Moore and Barlow (2014) population estimate for the stock does not achieve the SAR's stated goal of improving the precision of population estimates. Estimates of fishery related mortality of the stock from derelict gear calculated from strandings appear to be ten to twenty times too low, once unobserved mortality and recovery rates are corrected for.

    Response: NMFS did not revise the sperm whale SAR in 2015 and responded to similar comments on the 2014 sperm whale SAR in the Federal Register on August 20, 2015 (80 FR 50599; see response to Comment 21).

    Comment 42: The Moore and Barlow (2014) analysis of the California/Oregon/Washington stock of sperm whales appears to lack the statistical power to detect trends in the population, which elevates risks to cetaceans.

    Response: See response to Comment 41. NMFS will consider and address this comment when we next review this SAR in the future.

    Comment 43: The HLA encourages NMFS to make additional improvements to the draft 2015 false killer whale SAR, by eliminating the five-year look-back period for the false killer whale SAR, and reporting only data generated after the FKWTRP regulations became effective. For example, the draft 2015 SAR should report M/SI values based on 2013 and 2014 data, and the data prior to 2013 should no longer be used because it is no longer part of the best available scientific information.

    Response: The GAMMS (NMFS 2005) suggest that if there have been significant changes in fishery operations that are expected to affect take rates, such as the 2013 implementation of the FKWTRP, the guidelines recommend using only the years since regulations were implemented. However, recent studies (Carretta and Moore 2014) have demonstrated that estimates from a single year of data are biased when take events are rare, as with false killer whales in the Hawaii-based longline fisheries. Further, although the estimated M/SI of false killer whales within the U.S. Economic Exclusion Zone (EEZ) around Hawaii during 2013 (4.1) is below the PBR (9.3), this estimate is within the range of past, pre-take reduction plan (TRP) estimates, so there is not yet sufficient information to determine whether take rates in the fishery have decreased as a result of the TRP. Further take rates from 2014 are among the highest recorded, suggesting TRP measures may not be effective, and the change in fishery operation may not be significant enough to warrant abandoning the five-year averaging period. For these reasons, the strategic status for this stock has been evaluated relative to the most recent five years of estimated mortality and serious injury.

    Comment 44: For a decade, NMFS has reported a M/SI rate for the deep-set fishery that far exceeds PBR for the Hawaii pelagic false killer whale stock (“Pelagic Stock”). However, the best available information suggests that the number of false killer whales in the Hawaii EEZ has not declined during the same time that the supposedly unsustainable M/SI rate was occurring. HLA disagrees with the M/SI levels reported in the draft SAR and with NMFS' conclusion that the vast majority of all fishery interactions with the Pelagic Stock cause injuries that “will likely result in mortality.” If that were the case, then after a decade or more of allegedly unsustainable levels of take, there would be some evidence of a declining Pelagic Stock abundance. No such evidence exists. The draft SAR should expressly recognize this discrepancy, and NMFS should revisit the manner in which it determinesM/SI for false killer whale interactions.

    Response: This comment has been addressed previously (see 78 FR 19446, April 1, 2013, comments 45 and 51; 79 FR 49053, August 18, 2014, comment 26; and 80 FR 50599, August 20, 2015, comment 34). The comment and included footnote contend that the stock abundance has not declined (as opposed to prior year comments that indicated the stock was increasing) in over a decade and attributes this persistence of false killer whales despite high levels of fishery mortality to NMFS' improper assessment of the severity of injuries resulting from fisheries interactions, improper assessment of population abundance and trend, or both. Assessment of injury severity under the NMFS 2012 serious injury policy has been discussed in numerous previous comment responses and is based on the best available science on whether a cetacean is likely to survive a particular type of injury. Further study of false killer whales would certainly better inform the assigned outcomes; but, until better data becomes available, the standard established in the NMFS 2012 policy on distinguishing serious from non-serious injuries will stand.

    Further, assessments of pelagic false killer whale population trend are inappropriate, as the entire stock range is unknown, but certainly extends beyond the Hawaii EEZ, such that the available abundance estimates do not reflect true population size. A robust assessment of population trend would require assessment of environmental variables that influence false killer whale distribution and the proportion of the population represented within the survey area during each survey period. Finally, many years of unsustainable take does not automatically lead to the conclusion that the population is declining. PBR was designed to provide a benchmark, in the face of uncertainty about marine mammal populations, below which human-caused mortalities would not reduce the population beyond its OSP size, which is defined as the abundance where there is “the greatest net annual increment in population numbers or biomass resulting from additions to the population due to reproduction and/or growth less losses due to natural mortality.” The benchmark does not consider whether a population is declining, as this is very hard to prove, particularly for population abundance estimates with low precision.

    Comment 45: HLA incorporates by reference its more specific comments on the draft 2014 SAR related to the 2010 Hawaiian Islands Cetacean Ecosystem and Assessment Survey (HICEAS) and the assumptions made by NMFS based upon the data from that survey. In addition, HLA emphasizes its repeated requests that NMFS publicly disclose information regarding the acoustic data acquired in the 2010 HICEAS survey. Substantial acoustic data was acquired during that survey, but NMFS still has not provided any meaningful analysis of that data or, for example, any basic indication of how many false killer whale vocalizations have been identified in the acoustic data. The acoustic data from the 2010 HICEAS survey contains information directly relevant to false killer whale abundance, and it must be analyzed by NMFS and reported in the false killer whale SAR, which must be based on the best available scientific information.

    Response: Analysis of the acoustic data is a labor intensive and time-consuming process, particularly as automated methods for detection, classification, and localization are still improving. There were many changes in array hardware during the survey, further complicating streamlined analyses of these data. Portions of the data have been analyzed to verify species identification, assess sub-group spatial arrangements, or other factors. A full-scale analyses of this dataset for abundance is likely not appropriate, though NMFS is further evaluating this in light of planning for upcoming HICEAS surveys.

    Comment 46: The draft SAR assigns a recovery factor of 0.5 to the Pelagic Stock of false killer whales, which is the value typically assigned to depleted or threatened stocks, or stocks of unknown status, with a mortality estimate CV of 0.3 or less. However, the Pelagic Stock is not depleted or threatened, nor is its status unknown. Since NMFS began estimating Hawaii false killer whale abundance in 2000, as more data have been obtained, more whales have been observed and the population estimates have increased from 121 in 2000 (a recognized underestimate for all false killer whales in the EEZ) to 268 in 2005, 484 in 2007, 1,503 in 2013, and 1,540 at present. Similarly, the incidence of fishery interactions with the Pelagic Stock has not decreased, nor has the rate of false killer whale depredation of fishing lines decreased (if anything, it has increased). All of the available data contradict any hypothesis that false killer whales in the Hawaii EEZ are decreasing. This status should be accurately reflected with a recovery factor that is greater than 0.5 (i.e., closer to 1.0 than to 0.5).

    Response: This comment has been addressed previously (see 80 FR 50599, August 20, 2015, comment 36). Reanalysis of existing datsets to derive more precise estimates does not consititute an increase in population size. There are two EEZ-wide estimates of abundance and the current status of pelagic false killer whales is unknown. This population may be reduced given fishing pressures within and outside of the EEZ over several decades. The status of Hawaii pelagic false killer whales is considered unknown because there are no trend data available to evaluate whether the population is increasing, stable, or declining. The recovery factor for Hawaii pelagic false killer whales will remain 0.5, as indicated, for a stock with a CV for the mortality and serious injury rate estimate that is less than or equal to 0.30.

    Comment 47: HLA appreciates that NMFS has now acknowledged that the range of the MHI insular false killer whale stock (“Insular Stock”) should be modified, based upon the best available scientific information. Although the range reported in the draft 2015 SAR is still overbroad (i.e., it encompasses areas where no Insular Stock animals have been observed), it is a much more accurate representation of the Insular Stock's range than has been reported in previous SARs.

    Response: NMFS reassessed the stock range of all three stocks of false killer whales in Hawaii based on all data available. NMFS will consider future stock boundary revisions if new data become available that indicate the revised stock boundary should be reconsidered.

    Comment 48: As with past draft SARs, the draft 2015 SAR attributes M/SI by the deep-set fishery to the Insular Stock. For at least the following two reasons, these attributions are inappropriate and contrary to the best available scientific information. First, there has never been a confirmed interaction between the deep-set fishery and an animal from the Insular Stock. Although there is anecdotal evidence of Insular Stock interactions with nearshore shortline fisheries and other small-scale fishing operations, none of these are documented or reliably reported and none implicate the Hawaii-based longline fisheries, which have been excluded from nearshore fishing grounds for many years.

    Second, as NMFS recognizes in the draft 2015 SAR, the range for the Insular Stock is, appropriately, much smaller than was previously assumed by NMFS. When this new range is taken into account, along with the TRP-based year-round closure of the area to the north of the MHI, there is only a very, very small area in which longline fishing may overlap with the assumed range of the Insular Stock. No false killer whale interaction by the deep-set fishery has ever occurred in this area. It is therefore incorrect, and contrary to the best available information, to state that the deep-set fishery, as currently regulated, is “interacting with” the Insular Stock.

    Response: The commenter is correct that using the new MHI insular false killer whale stock range and the longline exclusion area required under the FKWTRP, there is little overlap between the MHI insular stock and the longline fishery. However, there are still small areas of overlap and fishing effort in this area is non-zero. It is rare that the stock-identity of a hooked or entangled whale can be determined, and as such NMFS follows the GAMMS and apportions those takes of unknown stock to all stocks within the fishing area. NMFS has carried out this apportionment based on the distribution of fishing effort in areas of overlap between stocks and the fishery.

    Comment 49: The substantial revision to the minimum population estimate for the Insular Stock is unexplained, and NMFS' assumption that the Insular Stock has declined is speculative.

    Response: NMFS makes no assumption that MHI insular stock abundance has declined in the last year (see response to Comment 38). The minimum estimate reflects the number of individuals enumerated during the stated period and may reflect not only changes in actual population abundance, but also changes in encounter rates due to survey location or animal distribution.

    Comment 50: The proration assumptions used in the draft 2015 SAR do not reflect the best available scientific information. The 2015 draft SAR, like previous SARs, continues to allocate additional false killer whale interactions to the fisheries in a manner that lacks a rational basis. HLA incorporates by reference its objections to NMFS's attributions for “blackfish” interactions and for interactions in which no injury determination has been made. In addition, NMFS's new method for allocating false killer whale interactions within the EEZ is not appropriate for interactions that occur with the shallow-set fishery, which has 100% observer coverage. All shallow-set fishery interactions should be attributed based only on the location of the interaction because those interactions are not extrapolated.

    Response: False killer whale bycatch proration reflects the best available information on the species and injury status of cetaceans observed hooked or entangled in the longline fishery. First, NMFS prorates injuries with a status of “cannot be determined” (CBD) according to the ratio of known serious and non-serious injuries. To treat all CBD cases as non-serious would be a clear under-representation of total M/SI within the fishery. This proration is supported within the GAMMS, judged by NMFS, and supported by external peer-review, as the best approach for appropriately accounting for injuries whose injury status cannot be determined based on the information provided by the observer. Second, when a species code of “unidentified blackfish” has been assigned to an interaction by the NMFS Pacific Islands Regional Office Observer Program, the Program has determined that the species identity is either false killer whale or short-finned pilot whale. This species assignment is much more specific than “unidentified cetacean” (there are 52 cetacean species). Because the species identity is known within two possible candidates, NMFS has used all other interactions with those two species to develop a proration model for assigning these blackfish interactions to be false killer whales or short-finned pilot whales. All available interaction data inform the proration scheme. Cetacean interactions with a species identity of “unidentified cetacean” are not currently prorated to any specific species and are therefore not included in any assessment of mortality and serious injury.

    NMFS appreciates that the explanation for the proration of shallow-set fishery interactions was not entirely clear within the draft SAR and has updated the language to be more explicit about the treatment of interactions within that fishery. Shallow-set fishery interactions have not been extrapolated or prorated among regions. Shallow-set fishery interactions are only prorated among stocks if the take occurred within an overlap zone.

    Comments on Alaska Regional Reports

    Comment 51: Among its comments on the draft 2014 SARs, the Commission recommended that NMFS: (1) “provide an update on the status of the development of a statewide program for monitoring subsistence hunting and harvests,” and (2) “[adjust] the language in the SARs . . . to reflect these efforts and address the concerns about [the] shortcoming[s]” with regard to reporting subsistence harvests. The Commission recognizes and appreciates the corresponding updates made by NMFS to the draft 2015 SARs for ringed, ribbon, and bearded seals, and encourages NMFS to continue to provide updated information wherever it is available, even if only for a limited number of villages or a subset of years. In addition, the Commission recommends that NMFS pursue the funding necessary for more comprehensive surveys of native harvests of marine mammals. The Commission is open to providing what support it can to NMFS' survey efforts and to helping address the lack of funding for such a program.

    Response: NMFS recently conducted a protected species science program review of the Alaska Fisheries Science Center (AFSC). The review generated several recommendations. Recommendation 1.6 directs NMFS to pursue support for bycatch and harvest monitoring in particularly risky fisheries or regions. The AFSC response notes that monitoring harvest levels is currently unfunded, and while resources are limited the AFSC will work with the NMFS Alaska Regional Office to develop a joint list of priorities for understanding harvest levels so both entities can solicit additional resources and coordinate to achieve this objective. We welcome the opportunity to collaborate with other organizations, including the Commission, who might have funding to support this critical information need.

    Comment 52: In the draft 2014 SAR for the North Pacific stock of right whales, NMFS has removed the following statement at the end of the PBR section: “Regardless of the PBR level, because this species is listed under the Endangered Species Act and no negligible impact determination has been made, no human-caused takes of this population are authorized; PBR for this stock is 0.” Elsewhere the report states that the eastern stock of North Pacific right whales “is currently the most endangered stock of large whales in the world for which an abundance estimate is available.” In addition, NMFS acknowledges that, given documented threats to North Atlantic right whales, North Pacific right whales are at risk of entanglement in fishing gear and ship strike, and that because of limited information on the population, and limited stranding program coverage in Alaska, these risks cannot be easily quantified. The calculated PBR of 0.05 for this stock suggests that the population could sustain one take in twenty years. However, only one-third of the population of approximately 30 individuals is female; therefore, the loss of just one female would have serious consequences for population recovery. Given the status of the population, the risks it faces, and the extreme uncertainty about the magnitude of those risks, the Commission recommends that NMFS replace the statement above with a statement that recognizes that the stock cannot sustain any losses and therefore PBR should be set at zero.

    Response: Pursuant to section 117 of the MMPA, NMFS has included an estimate of the stock's PBR in the SAR. However, this calculated PBR is considered unreliable because the stock's population dynamics do not conform to underlying assumptions about the population growth model for marine mammals in the PBR equation. Therefore, we will add the following sentence to the end of the PBR section in the final 2015 North Pacific right whale SAR: “However, because the North Pacific right whale population is far below historical levels and considered to include less than 30 mature females, the calculated value for PBR is considered unreliable.”

    Comment 53: We disagree with the draft SARs change of PBR for the North Pacific right whale from 0 to 0.05, which would be the equivalent to one take every 20 years because there is no take from this population that will allow the stock to reach its OSP. The low abundance in and of itself may inhibit recovery. One example is that Pacific right whales rarely have epibiotic barnacles, possibly because the barnacles have declined at the same time as the whales; and, thus, the whales have now lost protection that barnacles offered from killer whale attacks. The low estimated minimum abundance (25.7) for this population dictates that there is no take level that will not negatively affect recovery; thus, PBR ought to be zero until the population increases to a point where the Allee effect is weak or non-existent. NMFS' reliance on a purely quantitative definition of PBR leads to illogical results because PBR will essentially never be calculated to be zero unless the minimum population estimate is zero. NMFS recognized as much in the 2014 SAR when it assigned a PBR of 0, irrespective of the result of the calculation, because the species is listed under the ESA, no negligible impact determination has been made, and no human-caused takes of this population were authorized. And NMFS's treatment of PBR for North Pacific right whales is entirely inconsistent with its approach for North Atlantic right whales, which were assigned a PBR of 0 when the minimum population estimate was 345 individuals, because of the significant threat of extinction facing the population.

    Response: See response to Comment 52.

    Comment 54: In general, the SARs' estimation of animals being killed or seriously injured in commercial fisheries is inadequate, and it is misleading to assume no serious injury of mortality occurs where a fishery has not been observed. The Alaska SRG noted that the federally-managed fisheries generally provide estimates of marine mammal takes but that state-managed nearshore fisheries, “especially those using gillnets, operate in areas used by large numbers of marine mammals and use gear types known to catch mammals, turtles, and seabirds worldwide.” The SRG notes that more than half of the state-managed Category II fisheries that were to be observed through the Alaska Marine Mammal Observer Program have not been observed at all. It is vital that NMFS meet its obligations to provide updated information on fisheries interacting with the estimated level of mortality and serious injury to which stocks are subjected by commercial fisheries.

    Response: NMFS acknowledges the need to provide updated estimations of marine mammal M/SI for fisheries that interact with marine mammals. While many federal fisheries in Alaska are regularly observed, with marine mammal M/SI data collected, the agency does not have sufficient resources to fully monitor all Alaska state-managed salmon gillnet fisheries. With the implementation of the 1994 amendments to the MMPA, the process for classifying commercial fisheries under the annual List of Fisheries was revised to take into account each marine mammal stock's PBR level relative to a fishery's M/SI from each marine mammal stock. NMFS has maintained in the two decades since then that observer data is the most reliable source of M/SI estimates. Although some anecdotal information on marine mammal M/SI does come from stranding and fishermen's self-reports, that information is not considered as comprehensive or statistically reliable as observer data.

    With implementation of section 118 of the MMPA amendments in 1994, eight Alaska state-managed salmon gillnet fisheries were classified as Category II fisheries (per 50 CFR 229.2), despite a lack of observer data on incidental M/SI or in some cases even anecdotal take reports, to allow for future collection of statistically reliable M/SI data. This action was based on the understanding that gillnets are known to incidentally catch marine mammals in the rest of the United States and throughout the world. Of those eight fisheries, five fisheries have been observed, once each for a two-year period (although the Southeast Alaska salmon drift gillnet fishery has been observed in only a portion of its range to date). The remaining three unobserved fisheries from that original list of eight are the Bristol Bay salmon set and drift gillnet fisheries and the Alaska Peninsula salmon set gillnet fishery. Three other salmon gillnet fisheries were observed prior to 1994 and have not been observed again. NMFS acknowledges that this level of coverage since the 1994 MMPA amendments does not adequately meet the need for robust, timely M/SI estimates that the section 118 framework for fishery-marine mammal interactions requires. If a fishery has previously been observed, but is not currently observed, the estimates derived from available observer data are considered the best available until they can be updated. If a fishery has never been observed, the level of marine mammal M/SI is considered unknown. The agency does not assume that the level of M/SI is zero if a fishery is not observed. Where necessary, we will clarify this in the Alaska SARs.

    As additional resources become available, NMFS will seek to provide more robust observer coverage of the state-managed Category II gillnet fisheries in Alaska, including gillnet fisheries that have never been observed, as well as to update existing M/SI estimates. However, NMFS is reviewing ways to assess the marine mammal M/SI in these fisheries in a more economical manner.

    Comment 55: While we applaud the recent research into harbor porpoises in Southeast Alaska, it appears that too little data collection has occurred to prevent undetected population declines. We request with urgency that: (1) NMFS redefine the SE AK harbor porpoise stock into two stocks—one at Glacier Bay/Icy Strait and one near Wrangell and Zarembo Islands, and (2) require observer coverage in the salmon and Pacific herring fisheries, which may be contributing to the decline in the Wrangell and Zarembo stock. The draft SARs note that Dahlheim et al. (2015) suggest that these areas may represent different subpopulations and incidental takes from commercial fisheries are concerning. In this situation, the benefit of the doubt should go to conservation of the marine mammals. We note that Chairman Lowry of the SRG stated that harbor porpoise are at the top of the SRG's list of concerns. We hope that the final SARs can address this concern by identifying two separate stocks of harbor porpoise in Southeast Alaska.

    Response: There are two key issues: Available data and process. Prior to developing the draft 2015 SAR for Southeast Alaska harbor porpoise, Alaska Fisheries Sceince Center (AFSC)'s Marine Mammal Laboratory (MML) staff discussed available information on Southeast Alaska harbor porpoise groups with experts on harbor porpoise on the west coast and in Alaska. The group of experts discussed multiple lines of evidence that might support at least two separate stocks, and they identified additional supporting studies, including genetics and satellite tagging, which would be useful in making this determination. NMFS is supporting such studies as resources are available. In the meantime, NMFS used information provided in Dahlheim et al. (2015) to calculate an Nmin and putative PBR level for the harbor porpoise group in the Wrangell and Zarembo Islands area of the inside waters of Southeast Alaska in the draft 2015 SARs and will be using information in Dahlheim et al. (2015) to calculate an Nmin and putative PBR level for the concentrations of harbor porpoise in the northern and southern regions of the inside waters of Southeast Alaska in the draft 2016 SARs. NMFS will evaluate whether these harbor porpoise groups should be considered “prospective stocks” in future SARs and will continue to review new information on harbor porpoise to assess whether formal designation of multiple stocks in Southeast Alaska is appropriate.

    Identification of a new stock is considered a major change to a SAR and should be proposed in a draft SAR so it has the benefit of being reviewed by the SRG and the public. NMFS does not make a change like this in a final SAR but will consider making this change in a future draft SAR for this stock if the available data support such a change.

    Further, Category II fisheries, including many of the Alaska state-managed gillnet fisheries, are already subject to observer coverage. See response to Comment 29 regarding prioritizing observer coverage and funding.

    Comment 56: NMFS updated the assessment for humpback whale, Central North Pacific stock, based on an unpublished multi-strata model (Wade et al., in review) that, to our knowledge, is not publicly available and thus cannot be commented upon effectively. Peer-reviewed literature should be a primary source of information for SARs.

    Response: Since Wade et al. (in review) has not been published, we have removed the updated population estimates (based on this paper) from the final 2015 Central North Pacific and Western North Pacific humpback whale SARs.

    Comment 57: NMFS has declared a large whale UME because of elevated strandings since May 2015. Through December 1, 2015, there have been 45 large whales stranded, at least eleven of which were fin whales (as of mid-August). The SARs should reflect updated information on the extent of the strandings in order to provide relevant context for the information reported in the SARs.

    Response: We will add information about the Large Whale UME in the western Gulf of Alaska to the draft 2016 Northeast Pacific fin whale, Central North Pacific humpback whale, and Western North Pacific humpback whale SARs.

    Comment 58: The SARs should incorporate known data about spatial and temporal overlap of bowhead whales and Alaska fisheries in order to approximate areas and times of highest risk of entanglements that may go unobserved or unreported. The draft SAR notes a couple of incidents of historical entanglements of bowhead whales in commercial fisheries in Alaska, but should be updated to acknowledge the spatial overlap of certain fisheries with this stock, per Citta et al. (2014).

    Response: NMFS has updated the Fisheries Information section of the final 2015 Western Arctic bowhead whale SAR to incorporate a reference to Citta et al.'s (2014) findings on the stock's spatial and temporal overlap with commercial pot fisheries in the Bering Sea.

    Comment 59: The discussion of habitat concerns for bowhead whale should be updated to recognize the work of Blackwell et al. (2015), which showed that bowhead whales exhibit different behavioral responses depending on noise thresholds when in proximity to seismic operations. Calling rates first increase when the initial airgun pulses are detected, then decrease rapidly when airgun sounds exceed a threshold.

    Response: NMFS has updated the Habitat Concerns section of the final 2015 Western Arctic bowhead whale SAR with a reference to Blackwell et al.'s (2015) study.

    Dated: June 9, 2016. Donna S. Wieting, Director, Office of Protected Resources, National Marine Fisheries Service.
    [FR Doc. 2016-14015 Filed 6-13-16; 8:45 am] BILLING CODE 3510-22-P
    DEPARTMENT OF COMMERCE National Telecommunications and Information Administration Commerce Spectrum Management Advisory Committee AGENCY:

    National Telecommunications and Information Administration, U.S. Department of Commerce.

    ACTION:

    Notice; reopening of application window for Advisory Committee nominations.

    SUMMARY:

    Through this Notice, the National Telecommunications and Information Administration (NTIA) is reopening an application window for nominations to the Commerce Spectrum Management Advisory Committee (CSMAC). On March 29, 2016, NTIA published a Notice seeking nominations to the CSMAC with a deadline of May 13, 2016. In reopening this application window, NTIA seeks to expand the pool of applicants and best ensure the composition of the committee reflects balanced points of view.

    DATES:

    Applications must be postmarked or electronically transmitted to the address below on or before June 24, 2016.

    ADDRESSES:

    Persons may submit applications to David J. Reed, Designated Federal Officer, by email to [email protected] or by U.S. mail or commercial delivery service to Office of Spectrum Management, National Telecommunications and Information Administration, 1401 Constitution Avenue NW., Room 4600, Washington, DC 20230.

    FOR FURTHER INFORMATION CONTACT:

    David J. Reed at (202) 482-5955 or [email protected]

    SUPPLEMENTARY INFORMATION:

    The CSMAC was established and chartered by the Department of Commerce under the Federal Advisory Committee Act (FACA), 5 U.S.C. App. 2, and pursuant to Section 105(b) of the National Telecommunications and Information Administration Organization Act, as amended, 47 U.S.C. 904(b). The Department of Commerce re-chartered the CSMAC on March 3, 2015, for a two-year period. More information about the CSMAC may be found at http://www.ntia.doc.gov/category/csmac.

    On March 29, 2016, NTIA published a Notice in the Federal Register seeking nominations for appointment to the CSMAC. See Commerce Spectrum Management Advisory Committee; Call for Applications, 81 FR 17446 (March 29, 2016), available at http://www.ntia.doc.gov/files/ntia/publications/fr_csmac_applications_call_03292016.pdf. The original application deadline was May 13, 2016.

    Through this Notice, NTIA is reopening the application window for 10 days to expand the pool of applicants and best ensure the composition of the committee reflects balanced points of view (e.g., past professional or academic accomplishments, industry sector representation, and educational background). All other requirements for appointment to the CSMAC appear in the SUPPLEMENTARY INFORMATION section of the March 29, 2016, Notice.

    Dated: June 8, 2016. Kathy D. Smith, Chief Counsel, National Telecommunications and Information Administration.
    [FR Doc. 2016-13971 Filed 6-13-16; 8:45 am] BILLING CODE 3510-10-P
    COMMODITY FUTURES TRADING COMMISSION Agency Information Collection Activities: Notice of Intent To Renew Collection 3038-0099, Process for a Swap Execution Facility or Designated Contract Market To Make a Swap Available To Trade AGENCY:

    Commodity Futures Trading Commission.

    ACTION:

    Notice.

    SUMMARY:

    The Commodity Futures Trading Commission (CFTC) is announcing an opportunity for public comment on the proposed collection of certain information by the agency. Under the Paperwork Reduction Act (“PRA”), Federal agencies are required to publish notice in the Federal Register concerning each proposed collection of information and to allow 60 days for public comment. This notice solicits comments on the process for a designated contract market (DCM) or a swap execution facility (SEF) to make a swap available to trade and therefore subject to the trade execution requirement pursuant to the Commodity Exchange Act (“CEA”). This process imposes rule filing requirements on a DCM or a SEF that wishes to submit a swap as available to trade.

    DATES:

    Comments must be submitted on or before August 15, 2016.

    ADDRESSES:

    You may submit comments, identified by “Renewal of Collection Pertaining to Process for a Swap Execution Facility or Designated Contract Market to Make a Swap Available to Trade” by any of the following methods:

    • The Agency's Web site, at http://comments.cftc.gov/. Follow the instructions for submitting comments through the Web site.

    Mail: Christopher Kirkpatrick, Secretary of the Commission, Commodity Futures Trading Commission, Three Lafayette Centre, 1155 21st Street NW., Washington, DC 20581.

    Hand Delivery/Courier: Same as Mail above.

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

    Please submit your comments using only one method.

    FOR FURTHER INFORMATION CONTACT:

    Roger Smith, Special Counsel, Division of Market Oversight, Commodity Futures Trading Commission, (202) 418-5344; email: [email protected], and refer to OMB Control No. 3038-0099.

    SUPPLEMENTARY INFORMATION:

    Under the PRA, Federal agencies must obtain approval from the Office of Management and Budget (OMB) for each collection of information they conduct or sponsor. “Collection of Information” is defined in 44 U.S.C. 3502(3) and 5 CFR 1320.3 and includes agency requests or requirements that members of the public submit reports, keep records, or provide information to a third party. Section 3506(c)(2)(A) of the PRA, 44 U.S.C. 3506(c)(2)(A), requires Federal agencies to provide a 60-day notice in the Federal Register concerning each proposed collection of information before submitting the collection to OMB for approval. To comply with this requirement, the CFTC is publishing notice of the proposed collection of information listed below.

    Title: Process for a Swap Execution Facility or Designated Contract Market to Make a Swap Available to Trade (OMB Control No. 3038-0099). This is a request for extension of a currently approved information collection.

    Abstract: The collection of information is needed to help determine which swaps should be subject to the trade execution requirement under section 2(h)(8) of the Commodity Exchange Act pursuant to Section 723 of the Dodd-Frank Wall Street Reform and Consumer Protection Act. A SEF or DCM that submits a determination that a swap is available to trade must address at least one of several factors to demonstrate that the swap is suitable for trading pursuant to the trade execution requirement. The Commission uses the collection of information to facilitate the application of the trade execution requirement and the requirements associated with methods of execution under parts 37 and 38 of the Commission's regulations. With respect to the collection of information, the CFTC invites comments on:

    • Whether the proposed collection of information is necessary for the proper performance of the functions of the Commission, including whether the information will have a practical use;

    • The accuracy of the Commission's estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used;

    • Ways to enhance the quality, usefulness, and clarity of the information to be collected; and

    • Ways to minimize the burden of collection of information on those who are to respond, including through the use of appropriate automated electronic, mechanical, or other technological collection techniques or other forms of information technology; e.g., permitting electronic submission of responses.

    All comments must be submitted in English, or if not, accompanied by an English translation. Comments will be posted as received to http://www.cftc.gov. You should submit only information that you wish to make available publicly. If you wish the Commission to consider information that you believe is exempt from disclosure under the Freedom of Information Act, a petition for confidential treatment of the exempt information may be submitted according to the procedures established in § 145.9 of the Commission's regulations.1

    1 17 CFR 145.9.

    The Commission reserves the right, but shall have no obligation, to review, pre-screen, filter, redact, refuse or remove any or all of your submission from http://www.cftc.gov that it may deem to be inappropriate for publication, such as obscene language. All submissions that have been redacted or removed that contain comments on the merits of the Information Collection Request will be retained in the public comment file and will be considered as required under the Administrative Procedure Act and other applicable laws, and may be accessible under the Freedom of Information Act.

    Burden Statement: Sections 37.10 and 38.12 of the Commission's regulations result in information collection requirements within the meaning of the PRA. This regulation permits a SEF or DCM to submit a determination that a swap is available to trade to the Commission via filing procedures set forth in part 40 of the Commission's regulations. The Commission estimates the burden of reviewing the prescribed factors and data to make a determination for this collection to be 16 hours per response.

    Respondents/Affected Entities: SEFs, DCMs.

    Estimated number of respondents: 5.2

    2 The CFTC had estimated 50 respondents, i.e., registered entities, that would file determinations with the CFTC. 78 FR 33618. The CFTC is revising this estimated number of respondents based on the number of determinations that have been filed since the effective date of the rule. In the fall of 2013, four SEFs and one DCM self-certified rules, pursuant to § 40.6 filing procedures, based upon each SEF's or DCM's respective determinations that certain credit default swaps (“CDS”) and interest rate swap contracts (“IRS”) were made available to trade.

    Estimated total annual burden on respondents: 80 hours.

    Frequency of collection: On occasion.

    Authority:

    44 U.S.C. 3501 et seq.

    Dated: June 9, 2016. Robert N. Sidman, Deputy Secretary of the Commission.
    [FR Doc. 2016-14029 Filed 6-13-16; 8:45 am] BILLING CODE 6351-01-P
    BUREAU OF CONSUMER FINANCIAL PROTECTION [Docket No: CFPB-2016-0030] Agency Information Collection Activities: Submission for OMB Review; Comment Request AGENCY:

    Bureau of Consumer Financial Protection.

    ACTION:

    Notice and request for comment.

    SUMMARY:

    In accordance with the Paperwork Reduction Act of 1995 (PRA), the Bureau of Consumer Financial Protection (Bureau) is requesting to renew the Office of Management and Budget (OMB) approval for an existing information collection titled, “Generic Information Collection Plan for the Office of Intergovernmental Affairs Outreach Activities.”

    DATES:

    Written comments are encouraged and must be received on or before July 14, 2016 to be assured of consideration.

    ADDRESSES:

    You may submit comments, identified by the title of the information collection, OMB Control Number (see below), and docket number (see above), by any of the following methods:

    Electronic: http://www.regulations.gov. Follow the instructions for submitting comments.

    OMB: Office of Management and Budget, New Executive Office Building, Room 10235, Washington, DC 20503 or fax to (202) 395-5806. Mailed or faxed comments to OMB should be to the attention of the OMB Desk Officer for the Bureau of Consumer Financial Protection. Please note that comments submitted after the comment period will not be accepted. In general, all comments received will become public records, including any personal information provided. Sensitive personal information, such as account numbers or social security numbers, should not be included.

    FOR FURTHER INFORMATION CONTACT:

    Documentation prepared in support of this information collection request is available at www.reginfo.gov (this link active on the day following publication of this notice). Select “Information Collection Review,” under “Currently under review, use the dropdown menu “Select Agency” and select “Consumer Financial Protection Bureau” (recent submissions to OMB will be at the top of the list). The same documentation is also available at http://www.regulations.gov. Requests for additional information should be directed to the Consumer Financial Protection Bureau (Attention: PRA Office), 1700 G Street NW., Washington, DC 20552, (202) 435-9575, or email: [email protected] Please do not submit comments to this email box.

    SUPPLEMENTARY INFORMATION:

    Title of Collection: Generic Information Collection Plan for the Office of Intergovernmental Affairs Outreach Activities.

    OMB Control Number: 3170-0041.

    Type of Review: Extension without change of a currently approve collection.

    Affected Public: State, local, or Tribal governments.

    Estimated Number of Annual Respondents: 400.

    Estimated Total Annual Burden Hours: 3,200.

    Abstract: The Office of Intergovernmental Affairs (IGA) at the Bureau requests OMB's approval for an extension without change this generic information collection plan (GICP) in order to collect information from State, local, and tribal governments. These governments interact closely with consumers and are critical partners in promoting transparency and competition in the consumer financial products marketplace, eliminating unfair and unlawfully discriminatory practices, and enforcing consumer financial laws. The outreach activities performed by IGA will collect low-burden, non-generalizable information through this GICP on trends in consumer financial markets, enforcement actions, regulatory and supervisory issues, and consumer needs at the State, local, and tribal levels. Most of this information will be in the form of government representatives providing impressions and overviews of their activities. Information will be collected on an occasional and voluntary basis from State, local, and tribal governments and from their respective trade associations.

    Request for Comments: The Bureau issued a 60-day Federal Register notice on March 28, 2016 (81 FR 17146). Comments were solicited and continue to be invited on: (a) Whether the collection of information is necessary for the proper performance of the functions of the Bureau, including whether the information will have practical utility; (b) The accuracy of the Bureau's estimate of the burden of the collection of information, including the validity of the methods and the assumptions used; (c) Ways to enhance the quality, utility, and clarity of the information to be collected; and (d) Ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques or other forms of information technology. Comments submitted in response to this notice will be summarized and/or included in the request for OMB approval. All comments will become a matter of public record.

    Dated: June 8, 2016. Darrin A. King, Paperwork Reduction Act Officer, Bureau of Consumer Financial Protection.
    [FR Doc. 2016-14024 Filed 6-13-16; 8:45 am] BILLING CODE 4810-AM-P
    BUREAU OF CONSUMER FINANCIAL PROTECTION [Docket No: CFPB-2016-0031] Agency Information Collection Activities: Comment Request AGENCY:

    Bureau of Consumer Financial Protection.

    ACTION:

    Notice and request for comment.

    SUMMARY:

    In accordance with the Paperwork Reduction Act of 1995 (PRA), the Bureau of Consumer Financial Protection (Bureau) is requesting to renew the Office of Management and Budget (OMB) approval for an existing information collection titled, “Truth in Savings (Regulation DD) 12 CFR 1030.”

    DATES:

    Written comments are encouraged and must be received on or before August 15, 2016 to be assured of consideration.

    ADDRESSES:

    You may submit comments, identified by the title of the information collection, OMB Control Number (see below), and docket number (see above), by any of the following methods:

    Electronic: http://www.regulations.gov. Follow the instructions for submitting comments.

    Mail: Consumer Financial Protection Bureau (Attention: PRA Office), 1700 G Street NW., Washington, DC 20552.

    Hand Delivery/Courier: Consumer Financial Protection Bureau (Attention: PRA Office), 1275 First Street NE., Washington, DC 20002.

    Please note that comments submitted after the comment period will not be accepted. In general, all comments received will become public records, including any personal information provided. Sensitive personal information, such as account numbers or social security numbers, should not be included.

    FOR FURTHER INFORMATION CONTACT:

    Documentation prepared in support of this information collection request is available at www.regulations.gov. Requests for additional information should be directed to the Consumer Financial Protection Bureau, (Attention: PRA Office), 1700 G Street NW., Washington, DC 20552, (202) 435-9575, or email: [email protected] Please do not submit comments to this mailbox.

    SUPPLEMENTARY INFORMATION:

    Title of Collection: Truth in Savings (Regulation DD) 12 CFR 1030.

    OMB Control Number: 3170-0004.

    Type of Review: Extension without change of a currently approved collection.

    Affected Public: Private sector (non-credit union depository institutions).

    Estimated Number of Respondents: 129.

    Estimated Total Annual Burden Hours: 573,008.

    Abstract: Consumers rely on the disclosures required by The Truth in Savings Act (TISA) and Regulation DD to facilitate informed decision-making regarding deposit accounts offered at depository institutions. Without this information, consumers would be severely hindered in their ability to assess the true costs and terms of the deposit accounts offered. Federal agencies and private litigants use the records to ascertain whether accurate and complete disclosures of depository accounts have been provided to consumers. This information also provides the primary evidence of law violations in TISA enforcement actions brought by the Bureau. Without the Regulation DD recordkeeping requirement, the Bureau's ability to enforce TISA would be significantly impaired.

    Request for Comments: Comments are invited on: (a) Whether the collection of information is necessary for the proper performance of the functions of the Bureau, including whether the information will have practical utility; (b) The accuracy of the Bureau's estimate of the burden of the collection of information, including the validity of the methods and the assumptions used; (c) Ways to enhance the quality, utility, and clarity of the information to be collected; and (d) Ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques or other forms of information technology. Comments submitted in response to this notice will be summarized and/or included in the request for OMB approval. All comments will become a matter of public record.

    Dated: June 7, 2016. Darrin A. King, Paperwork Reduction Act Officer, Bureau of Consumer Financial Protection.
    [FR Doc. 2016-14025 Filed 6-13-16; 8:45 am] BILLING CODE 4810-AM-P
    DEPARTMENT OF DEFENSE Department of the Army [Docket ID: USA-2015-0019] Proposed Collection; Comment Request AGENCY:

    Deputy Chief of Staff, G-1, Technology and Business Architecture Integration Directorate, Army Library Program, DoD.

    ACTION:

    Notice.

    SUMMARY:

    In compliance with the Paperwork Reduction Act of 1995, the Deputy Chief of Staff, G-1, Technology and Business Architecture Integration Directorate, Army Library Program announces a proposed public information collection and seeks public comment on the provisions thereof. Comments are invited on: Whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information shall have practical utility; the accuracy of the agency's estimate of the burden of the proposed information collection; ways to enhance the quality, utility, and clarity of the information to be collected; and ways to minimize the burden of the information collection on respondents, including through the use of automated collection techniques or other forms of information technology.

    DATES:

    Consideration will be given to all comments received by August 15, 2016.

    ADDRESSES:

    You may submit comments, identified by docket number and title, by any of the following methods:

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

    Mail: Department of Defense, Office of the Deputy Chief Management Officer, Directorate for Oversight and Compliance, 4800 Mark Center Drive, Mailbox #24, Alexandria, VA 22350-1700.

    Instructions: All submissions received must include the agency name, docket number and title for this Federal Register document. The general policy for comments and other submissions from members of the public is to make these submissions available for public viewing on the Internet at http://www.regulations.gov as they are received without change, including any personal identifiers or contact information.

    Any associated form(s) for this collection may be located within this same electronic docket and downloaded for review/testing. Follow the instructions at http://www.regulations.gov for submitting comments. Please submit comments on any given form identified by docket number, form number, and title.

    FOR FURTHER INFORMATION CONTACT:

    To request more information on this proposed information collection or to obtain a copy of the proposal and associated collection instruments, please write to the Deputy Chief of Staff, G-1, Technology and Business Architecture Integration Directorate, ATTN: DAPE-TBL, 300 Army Pentagon, Washington, DC 20310-0300; or call Army Library Program at 703-695-5401.

    SUPPLEMENTARY INFORMATION:

    Title; Associated Form; and OMB Number: Library Borrowers'/Users' Profile Files; General Library Information System Registration Form DA Form 7745; OMB Control Number: 0702-XXXX.

    Needs and Uses: The information collection requirement is necessary to identify individuals authorized to borrow library materials from Army libraries; to ensure that all Army library property is returned and individual's account is cleared, and to provide librarian useful information for selecting, ordering, and meeting user requirements; to comply with the Children's Internet Protection Act and to provide authentication for borrowed electronic resources (for example, e-books, e-journals).

    Affected Public: Individuals or Households and Federal Government.

    Annual Burden Hours: 9,750.

    Number of Respondents: 39,000.

    Responses per Respondent: 1.

    Annual Responses: 39,000.

    Average Burden per Response: 15 minutes.

    Frequency: One Time.

    Respondents are Army Family members, Army retirees, DoD civilians, DoD Contractors and authorized DoD personnel who register at Army installation's Morale, Welfare and Recreation (MWR) libraries or other Army libraries in order to check out print, audio-visual, and/or electronic materials. Army MWR libraries collect name, address, phone number, DoD ID number, rank, date of birth, and email address in order to identify individuals authorized to borrow library materials, to ensure that all library property is returned, and the individual's account is cleared. As there are over 500,000 registered borrowers/users in the MWR General Library Information System (GLIS), several identifiers are needed to match the record with the person requesting service. During registration, library borrowers agree to be responsible for replacement or reimbursement for lost or damaged materials borrowed by themselves or authorized Family members using DA Form 7745. If the responsible party does not replace or reimburse the library, AR 735-17 authorizes the library to collect the cost of the item. For service members, the Defense Finance and Accounting Services (DFAS) requires at least the last four numbers of the social security number to collect the debt. Other Army libraries collect less types of personal information for the borrower/user profile such as no SSN or no DoD ID.

    Dated: June 8, 2016. Aaron Siegel, Alternate OSD Federal Register Liaison Officer, Department of Defense.
    [FR Doc. 2016-13979 Filed 6-13-16; 8:45 am] BILLING CODE 5001-06-P
    DEPARTMENT OF DEFENSE Office of the Secretary [Docket ID: DOD-2013-OS-0059] Proposed Collection; Comment Request AGENCY:

    Office of the Under Secretary of Defense for Acquisition, Technology and Logistics, DoD.

    ACTION:

    Notice.

    SUMMARY:

    In compliance with the Paperwork Reduction Act of 1995, the Office of the Under Secretary of Defense for Acquisition, Technology and Logistics announces a proposed public information collection and seeks public comment on the provisions thereof. Comments are invited on: Whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information shall have practical utility; the accuracy of the agency's estimate of the burden of the proposed information collection; ways to enhance the quality, utility, and clarity of the information to be collected; and ways to minimize the burden of the information collection on respondents, including through the use of automated collection techniques or other forms of information technology.

    DATES:

    Consideration will be given to all comments received by August 15, 2016.

    ADDRESSES:

    You may submit comments, identified by docket number and title, by any of the following methods:

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

    Mail: Department of Defense, Office of the Deputy Chief Management Officer, Directorate for Oversight and Compliance, 4800 Mark Center Drive, Mailbox #24, Alexandria, VA 22350-1700.

    Instructions: All submissions received must include the agency name, docket number and title for this Federal Register document. The general policy for comments and other submissions from members of the public is to make these submissions available for public viewing on the Internet at http://www.regulations.gov as they are received without change, including any personal identifiers or contact information.

    Any associated form(s) for this collection may be located within this same electronic docket and downloaded for review/testing. Follow the instructions at http://www.regulations.gov for submitting comments. Please submit comments on any given form identified by docket number, form number, and title.

    FOR FURTHER INFORMATION CONTACT:

    To request more information on this proposed information collection or to obtain a copy of the proposal and associated collection instruments, please write to the Office of the Deputy Assistant Secretary of Defense (Program Support), ATTN: Donna Livingston, 3500 Defense Pentagon, Room 3C152, Washington, DC 30301-3500, or call at 703 692-3032.

    SUPPLEMENTARY INFORMATION:

    Title; Associated Form; and OMB Number: Qualification to Possess Firearms or Ammunition; OMB Control Number 0704-0461.

    Needs and Uses: The information collection requirement is necessary to obtain written acknowledgement by the contract company and its individual Private Security Contractor (PSC) personnel, after investigation of background of PSC personnel by the contractor, verifying that such personnel are not prohibited under U.S. law (18 U.S.C. 922) to possess firearms or ammunition.

    Affected Public: Business or other for profit.

    Annual Burden Hours: 2,344.

    Number of Respondents: 125.

    Responses per Respondent: 75.

    Annual Responses: 9,375.

    Average Burden per Response: 15 minutes.

    Frequency: On occasion.

    Respondents are contract companies and their respective individual Private Security Contractor personnel who must verify that they are not prohibited under U.S. law from possessing firearms. A signed statement is included as part of the arming authorization packet. If the validation is not included in the arming authorization package, individuals reviewing the package and approving the arming authorization cannot be readily assured of the qualifications of the individual requesting arming authorization. Establishing that contractors providing armed security are qualified is essential to insure capable force protection is provided to meet national security imperatives.

    Dated: June 8, 2016. Aaron Siegel, Alternate OSD Federal Register Liaison Officer, Department of Defense.
    [FR Doc. 2016-13970 Filed 6-13-16; 8:45 am] BILLING CODE 5001-06-P
    DEPARTMENT OF DEFENSE Office of the Secretary [Docket ID: DOD-2016-OS-0073] Proposed Collection; Comment Request AGENCY:

    Office of the General Counsel, Standards of Conduct Office, DoD.

    ACTION:

    Notice.

    SUMMARY:

    In compliance with the Paperwork Reduction Act of 1995, the Office of the General Counsel, Standards of Conduct Office, announces a proposed public information collection and seeks public comment on the provisions thereof. Comments are invited on: whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information shall have practical utility; the accuracy of the agency's estimate of the burden of the proposed information collection; ways to enhance the quality, utility, and clarity of the information to be collected; and ways to minimize the burden of the information collection on respondents, including through the use of automated collection techniques or other forms of information technology.

    DATES:

    Consideration will be given to all comments received by August 15, 2016.

    ADDRESSES:

    You may submit comments, identified by docket number and title, by any of the following methods:

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

    Mail: Department of Defense, Office of the Deputy Chief Management Officer, Directorate for Oversight and Compliance, 4800 Mark Center Drive, Mailbox #24, Alexandria, VA 22350-1700.

    Instructions: All submissions received must include the agency name, docket number and title for this Federal Register document. The general policy for comments and other submissions from members of the public is to make these submissions available for public viewing on the Internet at http://www.regulations.gov as they are received without change, including any personal identifiers or contact information.

    Any associated form(s) for this collection may be located within this same electronic docket and downloaded for review/testing. Follow the instructions at http://www.regulations.gov for submitting comments. Please submit comments on any given form identified by docket number, form number, and title.

    FOR FURTHER INFORMATION CONTACT:

    To request more information on this proposed information collection or to obtain a copy of the proposal and associated collection instruments, please write to the Office of the General Counsel, ATTN: Standards of Conduct Office (Mr. Green), 1600 Defense Pentagon, Suite 3E783, Washington, DC 20301-1600.

    SUPPLEMENTARY INFORMATION:

    Title; Associated Form; and OMB Number: Post Government Employment Advice Opinion Request; DD Form 2945; OMB Control Number 0704-0467.

    Needs and Uses: The information collection requirement is necessary to obtain minimal information on which to base an opinion about post Government employment of select former and departing DoD employees seeking to work for Defense Contractors within two years after leaving DoD. The departing or former DoD employee uses the form to organize and provide employment-related information to an ethics official who will use the information to render an advisory opinion to the employee requesting the opinion. The National Defense Authorization of Act for Fiscal Year 2008, Public Law 110-181, section 847, requires that select DoD officials and former DoD officials who, within two years after leaving DoD, expect to receive compensation from a DoD Contractor, shall, before accepting such compensation, request a written opinion regarding the applicability of post-employment restrictions to activities that the official or former official may undertake on behalf of a contractor.

    Affected Public: Individuals or households.

    Annual Burden Hours: 250.

    Number of Respondents: 250.

    Responses per Respondent: 1.

    Annual Responses: 250.

    Average Burden per Response: 60 minutes.

    Frequency: On occasion.

    The National Defense Authorization Act for Fiscal Year 2008, Public Law 110-181, section 847, requires that select DoD officials and former DoD officials who, within two years after leaving DoD, expects to receive compensation from a DoD contractor, shall, before accepting such compensation, request a written opinion regarding the applicability of post-employment restrictions to activities that the official or former official may undertake on behalf of a contractor.

    The departing or former DoD employee uses the form to organize and provide employment-related information to an ethics official who will use the information to provide an opinion to the employee on the applicability of post-Government employment restrictions. The information requested is employment-related and identifying information about the person requesting the opinion.

    Dated: June 8, 2016. Aaron Siegel, Alternate OSD Federal Register Liaison Officer, Department of Defense.
    [FR Doc. 2016-13958 Filed 6-13-16; 8:45 am] BILLING CODE 5001-06-P
    DEPARTMENT OF DEFENSE Office of the Secretary [Docket ID: DoD-2015-OS-0128] Submission for OMB Review; Comment Request ACTION:

    Notice.

    SUMMARY:

    The Department of Defense has submitted to OMB for clearance, the following proposal for collection of information under the provisions of the Paperwork Reduction Act.

    DATES:

    Consideration will be given to all comments received by July 14, 2016.

    FOR FURTHER INFORMATION CONTACT:

    Fred Licari, 571-372-0493.

    SUPPLEMENTARY INFORMATION:

    Title, Associated Form and OMB Number: Science, Mathematics and Research for Transformation (SMART) Program Documents; DD Forms X716, X717, X718, X719, X720, X721, X723, X724, X725, X728, X729, and X731; OMB Control Number 0704-0466.

    Type of Request: Reinstatement, with change, of a previously approved collection for which approval has expired.

    Number of Respondents: 4,300.

    Responses per Respondent: 8.5.

    Annual Responses: 5,875.

    Average Burden per Response: 25.5 hours.

    Annual Burden Hours: 30,200.

    Needs and Uses: The information collection requirement is a statutory and functional necessity to administer the SMART scholarship program. The SMART Program requires a competitive application process. All awardees must be U.S. citizens at the time of application, 18 years or older as of 1 August, 2015, able to participate in summer internships at DoD laboratories, willing to accept post-graduation employment with the DoD, be a current college student in good standing with a minimum GPA of 3.0 on a 4.0 scale (as calculated by the SMART application), pursuing an undergraduate or graduate degree in one of the 19 program funded disciplines, and eligible to obtain and maintain a secret level clearance.

    Affected Public: Individuals or households.

    Frequency: On occasion.

    Respondent's Obligation: Required to obtain or retain benefits.

    OMB Desk Officer: Ms. Jasmeet Seehra.

    Comments and recommendations on the proposed information collection should be emailed to Ms. Jasmeet Seehra, DoD Desk Officer, at [email protected] Please identify the proposed information collection by DoD Desk Officer and the Docket ID number and title of the information collection.

    You may also submit comments and recommendations, identified by Docket ID number and title, by the following method:

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

    Instructions: All submissions received must include the agency name, Docket ID number and title for this Federal Register document. The general policy for comments and other submissions from members of the public is to make these submissions available for public viewing on the Internet at http://www.regulations.gov as they are received without change, including any personal identifiers or contact information.

    DoD Clearance Officer: Mr. Frederick Licari.

    Written requests for copies of the information collection proposal should be sent to Mr. Licari at WHS/ESD Directives Division, 4800 Mark Center Drive, East Tower, Suite 02G09, Alexandria, VA 22350-3100.

    Dated: June 8, 2016. Aaron Siegel, Alternate OSD Federal Register Liaison Officer, Department of Defense.
    [FR Doc. 2016-13951 Filed 6-13-16; 8:45 am] BILLING CODE 5001-06-P
    DEPARTMENT OF DEFENSE Department of the Army, U.S. Army Corps of Engineers Notice of Additional Public Meeting—Draft Environmental Impact Statement for the Lower Yellowstone Intake Diversion Dam Fish Passage Project, Dawson County, Montana AGENCY:

    Department of the Army, U.S. Army Corps of Engineers, DoD.

    ACTION:

    Notice.

    SUMMARY:

    In response to public request, a third public meeting is scheduled for the Draft Environmental Impact Statement for the Lower Yellowstone Intake Diversion Dam Fish Passage Project. The notice of availability and two public meetings published in the Federal Register on June 3, 2016 (81 FR 35754). This third public meeting will be held on Thursday, June 30, 2016, from 5:30 p.m. to 9:00 p.m., at the Lincoln Center, 415 N. 30th Street in Billings, MT. The meeting will begin with an open house at 5:30 p.m., followed by a formal presentation at 6:00 p.m.

    FOR FURTHER INFORMATION CONTACT:

    Ms. Tiffany Vanosdall, U.S. Army Corps of Engineers, 1616 Capitol Ave, Omaha, NE 68102, or [email protected]

    SUPPLEMENTARY INFORMATION:

    None.

    Brenda S. Bowen, Army Federal Register Liaison Officer.
    [FR Doc. 2016-13883 Filed 6-13-16; 8:45 am] BILLING CODE 3720-58-P
    DEPARTMENT OF ENERGY Notice of Public Meeting To Inform the Human Reliability Program AGENCY:

    Office of Environment, Health, Safety and Security, Department of Energy.

    ACTION:

    Notice of public meeting.

    SUMMARY:

    The Department of Energy, Office of Corporate Security Strategy, Analysis and Special Operations, will conduct an Open Meeting June 28-30, 2016, to discuss best practices and recommendations for program improvement that will potentially assist in the revision to 10 CFR part 712 Human Reliability Program.

    The agenda items to be considered include:

    —Reliability Criteria and Monitoring —Designation of HRP positions and methodology —Administration and Appeals —Best Practices for Program Implementation
    DATES:

    The meeting will take place June 28-30, 2016, from 8:30 a.m. to 4:00 p.m. The meeting will consist of several working groups, and all groups will meet together from 1:00 p.m. to 4:00 p.m. on June 30.

    Requests to attend the public meeting must be received no later than June 21, 2016. If a request to attend the public meeting is not received by June 21, 2016, attendance at the public meeting will not be permitted. Written c